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i II Federal Register / Vol. 69, No. 155 / Thursday, August 12, 2004
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Contents Federal Register Vol. 69, No. 155
Thursday, August 12, 2004
Agriculture Department Committee for the Implementation of Textile Agreements See Animal and Plant Health Inspection Service NOTICES See Food and Nutrition Service Textile and apparel categories: See Forest Service Quota and visa requirements— Beneficiary Sub-Saharan African countries; apparel articles; duty- and quota-free import limitations, Animal and Plant Health Inspection Service 49878–49879 RULES Exportation and importation of animals and animal Commodity Futures Trading Commission products: RULES Tuberculosis in cattle; import requirements Commodity Exchange Act: Withdrawn, 49783 Futures commission merchants and introducing brokers; PROPOSED RULES minimum financial and related reporting Plant Protection Act: requirements, 49784–49800 Methyl bromide treatments or applications; official Foreign futures and options transactions: quarantine uses, 49824–49829 Brokers who are members of foreign board of trade; registration exemptions, 49800–49803
Centers for Disease Control and Prevention Community Development Financial Institutions Fund NOTICES NOTICES Agency information collection activities; proposals, Grant and cooperative agreement availability, etc.: submissions, and approvals, 49905–49906 New Markets Tax Credit Program, 49947–49956 Grant and cooperative agreement awards: Cook County Bureau of Health Services, 49906 Education Department NOTICES Centers for Medicare & Medicaid Services Agency information collection activities; proposals, See Inspector General Office, Health and Human Services submissions, and approvals, 49879–49880 Department Employment and Training Administration PROPOSED RULES Civil Rights Commission Federal-State Unemployment Compensation Program; State NOTICES unemployment compensation information; Meetings; State advisory committees: confidentiality and disclosure requirements, 50021– New York, 49861 50040
Energy Department Coast Guard See Federal Energy Regulatory Commission RULES Drawbridge operations: Environmental Protection Agency Louisiana, 49812–49813 NOTICES Ports and waterways safety: Agency information collection activities; proposals, Potomac River, DC; security zone, 49813–49818 submissions, and approvals, 49895–49896 Regattas and marine parades: Superfund; response and remedial actions, proposed Labor Day Fireworks Show, 49811–49812 settlements, etc,: PROPOSED RULES Imperial Refining Site, OK, 49896–49897 Vessel documentation and measurement: Water pollution control: Undocumented barges; numbering, 49844–49845 Clean Water Act— NOTICES Deer Lodge Park L.L.C.; administrative consent Committees; establishment, renewal, termination, etc.: agreement, 49897 National Offshore Safety Advisory Committee, 49912– 49913 Executive Office of the President See Presidential Documents See Trade Representative, Office of United States Commerce Department See International Trade Administration Federal Aviation Administration See National Oceanic and Atmospheric Administration RULES See Patent and Trademark Office Airworthiness directives: RULES Rolls-Royce plc; correction, 49957 Freedom of Information Act; implementation: PROPOSED RULES Appeals; fax and e-mail submission procedures, 49783– Airworthiness directives: 49784 Bombardier-Rotax GmbH, 49829–49832
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Federal Bureau of Investigation Federal Transit Administration NOTICES NOTICES Agency information collection activities; proposals, Environmental statements; notice of intent: submissions, and approvals, 49915 Branson, MO; transit improvement project, 49943–49944
Fish and Wildlife Service Federal Communications Commission NOTICES RULES Meetings: Radio stations; table of assignments: Aquatic Nuisance Species Task Force, 49913–49914 Virginia and Maryland, 49818 NOTICES Food and Drug Administration Common carrier services: RULES Wireless telecommunications services— Administrative practice and procedure: Broadband PCS spectrum auction, 49897–49899 Civil money penalties hearings; maximum penalty Television broadcasting: amounts and compliance with Federal Civil Penalties Violent television programing; impact on children; Inflation Adjustment Act information and comment request, 49899–49904 Correction, 49807–49808 Animal drugs, feeds, and related products: Federal Election Commission Ivermectin and praziquantel paste, 49808–49809 NOTICES NOTICES Meetings; Sunshine Act, 49904 Agency information collection activities; proposals, submissions, and approvals, 49906
Federal Energy Regulatory Commission Food and Nutrition Service NOTICES NOTICES Electric rate and corporate regulation filings, 49888–49889 Meetings: Environmental statements; availability, etc.: Maternal, Infant, and Fetal Nutrition National Advisory PacifiCorp, 49889 Council, 49861 Environmental statements; notice of intent: CenterPoint Energy Gas Transmission Co., 49889–49890 Forest Service Pine Prairie Energy Center, LLC, 49890–49893 NOTICES Gas Program Cost Analysis; Annual Charge Adjustment; Meetings: correction, 49893 Resource Advisory Committees— Hydroelectric applications, 49893 Ketchikan, 49861 Meetings: Midwest Independent Transmission System Operator, Geological Survey Inc.; transmission service/AFC workshop, 49893– NOTICES 49894 Agency information collection activities; proposals, Off-the-record communications, 49894–49895 submissions, and approvals, 49914 Reports and guidance documents; availability, etc.: Independent Coordinator of Transmission establishment; Health and Human Services Department Entergy Services, Inc. technical conference report; See Centers for Disease Control and Prevention comment request, 49895 See Food and Drug Administration Applications, hearings, determinations, etc.: See Health Resources and Services Administration Boston Generating, LLC, 49880 See Inspector General Office, Health and Human Services Chandeldur Pipe Line Co., 49880–49881 Department Clear Creek Storage Co., L.L.C., 49881 NOTICES Columbia Gas Transmission Corp., 49881 Federal claims; interest rates on overdue debts, 49905 Dominion Transmission, Inc., 49881–49882 East Tennessee Natural Gas Co., 49882 Health Resources and Services Administration Gulfstream Natural Gas System, L.L.C., 49882 NOTICES Idaho Power Co., 49882–49883 National Health Service Corps: Iroquois Gas Transmission System, L.P., 49883 Recruitment of sites for assignment of Corps personnel; Lower Mount Bethel Energy, LLC, 49883–49884 entity eligibility, evaluation and selection process, Northern Indiana Public Service Co., 49884–49885 and application requirements, 49906–49908 Norway, MI; Sturgeon Falls Project, 49885 PPL Sundance Energy, LLC, 49885–49886 Homeland Security Department Sabine Pipe Line LLC, 49886 See Coast Guard Saltville Gas Storage Co. L.L.C., 49886 Texas Gas Transmission, LLC, 49886–49887 Inspector General Office, Health and Human Services Transcontinental Gas Pipe Line Corp., 49887–49888 Department Williston Basin Interstate Pipeline Co., 49888 NOTICES Program exclusions; list, 49908–49912
Federal Reserve System Interior Department NOTICES See Fish and Wildlife Service Banks and bank holding companies: See Geological Survey Formations, acquisitions, and mergers, 49904–49905 See National Park Service
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Internal Revenue Service National Oceanic and Atmospheric Administration RULES PROPOSED RULES Procedure and administration: Fishery conservation and management: Business entities classification; definitions clarification, Atlantic highly migratory species— 49809–49811 Pelagic longline fishery; sea turtle interaction and PROPOSED RULES mortality reduction, 49858–49860 Income taxes: NOTICES Partnership liabilities; treatment of disregarded entities, Meetings: 49832–49836 Gulf of Mexico Fishery Management Council, 49877– Partnerships and their partners; sale of qualified small 49878 business stock; gain deferral Correction, 49957 National Park Service Reorganization; transaction qualification requirements, PROPOSED RULES 49836–49840 Special regulations: Procedure and administration: Apostle Islands National Lakeshore, WI; snowmobile and Business entities classification; definitions clarification; off-road motor vehicle routes designation and cross reference, 49840–49841 portable ice augers and power engines use, 49841– NOTICES 49844 Agency information collection activities; proposals, submissions, and approvals, 49956 Nuclear Regulatory Commission NOTICES International Trade Administration Environmental statements; availability, etc.: NOTICES Southern Nuclear Operating Co., Inc., 49916–49917 Antidumping: Meetings: Antifriction bearings and parts from— Reactor Safeguards Advisory Committee, 49917 Various countries, 49861–49862 Applications, hearings, determinations, etc.: Circular welded carbon quality line pipe from— Dominion Nuclear North Anna, LLC, 49916 China, 49862–49863 Exelon Generation Co., LLC, 49916 Outboard engines from— Japan, 49863–49871 Office of United States Trade Representative Polyethylene terephthalate film, sheet, and strip from— See Trade Representative, Office of United States India, 49872–49877 Patent and Trademark Office RULES Justice Department Practice and procedure: See Federal Bureau of Investigation NOTICES Practice before Patent Appeals and Interferences Board, Agency information collection activities; proposals, 49959–50020 submissions, and approvals, 49914–49915 Presidential Documents EXECUTIVE ORDERS Labor Department Southeastern Pennsylvania Transportation Authority and See Employment and Training Administration United Transportation Union; NOTICES Establishment of second emergency board to investigate Agency information collection activities; proposals, labor dispute (E.O. 13351), 50045–50048 submissions, and approvals, 49915–49916 Organization, functions, and authority delegations: Research and Special Programs Administration Assistant Secretary for Administration and Management PROPOSED RULES et al.; Records Management Program, 50041–50043 Hazardous materials; miscellaneous amendments, 49846– 49858 National Aeronautics and Space Administration PROPOSED RULES Securities and Exchange Commission Acquisition regulations: RULES Final scientific and technical reports clause; alternate III Electronic Data Gathering, Analysis, and Retrieval System use in small business innovation and research and (EDGAR): technology transfer contracts, 49845–49846 Filer Manual; update, adoption, and incorporation by reference, 49803–49805 National Highway Traffic Safety Administration Securities: RULES Registered management investment companies; Motor vehicle safety standards: shareholder reports and quarterly portfolio Defect and noncompliance— disclosure; technical amendment, 49805–49807 Early warning and customer satisfaction campaign NOTICES documentation; reporting requirements; correction, Meetings; Sunshine Act, 49917–49918 49822–49823 Options Price Reporting Authority: Reimbursement prior to recall, 49819–49822 Consolidated Options Last Sale Reports and Quotation NOTICES Information; Reporting Plan; amendments, 49918– Motor vehicle safety standards: 49919 Exemption petitions, etc.— Self-regulatory organizations; proposed rule changes: American Auto Dream, 49944–49946 Boston Stock Exchange, Inc., 49919–49920
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National Association of Securities Dealers, Inc., 49920– See Surface Transportation Board 49926 NOTICES National Stock Exchange, 49926–49929 Aviation proceedings: Pacific Exchange, Inc., 49929–49933 Agreements filed; weekly receipts, 49943 Philadelphia Stock Exchange, Inc., 49933–49934 Treasury Department State Department See Community Development Financial Institutions Fund NOTICES See Internal Revenue Service Grants and cooperative agreements; availability, etc.: South Asia Professional Exchanges and Training Program, 49934–49940 Separate Parts In This Issue
Surface Transportation Board Part II NOTICES Commerce Department, Patent and Trademark Office, Railroad operation, acquisition, construction, etc.: 49959–50020 Burlington Northern & Santa Fe Railway Co., 49946 Railroad services abandonment: Part III Wyoming & Colorado Railroad Co., Inc., 49946–49947 Labor Department, Employment and Training Administration, 50021–50040 Textile Agreements Implementation Committee See Committee for the Implementation of Textile Part IV Agreements Labor Department, 50041–50043 Trade Representative, Office of United States Part V NOTICES Executive Office of the President, Presidential Documents, Trade Policy Staff Committee: 50045–50048 Pharmaceutical products receiving zero duties; list expansion; comment request, 49940–49942 World Trade Organization: Dispute settlement panel establishment requests— Reader Aids Japan; phytosanitary measures restricting importation Consult the Reader Aids section at the end of this issue for of U.S. apples, 49942–49943 phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws. Transportation Department To subscribe to the Federal Register Table of Contents See Federal Aviation Administration LISTSERV electronic mailing list, go to http:// See Federal Transit Administration listserv.access.gpo.gov and select Online mailing list See National Highway Traffic Safety Administration archives, FEDREGTOC-L, Join or leave the list (or change See Research and Special Programs Administration 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 180...... 49846 Executive Orders: 50 CFR 13334 (See EO Proposed Rules: 13351) ...... 50047 635...... 49858 13351...... 50047 7 CFR Proposed Rules: 304...... 49824 9 CFR 93...... 49783 14 CFR 39...... 49957 Proposed Rules: 39...... 49829 15 CFR 4...... 49783 17 CFR 1...... 49784 30...... 49800 232...... 49803 239...... 49805 274...... 49805 20 CFR Proposed Rules: 603...... 50022 21 CFR 17...... 49807 520...... 49808 26 CFR 301...... 49809 Proposed Rules: 1 (3 documents) ...... 49832, 49836, 49957 301...... 49840 33 CFR 100...... 49811 117...... 49812 165 (2 documents) ...... 49813, 49816 36 CFR Proposed Rules: 7...... 49841 37 CFR 1...... 49960 5...... 49960 10...... 49960 11...... 49960 41...... 49960 46 CFR Proposed Rules: 66...... 49844 47 CFR 73...... 49818 48 CFR Proposed Rules: 1835...... 49845 1852...... 49845 49 CFR 573...... 49819 577...... 49819 579...... 49822 Proposed Rules: 171...... 49846 172...... 49846 173...... 49846 178...... 49846 179...... 49846
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Rules and Regulations Federal Register Vol. 69, No. 155
Thursday, August 12, 2004
This section of the FEDERAL REGISTER part 93 (§§ 93.400 through 93.435, requests to the Office of General contains regulatory documents having general referred to below as the regulations) Counsel. The e-mail address is designed applicability and legal effect, most of which governs the importation of ruminants. specifically to receive FOIA appeals. are keyed to and codified in the Code of Section 93.406 of the regulations This amendment will ensure a more Federal Regulations, which is published under contains requirements for diagnostic uniform and controlled method for the 50 titles pursuant to 44 U.S.C. 1510. tests for brucellosis and tuberculosis. receipt and tracking of FOIA appeals, as The Code of Federal Regulations is sold by Section 93.427 contains some additional well as assist the Office of General the Superintendent of Documents. Prices of safeguards against tick-borne diseases, Counsel in providing accurate and new books are listed in the first FEDERAL brucellosis, and tuberculosis for cattle timely responses. REGISTER issue of each week. imported into the United States from DATES: Effective August 12, 2004. Mexico. ADDRESSES: The public may submit On July 20, 2004 (69 FR 43283–43285, written FOIA appeals to the Department DEPARTMENT OF AGRICULTURE Docket No. 03–081–1), APHIS published to the following address: U.S. in the Federal Register an interim rule Department of Commerce, Office of Animal and Plant Health Inspection amending §§ 93.406 and 93.427 to Service General Counsel, Room 5875, 14th and require that steers and spayed heifers Constitution Avenue, NW., Washington, with any evidence of horn growth that DC 20230, or to the following e-mail 9 CFR Part 93 are entering the United States meet the address, [email protected], or fax [Docket No. 03–081–2] same tuberculosis testing requirements number, 202–482–2552. as sexually intact animals entering the FOR FURTHER INFORMATION CONTACT: Tuberculosis in Cattle; Import United States. The interim rule was Brian D. DiGiacomo, 202–482–5391. Requirements scheduled to become effective on SUPPLEMENTARY INFORMATION: Section August 19, 2004. AGENCY: Animal and Plant Health 4.10(a) of the Department of Inspection Service, USDA. We have decided to publish a Commerce’s regulations implementing proposed rule in place of the interim ACTION: Interim rule; withdrawal. the Freedom of Information Act (5 rule. Therefore, we are withdrawing the U.S.C. 552) states that if a request for SUMMARY: This document withdraws the interim rule and will publish the records is initially denied in whole or interim rule amending the animal proposed rule in the Federal Register in in part, or has not been timely importation regulations to require that the near future. determined, or if the requester receives steers and spayed heifers with any Authority: 7 U.S.C. 1622 and 8301–8317; an adverse initial determination evidence of horn growth that are 21 U.S.C. 136 and 136a; 31 U.S.C. 9701; 7 regarding any other matter under this entering the United States meet the CFR 2.22, 2.80, and 371.4. subpart, the requester may file a written same tuberculosis testing requirements Done in Washington, DC, this 4th day of appeal, which must be received by the as sexually intact animals entering the August 2004. Office of General Counsel within 30 United States. That interim rule was W. Ron DeHaven, calendar days of the date of the written published in the Federal Register on Administrator, Animal and Plant Health denial or, if there has been no July 20, 2004, and was scheduled to Inspection Service. determination, may be submitted become effective on August 19, 2004. [FR Doc. 04–18446 Filed 8–11–04; 8:45 am] anytime after the due date. 15 CFR 4.10(a). In order to create a more direct We have decided to publish a proposed BILLING CODE 3410–34–P rule in place of the interim rule. The way to receive FOIA appeals, the Office proposed rule will be published in the of General Counsel has created a new e- Federal Register in the near future. mail address and has made available a DEPARTMENT OF COMMERCE fax number. The address is DATES: This withdrawal is effective [email protected]. The fax number August 12, 2004. Office of the Secretary is 202–482–2552. When an appeal is FOR FURTHER INFORMATION CONTACT: Dr. submitted via fax or e-mail, it must 15 CFR Part 4 Terry Beals, National Tuberculosis include a copy of the initial FOIA Program Coordinator, Eradication and [Docket No. 040730221–4221–01] request and a copy of the initial denial Surveillance Team, National Center for letter as attachments to the fax or e-mail. Animal Health Programs, VS, APHIS, RIN 0605–AA18 The submission will not be considered 4020 N. Lincoln Blvd., Suite 101, Disclosure of Government Information complete without these attachments. Oklahoma City, OK 73105; (405) 427– Written appeals submitted by mail will 2998. AGENCY: Department of Commerce. still be accepted. Requesters may begin SUPPLEMENTARY INFORMATION: ACTION: Final rule. using the fax number and new e-mail address as of August 12, 2004. Please be Background SUMMARY: This document amends the aware that the e-mail, fax machine and The regulations in 9 CFR part 93 Department of Commerce’s Office of the General Counsel are prohibit or restrict the importation of (Department) Freedom of Information monitored only during normal business certain animals, birds, and poultry into Act (FOIA) regulations by adding a hours (8:30 a.m. to 5 p.m., eastern time, the United States to prevent the facsimile (fax) number and an e-mail Monday through Friday). FOIA appeals introduction of communicable diseases address as methods of transmitting posted to the e-mail box, fax machine or of livestock and poultry. Subpart D of appeals of initial responses to FOIA Office of the General Counsel after
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normal business hours will be deemed I 2. Amend § 4.10 by revising COMMODITY FUTURES TRADING received on the next normal business paragraphs (a) and (b) to read as follows: COMMISSION day. § 4.10 Appeals from initial determinations 17 CFR Part 1 Classification or untimely delays. Executive Order 12866: This rule has (a) If a request for records is initially RIN 3038 — AB64 been determined to be not significant for denied in whole or in part, or has not purposes of EO 12866. been timely determined, or if a requester Minimum Financial and Related Administrative Procedure Act: The receives an adverse initial Reporting Requirements for Futures Department finds under 5 U.S.C. determination regarding any other Commission Merchants and 553(b)(B) that good cause exists to waive Introducing Brokers prior notice and opportunity for public matter under this subpart (as described comment. This final rule amends the in § 4.7(b)), the requester may file a AGENCY: Commodity Futures Trading Department’s FOIA regulations to allow written appeal or an electronic appeal, Commission. the public to file written appeals with which must be received by the Office of ACTION: Final rule. the Office of General Counsel via fax or General Counsel during normal business e-mail. By accepting fax and e-mail hours (8:30 a.m. to 5 p.m., Eastern Time, SUMMARY: The Commodity Futures transmissions, the Department merely Monday through Friday) within thirty Trading Commission (‘‘Commission’’) is establishes additional means for the calendar days of the date of the written amending several of its regulations public to submit FOIA appeals to the denial or, if there has been no relating to the minimum financial and Office of General Counsel. The right to determination, may be submitted related reporting requirements for and the requirements of filing such an anytime after the due date, including futures commission merchants appeal are unchanged by this rule. the last extension under § 4.6(c), of the (‘‘FCMs’’) and introducing brokers Because this amendment is not a determination. Written or electronic (‘‘IBs’’). The amended regulations substantive change to the regulations, it appeals arriving after normal business require an FCM, when calculating its is unnecessary to provide prior notice hours will be deemed received on the minimum adjusted net capital and opportunity for public comment. next normal business day. requirement, to include a computation Further, pursuant to 5 U.S.C. 553(b)(A), based on the risk maintenance margin (b) Appeals shall be decided by the this rule of agency organization, levels of positions carried in customer procedure and practice is not subject to Assistant General Counsel for and noncustomer accounts. The the requirement to provide prior notice Administration (AGC-Admin), except required calculation is identical to and opportunity for public comment. that appeals for records which were capital calculations that each FCM The Department also finds that the 30- initially denied by the AGC-Admin currently is required to perform day delay in effectiveness required shall be decided by the General pursuant to the rules of self-regulatory under 5 U.S.C. 553(d) is inapplicable Counsel. Written appeals should be organizations, including one derivatives because this rule is not a substantive addressed to the AGC-Admin, or the clearing organization. The Commission rule. This final rule merely establishes General Counsel if the records were also is adopting conforming margin- additional means for the public to initially denied by the AGC-Admin. The based computations for purposes of the submit FOIA appeals to the Office of address of both is: U.S. Department of Commission’s equity capital, General Counsel. Because this Commerce, Office of General Counsel, subordination agreement and ‘‘early amendment is not a substantive change Room 5875, 14th and Constitution warning’’ requirements for FCMs. The to the regulations, the 30-day delay in Avenue NW., Washington, DC 20230. margin-based computations required by effectiveness does not apply. An appeal may also be sent via facsimile the final rule replace computations in Regulatory Flexibility Act: Because at 202–482–2552. For a written appeal, the Commission’s regulations that had notice and opportunity for comment are both the letter and the appeal envelope been based on the amount of funds held not required pursuant to 5 U.S.C. 553 or should be clearly marked ‘‘Freedom of by an FCM to margin, guarantee, or secure futures and option positions any other law, the analytical Information Appeal’’. The address for carried on behalf of customers. requirements of the Regulatory electronic appeals is Furthermore, the Commission is Flexibility Act (5 U.S.C. 601 et seq.) are [email protected]. The appeal inapplicable. Therefore, a regulatory amending its regulations to reduce the (written or electronic) must include a flexibility analysis is not required and time periods for FCMs and IBs to report copy of the original request and the has not been prepared. events specified in the Commission’s initial denial, if any, and a statement of early warning requirements. Finally, the List of Subjects in 15 CFR Part 4 the reasons why the records requested Commission also is adopting Administrative practice and should be made available and why the amendments to streamline the financial procedure, Classified information. initial denial, if any, was in error. No statement reporting requirements for opportunity for personal appearance, I For the reasons stated in the preamble, FCMs and IBs. the Department of Commerce amends 15 oral argument or hearing on appeal is DATES: Effective Date: September 30, CFR part 4 as set forth below: provided. 2004. * * * * * FOR FURTHER INFORMATION CONTACT: PART 4—DISCLOSURE OF Dated: August 6, 2004. GOVERNMENT INFORMATION Thomas J. Smith, Associate Deputy Brenda Dolan, Director and Chief Accountant, at (202) I 1. The authority citation for part 4 Departmental Freedom of Information 418–5495, or Thelma Diaz, Special continues to read as follows: Officer. Counsel, at (202) 418–5137, Division of Authority: 5 U.S.C. 301; 5 U.S.C. 552; 5 [FR Doc. 04–18412 Filed 8–11–04; 8:45 am] Clearing and Intermediary Oversight, Commodity Futures Trading U.S.C. 552a; 5 U.S.C. 553; 31 U.S.C. 3717; 44 BILLING CODE 3510–17–P U.S.C. 3101; Reorganization Plan No. 5 of Commission, Three Lafayette Centre, 1950. 1155 21st Street, NW., Washington, DC
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20581. Electronic mail: firms registered as FCMs,4 and two were the comments received.9 The ([email protected]) or ([email protected]). from industry trade associations, the Commission also encourages interested National Introducing Brokers persons to read the detailed analysis in SUPPLEMENTARY INFORMATION: Association (‘‘NIBA’’) and the Futures the Proposing Release for each of the I. Summary of Rule Amendments as Industry Association (‘‘FIA’’). The proposed rule amendments. Citations to Proposed by the Commission National Futures Association (‘‘NFA’’),5 the pertinent pages of the Proposing the Joint Audit Committee (‘‘JAC’’),6 and Release have been included as part of Section 4f(b) of the Commodity a former Commission staff member also the discussion in this final rulemaking Exchange Act (the ‘‘Act’’) authorizes the submitted comment letters.7 These release of the amendments being Commission, by regulation, to impose comments are discussed in more detail adopted by the Commission. minimum financial and related later in this supplementary information As discussed in the Proposing reporting requirements on FCMs and section. 1 Release, Rule 1.10 requires FCMs to IBs. On July 9, 2003, the Commission The Commission, after further prepare Forms 1–FR–FCM to file issued a release proposing amendments consideration, including consideration financial information with the to Commission Rules 1.10, 1.12, 1.16, of the comments, has determined to Commission and their designated self- 1.17, and 1.18, which set forth certain adopt the following: (1) A requirement regulatory organization. The minimum financial and related that an FCM include, as part of the Commission advised in the Proposing reporting requirements for FCMs and calculation of its minimum adjusted net 2 Release that it would make conforming IBs (the ‘‘Proposing Release’’). The key capital requirement, a computation amendments to the Form 1–FR–FCM to element of the Proposing Release was a based on the maintenance margin levels reflect risk-based capital and changes to proposal to amend Rule 1.17(a) to of the positions or transactions carried the early warning reporting require margin-based, also referred to as by the FCM in customer and requirements, if adopted by the ‘‘risk-based,’’ capital computations for noncustomer accounts, including Commission.10 The Commission has an FCM’s calculation of its minimum futures, option on futures, and other approved such conforming amendments adjusted net capital requirement. The transactions that the Commission has, to the Form 1–FR–FCM, and the revised Proposing Release also included by order or otherwise, approved for form is available to FCMs upon request conforming amendments to other carrying in customer segregated from the Commission.11 paragraphs of Rule 1.17 that set forth accounts in accordance with section 4d Rule 1.10(d)(1) provides that each capital computations that FCMs must of the Act or that are carried by the FCM Form 1–FR–FCM, which is not required 8 perform for purposes related to their in noncustomer accounts; (2) a to be certified by an independent public equity capital and subordination conforming capital computation for accountant, must be completed in agreements, and to capital computations early warning purposes, but which has accordance with the instructions to the in Rule 1.12 that FCMs must make to been modified from the version Form. The Commission issued a Form comply with the Commission’s ‘‘early proposed in the Proposing Release; and 1–FR–FCM Instruction Manual in 1989, warning’’ requirements. Other rule (3) other capital computations for and the Manual has not been revised amendments in the Proposing Release purposes of an FCM’s subordination since it was issued. Accordingly, the proposed to shorten the time periods agreements and equity capital, which Commission has approved proposed specified in Commission rules for FCMs have also been modified, as specified changes to the 1–FR–FCM Instruction and IBs to report certain financial events herein, from the versions that were Manual to conform the Manual to rule to the Commission, and to reduce the originally proposed. Further, the amendments adopted in this final time periods before which an FCM is Commission has determined to adopt rulemaking. The Instruction Manual is required to take a capital charge for amendments relating to the financial available electronically on the outstanding margin calls on its customer reporting requirements of FCMs and IBs Commission’s Web site and hard copies and noncustomer accounts. Lastly, the as proposed in the Proposing Release. may be obtained by contacting the Proposing Release included proposed Each of the rule amendments that the Commission.12 revisions of Rules 1.10, 1.16 and 1.18 in Commission has determined to adopt is order to amend the requirements for the discussed more fully in Parts II through II. Risk-Based Capital Requirements financial statements that FCMs and IBs VI of this supplementary information The Commission’s capital must file with the Commission. section, first by summarizing the requirement for FCMs is set forth in The Commission received ten letters background of the proposed rule Rule 1.17(a)(1)(i)(A)–(D), which, prior to in response to its request for comments amendment, then by summarizing the the amendments adopted by this on the proposed rule amendments in the comments received in response, and rulemaking, required an FCM to Proposing Release.3 Of these ten finally by specifying the modifications, maintain minimum adjusted net capital comments, five were from individual if any, that have been made to the final rule as adopted after consideration of 9 Part V summarizes the Commission’s 1 The Act is codified at 7 U.S.C. 1 et seq. (2003), determination to not adopt as part of this final and section 4f(b) of the Act is codified at 7 U.S.C. 4 Comment letters were filed by Cargill Investor rulemaking the proposed amendments to reduce the 6f(b). The Commission’s rules cited in this final Services, Inc.; Fimat USA, Inc.; Man Financial Inc.; time periods before which an FCM is required, rulemaking may be found at 17 CFR Ch. 1 (2003). R.J. O’Brien & Associates, Inc.; and Carr Futures Inc. pursuant to Rule 1.17(c)(5), to take a capital charge 2 68 FR 40835 (July 9, 2003). The Proposing 5 NFA is a registered futures association pursuant for outstanding margin calls on its customer and Release may be accessed electronically through the to section 17 of the Act. noncustomer accounts. Commission’s Web site http://www.cftc.gov/. 6 The JAC is a committee formed by futures 10 68 FR at 40838, fn. 13. See 60 FR at 40840 — 3 The comment letters are available for inspection exchanges and other self-regulatory organizations to 40842. and copying at the Commission’s Washington office coordinate audit and financial surveillance 11 Requests for the form should be addressed to in its public reading room, Room 4072, Three activities of FCMs. the Commission’s Office of the Secretariat, Three Lafayette Centre, 1155 21st Street, NW., 7 Paul H. Bjarnason, Jr. filed a comment letter. Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581. The telephone number for 8 The Proposing Release explained that the term Washington, DC 20581. the public reading room is (202) 418–5025. The ‘‘noncustomer’’ is defined by Rule 1.17(b)(4) and 12 Requests for the Form 1–FR–FCM Instruction comment letters also are available on the generally refers to an entity affiliated with an FCM, Manual should be addressed to the Commission’s Commission’s public Web site at http:// including certain employees and officers of an Office of the Secretariat, Three Lafayette Centre, www.cftc.gov/foia/comment03/foi03—009_1.htm. FCM. 68 FR at 40838. 1155 21st Street, NW., Washington, DC 20581.
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equal to, or in excess of, the greatest of the Proposing Release, in proposing this position or portfolio of futures contracts the following: requirement the Commission was and/or options on futures contracts is a. $250,000; intending to frame a margin-based traded requires its members to collect b. Four percent of an amount, capital computation that would be from the owner of the account, subject hereinafter to referred as the identical to the margin-based minimum to several additional requirements. ‘‘Segregated Amount,’’ that equals the net capital computation that several Upon further review, the Commission total of the funds required to be futures self-regulatory organizations, has determined that the definition segregated for customers trading on U.S. including one derivatives clearing proposed for Rule 1.17(b)(8) does not commodity markets pursuant to section organization, have adopted for adequately encompass all of the margin 4d(a)(2) of the Act, including the funds determining the risk-based capital or performance bond that FCMs, in of customers trading on registered requirements of their respective accordance with the requirements of the derivatives transaction execution member-FCMs.16 futures organizations to which they facilities that have elected to opt-out of For purposes of the proposed risk- belong, currently include in their segregation pursuant to Rule 1.68, and based minimum adjusted net capital margin-based capital computations. By the funds required to be secured for requirement, the Commission proposed limiting the computation to ‘‘futures customers trading on foreign commodity new or amended definitions in Rule contracts and options on futures markets pursuant to Rule 30.7, less the 1.17(b) for the terms ‘‘customer contracts’’, the proposed rule might market value of options purchased by account,’’ ‘‘noncustomer account,’’ and have been interpreted to exclude non- customers for which the full premiums ‘‘risk margin requirement.’’ 17 In general, futures positions or transactions that the have been paid; the term ‘‘customer account’’ would be Commission has authorized to be held c. The amount of adjusted net capital defined by Rule 1.17(b)(7) to include the in customer accounts pursuant to required by a registered futures account of any customer as defined by section 4d of the Act, or the non-futures association (NFA presently being the Rule 1.17(b)(2), which includes positions or transactions that an FCM only such association) of which the customers as defined by Rule 1.3(k), elects to hold in noncustomer accounts. FCM is a member; or option customers as defined by Rules For example, options on securities that d. For FCMs that also are registered 1.3(jj) and 32.1(c), and foreign futures are held in commodity customer with the U.S. Securities and Exchange and foreign option customers as defined accounts pursuant to section 4d of the Commission (‘‘SEC’’) as securities by Rule 30.1(c), and also would include Act under the terms and conditions of brokers or dealers, the amount of net the accounts of foreign-domiciled Commission approved cross-margining capital required by SEC Rule 15c3– customers trading on foreign boards of programs are included in FCMs’ risk- 1(a).13 trade. The term ‘‘noncustomer account’’ based margin calculations under the In the Proposing Release, the would continue to be defined by Rule current rules of self-regulatory Commission noted various limitations 1.17(b)(4) as an account that is not organizations. In addition, over-the- in the current net capital rule that could included in the definition of either counter contracts and options that FCMs be addressed by requiring capital customer (Rule 1.17(b)(2)) or proprietary hold in section 4d customer accounts computations based on the margin account (Rule 1.17(b)(3)), and also pursuant to Commission orders also are levels of customer and noncustomer would include noncustomer accounts currently included in the FCMs’ risk- positions carried by the FCM, in lieu of for foreign-domiciled persons trading on based capital computations. the capital computation now required to foreign boards of trade. The term ‘‘risk Furthermore, by limiting the be based on the Segregated Amount. For margin’’ requirement for an account computation to margin required ‘‘by the example, a primary limitation of the would be defined by a new Rule exchange on which a position or Segregated Amount is that it does not 1.17(b)(8), which in the Proposing portfolio of futures contracts and/or include noncustomer positions and Release was defined to mean the level options on futures contracts is traded’’, therefore does not fully reflect the of maintenance margin, or performance the proposed rule does not reflect the extent to which an FCM is financially bond, that the exchange 18 on which a growing diversity in the types of exposed to commodity positions that it positions that FCMs may be able to carries for both customers and commodity exchanges use the Standard Portfolio carry for customers and noncustomers, noncustomers.14 The Commission Analysis of Risk (‘‘SPAN’’) margining system for including positions that are not traded calculating margin requirements on a portfolio of accordingly proposed amendments to futures and option positions. The SPAN on a DCM or DTEF, but are cleared by 19 Rule 1.17(a)(1)(i)(B) that would delete maintenance margin level consists of a ‘‘risk’’ a derivatives clearing organization. the computation that is based upon the component and an ‘‘equity’’ component. The risk Segregated Amount, and would require component covers potential future losses in the contract markets (‘‘DCMs’’) and derivatives portfolio value. Such losses include a market move in its place a computation based on the transaction execution facilities (‘‘DTEFs’’) governed against a futures position or a short (written) option. by the Act. Also, the proposed definition of aggregate of: (i) Eight percent of the The equity component (option premium, marked- ‘‘customer account’’ in Rule 1.17(b)(7) would ‘‘risk margin’’ requirement on futures to-the market daily) reflects the asset represented by extend to FCM customers trading on DTEFs. Such and option on futures positions carried long option positions or the liability represented by customers are included in the definition of short (written) option positions in the portfolio. Id. in customer accounts; and (ii) four customer in Rule 1.3(k), which is incorporated by 16 As of January 1, 1998, the Clearing Corporation reference in Rule 1.17(b)(2), and all customers percent of the ‘‘risk margin’’ (formerly the Board of Trade Clearing Corporation), included within Rule 1.17(b)(2) are also included in requirement on futures and option on the Chicago Board of Trade, and the Chicago the definition set forth in Rule 1.17(b)(7). futures positions carried in Mercantile Exchange have all adopted margin-based 19 In particular, clearing members of the New minimum capital requirements for their respective noncustomer accounts.15 As noted in York Mercantile Exchange (‘‘NYMEX’’) currently clearing member firms. The NFA adopted similar maintain accounts for customers clearing products risk-based minimum capital requirements for its that are listed, but not traded, on the NYMEX 13 The SEC rules cited in this release may be member FCMs effective October 31, 2000. All of exchange. The margin requirements for such found at 17 CFR Ch. 2 (2003). these organizations use the same percentages of risk products are established by NYMEX as a derivatives 14 The Commission discussed in detail other maintenance margin that the Commission has clearing organization. See Commission order dated limitations to the capital rule based upon the proposed for its amended net capital rule. 68 FR at February 2, 2004, supplementing the Commission’s Segregated Amount in the Proposing Release. 68 FR 40837–8. prior order dated May 30, 2002. A copy of the order at 40837–40. 17 68 FR at 40847–8. is available on the Commission’s Web site at 15 As discussed in the Proposing Release, U.S. 18 The applicable exchange rules would include http://www.cftc.gov/files/tm/ commodity exchanges and numerous foreign those of foreign exchanges and those of designated tmnymexotcorder021004.pdf.
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Accordingly, the Commission has risk margin for an account carried by a Amount, but no additional amendments determined to modify the definition it futures commission merchant which is would be made to Rule 1.17(a) to originally proposed to set forth in Rule not a member of the exchange or the specify a risk-based capital 1.17(b)(8) for the risk margin clearing organization that requires computation. FIA suggested, and NFA requirement for an account. As collection of such margin should be agreed, that any recommendations modified, an account’s risk margin calculated as if the futures commission resulting from the proposed review of requirement would mean the level of merchant were such a member. Finally, margin-based capital requirements maintenance margin, or performance if an FCM does not possess sufficient could be put into effect by NFA’s bond, that the FCM is required under information to determine what portion amendment of its rules, because NFA’s the rules of an exchange (or by a of an account’s total margin requirement risk-based capital requirements apply to clearing organization if the required represents risk margin, the proposed all FCMs. margin level is established not by an definition would require that the FCM The Commission welcomes and exchange but rather by a clearing treat as risk margin all of the margin encourages the commitment of industry organization) to collect from the owner required by the exchange, clearing resources towards an active and of a customer account or noncustomer organization, or other FCM or entity for continuous evaluation of the capital account for all positions, whether that account. For example, if customer requirements set forth in the futures positions or non-futures or noncustomer positions are executed Commission’s rules. The Commission positions, held in such accounts.20 This on a foreign board of trade and the FCM believes that the analysis proposed in definition would be subject to several does not possess sufficient information FIA’s letter is neither precluded by, nor additional requirements, which also to determine what portion of the foreign inconsistent with, the Commission’s were included in the definition board of trade’s required margin is risk immediate adoption of the proposed originally described in the Proposing margin as defined under Rule 1.17(b)(8), risk-based capital requirements for Release. First, the definition of risk the FCM is required to include the FCMs. Any proposals for further margin would not include the equity entire margin requirement in its risk- amendment to these risk-based capital component of short or long option based capital computation. rules would be evaluated by the positions maintained in an account. The commenters overwhelmingly Commission in light of all the Act’s Second, the maintenance margin or endorsed the Commission’s proposal to financial safeguards for monitoring the performance bond requirement eliminate the capital computation based financial integrity of futures associated with a long option position upon the Segregated Amount, and intermediaries, and the Commission can may be excluded from risk margin to the supported the application of minimum thereafter publish for public comment extent that the value of such long option adjusted net capital requirements based in the Federal Register such position does not reduce the total risk upon risk maintenance margin. The amendments as it proposes to adopt. maintenance or performance bond commenters also did not object to any The Commission has considered the requirement of the account that holds of the definitions proposed by the comments received and is adopting as the long option position.21 Third, the Commission to implement risk-based final the amendments to Rule 1.17(a) capital requirements. However, FIA and and (b) as set forth in the Proposing 20 For some limited classes of customer accounts, two individual commenters endorsed Release, with the modification primarily those of non-clearing exchange members conducting further analysis of the discussed earlier to the definition of risk trading for their own accounts only, the rules of margin-based capital requirements of margin in Rule 1.17(b)(8). As amended, three DCMs permit member FCMs to refrain from the NFA and other self-regulatory Rule 1.17(a)(1)(i)(B) will no longer be collecting the exchange-established maintenance margin levels otherwise required by such rules for organizations, with which the based upon the Segregated Amount, but positions held in customer accounts and Commission rule, as amended, will now will instead include the following noncustomer accounts. All of the organizations that be consistent, for the purpose of capital computation: Eight percent of have adopted risk-based capital rules for FCMs (the identifying possible enhancements that the total risk margin requirement for all NFA, a derivatives clearing organization and two DCMs, as identified in footnote 16) require their might be made to the Commission’s positions carried by the FCM in member FCMs to disregard such exceptions when rules.22 FIA offered to undertake such customer accounts, plus four percent of computing their minimum net capital requirements. an analysis, in coordination with the the total risk margin requirement for all The Commission intends Rule 1.17, as adopted self-regulatory organizations, and with positions carried by the FCM in herein, to impose the same requirement. FCMs must noncustomer accounts. As discussed therefore include in their adjusted net capital the participation of the Commission requirements the exchange-established maintenance expressly welcomed. earlier, the definition of the risk margin margin levels for all positions in the accounts held FIA offered a recommendation that it requirement for an account is set forth by the FCM for its customers and noncustomers. believed might accelerate the adoption in a new Rule 1.17(b)(8), and is It should also be noted that such rules may of any changes that received the determined generally by subtracting permit the exchange or clearinghouse to increase margin requirements to reflect circumstances other endorsement of the participants in the from the maintenance margin that the than changes in SPAN measurements. For example, proposed analysis. Under FIA’s rules of an exchange or clearinghouse an exchange may require an FCM to collect more proposal, Rule 1.17(a) would be requires an FCM to collect from the than the standard margin from a specific customer amended to delete the current capital owner of a customer or noncustomer due to credit or other concerns. The definition of account: (i) The equity component of risk margin, both as originally proposed and herein computation based on the Segregated adopted, would include such margin. each position; and (ii) the maintenance 21 There is generally no risk to the FCM the maintenance margin for long option positions margin for each long option position associated with a long option position, because the that are not hedging other futures or option that is not held to hedge other positions maximum potential loss is the full option premium, positions. 68 FR at 40838. in the account. However, as noted in the which is paid by the customer in full at the 22 For example, FIA suggested examining such inception of the transaction. However, because long rules to determine whether they reflected advances Proposing Release, the Commission option positions that hedge other futures and option in risk management made since 1998. An FCM also understands that calculating the positions in a portfolio will reduce the total margin proposed that the Commission’s rule should grant maintenance margin on specific long requirement of the portfolio, SPAN includes a risk a credit of 25 percent for each dollar of margin that option positions in a portfolio may maintenance margin component to protect against an FCM carries in excess of that required by the a decline in the market value of such long option exchange, and Mr. Bjarnason identified other require a certain amount of manual positions. The Proposing Release proposed to allow possible modifications for the Commission to processing under current back office FCMs to deduct from their risk margin requirements consider. operating procedures, which some
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FCMs may wish to forego because it adjusted net capital that is equal to or in Rule 1.17(a)(1)(i)) to submit written would not materially reduce their risk- in excess of the minimum adjusted net notice within 24 hours, instead of the based minimum capital requirement.23 capital required by Rule 1.17(a)(1)(i), five business days presently allowed Accordingly, the amended rule permits, but below a specified level that is under the Commission’s rule. Moreover, but does not require, an FCM to exclude greater than the FCMs’ required the Commission proposed to delete the the risk maintenance margin for long minimum (to be referred to hereafter as requirement in Rule 1.12(b) for monthly options that do not hedge other the ‘‘early warning capital level’’), then unaudited financial statements from an positions maintained in the account. the FCM is required to meet specified FCM that had failed to meet its early The amended rule further provides notice requirements and to file with the warning capital level, because this that if the risk margin associated with Commission and the firm’s DSRO provision would become moot upon the cleared positions cannot be determined monthly unaudited financial statements. Commission’s adoption of a proposed by the FCM, the firm will be required The early warning capital level required amendment to Rule 1.10, discussed to apply the specified percentages for under Rule 1.12(b) equals the greatest of below, that would require all FCMs to customer and noncustomer accounts to the following: file unaudited financial statements on a the total margin required by the a. $375,000; monthly basis, instead of on a quarterly exchange, clearing organization, other b. Six percent of the Segregated basis as is currently required under Rule futures commission merchant or entity Amount; 1.10.26 for the customer and noncustomer c. 150 percent of the amount of The Proposing Release noted a positions carried. In addition, as noted adjusted net capital required by a recommendation from the JAC that the in the Proposing Release, the new registered futures association (i.e., NFA) Commission eliminate from Rule 1.12 margin-based capital computations will of which the FCM is a member; or not only the monthly filing requirement, not apply to proprietary (i.e., firm- d. For FCMs that also are registered but also the requirement that an FCM owned) accounts. Rule 1.17(c)(5)(x) with the SEC as securities brokers or failing to meet or exceed its early currently includes proprietary positions dealers, the amount of net capital warning capital level provide notice to in the calculation of adjusted net capital required by SEC Rule 17a–11(b). the Commission and its DSRO. The to the extent that uncovered proprietary Paragraph (c) of Rule 1.12 currently Commission, however, expressed positions (i.e., positions that are not requires an FCM or IB to provide same concern that eliminating the notice hedged by cash market transactions) day notice to the Commission and its requirement could diminish the result in a charge or ‘‘haircut’’ to the DSRO of any failure to make or keep Commission’s and the DSRO’s ability to firm’s net capital based on current the books and records that are react promptly to potential financial clearinghouse or exchange margin required by the Commission’s crises at an FCM. To assist the requirements.24 regulations, and the firm also must file Commission with its analysis of this within five business days after giving issue, the Commission invited comment III. Early Warning Requirements Under such notice a written report that Rule 1.12 from interested parties on whether the describes what steps have been and are proposed 150 percent early warning Pursuant to Commission Rule 1.12, an being taken to correct the situation. capital level would be appropriate FCM or IB must comply with several Paragraph (d) of Rule 1.12 requires an under a risk-based capital rule or requirements upon the occurrence of FCM or IB to provide notice, within whether it should be adjusted or predefined events that may raise three business days, to the Commission eliminated. concerns regarding the firm’s ability to and its DSRO if the firm discovers or is All of the comments received by the meet its obligations to the market, notified by its independent public Commission recommended against safeguard customer funds, or otherwise accountant of the existence of any establishing an early warning capital continue normal business operations. material inadequacy in the internal level for margin-based capital The requirements in Rule 1.12, which controls of the firm. Within five requirements. According to FIA, the include notices that the FCM or IB must business days after providing the proposed amendment is unnecessary file with the Commission and the firm’s required notice, the FCM or IB also must since risk-based capital requirements designated self-regulatory organization file a written report stating what steps encourage FCMs to maintain capital in (‘‘DSRO’’),25 enhance the ability of the have been and are being taken to correct excess of their required minimums, Commission and the DSRO to respond the material inadequacy in its internal reflecting the fact that margin-based with a heightened degree of controls. capital requirements are more sensitive surveillance, as may be necessary or to significant market moves than are prudent, in light of the possibility of A. Early Warning Capital Levels for capital requirements based on customer deteriorating operating or financial FCMs segregated funds.27 FIA further conditions at a firm. The requirements The amendment proposed for Rule suggested that the proposed amendment in Rule 1.12 are therefore generally 1.12(b) would replace the early warning is unnecessary because DSROs employ referred to as ‘‘early warning’’ capital level computation that is based a variety of methods to identify and to requirements. on six percent of the Segregated Amount Paragraph (b) of Rule 1.12 currently held by an FCM with a computation 26 68 FR at 40842. The Proposing Release also provides that if an FCM maintains based upon 150 percent of an FCM’s included a technical amendment to Rule 1.12(b) to minimum adjusted net capital correct the reference to SEC Rule 17a–11(b), which 23 68 FR at 40838. requirement, as determined by the the SEC has redesignated as 17a–11(c). 58 FR 37655 24 68 FR at 40837–8. margin-based capital requirements in (July 13, 1993.) 27 25 The Commission explained in the Proposing Rule 1.17(a)(1)(i)(B), as amended. The When an exchange increases margin Release that a DSRO is the self-regulatory requirements to reflect significant market moves, an organization that, pursuant to Commission Rule Commission also proposed to amend FCM’s margin-based capital requirements will 1.52, is primarily responsible for monitoring an Rule 1.12(b) to require that any FCM increase as well. FIA asserted that FCMs therefore FCM’s compliance with minimum financial and that did not meet or exceed its early will maintain some level of excess capital, as a related reporting requirements, receiving and matter of necessity as well as prudent business reviewing an FCM’s financial reports, and auditing warning capital level (whether based on practice, to enable them to respond to the more the FCM’s books and records. 68 FR at 40840, fn. the margin-based capital computation or immediate effect that significant market moves have 17. one of the other computations set forth on their risk-based capital requirements.
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monitor their member FCMs that may be establish an early warning capital level filed with the Commission does indicate experiencing financial stress. For for capital computations that are based that the Commission’s supervisory example, NFA requires each FCM for on the FCM’s margin requirements. As concerns can be addressed satisfactorily which it is the DSRO to report a variety the Commission has previously by an early warning capital level that is of information on a daily basis, explained, the requirements in Rule based on a different threshold including the FCM’s SPAN margin 1.12 ‘‘are designed to afford [the percentage of an FCM’s margin-based, or calculation, the FCM’s segregation Commission] and industry self- risk-based, minimum adjusted net requirements and the amount of funds regulatory organizations sufficient capital requirement. The JAC comment actually held in segregation. FIA stated advance notice of a firm’s financial or letter objected that, by its analysis, the its belief that information that the operational problems to take any proposed requirement of 150 percent of exchanges receive on a daily basis, such protective or remedial action that may a firm’s risk-based minimum capital as clearing house variation margin pay be needed to assure the safety of requirement would adversely affect the and collect information, along with customer funds and the integrity of the FCM industry as a whole by resulting in other reported information that is marketplace.’’ 28 After considering the an onerous increase in FCM capital available to them, provides the comments, the Commission continues to requirements as compared to the exchanges with sufficient data with believe that the effective Commission’s current rule. The JAC which to monitor the capital of a implementation of the financial therefore proposed that the Commission member FCM on a daily basis, if safeguards of the Act and its regulations should consider an alternative that necessary. requires provisions that establish a would be lower than 150 percent of an The JAC stated that the financial period for prompt reporting that a firm’s FCM’s margin-based minimum adjusted surveillance procedures implemented adjusted net capital does not meet or net capital requirement, if the by the exchanges and the NFA should exceed a specified level in excess of the Commission believed it necessary to provide sufficient advance notice of a FCM’s minimum adjusted net capital retain an early warning capital level. firm’s inability to meet its minimum requirement. Such provisions enhance The JAC stated that it believed that the capital requirement. The JAC also noted the ability of the Commission and DSRO adoption of such an alternative could that Rule 1.12 itself includes other to adjust appropriately the level of produce an early warning capital level requirements that serve to provide the monitoring of the FCM’s activities when that more closely parallels the current Commission and self-regulatory there appears to be circumstances that early warning capital level based upon organizations with notice of events that may detract from the FCM’s ability to six percent of the Segregated Amount, could impair the financial viability of an safeguard customer funds or otherwise and would therefore be far less FCM. Such requirements include those satisfy its financial obligations. burdensome upon FCMs and customers. set forth in paragraphs (c) and (d) Moreover, the provisions in other Commission staff has performed its which, as stated above, relate to notice paragraphs of Rule 1.12 cannot alone requirements to report deficiencies in own analysis of the effects of a revised serve to provide immediate, sufficient early warning capital level equal to 110 the FCM’s books and records or internal notice to the Commission of a material controls. The JAC further noted that percent of an FCM’s minimum adjusted change in a firm’s net capital net capital requirement, as determined Rule 1.12(g)(1–2) requires an FCM to requirements. For example, Rule provide written notice within two by the margin-based requirements 1.12(g)(1), which requires notice to the adopted by this rule. The analysis business days if any event or series of Commission if the amount of the FCM’s events cause a 20 percent or more indicates that the revised level would net capital declines by a specified reduction in the FCM’s net capital from cause FCMs to remain subject to an percentage, does not result in notice to the amount last reported to the obligation to provide notice to the the Commission if the FCM experiences Commission in a financial report, and a Commission and DSROs in advance of a material increase in its minimum minimum of two days advance notice the undercapitalization of the firm, but capital requirement, and the FCM does prior to any withdrawal of equity capital that the burden of such an obligation for not take appropriate steps to increase its or any unsecured advance or loan to any the industry as a whole would be no adjusted net capital. Absent Rule of the designated persons in the rule, if greater than experienced under the 1.12(b), the Commission would not such withdrawal, advance or loan Commission’s current regulations. receive notice of the change in such would cause a 30 percent or more net Based on financial data for all 182 FCMs reduction in the FCM’s excess adjusted firm’s capital position until the increase as of May 31, 2004, the analysis net capital. in the FCM’s minimum adjusted net indicates that 60 of the 182 FCMs would Finally, FIA also noted that capital requirement had exceeded the be subject to a risk-based minimum institutional clients generally insist that amount of adjusted net capital capital requirement, with the remaining 29 their FCMs maintain capital above any maintained by the FCM. 122 FCMs subject to either the SEC’s applicable early warning capital level, However, further review of data minimum capital requirement or the making the early warning capital level available from FCM financial reports Commission’s $250,000 minimum. Of an FCM’s effective minimum adjusted the 60 FCMs subject to risk-based 28 63 FR 45711 (August 27, 1998) (final rule capital requirements, the early warning net capital requirement. Accordingly, adopting amendments to shorten the time periods FIA and three other commenters stated for filing undercapitalization and undersegregation capital level of roughly half would be that many FCMs would be required to notices required by Rule 1.12). lower if determined by an amount equal maintain amounts of capital well in 29 The JAC letter included the comment that the to 110 percent of risk-based capital excess of 150 percent of the minimum Commission might consider, as an alternative to an rather than 6 percent of capital based on early warning capital level, modifying Rule adjusted net capital requirement if the 1.12(g)(2) to require notification if an FCM’s excess segregated funds, and the early warning early warning capital level were net capital decreases by more than 30 percent due capital level of the other firms would be established at 150 percent of margin- to an increase in its risk-based capital requirement. higher and, again, in every case the based adjusted net capital requirements. Unlike the JAC’s other proposal, it is difficult to early warning capital requirements, if gauge the sufficiency of the notice that would be The Commission appreciates the provided under this proposal, as compared to the triggered, would, like the minimum detailed and insightful comments requirements of the Commission’s existing rule or capital requirements, be driven by the received in response to its proposal to proposed amended rule. particular risk characteristics of the
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positions carried by the individual firm Commission.30 The Commission is The Commission believes that the in question. Furthermore, all of the therefore amending Rule 1.12(b)(3) to concerns expressed by these firms whose early warning capital level reduce to 110 percent the required commenters would be addressed by the would be greater under the amended percentage of adjusted net capital that is ‘‘know or should have known’’ standard rule already hold adjusted net capital in based on a margin-based capital already set forth in the rule. This same amounts that exceed the revised computation set forth in the rules of a standard applies to other notices requirement of 110 percent of their registered futures association, if the required by the Commission’s rules, margin-based minimum adjusted net amount of such margin-based adjusted and, with reference to the capital requirement. Thus, replacing the net capital meets or exceeds the amount undersegregation notices required under existing requirement of 6 percent of the computed under the margin-based Rule 1.12(h), the Commission has Segregated Amount with the revised computation set forth in Rule previously interpreted this standard as early warning capital level requirement 1.17(a)(1)(i)(B). This amendment will follows: would not require any FCM to increase help ensure that the same percentage of That part of the standard requiring an FCM its adjusted net capital in order to adjusted net capital will be required as to report when it ‘‘should know’’ of a comply with the amended rule. early warning capital whenever a problem may be defined as the point at In consideration of the foregoing, the margin-based computation in the rules which a party, in the exercise of reasonable Commission believes that a revised of a registered futures association is the diligence, should become aware of an early warning capital level of 110 same as the margin-based computation event.32 percent of the FCM’s margin-based in the Commission’s rules. With respect to the event at issue, i.e. minimum capital requirement would The Commission also received adjusted net capital that is less than the retain an advance notice requirement comments from the FIA and NFA required early warning capital level set that enhances the ability of the objecting to its proposal to reduce the forth in Rule 1.12(b), but still greater Commission and DSROs to monitor reporting period set forth in Rule than the minimum required to avoid effectively the financial condition of 1.12(b). Currently, Rule 1.12(b) requires becoming undercapitalized under Rule FCMs, while still remaining consistent that an FCM who ‘‘knows or should 1.12(a), it appears that reasonable with the goal of aligning an FCM’s have known’’ that its adjusted net diligence on the part of the FCM may capital requirements with the risks of its capital is below the early warning level include expeditious confirmation of activities. In addition, the Commission to file a written notice ‘‘within five (5) daily, intra-month estimates that have is in the process of enhancing its business days of such event.’’ With the been made in good faith and are financial surveillance capabilities over otherwise in compliance with firms and market participants through objective of harmonizing the Commission’s rule with the SEC’s early Commission regulations. Hence, if the use of automated systems that will confirmation of such estimates were utilize market position data and FCM warning rule, the Proposing Release included a proposal to amend the both timely and reasonably necessary, it financial data to assist Commission staff would be consistent with the amended with identifying situations that could phrase five business days to read 24 31 rule for an FCM to file its required adversely impact an FCM’s ability to hours. In response, the NFA and FIA notice within 24 hours of confirmation safeguard customer funds and meet its expressed concerns that the amended of such estimates, and compliance with financial obligations to the market. rule failed to recognize that although the amended rule would not be These automated programs will permit FCMs make daily computations of their impossible under procedures now used Commission staff to conduct stress capital, whenever such computations by FCMs. The Commission therefore testing and other scenario testing of the are made intra-month they are based on believes it appropriate to amend Rule positions held by both market estimates only. Moreover, FCMs 1.12(b) as proposed in the Proposing participants and FCMs to gauge the generally do not complete their daily Release, and is hereby amending the potential impact on such entities based capital computations until late rule to require an FCM to file written upon the positions they hold. The afternoon, and, given that FCMs Commission is therefore amending Rule conduct business internationally, FIA notice with the Commission and with 1.12(b)(2) to delete the early warning stated that it would be ‘‘impossible to the FCM’s DSRO within 24 hours after capital level based upon the Segregated confirm these numbers’’ within 24 it knows or should have known that its Amount, and to set forth in its place an hours from when such daily capital adjusted net capital is less than the early early warning capital level equal to 110 computations are made. FIA and NFA warning capital level. percent of the FCM’s margin-based therefore argued that FCMs should be B. Early Warning Requirements: Firm’s capital requirement as determined by permitted to continue to use established Books and Records and Internal amended Rule 1.17(a)(1)(i)(B). procedures to confirm their estimates Controls Adopting the amendment to and provide notice, if required, within Rule 1.12(c) currently requires any paragraph (b)(2) of Rule 1.12 also will five business days of the original FCM or IB that at any time fails to make necessitate a change to paragraph (b)(3) estimated daily capital computation. or keep current books and records of the rule, which currently sets forth an Moreover, FIA stated that it believed early warning capital level equal to ‘‘150 that it would be inappropriate to require required by Commission regulations to percent of the amount of adjusted net early warning notices based on be maintained to provide notice on the capital required by a registered futures unconfirmed estimates because such same day that such event occurs. The association of which [a firm] is a early warning notices are publicly notice must specify the books and member.’’ As noted above, every FCM available. records that have not been made or are must comply with the capital not current, and within five business days after providing such notice the requirements of NFA, a registered 30 The margin-based capital computation futures association. Furthermore, as included the NFA’s capital requirements for its FCM or IB must file a written report detailed above, NFA’s risk-based capital members is currently set forth in ¶ 7001 of the NFA Manual, Section 1(a)(vi) (2004). 32 63 FR 45711, 45713 (August 27, 1988) rule includes a risk-based requirement 31 SEC Rule 17a–11(c) requires notice by no later (adopting rules that would also apply ‘‘know or that is identical to the risk-based capital than 24 hours after the broker-dealer’s net capital should have known’’ standard for undersegregation computation being adopted by the falls below the SEC’s required early warning level. notices pursuant to Rule 1.12(h)).
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stating what steps have been and are Rule 1.17(h) for such ‘‘satisfactory’’ forth in Rule 1.17(a), including capital being taken to correct the situation. subordination agreements include computations based upon the Paragraph (d) of Rule 1.12 requires an several limitations upon the FCM’s or Segregated Amount. For example, Rule FCM or IB that discovers, or is notified IB’s ability to repay or prepay the 1.17(h)(3)(ii) and (h)(2)(viii)(A) require by an independent public accountant subordinated obligation. By way of such FCMs to suspend any repayment of their pursuant to Rule 1.16(e)(2), of the limitations, the Commission seeks to subordination agreements, and to existence of any material inadequacy as enhance the stability and permanence of provide notice of maturity/accelerated specified in Rule 1.16(d)(2), to provide the firm’s capital, and to prevent the maturity to the Commission, if the notice within three business days, and firm’s subordinated debt lenders from FCM’s payment obligations, then due or within five business days after giving withdrawing firm capital to the maturing within a specified period, such notice to file a written report detriment of the general creditors. would result in adjusted net capital of stating what steps have been and are One of the payment limitations less than 6 percent of the Segregated being taken to correct the material specified in Rule 1.17(h) prohibits any Amount. Furthermore, an FCM whose inadequacy. prepayment of the subordinated loan adjusted net capital would be less than For paragraphs (c) and (d) of Rule after the first year of the agreement 7 percent of the Segregated Amount is 1.12, the Proposing Release proposed to unless the firm maintains adjusted net subject to restrictions under Rule reduce the notice and reporting time capital in excess of the minimum 1.17(h)(2)(vi)(C) on any reductions of frames specified within these amount that would otherwise be the unpaid principal balance under a paragraphs to be the same as the time required under Rule 1.17(a).35 secured demand note subordination frames provided in corresponding SEC Specifically, Rule 1.17(h)(2)(vii)(A) agreement,37 and also subject to regulations governing registered restricts subordinated debt prepayments restrictions under Rule 1.17(h)(3)(v) on securities broker-dealers. Specifically, if such prepayments would cause the the use of temporary subordinations.38 the proposed revisions would require an FCM’s or IB’s adjusted net capital to be Finally, Rule 1.17(h)(2)(vii)(B) restricts FCM or IB: (i) To transmit within 48 less than the greater of: ‘‘special prepayments’’ by FCMs whose hours the required report stating what a. 120 percent of the minimum dollar adjusted net capital would be less than the FCM or IB has done or is doing to amount specified for FCMs in 10 percent of the Segregated Amount.39 correct the situation that has caused the 1.17(a)(1)(i)(A) or for IBs in In light of the amendments to Rule firm to fail to maintain current books 1.17(a)(1)(iii)(A) (for FCMs, the required 1.17(a) adopted by this rulemaking, the and records; and (ii) to notify the amount would be $300,000, or 120 capital computations within Rule Commission within 24 hours of percent of $250,000; for IB’s the 1.17(h) that are based on the Segregated discovering a material inadequacy in its required amount would be $36,000); 36 Amount must also be amended. accounting systems, and to transmit the b. For FCMs, 7 percent of the Furthermore, similar amendments are required report within 48 hours of such Segregated Amount; also required for Commission Rule discovery.33 None of the commenters c. 120 percent of the amount of 1.17(e), which sets forth the objected to the proposed shorter periods adjusted net capital required by a requirements for a firm’s ‘‘debt-equity in Rules 1.12(c) and (d) for FCMs and registered futures association of which total’’, i.e., the total of the outstanding IBs to file the required notices and the FCM is a member; or principal amount of satisfactory reports related to their books and d. For FCMs that also are registered subordination agreements plus the records and internal controls. The with the SEC as securities brokers or firm’s ‘‘equity capital’’.40 One of the Commission is adopting as final the dealers, the amount of net capital provisions of Rule 1.17(e) requires a amendments to paragraphs (c) and (d) as required by SEC Rule 15c3–1d(b)(7). specified percentage of minimum proposed in the Proposing Release.34 Several other provisions of Rule adjusted net capital based on the 1.17(h) also specify percentages of IV. Satisfactory Subordination minimum adjusted net capital to restrict 37 The subordination agreement may provide for Agreements and Equity Capital repayments or require action by firms in the FCM or IB to receive either (i) cash or (ii) a connection with their satisfactory demand note that is payable to the FCM or IB and Commission Rule 1.17(c)(4)(i) permits secured by cash or securities that satisfy an FCM or IB, in computing its adjusted subordination agreements. These requirements set forth in the rule. net capital, to exclude liabilities that are provisions specify percentages 38 Pursuant to several conditions specified in the subordinated to the claims of the firm’s applicable to each of the alternative rule, an FCM or IB may qualify for approval of a adjusted net capital computations set temporary satisfactory subordination agreement that general creditors if such subordinated has a stated term of no more than 45 days. liabilities arise under ‘‘satisfactory 39 ‘‘Special prepayments’’ is the term used in Rule 35 subordination agreements’’ as defined in Prior to the end of the first year, Rule 1.17 for prepayments made under revolving Rule 1.17(h). The criteria set forth in 1.17(h)(2)(vii) generally prohibits any prepayment subordinated agreements. Because revolving of the subordinated loan irrespective of whether the agreements may permit prepayments at any time, firm holds sufficient excess capital. such payments ordinarily would conflict with Rule 33 68 FR at 40842–3. 36 The Commission redesignated paragraph 1.17(h)(2)(vii)(prohibiting prepayment within one 34 The JAC proposed that the Commission also (a)(1)(ii)(A) of Rule 1.17 as paragraph (a)(1)(iii)(A) year of the date upon which the governing consider, in addition to the rule amendments that in 2001. 66 FR 53510 (October 23, 2001). The subordination agreement became effective.) In 1982, the Commission had proposed in the Proposing Commission therefore proposed technical the Commission determined that special Release to paragraphs (b), (c) and (d) of Rule 1.12, amendments to various subparagraphs of Rule prepayments would be acceptable if subject to an amendment to delete paragraph (f)(5) from Rule 1.17(h), and also to Rule 1.17(e), to correct all various conditions, including a higher level of 1.12. Rule 1.12(f)(5) currently obligates an FCM to references within those rules to 1.17(a)(1)(ii)(A) to minimum adjusted net capital (10 percent of provide notice immediately whenever its excess read 1.17(a)(1)(iii)(A). 68 FR at 40843. The segregated funds) than is required for prepayments adjusted net capital is less than 6 percent of the Commission has further determined that Rules that are subject to the one-year restriction (7 percent maintenance margin required by the FCM on all 1.10(j)(8)(ii)(A) and 1.17(a)(2)(ii) require similar of segregated funds). 47 FR 22352 (May 24, 1982). positions in accounts of a noncustomer. The JAC revision, as these rules also include references to 40 Rule 1.17(e) requires the firm to hold 30 stated that it believed that this regulation would no paragraph (a)(1)(ii) of Rule 1.17. The Commission percent of the total as equity capital. Rule 1.17(d)(1) longer be necessary because the risk-based capital is therefore adopting amendments to Rules 1.17(h) defines the term ‘‘equity capital’’ to include requirement includes an assessment for an FCM’s and (e) as proposed, and also is adopting similar retained earnings and other specified forms of exposure to noncustomer positions. Commission amendments to Rules 1.10(j)(8) and 1.17(a)(2). As investment. The term also includes funds received staff is reviewing this proposal for possible future amended, the existing references within these rules under subordination agreements that are not only publication as a proposed rule, with request for to paragraph (a)(1)(ii) of Rule 1.17 will be revised satisfactory under Rule 1.17(h), but also meet other, public comment. to read (a)(1)(iii). more restrictive criteria specified in Rule 1.17(d).
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Segregated Amount as a condition for reducing the proposed percentages, but adjusted net capital requirement as permitting an FCM or IB to make did not make any specific determined under amended Rule withdrawals of equity capital. recommendations for the percentages to 1.17(a)(1)(i)(B). Specifically, any withdrawal of equity be included in Rules 1.17(e) and (h). The Commission also proposed in the capital is prohibited if, among other Upon further consideration, the Proposing Release to amend Rule things, it would result in adjusted net Commission notes that in all but one of 1.17(h)(3)(vii) to ‘‘grandfather’’ in capital of less than 6 percent of the the relevant paragraphs of Rules 1.17(e) agreements that, prior to the effective Segregated Amount. and (h), the required percentage of date of the final rules as adopted, had In the Proposing Release, the minimum adjusted net capital is 120 been determined to be satisfactory Commission proposed to conform all of percent, regardless of whether the subordination agreements pursuant to the computations in paragraphs (e) and FCM’s capital computation is based on Rule 1.17(h).44 No commenter objected (h) of Rule 1.17 that refer to the a registered futures association’s capital to this proposal, and the Commission Segregated Amount to refer instead to requirements or on the FCM’s required adopts the amendment as proposed. the risk-based capital computation that minimum dollar amount ($250,000). V. Capital Charge for Undermargined was proposed in Rule 1.17(a)(1)(i)(B).41 This similarity is the product of the Accounts Under Rule 1.17(c)(5) The Commission stated that the Commission’s determination in 1995, proposed amendments would: (i) when proposing to amend Rules 1.17(e) Commission Rule 1.17(c)(5)(viii) Eliminate calculations based on the and (h) to include capital computations requires an FCM, in computing its Segregated Amount; (ii) adopt that would be based on the capital adjusted net capital, to take a reduction calculations based on the required requirements of a registered futures (i.e., capital charge) from its net capital maintenance margin for customer and association, to apply the same for any customer account that is noncustomer futures and option percentages as then required for capital undermargined and the margin call positions carried by an FCM; and (iii) computations based upon the minimum issued to the customer has not been apply percentage requirements that dollar amount set forth in Rule answered by the third business day reflect the same proportional increase 1.17(a)(1)(i)(A).43 Accordingly, the following the issuance of the call. Rule currently required under Rule 1.17(e) Commission has determined to take the 1.17(c)(5)(ix) requires an FCM to take a and (h).42 Thus, for example, where same approach here and reduce to 120 capital charge for noncustomer accounts Rule 1.17(e) included a calculation percent all but one of the percentages if a noncustomer fails to answer a based upon six percent of the proposed in the Proposing Release for margin call by the second business day Segregated Amount, the Commission Rules 1.17(e) and (h). The exception in following the issuance of the call. The proposed to eliminate this calculation the amended rule will be in paragraph capital charge under Rule 1.17(c)(5)(viii) and require 150 percent of an FCM’s (h)(2)(vii)(B), which restricts ‘‘special and (ix) is equal to the amount of funds risk-based minimum adjusted net prepayments’’ made under satisfactory required in the undermargined account capital requirement. Using this subordination agreements, and requires to meet maintenance margin approach for purposes of an FCM’s a computation of 200 percent of an requirements of the applicable board of equity capital and satisfactory FCM’s minimum adjusted net capital trade that the futures or options subordination agreements would result that is based on a minimum dollar contracts were executed on or the in required percentages of risk-based amount, i.e., 200 percent of $250,000. In clearing organization that cleared such minimum adjusted net capital of either light of the comments received on the transactions. For both customer and 150 percent or 175 percent, except that enhanced responsiveness of margin- noncustomer accounts, the Commission an FCM would be required to hold 250 based capital requirements to significant issued proposed rule amendments that percent of risk-based minimum adjusted major market moves, the Commission would reduce the collection period net capital in order to make ‘‘special believes that it is sufficient for the before a capital charge would have to be prepayments’’ under a satisfactory purposes of the identified paragraph to taken to one business day following the subordination agreement. amend the rule to require 125 percent of issuance of a margin call.45 Of the ten comment letters received minimum adjusted net capital that is Several commenters expressly by the Commission, the majority had no based on an FCM’s margin-based capital acknowledged that payment by comments on these proposed requirements. The Commission is electronic means within one day after conforming revisions to Rule 1.17(e) and therefore adopting the amendments to the issuance of a margin call reflects the (h). One FCM proposed 125 percent as Rule 1.17(e) and (h) as set forth in the current practice of the industry in many a specific alternative percentage for the Proposing Release, with the following instances, especially with respect to Commission to consider for all of the modifications: (1) the required institutional customers. FIA, NFA, and applicable provisions of Rule 1.17(e) percentage of risk-based minimum all five of the individual FCMs, and (h), while the NFA suggested using adjusted net capital will be 120 percent however, expressly objected to 120 percent, which is the same for subparagraphs (e)(1)(ii), shortening the period under Rule percentage that Rules 1.17(e) and (h) (h)(2)(vi)(C)(2), (h)(2)(vii)(A)(2), 1.17(c)(5)(viii) for outstanding margin currently require in the case of (h)(2)(viii)(A)(2), (h)(3)(ii)(B), and calls for customer accounts. The minimum adjusted net capital (h)(3)(v)(B) of Rule 1.17; and, (2) in prevailing theme of these comments is computations that are based on the subparagraph (h)(2)(vii)(B)(2), the that there remain instances in which capital requirements of a registered required percentage will be 125 percent meeting a margin call within one day futures association. The JAC suggested of an FCM’s risk-based minimum may not be possible, and is unrelated to that the Commission might consider any impaired financial capacity of the 43 The Commission’s approach is described in the customer to ultimately meet the margin 41 68 FR at 40843–4. Federal Register release proposing these call. 42 The cited paragraphs also contain references to amendments in 1995. 60 FR 63995, 63997, fn. 16. FIA also expressed its view that it is 1.17(a)(1)(ii)(A), which has been redesignated (Dec. 13, 1995). The proposed rules were adopted not necessary to reduce the period 1.17(a)(1)(iii)(A). The Commission therefore also in 1996. 60 FR 19177 (May 1, 1996). These rules proposed, and is now adopting, a technical were therefore adopted prior to NFA’s amendment amendment to correct the references in these of its capital rule, in 2000, to include a computation 44 68 FR at 40843. paragraphs to read as 1.17(a)(1)(iii)(A). based upon maintenance margin. 45 68 FR at 40839–40.
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currently applicable to customer the Commission might be insufficient the list of persons from whom the accounts to achieve the Commission’s for institutional trading managers to Commission would accept the oath or objectives. FIA pointed out that margin- meet their margin calls. FIA noted its affirmation that is required by Rule based capital requirements are sufficient understanding that the reconciliation 1.10(d)(4).48 FIA, NFA and the JAC to address the Commission’s concerns process for trades executed on behalf of expressed support for the proposals to articulated in the Proposing Release, institutional trading managers can amend Rules 1.10(b), 1.10(d)(4) and particularly the fact that the futures extend into the business day following 1.18. The Commission has determined industry has recently experienced the trade date, resulting from a number to amend Rules 1.10(b) and 1.18 as significant increases in the number of of factors, including late give-ins. proposed, but to revise the text products offered on futures markets, and Because these entities actively manage amendments that were suggested for the higher volatility associated with their cash assets, excess cash must be Rule 1.10(d)(4) in the Proposing Release. some of these products. Several of FIA’s invested early in the day in order to A. Oath and Affirmation Requirements comments also questioned the enhance available yield, and these Commission’s assumption concerning trading managers establish early Rule 1.10(d)(4) seeks to ensure that the ease and convenience of meeting morning cut-off times for the receipt of the required oath or affirmation is margin calls in one day through the margin calls. Although trading managers provided by persons that have authority electronic transfer of funds. First, FIA generally receive preliminary margin to bind the FCM or IB, who also have observed that an international client calls before the early morning cut-off, an appropriate level of ongoing financial might receive a margin call after the the size of the call may not be confirmed and/or managerial responsibility for the closing hours of banks where its until after the established cut-off time, financial information provided in the accounts are maintained, or during a thus possibly resulting in delays beyond reports filed with the Commission, and holiday schedule applicable in the the one-business-day period being who should be bound by the personal bank’s location. FIA further stated that proposed by the Commission. attestation. Consistent with this it might take more than the prescribed Upon reviewing the comments purpose, Rule 1.10(d)(4) currently period to resolve funds that have been received, the Commission has requires the signature of a chief mistakenly misdirected. Finally, FIA determined not to adopt the proposed operating officer, chief financial officer, pointed out that retail clients generally amendments to Rules 1.17(c)(5)(viii) general partner, or sole proprietor, if the continue to meet margin calls by means and (ix) that were set forth in the FCM or IB is organized as a corporation, of a check rather than a wire transfer. Proposing Release. The amendments partnership or sole proprietorship, Two FCMs and the NIBA commented were not proposed in response to respectively. that a number of small to medium observed specific deficiencies in the As noted in the Proposing Release, the business entities, including small FCMs’ processes for the collection of existing list of approved individuals in commercial hedgers and agricultural margin, and the Commission is Rule 1.10(d)(4) does not address other interests, also meet margin calls through persuaded that the existing Commission organizational structures under which check payments. In many cases, and exchange rules continue to FCMs and IBs may conduct their according to one FCM, the cost of using reinforce the industry’s own practices business, specifically, limited liability a wire transfer could be a significant for collecting margin as soon as companies (‘‘LLCs’’). All fifty states and percentage of the margin call. If the possible, while taking into the District of Columbia have passed FCM does not require that its customers consideration circumstances that may statutes in recent years allowing incur such wire transfer fees, the FCM result in margin not being paid within formation of LLCs within their will incur a capital charge for serving one day of the issuance of a margin call jurisdictions.49 LLCs are unincorporated this market. Another FCM commented which are commercially reasonable and entities that, in accordance with the that the costs of requiring payment by not indicative of any impaired financial relevant LLC statute, may be managed wire transfer, for which most bank capacity of the recipient to ultimately by their members directly or by charge substantial fees, would impose a meet the margin call. managers whose duties are defined by burden on the market participation of the statute and/or by agreement of the these customers, and the increased cost VI. Financial Reporting Requirements members.50 While some LLCs include associated with servicing this market The Proposing Release included the positions of chief executive officer segment could result in higher amendments to Rule 1.10(b) to require and chief financial officer, others do commissions and lower market access each FCM to file an unaudited Form 1– not. As of February 29, 2004, at least 40 for the retail customer. FR–FCM, or FOCUS Report for an FCM of the 177 registered FCMs were For those FCMs with a retail client also registered with the SEC as a organized as LLCs. base, therefore, FIA stated that it is securities broker or dealer, with the In response to the need to modernize impractical to expect the receipt of Commission and with the FCM’s DSRO Rule 1.10(d)(4), the Proposing Release margin payment within less than three as of the end of each month, including suggested revisions to the rule that business days. FIA further noted that a the FCM’s fiscal year end. Such would be consistent with amendments number of U.S. futures contracts are financial reports are required to be filed then pending to Part 4 of the denominated in a foreign currency, and within 17 business days of the end of Commission’s rules.51 The proposed it can take two business days to settle each month.46 The preparation of such amendments focused on the authority of a wire transfer for many of these monthly financial reports also would the signer to bind the FCM or IB, but the currencies. One FCM noted that even satisfy an FCM’s requirement to prepare Commission believes that it is with only a moderate retail and foreign and to maintain a monthly formal customer base, it anticipated having to computation of its adjusted net capital 48 68 FR at 40841, 40846. double or triple its daily undermargined under Rule 1.18(b).47 The Commission 49 Susan P. Hamill, The Origins Behind the capital charge. also proposed to facilitate Form 1–FR Limited Liability Company, 59 Ohio St. L.J. 1459 Apart from issues related to the use of (1998). filings by FCMs and IBs by expanding 50 Larry E. Ribstein and Robert R. Keatinge, wire transfers to meet margin calls, FIA Ribstein and Keatinge on Limited Liability and NFA also expressed concerns that 46 68 FR at 40840, 40845. Companies, §§ 1.3, 1.6, and 8.2 (2003). the shorter time period contemplated by 47 68 FR at 40841, 40848. 51 68 FR at 40841.
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additionally appropriate to ensure that financial statements solely with NFA. potential paperwork burden associated persons who submit financial NFA supported having IBs file solely with regulation.59 information to the Commission hold with NFA both unaudited and audited C. Cost-Benefit Analysis positions within the firm that require financial reports, and no commenters meaningful familiarity with, and objected to these proposals. Having Section 15(a) of the Act, as amended responsibility for, the ongoing considered these proposals, the by section 119 of the CFMA, requires operations and finances of the firm. The Commission hereby amends Rule the Commission to consider the costs Commission has therefore determined to 1.10(c) to provide that IBs will file the and benefits of its action before issuing adopt amendments to Rule 1.10(d)(4) to unaudited Form 1–FRs required by Rule a new regulation under the Act. By its designate, for each form of business 1.10(b)(2)(i), and the annual certified terms, section 15(a) as amended does organization, the officers or other financial statements required by Rule not require the Commission to quantify individuals from whom the oath or 1.10(b)(2)(ii), with NFA only. the costs and benefits of a new affirmation would be required, as The Proposing Release included regulation or to determine whether the follows: if a sole proprietorship, the amendments that would permit an benefits of the regulation outweigh its proprietor; if a partnership, any general FCM’s or IB’s DSRO, or, as applicable, costs. Rather, section 15(a) simply partner; if a corporation, the chief its designated examining authority requires the Commission to ‘‘consider executive officer or chief financial under SEC rules, to approve the FCM’s the costs and benefits’’ of its action. Section 15(a) of the Act further officer; and, if a limited liability or IB’s application for change in fiscal specifies that costs and benefits shall be company or limited liability year under Rule 1.10(e), or an evaluated in light of five broad areas of partnership, the chief executive officer, application for an extension of time to market and public concern: protection the chief financial officer, the manager, file an audited or unaudited financial of market participants and the public; the managing member, or those statement under Rules 1.10(f) or 1.16(f), efficiency, competitiveness, and members vested with the management subject to specified conditions.55 The financial integrity of futures markets; authority for the limited liability Commission is adopting as final the price discovery; sound risk management company or limited liability proposed amendments to Rules 1.10(e) 52 practices; and other public interest partnership. As amended, Rule and (f) and 1.16(f), with some considerations. Accordingly, the 1.10(d)(4) uses some of the same terms modifications from the versions set forth Commission could in its discretion give that were adopted by the Commission in the Proposing Release. These greater weight to any one of the five when modernizing Commission modifications have been made to reflect enumerated areas and could in its Regulation 3.1(a) in 2001 to recognize the amendments to Rule 1.10(c) that discretion determine that, the existence of limited liability will require IBs to file their uncertified 53 notwithstanding its costs, a particular companies. and certified financial reports solely The Proposing Release also proposed rule was necessary or appropriate to with NFA.56 to amend Rule 1.10(d)(4) to permit the protect the public interest or to oath or affirmation, if the registrant or VII. Related Matters effectuate any of the provisions or to applicant is registered with the SEC as accomplish any of the purposes of the A. Regulatory Flexibility Act a securities broker or dealer, to be Act. provided by the representative The Regulatory Flexibility Act The amended rules adopted by the authorized under SEC Rule 17a–5. The (‘‘RFA’’), 5 U.S.C. 601 et seq., requires Commission pertain to the minimum Commission adopts this amendment as that agencies, in proposing rules, financial and related reporting proposed in the Proposing Release. consider the impact of those rules on requirements for FCMs and IBs.60 The Commission is considering the costs B. Filings With NFA and Other small businesses. The Commission and benefits of these various proposed Reporting Requirements invited the public to comment on the Chairman’s certification that these rules rules in light of the specific provisions The Commission proposed to amend would not have a significant economic of section 15(a) of the Act, as follows: Rule 1.10(c) to provide that an IB would impact on a substantial number of small 1. Protection of market participants file an unaudited Form 1–FR–IB solely entities.57 The Commission received no and the public. The amended rules for 54 with NFA. The Proposing Release comments on the certification. reporting requirements provide the additionally invited comment on benefit of aiding the Commission and whether, and under what conditions, B. Paperwork Reduction Act DSROs to monitor the financial the Commission should amend its rules condition of futures intermediaries and This rulemaking includes information to permit IBs to file annual certified to protect the customers of those firms collection requirements. As required by and the markets. The Commission the Paperwork Reduction Act of 1995 52 A limited liability partnership is a general anticipates that the costs of compliance (‘‘PRA’’),58 the Commission submitted a partnership which, as a result of a filing with the with the amended reporting secretary of state (and, in some cases, the copy of the proposed rule amendments requirements will be minimized by maintenance of a certain level of insurance and the to the Office of Management and Budget payment of an annual fee to the state) limits the amended rules that will streamline (‘‘OMB’’) for its review. No comments vicarious liability of the partners. See Larry E. filing requirements. In addition, the were received in response to the Ribstein and Robert R. Keatinge, Ribstein and amended rules will ‘‘grandfather’’ in Keatinge on Limited Liability Companies, § 16.28 Commission’s invitation in the existing satisfactory subordination (2003). proposed rules to comment on any 53 Commission Regulation 3.1(a) specifies those ‘‘principals’’ that are required under the Act to 59 68 FR at 40844. 55 register with the Commission. Rule 3.1(a)(1) 68 FR at 40841–2, 40846–40847. 60 Section 4f(b) of the Act prohibits persons from includes as principals ‘‘any director, the president, 56 Most significantly, the modified versions becoming registered as FCMs or IBs if they do not chief executive officer, chief operating officer, chief eliminate the requirement that IBs file with the meet the minimum financial requirements set forth financial officer, the manager, managing member or Commission copies of their applications for changes in either the Commission’s regulations or in such those members vested with the management in fiscal year or extended filing deadlines, or the Commission-approved requirements as may be authority’’ for a limited liability company or limited notices approving or denying such applications. established by the contract markets and derivatives liability partnership. 57 68 FR at 40844. transaction execution facilities of which the FCM or 54 68 FR at 40842, 40845. 58 44 U.S.C. 3507(d). IB is a member.
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agreements, meaning that FCMs or IBs Authority: 7 U.S.C. 1a, 2, 5, 6, 6a, 6b, 6c, with jurisdiction over the state in which would incur no costs to comply with 6d, 6e, 6f, 6g, 6h, 6i, 6j, 6k, 6l, 6m, 6n, 6o, the registrant’s principal place of proposed amendments to Rule 1.17, 6p, 7, 7a, 7b, 8, 9, 12, 12a, 12c, 13a, 13a–1, business is located and by the unless such agreements would be 16, 16a, 19, 21, 23, and 24, as amended by designated self-regulatory organization, the Commodity Futures Modernization Act of amended or renewed for other reasons. 2000, appendix E of Pub. L. 106–554, 114 if any; and reports required to be filed 2. Efficiency and competition. As Stat. 2763 (2000). by this section by an applicant for stated above, the Commission registration will be considered filed anticipates that the amended rules will I 2. Section 1.10 is amended by revising when received by the National Futures benefit efficiency by eliminating paragraphs (b)(1), (b)(2)(i), (c), (d)(4), (e), Association and by the regional office of duplicate filings and otherwise and (f) to read as follows: the Commission with jurisdiction over streamlining reporting requirements for § 1.10 Financial reports of futures the state in which the applicant’s FCMs and IBs. The amended rules commission merchants and introducing principal place of business is located. should have no effect, from the brokers. (2) Any report filed pursuant to paragraph (b)(1) or (b)(4) of this section standpoint of imposing costs or creating * * * * * or § 1.12(a) which need not be certified benefits, on competition in the futures (b) Filing of financial reports. (1)(i) in accordance with § 1.16 may be and options markets. Except as provided in paragraphs (b)(3) submitted to the Commission in 3. Financial integrity of futures and (h) of this section, each person electronic form using a Commission- markets and price discovery. The registered as a futures commission assigned Personal Identification amended rules contribute to the benefit merchant must file a Form 1–FR–FCM Number, and otherwise in accordance of ensuring that FCMs and IBs can meet as of the close of business each month. with instructions issued by the their financial obligations to customers Each Form 1–FR–FCM must be filed no Commission, if the futures commission and other market participants, thus later than 17 business days after the date contributing to the financial integrity of merchant, introducing broker or a for which the report is made. designated self-regulatory organization the futures and options markets as a (ii) In addition to the monthly has provided the Commission with the whole. The amended rules should have financial reports required by paragraph means necessary to read and to process no effect, from the standpoint of (b)(1)(i) of this section, each person the information contained in such imposing costs or creating benefits, on registered as a futures commission report. the price discovery function of such merchant must file a Form 1–FR–FCM (3) Any information required of a markets. as of the close of its fiscal year, which registrant by a self-regulatory 4. Sound risk management practices. must be certified by an independent organization pursuant to paragraph The amended rules for capital public accountant in accordance with (b)(4) of this section need be furnished requirements seek to reflect § 1.16, and must be filed no later than only to such self-regulatory organization appropriately the level of risk that 90 days after the close of the futures and the Commission, and any different activities and obligations of commission merchant’s fiscal year: information required of a registrant by FCMs and IBs may pose to their Provided, however, that a registrant the National Futures Association financial condition. The amended rules which is registered with the Securities pursuant to paragraph (b)(4) of this may therefore contribute to the sound and Exchange Commission as a section need be furnished only to the risk management practices of futures securities broker or dealer must file this National Futures Association and the intermediaries. report not later than the time permitted Commission. 5. Other public interest for filing an annual audit report under (4) Any guarantee agreement entered considerations. The Commission § 240.17a–5(d)(5) of this title. into between a futures commission believes that the amended rules are (2)(i) Except as provided in merchant and an introducing broker in beneficial in that they harmonize paragraphs (b)(3) and (h) of this section, accordance with the provisions of this Commission and SEC rules with respect and except for an introducing broker section need be filed only with, and will to time frames for reporting conditions operating pursuant to a guarantee be considered filed when received by, that may be potentially adverse to the agreement which is not also a securities the National Futures Association. financial condition of the FCM or IB. broker or dealer, each person registered (d) * * * The Commission invited, but did not as an introducing broker must file a (4) Attached to each Form 1–FR filed receive, public comment on its Form 1–FR–IB semiannually as of the pursuant to this section must be an oath application of the cost-benefit provision. middle and the close of each fiscal year or affirmation that to the best knowledge After considering these factors, the unless the introducing broker elects, and belief of the individual making such Commission has determined to issue pursuant to paragraph (e)(1) of this oath or affirmation the information this final rule. section, to file a Form 1–FR–IB contained in the Form 1–FR is true and semiannually as of the middle and the correct. The individual making such List of Subjects in 17 CFR Part 1 close of each calendar year. Each Form oath or affirmation must be: Brokers, Commodity futures, 1–FR–IB must be filed no later than 17 (i) If the registrant or applicant is a Reporting and recordkeeping business days after the date for which sole proprietorship, the proprietor; if a requirements. the report is made. partnership, any general partner; if a * * * * * corporation, the chief executive officer I For the reasons presented above, the (c) Where to file reports. (1) A report or chief financial officer; and, if a Commission hereby amends 17 CFR part filed by an introducing broker pursuant limited liability company or limited 1 as follows: to paragraph (b)(2)(i) or (b)(2)(ii) of this liability partnership, the chief executive PART 1—GENERAL REGULATIONS section need be filed only with, and will officer, the chief financial officer, the UNDER THE COMMODITY EXCHANGE be considered filed when received by, manager, the managing member, or ACT the National Futures Association. Other those members vested with the reports provided for in this section will management authority for the limited I 1. The authority citation for part 1 be considered filed when received by liability company or limited liability continues to read as follows: the regional office of the Commission partnership; or
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(ii) If the registrant or applicant is copies of any notice or application filed section without substantial undue registered with the Securities and with its designated examining authority, hardship, it may request approval for an Exchange Commission as a securities pursuant to § 240.17a–5(d)(1)(i) of this extension of time, as follows: broker or dealer, the representative title, for a change in fiscal year or ‘‘as (i) Futures commission merchant authorized under § 240.17a–5 of this of’’ date for its annual audited financial registrants. (A) A futures commission title to file for the securities broker or statement. The registrant must also file merchant may file with its designated dealer its Financial and Operational immediately with the designated self- self-regulatory organization an Combined Uniform Single Report under regulatory organization and the application for extension of time, a copy the Securities Exchange Act of 1934, Commission copies of any notice it of which the registrant must file with part II or part IIA. In the case of a Form receives from its designated examining the Commission. The application shall 1–FR filed via electronic transmission in authority to approve or deny the be approved or denied in writing by the accordance with procedures established registrant’s request for change in fiscal designated self-regulatory organization. by the Commission, such transmission year or ‘‘as of’’ date. Upon the receipt The registrant must file immediately must be accompanied by the by the designated self-regulatory with the Commission a copy of any Commission-assigned Personal organization and the Commission of notice it receives from the designated Identification Number of the authorized copies of any such notice of approval, self-regulatory organization to approve signer and such Personal Identification the change in fiscal year or ‘‘as of’’ date or deny the registrant’s request for Number will constitute and become a referenced in the notice shall be deemed extension of time. A written notice of substitute for the manual signature of approved under this paragraph (e)(2). approval shall become effective upon the authorized signer for the purpose of (C) Any copy that under this the filing by the registrant of a copy making the oath or affirmation referred paragraph (e)(2) is required to be filed with the Commission, and a written to in this paragraph. with the Commission shall be filed with notice of denial shall be effective as of (e) Election of fiscal year. (1) An the regional office of the Commission the date of the notice. applicant wishing to establish a fiscal with jurisdiction over the state in which (B) A futures commission merchant year other than the calendar year may the registrant’s principal place of that is registered with the Securities and do so by notifying the National Futures business is located, and any copy or Exchange Commission as a securities Association of its election of such fiscal application to be filed with the broker or dealer may file with its year, in writing, concurrently with the designated self-regulatory organization designated self-regulatory organization a filing of the Form 1–FR pursuant to shall be filed at its principal place of copy of any application that the paragraph (a)(2) of this section, but in business. registrant has filed with its designated no event may such fiscal year end more (iii) Introducing broker registrants. (A) examining authority, pursuant to than one year from the date of the Form An introducing broker may file with the § 240.17–a5(l)(5) of this title, for an 1–FR filed pursuant to paragraph (a)(2) National Futures Association an extension of time to file its FOCUS of this section. An applicant that does application to change its fiscal year, report. The registrant must also file not so notify the National Futures which shall be approved or denied in immediately with the designated self- Association will be deemed to have writing. regulatory organization and the elected the calendar year as its fiscal (B) An introducing broker that is Commission copies of any notice it year. registered with the Securities and receives from its designated examining (2) (i) A registrant must continue to Exchange Commission as a securities authority to approve or deny the use its elected fiscal year, calendar or broker or dealer may file with the requested extension of time. Upon otherwise, unless a change in such fiscal National Futures Association copies of receipt by the designated self-regulatory year has been approved pursuant to this any notice or application filed with its organization and the Commission of paragraph (e)(2). designated examining authority, copies of any such notice of approval, (ii) Futures commission merchant pursuant to § 240.17a–5(d)(1)(i) of this the requested extension of time registrants. (A) A futures commission title, for a change in fiscal year or ‘‘as referenced in the notice shall be deemed merchant may file with its designated of’’ date for its annual audited financial approved under this paragraph (f)(1). self-regulatory organization an statement. The registrant must also file (C) Any copy that under this application to change its fiscal year, a immediately with the National Futures subparagraph (f)(1)(i) is required to be copy of which the registrant must file Association copies of any notice it filed with the Commission shall be filed with the Commission. The application receives from its designated examining with the regional office of the shall be approved or denied in writing authority to approve or deny the Commission with jurisdiction over the by the designated self-regulatory registrant’s request for change in fiscal state in which the registrant’s principal organization. The registrant must file year or ‘‘as of’’ date. Upon the receipt place of business is located. immediately with the Commission a by the National Futures Association of (ii) Introducing broker registrants. (A) copy of any notice it receives from the copies of any such notice of approval, An introducing broker may file with the designated self-regulatory organization the change in fiscal year or ‘‘as of’’ date National Futures Association an to approve or deny the registrant’s referenced in the notice shall be deemed application for extension of the time, application to change its fiscal year. A approved under this paragraph (e)(2). which shall be approved or denied in written notice of approval shall become (f) Extension of time for filing writing. effective upon the filing by the uncertified reports. (1) In the event a (B) An introducing broker that is registrant of a copy with the registrant finds that it cannot file its registered with the Securities and Commission, and a written notice of Form 1–FR, or, in accordance with Exchange Commission as a securities denial shall be effective as of the date paragraph (h) of this section, its broker or dealer may file with the of the notice. Financial and Operational Combined National Futures Association copies of (B) A futures commission merchant Uniform Single Report under the any application that the registrant has that is registered with the Securities and Securities Exchange Act of 1934, part II filed with its designated examining Exchange Commission as a securities or part IIA (FOCUS report), for any authority, pursuant to § 240.17–a5(l)(5) broker or dealer may file with its period within the time specified in of this title, for an extension of time to designated self-regulatory organization paragraphs (b)(1)(i) or (b)(2)(i) of this file its FOCUS report. The registrant
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must also file immediately with the the applicant or registrant is subject; members which is registered as a futures National Futures Association copies of and commission merchant or as a leverage any notice it receives from its * * * * * transaction merchant must be liquidated designated examining authority to (b) * * * immediately, transferred immediately or approve or deny the requested extension (1) 150 percent of the minimum dollar that the trading of any account of such of time. Upon the receipt by the amount required by § 1.17(a)(1)(i)(A); futures commission merchant or such National Futures Association of a copy (2) 110 percent of the amount leverage transaction merchant shall be of any such notice of approval, the required by § 1.17(a)(1)(i)(B); only for the purposes of liquidation, requested extension of time referenced (3) 150 percent of the amount of because that clearing member has failed in the notice shall be deemed approved adjusted net capital required by a to meet a call for margin or to make under this subparagraph (f)(1(ii). registered futures association of which it other required deposits, the clearing (2) In the event an applicant finds that is a member, unless such amount has organization must immediately give it cannot file its report for any period been determined by a margin-based telephonic notice, confirmed in writing within the time specified in paragraph capital computation set forth in the immediately by facsimile notice, of such (b)(4) of this section without substantial rules of the registered futures a determination to the principal office of undue hardship, it may file with the association, and such amount meets or the Commission at Washington, DC. National Futures Association an exceeds the amount of adjusted net (2) Whenever a registered futures application for an extension of time to capital required under the margin-based commission merchant determines that any position it carries for another a specified date which may not be more capital computation set forth in registered futures commission merchant than 90 days after the date as of which § 1.17(a)(1)(i)(B), in which case the or for a registered leverage transaction the financial statements were to have required percentage is 110 percent, or merchant must be liquidated been filed. The application must state (4) For securities brokers or dealers, immediately, transferred immediately or the reasons for the requested extension the amount of net capital specified in that the trading of any account of such and must contain an agreement to file Rule 17a–11(c) of the Securities and futures commission merchant or the report on or before the specified Exchange Commission (17 CFR leverage transaction merchant shall be date. The application must be received 240.17a–11(c)), must file written notice only for purposes of liquidation, by the National Futures Association to that effect as set forth in paragraph (i) because the other futures commission before the time specified in paragraph of this section within twenty-four (24) merchant or the leverage transaction (b)(4) of this section for filing the report. hours of such event. merchant has failed to meet a call for Notice of such application must be filed (c) If an applicant or registrant at any margin or to make other required with the regional office of the time fails to make or keep current the deposits, the carrying futures Commission with jurisdiction over the books and records required by these commission merchant must state in which the applicant’s principal regulations, such applicant or registrant immediately give telephonic notice, place of business is located concurrently must, on the same day such event confirmed in writing immediately by with the filing of such application with occurs, provide facsimile notice of such facsimile notice, of such a the National Futures Association. fact, specifying the books and records determination to the principal office of Within ten calendar days after receipt of which have not been made or which are the Commission at Washington, DC. the application for an extension of time, not current, and within forty-eight (48) (3) Whenever a registered futures the National Futures Association shall: hours after giving such notice file a commission merchant determines that (i) Notify the applicant of the grant or written report stating what steps have an account which it is carrying is denial of the requested extension; or been and are being taken to correct the undermargined by an amount which (ii) Indicate to the applicant that situation. exceeds the futures commission additional time is required to analyze (d) Whenever any applicant or merchant’s adjusted net capital the request, in which case the amount registrant discovers or is notified by an determined in accordance with § 1.17, of time needed will be specified. independent public accountant, the futures commission merchant must pursuant to § 1.16(e)(2) of this chapter, * * * * * immediately give telephonic notice, of the existence of any material confirmed in writing immediately by I 3. Section 1.12 is amended by revising inadequacy, as specified in § 1.16(d)(2) facsimile notice, of such a paragraphs (a)(1), (b)(1), (b)(2), (b)(3), of this chapter, such applicant or determination to the designated self- (b)(4), (c), (d), (e), (f), (h) and (i)(1) to read registrant must give facsimile notice of regulatory organization and the as follows: such material inadequacy within principal office of the Commission at twenty-four (24) hours, and within Washington, DC. This paragraph (f)(3) § 1.12 Maintenance of minimum financial forty-eight (48) hours after giving such requirements by futures commission shall apply to any account carried by merchants and introducing brokers. notice file a written report stating what the futures commission merchant, steps have been and are being taken to whether a customer, noncustomer, (a) * * * correct the material inadequacy. omnibus or proprietary account. For (1) Give telephonic notice, to be (e) Whenever any self-regulatory purposes of this paragraph (f)(3), if any confirmed in writing by facsimile organization learns that a member person has an interest of 10 percent or notice, as set forth in paragraph (i) of registrant has failed to file a notice or more in ownership or equity in, or this section that the applicant’s or written report as required by § 1.12, that guarantees, more than one account, or registrant’s adjusted net capital is less self-regulatory organization must has guaranteed an account in addition than required by § 1.17 or by other immediately report this failure by to his own account, all such accounts capital rule, identifying the applicable telephone, confirmed in writing shall be combined. A designated self- capital rule. The notice must be given immediately by facsimile notice, as regulatory organization may grant an immediately after the applicant or provided in paragraph (i) of this section. exemption from the provisions of this registrant knows or should know that its (f)(1) Whenever a clearing paragraph to a futures commission adjusted net capital is less than required organization determines that any merchant with respect to any particular by any of the aforesaid rules to which position it carries for one of its clearing account on a continuous basis provided
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the designated self-regulatory facsimile notice, to the registrant’s designated self-regulatory organization organization documents the reasons for designated self-regulatory organization to approve or deny the registrant’s granting such an exemption and and the principal office of the request for extension of time. A written continues to monitor any such account. Commission in Washington, DC, to the notice of approval shall become (4) A futures commission merchant attention of the Director and the Chief effective upon the filing by the shall report immediately by telephone, Accountant of the Division of Clearing registrant of a copy with the confirmed immediately in writing by and Intermediary Oversight. Commission, and a written notice of facsimile notice, whenever any (i)(1) Every notice and written report denial shall be effective as of the date commodity interest account it carries is required to be given or filed by this of the notice. subject to a margin call, or call for other section (except for notices required by (B) A futures commission merchant deposits required by the futures paragraph (f) of this section) by a futures that is registered with the Securities and commission merchant, that exceeds the commission merchant, an applicant for Exchange Commission as a securities futures commission merchant’s excess registration as a futures commission broker or dealer may file with its adjusted net capital, determined in merchant or a self-regulatory designated self-regulatory organization a accordance with § 1.17, and such call organization must be filed with the copy of any application that the has not been answered by the close of regional office of the Commission with registrant has filed with its designated business on the day following the jurisdiction over the state in which the examining authority, pursuant to issuance of the call. This applies to all applicant’s or registrant’s principal § 240.17–a5(l)(1)of this title, for an accounts carried by the futures place of business is located, with the extension of time to file audited annual commission merchant, whether designated self-regulatory organization, financial statements. The registrant customer, noncustomer, or omnibus, if any, with the Securities and Exchange must also file immediately with the that are subject to margining, including Commission, if such applicant or designated self-regulatory organization commodity futures and options. In registrant is a securities broker or dealer, and the Commission copies of any addition to actual margin deposits by an and with the National Futures notice it receives from its designated account owner, a futures commission Association, if the firm is an applicant. examining authority to approve or deny merchant may also take account of In addition, every notice required to be the requested extension of time. Upon favorable market moves in determining given by this section must also be filed receipt by the designated self-regulatory whether the margin call is required to be with the principal office of the organization and the Commission of reported under this paragraph. Commission in Washington, DC. Each copies of any such notice of approval, (5)(i) A futures commission merchant statement of financial condition, each the requested extension of time shall report immediately by telephone, statement of the computation of the referenced in the notice shall be deemed confirmed immediately in writing by minimum capital requirements pursuant approved under this paragraph (f)(1)(i). (C) Any copy that under this facsimile notice, whenever its excess to § 1.17 of this part, and each schedule paragraph (f)(1)(i) is required to be filed adjusted net capital is less than six of segregation requirements and funds with the Commission shall be filed with percent of the maintenance margin on deposit in segregation required by the regional office of the Commission required by the futures commission this section must be filed in accordance with jurisdiction over the state in which merchant on all positions held in with the provisions of § 1.10(d) of this the registrant’s principal place of accounts of a noncustomer other than a part unless otherwise indicated. * * * * * business is located. noncustomer who is subject to the (ii) Introducing broker registrants. (A) I 4. Section 1.16 is amended by revising minimum financial requirements of: An introducing broker may file with the paragraph (f) to read as follows: (A) A futures commission merchant, National Futures Association an or § 11.16 Qualifications and reports of application for extension of time, which (B) The Securities and Exchange accountants. shall be approved or denied in writing. Commission for a securities broker and * * * * * (B) An introducing broker that is dealer. (f)(1) Extension of time for filing registered with the Securities and (ii) For purposes of paragraph (f)(5)(i) audited reports. In the event a registered Exchange Commission as a securities of this section, maintenance margin futures commission merchant or a broker or dealer may file with the shall include all deposits which the registered introducing broker finds that National Futures Association copies of futures commission merchant requires it cannot file, without substantial undue any application that the registrant has the noncustomer to maintain in order to hardship, its certified financial filed with its designated examining carry its positions at the futures statements and schedules for any year authority, pursuant to § 240.17–a5(l)(1) commission merchant. within the time specified in § 1.10 of this title, for an extension of time to * * * * * (b)(1)(ii) or § 1.10 (b)(2)(ii) of this part, file audited annual financial statements. (h) Whenever a person registered as a as applicable, such registrants may The registrant must also file futures commission merchant knows or request approval for an extension of immediately with the National Futures should know that the total amount of its time, as follows: Association copies of any notice it funds on deposit in segregated accounts (i) Futures commission merchant receives from its designated examining on behalf of customers, or that the total registrants. (A) A futures commission authority to approve or deny the amount set aside on behalf of customers merchant may file with its designated requested extension of time. Upon the trading on non-United States markets, is self-regulatory organization an receipt by the National Futures less than the total amount of such funds application for an extension of time, a Association of a copy of any such notice required by the Act and the copy of which the registrant must file of approval, the requested extension of Commission’s rules to be on deposit in with the Commission. The application time referenced in the notice shall be segregated or secured amount accounts shall be approved or denied in writing deemed approved under this paragraph on behalf of such customers, the by the designated self-regulatory (f)(1)(ii). registrant must report such deficiency organization. The registrant must file (2) Exemption requests. On the immediately by telephone notice, immediately with the Commission a written request of any designated self- confirmed immediately in writing by copy of any notice it receives from the regulatory organization or registrant, or
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on its own motion, the Commission may § 1.17(b)(3)) or a noncustomer account (A) * * * grant an extension of time or an (as defined in § 1.17(b)(4)(ii)). (1) 120 percent of the appropriate exemption from any of the certified (8) ‘‘Risk margin’’ for an account minimum dollar amount required by financial reporting requirements of this means the level of maintenance margin paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of chapter either unconditionally or on or performance bond that the futures this section; specified terms and conditions. commission merchant is required to (2) For a futures commission * * * * * collect under the rules of an exchange, merchant or applicant therefor, 120 percent of the amount required by I 5. Section 1.17 is amended by: or the rules of a clearing organization if paragraph (a)(1)(i)(B) of this section; I a. revising paragraphs (a)(1)(i)(B) and the level of margin to be collected is not (b)(4), determined by the rules of an exchange, * * * * * I b. adding new paragraphs (b)(7) and from the owner of a customer account (B) * * * (b)(8), and or noncustomer account, subject to the (1) 200 percent of the appropriate I c. revising paragraphs (e)(1)(i), following: minimum dollar amount required by (e)(1)(ii), (h)(2)(vi)(C)(1) and (2), (i) Risk margin does not include the paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of (h)(2)(vii)(A)(1) and (2), (h)(2)(vii)(B)(1) equity component of short or long this section; and (2), (h)(2)(viii)(A)(1) and (2), option positions maintained in an (2) For a futures commission (h)(3)(ii)(A) and (B), (h)(3)(v)(A) and (B) account; merchant or applicant therefor, 125 and (h)(3)(vii), to read as follows: (ii) The maintenance margin or percent of the amount required by performance bond requirement paragraph (a)(1)(i)(B) of this section; § 1.17 Minimum financial requirements for associated with a long option position * * * * * futures commission merchants and may be excluded from risk margin to the (viii) * * * introducing brokers. extent that the value of such long option (A) * * * (a)(1)(i) * * * position does not reduce the total risk (1) 120 percent of the appropriate (B) The futures commission maintenance or performance bond minimum dollar amount required by merchant’s risk-based capital requirement of the account that holds paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of requirement computed as follows: the long option position; this section; (1) Eight percent of the total risk (iii) The risk margin for an account (2) For a futures commission margin requirement (as defined in carried by a futures commission merchant or applicant therefor, 120 § 1.17(b)(8)) for positions carried by the merchant which is not a member of the percent of the amount required by futures commission merchant in exchange or the clearing organization paragraph (a)(1)(i)(B) of this section; customer accounts (as defined in that requires collection of such margin * * * * * § 1.17(b)(7)), plus should be calculated as if the futures (h) * * * (2) Four percent of the total risk commission merchant were such a (3) * * * margin requirement (as defined in member; and (ii) * * * § 1.17(b)(8)) for positions carried by the (iv) If a futures commission merchant (A) 120 percent of the appropriate futures commission merchant in does not possess sufficient information minimum dollar amount required by noncustomer accounts (as defined in to determine what portion of an paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of § 1.17(b)(4)). account’s total margin requirement this section; * * * * * represents risk margin, all of the margin (B) For a futures commission (b) * * * required by the exchange or the clearing merchant or applicant therefor, 120 (4) ‘‘Noncustomer account’’ means a organization that requires collection of percent of the amount required by commodity futures or option account such margin for that account, shall be paragraph (a)(1)(i)(B) of this section; carried on the books of the applicant or treated as risk margin. * * * * * registrant which is either: * * * * * (v) * * * (i) An account that is not included in (e)(1) * * * (A) 120 percent of the appropriate the definition of customer (as defined in (i) 120 percent of the appropriate minimum dollar amount required by § 1.17(b)(2)) or proprietary account (as minimum dollar amount required by paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of defined in § 1.17(b)(3)), or paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of this section; (ii) An account for a foreign- this section; (B) For a futures commission domiciled person trading futures or (ii) For a futures commission merchant or applicant therefor, 120 options on a foreign board of trade, and merchant or applicant therefor, 120 percent of the amount required by such account is a proprietary account as percent of the amount required by paragraph (a)(1)(i)(B) of this section; defined in § 1.3(y) of this title, but is not paragraph (a)(1)(i)(B) of this section; * * * * * a proprietary account as defined in * * * * * (vii) Subordination agreements that § 1.17(b)(3). (h) * * * incorporate adjusted net capital * * * * * (2) * * * requirements in effect prior to (7) ‘‘Customer account’’ means a (vi) * * * September 30, 2004. Any subordination commodity futures or option account (C) * * * agreement that incorporates the adjusted carried on the books of the applicant or (1) 120 percent of the appropriate net capital requirements in paragraphs registrant which is either: minimum dollar amount required by (h)(2)(vi)(C)(2), (h)(2)(vii)(A)(2) and (i) An account that is included in the paragraphs (a)(1)(i)(A) or (a)(1)(iii)(A) of (B)(2), (h)(2)(viii)(A)(2), (h)(3)(ii)(B), and definition of customer (as defined in this section; (h)(3)(v)(B) of this section, as in effect § 1.17(b)(2)), or (2) For a futures commission prior to September 30, 2004, and which (ii) An account for a foreign- merchant or applicant therefor, 120 has been deemed to be satisfactorily domiciled person trading on a foreign percent of the amount required by subordinated pursuant to this section board of trade, where such account for paragraph (a)(1)(i)(B) of this section; prior to September 30, 2004, shall the foreign-domiciled person is not a * * * * * continue to be deemed a satisfactory proprietary account (as defined in (vii) * * * subordination agreement until the
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maturity of such agreement. In the ACTION: Final rule. members of a foreign board of trade or event, however, that such agreement is affiliates of U.S. FCMs must register amended or renewed for any reason, SUMMARY: The Commodity Futures under the Act or obtain an exemption then such agreement shall not be Trading Commission (Commission or from registration under the Act. deemed a satisfactory subordination CFTC) is amending part 30 of the The Commission’s part 30 rules agreement unless the amended or Commission’s regulations to clarify the govern, generally, the solicitation and renewed agreement meets the circumstances under which a foreign sale of foreign futures 3 and foreign requirements of this section. futures and options broker (FFOB) that option 4 contracts to customers 5 located is a member of a foreign board of trade * * * * * in the U.S. Rule 30.4(a) requires any must register or obtain an exemption person who solicits or accepts orders I 6. Section 1.18 is amended by revising from registration. The Commission has paragraph (b) to read as follows: and money for foreign futures or foreign amended Rule 30.4(a) to clarify that option contracts from foreign futures or § 1.18 Records for and relating to financial FFOBs are not required to register as foreign options customers 6 to register as reporting and monthly computation by futures commission merchants (FCMs) an FCM under the Act. Rule 30.10 futures commission merchants and pursuant to Rule 30.4, or to seek permits any person to seek exemption introducing brokers. exemption from registration under Rule from any provision of part 30. * * * * * 30.10, if they only carry the following Under Rule 30.10 and Appendix A (b)(1) Each applicant or registrant types of U.S.-related accounts that trade thereto, the CFTC may exempt an FFOB must make and keep as a record in on or are subject to the rules of non-U.S. from compliance with certain rules, accordance with § 1.31 formal exchanges: Customer omnibus accounts including those rules pertaining to computations of its adjusted net capital for U.S. FCMs; U.S. affiliate accounts registration, provided that a comparable and of its minimum financial that are proprietary to the FFOB; and/ regulatory system exists in the firm’s requirements pursuant to § 1.17 or the or U.S. accounts that are proprietary to home country and that certain requirements of the designated self- a U.S. FCM. In addition, an FFOB that safeguards are in place to protect U.S. regulatory organization to which it is has U.S. bank branches will be eligible investors. This exemption process subject as of the close of business each for a Rule 30.10 comparability requires that the CFTC issue an Order month. Such computations must be exemption or exemption from pursuant to Rule 30.10 granting general completed and made available for registration under Rule 30.4 based upon relief to the foreign regulator or self- inspection by any representative of the compliance with conditions specified in regulatory organization and that National Futures Association, in the Rule 30.10(b)(1)–(6) and thereby will be individual firms be granted case of an applicant, or of the able to carry any U.S.-related account confirmation of relief upon proper Commission or designated self- for trades on non-U.S. exchanges. The application. Generally, a firm that regulatory organization, if any, in the Commission has also deleted Rule confirms relief under Rule 30.10 must case of a registrant, within 17 business 30.4(e), which required an FCM be located outside the U.S. and this days after the date for which the registered under part 30 to maintain a relief permits a firm to solicit or accept computations are made, commencing U.S. office. orders from U.S.-located customers for the first month end after the date the EFFECTIVE DATE: September 13, 2004. trading on or subject to the rules of application for registration is filed. FOR FURTHER INFORMATION CONTACT: exchanges located outside of the U.S. (2) An applicant or registrant that has Lawrence B. Patent, Deputy Director, or II. Final Rules filed a monthly Form 1–FR or Statement Susan A. Elliott, Special Counsel, of Financial and Operational Combined Compliance and Registration Section, A. Registration Exemptions Uniform Single Report under the Division of Clearing and Intermediary As explained in the rule proposal, the Securities Exchange Act of 1934, Part II Oversight, Commodity Futures Trading Commission believes that it can provide or Part IIA (FOCUS report) in Commission. Three Lafayette Centre, clarity to its registration requirements accordance with the requirements of 1155 21st Street, NW., Washington, DC under part 30 by specifically addressing, § 1.10(b) will be deemed to have 20581. Telephone: (202) 418–5439 or in Rule 30.4, when registration by an satisfied the requirements of paragraph (202) 418–5464, or electronic mail: FFOB is not required. Thus, the (b)(1) of this section for such month. [email protected] or [email protected]. Commission has amended Rule 30.4(a) * * * * * SUPPLEMENTARY INFORMATION: 3 Issued in Washington, DC, on August 5, I. Background ‘‘Foreign futures’’ as defined in part 30 means 2004, by the Commission. ‘‘any contract for the purchase or sale of any The Commission has adopted final commodity for future delivery made, or to be made, Jean A. Webb, on or subject to the rules of any foreign board of Secretary of the Commission. rules that were first published for trade.’’ Commission Rule 30.1(a). 1 comment on August 26, 1999, and 4 [FR Doc. 04–18349 Filed 8–11–04; 8:45 am] ‘‘Foreign option’’ as defined in part 30 means republished on April 6, 2004.2 The ‘‘any transaction or agreement which is or is held BILLING CODE 6351–01–P Commission proposed amending part 30 out to be of the character of, or is commonly known of its rules to clarify when foreign to the trade as, an ‘‘option’’, ‘‘privilege’’, ‘‘indemnity’’, ‘‘bid’’, ‘‘offer’’, ‘‘put’’, ‘‘call’’, COMMODITY FUTURES TRADING futures and options brokers that are ‘‘advance guaranty’’, or ‘‘decline guaranty’’, made or COMMISSION to be made on or subject to the rules of any foreign 1 64 FR 46613 (August 26, 1999). board of trade.’’ Commission Rule 30.1(b). 5 17 CFR Part 30 2 69 FR 17998 (April 6, 2004). The reproposal was Pursuant to Commission Rule 30.1(c), ‘‘Foreign substantially the same, except that the 1999 futures or foreign options customer’’ means ‘‘any RIN 3038–AB45 proposal required an entity with a U.S. bank branch person located in the United States, its territories applying for a Rule 30.10 exemption to file a or possessions who trades in foreign futures or Foreign Futures and Foreign Options specified set of representations with the National foreign options: Provided, That an owner or holder Futures Association (NFA), while the 2004 of a proprietary account as defined in paragraph (y) Transactions reproposal listed the representations as conditions of [Commission Rule 1.3] shall not be deemed to for compliance with the exemption, in order to be a foreign futures or foreign options customer AGENCY: Commodity Futures Trading reduce the paperwork necessitated by the rule within the meaning of §§ 30.6 and 30.7 of this part.’’ Commission. amendments. 6 See n. 5, supra.
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to clarify that FFOBs are not required to (1) No U.S. bank branch, office or (6) Although it will continue to register as FCMs if they only carry the division will engage in the trading of engage in normal commercial activities, following types of U.S.-related accounts futures or options on futures within or no U.S. bank branch, office or division that trade on or subject to the rules of from the U.S., except for its own will establish relationships in the U.S. non-U.S. exchanges: (1) Foreign futures account; 9 with the broker’s foreign futures and and options customer omnibus (2) No U.S. bank branch, office or foreign options customers for the accounts 7 of U.S. FCMs; (2) its own division will refer any foreign futures or purpose of facilitating or effecting proprietary accounts (including foreign options customer to the FFOB or transactions in foreign futures and accounts of its U.S. affiliates and others otherwise be involved in the FFOB’s foreign option contracts in the U.S. whose accounts are ‘‘proprietary’’ to the business in foreign futures and foreign Pursuant to these rule amendments, FFOB under CFTC Rule 1.3(y)); and/or option transactions; an FFOB that is not required to register (3) proprietary accounts of a U.S. FCM. (3) No U.S. bank branch, office or under Rule 30.4(a) because it solely These FFOBs, however, otherwise division will solicit any foreign futures carries a U.S. customer omnibus remain subject to provisions of part 30 or foreign options business or purchase account, an account that would be that are not dependent upon registration or sell foreign futures or foreign option classified as proprietary to the broker as an FCM, such as the antifraud contracts on behalf of any foreign under Commission Rule 1.3(y), or a U.S. provision of Rule 30.9. The exemption futures or foreign option customers or FCM’s proprietary account, is also not from registration is self-executing and otherwise engage in any activity subject required to register solely because it has does not require entities seeking to avail to regulation under Part 30 or engage in U.S. bank branches, so long as it themselves of the exemption to file a any clerical duties related thereto. If any complies with the conditions specified petition under Rule 30.10. U.S. division, office or branch desires to in Rule 30.10(b)(1)–(6), as listed engage in such activities, it will only do above.11 An FFOB is eligible for Rule 30.10 The main difference in the two types relief notwithstanding the presence in so through an appropriate CFTC registrant; of exemptions referred to herein relate the U.S. of a separately-incorporated to whether the firm seeking exemption affiliate or subsidiary that engages in a (4) The FFOB will maintain outside the U.S. all contract documents, books is otherwise regulated and what type of related activity if the following accounts it may handle. The exemptions procedural requirements are met: (1) and records regarding foreign futures and option transactions; in Rule 30.4 apply to any foreign firm, The applicant must identify the name irrespective of whether it is a member and location of any affiliate or (5) The FFOB and each of its U.S. bank branches, offices or divisions agree of an exchange or other self-regulatory subsidiary in the U.S. which acts in a organization, or a regulatee of a foreign related capacity (e.g., bank, broker- to provide upon request of the Commission, the NFA or the U.S. regulatory authority, that has received a dealer or dealer in a cash commodity); Commission order under Rule 30.10. Department of Justice, access to their (2) the applicant must represent that it However, such an entity may only books and records for the purpose of will not accept any futures-related handle those U.S.-related accounts ensuring compliance with the business from any of its affiliates or described above, customer omnibus or undertakings and consent to make such subsidiaries in the U.S. other than a proprietary to itself or to a U.S. FCM. By records available for inspection at a proprietary account of the affiliate or contrast, the firm seeking confirmation location in the U.S. within 72 hours subsidiary, unless such entities are of relief under Rule 30.10 must be after service of the request; 10 and registered with the CFTC in the otherwise regulated by an entity that has appropriate capacity; and (3) the received a Commission order under 9 That is, the ‘‘house’’ account of the entity. This applicant must represent that it has is the ‘‘narrow’’ definition of the term Rule 30.10, which relief permits the informed its affiliates or subsidiaries in ‘‘proprietary,’’ as set forth in Commission Rule firm to handle any U.S.-related writing that they may not introduce to, 1.17(b)(3). accounts. In either case, if the firm in or solicit futures business on behalf of, 10 The Commission has recognized that Japanese question has bank branches, the the applicant, unless such entities are and Hong Kong laws require that original books and records of any firm located within either country be conditions set forth in Rule 30.10(b)(1)– registered with the CFTC in the maintained within the local jurisdiction. See CFTC (6) must be met. appropriate capacity. Staff Letter 95–83 [1994–1996 Transfer Binder] The Commission’s adoption of these As explained in the rule proposal, in Comm. Fut. L. Rep. (CCH) ¶ 26,559 at 43,490 rule amendments supercedes prior staff (September 20, 1995) (no-action position permitting positions on these subjects.12 Because certain cases CFTC staff has permitted the Japanese and Hong Kong affiliates of a U.S. FCM an FFOB with U.S. bank branches to to accept directly foreign futures and options orders obtain a Rule 30.10 exemption under from certain sophisticated U.S. customers); 62 FR Japanese or Hong Kong FFOB are also subject to 47792 (September 11, 1997) (extending the relief request by NFA and U.S. Department of Justice certain conditions on the grounds that a under CFTC Staff Letter 95–83 to the Japanese and representatives, as is the case for an FFOB in any bank branch is viewed as a separate Hong Kong affiliates of all U.S. FCMs). That letter other jurisdiction. legal entity in many respects under the is now superceded by this rule. For the purpose of 11 The rationale for providing relief to foreign U.S. federal bank regulatory scheme. this rulemaking, the Commission will allow foreign firms with bank branches in the U.S. is that those futures and options brokers in Japan and Hong branches are otherwise regulated by the banking This rule codifies those staff positions Kong to satisfy the books and records requirement authorities. Although this rationale would be as set forth in interpretative statements by: (1) Providing within 72 hours authenticated inapplicable to non-bank branches, there may be and no-action letters.8 The Commission copies of its books and records upon request of a other reasons why exemption from registration is amending Rule 30.10 to clarify that an Commission, NFA or U.S. Department of Justice under part 30 would be appropriately granted upon representative; (2) providing within 72 hours access application by Commission staff. FFOB with U.S. bank branches may be to original books and records in the foreign 12 See CFTC Staff Letter 87–7 (customer omnibus eligible for confirmation of Rule 30.10 jurisdiction; (3) waiving objection to the accounts), [1987–1990 Transfer Binder] Comm. Fut. relief if it complies with the following admissibility of the copies as evidence in a L. Rep. (CCH) ¶ 23,972 (November 17, 1987); CFTC conditions: Commission, NFA or U.S. Department of Justice Staff Letter 88–15 (proprietary accounts), [1987– action against the foreign futures and options 1990 Transfer Binder] Comm. Fut. L. Rep. (CCH) broker; and (4) agreeing in the event of a proceeding ¶ 24,296 (August 10, 1988); CFTC Staff Letter 89– 7 ‘‘Foreign futures and options customer omnibus to provide a witness to authenticate copies of books 5 (bank branches), [1987–1990 Transfer Binder] account’’ is defined at Rule 30.1(d), 17 CFR 30.1(d) and records given to the Commission, NFA, or the Comm. Fut. L. Rep. (CCH) ¶ 24,471 (December 8, (2003). U.S. Department of Justice. The Commission is 1988); and CFTC Staff Letter 89–11 (bank branches), 8 See n. 12, infra. clarifying that the books and records from a Continued
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the rule amendments contain no NFA implemented this interpretation discussed above, foreign firms seeking substantive changes to prior staff and it is currently set forth in Rule 802. to solicit or accept orders and funds interpretative statements and no-action Paragraph (a)(9)(i) of that rule requires related thereto from U.S.-located letters, no party should be production of records in the U.S. on 72 customers for transactions on non-U.S. disadvantaged. The new rules will make hours’ notice, except that FCMs must exchanges do not apply for registration these staff positions more accessible and produce on 24 hours’ notice except for as FCMs under Rule 30.4, but instead more widely understood and obviate the good cause shown. A foreign applicant submit the appropriate certification to need for individualized relief. also certifies, per paragraph (a)(9)(iv), confirm exemption relief granted by Two comments were submitted in that it is not subject to any blocking, Commission order under Rule 30.10 to response to the Commission’s privacy or secrecy laws that would the firms’ foreign regulator or self- reproposal. Both were generally interfere with or create an obstacle to regulatory organization. In addition, supportive of the rule amendments. One full inspection of the applicant’s books Rule 30.4(e) may be eliminated because comment suggested clarification of the and records by the CFTC, the its purposes are now accomplished by applicability of amended Rule 30.4(a), Department of Justice, and NFA. NFA’s Rule 802, as discussed above. because the preamble to the reproposal Although the coverage of Rule 30.4(e) limited its applicability to FFOBs with was limited strictly to those persons B. Regulatory Flexibility Act foreign futures and foreign options required to register as FCMs under Rule The Regulatory Flexibility Act customer omnibus accounts of U.S. 30.4 (and therefore engaged in (‘‘RFA’’), 5 U.S.C. 601–611, requires that FCMs ‘‘but [that] have no direct contact transactions on or subject to the rules of agencies, in proposing rules, consider with the customers whose accounts foreign boards of trade), the provision the impact of those rules on small comprise the omnibus accounts.’’ 13 The has no counterpart with respect to businesses. The Commission has commenter was concerned that the trades done on designated contract previously established certain quoted phrase could be read as markets by foreign firms, and does not definitions of ‘‘small entities’’ to be used contradicting Commission Rule 30.12, include foreign-based commodity by the Commission in evaluating the which permits certain foreign firms to trading advisors (CTAs), commodity impact of its rules on such entities in accept and to execute orders directly pool operators (CPOs) and introducing accordance with the RFA.16 In from U.S. customers without having to brokers (IBs). proposing these amendments to part 30, register with the Commission. In In light of these factors, the the Commission stated that they would response to this comment, the Commission is revoking Rule 30.4(e). affect foreign members of foreign boards Commission emphasizes that the The Commission notes that foreign of trade who perform the functions of an amended Rule 30.4(a) in no way limits firms seeking to solicit or accept orders FCM, some of which may be foreign the scope of Rule 30.12. and funds related thereto from U.S.- affiliates of U.S. FCMs. The Commission located customers for transactions on B. U.S. Office previously has determined that, based non-U.S. exchanges do not apply for upon the fiduciary nature of the FCM/ Finally, the Commission is deleting registration as FCMs under Rule 30.4, customer relationships, as well as the Rule 30.4(e) to eliminate an but instead submit the appropriate requirement that FCMs meet minimum inconsistency and source of potential certification to confirm exemption relief financial requirements, FCMs should be confusion. Rule 30.4(e) stated that granted by Commission order under excluded from the definition of small ‘‘persons required to be registered as [an Rule 30.10 to the firms’ foreign regulator entities. No comment was received FCM] must maintain an office in the or self-regulatory organization. The regarding the impact of these United States which is managed by an Commission also notes that, as of amendments on small businesses. individual domiciled in the United September 30, 2004, there were more States and registered with the than 470 foreign-based IBs, CPOs and C. Paperwork Reduction Act Commission as an associated person.’’ CTAs and the Commission has not As required by the Paperwork Rule 30.4(e) was originally adopted observed any special concerns as a Reduction Act of 1995,17 the because of a concern that unscrupulous result. Commission submitted a copy of the firms might establish their base of proposed rule amendments to the Office III. Related Matters operations offshore.14 of Management and Budget for its A few months after Rule 30.4(e) was A. Administrative Procedure Act review. The Commission did not receive adopted as a provision of the original The Administrative Procedure Act any public comments relative to its Part 30 rules, a staff interpretation generally requires that, before an agency analysis of paperwork burdens clarified that a policy basis for the adopts a rule, the agency provide an associated with this rulemaking. provision was the assurance that a opportunity for notice and comment D. Cost-Benefit Analysis foreign FCM can produce its books and thereon. That opportunity is not Section 15(a) of the Act requires the records—but that if it can otherwise required, however, when the agency for Commission to consider the costs and demonstrate that capability and its good cause finds such procedure 15 benefits of its action before issuing a willingness to do so, that is sufficient. unnecessary. The Commission is new regulation under the Act. By its eliminating Rule 30.4(e) without [1987–1990 Transfer Binder] Comm. Fut. L. Rep. terms, section 15(a) does not require the provision for notice and comment (CCH) ¶ 24,516 (August 15, 1989). Commission to quantify the costs and 13 because such procedure is unnecessary, 69 FR 17988 at 17999 (April 6, 2004). benefits of a new regulation or to 14 52 FR 28980 at 28990 (August 5, 1987). per section 553(b)(3)(B) of the determine whether the benefits of the 15 The letter, directed to NFA, stated that it would Administrative Procedure Act, 5 U.S.C. proposed regulation outweigh its costs. be ‘‘other good cause’’ to deny registration to a 553(b)(3)(B) (2004). Rule 30.4(e) has foreign-located firm ‘‘unless the applicant has an Rather, section 15(a) simply requires the never been applied because, as office in the United States, its territories or Commission to ‘‘consider the costs and possessions, or the applicant is otherwise able to benefits’’ of its action. Section 15(a) demonstrate that it has adopted appropriate comply with such procedures.’’ Staff Letter 87–10, procedures for producing its books and records in [1987–1990 Transfer Binder] Comm. Fut. L. Rep. the United States expeditiously upon request, and (CCH) ¶ 23,999 (Dec. 9, 1987). (Emphasis in 16 47 FR 18618–18621 (April 30, 1982). the applicant can and does represent that it will original.) 17 Pub. L. 104–13 (May 13, 1995).
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further specifies that costs and benefits merchant and such registration shall not otherwise engage in any activity subject shall be evaluated in light of five broad have expired nor been suspended nor to regulation under this part or engage areas of market and public concern: revoked; provided that, a foreign futures in any clerical duties related thereto. If Protection of market participants and and options broker (as defined in any U.S. division, office or branch the public; efficiency, competitiveness, § 30.1(e)) is not required to register as a desires to engage in such activities, it and financial integrity of futures futures commission merchant: one, in will only do so through an appropriate markets; price discovery; sound risk order to accept orders from or to carry Commission registrant; management practices; and other public a U.S. futures commission merchant’s (4) The foreign person will maintain interest considerations. Accordingly, the foreign futures and options customer outside the United States all contract Commission could in its discretion give omnibus account, as that term is defined documents, books and records regarding greater weight to any one of the five in § 30.1(d); two, in order to accept foreign futures and foreign option enumerated areas and could in its orders from or to carry a U.S. futures transactions; discretion determine that, commission merchant’s proprietary (5) The foreign person and each of its notwithstanding its costs, a particular account, as that term is defined in U.S. bank branches, offices or divisions rule was necessary or appropriate to paragraph (y) of § 1.3 of this chapter; agree to provide upon request of the protect the public interest or to and/or three, in order to accept orders Commission, the National Futures effectuate any of the provisions or to from or carry a U.S. affiliate account Association or the U.S. Department of accomplish any of the purposes of the which is proprietary to the foreign Justice, access to their books and Act. futures and options broker, as records for the purpose of ensuring The Commission published an ‘‘proprietary account’’ is defined in compliance with the foregoing analysis of costs and benefits when it paragraph (y) of § 1.3 of this chapter. undertakings and consent to make such proposed the rule amendments that Such foreign futures and options broker records available for inspection at a have now been adopted.18 It did not remains subject to all other applicable location in the United States within 72 receive any public comments pertaining provisions of the Act and of the rules, hours after service of the request; and to the analysis. regulations and orders thereunder. (6) Although it will continue to Foreign futures and options brokers that engage in normal commercial activities, List of Subjects in 17 CFR Part 30 have U.S. bank branches, offices or no U.S. bank branch, office or division Definitions, Foreign futures, Foreign divisions engaging in the activity listed of the foreign person will establish options, Reporting and recordkeeping in this paragraph are not required to relationships in the United States with requirements, Registration register as futures commission the applicant’s foreign futures or foreign requirements. merchants if they comply with the option customers for the purpose of I In consideration of the foregoing, and conditions listed in § 30.10(b)(1) facilitating or effecting transactions in pursuant to the authority contained in through (6). foreign futures or foreign option the Commodity Exchange Act and, in * * * * * contracts. particular, sections 2(a)(1), 4(b), 4c and I 3. Section 30.10 is amended by Dated: August 4, 2004. 8 thereof, 7 U.S.C. 2, 6(b), 6c and 12a, designating the existing text as paragraph By the Commission. and pursuant to the authority contained (a) and adding paragraph (b) to read as Jean A. Webb, in 5 U.S.C. 552 and 552b, the follows: Secretary of the Commission. Commission hereby amends Chapter I of Title 17 of the Code of Federal § 30.10 Petitions for exemption. [FR Doc. 04–18344 Filed 8–11–04; 8:45 am] Regulations as follows: * * * * * BILLING CODE 6351–01–P (b) Any foreign person that files a PART 30—FOREIGN OPTIONS AND petition for an exemption under this FOREIGN FUTURES TRANSACTIONS section shall be eligible for such an SECURITIES AND EXCHANGE exemption notwithstanding its presence COMMISSION I 1. The authority citation for part 30 in the United States through U.S. bank continues to read as follows: branches or divisions if, in conjunction 17 CFR Part 232 Authority: 7 U.S.C. 1a, 2, 4, 6, 6c and 12a, with a petition for confirmation of relief [Release Nos. 33–8454; 34–50160; 35– unless otherwise noted. granted under an existing Commission 27881; 39–2424; IC–26525] I order issued pursuant to this section, it 2. Section 30.4 is amended by revising RIN 3235–AG96 paragraph (a) to read as follows, and by complies with the following conditions: removing paragraph (e): (1) No U.S. bank branch, office or Adoption of Updated EDGAR Filer division will engage in the trading of Manual § 30.4 Registration required. futures or options on futures within or * * * * * from the United States, except for its AGENCY: Securities and Exchange (a) To solicit or accept orders for or own proprietary account; Commission. involving any foreign futures contract or (2) No U.S. bank branch, office or ACTION: Final rule. foreign options transaction and, in division will refer any foreign futures or connection therewith, to accept any foreign options customer to the foreign SUMMARY: The Securities and Exchange money, securities or property (or extend person or otherwise be involved in the Commission (the Commission) is credit in lieu thereof) to margin, foreign person’s business in foreign adopting revisions to the Electronic Data guarantee or secure any trades or futures or foreign option transactions; Gathering, Analysis, and Retrieval contracts that result or may result (3) No U.S. bank branch, office or System (EDGAR) Filer Manual to reflect therefrom, unless such person shall division will solicit any foreign futures updates to the EDGAR system. The have registered, under the Act, with the or foreign option business or purchase revisions are being made primarily to Commission as a futures commission or sell foreign futures or foreign option support the redesign of Form 8–K, contracts on behalf of any foreign where the reportable events have been 18 69 FR 17988 at 18000 (April 6, 2004). futures or foreign option customers or expanded from 12 to 22 items, a new
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hierarchical numbering scheme has requirements for filing using descriptions have changed for Exhibits been introduced for the reportable modernized EDGARLink.2 7 and 17 and Exhibits 6 and 28 have events (items), and the fact that the 8– The Filer Manual contains all the been removed as valid exhibits. K can be filed to simultaneously satisfy technical specifications for filers to We are discontinuing support for some filing obligations for Rules 425, submit filings using the EDGAR system. submission types 40–8F–A, 40–8F–B, 14a–12, 14d–2(b) and 13e–4(c). Filers must comply with the applicable 40–8F–L, and 40–8F–M and their Revisions are also being made to provisions of the Filer Manual in order amendments. In their place, filers will provide support for EDGARLink on to assure the timely acceptance and use new submission types N–8F and N– Windows XP, in addition to existing processing of filings made in electronic 8F/A to submit their Forms N–8F and support for Windows 98, 2000 and format.3 Filers should consult the Filer amendments. Those filers needing to NT; to provide support for modified Manual in conjunction with our rules file amendments to filings previously exhibit descriptions for Regulations S– governing mandated electronic filing submitted on submission types 40–8F– K and S–B; for discontinued support for when preparing documents for A, 40–8F–B, 40–8F–L, or 40–8F–M may submission Form types 40–8F–A, 40– electronic submission.4 do so using new submission type N–8F/ 8F–B, 40–8F–L, 40–8F–M and their We will implement EDGAR Release A. amendments; to provide support for the 8.8 on August 23, 2004, to support the Earlier this year, we proposed 6 to electronic filing of submission Form redesign of Form 8–K,5 where the amend to Rule 101 of Regulation S–T 7 types 40–17G, 40–17GCS, 40–24B2, 40– reportable events have been expanded to make mandatory the electronic 33 and their amendments; and, the from 12 to 22 items, a new hierarchical submission by investment companies of ability to enter multiple classes numbering scheme has been introduced fidelity bonds under Section 17(g),8 (contracts) for a series at one time from for the reportable events (items), and the sales literature filed with us under a single web page. fact that the 8–K can be filed to Section 24(b),9 and litigation material The revisions to the Filer Manual simultaneously satisfy some filing filed under Section 33 of the Investment 10 reflect changes within Volumes I, II and obligations for Rules 425, 14a–12, 14d– Company Act. While we have not yet III, entitled ‘‘EDGAR Release 8.8 2(b) and 13e–4(c). Revisions are also adopted our proposed amendment to being made to provide support for Rule 101, we are adding electronic filing EDGARLink Filer Manual,’’ ‘‘EDGAR Release 8.8 N–SAR Supplement Filer EDGARLink on Windows XP, in of submission types 40–17G, 40–17GCS, addition to existing support for 40–24B2, and 40–33 and their Manual,’’ and ‘‘EDGAR Release 8.8 OnlineForms Filer Manual’’ Windows 98, 2000 and NT; to no amendments so that filers may begin longer support EDGARLink under making these filings electronically on a respectively. The updated manual will be incorporated by reference into the Windows 95; to provide support for voluntary basis. At this time, we will Code of Federal Regulations. modified exhibit descriptions for continue to accept paper submissions of Regulations S–K and S–B, where both these filings. EFFECTIVE DATE: August 23, 2004. The Regulations S–K and S–B descriptions This year we also proposed that incorporation by reference of the are shown for each exhibit number, the certain open-end management EDGAR Filer Manual is approved by the investment companies and insurance Director of the Federal Register as of 2 This is the filer assistance software we provide company separate accounts identify in August 23, 2004. filers filing on the EDGAR system. their EDGAR submissions information 3 FOR FURTHER INFORMATION CONTACT: In See Rule 301 of Regulation S–T (17 CFR relating to their series and classes (or 232.301). the Office of Information Technology, 4 See Release Nos. 33–6977 (February 23, 1993) contracts, in the case of separate 11 Rick Heroux, at (202) 942–8800; for [58 FR 14628], IC–19284 (February 23, 1993) [58 FR accounts). The new series and class questions concerning the Division of 14848], 35–25746 (February 23, 1993) [58 FR page is now operational on the EDGAR Investment Management filings, in the 14999], and 33–6980 (February 23, 1993) [58 FR Filing Web site https:// 15009] in which we comprehensively discuss the Division of Investment Management, rules we adopted to govern mandated electronic www.edgarfiling.sec.gov/. Since the Ruth Armfield Sanders, Senior Special filing. See also Release No. 33–7122 (December 19, series and class page is live, filers who Counsel, at (202) 942–0978; for 1994) [59 FR 67752], in which we made the EDGAR filed their latest registration statements questions concerning the Division of rules final and applicable to all domestic or amendments on Form N–1A, N–3, N– registrants; Release No. 33–7427 (July 1, 1997) [62 Corporation Finance filings, in the FR 36450], in which we adopted minor 4, or N–6 may use the page to enter Division of Corporation Finance, amendments to the EDGAR rules; Release No. 33– information for their series and classes Herbert Scholl, Office Chief, EDGAR 7472 (October 24, 1997) [62 FR 58647], in which (contracts); filers who do so will be and Information Analysis, at (202) 942– we announced that, as of January 1, 1998, we would issued series and classes (contracts) not accept in paper filings that we require filers to 2940; and, in the Office of Filings and submit electronically; Release No. 34–40934 identifiers. However, using the page and Information Services, Margaret A. Favor, (January 12, 1999) [64 FR 2843], in which we made obtaining identifiers is not mandatory at (202) 942–8900. mandatory the electronic filing of Form 13F; this time. Obtaining identifiers will not Release No. 33–7684 (May 17, 1999) [64 FR 27888], SUPPLEMENTARY INFORMATION: Today we become mandatory unless and until we in which we adopted amendments to implement act through a formal rulemaking to are adopting an updated EDGAR Filer the first stage of EDGAR modernization; Release No. Manual (Filer Manual). The Filer 33–7855 (April 24, 2000) [65 FR 24788], in which adopt the series and class requirements we implemented EDGAR Release 7.0; Release No. that we proposed.12 In this release, we Manual describes the technical 33–7999 (August 7, 2001) [66 FR 42941], in which formatting requirements for the we implemented EDGAR Release 7.5; Release No. 6 See ‘‘Rulemaking for EDGAR System,’’ Release preparation and submission of 33–8007 (September 24, 2001) [66 FR 49829], in 33–8401 (March 16, 2004) [69 FR 13690 (March 23, electronic filings through the EDGAR which we implemented EDGAR Release 8.0; 2004)]. Release No. 33–8224 (April 30, 2003) [66 FR 24345], 1 7 17 CFR 232.101. system. It also describes the in which we implemented EDGAR Release 8.5; 8 Release Nos. 33–8255 (July 22, 2003) [68 FR 44876] 15 U.S.C. 80a–17(g). 9 1 We originally adopted the Filer Manual on April and 33–8255A (September 4, 2003) [68 FR 53289] 15 U.S.C. 80a–24(b). 1, 1993, with an effective date of April 26, 1993. in which we implemented EDGAR Release 8.6; and 10 15 U.S.C. 80a–31. Release No. 33–6986 (April 1, 1993) [58 FR 18638]. Release No. 33–8409 (April 19, 2004) [69 FR 21954] 11 See Release 33–8401. We implemented the most recent update to the Filer in which we implemented EDGAR Release 8.7. 12 See Release 33–8401 and Appendix J to the Manual on April 26, 2004. See Release No. 33–8409 5 See Release Nos. 33–8400 (March 16, 2004) [69 EDGAR Filer Manual for further information. Please (April 19, 2004) [69 FR 21954]. FR 15594] and 33–8400A (August 4, 2004). note that, before a registrant may use the series and
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are revising the series and class page to Procedure Act (APA).13 It follows that electronic submissions. The make it more user friendly. We have the requirements of the Regulatory requirements for filers using added the ability for investment Flexibility Act 14 do not apply. modernized EDGARLink are set forth in companies to enter multiple classes The effective date for the updated the EDGAR Release 8.8 EDGARLink (contracts) for a series at one time from Filer Manual and the rule amendments Filer Manual Volume I, dated August a single web page. is August 23, 2004. In accordance with 2004. Additional provisions applicable For EDGAR Release 8.8, the the APA,15 we find that there is good to Form N–SAR filers and Online Forms EDGARLink software and submission cause to establish an effective date less filers are set forth in the EDGAR Release templates 1, 2, 3 and 5 will be updated than 30 days after publication of these 8.8 N–SAR Supplement Filer Manual to support Windows XP, in addition to rules. The EDGAR system upgrade to Volume II, dated August 2004, and the Windows NT, 2000, and Windows Release 8.8 is scheduled to become EDGAR Release 8.8 OnlineForms Filer 98, and the aforementioned submission available on August 23, 2004. The Manual Volume III, dated August 2004. form type changes. It is highly Commission believes that it is necessary All of these provisions have been recommended that filers download, to coordinate the effectiveness of the incorporated by reference into the Code install, and use the new EDGARLink updated Filer Manual with the of Federal Regulations, which action software and submission templates to scheduled system upgrade. was approved by the Director of the Federal Register in accordance with 5 ensure that submissions will be Statutory Basis processed successfully; filers who wish U.S.C. 552(a) and 1 CFR part 51. You to use EDGARLink on Windows XP We are adopting the amendments to must comply with these requirements in must download the new version and Regulation S–T under Sections 6, 7, 8, order for documents to be timely new templates. Previous versions of the 10, and 19(a) of the Securities Act of received and accepted. You can obtain templates may not work properly. 1933,16 Sections 3, 12, 13, 14, 15, 23, paper copies of the EDGAR Filer EDGARLink will no longer be supported and 35A of the Securities Exchange Act Manual from the following address: on Windows 95. Notice of the update of 1934,17 Section 20 of the Public Public Reference Room, U.S. Securities has previously been provided on the Utility Holding Company Act of 1935,18 and Exchange Commission, 450 Fifth EDGAR Filing Web site and on the Section 319 of the Trust Indenture Act Street, NW., Washington, DC 20549– Commission’s public Web site. The of 1939,19 and Sections 8, 30, 31, and 38 0102 or by calling Thomson Financial discrete updates are reflected on the of the Investment Company Act of Inc at (800) 638–8241. Electronic format EDGAR Filing Web site and in the 1940.20 copies are available on the updated Filer Manual Volumes. List of Subjects in 17 CFR Part 232 Commission’s Web site. The address for Along with adoption of the Filer the Filer Manual is http://www.sec.gov/ Incorporation by reference, Reporting Manual, we are amending Rule 301 of info/edgar.shtml. You can also and recordkeeping requirements, Regulation S–T to provide for the photocopy the document at the National Securities. incorporation by reference into the Code Archives and Records Administration of Federal Regulations of today’s Text of the Amendment (NARA). For information on the availability of this material at NARA, revisions. This incorporation by I reference was approved by the Director In accordance with the foregoing, Title call 202–741–6030, or go to: http:// _ of the Federal Register in accordance 17, Chapter II of the Code of Federal www.archives.gov/federal register/ _ _ _ with 5 U.S.C. 552(a) and 1 CFR Part 51. Regulations is amended as follows: code of federal regulations/ ibr_locations.html. You may obtain paper copies of the PART 232—REGULATION S–T— updated Filer Manual at the following GENERAL RULES AND REGULATIONS Dated: August 6, 2004. address: Public Reference Room, U.S. FOR ELECTRONIC FILINGS By the Commission. Securities and Exchange Commission, Margaret H. McFarland, I 450 Fifth Street, NW., Washington DC 1. The authority citation for Part 232 Deputy Secretary. continues to read in part as follows: 20549–0102. We will post electronic [FR Doc. 04–18413 Filed 8–11–04; 8:45 am] format copies on the Commission’s Web Authority: 15 U.S.C. 77f, 77g, 77h, 77j, BILLING CODE 8010–01–P site; the address for the Filer Manual is 77s(a), 77sss(a), 78c(b), 78l, 78m, 78n, 78o(d), http://www.sec.gov/info/edgar.shtml. 78w(a), 78ll(d), 79t(a), 80a–8, 80a–29, 80a–30 You may also obtain copies from and 80a–37. SECURITIES AND EXCHANGE Thomson Financial Inc., the paper and * * * * * COMMISSION microfiche contractor for the I 2. Section 232.301 is revised to read as Commission, at (800) 638–8241. follows: 17 CFR Parts 239 and 274 Since the Filer Manual relates solely § 232.301 EDGAR Filer Manual. [Release Nos. 33–8393A; 34–49333A; IC– to agency procedures or practice, 26372A; File No. S7–51–02] publication for notice and comment is Filers must prepare electronic filings not required under the Administrative in the manner prescribed by the EDGAR RIN 3235–AG64 Filer Manual, promulgated by the Commission, which sets out the Shareholder Reports and Quarterly class page, it must make sure it has only one CIK. Portfolio Disclosure of Registered Those 1940 Act registrants for whom we proposed technical formatting requirements for to require identifiers for their series and classes (or Management Investment Companies; contracts, in the case of separate accounts) (i.e., 13 5 U.S.C. 553(b). Technical Amendment Form N–1A, N–3, N–4 and N–6 registrants) must 14 5 U.S.C. 601–612. AGENCY: Securities and Exchange submit their 1940 Act filings under only one 1940 15 5 U.S.C. 553(d)(3). Act number (811-) and one CIK. (Registrants may 16 15 U.S.C. 77f, 77g, 77h, 77j, and 77s(a). Commission. have multiple 1933 Act numbers under a single 17 ACTION: Final rule; Technical CIK.) Any 1940 Act registrant wishing to obtain 15 U.S.C. 78c, 78l, 78m, 78n, 78o, 78w, and identifiers who has more than one 1940 Act number 78ll. amendment to a form. or more than one CIK must call the IM EDGAR 18 15 U.S.C. 79t. Inquiry Line at 202–942–0978 for assistance before 19 15 U.S.C. 77sss. SUMMARY: The Securities and Exchange proceeding on the series and class page. 20 15 U.S.C. 80a–8, 80a–29, 80a–30, and 80a–37. Commission is adopting a technical
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amendment to Item 21(d)(1) of Form N– expense figures. Such figures would not Commission finds that publishing the 1A, which was published in the Federal facilitate investors’ ability to estimate changes for comment is unnecessary.6 Register on Tuesday, March 9, 2004 (69 their own expenses and to compare the The APA also generally requires that FR 11244). The amendment corrects an costs of different funds. This will tend an agency publish an adopted rule in instruction to the requirement for a to affect funds with relatively low the Federal Register 30 days before it registered open-end management expense ratios disproportionately. For becomes effective.7 However, an agency investment company to include in its example, an investor in a fund with an shareholder reports disclosure of fund may forgo the 30-day requirement if it annual expense ratio of 0.10% would 8 expenses borne by shareholders during pay $0.51 in expenses for a $1,000 finds good cause for doing so. For the the reporting period. initial investment over a half-year same reasons that the notice and EFFECTIVE DATE: August 12, 2004. period (assuming a 5% annual return for comment period is not required, the Commission finds good cause for the FOR FURTHER INFORMATION CONTACT: John the period). An investor in a fund with Faust, Attorney, Office of Disclosure an annual expense ratio of 0.29% would amendment to take effect immediately. Regulation, Division of Investment pay $1.47 in expenses for a $1,000 The Adopting Release required all fund Management, (202) 942–0721, at the investment over a half-year period reports to shareholders for periods Securities and Exchange Commission, (assuming a 5% annual return for the ending on or after July 9, 2004, to 450 Fifth Street NW., Washington, DC period). However, under the comply with the amendments in that 20549–0506. requirements we adopted, these two release, including the requirement for 9 SUPPLEMENTARY INFORMATION: funds would both show rounded expense examples. Therefore, any such expenses of $1.00, even though the shareholder report transmitted on or I. Background expense ratio for the second fund is after the date of this release must also The Securities and Exchange almost three times as large as that of the comply with this amendment. Commission (‘‘Commission’’) recently first fund. In addition, an investor who issued a release adopting amendments used this $1.00 expense figure to III. Statutory Authority to Form N–1A that require registered estimate his or her own expenses for an The Commission is adopting open-end management investment investment in either of the two funds amendments to Form N–1A pursuant to companies to disclose in their reports to would significantly underestimate or authority set forth in sections 5, 6, 7, 10, shareholders fund expenses borne by overestimate expenses. For example, an 19(a), and 28 of the Securities Act of shareholders during the reporting investor with a $25,000 initial 1933 [15 U.S.C. 77e, 77f, 77g, 77j, 77s(a), period (‘‘Adopting Release’’).1 The investment in each of the two funds amendments require shareholder reports would calculate his or her expenses to and 77z–3]; sections 10(b), 13, 15(d), to include: (1) The cost in dollars be $25.00 ($25,000/$1,000 × $1.00) for and 23(a) of the Securities Exchange Act associated with an investment of $1,000, each fund, while a calculation based on of 1934 [15 U.S.C. 78j(b), 78m, 78o(d), based on the fund’s actual expenses and expense figures rounded to the nearest and 78w(a)]; and sections 6(c), 8, 24(a), return for the period; and (2) the cost in cent would result in estimates of $12.75 30, and 38 of the Investment Company dollars associated with an investment of ($25,000/$1,000 × $0.51) and $36.75 Act of 1940 [15 U.S.C. 80a–6(c), 80a–8, $1,000, based on the fund’s actual ($25,000/$1,000 × $1.47), respectively. 80a–24(a), 80a–29, and 80a–37]. expenses for the period and an assumed The Commission is adopting a List of Subjects return of 5 percent per year. The technical amendment to Instruction 1(a) requirements for the expense examples of Item 21(d)(1) of Form N–1A to require 17 CFR Part 239 include an instruction to round all funds to round all figures in the table of dollar figures to the nearest dollar.2 expense examples to the nearest cent. In Reporting and recordkeeping The purpose of the expense examples light of the change to the initial requirements, Securities. is to increase investors’ understanding investment amount, we have concluded 17 CFR Part 274 of the fees that they pay on an ongoing that it is appropriate to require rounding basis for investing in a fund, and to to the nearest cent, rather than the Investment companies, Reporting and facilitate comparison of ongoing nearest dollar. recordkeeping requirements, Securities. expenses among funds.3 In adopting the requirement for the expense examples, II. Certain Findings Text of Form Amendment we required the examples to be based on Under the Administrative Procedure I For the reasons set out in the preamble, an initial investment of $1,000, rather Act (‘‘APA’’), notice of proposed Title 17, Chapter II of the Code of Federal than $10,000 as proposed, but did not rulemaking is not required when the reconsider the rounding instruction.4 agency, for good cause, finds ‘‘that Regulations is amended as follows: Subsequent to the adoption of the rule, notice and public procedure thereon are we have become aware that, in some impracticable, unnecessary, or contrary 6 For similar reasons, the amendments do not cases, rounding expenses paid on a 5 require analysis under the Regulatory Flexibility to the public interest.’’ The Act or analysis of major status under the Small $1,000 investment to the nearest dollar Commission is making a technical Business Regulatory Enforcement Fairness Act. See may result in insufficiently precise amendment to Form N–1A to effect the 5 U.S.C. 601(2) (for purposes of Regulatory intent of the Commission as expressed Flexibility Act analyses, the term ‘‘rule’’ means any 1 Investment Company Act Release No. 26372 in both the proposing and adopting rule for which the agency publishes a general notice (Feb. 27, 2004) [69 FR 11244 (Mar. 9, 2004] of proposed rulemaking); 5 U.S.C. 804(3)(C) (for (‘‘Adopting Release’’). releases. This amendment will make a purposes of congressional review of agency Form N–1A is the registration form used by open- minor change in the presentation of the rulemaking, the term ‘‘rule’’ does not include any end management investment companies to register expense example in shareholder reports, rule of agency organization, procedure, or practice under the Investment Company Act of 1940 and to which will have no effect on the burden that does not substantially affect the rights or offer their shares under the Securities Act of 1933. on funds of performing the calculation obligations of non-agency parties). 2 Instruction 1(a) to Item 21(d)(1) of Form N–1A. 7 5 U.S.C. 553(d). 3 Adopting Release, supra note 1, 69 FR at 11246. required. For the foregoing reasons, the 8 Id. 4 See Adopting Release, supra note 1, 69 FR at 9 See Adopting Release, supra note 1, 69 FR at 11247. 5 5 U.S.C. 553(b). 11254.
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PART 239—FORMS PRESCRIBED Item 21. Financial Statements ACTION: Final rule; correction. UNDER THE SECURITIES ACT OF 1933 * * * * * SUMMARY: The Food and Drug (d) * * * I 1. The general authority citation for (1) * * * Administration (FDA) is correcting a Part 239 continues to read as follows: final rule that published in the Federal Instructions. Register of July 20, 2004 (69 FR 43299). Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, The document issued a regulation to 77z–2, 77sss, 78c, 78l, 78m, 78n, 78o(d), 1. General. 78u–5, 78w(a), 78ll(d), 79e, 79f, 79g, 79j, 79l, (a) Round all figures in the table to the adjust for inflation the maximum civil 79m, 79n, 79q, 79t, 80a–8, 80a–24, 80a–26, nearest cent. money penalty amounts for various civil 80a–29, 80a–30, and 80a–37, unless * * * * * money penalty authorities within our otherwise noted. jurisdiction. The document published Dated: August 9, 2004. * * * * * with some errors and this document By the Commission. corrects those errors. Margaret H. McFarland, PART 274—FORMS PRESCRIBED DATES: The rule is effective September UNDER THE INVESTMENT COMPANY Deputy Secretary. 20, 2004. ACT OF 1940 [FR Doc. 04–18449 Filed 8–11–04; 8:45 am] FOR FURTHER INFORMATION CONTACT: BILLING CODE 8010–01–P Joyce A. Strong, Office of Policy (HF– I 2. The authority citation for part 274 27), Food and Drug Administration, continues to read as follows: 5600 Fishers Lane, Rockville MD, DEPARTMENT OF HEALTH AND Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 20857, 301–827–7010. HUMAN SERVICES 78c(b), 78l, 78m, 78n, 78o(d), 80a–8, 80a–24, SUPPLEMENTARY INFORMATION: In FR Doc. 80a–26, and 80a–29, unless otherwise noted. Food and Drug Administration 04–16388, appearing on page 43299 in * * * * * the Federal Register of Tuesday, July I 3. Instruction 1(a) to Item 21(d)(1) of 21 CFR Part 17 20, 2004, the following corrections are made: Form N–1A (referenced in §§ 239.15A [Docket No. 2003N–0308] and 274.11A) is amended to read as § 17.2 [Corrected] follows: Civil Money Penalties Hearings; Maximum Penalty Amounts and 1. On pages 43301 and 43302, in the Note: The text of Form N–1A does not and Compliance With the Federal Civil last column of the table (in dollars), this amendment will not appear in the Code paragraphs (a)(4), (a)(11), and (a)(12) are of Federal Regulations. Penalties Inflation Adjustment Act; Correction corrected to read: 16,500, 1,100, and 330,000, respectively. For the Form N–1A AGENCY: Food and Drug Administration, convenience of the reader, the table is * * * * * HHS. republished in its entirety:
CIVIL MONETARY PENALTIES AUTHORITIES ADMINISTERED BY FDA AND ADJUSTED MAXIMUM PENALTY AMOUNTS
Former Maximum Adjusted Maximum U.S.C. Section Description of Violation Penalty Amount (in Assessment Method Date of Last Penalty Amount (in dollars) Penalty dollars)
(a) 21 U.S.C.
(1) Violation of certain requirements 50,000 For each of the first two 2004 55,000 333(b)(2)(A) of the Prescription Drug Mar- violations in any 10-year keting Act (PDMA) period
(2) Violation of certain requirements 1,000,000 For each violation after 2004 1,100,000 333(b)(2)(B) of the PDMA the second conviction in any 10-year period
(3) 333(b)(3) Violation of certain requirements 100,000 Per violation 2004 110,000 of the PDMA
(4) 333(f)(1)(A) Violation of certain requirements 15,000 Per violation 2004 16,500 of the Safe Medical Devices Act (SMDA)
(5) 333(f)(1)(A) Violation of certain requirements 1,000,000 For the aggregate of vio- 2004 1,100,000 of the SMDA lations
(6) 333(f)(2)(A) Violation of certain requirements 50,000 Per individual 2004 55,000 of the Food Quality Protection Act of 1996 (FQPA)
(7) 333(f)(2)(A) Violation of certain requirements 250,000 Per ‘‘any other person’’ 2004 275,000 of the FQPA
(8) 333(f)(2)(A) Violation of certain requirements 500,000 For all violations adju- 2004 550,000 of the FQPA dicated in a single pro- ceeding
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CIVIL MONETARY PENALTIES AUTHORITIES ADMINISTERED BY FDA AND ADJUSTED MAXIMUM PENALTY AMOUNTS— Continued
Former Maximum Adjusted Maximum U.S.C. Section Description of Violation Penalty Amount (in Assessment Method Date of Last Penalty Amount (in dollars) Penalty dollars)
(9) 335b(a) Violation of certain requirements 250,000 Per violation for an indi- 2004 275,000 of the Generic Drug Enforce- vidual ment Act of 1992 (GDEA)
(10) 335b(a) Violation of certain requirements 1,000,000 Per violation for ‘‘any 2004 1,100,000 of the GDEA other person’’
(11) Violation of certain requirements 1,000 Per violation per person 2004 1,100 360pp(b)(1) of the Radiation Control for Health and Safety Act of 1968 (RCHSA)
(12) Violation of certain requirements 300,000 For any related series of 2004 330,000 360pp(b)(1) of the RCHSA violations
(b) 42 U.S.C.
(1) 263b(h)(3) Violation of certain requirements 10,000 Per violation 2004 11,000 of the Mammography Quality Standards Act of 1992 and the Mammography Quality Stand- ards Act of 1998
(2) 300aa– Violation of certain requirements 100,000 Per occurrence 2004 110,000 28(b)(1) of the National Childhood Vac- cine Injury Act of 1986
Dated: August 5, 2004. Pl., Rockville, MD 20855, 301–827– cumulatively have a significant effect on Jeffrey Shuren, 7815, e-mail: the human environment. Therefore, Assistant Commissioner for Policy. [email protected]. neither an environmental assessment [FR Doc. 04–18407 Filed 8–11–04; 8:45 am] SUPPLEMENTARY INFORMATION: Merial nor an environmental impact statement BILLING CODE 4160–01–S Ltd., 3239 Satellite Blvd., Bldg. 500, is required. Duluth, GA 30096–4640, filed a This rule does not meet the definition supplement to NADA 141–214 for of ‘‘rule’’ in 5 U.S.C. 804(3)(A) because DEPARTMENT OF HEALTH AND ZIMECTERIN GOLD (ivermectin 1.55 it is a rule of ‘‘particular applicability.’’ HUMAN SERVICES percent/praziquantel 7.75 percent) Paste Therefore, it is not subject to the for horses. This supplement amends congressional review requirements in 5 Food and Drug Administration product labeling to separate parasite life U.S.C. 801–808. stages in the indications section, to 21 CFR Part 520 List of Subjects in 21 CFR Part 520 remove the 8-week retreatment interval Animal drugs. Oral Dosage Form New Animal Drugs; from the dosage and administration Ivermectin and Praziquantel Paste section, and to add a new precaution I Therefore, under the Federal Food, statement. The supplemental NADA is Drug, and Cosmetic Act and under AGENCY: Food and Drug Administration, approved as of July 13, 2004, and 21 authority delegated to the Commissioner HHS. CFR 520.1198 is amended to reflect the of Food and Drugs and redelegated to the ACTION: Final rule. approval. The basis of approval is Center for Veterinary Medicine, 21 CFR discussed in the freedom of information part 520 is amended as follows: SUMMARY: The Food and Drug summary. Administration (FDA) is amending the In accordance with the freedom of PART 520—ORAL DOSAGE FORM animal drug regulations to reflect information provisions of 21 CFR part NEW ANIMAL DRUGS approval of a supplemental new animal 20 and 21 CFR 514.11(e)(2)(ii), a I drug application (NADA) filed by Merial summary of safety and effectiveness 1. The authority citation for 21 CFR Ltd. The supplemental NADA provides data and information submitted to part 520 continues to read as follows: revised labeling for ivermectin and support approval of this application Authority: 21 U.S.C. 360b. praziquantel oral paste used in horses may be seen in the Division of Dockets I 2. Section 520.1198 is amended by for the treatment and control of various Management (HFA–305), Food and Drug revising paragraphs (d)(2)(i) and (d)(3) to internal parasites. Administration, 5630 Fishers Lane, rm. read as follows: DATES: This rule is effective August 12, 1061, Rockville, MD 20852, between 9 2004. a.m. and 4 p.m., Monday through § 520.1198 Ivermectin and praziquantel paste. FOR FURTHER INFORMATION CONTACT: Friday. Martine Hartogensis, Center for The agency has determined under 21 * * * * * Veterinary Medicine (HFV–216), Food CFR 25.33(d)(1) that this action is of a (d) * * * and Drug Administration, 7519 Standish type that does not individually or (2) * * *
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(i) For treatment and control of the SUMMARY: This document contains means ‘‘created or organized in the following parasites in horses: temporary regulations providing United States or under the law of the Tapeworms—Anoplocephala perfoliata; clarification of the definitions of a United States or of any State unless, in Large strongyles (adults)—Strongylus corporation and a domestic entity in the case of a partnership, the Secretary vulgaris (also early forms in blood circumstances where the business entity provides otherwise by regulations.’’ vessels), S. edentatus (also tissue is considered to be created or organized Section 7701(a)(5) of the Code provides stages), S. equinus, Triodontophorus in more than one jurisdiction. These that the term foreign when applied to a spp. including T. brevicauda and T. regulations will affect business entities corporation or partnership means a serratus, and Craterostomum that are created or organized under the ‘‘corporation or partnership that is not acuticaudatum; Small Strongyles laws of more than one jurisdiction. The domestic.’’ This definition is (adults, including those resistant to final regulations consist of technical significantly different than the some benzimidazole class revisions to reflect the issuance of the definition of foreign entity that compounds)—Coronocyclus spp. temporary regulations and to correct a preceded it. The Revenue Act of 1918 including C. coronatus, C. labiatus, and cross-reference in § 301.7701–3. The used the term foreign to mean a C. labratus, Cyathostomum spp. text of the temporary regulations also corporation or partnership ‘‘created or including C. catinatum and C. serves as the text of the proposed organized outside the United States.’’ pateratum, Cylicocyclus spp. including regulations set forth in the notice of Thus, under that definition, a dually C. insigne, C. leptostomum, C. nassatus, proposed rulemaking on this subject in chartered entity that was organized in and C. brevicapsulatus, the Proposed Rules section in this issue the United States and in a foreign Cylicodontophorus spp., of the Federal Register. jurisdiction would have met the Cylicostephanus spp. including C. DATES: Effective Date: These regulations definitions of both a domestic entity and calicatus, C. goldi, C. longibursatus, and are effective August 12, 2004. a foreign entity, creating uncertainty as C. minutus, and Petrovinema Applicability Dates: For the dates of to the entity’s status. The Revenue Act poculatum; Small Strongyles—fourth- applicability of these regulations, see of 1924, Public Law 68–176 (43 Stat. stage larvae; Pinworms (adults and § 301.7701–2T(f) and § 301.7701–5T(c). 253) eliminated that potential for uncertainty by providing the definition fourth stage larvae)—Oxyuris equi; FOR FURTHER INFORMATION CONTACT: of a foreign entity that is currently Ascarids (adults and third- and fourth- Thomas Beem, (202) 622–3860 (not a reflected in section 7701(a)(5). This stage larvae)—Parascaris equorum; toll-free number). Hairworms (adults)—Trichostrongylus definition of a foreign entity as ‘‘a SUPPLEMENTARY INFORMATION: axei; Large-mouth Stomach Worms corporation or partnership that is not (adults)—Habronema muscae; Bots (oral Background domestic’’ makes it impossible for an entity to meet the definitions of both a and gastric stages)—Gasterophilus spp. Several jurisdictions have recently including G. intestinalis and G. nasalis; domestic entity and a foreign entity for enacted provisions (generally referred to Federal tax purposes at the same time. Lungworms (adults and fourth-stage as either continuance or domestication larvae)—Dictyocaulus arnfieldi; As a result, a dually chartered entity statutes) that make it possible for a that is organized both in the United Intestinal Threadworms (adults)— business entity to be treated as created Strongyloides westeri; Summer Sores States and in a foreign jurisdiction is a or organized under the laws of more domestic entity. caused by Habronema and Draschia than one jurisdiction at the same time spp. cutaneous third-stage larvae; Final regulations providing further (a dually chartered entity). A dually guidance on the definitions of domestic Dermatitis caused by neck threadworm chartered entity and the interest holders microfilariae, Onchocerca sp. and foreign business entities were in the entity must determine for Federal published in the Federal Register on * * * * * tax purposes (1) the entity’s November 17, 1960 (25 FR 10928 (3) Limitations. For oral use only. Do classification (e.g., corporation or (1960)). not use in horses intended for human partnership) and (2) whether the entity consumption. is foreign or domestic. The regulations Explanation of Provisions Dated: July 27, 2004. contained in this document are Under the existing rules, the Daniel G. McChesney, intended to clarify the rules for these characterization of a business entity for Director, Office of Surveillance and determinations. Federal tax purposes is established in Compliance, Center for Veterinary Medicine. Section 7701(a)(3) of the Internal two separate and independent steps. [FR Doc. 04–18406 Filed 8–11–04; 8:45 am] Revenue Code of 1986 (Code) provides The first involves a determination of BILLING CODE 4160–01–S that the term corporation includes whether the entity is a corporation or a associations, joint stock companies, and non-corporate entity (e.g., a insurance companies. The definition of partnership). The second involves a DEPARTMENT OF THE TREASURY a corporation under the tax statutes has determination of whether the entity is not changed since the Revenue Act of foreign or domestic. Internal Revenue Service 1918, Public Law 65–254 (40 Stat. 1057, The determination of whether a section 1). Final regulations (TD 8697) business entity is classified as a 26 CFR Part 301 providing rules for the classification of corporation is made by applying the business entities were published in the definition in § 301.7701–2(b). If the [TD 9153] Federal Register on December 18, 1996 entity is not a corporation under that RIN 1545–BD43 (61 FR 66584 (1996)). Those entity definition, then it is a partnership if it classification rules identify certain has more than one owner and it is a Clarification of Definitions entities that are always treated as disregarded entity if it has only a single AGENCY: Internal Revenue Service (IRS), corporations and are not eligible to elect owner. The temporary regulations in Treasury. their entity classification. this document clarify that this same Section 7701(a)(4) of the Code definition applies to dually chartered ACTION: Final and temporary provides that the term domestic when entities. Thus, to determine whether a regulations. applied to a corporation or partnership dually chartered entity is a corporation,
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it must first be determined if the entity’s regular tax principles that apply to such Authority: 26 U.S.C. 7805 * * * organization in any of the jurisdictions changes. Finally, the regulations I Par. 2. In § 301.7701–1, paragraph (d) in which it is organized would cause it contained in this document do not is revised to read as follows: to be treated as a corporation under the determine an entity’s place of residence rules of § 301.7701–2(b). If the entity for the purpose of applying the § 301.7701–1 Classification of would be treated as a corporation as a provisions of a tax treaty. organizations for federal tax purposes. result of its formation in any of the Section 7701(a)(4) of the Code * * * * * jurisdictions in which it is organized, it provides regulatory authority to define a (d) Domestic and foreign business is treated as a corporation for Federal domestic partnership other than based entities. [Reserved]. For further tax purposes even though its on where the partnership is created or guidance, see § 301.7701–1T. organization in the other jurisdiction or organized. The Treasury and the IRS are * * * * * jurisdictions would not have caused it continuing to explore whether, and I Par 3. Section 301.7701–1T is added to to be treated as a corporation. under what circumstances, a different read as follows: Once the classification of a business definition may be appropriate. If any entity has been determined, a change to the definition of a domestic § 301.7701–1T Classification of determination will generally need to be partnership were to be proposed, it organizations for federal tax purposes made regarding whether it is a domestic would apply only to partnerships (temporary). or foreign entity. It is a domestic entity created or organized after the issuance (a) through (c) [Reserved]. For further if it is created or organized in the United of regulations or other guidance guidance, see § 301.7701–1(a) through States or under the laws of the United substantially describing the change in (c). States or of any state. It is a foreign definition. (d) Domestic and foreign entities. See entity only if it is not domestic. The Special Analyses § 301.7701–5T for the rules that temporary regulations in this document determine whether a business entity is revise § 301.7701–5 to clarify that a It has been determined that this domestic or foreign. dually chartered entity is domestic if it Treasury decision is not a significant (e) through (f) [Reserved]. regulatory action as defined in is organized as any form of entity in the I Par. 4. In § 301.7701–2, paragraph Executive Order 12866. Therefore, a United States, regardless of how it is (b)(9) is added to read as follows: organized in any foreign jurisdiction. regulatory assessment is not required. It An entity that is classified as a also has been determined that section § 301.7701–2 Business entities; corporation because of its form of 553(b) of the Administrative Procedure definitions. organization in a foreign country is Act (5 U.S.C. chapter 5) does not apply * * * * * considered a domestic corporation if it to these regulations. For the (b) * * * is also organized as some form of entity applicability of the Regulatory (9) [Reserved]. For further guidance, in the United States, regardless of what Flexibility Act (5 U.S.C. chapter 6), refer see § 301.7701–2T(b)(9). to the Special Analyses section of the form the entity takes in the United * * * * * States (e.g., corporation, limited liability preamble to the notice of proposed I Par. 5. Section 301.7701–2T is added company, or partnership). rulemaking published in the proposed These temporary regulations also rules section in this issue of the Federal to read as follows: remove from § 301.7701–5 the Register. Pursuant to section 7806(f) of § 301.7701–2T Business entities; definitions of resident foreign the Code, these temporary regulations definitions (temporary). corporation, nonresident foreign will be submitted to the Chief Counsel (a) through (b)(8) [Reserved] For for Advocacy of the Small Business corporation, resident partnership and further guidance, see § 301.7701–2 (a) Administration for comment on their nonresident partnership because these through (b)(8). impact. terms have become obsolete due to (b)(9) Entities with multiple charters. statutory changes since the final Drafting Information (i) An entity created or organized under regulations were published in 1960. the laws of more than one jurisdiction These regulations clarify current law The principal author of these if the rules of this section would treat and do not change the outcome that regulations is Thomas Beem of the it as a corporation as a result of its would result under a proper application Office of Associate Chief Counsel formation in any one of the jurisdictions of the existing rules as they apply to (International). However, other in which it is created or organized. (The dually chartered entities. For example, personnel from the IRS and Treasury determination of a business entity’s the temporary regulations are consistent Department participated in their classification is made independently of with the result in Rev. Rul. 88–25 development. the determination whether the entity is (1988–1 C.B. 116). These regulations are List of Subjects in 26 CFR Part 301 domestic or foreign. See § 301.7701–5T also not intended to affect the result under existing rules regarding whether Employment taxes, Estate taxes, for the rules that determine whether a an organization is a separate entity for Excise taxes, Gift taxes, Income taxes, business entity is domestic or foreign.) Federal tax purposes (e.g., whether, in a Penalties, Reporting and Recordkeeping (ii) Examples. The following particular case, two sets of requirements. examples illustrate the rule of this paragraph (b)(9): organizational documents constitute Amendments to the Regulations different facets of a single entity or the Example 1. (i) Facts. X is an entity with a foundations of two separate entities). In I Accordingly, 26 CFR part 301 is single owner organized under the laws of addition, if a business entity undertakes amended as follows: Country A as an entity that is specifically a continuance, domestication, or other mentioned in paragraph (b)(8)(i) of this PART 301—PROCEDURE AND section. Under the rules of this section, such transaction that, upon application of ADMINISTRATION an entity generally is a corporation for these rules, changes its entity Federal tax purposes. Several years after its classification or changes its foreign or I Paragraph 1. The authority citation for formation, X files a certificate of domestic status, the tax effects of that part 301 continues to read, in part, as domestication in State B as a limited liability transaction are determined under the follows: company (LLC). Under the laws of State B,
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X is considered to be created or organized in corporation for Federal tax purposes because State B. Y has been classified as a corporation State B as a LLC upon the filing of the the rules of this section would treat Z as a for Federal tax purposes under the rules of certificate of domestication and is therefore corporation as a result of its formation in one §§ 301.7701–2, 301.7701–2T, and 301.7701– subject to the laws of State B. Under the rules of the jurisdictions in which it is created or 3. of this section and § 301.7701–3, a LLC with organized. (ii) Result. Y is a domestic corporation a single owner organized only in State B is because it is an entity that is classified as a disregarded as an entity separate from its (c) through (e) [Reserved]. For further corporation and it is organized as an entity owner for Federal tax purposes (absent an guidance, see § 301.7701–2(c) through under the laws of State B. election to be treated as an association). (e). Example 2. (i) Facts. P is an entity with Neither Country A nor State B law requires (f) Special effective date. The rules of more than one owner organized under the X to terminate its charter in Country A as a this section apply as of August 12, 2004 laws of Country A as an unlimited company. result of the domestication, and in fact X to all business entities existing on or It is also an entity that is organized as a does not terminate its charter in Country A. after that date. general partnership under the laws of State Consequently, X is now organized in more I B. P has been classified as a partnership for than one jurisdiction. Par. 6. In § 301.7701–3, the last Federal tax purposes under the rules of (ii) Result. X remains organized under the sentence of paragraph (b)(3)(i) is revised §§ 301.7701–2, 301.7701–2T, and 301.7701– laws of Country A as an entity that is to read as follows: 3. specifically mentioned in § 301.7701– (ii) Result. P is a domestic partnership § 301.7701–3 Classification of certain 2(b)(8)(i), and as such, it is an entity that because it is an entity that is classified as a generally is treated as a corporation under business entities. partnership and it is organized as an entity the rules of this section. Therefore, X is a * * * * * under the laws of State B. corporation for Federal tax purposes because (b) * * * (c) Effective date. The rules of this the rules of this section would treat X as a (3) * * * (i) * * *For special rules section apply as of August 12, 2004 to corporation as a result of its formation in one regarding the classification of such all business entities existing on or after of the jurisdictions in which it is created or entities prior to the effective date of this that date. organized. section, see paragraph (h)(2) of this Example 2. (i) Facts. Y is an entity that is section. Mark E. Matthews, incorporated under the laws of State A and that has two shareholders. Under the rules of * * * * * Deputy Commissioner for Services and this section, an entity incorporated under the I Par. 7. Section 301.7701–5 is revised to Enforcement. laws of State A is a corporation for Federal read as follows: Approved: July 21, 2004. tax purposes. Several years after its Gregory Jenner, formation, Y files a certificate of continuance § 301.7701–5 Domestic and foreign in Country B as an unlimited company. business entities. [Reserved]. For further Acting Assistant Secretary of the Treasury. Under the laws of Country B, upon filing a guidance, see § 301.7701–5T. [FR Doc. 04–18478 Filed 8–11–04; 8:45 am] certificate of continuance, Y is treated as I BILLING CODE 4830–01–P organized in Country B. Under the rules of Par. 8. Section 301.7701–5T is added this section and § 301.7701–3, an unlimited to read as follows: company organized only in Country B that § 301.7701–5T Domestic and foreign DEPARTMENT OF HOMELAND has more than one owner is treated as a business entities (temporary). SECURITY partnership for Federal tax purposes (absent (a) Domestic and foreign entities. A an election to be treated as an association). Coast Guard Neither State A nor Country B law requires business entity (including an entity that Y to terminate its charter in State A as a is disregarded as separate from its result of the continuance, and in fact Y does owner) is domestic if it is created or 33 CFR Part 100 not terminate its charter in State A. organized as any type of entity [CGD05–04–144] Consequently, Y is now organized in more (including, but not limited to, a than one jurisdiction. corporation, unincorporated association, RIN 1625–AA08 (ii) Result. Y remains organized in State A general partnership, limited as a corporation, an entity that is treated as Special Local Regulations for Marine a corporation under the rules of this section. partnership, and limited liability Events; Delaware River, Philadelphia, Therefore, Y is a corporation for Federal tax company) in the United States, or under PA purposes because the rules of this section the law of the United States or of any would treat Y as a corporation as a result of State. Accordingly, a business entity AGENCY: Coast Guard, DHS. its formation in one of the jurisdictions in that is created or organized both in the ACTION: Notice of implementation of which it is created or organized. United States and in a foreign regulation. Example 3. (i) Facts. Z is an entity that has jurisdiction is a domestic entity. A more than one owner and that is recognized business entity (including an entity that SUMMARY: The Coast Guard is under the laws of Country A as an unlimited is disregarded as separate from its implementing the special local company organized in Country A. Under the owner) is foreign if it is not domestic. regulations at 33 CFR 100.509 during rules of this section and § 301.7701–3, an the Labor Day Fireworks Show to be unlimited company organized only in (The determination of whether an entity Country A with more than one owner is is domestic is made independently of held September 6, 2004, on the treated as a partnership for Federal tax the determination of its classification for Delaware River at Philadelphia, purposes (absent an election to be treated as Federal tax purposes. See §§ 301.7701– Pennsylvania. These special local an association). At the time Z was formed, it 2, 301.7701–2T, and 301.7701–3 for the regulations are necessary to provide for was also organized as a public limited rules governing the classification of the safety of life on navigable waters company under the laws of Country B. Under entities.) before, during and after the event. The the rules of this section, a public limited (b) Examples. The following examples effect will be to restrict general company organized only in Country B illustrate the rules of this section: navigation in the regulated area for the generally is treated as a corporation for safety of spectators and support vessels Federal tax purposes. Example 1. (i) Facts. Y is an entity that is (ii) Result. Z is organized in Country B as created or organized under the laws of in the event area. a public limited company, an entity that Country A as a public limited company. It is DATES: 33 CFR 100.509 will be enforced generally is treated as a corporation under also an entity that is organized as a limited from 7:30 p.m. to 9 p.m. e.d.t. on the rules of this section. Therefore, Z is a liability company (LLC) under the laws of September 6, 2004.
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FOR FURTHER INFORMATION CONTACT: opening and closing of the bridge is no notification to the Coast Guard. This Fernando Serrano, Marine Information longer necessary. type of modification to the approved Specialist, Commander, Coast Guard DATES: This rule is effective August 12, permit plans requires a Coast Guard Group Philadelphia, 1 Washington 2004. bridge permit amendment. However, as Avenue, Philadelphia, Pennsylvania ADDRESSES: Documents referred to in a permit was not requested prior to the 19147, (215) 271–4944. this rule are available for inspection or modification to the bridge, a permit SUPPLEMENTARY INFORMATION: The copying at the office of the Eighth Coast amendment to change the bridge to a Penn’s Landing Corporation will Guard District, Bridge Administration fixed bridge was applied for and granted sponsor the ‘‘Labor Day Fireworks Branch, 500 Poydras Street, New after the fact. Since the bridge has been Show’’ on September 6, 2004, on the Orleans, Louisiana 70130–3310, modified to a fixed bridge, a special Delaware River, adjacent to Penn’s between 7 a.m. and 3 p.m., Monday operation regulation for a movable Landing, Philadelphia, Pennsylvania. In through Friday, except Federal holidays. bridge is unnecessary. order to ensure the safety of The telephone number is (504) 589– This final rule removes the regulation participants, spectators and transiting 2965. The Eighth District Bridge regarding the SR 24 bridge. vessels, 33 CFR 100.509 will be Administration Branch maintains the Regulatory Evaluation enforced for the duration of the event. public docket for this rulemaking. The special local regulations will be FOR FURTHER INFORMATION CONTACT: This rule is not a ‘‘significant enforced from 7:30 p.m. to 9 p.m. e.d.t. David Frank, Bridge Administration regulatory action’’ under section 3(f) of on September 6, 2004. The pyrotechnic Branch, at (504) 589–2965. Executive Order 12866, Regulatory display will be launched from 1 barge Planning and Review, and does not SUPPLEMENTARY INFORMATION: located within the regulated area. Under require an assessment of potential costs provisions of 33 CFR 100.509, a vessel Good Cause for Not Publishing an and benefits under section 6(a)(3) of that may not enter the regulated area unless NPRM Order. The Office of Management and it receives permission from the Coast We did not publish a notice of Budget has not reviewed it under that Guard Patrol Commander. Spectator proposed rulemaking (NPRM) for this Order. It is not ‘‘significant’’ under the vessels may anchor outside the regulation. Under 5 U.S.C. 553(b)(B), the regulatory policies and procedures of regulated area but may not block a Coast Guard finds good cause exists for the Department of Homeland Security navigable channel. not publishing an NPRM. Public (DHS). In addition to this notice, the comment is not necessary since the A special operating regulation exists maritime community will be provided bridge that the regulation governed has for movable bridges and as this bridge extensive advance notification via the been modified from a movable bridge to has been modified to a fixed bridge, the Local Notice to Mariners, marine a fixed and does not open for the regulation is unnecessary. We expect information broadcasts, and area passage of vessels. the economic impact of this rule to be newspapers, so mariners can adjust so minimal that a full Regulatory their plans accordingly. Good Cause for Making Rule Effective Evaluation under the regulatory policies in Less Than 30 Days Dated: August 3, 2004. and procedures of DHS is unnecessary. Sally Brice-O’Hara, Under 5 U.S.C. 553(d)(3), the Coast Small Entities Guard finds good cause exists for Rear Admiral, U.S. Coast Guard, Commander, Under the Regulatory Flexibility Act Fifth Coast Guard District. making this rule effective in less than 30 (5 U.S.C. 601–612), we have considered [FR Doc. 04–18475 Filed 8–11–04; 8:45 am] days after publication in the Federal Register because this rule removed the whether this rule would have a BILLING CODE 4910–15–P regulation used for the operation of a significant economic impact on a movable bridge that has been modified substantial number of small entities. The term ‘‘small entities’’ comprises DEPARTMENT OF HOMELAND to become a fixed bridge. The small businesses, not-for-profit SECURITY modification has already taken place and the removal of the regulation will organizations that are independently Coast Guard not affect mariners. owned and operated and are not dominant in their fields, and Background and Purpose 33 CFR Part 117 governmental jurisdictions with In 1977, LDOTD requested a change to populations of less than 50,000. [CGD08–04–028] the operating regulations for the SR 24 The Coast Guard certifies under 5 vertical lift bridge. The request was to U.S.C. 605(b) that this rule will not have RIN 1625–AA09 change the regulations on the bridge a significant economic impact on a Drawbridge Operation Regulation; that the bridge need not open for the substantial number of small entities. Terrebonne Bayou, Houma, LA passage of vessels due to infrequent This rule will have no impact on any openings. The basis of the change is that small entities. No small entities in the AGENCY: Coast Guard, DHS. between 1966 and 1977, the bridge only area have been affect by the ACTION: Final rule. opened four times. The request for modification of the bridge from a change was published in the Federal movable bridge to a fixed bridge. SUMMARY: The Coast Guard is removing Register and by Public Notice. On Assistance for Small Entities the existing drawbridge operation January 1, 1978, the regulation regarding regulation for the draw of the SR 24 the bridge was approved so that the Under section 213(a) of the Small bridge across Terrebonne Bayou, mile bridge need not open for the passage of Business Regulatory Enforcement 31.3, at Houma, Louisiana. The existing vessels. Fairness Act of 1996 (Pub. L. 104–121), bridge has been modified by permit In 1982, LDOTD issued a work order we want to assist small entities in from a movable bridge to a fixed bridge. to remove the counterweights, all of the understanding this rule so that they can Since the bridge is no longer a movable overhead structural steel and the better evaluate its effects on them and bridge, the regulation controlling the operator’s house without prior participate in the rulemaking process.
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Small businesses may send comments does not cause an environmental risk to a categorical exclusion under section on the actions of Federal employees health or risk to safety that might 2.B.2 of the Instruction. Therefore, this who enforce, or otherwise determine disproportionately affect children. rule is categorically excluded, under compliance with, Federal regulations to figure 2–1, paragraph (32)(e), of the Indian Tribal Governments the Small Business and Agriculture Instruction, from further environmental Regulatory Enforcement Ombudsman This rule does not have tribal documentation. Paragraph (32)(e) and the Regional Small Business implications under Executive Order excludes the promulgation of operating Regulatory Fairness Boards. The 13175, Consultation and Coordination regulations or procedures for Ombudsman evaluates these actions with Indian Tribal Governments, drawbridges from the environmental annually and rates each agency’s because it does not have a substantial documentation requirements of NEPA. responsiveness to small business. If you direct effect on one or more Indian List of Subjects in 33 CFR Part 117 wish to comment on actions by tribes, on the relationship between the employees of the Coast Guard, call 1– Federal Government and Indian tribes, Bridges. or on the distribution of power and 888–REG–FAIR (1–888–734–3247). Regulations responsibilities between the Federal Collection of Information Government and Indian tribes. I For the reasons set out in the preamble, This rule calls for no new collection the Coast Guard is amending Part 117 of Energy Effects of information under the Paperwork Title 33, Code of Federal Regulations as Reduction Act of 1995 (44 U.S.C. 3501– We have analyzed this rule under follows: 3520). Executive Order 13211, Actions Concerning Regulations That PART 117—DRAWBRIDGE Federalism Significantly Affect Energy Supply, OPERATION REGULATIONS Distribution, or Use. We have A rule has implications for federalism I 1. The authority citation for Part 117 determined that it is not a ‘‘significant under Executive Order 13132, continues to read as follows: Federalism, if it has a substantial direct energy action’’ under that order because effect on State or local governments and it is not a ‘‘significant regulatory action’’ Authority: 33 U.S.C. 499; Department of would either preempt State law or under Executive Order 12866 and is not Homeland Security Delegation No. 0170.1; 33 impose a substantial direct cost of likely to have a significant adverse effect CFR 1.05–1(g); section 117.255 also issued under the authority of Pub. L. 102–587, 106 compliance on them. We have analyzed on the supply, distribution, or use of Stat. 5039. this rule under that Order and have energy. The Administrator of the Office determined that it does not have of Information and Regulatory Affairs § 117.505 [Amended] implications for federalism. has not designated it as a significant I 2. In § 117.505, paragraph (b) is energy action. Therefore, it does not Unfunded Mandates Reform Act removed and paragraphs (c) and (d) and require a Statement of Energy Effects (e) are redesignated as (b) and (c) and (d). The Unfunded Mandates Reform Act under Executive Order 13211. of 1995 (2 U.S.C. 1531–1538) requires Dated: July 28, 2004. Technical Standards Federal agencies to assess the effects of R.F. Duncan, their discretionary regulatory actions. In The National Technology Transfer Rear Admiral, U.S. Coast Guard, Commander, particular, the Act addresses actions and Advancement Act (NTTAA) (15 Eighth Coast Guard District. that may result in the expenditure by a U.S.C. 272 note) directs agencies to use [FR Doc. 04–18487 Filed 8–11–04; 8:45 am] State, local, or tribal government, in the voluntary consensus standards in their BILLING CODE 4910–15–P aggregate, or by the private sector of regulatory activities unless the agency $100,000,000 or more in any one year. provides Congress, through the Office of Though this rule will not result in such Management and Budget, with an DEPARTMENT OF HOMELAND an expenditure, we do discuss the explanation of why using these SECURITY effects of this rule elsewhere in the standards would be inconsistent with preamble. applicable law or otherwise impractical. Coast Guard Voluntary consensus standards are Taking of Private Property technical standards (e.g., specifications 33 CFR Part 165 This rule will not affect a taking of of materials, performance, design, or [CGD05–04–148] private property or otherwise have operation; test methods; sampling taking implications under Executive procedures; and related management RIN 1625–AA87 Order 12630, Governmental Actions and systems practices) that are developed or Security Zone; Potomac River, Interference with Constitutionally adopted by voluntary consensus Washington, DC and Arlington and Protected Property Rights. standards bodies. Fairfax Counties, VA This rule does not use technical Civil Justice Reform standards. Therefore, we did not AGENCY: Coast Guard, DHS. This rule meets applicable standards consider the use of voluntary consensus ACTION: Temporary final rule. in sections 3(a) and 3(b)(2) of Executive standards. Order 12988, Civil Justice Reform, to SUMMARY: The Coast Guard is Environment minimize litigation, eliminate establishing a temporary security zone ambiguity, and reduce burden. We have analyzed this rule under for all waters of the Potomac River, from Commandant Instruction M16475.lD, the Woodrow Wilson Memorial Bridge Protection of Children which guides the Coast Guard in upstream to the Francis Scott Key We have analyzed this rule under complying with the National Bridge, including the water of the Executive Order 13045, Protection of Environmental Policy Act of 1969 Anacostia River downstream from the Children from Environmental Health (NEPA) (42 U.S.C. 4321–4370f), and Highway 50 Bridge to the confluence of Risks and Safety Risks. This rule is not have concluded that there are no factors the Potomac River. This security zone is an economically significant rule and in this case that would limit the use of needed to protect vessels, waterfront
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facilities, the public, and other to the public interest insofar as urgent COTP Baltimore or designated surrounding areas from destruction, action is required to address the ongoing representative. Vessels engaged in loss, or injury caused by sabotage, threat to U.S. maritime transportation commercial service desiring to enter the subversive acts, accidents, or other interests. security zone may request COTP actions of a similar nature performed by For the same reasons, under 5 U.S.C. authorization to enter the security zone individuals or groups reacting to current 553(d)(3), the Coast Guard finds that by contacting the COTP Baltimore or world events. All vessels engaged in good cause exists for making this rule COTP representative by telephone at commercial service are prohibited from effective less than 30 days after (202) 767–1194, or U.S. Coast Guard entering this security zone unless publication in the Federal Register. The Station Washington, DC on VHF–FM authorized by the Captain of the Port or measures contemplated by the rule are channels 16 or 23A. To allow adequate designated representative. intended to prevent waterborne acts of time to review each request, we DATES: This rule is effective from 8 a.m. sabotage or terrorism, which terrorists recommend that these vessels contact EDT August 3, 2004, through 8 a.m. EDT have demonstrated a capability to carry the COTP Activities Baltimore or November 30, 2004. out. Immediate action is needed to designated representative prior to the defend against and deter these terrorist ADDRESSES: Comments and material desired entry into the security zone. acts. Any delay in the effective date of received from the public, as well as this rule is impracticable and contrary Regulatory Evaluation documents indicated in this preamble as to the public interest. This rule is not a ‘‘significant being available in the docket are part of regulatory action’’ under section 3(f) of docket [CGD05–04–148] and are Background and Purpose Executive Order 12866, Regulatory available for inspection or copying at The U.S. Maritime Administration Planning and Review, and does not Commander, Coast Guard Activities (MARAD) in Advisory 02–07 advised require an assessment of potential costs Baltimore, 2401 Hawkins Point Road, U.S. shipping interests to maintain a and benefits under section 6(a)(3) of that Baltimore, MD 21226–1791 between 8 heightened state of alert against possible Order. The Office of Management and a.m. and 4 p.m., Monday through terrorist attacks. MARAD more recently Budget has not reviewed it under that Friday, except Federal holidays. issued Advisory 03–06 informing Order. It is not ‘‘significant’’ under the FOR FURTHER INFORMATION CONTACT: Mr. operators of maritime interests of regulatory policies and procedures of Ronald Houck, Waterways Management increased threat possibilities to vessels the Department of Homeland Security Branch, at Commander, Coast Guard and facilities and a higher risk of (DHS). Activities Baltimore, 2401 Hawkins terrorist attack to the transportation Although this rule restricts the access Point Road, Baltimore, MD 21226–1791, community in the United States. The of vessels engaged in commercial telephone number (410) 576–2674. ongoing hostilities in Afghanistan and service within the regulated area, the SUPPLEMENTARY INFORMATION: Iraq have made it prudent for U.S. ports effect of this rule will not be significant and waterways to be on a higher state because: (i) The COTP Activities Regulatory Information of alert because the al Qaeda Baltimore may authorize access to the We did not publish a notice of organization and other similar security zone on a case by case basis; (ii) proposed rulemaking (NPRM) for this organizations have declared an ongoing the security zone will be in effect for a regulation under 5 U.S.C. 553 (b)(B). intention to conduct armed attacks on limited duration; and (iii) the Coast The Coast Guard finds that good cause U.S. interests worldwide. Guard will make notifications via exists for not publishing an NPRM. The Due to increased awareness that maritime advisories so vessels engaged Coast Guard operates under a three- future terrorist attacks are possible, the in commercial service can adjust their tiered system of Maritime Security Coast Guard, as lead federal agency for plans accordingly. (MARSEC) conditions that are aligned maritime homeland security, has with the color-coded Homeland determined that the Captain of the Port Small Entities Security Advisory System Conditions Baltimore must have the means to be Under the Regulatory Flexibility Act (HSAS). The Department of Homeland aware of, deter, detect, intercept, and (5 U.S.C. 601–612), we have considered Security has recently raised the HSAS to respond to asymmetric threats, acts of whether this rule would have a color Orange based in part on threats to aggression, and attacks by terrorists on significant economic impact on a specific targets within the Washington the American homeland while still substantial number of small entities. D. C. metro area and, as a result, maintaining our freedoms and The term ‘‘small entities’’ comprises portions of the surrounding maritime sustaining the flow of commerce. This small businesses, not-for-profit environment has been elevated to the security zone is part of a comprehensive organizations that are independently second highest level of alert, MARSEC port security regime designed to owned and operated and are not II. Vessel control measures for the Coast safeguard human life, vessels, and dominant in their fields, and Guard to establish heightened waterfront facilities against sabotage or governmental jurisdictions with deterrence and detection of terrorist terrorist attacks. populations of less than 50,000. activities in the port are necessary. The Captain of the Port Baltimore is The Coast Guard certifies under 5 Additionally, the Maritime establishing a temporary security zone U.S.C. 605(b) that this rule will not have Administration recently issued MARAD for all waters of the Potomac River, from a significant economic impact on a Advisory 03–06 (221500ZDEC 03) the Woodrow Wilson Memorial Bridge substantial number of small entities. informing operators of maritime upstream to the Francis Scott Key This rule may affect the following interests of increased threat possibilities Bridge, including the water of the entities, some of which may be small to vessels and facilities and a higher risk Anacostia River downstream from the entities: the owners or operators of of terrorist attack to the transportation Highway 50 Bridge to the confluence of vessels engaged in commercial service community in the United States. the Potomac River. intending to transit the waters of the Further, the heightened security posture All vessels engaged in commercial Potomac River, from the Woodrow of the country and U.S. maritime service are prohibited from entering, Wilson Memorial Bridge upstream to interests, described below, continues. moving within, or remaining in this the Francis Scott Key Bridge, including The publication of an NPRM is contrary security zone unless authorized by the the water of the Anacostia River
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downstream from the Highway 50 Though this rule will not result in such Management and Budget, with an Bridge to the confluence of the Potomac an expenditure, we do discuss the explanation of why using these River from 8 a.m. EDT August 3, 2004, effects of this rule elsewhere in this standards would be inconsistent with through 8 a.m. EDT November 30, 2004. preamble. applicable law or otherwise impractical. This rule will not have a significant Voluntary consensus standards are Taking of Private Property economic impact on a substantial technical standards (e.g., specifications number of small entities for the reasons This rule will not effect a taking of of materials, performance, design, or enumerated under the Regulatory private property or otherwise have operation; test methods; sampling Evaluation above. taking implications under Executive procedures; and related management Order 12630, Governmental Actions and systems practices) that are developed or Assistance for Small Entities Interference with Constitutionally adopted by voluntary consensus Under section 213(a) of the Small Protected Property Rights. standards bodies. Business Regulatory Enforcement Civil Justice Reform This rule does not use technical Fairness Act of 1996 (Pub. L. 104–121), standards. Therefore, we did not we want to assist small entities in This rule meets applicable standards consider the use of voluntary consensus understanding the rule so that they in sections 3(a) and 3(b)(2) of Executive standards. could better evaluate its effects on them Order 12988, Civil Justice Reform, to and participate in the rulemaking minimize litigation, eliminate Environment process. If the rule will affect your small ambiguity, and reduce burden. We have analyzed this rule under Commandant Instruction M16475.1D, business, organization, or government Protection of Children jurisdiction and you have questions which guides the Coast Guard in concerning its provisions or options for We have analyzed this rule under complying with the National compliance, please contact the person Executive Order 13045, Protection of Environmental Policy Act of 1969 listed under FOR FURTHER INFORMATION Children from Environmental Health (NEPA) (42 U.S.C. 4321–4370f), and CONTACT for assistance in understanding Risks and Safety Risks. This rule is not have concluded that there are no factors this rule. an economically significant rule and in this case that would limit the use of Small businesses may send comments does not create an environmental risk to categorical exclusion under section on the actions of Federal employees health or risk to safety that may 2.B.2 of the Instruction. Therefore, this who enforce, or otherwise determine disproportionately affect children. rule is categorically excluded, under compliance with, Federal regulations to Indian Tribal Governments figure 2–1 paragraph (34)(g), of the the Small Business and Agriculture instruction, from further environmental Regulatory Enforcement Ombudsman This rule does not have tribal documentation because this rule is not and the Regional Small Business implications under Executive Order expected to result in any significant Regulatory Fairness Boards. The 13175, Consultation and Coordination environmental impact as described in Ombudsman evaluates these actions with Indian Tribal Governments, NEPA. A final ‘‘Environmental Analysis annually and rates each agency’s because it does not have a substantial Check List’’ and a final ‘‘Categorical responsiveness to small business. If you direct effect on one or more Indian Exclusion Determination’’ will be wish to comment on actions by tribes, on the relationship between the available where indicated under employees of the Coast Guard, call 1– Federal Government and Indian tribes, ADDRESSES. 888–REG–FAIR (1–888–734–3247). or on the distribution of power and responsibilities between the Federal List of Subjects in 33 CFR Part 165 Collection of Information Government and Indian tribes. Harbors, Marine safety, Navigation This rule calls for no new collection Energy Effects (water), Reporting and recordkeeping of information under the Paperwork requirements, Security measures, Reduction Act of 1995 (44 U.S.C. 3501– We have analyzed this rule under Waterways. Executive Order 13211, Actions 3520). I Concerning Regulations That For the reasons discussed in the Federalism Significantly Affect Energy Supply, preamble, the Coast Guard amends 33 CFR part 165 as follows: A rule has implications for federalism Distribution, or Use. We have under Executive Order 13132, determined that it is not a ‘‘significant PART 165—REGULATED NAVIGATION Federalism, if it has a substantial direct energy action’’ under that Order because AREAS AND LIMITED ACCESS AREAS effect on State or local governments and it is not a ‘‘significant regulatory action’’ would either preempt State law or under Executive Order 12866 and is not I 1. The authority citation for part 165 impose a substantial direct cost of likely to have a significant adverse effect continues to read as follows: compliance on them. We have analyzed on the supply, distribution, or use of Authority: 33 U.S.C. 1226, 1231; 46 U.S.C. this rule under that Order and have energy. The Administrator of the Office Chapter 701; 50 U.S.C. 191, 195; 33 CFR determined that it does not have of Information and Regulatory Affairs 1.05–1(g), 6.04–1, 6.04–6, and 160.5; Pub. L. implications for federalism. has not designated it as a significant 107–295; 116 Stat. 2064; Department of energy action. Therefore, it does not Homeland Security Delegation No. 0170.1. Unfunded Mandates Reform Act require a Statement of Energy Effects I 2. From 8 a.m. EDT August 3, 2004, The Unfunded Mandates Reform Act under Executive Order 13211. through 8 a.m. EDT November 30, 2004, of 1995 (2 U.S.C. 1531–1538) requires add temporary § 165.T05–148 to read as Federal agencies to assess the effects of Technical Standards follows: their discretionary regulatory actions. In The National Technology Transfer particular, the Act addresses actions and Advancement Act (NTTAA) (15 § 165.T05–148 Security Zone; Potomac that may result in the expenditure by a U.S.C. 272 note) directs agencies to use River, Washington, DC and Arlington and State, local, or tribal government, in the voluntary consensus standards in their Fairfax Counties, VA. aggregate, or by the private sector of regulatory activities unless the agency (a) Location. The following area is a $100,000,000 or more in any one year. provides Congress, through the Office of security zone: All waters of the Potomac
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River, from the Woodrow Wilson DEPARTMENT OF HOMELAND specific targets within the Washington, Memorial Bridge upstream to the SECURITY DC metro area and, as a result, portions Francis Scott Key Bridge, including the of the surrounding maritime water of the Anacostia River Coast Guard environment has been elevated to the downstream from the Highway 50 second highest level of alert, MARSEC Bridge to the confluence of the Potomac 33 CFR Part 165 II. Vessel control measures for the Coast River, extending the entire width of the [CGD05–04–151] Guard to establish heightened river. deterrence and detection of terrorist RIN 1625–AA87 activities in the port are necessary. (b) Definitions. (1) For the purposes of Additionally, the Maritime this section, Captain of the Port means Security Zone; Potomac River, Administration recently issued MARAD the Commander, U.S. Coast Guard Washington, DC Advisory 03–06 (221500ZDEC 03) Activities Baltimore, and any Coast AGENCY: Coast Guard, DHS. informing operators of maritime Guard commissioned, warrant, or petty interests of increased threat possibilities ACTION: Temporary final rule. officer who has been authorized by the to vessels and facilities and a higher risk Commander, U.S. Coast Guard SUMMARY: The Coast Guard is of terrorist attack to the transportation Activities Baltimore to act as a establishing a temporary security zone community in the United States. designated representative on his or her for all waters of the Georgetown Further, the heightened security posture behalf. Channel, Potomac River, from the Long of the country and U.S. maritime interests, described below, continues. (2) Commercial service includes any Railroad Bridge upstream to the Francis Scott Key Bridge. This security zone is The publication of an NPRM is contrary type of trade or business involving the needed to protect vessels, waterfront to the public interest insofar as urgent carriage of goods or persons for hire, facilities, the public, and other action is required to address the ongoing except services performed by a vessel on surrounding areas from destruction, threat to U.S. maritime transportation U.S. government service. loss, or injury caused by sabotage, interests. (c) Regulations. (1) The general subversive acts, accidents, or other For the same reasons, under 5 U.S.C. regulations contained in 33 CFR 165.33 actions of a similar nature performed by 553(d)(3), the Coast Guard finds that apply to all persons and vessels in the individuals or groups reacting to current good cause exists for making this rule security zone, or approaching the world events. All vessels are prohibited effective less than 30 days after security zone. from entering this security zone unless publication in the Federal Register. The measures contemplated by the rule are (2) All persons and vessels in the authorized by the Captain of the Port or designated representative. intended to prevent waterborne acts of security zone, or approaching the sabotage or terrorism, which terrorists DATES: This rule is effective from 8 a.m. security zone, shall comply with the have demonstrated a capability to carry e.d.t. August 3, 2004, through 8 a.m. instructions of the Captain of the Port. out. Immediate action is needed to e.d.t. November 30, 2004. Upon being hailed by a U.S. Coast defend against and deter these terrorist Guard vessel by siren, radio, flashing ADDRESSES: Comments and material acts. Any delay in the effective date of light, or other means, the operator of a received from the public, as well as this rule is impracticable and contrary vessel shall proceed as directed. documents indicated in this preamble as to the public interest. being available in the docket are part of (3) All vessels engaged in commercial docket (CGD05–04–151) and are Background and Purpose service are prohibited from entering this available for inspection or copying at The U.S. Maritime Administration security zone unless authorized by the Commander, Coast Guard Activities (MARAD) in Advisory 02–07 advised Captain of the Port or his or her Baltimore, 2401 Hawkins Point Road, U.S. shipping interests to maintain a designated representative. Vessels Baltimore, MD 21226–1791 between 8 heightened state of alert against possible engaged in commercial service seeking a.m. and 4 p.m., Monday through terrorist attacks. MARAD more recently authorization to enter the security zone Friday, except Federal holidays. issued Advisory 03–06 informing should contact the Captain of the Port FOR FURTHER INFORMATION CONTACT: Mr. operators of maritime interests of or designated representative by Ronald Houck, Waterways Management increased threat possibilities to vessels telephone at 202–767–1194, or U.S. Branch, at Commander, Coast Guard and facilities and a higher risk of Coast Guard Station Washington, DC on Activities Baltimore, 2401 Hawkins terrorist attack to the transportation VHF channels 16 or 23A. Point Road, Baltimore, MD 21226–1791, community in the United States. The Dated: August 3, 2004. telephone number (410) 576–2674. ongoing hostilities in Afghanistan and SUPPLEMENTARY INFORMATION: Iraq have made it prudent for U.S. ports Curtis A. Springer, and waterways to be on a higher state Captain, U.S. Coast Guard, Captain of the Regulatory Information of alert because the al Qaeda Port, Baltimore, Maryland. We did not publish a notice of organization and other similar [FR Doc. 04–18473 Filed 8–11–04; 8:45 am] proposed rulemaking (NPRM) for this organizations have declared an ongoing BILLING CODE 4910–15–P regulation under 5 U.S.C. 553(b)(B). The intention to conduct armed attacks on Coast Guard finds that good cause exists U.S. interests worldwide. for not publishing an NPRM. The Coast Due to increased awareness that Guard operates under a three-tiered future terrorist attacks are possible, the system of Maritime Security (MARSEC) Coast Guard, as lead federal agency for conditions that are aligned with the maritime homeland security, has color-coded Homeland Security determined that the Captain of the Port Advisory System Conditions (HSAS). Activities Baltimore must have the The Department of Homeland Security means to be aware of, deter, detect, has recently raised the HSAS to color intercept, and respond to asymmetric Orange based in part on threats to threats, acts of aggression, and attacks
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by terrorists on the American homeland through 8 a.m. e.d.t. November 30, 2004. effects of this rule elsewhere in this while still maintaining our freedoms This rule will not have a significant preamble. and sustaining the flow of commerce. economic impact on a substantial Taking of Private Property This security zone is part of a number of small entities for the reasons comprehensive port security regime enumerated under the Regulatory This rule will not effect a taking of designed to safeguard human life, Evaluation above. private property or otherwise have vessels, and waterfront facilities against taking implications under Executive sabotage or terrorist attacks. Assistance for Small Entities Order 12630, Governmental Actions and The Captain of the Port of Baltimore Under section 213(a) of the Small Interference with Constitutionally is establishing a temporary security Business Regulatory Enforcement Protected Property Rights. zone for all waters of the Georgetown Fairness Act of 1996 (Public Law 104– Civil Justice Reform Channel, Potomac River, from the Long 121), we want to assist small entities in Railroad Bridge upstream to the Francis understanding the rule so that they This rule meets applicable standards Scott Key Bridge. could better evaluate its effects on them in sections 3(a) and 3(b)(2) of Executive Vessels are allowed to enter, move and participate in the rulemaking Order 12988, Civil Justice Reform, to within, or remain in this security zone process. If the rule will affect your small minimize litigation, eliminate only with the authorization of the COTP business, organization, or government ambiguity, and reduce burden. Baltimore or designated representative. jurisdiction and you have questions Protection of Children Regulatory Evaluation concerning its provisions or options for compliance, please contact the person We have analyzed this rule under This rule is not a ‘‘significant Executive Order 13045, Protection of listed under FOR FURTHER INFORMATION regulatory action’’ under section 3(f) of Children from Environmental Health CONTACT for assistance in understanding Executive Order 12866, Regulatory this rule. Risks and Safety Risks. This rule is not Planning and Review, and does not an economically significant rule and require an assessment of potential costs Small businesses may send comments does not create an environmental risk to and benefits under section 6(a)(3) of that on the actions of Federal employees health or risk to safety that may Order. The Office of Management and who enforce, or otherwise determine disproportionately affect children. Budget has not reviewed it under that compliance with, Federal regulations to Indian Tribal Governments Order. It is not ‘‘significant’’ under the the Small Business and Agriculture regulatory policies and procedures of Regulatory Enforcement Ombudsman This rule does not have tribal the Department of Homeland Security and the Regional Small Business implications under Executive Order (DHS). Regulatory Fairness Boards. The 13175, Consultation and Coordination Although this rule restricts the access Ombudsman evaluates these actions with Indian Tribal Governments, of vessels to the regulated area, the annually and rates each agency’s because it does not have a substantial effect of this rule will not be significant responsiveness to small business. If you direct effect on one or more Indian because: (i) The COTP Baltimore may wish to comment on actions by tribes, on the relationship between the authorize access to the security zone on employees of the Coast Guard, call 1– Federal government and Indian tribes, a case by case basis; (ii) the security 888-REG-FAIR (1–888–734–3247). or on the distribution of power and zone will be in effect for a limited Collection of Information responsibilities between the Federal duration; and (iii) the Coast Guard will government and Indian tribes. make notifications via maritime This rule calls for no new collection Energy Effects advisories so vessels can adjust their of information under the Paperwork plans accordingly. Reduction Act of 1995 (44 U.S.C. 3501– We have analyzed this rule under 3520). Executive Order 13211, Actions Small Entities Federalism Concerning Regulations That Under the Regulatory Flexibility Act Significantly Affect Energy Supply, (5 U.S.C. 601–612), we have considered A rule has implications for federalism Distribution, or Use. We have whether this rule would have a under Executive Order 13132, determined that it is not a ‘‘significant significant economic impact on a Federalism, if it has a substantial direct energy action’’ under that Order because substantial number of small entities. effect on State or local governments and it is not a ‘‘significant regulatory action’’ The term ‘‘small entities’’ comprises would either preempt State law or under Executive Order 12866 and is not small businesses, not-for-profit impose a substantial direct cost of likely to have a significant adverse effect organizations that are independently compliance on them. We have analyzed on the supply, distribution, or use of owned and operated and are not this rule under that Order and have energy. The Administrator of the Office dominant in their fields, and determined that it does not have of Information and Regulatory Affairs governmental jurisdictions with implications for federalism. has not designated it as a significant populations of less than 50,000. Unfunded Mandates Reform Act energy action. Therefore, it does not The Coast Guard certifies under 5 require a Statement of Energy Effects U.S.C. 605(b) that this rule will not have The Unfunded Mandates Reform Act under Executive Order 13211. a significant economic impact on a of 1995 (2 U.S.C. 1531–1538) requires substantial number of small entities. Federal agencies to assess the effects of Technical Standards This rule may affect the following their discretionary regulatory actions. In The National Technology Transfer entities, some of which may be small particular, the Act addresses actions and Advancement Act (NTTAA) (15 entities: the owners or operators of that may result in the expenditure by a U.S.C. 272 note) directs agencies to use vessels intending to transit the waters of State, local, or tribal government, in the voluntary consensus standards in their the Georgetown Channel, Potomac aggregate, or by the private sector of regulatory activities unless the agency River, from the Long Railroad Bridge $100,000,000 or more in any one year. provides Congress, through the Office of upstream to the Francis Scott Key Though this rule will not result in such Management and Budget, with an Bridge from 8 a.m. e.d.t. August 3, 2004, an expenditure, we do discuss the explanation of why using these
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standards would be inconsistent with (b) Definitions. For the purposes of DATES: Effective September 13, 2004. applicable law or otherwise impractical. this section, Captain of the Port means FOR FURTHER INFORMATION CONTACT: R. Voluntary consensus standards are the Commander, U.S. Coast Guard technical standards (e.g., specifications Activities Baltimore, and any Coast Barthen Gorman, Media Bureau, (202) of materials, performance, design, or Guard commissioned, warrant, or petty 418–2180. operation; test methods; sampling officer who has been authorized by the SUPPLEMENTARY INFORMATION: This is a procedures; and related management Commander, U.S. Coast Guard synopsis of the Commission’s systems practices) that are developed or Activities Baltimore to act as a Memorandum Opinion and Order, MB adopted by voluntary consensus designated representative on his or her Docket No. 02–76, adopted July 28, standards bodies. behalf. 2004, and released July 30, 2004. The This rule does not use technical (c) Regulations. (1) The general full text of this Commission decision is standards. Therefore, we did not regulations contained in 33 CFR 165.33 available for inspection and copying consider the use of voluntary consensus apply to all persons and vessels in the during normal business hours in the standards. security zone, or approaching the FCC’s Reference Information Center at security zone. Environment Portals II, 445 12th Street, SW., Room (2) All persons and vessels in the CY-A257, Washington, DC, 20554. The We have analyzed this rule under security zone, or approaching the Commandant Instruction M16475.1D, security zone, shall comply with the document may also be purchased from which guides the Coast Guard in instructions of the Captain of the Port. the Commission’s duplicating complying with the National Upon being hailed by a U.S. Coast contractor, Best Copy and Printing, Inc., Environmental Policy Act of 1969 Guard vessel by siren, radio, flashing Portals II, 445 12th Street, SW., Room (NEPA) (42 U.S.C. 4321–4370f), and light, or other means, the operator of a CY-B402, Washington, DC, 20554, have concluded that there are no factors vessel shall proceed as directed. Vessels telephone 202 863–2893, facsimile 202 in this case that would limit the use of are allowed to enter, move within, or 863–2898. The Commission will send a categorical exclusion under section remain in this security zone only with copy of this Memorandum Opinion and 2.B.2 of the Instruction. Therefore, this the authorization of the Captain of the Order in a report to be sent to Congress rule is categorically excluded, under Port or designated representative. and the General Accounting Office figure 2–1 paragraph (34)(g), of the Dated: August 3, 2004. pursuant to the Congressional Review instruction, from further environmental Act, see 5 U.S.C. 801(a)(1)(A). documentation because this rule is not Curtis A. Springer, expected to result in any significant Captain, U.S. Coast Guard, Captain of the List of Subjects in 47 CFR Part 73 environmental impact as described in Port, Baltimore, Maryland. NEPA. A final ‘‘Environmental Analysis [FR Doc. 04–18482 Filed 8–11–04; 8:45 am] Radio, Radio broadcasting. Check List’’ and a final ‘‘Categorical BILLING CODE 4910–15–P I Part 73 of Title 47 of the Code of Exclusion Determination’’ will be Federal Regulations is amended as available where indicated under follows: ADDRESSES. FEDERAL COMMUNICATIONS COMMISSION List of Subjects in 33 CFR Part 165 PART 73—RADIO BROADCAST SERVICES Harbors, Marine safety, Navigation 47 CFR Part 73 (water), Reporting and recordkeeping [DA 04–2394; MB Docket No. 02–76; RM– I 1. The authority citation for Part 73 requirements, Security measures, 10405, 10499] reads as follows: Waterways. Authority: 47 U.S.C. 154, 303, 334, and I For the reasons discussed in the Radio Broadcasting Services; Belle 336. preamble, the Coast Guard proposes to Haven, VA, Crisfield, MD, Exmore, amend 33 CFR part 165 as follows: Nassawadox, and Poquoson, VA § 73.202 [Amended] AGENCY: Federal Communications PART 165—REGULATED NAVIGATION I 2. Section 73.202(b), the Table of FM Commission. AREAS AND LIMITED ACCESS AREAS Allotments under Maryland, is amended ACTION: Final rule. I 1. The authority citation for part 165 by adding Channel 250A and by continues to read as follows: SUMMARY: In response to a petition for removing Channel 245A at Crisfield. Authority: 33 U.S.C. 1226, 1231; 46 U.S.C. reconsideration of a Report and Order, I 3. Section 73.202(b), the Table of FM Chapter 701; 50 U.S.C. 191, 195; 33 CFR 68 FR 59748 (October 17, 2003), this allotments under Virginia, is amended 1.05–1(g), 6.04–1, 6.04–6, and 160.5; Pub. L. Memorandum Opinion and Order by adding Channel 252A and by 107–295; 116 Stat. 2064; Department of substitutes Channel 250A for Channel removing Channel 250B1 at Belle Haven. Homeland Security Delegation No. 0170.1. 245A at Crisfield, Maryland, and Federal Communications Commission. I 2. From 8 a.m. e.d.t. August 3, 2004 substitutes Channel 252A for Channel John A. Karousos, through 8 a.m. e.d.t. November 30, 2004, 250B1 at Belle Haven, Virginia. The add temporary § 165.T05–151 to read as coordinates for Channel 250A at Assistant Chief, Audio Division, Media follows: Crisfield, Maryland are 37–54–51 NL Bureau. and 75–42–45 WL, with a site restriction [FR Doc. 04–18465 Filed 8–11–04; 8:45 am] § 165.T05–151 Security Zone; Potomac of 14.63 kilometers (9.1 miles) southeast BILLING CODE 6712–01–P River, Washington, D.C. of Crisfield. The coordinates for (a) Location. The following area is a Channel 252A at Belle Haven, Virginia, security zone: All waters of the are 37–33–14 NL and 75–49–14 WL, Georgetown Channel, Potomac River, with a site restriction of 0.04 kilometers from the Long Railroad Bridge upstream (0.02 miles) southeast of Belle Haven, to the Francis Scott Key Bridge. Virginia.
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DEPARTMENT OF TRANSPORTATION noncompliances in motor vehicles and defect or noncompliance with a FMVSS equipment to include reimbursement under 49 U.S.C. 30118. See 49 U.S.C. National Highway Traffic Safety plans that, at a minimum, cover certain 30120(g)(1). As explained in the Administration expenditures incurred to remedy the preamble to the final rule, in the TREAD defect or noncompliance before the Act reimbursement provision, Congress 49 CFR Parts 573 and 577 implementation of the recall. See 49 required a reimbursement period [Docket No. NHTSA 2001–11107; Notice 3] CFR 573.13 and 577.11 (2003). The covering persons who incurred the cost reader is referred to that notice, and the of the remedy within a ‘‘reasonable time RIN 2127–AJ05 prior Notice of Proposed Rulemaking in advance’’ of the manufacturer’s (NPRM), 66 FR 64078 (December 11, notification under section 30118.1 We Motor Vehicle Safety; Reimbursement 2001), for further information. therefore concluded that the period for Prior to Recall The rule requires manufacturers to reimbursement should be limited by AGENCY: National Highway Traffic provide reimbursement, at a minimum, this language. 67 FR at 64051. We also Safety Administration (NHTSA), DOT. to consumers who obtain a pre- noted that Congress was well aware of notification remedy within a specified ACTION: Response to a petition for statutory periods for free remedies (49 time period. The beginning of the reconsideration. U.S.C. 30120(g)(1)), since it had minimum reimbursement period is extended those periods in section 4 of SUMMARY: This document denies a determined by first considering the the TREAD Act, and the fact that it did petition for reconsideration of a final underlying categorical basis for the not reference it in the reimbursement rule issued by NHTSA with respect to recall. For recalls based upon a safety- provision of the Act cannot be viewed the reimbursement of costs incurred by related defect, the start of the minimum as inadvertent. See 67 FR at 64052. owners of motor vehicles or motor reimbursement period is the date Thus, we reasoned that not all pre- vehicle equipment to remedy of safety- NHTSA’s Office of Defects Investigation notification remedies within the free related defects or noncompliances with (ODI) opens an investigation known as remedy period were to be eligible for a Federal motor vehicle safety standard an engineering analysis (EA) or one year reimbursement. (FMVSS). That final rule implemented prior to the date the manufacturer In deciding what time period section 6(b) of the Transportation Recall submits its notice of a defect to NHTSA constituted a ‘‘reasonable time in Enhancement, Accountability, and pursuant to 49 U.S.C. 30118(b) or (c) advance’’ of a manufacturer’s Documentation (TREAD) Act. Under the and 49 CFR Part 573, whichever is notification of a defect or rule, in their programs to remedy earlier. For recalls based upon a noncompliance, we relied upon the defects or noncompliances, motor noncompliance with a FMVSS, the start statutory concerns underlying the vehicle and motor vehicle equipment of the minimum reimbursement period remedy of noncompliances with manufacturers are required to include a is the date of the observation of a test FMVSSs and safety-related defects, and plan for reimbursing owners for the cost failure by either the manufacturer or where applicable, the agency’s of a remedy incurred within specified NHTSA. investigative process. See 67 FR at times before and shortly after the The end of the minimum 64051–53 and 66 FR at 64078–79 manufacturer’s notification of the defect reimbursement period is determined by (December 11, 2001) (NPRM). As noted or noncompliance. the nature of the product being recalled. in the NPRM, we believe that the For motor vehicles, the end date is ten minimum period for reimbursement FOR FURTHER INFORMATION CONTACT: For days after the date the manufacturer need not begin before consumers would non-legal issues, contact George Person, mailed the last of its notices to owners be expected to have a substantial Office of Defects Investigation, NHTSA pursuant to 49 CFR 577.5. For concern that the problem in question (phone: 202–366–5210). For legal issues, replacement equipment, the end date is would need to be addressed by a safety contact Andrew DiMarsico, Office of ten days after the date the manufacturer recall. See 66 FR at 64079. As explained Chief Counsel, NHTSA (phone: 202– mailed the last of its notices pursuant to above, in our view, for noncompliances 366–5263). 49 CFR 577.5 or 30 days after the this would be when NHTSA or the SUPPLEMENTARY INFORMATION: conclusion of the manufacturer’s initial manufacturer observes a test failure; for efforts to provide public notice of the safety defects, it would be when ODI I. Background existence of the defect or opens an EA or one year before the Section 6(b) of the TREAD Act noncompliance pursuant to 49 CFR manufacturer submits its Part 573 amended 49 U.S.C. 30120(d) to require 577.7, whichever is later. Manufacturers notice, whichever is earlier. See 67 FR a manufacturer’s remedy program to may (and generally do) provide 64079. Before these dates, in our view, include a plan for reimbursing an owner reimbursement for a longer period than there would be no reason for a or purchaser who incurred the cost of required under the rule. consumer to anticipate a safety recall the remedy within a reasonable time in The agency based the regulatory would be forthcoming. While an owner advance of the manufacturer’s delineation of ‘‘reasonable time’’ on the of a motor vehicle or motor vehicle notification under 49 U.S.C. 30118 (b) or language and legislative history of equipment may need to address a (c). Section 6(b) further authorized the section 6(b) of the TREAD Act. We also problem in his or her vehicle or Secretary to prescribe regulations considered the free remedy provision of equipment prior to these dates, and thus establishing what constitutes a the National Traffic and Motor Vehicle incur the cost of a remedy, the overall reasonable time and other reasonable Safety Act, as amended, 49 U.S.C. level of concern over the matter will not conditions for the reimbursement plan. Chapter 301 (Safety Act). Under the have reached a level such that a recall See 49 U.S.C. 30120(d). Safety Act, manufacturers of motor On October 17, 2002, NHTSA vehicles and equipment that are recalled 1 In addition to the differences in the time periods published a final rule implementing the must provide a remedy without charge of the free remedy provision and the reimbursement reimbursement provision of the TREAD unless the vehicle or replacement provision, the provisions run from different dates. The free remedy runs from the date of the first Act. 67 FR 64049. The final rule equipment was bought by a first purchase; the reimbursement period begins at a required manufacturers’ programs for purchaser more than 10 calendar years reasonable time in advance of the manufacturer’s remedying safety defects and (5 years for a tire) before notice of a notification under 49 U.S.C. § 30118(b) or (c).
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would be anticipated. Thus, under the the amendment. PC/CAS’s reliance on Representatives passed H.R. 5164 as rule, reasonable concerns would not the Luther amendment is misplaced reported out of Committee. See 146 dictate delaying the replacement or the because they fail to recognize that Cong. Rec. H9624–32 (2000). The Senate repair of a problematic part on the basis Congressman Luther’s amendment was passed H.R. 5164 on October 11, 2000. of an expectation that with a delay a free modified before the bill was enacted. See 146 Cong. Rec. S10272 (2000).3 The initial bills introduced in both remedy would be available under a 2. The Purposes of the TREAD Act recall, as was the case with the the House of Representatives (H.R. Firestone tires that preceded the 5164) and the Senate (S. 3059) in the PC/CAS next argue that the time enactment of the TREAD Act. There, as wake of the Firestone tire investigation periods established in the reported to NHTSA, some owners did not include any reimbursement reimbursement rule are inconsistent delayed replacing Firestone tires, which language. Mr. Luther’s amendment, with the purposes of the TREAD Act. were under investigation and offered during the mark-up of the bill in PC/CAS broadly advance various determined to be defective shortly the House Subcommittee on purposes of the TREAD Act such as: to thereafter, because they would have to Telecommunications, Trade, and ‘‘incentivize’’ recalls and pay for the replacements, but would not Consumer Protection on September 21, ‘‘disincentivize’’ stonewalls; discourage have to do so if there was a recall. 2000, would have required: foot dragging by manufacturers by Public Citizen (PC) and the Center for making it less financially advantageous a manufacturer to fully reimburse the owner to delay announcement of a recall; to Auto Safety (CAS) (collectively ‘‘PC/ of a motor vehicle which replaces equipment CAS’’) jointly filed a timely petition for on a motor vehicle before a recall is ordered influence customer behavior; to reconsideration of the rule. under subsection (a) or (b) because such encourage the timely replacement of equipment is defective or not in compliance defective parts and remedy a defect II. Discussion with a motor vehicle safety standard. before an official acknowledgement; to expand consumers’ rights; to provide PC/CAS’s petition contends that the This proposed amendment did not refer meaningful recourse to consumers mandatory reimbursement period to any time limitation for the period for affected by a recall; and not limit established by the final rule is too reimbursement. reimbursement in a manner contrary to limited. PC/CAS take issue with both However, the full Committee did not good public policy. PC/CAS broadly the beginning date and the end date of adopt Mr. Luther’s reimbursement assert that the agency’s reimbursement the required reimbursement period. language. On October 6, 2000, during rule fails to further these purposes of the the mark-up conducted by the full A. Beginning Date of the Reimbursement TREAD Act. Period Committee on Commerce, its Chairman, PC/CAS’s broad assertions of various Congressman Billy Tauzin, offered an and sundry purposes of the TREAD Act PC/CAS object to the beginning date amendment to Mr. Luther’s of the reimbursement period on various lack support or citation. Even if one reimbursement provision. Among other could read some provisions of the grounds. They first argue that NHTSA’s changes, Chairman Tauzin’s regulation is inconsistent with the TREAD Act as being consistent with amendment, which was ultimately some or all of these asserted purpose of a reimbursement amendment enacted as section 6(b) of the TREAD offered by Congressman Bill Luther ‘‘purposes,’’ it would not support PC/ Act, added a time limitation to the CAS’s arguments. Section 6(b) cannot during the deliberations on the TREAD period for reimbursement: Act. More broadly, throughout their fairly be viewed as an omnibus petition, they claim that the agency’s A manufacturer’s remedy program shall provision that authorized NHTSA to determination of what constitutes a include a plan for reimbursing an owner or adopt rules to advance general policies. purchaser who incurred the cost of the ‘‘reasonable time’’ is inconsistent with We must be guided by the language of remedy within a reasonable time in advance the statutory provision. Thus, for the overall purposes of the TREAD Act. of the manufacturer’s notification under They also assert that the rule fails to subsection (b) or (c) of section 30118. The example, while we agree with PC/CAS provide a ‘‘uniform’’ remedy and that Secretary may prescribe regulations that an apparent congressional purpose NHTSA therefore should have adopted establishing what constitutes a reasonable of Section 6(b) was to expand consumer one of two ‘‘bright-line’’ rules. They also time for purposes of the preceding sentence rights by creating an obligation on contend that the rule does not advance and other reasonable conditions for the manufacturers to provide several of their policy choices. reimbursement plan. reimbursement to purchasers for some Our responses follow. The Commerce Committee reported pre-recall expenditures that was not previously required under the Safety 1. The Luther Amendment H.R. 5164, as amended, to the House of Representatives. See H.R. Report No. Act, that would not resolve the scope of PC/CAS assert that the period for 106–954, p. 11 (2000). The summary the rule. The critical question is the reimbursement in the rule is section of the report stated, ‘‘[F]urther, extent of the rights, which requires inconsistent with the purpose of a the legislation addresses * * * consideration of the statutory term ‘‘a proposed amendment offered by reimbursement for parts replaced reasonable time in advance of Congressman Bill Luther to the bill that immediately prior to a recall.’’ Id. at p. notification.’’ That is just what NHTSA ultimately became the TREAD Act. PC/ 6 (emphasis supplied). did. CAS argue that Congressman Luther’s No further amendments to the 3. Uniform Statutory Remedy amendment was intended to encourage reimbursement provision were offered consumers to act on safety defects as in the House. The full House of PC/CAS further argue that the soon as they are evident, rather than reimbursement rule does not provide a wait for a formal recall, and that a apply if the motor vehicle or replacement ‘‘uniform statutory remedy’’ because the reimbursement period that falls short of equipment was bought by the first purchaser more the period for a free remedy under than 10 calendar years, or the tire, including an 3 The reimbursement provision was inadvertently 2 original equipment tire, was bought by the first left out of H.R. 5164 as reported. On October 12, section 30120(g)(1) is inconsistent with purchaser more than 5 calendar years, before notice 2000, the House of Representatives passed H. Con. is given under section 30118(c) of this title or an Res. 428 to add it. See 146 Cong. Rec. H9852 (2000). 2 Section 30120(g)(1) states: The requirement that order is issued under section 30118(b) of this title, The Senate passed H. Con. Res. 428 on October 17, a remedy be provided without charge does not whichever is earlier. 2000. See 146 Cong. Rec. S10632 (2000).
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reimbursement period is based upon the owners possibly entitled to PC/CAS cite a handful of specific timing of the remedy rather than the reimbursement. instances where manufacturers have nature of the remedy. PC/CAS contend The Safety Act requires manufacturers delayed conducting recalls, such as that this can cause similarly situated to notify NHTSA and owners of vehicles Ford’s recall of model year (MY) 1988– consumers to be treated differently. and equipment when the manufacturer 93 vehicles with defective ignition PC/CAS do not point to any language learns that the vehicle or equipment switches and Chrysler’s recall of MY in Section 6(b) of the TREAD Act that contains a defect and decides in good 1993–95 Chrysler LH vehicles to supports its assertion that the faith that the defect is related to motor address fuel rail leaks. These examples reimbursement period should be based vehicle safety, or decides in good faith do not make their case. To begin, in on the nature of the remedy or that all that the vehicle or equipment does not view of the small numbers, they are not persons who remedied a defect or comply with an applicable FMVSS. See representative. Vehicle manufacturers noncompliance prior to the 49 U.S.C. 30118(c)(1) and (2). Such undertake hundreds of recalls per year. manufacturer’s notification must have notification must be given within a In 2003, vehicle manufacturers the same right to reimbursement. By its reasonable time after the manufacturer conducted 529 vehicle recalls; the terms, the TREAD Act’s reimbursement first decides that a safety-related defect average number of recalls per year for provision is oriented toward the timing or noncompliance exists under section the last five years is 471. In 2003, of the remedy; it expressly refers to 30118(c). See 49 U.S.C. 30119(c)(2). A approximately 75 percent (or 401) were reimbursement of a purchaser who manufacturer cannot evade its statutory undertaken by manufacturers in the ‘‘incurred the cost of the remedy within obligations ‘‘by the expedient of absence of investigations by NHTSA. a reasonable time in advance of the declining * * * to reach its own manufacturer’s notification.’’ Second, PC/CAS have not conclusion as to the relationship demonstrated that a desire on the part Accordingly, in circumstances where between a defect in its vehicles and one vehicle was repaired before the of manufacturers to limit reimbursing * * * safety.’’ United States v. General owners was a factor, much less a beginning of the reimbursement period Motors Corp., 574 F. Supp. 1047, 1050 and another vehicle was repaired during significant factor, in delaying the cited (D.D.C. 1983). Thus, a manufacturer recalls. Ordinarily, a recall is triggered the reimbursement period, the fact that incurs its duties to notify and remedy the rule does not require the owner of if only a small fraction of vehicles whether it actually determined, or it exhibit a defect. See, United States v. the first vehicle to be reimbursed is should have determined, that its entirely consistent with the statute and General Motors Corp., 518 F.2d 420 vehicles are defective and the defect is (D.C. Cir. 1975) (Wheels) (holding that a its legislative history. safety-related. The failure to perform We note that even under PC/CAS wheel is defective if there were a these duties in a timely manner is a significant number of failures and view that the reimbursement period violation of the Safety Act that can should be based on the time for a free noting that the term ‘‘significant’’ subject the manufacturer to substantial remedy under section 30120(g)(1), there indicates that there must be a non-de civil penalties. See 49 U.S.C. 30165.4 may be differences in eligibility for minimus number of failures. 518 F.2d at The TREAD Act also reduced the reimbursement. For example, in cases 438 fn. 84.) The significant cost in a likelihood that NHTSA will be unaware where a defective part is used for recall campaign is the cost of remedying of a potential safety problem. Prior to several model years, under PC/CAS’s the vehicles that have been recalled. In the TREAD Act, in deciding whether to preferred ‘‘bright-line’’ approach, comparison, the cost of reimbursing open a defect investigation, NHTSA owners of vehicles under 10 years old owners of the small fraction of vehicles relied heavily on owner complaints to would be eligible for reimbursement, that have been repaired before the recall obtain information about potential while owners of vehicles with the same is not particularly significant. Thus, problems. The TREAD Act significantly defective part that are more than 10 while it is possible that a manufacturer expanded the nature and amount of years old would not be eligible for would improperly delay a recall, it is information NHTSA receives reimbursement. highly unlikely that such a decision authorizing the agency to require would be driven by anticipated 4. Manufacturers’ Reduction of Their manufacturers to submit a wide variety reimbursement costs. In addition, once Liability of information related to potential they decide to conduct a recall, many One of PC/CAS’s central themes is defects. See Sections 3(a) and 3(b) of the manufacturers provide broad that by basing the time frame for the TREAD Act, 49 U.S.C. 30166(l) and (m). reimbursement, in part as a matter of duty to reimburse on the opening of an NHTSA implemented these provisions customer relations. In fact, in both the Engineering Analysis in a defect by requiring manufacturers submit Early Ford ignition switch and Chrysler fuel investigation, the longer a manufacturer Warning Reporting (EWR) information, rail recalls, Ford and Chrysler offered can ward off an EA, the lower its reports on foreign recalls, and various reimbursement to all consumers who liability. PC/CAS thus claim that the advisories and bulletins. See 49 CFR had remedied the problems prior to the reimbursement rule creates an incentive Part 579. This information will reduce announcement of the recall, regardless for manufacturers to delay a recall and a manufacturer’s ability to delay or of the length of time involved.6 The fact stonewall the agency. avoid a recall in the hope that the As discussed above, Section 6(b) was agency will not become aware of a real- 5 SUVs, N.Y. Times, February 27, 2004, at C1. In the not framed in terms of incentives for world safety problem. same article, Joan Claybrook, President of Public timely recalls. Moreover, we do not Citizen, one of the petitioners here, said the action agree that the reimbursement rule 4 Section 5(a) of the TREAD Act significantly showed that the new system worked. Id. at C5. increased the potential amount of such civil 6 Ford’s notification letters to owners advising of would encourage a manufacturer to penalties from $1,000 to $5,000 per violation and a defect in the ignition switch provided that Ford delay a recall. There are several factors increased the maximum civil penalty for a related would provide a refund if the owner obtained the that encourage the timely determination series of violations from $925,000 to $15,000,000. remedy before the date of the owner notification and notification of safety-related defects 5 For example, EWR information recently helped letter. Chrysler also offered reimbursement to lead to the early identification of a safety problem owners who remedied the fuel rail leaks prior to and noncompliances that far outweigh in, and the recall of, certain tires manufactured by recall. See Carson v. DaimlerChrysler Corp., No. any possible cost savings that might be Bridgestone/Firestone, Inc. See Danny Hakim, W2001–03088, 2003 WL 1618076 (Tenn. Ct. App. achieved through limiting the number of Another Recall Involving Ford, Firestone Tires and March 19, 2003).
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that Ford and Chrysler provided the agency (see 49 CFR 573.6(c)(7)) and which consumers may submit a claim reimbursement without any time is objectively determinable. for reimbursement for the costs of a pre- limitation (and provided it before the PC/CAS also argue that the agency notification remedy. In fact, statutory requirement to do so) further could have adopted one of two bright- manufacturers are not allowed to demonstrates that a desire to reduce the line rules to determine ‘‘reasonable establish a cut-off date for the cost of potential reimbursements is not time’’ in the rulemaking. PC/CAS first submission of reimbursement claims. a factor that would cause manufacturers suggest a bright line derived from While in the NPRM we originally to improperly delay defect or consumer law, i.e., one based on the proposed to allow manufacturers to noncompliance determinations. discovery rule. According to PC/CAS, establish a cut-off date (see 66 FR at the applicable period of time to seek 64083), for reasons explained in the 5. Other Concerns recovery would run from the date the preamble to the final rule, we decided PC/CAS contend that as a result of its consumer discovers the defect recall not to do so (see 67 FR at 64059). tying ‘‘reasonable time’’ to the agency’s remedy, which is the date of the receipt Therefore, based upon the above, we investigative processes, the of the manufacturer’s recall notice, and are denying PC/CAS’s petition for reimbursement rule is unnecessarily would continue until barred by a state reconsideration of the reimbursement complex and consumers will be law statute of limitations. rule. unaware of the reference point for the PC/CAS’s petition itself reveals a III. Rulemaking Analyses reimbursement period. As we stated in basic flaw in its discovery rule the preamble to the final rule, we find approach, which renders it irrelevant. It NHTSA set forth its rulemaking it unnecessary for consumers to know states that it is based on consumer law; analyses in the preamble to the final how ‘‘reasonable time’’ is determined or it does not purport to be based on rule. This supplements those have an intimate knowledge of Section 6(b) of the TREAD Act. The statements. Under the Paperwork NHTSA’s investigative process. See 67 discovery rule approach is not in accord Reduction Act of 1995, and OMB’s FR at 64052. Under the rule, with the Act, because it does not regulation at 5 CFR 1320.5(b)(2), on June manufacturers must provide the specific provide for reimbursement of an owner 9, 2004, NHTSA received approval from dates for the period of reimbursement in or purchaser who incurred the cost of OMB for an amendment to a previously- their reimbursement plans and provide the remedy within a reasonable time in approved information collection appropriate notice to consumers. See 49 advance of the manufacturer’s requirement (OMB control number CFR 577.11(d)(3). notification. It provides for 2127–0004) that includes the PC/CAS raise a narrow issue reimbursement of costs incurred within reimbursement rule. involving the start of the reimbursement an unlimited time before a Issued on: August 9, 2004. period when the recall was based on a manufacturer’s notification. Also, this Jeffrey W. Runge, noncompliance with a FMVSS. They approach, which depends on state laws, Administrator. which may differ or may not exist, does assert that tying reimbursement to the [FR Doc. 04–18485 Filed 8–11–04; 8:45 am] ‘‘ ‘date of the [manufacturer’s] initial test not produce a bright line. failure or the initial observation of a The second, and better approach BILLING CODE 4910–59–P possible noncompliance’ confers upon according to PC/CAS, is to adopt the 10- manufacturers virtually unrestricted year/5-year time frame for a free repair DEPARTMENT OF TRANSPORTATION leeway to define a reimbursement provided by section 30120(g)(1) as the period, latitude that would likely be reasonable time frame for National Highway Traffic Safety advantageous to manufacturers at the reimbursement. As discussed above, Administration expense of consumers.’’ this is neither required by, nor As explained in the preamble to the consistent with, Section 6(b). 49 CFR Part 579 NPRM, the observation of a possible End Date for Reimbursement [Docket No. NHTSA 2001–8677; Notice 11] noncompliance through testing or observation is a critical point in the PC/CAS also seek reconsideration of RIN 2127–AI25 initiation of a recall because, while not the end dates for the reimbursement determinative of a noncompliance, it is period established in the final rule. This Reporting of Information and the triggering event for OVSC or a is apparently based on a Documents About Potential Defects; manufacturer to conduct an misunderstanding of the rule. Correction The end date for the reimbursement investigation into the potential AGENCY: period is the last date on which a National Highway Traffic noncompliance. See 66 FR at 64078– Safety Administration (NHTSA), DOT. 64079; see also 67 FR at 64051–64052. consumer may incur costs that are ACTION: Correcting amendment. Thus, we based the start of the eligible for reimbursement. We established such a date because Section reimbursement period for recalls related SUMMARY: This document contains a 6(b) is designed to assure coverage of to noncompliances with a FMVSS on correction to the final early warning the reimbursement of remedy costs that the date of the observation of an reporting rule, which initially was are incurred in advance of the apparent failure. Before that time, published on July 10, 2002 (67 FR manufacturer’s notification. Once a consumers will have no reason to 45822). believe that a noncompliance exists, and consumer receives a recall notice, any will be unlikely to seek a remedy based subsequent remedial action should be in DATES: This final rule is effective August on a concern about safety. accordance with the terms of the recall.7 12, 2004. We also disagree that this provision PC/CAS seem to believe that the end FOR FURTHER INFORMATION CONTACT: will allow manufacturers to manipulate date in the rule limits the period during Jonathan White, Office of Defects the reimbursement period. The date of Investigation, NHTSA (phone: 202–366– 7 Pursuant to 49 U.S.C. 30120, the manufacturer 5226). the initial observation of a possible initially determines the type of remedy available to noncompliance is identified by the the consumer after notification of a noncompliance SUPPLEMENTARY INFORMATION: On July manufacturer in its Part 573 report to or safety defect. 10, 2002, NHTSA published a final rule
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implementing the early warning I Accordingly, 49 CFR part 579 is those transmitted by computer, telefax, reporting (EWR) provisions of the corrected by making the following or other electronic means and including Transportation Recall Enhancement, correcting amendment. warranty and policy extension Accountability, and Documentation communiques and product (TREAD) Act, 49 U.S.C. 30166(m) (67 PART 579—REPORTING OF improvement bulletins) other than those INFORMATION AND FR 45822). At the same time, we required to be submitted pursuant to COMMUNICATIONS ABOUT reorganized 49 CFR part 573. As a result § 573.6(c)(9) of this chapter, sent to POTENTIAL DEFECTS of that reorganization, 49 CFR 573.5 was more than one manufacturer, renumbered as 49 CFR 573.6. I 1. The authority citation for part 579 distributor, dealer, lessor, lessee, owner, or purchaser, in the United States, One section of the EWR regulations, continues to read as follows: regarding any defect in its vehicles or 49 CFR 579.5(a), currently references 49 Authority: Sec. 3, Pub. L. 106–414, 114 items of equipment (including any CFR 573.5(c)(9). In view of the Stat. 1800 (49 U.S.C. 30102–103, 30112, failure or malfunction beyond normal reorganization of part 573, this reference 30117–121, 30166–167); delegation of authority at 49 CFR 1.50. deterioration in use, or any failure of was incorrect. The correct reference is performance, or any flaw or unintended 49 CFR 573.6(c)(9) because, as noted Subpart A—General deviation from design specifications), above, section 573.5 was renumbered as whether or not such defect is safety- section 573.6 in 2002. I 2. Revise paragraph (a) of § 579.5 to related. read as follows: Today’s amendment corrects this * * * * * error. § 579.5 Notices, bulletins, customer Issued on: August 6, 2004. List of Subjects in 49 CFR Part 579 satisfaction campaigns, consumer advisories, and other communications. Kenneth N. Weinstein, Imports, Motor vehicle safety, Motor (a) Each manufacturer shall furnish to Associate Administrator for Enforcement. vehicles, Reporting and recordkeeping NHTSA a copy of all notices, bulletins, [FR Doc. 04–18353 Filed 8–11–04; 8:45 am] requirements. and other communications (including BILLING CODE 4910–59–P
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Proposed Rules Federal Register Vol. 69, No. 155
Thursday, August 12, 2004
This section of the FEDERAL REGISTER • E-mail: Address your comment to Layer (the Montreal Protocol). EPA also contains notices to the public of the proposed [email protected]. Your regulates methyl bromide under the issuance of rules and regulations. The comment must be contained in the body Federal Insecticide, Fungicide, and purpose of these notices is to give interested of your message; do not send attached Rodenticide Act (FIFRA) (7 U.S.C. 136 persons an opportunity to participate in the files. Please include your name and et seq.). rule making prior to the adoption of the final rules. address in your message and ‘‘Docket The United States is a Party to the No. 02–086–1’’ on the subject line. Montreal Protocol, an international • Agency Web Site: Go to http:// treaty that provides a schedule to reduce DEPARTMENT OF AGRICULTURE www.aphis.usda.gov/ppd/rad/ and eventually eliminate the emissions cominst.html for a form you can use to of various manmade, ozone-depleting Animal and Plant Health Inspection submit an e-mail comment through the substances, including methyl bromide. Service APHIS Web site. The Montreal Protocol requires a • Federal eRulemaking Portal: Go to phaseout of methyl bromide production 7 CFR Part 304 http://www.regulations.gov and follow and consumption in developed the instructions for locating this docket [Docket No. 02–086–1] countries, including the United States, and submitting comments. by the year 2005 and in developing RIN 0579–AB54 Reading Room: You may read any countries by the year 2015. However, comments that we receive on this the Montreal Protocol exempts Methyl Bromide; Official Quarantine docket in our reading room. The reading quarantine and pre-shipment (QPS) Uses room is located in room 1141 of the applications of methyl bromide from AGENCY: Animal and Plant Health USDA South Building, 14th Street and these phaseout requirements. Inspection Service, USDA. Independence Avenue, SW., The Farm Security and Rural ACTION: Proposed rule. Washington, DC. Normal reading room Investment Act of 2002 amended the hours are 8 a.m. to 4:30 p.m., Monday Plant Protection Act (PPA) by adding a SUMMARY: We are proposing to establish through Friday, except holidays. To be new sec. 419 (7 U.S.C. 7719) that regulations to provide for the sure someone is there to help you, pertains specifically to methyl bromide. submission of requests by State, local, or please call (202) 690–2817 before Among other things, the amendment tribal authorities for a determination coming. requires the Secretary of Agriculture, whether methyl bromide treatments or Other Information: You may view upon request of State, local, or tribal applications required by the State, local, APHIS documents published in the authorities, to determine whether a or tribal authorities to prevent the Federal Register and related methyl bromide treatment or introduction, establishment, or spread information, including the names of application required by those of plant pests or noxious weeds should groups and individuals who have authorities to prevent the introduction, be authorized as official quarantine commented on APHIS dockets, on the establishment, or spread of plant pests uses. These proposed regulations are Internet at http://www.aphis.usda.gov/ (including diseases) or noxious weeds necessary to comply with a recent ppd/rad/webrepor.html. should be authorized as an official amendment to the Plant Protection Act FOR FURTHER INFORMATION CONTACT: Dr. control or official requirement. The that requires the Secretary to publish Inder P. Gadh, Treatment Specialist, Secretary may not make such a and maintain a registry of authorized Phytosanitary Issues Management, PPQ, determination unless she finds that State, local, and tribal requirements for APHIS, 4700 River Road Unit 140, there is no other registered, effective, methyl bromide treatments or Riverdale, MD 20737; (301) 734–6799. and economically feasible alternative applications. This proposed rule would SUPPLEMENTARY INFORMATION: available. The amendment also directs establish a process by which State, the Secretary to publish and maintain a local, or tribal authorities could request Background registry of those State, local, and tribal and, if warranted, receive, a Methyl bromide is a broad-spectrum requirements for methyl bromide determination that their methyl bromide pesticide used as a fumigant to control treatments and applications that she has requirements should be authorized as insect pests, nematodes, weeds, and determined should be authorized as an official quarantine uses. pathogens. Its primary uses are for soil official control or official requirement. DATES: We will consider all comments fumigation, post-harvest protection, and We are proposing to establish that we receive on or before October 12, quarantine treatments. regulations to comply with the 2004. In the United States, production, requirements of this amendment to the ADDRESSES: You may submit comments consumption, and trade of methyl PPA. Specifically, we are proposing to by any of the following methods: bromide are regulated by the add a new part 304 to our regulations • Postal Mail/Commercial Delivery: Environmental Protection Agency (EPA) in title 7 of the Code of Federal Please send four copies of your under the Clean Air Act, as amended Regulations that would establish comment (an original and three copies) (42 U.S.C. 7401 et seq.). The Clean Air procedures that State, local, and tribal to Docket No. 02–086–1, Regulatory Act provides the basic framework to authorities would have to follow when Analysis and Development, PPD, regulate air quality through air pollution submitting a request to the APHIS, Station 3C71, 4700 River Road control, and it has been amended to Administrator of the Animal and Plant Unit 118, Riverdale, MD 20737–1238. reflect changes in U.S. obligations under Health Inspection Service (APHIS), Please state that your comment refers to the 1987 Montreal Protocol on acting on behalf of the Secretary of Docket No. 02–086–1. Substances that Deplete the Ozone Agriculture, to have a required methyl
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bromide application or treatment distributed; or (2) to meet official establish a parallel or alternative recognized as an official control or quarantine requirements for the regulatory mechanism governing the official requirement. The proposed management of economic plant pests in consumption of methyl bromide. As we regulations also describe the criteria that plant material intended for note in proposed § 304.2(e), the the Administrator would use to evaluate propagation.’’ Administrator of the Environmental such requests. In contrast, in its January 3, 2003, Protection Agency will continue to final rule titled ‘‘Protection of exempt, consistent with the Montreal Definitions Stratospheric Ozone: Process for Protocol and under the authority of the Section 304.1 of the proposed Exempting Quarantine and Preshipment Clean Air Act, quarantine applications regulations includes three standard Applications of Methyl Bromide’’ (68 of methyl bromide. In addition, the definitions that are consistent with FR 237–254), under authority of section proposed regulations are not intended to those used elsewhere in our regulations. 604(d)(5) of the Clean Air Act, the EPA have any effect on requirements issued We would define Administrator as the defined the term quarantine by EPA under FIFRA. Administrator of the Animal and Plant applications, in part, as ‘‘treatments to Health Inspection Service or any prevent the introduction, establishment Requests for Determination; Review of individual authorized to act for the and/or spread of quarantine pests Determinations Administrator; Animal and Plant Health (including diseases), or to ensure their Section 304.2 of the proposed Inspection Service (APHIS) as the official control, where: (1) Official regulations, ‘‘Requests for Animal and Plant Health Inspection control is that performed by, or determination,’’ contains general Service of the U.S. Department of authorized by, a national (including provisions pertaining to requests for Agriculture (USDA); and State as any of state, tribal or local) plant, animal or authorization of methyl bromide uses as the several States of the United States, environmental protection or health official quarantine uses, criteria that the the Commonwealth of the Northern authority; (2) quarantine pests are pests Administrator would use in evaluating Mariana Islands, the Commonwealth of of potential importance to the areas such requests, and a description of the Puerto Rico, the District of Columbia, endangered thereby and not yet present process by which a previously Guam, the Virgin Islands of the United there, or present but not widely authorized official quarantine use may States, or any other territory or distributed and being officially be removed from the registry when possession of the United States. The controlled. This definition excludes appropriate. section would also include definitions treatments of commodities not entering Paragraph (a) would indicate that a of control and requirement. Control or leaving the United States or any State State, local, or tribal authority may would be defined as ‘‘suppression, (or political subdivision thereof).’’ With request that the Administrator containment, or eradication of a pest the exception of the last sentence, this determine whether a methyl bromide population,’’ which is the same definition tracked the definition of treatment or application required by the definition found in the International ‘‘quarantine application’’ with respect to State, local, or tribal authority should be Plant Protection Convention’s Glossary methyl bromide agreed among parties to authorized as an official quarantine use. of Phytosanitary Terms. Requirement the Montreal Protocol, including the Paragraph (b) would provide that the would be defined as ‘‘a treatment or United States, in 1995 (Decisions VII/5). Administrator will make a application to prevent the introduction, There are differences between our determination in response to a request establishment or spread of pests.’’ This proposed definition of official not later than 90 days after its receipt. proposed definition is drawn from the quarantine use and EPA’s definition of The Administrator would issue a common EPA and Montreal Protocol quarantine applications because we favorable determination if the methyl definition of the term ‘‘quarantine believe that it is important for our bromide treatment or application under applications.’’ definition to explicitly provide for those consideration conformed to the Proposed § 304.1 also includes a instances where the treatment of plant definition of official quarantine use in definition of official quarantine use, material intended for propagation may § 304.1 and if he or she found that no under which the terms ‘‘official control’’ be required by a particular State, local, other registered, effective, and and ‘‘official requirement’’ would be or tribal authority for quarantine economically feasible alternative to subsumed. We believe that defining and purposes. We welcome any suggestions methyl bromide existed for that using the single term official quarantine or specific comments regarding our treatment or application. This paragraph use would aid officials of State, local, proposed definition of official would also provide that if the and tribal authorities by succinctly quarantine use. Administrator determined that a methyl characterizing the type of methyl As noted earlier in this document, the bromide treatment or application should bromide application or treatment for EPA, under the authority of the Clean not be authorized as an official quarantine purposes that would qualify Air Act, regulates the production, quarantine use, the Administrator as an official control or official consumption, and trade of methyl would provide to the requestor, in requirement. bromide in the United States. It should writing, the reasons for his or her We would define official quarantine also be noted that paragraph (d)(2) of the determination. use in § 304.1 as: ‘‘A methyl bromide new sec. 419 of the PPA provides that Given that the terms ‘‘registered, treatment or application that the ‘‘[n]othing in this section shall be effective, and economically feasible’’ are Administrator determines to be an construed to alter or modify the not defined in sec. 419, we expect that official control or official requirement, authority of the Administrator of the these terms, as they would apply to the based on information that the treatment Environmental Protection Agency or to consideration of requests, would have or application is required by a State, provide any authority to the Secretary of their commonly understood meanings, local, or tribal authority for either of the Agriculture under the Clean Air Act or i.e.: following reasons: (1) For the regulations promulgated under the • ‘‘Registered’’ means a pesticide management of plant pests or noxious Clean Air Act.’’ We wish to make it registered or otherwise approved by weeds of potential importance to the clear that in issuing this proposed rule, EPA for a specific use; area endangered thereby and not yet our intent is to fulfill our • ‘‘Effective’’ means that there is a present there, or present but not widely responsibilities under sec. 419, not to body of science with sufficient rigor and
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specificity to show that an alternative effectiveness and economic feasibility of a result of the review process described treatment would meet the efficacy the alternative, just as we would in our in the previous paragraph, the requirements to allow its consideration review of a new request for a Administrator rescinds the as a quarantine treatment; and determination under proposed determination that a methyl bromide • ‘‘Economically feasible’’ means that § 304.2(b). The State, local, or tribal treatment or application was an official the costs of the alternative quarantine authority that had requested and quarantine use. In its request for treatment would not be so high as to received the determination that the reconsideration, the State, local, or make the trade in the treated good methyl bromide treatment or tribal authority would have to provide, prohibitively expensive. application under review was an official in writing, the facts and reasons upon We welcome any suggestions or quarantine use would be invited to which it is relying to show that the specific comments regarding our participate in the review. If, as a result treatment or application should be interpretation of these criteria, of the review, APHIS finds that the authorized as an official quarantine use particularly with respect to factors that registered alternative is effective and or that the determination should remain you believe could or should be taken economically feasible, we would in effect. The Administrator would take into account while considering the rescind the determination that the into account the information provided economic feasibility of a potential methyl bromide treatment or in the request for reconsideration and alternative to methyl bromide. application was an official quarantine any other relevant facts, including the While the proposed regulations use. While this proposed review process information provided in the original themselves do not address research, we is not explicitly called for by sec. 419, request for determination, and would wish to note that the Administrator’s we believe that it is in keeping with the render a decision as promptly as determination that a particular objectives of the section to provide for circumstances permitted. The treatment or application should be such a review. Administrator’s decision, and his or her authorized as an official quarantine use While the regulations in proposed reasons for that decision, would be has the effect of spurring further § 304.2(c) would provide that the communicated to the requestor in research into alternatives to that Administrator may rescind the writing. treatment or application. Specifically, determination that a methyl bromide APHIS will consult with EPA as paragraph (b) of sec. 419 provides, in treatment or application is an official appropriate in the course of evaluating part, that ‘‘[f]or uses where no quarantine use when a registered, requests to determine whether methyl registered, effective, economically effective, and economically feasible bromide uses should be authorized as feasible alternatives available can alternative becomes available, we wish official quarantine uses and whether currently be identified, the Secretary to acknowledge the possibility that an and when a previously authorized shall initiate research programs to alternative may become available that is official quarantine use may be removed develop alternative methods of control effective and economically feasible, but from the registry. and treatment.’’ Ongoing USDA research that is not subject to registration by EPA Submission of Requests activities led by the Agricultural (non-chemical treatments such as Research Service are investigating irradiation have been cited as an Proposed § 304.3 describes the alternatives for major uses of methyl example). We are explicitly seeking information that would have to be bromide. The research requirements of comment on whether our regulations included in any request to the sec. 419 may influence the allocation of should take such a possibility into Administrator for a determination that a research resources, to the extent that it account. Mainly, we are interested in methyl bromide application or provides specific statutory justification learning if this is a practical treatment should be authorized as an for research on alternatives to methyl consideration, i.e., whether or not you official quarantine use. Paragraph (a) bromide used for quarantine purposes, believe that there may actually be would state that the request must be and may influence the areas of emphasis instances where an alternative that is submitted and signed by the executive within the array of federally funded not subject to registration by EPA could official or a plant protection official of research programs on alternatives. State, prove to be an effective and the State, local, or tribal authority local, or tribal authorities may value economically feasible application for a seeking the determination, and must federally mandated efforts to develop particular use, and thus might serve as include a copy of the State, local, or registered, effective and economically a desirable alternative to methyl tribal regulation or mandatory feasible alternatives to quarantine uses bromide. If indeed this is a practical quarantine procedures under which the of methyl bromide. This interest could consideration, should the regulations methyl bromide treatment or be expected to strengthen as the cost of provide some mechanism for the application is required; the name of the methyl bromide use increases. review, voluntary or otherwise, of a crop/use for which the methyl bromide Proposed paragraph (c) provides for listed treatment or application such as treatment or application is required; the the review of authorized uses. As that provided for by proposed name of the plant pests or noxious proposed, a review would be triggered § 304.2(c)? We welcome all comments weeds targeted for control with methyl by the registration by EPA of a new on this subject. bromide; and the location(s) where the pesticide, or a new use for an existing Under proposed paragraph (d), a methyl bromide treatment or pesticide, that could serve as an State, local, or tribal authority that has application is carried out. We believe alternative to the treatment or submitted a request for a determination that this specific information, which application authorized as an official would, in the event that the would be considered along with more quarantine use. We believe that Administrator determines that the general information available to APHIS, registration is a logical trigger for such particular methyl bromide treatment or would be necessary for the a review, given that it would serve as an application should not be authorized as Administrator to be able to make a indication of the likely availability of a an official quarantine use, have the determination regarding the methyl new treatment or application that could opportunity to request that the bromide treatment or application that is serve as an alternative to an official Administrator reconsider his or her the subject of the request. Paragraph (b) quarantine use of methyl bromide. In its determination. This same opportunity would provide an address for the review, APHIS would consider the would be provided in the event that, as submission of requests.
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Registry or official requirements. The significant economic impact on a Finally, as required by sec. 419(c) of amendment also requires the Secretary substantial number of small entities, as the amended PPA, proposed § 304.4 to publish and maintain a registry of required by the Regulatory Flexibility would state that all State, local, and these authorized uses and to initiate Act. Many, if not most, of the tribal requirements for methyl bromide research programs to develop viable agricultural enterprises that use methyl applications or treatments that are methyl bromide alternatives. bromide are small entities. However, the A methyl bromide use included in the determined by the Administrator to be effects of this proposed rule on small, as registry would be termed an official official quarantine uses will appear on well as large, entities is not expected to quarantine use. It would be an official a registry of such treatments or be significant. The new sec. 419 and the quarantine requirement or control of a proposed regulations would not affect applications that will be published and State, local, or tribal authority for either maintained by the Administrator. This the exemption of quarantine of the following purposes: (i) For the applications from the methyl bromide section would provide an address to management of plant pests or noxious which one could write to receive a copy phaseout. The Administrator of the weeds of potential importance to the Environmental Protection Agency will of the registry, as well as an Internet area endangered thereby and not yet Web site (http://www.aphis.usda.gov/ continue to exempt, consistent with the present there, or present but not widely Montreal Protocol and under the ppq/bromide/) where the registry would distributed; or (ii) to meet official be posted. authority of the Clean Air Act, quarantine requirements for the quarantine applications of methyl Executive Order 12866 and Regulatory management of economic plant pests in bromide. At most, the requirements of Flexibility Act plant material intended for propagation. sec. 419 may influence the focus of Much of U.S. agriculture, especially This proposed rule has been reviewed research on methyl bromide horticultural production, is currently alternatives. under Executive Order 12866. The rule dependent upon methyl bromide for the Implementation of sec. 419 will has been determined to be significant control of insects, rodents, nematodes, require administering the registry and for the purposes of Executive Order weeds, and pathogens for quarantine continuing research programs on 12866 and, therefore, has been reviewed and other purposes. Most methyl alternatives to the official quarantine by the Office of Management and bromide is used as a soil fumigant, with uses. Under this proposed rule, a Budget. significant quantities applied to soils for determination that a use should be For this rule, we have prepared an the production of crops in California authorized as an official quarantine use economic analysis. The economic and Florida, in particular. Methyl would require confirming that a registry analysis provides a cost-benefit analysis bromide is also applied in post-harvest candidate is an official quarantine as required by Executive Order 12866, treatments, both for quarantine purposes as well as an analysis of the potential and to meet sanitation standards, and as requirement or control of the requesting economic effects of this proposed rule a structural fumigant. Production and State, local, or tribal authority and that on small entities, as required under 5 consumption of methyl bromide by the no registered, effective, and U.S.C. 603. The economic analysis is United States is to be phased out in economically feasible alternative is summarized below. Copies of the full 2005, except for uses exempted under available. Requests for a determination analysis are available by contacting the the Montreal Protocol and Clean Air would have to identify the quarantine person listed under FOR FURTHER Act, including quarantine applications. need for the treatment or application INFORMATION CONTACT. Under sec. 419, a determination that and document the State, local, or tribal We do not have enough data for a a treatment or application should be regulation or mandatory procedures comprehensive analysis of the economic authorized as an official control or under which the methyl bromide effects of this proposed rule on small official requirement requires that USDA treatment or application is required. entities. Therefore, in accordance with 5 continue research on alternatives to This proposed rule contains various U.S.C. 603, we have performed an initial such uses. USDA, under Agricultural recordkeeping and reporting regulatory flexibility analysis for this Research Service leadership, is requirements. These requirements are proposed rule. We are inviting conducting research programs on described in this document under the comments about this proposed rule as it alternatives for many methyl bromide heading ‘‘Paperwork Reduction Act.’’ relates to small entities. In particular, uses. Section 419 may provide Executive Order 12372 we are interested in determining the additional focus for new research number and kind of small entities who initiatives on alternatives to methyl This program/activity is listed in the may incur benefits or costs from bromide used for quarantine purposes, Catalog of Federal Domestic Assistance implementation of this proposed rule and may bolster ongoing research under No. 10.025 and is subject to and the economic impact of those programs. State, local, or tribal Executive Order 12372, which requires benefits or costs. authorities may value federally intergovernmental consultation with This proposed rule would establish mandated efforts to develop registered, State and local officials. (See 7 CFR part procedures to implement an amendment effective and economically feasible 3015, subpart V.) to the PPA added as part of the Farm alternatives to quarantine uses of methyl Executive Order 12988 Security and Rural Investment Act of bromide. This interest could be 2002. The amendment, a new sec. 419, expected to strengthen as the cost of This proposed rule has been reviewed calls for the Secretary of Agriculture, methyl bromide use increases. Section under Executive Order 12988, Civil upon request of State, local, or tribal 419 may influence the allocation of Justice Reform. If this proposed rule is authorities, to determine whether research resources, to the extent that it adopted: (1) All State and local laws and methyl bromide treatments or provides specific statutory justification regulations that are inconsistent with applications required by those for research on alternatives to methyl this rule will be preempted; (2) no authorities to prevent the introduction, bromide used for quarantine purposes. retroactive effect will be given to this establishment, or spread of plant pests As a part of the rulemaking process, rule; and (3) administrative proceedings (including diseases) or noxious weeds APHIS evaluates whether proposed will not be required before parties may should be authorized as official controls regulations are likely to have a file suit in court challenging this rule.
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National Environmental Policy Act requests would need to include Celeste Sickles, APHIS’ Information An environmental assessment has information on the nature and location Collection Coordinator, at (301) 734– been prepared for this proposed rule. of the methyl bromide use under 7477. consideration and the plant pests or The environmental assessment List of Subjects in 7 CFR 304 documents our review of the noxious weeds that methyl bromide is environmental impacts associated with needed to control. Plant diseases and pests, Quarantine, this proposed rule. We are making the We are soliciting comments from the Reporting and recordkeeping environmental assessment available to public (as well as affected agencies) requirements. the public for review and comment. concerning our proposed information Accordingly, we are proposing to The environmental assessment was collection and recordkeeping amend 7 CFR chapter III by adding a prepared in accordance with: (1) The requirements. These comments will new part 304 to read as follows: National Environmental Policy Act of help us: (1) Evaluate whether the proposed 1969 (NEPA), as amended (42 U.S.C. PART 304—METHYL BROMIDE information collection is necessary for 4321 et seq.), (2) regulations of the the proper performance of our agency’s Sec. Council on Environmental Quality for functions, including whether the 304.1 Definitions. implementing the procedural provisions information will have practical utility; 304.2 Requests for determination; review of of NEPA (40 CFR parts 1500–1508), (3) determinations. (2) Evaluate the accuracy of our USDA regulations implementing NEPA 304.3 Submission of requests. estimate of the burden of the proposed (7 CFR part 1b), and (4) APHIS’ NEPA 304.4 Registry. information collection, including the Implementing Procedures (7 CFR part validity of the methodology and Authority: 7 U.S.C. 7719; 7 CFR 2.22, 280, 372). and 371.3. assumptions used; Copies of the environmental (3) Enhance the quality, utility, and § 304.1 Definitions. assessment are available for public clarity of the information to be Administrator. The Administrator of inspection in our reading room collected; and the Animal and Plant Health Inspection (information on the location and hours (4) Minimize the burden of the Service or any individual authorized to of the reading room is provided under information collection on those who are act for the Administrator. the heading ADDRESSES at the beginning to respond (such as through the use of of this document). In addition, copies appropriate automated, electronic, Animal and Plant Health Inspection may be obtained by writing to the mechanical, or other technological Service (APHIS). The Animal and Plant person listed under FOR FURTHER collection techniques or other forms of Health Inspection Service of the United INFORMATION CONTACT. The information technology; e.g., permitting States Department of Agriculture. environmental assessment is also electronic submission of responses). Control. Suppression, containment, or available on the Internet at http:// Estimate of burden: Public reporting eradication of a pest population. _ www.aphis.usda.gov/ppq/enviro docs/ burden for this collection of information Official quarantine use. A methyl mb.html. is estimated to average 0.5 hours per bromide treatment or application that the Administrator determines to be an Paperwork Reduction Act response. Respondents: State, local, and tribal official control or official requirement, In accordance with section 3507(d) of authorities. based on information that the treatment the Paperwork Reduction Act of 1995 Estimated annual number of or application is required by a State, (44 U.S.C. 3501 et seq.), the information respondents: 10. local, or tribal authority for either of the collection or recordkeeping Estimated annual number of following reasons: requirements included in this proposed responses per respondent: 1. (1) For the management of plant pests rule have been submitted for approval to Estimated annual number of or noxious weeds of potential the Office of Management and Budget responses: 10. importance to the area endangered (OMB). Please send written comments Estimated total annual burden on thereby and not yet present there, or to the Office of Information and respondents: 5 hours. (Due to averaging, present but not widely distributed; or Regulatory Affairs, OMB, Attention: the total annual burden hours may not (2) To meet official quarantine Desk Officer for APHIS, Washington, DC equal the product of the annual number requirements for the management of 20503. Please state that your comments of responses multiplied by the reporting economic plant pests in plant material refer to Docket No. 02–086–1. Please burden per response.) intended for propagation. send a copy of your comments to: (1) Copies of this information collection Requirement. A treatment or Docket No. 02–086–1, Regulatory can be obtained from Mrs. Celeste application to prevent the introduction, Analysis and Development, PPD, Sickles, APHIS’ Information Collection establishment or spread of pests. APHIS, Station 3C71, 4700 River Road Coordinator, at (301) 734–7477. State. Any of the several States of the Unit 118, Riverdale, MD 20737–1238, United States, the Commonwealth of the and (2) Clearance Officer, OCIO, USDA, Government Paperwork Elimination Act Compliance Northern Mariana Islands, the room 404–W, 14th Street and Commonwealth of Puerto Rico, the Independence Avenue, SW., The Animal and Plant Health District of Columbia, Guam, the Virgin Washington, DC 20250. A comment to Inspection Service is committed to Islands of the United States, or any OMB is best assured of having its full compliance with the Government other territory or possession of the effect if OMB receives it within 30 days Paperwork Elimination Act (GPEA), United States. of publication of this proposed rule. which requires government agencies in Under this proposed rule, State, local, general to provide the public the option § 304.2 Requests for determination; review or tribal authorities seeking of submitting information or transacting of determinations. determinations that methyl bromide business electronically to the maximum (a) A State, local, or tribal authority treatments or applications qualify as extent possible. For information may request that the Administrator official quarantine uses would have to pertinent to GPEA compliance related to determine whether a methyl bromide submit written requests to APHIS. These this proposed rule, please contact Mrs. treatment or application required by the
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State, local, or tribal authority should be permit. The Administrator’s decision, DEPARTMENT OF TRANSPORTATION authorized as an official quarantine use. and his or her reasons for that decision, (b) The Administrator will issue a will be communicated to the requestor Federal Aviation Administration determination not later than 90 days in writing. after the receipt of a request submitted 14 CFR Part 39 (e) Consistent with the Montreal in accordance with § 304.3. A methyl bromide treatment or application will be Protocol and under the authority of the [Docket No. 2002–NE–33–AD] Clean Air Act, the Administrator of the determined by the Administrator to be RIN 2120–AA64 an official quarantine use if the Environmental Protection Agency (EPA) treatment or application conforms to the shall exempt quarantine applications of Airworthiness Directives; Bombardier- definition of that term in § 304.1, and if methyl bromide. APHIS will consult Rotax GmbH Type 912 F, 912 S, and the Administrator finds that there is no with EPA as appropriate in the course 914 F Series Reciprocating Engines other registered, effective, and of evaluating requests to determine economically feasible alternative whether methyl bromide uses should be AGENCY: Federal Aviation available. If the Administrator authorized as official quarantine uses Administration (FAA), DOT. determines that a methyl bromide and whether and when a previously ACTION: Notice of proposed rulemaking treatment or application should not be authorized official quarantine use may (NPRM). authorized as an official quarantine use, be removed from the registry. the Administrator will provide to the SUMMARY: The FAA proposes to requestor, in writing, the reasons for his § 304.3 Submission of requests. supersede an existing airworthiness directive (AD) for Bombardier-Rotax or her determination. (a) A request for a determination GmbH Type 912 F, 912 S, and 914 F (c) If a registered alternative to methyl under § 304.2 must be submitted and series reciprocating engines. That AD bromide becomes available for a signed by the executive official or a treatment or application that the currently requires venting of the plant protection official of the State, lubrication system and inspection of the Administrator has determined to be an local, or tribal authority seeking the official quarantine use, the valve train on all engines. That AD also determination, and must include the requires venting of the lubrication Administrator will initiate a review to following: consider the effectiveness and economic system of all engines on which the feasibility of the alternative. The State, (1) A copy of the State, local, or tribal lubrication system has been opened, local, or tribal authority that requested regulation or mandatory quarantine and any engine on which the propeller and received the determination that the procedures under which the methyl has been rotated one full turn in the methyl bromide treatment or bromide treatment or application is wrong direction. This proposed AD application under review was an official required; would require similar actions, and also quarantine use will be invited to (2) The name of the crop/use for require removing the existing part participate in the review. If the which the methyl bromide treatment or number oil dipstick from service and Administrator finds that the registered application is required; installing a new oil dipstick. This alternative is effective and economically proposed AD results from the need to feasible, the Administrator will rescind (3) The name(s) of the plant pests or clarify the mandated procedures for the determination that the methyl noxious weeds targeted for control with inspections and venting. This proposed bromide treatment or application is an methyl bromide; and AD also results from the manufacturer official quarantine use. (4) The location(s) where the methyl discovering that under certain (d) If the Administrator determines bromide treatment or application is circumstances, the oil level in the oil that a methyl bromide treatment or being carried out. tank can fall below the minimum level application should not be authorized as (b) All requests must be submitted to required to sustain proper engine an official quarantine use (see paragraph [address to be added in final rule]. lubrication. We are proposing this AD to (b) of this section) or that a prevent damage to the engine valve train determination should be rescinded (see § 304.4 Registry. due to inadequate venting of the paragraph (c) of this section), the lubrication system, which can result in affected State, local, or tribal authority All State, local, and tribal an in-flight engine failure and forced may request that the Administrator requirements for methyl bromide landing. reconsider his or her determination. applications or treatments that are DATES: We must receive any comments Requests for reconsideration may be determined by the Administrator to be on this proposed AD by October 12, submitted to the address provided in official quarantine uses will appear on 2004. § 304.3(b). In its request for a registry of such treatments or reconsideration, the State, local, or applications that will be published and ADDRESSES: Use one of the following tribal authority must provide, in maintained by the Administrator. A addresses to submit comments on this writing, the facts and reasons upon copy of the registry may be obtained by proposed AD: which it is relying to show that the writing to [address to be added in final • By mail: Federal Aviation treatment or application should be rule]. The registry may also be viewed Administration (FAA), New England determined to be an official quarantine on the Internet at http:// Region, Office of the Regional Counsel, use or that a determination should www.aphis.usda.gov/ppq/bromide/. Attention: Rules Docket No. 2002–NE– remain in effect. The Administrator will 33–AD, 12 New England Executive Park, Done in Washington, DC, this 9th day of take into account the information Burlington, MA 01803–5299. August 2004. provided in the request for • By fax: (781) 238–7055. reconsideration and any other relevant Bill Hawks, • By e-mail: 9-ane- facts, including the information Under Secretary for Marketing and Regulatory [email protected]. provided in the original request for Programs. You can get the service information determination, and will render a [FR Doc. 04–18445 Filed 8–11–04; 8:45 am] identified in this proposed AD from decision as promptly as circumstances BILLING CODE 3410–34–P Bombardier-Rotax GmbH, Gunskirchen,
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Austria; telephone 7246–601–423; fax after initial installation of a new or closely match the related Austro Control 7246–601–760. overhauled engine, after opening the oil AD. You may examine the AD docket at system, after an engine oil change, and Relevant Service Information the FAA, New England Region, Office of after the propeller was rotated one full the Regional Counsel, 12 New England turn in the wrong direction of rotation, We have reviewed and approved the Executive Park, Burlington, MA. allowing air to be ingested into the valve technical contents of Bombardier-Rotax FOR FURTHER INFORMATION CONTACT: train components. GmbH Mandatory Service Bulletin Richard Woldan, Aerospace Engineer, Austro Control, which is the (MSB) No. SB–912–036/SB–914–022, Engine Certification Office, FAA, Engine airworthiness authority for Austria, Revision 1, dated August 2002. This and Propeller Directorate, 12 New notified us that an unsafe condition may MSB provides procedures for inspecting England Executive Park; telephone (781) exist on Bombardier-Rotax GmbH 912 F, engines for correct venting of the oil 238–7136; fax (781) 238–7199. 912 S, and 914 F series reciprocating system and procedures for inspecting SUPPLEMENTARY INFORMATION: engines. Austro Control advised that the valve train for damage caused by inadequate venting. Austro Control has Comments Invited there have been seven in-flight engine failures that occurred within 50 hours classified this service bulletin as We invite you to submit any written time-in-service (TIS) after installation of mandatory and issued AD No.113R1 in relevant data, views, or arguments a new or overhauled engine. order to assure the airworthiness of regarding this proposal. Send your Investigations by Austro Control these Bombardier-Rotax GmbH engines comments to an address listed under indicate that the failures were due to in Austria. ADDRESSES. Include ‘‘AD Docket No. inadequate venting of the lubrication Differences Between the Proposed AD 2002–NE–33–AD’’ in the subject line of systems. Inadequate venting of the and the Service Information your comments. If you want us to lubrication system can cause damage to Bombardier-Rotax GmbH MSB SB– acknowledge receipt of your mailed the engine valve train as a result of comments, send us a self-addressed, 912–036/SB–914–022 allows up to 5 compression of trapped air while at hours TIS before venting and inspecting stamped postcard with the docket maximum camshaft speed resulting in number written on it; we will date- for correct venting of the oil system on high impact stresses to valve train engines with 50 hours or less TIS since stamp your postcard and mail it back to components. you. We specifically invite comments the lubrication system has been opened on the overall regulatory, economic, Actions After AD 2002–21–16 Was and drained, since an oil change was environmental, and energy aspects of Issued performed using improper procedures, or since the propeller was rotated more the proposed AD. If a person contacts us After AD 2002–21–16 was issued, than one turn in the wrong direction of verbally, and that contact relates to a Austro Control advised that there have rotation. We have determined that the substantive part of this proposed AD, been 11 in-flight engine failures due to venting and inspecting of the valve train we will summarize the contact and an oil tank level that is too low causing must be done before the next engine place the summary in the docket. We induction of air into the oil system and start. will consider all comments received by higher than anticipated pressures the closing date and may amend the through the valve push rods. Bilateral Agreement Information proposed AD in light of those Investigations by Austro Control comments. This engine model is manufactured in indicate that the failures were due to Austria and is type certificated for We are reviewing the writing style we slower than anticipated return of oil currently use in regulatory documents. operation in the United States under the from the engine crankcase back to the provisions of Section 21.29 of the We are interested in your comments on oil tank. Changes to the viscous whether the style of this document is Federal Aviation Regulations (14 CFR properties of the oil cause a slower 21.29) and the applicable bilateral clear, and your suggestions to improve return of oil to the oil tank. This slow the clarity of our communications that airworthiness agreement. In keeping return results in the oil level in the oil with this bilateral airworthiness affect you. You may get more tank falling below the minimum level information about plain language at agreement, Austro Control has kept us required. An oil level that is too low informed of the situation described http://www.faa.gov/language and http:// causes induction of air into the oil www.plainlanguage.gov. above. We have examined the findings system and higher than anticipated of Austro Control, reviewed all available Examining the AD Docket pressures through the valve push rods. information, and determined that AD You may examine the AD Docket That higher pressure causes damage to action is necessary for products of this (including any comments and service the components of the engine valve type design that are certificated for information), by appointment, between train. To help prevent this condition, operation in the United States. 8 a.m. and 4:30 p.m., Monday through Rotax introduced a new engine oil dipstick that has higher level indicator FAA’s Determination and Requirements Friday, except Federal holidays. See of the Proposed AD ADDRESSES for the location. marks, which requires a greater quantity of oil in the oil tank. This increased We have evaluated all pertinent Discussion quantity of oil helps prevent the information and identified an unsafe On October 17, 2002, we issued AD induction of air into the oil system. condition that is likely to exist or 2002–21–16, Amendment 39–12923 (67 Also, after AD 2002–21–16 was develop on other products of this same FR 65033, October 23, 2002). That AD issued, we found that some corrections type design. Therefore, we are requires: and clarifications are required. In the proposing this AD, which would • Before further flight, inspecting the ADDRESSES paragraph, this proposal require: engine valve train, venting the corrects the address and telephone • Before the next engine start for lubrication system, and inspecting for numbers for the Rotax service engines with 50 hours or less TIS on the the correct venting of the oil system. information. Also, this proposal revises effective date of the AD, since the • Thereafter, before engine start, the compliance section for clarification engine had the oil system opened, or the properly venting the lubrication system of the inspections and venting to more oil was changed using other than
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specified procedures, or the propeller under the criteria of the Regulatory Compliance was rotated more than one turn in the Flexibility Act. (e) You are responsible for having the wrong direction of rotation, inspecting We prepared a summary of the costs actions required by this AD performed within for valve train damage, properly venting to comply with this proposal and placed the compliance times specified unless the the lubrication system and inspecting it in the AD Docket. You may get a copy actions have already been done. for the correct venting of the hydraulic of this summary by sending a request to Initial Venting and Inspection for Correct valve tappets. us at the address listed under Venting • Thereafter, for all engines, before ADDRESSES. Include ‘‘AD Docket No. (f) Before the next engine start, for all engine start, properly venting the 2002–NE–33–AD’’ in your request. Bombardier-Rotax GmbH 912 F, 912 S, and lubrication system after initial List of Subjects in 14 CFR Part 39 914 F series reciprocating engines that have installation of a new or overhauled not been operated since doing any of the engine, after opening the oil system, Air transportation, Aircraft, Aviation actions identified in Section 1.5 (a) of Rotax after changing the oil using improper safety, Safety. Mandatory Service Bulletin (MSB) SB–912– 036/SB–914–022, Revision 1, dated August procedures, or after the propeller was The Proposed Amendment rotated more than one turn in the wrong 2002, do the following: (1) Perform venting of the lubrication direction of rotation, allowing air to be Accordingly, under the authority delegated to me by the Administrator, system; and ingested into the valve train (2) Perform inspection for correct venting components. the Federal Aviation Administration • of the hydraulic valve tappets. Use Section At the next oil change, or within proposes to amend 14 CFR part 39 as 3.1.1 through Section 3.1.4 of the 100 hours TIS after the effective date of follows: Accomplishment Instructions of Rotax MSB the AD, whichever is later, removing the SB–912–036/SB–914–022, Revision 1, dated oil dipstick, part number (P/N) 956150, PART 39—AIRWORTHINESS August 2002 to do the venting and from service, and installing a DIRECTIVES inspection. serviceable dipstick that has a different 1. The authority citation for part 39 Inspection of Engine Valve Train P/N. continues to read as follows: (g) Before the next engine start, for all The proposed AD would require that Authority: 49 U.S.C. 106(g), 40113, 44701. Bombardier-Rotax GmbH 912 F, 912 S, and you do the venting of the lubrication 914 F series reciprocating engines that have system using the service information § 39.13 [Amended] been operated for 50 hours or less on the described previously. 2. The Federal Aviation effective date of this AD since doing any of the actions identified in Section 1.5 (b) of Costs of Compliance Administration (FAA) amends § 39.13 by removing Amendment 39–12923 (67 Rotax Mandatory Service bulletin (MSB) SB– There are about 624 Bombardier- 912–036/SB–914–022, Revision 1, dated FR 65033, October 23, 2002) and by August 2002, do the following: Rotax GmbH Type 912 F, 912 S, and 914 adding a new airworthiness directive, to F series reciprocating engines of the (1) Disassemble and perform inspection of read as follows: the engine valve train; and affected design in the worldwide fleet. (2) Reassemble, vent the lubrication We estimate that 282 engines installed Bombardier-Rotax GmbH: Docket No. 2002– NE–33–AD. Supersedes AD 2002–21–16, system, and inspect for correct venting of the on aircraft of U.S. registry would be Amendment 39–12923. hydraulic valve tappets. Use Section 3.1.5 affected by this proposed AD. We also through Section 3.1.7 of the Accomplishment estimate that it would take about one Comments Due Date Instructions of Rotax MSB SB–912–036/SB– work hour per engine to perform one oil (a) The FAA must receive comments on 914–022, Revision 1, dated August 2002. system inspection and venting, and that this airworthiness directive (AD) action by Repetitive Venting of the Lubrication System the average labor rate is $65 per work October 12, 2004. (h) Thereafter, for all Bombardier-Rotax hour. Required parts would cost about Affected ADs GmbH 912 F, 912 S, and 914 F series $0.85 per engine. Based on these figures, (b) This AD supersedes AD 2002–21–16, reciprocating engines, after doing any of the we estimate the total cost of the Amendment 39–12923. actions in the following paragraphs (h)(1) proposed AD to U.S. operators to be through (h)(4), vent the lubrication system $18,570. Applicability and inspect for correct venting of the (c) This AD applies to Bombardier-Rotax hydraulic valve tappets before starting the Regulatory Findings GmbH 912 F, 912 S, and 914 F series engine. Use Section 3.1.1 through Section We have determined that this reciprocating engines. These engines are 3.1.4 of the Accomplishment Instructions of proposed AD would not have federalism installed on, but not limited to, Diamond Rotax MSB SB–912–036/SB–914–022, implications under Executive Order Aircraft Industries, DA20–A1, Diamond Revision 1, dated August 2002 to do the 13132. This proposed AD would not Aircraft Industries GmbH Model HK 36 TTS, venting and inspecting. Model HK 36TTC, and Model HK 36 TTC– (1) The installation of a new or overhauled have a substantial direct effect on the ECO, Iniziative Industriali Italiane S.p.A. Sky engine. States, on the relationship between the Arrow 650 TC and Sky Arrow 650 TCN, (2) The oil system has been opened national Government and the States, or Aeromot-Industria Mecanico Metalurgica allowing air to enter the valve train (e.g. oil on the distribution of power and ltda., Models AMT–300 and AMT–200S, and pump, oil cooler, oil suction line removed responsibilities among the various Stemme S10–VT aircraft. which allows oil to drain from the engine oil galleries). levels of government. Unsafe Condition For the reasons discussed above, I (3) The engine oil was changed using certify that the proposed regulation: (d) This AD results from the manufacturer procedures other than those included in 1. Is not a ‘‘significant regulatory discovering that under certain circumstances, Section 1.2 of Rotax MSB SB–912–036/SB– action’’ under Executive Order 12866; the oil level in the oil tank can fall below the 914–022 Revision 1, dated August 2002. minimum level required to sustain proper 2. Is not a ‘‘significant rule’’ under the (4) The propeller was turned more than engine lubrication. The actions specified in one turn in the wrong direction of rotation. DOT Regulatory Policies and Procedures this AD are intended to prevent damage to (44 FR 11034, February 26, 1979); and the engine valve train due to inadequate Removal of Existing Oil Dipstick From 3. Would not have a significant venting of the lubrication system, which can Service economic impact, positive or negative, result in an in-flight engine failure and forced (i) At the next oil change or within 100 on a substantial number of small entities landing. hours TIS after the effective date of this AD,
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whichever is later, remove the oil dipstick, regulations concerning when a partner the application of automated collection part number (P/N) 956150, from service, and may be treated as bearing the economic techniques or other forms of information install a dipstick that has a different P/N. risk of loss for a partnership liability technology; and Information on removing oil dipstick P/N based upon an obligation of a Estimates of capital or start-up costs 956150 from service can be found in Rotax Service Bulletin SB–912–040/SB–914–026, disregarded entity. and costs of operation, maintenance, Revision 1, dated August 2003. DATES: Written or electronic comments and purchase of service to provide and requests for a public hearing must information. Prohibition of Oil Dipstick, P/N 956150 be received by November 10, 2004. The collection of information in this (j) After the effective date of this AD, do proposed regulation is in § 1.752–2(k). ADDRESSES: Send submissions to: not use dipstick P/N 956150 after complying This information is required to ensure with paragraph (i) of this AD. CC:PA:LPD:PR (REG–128767–04), room 5203, Internal Revenue Service, POB proper allocations of partnership Alternative Methods of Compliance 7604, Ben Franklin Station, Washington, liabilities. This information will be used (k) The Manager, Engine Certification DC 20044. Submissions may also be to determine the extent to which certain Office, has the authority to approve hand delivered Monday through Friday partners or related persons bear the alternative methods of compliance for this between the hours of 8 a.m. and 4 p.m. economic risk of loss with respect to AD if requested using the procedures found to: CC:PA:LPD:PR (REG–128767–04), partnership liabilities. The collection of in 14 CFR 39.19. Courier’s Desk, Internal Revenue information is mandatory. The likely Special Flight Permits Service, 1111 Constitution Avenue, reporters are individuals and small NW., Washington, DC, or sent businesses or organizations. (l) Special flight permits are not permitted. Estimated total annual reporting electronically, via the IRS Internet site Material Incorporated by Reference burden: 500 hours. at: http://www.irs.gov/regs, or via the (m) None. The estimated annual burden per Federal eRulemaking Portal at: http:// respondent varies from 6 minutes to 2 Related Information www.regulations.gov (IRS-REG–128767– hours, depending on individual (n) Austro Control airworthiness directives 04). circumstances, with an estimated No. 113R1, dated August 30, 2002, and No. FOR FURTHER INFORMATION CONTACT: average of 1 hour. 116, dated September 15, 2003, Rotax Service Concerning the regulations, Michael J. Estimated number of respondents: Bulletin SB–912–040/SB–914–026, Revision Goldman, (202) 622–3070; concerning 500. 1, dated August 2003, and Rotax Service submissions of the comments and the Estimated frequency of responses: On Instruction SI–04–1997, Revision 3, dated public hearing, Robin Jones, (202) 622– September 2002 also address the subject of occasion. this AD. 3521 (not toll-free numbers). An agency may not conduct or SUPPLEMENTARY INFORMATION: sponsor, and a person is not required to Issued in Burlington, Massachusetts, on respond to, a collection of information August 6, 2004. Paperwork Reduction Act unless it displays a valid control Jay J. Pardee, The collection of information number assigned by the Office of Manager, Engine and Propeller Directorate, contained in this notice of proposed Management and Budget. Aircraft Certification Service. rulemaking has been submitted to the Books or records relating to a [FR Doc. 04–18440 Filed 8–11–04; 8:45 am] Office of Management and Budget for collection of information must be BILLING CODE 4910–13–P review in accordance with the retained as long as their contents may Paperwork Reduction Act of 1995 (44 become material in the administration U.S.C. 3507(d)). Comments on the of any internal revenue law. Generally, DEPARTMENT OF THE TREASURY collection of information should be sent tax returns and tax return information to the Office of Management and are confidential, as required by 26 Internal Revenue Service Budget, Attn: Desk Officer for the U.S.C. 6103. Department of the Treasury, Office of Background 26 CFR Part 1 Information and Regulatory Affairs, [REG–128767–04] Washington, DC 20503, with copies to Under section 752, a partner’s basis in the Internal Revenue Service, Attn: IRS its partnership interest includes the RIN 1545–BD48 Reports Clearance Officer, partner’s share of partnership liabilities. SE:W:CAR:MP:T:T:SP; Washington, DC The Income Tax Regulations under Treatment of Disregarded Entities 20224. Comments on the collection of section 752 provide rules relating to the Under Section 752 information should be received by determination of a partner’s share of AGENCY: Internal Revenue Service (IRS), October 12, 2004. Comments are partnership liabilities. Those rules differ Treasury. specifically requested concerning: depending upon whether the liability is ACTION: Notice of proposed rulemaking. Whether the proposed collection of characterized as recourse or information is necessary for the proper nonrecourse for purposes of section 752. SUMMARY: The proposed regulations performance of the functions of the Section 1.752–1(a) provides that a provide rules under section 752 for Internal Revenue Service, including partnership liability is a recourse taking into account certain obligations whether the information will have liability to the extent that any partner or of a business entity that is disregarded practical utility; related person bears the economic risk as separate from its owner under The accuracy of the estimated burden of loss for that liability under § 1.752– sections 856(i), 1361(b)(3), or associated with the proposed collection 2. Section 1.752–1(a) also provides that §§ 301.7701–1 through 301.7701–3 of information (see below); a partnership liability is a nonrecourse (disregarded entity) for purposes of How the quality, utility, and clarity of liability to the extent that no partner or characterizing and allocating the information to be collected may be related person bears the economic risk partnership liabilities. The rules affect enhanced; of loss for that liability under § 1.752– partnerships with partnership debt and How the burden of complying with 2. partners in those partnerships. These the proposed collection of information In general, a partner bears the proposed regulations clarify the existing may be minimized, including through economic risk of loss for a partnership
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liability under § 1.752–2 to the extent extent of the net value of the the entity if the subsequent reduction is that the partner or a related person (as disregarded entity’s assets. anticipated and is part of a plan that has defined in § 1.752–4(b)) has an as one of its principal purposes creating Explanation of Provisions obligation to make a payment to any the appearance that a partner bears the person, including a contribution to the The proposed regulations provide that economic risk of loss for a partnership partnership, that is recognized under in determining the extent to which a liability. In addition, under the § 1.752–2(b)(3) on account of the partner bears the economic risk of loss proposed regulations, if one or more partnership liability if the partnership for a partnership liability, payment disregarded entities have payment were to constructively liquidate as obligations of a disregarded entity are obligations with respect to one or more described in § 1.752–2(b) (payment taken into account for purposes of partnership liabilities, or liabilities of obligation). As provided in § 1.752– section 752 only to the extent of the net more than one partnership, the 2(b)(3) and (5), all statutory and value of the disregarded entity as of the partnership must allocate the net value contractual obligations relating to the date on which the partnership of each disregarded entity among partnership liability and reimbursement determines the partner’s share of partnership liabilities in a reasonable rights are taken into account in partnership liabilities pursuant to and consistent manner, taking into determining whether a partner or §§ 1.752–4(d) and 1.705–1(a). However, account priorities among partnership related person has a payment obligation the proposed regulations do not apply to liabilities. under § 1.752–2(b). Moreover, for an obligation of a disregarded entity to To facilitate the partnership’s purposes of determining the extent to the extent that the owner of the determination of the net value of a which a partner or related person has a disregarded entity otherwise is required disregarded entity, the proposed payment obligation and the economic to make a payment (that satisfies the regulations provide that a partner that risk of loss for a partnership liability, requirements of § 1.752–2(b)(1)) with may be treated as bearing the economic § 1.752–2(b)(6) provides that it is respect to such obligation of the risk of loss for a partnership liability presumed that all partners and related disregarded entity. based upon a payment obligation of a Under the proposed regulations, the persons who have obligations to make disregarded entity must provide net value of a disregarded entity equals payments actually perform those information as to the entity’s tax the fair market value of all assets owned obligations, irrespective of their actual classification and net value to the by the disregarded entity that may be net worth (presumption of deemed partnership on a timely basis. subject to creditors’ claims under local satisfaction), unless the facts and The IRS and Treasury Department are law, including the disregarded entity’s circumstances indicate a plan to considering and request comments enforceable rights to contributions from circumvent or avoid the obligation. regarding whether the rules of the its owner but excluding the disregarded proposed regulations should be These proposed regulations clarify the entity’s interest in the partnership (if extended to the payment obligations of existing regulations concerning when a any) and the fair market value of other entities, such as entities that are partner may be treated as bearing the property pledged to secure a partnership capitalized with nominal equity. economic risk of loss for a partnership liability (which is already taken into The proposed regulations also include liability based upon a payment account under § 1.752–2(h)(1)), less conforming changes to § 1.704–2(f)(2), obligation of a business entity that is obligations of the disregarded entity that (g)(3) and (i)(4). Section 1.704–2 disregarded as separate from its owner do not constitute, and are senior or of includes rules that apply when the under sections 856(i), 1361(b)(3), or equal priority to, payment obligations of character of partnership debt under §§ 301.7701–1 through 301.7701–3 of the disregarded entity. After the net section 752 changes as a result of a this chapter (disregarded entity). value of a disregarded entity is initially guarantee, lapse of a guarantee, Because a disregarded entity and its determined under the rules of the conversion, refinancing or other change owner are treated as a single entity, the proposed regulations, the net value of in the debt instrument. Under the presumption of deemed satisfaction of the disregarded entity is not proposed regulations, those rules would obligations undertaken by the owner redetermined unless the obligations of apply upon any change in the character arguably should include payment the disregarded entity that do not of partnership debt under section 752, obligations undertaken by the constitute, and are senior or of equal whether as a result of the circumstances disregarded entity. However, because of priority to, payment obligations of the specified in the current regulations or as statutory limitations on liability, the disregarded entity change by more than a result of changes under the rules of the owner of a disregarded entity may have a de minimis amount or there is more proposed regulations. no obligation to satisfy payment than a de minimis contribution to or Finally, the proposed regulations obligations undertaken by the distribution from the disregarded entity. clarify that the pledge rules of the disregarded entity. The current The IRS and Treasury Department regulations under § 1.752–2(h) refer to regulations consider such limitations on request comments on whether other the net fair market value of property the payment obligations of a partner or events (such as a sale of substantially all pledged to secure a partnership liability. related person to be relevant in of a disregarded entity’s assets) should The IRS and Treasury Department are determining the extent to which the be specified as revaluation events and considering and request comments partner or related person is treated as whether a partner should be able to regarding whether partners should be bearing the economic risk of loss for a make an election to revalue a able to make an election, revocable only partnership liability. The IRS and disregarded entity annually regardless with the Commissioner’s consent, to Treasury Department believe that of the occurrence of a revaluation event. revalue pledged assets annually. because only the assets of a disregarded An election to revalue annually would entity may be available to satisfy be revocable only with the Proposed Effective Date payment obligations undertaken by the Commissioner’s consent. The regulations are proposed to apply disregarded entity, a partner should be The proposed regulations also provide to liabilities incurred or assumed by a treated as bearing the economic risk of that the net value of a disregarded entity partnership on or after the date the loss for a partnership liability as a result is determined by taking into account a regulations are published as final of those payment obligations only to the subsequent reduction in the net value of regulations in the Federal Register,
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other than liabilities incurred or Proposed Amendments to the to that date. Otherwise, the rules assumed by a partnership pursuant to a Regulations applicable to liabilities incurred or written binding contract in effect prior Accordingly, 26 CFR part 1 is assumed (or subject to a binding to that date. proposed to be amended as follows: contract in effect) prior to the date the regulations are published as final Special Analyses PART 1—INCOME TAXES regulations in the Federal Register are It has been determined that this notice contained in § 1.704–2 in effect prior to of proposed rulemaking is not a Paragraph 1. The authority citation the date the regulations are published as significant regulatory action as defined for part 1 continues to read, in part, as final regulations in the Federal Register in Executive Order 12866. Therefore, a follows: (see 26 CFR part 1 revised as of April regulatory assessment is not required. It Authority: 26 U.S.C. 7805 * * * 1, 2004). also has been determined that section Par. 2. Section 1.704–2 is amended as * * * * * 553(b) of the Administrative Procedure follows: Par. 3. Section 1.752–2 is amended as Act (5 U.S.C. chapter 5) does not apply 1. Paragraph (f)(2) is revised. follows: to these regulations. It is hereby 2. The first sentence of paragraph 1. Paragraph (a) is revised. certified that the collection of (g)(3) is revised. 2. The last sentence of paragraph information in these regulations will not 3. The third sentence of paragraph (b)(6) is revised. have a significant economic impact on (i)(4) is revised. 3. Paragraph (h)(3) is revised. a substantial number of small entities. 4. Paragraph (l)(1)(iv) is added. 4. Paragraphs (k) and (l) are added. This certification is based on the fact The revisions and addition read as The revisions and additions read as that the amount of time necessary to follows: follows: report the required information will be minimal. Accordingly, a Regulatory § 1.704–2 Allocations attributable to § 1.752–2 Partner’s share of recourse Flexibility Analysis under the nonrecourse liabilities. liabilities. Regulatory Flexibility Act (5 U.S.C. * * * * * (a) In general. A partner’s share of a chapter 6) does not apply. Pursuant to (f) * * * recourse partnership liability equals the section 7805(f) of the Internal Revenue (2) Exception for certain conversions portion of that liability, if any, for which Code, this notice of proposed and refinancings. A partner is not the partner or related person bears the rulemaking will be submitted to the subject to the minimum gain chargeback economic risk of loss. The Chief Counsel for Advocacy of the Small requirement to the extent the partner’s determination of the extent to which a Business Administration for comment share of the net decrease in partnership partner bears the economic risk of loss on its impact on small business. minimum gain is caused by a for a partnership liability is made under recharacterization of nonrecourse the rules in paragraphs (b) through (k) Comments and Requests for a Public partnership debt as partially or wholly of this section. Hearing recourse debt or partner nonrecourse (b) * * * Before these proposed regulations are debt, and the partner bears the (6) * * * See paragraphs (j) and (k) of adopted as final regulations, economic risk of loss (within the this section. consideration will be given to any meaning of § 1.752–2) for the liability. * * * * * written (a signed original and 8 copies) * * * * * (h) * * * or electronic comments that are (g) * * * (3) Valuation. The extent to which a submitted timely to the IRS. The IRS (3) Conversions of recourse or partner partner bears the economic risk of loss and Treasury Department request nonrecourse debt into nonrecourse debt. for a partnership liability as a result of comments on the clarity of the proposed A partner’s share of minimum gain is a direct pledge described in paragraph rules, how they can be made easier to increased to the extent provided in this (h)(1) of this section or an indirect understand and the administrability of paragraph (g)(3) if a recourse or partner pledge described in paragraph (h)(2) of the rules in the proposed regulations. nonrecourse liability becomes partially this section is limited to the net fair All comments will be available for or wholly nonrecourse. * * * market value of the property at the time public inspection and copying. A public * * * * * of the pledge or contribution. For hearing may be scheduled if requested (i) * * * purposes of this paragraph, if property in writing by any person who timely (4) * * * A partner is not subject to is subject to one or more other submits written comments. If a public this minimum gain chargeback, obligations that are senior or of equal hearing is scheduled, notice of the date, however, to the extent the net decrease priority to the partnership liability, time, and place of the public hearing in partner nonrecourse debt minimum those obligations must be taken into will be published in the Federal gain arises because a partner account in determining the net fair Register. nonrecourse liability becomes partially market value of pledged property. or wholly a nonrecourse liability. * * * Drafting Information * * * * * * * * * * (k) Effect of a disregarded entity—(1) The principal author of these (l) * * * (1) * * * In general. In determining the extent to proposed regulations is Michael J. (iv) Paragraph (f)(2), the first sentence which a partner bears the economic risk Goldman of the Office of Associate of paragraph (g)(3), and the third of loss for a partnership liability, Chief Counsel (Passthroughs and sentence of paragraph (i)(4) of this obligations of a business entity that is Special Industries). Other personnel section apply to liabilities incurred or disregarded as an entity separate from from the Treasury Department and the assumed by a partnership on or after the its owner under sections 856(i) or IRS participated in their development. date the regulations are published as 1361(b)(3) or §§ 301.7701–1 through List of Subjects in 26 CFR Part 1 final regulations in the Federal Register, 301.7701–3 of this chapter (disregarded other than liabilities incurred or entity), that may be taken into account Income taxes, Reporting and assumed by a partnership pursuant to a under paragraph (b)(1) of this section, recordkeeping requirements. written binding contract in effect prior are taken into account only to the extent
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of the net value of the disregarded entity partnership liabilities, or liabilities of only interest on its $300,000 debt during (as determined under paragraph (k)(2) of more than one partnership, the 2007. Under §§ 1.752–4(d) and 1.705–1(a), LP this section) as of the date on which the partnership must allocate the net value again determines its partners’ shares of the partnership determines the partner’s of each disregarded entity among $300,000 debt at the end of its taxable year, December 31, 2007. As of that date, LLC share of partnership liabilities pursuant partnership liabilities in a reasonable holds its interest in LP and the land, the to §§ 1.752–4(d) and 1.705–1(a) that is and consistent manner, taking into value of which has declined to $175,000. allocated to the liability under account priorities among partnership (ii) A’s contribution of $250,000 to LLC on paragraph (k)(4) of this section. The liabilities. January 1, 2007, constitutes a more than de rules of this paragraph (k) do not apply (5) Information to be provided by the minimis contribution of property to LLC. to an obligation of a disregarded entity owner of a disregarded entity. A partner Accordingly, under paragraph (k)(2) of this to the extent that the owner of the that may be treated as bearing the section, LLC’s value is redetermined on disregarded entity otherwise is required economic risk of loss for a partnership December 31, 2007, when LP determines its to make a payment (that satisfies the partners’ shares of its $300,000 debt. As of liability based upon an obligation of a that date, LLC’s net value is $175,000. requirements of paragraph (b)(1) of this disregarded entity that may be taken in Therefore, under paragraph (k) of this section) with respect to such obligation account under paragraph (b)(1) of this section, A is treated as bearing the economic of the disregarded entity. section must provide information as to risk of loss for $175,000 of LP’s $300,000 (2) Net value of a disregarded entity. the entity’s tax classification and net debt. As a result, $175,000 of LP’s $300,000 For purposes of paragraph (k)(1) of this value to the partnership on a timely debt is recharacterized as recourse under section, the net value of a disregarded basis. § 1.752–1(a) and is allocated to A under this entity equals the fair market value of all (6) The following examples illustrate section, and the remaining $125,000 of LP’s $300,000 debt remains characterized as assets owned by the entity that may be the rules of this paragraph (k): subject to creditors’ claims under local nonrecourse under § 1.752–1(a) and is law, including the entity’s enforceable Example 1. Disregarded entity with net allocated as required by § 1.752–3. value of zero. (i) In 2005, A forms a wholly Example 3. Allocation of net value among rights to contributions from its owner owned domestic limited liability company, partnership liabilities. (i) The facts are the but excluding the entity’s interest in the LLC, with a contribution of $100,000. A has same as in Example 2 except that on January partnership (if any) and the fair market no liability for LLC’s debts, and LLC has no 1, 2008, A forms another wholly owned value of property pledged to secure a enforceable right to contribution from A. A domestic limited liability company, LLC2, partnership liability under paragraph files no election with respect to LLC under with a contribution of $120,000. Shortly (h)(1) of this section, less obligations of § 301.7701–3 of this chapter. Also in 2005, thereafter, LLC2 uses the $120,000 to the disregarded entity that do not LLC contributes $100,000 to LP, a limited purchase stock in X corporation. A has no constitute, and are senior or of equal partnership with a calendar year taxable year, liability for LLC2’s debts, and LLC2 has no priority to, obligations of the in exchange for a general partnership interest enforceable right to contribution from A. A disregarded entity that may be taken in LP, and B and C each contributes $100,000 files no election with respect to LLC2 under to LP in exchange for a limited partnership § 301.7701–3 of this chapter. On July 1, 2008, into account under paragraph (b)(1) of interest in LP. The partnership agreement LP borrows $100,000 from a bank and uses this section. After the net value of a provides that only LLC is required to make the $100,000 to purchase nondepreciable disregarded entity is initially up any deficit in its capital account. On property. The $100,000 debt is secured by the determined for purposes of paragraph January 1, 2006, LP borrows $300,000 from property and is also a general obligation of (k)(1) of this section, the net value of the a bank and uses $600,000 to purchase LP. The $100,000 debt is senior in priority to disregarded entity is not redetermined nondepreciable property. The $300,000 debt LP’s existing $300,000 debt. Also on July 1, unless the obligations of the disregarded is secured by the property and is also a 2008, LLC2 agrees to guarantee both LP’s entity that are described in the general obligation of LP. LP makes payments $100,000 and $300,000 debts. LP makes preceding sentence change by more than of only interest on its $300,000 debt during payments of only interest on both its a de minimis amount or there is more 2006. Under §§ 1.752–4(d) and 1.705–1(a), LP $100,000 and $300,000 debts during 2008. determines its partners’ shares of the Under §§ 1.752–4(d) and 1.705–1(a), LP than a de minimis contribution to or $300,000 debt at the end of its taxable year, determines its partners’ shares of its $100,000 distribution from the disregarded entity December 31, 2006. As of that date, LLC and $300,000 debts at the end of its taxable of property other than property pledged holds no assets other than its interest in LP. year, December 31, 2008. As of that date, LLC to secure a partnership liability under (ii) Under § 301.7701–3(b)(1)(ii) of this holds its interest in LP and the land, and paragraph (h)(1) of this section. chapter, LLC is a disregarded entity. Because LLC2 holds the X corporation stock which (3) Reduction in net value of a LLC is a disregarded entity, A is treated as the has appreciated in value to $140,000. disregarded entity. For purposes of partner in LP for federal tax purposes. Only (ii) Under § 301.7701–3(b)(1)(ii) of this paragraph (k)(2) of this section, the net LLC has an obligation to make a payment on chapter, LLC2 is a disregarded entity. Both value of a disregarded entity is account of the $300,000 debt if LP were to LLC and LLC2 have obligations to make a determined by taking into account a constructively liquidate as described in payment on account of LP’s debts if LP were subsequent reduction in the net value of paragraph (b)(1) of this section. Therefore, to constructively liquidate as described in under paragraph (k) of this section, A is paragraph (b)(1) of this section. Therefore, the disregarded entity if at the time the treated as bearing the economic risk of loss under paragraph (k) of this section, A is net value of the disregarded entity is for LP’s $300,000 debt only to the extent of treated as bearing the economic risk of loss determined it is anticipated that the net LLC’s net value. Because that net value is $0 for LP’s $100,000 and $300,000 debts only to value of the disregarded entity will on December 31, 2006, when LP determines the extent of the net values of LLC and LLC2, subsequently be reduced and the its partners’ shares of its $300,000 debt, A is as allocated among those debts in a reduction is part of a plan that has as not treated as bearing the economic risk of reasonable manner pursuant to paragraph one of its principal purposes creating loss for any portion of LP’s $300,000 debt. As (k)(4) of this section. the appearance that a partner bears the a result, LP’s $300,000 debt is characterized (iii) No events have occurred that would economic risk of loss for a partnership as nonrecourse under § 1.752–1(a) and is allow a revaluation under paragraph (k)(2) of allocated as required by § 1.752–3. this section. Therefore, LLC’s net value liability. Example 2. Disregarded entity with positive remains $175,000. LLC2’s net value on (4) Allocation of net value. If one or net value. (i) The facts are the same as in December 31, 2008, when LP determines its more disregarded entities have Example 1 except that on January 1, 2007, A partners’ shares of its liabilities, is $140,000. obligations that may be taken into contributes $250,000 to LLC and LLC shortly Under paragraph (k)(4) of this section, LP account under paragraph (b)(1) of this thereafter uses the $250,000 to purchase must allocate the net values of LLC and LLC2 section with respect to one or more unimproved land. LP makes payments of between its $100,000 and $300,000 debts in
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a reasonable and consistent manner. Because SUMMARY: This document contains [The F reorganization] encompass[es] only the $100,000 debt is senior in priority to the proposed regulations that provide the simplest and least significant of corporate $300,000 debt, LP first allocates the net guidance regarding the requirements for changes. The (F)-type reorganization values of LLC and LLC2, pro rata, to its a transaction to qualify as a presumes that the surviving corporation is $100,000 debt. Thus, LP allocates $56,000 of the same corporation as the predecessor in LLC’s net value and $44,000 of LLC2’s net reorganization under section every respect, except for minor or technical value to its $100,000 debt, and A is treated 368(a)(1)(E) or (F) of the Internal differences. For instance, the (F) as bearing the economic risk of loss for all Revenue Code. The proposed reorganization typically has been understood of LP’s $100,000 debt. As a result, all of LP’s regulations will affect corporations and to comprehend only such insignificant $100,000 debt is characterized as recourse their shareholders. modifications as the reincorporation of the under § 1.752–1(a) and is allocated to A DATES: Written or electronic comments same corporate business with the same assets under this section. LP then allocates the and requests for a public hearing must and the same stockholders surviving under a new charter either in the same or in a remaining $119,000 of LLC’s net value and be received by November 10, 2004. LLC2’s $96,000 net value to its $300,000 debt, different State, the renewal of a corporate and A is treated as bearing the economic risk ADDRESSES: Send submissions to: charter having a limited life, or the of loss for a total of $215,000 of the $300,000 CC:PA:LPD:PR (REG–106889–04), room conversion of a U.S.-chartered savings and debt. As a result, $215,000 of LP’s $300,000 5203, Internal Revenue Service, PO Box loan association to a State-chartered debt is characterized as recourse under 7604, Ben Franklin Station, Washington, institution. § 1.752–1(a) and is allocated to A under this DC 20044. Submissions may be hand- Berghash v. Commissioner, 43 T.C. 743, section, and the remaining $85,000 of LP’s delivered Monday through Friday 752 (1965) (citation and footnotes $300,000 debt is characterized as between the hours of 8 a.m. and 4 p.m. omitted), aff’d, 361 F.2d 257 (2nd Cir. nonrecourse under § 1.752–1(a) and is to CC:PA:LPD:PR (REG–106889–04), allocated as required by § 1.752–3. This 1966). example illustrates one reasonable method Courier’s Desk, Internal Revenue To qualify as a reorganization, a for allocating net values of disregarded Service, 1111 Constitution Avenue, transaction must generally satisfy not entities among multiple partnership NW., Washington, DC, or sent only the statutory requirements of the liabilities. electronically, via the Internal Revenue reorganization provisions but also Service Internet site at http:// (l) Effective dates. Paragraphs (a), certain nonstatutory requirements, www.irs.gov/regs or via the Federal (b)(6), (h)(3), and (k) of this section including the continuity of interest and eRulemaking Portal at http:// apply to liabilities incurred or assumed continuity of business enterprise www.regulations.gov (IRS–REG– by a partnership on or after the date the requirements. See § 1.368–1(b). The 106889–04). regulations are published as final purpose of the continuity requirements regulations in the Federal Register, FOR FURTHER INFORMATION CONTACT: is to ensure that reorganizations are other than liabilities incurred or Concerning the proposed regulations, limited to readjustments of continuing assumed by a partnership pursuant to a Robert B. Gray, (202) 622–7550; interests in property under modified written binding contract in effect prior concerning submissions of comments, corporate form and to prevent to that date. Otherwise, the rules Guy R. Traynor, (202) 622–7180 (not transactions that resemble sales from applicable to liabilities incurred or toll-free numbers). qualifying for nonrecognition of gain or assumed (or subject to a binding SUPPLEMENTARY INFORMATION: loss available to corporate contract in effect) prior to the date the reorganizations. § 1.368–1(d)(1) and Background and Explanation of (e)(1); see also LeTulle v. Scofield, 308 regulations are published as final Provisions regulations in the Federal Register are U.S. 415 (1940); Helvering v. Minnesota contained in §§ 1.752–2 and 1.752–3 in In general, upon the exchange of Tea Co., 296 U.S. 378 (1935); Pinellas effect prior to the date the regulations property, gain or loss must be accounted Ice & Cold Storage Co. v. Commissioner, are published as final regulations in the for if the new property differs 287 U.S. 462 (1933). Federal Register, (see 26 CFR part 1 materially, in kind or extent, from the Despite the general rule, the courts revised as of April 1, 2004). old property. See Internal Revenue Code and the Service have taken the position (Code) § 1001; § 1.368–1(b). The purpose that the continuity of interest and Approved: July 12, 2004. of the reorganization provisions of the continuity of business enterprise Nancy Jardini, Internal Revenue Code (the Code) is to requirements need not be satisfied for a Acting Deputy Commissioner for Services and except from the general rule certain transaction to qualify as an E Enforcement. specifically described exchanges that reorganization. See Hickok v. [FR Doc. 04–18372 Filed 8–11–04; 8:45 am] are required by business exigencies and Commissioner, 32 T.C. 80 (1959); Rev. BILLING CODE 4830–01–P effect only a readjustment of continuing Rul. 82–34 (1982–1 C.B. 59); Rev. Rul. interests in property under modified 77–415 (1977–2 C.B. 311). In Revenue corporate forms. See § 1.368–1(b). Rulings 77–415 and 82–34, the IRS DEPARTMENT OF THE TREASURY Section 368(a)(1)(E) provides that the reasoned that the continuity of interest term reorganization includes a and continuity of business enterprise Internal Revenue Service recapitalization (an E reorganization). A requirements are necessary in an recapitalization has been defined as a acquisitive reorganization to ensure that 26 CFR Part 1 ‘‘reshuffling of a capital structure within the transaction does not involve an [REG–106889–04] the framework of an existing otherwise taxable transfer of stock or corporation.’’ Helvering v. Southwest assets, but that they are not necessary RIN 1545–BD31 Consolidated Corp., 315 U.S. 194 (1942). when the transaction involves only a Section 368(a)(1)(F) provides that the single corporation. Reorganizations Under Section term reorganization includes a mere Although an F reorganization may 368(a)(1)(E) or (F) change in identity, form, or place of involve an actual or deemed transfer of AGENCY: Internal Revenue Service, organization of one corporation, assets from one corporation to another, Treasury. however effected (an F reorganization). such a transaction effectively involves One court has described the F only one corporation. In this way, an F ACTION: Notice of proposed rulemaking. reorganization as follows: reorganization is much like an E
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reorganization, which can only involve proposed regulations further provide continuation of the merging corporation one corporation even in form. As a that a transaction that involves an actual for purposes of allowing a loss result, an F reorganization is treated for or deemed transfer is a mere change carryback, despite the forced most purposes of the Code as if the only if four requirements are satisfied. redemption of nine percent of the stock reorganized corporation were the same First, all the stock of the resulting of the merging corporation). entity as the corporation in existence corporation, including stock issued The third requirement (providing for before the reorganization. Consequently, before the transfer, must be issued in the liquidation of the transferring the taxable year of the corporation does respect of stock of the transferring corporation) and the fourth requirement not end on the date of the transfer, and corporation. Second, there must be no (limiting the assets the resulting the losses of the reorganized corporation change in the ownership of the corporation may hold immediately can be carried back to offset income of corporation in the transaction, except a before the transfer) reflect the statutory its predecessor. See § 1.381(b)–1(a)(2). change that has no effect other than that requirement that an F reorganization Nonetheless, courts have applied the of a redemption of less than all the involve only one corporation. Although continuity requirements in determining shares of the corporation. Third, the the proposed regulations generally whether a transaction qualifies as an F transferring corporation must require that the transferring corporation reorganization. See, e.g., Pridemark, Inc. completely liquidate in the transaction. completely liquidate in the transaction, v. Commissioner, 345 F.2d 35 (4th Cir. Fourth, the resulting corporation must they do not require the transferring 1965) (stating that the application of the not hold any property or have any tax corporation to legally dissolve, thereby F reorganization statute is limited to attributes (including those specified in facilitating preservation of the value of cases where the corporate enterprise section 381(c)) immediately before the the transferring corporation’s charter. continues uninterrupted, except transfer. Further, to accommodate transactions in perhaps for a distribution of some of its The first two requirements reflect the jurisdictions where it is customary to liquid assets); Yoc Heating Corp. v. Supreme Court’s holding in Helvering v. preserve pre-existing entities for future Commissioner, 61 T.C. 168 (1973) Southwest Consolidated, 315 U.S. 194 use rather than create new ones, the (holding that continuity of interest is (1942), that a transaction that shifts the proposed regulations permit the required for an F reorganization). ownership of the proprietary interests in retention of a nominal amount of assets The Service and the Treasury a corporation cannot be a mere change. for the sole purpose of preserving the Department have considered whether These requirements prevent a transferring corporation’s legal continuity of interest and continuity of transaction that involves the existence. business enterprise should be introduction of a new shareholder or Although the proposed regulations requirements of an F reorganization. new capital into the corporation from generally require that the resulting Because F reorganizations involve only qualifying as an F reorganization. Such corporation not hold any property or the slightest change in a corporation and an introduction may occur, for example, have any tax attributes immediately do not resemble sales, the Service and when a new shareholder contributes before the transfer, they do allow the the Treasury Department have assets to the resulting corporation in resulting corporation to hold or to have concluded that applying the continuity exchange for stock before a merger of held a nominal amount of assets to of interest and continuity of business the transferring corporation into the facilitate its organization or preserve its enterprise requirements to transactions resulting corporation. Notwithstanding existence, and to have tax attributes that would otherwise qualify as F these requirements, the proposed related to these assets. In addition, to reorganizations is not necessary to regulations permit the resulting accommodate transactions involving the protect the policies underlying the corporation’s issuance of a nominal refinancing of debt or the leveraged reorganization provisions. Therefore, amount of stock not in respect of stock redemption of shareholders, the these proposed regulations provide that of the transferring corporation to proposed regulations provide that this a continuity of interest and a continuity facilitate the organization of the requirement will not be violated if, of business enterprise are not required resulting corporation. This rule is before the transfer, the resulting for a transaction to qualify as an F designed to permit reincorporation in a corporation holds the proceeds of reorganization. In addition, to reflect the jurisdiction that requires, for example, borrowings undertaken in connection IRS’ position in Revenue Rulings 77– minimum capitalization, two or more with the transaction. 415 and 82–34, these proposed shareholders, or ownership of shares by As described above, section regulations provide that a continuity of directors. It is also intended to permit a 368(a)(1)(F) provides that an F interest and a continuity of business transfer of assets to certain pre-existing reorganization includes a mere change enterprise are not required for a entities. in identity, form, or place of transaction to qualify as an E The second requirement allows organization of one corporation, reorganization. changes of ownership that have no however effected. The IRS and the In light of the proposed rules effect other than a redemption of less Treasury Department believe that the regarding the application of the than all the shares of the corporation to inclusion of the words ‘‘however continuity requirements to transactions reflect the case law holding that certain effected’’ in the statutory definition of that otherwise qualify as F transactions qualify as F reorganizations an F reorganization reflects a reorganizations, the IRS and the even if shareholders are redeemed in the Congressional intent to treat as an F Treasury Department believe it is transaction. See Reef Corp. v. U.S., 368 reorganization a series of transactions desirable to provide guidance regarding F.2d 125 (5th Cir. 1966) (holding that a that together result in a mere change. the characteristics of F reorganizations. redemption of 48 percent of the stock of The proposed regulations reflect this These regulations propose such criteria. a corporation that occurred during a view by providing that a series of Consistent with section 368(a)(1)(F), change in place of incorporation did not related transactions that together result the proposed regulations provide that, cause the transaction to fail to qualify as in a mere change may qualify as an F to qualify as an F reorganization, a an F reorganization); cf. Casco Products reorganization. transaction must result in a mere change Corp. v. Commissioner, 49 T.C. 32 The IRS and the Treasury Department in identity, form, or place of (1967) (holding that the surviving also recognize that a reorganization organization of one corporation. The corporation in a merger was the qualifying under section 368(a)(1)(F)
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may be a step in a larger transaction that These regulations are proposed to be List of Subjects 26 CFR Part 1 effects more than a mere change. For effective for transactions that occur on Income taxes, Reporting and example, in Revenue Ruling 96–29 or after the date of these regulations are recordkeeping requirements. (1996–1 C.B. 50), the IRS ruled that a published as final regulations in the reincorporation qualified as an F Federal Register. Proposed Amendments to the reorganization even though it was a step Regulations Effect on Other Documents in a transaction in which the Accordingly, 26 CFR part 1 is reincorporated entity issued common Upon the issuance of these proposed to be amended as follows: stock in a public offering and redeemed regulations as final regulations, Rev. stock having a value of 40 percent of the Rul. 66–284 (1966–2 C.B. 115), Rev. Rul. PART 1—INCOME TAXES aggregate value of its outstanding stock 74–36 (1974–1 C.B. 85), Rev. Rul. 77– Paragraph 1. The authority citation before the offering. In the same ruling, 415 (1977–2 C.B. 311), Rev. Rul. 77–479 the IRS ruled that a reincorporation of for part 1 continues to read, in part, as (1977–2 C.B. 119), Rev. Rul. 79–250 follows: a corporation in another state qualified (1979–2 C.B. 156), Rev. Rul. 82–34 as an F reorganization even though it (1982–1 C.B. 59), and Rev. Rul. 96–29 Authority: 26 U.S.C. 7805 * * * was a step in a transaction in which the (1996–1 C.B. 50), will be obsoleted. Par. 2. Section 1.368–1(b) is amended reincorporated entity acquired the Special Analyses by adding a sentence after the third business of another entity. sentence to read as follows: Consistent with Revenue Ruling 96– It has been determined that this notice 29, the proposed regulations provide § 1.368–1 Purpose and scope of exception of proposed rulemaking is not a that related events preceding or of reorganization exchanges. significant regulatory action as defined following the transaction or series of * * * * * in Executive Order 12866. Therefore, a transactions that constitute a mere regulatory assessment is not required. It (b) Purpose. * * * Notwithstanding change do not cause that transaction or has also been determined that section the previous sentence, for transactions series of transactions to fail to qualify as 553(b) of the Administrative Procedure on or after [the date these regulations an F reorganization. The proposed Act (5 U.S.C. chapter 5) does not apply are published as final regulations in the regulations further provide that the to these regulations, and, because these Federal Register], a continuity of the qualification of the mere change as an regulations do not impose a collection business enterprise and a continuity of F reorganization does not alter the of information on small entities, the interest are not required for a treatment of the larger transaction. For Regulatory Flexibility Act (5 U.S.C. transaction to qualify as a reorganization example, if a redemption of stock occurs chapter 6) does not apply. Pursuant to under section 368(a)(1)(E) or (F). * * * in a transaction that qualifies as an F section 7805(f) of the Code, this notice * * * * * reorganization and the F reorganization of proposed rulemaking will be Par. 3. Section 1.368–2 is amended is part of a plan that includes a submitted to the Chief Counsel for by: subsequent merger, the step or series of Advocacy of the Small Business 1. Adding and reserving new steps constituting the F reorganization Administration for comment on its paragraph (l). will not alter the tax consequences of impact on small businesses. 2. Adding new paragraph (m). the subsequent merger. The addition reads as follows: A number of commentators have Comments and Requests for a Public questioned whether distributions of Hearing § 1.368–2 Definition of terms. money or other property in an F * * * * * reorganization are distributions to Before these proposed regulations are (l) [Reserved]. which section 356 applies. The IRS and adopted as final regulations, (m) Qualification as a reorganization the Treasury Department believe it is consideration will be given to any under section 368(a)(1)(F)—(1) Mere appropriate to treat such distributions as written (a signed original and eight (8) change—(i) In general. To qualify as a transactions separate from the F copies) or electronic comments that are reorganization under section reorganization, even if they occur submitted timely to the Service. The IRS 368(a)(1)(F), a transaction must result in during the F reorganization. See, e.g., and Treasury Department request a mere change in identity, form, or place § 1.301–1(l). Accordingly, these comments on the clarity of the proposed of organization of one corporation proposed regulations provide that if a rules and how they can be made easier (‘‘mere change’’). A transaction that shareholder receives money or other to understand. All comments will be involves an actual or deemed transfer is property (including in exchange for its available for public inspection and a mere change only if— shares) from the transferring or resulting copying. A public hearing will be (A) All the stock of the resulting corporation in a transaction that scheduled if requested in writing by any corporation, including stock issued constitutes an F reorganization, the person that timely submits written before the transfer, is issued in respect money or other property is treated as comments. If a public hearing is of stock of the transferring corporation; distributed by the transferring scheduled, notice of the date, time, and (B) There is no change in the corporation immediately before the place for the public hearing will be ownership of the corporation in the transaction. The tax treatment of such published in the Federal Register. transaction, except a change that has no distributions is governed by sections Drafting Information effect other than that of a redemption of 301 and 302, and section 356 does not less than all the shares of the apply to such distributions. The IRS and The principal author of these corporation; the Treasury Department believe that proposed regulations is Robert B. Gray (C) The transferring corporation the same rule should apply in the of the Office of Associate Chief Counsel completely liquidates in the transaction; context of E reorganizations. Comments (Corporate). However, other personnel and are requested on whether there are some from the Service and Treasury (D) The resulting corporation does not E reorganizations to which this Department participated in their hold any property or have any tax treatment should not apply. development. attributes (including those specified in
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section 381(c)) immediately before the (5) Examples. The following examples the S stock are nominal and used to facilitate transfer. illustrate the application of this the organization of T within the meaning of (ii) Exceptions and special rules—(A) paragraph (m). In all examples, assume paragraph (m)(1)(ii)(B) of this section. that each transaction is entered into for Therefore, the issuance of this stock to a new Transferring corporation. Legal shareholder does not cause the merger of S dissolution of the transferring a valid business purpose and that all into T to fail to be a mere change. corporation is not required, and the corporations are domestic corporations, Accordingly, the merger is a reorganization mere retention of a nominal amount of unless stated otherwise. The examples under section 368(a)(1)(F). assets for the sole purpose of preserving are as follows: Example 4. A owns all of the stock of H, the corporation’s legal existence will not Example 1. C owns all of the stock of W, a corporation that owns all of the stock of S, disqualify the transaction as a mere a State A corporation. The net value of W’s a corporation engaged in a manufacturing change. assets and liabilities is $1,000,000. V, a State business. H has owned the stock of S for B corporation, seeks to acquire the assets of many years. H owns no assets other than the (B) Resulting corporation. A stock of S. A decides to eliminate the holding transaction will not fail to be a mere W. To effect the acquisition, V and W enter into an agreement under which V will company structure by merging H into S. change solely because the resulting Because it operates a manufacturing corporation, to facilitate its contribute $1,000,000 to U, a newly formed corporation of which V is the sole business, the resulting corporation, S, holds organization, issues a nominal amount shareholder, and W will merge into U. In the property and has tax attributes immediately of stock other than in respect of stock merger, C surrenders his W stock in exchange before the transfer. Therefore, under of the transferring corporation. At the for the $1,000,000 V contributed to U. After paragraph (m)(1)(i)(D) of this section, the time of or before the transfer, the the merger, U holds all of the assets and merger of H into S is not a mere change and liabilities of W. However, the U stock is not does not qualify as a reorganization under resulting corporation may hold or have section 368(a)(1)(F). The same result would held a nominal amount of assets to issued in respect of the W stock as required by paragraph (m)(1)(i)(A) of this section, and occur if, instead of H merging into S, S facilitate its organization or preserve its merged into H. existence as a corporation, and may the transaction results in a change in the ownership of W that has an effect other than Example 5. Corporation P owns all of the have tax attributes related to holding that of a redemption of some of the W shares stock of S1, a State X corporation. The such assets. Moreover, the resulting in violation of paragraph (m)(1)(i)(B) of this management of P determines that it would be corporation may hold the proceeds of section. Therefore, the merger of W into U is in the best interest of S1 to change its place borrowings undertaken in connection not a mere change and does not qualify as a of incorporation to State Y. Accordingly, with the transaction. reorganization under section 368(a)(1)(F). under an integrated plan, P forms S2, a new State Y corporation, P contributes the S1 (2) Non-application of continuity of Example 2. A and B own 75 and 25 percent, respectively, of the stock of X, a stock to S2, and S1 merges into S2 under the interest and continuity of business laws of State X and State Y. Under paragraph enterprise requirements. A continuity of State A corporation. The management of X determines that it would be in the best (m)(3)(i) of this section, a series of the business enterprise and a continuity interest of X to reorganize under the laws of transactions that together result in a mere of interest are not required for a State B. Accordingly, X forms Y, a State B change of one corporation may qualify as a transaction to qualify as a reorganization corporation, and X and Y enter into an reorganization under section 368(a)(1)(F). under section 368(a)(1)(F). See § 1.368– agreement under which X will merge into Y. The contribution of S1 stock to S2 and the 1(b). A does not wish to own stock in Y. In the merger of S1 into S2 together constitute a (3) Related transactions—(i) Series of merger, A surrenders her X stock in exchange mere change of S1. Therefore, the transaction qualifies as a reorganization under section transactions. A series of related for cash from X from X’s cash reserves, and B exchanges all of his X stock for all the stock 368(a)(1)(F). S1 is treated as transferring its transactions that together result in a of Y. Without regard to A’s surrender of her assets to S2 in exchange for the S2 stock and mere change may qualify as a stock in X, the merger of X into Y is a mere distributing the S2 stock to P in exchange for reorganization under section change of X. The change in ownership P’s S1 stock. 368(a)(1)(F). caused by A’s surrender of her stock in X has Example 6. Corporation P owns all of the (ii) Mere change within a larger no effect other than that of a redemption of stock of S, a State X corporation. The transaction. A reorganization under less than all the X shares as described in management of P determines that it would be section 368(a)(1)(F) may occur within a paragraph (m)(1)(i)(B) of this section. in the best interest of S to change its place larger transaction that effects more than Therefore, the merger of X into Y is a mere of incorporation to State Y. Accordingly, P change and qualifies as a reorganization forms New S, a State Y corporation. S then a mere change. Related events that under section 368(a)(1)(F). merges into New S under the laws of State precede or follow the transaction or Example 3. D owns all of the stock of S, X and State Y. As part of the same plan, P series of transactions that constitutes a a Country A corporation. The management of sells all of its stock in New S to an unrelated mere change will not cause that S determines that it would be in the best party. Without regard to the sale of New S transaction or series of transactions to interest of S to reorganize under the laws of stock, the merger of S into New S is a mere fail to qualify as a reorganization under Country B. Under Country B law, a change within the meaning of paragraph section 368(a)(1)(F). Qualification of the corporation must have at least two (m)(1) of this section. Under paragraph mere change as a reorganization under shareholders to enjoy limited liability. D is (m)(3)(ii) of this section, related events that section 368(a)(1)(F) will not alter the advised by a Country B attorney that the new precede or follow the transaction or series of corporation should issue one percent of its transactions that constitute a mere change do treatment of the larger transaction. stock to a shareholder that is not D’s nominee not cause that transaction to fail to qualify as (4) Treatment of distributions. If a to assure satisfaction of the two-shareholder a reorganization under section 368(a)(1)(F). shareholder receives money or other requirement. As part of an integrated plan, E Therefore, the sale of the New S stock is property (including in exchange for its organizes T, a Country B corporation with disregarded in determining whether the shares) from the transferring or resulting 1,000 shares of common stock authorized, merger of S into New S is a mere change. corporation in a transaction that and contributes cash to T in exchange for ten Accordingly, the merger of S into New S is constitutes a reorganization under of the common shares. S then merges into T a reorganization under section 368(a)(1)(F). section 368(a)(1)(F), the money or other under the laws of Country A and Country B. Example 7. A owns all of the stock of T and Pursuant to the plan of merger, D surrenders none of the stock of P. P owns all of the stock property is treated as distributed by the his shares of stock in S in exchange for 990 of S. T and S are State M corporations transferring corporation immediately shares of T common stock. Without regard to engaged in manufacturing businesses. The before the transaction, and section the prior issuance of T stock to E, the merger following transactions occur pursuant to a 356(a) does not apply to such of S into T is a mere change of S. The ten single plan. First, T merges into S with A distribution. See, e.g., § 1.301–1(l). shares of stock issued to E not in respect of receiving solely stock in P. Second, P
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changes its state of incorporation to State N DEPARTMENT OF THE TREASURY Background and Explanation of by merging into newly organized New P Provisions under the laws of State M and State N. Third, Internal Revenue Service Temporary regulations in this issue of P redeems all the stock issued to A in respect the Federal Register amend 26 CFR part of his T stock for cash. Without regard to the 26 CFR Part 301 other steps, the merger of T into S qualifies 301 relating to section 7701 of the Internal Revenue Code of 1986 (Code). as a reorganization under section 368(a)(1)(A) [REG–124872–04] by reason of section 368(a)(2)(D). Without The temporary regulations provide regard to the other steps, the merger of P into guidance as to the definitions of a New P qualifies as a reorganization under RIN 1545–BD37 corporation and of domestic and foreign entities in circumstances in which an section 368(a)(1)(F). Under paragraph Clarification of Definitions (m)(3)(ii) of this section, related events that entity is created or organized under the laws of more than one jurisdiction (a precede or follow the transaction or series of AGENCY: Internal Revenue Service (IRS), dually chartered entity). The text of transactions that constitute a mere change do Treasury. not cause that transaction to fail to qualify as those regulations also serves as the text ACTION: Notice of proposed rulemaking a reorganization under section 368(a)(1)(F). of these proposed regulations. The by cross-reference to temporary Therefore, the merger of P into New P preamble to the temporary regulations regulations and notice of public hearing. qualifies as a reorganization under section explains both the temporary regulations and these proposed regulations. 368(a)(1)(F). However, under paragraph SUMMARY: This issue of the Federal (m)(3)(ii) of this section, the qualification of Register contains temporary regulations Special Analyses the merger of P into New P as a that provide clarification of the reorganization under section 368(a)(1)(F) It has been determined that this notice definitions of a corporation and a of proposed rulemaking is not a does not alter the tax treatment of the merger domestic entity in circumstances where of T into S. Because the P shares received by significant regulatory action as defined the business entity is considered to be A in respect of the T shares are redeemed for in Executive Order 12866. Therefore, a created or organized in more than one cash pursuant to the plan, the merger of T regulatory assessment is not required. It jurisdiction. These regulations will into S does not satisfy the continuity of also has been determined that section affect business entities that are created interest requirement and does not qualify as 553(b) of the Administrative Procedure a reorganization under section 368(a)(1)(A). or organized under the laws of more Act (5 U.S.C. chapter 5) does not apply Example 8. Corporation P owns all of the than one jurisdiction. The text of those to these regulations, and because the stock of S, a State A corporation. The temporary regulations also serves as the regulations do not impose a collection management of P determines that it would be text of these proposed regulations. This of information on small entities, the in the best interest of S to change its form document also provides a notice of a Regulatory Flexibility Act (5 U.S.C. from a State A corporation to a State A public hearing on these proposed chapter 6) does not apply. Pursuant to limited partnership. Accordingly, P regulations. section 7806(f) of the Code, this notice contributes one percent of the S stock to DATES: Written or electronic comments of proposed rulemaking will be newly formed LLC, a limited liability and must be received by November 10, submitted to the Chief Counsel for company, in exchange for all of the 2004. Requests to speak and outlines of Advocacy of the Small Business membership interests in LLC. Under topics to be discussed at the public Administration for comment on its § 301.7701–3 of this chapter, LLC is hearing scheduled for November 3, 2004 impact. disregarded as an entity separate from its must be received by October 15, 2004. owner, P. Under a State A statute, S converts Comments and Public Hearing ADDRESSES: Send submissions to: to a State A limited partnership. In the Before these proposed regulations are CC:PA:LPD:PR (REG–124872–04), Room conversion, P’s interest as a 99 percent adopted as final regulations, 5203, Internal Revenue Service, P.O. shareholder of S is converted into a 99 consideration will be given to any Box 7604, Ben Franklin Station, percent limited partner interest, and LLC’s written (a signed original and eight (8) Washington, DC 20044. Submissions interest as a one percent shareholder of S is copies) or electronic comments that are may also be hand-delivered Monday converted into a one percent general partner submitted timely to the IRS. The IRS through Friday (excluding Federal interest. S then elects, under § 301.7701–3(c), and Treasury Department request holidays) between the hours of 8 a.m. to be classified as a corporation for federal comments on the clarity of the proposed and 4 p.m. to CC:PA:LPD:PR (REG– income tax purposes, effective on the date of rules and how they can be made easier 124872–04), Courier’s Desk, Internal the conversion. The conversion of S from a to understand. All comments will be Revenue Service, 1111 Constitution State A corporation to a State A limited available for public inspection and Avenue NW., Washington, DC or sent partnership, together with the election to copying. electronically, via either the IRS internet treat S as a corporation for federal tax A public hearing has been scheduled site at www.irs.gov/regs or the Federal purposes, constitutes a mere change and is a for November 3, 2004 at 10 a.m. in the eRulemaking Portal at http:// reorganization under section 368(a)(1)(F). Auditorium of the Internal Revenue www.regulations.gov (IRS and REG– building, 1111 Constitution Avenue (6) Effective Date. This paragraph (m) 124872–04). The public hearing will be NW., Washington, DC. Due to building applies to transactions occurring on or held in the Auditorium, Internal security procedures, visitors must enter after [the date these regulations are Revenue Building, 1111 Constitution at the Constitution Avenue entrance. In published as final regulations in the Avenue NW., Washington, DC. addition, all visitors must present photo Federal Register]. FOR FURTHER INFORMATION CONTACT: identification to enter the building. Linda M. Kroening, Concerning the proposed regulations, Because of access restrictions, visitors Thomas Beem, (202) 622–3860; Acting Deputy Commissioner for Services and will not be admitted beyond the concerning submissions of comments or Enforcement. immediate entrance area earlier than 30 the public hearing, Sonya Cruse, (202) [FR Doc. 04–18476 Filed 8–11–04; 8:45 am] minutes prior to the start of the hearing. 622–7180 (not toll-free numbers). For information about having your name BILLING CODE 4830–01–P SUPPLEMENTARY INFORMATION: placed on the building access list to
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attend the hearing, see the FOR FURTHER (b) * * * Islands National Lakeshore, Route 1, INFORMATION CONTACT section of this (9) [The text of the proposed Box 4, Bayfield, Wisconsin 54814. preamble. amendment adding § 301.7701–2(b)(9) is Comments may also be submitted The rules of 26 CFR 601.601(a)(3) the same as the text of § 301.7701– electronically to: apply to this hearing. Persons who wish 2T(b)(9) published elsewhere in this [email protected]. to present oral comments at the hearing issue of the Federal Register.] FOR FURTHER INFORMATION CONTACT: must submit electronic or written * * * * * comments and an outline of the topics Gregory F. Zeman, Chief of Protection, Par. 4. Section 301.7701–5 is revised Apostle Islands National Lakeshore, to be discussed and the time devoted to to read as follows: each topic (signed original and eight (8) Route 1, Box 4, Bayfield, Wisconsin copies) by October 15, 2004. A period of § 301.7701–5 Domestic and foreign 54814. Telephone: (715) 779–3398, ten minutes will be allotted to each business entities. extension 201. person for making comments. An [The text of the proposed amendment SUPPLEMENTARY INFORMATION: agenda showing the scheduling of revising § 301.7701–5 is the same as the speakers will be prepared after the text of § 301.7701–5T published Background deadline for receiving outlines has elsewhere in this issue of the Federal The enabling legislation for Apostle passed. Copies of the agenda will be Register.] Islands National Lakeshore (PL–424, available free of charge at the hearing. Mark E. Matthews, enacted September 26, 1970) specifically authorized recreational use Proposed Effective Date Deputy Commissioner for Services and Enforcement. of the lakeshore by the public. It further The regulations proposed in this included provisions for hunting, fishing, [FR Doc. 04–18481 Filed 8–11–04; 8:45 am] document would apply on August 12, and trapping on the lands and waters 2004 to all business entities existing on BILLING CODE 4830–01–P within the boundaries, with certain or after that date. limitations allowed for public safety Drafting Information administration, fish or wildlife DEPARTMENT OF THE INTERIOR management, or public use and The principal author of these enjoyment. proposed regulations is Thomas Beem of National Park Service the Office of Associate Chief Counsel The lakeshore comprises 21 islands (International). However, other 36 CFR Part 7 and a 12-mile strip of mainland shoreline lying at the northern end of personnel from the IRS and Treasury RIN 1024–AD26 Department participated in their the Bayfield peninsula in Northern Wisconsin. Jurisdiction extends for a development. Apostle Islands National Lakeshore; distance of one-quarter mile offshore on Designation of Snowmobile and Off- List of Subjects in 26 CFR Part 301 the waters of Lake Superior surrounding road Motor Vehicle Routes, and Use of each island and along the mainland Employment taxes, Estate taxes, Portable Ice Augers or Power Engines Excise taxes, Gift taxes, Income taxes, coast. During the winter months, safe Penalties, Reporting and Recordkeeping AGENCY: National Park Service, Interior. access up to shoreline areas and requirements. ACTION: Proposed rule. traditional hunting, fishing, and trapping areas frequently requires over Proposed Amendments to the SUMMARY: The National Park Service ice travel by snowmobile and various Regulations (NPS) is proposing to designate areas forms of off-road motor vehicle Accordingly, 26 CFR part 301 is and routes on Lake Superior and the transportation within the quarter-mile proposed to be amended as follows: mainland unit for use by snowmobiles, jurisdiction. off-road motor vehicles, and ice augers The Federal legislation that PART 301—PROCEDURE AND or power engines within Apostle Islands established the Lakeshore in 1970 ADMINISTRATION National Lakeshore. The existing includes the water areas of Lake Paragraph 1. The authority citation regulations prohibit such use unless Superior that surround every island and for part 301 continues to read, in part, routes, areas and water surfaces are extend seaward from the mainland as follows: specifically identified and promulgated shoreline for a distance of one-quarter as special regulations. Unless otherwise mile. Authority: 26 U.S.C. 7805 * * * provided for by special regulation, the The use of snowmobiles, off-road Par. 2. In § 301.7701–1, paragraph (d) operation of snowmobiles and off-road motor vehicles, and ice augers or power is revised to read as follows: motor vehicles within areas of the engines was common prior to the National Park System is prohibited § 301.7701–1 Classification of establishment of the lakeshore and for a organizations for federal tax purposes. under existing regulations. The number of years following it. The use of intended effect of the special regulations ice augers or power engines is necessary * * * * * is to designate the routes, areas and (d) [The text of the proposed to provide access to the water through frozen water surfaces identified herein amendment revising § 301.7701–1(d) is the ice for authorized fishing activities. and remove the requirement for a permit the same as the text of § 301.7701–1T(d) Ice augers are typically operated only to operate an ice auger or power engine. published elsewhere in this issue of the once a day at the beginning of ice All other portions of the existing Federal Register.] fishing activities. The length of regulation, governing use, safety, and * * * * * operation is chiefly dependent on the operating requirements would remain in thickness of the ice, which can vary Par. 3. In § 301.7701–2 paragraph effect. (b)(9) is added to read as follows: from four inches to more than three feet. DATES: Written comments will be Most ice augers can cut through the ice § 301.7701–2 Business entities; accepted through October 12, 2004. surface in less than a few minutes. The definitions. ADDRESSES: Comments should be exclusive purpose of operation is to cut * * * * * addressed to: Superintendent, Apostle or bore small holes in the frozen surface
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of Lake Superior to allow fishing minimizing noise, pollution, and other expected on the wintering white-tailed equipment to pass freely. associated impacts. By contrast, deer population, other wildlife, or the These uses continue as a safe, recreational touring, which is not snow-covered vegetation. Therefore, it is common, and necessary method of allowed under this rule, would involve anticipated that adoption of this access up to shorelines and other continuous or prolonged operation of a regulation will not adversely affect the locations inside lakeshore boundaries snowmobile or off-road motor vehicle resources of the lakeshore. and corridors to areas outside the which would increase noise, pollution, Allowing the use of snowmobiles, off- lakeshore boundaries for gaining access and other associated impacts. road motor vehicles, and ice augers or to fishing areas during winter. The The designation of areas and routes power engines on the frozen surface of designation of routes and water surfaces on the frozen surface of Lake Superior Lake Superior is not expected to will provide the public with the means and mainland road is consistent with dramatically increase visitation to the to safely navigate around rough ice, areas and routes used by powerboats area. Traditional users include cracks, pressure ridges and other and motor vehicles during other times fishermen and recreational users that dangerous ice conditions on frozen Lake of year. These proposed regulations engage in winter hunting, trapping, Superior. It will facilitate traditional limit the designation of specific routes, camping, hiking, snowshoeing, skiing, and legislatively authorized uses such and further restrict designation of routes and other non-motorized recreational as hunting, fishing and trapping while to surfaces used by motor vehicles activities. also providing shoreline access for during other times of year. Because of Designated state and county trails for winter camping, hiking, snowshoeing, these proposed limitations, no snowmobile and off-road motor vehicle skiing, and other non-motorized additional snowmobile or off-road use are abundant throughout Ashland recreational activities within the motor vehicle routes will be established and Bayfield Counties. Bayfield County lakeshore. and access to hunting, fishing, trapping contains more than 430 miles of Under current NPS regulations, 36 areas, and non-motorized recreational maintained snowmobile trail and in CFR 2.18 and 36 CFR 4.10, the use of opportunities will continue to be excess of 108 miles of all-terrain vehicle snowmobiles and off-road motor pursued through hiking, skiing, and routes. Ashland County has more than vehicles within areas of the National snowshoeing activities in accordance 205 miles and 132 miles, respectively. Park System is prohibited, except on with Federal and State regulations. There is little demand for recreational designated routes and water surfaces Operation of power engines in other touring on the inherently dangerous ice that are used by motor vehicles or areas or for other purposes will continue of Lake Superior. motorboats during other seasons. These to be subject to authorization by permit Due to the short duration of routes and water surfaces must be only. accessibility, instability of the ice in all designated and must be promulgated as Less than 15 percent of the ice on but the most severe of winters, and special regulations. The use of portable Lake Superior that surrounds the limited need for access to non-NPS engines associated with a power ice islands is located within the lakeshore’s property outside the lakeshore 1 auger is allowed by permit only under ⁄4-mile boundary. Exterior areas are boundary, it is not anticipated that a 36 CFR 2.12(a)(3). owned by the State of Wisconsin and large increase in snowmobiles, off-road National Park Service Management allow snowmobile and off-road motor motor vehicles, or commercial Policies Section 8.2.2.1 states that any vehicle operation pursuant to State operations will result from adopting restriction of appropriate recreational regulations. With virtually unlimited these special regulations. With current uses will be limited to what is necessary snowmobile and off-road motor vehicle use limited and no significant increase to protect park resources and values, to use in State areas, which are directly expected, no measurable economic promote visitor safety and enjoyment, or adjacent to park boundaries, the most impact is anticipated. to meet park management needs. It also significant factor for noise and The NPS considers that local states the Superintendent will develop emissions in island and mainland residents, area businesses, and park and implement visitor use management locations inside the lakeshore boundary visitors are best served by allowing for plans and take management actions, as is wind speed and direction rather than the use of snowmobiles, off-road motor appropriate, to ensure that recreational where snowmobiles and off-road motor vehicles, and portable ice augers/ uses and activities within the park are vehicles are operated. Sound and engines in the designated areas and consistent with authorizing legislation emissions can travel long distances over routes to provide legal access for and do not cause unacceptable impacts the hard frozen surface of Lake hunting, fishing, trapping, and non- to park resources or values. Superior. After reviewing the issues The conditions that allow for motorized recreational activities. surrounding the use of snowmobiles, reasonably safe snowmobile and off- Compliance With Other Laws off-road motor vehicles, and ice augers road motor vehicle access on the frozen or power engines, NPS has determined surface of Lake Superior are generally Regulatory Planning and Review that the uses authorized in this rule are limited to late December through mid- (Executive Order 12866) consistent with the enabling legislation March. During this time period, a This document is not a significant and will not result in a derogation of majority of the wildlife has either rule and has not been reviewed by the resources, values, or purposes for which migrated from the area or is in Office of Management and Budget under the lakeshore was established. hibernation. The disruptive noise of Executive Order 12866. Snowmobiles and off-road motor snowmobiles, off-road motor vehicles, (1) This rule will not have an effect of vehicles are used as a means of and ice augers or power engines is not $100 million or more on the economy. transportation to a specific park expected to exceed the level generated It will not adversely affect in a material location, where the user participates in by motor boats during the summer way the economy, productivity, a non-motorized recreational activity. visitation season. Since snowmobiles competition, jobs, the environment, When the snowmobile/off-road motor and off-road motor vehicles are not public health or safety, or State, local, vehicle user reaches their destination, permitted to operate outside of or tribal governments or communities. the snowmobile or off-road motor designated roads on the mainland or on Snowmobiles and off-road motor vehicle is stopped with the engine off, the islands themselves, no impact is vehicles (all terrain vehicles) are not
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available for sale, rental, or lease Unfunded Mandates Reform Act Based on this determination, this through local businesses or tour This rule does not impose an rulemaking is categorically excluded companies within the Apostle Islands unfunded mandate on State, local, or from the procedural requirements of the (Chequamegon Bay) area. Snowmobiles tribal governments or the private sector National Environmental Policy Act and off-road motor vehicles are almost of more than $100 million per year. The (NEPA) by Departmental guidelines in exclusively privately owned or rule does not have a significant or 516 DM 6 (49 FR 21438). As such, transported to the region from sources unique effect on State, local or tribal neither an Environmental Assessment outside of the local geographic area. governments or the private sector. This nor an Environmental Impact Statement (2) This rule will not create a serious rule is an agency specific rule and does has been prepared. A categorical inconsistency or otherwise interfere not impose any other requirements on exclusion has been documented and is with an action taken or planned by other agencies, governments, or the on file with the park headquarters. another agency. Actions taken under private sector. this rule will not interfere with other Government-to-Government agencies or local government plans, Takings (Executive Order 12630) Relationship With Tribes policies or controls. This rule is an In accordance with Executive Order In accordance with the President’s agency specific rule. 12630, the rule does not have significant memorandum of April 29, 1994, (3) This rule does not alter the takings implications. A taking ‘‘Government to Government Relations budgetary effects of entitlements, grants, implication assessment is not required. with Native American Tribal user fees, or loan programs or the rights No taking of personal property will Governments’’ (59 FR 22951) and 512 or obligations of their recipients. This occur as a result of this rule. DM 2 have evaluated potential effects rule will have no effects on Federalism (Executive Order 13132) on federally recognized Indian tribes entitlements, grants, user fees, or loan and have determined that there are no programs or the rights or obligations of In accordance with Executive Order potential effects. Park staff consulted their recipients. No grants or other 13132, the rule does not have sufficient with the Red Cliff Band of Lake forms of monetary supplements are federalism implications to warrant the Superior Chippewa and the Great Lakes involved. preparation of a federalism assessment. Indian Fish and Wildlife Commission. (4) This rule does not raise novel legal This proposed rule only affects use of In return the park received a letter or policy issues. This rule codifies long- NPS administered lands and waters. generally supporting the proposed existing uses at Apostle Islands National regulations from the Red Cliff Band and Lakeshore and is not expected to be Civil Justice Reform (Executive Order 12988) verbal support from the Fish and controversial. Wildlife Commission. Regulatory Flexibility Act In accordance with Executive Order 12988, the Office of the Solicitor has Clarity of Rule The Department of the Interior determined that this rule does not certifies that this rulemaking will not unduly burden the judicial system and Executive Order 12866 requires each have a significant economic effect on a meets the requirements of sections 3(a) agency to write regulations that are easy substantial number of small entities and 3(b)(2) of the Order. to understand. We invite your under the Regulatory Flexibility Act (5 comments on how to make this rule U.S.C. 601 et seq.). Snowmobiles and Paperwork Reduction Act easier to understand, including answers off-road motor vehicles (all terrain This regulation does not require an to questions such as the following: (1) vehicles) are not available for sale, information collection from 10 or more Are the requirements in the rule clearly rental, or lease through local businesses parties and a submission under the stated? (2) Does the rule contain or tour companies within the Apostle Paperwork Reduction Act is not technical language or jargon that Islands (Chequamegon Bay) area. required. An OMB Form 83–I is not interferes with its clarity? (3) Does the Snowmobiles and off-road motor required. format of the rule (grouping and order vehicles are almost exclusively privately of sections, use of headings, National Environmental Policy Act owned or transported to the region from paragraphing, etc.) aid or reduce its sources outside of the local geographic The National Park Service has clarity? (4) Would the rule be easier to area. analyzed this rule in accordance with read if it were divided into more (but the criteria of the National shorter) sections? (A ‘‘section’’ appears Small Business Regulatory Enforcement Environmental Policy Act. The NPS has in bold type and is preceded by the Fairness Act (SBREFA) determined that this proposed symbol ‘‘§ ’’ and a numbered heading; This rule is not a major rule under 5 rulemaking will not have a significant for example § 7.82 Apostle Islands U.S.C. 804(2), the Small Business effect on the quality of the human National Lakeshore. (5) Is the Regulatory Enforcement Fairness Act. environment, health, and safety because description of the rule in the This proposed rule: it is not expected to: SUPPLEMENTARY INFORMATION section of a. Does not have an annual effect on (a) Increase public use to the extent of the preamble helpful in understanding the economy of $100 million or more. compromising the nature and character the proposed rule? What else could we b. Will not cause a major increase in of the area or causing physical damage do to make the rule easier to costs or prices for consumers, to it; understand? individual industries, Federal, State, or (b) Introduce incompatible uses Send a copy of any comments that local government agencies, or which might compromise the nature concern how we could make this rule geographic regions. and characteristics of the area, or cause easier to understand to: Office of c. Does not have significant adverse physical damage to it; Regulatory Affairs, Department of the effects on competition, employment, (c) Conflict with adjacent ownerships, Interior, Room 7229, 1849 C Street, investment, productivity, innovation, or or land uses; or NW., Washington, DC 20240. You may the ability of U.S.-based enterprises to (d) Cause a nuisance to adjacent also e–mail the comments to this compete with foreign-based enterprises. owners, or occupants. address: [email protected].
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Drafting Information (b) Snowmobiles. (1) Snowmobiles electric powered engine connected to a The primary authors of this may be operated in the following rotating helical shaft for boring through rulemaking are Robert J. Krumenaker, designated areas within the Lakeshore: the frozen surface of a lake. Superintendent, James A. Nepstad, (i) The frozen surface of Lake Superior (2) Power engine means a mobile Chief of Planning and Resource that surrounds every island from the gasoline or electric powered engine or Management, and Gregory F. Zeman, shoreline to the authorized boundary. device that is connected to a rotating Chief of Protection, Apostle Islands (ii) The frozen surface of Lake saw blade or teeth linked in an endless National Lakeshore. Superior from Sand Point to the chain for cutting through the frozen ice mainland unit’s eastern boundary. surface of a lake. Public Participation (iii) The 1⁄4 mile section of the Big (3) Notwithstanding the requirements If you wish to comment, you may Sand Bay Road that passes through the of 36 CFR 2.12(a)(3), operation of an ice submit your comments by any one of park mainland unit to non-NPS auger or power engine is authorized on several methods. You may mail property. designated portions of Lake Superior for comments to the Superintendent, (2) Snowmobile use is authorized for the specific purpose of cutting through Apostle Islands National Lakeshore, the purpose of providing access for legal the ice surface to provide access for Route 1, Box 4, Bayfield, Wisconsin forms of: legal ice fishing activity. 54814. You may also comment via the (i) Ice fishing. (4) Areas designated for use of an ice Internet to [email protected]. (ii) Hunting and trapping. auger or power engine include: Please also include ‘‘Winter Use Rule’’ (iii) Winter camping. (i) The frozen surface of Lake Superior in the subject line and your name and (iv) Other non-motorized recreational that surrounds every island from the return address in the body of your activities. shoreline to the authorized boundary. Internet message. Finally, you may hand (v) Access to non-NPS property by (ii) The frozen surface of Lake deliver comments to the owners, and use and occupancy Superior from Sand Point to the Superintendent, Apostle Islands properties by lessees and their mainland unit’s eastern boundary. National Lakeshore, 415 Washington representatives or guests. (5) Maps showing designated use Avenue, Bayfield, Wisconsin. (3) Snowmobiles may be used for areas shall be available at park Our practice is to make comments, administrative, law enforcement, and headquarters. including names and addresses of emergency services as determined by (6) Use of an ice auger or power respondents, available for public review the Superintendent. engine on any land surface or frozen during regular business hours. (4) Snowmobile use in areas and for water surface outside of designated use Individual respondents may request that purposes other than those stated in areas is prohibited without a permit. we withhold their home address from paragraphs (b)(1) and (b)(2) of this Dated: August 4, 2004. the rulemaking record, which we will section is prohibited. honor to the extent allowable by law. If (5) Maps showing designated use Paul Hoffman, you wish us to withhold your name areas are available at park headquarters. Deputy Assistant Secretary for Fish And and/or address, you must state this (c) Off-road vehicles. (1) Off-road Wildlife and Parks. prominently at the beginning of your motor vehicles may be operated in the [FR Doc. 04–18429 Filed 8–11–04; 8:45 am] comment. However, we will not following designated areas within the BILLING CODE 4312–97–P consider anonymous comments. We Lakeshore: will make all submissions from (i) The frozen surface of Lake Superior organizations or businesses, and from that surrounds every island from the DEPARTMENT OF HOMELAND individuals identifying themselves as shoreline to the authorized boundary. SECURITY representatives or officials or (ii) The frozen surface of Lake organizations or businesses, available Superior from Sand Point to the Coast Guard for public inspection in their entirety. mainland unit’s eastern boundary. (2) Off-road motor vehicle use is 46 CFR Part 66 List of Subjects in 36 CFR Part 7 authorized for the purpose of providing National Parks, Reporting and access for legal forms of: [USCG–1998–3798] recordkeeping requirements. (i) Ice fishing. RIN 1625–AA14 In consideration of the foregoing, the (ii) Hunting and trapping. National Park Service proposes to (iii) Winter camping. Numbering of Undocumented Barges amend 36 CFR part 7 as follows: (iv) Other non-motorized recreational activities. AGENCY: Coast Guard, DHS. PART 7—SPECIAL REGULATIONS, (v) Access to private property by ACTION: Notice of proposed rulemaking; AREAS OF THE NATIONAL PARK owners, and use and occupancy reopening of comment period. SYSTEM properties by lessees and their representatives or guests. SUMMARY: The Coast Guard is reopening 1. The authority citation for part 7 (3) Off-road motor vehicles may be the comment period on its notice of continues to read as follows: used for administrative, law proposed rulemaking on numbering of Authority: 16 U.S.C. 1, 3, 9a, 460(q), enforcement, and emergency services as undocumented barges, published in the 462(k); Sec. 7.96 also issued under D.C. Code determined by the Superintendent. Federal Register on January 11, 2001 8–137 (1981) and D.C. Code 40–721 (1981). (4) Off-road motor vehicle use in areas (66 FR 2385). Reopening the comment 2. Section 7.82 is amended by and for purposes other than those stated period gives the public more time to designating the existing text as in paragraphs (c)(1) and (c)(2) of this submit comments and recommendations paragraph (a) and adding paragraphs (b), section is prohibited. on the issues raised in the proposed (c), and (d) to read as follows: (5) Maps showing designated use rule. This rulemaking is necessary to areas are available at park headquarters. establish a statutorily required § 7.82 Apostle Islands National Lakeshore. (d) Ice augers and power engines. (1) numbering system for undocumented * * * * * Ice auger means a portable gasoline or barges more than 100 gross tons
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operating on the navigable waters of the specific section of the Notice of prevent these incidents, the Act added United States. Proposed Rulemaking to which each a new chapter 47 to title 46 of the DATES: Comments and related material comment applies, and give the reason United States Code that prohibits must reach the Docket Management for each comment. You may submit abandoning barges in the navigable Facility on or before November 10, your comments and material by mail, waters of the United States. The Act also 2004. hand delivery, fax, or electronic means amended 46 U.S.C. 12301 to require the to the Docket Management Facility at numbering of undocumented barges ADDRESSES: To make sure that your the address under ADDRESSES; but measuring more than 100 gross tons comments and related material are not please submit your comments and operating on the navigable waters of the entered more than once in the docket, material by only one means. If you United States. please submit them by only one of the submit them by mail or hand delivery, This numbering system will provide a following means: submit them in an unbound format, no (1) By mail to the Docket Management means for identifying parties larger than 81⁄2 by 11 inches, suitable for Facility (USCG–1998–3798), U.S. responsible for the now illegal copying and electronic filing. If you Department of Transportation, room PL– abandonment of barges. More submit them by mail and would like to 401, 400 Seventh Street, SW., importantly, it will help identify those know they reached the Facility, please Washington, DC 20590–0001. parties who may be held liable for the (2) By delivery to room PL–401 on the enclose a stamped, self-addressed removal and proper disposal of any Plaza level of the Nassif Building, 400 postcard or envelope. hazardous substances stored or Your comments and materials may Seventh Street, SW., Washington, DC, deposited on board abandoned barges, influence this rulemaking. We will between 9 a.m. and 5 p.m., Monday as well as for the removal of the barges consider all comments received during through Friday, except Federal holidays. from the nation’s waterways. This the comment period. The telephone number is 202–366– potential for liability would serve as a 9329. Regulatory History deterrent to barge abandonment. Taking into consideration the time (3) By fax to the Docket Management On October 18, 1994, the Coast Guard Facility at 202–493–2251. since the publication of the NPRM, the published a notice in the Federal Coast Guard is soliciting more public (4) Electronically through the Web Register (59 FR 52646) requesting site for the Docket Management System information before a final rule is comments on issues related to a published. at http://dms.dot.gov. numbering system for undocumented You must also mail comments on barges measuring more than 100 gross Public Meeting collection of information to the Office of tons. The primary issues addressed in Information and Regulatory Affairs, The Coast Guard plans no public the notice concerned who should Office of Management and Budget, 725 meeting. You may request a public administer a barge numbering system, 17th Street, NW., Washington, DC meeting by submitting a comment what type of number should be 20503, ATTN: Desk Officer, U.S. Coast requesting one to the address under required, and how much the numbering Guard. ADDRESSES. The request should include The Docket Management Facility system would cost. The Coast Guard the reasons why a meeting would be maintains the public docket for the received twenty-one comments in beneficial. If the Coast Guard rulemaking. Comments and material response to the notice. determines that a meeting should be On July 6, 1998, the Coast Guard received from the public will become held, we will announce the time and published an Advanced Notice of part of this docket and will be available place in a later notice in the Federal Proposed Rulemaking (ANPRM) in the for inspection or copying at room PL– Register. Federal Register (63 FR 36384), 401, located on the Plaza level of the discussing the proposed regulation, Dated: August 6, 2004. Nassif Building, 400 Seventh Street, comments received from the October Joseph J. Angelo, SW., Washington, DC, between 9 a.m. 1994 notice, and a preliminary Director of Standards, Marine Safety, Security and 5 p.m., Monday through Friday, regulatory assessment. & Environmental Protection. except Federal holidays. You may also On January 11, 2001, the Coast Guard [FR Doc. 04–18471 Filed 8–11–04; 8:45 am] find this docket on the Internet at published a Notice of Proposed BILLING CODE 4910–15–P http://dms.dot.gov. Rulemaking (NPRM) in the Federal FOR FURTHER INFORMATION CONTACT: If Register (66 FR 2385), discussing the you have questions on this rule, call Ms. proposed regulation, comments received NATIONAL AERONAUTICS AND Pat Williams, Project Manager, National from the ANPRM, and requesting SPACE ADMINISTRATION Vessel Documentation Center, Coast additional comments. Guard, telephone 304–271–2400, e-mail: The comments received from the 48 CFR Parts 1835 and 1852 [email protected]. If you have NPRM (see this docket on the Internet RIN 2700–AD04 questions on viewing the docket, call at http://dms.dot.gov) will be discussed Ms. Andrea M. Jenkins, Program in the final rule, along with comments Final Scientific and Technical Manager, Docket Operations, telephone received from this notice. Reports—SBIR and STTR Contracts 202–366–0271. Background and Purpose SUPPLEMENTARY INFORMATION: AGENCY: National Aeronautics and Congress passed the Abandoned Barge Space Administration. Request for Comments Act of 1992 (Public Law 102–587, ACTION: Proposed rule. We encourage you to participate in §§ 5301–05) (‘‘the Act’’). During passage this Coast Guard rulemaking by of the Act, Congress noted that SUMMARY: This rule proposes to amend submitting comments and related abandoned barges are often used for the the NASA FAR Supplement(NFS) by material. If you do so, please include illegal disposal of hazardous cargo, adding an Alternate III to the ‘‘Final your name and address, identify the waste, and petroleum products. This Scientific andTechnical Reports’’ clause docket number for this rulemaking illegal disposal can lead to actual or for use in contracts awarded under the (USCG–1998–3798), indicate the potential pollution incidents. To Small Business Innovation Research
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(SBIR) and the Small a substantial number of small entities dissemination of the data for conformance BusinessTechnology Transfer (STTR) with the meaning of the Regulatory with laws and regulations governing its programs. This change is required to Flexibility Act, 5 U.S.C. 601. et seq., distribution, including intellectual property recognize the ‘‘Rights in Data—SBIR because it only clarifies what the rights, export control, national security and Programs’’ clause rather than the FAR other requirements, and to the extent the appropriate data rights clause is used Contractor receives or is given access to data ‘‘Rights in Data—General’’ clause under SBIR and STTR contracts. necessary for the performance of the contract currently referenced in the NFS ‘‘Final C. Paperwork Reduction Act which contain restrictive markings, for Scientific and Technical Reports’’ complying with such restrictive markings. In clause. The Paperwork Reduction Act does the event the Contractor has established its not apply because the changes do not DATES: Comments should be submitted claim to copyright data produced under this on or before October 12, 2004, to be impose recordkeeping or information contract and has affixed a copyright notice collection requirements which require and acknowledgement of Government considered in formulation of the final sponsorship, or has affixed the SBIR Rights rule. the approval of the Office of Management and Budget under 44 Notice contained in paragraph (d) of FAR ADDRESSES: Interested parties may U.S.C. 3501, et seq. 52.227–20, the Government shall comply submit comments, identified by RIN with such Notices. number 2700–AD04 via the Federal List of Subjects in 48 CFR 1835 and [FR Doc. 04–18365 Filed 8–11–04; 8:45 am] 1852 eRulemaking Portal: http:// BILLING CODE 7510–01–P www.regulations.gov. Follow the Government Procurement. instructions for submitting comments. Tom Luedtke, Comments may also be submitted to DEPARTMENT OF TRANSPORTATION Celeste Dalton, NASA, Office of Assistant Administrator for Procurement. Procurement, Contract Management Accordingly, 48 CFR Parts 1835 and Research and Special Programs Division (Code HK), Washington, DC 1852 are amended as follows: Administration 20546. Comments can also be submitted 1. The authority citation for 48 CFR by e-mail to: Parts 1835 and 1852 continues to read 49 CFR Parts 171, 172, 173, 178, 179 [email protected]. as follows: and 180 FOR FURTHER INFORMATION CONTACT: Authority: 42 U.S.C. 2473(c)(1). [Docket No. RSPA–04–18683 (HM–218C)] Celeste Dalton, NASA, Office of Procurement, Contract Management PART 1835—RESEARCH AND RIN 2137–AD87 Division (Code HK); (202) 358–1645; e- DEVELOPMENT CONTRACTING mail: [email protected]. Hazardous Materials; Miscellaneous Amendments SUPPLEMENTARY INFORMATION: 2. Amend section 1835.070 by adding paragraph (d)(3) to read as follows: A. Background AGENCY: Research and Special Programs 1835.070 NASA contract clauses and Administration (RSPA), DOT. The NASA FAR Supplement at solicitation provision. ACTION: Notice of proposed rulemaking 1835.070(d) requires all research and * * * * * (NPRM). development contracts to include the (d) * * * clause at 1852.235–73, FinalScientific (3) Except when Alternate II applies SUMMARY: RSPA proposes to make and Technical Reports. SBIR and STTR in accordance with paragraph (d)(2) of miscellaneous amendments to the contracts are considered R&D contracts this section, the contracting officer shall Hazardous Materials Regulations based and must include the clause at insert the clause with its Alternate III in on petitions for rulemaking and RSPA 1852.235–73. This clause provides all SBIR and STTR contracts. initiatives. These proposed amendments direction to the contractor regarding its * * * * * are intended to update, clarify or ability to release data first produced or provide relief from certain regulatory used in performance of the contract. PART 1852—SOLICITATION requirements. However, the clause currently only PROVISIONS AND CONTRACT DATES: Comments must be received by address the contractor’s rights in data as CLAUSES defined in FAR 52.227–14, Rights in October 12, 2004. Data—General. Contractor rights in data 3. Amend section 1852.235–73 by ADDRESSES: You may submit comments under SBIR and STTR contracts are revising the date of the clause to read (identified by DOT DMS Docket Number defined in FAR clause 52.227–20, Rights (XX/XX); in the first sentence of RSPA–04–18683 (HM–218C)) by any of in Data—SBIR Program. This change paragraph (b), removing ‘‘NPG’’ and the following methods: proposes an Alternate III to 1852.235–73 adding ‘‘NPR’’ in its place; and adding • Web Site: http://dms.dot.gov. for use in SBIR and STTR contracts. The Alternate III to read as follows: Follow the instructions for submitting proposed Alternate III references FAR comments on the DOT electronic docket 52.227–20 to recognize contractor data 1852.235–73 Final Scientific and Technical site. Reports. rights under SBIR and STTR contracts. Fax: 202–493–2251. This is not a significant regulatory * * * * * Mail: Docket Management Facility; action and, therefore, was not subject to ALTERNATE III U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, review under section 6(b) of Executive (XX/XX) Order 12866, Regulatory Planning and PL–401, Washington, DC 20590–0001. As prescribed by 1835.070(d)(3), insert the Review, dated September 30, 1993. This Hand Delivery: Room PL–401 on the following as paragraph (e) of the basic clause: plaza level of the Nassif Building, 400 proposed rule is not a major rule under (e) The Contractor’s rights in data are 5 U.S.C. 804. defined in FAR 52.227–20, Rights In Data— Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday B. Regulatory Flexibility Act SBIR Program. The Contractor may publish, or otherwise disseminate, such data without through Friday, except Federal holidays. This proposed rule is not expected to prior review by NASA. The Contractor is Federal eRulemaking Portal: Go to have a significant economic impact on responsible for reviewing publication or http://www.regulations.gov. Follow the
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online instructions for submitting Division (OPPSD) (P–1429), we are (MOTS) by removing the phrase ‘‘in comments. proposing to incorporate by reference a direct support of a principal business Instructions: All submissions must document entitled ‘‘An Example of a that is other than transportation by include the agency name and docket Test Method for Vent Sizing—OPPSD/ motor vehicle.’’ This amendment will number or Regulatory Identification SPI Methodology’’ published in the clarify that hazardous materials being Number (RIN) for this rulemaking. For American Institute of Chemical transported for private carriage may be detailed instructions on submitting Engineers, Process Safety Progress transported under the MOTS exception, comments and additional information Journal, June 2002, issue (Vol. 21, No. if qualified, regardless of the principal on the rulemaking process, see the 2). The document describes an business of the carrier. Public Participation heading of the alternative method to determine the size SUPPLEMENTARY INFORMATION section of of emergency relief devices on portable Section 171.12a this document. Note that all comments tanks transporting organic peroxides. In paragraph (b)(2), we propose to received will be posted, without change, We are proposing to remove the clarify that certain exceptions in to http://dms.dot.gov including any American Society for Testing and Transport Canada’s Transportation of personal information provided. Please Materials ASTM A 607–98 ‘‘Standard Dangerous Goods (TDG) Regulations are see the Privacy Act heading under Specification for Steel, Sheet and Strip, not recognized under the reciprocity Regulatory Analyses and Notices. High-Strength, Low-Alloy, Columbium provisions; specifically, materials Docket: For access to the docket to or Vanadium, or Both, Hot-Rolled and subject to the 500 kg exception in read background documents and Cold-Rolled.’’ We are proposing to paragraph 1.16 of the TDG Regulations, comments received, go to http:// incorporate by reference the ASTM A may not be transported under the dms.dot.gov at any time or to Room PL– 1008/A 1008M–3 ‘‘Standard provisions of § 171.12a and are subject 401 on the plaza level of the Nassif Specification for Steel, Sheet, Cold- to the requirements of the HMR. Building, 400 Seventh Street, SW., Rolled, Carbon, Structural, High- Washington, DC between 9 a.m. and 5 Strength Low-Alloy and High Strength Section 171.14 p.m., Monday through Friday, except Low-Alloy with Improved Formability’’ Currently paragraph (d)(3) authorizes Federal holidays. and A 1011/A 1011M–03a ‘‘Standard use of the KEEP AWAY FROM FOOD FOR FURTHER INFORMATION CONTACT: Gigi Specification for Steel, Sheet and Strip, label and placard in effect on September Corbin, Office of Hazardous Materials Hot-Rolled, Carbon, Structural, High- 30, 1999, until October 1, 2003. Since Standards, (202) 366–8553, Research Strength Low-Alloy and High Strength the transition period has expired, we are and Special Programs Administration, Low-Alloy with Improved Formability.’’ proposing to remove paragraph (d)(3). U.S. Department of Transportation, 400 In 2000, ASTM A 607–98 was replaced Part 172 Seventh Street, SW., Washington, DC by ASTM A 1008/A 1008M–03 and A 20590–0001. 1011/A 1011M–03a. Section 172.101 SUPPLEMENTARY INFORMATION: We are also proposing to incorporate by reference the Department of Currently, use of specification 3T I. Background Defense’s (DOD) ‘‘Packaging of cylinders, which are bulk packagings, is authorized in the non-bulk packaging This NPRM is designed primarily to Hazardous Material, DLAD 4145.41/AR sections in column (8B) of the reduce regulatory burdens on industry 700–143/ AFJI 24–210/NAVSUPINST Hazardous Materials Table (HMT). We by incorporating changes into the 4030.55B/ MCO 4030.40B’’. See § 173.7 are proposing to add a statement in Hazardous Materials Regulations (HMR) preamble discussion. § 172.101(i)(3) and a new paragraph based on RSPA’s own initiatives and Also, we are proposing to update the (i)(5) to clarify that some bulk packaging petitions for rulemaking submitted in following documents which are authorizations are found in column (8B) accordance with 49 CFR 106.95. In a incorporated by reference: of the HMT and in special provisions in continuing effort to review the HMR for —Chlorine Institute instruction booklets column (7). necessary revisions, RSPA (‘‘we’’ and entitled ‘‘Chlorine Institute In the current HMT, ‘‘Bromine’’ and ‘‘us’’) is also proposing to eliminate, Emergency Kit ‘A’ for 100-lb. & 150- ‘‘Bromine solutions’’ are combined into revise, clarify and relax certain other lb. Chlorine Cylinders’’ (2000 one entry. The entry has a ‘‘+’’ in regulatory requirements. edition) and ‘‘Chlorine Institute Emergency Kit ‘B’ for Chlorine Ton column (1) which fixes the proper II. Public Participation Containers’’ (1996 edition) to the shipping name, hazard class, ID number Comments should identify the docket 2003 edition; and and packing group. Bromine and number (RSPA–04–18683) and, if sent —Transport Canada Transportation of bromine solutions are assigned to Class by mail, comments are to be submitted Dangerous Goods Regulations from 8 (corrosive) and have a subsidiary in duplicate. Persons wishing to receive the July 1985 edition to the August poison inhalation hazard in Zone A. It confirmation of receipt of their 2001 edition. has been brought to our attention that comments should include a self- In paragraph (b), we are proposing to some bromine solutions do not meet the addressed stamped postcard. Internet remove the table entry ‘‘National criteria for a PIH Zone A material and users may access all comments received Association of Corrosive Engineers are, in fact, in Hazard Zone B. Under the by the Department of Transportation at (NACE)’’ and NACE Standard current regulations, a bromine solution http://dms.dot.gov. TM090969 which describes an meeting the criteria for a PIH Zone B The following is a section-by-section acceptable test for a liquid corrosive material must be packaged and offered summary of the proposed changes. material. We failed to remove this entry for transportation in the same manner as when we revised the definition and a bromine solution meeting the criteria Section-by-Section Review testing methods for corrosive materials for a PIH Zone A material. We are Part 171 in a previous rulemaking. proposing to revise the HMT by adding two new entries, one for bromine Section 171.7 Section 171.8 solution, PIH Zone A and one for Based on a petition for rulemaking by We are proposing to revise the bromine solution, PIH Zone B. In the the Organic Peroxide Producers Safety definition for ‘‘Materials of trade’’ new table entries, we are proposing to
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delete special provisions A3 and A6 in pertaining to vessel stowage for this or greater strength and efficiency as column (7) since bromine and bromine entry. certified by DOD in accordance with the solutions are forbidden for We are proposing to revise the entry procedures prescribed by ‘‘Performance transportation by air. Additionally, for for ‘‘1,3,5-Trimethylbenzene, UN 2325’’ Oriented Packagings of Hazardous each entry we are proposing to add by adding a limited quantity exception Material, DLAR 4145.41/AR 700–143/ missing stowage category ‘‘D’’ for vessel for flammable liquids (see § 173.150) in AFR 71–5/NAVSUPINST 4030.55/MCO transportation in column 10A of the Column (8A) of the HMT. This revision 4030.40.’’ The DOD has revised this HMT. Stowage category ‘‘D’’ is would be consistent with entries for document and renamed it ‘‘Packaging of described in § 172.101(k)(4). other PG III flammable liquids in the Hazardous Material, DLAD 4145.41/AR In a final rule published on June 21, HMR and in international regulations. 700–143/AFJI 24–210/NAVSUPINST 2001 (HM–215D; 66 FR 33337), we Section 172.102 4030.55B/MCO 4030.40B.’’ In this removed the domestic entry ‘‘Denatured NPRM, we are proposing to update the Alcohol, NA 1987’’ based on our We are proposing to revise Special reference to the revised document. determination that the entry ‘‘Alcohols, provision 53 to provide relief from the n.o.s., UN 1987’’ was equally subsidiary hazard class/division entry Section 173.28 appropriate. The Renewable Fuels on the shipping paper if the material is In paragraph (b)(3), we are proposing Association (RFA) petitioned RSPA (P– excepted from the subsidiary label to clarify that packagings made of 1430) to reinstate the entry ‘‘Denatured requirements. fiberboard are authorized for reuse. Alcohol, NA 1987.’’ The petitioner Section 172.203 Section 173.31 states that based on the flashpoint of the material, some ethanol shippers are For readers’ convenience, we are Since January 1, 1978, new non- using the shipping description proposing to add a new paragraph (l)(4) pressure tank cars have had bottom ‘‘Flammable liquid, n.o.s., UN 1993’’ which cross-references § 171.4. Section outlet protection. To determine retrofit rather than ‘‘Alcohol, n.o.s., UN 1987.’’ 171.4 excepts marine pollutants in non- requirements, the FRA and the industry The RFA expressed concern for the bulk packagings from the HMR, except participated in a risk-analysis safety of emergency responders. The when transported by vessel. evaluation of the commodities carried in Emergency Response Guidebook (ERG) Section 172.205 these cars. Those commodities requiring directs emergency responders to Guide bottom outlet protection were listed in 128 for ID number 1993, and Section 172.205 prescribes shipping Appendix Y to the Tank Car Manual recommends ‘‘regular foam’’ to fight paper requirements for shipments of (AAR Manual of Standards and large fires. Guide 127 for ID number hazardous waste. Frequently, users of Recommended Practices,—1002). From 1987 recommends ‘‘alcohol-resistant the HMR are not aware that the word time to time, additional commodities foam.’’ The RFA states that the entry ‘‘Waste’’ must precede the proper have been added. As far back as 1981, ‘‘Denatured Alcohol, NA 1987’’ which shipping name as provided by the risk-analysis evaluation has corresponds to Guide 127 in the ERG is § 172.101(c)(9). We are proposing to add determined that molten sulfur does not the more appropriate shipping a new paragraph alerting the user to this require any retrofitted protection; description. Based on the petition, we requirement. consequently, it was not listed. Based are proposing to reinstate the entry. We Section 172.504 on similar analysis, elevated are also proposing to add the new temperature materials were not listed. In a final rule published on June 21, special provision for the entries Despite this, the regulations 2001 (HM–215D; 66 FR 33426), we ‘‘Denatured Alcohol, NA 1987’’ and promulgated under a final rule authorized the display of only one ‘‘Alcohols, n.o.s., UN 1987’’ to allow published on September 21, 1995 (HM– placard bearing one compatibility letter solutions of alcohol and petroleum 175A; 60 FR 49073), require retrofit by when certain Class 1 materials of products be described as either July 1, 2006, for all commodities not different compatibility groups are ‘‘Denatured Alcohol’’ or ‘‘Alcohols, specifically listed in Appendix Y. In transported together in a single n.o.s.’’ provided the solution contains this NPRM we are proposing to lessen transport vehicle or container. We are no more than 5% petroleum products. the burden on shippers of molten sulfur proposing to amend § 172.504(g)(2) to We are proposing to correct an error and elevated temperature materials by clarify that explosives articles of in columns (9A) and (9B) for the entries explicitly removing these commodities compatibility groups C, D, or E when ‘‘sec-Butyl chloroformate, NA 2742’’ from the requirement to retrofit tank transported with explosives articles in and ‘‘Isobutyl chloroformate, NA 2742.’’ cars. The current HMT reflects these material compatibility group N may be placarded may be transported by air. These with a Class 1 compatibility group D Section 173.150 materials are poisonous by inhalation in placard. Paragraph (f)(1) defines the term Hazard Zone B and are forbidden on Section 172.519 ‘‘combustible liquid’’ and states that a passenger and cargo only aircraft. flammable liquid reclassed as We are proposing to editorially revise We are proposing to revise the entry ‘‘combustible liquid’’ may not be paragraph (f) by adding the for ‘‘Refrigerating machines, containing transported by air or vessel, except parenthetical phrase ‘‘(IBR, see § 171.7 flammable, non-toxic, liquefied gas, UN when other means of transportation is of this subchapter),’’ after the wording 3358’’ by adding a reference to § 173.307 impracticable. Section 173.120 Class 3- ‘‘ICAO Technical Instructions, the in column (8A) of the HMT. Section Definitions, paragraph (b)(2), contains IMDG Code, or the TDG Regulations’’. 173.307 excepts refrigerating machines the same information. In this NPRM, we containing 12 kg (25 pounds) or less of Part 173 are proposing to remove paragraph (f)(1) a flammable, non-toxic gas from the to eliminate the redundancy. HMR, except when offered or Section 173.7 transported by air or vessel. We are also Currently, § 173.7 authorizes military Section 173.225 proposing to correct inconsistencies shipments of hazardous materials if the Currently, the Note to paragraph with the International Maritime materials are packaged in accordance (e)(3)(vi) directs the reader to Appendix Dangerous Goods (IMDG) Code with the HMR or in packagings of equal 5 of the UN Manual of Tests and Criteria
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for an example of a method to determine Section 173.302a and A 1011/A 1011M in its place. See the size of emergency-relief devices. The In paragraph (a), we are proposing a § 171.7 preamble discussion. American Institute of Chemical minor editorial change. Section 178.606 Engineers (AIChE), in a document In paragraph (d), we are proposing to published in the Process Safety Progress authorize use of a DOT 3AL1800 In paragraph (c)(2), we are proposing Journal (see § 171.7 preamble), describes cylinder for the transportation of to correct the formula for calculating the an alternative method to determine the diborane and diborane mixtures. pressure to be applied when a packaging size of emergency-relief devices on We are proposing to add paragraph (e) containing a solid is subjected to a portable tanks transporting organic to reinstate the requirement that a dynamic compression test. The formula peroxides. In this NPRM, we are cylinder containing fluorine may not be currently in the HMR is applicable to proposing to also authorize this charged to over 400 psig at 21 °C (70 °F) liquids. alternative method. and may not contain more than 2.7 kg Part 179 Section 173.241 (6 lbs) of gas. It was brought to our attention that this requirement was Section 179.200–7 For clarity, in paragraph (c), we are removed in HM–220D and, for safety We are proposing to amend paragraph proposing to add a reference to certain concerns, should be reinstated. (e) by adding a reference to § 171.7 for additional requirements in § 176.340 a standard that is incorporated by that apply when offering combustible Section 173.304a reference. liquids in portable tanks for In the paragraph (a)(2) table, in transportation by vessel. column 3, we are proposing to remove Part 180 Section 173.301 several references to DOT specification Section 180.205 4, 4A, 9, 38, 40 and 41 cylinders. In a In paragraph (a)(9), we are proposing final rule published August 8, 2002 In paragraph (c)(2), we are proposing to revise the second sentence containing (HM–220D; 67 FR 51647) we to add a reference to new § 180.212. See a requirement that the outside discontinued authorization for the use § 180.212 preamble discussion. Also, we packaging must conform to the of DOT 3C, 3D, 4, 4A, 4B240X, are proposing to broaden the provisions requirements in § 173.25. Because of 4B240FLW, 4C, 9, 25, 26, 33, 38, 40 and in paragraph (I)(2) to allow a composite their thin walls, size, or shape, 2P, 2Q, 41 cylinders. Also, for the entry cylinder that is condemned to have the 3E, 3HT, spherical 4BA, 4D, 4DA, 4DS, Bromotrifluoromethane, we propose to wording ‘‘CONDEMNED’’ displayed and 39 cylinders must be offered in a correct ‘‘DOT–3AL40’’ to read ‘‘DOT– instead of stamped on the cylinder. The combination packaging, where the 3AL400’’ in column 3. use of a label is currently authorized in cylinder is the inner packaging some exemptions. contained in a strong non-bulk outer Sections 173.314 and 173.319 Section 180.212 packaging. In addition to the applicable Currently the HMR require a shipper marking and labeling requirements in to notify the Bureau of Explosives (BOE) The HMR authorize the repair of DOT subparts D and E, respectively, the outer whenever a rail car containing a time- 4-series cylinders, but not DOT 3-series packaging must be marked with an sensitive product is not received by the cylinders. In this NPRM, we are indication that the inner packagings consignee within 20 days from proposing to allow repairs to a DOT 3- conform to the applicable specifications. shipment. We are proposing to revise series cylinder under the terms of an This change will remove the implication the requirement to require notification approval issued by the Associate that the outer packaging is an overpack to the appropriate office in the Federal Administrator under subpart H of part and, as such, each inner packaging must Railroad Administration. 107. In addition, the person that meet the applicable part 172 marking performs the repair work must have an Section 173.315 and labeling requirements. approval as currently required under In paragraph (l)(2), we are proposing We are proposing to revise the subpart I of part 107. to revise the wording to state clearly paragraph (a) table by adding a new Note in this regard, however, that that foreign cylinders filled for export Note 27 which authorizes the use of certain repairs to cylinders will not must be fitted with pressure relief non-specification cargo tanks for the require an approval. For example, an devices when required by the HMR for entry ‘‘Ammonia, anhydrous or approval will not be required for the the gas contained within the cylinder. In Ammonia solutions, with greater than removal and replacement of non- a final rule published on August 8, 2002 50 percent ammonia.’’ pressure components on a DOT 3-series (HM–220D; 67 FR 51645), we revised Section 173.337 cylinder, such as a neck ring or foot the language stating that the cylinders ring; the replacement material must be must meet the specifically listed In the introductory text, we are equivalent to that used at the time of requirements ‘‘in addition to other proposing to reinstate a requirement original manufacture. Such repairs were requirements of this subchapter.’’ In that a cylinder containing nitric oxide authorized in former § 173.34(h) of the removing the wording ‘‘in addition to may be charged to a pressure of not ° HMR for DOT 3A, 3AA, 3B, and the other requirements of this subchapter,’’ more than 5,170 kPa (750 psig) at 21 C ° obsolete 3C cylinder when performed by we inadvertently overlooked that the (70 F). It was brought to our attention a manufacturer of these types of wording included compliance with the that this requirement was inadvertently cylinders, tested and repaired under the pressure relief device requirements. removed in HM–220D and, for safety supervision of an inspector, and We are proposing to editorially revise concerns, should be reinstated. reported in accordance with the original paragraph (m) by adding the Part 178 specification. We removed § 173.34(h) parenthetical phrase ‘‘(IBR, see § 171.7 from the HMR in HM–220D. In this of this subchapter)’’ after the first Sections 178.338–2 and 178.345–2 NPRM, we propose to add these occurrence of the term ‘‘Canadian We are proposing to remove the requirements back into the regulations Transport of Dangerous Goods (TDG) reference to ASTM Standard A 607 and and also allow repairs to be made by a Regulations.’’ add ASTM Standards A 1008/A 1008M DOT authorized repair facility.
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Additionally, no approval will be references to standards that are than two years after the date of issuance. required for the repair of worn or incorporated in the HMR. These RSPA proposes the effective date of damaged cylinder neck threads when clarifications and updates of the HMR federal preemption be 90 days from performed by the original cylinder will enhance safety. publication of a final rule in this matter manufacturer in accordance with the in the Federal Register. B. Executive Order 13132 cylinder’s specification requirements C. Executive Order 13175 and under the supervision of an This proposed rule was analyzed in independent inspection agency. CGA accordance with the principles and This proposed rule has been analyzed Pamphlets C–6 and C–6.1 contain criteria contained in Executive Order in accordance with the principles and guidelines for inspection of the cylinder 13132 (‘‘Federalism’’). This proposed criteria contained in Executive Order neck areas for damaged threads. The rule would preempt state, local and 13175 (‘‘Consultation and Coordination cylinder must be rejected if the required Indian tribe requirements but does not with Indian Tribal Governments’’). number of effective threads are not propose any regulation that has Because this proposed rule does not engaged to provide a gas-tight seal. The substantial direct effects on the states, have tribal implications, does not rejected cylinder may qualify for repair the relationship between the national impose substantial direct compliance to restore the effectiveness of the government and the states, or the costs on Indian tribal governments, and threads. If the threads cannot be distribution of power and does not preempt tribal law, the funding repaired, the cylinder must be responsibilities among the various and consultation requirements of condemned. We proposed to update the levels of government. Therefore, the Executive Order 13175 do not apply, reference to CGA Pamphlet C–6.1 from consultation and funding requirements and a tribal summary impact statement the 1995 to the 2002 edition in an of Executive Order 13132 do not apply. is not required. NPRM published on September 10, 2003 Federal hazardous material D. Regulatory Flexibility Act, Executive (HM–220F; 68 FR 53318). The 2002 transportation law, 49 U.S.C. 5125(b)(1), Order 13272, and DOT Procedures and edition contains criteria for inspection contains an express preemption Policies of cylinder neck threads for abnormal provision (49 U.S.C. 5125(b)) The Regulatory Flexibility Act (5 thread conditions resulting from preempting state, local, and Indian tribe U.S.C. 601 et seq.) requires an agency to structural defects, corrosion, or damage. requirements on certain covered review regulations to assess their impact Currently CGA is updating CGA subjects. Covered subjects are: on small entities. An agency must Pamphlet C–6 to better address (i) The designation, description, and conduct a regulatory flexibility analysis inspection for neck areas on high classification of hazardous materials; unless it determines and certifies that a pressure and low pressure steel (ii) The packing, repacking, handling, rule is not expected to have a significant cylinders. We will consider adopting labeling, marking, and placarding of impact on a substantial number of small the revised pamphlet in a future notice hazardous materials; (iii) The preparation, execution, and entities. This proposed rule would of proposed rulemaking. use of shipping documents related to amend miscellaneous provisions in the Section 180.417 hazardous materials and requirements HMR to clarify provisions based on our In paragraph (b)(2)(v), we are related to the number, content, and own initiatives and also on petitions for proposing to reinstate the requirement placement of those documents; rulemaking. While maintaining safety, it that each test or inspection report (iv) The written notification, would relax certain requirements that completed for a repaired cargo tank recording, and reporting of the are overly burdensome and would must include the ASME or National unintentional release in transportation update references to consensus Board Certificate of Authorization of hazardous materials; or standards that are incorporated in the (v) The design, manufacture, number of the facility performing the HMR. The proposed changes are fabrication, marking, maintenance, repairs. generally intended to provide relief to reconditioning, repair, or testing of a shippers, carriers, and packaging Regulatory Analyses and Notices packaging or container which is manufacturers, including small entities. represented, marked, certified, or sold This proposed rule has been A. Executive Order 12866 and DOT as qualified for use in the transport of developed in accordance with Executive Regulatory Policies and Procedures hazardous materials. Order 13272 (‘‘Proper Consideration of This proposed rule is not considered This proposed rule concerns the Small Entities in Agency Rulemaking’’) a significant regulatory action under classification, packaging, marking, and DOT’s procedures and policies to section 3(f) and was not reviewed by the labeling, and handling of hazardous promote compliance with the Office of Management and Budget materials, among other covered subjects. Regulatory Flexibility Act to ensure that (OMB). The proposed rule is not If adopted as final, this rule would potential impacts of draft rules on small considered a significant rule under the preempt any State, local, or Indian tribe entities are properly considered. The Regulatory Policies and Procedures requirements concerning these subjects changes proposed in this Notice will order issued by the U.S. Department of unless the non-Federal requirements are enhance safety, and I certify that this Transportation (44 FR 11034). The costs ‘‘substantively the same’’ (see 49 CFR proposal, if promulgated, would not and benefits of this proposed rule are 107.202(d)) as the Federal requirements. have a significant economic impact on considered to be so minimal as to not Federal hazardous materials a substantial number of small entities. warrant preparation of a regulatory transportation law provides at 49 U.S.C. impact analysis or a regulatory 5125(b)(2) that if RSPA issues a E. Paperwork Reduction Act evaluation. regulation concerning any of the This proposed rule may result in a In this notice, we propose to amend covered subjects, RSPA must determine minimal change in information miscellaneous provisions in the HMR to and publish in the Federal Register the collection and recordkeeping burden clarify the provisions and to relax overly effective date of Federal preemption. under OMB Control Number 2137–0559, burdensome requirements. We are also That effective date may not be earlier due to editorial changes to §§ 173.314 responding to requests from industry than the 90th day following the date of and 173.319 regarding HMR associations to update and add issuance of the final rule and not later requirements to notify BOE whenever a
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rail car containing a time-sensitive listed in the Unified Agenda of Federal 49 CFR Part 172 product is not received by the consignee Regulations. The Regulatory Information Education, Hazardous materials within 20 days from shipment. Since Service Center publishes the Unified transportation, Hazardous waste, BOE no longer exists, we are proposing Agenda in April and October of each Labeling, Markings, Packaging and to remove references to BOE in year. The RIN number contained in the containers, Reporting and recordkeeping §§ 173.314 and 173.319, and replace heading of this document can be used requirements. them with references to FRA. This to cross-reference this action with the proposed rule may result in a minimal Unified Agenda. 49 CFR Part 173 change in burden since FRA instead of Hazardous materials transportation, G. Unfunded Mandates Reform Act BOE will now be notified if a rail car Packaging and containers, Radioactive containing a time-sensitive product is This proposed rule does not impose materials, Reporting and recordkeeping not received within 20 days from unfunded mandates under the requirements, Uranium. shipment. RSPA currently has an Unfunded Mandates Reform Act of approved information collection under 49 CFR Part 178 1995. It does not result in costs of OMB Control Number 2137–0559, $120.7 million or more to either state, Hazardous materials transportation, ‘‘Requirements for Rail Tank Car Motor vehicle safety, Packaging and Tanks—Transportation of Hazardous local, or tribal governments, in the aggregate, or to the private sector, and containers, Reporting and recordkeeping Materials by Rail’’ with 2,759 burden requirements. hours which expires on May 31, 2006. is the least burdensome alternative that Section 1320.8(d), Title 5, Code of achieves the objective of the rule. 49 CFR Part 179 Federal Regulations requires that RSPA H. Environmental Assessment Hazardous materials transportation, provide interested members of the Incorporation by reference, Railroad public and affected agencies an The National Environmental Policy safety, Reporting and recordkeeping opportunity to comment on information Act of 1969 (NEPA), as amended (42 requirements. collection and recordkeeping requests. U.S.C. 4321–4347) requires Federal This notice identifies a new information agencies to consider the consequences 49 CFR Part 180 collection request that RSPA will of major Federal actions and prepare a Hazardous materials transportation, submit to OMB for approval based on detailed statement on actions Incorporation by reference, Motor the requirements in this proposed rule. significantly affecting the quality of the vehicle safety, Packaging and RSPA has developed burden estimates human environment. We developed an containers, Reporting and recordkeeping to reflect changes in this proposed rule. assessment to determine the effects of requirements. RSPA estimates the total information the proposed revisions on the In consideration of the foregoing, 49 and recordkeeping burden as proposed environment and whether a more CFR Chapter I is proposed to be in this rule as: Requirements for Rail comprehensive environmental impact amended as follows: Tank Car Tanks—Transportation of statement may be required. We have Hazardous Materials by Rail’’ OMB tentatively concluded that there are no PART 171—GENERAL INFORMATION, Number 2137–0559: significant environmental impacts REGULATIONS, AND DEFINITIONS Total Annual Number of Respondents: associated with this proposed rule. 266. 1. The authority citation for part 171 Interested parties, however, are invited continues to read as follows: Total Annual Responses: 16,781. to review the Environmental Total Annual Burden Hours: 2,689. Authority: 49 U.S.C. 5101–5127, 44701; 49 Total Annual Burden Cost: $102,586.25. Assessment available in the docket and to comment on what environmental CFR 1.45 and 1.53; Pub. L. 101–410 section Requests for a copy of this 4 (28 U.S.C. 2461 note); Pub. L. 104–134 impact, if any, the proposed regulatory information collection should be section 31001. changes would have. directed to Deborah Boothe or T. Glenn 2. In § 171.7: Foster, Office of Hazardous Materials I. Privacy Act a. In the paragraph (a)(3) table: Standards (DHM–10), Research and (1) A new entry for the American Special Programs Administration, Room Anyone is able to search the Institute of Chemical Engineers is added 8430, 400 Seventh Street, SW., electronic form of any written to the table in appropriate alphabetical Washington, DC 20590–0001, telephone communications and comments order; (202) 366–8553. received into any of our dockets by the (2) Under the entry ‘‘American All comments should be addressed to name of the individual submitting the Society for Testing and Materials,’’, the the Dockets Unit as identified in the document (or signing the document, if entry for ASTM Standard A 607–98 is ADDRESSES section of this rulemaking, submitted on behalf of an association, removed and two new standards are and received prior to the close of the business, labor union, etc.). You may added in appropriate numerical order; comment period identified in the DATES review DOT’s complete Privacy Act (3) Under the entry ‘‘Chlorine section of this rulemaking. In addition, Statement in the Federal Register Institute, Inc.’’, the entries for Chlorine you may submit comments specifically published on April 11, 2000 (65 FR Institute Emergency Kit ‘‘A’’ and ‘‘B’’ related to the information collection 19477) or you may visit http:// are revised; burden to the RSPA Desk Officer, OMB, dms.dot.gov. (4) Under the entry ‘‘Department of at fax number 202–395–6974. Under the Defense (DOD),’’ a new entry is added List of Subjects Paperwork Reduction Act of 1995, no in appropriate alphabetical order; and person is required to respond to an 49 CFR Part 171 (5) Under the entry ‘‘Transport information collection unless it displays Canada,’’ the entry is revised. a valid OMB control number. Exports, Hazardous materials b. In the paragraph (b) table, the entry transportation, Hazardous waste, ‘‘National Association of Corrosion F. Regulation Identifier Number (RIN) Imports, Incorporation by reference, Engineers’’ is removed. A regulation identifier number (RIN) Reporting and recordkeeping The revisions and additions read as is assigned to each regulatory action requirements. follows:
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§ 171.7 Reference material. (c) Table of material incorporated by (a) * * * reference. ***
Source and name of material 49 CFR reference
******* American Institute of Chemical Engineers, 3 Park Avenue, New York, NY 10016–5991, AICChE Process Safety Progress Journal, June 2002, issue (Vol. 21, No. 2), An Example of a Text Method for Vent Sizing—OPPSD/SPI Methodology ...... 173.225
******* American Society for Testing and Materials,
******* ASTM A 1008/A 1008M—03 Standard Specification for Steel, Sheet, Cold-Rolled, Carbon, Structural, High- Strength Low-Alloy and High Strength Low-Alloy with Improved Formability ...... 178.338–2; 178.345–2 ASTM A 1011/A 1011M—03a Standard Specification for Steel, Sheet and Strip, Hot-Rolled, Carbon, Structural, High-Strength Low Alloy and High Strength Low-Alloy with Improved Formability ...... 178.338–2; 178.345–2
******* The Chlorine Institute, Inc.,
******* Chlorine Institute Emergency Kit ‘‘A’’ for 100-lb. & 150 lb. Chlorine Cylinders (with the exception of repair method using Device 8 for side leaks), Edition 10, June 2003 ...... 173.3 Chlorine Institute Emergency Kit ‘‘B’’ for Chlorine Ton Containers (with the exception of repair method using De- vice 9 for side leaks), Edition 9, June 2003 ...... 173.3
******* Department of Defense, (DOD),
******* Packaging of Hazardous Material, DLAD 4145.41/AR 700–143/AFJI 24–210/NAVSUPINST 4030.55B/MCO 4030.40B ...... 173.7
******* Transport Canada,
******* Transportation of Dangerous Goods (TDG) Regulations, August 2001 including Clear Language Amendments SOR/2001–286, and Amendment 1 SOR/2002–306), Amendment 2 (SOR/2003–273), and Amendment 3 (SOR/2003–400) ...... 171.12a; 172.401; 172.502; 172.519; 172.602; 173.301.
*******
§ 171.8 [Amended] highway or rail) may not be transported § 172.101 Purpose and use of the 3. In § 171.8, the definition for under the provisions of this section. hazardous materials table. ‘‘Materials of trade’’ is amended by * * * * * * * * * * removing the wording ‘‘in direct (i) * * * support of a principal business that is § 171.14 [Amended] other than transportation by motor 5. In § 171.14, paragraph (d)(3) is (3) * * * Column 8C specifies the vehicle’’. removed and reserved. section in part 173 of this subchapter 4. In § 171.12a, paragraph (b)(2) is which prescribes packaging revised to read as follows: PART 172—HAZARDOUS MATERIALS requirements for bulk packagings, TABLE, SPECIAL PROVISIONS, subject to the limitations, requirements § 171.12a Canadian shipments and HAZARDOUS MATERIALS packagings. and additional authorizations of COMMUNICATIONS, EMERGENCY Columns 7 and 8B. A ‘‘None’’ in * * * * * RESPONSE INFORMATION, AND Column 8C means bulk packagings are (b) * * * TRAINING REQUIREMENTS (2) A material designated as a not authorized, except as may be provided by special provisions in hazardous material under this 6. The authority citation for part 172 subchapter which is not subject to the continues to read as follows: Column 7 and in Column 8B. * * * requirements of the TDG Regulations or * * * * * is afforded hazard communication or Authority: 49 U.S.C. 5101–5127, 44701; 49 CFR 1.53. (5) Cylinders. For cylinders, both non- packaging exceptions not authorized in bulk and bulk packaging authorizations this subchapter (e.g., paragraph 1.16 of 7. In § 172.101, the first and second are set forth in Column 8B. the TDG Regulations excepts quantities sentence in paragraph (i)(3), are revised of hazardous materials less than or and a new paragraph (i)(5) is added to Notwithstanding a designation of equal to 500 kg gross transported by read as follows: ‘‘None’’ in Column 8C, a bulk cylinder
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may be used when specified through the 8. In § 172.101, the Hazardous appropriate alphabetical sequence, the section reference in Column 8B. Materials Table is amended by following entries to read as follows: * * * * * removing, adding and revising, in the
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ABLE T Packaging ( Exceptions Non-bulk Bulk None ...... 226 ...... 249 ...... Forbidden ForbiddenNone ...... 226 ...... 12, 40, 66, 249 ...... Forbidden Forbidden D ...... 12, 40, 66, 150 ...... 202 ...... 242 ...... 5 L ...... 60 L ...... B ...... None ...... 226 ...... 249 ...... Forbidden Forbidden D ...... 12, 40, 66, None ...... 201 ...... 243 ...... 1 L ...... 30 L ...... E ...... 150 ...... 203 ...... 242 ...... 60 L ...... 220 L ...... A ...... None ...... 227 ...... 249 ...... Forbidden Forbidden D ...... 12, 40, 66, None ...... 227 ...... 244 ...... Forbidden Forbidden A ...... 12, 13, 22, None ...... 227 ...... 244 ...... Forbidden Forbidden A ...... 12, 13, 22, ATERIALS M ...... 150 ...... 203 ...... 242 ...... 60L ...... 220L ...... A ...... 1, TP8, , TP1, 172.102) § ( AZARDOUS H Special provisions N34, N43, T22, TP2, TP10, TP12, TP13. N43, T22, TP2, TP10, TP12, TP13. TP28. N43, T22, TP2, TP10, TP12, TP13. TP27. TP29. N43, T22, TP2, TP10, TP12, TP13. T20, TP4, TP12, TP13, TP38, TP45. T20, TP4, TP12, TP13, TP38, TP45. — Label codes 172.101. § PG bers tion num- Identifica- ******* ******* ******* ******* ******* ******* ******* ******* ******* ******* Hazard class or division 8 ...... UN1744 I ...... 8, 6.1 ...... 1, A3, A6, B9, B64, B85, 8 ...... UN1744 I ...... 8, 6.1 ...... 1, B9, B64, B85, N34, 3 ...... UN1987 I ...... 3 ...... 172, T11, TP1, TP8, 8 ...... UN1744 I ...... 8, 6.1 ...... 2, B9, B64, B85, N34, 3 ...... NA1987 II ...... 3 ...... 172,T8, T31 ...... 150 ...... 202 ... 6.1 ...... NA2742 I ...... 6.1, 3, 8 .... 2, B9, B14, B32, B74, 6.1 ...... NA2742 I ...... 6.1, 3, 8 .... 2, B9, B14, B32, B74,
or names shipping Bromine solutions. lutions. n.o.s. lutions. alcohol. chlorofor- mate. chlorofor- mate. materials Hazardous and proper descriptions ...... III ...... 3 ...... 172, B1, IB3, T4 ...... II ...... 3 ...... 172, 1B2, T7, TP ...... III ...... 3 ...... 172, B1, T7, T30 [REMOVE:] [ADD:] [REVISE:] Alcohols, + Bromine + Bromine ...... 8 ...... UN1744 I ...... 8, 6.1 ...... 1, B9, B64, B85, N34, + Bromine so- + Bromine so- D Denatured D Isobutyl D Sec-Butyl (1) (2) (1) (3) (4) (5) (6) (7) (10B) (10A) (9A) (9B) (8C) (8A) (8B) bols Sym-
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9. In § 172.102, in paragraph (c)(1), PART 173—SHIPPERS—GENERAL relief devices are given in Appendix 5 of the Special revision 53, the first sentence is REQUIREMENTS FOR SHIPMENTS UN Manual of Tests and Criteria (IBR, see revised and new Special provision 172 AND PACKAGINGS § 171.7 of this subchapter) and AIChE is added in appropriate numerical order Process Safety Progress Journal, Vol. 21, No. to read as follows: 14. The authority citation for part 173 2 (IBR, see § 171.7 of this subchapter). continues to read as follows: § 172.102 Special provisions. * * * * * Authority: 49 U.S.C. 5101–5127, 44701; 49 * * * * * CFR 1.45, 1.53. § 173.241 [Amended] (c) * * * 20. In § 173.241, paragraph (c) is § 173.7 [Amended] (1) * * * amended by adding a new last sentence 53 Packages of these materials must 15. In § 173.7, paragraph (a), the to read as follows: bear the subsidiary risk label, wording ‘‘Performance Oriented ‘‘EXPLOSIVE’’, and the subsidiary Packaging of Hazardous Material, DLAR § 173.241 Bulk packagings for certain low hazard class/division must be entered in 4145.41/AR 700–143/AFR 71–5/ hazard liquid and solid materials. parentheses immediately following the NAVSUPINST 4030.55/MCO 4030.40’’ * * * * * primary hazard class in the shipping is removed and the wording ‘‘Packaging (c) * * * For transportation of description, unless otherwise provided of Hazardous Material, DLAD 4145.41/ combustible liquids by vessel, in this subchapter or through an AR 700–143/AFJI 24–210/ additional requirements are specified in approval issued by the Associate NAVSUPINST 4030.55B/MCO 4030.40B § 176.340 of this subchapter. Administrator, or the competent (IBR, see § 171.7 of this subchapter)’’ is * * * * * authority of the country of origin. * * * added in its place. 21. In § 173.301, paragraphs (a)(9), * * * * * 16. In § 173.28, paragraph (b)(3) is (l)(2) and (m) introductory text are 172 This entry includes alcohol revised to read as follows: revised to read as follows: mixtures containing up to 5% § 173.28 Reuse, reconditioning and petroleum products. § 173.301 General requirements for remanufacture of packagings. shipment of compressed gases in cylinders * * * * * * * * * * and spherical pressure vessels. 10. In § 172.203, a new paragraph (b) * * * (l)(4) is added to read as follows: (a) * * * (3) Packagings made of paper (other (9) Specification 2P, 2Q, 3E, 3HT, § 172.203 Additional description than fiberboard), plastic film, or textile spherical 4BA, 4D, 4DA, 4DS, and 39 requirements. are not authorized for reuse; cylinders must be packed in strong non- * * * * * * * * * * bulk outer packagings. The outside of (l) * * * 17. In § 173.31, paragraph (b)(5), the the combination packaging must be (4) Except when transported aboard second sentence is revised to read as marked with an indication that the vessel, marine pollutants in non-bulk follows: inner packagings conform to the packagings are not subject to the § 173.31 Use of tank cars. prescribed specifications. requirements of this subchapter (see * * * * * § 171.4 of this subchapter). * * * * * (b) * * * (l) * * * * * * * * (5) * * * Tank cars not requiring (2) In addition to other requirements 11. In § 172.205, a new paragraph (i) bottom-discontinuity protection under of this subchapter, the maximum filling is added to read as follows: the terms of Appendix Y of the AAR density, service pressure, and pressure § 172.205 Hazardous waste manifest. Specifications for Tank Cars as of July relief device for each cylinder conform 1, 1996, must conform to these to the requirements of this part for the * * * * * gas involved. (i) The shipping description for a requirements no later than July 1, 2006, hazardous waste must be modified as except that tank cars transporting a * * * * * required by § 172.101(c)(9). material that is hazardous only because (m) Canadian cylinders in domestic 12. In § 172.504, paragraph (g)(2) is it meets the definition of an elevated use. A Canadian Transport Commission revised to read as follows: temperature material or because it is (CTC) specification cylinder molten sulfur do not require bottom manufactured, originally marked and § 172.504 General placarding discontinuity protection. * * * approved in accordance with the CTC requirements. * * * * * regulations and in full conformance * * * * * with the Canadian Transport of (g) * * * § 173.150 [Amended] Dangerous Goods (TDG) Regulations (2) Explosive articles of compatibility 18. In § 173.150, paragraph (f)(1) is (IBR, see § 171.7 of this subchapter) is groups C, D, or E, when transported removed and paragraphs (f)(2), (f)(3) and authorized for the transportation of a with those in compatibility group N, (f)(4) are redesignated as (f)(1), (f)(2) and hazardous material to, from or within may be placarded displaying (f)(3) respectively. the United States under the following compatibility group D. 19. In § 173.225, the Note to conditions: * * * * * paragraph (e)(3)(vi) is revised to read as * * * * * follows: § 172.519 [Amended] 22. In § 173.302a, new paragraph (e) is added and paragraph (a)(3) and the first 13. In § 172.519, in paragraph (f), the § 173.225 Packaging requirements and sentence in paragraph (d) are revised to wording ‘‘the ICAO Technical other provisions for organic peroxides. read as follows: Instructions, the IMDG Code, or the * * * * * TDG Regulations,’’ is removed and the (e) * * * § 173.302a Additional requirements for wording ‘‘the ICAO Technical (3) * * * shipment of non-liquefied (permanent) Instructions, the IMDG Code, or the (vi) * * * compressed gases in specification TDG Regulations (IBR, see § 171.7 of Note To Paragraph (e)(3)(vi): Examples of cylinders. this subchapter),’’ is added in its place. methods to determine the size of emergency- * * * * *
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(a) * * * n. For the entry PART 178—SPECIFICATIONS FOR (3) DOT 39 cylinders. When the ‘‘Trifluorochloroethylene, stabilized’’, PACKAGINGS cylinder is filled with a Division 2.1 remove the phrase ‘‘DOT–4A300;’’. material, the internal volume of the 24. In § 173.314, paragraph (g)(1) is 28. The authority citation for part 178 cylinder may not exceed 1.23 L (75 in3). revised to read as follows: continues to read as follows: * * * * * Authority: 49 U.S.C. 5101–5127; 49 CFR § 173.314 Compressed gases in tank cars 1.53. (d) * * * Diborane and diborane and multi-unit tank cars. 29. In § 178.338–2, paragraph (a), the mixed with compatible compressed gas * * * * * last sentence is revised to read as must be offered in a DOT 3AL1800 or (g) * * * 3AA1800 cylinder. * * * (1) The shipper shall notify the follows: (e) Fluorine. Fluorine must be Federal Railroad Administration § 178.338–2 Material. shipped in specification 3A1000, whenever a tank car is not received by (a) * * * All material used for 3AA1000, or 3BN400 cylinders without the consignee within 20 days from the evacuated jacket pressure parts must pressure relief devices and equipped date of shipment. Notification to the conform to the chemistry and with valve protection cap. The cylinder Federal Railroad Administration may be steelmaking practices of one of the may not be charged to over 400 psig at made by e-mail to [email protected] ° ° material specifications of Section II of 21 C (70 F) and may not contain over or telephone call to (202) 493–6229. the ASME Code or the following ASTM 2.7 kg (6 lbs) of gas. * * * * * Specifications: A 242, A 441, A514, 23. In § 173.304a, in the paragraph 25. In § 173.315, in the paragraph (a) A572, A 588, A 606, A 633, A 715, (a)(2) table, in column 1, for the entry table, column 4, amend the entry A1008/A 1008M, A 1011/A 1011M. ‘‘Methyl acetylene-propadiene, ‘‘Ammonia, anhydrous or Ammonia * * * * * mixtures, stabilized’’ remove the phrase solutions with greater than 50% ‘‘DOT–3A240’’; and in column 3 make ammonia’’ by removing the wording § 178.345–2 [Amended] the following changes: ‘‘Notes 12 and 17’’ and adding the 30. In § 178.345–2, paragraph (a)(1), a. For the entry ‘‘Anhydrous wording ‘‘Notes 12, 17 and 27’’ in its the wording ‘‘ASTM A 607’’ is removed ammonia’’, remove the phrases ‘‘DOT– place and following the table, add Note and the wording ‘‘ASTM A 1008/ A 4;’’ and ‘‘DOT–4A480;’’; 27 in the appropriate numerical order to 1008M, ‘‘ASTM A 1011/A 1011M’’ is b. For the entry read as follows: added in the appropriate numerical ‘‘Bromotrifluoromethane’’, remove the order. phrase ‘‘DOT–4A400;’’ and correct the § 173.315 Compressed gases in cargo entry ‘‘DOT–3AL40’’ to read ‘‘DOT– tanks and portable tanks. § 178.606 [Amended] 3AL400.’’; * * * * * 31. In § 178.606, in paragraph c. For the entry (a) * * * (c)(2)(ii), make the following changes: ‘‘Chlorodifluoromethane -22)’’, Note 27: Non-specification cargo tanks may a. For the formula, remove the ¥ remove the phrase ‘‘DOT–41;’’; be used for transportation of Ammonia, wording ‘‘Solids: A = (n 1) [w + (s anhydrous and ammonia solutions with × v × 8.3 × .95) × 1.5’’ and add the d. For the entry ¥ × ‘‘Chloropentafluorethane -115)’’, greater than 50% ammonia, subject to the wording ‘‘Solids: A = (n 1) (m 1.5)’’ conditions prescribed in paragraph (m) of remove the phrase ‘‘DOT–4A225;’’; in its place; and this section. b. In the definitions following the e. For the entry ‘‘Cyclopropane’’, formula, add the wording ‘‘m=the remove the phrase ‘‘DOT–4A225;’’; * * * * * certified maximum gross mass for the f. For the entry 26. In § 173.319, paragraph (a)(3) is revised to read as follows: container in kilograms;’’ in appropriate ‘‘Dichlorodifluoromethane -12)’’, alphabetical order. remove the phrases ‘‘DOT–4A225;’’, § 173.319 Cryogenic liquids in tank cars. ‘‘DOT–9;’’ and ‘‘DOT–41;’’; PART 179—SPECIFICATIONS FOR g. For the entry * * * * * (a) * * * TANK CARS ‘‘Dichlorodifluoromethane and (3) The shipper shall notify the difluoroethane mixture (constant boiling 32. The authority citation for part 179 Federal Railroad Administration mixture) (R–500)’’, remove the phrases continues to read as follows: whenever a tank car containing any ‘‘DOT–4A240;’’ and ‘‘DOT–9;’’; Authority: 49 U.S.C. 5101–5127; 49 CFR flammable cryogenic liquid is not part 1.53. h. For the entry ‘‘Hydrogen sulfide’’, received by the consignee within 20 remove the phrase ‘‘DOT–4A480;’’; days from the date of shipment. 33. In § 179.200–7, paragraph (e), the i. For the entry ‘‘Insecticide, gases Notification to the Federal Railroad first sentence is revised to read as liquefied’’, remove the phrases ‘‘DOT–9; Administration may be made by e-mail follows: DOT–40;’’ and ‘‘DOT–41;’’; to [email protected] or telephone § 179.200–7 Materials. j. For the entry ‘‘Methyl acetylene- call to (202) 493–6229. propadiene, mixtures, stabilized’’, * * * * * * * * * * (e) Nickel plate. Nickel plate must remove the phrase ‘‘DOT–4; DOT–41;’’; 27. In § 173.337, introductory text, the k. For the entry ‘‘Methyl chloride’’, comply with the following specification first sentence is revised to read as (IBR, see § 171.7 of this subchapter): remove the phrases ‘‘DOT–4A225;’’ follows: ‘‘DOT–4; DOT–38;’’ and ‘‘DOT– *** 4A150;’’; § 173.337 Nitric oxide. * * * * * l. For the entry ‘‘Refrigerant gas, n.o.s. Nitric oxide must be packed in DOT PART 180—CONTINUING or Dispersant gas, n.o.s.’’, remove the 3A1800, 3AA1800, 3E1800, or 3AL1800 QUALIFICATION AND MAINTENANCE phrases ‘‘DOT–4A240;’’ and ‘‘DOT–9;’’; cylinders charged to a pressure of not OF PACKAGINGS m. For the entry ‘‘Sulfur dioxide’’, more than 5,170 kPa (750 psig) at 21 °C remove the phrases ‘‘DOT–4A225;’’ and (70 °F) and conforming to the 34. The authority citation for part 180 ‘‘DOT–4; DOT–38;’’; requirements in § 173.40. * * * continues to read as follows:
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Authority: 49 U.S.C. 5101–5127; 49 CFR (1) The removal and replacement of a DEPARTMENT OF COMMERCE 1.53. neck ring or foot ring on a DOT 3A, 35. In § 180.205, paragraphs (c)(2)(I), 3AA, or 3B cylinder that does not affect National Oceanic and Atmospheric (I)(2) and (I)(3) are revised to read as a pressure part of the cylinder when Administration follows: performed by a repair facility or a 50 CFR Part 635 § 180.205 General requirements for cylinder manufacturer of these types of requalification of cylinders. cylinders. The repair may be made by [Docket No. 040726216–4216–01; I.D. 070804B] * * * * * welding or brazing in conformance with (c) * * * the original specification. After removal RIN 0648–AS49 (2) * * * and before replacement, the cylinder (i) Rejected and may be repaired or must be visually inspected and Atlantic Highly Migratory Species; rebuilt in accordance with § 180.211 or defective cylinders must be rejected. Reducing Sea Turtle Interactions With 180.212, as appropriate; or The heat treatment, testing and Fishing Gear inspection of the repair under the * * * * * AGENCY: National Marine Fisheries (i) * * * supervision of an inspector must be Service (NMFS), National Oceanic and (2) When a cylinder must be performed in accordance with the Atmospheric Administration (NOAA), condemned, the requalifier must — original specification. (i) Stamp a series of X’s over the DOT Commerce. specification number and the marked (2) External re-threading of a DOT ACTION: Advance notice of proposed pressure or stamp ‘‘CONDEMNED’’ on 3AX, 3AAX or 3T cylinder or internal rulemaking (ANPR); request for the shoulder, top head, or neck using a re-threading of a DOT–3 series cylinder comments. steel stamp; to restore the total number of neck SUMMARY: (ii) For composite cylinders, securely threads engaged to the condition NMFS is considering affix a label with the word specified in the applicable specification. adjustments to the regulations governing ‘‘CONDEMNED’’, overcoated with The repair work must be performed by the Atlantic highly migratory species epoxy near but not obscuring the the original manufacturer of the (HMS) pelagic longline fishery based original manufacturer’s label, to the cylinder. Upon completion of the re- upon a June 1, 2004, Biological Opinion (2004 BiOp) regarding Atlantic sea cylinder; or threading, the threaded opening must be turtles. NMFS issues this ANPR to (iii) As an alternative to the stamping inspected by an independent inspection or labeling as described in this request comments on potential agency and gauged in accordance with regulatory changes to further reduce paragraph (I)(2), at the direction of the Federal Standard H–28 or an equivalent owner, the requalifier may render the bycatch and bycatch mortality of sea standard containing the same turtles in the Atlantic pelagic longline cylinder incapable of holding pressure. specification limits. The re-threaded (3) No person may remove or fishery as well comments on as the cylinder must be stamped clearly and obliterate the ‘‘CONDEMNED’’ marking. feasibility of framework mechanisms to In addition, the requalifier must notify legibly with the words ‘‘RETHREAD’’ on address unanticipated increases in sea the cylinder owner, in writing, that the the shoulder, top head, or neck. No turtle interactions and mortalities, cylinder is condemned and may not be cylinder may be re-threaded more than should they occur. filled with hazardous material and one time without approval of the DATES: Written comments on this ANPR offered for transportation in commerce Associate Administrator. must be received no later than October where use of a specification packaging 37. In § 180.417, paragraph (b)(2)(v) is 12, 2004. is required. revised to read as follows: ADDRESSES: You may submit comments 36. A new section 180.212 is added to by any of the following methods: read as follows: § 180.417 Reporting and record retention ∑ Email: [email protected]. requirements. § 180.212 Repair of DOT–3 series Include in the subject line the following specification cylinders. * * * * * identifier: I.D. 070804B. ∑ (a) General requirements for repair of (b) * * * Federal e-Rulemaking Portal: http:// www.regulations.gov. DOT 3 series cylinders. No person may (2) * * * ∑ repair a DOT 3-series cylinder unless Mail: Christopher Rogers, Chief, prior approval has been obtained in (v) ASME or National Board Highly Migratory Species Management accordance with this section. The repair Certificate of Authorization number of Division (F/SF1), NMFS, 1315 East-West facility performing repairs, if applicable; Highway, Silver Spring, MD 20910. facility must hold an approval as ∑ specified in § 107.805 of this * * * * * Fax: (301)713–1917. Related documents, including the subchapter. The repair and the Issued in Washington, DC on August 5, 2004 BiOp, are available upon request at inspection must conform to the 2004, under authority delegated in 49 CFR the mailing address noted above or on requirements of the applicable cylinder part 106. specification contained in part 178 of the HMS Management Division’s web Robert A. McGuire, this subchapter and, except as provided page at: http://www.nmfs.noaa.gov/sfa/ in paragraph (b) of this section, the Associate Administrator for Hazardous hms. In addition, the main resource provisions of an approval issued under Materials Safety. laws that guide NMFS can be found at subpart H of Part 107 of this subchapter. [FR Doc. 04–18357 Filed 8–11–04; 8:45 am] www.nmfs.noaa.gov/legislation.htm. The person performing the repair must BILLING CODE 4910–60–P FOR FURTHER INFORMATION CONTACT: prepare a report containing, at a Russell Dunn, 727–570–5447; fax: 727– minimum, the results prescribed in 570–5656. § 180.215. SUPPLEMENTARY INFORMATION: The (b) Repairs not requiring prior Atlantic tuna and swordfish fisheries approval. Approval is not required for are managed under the authority of the the following specific repairs: Magnuson-Stevens Fishery
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Conservation and Management Act announces its intent to undertake based on observed, estimated, or (Magnuson-Stevens Act) and the additional rulemaking and non- reported takes. NMFS may also consider Atlantic Tunas Convention Act (ATCA). regulatory actions, as necessary, to additional modifications to existing Atlantic sharks are managed under the implement requirements of the 2004 hook and bait configurations or the authority of the Magnuson-Stevens Act. BiOP to ensure that the mortality targets turtle release gear, as more information The Fishery Management Plan for and ITS are not met nor exceeded. is collected and analyzed. These types Atlantic Tunas, Swordfish, and Sharks The PLL fishery is currently operating of management measures could reduce (HMS FMP)and Amendment 1 to the under the ITS level specified in the fishing effort and/or improve post- Atlantic Billfish Fishery Management 2004 BiOp; thus, no corrective actions release survival in order to ensure that Plan are implemented by regulations at are needed at this time. However, the the ITS specified in the 2004 BiOp is 50 CFR part 635. The Atlantic pelagic 2004 BiOp advises consideration of a not exceeded. longline (PLL) fishery for these HMS is framework mechanism to facilitate more also subject to the requirements of the timely implementation of corrective Request for Comments Endangered Species Act (ESA) and the actions and to provide greater certainty NMFS requests comments on possible Marine Mammal Protection Act on potential management responses. changes to the current regulations (MMPA). Thus, in this ANPR, NMFS is exploring regarding fishing for Atlantic HMS with a potential mechanism and/or Background pelagic longline gear. Specifically, individual corrective actions that might NMFS requests comments on individual NMFS announced the availability of a be necessary if any exceedance occurs. or framework actions, including those Final Supplementary Environmental Potential Management Measures described above, to ensure that Impact Statement (FSEIS) concerning mortality targets and the ITS specified the reduction of sea turtle bycatch and If sea turtle interactions and/or in the BiOp are not met nor exceeded. bycatch mortality in the Atlantic PLL mortality exceed anticipated levels, the In addition, NMFS also requests fishery on June 25, 2004 (69 FR 35599), 2004 BiOp specifies that corrective comments on any other possible and subsequently published a final rule measures should be taken. As described regulatory changes that might further below, such actions could include time/ on July 6, 2004 (69 FR 40734)to minimize sea turtle bycatch or bycatch area closures, additional gear implement management measures to mortality. reduce bycatch and bycatch mortality of modifications or gear restrictions, Written comments received by the Atlantic sea turtles in the Atlantic PLL improvements in gear removal tool due date will be considered in drafting fishery. That rulemaking was based on design, training program adjustments, or any proposed changes to the Atlantic the results of the 3–year Northeast any other action that is deemed HMS regulations. In developing any Distant (NED) Closed Area research appropriate. The goal of any of these proposed regulations, NMFS will need experiment involving interactions of management measures would be to to consider and analyze the ecological PLL fishing gear and Atlantic sea turtles, ensure that total sea turtle takes do not impacts of any actions under other available studies and information exceed long-term average take rates over on circle hook and bait treatments, and 3–year periods. These measures may be consideration with regards to target public comments. considered individually or as an species and protected species, such as A 2004 BiOp issued for the Atlantic overarching framework that would give sea turtles, and other possible PLL fishery found that the measures that NMFS the ability to adjust the environmental effects. NMFS will also subsequently were included in the final management measures, as appropriate, need to analyze the social and economic rule were not likely to jeopardize the in order to reduce sea turtle bycatch and impacts of any changes to the fishery continued existence of loggerhead, bycatch mortality, per the 2004 BiOp. and related industries. To that end, green, hawksbill, Kemp’s ridley, or olive If the ITS is expected to be exceeded, NMFS would appreciate any comments ridley sea turtles, but were likely to potential time/area closures could that include information that would aid jeopardize the continued existence of include modifications to existing in those analyses. For example, leatherback sea turtles. The 2004 BiOp closures or the addition of partial, comments could address how different also identified a Reasonable and rolling or permanent closures. NMFS types of regulatory measures may affect Prudent Alternative necessary to avoid may also consider establishing Dynamic sea turtles or the PLL fishery. From the jeopardy, and contained an Incidental Area Management protocols similar to resource perspective, comments could Take Statement (ITS) for the PLL that those established under the Atlantic address regulatory measures that would specifies the maximum authorized Large Whale Take Reduction Plan. Any further protect sea turtles. Comments number of interactions with sea turtles. of these types of closures could act to could also address how the PLL fishery Among other actions, the 2004 BiOp remove effort from areas where and may be impacted, both strategically and specifies that NMFS review quarterly when a large number of sea turtle economically, by any changes that and annually sea turtle take estimates, interactions are likely to occur in order would further protect sea turtles, and and, should these estimates indicate to reduce the number of sea turtle suggest measures that would protect sea that the PLL fishery is not likely to stay interactions. turtles but yet be compatible with the within the authorized 3–year take levels Additional potential management PLL fishery, or suggest measures that specified in the 2004 BiOp, NMFS shall measures to prevent exceeding the would minimize any unavoidable take corrective action to avoid long-term mortality targets or ITS could include negative impacts on the fishery. elevations in sea turtle interactions and limits on fishing effort including Relevant data or other information ensure that the ITS is not exceeded. limiting the number of sets fishery- could be included in support of these Additionally, NMFS must monitor sea wide, the number of sets per trip, the comments. turtle post-hooking mitigation and number of hooks per set, or the number Classification release, and take corrective action to of trips per year or quarter. In addition, reduce mortalities if fleet-wide gear NMFS may consider options to close the This action is significant pursuant to removal rates are not sufficient to meet fishery for the month, quarter, fishing Executive Order 12866. mortality performance targets contained season, or year if a certain number of sea Authority: 16 U.S.C. 971 et seq. and 1801 in the 2004 BiOp. In this notice, NMFS turtles are taken per set, trip, or quarter et seq.
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Dated: August 9, 2004. Rebecca Lent, Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service. [FR Doc. 04–18474 Filed 8–11–04; 8:45 am] BILLING CODE 3510–22–S
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Notices Federal Register Vol. 69, No. 155
Thursday, August 12, 2004
This section of the FEDERAL REGISTER DEPARTMENT OF AGRICULTURE purpose of the conference call is to contains documents other than rules or discuss the scope of the SAC’s current proposed rules that are applicable to the Forest Service civil rights project idea and arrive at an public. Notices of hearings and investigations, outline for the project proposal. committee meetings, agency decisions and Ketchikan Resource Advisory This conference call is available to the rulings, delegations of authority, filing of Committee petitions and applications and agency public through the following call-in statements of organization and functions are AGENCY: Forest Service, USDA. number: 1–800–497–7708, access code: examples of documents appearing in this ACTION: Notice of meeting. 25514714. Any interested member of the section. public may call this number and listen SUMMARY: The Ketchikan Resource to the meeting. Callers can expect to Advisory Committee will meet in incur charges for calls not initiated DEPARTMENT OF AGRICULTURE Ketchikan, Alaska, September 23, 2004, using the supplied call-in number or and November 18, 2004. The purpose of over wireless lines, and the Commission Food and Nutrition Service these meetings is to discuss potential will not refund any incurred charges. projects under the Secure Rural Schools Callers will incur no charge for calls National Advisory Council on Maternal, and Community Self-Determination Act using the call-in number over land-line Infant and Fetal Nutrition; Notice of of 2000. connections. Persons with hearing Meeting DATES: The meetings will be held impairments may also follow the September 23, 2004, and November 18, proceedings by first calling the Federal AGENCY: Food and Nutrition Service, 2004. Relay Service at 1–800–977–8339 and USDA. ADDRESSES: The meetings will be held at providing the Service with the ACTION: Notice. the Southeast Alaska Discovery Center conference call number and access code Learning Center (back entrance), 50 number. SUMMARY: Pursuant to the Federal Main Street, Ketchikan, Alaska. Send To ensure that the Commission Advisory Committee Act, 5 U.S.C. App. written comments to Ketchikan secures an appropriate number of lines II, this notice announces a meeting of Resource Advisory Committee, c/o for the public, persons are asked to register by contacting Aonghas St- the National Advisory Council on District Ranger, USDA Forest Service, Hilaire of the Eastern Regional Office, Maternal, Infant and Fetal Nutrition. 3031 Tongass Ave., Ketchikan, AK 99901, or electronically to 202–376–7533 (TTY 202–376–8116), by DATES: September 8–10, 2004, 9 a.m.–5 [email protected]. 4 p.m. on Wednesday, August 18, 2004. p.m. The meeting will be conducted FOR FURTHER INFORMATION CONTACT: Jerry pursuant to the provisions of the rules ADDRESSES: The meeting will be held at Ingersoll, District Ranger, Ketchikan- and regulations of the Commission. the Food and Nutrition Service, 3101 Misty Fiords Ranger District, Tongass Park Center Drive, Conference Room National Forest, (907) 228–4100. Dated at Washington, DC August 6, 2004. Ivy L. Davis, 204–B, Alexandria, Virginia 22302. SUPPLEMENTARY INFORMATION: The Chief, Regional Programs Coordination Unit. FOR FURTHER INFORMATION CONTACT: Lisa meetings are open to the public. [FR Doc. 04–18452 Filed 8–11–04; 8:45 am] Christie, Supplemental Food Programs Committee discussion is limited to Division, Food and Nutrition Service, Forest Service staff and Committee BILLING CODE 6335–01–P Department of Agriculture, (703) 305– members. However, public input 2746. opportunity will be provided and individuals will have the opportunity to DEPARTMENT OF COMMERCE SUPPLEMENTARY INFORMATION: The address the Committee at that time. Council will continue its study of the Dated: August 5, 2004. International Trade Administration Special Supplemental Nutrition Forrest Cole, Program for Women, Infants and [A–427–801, A–428–801, A–475–801, A–588– Forest Supervisor. Children, and the Commodity 804, A–559–801, A–412–801] Supplemental Food Program. The [FR Doc. 04–18439 Filed 8–11–04; 8:45 am] agenda items will include a discussion BILLING CODE 3410–11–M Antifriction Bearings and Parts Thereof of general program issues. Meetings of From France, Germany, Italy, Japan, the Council are open to the public. Singapore, and the United Kingdom: Members of the public may participate, COMMISSION ON CIVIL RIGHTS Extension of Time Limit for Final as time permits. Members of the public Results of Antidumping Duty Agenda and Notice of Public Meeting Administrative Reviews may file written statements with the of the New York Advisory Committee contact person named above, before or AGENCY: Import Administration, after the meeting. Notice is hereby given, pursuant to International Trade Dated: August 5, 2004. the provisions of the rules and Administration,Department of regulations of the U.S. Commission on Commerce. Roberto Salazar, Civil Rights, that a conference call of the ACTION: Notice of extension of time limit Administrator. New York Advisory Committee will for final results of antidumping duty [FR Doc. 04–18470 Filed 8–11–04; 8:45 am] convene at 12 p.m. and adjourn at 1 administrative reviews. BILLING CODE 3410–30–P p.m., Thursday, August 19, 2004. The
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SUMMARY: The Department of Commerce of an antidumping duty administrative Background is extending the time limit for the final review within 120 days of the date on On March 23, 2004, the Department results of the administrative reviews of which the preliminary results are initiated antidumping duty the antidumping duty orders on published. The administering authority investigations of imports of certain antifriction bearings and parts thereof may extend the period of time for circular welded carbon quality line pipe from France, Germany, Italy, Japan, making a final determination without (‘‘line pipe’’) from Mexico, the Republic Singapore, and the United Kingdom. extending the time for making a of Korea (‘‘Korea’’), and the PRC. See The final results of these reviews are preliminary determination, if such Notice of Initiation of Antidumping now due September 8, 2004. determination is made no later than 300 Duty Investigations: Certain Circular EFFECTIVE DATE: August 12, 2004. days after the date on which the Welded Carbon Quality Line Pipe from FOR FURTHER INFORMATION CONTACT: preliminary determination is published. Mexico, the Republic of Korea, and the Susan Lehman or Richard Rimlinger, Completion of the final results of these People’s Republic of China, 69 FR 16521 AD/CVD 5, Import Administration, reviews within the previously-extended (March 30, 2004) (‘‘Initiation Notice’’). International Trade Administration, period is not practicable because of the Section 733(b) of the Act requires the U.S. Department of Commerce, 14th large number of respondents and the Department to make a preliminary Street and Constitution Avenue, NW., complexity of the issues raised in these determination no later than 140 days Washington, DC 20230; telephone: (202) reviews. Therefore, we are extending the after the date of initiation. On July 21, 482–0180 and (202) 482–4477, time period for issuing the final results 2004, the Department extended the respectively. of these reviews by 30 days, until preliminary determinations of the line September 8, 2004. SUPPLEMENTARY INFORMATION: pipe investigations for Mexico and This notice is published in Korea in accordance with section Background accordance with section 751(a)(3)(A) of 733(c)(1)(B) of the Act. See At the request of interested parties, the Act and 19 CFR 351.213(h)(2). Postponement of Preliminary the Department of Commerce initiated Dated: August 5, 2004. Determinations of Antidumping Duty administrative reviews of the Jeffrey May, Investigations: Certain Circular Welded antidumping duty orders on antifriction Deputy Assistant Secretary for Import Carbon Quality Line Pipe from Mexico bearings and parts thereof from France, Administration, Group I. and the Republic of Korea 69 FR 44641 Germany, Italy, Japan, Singapore, and [FR Doc. 04–18454 Filed 8–11–04; 8:45 am] (July 27, 2004). The preliminary the United Kingdom for the period May BILLING CODE 3510–DS–P determinations in the investigation of 1, 2002, through April 30, 2003. See, line pipe with respect to Mexico and Initiation of Antidumping and Korea are now due not later than Countervailing Duty Administrative DEPARTMENT OF COMMERCE September 29, 2004. Reviews and Requests for Revocation in On August 5, 2004, the Department Part, 68 FR 39055, (July 1, 2003), and International Trade Administration received a request from American Steel Initiation of Antidumping and Pipe Division of ACIPC, IPSCO Tubulars Countervailing Duty Administrative [A–570–897] Inc., Lone Star Steel Company, Reviews, Requests for Revocation in Part Maverick Tube Corporation, Northwest and Deferral of Administrative Reviews, Postponement of Preliminary Pipe Company, and Stupp Corporation, 68 FR 44524, (July 29, 2003). On Determination of Antidumping Duty petitioners in these investigations, a February 9, 2004, the Department Investigation: Certain Circular Welded request for an extension of the published its preliminary findings. See Carbon Quality Line Pipe From the preliminary determination with respect Antifriction Bearings and Parts Thereof People’s Republic of China to line pipe from the PRC. See Letter from France, Germany, Italy, Japan, from Petitioners requesting an extension Singapore, and the United Kingdom: AGENCY: Import Administration, of the preliminary determination on Preliminary Results of Antidumping International Trade Administration, certain circular welded carbon quality Duty Administrative Reviews, Partial Department of Commerce. line pipe from China, dated August 5, Rescission of Administrative Reviews, SUMMARY: The Department of Commerce 2004 (‘‘Extension Request’’). Notice of Intent to Rescind (‘‘the Department’’) is postponing the Administrative Reviews, and Notice of preliminary determination in the Postponement of Preliminary Intent to Revoke Order in Part, 69 FR antidumping duty investigations of Determinations 5950, (February 9, 2004). The final certain circular carbon quality line pipe 19 CFR 351.205(e) states that a results of reviews were originally from the People’s Republic of China petitioner can request a postponement scheduled for June 8, 2004. On May 3, (‘‘PRC’’) until no later than September of the preliminary determination 25 2004, the Department published a notice 29, 2004. This postponement is made days or more before the scheduled date extending the date for issuing the final pursuant to section 733(c)(1)(B) of the of the preliminary determination and results of these reviews until August 9, Tariff Act of 1930, as amended (‘‘the must state the reasons for the request. 2004. See Antifriction Bearings and Act’’). Notification of such a postponement will be given by the Department no later Parts Thereof From France, Germany, EFFECTIVE DATE: August 12, 2004. Italy, Japan, Singapore, and the United than 20 days before the scheduled date Kingdom: Extension of Time Limit for FOR FURTHER INFORMATION CONTACT: of the preliminary determination. See 19 Final Results of Antidumping Duty Steve Williams or Jim Nunno, at (202) CFR 351.205(f). Administrative Reviews, 69 FR 24121, 482–4619 or (202) 482–0783, Although the petitioners’ request was (May 3, 2004). Extension of Time Limit respectively, Import Administration, filed beyond the deadline of 25 days for Final Results of Antidumping Duty International Trade Administration, and this notice to the parties is delayed, Administrative Reviews U.S. Department of Commerce, 14th pursuant to 19 CFR 351.302(b), the Section 751(a)(3)(A) of the Tariff Act Street and Constitution Avenue, NW., Department ‘‘may, for good cause, of 1930, as amended (the Act), requires Washington, DC 20230. extend any time limit established by the Department to issue the final results SUPPLEMENTARY INFORMATION: this Part.’’ In this instance, the
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Department finds good cause to extend DEPARTMENT OF COMMERCE Marine Co., Ltd. (Nissan); Suzuki Motor the time limit for notification of the Corporation and American Suzuki extension of the preliminary International Trade Administration Motor Corporation (Suzuki); Tohatsu determination for the reasons stated [A–588–865] Corporation, Tohatsu Marine below. Corporation, and Tohatsu America Corporation (Tohatsu); and Yamaha To begin, the period of investigation Notice of Preliminary Determination of Motor Company, Ltd., Yamaha Marine (‘‘POI’’) in the line pipe investigation of Sales at Less Than Fair Value and Postponement of Final Determination: Company, Ltd., and Yamaha Motor the PRC, a non-market economy Outboard Engines From Japan Corporation, USA (Yamaha). (‘‘NME’’), is July 1, 2003, through On February 3, 2004, the Department December 31, 2003. In NME cases, the AGENCY: Import Administration, issued a letter providing interested Department values data using prices International Trade Administration, parties an opportunity to comment on from a comparable market economy that Department of Commerce. the Department’s proposed model match is a significant producer of comparable ACTION: Notice of preliminary characteristics and its hierarchy of merchandise. However, the availability determination of sales at less than fair characteristics. The petitioner submitted of such prices that are properly value and postponement of final a timely response on February 20, 2004. contemporaneous with the POI is determination. Honda, Nissan, Suzuki, Tohatsu, and limited at this time. The Department Yamaha also submitted comments on needs additional time in order for the DATES: Effective August 12, 2004. February 20, 2004. Bombardier Motor Department to have contemporaneous FOR FURTHER INFORMATION CONTACT: Corporation and Bombardier information from a comparable market James Kemp or Shane Subler at (202) Recreational Products Inc. (Bombardier), economy on the record to corroborate 482–5346 or (202) 482–0189, a domestic interested party, submitted a properly the secondary information to respectively; AD/CVD Enforcement timely response on February 27, 2004. Based on these comments, we be used as the basis of the margin for the Office 1, Import Administration, Room determined the appropriate model PRC entity. 1870, International Trade Administration, U.S. Department of match characteristics and included In addition, as stated in the Extension Commerce, 14th Street and Constitution them in the antidumping questionnaire Request, the U.S. International Trade Avenue, NW., Washington, DC 20230. issued to Yamaha on March 11, 2004. Commission (‘‘ITC’’) reached its SUPPLEMENTARY INFORMATION: On February 23, 2004, the United affirmative preliminary injury States International Trade Commission determination for Mexico, Korea, and Preliminary Determination (ITC) preliminarily determined that the PRC on May 3, 2004. Were the We preliminarily determine that there is a reasonable indication that Department to proceed with its outboard engines from Japan are being imports of the products subject to this preliminary determination with respect sold, or are likely to be sold, in the investigation are materially injuring an to the PRC, it would be necessary that United States at less than fair value industry in the United States producing the ITC issue a separate final (LTFV), as provided in section 733 of the domestic like product. See Outboard determination for the PRC, much earlier the Tariff Act of 1930, as amended (the Engines from Japan, 69 FR at 9643 (March 1, 2004) (ITC Preliminary than with respect to Mexico and Korea. Act). The estimated margins of sales at LTFV are shown in the Suspension of Determination). The petitioners in this investigation On April 30, 2004, the petitioner Liquidation section of this notice. have requested that the Department requested that the Department extend Interested parties are invited to align these cases at its preliminary the preliminary determination in this comment on this preliminary determination to eliminate the necessity investigation by 30 days. Because there determination. We will make our final for separate ITC determinations. In the were no compelling reasons to deny the determination not later than 135 days interest of administrative efficiency, the request, we postponed the preliminary after the date of publication of this Department concludes that the Mexico, determination to July 16, 2004, under preliminary determination. Korea, and PRC cases should remain on section 733(c)(1) of the Act. On June 22, a consistent timeline. Case History 2004, the petitioner made an additional For the reasons identified above, we This investigation was initiated on request to extend the preliminary are postponing the preliminary January 28, 2004.1 See Notice deadline 20 days beyond the July 16, determinations under Section of Initiation of Antidumping Duty 2004, deadline. Once again, there were 733(c)(1)(A) of the Act by 50 days, to no Investigation: Outboard Engines from no compelling reasons to deny the later than September 29, 2004. The Japan, 69 FR at 5316 (February 4, 2004) request, and the Department made a deadline for the final determinations (Initiation Notice). Since the initiation second postponement of the preliminary determination to August 5, 2004. will continue to be 75 days after the of the investigation, the following date of the preliminary determinations. events have occurred: Postponement of Final Determination This notice is issued and published The Department of Commerce (the and Extension of Provisional Measures Department) set aside a period for all pursuant to sections 733(f) and 777(i) of Section 735(a)(2) of the Act provides interested parties to raise issues the Act. that a final determination may be regarding product coverage. See postponed until not later than 135 days Dated: August 6, 2004. Initiation Notice, 69 FR at 5317. On after the date of the publication of the Joseph A. Spetrini, February 24, 2004, the following preliminary determination if, in the companies submitted timely responses: Acting Assistant Secretary for Import event of an affirmative preliminary Administration. American Honda Motor Co., Inc., and determination, a request for such Honda Motor Co., Ltd. (Honda); Nissan [FR Doc. 04–18455 Filed 8–11–04; 8:45 am] postponement is made by exporters who BILLING CODE 3510–DS–P 1 The petitioner in this investigation is Mercury account for a significant proportion of Marine, a division of Brunswick Corporation exports of the subject merchandise. (Mercury). Section 351.210(e)(2) of the
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Department’s regulations requires that (POI), and the total quantity and value components together, whether exporters requesting postponement of of subject merchandise sold in the assembled or unassembled, and whether the final determination must also United States during the POI, by the or not accompanied by additional request an extension of the provisional Japanese producers and exporters of the components, constitute a powerhead for measures referred to in section 733(d) of subject merchandise. On March 4, 2004, purposes of this investigation. An the Act from a four-month period until the Department received timely ‘‘unassembled’’ powerhead consists of, not more than six months. We received responses from Honda, Nissan, Suzuki, at a minimum, the four powerhead a request to postpone the final Tohatsu, and Yamaha. For selecting components listed above, and any other determination from the respondent, respondents, the Department considered parts imported with it that may be used Yamaha. In its request, the respondent these statistics and statistics from U.S. in the assembly of a powerhead. consented to the extension of Customs and Border Protection (CBP). The scope does not include parts or provisional measures to no longer than Using these data, we selected Yamaha as components (other than powerheads) six months. Since this preliminary the mandatory respondent.4 On March imported separately. determination is affirmative, the request 11, 2004, the Department issued an The outboard engines and for postponement is made by an antidumping questionnaire to Yamaha. powerheads subject to this investigation exporter that accounts for a significant Period of Investigation are currently classifiable in the proportion of exports of the subject Harmonized Tariff Schedule of the merchandise, and there is no The POI is January 1, 2003, through United States (HTSUS) at subheadings compelling reason to deny the December 31, 2003. This period 8407.21.0040 and 8407.21.0080. respondent’s request, we have extended corresponds to the four most recent Although the HTSUS subheadings are the deadline for issuance of the final fiscal quarters prior to the month of provided for convenience and customs determination until the 135th day after filing of the petition (i.e., January, 2004) purposes, the written description of the the date of publication of this involving imports from a market merchandise under investigation is preliminary determination in the economy, and is in accordance with our dispositive. regulations. See 19 CFR 351.204(b)(1). Federal Register and have extended Scope Issues provisional measures to no longer than Scope of Investigation six months. In the Initiation Notice, we invited all For the purpose of this investigation, interested parties to raise issues and Selection of Respondents the products covered are outboard comment regarding the product Section 777A(c)(1) of the Act directs engines (also referred to as outboard coverage under the scope of this motors), whether assembled or the Department to calculate individual investigation. We received comments unassembled; and powerheads, whether dumping margins for each known from Honda, Nissan, Suzuki, Tohatsu, assembled or unassembled. The subject exporter and producer of the subject and Yamaha and rebuttal comments engines are gasoline-powered spark- merchandise. Where it is not practicable from the petitioner. We have ignition, internal combustion engines to examine all known producers/ preliminarily determined to continue to designed and used principally for exporters of subject merchandise, include engines under 25 horsepower marine propulsion for all types of light section 777A(c)(2) of the Act permits the (hp) and powerheads sold as spare parts recreational and commercial boats, Department to investigate either: (1) A in the scope of the investigation. We including, but not limited to, canoes, sample of exporters, producers, or types have also preliminarily determined that rafts, inflatable, sail and pontoon boats. powerheads and completed engines of products that is statistically valid, Specifically included in this scope are based on the information available at two-stroke, direct injection two-stroke, constitute a single class or kind of the time of selection; or (2) exporters and four-stroke outboard engines. merchandise. and producers accounting for the largest Outboard engines are comprised of (1) Outboard Engines Under 25 Horsepower volume of the subject merchandise that a powerhead assembly, or an internal Tohatsu requested that the scope of can reasonably be examined. In the combustion engine, (2) a midsection the investigation be revised to exclude petition, the petitioner identified six assembly, by which the outboard engine potential producers and exporters of is attached to the vehicle it propels, and all outboard engines under 25 hp. outboard engines in Japan: Honda, (3) a gearcase assembly, which typically Tohatsu argues that the Department has Nissan, Suzuki, Tohatsu, Tohatsu includes a transmission and propeller the authority to both limit and expand Marine Corporation (TMC), and the scope of an investigation proposed shaft, and may or may not include a 5 Yamaha. On March 4, 2004, Tohatsu propeller. To the extent that these in a petition. Tohatsu maintains that placed information on the record components are imported together, but domestic producers import all or, if not indicating that Nissan is not a producer, unassembled, they collectively are all, the vast majority of their engines although it exports engines produced by covered within the scope of this under 25 hp. According to Tohatsu, the Tohatsu to the U.S. market.2 investigation. An ‘‘unassembled’’ petitioner purchases the vast majority of Information placed on the record by the outboard engine consists of a its under 25 hp line from its Japanese petitioner indicated that it was powerhead as defined below, and any joint venture, Tohatsu Marine appropriate to treat Tohatsu and TMC as other parts imported with the Corporation. The remainder of the a single entity.3 powerhead that may be used in the petitioner’s under 25 hp line consists of On March 1, 2004, the Department assembly of an outboard engine. either limited domestic production or requested information on the total Powerheads are comprised of, at a outboard engines assembled from quantity and value of subject minimum, (1) a cylinder block, (2) powerheads imported from Japan. merchandise exported to the United pistons, (3) connecting rods, and (4) a Further, Tohatsu argues, the emission States during the period of investigation crankshaft. Importation of these four standards established by the U.S. Environmental Protection Agency 2 See letter from Tohatsu to the Department, dated 4 See memo from Shane Subler, International March 4, 2004, at Exhibit 1. Trade Compliance Analyst, to Gary Taverman, 5 See, e.g., Mitsubishi Elec. Corp v. United States, 3 See letter from Mercury to the Department, Director of Office 5, RE: Selection of Respondents, 700 F. Supp. 538, 555 (CIT 1988), aff’d 898 F.2d dated February 27, 2004, at page 2. dated March 11, 2004. 1577 (Fed. Cir. 1990).
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(EPA), which mandate that outboard engines, but do not prohibit specific solely for the purpose of repairing motor manufacturers reduce their technologies. outboard engines previously sold by the average emissions in each year from the In addition, the petitioner contends same manufacturer be excluded from 1998 through 2005 model years, will that outboard motors under 25 hp do the scope of the investigation. Both prevent the petitioner from compete with other engines. The Honda and Suzuki emphasize that they manufacturing two-stroke carbureted petitioner argues that a 25 hp engine import a limited number of powerheads engines under 25 hp after 2006. Tohatsu competes with both 20 and 30 hp for this purpose. Suzuki states that, with maintains that this would leave the U.S. engines, and that there is no clear most of these imports, the cost of the customers of these engines no choice dividing line at 25 hp that would merit powerhead was reimbursed as a but to buy an imported motor on which making it a cut-off point for the purpose warranty cost. Honda states it does not antidumping duties have been imposed. of excluding engines from the scope of have any ‘‘sale’’ prices for these units, Finally, Tohatsu argues that small the investigation. as they were used almost exclusively to horsepower engines do not compete Analysis satisfy warranty claims. with large engines. According to The petitioner argues that the When the Department receives a Tohatsu, engines under 25 hp are Department should deny Honda and petition that meets the requirements of lightweight, portable, hand-throttle Suzuki’s request to exclude powerheads the statute, it must initiate an models which do not require special from the scope of the investigation investigation 9 and, if warranted by the factory or dealer-installed rigging. They based on their intended use. According evidence, provide the relief requested.10 are used primarily for inflatable to the petitioner, the proposed exclusion The starting place for determining the dinghies and small boats, or as the would be impossible to monitor and merchandise that is to be the subject of auxiliary power source for sailboats. would present an obvious means of an investigation is the petition itself.11 circumventing the order. To the extent Large engines, Tohatsu states, are not While the Department does have the portable, require specialized rigging, the companies do not have sale prices authority to define or clarify the scope for these units, the petitioner suggests and are used as the main power source of an investigation,12 it does not use its for larger boats and specialty boats that the Department could excuse authority to define the scope of an respondents from reporting these units where speed is required. Tohatsu investigation in a manner that would believes that this lack of if the imports are indeed very limited. thwart the statutory mandate to provide The petitioner asserts, however, that interchangeability supports excluding the relief requested in the petition. As engines under 25 hp from the scope of these units should not be excluded from a result, absent an ‘‘overarching reason the scope. the investigation. to modify’’ the scope in the petition, the The petitioner states that outboard Department accepts it.13 Analysis engines under 25 hp unambiguously Engines having 25 hp or less clearly As discussed above, absent an come within the literal terms of the meet the definition of covered ‘‘overarching reason to modify’’ the petition.6 The petitioner also argues that merchandise in that the scope makes no scope in the petition, the Department the Department gives ‘‘ample deference limitation on horsepower. Further, we accepts it. In the instant case, the scope to the petitioners on the definition of agree with the petitioner that it is not specifically includes powerheads. the product for which they seek necessary that the domestic industry Attempting to exclude certain relief.’’ 7 Although the petitioner produce all products covered by the powerheads from the scope of the concedes that the Department has the scope. We note, however, that Mercury investigation based on usage would ultimate authority to define the scope of has placed evidence on the record cause significant administrability the investigation, it generally does not indicating that it does produce certain problems for CBP, should an alter the petitioner’s scope definition engines under 25 hp. Therefore, since antidumping duty order ensue. except to clarify ambiguities in the the scope language of this case clearly Therefore, we continue to include all language or address administrability includes engines of 25 hp or less, we powerheads in the scope of the problems.8 continue to include them in the scope investigation, regardless of the reason The petitioner states that Mercury of the investigation. for importation. does produce domestically a range of Powerheads Imported as Replacement Treatment of Powerheads as a Separate engines under 25 hp. However, the Parts petitioner notes that it is not necessary Class or Kind that the domestic industry produce Honda and Suzuki requested that The term ‘‘class or kind’’ is equated products identical to every item powerheads imported as spare parts with the term ‘‘subject merchandise’’ at imported or to every single segment of section 771(25) of the Act. (This the subject merchandise continuum. 9 Sections 702(c)(2) and 732(a)(1) of the Act. provision defines subject merchandise 10 Section 731(1) of the Act. The relief sought as the class or kind of merchandise Further, the petitioner contends that would apply to all subject merchandise that is Tohatsu’s argument that 2-stroke within the scope of the investigations. See section within the scope of an investigation or carbureted engines will not be available 731(2) of the Act. other proceeding covered by the for sale after 2005 due to EPA 11 See 19 CFR 351.225(k)(1) (2001). See also statute.) The Department bases its Eckstrom Industries, Inc. v. United States, 254 F.3d determination of whether the regulations is incorrect. The petitioner 1068, 1071–72 (Fed. Cir. 2001) (citing Smith Corona states that the EPA regulations impose Corp. v. United States, 915 F.2d 683, 685 (Fed. Cir. merchandise, as described in the scope emission standard levels on outboard 1990)). of a proceeding, constitutes a single 12 See generally Final Determination of Sales at class or kind of merchandise on an Less Than Fair Value: Certain Carbon Alloy Steel 6 evaluation of the criteria set forth in See letter from the petitioner to the Department, Wire Rod from Japan, Comment 1, 59 FR at 5987, dated March 11, 2004, at page 3. 5988–5989 (Feb. 9, 1994). Diversified Products v. United States, 7 See Notice of Final Determination of Sales at 13 See Notice of Final Determination of Sales at 572 F. Supp. 883, 889 (CIT 1983) Less Than Fair Value: Circular Seamless Stainless Less Than Fair Value: Certain Softwood Lumber (Diversified Products), which look to Steel Hollow Products from Japan, 65 FR at 42985 Products from Canada, 67 FR at 15539 (April 2, differences in: (1) The general physical (July 12, 2000) and Accompanying Issues and 2002) and Accompanying Issues and Decision Decision Memorandum. Memorandum at Comment 51; see also 19 CFR characteristics of the merchandise, (2) 8 See, e.g., id. at 42985. 351.225(k) (2001). the expectations of the ultimate
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purchaser, (3) the ultimate use of the characteristics of powerheads and customers. Powerheads have a limited merchandise, (4) the channels of trade outboard engines, and no clear dividing number of customers and require much in which the merchandise moves, and line exists. less in the way of marketing and selling (5) the manner in which the product is expenses. B. Expectations and End-Uses by the The petitioner points out that in its advertised or displayed. Both parties Ultimate Customer addressed the Diversified Products Section A response, Yamaha stated that criteria. According to Yamaha, the ultimate the channels of distribution for Yamaha argues that powerheads purchaser of a finished engine is the powerheads are identical to those for should be treated as a separate class or consumer who buys the engine as part outboard motors. See Yamaha’s Section kind from completed engines, and that of a boat package and intends to use that A questionnaire response dated May 18, powerheads should be excluded from engine to power the boat. The ultimate 2004, at page A–28. In addition, for the scope of the investigation. purchasers of powerheads are outboard sales of powerheads in the U.S. market, According to Yamaha, the Department’s motor manufacturers, who intend to Yamaha stated that there is only one practice has been to treat sub-assemblies incorporate this component into their channel of distribution for and semi-finished products as a separate own engines. Because of the large powerheads—dealer distribution. See class or kind.14 degree of further manufacturing id. at page A–29. Therefore, the The petitioner rebuts that the necessary to convert a powerhead to a petitioner concludes that there is ample Department has included less than finished engine, these two products are evidence on the record that powerheads complete merchandise within the scope not interchangeable—a customer could and outboard engines are sold through of the investigation with complete not buy a powerhead to use as the the same channels of trade in both the merchandise in numerous cases, and propulsion system on a boat. Therefore, U.S. and home markets. has not determined less than complete Yamaha maintains that the products D. Manner of Advertising and complete merchandise to be have entirely different end-users and, as separate classes or kinds.15 a result, different expectations among With respect to powerheads, Yamaha the particular end-users. states that when there is only one A. Physical Characteristics The petitioner maintains that there is customer, such as the petitioner, it is Yamaha maintains that powerheads almost complete overlap in the end uses not necessary to incur excessive selling have distinct physical characteristics of outboard engines and powerheads. and marketing expenses. Finished from finished outboard motors in that Outboard engines are used to propel a motors, on the other hand, require a the components making up a powerhead boat; powerheads are used to provide great deal of additional expenses to constitute a small portion of the overall power to the outboard engine in order market and advertise because there is an parts and systems incorporated within a to propel a boat. According to the extremely large customer base. Yamaha finished engine. Yamaha states that petitioner, because every outboard explains that various forms of print and ‘‘according to the petition, powerheads engine contains a powerhead, the end television advertising are necessary to consist of the cylinder block, pistons, uses are the same. The petitioner advertise the finished outboard engine connecting rods and the crankshaft.’’ 16 concedes that a powerhead alone cannot and boat package, whereas there is The petitioner argues that the general propel a boat, but finds this fact virtually no advertising necessary to sell physical characteristics of both irrelevant because a powerhead has no powerheads to outboard engine powerheads and outboard engines are end use unless it is propelling a boat as manufactures. very similar. The outboard engine, the part of an outboard engine. Further, the The petitioner contends that while petitioner points out, contains all the petitioner points out that powerhead there is essentially no advertising of physical characteristics of the failure is not uncommon, and when it powerheads alone, the advertising for powerhead, which is the ‘‘engine’’ part happens, the boat owner is faced with powerhead sales is subsumed within the of an outboard engine. Further, the a decision of whether to buy a advertising for the outboard engine. If a petitioner states that the scope of the powerhead or a completely new engine. company’s advertising for completed investigation defines the minimum According to the petitioner, the engines persuades a customer to defining characteristics of a powerhead. expectation of that customer, whether purchase its brand of outboard motor, it A powerhead may also include he decides to buy a powerhead or a creates a captive market for its additional components. The petitioner completely new engine, is that the non- powerheads in that the customer must contends that the powerheads covered functional outboard engine will be come back to the manufacturer to in the scope of the investigation include replaced with a functional outboard purchase a replacement powerhead assemblies that consist of a significant engine capable of providing propulsion should the engine fail. This subtle percentage of a completed outboard to the boat. difference in advertising, the petitioner engine. For this reason, the petitioner C. Channels of Trade maintains, is not sufficient to outweigh maintains that there is a significant the significant overlap among the other Because they have completely overlap in the general physical four diversified product criteria. different purchasers, Yamaha argues, Analysis 14 See, e.g., Color Picture Tubes from Canada, powerheads and finished engines of Japan, Republic of Korea and Singapore; Negative necessity have completely different We analyzed this issue based on the Final Determinations of Circumvention of channels of trade. Powerheads are sold criteria set forth by the CIT in Antidumping Duty Orders, 56FR at 9667, (March 7, to manufacturers; finished engines are Diversified Products. 1991); Final Determinations of Sales at Less Than sold to customers buying a boat Fair Value: Certain Alloy and Carbon Hot-Rolled A. Physical Characteristics Bars, Rods, and Semifinished Products of Special package. Yamaha maintains that there Bar Quality Engineered Steel from Brazil, 58 FR at are consequently different costs The powerhead, which provides the 31496 (June 3, 1993) (Hot-Rolled Steel from Brazil). associated with each of these channels motive force to an outboard engine, is a 15 See, e.g., Mechanical Transfer Presses From as a great deal of marketing and sales major component of the finished Japan: Final Results of Antidumping Duty Administrative Review, 68 at 39515 (July 2, 2003). expenditures are required to sell product, and thus shares its primary 16 See letter from Yamaha to the Department, finished engines to the retailers and physical characteristics. Additionally, dated February 24, 2004, at page 5. dealers which are the ultimate in deciding whether physical
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differences in merchandise rise to the making new engines or by engine repair This would indicate that the completed level of a class or kind distinction, the facilities using the powerhead as a engine, a component of the boat Department looks for a clear dividing replacement part. Although the package, benefits from the advertising line between product groups, not merely powerhead cannot be used by itself to for the whole package. Powerheads can the presence or absence of physical power a boat, both the engine be assumed to receive at least some differences.17 The scope of this manufacturers and engine repair benefit from the advertising done for the investigation defines the minimum facilities expect that, after installation, completed engine, to the extent the components which make up a the powerhead will be capable of customers are convinced that the powerhead—cylinder block, pistons, powering the boat. The finished engine features the powerhead contributes to connecting rods and the crankshaft. It gets its propulsion from the powerhead. the final engine are desirable. However, does not, however, define a limit for the In contrast to Hot-Rolled Steel from we note that if a powerhead goes into an maximum number of additional parts Brazil, where the Department found that engine which is subsequently marketed which can be added to the powerhead the semi-finished products, hot-rolled under another manufacturer’s name, before it ceases to be properly bars and rods, ‘‘have numerous ultimate this advertising benefit is largely categorized as a powerhead and uses, including machining, forging, and eliminated. Therefore, there appears to becomes an outboard engine. The hot- and cold-forming,’’ and that be little similarity in the manner of petition lists other components which ‘‘consumers of hot-rolled bars and rods advertising between powerheads and may be attached to the four basic expect a product which meets relatively completed engines. elements of a powerhead, such as a exacting tolerances, while consumers of Conclusion starter; alternator; flywheel ignition semifinished products do not require system; flywheel; stator or ECU such exacting specifications,’’19 we find As an initial matter, we disagree with (programmable); carburetors; electrical that the powerheads in this case have Yamaha that it is the Department’s harness; electrical plate assembly and only one use—to be incorporated into a practice to treat subassemblies of electrical harness; oil pump; throttle completed outboard engine and used to finished products as a separate class or linkages; battery cables and propel a boat. Further, the standards to kind. The Department has a large connections; and spark plugs.18 which the powerhead is produced number of cases where a petition was Presumably, other components could be determine into which specific type of filed on products and their major added to a powerhead to the point engine it will be incorporated. These components, in which they were treated 21 where it might be more properly standards also determine what level of as a single class or kind. Further, we classified as an outboard engine. power the consumer, be it an engine find Yamaha’s reference to Color Picture Consequently, we find that a clear manufacturer, a boat-builder, or a boat Tubes to be off-point, as the order in dividing line between powerheads and owner, can expect from that engine. question did not cover completed color completed outboard engines does not televisions. exist. For these reasons, we C. Channels of Trade In analyzing the Diversified Products preliminarily determine that the Powerheads are sold primarily to criteria, we find that the similarities in differences in physical characteristics engine manufacturers, a different physical characteristics, end uses, and between powerheads and outboard customer category than the boat the expectations of the ultimate engines are not significant. manufacturers, dealers and distributors purchaser outweigh differences in We note that in developing the model which purchase completed engines. channels of trade and advertising. The matching criteria to be used in this When powerheads are sold as spare or powerhead is a defining characteristic of investigation, all parties agree that replacement parts, they also are sold to the completed engine, and there is no products should be classified as either boat manufacturers, dealers, and clear dividing line between the two. We powerheads or complete engines. distributors. With regard to the note that because we have determined Yamaha’s classification of its products petitioner’s cites to Yamaha’s response, that powerheads and completed into those categories has not been we note that in both the U.S. and home outboard engines constitute a single contested. Nevertheless, this cannot be market, Yamaha was referring to its class or kind of merchandise, Yamaha’s construed to mean that a clear dividing sales of powerheads as spare and comment regarding removing line exists for all manufacturers in all replacement parts. The majority of powerheads from the scope becomes situations. Yamaha’s sales of powerheads are going moot. B. Expectations and End-Uses by the to engine manufacturers. There is no Yamaha’s Sales to Mercury Ultimate Customer evidence on the record that this is not Yamaha reported sales of certain typical for the industry. Therefore, it Completed outboard engines are powerhead models to Mercury’s affiliate appears that the majority of powerhead unquestionably used to power boats. in Japan, Mercury Marine Japan, as U.S. sales are made via a different channel of Powerheads are fitted into outboard sales. Yamaha assists Mercury in trade from that of completed outboard engines either by engine manufacturers shipping these models to the United engines. States. Therefore, Yamaha has 17 See Final Affirmative Less Than Fair Value D. Manner of Advertising knowledge that the United States is the Determination: Sulfur Dyes, Including Vat Sulfur final destination of the merchandise. Both parties agree that powerheads Dyes, from the U.K., 58 FR at 3253 (January 8, However, for sales of other models of 1993); see also, Notice of Final Determinations of are not advertised directly. The Sales at Less Than Fair Value: Certain Large advertising which does occur in the Diameter Carbon and Alloy Seamless Standard, 21 See, e.g., Notice of Initiation: Floor-Standing Line and Pressure Pipe from Japan; and Certain industry is for the completed engine and Metal-Top Ironing Tables and Certain Parts Thereof Small Diameter Carbon and Alloy Seamless is often aimed at the boat owner. from the People’s Republic of China, 68 FR at 44040 Standard, Line and Pressure Pipe from Japan and Yamaha has indicated that some of the (July 25, 2003); Final Results of Change the Republic of South Africa, 65 FR at 25907 (May advertising is for the ‘‘boat package.’’ 20 Circumstances Review, Revocation of the 4, 2000) and the Accompanying Issues and Decision Antidumping Duty Order, and Rescission of Memorandum at Comment 1. Administrative Reviews: Large Newspaper Printing 18 See Petition for the Imposition of Antidumping 19 See Hot-Rolled Steel from Brazil at 31496. Presses and Components Thereof, Whether Duties: Outboard Engines from Japan at Exhibit I– 20 See letter from Yamaha to the Department, Assembled or Unassembled, from Germany, 67 FR 1. dated February 24, 2004, at page 7. at 53996 (April 22, 2002).
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engines and powerheads to Mercury foreign trade zone.25 Mercury could change our analysis that Yamaha knew Marine Japan, Yamaha states that it then further manufacture the or should have known the destination of relinquishes the title to the product powerheads and re-export them to a the powerheads. The first sale of the when it arrives at the Japanese port. third country. Under these powerheads is from Yamaha to Mercury. Yamaha, therefore, asserts that it has no circumstances, Yamaha argues, the We have based our analysis on this sale. knowledge of the final destination of powerheads would not be entering the The sale of complete engines from this merchandise and classified these United States for customs purposes. Mercury to the ultimate purchasers sales as home market sales. As support The Department has interpreted the occurs after the powerheads have for this classification, Yamaha points to phrase ‘‘for exportation to the United undergone the requisite further Mercury’s plants in Belgium and States’’ in section 772(b) of the statute manufacturing at Mercury’s Wisconsin Mexico as evidence that the to mean that the reseller or plant. Because the powerheads must go merchandise may go elsewhere than the manufacturer from whom merchandise directly to the Wisconsin plant after United States for further processing. was purchased knew or should have Yamaha sells them to Mercury, the sale Although Yamaha is not aware of any known at time of sale that merchandise of the complete engine by Mercury to Mercury plants in Japan that could was being exported to the United States. the ultimate purchaser did not affect our process powerheads into outboard See LG Semicon v. United States, 23 CIT analysis. With regard to Yamaha’s engines, it does claim that Mercury sells 1074 (December 30, 1999). Based on argument that Mercury may import the finished engines containing the evidence placed on the record, we powerheads under a temporary import powerheads in question in Japan. preliminarily determine that Yamaha bond or to a bonded warehouse or Furthermore, Yamaha notes that knew or should have known that the foreign trade zone, we note that the duty Mercury has sales outside of the United powerheads it sold to Mercury were rate for powerheads during the period of States of engines built from the being exported directly to the United investigation was zero. Therefore, powerhead models in question.22 States. These sales should, therefore, be Mercury would have had little reason to In response to Yamaha’s classification classified as U.S. sales. import the powerheads under a of these sales as home market sales, Bombardier placed the U.S. Securities temporary import bond or to a bonded 23 Mercury submitted an affidavit stating and Exchange Commission’s Form 10–K warehouse or foreign trade zone. that all of the powerheads and engines report for Brunswick Corporation, For these reasons, we preliminarily purchased by Mercury Marine Japan Mercury’s parent company, on the determine that Yamaha knew or should from Yamaha had to undergo further record of this case.26 The document have known that these sales were to be processing at Mercury’s Wisconsin states, ‘‘Mercury Marine also exported to the United States. As a plant. Mercury claims that all of the manufactures engine component parts at result, we have moved all of Yamaha’s engines and powerheads sold by plants in Florida and Mexico, and has sales of powerheads to Mercury from its Yamaha to Mercury were exported a facility in Belgium that customizes home market database to its U.S. directly from Japan to the United States engines for sale into Europe.’’ database. for processing at this plant. The affidavit Furthermore, Mercury’s Web site For outboard engines sold by Yamaha also states that Mercury’s plant in describes the Mexican plant’s function Mexico only produces components for to Mercury Marine Japan, however, as the ‘‘manufacture of wire harnesses, there is no compelling reason to believe outboard engines, and that its plant in remote controls for Quiksilver, Belgium has never received powerheads Yamaha knew or should have known miscellaneous electrical assemblies for that these engines were destined for the or engines directly from Yamaha. The engines and spare parts, and machining submission attached to the affidavit United States. Yamaha acknowledges operation for the outboard business that this merchandise is packed for states that neither plant manufactures or unit.’’ 27 This publicly available further processes the subject export. This does not, however, indicate information, combined with Yamaha’s that all of these sales were exported to merchandise. The affidavit also claims tours of these plants, indicates Yamaha that Yamaha officials have toured these the United States. Although Mercury knew or should have known that the indicated that all of these engines were two plants and are aware of the plants’ powerheads it sold to Mercury Marine functions. exported to the Wisconsin plant for Japan were to be exported to the United further processing, it is reasonable to Although Yamaha acknowledges that States, the only location where Mercury one of its officials toured the Mercury believe that a finished engine could be could process the powerheads into sold directly in Japan or to a third plant in Belgium, Yamaha claims to completed outboard engines. have no specific knowledge of country. Without evidence that Yamaha Information placed on the record by knew or should have known these Mercury’s manufacturing and shipping Yamaha does not support its contention 24 exports were destined for the United process at this plant. Yamaha also that it had no specific knowledge of notes that Mercury sells completed States, we preliminarily determine that Mercury’s manufacturing process at the these sales should be excluded from our engine units containing the powerhead 28 plant in Belgium. analysis. models in question outside of the Yamaha’s argument that Mercury had United States. Furthermore, Yamaha sales outside of the United States of Fair Value Comparisons suggests that Mercury could import the engines that are built from the To determine whether sales of powerheads into the United States powerhead models in question does not under a temporary importation bond or outboard engines were made in the United States at LTFV, we compared the send them to a bonded warehouse or 25 See id. at page 3. 26 See letter from Bombardier to the Department, export price (EP) and the constructed 22 See Yamaha’s second supplemental Sections A, dated May 27, 2004, at Attachment 1. export price (CEP) to the normal value B, and C questionnaire response, dated July 22, 27 See memorandum from Shane Subler, (NV), as described in the Export Price 2004, at page 2. International Trade Compliance Analyst, to file, Re: and Constructed Export Price and 23 See letter from Mercury to the Department, Mercury’s Web site Description of its Juarez, Normal Value sections of this notice. In dated June 29, 2004. Mexico Plant, dated August 5, 2004. 24 See Yamaha’s second supplemental Sections A, 28 See Yamaha’s second supplemental Sections A, accordance with section B, and C questionnaire response, dated July 22, B, and C questionnaire response, dated July 22, 777A(d)(1)(A)(i) of the Act, we 2004, at page 2. 2004, at Exhibit 2. calculated weighted-average EPs and
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CEPs. We compared these to weighted- Corporation, USA, to unaffiliated Department will normally consider average home market prices in Japan. purchasers in the United States. quantity (or value) insufficient if it is The date of sale on which we based In accordance with section 772(c)(2) less than five percent of the aggregate our comparisons depended on the of the Act, for both EP and CEP sales, quantity (or value) of sales of the subject market. For all of Yamaha’s home we made deductions from the starting merchandise to the United States. We market sales, Yamaha Motor Marketing price for movement expenses, found that Yamaha had a viable home Japan Co., Ltd. (YMMJ) issues monthly discounts, billing adjustments, and market for outboard engines. As such, sales invoices to its customers. Yamaha rebates, where appropriate. Yamaha submitted home market sales reported the date of shipment as either After reviewing the terms of delivery data for the calculation of NV. before or equal to the invoice date. In for EP sales to Mercury, we deducted In deriving NV, we made adjustments keeping with Department practice, we foreign inland freight from the gross as detailed in the following Calculation used the date of shipment as the date of price, where appropriate. For EP sales to of Normal Value Based on Home Market sale for all home market sales.29 In the Puerto Rico, the deductions for Prices section. movement expenses depended on the U.S. market, we used the invoice date as B. Cost of Production Analysis the date of sale for the majority of circumstances of the transaction. For transactions. However, some U.S. sales direct sales to Puerto Rico, we deducted Based on allegations contained in the have a shipment date that precedes the only foreign inland freight and foreign petition, and in accordance with section invoice date. For these sales, we brokerage, handling, and port charges. 773(b)(2)(A)(i) of the Act, we found determined that date of shipment is the For all other sales to Puerto Rico, we reasonable grounds to believe or suspect most appropriate date of sale. For sales deducted foreign inland freight; foreign that outboard engine sales were made in of powerheads to Mercury, we found brokerage, handling, and port charges; Japan at prices below the cost of that the shipment date was the international freight and insurance; U.S. production (COP). See Initiation Notice, appropriate date of sale. brokerage, handling, and port charges; 69 FR at 5318. As a result, the U.S. warehousing; and U.S. inland Department has conducted an Export Price and Constructed Export freight. For CEP sales, movement investigation to determine whether Price expenses included foreign inland freight Yamaha made home market sales at For the price to the United States, we and insurance; foreign warehousing; prices below their respective COPs used, as appropriate, EP or CEP, as foreign brokerage, handling, and port during the POI within the meaning of defined in sections 772(a) and 772(b) of charges; international freight and section 773(b) of the Act. We conducted the Act, respectively. Section 772(a) of insurance; U.S. inland freight and the COP analysis described below. the Act defines EP as the price at which insurance; U.S. warehousing; and U.S. 1. Calculation of Cost of Production the subject merchandise is first sold brokerage, handling, and port charges. before the date of importation by the Section 772(d)(1) of the Act provides In accordance with section 773(b)(3) producer or exporter outside of the for additional adjustments to calculate of the Act, we calculated a weighted- United States to an unaffiliated CEP. Accordingly, where appropriate, average COP based on the sum of the purchaser in the United States or to an we deducted direct selling expenses and cost of materials and fabrication for the unaffiliated purchaser for exportation to indirect selling expenses related to foreign like product, plus amounts for the United States, as adjusted under commercial activity in the United the home market G&A expenses, subsection 772(c) of the Act. States. Pursuant to section 772(d)(3) of including interest expenses, and Section 772(b) of the Act defines CEP the Act, where applicable, we made an packing expenses. We relied on the COP as the price at which the subject adjustment for CEP profit. data submitted by Yamaha in its cost merchandise is first sold in the United In addition to these adjustments, we questionnaire responses. States before or after the date of recalculated credit expense for sales that 2. Test of Home Market Sales Prices importation by or for the account of the had no reported pay dates. For all such We compared the weighted-average producer or exporter of such sales, we used the date of this COP for Yamaha to its home-market merchandise or by a seller affiliated preliminary determination as date of sales prices of the foreign like product, with the producer or exporter, to a payment for the merchandise. See the as required under section 773(b) of the purchaser not affiliated with the Memorandum from James Kemp and Act, to determine whether these sales producer or exporter, as adjusted under Shane Subler, International Trade had been made at prices below the COP subsections 772(c) and (d) of the Act. Compliance Analysts, to the File, Re: within an extended period of time (i.e., Certain sales by Yamaha are properly Analysis Memorandum for Yamaha a period of one year) in substantial classified as EP sales because they were Motor Company, Ltd., Yamaha Marine quantities and whether such prices were made outside the United States by the Company, Ltd., and Yamaha Motor sufficient to permit the recovery of all exporter or producer to an unaffiliated Corporation, USA, dated August 5, 2004 costs within a reasonable period of time. customer in the United States prior to (Analysis Memorandum). On a model-specific basis, we the date of importation. The remainder Normal Value compared the revised COP to the home of Yamaha’s sales are properly classified market prices, less any applicable as CEP sales because they were made for A. Selection of Comparison Markets movement charges, discounts, rebates, the account of Yamaha, by Yamaha’s Section 773(a)(1) of the Act directs the and direct and indirect selling expenses. U.S. affiliate, Yamaha Motor Department to calculate NV based on the price at which the foreign like 3. Results of the COP Test 29 See, e.g., Synthetic Indigo From the People’s Republic of China; Notice of Final Determination of product is sold in the home market, We disregarded below-cost sales Sales at Less Than Fair Value, 65 FR 25706 (May provided that the merchandise is sold in where (1) 20 percent or more of 3, 2000) and accompanying Decision Memorandum sufficient quantities (or value, if Yamaha’s sales of a given product at Comment 11; Final Results of Antidumping quantity is inappropriate), and that during the POI were made at prices Administrative Review: Stainless Steel Bar From Japan, 65 FR 13717 (March 14, 2000) and there is no particular market situation below the COP, and thus such sales accompanying Decision Memorandum at Comment that prevents a proper comparison with were made within an extended period of 1. the EP or CEP. Under the statute, the time in substantial quantities in
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accordance with sections 773(b)(2)(B) packing costs as described in the Export functions and activities may be and (C) of the Act, and (2) based on Price and Constructed Export Price dissimilar. We found the following. comparisons of price to weighted- section, above. Yamaha reported three channels of average COPs for the POI, we We made adjustments to CV for distribution in the home market: (1) determined that the below-cost sales of differences in COS in accordance with Sales to distributors (HM2); (2) sales to the product were at prices which would section 773(a)(8) of the Act and 19 CFR dealers (HM3); and (3) sales to Mercury. not permit recovery of all costs within 351.410. For comparisons to EP, we For purposes of the preliminary a reasonable time period, in accordance made COS adjustments by deducting determination, we disregarded the sales with section 773(b)(2)(D) of the Act. We direct selling expenses incurred on made to Mercury and did not consider found that Yamaha made sales below home-market sales from, and adding such sales in our level of trade analysis. cost and we disregarded such sales U.S. direct selling expenses to, CV. For See Yamaha’s Sales to Mercury above. where appropriate. comparisons to CEP, we made COS To determine whether HM2 and HM3 adjustments by deducting from CV constitute separate levels of trade in the C. Calculation of Normal Value Based home market, we examined the on Home Market Prices direct selling expenses incurred on home-market sales. marketing process and selling functions We determined NV for Yamaha as to these two types of customers. We find follows. We made adjustments for any E. Level of Trade/Constructed Export that sales made to dealers are at a more differences in packing and deducted Price Offset remote marketing stage than that for home market movement expenses, In accordance with section sales to distributors. We also find that rebates, and discounts pursuant to 773(a)(1)(B) of the Act, to the extent sales to dealers require more intensive sections 773(a)(6)(A) and 773(a)(6)(B)(ii) practicable, we determine NV based on selling activities. Based on this of the Act. In addition, where applicable sales in the comparison market at the examination, we preliminarily in comparison to EP transactions, we same level of trade as the EP determine that Yamaha sold made adjustments for differences in transaction. The NV level of trade is that merchandise at two levels of trade in the circumstances of sale (COS) pursuant to of the starting-price sales in the home market during the POI. One level section 773(a)(6)(C)(iii) of the Act. We comparison market. For EP sales, the of trade is for sales made by Yamaha to made COS adjustments for Yamaha’s EP U.S. level of trade is also the level of the distributors (HM2), and the second level transactions by deducting direct selling starting-price sale, which is usually of trade is for sales made by Yamaha to expenses incurred for home market from exporter to importer. dealers (HM3). For a more detailed sales (e.g., credit expense and warranty discussion of Yamaha’s levels of trade, To determine whether comparison expenses) and adding U.S. direct selling see Analysis Memorandum. market sales are at a different level of expenses (e.g., credit expenses). In the U.S. market, Yamaha reported In addition to these adjustments, we trade than EP transactions, we examine two EP channels of distribution: (1) disregarded certain sales in the home stages in the marketing process and Direct sales by Yamaha to Mercury market database because the selling functions along the chain of (US1) and (2) direct sales to a distributor merchandise was produced in France. distribution between the producer and in Puerto Rico (US2). To determine See Analysis Memorandum. the unaffiliated customer. If the whether separate levels of trade exist for comparison-market sales are at a EP sales to the U.S. market, we D. Calculation of Normal Value Based different level of trade and the examined the selling functions, the on Constructed Value difference affects price comparability, as chain of distribution, and the customer Section 773(a)(4) of the Act provides manifested in a pattern of consistent categories reported in the United States. that, where NV cannot be based on price differences between the sales on For Yamaha’s sales to Mercury, the comparison-market sales, NV may be which NV is based and comparison- questionnaire response indicates that based on CV. Accordingly, for those market sales at the level of trade of the the respondent conducted invoice/order models of outboard engines for which export transaction, we make a level-of- processing for the transactions and in we could not determine the NV based trade adjustment under section some instances made freight on comparison-market sales, either 773(a)(7)(A) of the Act. arrangements. Nevertheless, we because there were no useable sales of In implementing these principles in concluded that there were few selling a comparable product or all sales of the this investigation, we obtained activities undertaken to support these comparable products failed the COP information from Yamaha about the sales. Further, comparing Yamaha’s test, we based NV on CV. marketing stages involved in the sales to Mercury to Yamaha’s home Section 773(e) of the Act provides that reported U.S. and home market sales, market sales, we find that there is no the CV shall be based on the sum of the including a description of the selling level of trade in the home market that cost of materials and fabrication for the activities performed by the respondent corresponds to Yamaha’s sales to imported merchandise, plus amounts for each channel of distribution. In Mercury. Therefore, for Yamaha’s EP for selling, general and administrative identifying levels of trade for EP and sales to Mercury (US1), we first (SG&A) expenses, profit, and U.S. home market sales, we considered the attempted to match to the closest home packing costs. We calculated the cost of selling functions reflected in the starting market level of trade (HM2). materials and fabrication based on the price before any adjustments. For Yamaha’s EP sales to the methodology described in the Cost of In conducting our level-of-trade distributor in Puerto Rico, we found that Production Analysis section, above. We analysis for Yamaha, we examined the the number and degree of selling based SG&A and profit on the actual specific types of customers, the functions closely correspond to amounts incurred and realized by channels of distribution, and the selling Yamaha’s sales to distributors in the Yamaha in connection with the practices of the respondent. Generally, if home market. Thus, we determined that production and sale of the foreign like the reported levels of trade are the same, these two channels of distribution are at product in the ordinary course of trade the functions and activities of the seller the same level of trade. For a more for consumption in the comparison should be similar. Conversely, if a party detailed discussion of the selling market, in accordance with section reports levels of trade that are different functions corresponding to levels of 773(e)(2)(A) of the Act. We used U.S. for different categories of sales, the trade for sales to the distributor in
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Puerto Rico, see Analysis Memorandum. home market level of trade (HM2) and Public Comment To the extent possible, we compared granted a CEP offset pursuant to section Interested parties are invited to Yamaha’s EP sales to Puerto Rico to 773(a)(7)(B) of the Act. Where we were comment on the preliminary home market sales at the same level of unable to find a match at the closest determination. Interested parties may trade, HM2. level of trade, we matched to HM3 and submit case briefs on the later of 50 days When we were unable to find sales of granted a CEP offset. the foreign like product in the home after the date of publication of this market at the same level of trade as the Currency Conversions notice or one week after the issuance of the verification reports. See 19 CFR U.S. sales, we examined whether a We made currency conversions into level-of-trade adjustment was 351.309(c)(1)(i). Rebuttal briefs, the U.S. dollars in accordance with section content of which is limited to the issues appropriate. When we compare U.S. 773A of the Act based on exchange rates sales to home market sales at a different raised in the case briefs, must be filed in effect on the dates of the U.S. sale, within five days after the deadline for level of trade, we make a level-of-trade as obtained from the Federal Reserve adjustment if the difference in levels of the submission of case briefs. See 19 Bank (the Department’s preferred source trade affects price comparability. We CFR 351.309(d). A list of authorities for exchange rates). determine any effect on price used, a table of contents, and an comparability by examining sales at Verification executive summary of issues should different levels of trade in a single accompany any briefs submitted to the market, the home market. Any price In accordance with section 782(i) of Department. Executive summaries effect must be manifested in a pattern of the Act, we intend to verify all should be limited to five pages total, consistent price differences between information relied upon in making our including footnotes. Further, we request home market sales used for comparison final determination for Yamaha. that parties submitting briefs and rebuttal briefs provide the Department and sales at the equivalent level of trade Suspension of Liquidation of the export transaction. To quantify with a copy of the public version of the price differences, we calculate the In accordance with section 733(d)(2) such briefs on diskette. difference in the average of the net of the Act, we are directing CBP to In accordance with section 774 of the prices of the same models sold at suspend liquidation of all entries of Act, we will hold a public hearing, if different levels of trade. Net prices are outboard engines from Japan that are requested, to afford interested parties an used because any difference will be due entered, or withdrawn from warehouse, opportunity to comment on arguments to differences in level of trade rather for consumption on or after the date of raised in case or rebuttal briefs. If a than other factors. We use the average publication of this notice in the Federal request for a hearing is made, we will difference in net prices to adjust NV Register. We are also instructing CBP to tentatively hold the hearing two days when NV is based on a level of trade require a cash deposit or the posting of after the deadline for submission of different from that of the export sale. If a bond equal to the weighted-average rebuttal briefs at the U.S. Department of there is no pattern of consistent price dumping margin as indicated in the Commerce, 14th Street and Constitution differences, the difference in levels of chart below. These instructions Avenue, NW., Washington, DC 20230, at trade does not have a price effect and, suspending liquidation will remain in a time and in a room to be determined. therefore, no adjustment is necessary. effect until further notice. Parties should confirm by telephone the We found that there were consistent date, time, and location of the hearing price differences between sales to HM2 The weighted-average dumping 48 hours before the scheduled date. margins are provided below: and HM3. Therefore, we made a level- Interested parties who wish to request of-trade adjustment when we were Weighted- a hearing, or to participate in a hearing forced to compare Yamaha’s EP sales to average if one is requested, must submit a Puerto Rico to Yamaha’s sales at HM3. Producer/exporter margin written request to the Assistant However, for Yamaha’s U.S. sales to (percentage) Secretary for Import Administration, Mercury, there was no comparable level U.S. Department of Commerce, Room of trade in the home market. Therefore, Yamaha ...... 22.52 1870, within 30 days of the date of All Others ...... 22.52 we were not able to make a level of publication of this notice. Requests trade adjustment. should contain: (1) The party’s name, Regarding its CEP sales in the United Disclosure address, and telephone number; (2) the States, Yamaha identified three The Department will disclose number of participants; and (3) a list of channels of distribution, claiming that the issues to be discussed. At the the three constitute a single level of calculations performed in accordance with 19 CFR 351.224(b). hearing, oral presentations will be trade: (1) Sales by YMUS to OEM boat limited to issues raised in the briefs. See builders; (2) sales by YMUS to dealers International Trade Commission 19 CFR 351.310(c). The Department will and; (3) sales by G3 to dealers. For CEP Notification make its final determination no later sales, we examined the market than 135 days after the date of processes and selling activities after In accordance with section 733(f) of publication of this preliminary deducting the U.S. selling expenses and the Act, we have notified the ITC of the determination. associated profit. As a result, there are Department’s preliminary affirmative This determination is issued and very few selling activities associated determination. If the final determination published pursuant to sections 733(f) with Yamaha’s CEP sales. Therefore, we in this proceeding is affirmative, the ITC and 777(i)(1) of the Act. preliminarily find that the CEP level of will determine before the later of 120 trade is not comparable to either level days after the date of this preliminary Dated: August 5, 2004. of trade in the home market. determination or 45 days after the final Joseph A. Spetrini, Being unable to quantify a level of determination whether imports of Acting Assistant Secretary for Import trade adjustment for CEP sales, we outboard engines from Japan are Administration. matched, where possible, to weighted- materially injuring, or threaten material [FR Doc. 04–18453 Filed 8–11–04; 8:45 am] average home market sales at the closest injury to, the U.S. industry. BILLING CODE 3510–DS–U
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DEPARTMENT OF COMMERCE Order: Polyethylene Terephthalate Film, with section 751 of the Tariff Act of Sheet, and Strip from India, 67 FR 1930, as amended, (the Act). International Trade Administration 44175 (July 1, 2002) (Amended Final Scope of the Review [A–533–824] Determination and Order). On July 31, 2003, Garware Polyester Ltd., and For purposes of this order, the Certain Polyethylene Terephthalate Global PET films, Inc. (collectively, products covered are all gauges of raw, Film, Sheet and Strip From India: Garware), requested an administrative pretreated, or primed PET film, whether Preliminary Results and Rescission in review of Garware. Garware withdrew extruded or coextruded. Excluded are Part of Antidumping Duty its request for review on August 21, metallized films and other finished Administrative Review 2003. Additionally, on July 31, 2003, films that have had at least one of their Dupont Teijin Films, Mitsubishi surfaces modified by the application of AGENCY: Import Administration, Polyester Film Of America, Toray a performance-enhancing resinous or International Trade Administration, Plastics (America), Inc., and SKC inorganic layer of more than 0.00001 Department of Commerce. America, Inc., (collectively, the inches thick. Imports of PET film are ACTION: Notice of preliminary results petitioners), requested an administrative currently classifiable in the Harmonized and rescission in part of Antidumping review of Polyplex Corporation Ltd. Tariff Schedule of the United States Duty Administrative Review. (Polyplex). Finally, on July 31, 2003, (HTSUS) under item number Jindal Polyester Ltd. (Jindal) and 3920.62.00. HTSUS subheadings are SUMMARY: In response to requests from Valencia Specialty Films (Valencia), a provided for convenience and customs U.S. and Indian interested parties, the U.S. importer, requested an purposes. The written description of the Department of Commerce (the administrative review of Jindal. scope of this order is dispositive. Department) is conducting an The Department initiated an administrative review of the administrative review of Jindal and Verification antidumping duty order on Garware on August 19, 2003, and As provided in section 782(i) of the polyethylene terephthalate film, sheet September 24, 2003, respectively. See Act, the Department verified the sales and strip (PET film) from India. The Initiation of Antidumping and and cost information provided by Jindal, review covers one manufacturer/ Countervailing Duty Administrative as well as information provided by exporter of subject merchandise and the Reviews and Request for Revocation in Valencia, using standard verification period December 21, 2001, through June Part, 68 FR 50750 (August 22, 2003), procedures. Those procedures include 30, 2003. Based upon our analysis, the and Initiation of Antidumping and an examination of relevant sales and Department has preliminarily Countervailing Duty Administrative financial records, and the selection of determined that a dumping margin Reviews, Request for Revocation in Part relevant source documentation as exists for the manufacturer/exporter and Deferral of Administrative Review, exhibits. Our verification findings are covered by this administrative review. If 68 FR 56262 (September 30, 2003) detailed in the following memoranda to these preliminary results are adopted in (Garware was inadvertently not named the file from Jeffrey Pedersen and Drew our final results of administrative in the August 19, 2003, initiation Jackson: ‘‘Export Price and Home review, we will instruct U.S. Customs notice). The Department did not initiate Market Sales Verification Report for and Border Protection (CBP) to assess an administrative review of Polyplex Jindal Polyester Limited (EP Verification antidumping duties as appropriate. because this company was excluded Report); Constructed Export Price Sales Interested parties are invited to from the antidumping duty order on Verification Report for Jindal Polyester comment on these preliminary results of PET film from India. See Letter from Limited (CEP Verification Report); and review. Thomas F. Futtner, Acting Office Cost Verification Report for Jindal EFFECTIVE DATE: August 12, 2004. Director, to Lynn M. Fischer, counsel for Polyester Limited (Cost Verification the petitioners, concerning, Request for Report). The public versions of these FOR FURTHER INFORMATION CONTACT: Jeff Administrative Review of Polyplex, memoranda are on file in the Central Pedersen or Drew Jackson, AD/CVD dated August 6, 2003. Records Unit (CRU), room B–099 of the Enforcement, Office IV, Import On August 1, 2003, the Department Department’s main building. Administration, International Trade issued its antidumping questionnaire to Administration, U.S. Department of Jindal and Garware. Subsequently, the Period of Review Commerce, 14th and Constitution Department issued supplemental The period of review (POR) is Avenue, NW., Washington, DC 20230; questionnaires to Jindal and Valencia. December 21, 2001, through June 30, telephone: (202) 482–2769 or (202) 482– With the exception of Garware, which 2003. 4406, respectively. did not respond to the Department’s Partial Rescission of Review SUPPLEMENTARY INFORMATION: questionnaire because it withdrew its 19 CFR 351.213(d)(1) provides that Background request for review on August 21, 2003, the other parties responded to the the Department will rescind an On July 2, 2003, the Department Department’s questionnaires in a timely administrative review, in whole or in published in the Federal Register a manner. part, if a party that requested a review notice of ‘‘Opportunity to Request On March 22, 2004, the Department withdraws its request within 90 days of Administrative Review’’ of the extended the time limit for the the date of publication of the notice of antidumping duty order on PET film preliminary results of this review until initiation of the requested from India. See Antidumping or July 30, 2004. See Certain Polyethylene administrative review. Garware Countervailing Duty Order, Finding, or Terephthalate Film, Sheet and Strip withdrew its request to be reviewed by Suspended Investigation; Opportunity from India: Extension of Time Limit for the Department before the 90-day time To Request Administrative Review, (68 Preliminary Results of Antidumping period expired and no other parties FR 39511) (July 2, 2003); see also Notice Duty Administrative Review, 69 FR requested an administrative review of of Amended Final Antidumping Duty 17644 (April 5, 2004). Garware. Consequently, the Department Determination of Sales at Less Than The Department is conducting this is rescinding this administrative review Fair Value and Antidumping Duty administrative review in accordance with respect to Garware.
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Affiliation affiliated persons and any relationship available in determining Jindal’s During the POR, Jindal’s affiliated with a person where the respondent is dumping margin. U.S. reseller, Jindal America Inc. (Jindal unsure whether the relationship may In selecting from among the facts America), ceased operations. Jindal result in the person being considered an otherwise available, section 776(b) of employed Jindal America’s president, affiliate. Additionally, the antidumping the Act provides that if the Department Mr. Hotmer, to sell Jindal America’s questionnaire requests information finds that an interested party has failed remaining inventory of PET film. At the regarding sales of subject merchandise to cooperate by not acting to the best of same time, Jindal began selling PET film made by parties in the United States its ability to comply with a request for to Valencia, a company wholly owned that are affiliated with the respondent information, the Department may use an by Mr. Hotmer. (i.e., constructed export price (CEP) inference that is adverse to the interests Section 771(33)(D) of the Act sales, see the definition of CEP sales in of the party. The Act provides that an identifies an employer and its employee Appendix I of the antidumping adverse inference may include reliance as affiliated persons. Jindal employed questionnaire). Despite the definitions on information derived from the Mr. Hotmer during a portion of the POR. and instructions contained in the petition, a final determination in an Although the word ‘‘employee’’ denotes Department’s questionnaire, in its antidumping investigation or review, or a single person, the Court of questionnaire response, Jindal did not any other information placed on the International Trade has recognized that identify Valencia as an affiliate or a record. See sections 776(b)(1), (2), (3), ‘‘words importing the singular may potential affiliate, nor did it report and (4) of the Act. {not} extend and be applied to several Valencia’s sales of Jindal’s PET film Adverse inferences are appropriate persons or things * * * except where it during the time that Jindal employed ‘‘to ensure that the party does not obtain is necessary to carry out the evident Mr. Hotmer. After examining Jindal’s a more favorable result by failing to intent of the statute (emphasis added).’’ questionnaire responses and comments cooperate than if it had cooperated See Ferro Union v. United States, 44 F. filed by the petitioners, the Department fully.’’ See Statement of Administrative Supp. 2d 1310, 1325 (CIT, March 23, determined that additional information Action (SAA) accompanying the 1999) citing First Nat’l Bank in St. Louis was needed regarding Jindal America, Uruguay Round Agreements Act v. Missouri, 263 U.S. 640, 657 44 S. Ct. Mr. Hotmer, and one of Jindal’s (URAA), H. Rep. No. 103–316 at 870 213, 68 L. Ed. 486 (1924). Mr. Hotmer customers, Valencia. Subsequently, on (1994); Borden, Inc. v. United States, 4 is the sole owner of, and performed the November 7, 2003, December 19, 2003, F. Supp. 2d 1221 (CIT 1998); principal selling functions for Valencia, and April 7, 2004, the Department Mannesmannrohren-Werke AG v. a small company that employed no issued supplemental questionnaires to United States, 77 F. Supp. 2d 1302 (CIT more than three people during the POR. Jindal requesting information regarding 1999). The Court of Appeals for the Federal Circuit (CAFC), in Nippon Steel Thus, when Jindal engaged in business Jindal’s relationship with Jindal Corporation v. United States, 337 F. 3d dealings with Valencia while it America, Mr. Hotmer, and Valencia. 1373, 1380 (Fed. Cir. 2003), provided an employed Mr. Hotmer, it was essentially Jindal’s responses to these supplemental explanation of the ‘‘failure to act to the dealing with its employee. The intent of questionnaires contained conflicting best of its ability’’ standard, holding that the statute was to recognize such and inaccurate information that was not the Department need not show relationships. By treating Mr. Hotmer clarified until verification. Thus, the intentional conduct existed on the part and Valencia as one for purposes of our Department did not have the of the respondent, but merely that a affiliation analysis, we give effect to this information needed to make its ‘‘failure to cooperate to the best of a intent. Therefore, the Department has determination regarding Jindal’s respondent’s ability’’ existed, i.e., preliminarily determined that Mr. affiliation with Valencia until late in information was not provided ‘‘under Hotmer and Valencia were affiliated this administrative review, and the circumstances in which it is reasonable with Jindal during the portion of the record lacks sales information regarding to conclude that less than full POR that Jindal employed Mr. Hotmer. Valencia’s sales of Jindal’s PET film cooperation has been shown.’’ Id. For a complete discussion of this issue, during the period that Jindal employed During the course of the instant see the memorandum from Holly A. Mr. Hotmer. administrative review, Jindal initially Kuga, Senior Director, Office IV, to Section 776(a)(1) of the Act provides failed to identify its relationship with Jeffrey A. May, Deputy Assistant that if the necessary information is not Valencia, even though the Department’s Secretary, Group I, concerning, on the record the Department shall use, questionnaire requested such Affiliation and Use of Adverse Facts subject to section 782(d) of the Act, facts information, reported conflicting Available which is dated concurrently otherwise available in reaching the information regarding the relationship, with this notice (Affiliation/AFA applicable determination. Section and reported information regarding the memorandum). 782(d) of the Act requires the relationship that was not clarified until Use of Partial Facts Available Department to inform a party that verification. Thus, Jindal did not submits a deficient response of the cooperate by acting to the best of its Valencia’s Sales nature of the deficiency and to give the ability to comply with the Department’s The Department’s antidumping party an opportunity to correct the requests for information regarding its questionnaire requires respondents to deficiency; however, the Act does relationship with Valencia. Therefore, identify parties with whom they are permit the Department to eventually the Department has preliminarily affiliated, or potentially affiliated (see cease issuing supplemental determined that in selecting from among the definition of affiliated persons in questionnaires if a respondent’s the facts available, an adverse inference Appendix I of the antidumping responses continue to be inadequate and is warranted. As partial adverse facts questionnaire which restates the criteria deficient. Jindal’s questionnaire available, we assigned the highest listed in section 773(33) of the Act). responses continue to be deficient dumping margin calculated in any Specifically, section A of the because the record lacks Valencia’s sales segment of this proceeding to Jindal’s Department’s antidumping information. Therefore, pursuant to sales to Valencia during the portion of questionnaire requests respondents to section 776(a) of the act, we are the POR that Jindal employed Mr. describe all of their relationships with resorting to the use of partial facts Hotmer. For a complete discussion of
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our use of adverse facts available, see there is no indication that Jindal or warranted based on the facts on the the Affiliation/AFA memorandum. Jindal America failed to act to the best record. We calculated EP based on the Section 776(c) of the Act requires that of their abilities in attempting to supply packed, delivered prices charged to the Department, to the extent the documentation required to verify the unaffiliated customers in the United practicable, corroborate secondary per-unit U.S. inland freight expenses for States or to unaffiliated customers for information from independent sources the sales at issue. Therefore, for these exportation to the United States. In that are reasonably at its disposal. preliminary results, we have not made accordance with section 772(c)(2)(A) of Secondary information is defined as an inference that is adverse to Jindal’s the Act, we made deductions from the ‘‘{i}nformation derived from the interests in selecting from among the starting price, where applicable, for petition that gave rise to the facts otherwise available. As partial, foreign movement expenses (including investigation or review, the final non-adverse facts available, the brokerage and handling and inland determination concerning the subject Department replaced the per-unit U.S. freight), international freight, and merchandise, or any previous review inland freight expense reported for CEP marine insurance. Where appropriate under section 751 concerning the sales with a weighted-average, per-unit (see the ‘‘Duty Drawback’’ section subject merchandise.’’ See SAA at 870. U.S. inland freight expense. The below), we added to the starting price The SAA clarifies that ‘‘corroborate’’ Department calculated this weighted- duty drawback received on imported means that the Department will satisfy average freight expense by dividing materials, pursuant to section itself that the secondary information to Jindal America’s total freight expense by 772(c)(1)(B) of the Act. In accordance be used has probative value. See SAA at the total quantity of PET film sold by with section 772(c)(1)(C) of the Act, 870. As noted in Tapered Roller Jindal during the POR and delivered to where appropriate, we increased U.S. Bearings, Four Inches or Less in Outside customers. For additional information price by the countervailing duty (CVD) Diameter, and Components Thereof, on this partial facts available rate attributable to the export subsidies from Japan; Preliminary Results of adjustment, see the Department’s found in the CVD investigation of PET Antidumping Duty Administrative Calculation Memorandum, issued film from India (the ongoing first Reviews and Partial Termination of concurrently with this notice. administrative review of the CVD order Administrative Reviews, 61 FR 57391, has not yet been completed). 57392 (November 6, 1996), to Normal Value Comparisons corroborate secondary information, the To determine whether the Constructed Export Price Department will, to the extent respondent’s sales of PET film to the For Jindal’s sales through Jindal practicable, examine the reliability and United States were made at less than America, we based U.S. price on CEP, relevance of the information. normal value (NV), we compared the as defined in section 772(b) of the Act, The AFA rate used in these export price (EP) and CEP, as because the merchandise was sold, after preliminary results constitutes appropriate, to the NV, as described in importation, by Jindal’s U.S. affiliate, secondary information. However, unlike the ‘‘Export Price,’’ ‘‘Constructed Export Jindal America, to unaffiliated other types of secondary information, Price’’ and ‘‘Normal Value’’ sections of purchasers in the United States.2 We such as input costs or selling expenses, this notice, below. We first attempted to calculated CEP based on delivered there are no independent sources of compare contemporaneous U.S. and prices to unaffiliated customers in the information from which the Department comparison-market sales of products United States. We made deductions can derive calculated dumping margins; that are identical with respect to the from the starting price, where the only source for dumping margins is following characteristics, listed in order appropriate, for foreign and U.S. administrative determinations. The of importance for matching purposes: brokerage and handling, foreign and preliminary AFA rate was calculated in grade, thickness, and surface quality.1 U.S. inland freight, international freight, the investigative phase of this Where we were unable to compare sales marine insurance, U.S. duties, and proceeding using verified information. of identical merchandise, we compared direct and indirect selling expenses to Moreover, this rate reflects recent U.S. sales to comparison-market sales of the extent that they are associated with commercial activity of an Indian the most similar merchandise based on economic activity in the United States company that sold PET film to the the above characteristics. Where there in accordance with sections 772(c)(2)(A) United States. Therefore, we consider were no appropriate sales of foreign like and 772(d)(1)(B) and (D) of the Act. The this rate to be both reliable and relevant. product to compare to a U.S. sale, we direct selling expenses include credit expenses. In accordance with section U.S. Inland Freight Expense compared the price of the U.S. sale to constructed value (CV). 772(d)(3) of the Act, we made a At verification, Jindal America was deduction for CEP profit. unable to substantiate the per-unit Export Price For both EP and CEP, pursuant to inland freight expense reported for its Except for sales through Jindal section 772(c)(1)(C) of the Act, we U.S. sales of subject merchandise. See America, the Department based U.S. increased U.S. price by the amount of CEP Verification Report at 19. Section price on EP, as defined in section 772(a) the export subsidy found in the 776(a)(D) of the Act provides that the of the Act, because the merchandise was countervailing duty investigation of PET Department shall use the facts otherwise sold, prior to importation, to film from India. See Notice of Final available in reaching the applicable unaffiliated purchasers in the United Affirmative Countervailing Duty determination if the information States, or to an unaffiliated purchaser Determination: Polyethylene provided cannot be verified. Thus, for for exportation to the United States, and Terephthalate Film, Sheet, and Strip all CEP sales, we have based the per- CEP methodology was not otherwise (PET Film) From India, 67 FR 34905 unit U.S. inland freight expense on facts (May 16, 2002). We note that the available. Although Jindal America 1 These matching criteria, which differ from those Department is currently conducting a attempted to support the reported U.S. used in the investigative phase of the proceeding, inland freight expenses with available are based on comments from the petitioners and the 2 Although certain sales through Valencia should documentation, it was unable to respondent as well as findings at verification. For have been based on CEP, Jindal failed to report additional information on these matching criteria, these sales and thus, as noted above, the definitively link invoices for U.S. inland see the Department’s Calculation Memorandum Department is basing the margin for these sales on freight to specific U.S. sales. However, issued concurrently with this notice. adverse facts available.
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countervailing duty review of PET film determined that Jindal failed to along the chain of distribution between from India, which will be completed demonstrate that import duties and the producer and the unaffiliated before the Department issues the final rebates are directly linked and customer. If the comparison-market results of this antidumping duty review. dependent upon one another. The DEPS sales are at a different LOT, and the Hence, for the final results of this program does not require a company to difference affects price comparability, as antidumping duty administrative link the DEPS credit granted on the manifested in a pattern of consistent review, we intend to adjust U.S. price to exported merchandise to the import price differences between the sales on reflect any export subsidy found in the duties paid on the types of raw which NV is based and comparison- concurrent countervailing duty review materials used to manufacture the market sales at the LOT of the export of PET film from India. exported product. In fact, at verification, transaction, we make an LOT the Department found that Jindal may adjustment under section 773(a)(7)(A) of Duty Drawback apply the DEPS credit toward the the Act. Finally, for CEP sales, if the NV Jindal reported that it received duty payment of import duties on any type of level is more remote from the factory drawback under both the Advance material (other than illegal or dangerous than the CEP level and there is no basis License program and the Duty materials listed by the GOI) or simply for determining whether the difference Entitlement Passbook Scheme (DEPS). sell the DEPS credit. See the ‘‘DEPS’’ in the levels between NV and CEP The Advance License program allows section of the EP Sales Verification affects price comparability, we adjust Indian companies to import specified Report. While the Department does not NV as provided under section materials duty-free if such materials are require a respondent to link a specific 773(a)(7)(B) of the Act (the CEP offset used to produce a product that is entry of materials on which duties were provision). See Notice of Final exported by the company. According to paid (or which was imported duty-free) Determination of Sales at Less Than information on the record, each advance to a specific export of finished product Fair Value: Certain Cut-to-Length license limits the quantity of each on which the rebate is based, it does Carbon Steel Plate from South Africa, material that may be imported duty-free. require the respondent to demonstrate 62 FR 61731 (November 19, 1997). No customs duties are paid on the that the imported materials are of the In determining whether separate imported materials; however, there is a same type used to produce the exported LOTs exist, we obtained information contingent liability for the unpaid product. Further, the Department will regarding the marketing stages for the duties. This contingent liability is only grant a duty drawback adjustment reported home market and U.S. sales, extinguished by exporting finished if the rebated import duty is on including a description of the selling products containing the types of materials used to produce subject activities performed by Jindal and Jindal materials covered by the advance merchandise. Jindal made no attempt to America for each channel of license. Under the DEPS program, link the quantity of materials imported distribution. We generally expect that, if Indian companies are granted a credit under the DEPS program with the claimed LOTs are the same, the selling which is equivalent to 14 percent of the quantity of materials consumed in functions and activities of the seller at free-on-board (FOB) value of their producing exported PET film. See the each level should be similar. exports. These companies then use this ‘‘DEPS’’ section of the EP Sales Conversely, if a party claims that LOTs credit to offset the customs duty paid on Verification Report. Based on the are different for different groups of imported materials used to manufacture foregoing, the Department has not sales, the selling functions and activities exported products. increased Jindal’s reported U.S. sales of the seller for each group should be Before increasing a respondent’s prices by the amount of duty drawback dissimilar. Based on our comparisons of reported U.S. sales prices by the amount granted under the DEPS program. Jindal’s direct sales to unaffiliated of duty drawback, pursuant to section customers and its sales through Jindal 772(c)(1)(B) of the Act, the Department’s Level of Trade (LOT) America, we have determined that the practice is to examine whether: (1) In accordance with section U.S. sales are at two different LOTs. Import duties and rebates are directly 773(a)(1)(B) of the Act, to the extent Jindal reported home market sales to linked to and are dependent upon one practicable, we determine NV based on two categories of customers through two another, and (2) the company claiming sales in the comparison market at the channels of distribution. However, the the adjustment can demonstrate that same LOT as the EP or CEP sales. The record indicates that the sales processes there are sufficient imports of raw NV LOT is that of the starting-price for all home market sales are essentially materials to account for the duty sales in the comparison market or, when the same. Therefore, we have drawback received on exports of the NV is based on CV, that of the sales preliminarily determined that, during manufactured product. See Steel Wire from which we derive selling, general, the POR, Jindal sold foreign like product Rope from the Republic of Korea; Final and administrative (SG&A) expenses in the home market at one LOT. Results of Antidumping Duty and profit. For EP sales, the U.S. LOT The Department then compared the Administrative Review, 61 FR 55965, is also the level of the starting-price LOT of Jindal’s home market sales to the 55968 (October 30, 1996). sale. For CEP sales, it is the level of the LOT of its direct sales to unaffiliated With regard to Jindal’s experience constructed sale from the exporter to the U.S. customers. Based on this under the Advance License program, the importer. The Department adjusts the comparison, the Department has Department has preliminarily CEP, pursuant to section 772(d) of the determined that Jindal’s home market determined that import duties and Act, prior to performing the LOT sales were made at the same LOT as its rebates are directly linked and analysis, as articulated by the direct sales to unaffiliated U.S. dependent upon one another and Jindal Department’s regulations at section customers. Therefore, the Department imported sufficient quantities of raw 351.412. See Micron Technology, Inc. v. has preliminarily determined that no materials to account for the duty United States, 243 F.3rd 1301, 1315 LOT adjustment for Jindal’s sales to drawback granted. Accordingly, the (Fed. Cir. 2001). unaffiliated U.S. customers is Department has added an amount for To determine whether NV sales are at warranted. duty drawback to EP and CEP. a different LOT than the EP or CEP Additionally, we have preliminarily With regard to the DEPS program, the sales, we examine stages in the determined that Jindal’s sales to its Department has preliminarily marketing process and selling activities unaffiliated customers in the home
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market were not made at an LOT that is charges, direct selling expenses, and in substantial quantities within an more advanced than its sales to its U.S. packing. Pursuant to 19 CFR 351.403(c), extended period of time (i.e., a period of affiliate, and therefore, a CEP offset and in accordance with the one year). Further, because we adjustment is not warranted.3 See Department’s practice, when the prices compared prices to POR-average costs, Memorandum to the file from the Team charged to an affiliated party were, on we determined that the below-cost to the File, concerning, Level of Trade average, between 98 and 102 percent of prices would not permit recovery of all Analysis: Jindal Polyester Limited the prices charged to unaffiliated parties costs within a reasonable time period, which is dated concurrently with this for merchandise comparable to that sold and thus, we disregarded the below-cost notice. to the affiliated party, we determined sales in accordance with sections that the sales to the affiliated party were 773(b)(1) and (2) of the Act. Normal Value at arm’s-length prices. See Antidumping We found that for certain products, After testing home market viability, Proceedings: Affiliated Party Sales in Jindal made home market sales at prices whether home market sales to affiliates the Ordinary Course of Trade, 67 FR below the COP within an extended were at arm’s-length prices, and 69186 (November 15, 2002). We period of time in substantial quantities. whether comparison-market sales failed included in our NV calculations all Further, we found that these sales prices the cost test, we calculated NV as noted sales to an affiliated party if sales to the did not permit the recovery of costs in the subsections, ‘‘Price-to-Price affiliate were made at an arm’s-length within a reasonable period of time. Comparisons’’ and ‘‘Price-to-CV price. Therefore, we excluded these sales from Comparisons,’’ below. our analysis in accordance with section Cost of Production Analysis 773(b)(1) of the Act. Home Market Viability On October 15, 2003, the petitioners Price-to-Price Comparisons. Where it In order to determine whether there is alleged that, during the POR, Jindal was appropriate to base NV on prices, a sufficient volume of sales in the home made home market sales of PET film at we used the prices at which the foreign market to serve as a viable basis for prices below the cost of production like product was first sold for calculating NV (i.e., whether the (COP). After finding that the petitioners’ consumption in India, in the usual aggregate volume of home market sales allegation provided reasonable grounds commercial quantities, in the ordinary of the foreign like product is equal to or to initiate a COP investigation, the course of trade, and, to the extent greater than five percent of the aggregate Department, pursuant to section 773(b) possible, at the same LOT as the volume of U.S. sales), we compared the of the Act, initiated a COP investigation comparison EP or CEP sale. respondent’s volume of home market of Jindal. We conducted the COP We determined price-based NVs for sales of the foreign like product to the analysis as described below. Jindal as follows: we calculated NV volume of its U.S. sales of subject based on packed, delivered and ex- A. Calculation of COP merchandise, in accordance with factory prices to home market section 773(a)(1) of the Act. Because the In accordance with section 773(b)(3) customers. Where appropriate, we respondent’s aggregate volume of home of the Act, we calculated the weighted- increased the starting price for interest market sales of the foreign like product average COP, by model, for the POR, revenue. We made deductions from the is greater than five percent of its based on the sum of materials and starting price for foreign inland freight, aggregate volume of U.S. sales of subject fabrication costs, SG&A expenses, and where appropriate, pursuant to sections merchandise, we determined that the packing costs. 773(a)(6)(B)(ii) of the Act. Pursuant to section 773(a)(6)(C)(iii) of the Act and home market is viable for the B. Test of Home Market Sales Prices respondent, and have used the home 19 CFR 351.410(c), we made market as the comparison-market. As required under section 773(b) of circumstance-of-sale adjustments to the the Act, we compared the weighted- starting price, where appropriate, for Affiliated-Party Transactions and average COPs to the home market sales differences in credit and bank expenses. Arm’s-Length Test prices of the foreign like product, in We deducted home market packing The Department may calculate NV order to determine whether these sales costs from, and added U.S. packing based on a sale to an affiliated party had been made at prices below the COP costs to, the starting price, in only if it is satisfied that the price to the within an extended period of time in accordance with sections 773(a)(6)(A) affiliated party is comparable to the substantial quantities, and whether such and (B) of the Act. Where appropriate, prices at which sales are made to parties prices were sufficient to permit the we made adjustments to NV to account not affiliated with the producer, i.e., recovery of all costs within a reasonable for differences in the physical sales at arm’s-length. See section period of time. On a product-specific characteristics of the merchandise sold 773(f)(2) of the Act; 19 CFR 351.403(c). basis, we compared the COP to home in the U.S. and home market, in Where the home market prices charged market sales prices, less any applicable accordance with section 773(a)(6)(C)(ii) to an affiliated customer were, on movement charges and direct and of the Act and 19 CFR 351.411. In average, found not to be arm’s-length indirect selling expenses. accordance with the Department’s practice, where all contemporaneous prices, sales to the affiliated customer C. Results of the COP Test were excluded from our analysis. Jindal matches to a U.S. sale resulted in Pursuant to section 773(b)(2)(C) of the reported one sale of the foreign like difference-in-merchandise adjustments Act, where less than 20 percent of product to an affiliated end-user. To test exceeding 20 percent of the cost of Jindal’s sales of a given product were whether this sale was made at an arm’s- manufacturing (COM) the U.S. product, made at prices below the COP, we did length price, the Department compared we based NV on CV. not disregard any below-cost sales of Price-to-CV Comparisons. In the price of this sale to sales of that product because the below-cost accordance with section 773(a)(4) of the comparable merchandise to unaffiliated sales were not made in ‘‘substantial Act, we based NV on CV when we were customers, net of all rebates, movement quantities.’’ Where 20 percent or more unable to compare the U.S. sale to a 3 Jindal stated in its response to section A of the of Jindal’s sales of a given product were home market sale of an identical or Department’s questionnaire that it was not made at prices below the COP, we similar product. For each unique PET requesting a CEP offset. determined that such sales were made film product sold by the respondent in
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the United States during the POR, we Department will issue the final results final results of the next administrative calculated a weighted-average CV based of this administrative review, which review. on the sum of the respondent’s materials will include the results of its analysis of Notification to Importers and fabrication costs, SG&A expenses, issues raised in any written comments, including interest expenses, packing within 120 days from the publication This notice also serves as a costs, and profit. In accordance with date of this notice. preliminary reminder to importers of their responsibility under 19 CFR section 773(e)(2)(A) of the Act, we based Assessment Rate SG&A expenses and profit on the 351.402(f)(2) to file a certificate amounts incurred and realized by the Upon completion of this regarding the reimbursement of respondent in connection with the administrative review, the Department antidumping duties prior to liquidation production and sale of the foreign like will determine, and CBP shall assess, of the relevant entries during this product, in the ordinary course of trade, antidumping duties on all appropriate review period. Failure to comply with for consumption in India. We based entries. In accordance with 19 CFR this requirement could result in the selling expenses on weighted-average 351.212(b)(1), when possible, we Secretary’s presumption that actual home market direct and indirect calculated an importer-specific reimbursement of the antidumping selling expenses. In calculating CV, we assessment rate for merchandise subject duties occurred and the subsequent adjusted the reported costs as described to this review. Where the importer- assessment of double antidumping in the COP section above. specific assessment rate is above de duties. Currency Conversion. Pursuant to minimis, we will instruct CBP to assess This administrative review and this section 773A(a) of the Act, we converted the importer-specific rate uniformly on notice are in accordance with sections amounts expressed in foreign currencies the entered customs value of all entries 751(a)(1) and 777(i)(1) of the Act. into U.S. dollar amounts based on the of subject merchandise made by the Dated: July 30, 2004. exchange rates in effect on the dates of importer during the POR. When it was James J. Jochum, the U.S. sales, as certified by the Federal not possible to calculate an importer- Assistant Secretary for Import Reserve Bank. specific assessment rate because the Administration. importer was not known, we calculated [FR Doc. 04–18404 Filed 8–11–04; 8:45 am] Preliminary Results of Review an exporter-specific ad valorem BILLING CODE 3510–DS–P As a result of this review, we assessment rate. The Department will preliminarily determine that the issue appropriate assessment following weighted-average dumping instructions directly to CBP within 15 DEPARTMENT OF COMMERCE margin exists for the period December days of publication of the final results 21, 2001, through June 30, 2003: of review. National Oceanic and Atmospheric Cash Deposit Requirements Administration Margin [I.D. 080904A] Manufacturer/exporter (percent) The following cash deposit requirements will be effective for all Gulf of Mexico Fishery Management Jindal Polyester Ltd...... 9.59 shipments of the subject merchandise Council; Public Meeting entered, or withdrawn from warehouse, We will disclose the calculations used for consumption on or after the AGENCY: National Marine Fisheries in our analysis to parties to this publication date of the final results of Service (NMFS), National Oceanic and proceeding within 10 days of publicly the instant administrative review, as Atmospheric Administration (NOAA), announcing the preliminary results of provided by section 751(a)(1) of the Act: Commerce. review. See 19 CFR 351.224(b). Any (1) The cash deposit rate for the ACTION: Notice of public meeting. interested party may request a hearing reviewed company will be the rate within 30 days of the publication date established in the final results (except SUMMARY: The Gulf of Mexico Fishery of this notice. See 19 CFR 351.310(c). If that if the rate is de minimis, i.e., less Management Council (Council) will requested, a hearing will be held 44 than 0.5 percent, no cash deposit will be convene a public meeting of the days after the date of publication of this required); (2) for previously investigated Aquaculture Advisory Panel (AP) to notice, or the first workday thereafter. or reviewed companies not listed above, redraft the Generic Amendment Interested parties are invited to the cash deposit rate will continue to be Providing for Regulation of Offshore comment on the preliminary results. the company-specific rate published for Marine Aquaculture in August 2004. The Department will consider case the most recent period; (3) if the DATES: The Council’s Aquaculture briefs filed by interested parties within exporter is not a firm covered in this Advisory Panel will convene from 1 30 days of the date of publication of this review, a prior review, or the less than p.m. on August 25, 2004 and conclude notice. Also, interested parties may file fair value (LTFV) investigation, but the no later than 3 p.m. on August 26, 2004 rebuttal briefs, limited to issues raised manufacturer is, the cash deposit rate (see ADDRESSES for the meeting in the case briefs. The Department will will be the rate established for the most location). consider rebuttal briefs filed not later recent period for the manufacturer of ADDRESSES: The meeting will be held at than five days after the deadline for the merchandise; and (4) the cash the Saint Louis Hotel, 730 Rue filing case briefs. Parties who submit deposit rate for all other manufacturers Bienville, New Orleans, LA; telephone: arguments are requested to submit with or exporters will continue to be the ‘‘all 888–508–3980 (see DATES for the each argument: (1) A statement of the others’’ rate of 5.71 percent, which is meeting date and time). issue, (2) a brief summary of the the ‘‘all others’’ rate established in the Copies of the discussion material for argument and (3) a table of authorities. LTFV investigation, adjusted for the this meeting may be obtained by calling Further, we ask that parties submitting export subsidy rate in the countervailing 813–228–2815. written comments provide the duty investigation. See Amended Final Council address: Gulf of Mexico Department with a copy of the public Determination and Order. These deposit Fishery Management Council, 3018 U.S. version of any such comments on a requirements, when imposed, shall Highway 301 North, Suite 1000, Tampa, diskette. Unless extended, the remain in effect until publication of the FL 33619.
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FOR FURTHER INFORMATION CONTACT: DEPARTMENT OF COMMERCE The Gulf of Mexico Fishery Wayne Swingle, Executive Director, Management Council is one of eight Gulf of Mexico Fishery Management National Oceanic and Atmospheric regional fishery management councils Council, 3018 U.S. Highway 301 North, Administration that were established by the Magnuson- Suite 1000, Tampa, FL 33619; [I.D. 080904C] Stevens Act of 1976. The Gulf of Mexico telephone: 813–228–2815. Fishery Management Council prepares Gulf of Mexico Fishery Management fishery management plans that are SUPPLEMENTARY INFORMATION: The AP designed to manage fishery resources in consists largely of scientists with Council; Public Meeting the U.S. Gulf of Mexico. expertise in marine aquaculture. The AP AGENCY: National Marine Fisheries See ADDRESSES to obtain copies of the will be redrafting the Generic Service (NMFS), National Oceanic and discussion material for this meeting. Amendment Providing for Regulation of Atmospheric Administration (NOAA), Although non-emergency issues not Offshore Marine Aquaculture Commerce. contained in the agenda may come (Amendment). The draft amendment ACTION: Notice of public meeting. before this group for discussion, those contains scientific information on the issues may not be the subject of formal SUMMARY: The Gulf of Mexico Fishery culture of marine fish and on the action during this meeting. Action will Management Council (Council) will environmental effects of such be restricted to those issues specifically convene a public meeting of the Finfish aquaculture. The amendment also identified in this notice and any issues Stock Assessment Panel (FSAP) to contains many alternatives that could be arising after publication of this notice review proposed revisions to the used to regulate aquaculture by best that require emergency action under regulations serving as guidelines for management practices (BMP). The section 305(c) of the Magnuson-Stevens interpreting National Standard One Council solicited public comment on Fishery Conservation and Management under the Magnuson-Stevens Fishery the draft amendment in eight scoping Act, provided the public has been Conservation and Management Act hearings. The AP will consider these notified of the Council’s intent to take (Magnuson-Stevens Act) in August public recommendations in redrafting final action to address the emergency. the amendment. 2004. The Gulf of Mexico Fishery DATES: The Council’s FSAP will Special Accommodations Management Council is one of eight convene from 1 p.m. to 4:30 p.m. on The meeting is open to the public and regional fishery management councils August 30, 2004. is physically accessible to people with that were established by the Magnuson- ADDRESSES: The meeting will be held at disabilities. Requests for sign language Stevens Fishery Conservation and the DoubleTree Guest Suites Tampa interpretation or other auxiliary aids Management Act of 1976. The Gulf of Bay, 3050 North Rocky Point Drive should be directed to Dawn Aring at the Mexico Fishery Management Council West, Tampa, FL; telephone: 813–888– Council (see ADDRESSES) by August 13, prepares fishery management plans that 8800. 2004. are designed to manage fishery Copies of the discussion material for Dated: August 9, 2004. resources in the U.S. Gulf of Mexico. this meeting may be obtained by calling Alan D. Risenhoover, See ADDRESSES for copies of the 813–228–2815. Acting Director, Office of Sustainable discussion material for this meeting. Council address: Gulf of Mexico Fisheries, National Marine Fisheries Service. Although non-emergency issues not Fishery Management Council, 3018 U.S. [FR Doc. E4–1811 Filed 8–11–04; 8:45 am] Highway 301 North, Suite 1000, Tampa, contained in this agenda may come BILLING CODE before this group for discussion, those FL 33619. issues may not be the subject of formal FOR FURTHER INFORMATION CONTACT: action during this meeting. Action will Wayne Swingle, Executive Director, COMMITTEE FOR THE be restricted to those issues specifically Gulf of Mexico Fishery Management IMPLEMENTATION OF TEXTILE identified in this notice and any issues Council, 3018 U.S. Highway 301 North, AGREEMENTS arising after publication of this notice Suite 1000, Tampa, FL 33619; that require emergency action under telephone: 813–228–2815. Revision of Limitations of Duty- and section 305(c) of the Magnuson-Stevens SUPPLEMENTARY INFORMATION: National Quota-Free Imports of Apparel Articles Fishery Conservation and Management Standard One of the Magnuson-Stevens Assembled in Beneficiary Sub-Saharan Act, provided the public has been Act provides management will prevent African Countries from Regional and notified of the Council’s intent to take overfishing while achieving optimum Third-Country Fabric for the 12-Month final action to address the emergency. yield from fishery stocks. The Period October 1, 2003 through guidelines for this standard provide Special Accommodations September 30, 2004 technical guidance on assessing the August 9, 2004. The meeting is open to the public and status of stocks, preventing overfishing AGENCY: Committee for the is physically accessible to people with and rebuilding overfished stocks. NOAA Implementation of Textile Agreements disabilities. Requests for sign language Fisheries, after scientific review, is (CITA). interpretation or other auxiliary aids preparing to amend the guidelines. The should be directed to Dawn Aring at the Council’s FSAP consists of scientists ACTION: Publishing Revisions to the Council (see ADDRESSES) by August 13, with expertise on management of Fourth 12-Month Cap on Duty- and 2004. fishery stocks and mathematically Quota-Free Benefits. assessing the status of such stocks. The Dated: August 9, 2004. FSAP will review the revisions EFFECTIVE DATE: August 12, 2004. Alan D. Risenhoover, proposed by NOAA Fisheries and make FOR FURTHER INFORMATION CONTACT: Acting Director, Office of Sustainable their recommendations to the Council Anna Flaaten, International Trade Fisheries, National Marine Fisheries Service. on the scientific merit of the proposed Specialist, Office of Textiles and [FR Doc. E4–1783 Filed 8–11–04; 8:45 am] changes and/or the need for additional Apparel, U.S. Department of Commerce, BILLING CODE changes. (202) 482-3400.
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SUPPLEMENTARY INFORMATION: expiration of the quantitative review as required by the Paperwork Authority: Title I, Section 112(b)(3) of the limitations. It also amended the Reduction Act of 1995. Trade and Development Act of 2000, as percentage to be used in calculating the DATES: Interested persons are invited to amended by Section 3108 of the Trade Act cap for the twelve-month period that submit comments on or before of 2002 and Section 7(b)(2) of the AGOA began on October 1, 2003 and extends September 13, 2004. Acceleration Act of 2004; Presidential through September 30, 2004. The new ADDRESSES: Written comments should Proclamation 7350 of October 4, 2000 (65 FR percentage is 4.747. The sub-cap be addressed to the Office of 59321); Presidential Proclamation 7626 of applicable for apparel articles under the November 13, 2002 (67 FR 69459). Information and Regulatory Affairs, Title I of the Trade and Development special rule for lesser-developed Attention: Carolyn Lovett, Desk Officer, Act of 2000 (TDA 2000) provides for countries remains unchanged for this Department of Education, Office of duty- and quota-free treatment for twelve-month period. Management and Budget, 725 17th certain textile and apparel articles Presidential Proclamation 7350 Street, NW., Room 10235, New imported from designated beneficiary directed CITA to publish the aggregate Executive Office Building, Washington, sub-Saharan African countries. Section quantity of imports allowed during each DC 20503 or faxed to (202) 395–6974. 112(b)(3) of TDA 2000 provides duty- 12-month period in the Federal Register. SUPPLEMENTARY INFORMATION: Section and quota-free treatment for apparel Presidential Proclamation 7626, 3506 of the Paperwork Reduction Act of articles wholly assembled in one or published on November 18, 2002, 1995 (44 U.S.C. Chapter 35) requires more beneficiary sub-Saharan African modified the aggregate quantity of that the Office of Management and countries from fabric wholly formed in imports allowed during each 12-month Budget (OMB) provide interested one or more beneficiary countries from period. On September 16, 2003, CITA Federal agencies and the public an early yarn originating in the U.S. or one or published the cap for the 12-month opportunity to comment on information more beneficiary countries. This period from October 1, 2003 to collection requests. OMB may amend or preferential treatment is also available September 30, 2004. waive the requirement for public for apparel articles assembled in one or For the twelve-month period that consultation to the extent that public more lesser-developed beneficiary sub- began on October 1, 2003 and extends participation in the approval process Saharan African countries, regardless of through September 30, 2004, the would defeat the purpose of the the country of origin of the fabric used aggregate quantity of imports eligible for information collection, violate State or to make such articles. TDA 2000 preferential treatment under these Federal law, or substantially interfere imposed a quantitative limitation on provisions is revised to 947,368,444 with any agency’s ability to perform its imports eligible for preferential square meters equivalent. Of this statutory obligations. The Leader, treatment under these two provisions. amount, 470,411,241 square meters Regulatory Information Management The Trade Act of 2002 amended TDA equivalent is available to apparel Group, Office of the Chief Information 2000 to extend preferential treatment to imported under the special rule for Officer, publishes that notice containing apparel assembled in a beneficiary sub- lesser-developed countries. These proposed information collection Saharan African country from quantities will be recalculated for each requests prior to submission of these components knit-to-shape in a subsequent year. Apparel articles requests to OMB. Each proposed beneficiary country from U.S. or entered in excess of these quantities will information collection, grouped by beneficiary country yarns and to apparel be subject to otherwise applicable office, contains the following: (1) Type formed on seamless knitting machines tariffs. of review requested, e.g., new, revision, in a beneficiary country from U.S. or These quantities are calculated using extension, existing or reinstatement; (2) beneficiary country yarns, subject to the the aggregate square meter equivalents Title; (3) Summary of the collection; (4) quantitative limitation. The Trade Act of of all apparel articles imported into the Description of the need for, and 2002 also increased the quantitative United States, derived from the set of proposed use of, the information; (5) limitation but provided that this Harmonized System lines listed in the Respondents and frequency of increase would not apply to apparel Annex to the World Trade Organization collection; and (6) Reporting and/or imported under the special rule for Agreement on Textiles and Clothing Recordkeeping burden. OMB invites lesser-developed countries. The Trade (ATC), and the conversion factors for public comment. Act of 2002 provided that the units of measure into square meter quantitative limitation for the year equivalents used by the United States in Dated: August 9, 2004. beginning October 1, 2003 would be an implementing the ATC. Angela C. Arrington, Leader, Regulatory Information Management amount not to exceed 4.7931 percent of D. Michael Hutchinson, Group, Office of the Chief Information Officer. the aggregate square meter equivalents Acting Chairman, Committee for the of all apparel articles imported into the Implementation of Textile Agreements. Office of Vocational and Adult United States in the preceding 12-month [FR Doc.04–18468 Filed 8–11–04; 8:45 am] Education period for which data are available. Of BILLING CODE 3510–DR–S Type of Review: Extension. this overall amount, apparel imported Title: Adult Education and Family under the special rule for lesser- Literacy Act State Plan (PL 105–220). developed countries is limited to an Frequency: Annually. amount not to exceed 2.3571 percent of DEPARTMENT OF EDUCATION Affected Public: State, Local, or Tribal apparel imported into the United States Gov’t, SEAs or LEAs. in the preceding 12-month period. For Submission for OMB Review; Reporting and Recordkeeping Hour the purpose of the calculation of the 12- Comment Request Burden: month period that began on October 1, Responses: 59. 2003 , the most recent 12-month period AGENCY: Department of Education. Burden Hours: 2,655. for which data were available was the SUMMARY: The Leader, Regulatory Abstract: It is unlikely that Congress 12-month period ending July 31, 2003. Information Management Group, Office will pass a reauthorization of the Section 7(b)(2)(B)(ii)(I) of the AGOA of the Chief Information Officer invites Workforce Investment Act (WIA) this Acceleration Act of 2004 extended the comments on the submission for OMB year. Therefore, the enclosed Policy
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Memorandum is designed to advise liability by Boston Generating should tendered for filing as part of its FERC states about how to continue their adult file a motion to intervene or protest with Gas Tariff, Volume No. 1 the following education program under Section 422 of the Federal Energy Regulatory tariff sheets, to become effective the General Education Provisions Act Commission, 888 First Street, NE., September 1, 2004: (GEPA) [20 U.S.C. 1226 (a)]. Washington, DC 20426, in accordance First Revised Sheet No. 6B Requests for copies of the submission with Rules 211 and 214 of the Third Revised Sheet No. 13 for OMB review; comment request may Commission’s Rules of Practice and First Revised Sheet No. 25A be accessed from http:// Procedure (18 CFR 385.211 and Chandeleur tendered this filing in edicsweb.ed.gov, by selecting the 385.214). order to modify certain tariff provisions ‘‘Browse Pending Collections’’ link and Notice is hereby given that the to more accurately reflect Chandeleur’s by clicking on link number 2555. When deadline for filing motions to intervene operating practices. you access the information collection, or protest is August 30, 2004. Chandeleur states that Sheet Nos. 6B Absent a request to be heard in click on ‘‘Download Attachments’’ to and 13 replace the word ‘‘deliveries’’ opposition by the deadline above, view. Written requests for information with the word ‘‘transportation’’ to Boston Generating is authorized to issue should be addressed to U.S. Department reflect Chandeleur’s practice of billing securities and assume obligations or of Education, 400 Maryland Avenue, transportation based on volumes liabilities as a guarantor, indorser, SW., Potomac Center, 9th Floor, received. Additionally, Chandeleur surety, or otherwise in respect of any Washington, DC 20202–4700. Requests states that it has added a paragraph security of another person; provided may also be electronically mailed to the allowing for the use of discretion in _ that such issuance or assumption is for Internet address OCIO [email protected] or enforcing gas quality specifications in some lawful object within the corporate faxed to 202–245–6621. Please specify order to ensure that all supplies within purposes of Boston Generating, the complete title of the information a reasonable range of quality remain compatible with the public interest, and collection when making your request. eligible for transportation. Comments regarding burden and/or is reasonably necessary or appropriate Any person desiring to intervene or to the collection activity requirements for such purposes. protest this filing must file in should be directed to Sheila Carey at The Commission reserves the right to accordance with Rules 211 and 214 of [email protected]. Individuals who require a further showing that neither the Commission’s Rules of Practice and use a telecommunications device for the public nor private interests will be Procedure (18 CFR 385.211 and deaf (TDD) may call the Federal adversely affected by continued 385.214). Protests will be considered by Information Relay Service (FIRS) at 1– approval of Boston Generating’s the Commission in determining the 800–877–8339. issuances of securities or assumptions of appropriate action to be taken, but will liability. not serve to make protestants parties to [FR Doc. 04–18444 Filed 8–11–04; 8:45 am] Copies of the full text of the Director’s the proceeding. Any person wishing to BILLING CODE 4000–01–P Order are available from the become a party must file a notice of Commission’s Public Reference Room, intervention or motion to intervene, as 888 First Street, NE., Washington, DC appropriate. Such notices, motions, or DEPARTMENT OF ENERGY 20426. The Order may also be viewed protests must be filed in accordance on the Commission’s Web site at http:/ Federal Energy Regulatory with the provisions of Section 154.210 /www.ferc.gov, using the eLibrary link. Commission of the Commission’s regulations (18 CFR Enter the docket number excluding the 154.210). Anyone filing an intervention [Docket No. ER04–994–000] last three digits in the docket number or protest must serve a copy of that filed to access the document. document on the Applicant. Anyone Boston Generating, LLC; Notice of Comments, protests, and interventions filing an intervention or protest on or Issuance of Order may be filed electronically via the before the intervention or protest date internet in lieu of paper. See, 18 CFR August 6, 2004. need not serve motions to intervene or 385.2001(a)(1)(iii) and the instructions Boston Generating, LLC (Boston protests on persons other than the on the Commission’s Web site under the Generating) filed an application for Applicant. market-based rate authority, with an ‘‘e-Filing’’ link. The Commission The Commission encourages accompanying tariff. The proposed tariff strongly encourages electronic filings. electronic submission of protests and provides for wholesale sales of capacity, Magalie R. Salas, interventions in lieu of paper using the energy, and ancillary services at market- Secretary. ‘‘eFiling’’ link at http://www.ferc.gov. based rates. Boston Generating also [FR Doc. E4–1789 Filed 8–11–04; 8:45 am] Persons unable to file electronically requested waiver of various Commission BILLING CODE 6717–01–P should submit an original and 14 copies regulations. In particular, Boston of the protest or intervention to the Generating requested that the Federal Energy Regulatory Commission, Commission grant blanket approval DEPARTMENT OF ENERGY 888 First Street, NE., Washington, DC under 18 CFR part 34 of all future 20426. issuances of securities and assumptions Federal Energy Regulatory This filing is accessible on-line at of liability by Boston Generating. Commission http://www.ferc.gov, using the On July 30, 2004, pursuant to ‘‘eLibrary’’ link and is available for [Docket No. RP04–438–000] delegated authority, the Director, review in the Commission’s Public Division of Tariffs and Market Chandeleur Pipe Line Company; Reference Room in Washington, DC. Development—South, granted the Notice of Proposed Changes in FERC There is an ‘‘eSubscription’’ link on the request for blanket approval under part Gas Tariff Web site that enables subscribers to 34, subject to the following: receive e-mail notification when a Any person desiring to be heard or to August 5, 2004. document is added to a subscribed protest the blanket approval of Take notice that on August 3, 2004, docket(s). For assistance with any FERC issuances of securities or assumptions of Chandeleur Pipe Line Company Online service, please e-mail
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[email protected], or call Federal Energy Regulatory Commission, document on all the parties to the (866) 208–3676 (toll free). For TTY, call 888 First Street, NE., Washington, DC proceeding. (202) 502–8659. 20426. The Commission encourages This filing is accessible on-line at electronic submission of protests in lieu Magalie R. Salas, http://www.ferc.gov, using the of paper using the ‘‘eFiling’’ link at Secretary. ‘‘eLibrary’’ link and is available for http://www.ferc.gov. Persons unable to [FR Doc. E4–1809 Filed 8–11–04; 8:45 am] review in the Commission’s Public file electronically should submit an BILLING CODE 6717–01–P Reference Room in Washington, DC. original and 14 copies of the protest to There is an ‘‘eSubscription’’ link on the the Federal Energy Regulatory Web site that enables subscribers to Commission, 888 First Street, NE., DEPARTMENT OF ENERGY receive e-mail notification when a Washington, DC 20426. Federal Energy Regulatory document is added to a subscribed This filing is accessible on-line at Commission docket(s). For assistance with any FERC http://www.ferc.gov, using the Online service, please e-mail ‘‘eLibrary’’ link and is available for [Docket No. RP04–439–000] [email protected], or call review in the Commission’s Public (866) 208–3676 (toll free). For TTY, call Reference Room in Washington, DC. Notice of Tariff Filing; Clear Creek (202) 502–8659. There is an ‘‘eSubscription’’ link on the Storage Company, L.L.C. Web site that enables subscribers to Magalie R. Salas, August 5, 2004. receive e-mail notification when a Secretary. document is added to a subscribed Take notice that on August 4, 2004, [FR Doc. E4–1796 Filed 8–11–04; 8:45 am] Clear Creek Storage Company, L.L.C., docket(s). For assistance with any FERC BILLING CODE 6717–01–P (Clear Creek) tendered for filing to Online service, please e-mail become part of its FERC Gas Tariff, [email protected], or call (866) 208–3676 (toll free). For TTY, call Original Volume No. 1, the Title Page DEPARTMENT OF ENERGY and First Revised Sheet No. 72, to be (202) 502–8659. Protest Date: 5 p.m. eastern time on effective September 3, 2004. Federal Energy Regulatory August 13, 2004. Clear Creek states that the purpose of Commission this tariff filing is to update the Title Magalie R. Salas, Page and the names of officers and [Docket No. RP91–161–032] Secretary. shared employees on First Revised [FR Doc. E4–1784 Filed 8–11–04; 8:45 am] Sheet No. 72 of Clear Creek’s tariff. Columbia Gas Transmission BILLING CODE 6717–01–P These changes are required due to Corporation; Notice of Refunds employee retirements. Clear Creek states further that a copy August 6, 2004. DEPARTMENT OF ENERGY of this filing has been served upon its Take notice that on July 20, 2004, customers and the Public Service Columbia Gas Transmission Corporation Federal Energy Regulatory Commission of Wyoming. (Columbia) filed to report on the flow- Commission Any person desiring to intervene or to back to customers of funds received [Docket No. RP00–632–013] protest this filing must file in from insurance carriers for accordance with Rules 211 and 214 of environmental costs attributable to Dominion Transmission, Inc.; Notice of the Commission’s Rules of Practice and Columbia’s Docket No. RP91–161 Fuel Report Procedure (18 CFR 385.211 and settlement period. 385.214). Protests will be considered by Columbia states that it allocated such August 5, 2004. the Commission in determining the recoveries among customers based on Take notice that on June 30, 2004, appropriate action to be taken, but will their fixed cost responsibility for Dominion Transmission, Inc. (DTI) not serve to make protestants parties to services on the Columbia system during tendered for filing its informational fuel the proceeding. Any person wishing to the period December 1, 1991, through report. DTI states that the fuel report become a party must file a notice of January 31, 1996, the period of the details DTI’s System Gas Requirements intervention or motion to intervene, as Docket No. RP91–161 settlement. and gas retained or otherwise obtained appropriate. Such notices, motions, or Columbia states further that it for the twelve-month period ending protests must be filed in accordance provided a copy of the report to all March 31, 2004. with the provisions of Section 154.210 customers who received a share of the Any person desiring to protest this of the Commission’s regulations (18 CFR environmental insurance recoveries and filing must file in accordance with Rule 154.210). Anyone filing an intervention all state commissions whose jurisdiction 211 of the Commission’s Rules of or protest must serve a copy of that includes the location of any such Practice and Procedure (18 CFR document on the Applicant. Anyone recipient. 385.211). Protests to this filing will be filing an intervention or protest on or Any person desiring to protest this considered by the Commission in before the intervention or protest date filing must file in accordance with Rule determining the appropriate action to be need not serve motions to intervene or 211 of the Commission’s Rules of taken, but will not serve to make protests on persons other than the Practice and Procedure (18 CFR protestants parties to the proceeding. Applicant. 385.211). Protests to this filing will be Such protests must be filed on or before The Commission encourages considered by the Commission in the date as indicated below. Anyone electronic submission of protests and determining the appropriate action to be filing a protest must serve a copy of that interventions in lieu of paper using the taken, but will not serve to make document on all the parties to the ‘‘eFiling’’ link at http://www.ferc.gov. protestants parties to the proceeding. proceeding. Persons unable to file electronically Such protests must be filed on or before The Commission encourages should submit an original and 14 copies the date as indicated below. Anyone electronic submission of protests in lieu of the protest or intervention to the filing a protest must serve a copy of that of paper using the ‘‘eFiling’’ link at
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http://www.ferc.gov. Persons unable to DEPARTMENT OF ENERGY 888 First Street, NE., Washington, DC file electronically should submit an 20426. original and 14 copies of the protest to Federal Energy Regulatory This filing is accessible online at the Federal Energy Regulatory Commission http://www.ferc.gov, using the Commission, 888 First Street, NE., [Docket No. RP02–361–037] ‘‘eLibrary’’ link and is available for Washington, DC 20426. review in the Commission’s Public Reference Room in Washington, DC. This filing is accessible online at Gulfstream Natural Gas System, L.L.C.; There is an ‘‘eSubscription’’ link on the http://www.ferc.gov, using the Notice of Negotiated Rate Web site that enables subscribers to ‘‘eLibrary’’ link and is available for August 6, 2004. receive e-mail notification when a review in the Commission’s Public Take notice that on July 27, 2004, document is added to a subscribed Reference Room in Washington, DC. Gulfstream Natural Gas System, L.L.C. docket(s). For assistance with any FERC There is an ‘‘eSubscription’’ link on the (Gulfstream) tendered for filing as part Online service, please e-mail Web site that enables subscribers to of its FERC Gas Tariff, Original Volume [email protected], or call receive e-mail notification when a No. 1, Original Sheet No. 8.01f, (866) 208–3676 (toll free). For TTY, call document is added to a subscribed reflecting an effective date of August 1, (202) 502–8659. docket(s). For assistance with any FERC 2004. Online service, please e-mail Gulfstream states that this filing is Magalie R. Salas, [email protected], or call being made in connection with a Secretary. (866) 208–3676 (toll free). For TTY, call negotiated rate transaction pursuant to [FR Doc. E4–1793 Filed 8–11–04; 8:45 am] (202) 502–8659. section 31 of the General Terms and BILLING CODE 6717–01–P Protest Date: 5 p.m. eastern time on Conditions of Gulfstream’s FERC Gas August 12, 2004. Tariff. Gulfstream states that Original Sheet No. 8.01f identifies and describes DEPARTMENT OF ENERGY Magalie R. Salas, the negotiated rate transaction, Secretary. including the exact legal name of the Federal Energy Regulatory Commission [FR Doc. E4–1805 Filed 8–11–04; 8:45 am] relevant shipper, the negotiated rate, the rate schedule, the contract terms, and [Project No. 2726] BILLING CODE 6717–01–P the contract quantity. Gulfstream also states that Original Sheet No. 8.01f Idaho Power Company; Notice of DEPARTMENT OF ENERGY includes footnotes where necessary to Authorization for Continued Project provide further details on the Operation Federal Energy Regulatory transaction listed thereon. August 5, 2004. Commission Gulfstream states that copies of its filing have been mailed to all affected On July 29, 2002, Idaho Power customers and interested state Company, licensee for the Upper and [Docket No. CP01–415–016 and RP04–398– commissions. Lower Malad Project No. 2726, filed an 000] Any person desiring to intervene or to application for a new or subsequent protest this filing must file in license pursuant to the Federal Power East Tennessee Natural Gas Company; accordance with Rules 211 and 214 of Act (FPA) and the Commission’s Notice of Initiation of Proceeding the Commission’s Rules of Practice and regulations thereunder. Project No. 2726 August 6, 2004. Procedure (18 CFR 385.211 and is located on the Malad River in 385.214). Protests will be considered by Gooding County, Idaho. On August 4, 2004, the Commission the Commission in determining the The license for Project No. 2726 was issued an order initiating a proceeding appropriate action to be taken, but will issued for a period ending July 31, 2004. in Docket No. RP04–398–000 under not serve to make protestants parties to Section 15(a)(1) of the FPA, 16 U.S.C. section 5 of the Natural Gas Act, 15 the proceeding. Any person wishing to 808(a)(1), requires the Commission, at U.S.C. 717d (2000). The Commission’s become a party must file a notice of the expiration of a license term, to issue order directed East Tennessee Natural intervention or motion to intervene, as from year to year an annual license to Gas Company (East Tennessee) to appropriate. Such notices, motions, or the then licensee under the terms and submit a filing within 30 days of the protests must be filed in accordance conditions of the prior license until a issuance date of the order to either (a) with the provisions of section 154.210 new license is issued, or the project is show that all services over the Rocky of the Commission’s regulations (18 CFR otherwise disposed of as provided in Top, Gateway and Murray Projects 154.210). Anyone filing an intervention Section 15 or any other applicable cause East Tennessee to incur no gas or protest must serve a copy of that section of the FPA. If the project’s prior losses; or (b) make an alternative document on the Applicant. Anyone license waived the applicability of proposal for assessing lost-and- filing an intervention or protest on or Section 15 of the FPA, then, based on unaccounted-for gas charges for these before the intervention or protest date Section 9(b) of the Administrative expansion projects. The Commission need not serve motions to intervene or Procedure Act, 5 U.S.C. 558(c), and as will issue a notice pertaining to East protests on persons other than the set forth at 18 CFR 16.21(a), if the Tennessee’s filing and persons having Applicant. licensee of such project has filed an an interest in the proceeding will be The Commission encourages application for a subsequent license, the allowed to intervene, in accordance electronic submission of protests and licensee may continue to operate the with the Commission’s regulations. interventions in lieu of paper using the project in accordance with the terms ‘‘eFiling’’ link at http://www.ferc.gov. and conditions of the license after the Magalie R. Salas, Persons unable to file electronically minor or minor part license expires, Secretary. should submit an original and 14 copies until the Commission acts on its [FR Doc. E4–1794 Filed 8–11–04; 8:45 am] of the protest or intervention to the application. If the licensee of such a BILLING CODE 6717–01–P Federal Energy Regulatory Commission, project has not filed an application for
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a subsequent license, then it may be between March 27, 2000 and September based rate authority, with an required, pursuant to 18 CFR 16.21(b), 1, 2002. accompanying tariff. The proposed tariff to continue project operations until the Any person desiring to intervene or to provides for wholesale sales of capacity, Commission issues someone else a protest this filing must file in energy, and ancillary services at market- license for the project or otherwise accordance with Rules 211 and 214 of based rates. LMBE also requested waiver orders disposition of the project. the Commission’s Rules of Practice and of various Commission regulations. In If the project is subject to Section 15 Procedure (18 CFR 385.211 and particular, LMBE requested that the of the FPA, notice is hereby given that 385.214). Protests will be considered by Commission grant blanket approval an annual license for Project No. 2726 the Commission in determining the under 18 CFR Part 34 of all future is issued to Idaho Power Company for appropriate action to be taken, but will issuances of securities and assumptions a period effective August 1, 2004 not serve to make protestants parties to of liability by LMBE. through July 31, 2005, or until the the proceeding. Any person wishing to issuance of a new license for the project become a party must file a notice of On September 18, 2002, pursuant to or other disposition under the FPA, intervention or motion to intervene, as delegated authority, the Director, whichever comes first. If issuance of a appropriate. Such notices, motions, or Division of Tariffs and Market new license (or other disposition) does protests must be filed in accordance Development—Central, granted the not take place on or before August 1, with the provisions of Section 154.210 request for blanket approval under Part 2005, notice is hereby given that, of the Commission’s regulations (18 CFR 34, subject to the following: pursuant to 18 CFR 16.18(c), an annual 154.210). Anyone filing an intervention Any person desiring to be heard or to license under Section 15(a)(1) of the or protest must serve a copy of that protest the blanket approval of FPA is renewed automatically without document on the Applicant. Anyone issuances of securities or assumptions of further order or notice by the filing an intervention or protest on or liability by LMBE should file a motion Commission, unless the Commission before the intervention or protest date to intervene or protest with the Federal orders otherwise. need not serve motions to intervene or Energy Regulatory Commission, 888 If the project is not subject to Section protests on persons other than the First Street, N.E., Washington, D.C. 15 of the FPA, notice is hereby given Applicant. that Idaho Power Company is The Commission encourages 20426, in accordance with Rules 211 authorized to continue operation of the electronic submission of protests and and 214 of the Commission’s Rules of Upper and Lower Malad Project No. interventions in lieu of paper using the Practice and Procedure (18 CFR 385.211 2726 until such time as the Commission ‘‘eFiling’’ link at http://www.ferc.gov. and 385.214). acts on its application for subsequent Persons unable to file electronically Notice is hereby given that the license. should submit an original and 14 copies deadline for filing motions to intervene Magalie R. Salas, of the protest or intervention to the or protests is August 16, 2004. Federal Energy Regulatory Commission, Secretary. Absent a request to be heard in 888 First Street, NE., Washington, DC opposition by the deadline above, LMBE [FR Doc. E4–1802 Filed 8–11–04; 8:45 am] 20426. BILLING CODE 6717–01–P This filing is accessible on-line at is authorized to issue securities and http://www.ferc.gov, using the assume obligations or liabilities as a ‘‘eLibrary’’ link and is available for guarantor, indorser, surety, or otherwise DEPARTMENT OF ENERGY review in the Commission’s Public in respect of any security of another person; provided that such issuance or Federal Energy Regulatory Reference Room in Washington, DC. assumption is for some lawful object Commission There is an ‘‘eSubscription’’ link on the Web site that enables subscribers to within the corporate purposes of LMBE, [Docket No. RP04–437–000] receive email notification when a compatible with the public interest, and document is added to a subscribed is reasonably necessary or appropriate Iroquois Gas Transmission System, docket(s). For assistance with any FERC for such purposes. L.P.; Notice of Proposed Changeto Online service, please email FERC Gas Tariff The Commission reserves the right to [email protected], or call require a further showing that neither August 5, 2004. (866) 208–3676 (toll free). For TTY, call public nor private interests will be Take notice that on August 2, 2004, (202) 502–8659. adversely affected by continued Iroquois Gas Transmission System, L.P. Magalie R. Salas, approval of LMBE’s issuances of (Iroquois) tendered for filing the Secretary. securities or assumptions of liability. following revised sheets to its FERC Gas Tariff, First Revised Volume No. 1, to be [FR Doc. E4–1808 Filed 8–11–04; 8:45 am] Copies of the full text of the Director’s effective on September 1, 2004: BILLING CODE 6717–01–P Order are available from the Commission’s Public Reference Room, Sixth Revised Sheet No. 94 888 First Street, NE., Washington, DC Fourth Revised Sheet No. 97 DEPARTMENT OF ENERGY Seventh Revised Sheet No. 106 20426. The Order may also be viewed First Revised Sheet No. 161A Federal Energy Regulatory on the Commission’s Web site at http:/ Sixth Revised Sheet No. 162 Commission /www.ferc.gov, using the eLibrary link. Iroquois states that the purpose of Enter the docket number excluding the [Docket No. ER02–2408–000] Iroquois’ instant filing is to submit last three digits in the docket number filed to access the document. additional revisions to tariff sheets that Lower Mount Bethel Energy, LLC; Comments, protests, and interventions were submitted to the Commission on Notice of Issuance of Order May 7, 2004 and approved on June 2, may be filed electronically via the 2004 removing language waiving the August 6, 2004. Internet in lieu of paper. See, 18 CFR rate ceiling for short-term (less than one Lower Mount Bethel Energy, LLC 385.2001(a)(1)(iii) and the instructions year) capacity release transactions (LMBE) filed an application for market- on the Commission’s Web site under the
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‘‘e-Filing’’ link. The Commission agency, Indian tribe, or person must file a total electric output of 7.2 MW; (2) a strongly encourages electronic filings. a request for a study with the 10-mile-long, 10-foot average depth, Commission not later than 60 days from 1,291-acre reservoir; (3) a two-mile-long Magalie R. Salas, the date of filing of the application, and 69,000 volt transmission line; and (4) Secretary. serve a copy of the request on the appurtenant facilities. [FR Doc. E4–1787 Filed 8–11–04; 8:45 am] applicant. The Oakdale development includes BILLING CODE 6717–01–P l. Deadline for Filing Additional the following constructed facilities: (1) a Study Requests and Requests for 1,688-foot-long dam consisting of a 126- Cooperating Agency Status: 60 days foot-long, 58-foot-maximum-height east DEPARTMENT OF ENERGY from the date of this notice. All documents (original and eight concrete buttress and slab dam Federal Energy Regulatory copies) should be filed with: Magalie R. connecting the left abutment to the Commission Salas, Secretary, Federal Energy powerhouse; a 114-foot-long, 70-foot- [Project No. 12514–000] Regulatory Commission, 888 First wide powerhouse integral with the dam Street, NE., Washington, DC 20426. The containing three vertical Francis Northern Indiana Public Service Commission’s Rules of Practice require turbines-generating units with a rated Company; Notice of Application all interveners filing documents with head of 42 to 48 feet, total hydraulic Tendered for Filing With the the Commission to serve a copy of that capacity of 3,200 cubic feet per second Commission, Soliciting Additional document on each person on the official (cfc) and a total electric output of 9.2 Study Requests, and Establishing service list for the project. Further, if an MW; an 18-foot-wide structure Procedures for Relicensing and a intervener files comments or documents containing a nonfunctional fish ladder Deadline for Submission of Final with the Commission relating to the and a gated trash sluice; an 84-foot-long Amendments merits of an issue that may affect the ogee-shaped concrete gated spillway responsibilities of a particular resource with two 30-foot-wide, 22-foot-high August 5, 2004. agency, they must also serve a copy of vertical lift gates; a 90-foot-long, six bay Take notice that the following the document on that resource agency. concrete gravity siphon-type auxiliary hydroelectric application has been filed Additional study requests may be spillway; and a 1,260-foot-long west with the Commission and is available filed electronically via the Internet in earth embankment with a maximum for public inspection. lieu of paper. The Commission strongly height of 58 feet and a 30-foot-wide a. Type of Application: Original major encourages electronic filing. See 18 CFR crest; (2) a 10-mile-long, 16-foot average license. 385.2001(a)(1)(iii) and the instructions depth, 1,547-acre reservoir; and (3) b. Project No.: 12514–000. on the Commission’s Web site (http:// appurtenant facilities. c. Date Filed: June 28, 2004. www.ferc.gov) under the ‘‘e-Filing’’ link. o. A copy of the application is d. Applicant: Northern Indiana Public After logging into the e-Filing system, available for review at the Commission Service Company. select ‘‘Comment on Filing’’ from the in the Public Reference Room or may be e. Name of Project: Norway and Filing Type Selection screen and viewed on the Commission’s Web site at Oakdale Hydroelectric Project. continue with the filing process.’’ f. Location: On the Tippecanoe River m. Status: This application is not http://www.ferc.gov using the in Carroll and White Counties, Indiana. ready for environmental analysis at this ‘‘eLibrary’’ link. Enter the docket The project does not affect Federal time. number, excluding the last three digits lands. n. Description of Project: The existing in the docket number field (P–12514), to g. Filed Pursuant to: Federal Power Norway Oakdale Hydroelectric Project access the document. For assistance, Act, 16 U.S.C. 791 (a)–825(r). consists of the Norway development contact FERC Online Support at h. Applicant Contact: Jerome B. and the Oakdale development and has [email protected], or toll- Weeden, Vice President Generation; a combined installed capacity of 16.4 free at 1–866–208–3676, or for TTY, Northern Indiana Public Service megawatts (MW). The project produces (202) 502–8659. A copy is also available Company; 801 East 86th Avenue; an average annual generation of 27,538 for inspection and reproduction at the Merrillville, IN 46410; (219) 647–5730. megawatt-hours (MWh). All power is address in item h above. i. FERC Contact: Sergiu Serban at dispatched directly into the local grid You may also register online at (202) 502–6211, or and is used within the East Central Area http:// www.ferc.gov/esubscribenow.htm [email protected]. Reliability Coordination Agreement. to be notified via e-mail of new filings j. Cooperating Agencies: We are The Norway development includes and issuances related to this or other asking Federal, State, local, and tribal the following constructed facilities: (1) a pending projects. For assistance, contact agencies with jurisdiction and/or 915-foot-long dam consisting of a 410- FERC Online Support. special expertise with respect to foot-long, 34-foot-maximum-height p. With this notice, we are initiating environmental issues to cooperate with earthfill embankment with a concrete us in the preparation of the corewall; a 225-foot-long, 29-foot-high consultation with the Indiana State environmental document. Agencies who concrete gravity overflow spillway with Historic Preservation Officer (SHPO), as would like to request cooperating status flashboards; a 120-foot-long, 30-foot- required by § 106, National Historic should follow the instructions for filing high concrete gated spillway with three Preservation Act, and the regulations of comments described in item l below. 30-foot-wide, 22-foot-high spillway the Advisory Council on Historic k. Pursuant to Section 4.32(b)(7) of 18 gates; a 18-foot-wide, 30-foot-high trash Preservation, 36 CFR 800.4. CFR of the Commission’s regulations, if sluice housing with one 8-foot-wide, 11- q. Procedural schedule and final any resource agency, Indian tribe, or foot-high gate; and a 142-foot-long, 64- amendments: The application will be person believes that an additional foot-wide powerhouse integral with the processed according to the following scientific study should be conducted in dam containing four vertical Francis Hydro Licensing Schedule. Revisions to order to form an adequate factual basis turbines-generating units with a rated the schedule will be made if the for a complete analysis of the head of 28 feet, total hydraulic capacity Commission determines it necessary to application on its merit, the resource of 3,675 cubic feet per second (cfc) and do so:
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Milestone Tentative date
Tendering Notice ...... August 2004. Notice of Acceptance / Notice of Ready for Environmental Analysis ...... September 2004. Filing of Recommendations, Preliminary Terms and Conditions, and Fishway Prescriptions ...... November 2004. Commission issued Non-Draft EA ...... April 2005. Comments on EA ...... June 2005. Modified Terms and Conditions ...... August 2005. Ready for Commission Decision on the Application ...... October 2005.
Final amendments to the application project has not filed an application for requested that the Commission grant must be filed with the Commission no a subsequent license, then it may be blanket approval under 18 CFR part 34 later than 30 days from the issuance required, pursuant to 18 CFR 16.21(b), of all future issuances of securities and date of the Notice of Ready for to continue project operations until the assumptions of liability by PPL Environmental Analysis. Commission issues someone else a Sundance. license for the project or otherwise On May 2, 2002, pursuant to Magalie R. Salas, orders disposition of the project. delegated authority, the Director, Secretary. If the project is subject to section 15 Division of Tariffs and Market [FR Doc. E4–1800 Filed 8–11–04; 8:45 am] of the FPA, notice is hereby given that Development—West, granted the BILLING CODE 6717–01–P an annual license for Project No. 2720 request for blanket approval under part is issued to the City of Norway, 34, subject to the following: Michigan for a period effective August Any person desiring to be heard or to DEPARTMENT OF ENERGY 1, 2004, through July 31, 2005, or until protest the blanket approval of issuances of securities or assumptions of Federal Energy Regulatory the issuance of a new license for the liability by PPL Sundance should file a Commission project or other disposition under the FPA, whichever comes first. If issuance motion to intervene or protest with the [Project No. 2720] of a new license (or other disposition) Federal Energy Regulatory Commission, does not take place on or before August 888 First Street, NE., Washington, DC City of Norway, MI; Notice of 1, 2005, notice is hereby given that, 20426, in accordance with Rules 211 Authorization for Continued Project pursuant to 18 CFR 16.18(c), an annual and 214 of the Commission’s Rules of Operation license under section 15(a)(1) of the Practice and Procedure (18 CFR 385.211 FPA is renewed automatically without and 385.214). August 5, 2004. further order or notice by the Notice is hereby given that the On July 29, 2002, the City of Norway, Commission, unless the Commission deadline for filing motions to intervene Michigan, licensee for the Sturgeon orders otherwise. or protest, is August 16, 2004. Falls Project No. 2720, filed an If the project is not subject to section Absent a request to be heard in application for a new or subsequent 15 of the FPA, notice is hereby given opposition by the deadline above, PPL license pursuant to the Federal Power that the City of Norway, Michigan is Sundance is authorized to issue Act (FPA) and the Commission’s authorized to continue operation of the securities and assume obligations or regulations thereunder. Project No. 2720 Sturgeon Falls Project No. 2720 until liabilities as a guarantor, indorser, is located on the Menominee River in such time as the Commission acts on its surety, or otherwise in respect of any Dickinson County, Michigan and application for subsequent license. security of another person; provided Marinette County, Wisconsin. that such issuance or assumption is for The license for Project No. 2720 was Magalie R. Salas, some lawful object within the corporate issued for a period ending July 31, 2004. Secretary. purposes of PPL Sundance, compatible Section 15(a)(1) of the FPA, 16 U.S.C. [FR Doc. E4–1801 Filed 8–11–04; 8:45 am] with the public interest, and is 808(a)(1), requires the Commission, at BILLING CODE 6717–01–P reasonably necessary or appropriate for the expiration of a license term, to issue such purposes. from year to year an annual license to The Commission reserves the right to the then licensee under the terms and DEPARTMENT OF ENERGY require a further showing that neither conditions of the prior license until a public nor private interests will be new license is issued, or the project is Federal Energy Regulatory adversely affected by continued otherwise disposed of as provided in Commission approval of PPL Sundance’s issuances section 15 or any other applicable [Docket No. ER02–1325–000] of securities or assumptions of liability. section of the FPA. If the project’s prior Copies of the full text of the Director’s license waived the applicability of PPL Sundance Energy, LLC; Notice of Order are available from the section 15 of the FPA, then, based on Issuance of Order Commission’s Public Reference Room, section 9(b) of the Administrative 888 First Street, NE., Washington, DC Procedure Act, 5 U.S.C. 558(c), and as August 6, 2004. 20426. The Order may also be viewed set forth at 18 CFR 16.21(a), if the PPL Sundance Energy, PPL (PPL on the Commission’s Web site at licensee of such project has filed an Sundance) filed an application for http://www.ferc.gov, using the eLibrary application for a subsequent license, the market-based rate authority, with an link. Enter the docket number excluding licensee may continue to operate the accompanying tariff. The proposed tariff the last three digits in the docket project in accordance with the terms provides for wholesale sales of capacity, number filed to access the document. and conditions of the license after the energy, and ancillary services at market- Comments, protests, and interventions minor or minor part license expires, based rates. PPL Sundance also may be filed electronically via the until the Commission acts on its requested waiver of various Commission internet in lieu of paper. See, 18 CFR application. If the licensee of such a regulations. In particular, PPL Sundance 385.2001(a)(1)(iii) and the instructions
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on the Commission’s Web site under the Protest Date: 5 p.m. eastern time on Protest Date: 5 p.m. eastern time on ‘‘e-Filing’’ link. The Commission August 12, 2004. August 20, 2004. strongly encourages electronic filings. Magalie R. Salas, Magalie R. Salas, Magalie R. Salas, Secretary. Secretary. Secretary. [FR Doc. E4–1806 Filed 8–11–04; 8:45 am] [FR Doc. E4–1810 Filed 8–11–04; 8:45 am] [FR Doc. E4–1786 Filed 8–11–04; 8:45 am] BILLING CODE 6717–01–P BILLING CODE 6717–01–P BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY Federal Energy Regulatory Federal Energy Regulatory Federal Energy Regulatory Commission Commission Commission [Docket No. CP04–14–002] [Docket No. RP00–426–019]
[Docket No. RP04–411–000] Saltville Gas Storage Company L.L.C.; Texas Gas Transmission, LLC; Notice Notice of Compliance Filing of Negotiated Rate Sabine Pipe Line LLC; Notice of Request for Waiver August 5, 2004. August 5, 2004. Take notice that on August 2, 2004, Take notice that on July 30, 2004, August 5, 2004. Saltville Gas Storage Company L.L.C. Texas Gas Transmission, LLC, (Texas Take notice that on June 1, 2004, (Saltville) tendered for filing a Gas) tendered for filing as part of its Sabine Pipe Line LLC (Sabine) filed a compliance filing pursuant to the FERC Gas Tariff, Second Revised request for a waiver of section ‘‘Order Issuing Certificates’’ issued by Volume No. 1, Second Revised Sheet 284.12(c)(3) of the Commission’s the Commission on June 14, 2004, in the No. 51, to become effective August 1, regulations to the extent it requires EDI/ referenced docket. 2004. EDM capability. Sabine states that its Saltville states that copies of the filing Texas Gas states that the purpose of customers have not used this were served on all parties on the official this filing is to submit to the application, and prefer instead the service list in the above captioned Commission a revised tariff sheet capability now offered through Sabine’s proceeding, as well as to all affected detailing a negotiated rate agreement high speed communications and customers of Saltville and interested between Texas Gas and Noble Energy interactive Web site. state commissions. Marketing, Inc. (Noble), dated July 23, Any person desiring to protest this Any person desiring to protest this 2004, to be effective August 1, 2004, filing must file in accordance with Rule filing must file in accordance with Rule under a Firm Transportation (FT) 211 of the Commission’s Rules of 211 of the Commission’s Rules of service agreement. Texas Gas further Practice and Procedure (18 CFR Practice and Procedure (18 CFR states that this negotiated rate agreement 385.211). Protests to this filing will be 385.211). Protests to this filing will be is being submitted in compliance with considered by the Commission in considered by the Commission in ‘‘Section 38. Negotiated Rates’’ of the determining the appropriate action to be determining the appropriate action to be General Terms and Conditions of Texas taken, but will not serve to make taken, but will not serve to make Gas’’ tariff and the Commission’s protestants parties to the proceeding. protestants parties to the proceeding. modified policy on negotiated rates [104 Such protests must be filed on or before Such protests must be filed on or before FERC ¶61,134 (2003)]. the date as indicated below. Anyone the date as indicated below. Anyone Any person desiring to intervene or to filing a protest must serve a copy of that filing a protest must serve a copy of that protest this filing must file in document on all the parties to the document on all the parties to the accordance with Rules 211 and 214 of proceeding. proceeding. the Commission’s Rules of Practice and The Commission encourages The Commission encourages Procedure (18 CFR 385.211 and electronic submission of protests in lieu electronic submission of protests in lieu 385.214). Protests will be considered by of paper using the ‘‘eFiling’’ link at of paper using the ‘‘eFiling’’ link at the Commission in determining the http://www.ferc.gov. Persons unable to http://www.ferc.gov. Persons unable to appropriate action to be taken, but will file electronically should submit an file electronically should submit an not serve to make protestants parties to original and 14 copies of the protest to original and 14 copies of the protest to the proceeding. Any person wishing to the Federal Energy Regulatory the Federal Energy Regulatory become a party must file a notice of Commission, 888 First Street, NE., Commission, 888 First Street, NE., intervention or motion to intervene, as Washington, DC 20426. Washington, DC 20426. appropriate. Such notices, motions, or This filing is accessible on-line at This filing is accessible on-line at protests must be filed in accordance http://www.ferc.gov, using the http://www.ferc.gov, using the with the provisions of Section 154.210 ‘‘eLibrary’’ link and is available for ‘‘eLibrary’’ link and is available for of the Commission’s regulations (18 CFR review in the Commission’s Public review in the Commission’s Public 154.210). Anyone filing an intervention Reference Room in Washington, DC. Reference Room in Washington, DC. or protest must serve a copy of that There is an ‘‘eSubscription’’ link on the There is an ‘‘eSubscription’’ link on the document on the Applicant. Anyone Web site that enables subscribers to Web site that enables subscribers to filing an intervention or protest on or receive email notification when a receive e-mail notification when a before the intervention or protest date document is added to a subscribed document is added to a subscribed need not serve motions to intervene or docket(s). For assistance with any FERC docket(s). For assistance with any FERC protests on persons other than the Online service, please e-mail Online service, please e-mail Applicant. [email protected], or call [email protected], or call The Commission encourages (866) 208–3676 (toll free). For TTY, call (866) 208–3676 (toll free). For TTY, call electronic submission of protests and (202) 502–8659. (202) 502–8659. interventions in lieu of paper using the
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‘‘eFiling’’ link at http://www.ferc.gov. the ‘‘e-Library’’ link. Enter the docket Comment Date: August 26, 2004. Persons unable to file electronically number excluding the last three digits in Magalie R. Salas, should submit an original and 14 copies the docket number field to access the of the protest or intervention to the document. For assistance, please contact Secretary. Federal Energy Regulatory Commission, FERC Online Support at [FR Doc. E4–1797 Filed 8–11–04; 8:45 am] 888 First Street, NE., Washington, DC [email protected] or toll- BILLING CODE 6717–01–P 20426. free at (866) 208–3676, or for TTY, This filing is accessible online at contact (202) 502–8659. DEPARTMENT OF ENERGY http://www.ferc.gov, using the Transco’s contact person for this ‘‘eLibrary’’ link and is available for proceeding is Scott C. Turkington, Federal Energy Regulatory review in the Commission’s Public Director, Rates & Regulatory, (713) 215– Commission Reference Room in Washington, DC. 3391, P.O. Box 1396, Houston, Texas There is an ‘‘eSubscription’’ link on the 77251. Crosstex’s contact person for this [Docket No. CP04–387–000] web site that enables subscribers to proceeding is Leslie J. Wylie, Vice receive e-mail notification when a President, Legal and Administration, Transcontinental Gas Pipe Line document is added to a subscribed (214) 721–9321, 2501 Cedar Springs Corporation; Notice of Application for docket(s). For assistance with any FERC Road, Suite 600, Dallas, Texas 75201. Abandonment Online service, please e-mail There are two ways to become August 5, 2004. [email protected], or call involved in the Commission’s review of Take notice that on July 29, 2004, (866) 208–3676 (toll free). For TTY, call this project. First, any person wishing to Transcontinental Gas Pipe Line (202) 502–8659. obtain legal status by becoming a party Corporation (Transco) filed with the Magalie R. Salas, to the proceedings for this project Commission an application under Secretary. should file with the Federal Energy section 7 of the Natural Gas Act to Regulatory Commission, 888 First [FR Doc. E4–1804 Filed 8–11–04; 8:45 am] abandon a portion of the firm Street, NE., Washington, DC 20426, a BILLING CODE 6717–01–P transportation service provided to motion to intervene in accordance with Commission of Public Works, Laurens, the requirements of the Commission’s South Carolina (Laurens) under DEPARTMENT OF ENERGY Rules of Practice and Procedure (18 CFR Transco’s Rate Schedule FT. 385.214 or 385.211) and the Regulations Transco states that under a service Federal Energy Regulatory under the NGA (18 CFR 157.10) by the agreement dated February 1, 1992, Commission comment date, below. A person Transco renders for Laurens firm obtaining party status will be placed on transportation service under Transco’s [Docket No. CP04–385–000] the service list maintained by the Rate Schedule FT. The service Transcontinental Gas Pipeline Secretary of the Commission and will agreement sets forth the terms and Corporation; Crosstex CCNG receive copies of all documents filed by conditions under which Transco Transmission, Ltd.; Notice of the applicant and by all other parties. A provides firm transportation of 8,114 Dt Application party must submit 14 copies of filings of gas per day for Laurens. Transco made with the Commission and must explains that, although the firm August 5, 2004. mail a copy to the applicant and to transportation service is being rendered Take notice that on July 28, 2004, every other party in the proceeding. by Transco pursuant to Transco’s Transcontinental Gas Pipeline Only parties to the proceeding can ask blanket certificate authorization under Corporation (Transco), P.O. Box 1396, for court review of Commission orders part 284(G) of the Commission’s Houston, Texas 77251, and Crosstex in the proceeding. regulations, Transco requires specific CCNG Transmission, Ltd. (Crosstex), However, a person does not have to section 7(b) abandonment authorization 2501 Cedar Springs, Suite 600, Dallas, intervene in order to have comments because the subject FT service for Texas 75201, filed, in Docket No. CP04– considered. The second way to Laurens was previously converted from 385–000, an application pursuant to participate is by filing with the firm sales service to firm transportation section 7(b) of the Natural Gas Act Secretary of the Commission, as soon as service under Transco’s Rate Schedule (NGA) and Part 157 of the Commission possible, an original and two copies of FT pursuant to Transco’s revised regulations, for authorization to comments in support of or in opposition Stipulation and Agreement in Docket abandon, by sale to Crosstex, certain of to this project. The Commission will Nos. RP88–68, et al. Transco adds that Transco’s natural gas pipeline facilities consider these comments in the settlement provides that pre-granted (South Texas Pipeline Facilities), determining the appropriate action to be abandonment shall not apply to such located in South Texas, and for taken, but the filing of a comment alone conversions (as further described in authorization to abandon Gulf South’s will not serve to make the filer a party Article IV of the Service Agreement). related transportation services. Transco to the proceeding. The Commission’s Transco proposes to abandon 2,000 Dt/ and Crosstex also request that the rules require that persons filing day of firm transportation service to Commission find that the South Texas comments in opposition to the project Laurens effective November 1, 2004. Pipeline Facilities, once abandoned and provide copies of their protests only to Any person desiring to intervene or to operated by Crosstex as an intrastate the party or parties directly involved in protest this filing must file in pipeline, will be exempt from the the protest. accordance with Rules 211 and 214 of Commission’s regulation, all as more Protests, comments and interventions the Commission’s Rules of Practice and fully set forth in the application which may be filed electronically via the Procedure (18 CFR 385.211 and is on file with the Commission and open Internet in lieu of paper; see, 18 CFR 385.214). Protests will be considered by to public inspection. This filing is 385.2001(a)(1)(iii) and the instructions the Commission in determining the available for review at the Commission on the Commission’s web site under the appropriate action to be taken, but will or may be viewed on the Commission’s ‘‘e-Filing’’ link. The Commission not serve to make protestants parties to Web site at http://www.ferc.gov using strongly encourages electronic filings. the proceeding. Any person wishing to
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become a party must file a notice of Third Revised Sheet No. 283C DEPARTMENT OF ENERGY intervention or motion to intervene, as Third Revised Sheet No. 740A appropriate. Such notices, motions, or Federal Energy Regulatory protests must be filed on or before the Williston Basin states that the Commission comment date. Anyone filing a motion proposed tariff changes are being to intervene or protest must serve a copy submitted to make certain minor [Docket No. ER01–1860–001, et al.] of that document on the Applicant. On conforming changes to bring its FERC Gas Tariff into compliance with Order Cobb Electric Membership Corp., et al.; or before the comment date, it is not Electric Rate and Corporate Filings necessary to serve motions to intervene Nos. 2004, et seq., and the or protests on persons other than the Commission’s Standards of Conduct August 4, 2004. Applicant. rules under 18 CFR Part 358 of the The following filings have been made The Commission encourages Commission’s Regulations. with the Commission. The filings are electronic submission of protests and Any person desiring to intervene or to listed in ascending order within each interventions in lieu of paper using the protest this filing must file in docket classification. ‘‘eFiling’’ link at http://www.ferc.gov. accordance with Rules 211 and 214 of 1. Cobb Electric Membership Corp. Persons unable to file electronically the Commission’s Rules of Practice and should submit an original and 14 copies Procedure (18 CFR 385.211 and [Docket No. ER01–1860–001] of the protest or intervention to the 385.214). Protests will be considered by Take notice that on July 12, 2004, Federal Energy Regulatory Commission, the Commission in determining the Cobb Electric Membership Corp. (Cobb) 888 First Street, NE., Washington, DC appropriate action to be taken, but will submitted for filing with the Federal 20426. not serve to make protestants parties to Energy Regulatory Commission its This filing is accessible on-line at triennial updated market analysis in http://www.ferc.gov, using the the proceeding. Any person wishing to become a party must file a notice of accordance with Appendix A of the ‘‘eLibrary’’ link and is available for Commission’s June 22, 2001, Letter intervention or motion to intervene, as review in the Commission’s Public Order, and the Commission’s May 13, appropriate. Such notices, motions, or Reference Room in Washington, DC. 2004, order generically granting Cobb There is an ‘‘eSubscription’’ link on the protests must be filed in accordance and similarly-situated entities an Web site that enables subscribers to with the provisions of Section 154.210 extension of time to file triennial receive e-mail notification when a of the Commission’s regulations (18 CFR market-based rate reviews. Cobb also document is added to a subscribed 154.210). Anyone filing an intervention submitted certain revisions to its docket(s). For assistance with any FERC or protest must serve a copy of that Original FERC Rate Schedule No. 1 to Online service, please e-mail document on the Applicant. Anyone incorporate the Market Behavior Rules [email protected], or call filing an intervention or protest on or set forth in 105 FERC ¶ 61,218 (2003). (866) 208–3676 (toll free). For TTY, call before the intervention or protest date Comment Date: 5 p.m. eastern time on (202) 502–8659. need not serve motions to intervene or August 16, 2004. Comment Date: 5 p.m. eastern time on protests on persons other than the 2. AllEnergy Marketing Company, LLC August 20, 2004. Applicant. Magalie R. Salas, The Commission encourages [Docket No. ER04–1037–000] Secretary. electronic submission of protests and Take notice that on July 23, 2004, [FR Doc. E4–1798 Filed 8–11–04; 8:45 am] interventions in lieu of paper using the AllEnergy Marketing Company, LLC filed a Notice of Cancellation of its BILLING CODE 6717–01–P ‘‘eFiling’’ link at http://www.ferc.gov. Persons unable to file electronically FERC Electric Tariff, Original Volume should submit an original and 14 copies No. 1, effective September 24, 2004. DEPARTMENT OF ENERGY of the protest or intervention to the Comment Date: 5 p.m. eastern time on August 20, 2004. Federal Energy Regulatory Commission, Federal Energy Regulatory 888 First Street, NE., Washington, DC Standard Paragraph Commission 20426. Any person desiring to intervene or to [Docket No. RP04–436–000] This filing is accessible on-line at protest this filing must file in http://www.ferc.gov, using the accordance with Rules 211 and 214 of Williston Basin Interstate Pipeline ‘‘eLibrary’’ link and is available for the Commission’s Rules of Practice and Company; Notice of Proposed review in the Commission’s Public Procedure (18 CFR 385.211 and Changes in FERC Gas Tariff Reference Room in Washington, DC. 385.214). Protests will be considered by August 5, 2004. There is an ‘‘eSubscription’’ link on the the Commission in determining the Take notice that on July 30, 2004, web site that enables subscribers to appropriate action to be taken, but will Williston Basin Interstate Pipeline receive email notification when a not serve to make protestants parties to Company (Williston Basin) tendered for document is added to a subscribed the proceeding. Any person wishing to filing as part of its FERC Gas Tariff, docket(s). For assistance with any FERC become a party must file a notice of Second Revised Volume No. 1, the Online service, please e-mail intervention or motion to intervene, as following revised tariff sheets to become [email protected], or call appropriate. Such notices, motions, or effective September 1, 2004: (866) 208–3676 (toll free). For TTY, call protests must be filed on or before the comment date. Anyone filing a motion (202) 502–8659. Eighteenth Revised Sheet No. 187 to intervene or protest must serve a copy Sixth Revised Sheet No. 225 Seventh Revised Sheet No. 226 Magalie R. Salas, of that document on the Applicant. On First Revised Sheet No. 227A.03 Secretary. or before the comment date, it is not Second Revised Sheet No. 227B [FR Doc. E4–1807 Filed 8–11–04; 8:45 am] necessary to serve motions to intervene Fifth Revised Sheet No. 232 or protests on persons other than the BILLING CODE 6717–01–P Third Revised Sheet No. 252A.03 Applicant.
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The Commission encourages measures, would not constitute a major A fact sheet prepared by the FERC electronic submission of protests and Federal action that would significantly entitled ‘‘An Interstate Natural Gas interventions in lieu of paper using the affect the quality of the human Facility On My Land? What Do I Need ‘‘eFiling’’ link at http://www.ferc.gov. environment. To Know?’’ is available for viewing on Persons unable to file electronically A copy of the EA is attached to a the FERC Internet Web site (http:// should submit an original and 14 copies Commission order titled ‘‘Order www.ferc.gov). This fact sheet addresses of the protest or intervention to the Granting Surrender Application and a number of typically asked questions, Federal Energy Regulatory Commission, Approving Project Removal Plan,’’ including how to participate in the 888 First Street, NE., Washington, DC which was issued August 4, 2004, and Commission’s proceedings. is available for review and reproduction 20426. Summary of the Proposed Project This filing is accessible on-line at at the Commission’s Public Reference http://www.ferc.gov, using the Room, located at 888 First Street, NE., CenterPoint seeks authorization from ‘‘eLibrary’’ link and is available for Room 2A, Washington, DC 20426. The the Commission to expand the capacity review in the Commission’s Public EA may also be viewed on the of its facilities in Arkansas to supply an Reference Room in Washington, DC. Commission’s Web site at http:// additional 70,000 dekatherms per day There is an ‘‘eSubscription’’ link on the www.ferc.gov using the ‘‘elibrary’’ link. (Dth/d) of natural gas to a local Web site that enables subscribers to Enter the docket number (prefaced by distribution company, Arkansas receive e-mail notification when a P-) and excluding the last three digits, Western Gas Company (AWG), over a 10 document is added to a subscribed in the docket number field to access the year period. CenterPoint’s application docket(s). For assistance with any FERC document. For assistance, contact FERC was filed with the Commission under Online service, please e-mail Online Support at section 7(c) of the Natural Gas Act and [email protected], or call [email protected] or toll- subpart A of part 157 of the (866) 208–3676 (toll free). For TTY, call free at (866) 208–3676, or for TTY, Commission’s regulations. (202) 502–8659. contact (202) 502–8659. To accomplish its project objectives, CenterPoint requests authority to install Magalie R. Salas, Magalie R. Salas, and operate: Secretary. Secretary. • One 4,700-hp turbine compressor [FR Doc. E4–1782 Filed 8–11–04; 8:45 am] [FR Doc. E4–1803 Filed 8–11–04; 8:45 am] and appurtenant facilities at its Round BILLING CODE 6717–01–P BILLING CODE 6717–01–P Mountain Compressor Station in Conway County; and • One 1,680-hp reciprocating DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY compressor and appurtenant facilities at its Helena Compressor Station in Federal Energy Regulatory Federal Energy Regulatory Phillips County. Commission Commission The general location of the project 1 [Project No. 696–013—Utah] [Docket No. CP04–377–000] facilities is shown in appendix 1. Land Requirements for Construction PacifiCorp; Notice of Availability of CenterPoint Energy Gas Transmission Environmental Assessment Company; Notice of Intent To Prepare The existing Round Mountain and an Environmental Assessment for the Helena Compressor Stations are located August 5, 2004. Proposed Round Mountain & Helena on 6.5-acre and 4-acre fenced lots, In accordance with the National Compression Expansion Project and respectively. All construction activities Environmental Policy Act of 1969 and Request for Comments on would take place within the fenced the Federal Energy Regulatory Environmental Issues boundaries. Both compressor stations Commission’s (Commission) are surrounded by idle pastureland and regulations, 18 CFR part 380 (Order No. August 6, 2004. mixed forest. Existing gravel access 486, 52 FR 47897), the Office of Energy The staff of the Federal Energy roads would not need improvement. Projects has reviewed the application Regulatory Commission (FERC or Construction activities would be for surrender of the license for the Commission) will prepare an performed in accordance with the American Fork Hydroelectric Project environmental assessment (EA) that will FERC’s Upland Erosion Control, and has prepared a Environmental discuss the environmental impacts of Revegetation, and Maintenance Plan Assessment (EA) for the project. The the Round Mountain & Helena and Wetland and Waterbody project is located on American Fork Compression Expansion Project Construction and Mitigation Procedures. Creek, near the City of American Fork, involving extension and operation of The EA Process about three miles east of Highland, in facilities by CenterPoint Energy Gas Utah County, Utah. The project Transmission Company (CenterPoint) in The National Environmental Policy occupies about 28.8 acres of land within Conway and Phillips Counties, Act (NEPA) requires the Commission to the Uinta National Forest, administered Arkansas. The project would consist of take into account the environmental by the U.S. Forest Service, and the addition of 6,380 horsepower (hp) of impacts that could result from an action approximately 2,000 feet of the project’s compression to two existing compressor whenever it considers the issuance of a flowline passes through the Timpanogos stations. CenterPoint states that the Cave National Monument, administered additional horsepower would enhance 1 The appendices referenced in this notice are not being printed in the Federal Register. Copies of all by the U.S. Department of the Interior, its system flexibility and reliability and appendices, other than appendix 1 (maps), are National Park Service. provide additional firm transportation available on the Commission’s website at the The EA contains the staff’s analysis of to a local distribution customer. This EA ‘‘eLibrary’’ link or from the Commission’s Public the potential environmental impacts of will be used by the Commission in its Reference Room, 888 First Street, NE., Washington, DC 20426, or call (202) 502–8371. For instructions the application and concludes that decision-making process to determine on connecting to eLibrary refer to the last page of surrendering the project, with the whether the project is in the public this notice. Copies of the appendices were sent to appropriate environmental protective convenience and necessity. all those receiving this notice in the mail.
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Certificate of Public Convenience and specific your comments, the more useful and government entities interested in Necessity. NEPA also requires us to they will be. Please carefully follow and/or potentially affected by the discover and address concerns the these instructions to ensure that your proposed project. This includes all public may have about proposals. This comments are received in time and landowners who own homes within process is referred to as ‘‘scoping.’’ The properly recorded: distances defined in the Commission’s main goal of the scoping process is to • Send an original and two copies of regulations of certain aboveground focus the analysis in the EA on the your letter to: Magalie R. Salas, facilities. important environmental issues. By this Secretary, Federal Energy Regulatory Additional Information Notice of Intent, the Commission staff Commission, 888 First St., NE., Room requests public comments on the scope 1A, Washington, DC 20426. Additional information about the of the issues to address in the EA. All • Label one copy of the comments for project is available from the comments received are considered the attention of Gas Branch 1. Commission’s Office of External Affairs, during the preparation of the EA. State • Reference Docket No. CP04–377– at 1–866–208–FERC or on the FERC and local government representatives 000. Internet Web site (http://www.ferc.gov) are encouraged to notify their • Mail your comments so that they using the eLibrary link. Click on the constituents of this proposed action and will be received in Washington, DC on eLibrary link, click on ‘‘General Search’’ encourage them to comment on their or before September 7, 2004. and enter the docket number excluding areas of concern. The Commission strongly encourages the last three digits in the Docket Our 2 independent analysis of the electronic filing of comments. See 18 Number field. Be sure you have selected issues will be presented in the EA. CFR 385.2001(a)(1)(iii) and the an appropriate date range. For Depending on the comments received instructions on the Commission’s Web assistance, please contact FERC Online during the scoping process, the EA may site at http://www.ferc.gov under the ‘‘e- Support at be published and mailed to federal, Filing’’ link and the link to the User’s [email protected] or toll state, and local agencies, public interest Guide. Before you can file comments free at 1–866–208–3676, or for TTY, groups, interested individuals, affected you will need to create a free account contact (202) 502–8659. landowners, newspapers, libraries, and which can be created on-line. In addition, the Commission now offers a free service called eSubscription the Commission’s official service list for Becoming an Intervenor this proceeding. A comment period will which allows you to keep track of all be allotted for review if the EA is In addition to involvement in the EA formal issuances and submittals in published. We will consider all scoping process, you may want to specific dockets. This can reduce the comments on the EA before we make become an official party to the amount of time you spend researching our recommendations to the proceeding known as an ‘‘intervenor.’’ proceedings by automatically providing Commission. Intervenors play a more formal role in you with notification of these filings, To ensure your comments are the process. Among other things, document summaries and direct links to considered, please carefully follow the intervenors have the right to receive the documents. To register for this instructions in the public participation copies of case-related Commission service, go to http://www.ferc.gov/ section below. documents and filings by other esubscribenow.htm. intervenors. Likewise, each intervenor Currently Identified Environmental must send one electronic copy (using Magalie R. Salas, Issues the Commission’s eFiling system) or 14 Secretary. We have already identified two issues paper copies of any filing to the [FR Doc. E4–1795 Filed 8–11–04; 8:45 am] that we think deserve attention based on Secretary of the Commission, and must BILLING CODE 6717–01–P a preliminary review of the proposed send a copy of its filings to all other facilities and the environmental parties on the Commission’s service list information provided by CenterPoint. for this proceeding. If you want to DEPARTMENT OF ENERGY This preliminary list of issues may be become an intervenor you must file a Federal Energy Regulatory changed based on your comments and motion to intervene according to Rule Commission our analysis. 214 of the Commission’s Rules of • Potential noise impacts on nearby Practice and Procedure (18 CFR [Docket Nos. CP04–379–000, CP04–380– residents. 385.214) (see appendix 2).3 Only 000, and CP04–381–000] • Effect of compressor emissions on intervenors have the right to seek air quality. rehearing of the Commission’s decision. Pine Prairie Energy Center, LLC; Affected landowners and parties with Notice of Intent To Prepare an Public Participation environmental concerns may be granted Environmental Assessment for the You can make a difference by intervenor status upon showing good Proposed Pine Prairie Energy Center, providing us with your specific cause by stating that they have a clear Request for Comments on comments or concerns about the project. and direct interest in this proceeding Environmental Issues, and Site Visit By becoming a commentor, your which would not be adequately August 6, 2004. concerns will be addressed in the EA represented by any other parties. You do and considered by the Commission. You The staff of the Federal Energy not need intervenor status to have your Regulatory Commission (FERC or should focus on the potential environmental comments considered. environmental effects of the proposal, Commission) will prepare an alternatives to the proposal, and Environmental Mailing List environmental assessment (EA) that will measures to avoid or lessen An effort is being made to send this discuss the environmental impacts of environmental impact. The more notice to all individuals, organizations, the Pine Prairie Energy Center involving construction and operation of facilities 2 ‘‘We,’’ ‘‘us,’’ and ‘‘our’’ refer to the 3 Interventions may also be filed electronically via by Pine Prairie Energy Center, LLC (Pine environmental staff of the Office of Energy Projects the Internet in lieu of paper. See the previous Prairie) in Evangeline, Acadia, and (OEP). discussion on filing comments electronically. Rapides Parishes, Louisiana. These
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facilities would consist of facilities, and attendant control restored and allowed to revert to its approximately 21.47 miles of new 24- buildings and equipment; former use. inch gas pipeline, 3 underground gas • A brine disposal and raw water The EA Process storage caverns, a compressor station withdrawal site located on 10 acres of with 48,000 horsepower of compression, land. The site will include 4 withdrawal The National Environmental Policy 6 pipeline meter facilities and 7 wells to obtain water to solution mine Act (NEPA) requires the Commission to pipeline interconnects. The EA will be the storage caverns and 4 injection wells take into account the environmental used by the Commission in its decision- to dispose of the brine; impacts that could result from an action making process to determine whether • The Mid Pipeline Corridor, whenever it considers the issuance of a the project is in the public convenience consisting of 6.36 miles of dual 24-inch Certificate of Public Convenience and and necessity. natural gas pipeline originating from the Necessity. NEPA also requires us to If you are a landowner receiving this Gas Handling Facility to the Chalk discover and address concerns the notice, you may be contacted by a Gathering System, an existing 24-inch public may have about proposals. This natural gas pipeline; process is referred to as ‘‘scoping’’. The pipeline company representative about • the acquisition of an easement to A service corridor containing 1.92 main goal of the scoping process is to construct, operate, and maintain the miles of dual 16-inch water pipelines focus the analysis in the EA on the proposed facilities. The pipeline will be collocated between the Gas important environmental issues. By this company would seek to negotiate a Handling Facility and the brine disposal Notice of Intent, the Commission staff and raw water disposal site; requests public comments on the scope mutually acceptable agreement. • However, if the project is approved by The North Pipeline Corridor, of the issues to address in the EA. All the Commission, that approval conveys consisting of 17.80 miles of the Chalk comments received are considered with it the right of eminent domain. system north of the Mid Pipeline during the preparation of the EA. State Therefore, if easement negotiations fail Corridor and will extent through and local government representatives to produce an agreement, the pipeline Evangeline Parish into Rapides Parish; are encouraged to notify their • The South Pipeline Corridor, company could initiate condemnation constituents of this proposed action and consisting of 16.49 miles of the Chalk proceedings in accordance with State encourage them to comment on their system south of the Mid Pipeline law. areas of concern. Corridor extending through Evangeline Our independent analysis of the A fact sheet prepared by the FERC Parish into Acadia Parish which would entitled ‘‘An Interstate Natural Gas issues will be in the EA. Depending on be looped with the installation of 11.24 the comments received during the Facility On My Land? What Do I Need miles of 24-inch natural gas pipeline; To Know?’’ was attached to the project • scoping process, the EA may be The TGT Lateral Pipeline Corridor, published and mailed to Federal, State notice Pine Prairie provided to extending from the South Pipeline landowners. This fact sheet addresses a and local agencies, public interest Corridor to the Texas Gas Interconnect, groups, interested individuals, affected number of typically asked questions, consisting of 0.7 mile of dual 24 inch including the use of eminent domain landowners, newspapers, libraries, and natural gas pipeline; the Commission’s official service list for and how to participate in the • The East Lateral Pipeline Corridor, this proceeding. A comment period will Commission’s proceedings. It is extending from the South Pipeline be allotted for review if the EA is available for viewing on the FERC Corridor to the interconnect with published. We will consider all Internet Web site (http://www.ferc.gov). Florida Gas Transmission, consisting of comments on the EA before we make 3.17 miles of 24-inch natural gas Summary of the Proposed Project our recommendations to the pipeline; and Commission. Pine Prairie proposes to construct and • A total of 6 meter stations would be In the EA we 2 will discuss impacts operate the Pine Prairie Energy Center constructed along with 7 pipeline that could occur as a result of the in Evangeline, Acadia, and Rapides interconnections and 5 contractor yards construction and operation of the Parishes, Louisiana. The proposal of approximately 10 acres each. includes construction and operation of The general location of the project proposed project under these general 3 solution-mined underground salt 1 headings: facilities is shown in appendix 1. If you • storage caverns, associated aboveground are interested in obtaining detailed Geology and soils. • Land use. facilities, and connecting pipelines for maps of a specific portion of the project, • Water resources, fisheries, and the storage of up to 24.0 billion cubic send in your request using the form in wetlands. feet (Bcf) of natural gas. The proposed appendix 3. • Cultural resources. and existing pipelines would connect • the storage facility to ANR Pipeline Land Requirements for Construction Vegetation and wildlife. • Air quality and noise. Company, Florida Gas Transmission Construction of the proposed facilities • Company, Tennessee Gas Pipeline would require about 383.1 acres of land. Endangered and threatened species. • Hazardous waste. Company, Texas Eastern Transmission, Following construction, about 59.5 acres • L.P., Texas Gas Transmission LLC would be maintained as new Public safety. (Texas Gas) and Transcontinental Gas aboveground facility sites. The We will also evaluate reasonable Pipe Line Corporation. Specifically, remaining 323.6 acres of land would be alternatives to the proposed project or Pine Prairie seeks authority to construct portions of the project, and make recommendations on how to lessen or and operate: 1 The appendices referenced in this notice are not avoid impacts on the various resource • A 60 acre gas storage site consisting being printed in the Federal Register. Copies of all appendices, other than appendix 1 (maps), are areas. of three underground salt dome storage available on the Commission’s Web site at the To ensure your comments are caverns of 8 Bcf storage capacity each; ‘‘eLibrary’’ link or from the Commission(s Public considered, please carefully follow the • A gas handling facility consisting of Reference Room, 888 First Street, NE., Washington, DC 20426, or call (202) 502–8371. For instructions a compressor building with six 8,000 on connecting to eLibrary refer to the last page of 2 ‘‘We’’, ‘‘us’’, and ‘‘our’’ refer to the horsepower gas engine driven this notice. Copies of the appendices were sent to environmental staff of the Office of Energy Projects reciprocating compressors, dehydration all those receiving this notice in the mail. (OEP).
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instructions in the public participation EIS and considered by the Commission. receive within a reasonable time frame section below. You should focus on the potential in our environmental analysis of this environmental effects of the proposal, project. However, the Commission Currently Identified Environmental alternatives to the proposal (including strongly encourages electronic filing of Issues alternative locations and routes), and any comments or interventions or We have already identified several measures to avoid or lessen protests to this proceeding. See 18 CFR issues that we think deserve attention environmental impact. The more 385.2001(a)(1)(iii) and the instructions based on a preliminary review of the specific your comments, the more useful on the Commission’s Web site at http:/ proposed facilities and the they will be. Please carefully follow /www.ferc.gov under the ‘‘e-Filing’’ link environmental information provided by these instructions to ensure that your and the link to the User’s Guide. Before Pine Prairie. This preliminary list of comments are received in time and you can file comments you will need to issues may be changed based on your properly recorded: create a free account which can be comments and our analysis. • Send an original and two copies of created on-line. • Brine disposal and raw water your letter to: Magalie R. Salas, We may mail the EA for comment. If withdrawal from aquifers. Secretary, Federal Energy Regulatory you are interested in receiving it, please • Wetland impacts along the pipeline Commission, 888 First St., NE., Room return the Information Request corridor. 1A, Washington, DC 20426. (appendix 4). If you do not return the • Air and noise quality impacts from • Label one copy of the comments for Information Request, you will be taken operation of the compressor facility. the attention of Gas Branch 3. off the mailing list. • Storage cavern and well casing • Reference Docket No. CP04–379– integrity management. 000, et al. The environmental staff of the Federal • Mail your comments so that they Energy Regulatory Commission will Public Participation will be received in Washington, DC on perform a site visit of the proposed You can make a difference by or before September 7, 2004. facility locations. Anyone interested in providing us with your specific Please note that we are continuing to participating in the field trip may comments or concerns about the project. experience delays in mail deliveries attend, but they must provide their own By becoming a commentor, your from the U.S. Postal Service. As a result, transportation. The meeting location concerns will be addressed in the EA/ we will include all comments that we prior to the site visit is as follows:
Time/date Meeting location Facility locations
9 a.m., Thursday, August 19, 2004 ...... The Pine Cone, 1017 Elm St., Pine Prairie, Gas handling facility, brine disposal and raw LA 70576. water withdrawal site, and Mid Pipeline Cor- ridor. 9 a.m., Friday, August 20, 2004 ...... The Pine Cone, 1017 Elm St., Pine Prairie, East Lateral, TGT Lateral, Meter and Regu- LA 70576. lator Sites.
Becoming an Intervenor intervenor status upon showing good Internet Web site (http://www.ferc.gov) In addition to involvement in the EA cause by stating that they have a clear using the eLibrary link. Click on the scoping process, you may want to and direct interest in this proceeding eLibrary link, click on ‘‘General Search’’ become an official party to the which would not be adequately and enter the docket number excluding proceeding known as an ‘‘intervenor’’. represented by any other parties. You do the last three digits in the Docket Intervenors play a more formal role in not need intervenor status to have your Number field. Be sure you have selected the process. Among other things, environmental comments considered. an appropriate date range. For intervenors have the right to receive Environmental Mailing List assistance, please contact FERC Online copies of case-related Commission Support at An effort is being made to send this documents and filings by other [email protected] or toll notice to all individuals, organizations, intervenors. Likewise, each intervenor and government entities interested in free at 1–866–208–3676, or for TTY, must send one electronic copy (using and/or potentially affected by the contact (202) 502–8659. the Commission’s eFiling system) or 14 proposed project. This includes all paper copies of any filing to the In addition, the Commission now landowners who are potential right-of- Secretary of the Commission, and must offers a free service called eSubscription send a copy of its filings to all other way grantors, whose property may be which allows you to keep track of all parties on the Commission’s service list used temporarily for project purposes, formal issuances and submittals in for this proceeding. If you want to or who own homes within distances specific dockets. This can reduce the become an intervenor you must file a defined in the Commission’s regulations amount of time you spend researching motion to intervene according to Rule of certain aboveground facilities. By this proceedings by automatically providing 214 of the Commission(s Rules of notice we are also asking governmental you with notification of these filings, Practice and Procedure (18 CFR agencies, especially those in appendix document summaries and direct links to 385.214) (see appendix 2).3 Only 3, to express their interest in becoming the documents. Go to http:// intervenors have the right to seek cooperating agencies for the preparation www.ferc.gov/esubscribenow.htm. rehearing of the Commission’s decision. of the EA. Finally, public meetings or site visits Affected landowners and parties with Additional Information will be posted on the Commission’s environmental concerns may be granted Additional information about the calendar located at http://www.ferc.gov/ project is available from the 3 Interventions may also be filed electronically via the Internet in lieu of paper. See the previous Commission’s Office of External Affairs, discussion on filing comments electronically. at 1–866–208–FERC or on the FERC
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EventCalendar/EventsList.aspx along d. Applicant: Great Lakes Hydro facilities, and provide public and tribal with other related information. America, LLC. access. e. Name of Project: Storage Project. l. A copy of the settlement agreement Magalie R. Salas, f. Location: On Ragged Stream, is available for review at the Secretary. Caucomgomoc Stream, and West Branch Commission in the Public Reference [FR Doc. E4–1785 Filed 8–11–04; 8:45 am] and South Branch of the Penobscot Room or may be viewed on the BILLING CODE 6717–01–P River in the Counties of Somerset and Commission’s Web site at http:// Piscataquis, Maine. The project would www.ferc.gov using the ‘‘eLibrary’’ link. not utilize federal lands. Enter the docket number excluding the DEPARTMENT OF ENERGY g. Filed Pursuant to: Rule 602 of the last three digits in the docket number Commission’s Rules of Practice and field to access the document. For Federal Energy Regulatory Procedure, 18 CFR 385.602. Commission assistance, contact FERC Online h. Applicant Contact: David Preble, Support at Annual Charges Billing Fiscal Year Operations Manager, Great Lakes Hydro [email protected] or toll- 2004; Notice of Correction America, LLC, 1024 Central Street, free at 1–866–208–3676, or TTY, (202) Millinocket, Maine 04462, (207) 723– 502–8659. A copy is also available for August 6, 2004. 4341 x106. inspection and reproduction at the On July 30, 2004, the Commission i. FERC Contact: John Costello, (202) address in item h above. issued the annual charges billings for 502–6119, [email protected]. You may also register online at http:/ Fiscal Year 2004. This statement of j. Deadline for Filing Comments: 20 /ferc.gov/docs-filing/esubscription.asp annual charges is issued pursuant to 18 days from the issuance date of this to be notified via email of new filings CFR part 382 and covers the period notice; reply comments are due 30 days and issuances related to this or other October 1, 2003, through September 30, from the issuance date of this notice. pending projects. For assistance, contact 2004. The Annual Charge Adjustment All documents (original and eight FERC Online Support. (ACA) unit charge included in the Gas copies) should be filed with: Magalie R. Program Cost Analysis in accordance Salas, Secretary, Federal Energy Magalie R. Salas, with 18 CFR 154.402(a) is corrected to Regulatory Commission, 888 First Secretary. read: Street, NE., Washington, DC 20426. [FR Doc. E4–1791 Filed 8–11–04; 8:45 am] ‘‘The annual charges unit charge to be The Commission’s Rules of Practice BILLING CODE 6717–01–P applied to rates in 2004 recovery of require all interveners filing documents 2003 debit/credit and 2004 current year with the Commission to serve a copy of annual charge is $0.0019 per Dth. In that document on each person on the DEPARTMENT OF ENERGY accordance with section § 154.402(a), official service list for the Project. Federal Energy Regulatory changes to the ACA must be filed Further, if an intervener files comments Commission annually to reflect the annual charge or documents with the Commission relating to the merits of an issue that unit rate authorized by the Commission Notice of FERC Staff Attendance at each fiscal year. If you need to change may affect the responsibilities of a particular resource agency, they must MISO Transmission Service/AFC your ACA surcharge, use $0.0019 per Workshop Dth in your company’s tariff, as it has also serve a copy of the document on been adjusted to include last year’s that resource agency. August 5, 2004. debit/credit factor.’’ Comments may be filed electronically The Federal Energy Regulatory If further information is required, via the Internet in lieu of paper. The Commission hereby gives notice that contact Fannie Kingsberry at 202–502– Commission strongly encourages members of its staff may attend the 6108. electronic filings. See 18 CFR meeting of the Midwest Independent 385.2001(a)(1)(iii) and the instructions Transmission System Operator, Inc. Magalie R. Salas, on the Commission’s Web site (http:// (MISO) Transmission Service/AFC Secretary. www.ferc.gov) under the ‘‘e-Filing’’ link. Workshop noted below. The staff’s k. Great Lakes (Great Lakes) Hydro [FR Doc. E4–1790 Filed 8–11–04; 8:45 am] attendance is part of the Commission’s America, LLC filed a settlement BILLING CODE 6717–01–P ongoing outreach efforts. agreement on the resolution of issues MISO Transmission Service/AFC related to the licensing proceeding for Workshop—August 12, 2004, 10 a.m.–3 DEPARTMENT OF ENERGY the Storage Project. Great Lakes filed p.m. (c.s.t.), Lakeside Conference Center this settlement agreement on behalf of (directly across from MISO’s Federal Energy Regulatory Penobscot Indian Nation, Commission headquarters), 630 West Carmel Drive, Passamaquoddy Tribe, U.S. Department Carmel, IN 46032. of the Interior, Bureau of Indian Affairs, The discussions may address matters Notice of Settlement Agreement and U.S. Department of the Interior, Fish Soliciting Comments at issue in the following proceedings: and Wildlife Service, U.S. Department Docket No. RM01–12–000, Remedying August 6, 2004. of the Interior, National Park Service, Undue Discrimination Through Open Take notice that following settlement Maine Department of Inland Fisheries Access Transmission Service and agreement has been filed with the and Wildlife, Maine Department of Standard Electricity Market Design. Commission and is available for public Conservation, Appalachian Mountain Docket No. EL02–65–000, et al., inspection. Club, American Whitewater, and New Alliance Companies, et al. a. Type of Application: Settlement England FLOW. The settlement Docket No. RT01–87–000, et al., Agreement on Resolution of Issues agreement includes provisions for Midwest Independent Transmission Related to Licensing of the Storage project operations and measures to System Operator, Inc. Project. enhance aquatic and riparian habitat, Docket No. ER03–323, et al., Midwest b. Project No.: P–2634–007. manage wildlife resources, protect Independent Transmission System c. Date filed: August 2, 2004. shorelines, improve recreational Operator, Inc.
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Docket No. ER03–1118, Midwest DEPARTMENT OF ENERGY communication, and may request that Independent Transmission System the Commission place the prohibited Operator, Inc. Federal Energy Regulatory communication and responses thereto Commission in the decisional record. The Docket No. ER04–691 and EL04–104, Commission will grant such a request Midwest Independent Transmission [Docket No. RM98–1–000] only when it determines that fairness so System Operator, Inc., et al. Records Governing Off-the-Record requires. Any person identified below as Docket No. ER04–375, Midwest Communications; Public Notice having made a prohibited off-the-record Independent Transmission System communication shall serve the Operator, Inc., et al. August 6, 2004. document on all parties listed on the This constitutes notice, in accordance Docket Nos. EL04–43 and EL04–46, official service list for the applicable with 18 CFR 385.2201(b), of the receipt Tenaska Power Services Co. and Cargill proceeding in accordance with Rule of exempt and prohibited off-the-record 2010, 18 CFR 385.2010. Power Markets, LLC v. Midwest communications. Exempt off-the-record Independent Transmission System Order No. 607 (64 FR 51222, communications will be included in the Operator, Inc. September 22, 1999) requires decisional record of the proceeding, Commission decisional employees, who The meeting is open to the public. unless the communication was with a make or receive an exempt or prohibited For more information, contact Patrick cooperating agency as described by 40 off-the-record communication relevant Clarey, Office of Markets, Tariffs and CFR 1501.6, made under 18 CFR to the merits of a contested on-the- 385.2201(e)(1)(v). Rates, Federal Energy Regulatory record proceeding, to deliver a copy of Commission at (317) 249–5937 or the communication, if written, or a The following is a list of prohibited [email protected], or Christopher summary of the substance of any oral and exempt communications recently Miller, Office of Markets, Tariffs and communication, to the Secretary. received in the Office of the Secretary. Rates, Federal Energy Regulatory Prohibited communications will be The communications listed are grouped Commission at (317) 249–5936 or included in a public, non-decisional file by docket numbers. These filings are [email protected]. associated with, but not a part of, the available for review at the Commission decisional record of the proceeding. in the Public Reference Room or may be Magalie R. Salas, Unless the Commission determines that viewed on the Commission’s Web site at Secretary. the prohibited communication and any http://www.ferc.gov using the eLibrary [FR Doc. E4–1799 Filed 8–11–04; 8:45 am] responses thereto should become a part (FERRIS) link. Enter the docket number BILLING CODE 6717–01–P of the decisional record, the prohibited excluding the last three digits in the off-the-record communication will not docket number field to access the be considered by the Commission in document. For Assistance, please reaching its decision. Parties to a contact FERC, Online Support at proceeding may seek the opportunity to [email protected] or toll respond to any facts or contentions free at (866) 208–3676, or for TTY, made in a prohibited off-the-record contact (202) 502–8659.
PROHIBITED
Docket number Date filed Presenter or requester
1. ER04–510–003, EL04–88–001, EL04–88–002 ...... 7–22–04 Robert Carey. 2. Project No. 1390–005 ...... 8–3–04 Katie Maloney Bellomo.
EXEMPT
Docket number Date filed Presenter or requester
1. CP04–223–000 ...... 7–22–04 Fran Lowell 1. 2. CP04–223–000 ...... 8–4–04 Capt. William C. Reed. 3. CP04–223–000 ...... 8–4–04 David Sanders. 4. Project No. 1971–000 ...... 7–28–04 Brian J. Brown. 1 Project Meeting Minutes.
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Magalie R. Salas, ENVIRONMENTAL PROTECTION EDOCKET to obtain a copy of the draft Secretary. AGENCY collection of information, submit or [FR Doc. E4–1792 Filed 8–11–04; 8:45 am] view public comments, access the index [OW–2004–0017, FRL–7800–6] BILLING CODE 6717–01–P listing of the contents of the public Agency Information Collection docket, and to access those documents Activities: Proposed Collection; in the public docket that are available DEPARTMENT OF ENERGY Comment Request; Combined Sewer electronically. Once in the system, Overflow Control Policy, EPA ICR select ‘‘search,’’ then key in the docket Federal Energy Regulatory Number 1680.03, OMB Control Number ID number identified above. Commission Any comments related to this ICR 2040–0170 should be submitted to EPA within 60 [Docket Nos. ER04–699–000, ER03–1272– AGENCY: Environmental Protection days of this notice. EPA’s policy is that 002, ER98–4410–000, ER98–4410–001, Agency. public comments, whether submitted ER98–4410–002, EL02–101–000, EL02–101– ACTION: Notice. electronically or in paper, will be made 001, and EL02–101–002] available for public viewing in SUMMARY: In compliance with the EDOCKET as EPA receives them and Entergy Services, Inc., CLECO Power, Paperwork Reduction Act (44 U.S.C. without change, unless the comment LLC Dalton Utilities Entergy Services, 3501 et seq.), this document announces contains copyrighted material, CBI, or Inc., Georgia Transmission that EPA is planning to submit a other information whose public Corporation, JEA, MEAG Power, Sam continuing Information Collection disclosure is restricted by statute. When Rayburn G&T Electric Cooperative, Request (ICR) to the Office of EPA identifies a comment containing Inc., Southern Company Services, Inc., Management and Budget (OMB). This is copyrighted material, EPA will provide City of Tallahassee, FL; Notice of a request to renew an existing approved a reference to that material in the Comment Period collection. This ICR is scheduled to version of the comment that is placed in expire on October 31, 2004. Before EDOCKET. The entire printed comment, August 6, 2004. submitting the ICR to OMB for review including the copyrighted material, will On July 29–30, 2004, the Federal and approval, EPA is soliciting be available in the public docket. Energy Regulatory Commission (FERC) comments on specific aspects of the Although identified as an item in the held a technical conference to discuss proposed information collection as official docket, information claimed as issues raised by Entergy Services Inc.’s described below. CBI, or whose disclosure is otherwise (Entergy) proposal in Docket No. ER04– DATES: Comments must be submitted on restricted by statute, is not included in 699–000 to, among other things, or before October 12, 2004. the official public docket, and will not establish an Independent Coordinator of ADDRESSES: Submit your comments, be available for public viewing in Transmission (ICT), as well as to EDOCKET. For further information address additional proceedings referencing docket ID number OW– 2004–0017 to EPA online using about the electronic docket, see EPA’s currently pending before the Federal Register notice describing the Commission that raise issues of EDOCKET (our preferred method), by email to [email protected], or by electronic docket at 67 FR 38102 (May transmission access on the Entergy 31, 2002), or go to http://www.epa.gov./ system. Members of the FERC, the mail to: EPA Docket Center, Environmental Protection Agency, edocket. Louisiana Public Service Commission, Affected entities: Entities potentially Water Docket (Mail Code 4101T), 1200 the Arkansas Public Service affected by this action are Pennsylvania Ave., NW., Washington, Commission, the Mississippi Public approximately 770 municipalities with DC 20460. Service Commission and the Council of combined sewer systems, which are the City of New Orleans, as well as the FOR FURTHER INFORMATION CONTACT: covered by EPA’s Combined Sewer staff of the Public Utilities Commission Timothy J. Dwyer, Environmental Overflow (CSO) Control Policy. of Texas, participated in the Protection Agency, Water Permits Title: Combined Sewer Overflow discussions. In addition, the Division (4203M), 1200 Pennsylvania Control Policy (OMB Control No. 2040– Commission heard from speakers Ave., NW., Washington, DC 20460; 0170; EPA ICR No. 1680.03) expiring on representing various market participants telephone number: 202–564–0717; fax October 31, 2004. on Entergy’s system. number: 202–564–6392; e-mail address: Abstract: EPA is proposing to Any party wishing to provide [email protected]. continue its ICR for the Combined additional or supplemental comments SUPPLEMENTARY INFORMATION: EPA has Sewer Overflow (CSO) Control Policy. as a result of issues discussed at the established a public docket for this ICR The ICR was approved in April 1994. conference should file such comments under Docket ID number OW–2004– The first renewal was approved in no later than August 31, 2004. 0017, which is available for public September 1997; the second in October Comments may be filed electronically viewing at the Water Docket in the EPA 2001. This renewal ICR includes the via the Internet in lieu of filing by Docket Center (EPA/DC), EPA West, burden associated with documenting paper. See 18 CFR 385.2001(a)(l)(iii) and Room B102, 1301 Constitution Ave., implementation of the nine minimum the instructions on the Commission’s NW., Washington, DC. The EPA Docket controls identified in the CSO control Web site at http://www.ferc.gov under Center Public Reading Room is open policy, public notification of CSO the ‘‘e-Filing’’ link. For additional from 8:30 a.m. to 4:30 p.m., Monday events and their impacts, developing information, please contact Anna through Friday, excluding legal and submitting long-term CSO control Cochrane at (202) 502–6357; holidays. The telephone number for the plans (LTCPs), and post-construction [email protected]. Reading Room is (202) 566–1744, and compliance monitoring. the telephone number for the Water Combined sewer systems (CSSs) serve Magalie R. Salas, Docket is (202) 566–2426. An electronic approximately 770 municipalities, Secretary. version of the public docket is available primarily in the Northeast and Great [FR Doc. E4–1788 Filed 8–11–04; 8:45 am] through EPA Dockets (EDOCKET) at Lakes regions. This number is smaller BILLING CODE 6717–01–P http://www.epa.gov/edocket. Use than that in the former ICR largely
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because the Agency has better data on targeted compliance monitoring hours and $46,774 and 15,807 hours the number of municipalities with program. and $532,722, respectively. The annual combined sewer systems nationwide. An agency may not conduct or average burden associated with CSOs occur when these systems sponsor, and a person is not required to reissuing NPDES permits or issuing overflow and discharge to receiving respond to, a collection of information other enforceable mechanisms to CSO waters prior to treatment in a publicly unless it displays a currently valid OMB municipalities is 307 hours and $10,828 owned treatment works (POTW). control number. The OMB control for the Federal government and 3,307 The CSO Control Policy, published on numbers for EPA’s regulations in 40 hours and $116,758 for State April 19, 1994 (59 FR 18688), is a CFR are listed in 40 CFR Part 9. governments. national framework for controlling CSOs The EPA would like to solicit The estimated burden on the States to through the National Pollutant comments to: report summary information to EPA for Discharge Elimination System (NPDES) (i) Evaluate whether the proposed oversight of the EPA’s CSO Control permitting program. The Policy collection of information is necessary Policy and for GPRA purposes is 1,200 represents a comprehensive national for the proper performance of the hours and $42,351. strategy to ensure that municipalities functions of the Agency, including Burden means the total time, effort, or with CSSs, NPDES permitting whether the information will have financial resources expended by persons authorities, water quality standards practical utility; to generate, maintain, retain, or disclose authorities, and the public engage in a (ii) Evaluate the accuracy of the or provide information to or for a comprehensive and coordinated Agency’s estimate of the burden of the Federal agency. This includes the time planning effort to achieve cost-effective proposed collection of information, needed to review instructions; develop, CSO controls that ultimately need including the validity of the acquire, install, and utilize technology appropriate health and environmental methodology and assumptions used; and systems for the purposes of objectives, including compliance with (iii) Enhance the quality, utility, and collecting, validating, and verifying water quality standards. In December clarity of the information to be information, processing and 2000, the Wet Weather Water Quality collected; and maintaining information, and disclosing (iv) Minimize the burden of the Standards Act amended the Clean Water and providing information; adjust the collection of information on those who Act by adding Section 402(q). Among existing ways to comply with any are to respond, including through the other things, Section 402(q)(1) requires previously applicable instructions and use of appropriate automated electronic, that permits, orders, and decrees issued requirements; train personnel to be able mechanical, or other technological after its date of enactment, shall to respond to a collection of collection techniques or other forms of conform to the EPA’s 1994 CSO Control information; search data sources; information technology, e.g., permitting Policy. complete and review the collection of Among the provisions in the CSO electronic submission of responses. Burden Statement: Based on the information; and transmit or otherwise Policy are the ‘‘nine minimum controls’’ disclose the information. (NMC), which are technology-based information collection requirements in actions or measures designed to reduce the existing ICR, the estimated burden Dated: August 5, 2004. the magnitude, frequency, and duration reflected in this ICR is 1,754,877 hours James A. Hanlon, of CSOs and their effects on receiving and a cost of $61,964,707. Director, Office of Wastewater Management. water quality. The CSO Control Policy Of this total, the portion for [FR Doc. 04–18460 Filed 8–11–04; 8:45 am] provided for implementation of the municipalities with combined sewer BILLING CODE 6560–50–P NMC by January 1, 1997. systems is 1,699,696 hours at a cost of One of the NMC is public notification $60,016,265 including start-up costs of of CSO occurrences and impacts. Public $182,125 for the third party notification ENVIRONMENTAL PROTECTION notification is of particular concern at under the Nine Minimum Controls AGENCY beach and recreation areas directly or (NMC) in the CSO Policy. The estimated indirectly affected by CSOs, where burden on each of 585 municipalities [FRL–7798–8] public exposure is likely to be for DMR reporting and recordkeeping is Notice of Proposed Administrative significant. That burden continues to be 417 hours and $14,724. The estimated Settlement Pursuant to the included in this renewal. burden on each of 490 municipalities Comprehensive Environmental The CSO Control Policy also contains for NMC reporting and long-term Response, Compensation, and Liability a provision for the development of long- control plan development and Act term control plans. The policy submission is 3,011 hours and $106,313 delineates that permit writers require and for third-party notification, 27 AGENCY: Environmental Protection permittees to develop a long-term plan hours and $940. Agency. within two years of the issuance of a The estimated burden for Federal and ACTION: Notice; request for public NPDES permit or other enforceable State governments is 4,894 hours and comment. mechanism containing such a $172,807 and 55,181 hours and requirement. The core of the plan is the $1,948,441, respectively. This includes SUMMARY: In accordance with section development and evaluation of long- the burden associated with reviewing 122(h) of the Comprehensive term control alternatives. One of the the DMRs, the NMC documentations, Environmental Response, elements of the long-term plan is the and the long-term control plans Compensation, and Liability Act, as development of a post-construction submitted by the respondents, and amended (‘‘CERCLA’’), 42 U.S.C. compliance monitoring program to be reissuing NPDES permits or issuing 9622(i), notice is hereby given of a implemented when selected controls are other enforceable mechanisms to proposed administrative settlement completed. OMB’s approval of the municipalities with CSSs to implement concerning the Imperial Refining initial ICR for the CSO Control Policy the CSO Control Policy. The annual Superfund Site, with Hogan Family, recommended that the renewal ICRs average burden for Federal and State L.L.C. include EPA’s best estimate of the review of DMRs, NMC documentations, The settlement requires the settling burden associated with a reasonable and and long-term control plans is 1,325 parties to pay a total of $300,575.29
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($292,000.00 to finance response actions (‘‘CWA’’), 33 U.S.C. 1319(g)(4)(A), installation of a well site. Storm water plus $8,575.29 in interest) as payment of notice is hereby given of a proposed from the Deer Lodge Park construction response costs to the Hazardous Consent Agreement and Final Order site drains to a tributary of the East Fork Substances Superfund. The settlement (‘‘CA/FO’’), which resolves penalties for Carson River. Pursuant to the proposed includes a covenant not to sue pursuant alleged violations of sections 301(a) of CA/FO, Respondent has consented to to section 107 of CERCLA, 42 U.S.C. the CWA, 33 U.S.C. 1311(a). The the assessment of a $3,000 penalty in 9607. respondent to the CA/FO is Deer Lodge this matter, and has certified that it will For thirty (30) days following the date Park L.L.C., a Nevada corporation obtain coverage under a NPDES permit of publication of this notice, the Agency (‘‘Respondent’’). Through the proposed for construction activities at Deer Lodge will receive written comments relating CA/FO, Respondent will pay $3,000 as Park. to this notice and will receive written a penalty for alleged violations II. General Procedural Information comments relating to the settlement. involving its failure to obtain coverage The Agency will consider all comments under either a CWA National Pollutant Any person who comments on the received and may modify or withdraw Discharge Elimination System (NPDES) proposed CA/FO shall be given notice of its consent to the settlement if individual permit, or the NPDES any hearing held and a reasonable comments received disclose facts or General Permit #NVR10000I for Storm opportunity to be heard and to present considerations which indicate that the Water Discharges From Construction evidence. If no hearing is held regarding settlement is inappropriate, improper, Activities for Indian Country within the comments received, any person or inadequate. The Agency’s response to State of Nevada (the ‘‘NPDES commenting on this proposed CA/FO any comments received will be available Construction General Permit’’), prior to may, within 30 days after the issuance for public inspection at 1445 Ross engaging in construction activity of the final order, petition the Agency to Avenue, Dallas, Texas 75202–2733. associated with development of the Deer set aside the CA/FO, as provided by DATES: Comments must be submitted on Lodge Park residential subdivision section 309(g)(4)(C) of the CWA, 33 or before September 13, 2004. located on individual Indian allotment U.S.C. 1319(g)(4)(C). Procedures by which the public may submit written ADDRESSES: land in Douglas County, Nevada. The proposed settlement comments or participate in the and additional background information DATES: For 30 days following the date of publication of this notice, the Agency proceedings are described in the relating to the settlement are available Consolidated Rules of Practice for public inspection at 1445 Ross will receive written comments relating to the proposed CA/FO. Governing the Administrative Avenue, Dallas, Texas 75202–2733. A Assessment of Civil Penalties, Issuance ADDRESSES: Requests for copies of the copy of the proposed settlement may be of Compliance or Corrective Action proposed CA/FO should be addressed obtained from Lydia Johnson, 1445 Ross Orders, and the Revocation, to: Richard Campbell, Attorney Advisor, Avenue, Dallas, Texas 75202–2733 or by Termination or Suspension of Permits, U.S. Environmental Protection Agency, calling (214) 665–8419. Comments 40 CFR Part 22. should reference the Imperial Refining Region IX, 75 Hawthorne Street, Superfund Site, Carter County, Mailcode: ORC–2, San Francisco, CA Dated: July 28, 2004. Oklahoma, and EPA Docket Number 06– 94105. Alexis Strauss, 06–2003, and should be addressed to Comments regarding the proposed Director, Water Division, Region IX. Lydia Johnson at the address listed CA/FO should be addressed to: Danielle [FR Doc. 04–18462 Filed 8–11–04; 8:45 am] above. Carr, Regional Hearing Clerk, U.S. BILLING CODE 6560–50–P Environmental Protection Agency, FOR FURTHER INFORMATION CONTACT: I- Region IX, 75 Hawthorne Street, San Jung Chiang, 1445 Ross Avenue, Dallas, Francisco, CA 94105. Texas 75202–2733 or call (214) 665– FEDERAL COMMUNICATIONS Comments should reference the COMMISSION 2160. following information: Dated: July 21, 2004. Case Name: In the Matter of Deer [Report No. AUC–04–58–C (Auction No. 58); Lynda F. Carroll, Lodge Park L.L.C. DA 04–2451] Docket Number: CWA–9–2004–0002. Acting Regional Administrator (6RA). Revised Inventory for Broadband PCS FOR FURTHER INFORMATION CONTACT: [FR Doc. 04–18461 Filed 8–11–04; 8:45 am] Spectrum Auction Comment Sought Richard Campbell at the above address BILLING CODE 6560–50–P on Reserve Prices or Minimum or by telephone at (415) 972–3870, or by Opening Bids and Other Auction e-mail at [email protected]. Procedures ENVIRONMENTAL PROTECTION SUPPLEMENTARY INFORMATION: AGENCY AGENCY: Federal Communications I. Background Commission. [FRL–7800–8] Respondent Deer Lodge Park L.L.C. is ACTION: Notice. Notice of Proposed Administrative an ‘‘operator’’, as that term is defined at 40 CFR Part 122, in control of site SUMMARY: This document revises the Consent Agreement and Final Order Auction No. 58 inventory to include Pursuant to Section 309(g)(4) of the specifications for the Deer Lodge Park residential subdivision. Construction eight additional licenses, and seeks Clean Water Act: In the Matter of Deer comment on procedural issues related to Lodge Park L.L.C. activities associated with development of the Deer Lodge Park residential the auction of these additional licenses. AGENCY: Environmental Protection subdivision were unpermitted under DATES: Comments are due on or before Agency. either an individual NPDES permit or a August 17, 2004, and reply comments ACTION: Notice; request for public NPDES Construction General Permit for are due on or before August 20, 2004. comment. six months in 2003. During this period, Auction No. 58 is scheduled to begin construction activity at the Deer Lodge January 12, 2005. SUMMARY: In accordance with section Park site involved grading of roads, ADDRESSES: Comments and reply 309(g)(4)(A) of the Clean Water Act, installation of a water tank, and comments must be sent by electronic
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mail to the following address: Revised License Inventory Public Notice. $0.05 * MHz * License Area Population [email protected]. The Auction No. 58 Revised License The specific proposed upfront FOR FURTHER INFORMATION CONTACT: For Inventory Public Notice seeks comment payment for each license available in legal questions: Scot Mackoul (202) on procedural issues related to the Auction No. 58 is set forth in 418–0660. For general auction auction of the eight additional D and E Attachment A of the Auction No. 58 questions: Jeff Crooks (202) 418–0660 or block licenses. Parties that submitted Revised License Inventory Public Notice. Lisa Stover (717) 338–2888. For service comments and/or reply comments in The Bureau further proposed that the rule questions, contact the Mobility response to the Auction No. 58 amount of the upfront payment Division, Wireless Telecommunications Comment Public Notice should not submitted by a bidder will determine Bureau, as follows: Erin McGrath, (202) resubmit those filings. Parties should the maximum number of bidding units 418–0620; JoAnn Epps, (202) 418–1342; submit comments regarding the auction on which a bidder may place bids. This or Dwain Livingston, (202) 418–1338. procedures only to the extent that they limit is a bidder’s initial eligibility. Each SUPPLEMENTARY INFORMATION: This is a relate to the new licenses included in license is assigned a specific number of summary of the Auction No. 58 Revised the auction inventory. bidding units equal to the upfront payment listed in Attachment A of the License Inventory Public Notice released II. Reserve Price or Minimum Opening Auction No. 58 Revised License on August 3, 2004. The complete text of Bid the Auction No. 58 Revised License Inventory Public Notice, on a bidding 2. For the eight additional D and E Inventory Public Notice, including unit per dollar basis. This number does block licenses offered in Auction No. not change as prices rise during the attachments is available for public 58, the Bureau proposes to use the same auction. A bidder’s upfront payment is inspection and copying during regular formula for calculating minimum not attributed to specific licenses. business hours at the FCC Reference opening bids as proposed in the Auction Rather, a bidder may place bids on any Information Center, Portals II, 445 12th No. 58 Comment Public Notice. combination of licenses as long as the Street, SW., Room CY–A257, Specifically, for Auction No. 58, the total number of bidding units associated Washington, DC 20554. The Auction No. Bureau has proposed to calculate with those licenses does not exceed its 58 Revised License Inventory Public minimum opening bids on a license-by- current eligibility. Eligibility cannot be Notice may also be purchased from the license basis using formulas based on increased during the auction. Thus, in Commission’s duplicating contractor, bandwidth and license area population. calculating its upfront payment amount, Best Copy and Printing, Inc. (‘‘BCPI’’), Furthermore, the Bureau has proposed an applicant must determine the Portals II, 445 12th Street, SW., Room to differentiate these formulas based on maximum number of bidding units it CY–B402, Washington, DC, 20554, the population of each license area. may wish to bid on (or hold high bids telephone (202) 488–5300, facsimile Population ≥ 2,000,000: $0.50 * MHz * on) in any single round, and submit an (202) 488–5563, or you may contact upfront payment covering that number BCPI at its Web site: http:// License Area Population Population ≥ 500,000: $0.25 * MHz * of bidding units. The Bureau seeks www.BCPIWEB.com. When ordering comment on these proposals as they documents from BCPI, please provide License Area Population Population <500,000: $0.15 * MHz * relate to the eight licenses added to the the appropriate FCC document number auction inventory. (for example, FCC 00–313 for the C/F License Area Population Block Sixth Report and Order). The The specific minimum opening bid IV. Other Auction Procedural Issues Auction No. 58 Revised License for each license available in Auction No. 4. In the Auction No. 58 Comment Inventory Public Notice is also 58 is set forth in Attachment A of the Public Notice, the Bureau also set forth available on the Internet at the Auction No. 58 Revised License and sought comment on the following Commission’s Web site: http:// Inventory Public Notice. The Bureau proposals relating to auction structure wireless.fcc.gov/auctions/58/. seek comment on these proposals in the and bidding procedures: (i) same manner as in the Auction No. 58 I. Background Simultaneous multiple-round auction Comment Public Notice, but in this case, design; (ii) activity rules; (iii) activity 1. In the Auction No. 58 Comment only as these proposals relate to the rule waivers and reducing eligibility; Public Notice, 69 FR 40632 (July 6, eight licenses added to the auction (iv) information relating to auction 2004), the Wireless inventory. Parties that submitted delay, suspension or cancellation; (v) Telecommunications Bureau (‘‘Bureau’’) comments and/or reply comments round structure; (vi) minimum announced the auction of 234 licenses regarding the reserve price or minimum acceptable bids and bid increments; (vii) in the broadband Personal opening bid in response to the Auction high bids and tied bids; (viii) Communication Service scheduled to No. 58 Comment Public Notice need not information regarding bid withdrawal commence on January 12, 2005 submit new comments unless it relates and bid removal; and (ix) auction (‘‘Auction No. 58’’). The Bureau also to the addition of the eight licenses. stopping rule. For the additional sought comment on procedures for the licenses in Auction No. 58, the Bureau auction of those licenses. By the III. Upfront Payments and Initial Maximum Eligibility for Each Bidder proposes to use the same auction Auction No. 58 Revised License structure and bidding procedures Inventory Public Notice, the Bureau 3. For the eight additional D and E proposed in the Auction No. 58 revises the auction inventory to also block licenses offered in Auction No. Comment Public Notice. The Bureau include eight D and E block broadband 58, the Bureau proposes to use the same seeks comment on these proposals as PCS licenses. Under the Commission’s formula for determining upfront they relate to the eight additional Part 24 rules, broadband PCS spectrum payments as previously proposed in the licenses included in Attachment A of in the D and E blocks is not subject to Auction No. 58 Comment Public Notice. the Auction No. 58 Revised License the entrepreneur eligibility restrictions. Specifically, for Auction No. 58, the Inventory Public Notice. These eight additional licenses, as well Bureau has proposed to calculate as the other licenses to be offered in upfront payments on a license-by- V. Conclusion Auction No. 58, are identified in license basis using a formula based on 5. Comments are due on or before Attachment A of the Auction No. 58 bandwidth and license area population: August 17, 2004, and reply comments
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are due on or before August 20, 2004. DATES: Comments are due September population? If particular portrayals of The Bureau requires that all comments 15, 2004; reply comments are due violence are more likely to cause and reply comments be filed October 15, 2004. deleterious effects than others, what electronically. Comments and reply ADDRESSES: Federal Communications specific kinds of programming should comments must be sent by electronic Commission, 445 12th Street, SW., be the focus of any further public mail to the following address: Washington, DC 20554. For further policymaking in this area? Should any [email protected]. The electronic mail filing information, see SUPPLEMENTARY further public policymaking address all containing the comments or reply INFORMATION. violence or just excessive or gratuitous comments must include a subject or violence, and how should that be FOR FURTHER INFORMATION CONTACT: caption referring to Auction No. 58 Ben defined? Are the ratings system and the Comments and the name of the Golant, (202) 418–7111 or V-chip accomplishing their intended commenting party. The Bureau requests [email protected]. purpose, or are there additional that parties format any attachments to SUPPLEMENTARY INFORMATION: This is a mechanisms that might be developed to electronic mail as Adobe Acrobat synopsis of the Notice of Inquiry, FCC control exposure to media violence? (pdf) or Microsoft Word documents. 04–175, adopted July 15, 2004 and Finally, are there legal constraints on Copies of comments and reply released July 28, 2004. The full text of either Congress or the Commission to comments will be available for public the Commission’s NOI is available for regulate violent programming? inspection during regular business inspection and copying during normal II. Discussion and Request for Comment hours in the FCC Reference Information business hours in the FCC Reference Center, Room CY–A257, 445 12th Street, Center (Room CY–A257) at its A. Incidence of Violent Programming SW., Washington, DC 20554. In headquarters, 445 12th Street, SW., 3. We seek specific information addition, the Bureau requests that Washington, DC 20554, or may be concerning how much televised commenters fax a courtesy copy of their purchased from the Commission’s copy violence there is on broadcast and non- comments and reply comments to the contractor, Qualex International, (202) broadcast television and whether the attention of Kathryn Garland at (717) 863–2893, Portals II, Room CY-B402, amount of violent programming is 338–2850. 445 12th St., SW., Washington, DC increasing or decreasing. The National 6. This proceeding has been 20554, or may be reviewed via Internet TV Violence Study, which appears to be designated as a ‘‘permit-but-disclose’’ at http://www.fcc.gov/mb. of the most extensive content analyses proceeding in accordance with the Synopsis of the Notice of Inquiry to date, involving the efforts of more Commission’s ex parte rules. Persons than 300 people recording and watching making oral ex parte presentations are I. Introduction more than 10,000 hours of television reminded that memoranda summarizing 1. We initiate this Notice of Inquiry programming from 1994 to 1997, the presentations must contain (‘‘NOI’’) to seek comment on issues indicates that more than half of all summaries of the substance of the relating to the presentation of violent television programming contains presentations and not merely a listing of programming on television and its violence. More specifically, during the the subjects discussed. More than a one impact on children. Violent television period of the study, the proportion of or two sentence description of the views programming content has been a matter programming with violence consistently and arguments presented is generally of private and governmental concern hovered around 60%. During prime required. Other rules pertaining to oral and discussion from at least the early time, the proportion rose from 53% to and written ex parte presentations in 1950s. Congress’ response, in 1996, was 67% on broadcast networks, and from permit-but-disclose proceedings are set adoption of section 551 of the 54% to 64% on basic (i.e., non- forth in § 1.1206(b) of the Commission’s Telecommunication Act 1996, which premium) cable channels. In addition, rules. resulted in the Commission’s cartoons include an average of Federal Communications Commission. implementation of the companion approximately one ‘‘high-risk’’ portrayal Gary Michaels, elements of the voluntary television of violence per cartoon, as categorized Deputy Chief, Auctions and Spectrum Access rating system and associated ‘‘V-chip’’ by the researchers. There have been Division, WTB. technology in 1998. More recently, the more recent reports on television [FR Doc. 04–18539 Filed 8–11–04; 8:45 am] Commission has received continuing violence. For example, the Parents expressions of Congressional concern BILLING CODE 6712–01–P Television Council (‘‘PTC’’) conducted a with respect to violent programming. content study finding that on all the On March 5, 2004, thirty-nine members television networks combined, violence FEDERAL COMMUNICATIONS of the U.S. House of Representatives, was 41% more frequent during the 8 COMMISSION Committee on Energy and Commerce, p.m. Family Hour in 2002 than in 1998 requested the Commission to begin a and during the second hour of prime ‘‘Notice of Inquiry on the issue of [MM Docket No. 04–261; FCC 04–175] time (9–10 p.m.), violence was 134.4% excessively violent broadcast television more frequent in 2002 that in 1998. Violent Television Programming and programming and its impact on 4. We seek additional information on Its Impact on Children children.’’ This proceeding is designed the frequency of televised violence. The to be responsive to these concerns and National TV Violence Study reports the AGENCY: Federal Communications to update the record on issues related to results of study during the three-year Commission. programmatic violence. period 1994–1997. What more recent ACTION: Notice of inquiry. 2. Through this proceeding we seek information, aside from the PTC Study comment and information along the noted above, is available about the SUMMARY: In this document, the following lines of inquiry. How much incidence of violence on television Commission seeks comment on issues violent programming is there, and what programming? What are the trends? Are relating to the presentation of violent are the trends? What are the effects of there differences between broadcast and programming on television and its viewing violent programming on non-broadcast media (i.e., cable and impact on children. children and other segments of the satellite)? Are there differences between
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premium and non-premium channels on appear to be less conclusive. Most different effect on children or adults cable or satellite? researchers and investigators agree that than do descriptions of violence in other exposure to media violence alone does not media, including print? How important B. Effects of Viewing Violent cause a child to commit a violent act, and is exposure to electronic media violence Programming that it is not the sole, or even necessarily the most important, factor contributing to youth relative to other sources of exposure; 5. At its core, concern about media aggression, anti-social attitudes, and i.e., does watching Wile E. Coyote fall violence derives from concern about violence. Although a consensus among off a cliff in a cartoon have more or less deleterious effects, particularly on researchers exists regarding the empirical an impact on a child’s psyche than children, that may result from exposure relationships, significant differences remain reading about Hansel and Gretel forcing to it. Over the course of several decades, over the interpretation of these associations a witch into a hot oven in Grimm’s fairy much research has been developed to and their implications for public policy. tales? Are there countervailing benefits examine and study these effects. Much A 2001 report from the United States that flow from televised violence? Does of the research within the public health Surgeon General’s 2001 Youth Violence: the inclusion of violent events in and scientific communities suggests that A Report of the Surgeon General fictional accounts help individuals exposure to media violence can be summarized the research thus: understand and process actual associated with certain negative effects. In sum, a diverse body of research provides incidences of violence they may Three types of studies have generally strong evidence that exposure to violence in encounter, experience, or learn of? Does been described in the literature; (1) field the media can increase children’s aggressive violence serve any artistic function that experiments in which subjects are behavior in the short term. Some studies should be considered, or are all shown video programming with their suggest that long-term effects exist, and there depictions of violence necessarily short-term post-viewing behavior are strong theoretical reasons why this is the gratuitous? monitored by researchers; (2) cross- case. But many questions remain regarding sectional studies involving a survey of the short- and long-term effects of media C. Defining Violent or Excessively or a sample of individuals at one point in violence, especially on violent behavior. Gratuitously Violent Programming for time and their conduct correlated with Despite considerable advances in research, it Public Policy Purposes is not yet possible to describe accurately how the amount and type of their television much exposure, of what types, for how long, 8. The above discussion assumes a viewing; and (3) longitudinal studies at what ages, for what types of children, or well established definition of violence that survey the same group of in what types of settings will predict violent in terms of measuring both the amount individuals at different times over many behavior in adolescents and adults. and effect of violent programming. This years to determine the effects of Research has continued since the is not necessarily the case. There are television viewing on subsequent completion of these two Reports, definitional difficulties because ‘‘not all behavior. Through these studies efforts including new longitudinal studies violence is created equal.’’ From a have been made to establish a cause and buttressing the conclusion that public policy standpoint, is there a need effect relationship between the viewing childhood exposure to media violence to define all violence, or simply of ‘‘violent’’ programming by ‘‘children’’ lasts into adulthood and increases gratuitous or excessive violence? and subsequent aggressive behavior on aggressive behavior. In addition, 9. For the purpose of determining, as the part of these individuals. Various researchers have developed new a general matter, whether a program definitions of violence and various age methods of measuring the impact of contains violence, researchers have used groups have been involved. Some of the exposure to media violence on children, broad definitions. For example, one studies also involve the effects of including MRI brain mapping research researcher defined violence as ‘‘the television viewing of all types rather conducted at the Indiana University overt expression of force intended to than just violent programming. Some School of Medicine and elsewhere. hurt or kill’’ in a content analysis involve the behavior of college-age or According to testimony given in 2003 conducted in the 1960s as part of the older viewers. The researchers have before the Senate Committee on National Commission on the Causes and tended to focus on three possible Commerce, Science & Transportation, a Prevention of Violence. The National harmful effects: (1) Increased antisocial comprehensive bibliography of research TV Violence Study defined violence as behavior, including imitations of and publications in this field includes ‘‘any overt depiction of a credible threat aggression or negative interaction; (2) 1,945 reports on children and television, of physical force or the actual use of desensitization to violence; and (3) approximately 600 of which deal with such force intended to physically harm increased fear of becoming a victim of the issue of TV violence. an animate being or group of beings. violence. 7. As indicated above, numerous Violence also includes certain 6. A year 2000 review of the scientific studies have demonstrated the harmful depictions of physically harmful research on the effects of entertainment effects of media violence on children. consequences against an animate being media violence on children, which We seek comment on any additional or group that occur as a result of unseen appears as part of the Federal Trade recent research in the field. We seek violent means.’’ The UCLA Violence Commission’s report on Marketing additional comment on the debate and Reports defined violence as ‘‘the act of, Violent Entertainment to Children, how the private sector, members of the attempt at, physical threat of or the summarized the research as follows: public, and academia are continuing to consequences of physical force.’’ As the A majority of the investigations into the address the net effects of media 1997 TV Violence Report explains, such impact of media violence on children find violence. Is there a correlation between broad definitions ‘‘include violence, that there is a high correlation between exposure to violence and aggressive cartoon violence, slapstick violence— exposure to media violence and aggressive behavior? If so, what are the anything that involves or immediately and at times violent behavior. In addition, a implications? Are there particular harms threatens physical harms of any sort, number of research efforts report that exposure to media violence is correlated with children suffer as a result of exposure to intentional or unintentional, self- increased acceptance of violent behavior in violent programming? What other inflicted or inflicted by someone or others, as well as an exaggerated perception factors contribute to observed aggressive something else.’’ We seek comment on of the amount of violence in society. behavior? Do depictions of violence in whether these definitions are Regarding causation, however, the studies video programming have an identifiably appropriate.
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10. At the same time, however, consider this the worst type of violence note that when violence is used researchers have often attempted to because it is unrealistic, there are no realistically, it is more desirable to identify the context, or qualitative consequences and it might encourage accurately portray the consequences nature, of a portrayal of violence. The children to imitate it precisely because it than to sanitize the violence in a shows no consequences. Others feel they 1997 TV Violence Report explains: watched these cartoons growing up and did manner designed to make it acceptable.’’ While parents, critics and others complain not imitate them because they knew these On the other hand, some might argue about the problem of violence on television, cartoons obviously were not ‘‘real.’’ Scholars that a television program such as ‘‘The it is not the mere presence of violence that have had to decide whether to count this Three Stooges’’ does not pose a great is the problem. If violence alone was the type of violence and usually have included risk to children even if the violence is problem and V-chips or other methods did it. Anyone who feels this inclusion is silly presented humorously and without away with violent scenes or programs, would reject the entire definition and might obvious consequences. Similarly, some viewers might never see a historical drama ignore the conclusions of the research. The might argue that more graphic violence like Roots or such outstanding theatrical same is true with slapstick humor. Sports is potentially more harmful to children films as Beauty and the Beast, The Lion King, programming provides yet another example. Forrest Gump and Schindler’s List. In many Many feel that violent spectator sports such than violence in which, for example, a instances, the use of violence may be critical as football or hockey make violence an body falls from a gunshot wound but the to a story that actually sends an anti-violence acceptable or even desirable part of American wounds are not shown. We seek message. Some important stories, such as life. Whether to count unrealistic cartoon additional comment on the types of Shakespeare’s Hamlet, the history of World violence, slapstick humor or sports within a portrayals that are of greatest concern, War II or the life of Abraham Lincoln, would definition of violence is itself a difficult particularly with respect to children. be impossible to convey accurately without decision. 13. How much televised violence is including portrayals of violence. portrayed in a way that is most likely to For centuries, violence has been an We seek comment on these issues. important element of storytelling, and violent 12. Against the backdrop of these harm children? For example, the themes have been found in the Bible, The definitional difficulties, what kinds of National TV Violence Study states that Iliad and The Odyssey, fairy tales, theater, portrayals of violence are of greatest 40% of the violent incidents studied literature, film and, of course, television. concern, particularly with respect to were initiated by characters with Descriptions of violence in the Bible have children? The National TV Violence qualities that make them good role been important for teaching lessons and Study states that ‘‘[i]f the consequences models; 70% of violent scenes do not establishing a moral code. Lessons of the of violence are demonstrated, if violence show penalty or remorse for violence at evils of jealousy and revenge are learned is shown to be regretted or punished, if the time it occurs; roughly half of from the story of Cain and Abel. Early fairy violent incidents do not show physical tales were filled with violence and its perpetrators are not glamorized, if gruesomeness designed to frighten children the act of violence is not seen as harm or pain; at least 40% of violent into behaving and to teach them right from justifiable, if in general violence is scenes include humor. The UCLA wrong. It was only when fairy tales were shown in a negative light, then the reports also identify particular shows portrayed on the big screen by Walt Disney portrayal of violence may not create that raised ‘‘concerns’’ about violence, and others that the violence contained in the undesirable consequences. But if according to a variety of contextual stories was substantially sanitized. violence is glamorized, sanitized or factors. We seek additional information In other words the study suggests, made to seem routine, then the message on what type of programming is ‘‘[t]he issue is not the mere presence of is that it is an acceptable, and perhaps potentially the most damaging, and how violence but the nature of violence and even desirable, course of action.’’ More frequently it occurs. the context in which it occurs. Context specifically, the National TV Violence 14. As we consider definitional is key to the determination of whether Study indicates that the portrayals that issues, we also ask commenters to or not violence is appropriate.’’ The pose the greatest risk for learning identify with precision the age groups National TV Violence Study similarly aggression contain attractive that qualify as ‘‘children’’ when they emphasizes that ‘‘the way in which perpetrators, morally justified reasons discuss whether violent programming is violence is presented helps to determine for engaging in violence, repeated harmful to them. Some scholarship whether a portrayal might be harmful to incidents of violence that appear suggests that children under the age of viewers.’’ realistic, violence that is rewarded or seven or eight are especially 11. But distinguishing one form of unpunished, and violence that does not impressionable because they have violence from another based on context show harm or pain to a victim or is difficulty distinguishing between is a difficult exercise. Again, in presented in a humorous context. fantasy and reality. We seek additional explaining how the researchers involved According to the study, portrayals that information on research that evidences in the UCLA violence studies pose the greatest risk for desensitization and explains the particular age groups determined which programs raised contain repeated incidents of violence that are of concern. ‘‘concerns’’ about violence, the 1997 TV or violence presented in a humorous 15. Finally, in the context of possible Violence Report illustrates the problem: context. Portrayals that pose the greatest regulation in this area, we note that No matter how well the definitions were risk for audience fear contain attractive members of the House Commerce drawn, there would be those who felt that victims, violence that appears Committee have asked the Commission some aspect of violence should or should not unjustified, repeated and realistic, and to examine whether it would be in the have been included. Almost everyone has his unpunished. In addition, the 1997 TV public interest for the agency to define or her own definition of violence. People Violence Report provides as examples of ‘‘excessively violent programming that have often attempted to validate or invalidate ‘‘inappropriate or improper uses of is harmful to children,’’ and if so, how quantitative research based on how much the violence’’ those ‘‘which glorify the act we might do so. We also seek comment scholar’s definition resembles their own. or teach that violence is always the way on how such a standard could be Animation for children is a good example of this phenomenon. Consider a cartoon in to resolve conflict.’’ That report further implemented in a manner that is both which a character is hit over the head with states that ‘‘the consequences of clear to the industry and practical to a two-by-four, a funny sound effect is heard, violence should be shown and those administer. We seek comment on these the character shakes his head and merrily persons using violence inappropriately issues to be responsive to the continues on his way. Some people might should be punished. We would also Committee’s concerns.
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D. TV Parental Guidelines and V-Chip used the V-Chip even after a concerted children are reasonably likely to 16. A regulatory system already exists effort to inform them about it. We seek comprise a substantial portion of the to help parents and viewers control the comment on recent initiatives to audience.’’ The Senate bill would also exposure of children to media violence. educate parents about the V-Chip’s require the Commission, upon finding The television industry rates availability. What can be done to in ongoing review that the television programming using the TV Parental enhance the usefulness of the V-chip? ratings system and the V-chip were not Guidelines, and encodes programming Are there ways to improve the ratings accomplishing their intended purposes, accordingly; in addition, the system? to ‘‘prohibit the distribution of violent video programming during the hours Commission has required that, by E. Possible New Regulatory Solution: when children are reasonably likely to January 1, 2000, all television sets ‘‘Safe Harbor’’ comprise a substantial portion of the manufactured in the United States or 20. If the TV Parental Guidelines and audience.’’ In other words, the bill shipped in interstate commerce with a V-chip are not adequate to protect would restrict violent programming to a picture screen of thirteen inches or children from any identifiable dangers ‘‘safe harbor’’ only if the programming larger be equipped with a ‘‘V-chip’’ that of exposure to media violence, what has not been rated violent, or if the can be programmed to block violent, other mechanisms are available? In their Commission finds that the ratings sexual, or other programming that recent letter, members of the House system and V-chip are not parents believe harmful to their Commerce Committee specifically asked accomplishing their intended purpose. children. how the Commission ‘‘might restrict The bill does not distinguish between 17. We seek comment on the status of broadcast of ‘excessively violent broadcast and non-broadcast media, and the existing rating and V-chip system as programming that is harmful to specifically notes that ‘‘[b]roadcast tools to help parents and viewers screen children’ during the hours when television, cable television, and video out violence. To what extent is children are likely to be a substantial programming are (A) uniquely pervasive programming in fact rated, using both part of the viewing audience, so that it presences in the lives of all American the age-based ratings, and the additional might supplement the TV ratings children; and (B) readily accessible to content labels for violence? Are the system, such as by creating time of day all American children.’’ We seek ratings consistent and accurate? A 1998 restrictions and measures that facilitate comment on whether the V–Chip is Kaiser Family Foundation study a consumer’s use of the television accomplishing its intended purpose, indicates that, during the first year the ratings system.’’ The legislation pending and if not, whether the safe harbor ratings system was in use, only 20% of in Congress also involves a ‘‘safe approach represents the least restrictive programs that contained violence, harbor’’ provision and the Senate has means to protect children. sexual material, or adult language adopted language to that effect. actually used the appropriate content 21. A starting point for considering a F. Statutory and Constitutional Issues label. This same study found that 79% ‘‘safe harbor’’ solution is our indecency 23. We seek to explore here the of violent programming is not rules. Indecent speech is entitled to bounds of permissible action, both specifically rated for violence.’’ constitutional protection, and so cannot regulatory and statutory, in light of the Moreover, a 2001 Kaiser Family be prohibited entirely. However, to relevant statutory and constitutional Foundation study indicates that 40% of protect children, the Commission’s rules constraints. In their recent letter, parents who use the rating system do prohibit the broadcast of indecent members of the House Commerce not believe programs are rated speech from 6 a.m. to 10 p.m., when Committee have asked whether the accurately. According to that study, children are likely to be a substantial Commission currently has the authority more than half of all parents use the part of the viewing audience. The to adopt a ‘‘safe harbor’’ for the ratings system to decide what Commission may fine television and broadcast of violent programming, ‘‘or programming that their children may radio stations for broadcasting indecent whether Congress would need to watch. In light of these findings, we content during this time period. At provide the Commission with statutory seek comment on whether the lack of a other times of the day, during the ‘‘safe authority to do so, and whether content rating for violence renders harbor’’ of the late night and early Congress could provide the FCC with ineffective any technology-based morning hours, the Commission permits that authority in a constitutional blocking mechanism, built into the broadcast of such speech. Obscene fashion.’’ Members of the House television sets, designed to limit violent speech on cable and other subscription Commerce Committee have also asked programming. television services, as well as on about constitutional limitations on our 18. We seek comment on these broadcast services, is a criminal offense ability to define the phrase ‘‘excessively findings of the Kaiser Family at all hours. Indecency regulation is violent programming that is harmful to Foundation. Is more recent information only applied to broadcast services. children,’’ or to create a ‘‘safe harbor’’ available on these issues? To what Would it be in the public interest to for such programming. If such a extent is use being made of the rating have ‘‘safe harbor’’ restrictions on mechanism were adopted, should there system? Do the TV Parental Guidelines violent programming content? Should it be an exception for news or other types now in use give parents sufficient apply to the broadcast medium only? of unrated programs? Should there be an information to make educated 22. Alternatively, the Congress or the exception for cultural, historical, or programming decisions for their Commission could tie the application of artistic merit? children? any ‘‘safe harbor’’ to the television 24. The Communications Act gives 19. We also seek comment on the ratings system, as the bill pending the Commission broad authority to usefulness of the V-chip. Although as before the Senate Commerce Committee regulate the broadcast medium as the many as 40% of parents have television does. That bill would declare it public interest requires. In order to grant sets equipped with a V-chip, more than ‘‘unlawful for any person to distribute to a radio license, Title III of the Act half of them are not aware of it, and two the public any violent video requires the Commission to determine thirds of those who are do not use it. programming not blockable by ‘‘whether the public interest, The Kaiser Foundation, in a recent electronic means specifically on the convenience, and necessity will be study, has found that parents have not basis of its violent content when served by the granting of such
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application,’’ and to issue a license only could possibly provide a basis for channeling’’ requirement to protect upon making an affirmative finding. regulation of violent ‘‘pictures.’’ We children from sexually explicit Title III likewise directs the recognize that an interpretation of programming. We seek comment on Commission, ‘‘as the public interest, indecency or obscenity as encompassing whether the Commission has authority convenience, and necessity requires,’’ to violence would be novel, but we seek to to regulate violent programming on ‘‘[m]ake such rules and regulations and determine the scope of existing cable television other than as prescribe such restrictions and standards to regulate violent specifically provided in Title VI. Does conditions, not inconsistent with law, as programming, as members of the House the Commission have broader statutory may be necessary to carry out the Commerce Committee request. authority to regulate violent provisions of this Act. * * *’’ However, 26. How does Title V of the 1996 Act, programming on DBS and other non- Section 326 in Title III also states: entitled ‘‘Obscenity and Violence,’’ broadcast subscription services, which ‘‘Nothing in this Act shall be affect the Commission’s general are not covered by Section 544(f), than understood or construed to give the authority in this area? Section 551 on cable services? Commission the power of censorship directed the Commission to prescribe 28. Assuming the Commission has or over the radio communications or ‘‘guidelines and recommended is granted statutory authority to regulate signals transmitted by any radio station, procedures for the identification and violent programming, what and no regulation or condition shall be rating of video programming that constitutional limitations apply? For promulgated or fixed by the contains sexual, violent, or other example, given the definitional issues Commission which shall interfere with indecent material about which parents discussed above, how could Congress or the right of free speech by means of should be informed before it is the Commission define some form of radio communication.’’ Is the displayed to children,’’ if the television violent programming in a way that is Commission’s general public interest industry itself did not establish not unconstitutionally vague or authority sufficiently broad to regulate ‘‘voluntary rules’’ for rating such overbroad? In addition, what standard any form of violent programming, in programming that were ‘‘acceptable to of constitutional review should apply to light of Section 326? Does the DC the Commission.’’ Does the reference to broadcast regulation in this area? To Circuit’s recent decision in Motion ‘‘violent or other indecent material’’ non-broadcast? Even if protecting Picture Association of America v. FCC indicate that indecency encompasses children from some form of violent (‘‘MPAA’’) suggest that the violence, or otherwise suggest that programming is deemed a sufficiently Commission’s public interest authority Congress intended to empower the important government interest, is a does not extend to regulation of violent agency to regulate violent programming? ‘‘safe harbor’’ the appropriate and most program content? Was the Commission’s authority under tailored means to accomplish that this provision at an end once it found public policy? Given the mechanisms 25. The statutory prohibition against the industry guidelines acceptable? In available to cable subscribers to block ‘‘obscene, indecent, or profane other words, does the statutory scheme programming under Title VI, could a language,’’ upon which our ban on suggest that Congress has occupied the ‘‘safe harbor’’ constitutionally be obscene speech and safe harbor for field of media violence, such that the applied to cable services? We seek indecent and profane speech are based, Commission cannot act without new comment on how Congress might does not implicate Section 326. Given legislation? legislate and the Commission might the interest of members of the House 27. What is the extent of the regulate in this area, consistent with Commerce Committee in creating a Commission’s current authority over applicable constitutional principles. ‘‘safe harbor,’’ and its question whether cable television in this area? Title VI of we currently have the authority to adopt the Act states that ‘‘[a]ny Federal III. Positive Impact of Certain such a mechanism to regulate violence, agency, State, or franchising authority Television Programming could the Commission expand its may not impose requirements regarding 29. We recognize that television definition of indecency to include the provision or content of cable programming may have a positive violent programming? The Commission services, except as provided in this influence on individual behavior, has traditionally defined indecency in title.’’ As indicated above, transmission especially educational and terms of sexual or excretory organs and of obscene and other speech is informational material directed at activities, but the Supreme Court has ‘‘unprotected by the Constitution of the children. The literature suggests that concluded that the term indecent United States’’ and is a criminal offense. consumption of educational television ‘‘merely refers to nonconformance with Title VI also states that, ‘‘[i]n order to programming correlates positively to accepted standards of morality’’ and restrict the viewing of programming children’s school preparedness and may that ‘‘neither our prior decisions nor the which is obscene or indecent, upon the also encourage beneficial social skills language or history of § 1464 supports request of a subscriber, a cable operator and behavioral development. Are there the conclusion that prurient appeal is an shall provide (by sale or lease) a device recent studies analyzing the pro-social essential component of indecent by which the subscriber can prohibit the effects of television programming that language.’’ Certain commentators go viewing of a particular cable service we should be aware of? What broadcast even further and argue that violent during periods selected by that or non-broadcast services carry such programming qualifies as obscene subscriber.’’ Title VI further states that material? How are parents made aware speech, which is not entitled to any ‘‘[u]pon request by a cable service that such programming is available? We First Amendment protection. In this subscriber, a cable operator shall, seek comment on what actions Congress regard, we note an opinion of the U.S. without charge, fully scramble or or the Commission may take to Court of Appeals for the Seventh Circuit otherwise fully block the audio and encourage more programming choices declining to conflate obscenity and video programming of each channel that have a positive effect on children’s violence in the context of a particular carrying such programming so that one development. ordinance regulating violent video not a subscriber does not receive it.’’ games, yet suggesting that a The Supreme Court has found this latter IV. Administrative Matters demonstrated link between exposure to provision could be a less restrictive 30. Ex Parte Rules. Pursuant to such games and deleterious effects means than a ‘‘safe harbor’’ or ‘‘time section 1.1204(b)(1) of the Commission’s
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rules, 47 CFR 1.1204(b)(1), this is an Secretary, Office of the Secretary, PERSON TO CONTACT FOR INFORMATION: exempt proceeding. Ex parte Federal Communications Commission. Mr. Robert Biersack, Acting Press presentations are permitted, and need 34. Additional Information. For Officer, Telephone: (202) 694–1220. not be disclosed. additional information on this Mary W. Dove, 31. Comments and Reply Comments. proceeding, contact Ben Golant at 418– Pursuant to sections 1.415 and 1.419 of 7111. Secretary of the Commission. the Commission’s rules, 47 CFR 1.415, [FR Doc. 04–18517 Filed 8–10–04; 10:43 am] V. Ordering Clause 1.419, interested parties must file BILLING CODE 6715–01–M comments on or before September 15, 35. Accordingly, it is ordered that, 2004, and reply comments on or before pursuant to the authority contained in October 15, 2004. Comments may be sections 4(i), 303(g), 303(r), and 403 of filed using the Commission’s Electronic the Communications Act, 47 U.S.C. FEDERAL RESERVE SYSTEM Comment Filing System (ECFS) or by 154(i), 303, and 403, this Notice of filing paper copies. See Electronic Filing Inquiry is adopted. Formations of, Acquisitions by, and of Documents in Rulemaking Mergers of Bank Holding Companies Federal Communications Commission. Proceedings, 63 FR 24121 (1998). Accessible formats (computer diskettes, William F. Caton, The companies listed in this notice large print, audio recording, and Braille) Deputy Secretary. have applied to the Board for approval, are available to persons with disabilities [FR Doc. 04–18467 Filed 8–11–04; 8:45 am] pursuant to the Bank Holding Company by contacting Brian Millin, of the BILLING CODE 6712–01–P Act of 1956 (12 U.S.C. 1841 et seq.) Consumer & Governmental Affairs (BHC Act), Regulation Y (12 CFR Part Bureau, at (202) 418–7426, TTY (202) 225), and all other applicable statutes 418–7365, or at [email protected]. and regulations to become a bank 32. Comments filed through the ECFS FEDERAL ELECTION COMMISSION holding company and/or to acquire the can be sent as an electronic file via the assets or the ownership of, control of, or Sunshine Act; Meeting Internet to http://www.fcc.gov/e-file/ the power to vote shares of a bank or ecfs.html. Generally, only one copy of bank holding company and all of the DATE AND TIME: Tuesday, August 17, an electronic submission must be filed. banks and nonbanking companies 2004 at 10 a.m. In completing the transmittal screen, owned by the bank holding company, commenters should include their full PLACE: 999 E Street, NW., Washington, including the companies listed below. name, U.S. Postal Service mailing DC. The applications listed below, as well address, and the applicable docket or STATUS: This meeting will be closed to as other related filings required by the rulemaking number. Parties may also the public. Board, are available for immediate submit an electronic comment by inspection at the Federal Reserve Bank ITEMS TO BE DISCUSSED: Internet e-mail. To get filing instructions indicated. The application also will be for e-mail comments, commenters Compliance matters pursuant to 2 available for inspection at the offices of should send an e-mail to [email protected], U.S.C. 437g. the Board of Governors. Interested and should include the following words Audits conducted pursuant to 2 persons may express their views in in the body of the message, ‘‘get form U.S.C. 437g, 438(b), and Title 26, U.S.C. writing on the standards enumerated in
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Board of Governors of the Federal Reserve DEPARTMENT OF HEALTH AND reducing retrovirus-associated System, August 6, 2004. HUMAN SERVICES morbidity and mortality. Prevention Robert deV. Frierson, programs, diagnostic clinics, and Deputy Secretary of the Board. Centers for Disease Control and seroprevalence studies rely not only on Prevention [FR Doc. 04–18410 Filed 8–11–04; 8:45 am] accurate antibody testing results to [30Day–04–0274] document HIV infection but also BILLING CODE 6210–01–S accurate CD4+ T-cell determinations and Proposed Data Collections Submitted HIV–1 viral RNA determinations. The for Public Comment and impetus for developing this program DEPARTMENT OF HEALTH AND Recommendations came from the recognized need to assess the quality of retroviral and AIDS- HUMAN SERVICES The Centers for Disease Control and related laboratory testing and to ensure Prevention (CDC) publishes a list of Office of the Secretary that the quality of testing was adequate information collection requests under to meet medical and public health review by the Office of Management and needs. The objectives of the MPEP are Notice of Interest Rate on Overdue Budget (OMB) in compliance with the to: (1) Develop appropriate methods for Debts Paperwork Reduction Act (44 U.S.C. evaluating quality in laboratory testing Chapter 35). To request a copy of these systems (including test selection, Section 30.13 of the Department of requests, call the CDC Reports Clearance sample collection, and reporting and Health and Human Services’ claims Officer at (404) 498–1210 or send an e- interpreting test results); (2) develop collection regulations (45 CFR part 30) mail to [email protected]. Send written strategies for identifying and correcting provides that the Secretary shall charge comments to CDC Desk Officer, Human testing quality failures; and (3) evaluate an annual rate of interest as fixed by the Resources and Housing Branch, New the effect of testing quality on public Secretary of the Treasury after taking Executive Office Building, Room 10235, health. into consideration private consumer Washington, DC 20503 or by fax to (202) rates of interest prevailing on the date 395–6974. Written comments should be This external quality assessment program will be made available at no that HHS becomes entitled to recovery. received within 30 days of this notice. cost (for receipt of sample panels) to The rate generally cannot be lower than Proposed Project sites conducting testing to detect human the Department of Treasury’s current CDC Model Performance Evaluation immunodeficiency virus type 1 (HIV–1) value of funds rate or the applicable rate Program (MPEP) for Retroviral and antibody (Ab), CD4+ T-cell determined from the ‘‘Schedule of AIDS-Related Testing, OMB No. 0920– determinations, and HIV–1 viral RNA Certified Interest Rates with Range of 0274—Revision—Public Health Practice determinations. This program will offer Maturities.’’ This rate may be revised Program Office (PHPPO), Centers for laboratories/testing sites an opportunity quarterly by the Secretary of the Disease Control and Prevention (CDC). for: Treasury and shall be published In 1986, the Centers for Disease • Assuring accurate tests are being quarterly by the Department of Health Control and Prevention (CDC) provided by the laboratory/testing site and Human Services in the Federal implemented the Model Performance through external quality assessment; Register. Evaluation Program (MPEP) to evaluate • Improving testing quality through The Secretary of the Treasury has the performance of laboratories self-evaluation in a non-regulatory 3 conducting testing to detect human certified a rate of 11 ⁄4% for the quarter environment; ended June 30, 2004. This interest rate immunodeficiency virus type 1 (HIV–1) • Testing well-characterized samples will remain in effect until such time as antibody (Ab), and to support CDC’s from a source outside the test kit mission of improving public health and the Secretary of the Treasury notifies manufacturer; preventing disease through HHS of any change. • continuously improving laboratory Discovering potential testing Dated: August 4, 2004. practices. problems so that procedures can be adjusted to eliminate them; Shirl Ruffin, High-quality HIV–1 antibody testing • Comparison of testing results with Acting Deputy Assistant Secretary, Finance. is essential to meeting the public health objectives for the prevention and control others at a national and international [FR Doc. 04–18364 Filed 8–11–04; 8:45 am] of this retrovirus infection. High-quality level; and BILLING CODE 4150–04–M CD4+ T-cell determinations and HIV–1 • Ability to consult with CDC staff to viral RNA (viral load) determinations discuss testing issues. are essential to HIV-infected patient care The burden is estimated to be and management, and the mission of approximately 1057 hours.
Number of re- Average burden Form name Number of re- sponses per re- per response spondents spondent (in hrs.)
Enrollments (new) ...... 100 1 3/60 HIV Testing Survey ...... 1,000 1 * 1 CD4+ T-cell determinations Survey ...... 325 1 *30/60 HIV–1 Ab PE Results Form ...... 900 2 10/60 HIV–1 RNA PE Results Form ...... 210 2 10/60 CD4+ T-cell determinations PE Results Form ...... 300 2 10/60 * Both the HIV and the CD4+ T-cell determinations surveys are performed every other year; therefore, the total hour burden for these two sur- veys are divided by two.
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Dated: August 5, 2004. C. Funding Administration, 5600 Fishers Lane, Alvin Hall, Approximately $250,000 is available Rockville, MD 20857, 301–827–1482. Director, Management Analysis and Services in FY 2005 to fund this award. It is SUPPLEMENTARY INFORMATION: In the Office, Centers for Disease Control and expected that the award will begin on or Federal Register of February 26, 2004 Prevention. before December, 2004, and will be (69 FR 8978), the agency announced [FR Doc. 04–18437 Filed 8–11–04; 8:45 am] made for an 18-month budget period that the proposed information collection BILLING CODE 4163–18–P within a project period of up to 18- had been submitted to OMB for review months. Funding estimates may change. and clearance under 44 U.S.C. 3507. An agency may not conduct or sponsor, and DEPARTMENT OF HEALTH AND D. Where To Obtain Additional Information a person is not required to respond to, HUMAN SERVICES a collection of information unless it For general comments or questions displays a currently valid OMB control Centers for Disease Control and about this announcement, contact: number. OMB has now approved the Prevention Technical Information Management, information collection and has assigned CDC Procurement and Grants Office, OMB control number 0910–0518. The [Program Announcement 05005] 2920 Brandywine Road, Atlanta, GA approval expires on June 30, 2007. A 30341–4146, telephone: 770–488–2700. copy of the supporting statement for this For technical questions about this Use of Electronic Data To Improve information collection is available on program, contact: Denise Cardo, M.D., Antimicrobial Use; Notice of Intent To the Internet at http://www.fda.gov/ Project Officer, Centers for Disease Fund Single Eligibility Award ohrms/dockets. Control and Prevention,National Center A. Purpose for Infectious Diseases,1600 Clifton Dated: August 5, 2004. Road, NE.,Mailstop A–07,Atlanta, GA The Centers for Disease Control and Jeffrey Shuren, 30333, telephone: 404–498–1160, e- Prevention (CDC) announces the intent Assistant Commissioner for Policy. mail: [email protected]. to fund fiscal year (FY) 2005 funds for [FR Doc. 04–18408 Filed 8–11–04; 8:45 am] a cooperative agreement program to Dated: August 6, 2004. BILLING CODE 4160–01–S evaluate the use of electronically- William P. Nichols, initiated interventions associated to Acting Director, Procurement and Grants educational interventions to improve Office, Centers for Disease Control and DEPARTMENT OF HEALTH AND antimicrobial use in hospitals. The Prevention. HUMAN SERVICES Catalog of Federal Domestic Assistance [FR Doc. 04–18436 Filed 8–11–04; 8:45 am] number for this program is 93.283. BILLING CODE 4163–18–P Health Resources and Services Administration B. Eligible Applicant DEPARTMENT OF HEALTH AND Recruitment of Sites for Assignment of Assistance will be provided only to HUMAN SERVICES Corps Personnel the Cook County Bureau of Health Services, Hekoteon Institute. For the Food and Drug Administration AGENCY: Health Resources and Services past five years (12/98 thru 11/2004), the Administration (HRSA), HHS. Cook County Bureau of Health Services [Docket No. 2003D–0229] ACTION: General notice. has been awarded funds under Program Agency Information Collection Announcement 98039 entitled Activities; Announcement of Office of SUMMARY: The Health Resources and ‘‘Programs to Prevent the Emergence Management and Budget Approval; Services Administration (HRSA) and Spread of Antimicrobial Resistance: Guidance for Industry on Continuous announces that the listing of entities, Chicago Antimicrobial Resistance Marketing Applications; Pilot 2— and their Health Professional Shortage Project (CARP).’’ The CARP project has Scientific Feedback and Interactions Area (HPSA) scores, that will receive an existing computer-based surveillance During Development of Fast Track priority for the assignment of National system with the ability to merge patient- Products Under the Prescription Drug Health Service Corps (NHSC) personnel level pharmacy and lab (micro, renal User Fee Act function, etc.) data; an algorithm (Corps Personnel) for the period July 1, developed and tested to detect patient AGENCY: Food and Drug Administration, 2004 through June 30, 2005 is posted on receiving potentially redundant HHS. the NHSC Web site at http:// antimicrobial therapy; the ability to ACTION: Notice. nhsc.bhpr.hrsa.gov/resources/fedreg- electronically assess antibiotic use and hpol/. This list specifies which entities antibiotic starts from date warehouse SUMMARY: The Food and Drug are eligible to receive assignment of and data on redundant antimicrobial Administration (FDA) is announcing Corps members who are participating in use. CARP also has data on about 1189 that a collection of information entitled the NHSC Scholarship Program; the inpatients: 192 received potentially ‘‘Guidance for Industry: Continuous NHSC Loan Repayment Program; and redundant antibiotics; in 71 percent, the Marketing Applications; Pilot 2— Corps members who have become Corps use of redundant antibiotics was Scientific Feedback and Interactions members other than pursuant to inappropriate. Following identification During Development of Fast Track contractual obligations under the of inappropriate use, 98 percent of Products Under PDUFA’’ has been Scholarship or Loan Repayment episodes were corrected by a clinical approved by the Office of Management Programs. Please note that not all pharmacist. Further evaluation is and Budget (OMB) under the Paperwork vacancies associated with sites on this critical to assess educational Reduction Act of 1995. list will be for Corps members, but interventions that could be generalized FOR FURTHER INFORMATION CONTACT: could be for individuals serving an to several healthcare facilities where a Karen L. Nelson, Office of Management obligation to the NHSC through the pharmacist is not available. Programs (HFA–250), Food and Drug Private Practice Option.
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Eligible HPSAs and Entities status of an NHSC clinician at the site; the Loan Repayment Program (i.e., To be eligible to receive assignment of (3) provide the time and leave records, HPSAs scoring 14 or above). Placements Corps personnel, entities must: (1) Have schedules, and any related personnel made through the Loan Repayment a current HPSA designation by the documents for NHSC assignees Program in HPSAs with scores 13 or Shortage Designation Branch in the (including documentation, if applicable, below will be made by decreasing HPSA National Center for Health Workforce of the reason(s) for the termination of an score, and only to the extent that Analysis, Bureau of Health Professions, NHSC clinician’s employment at the site funding remains available. All sites on Health Resources and Services prior to his or her obligated service end the list are eligible sites for individuals Administration; (2) enter into an date); and (4) submit a Uniform Data wishing to serve in an underserved area agreement with the State agency that System (UDS) report. This system but who are not contractually obligated administers Medicaid, accept payment allows the site to assess the age, sex, under the Scholarship or Loan under Medicare and the State Children’s race/ethnicity of, and provider Repayment Program. A listing of HPSAs Health Insurance Program, see all encounter records for, its user and their scores is posted at http:// patients regardless of their ability to population. The UDS reports are site belize.hrsa.gov/newhpsa/newhpsa.cfm. pay, and use and post a discounted fee specific. Providers fulfilling NHSC Sites qualifying for an automatic plan; and (3) be determined by the commitments are assigned to a specific primary care HPSA designation have Secretary to have (a) a need and demand site or, in some cases, more than one been scored and may be authorized to site. The scope of activity to be reported for health manpower in the area; (b) receive assignment of Corps members if in UDS includes all activity at the site(s) appropriately and efficiently used Corps they meet the criteria outlined above to which the Corps member is assigned. members assigned to the entity; (c) and their automatic primary care HPSAs general community support for the Evaluation and Selection Process assigned scores are above the stated assignment of Corps members; (d) made cutoffs. Sites qualifying for an automatic In approving applications for the mental health or dental HPSA unsuccessful efforts to recruit; and (e) a assignment of Corps members, the reasonable prospect for sound fiscal designation are currently unscored. A Secretary shall give priority to any such methodology to score these automatic management by the entity with respect application that is made regarding the to Corps members assigned there. HPSAs is currently being developed. provision of primary health services to Sites on the list with an unscored HPSA Priority in approving applications for a HPSA with the greatest such shortage. designation are authorized for the assignment of Corps members goes to For the program year July 1, 2004–June assignment of Corps personnel sites that (1) provide primary, mental, or 30, 2005, HPSAs of greatest shortage for participating in the Loan Repayment oral health services to a HPSA of determination of priority for assignment Program only, after assignments are greatest shortage; (2) are part of a system of Corps personnel will be defined as made of those Corps members matching of care that provides a continuum of follows: (1) Primary care HPSAs with to scored HPSAs and only to the extent services, including comprehensive scores of 14 and above are authorized that funding remains available. When primary health care and appropriate for the assignment of Corps members automatic HPSAs receive scores, these referrals or arrangements for secondary who are primary care physicians sites will then be authorized to receive and tertiary care; (3) have a documented participating in the Scholarship record of sound fiscal management; and Program; (2) primary care HPSAs with assignment of Corps members if they (4) will experience a negative impact on scores of 13 and above are authorized meet the criteria outlined above and its capacity to provide primary health for the assignment of Corps members their newly assigned scores are above services if a Corps member is not who are family nurse practitioners (NPs) the stated cutoffs. assigned to the entity. and physician assistants (PAs) The number of new NHSC placements Entities that receive assignment of participating in the Scholarship through the Scholarship and Loan Corps personnel must assure that (1) the Program; (3) primary care HPSAs with Repayment programs allowed at any one position will permit the full scope of scores of 8 and above are authorized for site are limited to the following: practice and that the clinician meets the the assignment of Corps members who (1) Primary Health Care. credentialing requirements of the State are CNMs participating in the (a) Loan Repayment Program—no and site; and (2) the Corps member Scholarship Program; (4) mental health more than 2 physicians (MD or DO); and assigned to the entity is engaged in full- HPSAs with scores of 20 and above are no more than a combined total of 2 NPs, time clinical practice for a minimum of authorized for the assignment of Corps PAs, or CNMs. 40 hours per week with at least 32 hours members who are physician (b) Scholarship Program—no more per week in the ambulatory care setting. psychiatrists participating in the than 2 physicians (MD or DO); and no Obstetricians/gynecologists, certified Scholarship Program; (5) dental HPSAs more than a combined total of 2 NPs, nurse midwives (CNMs), and family with scores of 20 and above are PAs, or CNMs. practitioners who practice obstetrics on authorized for the assignment of Corps (2) Dental. a regular basis, are required to engage in members who are dentists participating (a) Loan Repayment Program—no a minimum of 21 hours per week of in the Scholarship Program; and (6) more than 2 dentists and 2 dental outpatient clinical practice. The HPSAs (appropriate to each discipline) hygienists. remaining hours, making up the 40-hour with scores of 14 and above are (b) Scholarship Program—no more per week total, include delivery and authorized for the assignment of Corps than 1 dentist. other clinical hospital-based duties. members who are participating in the (3) Mental Health. Time spent on-call does not count Loan Repayment Program. HPSAs with (a) Loan Repayment Program—no toward the 40 hours per week. In scores below 14 will be eligible to more than 2 psychiatrists (MD or DO); addition, sites receiving assignment of receive assignment of Corps personnel and no more than a combined total of Corps personnel are expected to (1) participating in the Loan Repayment 2 clinical or counseling psychologists; report to the NHSC all absences in Program only after assignments are licensed clinical social workers, excess of the authorized number of days made of those Corps members matching licensed professional counselors, (up to 35 work days or 280 hours); (2) to those HPSAs receiving priority for marriage and family therapists, or report to the NHSC any change in the placement of Corps members through psychiatric nurse specialists.
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(b) Scholarship Program—no more Additional Information DEPARTMENT OF HEALTH AND than 1 psychiatrist. HUMAN SERVICES Entities wishing to provide additional Application Requests, Dates and data and information in support of their Office of Inspector General Address inclusion on the proposed list of HPSAs The list of HPSAs and entities that are and entities that would receive priority Program Exclusions: July 2004 in assignment of Corps members, must eligible to receive priority for the AGENCY: do so in writing no later than September Office of Inspector General, placement of Corps personnel may be HHS. updated periodically. Entities that no 13, 2004. This information should be ACTION: Notice of program exclusions. longer meet eligibility criteria, including submitted to the National Health Service Corps, 5600 Fishers Lane, Room HPSA score, will be removed from the During the month of July 2004, the 8A–55, Rockville, MD 20857. This priority listing. Entities interested in HHS Office of Inspector General information will be considered in being added to the high priority list imposed exclusions in the cases set preparing the final list of HPSAs and must submit an NHSC Recruitment and forth below. When an exclusion is entities that are receiving priority for the Retention Assistance Application to: imposed, no program payment is made assignment of Corps personnel. National Health Service Corps, 5600 to anyone for any items or services(other Fishers Lane, Room 8A–55, Rockville, Paperwork Reduction Act than an emergency item or service not MD 20857, fax (301) 594–2721. These provided in a hospital emergency room) applications must be submitted on or The Recruitment & Retention furnished, ordered or prescribed by an before the deadline date of March 25, Assistance Application has been excluded party under the Medicare, 2005. Applications submitted after this approved by the Office of Management Medicaid, and all Federal Health Care deadline date will be considered for and Budget under the Paperwork programs. In addition, no program placement on the priority placement list Reduction Act. The OMB clearance payment is made to any business or in the following program year. Any number is 0915–0230. facility, e.g., a hospital, that submits changes to this deadline will be posted The program is not subject to the bills for payment for items or services on the NHSC Web site at http:// provision of Executive Order 12372, provided by an excluded party. Program nhsc.bhpr.hrsa.gov. Intergovernmental Review of Federal beneficiaries remain free to decide for Entities interested in receiving Programs (as implemented through 45 themselves whether they will continue application materials may do so by CFR part 100). to use the services of an excluded party calling the NHSC call center at 1–800– even though no program payments will Dated: August 4, 2004. 221–9393. They may also get be made for items and services provided information and download application Elizabeth M. Duke, by that excluded party. The exclusions materials from: http:// Administrator. have national effect and also apply to all nhsc.bhpr.hrsa.gov/applications/ [FR Doc. 04–18409 Filed 8–11–04; 8:45 am] Executive Branch procurement and non- rraa.cfm. BILLING CODE 4165–15–P procurement programs and activities.
Effective Subject name Address date
Program-Related Convictions
Agyemang, Kwadwo ...... Union, NJ ...... 8/19/2004 Albanese, Gabriella ...... Albion, NY ...... 8/19/2004 Artsrounian, Haik ...... Taft, CA ...... 8/19/2004 Bardo, Manuel ...... Miami, FL ...... 8/19/2004 Bejanzadeh, Emil ...... North Las Vegas, NV ...... 8/19/2004 Bielaus, Michael ...... Kenner, LA ...... 8/19/2004 Breslow, Julian ...... Boca Raton, FL ...... 2/10/2004 Butcher, Holly ...... The Colony, TX ...... 8/20/2002 Callejas, Juana ...... Adelanto, CA ...... 8/19/2004 Canon, Robert ...... Shelbyville, TN ...... 8/19/2004 Carroll, Lynda ...... Ellensburg, WA ...... 8/19/2004 Castaneto, Orlando ...... Carson, CA ...... 8/19/2004 Ciraolo, Costanza ...... Rancho Palose Verdes, CA ...... 8/19/2004 Ciraolo, Juan ...... Taft, CA ...... 8/19/2004 Cloyd, Tonya ...... Milwaukee, WI ...... 8/19/2004 Cogdell, Myra ...... Wyandanch, NY ...... 8/19/2004 Collado-Marcial, Jose ...... Toa Baja, PR ...... 8/19/2004 Courtney, Rachel ...... Coshocton, OH ...... 8/19/2004 Darr, Adele ...... Taylor, AZ ...... 5/22/2004 Darr, James ...... Phoenix, AZ ...... 5/22/2004 Foster, Travis ...... Atlanta, GA ...... 8/19/2004 Gallego, Robert ...... Marina, CA ...... 8/19/2004 Gonzalez, Luisa ...... Adelanto, CA ...... 8/19/2004 Helterbran, Cheryl ...... Columbus, OH ...... 8/19/2004 Hudkins, James ...... Shelton, WA ...... 8/19/2004 Hyman, Parnell ...... Yankton, SD ...... 8/19/2004 Johnson, Nathan ...... Texarkana, TX ...... 8/19/2004 Jones, Teresa ...... Milwaukee, WI ...... 8/19/2004 Joyce, James ...... Goldsboro, NC ...... 8/19/2004 Khachatrian, Sarkis ...... Lompoc, CA ...... 8/19/2004 Lawrence, Gwendolyn ...... Cleveland, OH ...... 8/19/2004
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Effective Subject name Address date
Loberg, Kellie ...... Jacobson, MN ...... 8/19/2004 Lodge, Craig ...... Duluth, GA ...... 8/19/2004 Martin, Bennie ...... Paterson, NJ ...... 8/19/2004 Martin, Valeria ...... Milwaukee, WI ...... 8/19/2004 McKenzie, Eunice ...... Mt Vernon, NY ...... 8/19/2004 Meirink, Lillian ...... Topeka, KS ...... 8/19/2004 Misorski, John ...... Beaver, PA ...... 8/19/2004 Monroe-Gonroff, Tami ...... Oregon City, OR ...... 8/19/2004 Morse, Teresita ...... Edmonds, WA ...... 8/19/2004 Murphy, Charles ...... Clinton, NC ...... 8/19/2004 Parker, Kenneth ...... Ellenwood, GA ...... 8/19/2004 Pena, Irma ...... Los Angeles, CA ...... 8/19/2004 Reiss, Moshe ...... Brooklyn, NY ...... 8/19/2004 Renick, John ...... Panama City, FL ...... 8/20/2002 Ridgeley, Deborah ...... Phoenix, AZ ...... 8/19/2004 Ridgeley, Richard ...... Taft, CA ...... 8/19/2004 Rowland, Tara ...... East Columbus, OH ...... 8/19/2004 Ruffin, Shalonte ...... Scotland Neck, NC ...... 8/19/2004 Shams, Imran ...... Huntington Beach, CA ...... 8/19/2004 Stewart, Allan ...... Elk, WA ...... 8/19/2004 Tecson, Ronaldo ...... Eloy, AZ ...... 8/19/2004 Varda, Ann ...... Chisholm, MN ...... 8/19/2004 Warwick, Julius ...... Coolidge, AZ ...... 8/19/2004 Watson, Bernetta ...... Idaho Falls, ID ...... 8/19/2004 Wegner, Kathleen ...... Billings, MT ...... 8/19/2004 White, Timothy ...... New York, NY ...... 8/19/2004 Williams, Donald ...... Jonesboro, GA ...... 8/19/2004 Woodward, David ...... Loretta, PA ...... 8/19/2004
Felony Conviction for Health Care Fraud
Acosta, Erma ...... Sebring, FL ...... 8/19/2004 Barclay, Aaronette ...... Maplewood, MN ...... 8/19/2004 Becker, Tina ...... Sidney, OH ...... 8/19/2004 Besel, Cheryl ...... Wichita, KS ...... 8/19/2004 Chavez, Genesis ...... Campbell, CA ...... 8/19/2004 Coss-Rea, Christine ...... Painesville, OH ...... 8/19/2004 Fennell, Dennis ...... Georgetown, TX ...... 8/19/2004 Fields, Dana ...... Clearwater, FL ...... 8/19/2004 Finder, Richard ...... Watermill, NY ...... 8/19/2004 Garish, Corena ...... Dayton, OH ...... 8/19/2004 Greenbaum, Irwin ...... Greenville, MI ...... 8/19/2004 Johnson, Vernon ...... Achille, OK ...... 8/19/2004 Laboe, Bradley ...... Onsted, MI ...... 8/19/2004 LeQuatte, Ernest ...... Herrin, IL ...... 8/19/2004 Parmenter, Betty ...... Grants Pass, OR ...... 8/19/2004 Redding, James ...... Minersville, PA ...... 8/19/2004 Ruiz, Denise ...... Port St Lucie, FL ...... 8/19/2004 Sherman, Josef ...... Eglin AFB, FL ...... 8/19/2004 Sherman, Yevgeny ...... Coleman, FL ...... 8/19/2004
Felony Control Substance Conviction
Anderson, Stephanie ...... Bloomington, IN ...... 8/19/2004 Anthony, Joseph ...... Raiford, FL ...... 8/19/2004 Buchman, Jacquelyn ...... Westlake, OH ...... 8/19/2004 Burdine, Elizabeth ...... Wakeman, OH ...... 8/19/2004 Cohen, Abbott ...... Alpena, MI ...... 8/19/2004 Cooper, Frank ...... Houston, TX ...... 8/19/2004 Cummings, Angelique ...... N Richland Hills, TX ...... 8/19/2004 Gates, Thomas ...... West Branch, MI ...... 8/19/2004 Goodin, Richard ...... Ogdensburg, NY ...... 8/19/2004 Ollison, Tommy ...... Gonzales, TX ...... 8/19/2004 Salem, Salem ...... St Thomas, VI ...... 8/19/2004 Salem-Zuhdi, Rushdi ...... Eglin AFB, FL ...... 8/19/2004 Santos, Rodolfo ...... Lexington, KY ...... 8/19/2004 Sawaf, Ali ...... Glenville, WV ...... 8/19/2004 Thibodeau, Anne ...... Biddeford, ME ...... 8/19/2004 Yabut-Baluyut, Fredesminda ...... Dublin, CA ...... 8/19/2004
Patient Abuse/Neglect Convictions
Ahmed, Azzam ...... London, OH ...... 8/19/2004
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Effective Subject name Address date
Beeman, Lawrence ...... Greeley, CO ...... 8/19/2004 Beran, Nancy ...... Bouckville, NY ...... 8/19/2004 Borela, Lincoln ...... Belle Plaine, MN ...... 8/19/2004 Brown, Caryn ...... Benton Harbor, MI ...... 8/19/2004 Day, Arlene ...... Bronx, NY ...... 8/19/2004 Duval, Wilna ...... Westbury, NY ...... 8/19/2004 Fehr, Myra-Becca ...... Wilsonville, OR ...... 8/19/2004 Green, Mark ...... Akron, OH ...... 8/19/2004 Hayes, Robert ...... Toledo, OH ...... 8/19/2004 Hayes, Timothy ...... Wayne, PA ...... 8/19/2004 Headley, Peggy ...... Williamsburg, OH ...... 8/19/2004 Heavenly Care Remember Me, Inc ...... Milwaukee, WI ...... 8/19/2004 Herring, Lionel ...... Washington, DC ...... 8/19/2004 Jenkins, Michelle ...... Oswego, NY ...... 8/19/2004 Lafon, Michael ...... Haddonfield, NJ ...... 8/19/2004 Leisure Living Management of Lansing, Inc ...... Lowell, MI ...... 8/19/2004 Levingston, Lashun ...... Milwaukee, WI ...... 8/19/2004 McCrimmon, Samantha ...... McRae, GA ...... 8/19/2004 Montgomery, Muriel ...... Delhi, LA ...... 8/19/2004 Murphy, Ruth ...... Ludow, KY ...... 8/19/2004 Patchett, Brenda ...... McMinnville, OR ...... 8/19/2004 Robbins, Tracey ...... Buffalo, NY ...... 8/19/2004 Robinzine, Shuntay ...... Enid, MS ...... 8/19/2004 Rowland, Kevin ...... Platte City, MO ...... 8/19/2004 Tacras, Joel ...... Waipahu, HI ...... 8/19/2004 Veales, Tamara ...... Pauls Valley, OK ...... 8/19/2004 Walton, Michael ...... Airway Heights, WA ...... 8/19/2004 Washington, Cassandra ...... Bunkie, LA ...... 8/19/2004 Williams, Joyce ...... Rochester, NY ...... 8/19/2004 Williams, Thomas ...... Towson, MD ...... 8/19/2004 Woodall, Clarence ...... Jackson, MS ...... 8/19/2004
Conviction for Health Care Fraud
Turner, Lynda ...... Baton Rouge, LA ...... 8/19/2004
License Revocation/Suspension/Surrendered
Adams, William ...... Acton, CA ...... 8/19/2004 Akers, Cynthia ...... Kokomo, IN ...... 8/19/2004 Amanatullah, Frank ...... Pocatello, ID ...... 8/19/2004 Amontos, Bonifacio ...... Carson, CA ...... 8/19/2004 Amsden, Ann ...... Colusa, CA ...... 8/19/2004 Anderson, Lynette ...... Mead, WA ...... 8/19/2004 Anderson, Tommie ...... Columbia, MS ...... 8/19/2004 Armstrong, Elizabeth ...... Lancaster, OH ...... 8/19/2004 Astarita, Margaret ...... Georgetown, TX ...... 8/19/2004 Aviles, Veronica ...... Santa Ana, CA ...... 8/19/2004 Bangkok Health Club ...... Tampa, FL ...... 8/19/2004 Barnett, Clarence ...... Laurel, MS ...... 8/19/2004 Bays, Barbara ...... Barbourville, KY ...... 8/19/2004 Beccue, Diana ...... Altamont, IL ...... 8/19/2004 Bennett, Betty ...... Echola, AL ...... 8/19/2004 Bettini, Janice ...... Andover, MA ...... 8/19/2004 Bohlen, Myra ...... Awendaw, SC ...... 8/19/2004 Bunting, Melanie ...... Indianapolis, IN ...... 8/19/2004 Carl, Cynthia ...... Goodyear, AZ ...... 8/19/2004 Cerny, Jerome ...... Terre Haute, IN ...... 8/19/2004 Chung, Kapeun ...... Farmington, MO ...... 8/19/2004 Connolly, Joyce ...... Chelmsford, MA ...... 8/19/2004 Cooper, Patricia ...... Aledo, IL ...... 8/19/2004 Cortez, Federico ...... El Monte, CA ...... 8/19/2004 Cowlin, Christine ...... Pittsfield, MA ...... 8/19/2004 Coy, Frederick ...... Tucson, AZ ...... 8/19/2004 Crenshaw, Sherrie ...... Nice, CA ...... 8/19/2004 Crystal’s Beauty Salon, Inc ...... Miami, FL ...... 8/19/2004 Cusack, Deborah ...... Poulsbo, WA ...... 8/19/2004 Devi, Mani Manjari ...... Brooklyn, NY ...... 8/19/2004 Dicke, John ...... Morrison, CO ...... 8/19/2004 Dieterle, Karen ...... Sickerville, NJ ...... 8/19/2004 Dietz, Kim ...... Rapid City, SD ...... 8/19/2004 Dinsmore, Karen ...... Wilsonville, OR ...... 8/19/2004 Donnelly, Paula ...... Harvest, AL ...... 8/19/2004
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Effective Subject name Address date
Dooley, Linda ...... N Quincy, MA ...... 8/19/2004 Florence, Tina ...... Warrior, AL ...... 8/19/2004 Francis, Elizabeth ...... Phoenix, AZ ...... 8/19/2004 Franklin, Lawanda ...... Mobile, AL ...... 8/19/2004 Freed, Sheryl ...... Rock Island, IL ...... 8/19/2004 Gonzoph, Barbara ...... Collingswood, PA ...... 8/19/2004 Goulbourne, Apryl ...... Huntsville, AL ...... 8/19/2004 Green, Charleen ...... Fredrick, OK ...... 8/19/2004 Haines, Ramona ...... Marlton, NJ ...... 8/19/2004 Haley, Dellashawn ...... Long Beach, CA ...... 8/19/2004 Hannam, Kelly ...... Wasilla, AK ...... 8/19/2004 Harris, Linda ...... Desert Hot Springs, CA ...... 8/19/2004 Herrington, Kelli ...... Tulsa, OK ...... 8/19/2004 Hill, Cheryl ...... Waterloo, IA ...... 8/19/2004 Hixson, Karin ...... Pompano Beach, FL ...... 8/19/2004 Hobbs, Tina ...... Bakersfield, CA ...... 8/19/2004 Hoffman, Jerri ...... Lawton, OK ...... 8/19/2004 Hooks, James ...... Northglenn, CO ...... 8/19/2004 Hurt, Winifred ...... Lockport, IL ...... 8/19/2004 Hutchings, Tyson ...... Cameron Park, CA ...... 8/19/2004 Jackson, Cindy ...... Gadsden, AL ...... 8/19/2004 Jarrett, Betty ...... Sierra Vista, AZ ...... 8/19/2004 Jobe, Judy ...... Boise, ID ...... 8/19/2004 Johnson, Frank ...... St Paul, MN ...... 8/19/2004 Kelly, Cory ...... Birmingham, AL ...... 8/19/2004 King, John ...... West Memphis, AR ...... 8/19/2004 Krist, Gary ...... Auburn, GA ...... 8/19/2004 Lawson, Janis ...... Cincinnati, OH ...... 8/19/2004 Levy, Stephen ...... Wilton, CT ...... 8/19/2004 Lipsey, Joyce ...... Plantersville, MS ...... 8/19/2004 Lorenzo, Roberto ...... Rosemead, CA ...... 8/16/2004 Lucchetti, Frank ...... Napa, CA ...... 8/19/2004 Lynn, Laura ...... Bessemer, AL ...... 8/19/2004 Martin, Sandra ...... Birmingham, AL ...... 8/19/2004 Martinez, Priscilla ...... Seattle, WA ...... 8/19/2004 Matticks, Penni ...... Springfield, IL ...... 8/19/2004 Mawikere, Sandy ...... Upland, CA ...... 8/19/2004 Mays, Jessica ...... Haleyville, AL ...... 8/19/2004 McBroom, Melanie ...... Big Pine Key, FL ...... 8/19/2004 McKenzie, Jennie ...... Fulton, IL ...... 8/19/2004 McLean-Neufeld, Richard ...... Mankato, MN ...... 8/19/2004 Mester, Carol ...... Mineville, NY ...... 8/19/2004 Mick, Cheri ...... Sun City, AZ ...... 8/19/2004 Miller, Patricia ...... Edwardsburg, MI ...... 8/19/2004 Miller, Sean ...... Las Vegas, NV ...... 8/19/2004 Moore, Emery ...... Fallbrook, CA ...... 8/19/2004 Morgan, Katherine ...... Silverton, OR ...... 8/19/2004 Nash, Julia ...... Irvine, CA ...... 8/19/2004 Norris, Heather ...... Bronx, NY ...... 8/19/2004 Oehmen, Judith ...... Burbank, CA ...... 8/19/2004 Payne, Angel ...... Clayton, WA ...... 8/19/2004 Pepper, Joan ...... Cape May, NJ ...... 8/19/2004 Perry, Josie ...... Minneapolis, KS ...... 8/19/2004 Pickett, Kim ...... Salt Lake, UT ...... 8/19/2004 Pitts, Amanda ...... Bothell, CA ...... 8/19/2004 Pletz, John ...... San Francisco, CA ...... 8/19/2004 Ponce, Ines ...... Baldwin Park, CA ...... 8/19/2004 Price, Jeri ...... Pismo Beach, CA ...... 8/19/2004 Rath, Siddhartha ...... Shreveport, LA ...... 8/19/2004 Reed, John ...... Chicago, IL ...... 8/19/2004 Reed, Tracey ...... Winchester, IL ...... 8/19/2004 Reid, Kathleen ...... Las Vegas, NV ...... 8/19/2004 Riley, Jason ...... Indianapolis, IN ...... 8/19/2004 Riley, Johnnie ...... Kankakee, IL ...... 8/19/2004 Riley, Thad ...... Milton, FL ...... 8/19/2004 Rodriquez, Sonia ...... Lewisville, TX ...... 8/19/2004 Rogers-Faneuf, Richelle ...... Peabody, MA ...... 8/19/2004 Root, Delena ...... Winooski, VT ...... 8/19/2004 Satterley, Charles ...... Bellport, NY ...... 8/19/2004 Schutt, Michelle ...... Leroy, NY ...... 8/19/2004 Shaver, Steven ...... Las Vegas, NV ...... 7/23/2004 Short, Susan ...... Kodiak, AK ...... 8/19/2004 Shriver, Sue ...... Winston-Salem, NC ...... 8/19/2004
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Effective Subject name Address date
Sigler, Ruth ...... Danville, IL ...... 8/19/2004 Simonds, Shantri ...... Claremont, NH ...... 8/19/2004 Sims, Gary ...... Laurel, MS ...... 8/19/2004 Slief, Mary ...... Dallas, TX ...... 8/19/2004 Sneed, Andrew ...... Boulder City, NV ...... 8/19/2004 Stanton, Jacquelyn ...... Denver, CO ...... 8/19/2004 Stephens, Grant ...... McMinnville, OR ...... 8/19/2004 Stone, Kokoro ...... Portland, OR ...... 8/19/2004 Stuart, Christine ...... North Manchester, IN ...... 8/19/2004 Tiernan, Kevin ...... Louisville, KY ...... 8/19/2004 Torres, Julian ...... Santa Ana, CA ...... 8/19/2004 Tyrrell, Mark ...... Little Falls, NJ ...... 8/19/2004 Urbina, Ibis ...... Merced, CA ...... 8/19/2004 Vannoy, Angela ...... North Vernon, IN ...... 8/19/2004 Wadley, Stephanie ...... Grove, OK ...... 8/19/2004 White, Melody ...... Saint Augustine, FL ...... 8/19/2004 Yarbrough, Kimberly ...... Jackson Gap, AL ...... 8/19/2004 Ziegler, Stephanie ...... Harmony, PA ...... 8/19/2004 Zimmerman, Richard ...... Grand Rapids, MI ...... 8/19/2004 Zins, Patricia ...... Boise, ID ...... 8/19/2004
Federal/State Exclusion/Suspension
Brown, Thomas ...... Carlinville, IL ...... 8/19/2004 Daley, Rebecca ...... Pembroke, ME ...... 8/19/2004 Stamboliu, Dan ...... Chicago, IL ...... 8/19/2004 Yamini, Dorian ...... Olympia Fields, IL ...... 8/19/2004
Fraud/Kickbacks/Prohibited Acts/Settlement Agreements
American Home Vision ...... St Louis, MO ...... 3/15/2004 Goldberg, Steven ...... Chesterfield, MO ...... 3/15/2004
Owned/Controlled by Convicted Entities
Acupuncture Chiropractic Medical Clinic ...... Los Angeles, CA ...... 8/19/2004 Back to Health, Inc ...... Los Altos, CA ...... 8/19/2004 Better Health Pharmacy, Inc ...... Brooklyn, NY ...... 8/19/2004 Brooklyn Medical Arts HIV Care, PC ...... Brooklyn, NY ...... 8/19/2004 John A Giddings, MD, Inc ...... Duarte, CA ...... 8/19/2004 Keith R Ohanesian, DC ...... Sherman Oaks, CA ...... 8/19/2004 Kubski & Kubski, MD, PA ...... West Palm Beach, FL ...... 8/19/2004 MIA Transportation Services, Inc ...... Euclid, OH ...... 8/19/2004 Michael W Hardee, DMD, MS, PA ...... Seminole, FL ...... 8/19/2004 Southern California Cardiology ...... Duarte, CA ...... 8/19/2004
Default on Heal Loan
Bennett, Chris ...... Wichita, KS ...... 8/19/2004 Davidek, Rosali ...... Riverside, CA ...... 8/19/2004 McKay, Kevin ...... Dallas, TX ...... 8/19/2004 Ofor, Chukwu ...... Houston, TX ...... 8/19/2004 Schoonover, John ...... Desoto, TX ...... 8/19/2004 Sinclair, Blake ...... Tyler, TX ...... 8/19/2004 Swella, Jeffrey ...... St Petersburg, FL ...... 8/19/2004 Ybanez, Manuel ...... Lakeland, FL ...... 8/19/2004
Dated: July 4, 2004. DEPARTMENT OF HOMELAND SUMMARY: The Coast Guard seeks Kathleen Pettit, SECURITY applications for membership on the Acting Director, Exclusion Staff, Office of National Offshore Safety Advisory Inspector General. Coast Guard Committee (NOSAC). NOSAC provides [FR Doc. 04–18411 Filed 8–11–04; 8:45 am] advice and makes recommendations to the Coast Guard on matters affecting the BILLING CODE 4150–04–P [USCG–2004–18834] offshore industry. National Offshore Safety Advisory DATES: Application forms should reach Committee; Vacancies the Coast Guard on or before September 30, 2004. AGENCY: Coast Guard, DHS. ADDRESSES: You may request an ACTION: Request for applications. application form by writing to
VerDate jul<14>2003 17:55 Aug 11, 2004 Jkt 203001 PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 E:\FR\FM\12AUN1.SGM 12AUN1 Federal Register / Vol. 69, No. 155 / Thursday, August 12, 2004 / Notices 49913
Commandant (G–MSO–2), U.S. Coast Each member normally serves a term of Aquatic Nuisance Species Task Force Guard, 2100 Second Street SW., 3 years, or until a replacement is Western Regional Panel. The Task Force Washington, DC 20593–0001; by calling appointed. Some members may serve was established by the Nonindigenous (202) 267–1082; or by faxing (202) 267– consecutive terms. All members serve at Aquatic Nuisance Prevention and 4570. A copy of the application form is their own expense and receive no Control Act of 1990. The Western also available from the Coast Guard’s salary, reimbursement of travel Regional Panel was established by the Advisory Committee Web page at: expenses, or other compensation from ANS Task Force in 1997 and is http://www.uscg.mil/hq/g-m/advisory/ the Federal Government. comprised of representatives from index.htm. Send your application in In support of the policy of the Coast Federal, State, and local agencies and written form to the above street address. Guard on gender and ethnic diversity, from private environmental and This notice is available on the Internet we encourage qualified women and commercial interests. at http://dms.dot.gov. members of minority groups to apply. The purpose of the Panel is to advise FOR FURTHER INFORMATION CONTACT: Dated: August 5, 2004. and make recommendations to the Commander John M. Cushing, Executive Aquatic Nuisance Species Task Force on Joseph J. Angelo, issues relating to the Western region of Director of NOSAC, or James M. Magill, Director of Standards, Marine Safety, Security Assistant to the Executive Director, the United States that includes: Alaska, and Environmental Protection. Arizona, California, Colorado, Guam, telephone (202) 267–1082, fax (202) [FR Doc. 04–18472 Filed 8–11–04; 8:45 am] 267–4570. Hawaii, Idaho, Kansas, Montana, North BILLING CODE 4910–15–P Dakota, Nebraska, Nevada, New Mexico, SUPPLEMENTARY INFORMATION: NOSAC is Oklahoma, Oregon, South Dakota, a Federal advisory committee Texas, Utah, Washington, and established under the provisions of the DEPARTMENT OF THE INTERIOR Wyoming. Responsibilities of the Panel Federal Advisory Committee Act include: (FACA), 5 U.S.C. App. 2 (Pub. L. 92– Fish and Wildlife Service a. Identifying priorities for the 463, 86 Stat. 770, as amended). It Western Region with respect to aquatic Aquatic Nuisance Species Task Force consists of 15 regular members who nuisance species; have particular knowledge and Western Panel Meeting b. Making recommendations to the experience regarding offshore AGENCY: Fish and Wildlife Service, Task Force regarding an education, technology, equipment, safety and Interior. monitoring (including inspection), training, as well as environmental ACTION: Notice of meeting. prevention, and control program to expertise in the exploration or recovery prevent the spread of the zebra mussel of offshore mineral resources. It SUMMARY: This notice announces a west of the 100th Meridian. provides advice and makes meeting of the Aquatic Nuisance c. Coordinating, where possible, other recommendations to the Assistant Species (ANS) Task Force Western aquatic nuisance species program Commandant for Marine Safety, Regional Panel. The meeting topics are activities in the Western region that are Security and Environmental Protection identified in the SUPPLEMENTARY not conducted pursuant to the regarding safety, security and INFORMATION. Nonindigenous Aquatic Nuisance rulemaking matters relating to the DATES: The Western Regional Panel will Prevention and Control Act of 1990 (as offshore mineral and energy industries. meet from 8 a.m. to 4 p.m. on amended, 1996); This advice assists the Coast Guard in Wednesday, September 8, 2004, 8 a.m. d. Developing an emergency response developing policy and regulations and to 4 p.m. on Thursday, September 9, strategy for Federal, State, and local formulating the positions of the United 2004, and 8 a.m. to 1:30 p.m. on Friday, entities for stemming new invasions of States in advance of meetings of the September 10, 2004. Minutes of the aquatic nuisance species in the region; International Maritime Organization. e. Providing advice to public and meeting will be available for public NOSAC meets twice a year, with one private individuals and entities inspection during regular business of these meetings being held at Coast concerning methods of controlling hours, Monday through Friday. Guard Headquarters in Washington, DC. aquatic nuisance species; and It may also meet for extraordinary ADDRESSES: The Western Regional Panel f. Submitting an annual report purposes. Its subcommittees and meeting will be held at the Sheraton describing activities within the Western working groups may meet to consider Anchorage Hotel, 401 East 6th Avenue, region related to aquatic nuisance specific problems as required. Anchorage, AK 99501. Phone 907–276– species prevention, research, and We will consider applications for five 8700. Minutes of the meeting will be control. positions. These positions will begin in maintained in the office of Chief, The Western Regional Panel will January, 2005. Applications should Division of Environmental Quality, U.S. discuss several topics at this meeting reach us by September 30, 2004, but we Fish and Wildlife Service, Suite 322, including: ballast water challenges, will consider applications received later 4401 North Fairfax Drive, Arlington, impact of New Zealand mud snails, if they arrive within a reasonable time Virginia 22203–1622. member updates, zebra mussels in the before we make our recommendations to FOR FURTHER INFORMATION CONTACT: Tina Missouri River, zebra mussels in the Secretary of Homeland Security. Proctor, Western Panel Coordinator and Kansas, assessing the potential To be eligible, applicants should have FWS Regional Aquatic Nuisance ecological and economic impacts of experience in one of the following Species Program Coordinator, U.S. Fish zebra mussels to Western river systems, categories: (1) Offshore drilling, (2) and Wildlife Service, P.O. Box 25486, NAISA status, status of State ANS offshore supply vessel services DFC, Denver CO, 80225, or Everett management plans, reports from other including geophysical services, (3) Wilson, U.S. Fish and Wildlife Service regional panels, the Canadian national safety and training relating to offshore at 703–358–2108. strategy to deal with the threat of activities, (4) offshore production or (5) SUPPLEMENTARY INFORMATION: Pursuant invasive species, climate change— national environmental interests. Please to section 10(a)(2) of the Federal opening up new routes and pathways, state on the application form which of Advisory Committee Act (5 U.S.C. App. northern pike impacts on native fish, an the five categories you are applying for. I), this notice announces meetings of the outreach program to aquarium owners,
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and aquatic nuisance species in Alaska. 4. How to minimize the burden of the accordance with the Paperwork There will also be reports on WRP collection of information on those who Reduction Act of 1995. The proposed projects: cross boundary Spartina are to respond, including the use of information collection is published to control and eradication, the educational appropriate automated, electronic, obtain comments from the public and material catalog on a searchable mechanical, or other forms of affected agencies. Comments are database, the joint Western Governor’s information technology. encouraged and will be accepted for Association project and the database of Title: Public perceptions of Bats in ‘‘sixty days’’ until October 12, 2004. estuarine species in California, Oregon Fort Collins, Colorado. This process is conducted in accordance and Washington. OMB Approval No.: New collection. with 5 CFR 1320.10. Dated: July 28, 2004. Abstract: The primary objective of If you have comments especially on the estimated public burden or Mamie A. Parker, this information collection is to investigate public perceptions, associated response time, suggestions, Co-Chair, Aquatic Nuisance Species Task or need a copy of the proposed Force, Assistant Director—Fisheries & Habitat knowledge, and awareness of bats and Conservation. how this could influence potential information collection instrument with instructions or additional information, [FR Doc. 04–18458 Filed 8–11–04; 8:45 am] transmission of disease (i.e., from bats to bats, bats to pets, bats to humans). A please contact Rebekah Dorr, BILLING CODE 4310–55–P random sample of Fort Collins, Department of Justice, Office of Colorado residents and a sample of Community Oriented Policing Services, DEPARTMENT OF THE INTERIOR identified residents known to have had 1100 Vermont Avenue, NW., an encounter with a bat will be asked Washington, DC 20530. Geological Survey about these bat-related issues via a Written comments and suggestions questionnaire. This information is a from the public and affected agencies Request for Public Comments on vital component for managing bats and concerning the proposed collection of Information Collection Submitted to developing effective communications information are encouraged. Your the Office of Management and Budget protocols regarding bat disease and comments should address one or more for Review Under the Paperwork ecology. This is collaborative effort of the following four points: Reduction Act involving scientists from Colorado State • Evaluate whether the proposed University (CSU), the U.S. Geological collection of information is necessary The proposed information collection Survey (USGS), and Centers for Disease for the proper performance of the described below has been submitted to Control and Prevention (CDC). functions of the agency, including the Office of Management and Budget Bureau Form No.: None. whether the information will have for approval under the provisions of the Frequency: One time. practical utility; Paperwork Reduction Act (44 U.S.C. • Description of Respondents: Residents Evaluate the accuracy of the Chapter 35). Copies of the proposed of Fort Collins, Colorado. agency’s estimate of the burden of the collection of information may be Estimated Completion Time: 20 proposed collection of information, obtained by contacting the Bureau’s minutes per respondent (approximate). including the validity of the clearance officer at the phone number Number of Respondents: 950. methodology and assumptions used; listed below. OMB has up to 60 days to • Burden hours: 317 hours. Enhance the quality, utility, and approve or disapprove the information For Additional Information Please clarity of the information to be collection but may respond after 30 Contact: Natalie Sexton, (970) 226– collected; and days; therefore, public comments • 9313, or e-mail Minimize the burden of the should be submitted to OMB within 30 [email protected]. collection of information on those who days in order to assure their maximum Bureau clearance officer: John are to respond, including through the consideration. Address your comments Cordyack (703) 648–7313. use of appropriate automated, and suggestions on the proposal by fax electronic, mechanical, or other (202) 395–6566 or e-mail Dated: June 24, 2004. technological collection techniques or ([email protected]) to the Office Byron K. Williams, other forms of information technology, of Information and Regulatory Affairs, Acting Associate Director Biology. e.g., permitting electronic submission of Office of Management and Budget, [FR Doc. 04–18405 Filed 8–11–04; 8:45 am] responses. Attention: Desk Officer for the Interior BILLING CODE 4310–Y7–M Department. Send copies of your Overview of This Information comments to the USGS Clearance Collection Officer, U.S. Geological Survey, 807 DEPARTMENT OF JUSTICE (1) Type of Information Collection: National Center, 12201 Sunrise Valley New collection. Drive, Reston, Virginia 20192, or e-mail Office of Community Oriented Policing (2) Title of the Form/Collection: ([email protected]). Services; Agency Information Department Annual Progress Report Specific public comments are Collection Activities: Proposed (DAPR). requested as to: Collection; Comments Requested (3) Agency form number, if any, and 1. Whether the collection of the applicable component of the information is necessary for the proper ACTION: 60-Day notice of information Department sponsoring the collection: performance of the functions on the collection under review: Department None. U.S. Department of Justice, Office bureaus, including whether the Annual Progress Report. of Community Oriented Policing information will have practical utility; Services. 2. The accuracy of the bureau’s The Department of Justice (DOJ), (4) Affected public who will be asked estimate of the burden of the collection Office of Community Oriented Policing or required to respond, as well as a brief of information, including the validity of Services (COPS), has submitted the abstract: Primary: Law enforcement the methodology and assumptions used; following information collection request agencies that are recipients of COPS 3. The quality, utility, and clarity of to the Office of Management and Budget hiring grants and/or COPS grants that the information to be collected; and (OMB) for review and approval in have a redeployment requirement. The
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Department Annual Progress Report was Custer Hollow Road, Clarksburg, WV the National Sex Offender Registry part of a business process reengineering 26306. poses no additional burden on the state. effort aimed at minimizing the reporting Written comments and suggestions The telecommunication network used burden on COPS grantees by from the public and affected agencies for the transmission of NSOR data is an streamlining the collection of progress concerning the proposed collection of existing network, and the FBI assumes report and COPS Count information into information are encouraged. Your all costs. one annual report. comments should address one or more (6) An estimate of the total public (5) An estimate of the total number of of the following four points: burden (in hours) associated with the respondents and the amount of time • Evaluate whether the proposed collection: The estimated total annual estimated for an average respondent to collection of information is necessary burden hour associated with this respond/reply: It is estimated that 9,000 for the proper performance of the collection is 1 to allow OMB approval. respondents annually will complete the functions of the agency, including FOR FURTHER INFORMATION CONTACT: form within 1 hour. whether the information will have Brenda E. Dyer, Clearance Officer, (6) An estimate of the total public practical utility; • United States Department of Justice, burden (in hours) associated with the Evaluate the accuracy of the Justice Management Division, Policy collection: There are an estimated 9,000 agencies estimate of the burden of the and Planning Staff, Patrick Henry total annual burden hours associated proposed collection of information, Building, Suite 1600, 601 D Street, NW., with this collection. including the validity of the Washington, DC 20530. If additional information is required methodology and assumptions used; contact: Brenda E. Dyer, Clearance • Enhance the quality, utility, and Dated: August 6, 2004. Officer, United States Department of clarity of the information to be Brenda E. Dyer, Justice, Justice Management Division, collected; and Clearance Officer, Department of Justice. Policy and Planning Staff, Patrick Henry • Minimize the burden of the [FR Doc. 04–18426 Filed 8–11–04; 8:45 am] Building, Suite 1600, 601 D Street, NW., collection of information on those who BILLING CODE 4410–02–P Washington, DC 20530. are to respond, including through the use of appropriate automated, Dated: August 6, 2004. electronic, mechanical, or other DEPARTMENT OF LABOR Brenda E. Dyer, technological collection techniques or Clearance Officer, Department of Justice. other forms of information technology, Office of the Secretary [FR Doc. 04–18425 Filed 8–11–04; 8:45 am] e.g., permitting electronic submission of BILLING CODE 4410–AT–P responses. Submission for OMB Review; Overview of this information Comment Request collection: DEPARTMENT OF JUSTICE (1) Type of Information Collection: July 28, 2004. Extension of a currently approved The Department of Labor (DOL) has Federal Bureau of Investigation collection. submitted the following public (2) Title of the Form/Collection: information collection request (ICR) to Agency Information Collection the Office of Management and Budget Activities: Proposed Collection; National Sex Offender Registry. (3) Agency form number, if any, and (OMB) for review and approval in Comments Requested the applicable component of the accordance with the Paperwork ACTION: 60-day notice of information Department of Justice sponsoring the Reduction Act of 1995 (Pub. L. 104–13, collection under review: National Sex collection: Form Number: none. Federal 44 U.S.C. Chapter 35). A copy of each Offender Registry. Bureau of Investigation (FBI). ICR, with applicable supporting (4) Affected public who will be asked documentation, may be obtained by The Department of Justice (DOJ), or required to respond, as well as a brief contacting the Department of Labor Federal Bureau of Investigation, has abstract: Primary: State, local, or tribal (DOL). To obtain documentation, submitted the following information government. The National Sex Offender contact Ira Mills on (202) 693–4122 (this collection request to the Office of Registry data is collection from the 50 is not a toll-free number) or e-mail: Management and Budget (OMB) for States, 5 Territories, and the District of [email protected]. review and approval in accordance with Columbia. The registry was established Comments should be sent to Office of the Paperwork Reduction Act of 1995. by the FBI in accordance with Federal Information and Regulatory Affairs, The proposed information collection is Law (42 U.S.C. 14072) in order to track Attn: OMB Desk Officer for DOL, Office published to obtain comments from the the whereabouts and movements of of Management and Budget, Room public and affected agencies. Comments persons who have been convicted of a 10235, Washington, DC 20503 (202) are encouraged and will be accepted for criminal offense against a victim who is 395–7316 (this is not a toll-free ‘‘sixty days’’ until October 12, 2004. a minor; persons who have been number), within 30 days from the date This process is conducted in accordance convicted of a sexually violent offense; of this publication in the Federal with 5 CFR 1320.10. and persons who are sexually violent Register. If you have comments especially on predators. The OMB is particularly interested in the estimated public burden or (5) An estimate of the total number of comments which: associated response time, suggestions, respondents and the amount of time • Evaluate whether the proposed or need a copy of the proposed estimated for an average respondent to collection of information is necessary information collection instrument with respond: The estimated number of for the proper performance of the instructions or additional information, respondents is 56 government entities. functions of the agency, including please contact Venetia A. King, Criminal The estimated time for the average whether the information will have Information and Transition Unit, respondent to respond: The collection of practical utility; Program Development Section, Criminal information from the sex offender is • Evaluate the accuracy of the Justice Information Services Division, sponsored by the state government. The agency’s estimate of the burden of the Federal Bureau of Investigation, 1000 subsequent electronic transmission into proposed collection of information,
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including the validity of the NUCLEAR REGULATORY administrative judges in accordance methodology and assumptions used; COMMISSION with 10 CFR 2.302. • Enhance the quality, utility, and [Docket No. 52–008–ESP; ASLBP No. 04– Issued at Rockville, Maryland this 6th day clarity of the information to be 822–02–ESP] of August 2004. collected; and G. Paul Bollwerk, III, Dominion Nuclear North Anna, LLC • Minimize the burden of the Chief Administrative Judge, Atomic Safety (Early Site Permit for North Anna ESP and Licensing Board Panel. collection of information on those who Site); Notice of Reconstitution are to respond, including through the [FR Doc. 04–18432 Filed 8–11–04; 8:45 am] use of appropriate automated, Pursuant to 10 CFR 2.321, the Atomic BILLING CODE 7590–01–P electronic, mechanical, or other Safety and Licensing Board in the above technological collection techniques or captioned proceeding is hereby reconstituted by appointing the NUCLEAR REGULATORY other forms of information technology, COMMISSION e.g., permitting electronic submission of following Administrative Judges: Alex S. Karlin, Chair, Atomic Safety and responses. [Docket Nos. 50–348 and 50–364] Licensing Board Panel, U.S. Nuclear Agency: Employment and Training Regulatory Commission, Washington, Southern Nuclear Operating Company, Administration. DC 20555–0001. Inc, Joseph M. Farley Nuclear Power Type of Review: Extension of a Dr. Thomas S. Elleman, Atomic Safety Plant, Units 1 and 2; Notice of currently approved collection. and Licensing Board Panel, U.S. Availability of the Draft Supplement 18 Nuclear Regulatory Commission, to Generic Environmental Impact Title: Planning Guidance and Washington, DC 20555–0001. Statement and Public Meeting for the Instructions for Submission of the Dr. Richard F. Cole, Atomic Safety and License Renewal of Joseph M. Farley Strategic Five Year State Plan and Plan Licensing Board Panel, U.S. Nuclear Nuclear Power Plant, Units 1 and 2 Modifications for Title I of the Regulatory Commission, Washington, Workforce Investment Act of 1998 and DC 20555–0001. Notice is hereby given that the U.S. the Wagner Payser Act. All correspondence, documents, and Nuclear Regulatory Commission (NRC, OMB Number: 1205–0398. other materials shall be filed with the the Commission) has published a draft administrative judges in accordance plant-specific supplement to the Frequency: On occasion. with 10 CFR 2.302. Generic Environmental Impact Statement (GEIS), NUREG–1437, Affected Public: State, local, or tribal Issued at Rockville, Maryland this 6th day government. of August 2004. regarding the renewal of operating licenses NPF–2 and NPF–8 for an Number of Respondents: 59. G. Paul Bollwerk, III, additional 20 years of operation at Number of Annual Responses: 59. Chief Administrative Judge, Atomic Safety and Licensing Board Panel. Joseph M. Farley Nuclear Power Plant Estimated Time per Response: 25 (FNP). FNP is located in Houston [FR Doc. 04–18431 Filed 8–11–04; 8:45 am] hours. County, Alabama, approximately 16.5 BILLING CODE 7590–01–P Burden Hours Total: 1475. miles east of the City of Dothan, Alabama. Possible alternatives to the Total Annualized Capital/Startup proposed action (license renewal) Costs: $0. NUCLEAR REGULATORY COMMISSION include no action and reasonable Total Annual Costs (operating/ alternative energy sources. maintaining systems or purchasing [Docket No. 52–007–ESP; ASLBP No. 04– The draft Supplement to the GEIS is 821–01–ESP] services): $0. available for public inspection in the NRC Public Document Room (PDR) Description: The Workforce Exelon Generation Company, LLC, located at One White Flint North, 11555 Investment Act of 1998 (Public Law (Early Site Permit for Clinton ESP Site); Notice of Reconstitution Rockville Pike (first floor), Rockville, 105–220) provides the framework for a Maryland 20852, or from the Publicly network of State workforce investment Pursuant to 10 CFR 2.321, the Atomic Available Records (PARS) component of systems designed to meet the needs of Safety and Licensing Board in the above NRC’s Agencywide Documents Access the nation’s businesses, job seekers, captioned proceeding is hereby and Management System (ADAMS). youth, and those who want to further reconstituted by appointing the ADAMS is accessible from the NRC Web their careers. Title I requires that States following Administrative Judges: site at http://www.nrc.gov/reading-rm/ develop five-year strategic plans for this Dr. Paul B. Abramson, Chair, Atomic adams.html (the Public Electronic system, which must also contain the Safety and Licensing Board Panel, Reading Room). Persons who do not detail plans required under the Wagner- U.S. Nuclear Regulatory have access to ADAMS, or who Peyser Act (29 U.S.C. 49g). The Act also Commission,Washington, DC 20555– encounter problems in accessing the requires States to request new Plans (if 0001. documents located in ADAMS, should expiring) and modifications to these Dr. Anthony J. Baratta, Atomic Safety contact the PDR reference staff at Plans as outlined by WIA and Licensing Board Panel, U.S. 1 (800) 397–4209, (301) 415–4737, or by (20CFR661.230) or the Wagner-Peyser Nuclear Regulatory e-mail to [email protected]. In addition, the Act (20 CFR 652.212–214). Commission,Washington, DC 20555– Houston Love Memorial Library, 212 0001. West Burdeshaw Street, Dothan, Ira L. Mills, Dr. David L. Hetrick, Atomic Safety and Alabama and the Lucy Maddox Departmental Clearance Officer. Licensing Board Panel, U.S. Nuclear Memorial Library, 11880 Columbia [FR Doc. 04–18442 Filed 8–11–04; 8:45 am] Regulatory Commission,Washington, Street, Blakely, Georgia, have agreed to BILLING CODE 4510–30–P DC 20555–0001. make the draft plant-specific All correspondence, documents, and supplement to the GEIS available for other materials shall be filed with the public inspection.
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Any interested party may submit Members of the public may also register and actions, as appropriate, for comments on the draft supplement to to provide oral comments within 15 deliberation by the full Committee. the GEIS for consideration by the NRC minutes of the start of each session. Members of the public desiring to staff. To be certain of consideration, Individual, oral comments may be provide oral statements and/or written comments on the draft supplement to limited by the time available, depending comments should notify the Designated the GEIS and the proposed action must on the number of persons who register. Federal Official, Mr. Sam Duraiswamy be received by November 5, 2004. If special equipment or accommodations (telephone: (301) 415–7364) between Comments received after the due date are needed to attend or present 7:30 a.m. and 4:15 p.m. (ET) five days will be considered if it is practical to do information at the public meeting, the prior to the meeting, if possible, so that so, but the NRC staff is able to assure need should be brought to Mr. Cushing’s appropriate arrangements can be made. consideration only for comments attention no later than September 24, Electronic recordings will be permitted received on or before this date. Written 2004, to provide the NRC staff adequate only during those portions of the comments on the draft supplement to notice to determine whether the request meeting that are open to the public. the GEIS should be sent to: Chief, Rules can be accommodated. Further information regarding this and Directives Branch, Division of meeting can be obtained by contacting FOR FURTHER INFORMATION CONTACT: Jack the Designated Federal Official between Administrative Services, Office of Cushing, License Renewal and 7:30 a.m. and 4:15 p.m. (ET). Persons Administration, Mailstop T–6D59, U.S. Environmental Impacts Program, planning to attend this meeting are Nuclear Regulatory Commission, Division of Regulatory Improvement Washington, DC 20555–0001. urged to contact the above named Programs, U.S. Nuclear Regulatory Comments may be hand-delivered to individual at least two working days Commission, Washington, DC 20555– the NRC at 11545 Rockville Pike, Room prior to the meeting to be advised of any 0001. Mr. Cushing may be contacted at T–6D59, Rockville, Maryland, between potential changes in the agenda. 7:30 a.m. and 4:15 p.m. on Federal the aforementioned telephone number or e-mail address. Dated August 6, 2004. workdays. Electronic comments may be Michael R. Snodderly, submitted to the NRC by e-mail at Dated at Rockville, Maryland, this 6th day of August, 2004. Acting Associate Director for Technical [email protected]. All comments Support, ACRS/ACNW. received by the Commission, including For the Nuclear Regulatory Commission. [FR Doc. 04–18433 Filed 8–11–04; 8:45 am] those made by Federal, State, and local Pao-Tsin Kuo, BILLING CODE 7590–01–P agencies, Native American Tribes, or Program Director, License Renewal and other interested persons, will be made Environmental Impacts Program, Division of available electronically at the Regulatory Improvement Programs, Office of NUCLEAR REGULATORY Commission’s PDR in Rockville, Nuclear Reactor Regulation. COMMISSION Maryland, and from the PARS [FR Doc. 04–18435 Filed 8–11–04; 8:45 am] component of ADAMS. BILLING CODE 7590–01–P Advisory Committee on Reactor The NRC staff will hold a public Safeguards, Subcommittee Meeting on meeting to present an overview of the Safeguards and Security; Postponed draft plant-specific supplement to the NUCLEAR REGULATORY GEIS and to accept public comments on COMMISSION The ACRS Subcommittee on the document. The public meeting will Safeguards and Security scheduled for be held on September 30, 2004, at the Advisory Committee on Reactor August 24–26, 2004, at Sandia National Quality Inn, 3053 Ross Clark Circle, Safeguards, Subcommittee Meeting on Laboratories, Albuquerque, New Mexico Dothan, Alabama. There will be two Planning and Procedures; Notice of has been postponed. The meeting will sessions to accommodate interested Meeting be rescheduled at a future date when the parties. The first session will commence work that was scheduled for discussion at 1:30 p.m. and will continue until 4:30 The ACRS Subcommittee on Planning has been completed. Notice of this p.m. The second session will commence and Procedures will hold a meeting on meeting was published in the Federal at 7 p.m. and will continue until 10 p.m. September 8, 2004, Room T–2B1, 11545 Register on Monday, July 26, 2004 (69 Both meetings will be transcribed and Rockville Pike, Rockville, Maryland. FR 44553). will include: (1) A presentation of the The entire meeting will be open to For further information contact: Dr. contents of the draft plant-specific public attendance, with the exception of Richard P. Savio (telephone: (301) 415– supplement to the GEIS, and (2) the a portion that may be closed pursuant 7362) or Mr. Richard K. Major opportunity for interested government to 5 U.S.C. 552b(c)(2) and (6) to discuss (telephone: (301) 415–7366) between agencies, organizations, and individuals organizational and personnel matters 7:30 a.m. and 4:15 p.m. (ET). that relate solely to the internal to provide comments on the draft report. Dated: August 6, 2004. personnel rules and practices of the Additionally, the NRC staff will host Michael R. Snodderly, informal discussions one hour prior to ACRS, and information the release of which would constitute a clearly Acting Associate Director for Technical the start of each session at the same Support, ACRS/ACNW. location. No comments on the draft unwarranted invasion of personal [FR Doc. 04–18434 Filed 8–11–04; 8:45 am] supplement to the GEIS will be accepted privacy. during the informal discussions. To be The agenda for the subject meeting BILLING CODE 7590–01–P considered, comments must be provided shall be as follows: either at the transcribed public meeting Wednesday, September 8, 2004—9:30 or in writing, as discussed below. SECURITIES AND EXCHANGE a.m.–11:30 a.m. Persons may pre-register to attend or COMMISSION present oral comments at the meeting by The Subcommittee will discuss Sunshine Act Meeting contacting Mr. Jack Cushing be proposed ACRS activities and related telephone at 1 (800) 368–5642, extension matters. The Subcommittee will gather Notice is hereby given, pursuant to 1424, or by e-mail at [email protected] information, analyze relevant issues and the provisions of the Government in the no later than September 24, 2004. facts, and formulate proposed positions Sunshine Act, Pub. L. 94–409, that the
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Securities and Exchange Commission in reports on Form N CSR), including 23, 2004, OPRA submitted Amendment will hold the following meetings during other accounts they manage, No. 1 to the proposal.4 The proposed the week of August 16, 2004: compensation structure, and ownership amendment would eliminate from the Closed Meetings will be held on of securities in the fund. For further OPRA Plan references to the fee Tuesday, August 17, 2004 at 2 p.m. and information, please contact Sanjay exemption pilot that expired on May 31, Thursday, August 19, 2004 at 2 p.m. Lamba at (202) 942–7926. 2004. Notice of the proposal, as An Open Meeting will be held on The subject matter of the Closed modified by Amendment No. 1, was Wednesday, August 18, 2004 at 10 a.m., Meeting scheduled for Thursday, published in the Federal Register on in Room 1C30, the William O. Douglas August 19, 2004 will be: July 8, 2004.5 The Commission received Meeting Room. Formal orders of investigations; no comment letters on the proposed Institution and settlement of Commissioners, Counsel to the OPRA Plan amendment. This order injunctive actions; Commissioners, the Secretary to the approves the proposal, as amended. Institution and settlement of The purpose of the proposed OPRA Commission, and recording secretaries administrative proceedings of an Plan amendment is to eliminate will attend the Closed Meetings. Certain enforcement nature; references to the fee exemption pilot in staff members who have an interest in Amicus consideration; and section VII(d)(vi) of the OPRA Plan that the matters may also be present. Regulatory matter regarding financial provided a temporary exemption from The General Counsel of the institutions. OPRA fees for members of exchanges Commission, or his designee, has At times, changes in Commission that were parties to the OPRA Plan and certified that, in his opinion, one or priorities require alterations in the that acted as brokers or dealers on more of the exemptions set forth in 5 scheduling of meeting items. For further traditional exchange trading floors or as U.S.C. 552b(c)(3), (5), (7), (9)(B), and information and to ascertain what, if specialists or market makers on (10) and 17 CFR 200.402(a)(3), (5), (7), any, matters have been added, deleted electronic exchanges or electronic 9(ii) and (10), permit consideration of or postponed, please contact: the Office facilities of exchanges. OPRA also the scheduled matters at the Closed of the Secretary at (202) 942–7070. proposes to eliminate section V(e) of the Meetings. OPRA Plan, which provided that parties Commissioner Goldschmid, as duty August 10, 2004. Jonathan G. Katz, to the OPRA Plan could access OPRA officer, voted to consider the items information on their trading floors or at Secretary. listed for the closed meetings in closed their other business locations without sessions. [FR Doc. 04–18529 Filed 8–10–04; 12:11 pm] being obligated to pay fees to OPRA. The subject matter of the Closed BILLING CODE 8010–01–P OPRA states that the effect of the Meeting scheduled for Tuesday, August proposed amendment would be to make 17, 2004 will be: all devices that are used to access Formal orders of investigations; SECURITIES AND EXCHANGE options market information furnished Institution and settlement of COMMISSION by OPRA subject to OPRA’s information injunctive actions; [Release No. 34–50147; File No. SR–OPRA– fees. Institution and settlement of 2004–02] OPRA also proposes to amend the administrative proceedings of an definitions of ‘‘vendor’’ and enforcement nature; and Options Price Reporting Authority; ‘‘subscriber’’ set forth in paragraphs (k) Adjudicatory matters. Order Approving an Amendment to the and (l) of section II of the OPRA Plan The subject matter of the Open Plan for Reporting of Consolidated to confirm that the receipt of options Meeting scheduled for Wednesday, Options Last Sale Reports and market data by an exchange over August 18, 2004 will be: Quotation Information and Amendment devices maintained by such exchange at 1. The Commission will consider No. 1 Thereto To Eliminate From the its business locations would not involve whether to adopt amendments to rule Plan References to the Fee Exemption redistribution of the data by such 12b–1 under the Investment Company Pilot Currently Provided for in the Plan exchange, notwithstanding that Act of 1940. The amended rule would members of such exchange could be prohibit investment companies from August 4, 2004. able to access the information over those paying for the distribution of their On May 7, 2004, the Options Price devices. Finally, as a matter of shares with brokerage commissions. For Reporting Authority (‘‘OPRA’’) ‘‘housekeeping,’’ OPRA proposes to further information, please contact submitted to the Securities and delete from section V(c)(i) of the OPRA William Middlebrooks at (202) 942– Exchange Commission (‘‘Commission’’), Plan language concerning the 0690. pursuant to section 11A of the introduction of OPRA’s BBO Service in 2. The Commission will consider Securities Exchange Act of 1934 2003 since the BBO Service is now in 1 whether to adopt amendments to Forms (‘‘Act’’) and Rule 11Aa3–2 place. N–1A, N–2, N–3, and N–CSR that are thereunder,2 an amendment to the Plan After careful review, the Commission designed to improve the disclosure for Reporting of Consolidated Options finds that the proposed OPRA Plan provided by mutual funds and closed- Last Sale Reports and Quotation amendment is consistent with the end funds about their portfolio Information (‘‘OPRA Plan’’).3 On June managers. The amendments would are the American Stock Exchange LLC, the Boston extend the existing requirement that a 1 15 U.S.C. 78k-1. Stock Exchange, Inc., the Chicago Board Options 2 fund provide basic information in its 17 CFR 240.11Aa3–2. Exchange, Inc., the International Securities 3 The OPRA Plan is a national market system plan Exchange, Inc., the Pacific Exchange, Inc., and the prospectus regarding its portfolio approved by the Commission pursuant to section Philadelphia Stock Exchange, Inc. manager to members of management 11A of the Act and Rule 11Aa3–2 thereunder. See 4 See letter from Michael L. Meyer, Counsel to teams. The amendments would also Securities Exchange Act Release No. 17638 (March OPRA, Schiff Hardin LLP, to Deborah Flynn, require a fund to disclose additional 18, 1981), 22 S.E.C. Docket 484 (March 31, 1981). Assistant Director, Division of Market Regulation, The OPRA Plan provides for the collection and Commission, dated June 22, 2004, replacing in its information about its portfolio managers dissemination of last sale and quotation information entirety the initial proposal filed on May 7, 2004. in its Statement of Additional on options that are traded on the participant 5 See Securities Exchange Act Release No. 49958 Information (and, for closed-end funds, exchanges. The six participants to the OPRA Plan (July 1, 2004), 69 FR 41312.
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requirements of the Act and the rules SECURITIES AND EXCHANGE language contained in corresponding and regulations thereunder.6 The COMMISSION existing rules relating to listed Commission believes that the proposed securities. For example, the BEACON [Release No. 34–50154; File No. SR–BSE– Remote trading program requirements OPRA Plan amendment is consistent 2003–09] with section 11A of the Act 7 and Rule currently applicable to the trading of 11Aa3–2 thereunder 8 in that it is Self-Regulatory Organizations; Boston listed securities, including the appropriate in the public interest, for Stock Exchange, Inc.; Order Approving applicability of other BSE Rules, the protection of investors and the Proposed Rule Change and confidentiality, ‘‘Chinese Walls,’’ maintenance of fair and orderly markets, Amendment Nos. 1 and 2 Thereto communications, and Electronic to remove impediments to, and perfect Relating to the Extension of Certain Trading Permits (‘‘ETPs’’), would apply with respect to the remote trading of the mechanisms of, a national market Listed Trading Rules to the Trading of Nasdaq Securities Nasdaq securities. system. The Commission notes that the Specifically, given the expiration of August 5, 2004. Exchange has represented that, as with the fee exemption pilot for accessing On July 2, 2003, the Boston Stock current BEACON Remote locations, the OPRA information, the Commission Exchange, Inc. (‘‘BSE’’ or ‘‘Exchange’’) Exchange’s Compliance Department will finds that it is appropriate to eliminate filed with the Securities and Exchange physically inspect each remote Nasdaq any references within the OPRA Plan to Commission (‘‘Commission’’), pursuant location. Likewise, the proposed rule such fee exemption so as to avoid to Section 19(b)(1) of the Securities change includes ETP provisions that confusion. Moreover, the Commission Exchange Act of 1934 (‘‘Act’’) 1 and Rule require, among other things, that all believes that subjecting all devices used 19b–4 thereunder,2 a proposed rule registered specialists and clerks to access OPRA information, whether change to extend certain of its listed complete a floor-training program, on-floor or off-floor, to OPRA’s trading rules to the trading of Nasdaq unless waived under certain exceptional circumstances, as well as successfully information fees should help to ensure securities. On April 5, 2004, the complete the BSE floor examination and that the various participants do not Exchange amended the proposed rule 3 the Series 63 (NASAA Uniform State receive disparate treatment under the change. On May 6, 2004, the Exchange amended the proposed rule change.4 Law Exam).7 In addition, each registered OPRA Plan. The Commission also clerk in a remote location who qualifies believes that OPRA’s proposed The proposed rule change was published for comment in the Federal for an ETP would be required to operate amendments to the definitions of 5 under the direct supervision of a ‘‘vendor’’ and ‘‘subscriber’’ and the Register on June 7, 2004. The Commission received no comments on registered specialist at such remote deletion of language concerning the the proposal. This order approves the location, just as a registered clerk is introduction of its BBO Service should proposed rule change, as amended. supervised in the on-floor environment. promote clarity within the language of The proposed rule change would add The Commission finds that the the OPRA Plan. two new sections to the BSE’s Rules proposed rule change is consistent with It is therefore ordered, pursuant to relating to the trading of Nasdaq the requirements of the Act and the section 11a of the Act,9 and Rule securities on the Exchange. The first rules and regulations thereunder 11Aa3–2 thereunder,10 that the proposed new section, ‘‘Section 30. applicable to a national securities exchange.8 The Commission believes proposed OPRA Plan amendment (SR- Competing Specialist Initiative,’’ would that the proposed rule change is OPRA–2004–02), as modified by permit specialists who trade Nasdaq consistent with Section 6(b) of the Act,9 Amendment No. 1, be, and it hereby is, securities on the BSE to avail in general, and furthers the objectives of approved. themselves of the Exchange’s competing 10 specialist program. The second Section 6(b)(5), in particular, in that it For the Commission, by the Division of proposed new section, ‘‘Section 31. is designed to prevent fraudulent and Market Regulation, pursuant to delegated Remote Trading in Nasdaq Securities,’’ manipulative acts and practices, to authority.11 would extend the BSE’s BEACON promote just and equitable principles of Margaret H. McFarland, Remote trading program to include trade, to foster cooperation and Deputy Secretary. Nasdaq trading.6 In both cases, the coordination with persons engaged in [FR Doc. 04–18421 Filed 8–11–04; 8:45 am] proposed new rules would track the regulating, clearing, settling, processing information with respect to, and BILLING CODE 8010–01–P 1 15 U.S.C. 78s(b)(1). facilitating transactions in securities, to 2 17 CFR 240.19b–4. remove impediments to and perfect the 3 See letter from John Boese, Vice President, Legal mechanism of a free and open market and Compliance, Exchange, to Nancy Sanow, and a national market system, and in Assistant Director, Division of Market Regulation general, to protect investors and the (‘‘Division’’), Commission, dated April 2, 2004 (‘‘Amendment No. 1’’). In Amendment No. 1, the public interest. Specifically, the Exchange restated the proposed rule change in its entirety. 7 According to the BSE, the on-site floor training 4 See letter from John Boese, Chief Regulatory includes, among other things: Communication Officer, Exchange, to Nancy Sanow, Assistant procedures with Front Desk Operations, Director, Division, Commission, dated May 5, 2004 Surveillance, Systems Support; Competing 6 In approving this proposed OPRA Plan (‘‘Amendment No. 2’’). In Amendment No. 2, the Specialist Initiative and Unlisted Trading Privilege amendment, the Commission has considered its Exchange restated the proposed rule change in its applications and procedures; stock allocation impact on efficiency, competition, and capital entirety. procedures; trading halt procedures; and formation. 15 U.S.C. 78c(f). 5 See Securities Exchange Act Release No. 49771 availability of books and records. 8 7 15 U.S.C. 78k-1. (May 25, 2004), 69 FR 31851. In approving this proposed rule change, the 6 Commission has considered the proposed rule’s 8 17 CFR 240.11Aa3–2. The BSE’s BEACON Remote trading system was approved by the Commission on August 8, 2000. impact on efficiency, competition, and capital 9 15 U.S.C. 78k-1. See Securities Exchange Act Release No. 43127 formation. 15 U.S.C. 78c(f). 10 17 CFR 240.11Aa3–2. (August 8, 2000), 65 FR 49617 (August 14, 2000) 9 15 U.S.C. 78f(b). 11 17 CFR 200.30–3(29). (SR–BSE–99–1). 10 15 U.S.C. 78f(b)(5).
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Exchange’s proposal permits BSE I. Self-Regulatory Organization’s NASD IM–6130 with respect to members who trade Nasdaq securities to Statement of the Terms of Substance of securities eligible to be quoted on the trade from a remote location subject to the Proposed Rule Change OTCBB or in other non-Nasdaq equity 7 the same requirements and surveillance Nasdaq proposes to extend, for certain securities. In response to such that are currently in place with respect securities, the operative date of NASD comments, Nasdaq proposes to allow to remote trading of listed securities. IM–6130 (‘‘Trade Reporting of Short firms, with respect to OTCBB and non- For the foregoing reasons, the Sales’’) regarding members’’ obligations Nasdaq equity securities, an additional Commission finds that the proposed to indicate on their transaction reports 60-day period to re-program their rule change is consistent with the whether a sale is a short sale or a short systems in order to comply with NASD requirements of the Act and rules and sale exempt transaction. Specifically, IM–6130. Therefore, the operative date regulations thereunder. Nasdaq proposes to extend the operative for compliance with NASD IM–6130 will remain July 26, 2004 for all Nasdaq It is therefore ordered, pursuant to date to September 26, 2004, with respect National Market, SmallCap, and Section 19(b)(2) of the Act,11 that the to securities eligible to be quoted on the Over the Counter Bulletin Board exchange-listed securities and the proposed rule change, as amended (SR– operative date for OTCBB and non- BSE–2003–09), is approved. (‘‘OTCBB’’) or other non-Nasdaq equity securities. No changes to the text of the Nasdaq equity securities will be For the Commission, by the Division of NASD rules are required by this extended to September 24, 2004. Market Regulation, pursuant to delegated proposed rule change. NASD will publish a Notice to authority.12 Members announcing the new operative Margaret H. McFarland, II. Self-Regulatory Organization’s date for compliance with NASD IM– Deputy Secretary. Statement of the Purpose of, and 6130 for OTCBB and non-Nasdaq [FR Doc. 04–18423 Filed 8–11–04; 8:45 am] Statutory Basis for, the Proposed Rule securities. Change BILLING CODE 8010–01–P 2. Statutory Basis In its filing with the Commission, Nasdaq included statements concerning Nasdaq believes that the proposed SECURITIES AND EXCHANGE rule change is consistent with the the purpose of and basis for the 8 COMMISSION proposed rule change, and discussed provisions of Section 15A of the Act, in general and with Section 15A(b)(6) of any comments it received on the the Act,9 in particular, in that it is [Release No. 34–50158; File No. SR–NASD– proposed rule change. The text of these designed to prevent fraudulent and 2004–117] statements may be examined at the manipulative acts and practices, to places specified in Item IV below. promote just and equitable principles of Self-Regulatory Organizations; Nasdaq has prepared summaries, set trade, and, in general, to protect National Association of Securities forth in Sections A, B, and C below, of investors and the public interest. Dealers, Inc.; Notice of Filing and the most significant aspects of such Nasdaq believes the proposed rule Immediate Effectiveness of a Proposed statements. Rule Change Extending the Operative change is consistent with the Act in that Date for the Short-Sale ACT Reporting A. Self-Regulatory Organization’s it clarifies short sale reporting Requirements for Certain Securities Statement of the Purpose of, and requirements and promotes compliance Statutory Basis for, the Proposed Rule with and regulation of short sale August 5, 2004. Change requirements. Pursuant to Section 19(b)(1) of the 1. Purpose B. Self-Regulatory Organization’s Securities Exchange Act of 1934 Statement on Burden on Competition (‘‘Act’’)1 and Rule 19b–4 thereunder,2 On May 20, 2004, Nasdaq filed a notice is hereby given that on August 2, proposed rule change that established Nasdaq does not believe that the 2004, the National Association of NASD IM–6130 regarding members’ proposed rule change will result in any burden on competition that is not Securities Dealers, Inc. (‘‘NASD’’ or obligations to indicate on their necessary or appropriate in furtherance ‘‘Association’’), through its subsidiary, transaction reports whether a of the purposes of the Act. The Nasdaq Stock Market, Inc. transaction was a short sale or short 5 (‘‘Nasdaq’’), filed with the Securities exempt. That proposed rule change C. Self-Regulatory Organization’s and Exchange Commission was immediately effective, but Nasdaq Statement on Comments on the (‘‘Commission’’) the proposed rule delayed its operative date for sixty days, Proposed Rule Change Received From change as described in Items I, II, and until July 26, 2004, to allow members Members, Participants or Others III below, which Items have been adequate time to comply with their obligations. Written comments were neither prepared by Nasdaq. Nasdaq has filed solicited nor received. this proposed rule change pursuant to Based upon feedback received in a comment letter 6 and from the staff of Section 19(b)(3)(A)(i) of the Act 3 and III. Date of Effectiveness of the the Division of Market Regulation of the Rule 19b–4(f)(1) thereunder,4 which Proposed Rule Change and Timing for renders the proposal effective upon Commission, Nasdaq has determined to Commission Action extend the operative date for NASD IM– filing with the Commission. The The foregoing rule change has become 6130 for an additional sixty days with Commission is publishing this notice to effective pursuant to Section respect to certain stocks. Specifically, a solicit comments on the proposed rule 19(b)(3)(A)(i) of the Act,10 and Rule commenter stated that it will be unable change from interested persons. 19b–4(f)(1) thereunder,11 because it to comply with its obligations under constitutes a stated practice with respect 11 15 U.S.C. 78s(b)(2). 5 See Securities Exchange Act Release No. 49833 12 7 17 CFR 200.30–3(a)(12). (June 8, 2004) 69 FR 33969 (June 17, 2004). Id. 1 8 15 U.S.C. 78s(b)(1). 6 Letter from R. Cromwell Coulson, Chief 15 U.S.C. 78o–3. 2 17 CFR 240.19b–4. Executive Officer, Pink Sheets LLC, to Jonathan G. 9 15 U.S.C. 78o–3(b)(6). 3 15 U.S.C. 78s(b)(3)(A)(ii). Katz, Secretary, Commission, dated June 24, 2004 10 15 U.S.C. 78s(b)(3)(A)(i). 4 17 CFR 240.19b–4(f)(6). (‘‘Pink Sheets Letter’’). 11 17 CFR 240.19b–4(f)(1).
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to the enforcement of an existing NASD submissions should refer to File italics. Proposed deletions are in rule. Number SR–NASD–2004–117 and [brackets]. At any time within 60 days of the should be submitted on or before SCHEDULE A TO NASD BY-LAWS filing of the proposed rule change, September 2, 2004. pursuant to Section 19(b)(3)(A) of the For the Commission, by the Division of Section 4—Fees Act,12 the Commission may summarily Market Regulation, pursuant to delegated (a) through (l) No change. abrogate the proposed rule change if it authority.13 (m) There shall be a session fee of appears to the Commission that such Margaret H. McFarland, [$65.00] $60.00 assessed as to each action is necessary or appropriate in the individual who is required to complete public interest, for the protection of Deputy Secretary. the Regulatory Element of the investors, or otherwise in furtherance of [FR Doc. 04–18414 Filed 8–11–04; 8:45 am] Continuing Education Requirements the purposes of the Act. BILLING CODE 8010–01–P pursuant to Rule 1120. IV. Solicitation of Comments (n) through (o) No change. Interested persons are invited to SECURITIES AND EXCHANGE II. Self-Regulatory Organization’s submit written data, views, and COMMISSION Statement of the Purpose of, and arguments concerning the proposed rule Statutory Basis for, the Proposed Rule change. Comments may be submitted by [Release No. 34–50144; File No. SR–NASD– Change any of the following methods: 2004–115] In its filing with the Commission, Electronic Comments Self-Regulatory Organizations; NASD included statements concerning • Use the Commission’s Internet National Association of Securities the purpose of and basis for the comment form (http://www.sec.gov/ Dealers, Inc.; Notice of Filing and proposed rule change and discussed any rules/sro.shtml); or Order Granting Accelerated Approval comments it had received on the • Send an e-mail to rule- of Proposed Rule Change Relating to proposed rule change. The text of these [email protected]. Please include File Amendments To Reduce the Fee for statements may be examined at the Number SR–NASD–2004–117 on the the Regulatory Element of the places specified in Item III below. NASD subject line. Continuing Education Program has prepared summaries, set forth in Sections A, B, and C below, of the most Paper Comments August 4, 2004 significant aspects of such statements. • Send paper comments in triplicate Pursuant to Section 19(b)(1) of the A. Self-Regulatory Organization’s to Jonathan G. Katz, Secretary, Securities Exchange Act of 1934 Statement of the Purpose of, and Securities and Exchange Commission, (‘‘Act’’)1 and Rule 19b–4 thereunder,2 Statutory Basis for, the Proposed Rule 450 Fifth Street, NW., Washington, DC notice is hereby given that on July 27, Change 20549–0609. 2004 the National Association of All submissions should refer to File Securities Dealers, Inc. (‘‘NASD’’) filed 1. Purpose Number SR–NASD–2004–117. This file with the Securities and Exchange The Regulatory Element, a computer- number should be included on the Commission (‘‘Commission’’) the based education program administered subject line if e-mail is used. To help the proposed rule change as described in by NASD to help ensure that registered Commission process and review your Items I and II below, which Items have persons are kept up-to-date on comments more efficiently, please use been prepared by NASD. The regulatory, compliance, and sales only one method. The Commission will Commission is publishing this notice to practice matters in the industry, is a post all comments on the Commission’s solicit comments on the proposed rule component of the Securities Industry Internet Web site (http://www.sec.gov/ change from interested persons and is Continuing Education Program rules/sro.shtml). Copies of the approving the proposed rule change on (‘‘Program’’) under NASD Rule 1120. submission, all subsequent an accelerated basis. The Securities Industry/Regulatory amendments, all written statements Council on Continuing Education with respect to the proposed rule I. Self-Regulatory Organization’s (‘‘Council’’)4 was organized in 1995 to change that are filed with the Statement of the Terms of Substance of facilitate cooperative industry/ Commission, and all written the Proposed Rule Change regulatory coordination of the communications relating to the administration and future development proposed rule change between the NASD is proposing to amend Section of the Program in keeping with Commission and any person, other than 4 of Schedule A to the NASD By-Laws applicable industry regulations and those that may be withheld from the to reduce fees for the Regulatory changing industry needs. Its roles public in accordance with the Element of the continuing education 3 include recommending and helping provisions of 5 U.S.C. 552, will be requirements of NASD Rule 1120. develop specific content and questions available for inspection and copying in Below is the text of the proposed rule for the Regulatory Element, defining the Commission’s Public Reference change. Proposed new language is in minimum core curricula for the Firm Room. Copies of such filing also will be Element component of the Program, and available for inspection and copying at 13 17 CFR 200.30–3(a)(12). 1 developing and updating information the principal office of NASD. All 15 U.S.C. 78s(b)(1). comments received will be posted 2 17 CFR 240.19b–4. 3 NASD filed a proposed rule change (for 4 As of the date of this rule filing, the Council without change; the Commission does immediate effectiveness under Section 19(b)(3) of consists of 17 individuals, six of whom represent not edit personal identifying the Act) to reduce the Regulatory Element self-regulatory organizations (the American Stock information from submissions. You continuing education fees from $65 to $60 on Exchange LLC, the Chicago Board Options should submit only information that December 24, 2003 (the ‘‘original rule proposal’’). Exchange, Inc., the Municipal Securities While a signed receipt for the original rule proposal Rulemaking Board, NASD, the New York Stock you wish to make available publicly. All was obtained upon arrival at the SEC’s premises, Exchange, Inc., and the Philadelphia Stock the original rule proposal was never delivered to Exchange, Inc.) and 11 whom represent the 12 15 U.S.C. 78s(b)(3)(A). the SEC’s Division of Market Regulation. industry.
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about the Program for industry-wide Electronic Comments Commission finds that the proposed dissemination. • Use the Commission’s Internet rule change is consistent with the It is the Council’s responsibility to comment form (http://www.sec.gov/ requirements of Section 15A(b)(5) of the maintain the Program on a revenue 8 rules/sro.shtml); or Act because it provides for the neutral basis while maintaining • Send an e-mail to rule- equitable allocation of reasonable dues, adequate reserves. In its annual [email protected]. Please include File fees, and other charges among members, financial review, the Council analyzed Number SR–NASD–2004–115 on the issuers, and other persons using any projected revenues and expenses subject line. facility or system which the association through 2008. The analysis showed that operates.9 Specifically, the proposed fee the current surplus, which is adequate Paper Comments reduction will enable the Program to be for the Program’s needs, would likely • Send paper comments in triplicate maintained on a revenue neutral basis grow over the next two years if to Jonathan G. Katz, Secretary, while simultaneously reducing the fee Regulatory Element volumes continue at Securities and Exchange Commission, charged to members. current levels and the fee is maintained 450 Fifth Street, NW., Washington, DC at $65 per session. The analysis also The Commission finds good cause to 20549–0609. showed that reserves would remain approve the proposed rule change prior All submissions should refer to File adequate if the fee for a Regulatory to the thirtieth day after the date of Number SR–NASD–2004–115. This file Element session were reduced by $5 per publication of notice thereof in the number should be included on the session. As such, at its December 2003 Federal Register. The NASD represents meeting, the Council unanimously subject line if e-mail is used. To help the that the original rule proposal was supported a reduction of the fee that Commission process and review your delivered to the SEC for filing on firms pay when their registered persons comments more efficiently, please use December 24, 2003. The Commission take the Regulatory Element from $65 to only one method. The Commission will notes that while a signed receipt for the $60 per session. This is the second post all comments on the Commission’s original rule proposal was obtained reduction in fees since the Program Internet Web site (http://www.sec.gov/ upon arrival at the SEC’s premises, the began in 1995. The first was a reduction rules/sro.shtml). Copies of the original rule proposal was never of $10 (from $75 to $65) that took place submission, all subsequent received by the SEC’s Division of in 1999.5 amendments, all written statements Market Regulation. The original rule with respect to the proposed rule 2. Statutory Basis proposal was filed for immediate change that are filed with the effectiveness under Section 19(b)(3) of NASD believes that the proposed rule Commission, and all written the Act with an implementation date of communications relating to the change is consistent with the provisions January 1, 2004. As such, NASD made 6 proposed rule change between the of Section 15A of the Act, in general, changes to Web Central Registration 7 Commission and any person, other than and with Section 15A(b)(5) of the Act, Depository (Web CRD ) to charge those that may be withheld from the in particular, in that it provides for the members the reduced $60 fee beginning public in accordance with the equitable allocation of reasonable dues, January 1, 2004 consistent with the provisions of 5 U.S.C. 552, will be fees and other charges among members actions of the Council. Accordingly, this available for inspection and copying in and issuers and other persons using any rule change also is effective retroactive the Commission’s Public Reference facility or system which the NASD to January 1, 2004. Based on the above, Room. Copies of the filing also will be operates or controls. the Commission believes that there is available for inspection and copying at A. Self-Regulatory Organization’s the principal offices of NASD. All good cause, consistent with Section Statement on Burden on Competition 15A(b)(5) 10 and Section 19(b)(2) of the comments received will be posted 11 NASD believes that the proposed rule without change; the Commission does Act to approve the proposal on an change does not impose any burden on not edit personal identifying accelerated basis. competition that is not necessary or information from submissions. You V. Conclusion appropriate in furtherance of the should submit only information that purposes of the Act. you wish to make available publicly. All It is therefore ordered, pursuant to Section 19(b)(2) of the Act,12 that the C. Self-Regulatory Organization’s submissions should refer to File proposed rule change (SR–NASD–2004– Statement on Comments on the Number SR–NASD–2004–115 and 115) is hereby approved on an Proposed Rule Change Received From should be submitted on or before accelerated basis. Members, Participants, or Others September 2, 2004. Written comments were neither IV. Commission’s Finding and Order For the Commission, by the Division of solicited nor received. Granting Accelerated Approval of Market Regulation, pursuant to delegated Proposed Rule Changes authority.13 III. Solicitation of Comments NASD has requested that the Margaret H. McFarland, Interested persons are invited to Commission find good cause pursuant Deputy Secretary. submit written data, views, and to Section 19(b)(2) of the Act for [FR Doc. 04–18416 Filed 8–11–04; 8:45 am] arguments concerning the foregoing, approving the proposed rule change BILLING CODE 8010–01–P including whether the proposed rule prior to the 30th day after publication in change is consistent with the Act. the Federal Register. The Commission 8 15 U.S.C. 78o-3(b)(5). Comments may be submitted by any of finds that the proposed rule change is 9 In approving this proposed rule change, the the following methods: consistent with the requirements of the Commission notes that it has considered the Act and the rules and regulations proposed rule’s impact on efficiency, competition, 5 Securities Exchange Act Release No. 40851 and capital formation. 15 U.S.C. 78c(f). (December 28, 1998), 64 FR 554 (January 5, 1999) thereunder applicable to NASD and, in 10 15 U.S.C. 78o-3(b)(5). (SR–NASD–98–95). particular, the requirements of Section 11 15 U.S.C. 78s(b)(2). 6 15 U.S.C. 78o-3. 15A and the rules and regulations 12 15 U.S.C. 78s(b)(2). 7 15 U.S.C. 78o-3(b)(5). thereunder. After careful review the 13 17 CFR 200.30–3(a)(12).
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SECURITIES AND EXCHANGE Quote Refresh Functionality and does rule change. The text of these statements COMMISSION not designate to Nasdaq an alternative may be examined at the places specified refresh size, which must be at least one in Item IV below. Nasdaq has prepared [Release No. 34–50149; File No. SR–NASD– summaries, set forth in Sections A, B, 2004–099] normal unit of trading. The automatic refresh size default amount shall be and C below, of the most significant Self-Regulatory Organizations; 1,000 shares. aspects of such statements. National Association of Securities (f)–(uu) No Change. A. Self-Regulatory Organization’s Dealers, Inc.; Notice of Filing and * * * * * Statement of the Purpose of, and Immediate Effectiveness of a Proposed 4710. Participant Obligations in the Statutory Basis for, the Proposed Rule Rule Change Permitting ITS/CAES Nasdaq Market Center Change Market Makers To Use the Automatic Quote Refresh Functionality for ITS (a) No Change. 1. Purpose Securities (b) Non-Directed Orders On March 2, 2004, the Commission (1) No Change. approved Nasdaq’s proposal to August 5, 2004. (2) Refresh Functionality transition the trading of exchange-listed Pursuant to section 19(b)(1) of the (A) No Change. securities in the Nasdaq Market Center Securities Exchange Act of 1934 (B) Auto Quote Refresh (‘‘AQR’’)— to the same platform that Nasdaq uses (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 Once a Nasdaq Market Maker’s or ITS/ for trading Nasdaq-listed securities.5 notice is hereby given that on June 25, CAES Market Maker’s Displayed Quote/ Currently, NASD Rule 4710(b)(2)(B) 2004, the National Association of Order size and Reserve Size on either allows market makers in Nasdaq Securities Dealers, Inc. (‘‘NASD’’), side of the market in the security has securities to have their quote refreshed through its subsidiary, The Nasdaq been decremented to an amount less automatically in the event that the Stock Market, Inc. (‘‘Nasdaq’’), filed than one normal unit of trading due to existing quote, on either side of the with the Securities and Exchange Nasdaq Market Center executions, the market, is decremented to less than one Commission (‘‘Commission’’) the Nasdaq Market Maker or ITS/CAES normal unit of trading (i.e., 100 shares) proposed rule change as described in Market Maker may elect to have The following an execution. This Items I, II, and III below, which Items Nasdaq Stock Market refresh the market functionality, known as ‘‘Auto Quote have been prepared by Nasdaq. Nasdaq maker’s quotation as follows: Refresh’’ or ‘‘AQR,’’ refreshes the market has filed this proposed rule change (i) Nasdaq will refresh the market maker’s quote to a price level and size pursuant to section 19(b)(3)(A)(ii) of the maker’s quotation price on the bid or that is designated by the market maker Act 3 and Rule 19b–4(f)(6) thereunder,4 offer side of the market, whichever is in advance.6 According to Nasdaq, which renders the proposal effective decremented to an amount less than a market makers use AQR to manage their upon filing with the Commission. The normal unit of trading, by a price quotations and to fulfill their quotation Commission is publishing this notice to interval designated by the Nasdaq obligations.7 In the absence of AQR, solicit comments on the proposed rule Market Maker or ITS/CAES Market market makers manage their quotes change from interested persons. Maker; and manually or via their firm’s own quote I. Self-Regulatory Organization’s (ii) Nasdaq will refresh the market management system. Nasdaq states that Statement of the Terms of Substance of maker’s displayed size to a level AQR is completely voluntary, but the Proposed Rule Change designated by the Nasdaq Market Maker widely used in the trading of Nasdaq or ITS/CAES Market Maker, or in the securities. Nasdaq proposes to amend NASD absence of such size level designation, The AQR functionality is not Rule 4701 (‘‘Definitions’’) and NASD to the automatic refresh size. currently available to market makers in Rule 4710 (‘‘Participant Obligations in (iii) This functionality shall produce ITS securities. Nasdaq states that when the Nasdaq Market Center’’) to allow an Attributable Quote/Order. it proposed the new platform for the market makers that trade Intermarket (iv) The AQR functionality described trading of ITS securities, it decided not Trading System securities (‘‘ITS/CAES in this subparagraph shall only be to offer the AQR functionality to market makers’’) to use the Automatic available for use in connection with a expedite the launch of the system. Quote Refresh functionality. The text of Nasdaq Market Maker’s or ITS/CAES Nasdaq believes that removing the AQR the proposed rule change appears Market Maker’s ‘‘Legacy Quote.’’ This functionality for ITS securities allowed below. New language is in italics. functionality shall be available only to Nasdaq to focus on the modification of Deleted text is in brackets. Nasdaq Market Makers or ITS/CAES the trading platform to accommodate * * * * * Market Makers. the requirements of the ITS Plan, as well as on the functionality that Nasdaq 4701. Definitions [(v) The AQR functionality shall not be available to any participant for any believed was critical to market Unless stated otherwise, the terms ITS Security.] participants. Nasdaq believes that it is described below shall have the (3)–(8) No Change. now able to add the AQR functionality following meaning: (c)–(e) No Change. (a)–(d) No Change. 5 See Securities Exchange Act Release No. 49349 (e) The term ‘‘automatic refresh size’’ * * * * * (March 2, 2004), 69 FR 10775 (March 8, 2004) shall mean the default size to which a (approving SR–NASD–2003–149). II. Self-Regulatory Organization’s 6 Market makers may designate their quotes in Nasdaq Market Maker’s or ITS/CAES Statement of the Purpose of, and round lots only. Telephone conversation between Market Maker’s quote will be refreshed Statutory Basis for, the Proposed Rule Jeffrey S. Davis, Associate Vice President and pursuant to NASD Rule 4710(b)(2), if Change Associate General Counsel, Nasdaq, and Lisa N. the market maker elects to utilize the Jones, Special Counsel and Marisol Rubecindo, In its filing with the Commission, Attorney, Division of Market Regulation, Commission, on August 3, 2004. 1 Nasdaq included statements concerning 15 U.S.C. 78s(b)(1). 7 Nasdaq notes that for purposes of Rule 11Ac1– 2 17 CFR 240.19b–4. the purpose of, and basis for, the 1(c) under the Act, quotes generated by the AQR 3 15 U.S.C. 78s(b)(3)(A)(ii). proposed rule change and discussed any functionality are considered firm. 17 CFR 11Ac1– 4 17 CFR 240.19b–4(f)(6). comments it received on the proposed 1(c).
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to the tools available for trading ITS change, the Commission may summarily For the Commission, by the Division of securities. Nasdaq believes that the AQR abrogate the proposed rule change if it Market Regulation, pursuant to delegated functionality should benefit investors by appears to the Commission that such authority.13 assisting ITS/CAES market makers in action is necessary or appropriate in the Margaret H. McFarland, maintaining continuous two-sided public interest, for the protection of Deputy Secretary. quotes and providing added liquidity to investors, or otherwise in furtherance of [FR Doc. 04–18419 Filed 8–12–04; 8:45 am] 8 the market following an execution. the purposes of the Act. BILLING CODE 8010–01–P 2. Statutory Basis IV. Solicitation of Comments Nasdaq believes that the proposed Interested persons are invited to SECURITIES AND EXCHANGE rule change is consistent with the submit written data, views, and COMMISSION provisions of section 15A of the Act,9 in arguments concerning the foregoing, [Release No. 34–50157; File No. SR–NASD– general and with section 15A(b)(6) of including whether the proposed rule 2004–095] the Act,10 in particular, which requires change is consistent with the Act. that the rules of the NASD be designed Comments may be submitted by any of Self-Regulatory Organizations; Notice to prevent fraudulent and manipulative the following methods: of Filing and Immediate Effectiveness acts and practices, to promote just and Electronic Comments of Proposed Rule Change by National equitable principles of trade, to remove Association of Securities Dealers, Inc. impediments to a free and open market • Use the Commission’s Internet Adopting a Fingerprinting Program for and a national market system, and, in comment for (http://www.sec.gov/rules/ NASD Employees and Independent general, to protect investors and the sro.shtml); or Contractors in the State of New York, public interest. Nasdaq believes that the • Send an e-mail to rule- and, as Dictated by Business Need, in current proposal is consistent with [email protected]. Please include File Other Jurisdictions those objectives in that it increases Number SR–NASD–2004–099 on the transparency, liquidity and order subject line. August 5, 2004. interaction in ITS securities in the Pursuant to section 19(b)(1) of the Nasdaq Market Center. Paper Comments Securities Exchange Act of 1934 • Send paper comments in triplicate (‘‘Act’’),1 and Rule 19b–4 thereunder,2 B. Self-Regulatory Organization’s notice is hereby given that on June 18, Statement on Burden on Competition to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 2004, the National Association of Nasdaq does not believe that the 450 Fifth Street, NW., Washington, DC Securities Dealers, Inc. (‘‘NASD’’), filed proposed rule change will result in any 20549–0609. with the Securities and Exchange burden on competition that is not All submissions should refer to File Commission (‘‘Commission’’) the necessary or appropriate in furtherance Number SR–NASD–2004–099. This file proposed rule change as described in of the purposes of the Act. number should be included on the Items I, II, and III below, which Items C. Self-Regulatory Organization’s subject line if e-mail is used. To help the have been prepared by NASD. The Statement on Comments on the Commission process and review your NASD filed the proposed rule change comments more efficiently, please use under paragraph (f)(3) of Rule 19b–4 Proposed Rule Change Received From 3 Members, Participants or Others only one method. The Commission will under the Act. The Commission is post all comments on the Commission’s publishing this notice to solicit Written comments were neither Internet Web site (http://www.sec.gov/ comments on the proposed rule change solicited nor received. rules/sro.shtml). Copies of the from interested persons. III. Date of Effectiveness of the submission, all subsequent I. Self-Regulatory Organization’s Proposed Rule Change and Timing for amendments, all written statements Statement of the Terms of Substance of Commission Action with respect to the proposed rule the Proposed Rule Change Because the foregoing proposed rule change that are filed with the Commission, and all written Pursuant to New York State law, the change does not: NASD proposes to adopt a program for (i) significantly affect the protection of communications relating to the proposed rule change between the conducting fingerprint-based investors or the public interest; background checks of NASD employees (ii) impose any significant burden on Commission and any person, other than those that may be withheld from the and independent contractors in the competition; and State of New York, and in other (iii) become operative for 30 days public in accordance with the jurisdictions as business need may from the date on which it was filed, or provisions of 5 U.S.C. 552, will be dictate. such shorter time as the Commission available for inspection and copying in Below is the text of the proposed rule may designate if consistent with the the Commission’s Public Reference change. Proposed new language is protection of investors and the public Room. Copies of the filing also will be italicized. interest, it has become effective available for inspection and copying at pursuant to section 19(b)(3)(A) of the the principal office of NASD. All * * * * * Act 11 and Rule 19b–4(f)(6) comments received will be posted Policy To Conduct Fingerprint-Based thereunder.12 At any time within 60 without change; the Commission does Background Checks of NASD Employees days of the filing of the proposed rule not edit personal identifying and Independent Contractors information from submissions. You (a) In accordance with the 8 Nasdaq notes that it will notify market should submit only information that participants of the operative date of the proposal via you wish to make available publicly. All requirements of the law of the State of Head Trader Alert on www.nasdaqtrader.com. submissions should refer to File 9 15 U.S.C. 78o–3. 13 17 CFR 200.30–3(a)(12). 10 15 U.S.C. 78o–3(b)(6). Number SR–NASD–2004–099 and 1 15 U.S.C. 78s(b)(1). 11 15 U.S.C. 78s(b)(3)(A). should be submitted on or before 2 17 CFR 240.19b–4. 12 17 CFR 240.19b–4(f)(6). September 2, 2004. 3 17 CFR 240.19b–4(f)(3).
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New York (‘‘New York State’’), it shall been given notice and three processing and storing fingerprint cards be the policy of NASD to conduct a opportunities to comply. and criminal record information fingerprint-based criminal records * * * * * received from the FBI database with check of (i) all prospective and current respect to such cards. Although section employees located in New York State, I. Self-Regulatory Organization’s 17(f)(2) does explicitly direct the and (ii) all prospective and current Statement of the Purpose of, and Attorney General of the United States independent contractors and temporary Statutory Basis for, the Proposed Rule (i.e., the FBI) to provide SROs employees located in New York State Change designated by the Commission with who provide services to NASD within In its filing with the Commission, access to criminal history record New York State and who have access to NASD included statements concerning information, it does not, however, secure records or systems, or other the purpose of and basis for the require SROs to fingerprint their own material or secure buildings or secure proposed rule change and discussed any employees. NASD believes, therefore, property for a specified number of days comments it received on the proposed that a proposed rule change for a as determined by NASD from time to rule change. The text of these statements fingerprinting program for NASD time. may be examined at the places specified employees and independent contractors (b) As business need may dictate and in Item IV below. NASD has prepared located in New York State is a necessary where permitted by applicable law, summaries, set forth in Sections A, B, component of NASD’s compliance with NASD will implement a program and C below, of the most significant New York State law, and of any plan by outside of New York State to conduct a aspects of such statements. NASD, as dictated by its assessment of fingerprint-based criminal records business need, to implement a program (A) Self-Regulatory Organization’s check of (i) any or all prospective and for fingerprint-based background checks Statement of the Purpose of, and current employees, and (ii) any or all of its employees and independent Statutory Basis for, the Proposed Rule prospective and current independent contractors in other jurisdictions as Change contractors or temporary employees permitted by law. who provide services to NASD and who 1. Purpose As reflected in the text of the have access to records or systems, or On August 20, 2002, Governor George proposed rule change, the program other material or secure buildings or E. Pataki signed into law an act that applies to: (1) Prospective and current secure property for a specified number requires fingerprint-based background NASD employees in New York State, as of days as determined by NASD from checks of self-regulatory organization well as prospective and current time to time. (‘‘SRO’’) employees who are regularly temporary employees and independent (c) In implementing the program in employed in New York State.4 The New contractors in New York State who have New York State or in other jurisdictions, York law also requires an SRO to or are anticipated to have access to NASD shall submit fingerprint images fingerprint independent contractors that NASD facilities in New York State or or cards obtained pursuant to the provide services to the SRO if those NASD records or systems for a specified foregoing program to the Attorney individuals have ‘‘access to records number of days as determined by NASD General of the United States or his or * * * or other material or secure from time to time, and (2) as NASD her designee for identification and buildings or secure property, which deems necessary according to business processing. NASD shall at all times place the security of [the SRO] at risk.’’ 5 need, to prospective and/or current maintain the security of fingerprint The New York law requires NASD to employees in other jurisdictions, as well images or cards and information implement and maintain a as prospective and current temporary received from the Attorney General or fingerprinting program for employees employees and independent contractors his or her designee. and certain independent contractors in who have or are anticipated to have (d) NASD shall evaluate information New York State. access to NASD facilities or records in received from the Attorney General or Access to the Federal Bureau of other jurisdictions. his or her designee in accordance with Investigation’s (‘‘FBI’’) database of NASD evaluates information received the terms of a written fingerprint policy fingerprint-based criminal records is from the FBI concerning an individual and provisions of applicable law. A permitted only when authorized by law. in accordance with the terms of NASD’s felony or serious misdemeanor Numerous Federal and State laws written fingerprint policy, which conviction will be a factor in authorize employers to conduct reflects the application of employment considering whether to hire a fingerprint-based background checks laws governing the use of information prospective employee, take adverse that make use of the FBI’s database.6 concerning criminal convictions in employment action with respect to a Notably, section 17(f)(2) of the Act 7 and employment decisions. In accordance current employee, or deny prospective SEC Rule 17f–2 8 require employees of with such laws, a felony or serious or current independent contractors or broker-dealers, transfer agents, and misdemeanor conviction will be a factor temporary employees access to NASD’s clearing agencies to be fingerprinted and in considering whether to hire a facilities or records. authorize SROs to maintain facilities for prospective employee, take adverse (e) A prospective employee who employment action with respect to a refuses to submit to fingerprinting shall 4 2002 N.Y. Laws 453 (Aug. 20, 2002). current employee, or deny prospective be denied employment by NASD, and a 5 2002 N.Y. Laws 453 (Aug. 20, 2002). or current independent contractors or prospective independent contractor or 6 See, e.g., 42 U.S.C. 5119a (child care providers); temporary employees access to NASD’s Pub. L. 92–544, 86 Stat. 1109, 1115 (employees of facilities or records. temporary employee who refuses to federally chartered or insured banks); Alaska Stat. submit to fingerprinting under the 04.11.295 (liquor license applicants); Ariz. Rev. 2. Statutory Basis program shall be denied access to Stat. 32–122.02 (home inspectors); Cal. Bus. & Prof. NASD facilities or records. A current Code 6980.18 (locksmiths); Fla. Stat. 468.453 NASD believes that the proposed rule employee, independent contractor, or (athlete agents); Official Code Ga. Ann. 43–47–6 change is consistent with section (used car dealers); Ohio Rev. Code Ann. 3770.051 9 temporary employee who refuses to (vendors of lottery equipment). 15A(b)(6) of the Act , which requires, submit to fingerprinting under the 7 15 U.S.C. 78q(f)(2). program will be terminated after having 8 17 CFR 240.17f-2. 9 15 U.S.C. 78o-3(6).
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among other things, that NASD’s rules change, including whether the proposed SECURITIES AND EXCHANGE must be designed to prevent fraudulent rule change is consistent with the Act. COMMISSION and manipulative acts and practices, Comments may be submitted by any of [Release No. 34–50145; File No. SR–NSX– promote just and equitable principles of the following methods: 2004–11] trade, and, in general, protect investors and the public interest. NASD believes Electronic Comments Self-Regulatory Organizations; Notice the proposed rule change will provide a • Use the Commission’s Internet of Filing and Immediate Effectiveness basis for NASD’s compliance with New comment for (http://www.sec.gov/rules/ of Proposed Rule Change by National York State law, which requires sro.shtml); or Stock Exchange Relating to fingerprint-based background checks of Workstation Fee SRO employees who are regularly • Send an e-mail to rule- employed in New York State as well as [email protected]. Please include SR– August 4, 2004. of independent contractors that provide NASD–2004–095 on the subject line. Pursuant to Section 19(b)(1) of the services to the SRO if those individuals Securities Exchange Act of 1934 Paper Comments 1 2 have ‘‘access to records * * * or other (‘‘Act’’), and Rule 19b–4 thereunder, notice is hereby given that on June 30, material or secure buildings or secure • Send paper comments in triplicate 2004, National Stock ExchangeSM (the property, which place the security of to Jonathan G. Katz, Secretary, ‘‘Exchange’’ or ‘‘NSX’’) filed with the [the SRO] at risk’’, and further permit Securities and Exchange Commission, NASD to implement a fingerprinting Securities and Exchange Commission 450 Fifth Street, NW., Washington, DC (the ‘‘Commission’’) a proposed rule program in other jurisdictions, as 20549–0609. business need may dictate. change. On July 15, 2004, NSX filed All submissions should refer to SR- Amendment No. 1 to the proposed rule (B) Self-Regulatory Organization’s NASD–2004–095. This file number change.3 The proposed rule change, as Statement on Burden on Competition should be included on the subject line amended, is described in Items I, II and NASD does not believe that the if e-mail is used. To help the III below, which Items have been proposed rule change will result in any Commission process and review your prepared by the Exchange. The burden on competition that is not comments more efficiently, please use Exchange filed the proposal pursuant to necessary or appropriate in furtherance only one method. The Commission will Section 19(b)(3)(A)(ii) of the Act 4 and of the purposes of the Act. post all comments on the Commission’s Rule 19b–4(f)(2) 5 thereunder, which renders the proposal effective upon (C) Self-Regulatory Organization’s Internet Web site (http://www.sec.gov/ rules/sro.shtml). Copies of the filing with the Commission. The Statement on Comments on the Commission is publishing this notice to Proposed Rule Change Received From submission, all subsequent amendments, all written statements solicit comments on the proposed rule Members, Participants, or Others change, as amended, from interested with respect to the proposed rule persons. Written comments were neither change that are filed with the solicited nor received. Commission, and all written I. Self-Regulatory Organization’s III. Date of Effectiveness of the communications relating to the Statement of the Terms of Substance of Proposed Rule Change and Timing for proposed rule change between the the Proposed Rule Change Commission Action. Commission and any person, other than The Exchange is proposing to amend The proposed rule change has been those that may be withheld from the its schedule of fees to increase its filed by the NASD pursuant to section public in accordance with the Workstation Fee. The Exchange 19(b)(3)(A) of the Act 10 and provisions of 5 U.S.C. 552, will be implemented these proposed changes, subparagraph (f)(3) of Rule 19b–4 available for inspection and copying in as amended, on July 1, 2004. thereunder.11 Because the foregoing the Commission’s Public Reference Below is the text of the proposed rule proposed rule change is concerned Room. Copies of such filing also will be change. Proposed new language is solely with the administration of the available for inspection and copying at italicized; proposed deletions are in NASD, it has become effective pursuant the principal office of NASD. All brackets. to Section 19(b)(3)(A) of the Act 12 and comments received will be posted * * * * * 13 Rule 19b–4(f)(3) thereunder. without change; the Commission does Rules of National Stock Exchange At any time within 60 days of the not edit personal identifying filing of the proposed rule change, the information from submissions. You * * * * * Commission may summarily abrogate should submit only information that Chapter XI such proposed rule change if it appears you wish to make available publicly. All Trading Rules to the Commission that such action is submissions should refer to SR–NASD– necessary or appropriate in the public 2004–095 and should be submitted on * * * * * interest, for the protection of investors, or before September 2, 2004. Rule 11.10 National Securities or otherwise in furtherance of the Trading System Fees. purposes of the Act. For the Commission, by the Division of A. Trading Fees. Market Regulation, pursuant to delegated 14 IV. Solicitation of Comments authority. 1 15 U.S.C. 78s(b)(1). Interested persons are invited to Margaret H. McFarland, 2 17 CFR 240.19b–4. 3 submit written data, views, and Deputy Secretary. See letter from James C. Yong, Senior Vice President, Regulation and General Counsel of NSX, arguments concerning the proposed rule [FR Doc. 04–18450 Filed 8–11–04; 8:45 am] to Nancy Sanow, Assistant Director, Division of BILLING CODE 8010–01–P Market Regulation, Commission, dated July 14, 10 15 U.S.C. 78s(b)(3)(A). 2004 (‘‘Amendment No. 1’’). In Amendment No. 1, 11 17 CFR 240.19b–4(f)(3) NSX made typographical corrections to its rule text. 12 15 U.S.C. 78s(b)(3)(A). 4 15 U.S.C. 78s(b)(3)(A)(ii). 13 17 CFR 240.19b–4(f)(3). 14 17 CFR 200.30–3(a)(12). 5 17 CFR 240.19b–4(f)(2).
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(a)–(q) No change. system, and, in general, to protect comments more efficiently, please use (r) Workstation Fee. Every member investors and the public interest. only one method. The Commission will using the Exchange Workstation shall be post all comments on the Commission’s B. Self-Regulatory Organization’s charged [$750.00]$1,000.00 per device Internet Web site (http://www.sec.gov/ Statement on Burden on Competition per month. rules/sro.shtml). Copies of the B. No change. The Exchange does not believe that submission, all subsequent C. No change. the proposed rule change, as amended, amendments, all written statements * * * * * will impose any inappropriate burden with respect to the proposed rule on competition. change that are filed with the II. Self-Regulatory Organization’s Commission, and all written Statement of the Purpose of, and C. Self-Regulatory Organization’s Statement on Comments on the communications relating to the Statutory Basis for, the Proposed Rule proposed rule change between the Change Proposed Rule Change Received From Members, Participants, or Others Commission and any person, other than In its filing with the Commission, the those that may be withheld from the Exchange included statements No written comments were solicited public in accordance with the concerning the purpose of and basis for or received in connection with the provisions of 5 U.S.C. 552, will be the proposed rule change and discussed proposed rule change. available for inspection and copying in any comments it received on the III. Date of Effectiveness of the the Commission’s Public Reference proposed rule change. The text of these Proposed Rule Change and Timing for Room, 450 Fifth Street, NW., statements may be examined at the Commission Action Washington, DC 20549. Copies of such places specified in Item IV below. The filings will also be available for Exchange has prepared summaries, set The foregoing rule change, as inspection and copying at the principal amended, has become effective pursuant office of the Exchange. All comments forth in sections A, B, and C below, of 9 to Section 19(b)(3)(A)(ii) of the Act and received will be posted without change; the most significant aspects of such 10 statements. subparagraph (f)(2) of Rule 19b–4 the Commission does not edit personal thereunder because it involves a identifying information from A. Self-Regulatory Organization’s member due, fee or other charge. At any submissions. You should submit only Statement of the Purpose of, and time within sixty (60) days of the filing information that you wish to make Statutory Basis for, the Proposed Rule of such proposed rule change, the publicly available. All submissions Change Commission may summarily abrogate should refer to file number SR–NSX– 1. Purpose such rule change if it appears to the 2004–011 and should be submitted on Commission that such action is or before September 2, 2004. In addition to utilizing proprietary or necessary or appropriate in the public third party software, member specialists interest, for the protection of investors, For the Commission by the Division of may connect to NSX’s National Market Regulation, pursuant to the delegated or otherwise in furtherance of the authority.11 Securities Trading System or ‘‘NSTS,’’ purposes of the Act. by utilizing an Exchange-supplied Margaret H. McFarland, Workstation for a monthly fee. IV. Solicitation of Comments Deputy Secretary. Subsection (r) of NSX Rule 11.10(A) Interested persons are invited to [FR Doc. 04–18415 Filed 8–11–04; 8:45 am] currently provides that every member submit written data, views and BILLING CODE 8010–01–P using the Exchange Workstation shall be arguments concerning the foregoing, charged a fee of $750 per device per including whether the proposed rule month. This fee will increase to $1,000 change, as amended, is consistent with SECURITIES AND EXCHANGE per device per month beginning July 1, the Act. Comments should be submitted COMMISSION 2004. The Exchange believes that the fee by any of the following methods: increase is reasonable and ensures that [Release No. 34–50146; File No. SR–NSX– each member pays an equitable share of Electronic Comments 2004–08] the costs associated with operating the • Use the Commission’s Internet Exchange. comment form (http://www.sec.gov/ Self-Regulatory Organizations; Notice rules/sro.shtml); or of Filing and Immediate Effectiveness 2. Statutory Basis • Send an E-mail to rule- of a Proposed Rule Change by the The Exchange believes the proposed [email protected]. Please include File National Stock Exchange Relating to rule change is consistent with Section Number SR–NSX–2004–011 on the Manual Processing Fee 6(b) of the Act,6 in general, and with subject line. August 4, 2004. Section 6(b)(4),7 in particular, in that it is designed to provide for the equitable Paper Comments Pursuant to Section 19(b)(1) of the allocation of reasonable dues, fees, and • Send paper comments in triplicate Securities Exchange Act of 1934 other charges. The Exchange believes to Jonathan G. Katz, Secretary, (‘‘Act’’),1 and Rule 19b–4 thereunder,2 the proposed change, as amended, is Securities and Exchange Commission, notice is hereby given that on June 28, also consistent with Section 6(b)(5) of 450 Fifth Street, NW., Washington, DC 2004, National Stock ExchangeSM (the the Act 8 in that it is designed to 20549–0609. ‘‘Exchange’’ or ‘‘NSXSM’’) filed with the promote just and equitable principles of All submissions should refer to File Securities and Exchange Commission trade, to remove impediments to and Number SR–NSX–2004–011. This file (the ‘‘Commission’’) a proposed rule perfect the mechanism of a free and number should be included on the change. On July 15, 2004, the Exchange open market and a national market subject line if e-mail is used. To help the filed Amendment No. 1 to the proposed Commission process and review your 6 15 U.S.C. 78f(b). 11 17 CFR 200.30–3(a)(12). 7 15 U.S.C. 78f(b)(4). 9 15 U.S.C. 78s(b)(3)(A)(ii). 1 15 U.S.C. 78s(b)(1). 8 15 U.S.C. 78f(b)(5). 10 17 CFR 240.19b–4(f)(2). 2 17 CFR 240.19b–4.
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rule change.3 The proposed rule change, there will be a minimum charge of $0.10 A. Self-Regulatory Organization’s as amended, is described in Items I, II per odd-lot transaction. Statement of the Purpose of, and and III below, which Items have been (c)–(d) No change. Statutory Basis for, the Proposed Rule Change prepared by the Exchange. The (e) Crosses and Meets Exchange filed the proposal pursuant to 1. Purpose Section 19(b)(3)(A)(ii) of the Act 4 and (1)–(3) No change. Rule 19b–4(f)(2) 5 thereunder, which (4) Users executing crosses and meets Currently, orders can be entered on renders the proposal effective upon in Tape A, B or C securities through the the Exchange either via an electronic filing with the Commission. The Exchange’s System Supervisory Center connection or by phoning the NSX Commission is publishing this notice to shall be charged $15 per contra-party, Control Room. There is currently no solicit comments on the proposed rule up to a maximum of $75 per side of transaction charge for Users, who are change, as amended, from interested transaction. This transaction fee shall not registered as Qualified or Designated persons. be in lieu of any transaction fee Dealers, executing crosses and meets in otherwise applicable under Paragraphs Tape B and C securities whether I. Self-Regulatory Organization’s (A)(e)(1) through (A)(e)(3) above. electronically or manually processed.7 Statement of the Terms of Substance of (f) No change. For Users executing crosses and meets the Proposed Rule Change in Tape A securities, there is currently The Exchange is proposing to amend (g) Proprietary (Principal) a charge of $0.0005 per share per side its schedule of fees to incorporate a Transactions for average daily volume up to 5 million manual processing fee for crosses and (1) (A) All Designated Dealers in shares per day and $0.000025 per share meets phoned into the NSX Control securities other than Nasdaq securities, per side for average daily volume above Room.6 The Exchange implemented except those acting as Preferencing 5 million shares, with a maximum these proposed changes, as amended, on Dealers or Contributing Dealers, will be charge of $37.50 per firm per side of July 1, 2004. charged $0.0025 per share ($0.10/100 transaction, whether electronically or Below is the text of the proposed rule shares) for principal transactions. manually processed. The Exchange is change, as amended. Proposed new (B) No change. proposing to introduce a manual language is italicized; proposed (2)–(4) No change. processing fee of $15 per contra-party, deletions are in brackets. with a cap of $75 per side, on every (h)–(j) No change. * * * * * cross or meet phoned into the NSX (k) Tape ‘‘B’’ Transactions. Except as Control Room because of the additional RULES OF NATIONAL STOCK provided in Paragraph (A)(e)(4) above, resources and expense associated with EXCHANGE the [The] Exchange will not impose a processing phoned-in orders. The * * * * * transaction fee on Consolidated Tape proposed manual processing fee will be ‘‘B’’ securities. In addition, Members in lieu of, and not in addition to, the CHAPTER XI Trading Rules will receive a 50 percent pro rata fees currently assessed for crosses and * * * * * transaction credit of gross Tape ‘‘B’’ meets and Tape A, Tape B and Tape C revenue; provided that, however, securities.8 The Exchange believes that Rule 11.10 National Securities Trading calculation of the transaction credit will System Fees the implementation of this manual be based on net Tape ‘‘B’’ revenues in processing fee is reasonable and ensures A. Trading Fees those fiscal quarters where the overall that each member pays an equitable (a) No change. revenue retained by the Exchange does share of the costs associated with (b) Odd-Lot Transactions. Members not offset actual expenses and working operating the Exchange. will be charged $0.50 per odd-lot capital needs. To the extent market data transaction when acting as agent or revenue from Tape ‘‘B’’ transactions is 2. Statutory Basis principal, except that members will earn subject to year-end adjustment, credits The Exchange believes the proposed a credit of $0.50 for every four round- provided under this program may be rule change, as amended, is consistent lot transactions executed (agency, adjusted accordingly. with Section 6(b) of the Act,9 in general, professional agency or principal) on the 10 (l)–(r) No change. and with Section 6(b)(4) of the Act, in [CSE]Exchange and printed on the particular, in that it is designed to B. No change. Consolidated Tape by the Exchange. provide for the equitable allocation of Notwithstanding the forgoing credit, C. No change. reasonable dues, fees, and other charges. * * * * * The Exchange believes the proposed 3 See Letter from James C. Yong, Senior Vice change, as amended, is also consistent II. Self-Regulatory Organization’s President, Regulation and General Counsel of the with Section 6(b)(5) of the Act 11 in that NSX, to Nancy Sanow, Assistant Director, Division Statement of the Purpose of, and it is designed to promote just and of Market Regulation, Commission, dated July 14, Statutory Basis for, the Proposed Rule 2004 (‘‘Amendment No. 1’’). In Amendment No. 1, equitable principles of trade, to remove Change NSX made technical corrections to its rule text and impediments to and perfect the clarified that the manual processing fee proposed as NSX Rule 11.10(A)(e)(4) will be in lieu of the fees In its filing with the Commission, the mechanism of a free and open market currently assessed for crosses and meets in Tape A, Exchange included statements and a national market system, and, in Tape B and Tape C securities. concerning the purpose of and basis for 4 15 U.S.C. 78s(b)(3)(A)(ii). the proposed rule change and discussed 7 Dealers executing crosses in Tape B securities 5 17 CFR 240.19b–4(f)(2). any comments it received on the are not charged a transaction fee. Dealers executing 6 The Exchange is also proposing two non- crosses in Tape C securities are charged a per share material revisions to its fee schedule to change one proposed rule change. The text of these fee of $0.001 per share for average daily volume up reference to the ‘‘CSE’’ (the Exchange was formerly statements may be examined at the to 5 million shares per day and $0.000025 per share known as The Cincinnati Stock Exchange or ‘‘CSE’’) places specified in Item IV below. The for average daily volume 5 million shares and above to the ‘‘Exchange’’ and to correct a typographical per day. Exchange has prepared summaries, set 8 error. The Exchange represents that these changes See Amendment No. 1. are administrative and non-substantive in nature forth in sections A, B, and C below, of 9 15 U.S.C. 78f(b). and therefore not subject to notice and comment. the most significant aspects of such 10 15 U.S.C. 78f(b)(4). See Amendment No. 1. statements. 11 15 U.S.C. 78f(b)(5).
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general, to protect investors and the 450 Fifth Street, NW., Washington, DC Commission (‘‘Commission’’), pursuant public interest. The Exchange also 20549–0609. to section 19(b)(1) of the Securities believes that the proposed change, as All submissions should refer to File Exchange Act of 1934 (‘‘Act’’) 1 and Rule amended, will create incentives for Number SR–NSX–2004–08. This file 19b-4 thereunder,2 a proposed rule members to electronically connect to the number should be included on the change to eliminate PCX Rule 6.76(d)(2), Exchange trading system, thereby subject line if e-mail is used. To help the which allows a Market Maker or Floor increasing efficiency and competition, Commission process and review your Broker to manually trade with orders which, in turn, will enhance the comments more efficiently, please use and Quotes with Size 3 in the National Market System. only one method. The Commission will Consolidated Book 4 by vocalizing a bid post all comments on the Commission’s or offer in a particular series and B. Self-Regulatory Organization’s Internet Web site (http://www.sec.gov/ effecting a trade with the Order Book Statement on Burden on Competition rules/sro.shtml). Copies of the Official (‘‘OBO’’). On June 22, 2004, the The Exchange does not believe that submission, all subsequent Exchange filed Amendment No. 1 to the the proposed rule change, as amended, amendments, all written statements proposed rule change.5 The proposed will impose any inappropriate burden with respect to the proposed rule rule change and Amendment No. 1 were on competition. change that are filed with the published for comment in the Federal Register on July 1, 2004.6 The C. Self-Regulatory Organization’s Commission, and all written Commission received no comments on Statement on Comments on the communications relating to the the proposal, as amended. This order Proposed Rule Change Received From proposed rule change between the approves the proposed rule change, as Members, Participants, or Others Commission and any person, other than those that may be withheld from the amended. No written comments were solicited public in accordance with the The Commission finds that the or received in connection with the provisions of 5 U.S.C. 552, will be proposed rule change, as amended, is proposed rule change. available for inspection and copying in consistent with the requirements of the Act and the rules and regulations III. Date of Effectiveness of the the Commission’s Public Reference thereunder applicable to a national Proposed Rule Change and Timing for Room, 450 Fifth Street, NW., securities exchange 7 and, in particular, Commission Action Washington, DC 20549. Copies of such filings will also be available for the requirements of section 6(b)(5) of the The foregoing rule change, as inspection and copying at the principal Act 8 and the rules and regulations amended, has become effective pursuant office of the Exchange. All comments thereunder. Specifically, the 12 to Section 19(b)(3)(A)(ii) of the Act received will be posted without change; Commission finds that the proposed 13 and subparagraph (f)(2) of Rule 19b–4 the Commission does not edit personal rule change, as amended, is designed to thereunder, because it involves a identifying information from promote just and equitable principles of member due, fee or other charge. At any submissions. You should submit only trade, to foster cooperation and time within sixty (60) days of the filing information that you wish to make coordination with persons engaged in of such proposed rule change, the publicly available. All submissions facilitating transactions in securities, Commission may summarily abrogate should refer to file number SR–NSX– and to remove impediments to and such rule change if it appears to the 2004–08 and should be submitted on or perfect the mechanism of a free and Commission that such action is before September 2, 2004. open market and a national market necessary or appropriate in the public system. interest, for the protection of investors, For the Commission by the Division of With this proposal, Market Makers Market Regulation, pursuant to the delegated or otherwise in furtherance of the authority.14 and Floor Brokers will be able to purposes of the Act. interact with the Consolidated Book by Margaret H. McFarland, electronic means only. The Exchange IV. Solicitation of Comments Deputy Secretary. represented that manually effecting a Interested persons are invited to [FR Doc. 04–18420 Filed 8–11–04; 8:45 am] trade with an OBO is not as efficient as submit written data, views and BILLING CODE 8010–01–P effecting a trade electronically using the arguments concerning the foregoing, PCX Plus technology. Accordingly, the including whether the proposed rule Commission believes that the proposal, SECURITIES AND EXCHANGE change is consistent with the Act. which has the effect of requiring that all COMMISSION Comments should be submitted by any trades with orders and Quotes with Size of the following methods: [Release No. 34–50143; File No. SR–PCX– in the Consolidated Book be executed Electronic Comments 2004–47] electronically, should enhance the • Use the Commission’s Internet Self-Regulatory Organizations; Order 1 15 U.S.C. 78s(b)(1). comment form (http://www.sec.gov/ Granting Approval to a Proposed Rule 2 17 CFR 240.19b–4. rules/sro.shtml); or Change and Amendment No. 1 Thereto 3 See PCX Rule 6.1(b)(33). • Send an E-mail to rule- by the Pacific Exchange, Inc. To 4 See PCX Rule 6.1(b)(37). [email protected]. Please include File Eliminate the Ability of Floor Brokers 5 See letter from Steven B. Matlin, Senior Attorney, PCX, to Nancy J. Sanow, Assistant Number SR–NSX–2004–08 on the and Market Makers To Manually Trade Director, Division of Market Regulation, subject line. With Orders and Quotes With Size in Commission, dated June 21, 2004 (‘‘Amendment No the Consolidated Book 1’’). In Amendment No. 1, the Exchange clarified Paper Comments the language describing the PCX Plus platform. • Send paper comments in triplicate August 4, 2004. 6 See Securities Exchange Act Release No. 49912 to Jonathan G. Katz, Secretary, On June 10, 2004, the Pacific (June 24, 2004), 69 FR 39995. Exchange, Inc. (‘‘PCX’’ or ‘‘Exchange’’) 7 In approving this proposal, the Commission has Securities and Exchange Commission, considered the proposed rule’s impact on filed with the Securities and Exchange efficiency, competition, and capital formation. See 12 15 U.S.C. 78s(b)(3)(A)(ii). 15 U.S.C. 78c(f). 13 17 CFR 240.19b–4(f)(2). 14 17 CFR 200.30–3(a)(12). 8 15 U.S.C. 78f(b)(5).
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efficiency of trading with orders and I. Self-Regulatory Organization’s 2. Statutory Basis Quotes with Size in the Consolidated Statement of the Terms of Substance of Book. The Commission notes that this the Proposed Rule Change The Exchange believes that the proposal does not change the manner in proposed rule change, as amended, is which Floor Brokers and Market Makers The Exchange is proposing to amend consistent with Section 6(b) of the Act, PCX Rules 6.93 and 6.94. These rules set 6 effect transactions with options that do in general, and furthers the objectives forth the way orders are handled 7 not trade on PCX Plus.9 of Section 6(b)(5), in particular, in that through Intermarket Option Linkage it is designed to facilitate transactions in It is therefore ordered, pursuant to (‘‘Linkage’’). The text of the proposed securities, to promote just and equitable section 19(b)(2) of the Act,10 that the rule change, as amended, is available at principles of trade, to enhance proposed rule change (File No. SR– the offices of the Exchange and the competition and to protect investors and PCX–2004–47), as amended, is Commission’s Public Reference Room. the public interest. approved. II. Self-Regulatory Organization’s B. Self-Regulatory Organization’s For the Commission, by the Division of Statement of the Purpose of, and Statement on Burden on Competition Market Regulation, pursuant to delegated Statutory Basis for, the Proposed Rule 11 authority. Change The Exchange does not believe that Margaret H. McFarland, the proposed rule change will impose Deputy Secretary. In its filing with the Commission, the any burden on competition that is not [FR Doc. 04–18417 Filed 8–11–04; 8:45 am] Exchange included statements necessary or appropriate in furtherance concerning the purpose of, and basis for, of the purposes of the Act. BILLING CODE 8010–01–P the proposed rule change and discussed any comments it received on the C. Self-Regulatory Organization’s proposed rule change. The text of these Statement on Comments on the SECURITIES AND EXCHANGE Proposed Rule Change Received From COMMISSION statements may be examined at the places specified in Item IV below. The Members, Participants, or Others Exchange has prepared summaries, set The Exchange did not solicit nor [Release No. 34–50153; File No. SR–PCX– forth in sections A, B and C below, of receive any written comments on the 2004–73] the most significant aspects of such proposed rule change. statements. Self-Regulatory Organizations; Notice III. Date of Effectiveness of the of Filing of Proposed Rule Change and A. Self-Regulatory Organization’s Proposed Rule Change and Timing for Amendment No. 1 Thereto by the Statement of the Purpose of, and Commission Action Pacific Exchange, Inc. Relating to the Statutory Basis for, the Proposed Rule Handling of Orders Pursuant to Change The foregoing rule change has become Intermarket Option Linkage 1. Purpose effective pursuant to section 19(b)(3)(A)(iii) of the Act 8 and August 5, 2004. The Exchange is proposing to amend subparagraph (f)(3) of Rule 19b–4 9 Pursuant to Section 19(b)(1) of the PCX Rules 6.93 and 6.94 to make thereunder because it is concerned Securities Exchange Act of 1934 administrative changes necessary as a solely with the administration of the (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 result of the Exchange’s change to a Exchange. At any time within 60 days notice is hereby given that on July 21, demutualized structure.4 PCX filed the of the filing of such proposed rule 2004, the Pacific Exchange, Inc. (‘‘PCX’’ recently approved changes to PCX Rules change, the Commission may summarily or ‘‘Exchange’’) filed with the Securities 6.93 and 6.94 prior to the Commission’s abrogate such rule change if it appears and Exchange Commission approval of a demutualized structure. to the Commission that such action is (‘‘Commission’’) the proposed rule The Commission approved the proposed necessary or appropriate in the public change as described in Items I, II and III changes to PCX Rules 6.93 and 6.94 interest, for the protection of investors, below, which Items have been prepared following the approval of the or otherwise in furtherance of the by the Exchange. On August 3, 2004, the demutualized structure.5 The approval purposes of the Act.10 of the demutualized PCX Rules Exchange filed Amendment No. 1 to the IV. Solicitation of Comments proposed rule change.3 The Commission eliminated references to PCX Members is publishing this notice to solicit and replaced such references with Interested persons are invited to comments on the proposed rule change, Option Trading Permits. As a result of submit written data, views, and the changes, the Exchange no longer as amended, from interested persons. arguments concerning the foregoing, retains any Members, and PCX Rules including whether the proposed rule 6.93 and 6.94 must therefore be 9 Phone conversation between Kelly Riley, change, as amended, is consistent with modified to comply with the approved Assistant Director, Division of Market Regulation, the Act. Comments may be submitted by Commission, and Steve B. Matlin, Senior Attorney, demutualized PCX Rules. Regulatory Policy, PCX, August 3, 2004. any of the following methods: 10 15 U.S.C. 78s(b)(2). 4 See Securities Exchange Act Release No. 49718 6 11 17 CFR 200.30–3(a)(12). (May 17,2004), 69 FR 29611 (May 24, 2004) (SR– 15 U.S.C. 78f(b). 1 15 U.S.C. 78s(b)(1). PCX–2004–08) (order approving PCX 7 15 U.S.C. 78f(b)(5). 2 17 CFR 240.19b–4. demutualization). 8 15 U.S.C. 78s(b)(3)(A)(iii). 3 See letter from Steven B. Matlin, Senior 5 See Securities Exchange Act Release Nos. 49890 9 17 CFR 240.19b–4(f)(3). Counsel, Regulatory Policy, PCX, to Nancy J. (June 17, 2004), 69 FR 36145 (June 28, 2004) (SR– 10 For purposes of calculating the 60-day period Sanow, Assistant Director, Division of Market PCX–2004–33) (order approving a change to within which the Commission may summarily Regulation, Commission, dated August 3, 2004 handling of Principal Acting as Agent Orders abrogate the proposed rule change under section (‘‘Amendment No. 1’’). In Amendment No. 1, the submitted through Linkage) and 49967 (July 2, 19(b)(3)(C) of the Act, the Commission considers Exchange submitted a new Form 19b–4, which 2004), 69 FR 41871(July 12, 2004) (SR–PCX–2004– that period to commence on August 3, 2004, the replaced and superceded the original filing in its 34) (order approving a change to the handling of date PCX filed Amendment No. 1 to the proposed entirety. Satisfaction Orders submitted through Linkage). rule change. See 15 U.S.C. 78s(b)(3)(C).
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Electronic Comments SECURITIES AND EXCHANGE $1 Strike Pilot Program expires on August 4, 2004. PCX states that its • COMMISSION Use the Commission’s Internet member firms have expressed a comment form (http://www.sec.gov/ [Release No. 34–50152; File No. SR–PCX– 2004–61] continued interest in listing additional rules/sro.shtml); or strike prices on low priced stocks so • Send an e-mail to rule- Self-Regulatory Organizations; Notice that they can provide their customers [email protected]. Please include File of Filing and Order Granting with greater flexibility in their Number SR–PCX 2004–73 on the subject Accelerated Approval of Proposed investment choices. For this reason, line. Rule Change by the Pacific Exchange, PCX proposes to extend the $1 Strike Inc. To Extend Until June 5, 2005, a Pilot Program. PCX notes that all of the Paper Comments Pilot Program Under Which It Lists issues eligible to be included in the $1 Options on Selected Stocks Trading Strike Pilot Program, the procedures for • Send paper comments in triplicate Below $20 at One-Point Intervals adding $1 strike intervals, the to Jonathan G. Katz, Secretary, procedures for phasing out $2.50 strike Securities and Exchange Commission, August 5, 2004. price intervals, the prohibition against 450 Fifth Street, NW., Washington, DC Pursuant to section 19(b)(1) of the listing long-term options (also known as 20549–0609. Securities Exchange Act of 1934 ‘‘LEAPS’’) in equity option classes at $1 1 2 All submissions should refer to File (‘‘Act’’), and Rule 19b-4 thereunder, strike price intervals, the procedures for Number SR–PCX–2004–73. This file notice is hereby given that on August 3, adding expiration months and the number should be included on the 2004, the Pacific Exchange, Inc. (‘‘PCX’’ procedures for deleting $1 strike or ‘‘Exchange’’) filed with the Securities subject line if e-mail is used. To help the intervals will all remain the same.3 and Exchange Commission Commission process and review your (‘‘Commission’’) the proposed rule 2. Statutory Basis comments more efficiently, please use change as described in Items I and II PCX believes that the continuation of only one method. The Commission will below, which Items have been prepared the $1 Strike Pilot Program will post all comments on the Commission’s by PCX. The Commission is publishing stimulate customer interest in options Internet Web site (http://www.sec.gov/ this notice to solicit comments on the overlying lower-priced stocks by rules/sro.shtml). Copies of the proposed rule change from interested creating greater trading opportunities submission, all subsequent persons. amendments, all written statements and flexibility. PCX further believes that with respect to the proposed rule I. Self-Regulatory Organization’s continuation of the $1 Strike Pilot Statement of the Terms of Substance of change that are filed with the Program will provide customers with the Proposed Rule Change the ability to more closely tailor Commission, and all written investment strategies to the precise communications relating to the PCX proposes to extend until June 5, movement of the underlying security. proposed rule change between the 2005, a pilot program under which it lists options on selected stocks trading For these reasons, PCX believes the Commission and any person, other than proposed rule change is consistent with those that may be withheld from the below $20 at $1 strike price intervals (‘‘$1 Strike Pilot Program’’). The text of the Act and the rules and regulations public in accordance with the the proposed rule change is available at thereunder and, in particular, the provisions of 5 U.S.C. 552, will be 4 the Office of the Secretary, PCX, and at requirements of section 6(b) of the Act. available for inspection and copying in the Commission. Specifically, PCX believes the proposed the Commission’s Public Reference rule change is consistent with the Section, 450 Fifth Street, NW., II. Self-Regulatory Organization’s requirements under section 6(b)(5) 5 that Washington, DC 20549. Copies of such Statement of the Purpose of, and the rules of an exchange be designed to filing also will be available for Statutory Basis for, the Proposed Rule promote just and equitable principles of inspection and copying at the principal Change trade, to prevent fraudulent and office of the Exchange. All comments In its filing with the Commission, manipulative acts, to remove received will be posted without change; PCX included statements concerning the impediments to and perfect the the Commission does not edit personal purpose of and basis for the proposed mechanism for a free and open market identifying information from rule change and discussed any and a national market system, and, in submissions. You should submit only comments it received on the proposed information that you wish to make rule change. The text of these statements 3 The Commission approved the $1 Strike Pilot available publicly. All submissions may be examined at the places specified Program on June 17, 2003. See Securities Exchange in Item IV below. PCX has prepared Act Release No. 48045 (June 17, 2003); 68 FR 37549 should refer to File Number SR–PCX (June 24, 2003) (‘‘Pilot Program Approval Order’’). 2004–73 and should be submitted on or summaries, set forth in sections A, B, See also Securities Exchange Act Release No. 49818 before September 2, 2004. and C below, of the most significant (June 4, 2004), 69 FR 33440 (June 15, 2004) (notice aspects of such statements. of filing and immediate effectiveness of File No. For the Commission, by the Division of SR–PCX–2004–39) (extending the $1 Strike Pilot Market Regulation, pursuant to delegated A. Self-Regulatory Organization’s Program until August 4, 2004) (‘‘Pilot Extension authority.11 Statement of the Purpose of, and Notice’’). The Pilot Program Approval Order and Statutory Basis for, the Proposed Rule the Pilot Extension Notice required PCX to provide Margaret H. McFarland, the Commission with certain information and data Change Deputy Secretary. covering the entire time the $1 Strike Pilot Program was in effect in the event that PCX proposed to, [FR Doc. 04–18418 Filed 8–11–04; 8:45 am] 1. Purpose among other things, extend the $1 Strike Pilot BILLING CODE 8010–01–P The purpose of this proposal is to Program. Accordingly, PCX has prepared and extend the PCX’s $1 Strike Pilot submitted a report (‘‘Pilot Program Report’’) that provides data and written analysis relating to the Program until June 5, 2003. The current five options classes PCX selected to participate in the $1 Strike Pilot Program. 1 15 U.S.C. 78s(b)(1). 4 15 U.S.C. 78f(b). 11 17 CFR 200.30–3(a)(12). 2 17 CFR 240.19b-4. 5 15 U.S.C. 78f(b)(5).
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general, to protect investors and the the Commission’s Public Reference associated with the additional options public interest. Room, 450 Fifth Street, NW., series listed as a result of the Pilot Washington, DC 20549. Copies of such B. Self-Regulatory Organization’s Program and the effect of these filing also will be available for Statement on Burden on Competition additional series on market inspection and copying at the principal fragmentation and on the capacity of the PCX does not believe that the office of PCX. All comments received Exchange’s, OPRA’s, and vendors’ proposed rule change, as amended, will will be posted without change; the automated systems. impose any burden on competition not Commission does not edit personal necessary or appropriate in furtherance identifying information from The Commission finds good cause for of the purposes of the Act. submissions. You should submit only approving the proposal prior to the information that you wish to make thirtieth day after the date of C. Self-Regulatory Organization’s available publicly. All submissions publication of notice of filing thereof in Statement on Comments on the should refer to File Number SR–PCX– the Federal Register. Accelerated Proposed Rule Change Received From 2004–61 and should be submitted on or approval of the proposed rule change is Members, Participants or Others before September 2, 2004. consistent with the protection of PCX has not solicited, and does not IV. Commission’s Findings and Order investors and the public interest intend to solicit, comments on this Granting Accelerated Approval of because it will permit the $1 Strikes proposed rule change. PCX has not Proposed Rule Change Pilot Program to continue without received any unsolicited written interruption through June 5, 2005. For comments from its members of other After careful review, the Commission these reasons, the Commission believes interested persons. finds that the proposed rule change is that there is good cause, consistent with consistent with the requirements of the Sections 6(b)(5) and 19(b) of the Act,8 to III. Solicitation of Comments Act and the rules and regulations approve the PCX’s proposal, as Interested persons are invited to thereunder applicable to a national amended, on an accelerated basis.9 submit written data, views, and securities exchange.6 In particular, the arguments concerning the foregoing, Commission finds that the proposed V. Conclusion including whether the proposed rule rule change is consistent with section change is consistent with the Act. 6(b)(5) of the Act,7 which requires, It is therefore ordered, pursuant to Comments may be submitted by any of among other things, that the rules of a section 19(b)(2) of the Act,10 that the the following methods: national securities exchange be proposed rule change (SR–PCX–2004– designed to remove impediments to and 61) is hereby approved on an Electronic Comments perfect the mechanism of a free and accelerated basis. • Use the Commission’s Internet open market and a national market comment form (http://www.sec.gov/ system, and, in general, to protect rules/sro.shtml); or investors and the public interest. • Send an e-mail to rule- Specifically, the Commission believes 8 15 U.S.C. 78f(b)(5) and 78s(b). [email protected]. Please include File the proposed listing of one point strike 9 If PCX proposes to (1) Extend the $1 Strike Pilot Number SR–PCX–2004–61 on the price intervals in selected equity Program beyond June 5, 2005; (2) expand the options on a pilot basis should provide number of options eligible for inclusion in the $1 subject line. Strike Pilot Program; or (3) seek permanent investors with more flexibility in the Paper Comments approval of the $1 Strike Pilot Program, it must trading of equity options overlying submit a pilot program report to the Commission • Send paper comments in triplicate stocks trading at more than $3 but less along with the filing of such proposal. The pilot to Jonathan G. Katz, Secretary, than $20, thereby furthering the public program report must cover the entire time the $1 interest by allowing investors to Strike Pilot Program was in effect and must include: Securities and Exchange Commission, (1) Data and written analysis on the open interest 450 Fifth Street, NW., Washington, DC establish equity options positions that and trading volume for options (at all strike price 20549–0609. are better tailored to meet their intervals) selected for the $1 Strike Pilot Program; All submissions should refer to File investment objectives. The Commission (2) delisted options series (for all strike price Number SR-PCX–2004–61. This file also believes that the Exchange’s limited intervals) for all options selected for the $1 Strike Pilot Program; (3) an assessment of the number should be included on the Pilot Program strikes a reasonable appropriateness of $1 strike price intervals for the subject line if e-mail is used. To help the balance between the Exchange’s desire options PCX selected for the $1 Strike Pilot Commission process and review your to accommodate market participants by Program; (4) an assessment of the impact of the $1 comments more efficiently, please use offering a wide array of investment Strike Pilot Program on the capacity of the PCX’s, opportunities and the need to avoid OPRA’s, and vendors’ automated systems; (5) any only one method. The Commission will capacity problems or other problems that arose post all comments on the Commission’s unnecessary proliferation of options during the operation of the $1 Strike Pilot Program Internet Web site (http://www.sec.gov/ series. The Commission expects the and how PCX addressed them; (6) any complaints rules/sro.shtml). Copies of the Exchange to monitor the applicable that PCX received during the operation of the $1 equity options activity closely to detect Strike Pilot Program and how PCX addressed them; submission, all subsequent and (7) any additional information that would help amendments, all written statements any proliferation of illiquid options to assess the operation of the $1 Strike Pilot with respect to the proposed rule series resulting from the narrower strike Program. The Commission expects PCX to submit change that are filed with the price intervals and to act promptly to a proposed rule change at least 60 days before the Commission, and all written remedy this situation should it occur. In expiration of the $1 Strike Pilot Program in the addition, the Commission requests that event PCX wishes to extend, expand, or seek communications relating to the permanent approval of the $1 Strike Pilot Program. proposed rule change between the PCX monitor the trading volume The Commission notes that the submission of a Commission and any person, other than satisfactory pilot program report along with a those that may be withheld from the 6 In approving this proposed rule change, the proposed rule change to extend, expand, or Commission has considered the proposed rule’s permanently approve the $1 Strike Pilot Program is public in accordance with the impact on efficiency, competition, and capital a condition precedent to the future operation of the provisions of 5 U.S.C. 552, will be formation. 15 U.S.C. 78c(f). PCX’s $1 Strike Pilot Program. available for inspection and copying in 7 15 U.S.C. 78f(b)(5). 10 15 U.S.C. 78s(b)(2).
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For the Commission, by the Division of Rule 651. Exchange’s Costs of Defending help protect against Exchange resources Market Regulation, pursuant to delegated Legal Proceedings being unnecessarily diverted from the authority.11 Any member, member organization, Exchange’s regulatory and business Margaret H. McFarland, foreign currency options participant, objectives, thus strengthening the Deputy Secretary. foreign currency options participant overall organization. To this end, the [FR Doc. 04–18451 Filed 8–11–04; 8:45 am] organization, or person associated with Exchange is proposing to adopt a rule BILLING CODE 8010–01–P any of the foregoing who fails to prevail similar to one already in effect at the in a lawsuit or other legal proceeding American Stock Exchange (‘‘AMEX’’) 7 instituted by such person or entity and other options exchanges requiring SECURITIES AND EXCHANGE against the Exchange or any of its board specified persons who bring legal COMMISSION members, officers, committee members, proceedings against the Exchange and/ [Release No. 34–50159; File No. SR–Phlx– employees, or agents, and related to the or persons acting on the Exchange’s 2004–47] business of the Exchange, shall pay to behalf but who do not prevail to the Exchange all reasonable expenses, reimburse the Exchange for all costs Self-Regulatory Organizations; including attorneys’ fees, incurred by associated with defending such Philadelphia Stock Exchange, Inc.; the Exchange in the defense of such proceedings when these costs exceed Notice of Filing and Immediate proceeding, but only in the event that fifty thousand dollars ($50,000). Effectiveness of Proposed Rule such expenses exceed $50,000.00. This 2. Statutory Basis Change Relating to Legal Fees provision shall not apply to disciplinary The Exchange believes that its Incurred by the Exchange actions by the Exchange, to proposal is consistent with Section 6(b) administrative appeals of Exchange August 5, 2004. of the Act,8 in general, and furthers the actions or in any specific instance where Pursuant to Section 19(b)(1) of the objectives of Section 6(b)(5), the Board 6 has granted a waiver of this Securities Exchange Act of 1934 (the specifically,9 in that it is designed to provision. ‘‘Act’’),1 and Rule 19b–4 thereunder,2 prevent fraudulent and manipulative notice is hereby given that on August 4, II. Self-Regulatory Organization’s acts and practices, to promote just and 2004, the Philadelphia Stock Exchange, Statement of the Purpose of, and equitable principles of trade, to foster Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with Statutory Basis for, the Proposed Rule cooperation and coordination with the Securities and Exchange Change persons engaged in facilitating Commission (‘‘Commission’’) the In its filing with the Commission, the transactions in securities, and to remove proposed rule change as described in Phlx included statements concerning impediments to and perfect the Items I, II, and III below, which Items the purpose of and basis for the mechanism of a free and open market have been prepared by the Exchange. proposed rule change and discussed any and a national market system, by Phlx filed this proposal pursuant to comments it received on the proposed requiring member litigants to reimburse Section 19(b)(3)(A) of the Act 3 and Rule rule change. The text of these statements the Exchange for costs of a legal defense 19b–4(f)(6) thereunder,4 which renders may be examined at the places specified under specified circumstances. the proposal effective upon filing with in Item IV below. The Phlx has prepared the Commission.5 The Commission is B. Self-Regulatory Organization’s summaries, set forth in Sections A, B publishing this notice to solicit Statement on Burden on Competition and C below, of the most significant comments on the proposed rule change The Exchange does not believe that aspects of such statements. from interested persons. the proposed rule change will impose A. Self-Regulatory Organization’s any inappropriate burden on I. Self-Regulatory Organization’s Statement of the Purpose of, and competition. Statement of the Terms of Substance of Statutory Basis for, the Proposed Rule the Proposed Rule Change C. Self-Regulatory Organization’s Change The Phlx proposes to adopt new Phlx Statement on Comments on the Rule 651 to require members, member 1. Purpose Proposed Rule Change Received From Members, Participants, or Others organizations, foreign currency options The purpose of the proposed rule participants, foreign currency options change is to enable the Exchange to No written comments were either participant organizations, or persons obtain reimbursement of legal costs solicited or received. associated with any of the foregoing incurred to defend litigation brought III. Date of Effectiveness of the (‘‘member litigants’’) who bring legal against the Exchange by member Proposed Rule Change and Timing for proceedings against the Exchange to litigants where such persons or entities Commission Action reimburse the Exchange for all costs do not prevail in the litigation. associated with defending such Legal proceedings can significantly Because the foregoing proposed rule proceedings, only when such persons or divert staff resources away from the change does not: (i) Significantly affect the protection entities do not prevail and the Exchange’s regulatory and business of investors or the public interest; Exchange’s costs exceed a specified purposes. In addition, these proceedings often require the Exchange to secure (ii) Impose any significant burden on amount. The text of the proposed rule competition; and outside counsel—a costly undertaking. change is below. Proposed new (iii) Become operative for 30 days The Exchange believes that establishing language is in italics. from the date on which it was filed, or a rule that may reduce non merit-based 11 17 CFR 200.30–3(a)(12). or vexatious legal proceedings against 7 See Securities Exchange Act Release Nos. 47842 1 15 U.S.C. 78s(b)(1). the Exchange by member litigants will (May 13, 2003), 68 FR 27114 (May 19, 2003)(SR– 2 17 CFR 240.19b–4. AMEX–2003–35); 37421 (July 11, 1996), 61 FR 3 15 U.S.C. 78s(b)(3)(A). 6 See e-mail from Jurij Trypupenko, Counsel and 37513 (July 18, 1996)(SR–CBOE–96–02); and 37563 4 17 CFR 240.19b–4(f)(6). Director of Litigation and Operations, Phlx, dated (August 14, 1996), 61 FR 43285 (August 21, 5 Phlx asked the Commission to waive the 30-day August 4, 2004, which clarifies that ‘‘the Board’’ 1996)(SR–PSE–96–21). operative delay. See Rule 19b–4(f)(6)(iii). 17 CFR refers to the Board of Governors of the Philadelphia 8 15 U.S.C. 78f(b). 240.19b–4(f)(6)(iii). Stock Exchange. 9 15 U.S.C. 78f(b)(5).
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such shorter time as the Commission amendments, all written statements a regional, multi-country, or cross- may designate, it has become effective with respect to the proposed rule border focus, but single-country pursuant to Section 19(b)(3)(A) of the change that are filed with the proposals will also be considered. Act 10 and Rule 19b–4(f)(6) Commission, and all written Proposals should center on groups that thereunder.11 At any time within 60 communications relating to the work with young people, and should days of the filing of the proposed rule proposed rule change between the design innovative, short-term, high change, the Commission may summarily Commission and any person, other than impact projects that promote mutual abrogate such rule change if it appears those that may be withheld from the understanding between people in the to the Commission that such action is public in accordance with the U.S. and people in South Asia and the necessary or appropriate in the public provisions of 5 U.S.C. 552, will be advancement of one or more of the interest, for the protection of investors, available for inspection and copying in following themes: excellence in or otherwise in furtherance of the the Commission’s Public Reference education, democracy enhancement, purposes of the Act. Section, 450 Fifth Street, NW., economic skills promotion, and conflict The Exchange requests that the Washington, DC 20549. Copies of such management. Commission waive the 30-day operative filing also will be available for In this competition, innovative design delay. The Commission believes inspection and copying at the principal for short-term, high-impact projects to waiving the 30-day operative delay is office of the Phlx. All comments pursue these themes effectively, and to consistent with the protection of received will be posted without change; do so with South Asian partner investors and the public interest. The the Commission does not edit personal organizations, will be important to Commission also notes that the identifying information from proposal competitiveness. Up to five proposed rule change is consistent with submissions. You should submit only grants may be awarded, and no award existing precedent and that there are no information that you wish to make will exceed $200,000. Public and novel issues. For these reasons, the available publicly. All submissions private non-profit organizations meeting Commission designates the proposal to should refer to File Number SR–Phlx– the provisions described in Internal be effective and operative upon filing 2004–47 and should be submitted on or Revenue Code section 26 U.S.C. with the Commission.12 before September 2, 2004. 501(c)(3) may submit proposals for the South Asia Professional Exchanges and IV. Solicitation of Comments For the Commission, by the Division of Training Program for Afghanistan, Market Regulation, pursuant to delegated Bangladesh, India, Pakistan and Sri Interested persons are invited to authority.13 submit written data, views, and Lanka. Margaret H. McFarland, arguments concerning the foregoing, I. Funding Opportunity Description including whether the proposed rule Deputy Secretary. change is consistent with the Act. [FR Doc. 04–18422 Filed 8–11–04; 8:45 am] Authority: Overall grant making Comments may be submitted by any of BILLING CODE 8010–01–P authority for this program is contained the following methods: in the Mutual Educational and Cultural Exchange Act of 1961, Public Law 87– Electronic Comments DEPARTMENT OF STATE 256, as amended, also known as the • Use the Commission’s Internet Fulbright-Hays Act. The purpose of the [Public Notice 4800] comment form (http://www.sec.gov/ Act is ‘‘to enable the Government of the rules/sro.shtml); or Bureau of Educational and Cultural United States to increase mutual • Send an e-mail to rule- Affairs (ECA) Request for Grant understanding between the people of [email protected]. Please include File Proposals: South Asia Professional the United States and the people of Number SR–Phlx–2004–47 on the Exchanges and Training Program for other countries * * *; to strengthen the ties which unite us with other nations subject line. Afghanistan, Bangladesh, India, by demonstrating the educational and Pakistan, and Sri Lanka Paper Comments cultural interests, developments, and • Send paper comments in triplicate Announcement Type: New Grant. achievements of the people of the to Jonathan G. Katz, Secretary, Funding Opportunity Number: ECA/ United States and other nations * * * Securities and Exchange Commission, PE/C/NEAAF–05–02. and thus to assist in the development of 450 Fifth Street, NW., Washington, DC Catalog of Federal Domestic friendly, sympathetic and peaceful 20549–0609. Assistance Number: 00.000. relations between the United States and All submissions should refer to File Application Deadline: October 7, the other countries of the world.’’ The Number SR–Phlx–2004–47. This file 2004. funding authority for the program above number should be included on the Summary: The South Asia/Near East/ is provided through legislation. Funding subject line if e-mail is used. To help the Africa Division of the Office of Citizen for this competition is being provided Commission process and review your Exchanges of the Bureau of Educational from FY–2004/FY–2005 Economic comments more efficiently, please use and Cultural Affairs (ECA), in Support Funds (ESF) transferred to the only one method. The Commission will cooperation with the South Asia Bureau Bureau of Educational and Cultural post all comments on the Commission’s of the U.S. Department of State, Affairs for obligation. Internet Web site (http://www.sec.gov/ announces an open competition for Purpose: ECA seeks proposals that rules/sro.shtml). Copies of the grants to support exchanges and will address one or more of four pillars submission, all subsequent relationship building between U.S. non- in the Department’s strategy for working profit organizations and civil society with South Asia: education, democracy, 10 15 U.S.C. 78s(b)(3)(A). groups in the following South Asian economic development, and conflict 11 17 CFR 240.19b–4(f)(6). countries: Afghanistan, Bangladesh, management. Proposals will be judged 12 For purposes only of accelerating the operative India, Pakistan, and Sri Lanka. ECA is more competitive if they present date of this proposal, the Commission has considered the proposed rule’s impact on most interested in projects which have convincingly innovative, short-term, efficiency, competition, and capital formation. 15 high-impact project designs, as the U.S.C. 78c(f). 13 17 CFR 200.30–3(a)(12). Bureau seeks new, expeditious and
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potentially more effective ways to and regional economic cooperation is workshops and seminars taking place in engage relevant audiences for these also of interest. the United States or overseas. Examples themes in the focal countries. Proposals • Conflict prevention, mitigation, of possible program activities include: should provide for travel between the reconciliation: Projects should bring 1. A U.S.-based program that includes U.S. and South Asia and for activities together young people from divided orientation to program purposes and to which will promote collaboration in communities in countries and/or U.S. society, study tour/site visits, planning and implementing projects of regions experiencing civil and professional internships/placements, common interest. Proposals should communal conflict. Small-scale projects interaction and dialogue, experiential target groups focused on youth, involving mock legislatures, training, and action plan development. including teachers, parents, religious volunteerism, student camps, mediation 2. Capacity-building and training-of- and community leaders and/or other training, civil society efforts or other trainer (TOT) workshops to help mentors. They should also reflect an projects that promote dialogue among participants identify priorities, create understanding of the related work of groups in conflict and coalitions among work plans, strengthen professional and various international agencies (e.g., U.S. divided communities are of interest. volunteer skills, share their experience Agency for International Development, Applicants should identify local with committed people within each World Bank, development foundations) organizations and individuals in the country, and become active in a so that the new projects complement, South Asian countries with which/ practical and valuable way. but do not duplicate, other programs. whom they are proposing to collaborate 3. Site visits and workshops by U.S. Proposals for countries and for themes and provide information regarding facilitators to monitor projects in the other than those listed here will not be previous cooperative programming and/ region and to provide additional eligible for consideration and will be or contacts. Information about the consultation and training as needed. declared technically ineligible. No counterpart organizations’ activities and Activities Ineligible for Support accomplishments should be included in guarantee is made or implied that grants The Office does not support proposals the section on institutional capacity. will be awarded in all categories. limited to conferences or seminars (i.e., Proposals must contain letters of Themes: one-to-fourteen-day programs with • commitment or support from the foreign Innovation in education: Projects plenary sessions, main speakers, panels, country partner organizations, and these might include the development of and a passive audience). It will support letters should be tailored to the project curricula, classroom pedagogy, parent/ conferences only when they are an being proposed. teacher/student associations, or the integral component of a larger project training of teachers and administrators Strong proposals usually have the following characteristics: that is receiving ECA funding from this to fit the needs of target schools and • competition. No funding is available communities. Target schools may be A demonstrable track record by the applicant of working in the proposed exclusively to send U.S. citizens to public and/or publicly-sanctioned conferences or conference-type seminars religious schools. Of particular interest issue area and countries; • Experienced staff with language overseas; nor is funding available for would be schools or activities that focus facility, where needed, and a bringing foreign nationals to on female students, as would projects commitment to monitor projects locally conferences or to routine professional that promote student problem solving to ensure implementation; association meetings in the United and critical thinking skills with an • A clear, convincing implementation States. The Office of Citizen Exchanges interactive pedagogy. Special attention plan showing how substantive results does not support academic research or might be given to preparing students for will be achieved as a result of the faculty or student fellowships. employment or for citizenship roles. activities funded by the grant; and Participant Selection: The winning Literacy projects for girls, their mothers • A plan that outlines activities that applicants MUST consult closely with and/or unemployed youth plus projects will take place after the ECA grant officers in the Public Affairs Sections of that seek to develop and disseminate concludes (follow-on). U.S. Embassies, as well as the ECA student-focused material in local The proposal narrative should clearly Office of Citizen Exchanges, during languages on citizenship and civic state the applicant’s commitment to program implementation. Embassy issues would also be of interest. consult closely with the Public Affairs officers must concur in the selection of • Democracy enhancement: Projects Section, and when required with other all participants nominated for the should promote youth awareness of and officers, at the U.S. Embassy in the focal program. involvement in civic and democratic countries. Applicants are encouraged to Security Considerations: Proposals processes, including respect for consult with U.S. Public Affairs Officers that include work in or with intellectual freedom, tolerance of in those countries before submitting Afghanistan or Pakistan should reflect diversity, accountability of government, proposals. Proposal narratives should an awareness of security conditions human rights, and inclusiveness of also state that all material developed for there and should demonstrate women and minorities. Small grants to the project will acknowledge ECA willingness to work closely with the community-based NGOs to promote Bureau funding for the program as well U.S. Embassies in Kabul or Islamabad to grassroots democracy, civic education as a commitment to invite schedule grant activities in accordance projects, and/or community health and representatives of the Embassy and/or with mission security guidelines. All development projects with a civic Consulate to participate in program travel to Afghanistan or Pakistan by U.S. education component will be sessions or site visits. Note that this will participants in this program must be considered. be a formal requirement in all final grant cleared in advance with the U.S. • Economic skills promotion: Projects awards. Embassies in Kabul or Islamabad and should encourage and help youth must be performed in accordance with develop skills for employment, Suggested Program Designs mission requirements. Itineraries, entrepreneurship, intelligent economic ECA-supported exchanges may details of local transportation and decisionmaking, and business include internships; study tours; short- housing, and names of visitors will be management. Integration of women and term, non-technical experiential submitted in advance for mission unemployed youth into local economies learning; and extended and intensive approval.
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Once projects are funded, ECA will IV. Application and Submission document for additional formatting and work with the grantees to solicit more Information technical requirements. detailed information on the needs and IV.3c. You must have nonprofit status interests of individual participants. Note: Please read the complete Federal with the IRS at the time of application. Register announcement before sending If your organization is a private II. Award Information inquiries or submitting proposals. Once the nonprofit which has not received a grant Type of Award: Grant. RFGP deadline has passed, Bureau staff may or cooperative agreement from ECA in Fiscal Year Funds: FY04–05. not discuss this competition with applicants the past three years, or if your Approximate Total Funding: until the proposal review process has been completed. organization received nonprofit status $800,000. from the IRS within the past four years, Approximate Number of Awards: IV.1. Contact Information To Request you must submit the necessary Four to five. an Application Package: Please contact documentation to verify nonprofit status Approximate Average Award: the Office of Citizen Exchanges, ECA/ as directed in the PSI document. Failure $170,000. PE/C/NEAAF, Room 216, U.S. to do so will cause your proposal to be Floor of Award Range: $ 55,000. Department of State, SA–44, 301 4th declared technically ineligible. Ceiling of Award Range: $200,000. Street, SW., Washington, DC 20547, IV.3d. Please take into consideration Anticipated Award Date: Pending Attention: South Asia Professional the following information when availability of funds, December 21, Exchanges Program, telephone (202) preparing your proposal narrative: 2004. IV.3d.1. Adherence to All Regulations Anticipated Project Completion Date: 619–5320, fax number (202) 619–4350, Governing the J Visa: The Office of While ECA is most interested in projects to request a Solicitation Package. Please Citizen Exchanges of the Bureau of that can be completed expeditiously, refer to the Funding Opportunity Educational and Cultural Affairs is the projects extending to December 31, Number ECA/PE/C/NEAAF–05–02 and official program sponsor of the exchange 2006, will be considered. program title located at the top of this announcement when making your program covered by this RFGP, and an III. Eligibility Information request. employee of the Bureau will be the III.1. Eligible applicants: Applications The Solicitation Package contains the ‘‘Responsible Officer’’ for the program may be submitted by public and private Proposal Submission Instructions (PSI) under the terms of 22 CFR part 62, non-profit organizations meeting the which include required application which covers the administration of the provisions described in Internal forms and standard guidelines for Exchange Visitor Program (J visa Revenue Code section 26 U.S.C. proposal preparation. program). Under the terms of 22 CFR 501(c)(3). IV.2. To Download a Solicitation part 62, organizations receiving grants III.2. Cost Sharing or Matching Funds: Package Via Internet: The entire under this RFGP will be third parties There is no minimum or maximum Solicitation Package may be ‘‘cooperating with or assisting the percentage required for this downloaded from the Bureau’s Web site sponsor in the conduct of the sponsor’s competition. However, the Bureau at http://exchanges.state.gov/education/ program.’’ The actions of grantee encourages applicants to provide rfgps/menu.htm. Please read all program organizations shall be maximum levels of cost sharing and information before downloading. ‘‘imputed to the sponsor in evaluating the sponsor’s compliance with’’ 22 CFR funding in support of its programs, and IV.3. Content and Form of amount of cost sharing offered will be part 62. Therefore, the Bureau expects Submission: Applicants must follow all that any organization receiving a grant one criterion in evaluating grant instructions in the Solicitation Package. proposals. under this competition will render all The original and ten copies of the assistance necessary to enable the When cost sharing is offered, it is application should be sent per the understood and agreed that the Bureau to fully comply with 22 CFR instructions under IV.3e. ‘‘Submission part 62 et seq. applicant must provide the amount of Dates and Times section’’ below. cost sharing as stipulated in its proposal The Bureau of Educational and IV.3a. Applicants are required to have and later included in an approved grant Cultural Affairs places great emphasis a Dun and Bradstreet Data Universal agreement. Cost sharing may be in the on the secure and proper administration form of allowable direct or indirect Numbering System (DUNS) number to of Exchange Visitor (J visa) Programs costs. For accountability, grantees must apply for a grant or cooperative and adherence by grantee program maintain written records to support all agreement from the U.S. Government. organizations and program participants costs which are claimed as This number is a nine-digit to all regulations governing the J visa contributions, as well as costs to be paid identification number which uniquely program status. Therefore, proposals by the Federal government. Such identifies business entities. Obtaining a should explicitly state in writing that the records are subject to audit. The basis DUNS number is easy and there is no applicant is prepared to assist the for determining the value of cash and charge. To obtain a DUNS number, Bureau in meeting all requirements in-kind contributions must be in access http:// governing the administration of accordance with OMB Circular A–110, www.dunandbradstreet.com or call 1– Exchange Visitor Programs as set forth (Revised), Subpart C.23—Cost Sharing 866–705–5711. Please ensure that your in 22 CFR part 62. If your organization and Matching. In the event the grantee DUNS number is included in the has experience as a designated does not provide the minimum amount appropriate box of the SF–424, Exchange Visitor Program Sponsor, the of cost sharing as stipulated in the ‘‘Application for Federal Assistance,’’ proposal should describe your record of approved budget, ECA’s contribution which is part of the formal application compliance with 22 CFR part 62 et seq., will be reduced in like proportion. package. including the oversight of Responsible III.3. Other Eligibility Requirements: IV.3b. All proposals must contain an Officers and Alternate Responsible Grants awarded to eligible executive summary, proposal narrative Officers, screening and selection of organizations with less than four years and budget. program participants, provision of pre- of experience in conducting Please Refer to the Solicitation arrival information and orientation to international exchange programs will be Package. It contains the mandatory participants, monitoring of participants, limited to $60,000. Proposal Submission Instructions (PSI) proper maintenance and security of
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forms, recordkeeping, reporting and behavior as a result of the program, and Please note: Consideration should be given other requirements. effects of the program on institutions to the appropriate timing of data collection The Office of Citizen Exchanges of (institutions in which participants work for each level of outcome. For example, ECA will be responsible for issuing DS– or partner institutions). The evaluation satisfaction is usually captured as a short- 2019 forms to participants in this plan should include indicators that term outcome, whereas behavior and institutional changes are normally program. measure gains in mutual understanding considered longer-term outcomes. A copy of the complete regulations as well as substantive knowledge. governing the administration of Successful monitoring and evaluation Overall, the quality of your Exchange Visitor (J) programs is depend heavily on setting clear goals monitoring and evaluation plan will be available at http://exchanges.state.gov and objectives at the outset of a judged on how well it (1) specifies or from: United States Department of program. Your evaluation plan should intended outcomes; (2) gives clear State, Office of Exchange Coordination include a description of project descriptions of how each outcome will and Designation, ECA/EC/ECD—SA–44, objectives, your anticipated project be measured; (3) identifies when Room 734, 301 4th Street, SW., outcomes, and how and when you particular outcomes will be measured; Washington, DC 20547, Telephone: intend to measure these outcomes and (4) provides a clear description of (202) 401–9810, FAX: (202) 401–9809. (performance indicators). The more that the data collection strategies for each IV.3d.2. Diversity, Freedom and objectives are ‘‘smart’’ (specific, outcome (i.e., surveys, interviews, or Democracy Guidelines: Pursuant to the measurable, attainable, results-oriented, focus groups). (Please note that Bureau’s authorizing legislation, and placed in a reasonable time frame), evaluation plans that deal only with the programs must maintain a non-political the easier it will be to conduct the first level of outcomes [satisfaction] will character and should be balanced and evaluation. You should also show how be deemed less competitive under the representative of the diversity of your project objectives link to the present evaluation criteria.) American political, social, and cultural program goals described in this RFGP. Grantees will be required to provide life. ‘‘Diversity’’ should be interpreted Your monitoring and evaluation plan reports analyzing their evaluation in the broadest sense and encompass should clearly distinguish between findings to the Bureau in their regular differences including, but not limited to, program outputs and outcomes. Outputs program reports. All data collected, ethnicity, race, gender, religion, are products and services delivered, including survey responses and contact geographic location, socio-economic often stated as an amount. Output information, must be maintained for a status, and disabilities. Applicants are information is important to show the minimum of three years and provided to strongly encouraged to adhere to the scope or size of project activities, but it the Bureau upon request. advancement of this principle both in cannot substitute for information about IV.3e. Please take the following program administration and in program progress towards outcomes or the information into consideration when content. Please refer to the review results achieved. Examples of outputs preparing your budget: criteria under the ‘Support for Diversity’ include the number of people trained or IV.3e.1. Applicants must submit a section for specific suggestions on the number of seminars conducted. comprehensive budget for the entire incorporating diversity into your Outcomes, in contrast, represent program. Awards may not exceed proposal. Public Law 104–319 provides specific results a project is intended to $200,000. There must be a summary that ‘‘in carrying out programs of achieve and are usually measured as an budget as well as breakdowns reflecting educational and cultural exchange in extent of change. Findings on outputs both administrative and program countries whose people do not fully and outcomes should both be reported, budgets. Applicants may provide enjoy freedom and democracy,’’ the but primary attention should be on separate sub-budgets for each program Bureau ‘‘shall take appropriate steps to outcomes. component, phase, location, or activity provide opportunities for participation We encourage you to assess the to provide clarification. in such programs to human rights and following four levels of outcomes, as IV.3e.2. Allowable costs for the democracy leaders of such countries.’’ they relate to the program goals set out program include the following: Public Law 106–113 requires that the in the RFGP (listed here in increasing (1) Travel. International and domestic governments of the countries described order of importance): airfare (per the ‘‘Fly America Act’’), above do not have inappropriate 1. Participant satisfaction with the ground transportation, and visas for U.S. influence in the selection process. program and exchange experience. participants. (J–1 visas for ECA- Proposals should reflect advancement of 2. Participant learning, such as supported participants from South Asia these goals in their program contents, to increased knowledge, aptitude, skills, to travel to the U.S. are issued at no the full extent deemed feasible. and changed understanding and charge.) IV.3d.3. Program Monitoring and attitude. Learning includes both (2) Per Diem. For U.S.-based Evaluation: Proposals must include a substantive (subject-specific) knowledge programming, organizations should use plan to monitor and evaluate the and mutual understanding. the published Federal per diem rates for project’s success, both as the activities 3. Participant behavior, concrete individual U.S. cities. Domestic per unfold and at the end of the program. actions to apply knowledge in work or diem rates may be accessed at: http:// The Bureau recommends that your community; greater participation and policyworks.gov/org/main/mt/ proposal include a draft survey responsibility in civic organizations; homepage/mtt/perdiem/perd03d.html. questionnaire or other data collection interpretation and explanation of For activities in South Asia, ECA techniques plus a description of a experiences and new knowledge gained; requests applicants to budget realistic methodology to link outcomes to continued contacts between costs that reflect the local economy and original project objectives and to project participants, community members, and never exceed Federal per diem rates. activities. The Bureau expects that the others. Foreign per diem rates can be accessed grantee will track participants or 4. Institutional changes, such as at: http://www.state.gov/m/a/als/prdm/ partners and be able to respond to key increased collaboration and html. evaluation questions, including partnerships, policy reforms, new (3) Interpreters. For U.S.-based satisfaction with the program, learning programming, and organizational activities, ECA strongly encourages as a result of the program, changes in improvements. applicants to hire their own locally-
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based interpreters. However, applicants equipment costs should be kept to a Please refer to the Solicitation may ask ECA to assign U.S. Department minimum. Costs for furniture are not Package for complete budget guidelines of State interpreters, which will allowed. and formatting instructions. decrease the amount of the award. 9. Working meal. Only one working IV.3f. Submission Dates and Times: Typically, one interpreter is provided meal may be provided during the Application Deadline Date: October 7, for every four visitors that require program. Per capita costs may not 2004. interpreting. When an applicant exceed $8 for a lunch and $20 for a Explanation of Deadlines: In light of proposes to use State Department dinner, excluding room rental, and recent events and heightened security interpreters, the following expenses lower costs are preferred. The number of measures, proposal submissions must be should be included in the budget: invited guests may not exceed sent via a nationally recognized Published Federal per diem rates (both participants by more than a factor of overnight delivery service (i.e., DHL, ‘‘lodging’’ and ‘‘M&IE’’; ‘‘home-program- two-to-one. Interpreters must be Federal Express, UPS, Airborne Express, home’’ transportation in the amount of included as participants. or U.S. Postal Service Express Overnight $400 per interpreter; reimbursement for 10. Return travel allowance. A return Mail, etc.) and be shipped no later than taxi fares; and cell phone usage at $10 travel allowance of $70 for each foreign the above deadline. The delivery per week. Salary expenses for State participant may be included in the services used by applicants must have Department interpreters will be covered budget. This allowance may be used for in-place, centralized shipping by the Bureau and should not be part of incidental expenses incurred during identification and tracking systems that an applicant’s proposed budget. Bureau international travel. may be accessed via the Internet and funds cannot support interpreters who 11. Health Insurance. Foreign delivery people who are identifiable by accompany delegations from their home participants will be covered during their commonly recognized uniforms and country or travel internationally. participation in the program by the delivery vehicles. Proposals shipped on 4. Book and Cultural Allowances. ECA-sponsored Accident and Sickness or before the above deadline but Foreign participants are entitled to a Program for Exchanges (ASPE), for received at ECA more than seven days one-time cultural allowance of $150 per which the grantee must enroll them. after the deadline will be ineligible for person, plus a book allowance of $50. Details of that policy can be provided by further consideration under this Interpreters should be reimbursed up to the contact officers identified in this competition. Proposals shipped after the $150 for expenses when they escort solicitation. The premium is paid by established deadlines are ineligible for participants to cultural events. U.S. ECA and should not be included in the consideration under this competition. It program staff, trainers or participants grant proposal budget. However, is each applicant’s responsibility to are not eligible to receive these benefits. applicants are permitted to include ensure that each package is marked with 5. Consultants. Consultants may be costs for travel insurance for U.S. a legible tracking number and to used to provide specialized expertise or participants in the budget. monitor/confirm delivery to ECA via the to make presentations. Honoraria rates 12. Wire transfer fees. When Internet. ECA will not notify you upon should not exceed $250 per day. necessary, applicants may include costs receipt of application. Delivery of Organizations are encouraged to cost- to transfer funds to partner proposal packages may not be made via share rates that would exceed that organizations overseas. Grantees are local courier service or in person for this figure. Subcontracting organizations urged to research applicable taxes that competition. Faxed documents will not may also be employed, in which case may be imposed on these transfers by be accepted at any time. Only proposals the written agreement between the host governments. submitted as stated above will be prospective grantee and subcontractor 13. In-country travel costs for visa considered. Applications may not be should be included in the proposal. processing purposes. Given the submitted electronically at this time. Such subcontracts should detail the requirements associated with obtaining Applicants must follow all division of responsibilities and J–1 visas for ECA-supported instructions in the Solicitation Package. participants, applicants should include proposed costs, and subcontracts should Important Note: When preparing your be itemized in the budget. costs for participant and/or in-country submission please make sure to include one 6. Room rental should not exceed partner travel to U.S. embassies or extra copy of the completed SF–424 $250 per day, or any excess should be consulates for these purposes. E.g., Application For Federal Assistance form and cost shared. Afghan participants may have to travel place it in an envelope addressed to ‘‘ECA/ 7. Materials development. Proposals to Islamabad more than once to be EX/PM’’. may contain costs to purchase, develop interviewed and to pick up their visas. The original and ten copies of the and translate materials for participants. 14. Administrative Costs. Costs application should be sent to: U.S. ECA strongly discourages the use of necessary for the effective Department of State, SA–44, Bureau of automatic translation software for the administration of the program may Educational and Cultural Affairs,Ref.: preparation of training materials or any include salaries for grantee organization ECA/PE/C/NEAAF–05–02, Program information distributed to the group of employees, benefits, and other direct Management, ECA/EX/PM, Room 534, participants or network of organizations. and indirect costs per detailed 301 4th Street, SW., Washington, DC Costs for high quality translation of instructions in the Application Package. 20547. materials should be anticipated and While there is no rigid ratio of Along with the Project Title, all included in the budget. Grantee administrative to program costs, applicants must enter the above organizations should expect to submit a proposals in which the administrative Reference Number in Box 11 on the SF– copy of all program materials to ECA, costs do not exceed 25% of the total 424 contained in the mandatory and ECA support should be requested ECA grant funds will be rated Proposal Submission Instructions (PSI) acknowledged on all materials more highly on cost effectiveness (See of the solicitation document. developed with its funding. Review Criterion #10.). Proposals IV.3g. Intergovernmental Review of 8. Equipment. Proposals may include should show strong administrative cost- Applications: Executive Order 12372 limited costs to purchase equipment for sharing contributions from the does not apply to this program. South Asia-based programming such as applicant, the in-country partner and Applicants must also submit the computers and fax machines, but other sources. ‘‘Executive Summary’’ and ‘‘Proposal
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Narrative’’ sections of the proposal in venue and program evaluation) and receive positive assessments by the U.S. text (.txt) format on a PC-formatted disk. program content (orientation and wrap- Department of State’s geographic area The Bureau will provide these files up sessions, program meetings, resource desk and overseas officers of program electronically to the appropriate Public materials and follow-up activities). need, potential impact, and significance Affairs Section(s) at the U.S. 6. Institutional Capacity: Proposed in the partner country(ies). embassy(ies) for its(their) review. personnel and institutional resources should be adequate and appropriate to VI. Award Administration Information V. Application Review Information achieve the program or project’s goals. VI.1. Award Notices 7. Institution’s Record: Proposals V.1. Review Process Final awards cannot be made until should demonstrate an institutional funds have been appropriated by The Bureau will review all proposals record of successful exchange programs, Congress, allocated and committed for technical eligibility. Proposals will including responsible fiscal through internal Bureau procedures. be deemed ineligible if they do not fully management and full compliance with Successful applicants will receive an adhere to the guidelines stated herein all reporting requirements for past and in the Solicitation Package. The Bureau grants as determined by Bureau Assistance Award Document (AAD) program office, as well as the Public Grants Staff. The Bureau will consider from the Bureau’s Grants Office. The Diplomacy section overseas, where the past performance of prior recipients AAD and the original grant proposal appropriate, will review all eligible and the demonstrated potential of new with subsequent modifications (if proposals. Eligible proposals will be applicants. applicable) shall be the only binding subject to compliance with Federal and 8. Follow-on Activities: Proposals authorizing document between the Bureau regulations and guidelines and should provide a plan for continued recipient and the U.S. Government. The forwarded to Bureau grant panels for follow-on activity (without Bureau AAD will be signed by an authorized advisory review. Proposals may also be support) ensuring that ECA-supported Grants Officer, and mailed to the reviewed by the Office of the Legal programs are not isolated events. recipient’s responsible officer identified Adviser or by other Department 9. Project Evaluation: Proposals in the application. elements. Final funding decisions are at should include a plan to evaluate the Unsuccessful applicants will receive the discretion of the Department of activity’s success, both as the activities notification of the results of the State’s Assistant Secretary for unfold and at the end of the program. application review from the ECA Educational and Cultural Affairs. Final ECA recommends submission of draft program office coordinating this technical authority for grants resides survey questionnaires or other data competition. with the Bureau’s Grants Officer. collection techniques plus description VI.2. Administrative and National Review Criteria of a methodology to use to link Policy Requirements outcomes to original project objectives Terms and Conditions for the Technically eligible applications will and project activities. ECA also Administration of ECA agreements be competitively reviewed according to recommends employment of an expert, the criteria stated below. These criteria include the following: independent evaluator and final impact Office of Management and Budget are not rank ordered and all carry equal evaluation conducted six months after weight in the proposal evaluation: Circular A–122, ‘‘Cost Principles for the end of other program activities. Nonprofit Organizations.’’ 1. Quality of the program idea: Although some exchange project Proposals should exhibit originality, Office of Management and Budget objectives may be difficult to quantify, Circular A–21, ‘‘Cost Principles for substance, precision, and relevance to ECA urges applicants to identify the purposes stated in this Request for Educational Institutions.’’ indicators and observational techniques OMB Circular A–87, ‘‘Cost Principles Grant Proposals. Note the call for to associate with all objectives so that for State, Local and Indian innovative, short-term, high-impact program progress and outcome can be Governments’’. designs. objectively reported. Overall, an OMB Circular No. A–110 (Revised), 2. Program planning: Detailed agenda evaluation plan will be judged more Uniform Administrative Requirements and relevant work plan should satisfactory the more that it specifies (a) for Grants and Agreements with demonstrate substantive undertakings a distinct population with which to Institutions of Higher Education, and logistical capacity over a work, (b) a manageable set of ‘‘smart’’ Hospitals, and other Nonprofit progressive time line. Agenda and plan objectives on a time line for that Organizations. should adhere to the program overview population, (c) clear descriptions of OMB Circular No. A–102, Uniform and guidelines described above. performance indicators for each Administrative Requirements for 3. Ability to achieve program objective, (d) measurement tools for Grants-in-Aid to State and Local objectives: Objectives should be clearly collecting data, (e) a methodology for Governments. stated (see section on monitoring and aggregating observations, and (f) OMB Circular No. A–133, Audits of evaluation above) in terms that allow inference strategies for interpreting data. States, Local Government, and Non- linkage with program activities. 10. Cost-effectiveness: The overhead profit Organizations. 4. Multiplier effect/impact: Proposed and administrative components of the Please reference the following Web programs should strengthen long-term proposal, including salaries and sites for additional information: mutual understanding, including honoraria, should be kept as low as http://www.whitehouse.gov/omb/grants; maximum sharing of information and possible. All other items should be http://exchanges.state.gov/education/ establishment of long-term institutional necessary and appropriate. grantsdiv/terms.htm#articleI. and individual linkages. 11. Cost-sharing: Proposals should 5. Support of Diversity: Proposals maximize cost-sharing through other VI.3. Reporting Requirements should demonstrate substantive support private sector support as well as You must provide ECA with a hard of the Bureau’s policy on diversity. institutional direct funding and in-kind copy original plus one copy of the Achievable and relevant features should contributions. following reports: be cited in both program administration 12. Value to U.S.-Partner Country a. A final program that includes the (selection of participants, program Relations: Proposed projects should overall program evaluation and a final
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financial report no more than 90 days VIII. Other Information comments, contact Gloria Blue, after the expiration of the award; Executive Secretary, TPSC, Office of the Notice b. Quarterly financial reports; and USTR, 1724 F Street, NW., Washington, The terms and conditions published DC 20508, telephone (202) 395–3475. c. Program reports after each major in this RFGP are binding and may not Questions concerning the expansion of phase of activity, e.g., after each be modified by any Bureau the list of pharmaceutical products international travel phase. representative. Explanatory information receiving zero duties should be Grantees will be required to provide provided by the Bureau that contradicts addressed to Sarah Bovim or Jean reports analyzing their evaluation published language will not be binding. Janicke, Director, Market Access, USTR findings to the Bureau in their regular Issuance of the RFGP does not (202) 395–4994. program reports. Please refer to constitute an award commitment on the SUPPLEMENTARY INFORMATION: The Application and Submission part of the Government. The Bureau Chairman of the TPSC invites written Instructions (IV.3.d.3) above for Program reserves the right to reduce, revise, or comments from the public on the Monitoring and Evaluation information. increase proposal budgets in accordance expansion of the list of pharmaceutical with the needs of the program and the All data collected, including survey products receiving duty-free treatment availability of funds. Awards made will responses and contact information, must from certain members of the World be subject to periodic reporting and be maintained for a minimum of three Trade Organization (WTO), specifically evaluation requirements per section VI.3 years and provided to the Bureau upon additions to the lists of pharmaceutical above. request. active ingredients; prefixes and suffixes Notification: Final awards cannot be that could be associated with an active All reports must be sent to the ECA made until funds have been Grants Officer and ECA Program Officer ingredient in order to designate its salt, appropriated by Congress, allocated and ester or hydrate form; or chemical listed in the final assistance award committed through internal ECA Bureau document. intermediates intended for the procedures. manufacture of pharmaceutical active VI.4. Program Data Requirements Dated: August 6, 2004. ingredients. Negotiations will begin in C. Miller Crouch, 2004 in the WTO with a view to adding Organizations awarded grants will be Principal Deputy Assistant Secretary, Bureau new pharmaceuticals to the zero duty required to maintain specific data on of Educational and Cultural Affairs, list. Any amendments to the list of program participants and activities in an Department of State. pharmaceuticals will be subject to electronically accessible database format [FR Doc. 04–18456 Filed 8–11–04; 8:45 am] approval by all participants in the that can be shared with the Bureau as BILLING CODE 4710–05–P negotiations. A copy of the initial list of requested. As a minimum, the data must proposed items is available on the USTR include the following: Web site at: http://www.ustr.gov. (a) Name, address, contact OFFICE OF THE UNITED STATES 1. Background Information information and biographic sketch of all TRADE REPRESENTATIVE persons who travel internationally on During the Uruguay Round of funds provided by the grant. Trade Policy Staff Committee; Public multilateral trade negotiations, the (b) Itineraries of international and Comments for Multilateral Negotiations United States and 16 trading partners domestic travel, providing dates of in the World Trade Organization on agreed to the reciprocal elimination of travel and cities in which any exchange Expansion of the List of duties on approximately 7,000 experiences take place. Final schedules Pharmaceutical Products Receiving pharmaceutical products and chemical for in-country and U.S. activities must Zero Duties intermediates on January 1, 1995. be received by the ECA Program Officer Participants also agreed to periodically AGENCY: Office of the United States update the zero duty list of at least three work days prior to the Trade Representative. official opening of the activity. pharmaceuticals. As a result of ACTION: Notice and request for multilateral negotiations in the WTO VII. Agency Contacts comments. during 1996 and again in 1998, the United States and other participants in SUMMARY: The Trade Policy Staff For questions about this the negotiations eliminated duties on an Committee (TPSC) is requesting written announcement, contact: Katherine Van additional 750 international public comments with respect to the de Vate ((202) 619–5320, nonproprietary names (INNs) and expansion of the list of pharmaceuticals [email protected]) or Thomas chemical intermediates on April 1, subject to reciprocal duty elimination by Johnston ((202) 619–5325, 1997, and on an additional 630 such certain members of the World Trade [email protected]), room 216, Office products on July 1, 1999. Organization (WTO). The specific of Citizen Exchanges, ECA/PE/C/ The Pharmaceutical Appendix to the information being sought is described in NEAAF, U.S. Department of State, SA– Harmonized Tariff Schedule of the the background section below. 44, 301 Fourth Street, SW., Washington, United States (HTSUS) enumerates the DC 20547. All correspondence with the DATES: Public comments are due by products and chemical intermediates Bureau concerning this RFGP should noon, September 17, 2004. that are eligible to enter free of duty as reference the above title and number ADDRESSES: Office of the U.S. Trade a result of the Uruguay Round zero for ECA/PE/C/NEAAF–05–02. Representative, 600 17th Street, NW., zero agreement on pharmaceuticals and Please read the complete Federal Washington, DC 20508. Submissions by the subsequent updates by WTO Register announcement before sending electronic mail: [email protected]. members. The HTSUS can be purchased inquiries or submitting proposals. Once Submissions by facsimile: Gloria Blue, from the United States Government the RFGP deadline has passed, Bureau Executive Secretary, Trade Policy Staff Printing Office. An electronic version of staff may not discuss this competition Committee, at (202) 395–6143. the HTSUS can be found at http:// with applicants until the proposal FOR FURTHER INFORMATION CONTACT: For www.usitc.gov. The Pharmaceutical review process has been completed. procedural questions concerning public Appendix of the HTSUS consists of
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three tables. Table 1 lists active ingredient. A suggested format for and the file name of the public version pharmaceutical ingredients and dosage- presenting this information is presented should begin with the characters ‘‘P-’’. form products by their International below. In addition, submissions of The ‘‘P-’’ or ‘‘BC-’’ should be followed Nonproprietary Names (INNs) from the chemical intermediates must by the name of the submitter. Persons World Health Organization (WHO). demonstrate that the product meets the who make submissions by e-mail should Table 1 currently includes INNs from following conditions: (1) The chemical not provide separate cover letters; WHO lists 1–78. Prefixes and suffixes is a sole-pharmaceutical use information that might appear in a cover that could be associated with the INNs intermediate; (2) some portion of the letter should be included in the in Table 1, potentially resulting in intermediate is incorporated in the final submission itself. To the extent multiple permutations in derivatives, active ingredient molecule, and (3) the possible, any attachments to the are enumerated in Table 2. Chemical intermediate is used in producing an submission should be included in the intermediates intended for the active ingredient that has reached at same file as the submission itself, and manufacture of pharmaceuticals are least Phase III of clinical trials of the not as separate files. listed in Table 3. The interagency TPSC Food and Drug Administration (or other Written comments submitted in committee, led by USTR and with input national equivalent). Comments response to this request will be placed from appropriate industry association pertaining to the additions to the list of in a file open to public inspection and private sector advisory groups, is in prefixes or suffixes for salt, ester or pursuant to 15 CFR 2003.5, except the process of preparing negotiating hydrate forms of an INN active business confidential information positions. Comments are requested for ingredient should state a rationale for exempt from public inspection in pharmaceutical items which would be the nomination. Only comments accordance with 15 CFR 2003.6. in the interest of the United States to containing all of the above information Business confidential information add to the existing WTO zero for zero will be considered in developing U.S. submitted in accordance with 15 CFR agreement. positions for the negotiations. 2003.6 must be clearly marked ‘‘Business Confidential’’ at the top of Negotiators will be reviewing the 2. Requirements for Submissions INNs on the most recent WHO lists (i.e., each page, including any cover letter or lists 79–90) in this latest review cycle. In order to facilitate prompt cover page, and must be accompanied Comments pertaining to the processing of submissions, USTR by a nonconfidential summary of the pharmaceutical active ingredients strongly urges and prefers electronic (e- confidential information. All public covered by these lists need only provide mail) submissions in response to this documents and nonconfidential the INN name and reference the notice. summaries shall be available for public appropriate WHO list. Otherwise, the Persons making submissions by e- inspection in the USTR Reading Room. following information must be supplied mail should use the following subject The USTR Reading Room is open to the for each pharmaceutical active line: ‘‘Expansion of the List of public, by appointment only, from 10 ingredient or chemical intermediate to Pharmaceutical Products Receiving Zero a.m. to 12 noon and 1 p.m. to 4 p.m., provide the technical basis for Duties’’ followed by ‘‘Written Monday through Friday. An reviewing the submissions: (1) The Comments.’’ Documents should be appointment to review the file must be precise chemical name; (2) the Chemical submitted as either WordPerfect, scheduled at least 48 hours in advance Abstracts Service (CAS) registry MSWord, or text (.txt) files. Supporting and may be made by calling (202) 395– number; (3) a diagram of the molecular documentation submitted as 6186. structure; and (4) the six-digit spreadsheets are acceptable as Quattro General information concerning the Harmonized System classification Pro or Excel. More detailed information Office of the United States Trade number. Submissions of chemical regarding the content of the submissions Representative may be obtained by intermediates also must provide the INN is listed below. accessing its Internet Web site (http:// and chemical name of the active For any document containing www.ustr.gov). ingredient into which it is incorporated, business confidential information Carmen Suro-Bredie, the CAS number of this active submitted electronically, the file name ingredient, and a diagram of the of the business confidential version Chair, Trade Policy Staff Committee. molecular structure of this active should begin with the characters ‘‘BC-’’, Suggested format for submissions:
HS code (6-digit) CAS number Chemical name (e.g., chemical abstracts index name)
Molecular structure:
For all chemical intermediates, the into which the intermediate is following information is provided on incorporated: the pharmaceutical active ingredient
INN of active ingredient CAS number of active ingredient Chemical name of active ingredient
Molecular structure of active ingredient:
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[FR Doc. 04–18424 Filed 8–11–04; 8:45 am] FOR FURTHER INFORMATION CONTACT: Jay participate in the dispute as third BILLING CODE 3190–WH–P T. Taylor, Assistant General Counsel, parties. Office of the United States Trade Japan’s new measures retain almost Representative, 600 17th Street, NW., all of the phytosanitary restrictions of OFFICE OF THE UNITED STATES Washington, DC 20508, (202) 395–3150. the original measure, which was found TRADE REPRESENTATIVE SUPPLEMENTARY INFORMATION: Section by the Appellate Body and Panel to be 127(b) of the Uruguay Round inconsistent with Japan’s obligations [Docket No. WTO/DS–245] Agreements Act (‘‘URAA’’) (19 U.S.C. under the SPS Agreement. The § 3537(b)(1)) requires that notice and restrictions include: the prohibition of WTO Dispute Settlement Proceeding opportunity for comment be provided imported apples other than those Regarding Japanese Measures after the United States submits or produced in designated orchards in the Affecting the Importation of Apples receives a request for the establishment U.S. States of Washington and Oregon; of a WTO dispute settlement panel. If a the prohibition of imported apples from AGENCY: Office of the United States dispute settlement panel is established orchards in which any fire blight is Trade Representative. pursuant to the WTO Understanding on detected; the prohibition of imported ACTION: Notice; request for comments. Rules and Procedures Governing the apples from any orchard (whether or not Settlement of Disputes (DSU), the panel, it is free of fire blight) should fire blight SUMMARY: The Office of the United which would hold its meetings in be detected in a ‘‘buffer zone’’ States Trade Representative (‘‘USTR’’) is Geneva, Switzerland, would be surrounding the orchard; the providing notice that on July 30, 2004, expected to issue a report on its findings requirement that export orchards be at the request of the United States, the and recommendations within inspected for the presence of fire blight Dispute Settlement Body (DSB) of the approximately three months of the date for purposes of applying the above- World Trade Organization (WTO) it is established. mentioned prohibitions; a post-harvest established a dispute settlement panel surface treatment of exported apples under the Marrakesh Agreement Prior WTO Proceedings with chlorine; production requirements, Establishing the WTO to examine On December 10, 2003, the WTO DSB such as chlorine treatment of the whether Japan has implemented the adopted the reports of a dispute interior of the packing facility; post- recommendations and rulings of the settlement panel and the WTO harvest separation of apples for export DSB in a dispute involving Japanese Appellate Body in a dispute brought by to Japan from those apples for other phytosanitary measures restricting the the United States challenging Japanese destinations; a requirement that U.S. importation of U.S. apples. Japan phytosanitary restrictions on the import plant protection officials certify or justifies the measures as relating to the of U.S. apples in connection with fire declare that the apples are free of plant disease fire blight and the fire blight or the fire blight-causing quarantine pests, not infected/infested blight-causing organism, Erwinia organism, Erwinia amylovora. The panel with fire blight, and have been treated amylovora. On December 10, 2003, the found, and the Appellate Body with chlorine; and a requirement that DSB adopted the findings of the panel confirmed, that Japan’s restrictions were Japanese officials confirm that the and Appellate Body in this proceeding, not consistent with its obligations under certification, orchard designation and which found that Japan’s apple import the SPS Agreement. The DSB chlorine treatment have been properly regime was maintained in breach of recommended that Japan revise its administered and inspect the various provisions of the WTO measure accordingly. The dispute disinfestation and packing facilities. Agreement on the Application of settlement panel and Appellate Body The United States believes that Japan’s Sanitary and Phytosanitary Measures reports are publicly available in the revised measures are inconsistent with (‘‘SPS Agreement’’). Japan issued USTR reading room and on the WTO Articles 2.2, 2.3, 5.1, 5.2, 5.3, 5.5, 5.6, revised measures on June 30, 2004 in Web site http://www.wto.org. 6.1 and 6.2 of the SPS Agreement, response to the DSB’s recommendations Article XI of the General Agreement on Article 21.5 Proceeding and rulings. The United States Tariffs and Trade 1994 and Article 4.2 subsequently requested the The United States and Japan agreed of the Agreement on Agriculture. establishment of the dispute settlement that Japan would have until June 30, 2004 as the reasonable period of time to Public Comment: Requirements for panel because it believes that Japan’s Submissions revised measures do not comply with implement the DSB’s recommendations the DSB’s recommendations and rulings and rulings. The United States and Interested persons are invited to or the SPS Agreement. USTR invites Japan met several times during that submit written comments concerning written comments from the public period in an attempt to reach an the issues raised in this dispute. Persons concerning the issues raised in this agreement regarding Japan’s restrictions submitting comments may either send dispute. on U.S. apples, but were unable to agree one copy by fax to Sandy McKinzy at on a satisfactory result. Japan issued (202) 395–3640, or transmit a copy DATES: Although USTR will accept any revised measures on June 30, which the electronically to [email protected], with comments received during the course of United States believes fail to comply ‘‘Japan Apples (DS245)’’ in the subject the dispute settlement proceedings, with the DSB’s recommendations and line. For documents sent by fax, USTR comments should be submitted on or rulings and the SPS Agreement. requests that the submitter provide a before September 1, 2004 to be assured Accordingly, the United States confirmation copy to the electronic mail of timely consideration by USTR. requested the establishment of an address listed above. ADDRESSES: Comments should be Article 21.5 compliance panel to USTR encourages the submission of submitted (i) electronically, to determine the WTO-consistency of documents in Adobe PDF format, as [email protected], Attn: ‘‘Japan Apples’’ Japan’s revised measures. The DSB attachments to an electronic mail. in the subject line, or (ii) by fax, to established the panel on July 30, 2004. Interested persons who make Sandy McKinzy at (202) 395–3640, with The European Communities, New submissions by electronic mail should a confirmation copy sent electronically Zealand, Chinese Taipei, and Australia not provide separate cover letters; to the email address above. have indicated their interest to information that might appear in a cover
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letter should be included in the DEPARTMENT OF TRANSPORTATION Algeria r1. Intended effective date: 15 submission itself. Similarly, to the August 2004. extent possible, any attachments to the Office of the Secretary Andrea M. Jenkins, submission should be included in the same file as the submission itself, and Aviation Proceedings, Agreements Program Manager, Docket Operations, Federal Register Liaison. not as separate files. Filed the Week Ending July 30, 2004 [FR Doc. 04–18484 Filed 8–11–04; 8:45 am] A person requesting that information The following Agreements were filed BILLING CODE 4910–62–P contained in a comment submitted by with the Department of Transportation that person be treated as confidential under the provisions of 49 U.S.C. business information must certify that sections 412 and 414. Answers may be DEPARTMENT OF TRANSPORTATION such information is business filed within 21 days after the filing of confidential and would not customarily the application. Federal Transit Administration be released to the public by the Docket Number: OST–2004–18732. submitter. Date Filed: July 26, 2004. Addendum to Preparation of an Confidential business information Environmental Impact Statement for a must be clearly designated as such and Parties: Members of the International Air Transport Association. Proposed Transit Improvement Project the submission must be marked in Branson, MO ‘‘BUSINESS CONFIDENTIAL’’ at the top Subject: PTC12 USA–EUR Fares 0091 dated 27 July 2004. Resolution 015h— and bottom of the cover page and each AGENCY: Federal Transit Administration succeeding page of the submission. USA Add-ons between USA and UK. Intended effective date: 1 October 2004. (FTA), U.S. Department of Information or advice contained in a Transportation (DOT). comment submitted, other than business Docket Number: OST–2004–18762. confidential information, may be Date Filed: July 29, 2004. ACTION: Notice of revised public meeting determined by USTR to be confidential Parties: Members of the International date supporting the notice of intent to in accordance with section 135(g)(2) of Air Transport Association. prepare an environmental impact the Trade Act of 1974 (19 U.S.C. Subject: PTC COMP 1165 dated 30 statement 2155(g)(2)). If the submitting person July 2004. Composite Expedited believes that information or advice may Resolutions 024d and 024e r1–r2. SUMMARY: FTA is issuing this notice to qualify as such, the submitting person— Intended effective date: 1 September advise the public and agencies that the (1) Must clearly so designate the 2004. open-house public scoping meeting for information or advice; Docket Number: OST–2004–18763. the Environmental Impact Statement (2) Must clearly mark the material as Date Filed: July 29, 2004. (EIS) on a proposed transit improvement ‘‘SUBMITTED IN CONFIDENCE’’ at the Parties: Members of the International project in Branson, Missouri has been top and bottom of each page of the cover Air Transport Association. rescheduled. page and each succeeding page; and Subject: PTC COMP 1166 dated 30 DATES: Public Scoping Meeting: A public (3) Is encouraged to provide a non- July 2004. Composite Expedited open-house meeting is scheduled from 4 confidential summary of the Resolution 002tt r4. Intended effective to 7 pm on Monday, August 30, 2004, information or advice. date: 1 November 2004. Pursuant to section 127(e) of the at the Branson City Hall Municipal Docket Number: OST–2004–18767. Courtroom (110 West Maddux Street, URAA (19 U.S.C. 3537(e)), USTR will Date Filed: July 30, 2004. maintain a file on this dispute Branson, MO) in lieu of the originally Parties: Members of the International scheduled June 29 open-house meeting. settlement proceeding, accessible to the Air Transport Association. public, in the USTR Reading Room, (The new meeting date will be Subject: PTC2 EUR 0576 dated 30 July advertised locally.) Oral and written which is located at 1724 F Street, NW., 2004. Mail Vote 399—Resolution 010q. Washington, DC 20508. The public file comments may be made at this session. TC2 Within Europe, Europe-Africa, Project staff from the City of Branson will include non-confidential comments Europe-Middle East Special. Passenger received by USTR from the public with will be available for informational Amending Resolution from Algeria r1. discussion and to answer questions. The respect to the dispute; if a dispute Intended effective date: 15 August 2004. settlement panel is convened, the U.S. following information will be presented submissions to that panel, the Docket Number: OST–2004–18768. at the Open-house meeting: The study- submissions, or non-confidential Date Filed: July 30, 2004. area boundary; the study schedule; the summaries of submissions, to the panel Parties: Members of the International public involvement plan; the problem received from other participants in the Air Transport Association. statement; the project purpose and need; Subject: PTC2 EUR–AFR 0207 dated dispute, as well as the report of the the study goals and objectives; 30 July 2004. Mail Vote 399—Resolution panel; and, if applicable, the report of effectiveness measures, as well as the 010q. TC2 Within Europe, Europe- the Appellate Body. An appointment to alternatives currently proposed to be Africa, Europe-Middle East Special. review the public file (Docket No. WT/ considered in the study. Input will be Passenger Amending Resolution from DS–245, Japan—Apples) may be made solicited to focus the environmental Algeria r1. Intended effective date 15 by calling the USTR Reading Room at investigations. The meeting location is August 2004. (202) 395–6186. The USTR Reading accessible to individuals with Room is open to the public from 9:30 Docket Number: OST–2004–18769. disabilities. Individuals with special a.m. to noon and 1 p.m. to 4 p.m., Date Filed: July 30, 2004. needs should contact Cheryl Ford, Monday through Friday. Parties: Members of the International Engineering Department; City of Air Transport Association. Branson, Missouri at (417) 337–8559. Daniel E. Brinza, Subject: PTC2 EUR–ME 0190 dated 30 Comment Due Date: Written comments Assistant United States Trade Representative July 2004. Mail Vote 399—Resolution on the scope of the EIS should be sent for Monitoring and Enforcement. 010q. TC2 Within Europe, Europe- to the Branson City Engineer as [FR Doc. 04–18457 Filed 8–11–04; 8:45 am] Africa, Europe-Middle East Special. indicated in ADDRESSES below by BILLING CODE 3190–W4–P Passenger Amending Resolution from September 30, 2004.
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ADDRESSES: Written comments on the multiple overhead utilities situated the Endangered Species Act, and project scope should be forwarded to: adjacent to intensive development. Only Section 4(f) of the DOT Act, will be Joni Roeseler, Project Manager, Federal a handful of signalized intersections addressed. In addition, the FTA New Transit Administration, Region VII, 901 exist along the strip, complicating the Starts regulation (49 CFR part 611) will Locust Street, Room 404, Kansas City, ability of pedestrians to get across the be applied, which requires the Missouri 64106; Telephone: (816) 329– street. Options are limited to further submission of specific information to 3936; e-mail: [email protected]; expand the roadway network to address FTA from the grant applicant to support or: David Miller, City Engineer, City of the considerable traffic congestion that an FTA decision on initiating Branson, 110 West Maddux Street, Suite remains on the Strip from single- preliminary engineering. 310, Branson, Missouri 65616; occupant autos and tour buses. No Comments and suggestions are invited Telephone: (417) 337–8559; e-mail: public transit service is currently from all interested parties to assist in [email protected]. available in the corridor. The problem is addressing the full range of alternatives expected to grow worse over time as FOR FURTHER INFORMATION CONTACT: If and to identify any significant potential venues continue to grow in popularity additional information is needed, project impacts. In addition, a public and as more venues are added. hearing will be held after the draft EIS contact the FTA or the City of Branson Transit needs will be evaluated in this personnel identified in ADDRESSES has been circulated for public and corridor to address the congestion agency review and comment. Comments above. You can also visit the City of problems along the Strip. The study area Branson Web site at http:// or questions concerning the proposed involves a roughly ten-mile-long action and the scope of the EIS should www.branson.com where a project page corridor. It is generally bounded: on the will be established by the time of the be directed to the FTA as described in north by the Red Route west of Roark ADDRESSES above. open-house meeting. Creek and the Missouri and North Scoping Package: An information Arkansas railroad east of Roark Creek; Issued on August 6, 2004. packet, referred to as the Scoping on the east by the rail line; on the south Mokhtee Ahmad, Booklet, will be distributed to interested by parkland paralleling Lake FTA Regional Administrator. individuals upon request and will be Taneycomo and the Yellow Route; and [FR Doc. 04–18486 Filed 8–11–04; 8:45 am] available at the meeting. (Copies of the on the west by the Taney/Stone County BILLING CODE 4910–57–M Scoping Booklet have also been line. Alternatives to be considered will distributed to resource agencies.) Others include: (1) Taking no action (no-build); may request the Scoping Booklet by (2) transportation systems management; DEPARTMENT OF TRANSPORTATION contacting the Branson City Engineer as (3) fixed guideway transit (including indicated in ADDRESSES above. Also elevated options with park-and-ride National Highway Traffic Safety contact the Branson City Engineer if you facilities and feeder bus/shuttle vans); Administration wish to be placed on the mailing list to and (4) other alternatives discovered receive additional information as the during the scoping process. [Docket No. NHTSA–2004–18849] study develops. SUPPLEMENTARY INFORMATION: III. Probable Effects and Potential Notice of Receipt of Petition for Impacts for Analysis Decision That Nonconforming 1994– I. Scoping The transportation, social, economic, 1997 Right Hand Drive (RHD) Honda FTA, in cooperation with the City of and environmental effects of the Accord Sedan and Wagon Passenger Branson and the Missouri department of alternatives will be evaluated during the Cars Are Eligible for Importation Transportation (MoDOT), will prepare project study. The impact areas to be an EIS to address transit improvements addressed include: land use effects; AGENCY: National Highway Traffic in the City of Branson, Missouri. The visual/aesthetic effects; community, Safety Administration, DOT. EIS will evaluate all reasonable business and economic impacts; traffic ACTION: Notice of receipt of petition for alternatives identified during the and parking; public safety; utilities decision that nonconforming 1994–1997 scoping process, as required by the effects; relocations; water quality; flood Right Hand Drive (RHD) Honda Accord National Environmental Policy Act plains; natural systems impacts; air sedan and wagon passenger cars are (NEPA) and its implementing quality; noise and vibration; energy eligible for importation. regulations. This NEPA alternatives impacts; and cultural and historic SUMMARY: analysis is expected to result in the resources. Potential environmental This document announces selection of a locally preferred justice issues and financial receipt by the National Highway Traffic alternative, which may include a fixed considerations will also be addressed Safety Administration (NHTSA) of a guideway transit improvement. along with secondary, cumulative and petition for a decision that 1994–1997 construction impacts. RHD Honda Accord sedans and wagons II. Description of Corridor and that were not originally manufactured to Transportation Needs IV. FTA Procedures comply with all applicable Federal Branson, Missouri, with a populations In accordance with FTA policy, all motor vehicle safety standards are of about 6,000 accommodates over federal laws, regulations, and executive eligible for importation into the United seven million visitors a year. These orders affecting project development States because (1) they are substantially visitors make trips to multiple venues including but not limited to the similar to vehicles that were originally (theaters, lodging, restaurants, etc.), regulations of the Council on manufactured for sale in the United which are concentrated along State Environmental Quality and FTA States and that were certified by their Route 76. This roadway, referred to as regulations implementing NEPA (40 manufacturer as complying with the ‘‘the Strip,’’ offers a single lane of CFR parts 1500–1508, and 23 CFR part safety standards, and (2) they are vehicular flow in each direction divided 771), the Clean Air Act, Section 404 of capable of being readily altered to by a two-way left-turn lane. The the Clean Water Act, Executive Order conform to the standards. roadway is paralleled by narrow paved 12898 regarding environmental justice, DATES: The closing date for comments shoulders used as sidewalks and by the National Historic Preservation Act, on the petition is September 27, 2004.
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ADDRESSES: Comments should refer to applicable Federal motor vehicle safety Standard No. 108 Lamps, Reflective the docket number and notice number, standards. Devices and Associated Equipment: (a) and be submitted to: Docket The petitioner claims that it carefully Installation of U.S.-model headlamp Management, Room PL–401, 400 compared non-U.S. certified 1994–1997 assemblies, and (b) installation of front Seventh St., SW., Washington, DC RHD Honda Accord sedans and wagons sidemarker lamp assemblies that 20590. (Docket hours are from 9 a.m. to to their U.S.-certified LHD counterparts incorporate side reflex reflectors. 5 p.m.) Anyone is able to search the (which the petitioner states are Standard No. 110 Tire Selection and electronic form of all comments manufactured in the same plant and on Rims: Installation of a tire information received into any of our dockets by the the same assembly line), and found the placard. name of the individual submitting the vehicles to be substantially similar with Standard No. 111 Rearview Mirrors: comment (or signing the comment, if respect to compliance with most Federal Inscription of the required warning submitted on behalf of an association, motor vehicle safety standards. statement on the passenger side business, labor union, etc.). You may AAD submitted information with its rearview mirror. review DOT’s complete Privacy Act petition intended to demonstrate that Standard No. 301 Fuel System Statement in the Federal Register non-U.S. certified 1994–1997 RHD Integrity: Installation of a rollover valve published on April 11, 2000 (Volume Honda Accord sedans and wagons, as in the fuel tank vent line between the fuel tank and the evaporative emissions 65, Number 70; Pages 19477–78), or you originally manufactured, conform to collection canister. may visit http://dms.dot.gov. many Federal motor vehicle safety The petitioner states that a vehicle FOR FURTHER INFORMATION CONTACT: standards in the same manner as their identification number plate must be Coleman Sachs, Office of Vehicle Safety U.S.-certified LHD counterparts, or are affixed to all non-U.S. certified 1994– Compliance, NHTSA (202) 366–3151). capable of being readily altered to 1997 RHD Honda Accord sedans and SUPPLEMENTARY INFORMATION: conform to those standards. wagons to meet the requirements of 49 Specifically, the petitioner claims that Background CFR part 565. non-U.S. certified 1994–1997 RHD The petitioner additionally states that Under 49 U.S.C. 30141(a)(1)(A), a Honda Accord sedans and wagons are all vehicles will be inspected prior to motor vehicle that was not originally identical to their U.S.-certified LHD importation to assure compliance with manufactured to conform to all counterparts with respect to compliance the Theft Prevention Standard at 49 CFR applicable Federal motor vehicle safety with Standard Nos. 102 Transmission part 541, and that vehicles will be standards shall be refused admission Shift Lever Sequence, Starter Interlock, modified, if necessary, to comply with into the United States unless NHTSA and Transmission Braking Effect, 103 that standard. has decided that the motor vehicle is Windshield Defrosting and Defogging Interested persons are invited to substantially similar to a motor vehicle Systems, 104 Windshield Wiping and submit comments on the petition originally manufactured for sale in the Washing Systems, 105 Hydraulic and described above. In addition, NHTSA United States, certified under 49 U.S.C. Electric Brake Systems, 106 Brake specifically requests comments 30115, and of the same model year as Hoses, 109 New Pneumatic Tires, 113 addressing the issue of whether an RHD the model of the motor vehicle to be Hood Latch System, 114 Theft vehicle can be properly considered compared, and is capable of being Protection, 116 Motor Vehicle Brake ‘‘substantially similar’’ to an LHD readily altered to conform to all Fluids, 118 Power-Operated Window, vehicle of the same make, model, and applicable Federal motor vehicle safety Partition, and Roof Panel Systems, 124 model year. standards. Accelerator Control Systems, 201 While there is no specific prohibition Petitions for eligibility decisions may Occupant Protection in Interior Impact, on the importation of an RHD vehicle, be submitted by either manufacturers or 202 Head Restraints, 204 Steering our policy has been that such vehicles importers who have registered with Control Rearward Displacement, 205 may not be imported under eligibility NHTSA pursuant to 49 CFR part 592. As Glazing Materials, 206 Door Locks and decisions that cover only the LHD specified in 49 CFR 593.7, NHTSA Door Retention Components, 207 version of the vehicle. We have taken publishes notice in the Federal Register Seating Systems, 208 Occupant Crash this position because our experience has of each petition that it receives, and Protection, 209 Seat Belt Assemblies, shown that the safety performance of an affords interested persons an 210 Seat Belt Assembly Anchorages, 212 RHD vehicle is not necessarily the same opportunity to comment on the petition. Windshield Mounting, 214 Side Impact as that of an apparently similar LHD At the close of the comment period, Protection, 216 Roof Crush Resistance, vehicle that is offered for sale in this NHTSA decides, on the basis of the 219 Windshield Zone Intrusion, and 302 country. However, we will consider an petition and any comments that it has Flammability of Interior Materials. RHD vehicle to be ‘‘substantially received, whether the vehicle is eligible Additionally, the petitioner states that similar’’ to a U.S.-certified LHD vehicle for importation. The agency then non-U.S. certified 1994–1997 RHD (and therefore eligible for importation publishes this decision in the Federal Honda Accord sedans and wagons under a decision covering the LHD Register. comply with the Bumper Standard version) if the manufacturer advises us American Auto Dream of Costa Mesa, found in 49 CFR part 581. that the RHD vehicle would perform the California (‘‘AAD’’) (Registered Importer Petitioner also contends that the same as the U.S.-certified LHD vehicle 02–224) has petitioned NHTSA to vehicles are capable of being readily in dynamic crash tests. Absent such a decide whether 1994–1997 RHD Honda altered to meet the following standards, showing, which indicates to us that the Accord sedans and wagons are eligible in the manner indicated: manufacturer has conducted a due care for importation into the United States. Standard No. 101 Controls and assessment of compliance of a RHD The vehicles that AAD believes are Displays: (a) Substitution of a lens version with all applicable FMVSS, the substantially similar are 1994–1997 left marked ‘‘Brake’’ for a lens with a RI must petition the agency under 49 hand drive (LHD) Honda Accord sedans noncomplying symbol on the brake CFR 593.5(2) to determine the vehicle and wagons that were manufactured for failure indicator lamp; (b) recalibration eligible for importation. To be granted, sale in the United States and certified by of the speedometer/odometer from the petition must demonstrate that the their manufacturer as conforming to all kilometers to miles per hour. vehicle, when modified, would comply
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with all applicable Federal motor rights over a BNSF line of railroad from the provisions of 49 U.S.C. 10903 vehicle safety standards, including between BNSF milepost 1406.3 near to abandon a 23.71-mile line of railroad those for which dynamic crash testing is Dover, ID, and BNSF milepost 1402.41 between milepost 0.57, near Walcott prescribed. near Sandpoint, ID, including to ES and milepost 24.28, at Saratoga, in By submitting the petition at issue, 49+88.2, a total distance of Carbon County, WY. The line traverses AAS is requesting that NHTSA approximately 5.24 miles.2 The United States Postal Service Zip Codes reevaluate this policy for an RHD modified agreement will change the 82331 and 82335 and includes no vehicle that is manufactured in the same compensation and maintenance terms of stations. plant, and on the same assembly line, as an existing 1992 Agreement. The line does not contain federally its U.S.-certified counterpart. In The transaction was scheduled to be granted rights-of-way. Any processing this petition, we have consummated on July 30, 2004. documentation in the railroad’s decided that a comment period of 45 As a condition to this exemption, any possession will be made available days is necessary to afford interested employees affected by the trackage promptly to those requesting it. parties an opportunity to respond to the rights will be protected by the The interests of railroad employees issues that it raises. We are particularly conditions imposed in Norfolk and will be protected by the conditions set interested in comments concerning the Western Ry. Co.—Trackage Rights—BN, forth in Oregon Short Line R. Co.— likelihood that the RHD vehicle at issue, 354 I.C.C. 605 (1978), as modified in Abandonment—Goshen, 360 I.C.C. 91 which is assembled on the same Mendocino Coast Ry., Inc.—Lease and (1979). assembly line as its U.S.-certified LHD Operate, 360 I.C.C. 653 (1980). By issuance of this notice, the Board counterpart, would, by virtue of that This notice is filed under 49 CFR is instituting an exemption proceeding fact, perform the same as the U.S.- 1180.2(d)(7). If it contains false or pursuant to 49 U.S.C. 10502(b). A final certified vehicle in dynamic crash tests misleading information, the exemption decision will be issued by November 10, as well as crash avoidance tests. is void ab initio. Petitions to revoke the 2004. Comments should refer to the docket exemption under 49 U.S.C. 10502(d) Any offer of financial assistance number and be submitted to: Docket may be filed at any time. The filing of (OFA) under 49 CFR 1152.27(b)(2) will Management, Room PL–401, 400 a petition to revoke will not be due no later than 10 days after Seventh St., SW., Washington, DC automatically stay the transaction. service of a decision granting the 20590. (Docket hours are from 9 a.m. to An original and 10 copies of all petition for exemption. Each OFA must 5 p.m.) It is requested but not required pleadings, referring to STB Finance be accompanied by a $1,100 filing fee. that 10 copies be submitted. Docket No. 34526, must be filed with See 49 CFR 1002.2(f)(25). All comments received before the the Surface Transportation Board, 1925 All interested persons should be close of business on the closing date K Street, NW., Washington, DC 20423– aware that, following abandonment of indicated above will be considered, and 0001. In addition, a copy of each rail service and salvage of the line, the will be available for examination in the pleading must be served on Robert T. line may be suitable for other public docket at the above address both before Opal, General Commerce Counsel, 1400 use, including interim trail use. Any and after that date. To the extent Douglas Street, Stop 1580, Omaha, NE request for a public use condition under possible, comments filed after the 68179. 49 CFR 1152.28 or for trail use/rail closing date will also be considered. Board decisions and notices are banking under 49 CFR 1152.29 will be Notice of final action on the petition available on our Web site at http:// due no later than September 1, 2004. will be published in the Federal www.stb.dot.gov. Each trail use request must be Register pursuant to the authority Decided: August 6, 2004. accompanied by a $200 filing fee. See 49 indicated below. By the Board, David M. Konschnik, CFR 1002.2(f)(27). Authority: 49 U.S.C. 30141(a)(1)(A) and Director, Office of Proceedings. All filings in response to this notice (b)(1); 49 CFR 593.8; delegations of authority Vernon A. Williams, must refer to STB Docket No. AB–307 at 49 CFR 1.50 and 501.8. (Sub-No. 5X) and must be sent to: (1) Secretary. Surface Transportation Board, 1925 K Claude H. Harris, [FR Doc. 04–18447 Filed 8–11–04; 8:45 am] Street, NW., Washington, DC 20423– Director, Office of Vehicle Safety Compliance. BILLING CODE 4915–01–P 0001, and (2) Karl Morell, Of Counsel, [FR Doc. 04–18483 Filed 8–11–04; 8:45 am] Ball Janik LLP, 1455 F Street, NW., BILLING CODE 4910–59–U DEPARTMENT OF TRANSPORTATION Suite 225, Washington, DC 20005. Replies to the WYCO petition are due Surface Transportation Board on or before September 1, 2004. DEPARTMENT OF TRANSPORTATION Persons seeking further information [STB Docket No. AB–307 (Sub-No. 5X)] Surface Transportation Board concerning abandonment procedures may contact the Board’s Office of Public Wyoming and Colorado Railroad [STB Finance Docket No. 34526] Services at (202) 565–1592 or refer to Company, Inc.—Abandonment the full abandonment or discontinuance Exemption—in Carbon County, WY Union Pacific Railroad Company— regulations at 49 CFR part 1152. Trackage Rights Exemption—The On July 23, 2004, Wyoming and Questions concerning environmental Burlington Northern and Santa Fe Colorado Railroad Company, Inc. issues may be directed to the Board’s Railway Company (WYCO) filed with the Board a petition Section of Environmental Analysis The Burlington Northern and Santa Fe under 49 U.S.C. 10502 for exemption (SEA) at (202) 565–1539. [Assistance for Railway Company (BNSF) has agreed to the hearing impaired is available a modified trackage rights agreement UP filed a copy of the final agreement, dated July through the Federal Information Relay 30, 2004, as executed by the parties. Service (FIRS) at 1–800–877–8339.] governing Union Pacific Railroad 2 1 The trackage rights were originally exempted in An environmental assessment (EA) (or Company’s (UP) overhead trackage Union Pacific Railroad Company and Burlington Northern Railroad Company—Joint Relocation environmental impact statement (EIS), if 1 UP submitted, as Exhibit 2 to the notice of Project Exemption, Finance Docket No. 32081 (ICC necessary) prepared by SEA will be exemption, a draft agreement. On August 5, 2004, served July 2, 1992). served upon all parties of record and
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upon any agencies or other persons who $15 billion in private investment capital prior Allocatee wishing to apply for an commented during its preparation. that, in turn, will facilitate economic additional allocation will be permitted Other interested persons may contact and community development in Low- to use legally binding investor SEA to obtain a copy of the EA (or EIS). Income Communities. In this NOAA, commitments as well as Qualified EAs in these abandonment proceedings the Fund addresses specifically how an Equity Investments in order to meet the normally will be made available within entity may apply to receive an eligibility requirements. These 60 days of the filing of the petition. allocation of NMTCs, the competitive requirements are more fully described The deadline for submission of procedure through which NMTC in Section III. 2 of this NOAA. comments on the EA will generally be Allocations will be made, and the within 30 days of its service. actions that will be taken to ensure that B. Program Guidance and Regulations Board decisions and notices are proper allocations are made to available on our Web site at http:// appropriate entities. This NOAA provides guidance for the www.stb.dot.gov. application and allocation of NMTCs for I. Allocation Availability Description Decided: August 4, 2004. the third round of the NMTC Program By the Board, David M. Konschnik, A. Programmatic Improvements and should be read in conjunction with: Director, Office of Proceedings. (i) Guidance published by the Fund on In the first two allocation rounds of how an entity may apply to become Vernon A. Williams, the NMTC Program, the Fund received certified as a CDE (66 FR 65806, Secretary. total allocation requests in excess of $56 December 20, 2001); (ii) the temporary [FR Doc. 04–18150 Filed 8–11–04; 8:45 am] billion when the total allocation regulations issued by the Internal BILLING CODE 4915–01–P authority available was $6 billion. In this NOAA, the Fund intends to target Revenue Service (26 CFR 1.45D–1T, its resources by providing allocations published on December 26, 2001, and DEPARTMENT OF THE TREASURY first to those highly qualified applicants amended on March 11, 2004) and that have demonstrated the most related guidance; and (iii) the Community Development Financial compelling and innovative business application and related materials for Institutions Fund strategies and/or have committed to this third NMTC Program allocation achieving the most challenging impacts round. All such materials may be found Funding Opportunity Title: Notice of in Low-Income Communities. As further on the Fund’s Web site at http:// Allocation Availability (NOAA) Inviting described in Section V. B of this NOAA, www.cdfifund.gov. The Fund Applications for the CY 2005 Allocation applicants must demonstrate that they encourages applicants to review these Round of the New Markets Tax Credit are minimally qualified under each of documents. Capitalized terms used but Program the four review criteria (Business not defined in this NOAA shall have the Announcement Type: Initial Strategy; Capitalization Strategy; respective meanings assigned to them in announcement of tax credit allocation Management Capacity and Community the allocation application, the Act or the availability. Impact) in order to be considered for an IRS temporary regulations. Dates: Electronic applications must be allocation. In addition, in prioritizing received by 5 p.m. ET on October 6, awards, the Fund will give greater II. Allocation Information 2004. Paper applications must be weight to the elements contained in A. Allocation Amounts postmarked on or before October 6, 2004 each applicant’s Business Strategy and and received by 5 p.m. ET on October Community Impact sections. The Fund The Fund expects that it may allocate 14, 2004 (see Section IV.D. of this believes that this programmatic focus is to CDEs the authority to issue to their NOAA for more details). Applications warranted because it helps direct investors up to the aggregate amount of must meet all eligibility and other resources to CDEs that are pursuing $2.0 billion in equity as to which requirements and deadlines, as innovative business strategies that are NMTCs may be claimed, as permitted applicable, set forth in this NOAA. likely to result in significant and under IRC § 45D(f)(1)(C). The Fund Allocation applicants that are not yet demonstrable community impact. anticipates that, under this NOAA, it certified as community development The Fund also has determined that, will not issue more than $150 million in entities (CDEs) must submit an given the historical level of interest in tax credit allocation authority per application for certification as a CDE the NMTC Program and the lower level applicant. The Fund, in its sole that is postmarked on or before of tax credit authority the Fund can discretion, reserves the right to allocate allocate in 2005, it is prudent to set September 8, 2004 and received by 5 amounts in excess of or less than the p.m. ET on September 15, 2004 (see general limitations on the size of anticipated maximum allocation Section III. of this NOAA for more individual allocation amounts. As stated amount if the Fund deems it details). in Section II. A. of this NOAA, the Fund appropriate. In order to receive an Executive Summary: This NOAA is generally will not provide more than issued in connection with the calendar $150 million of allocation authority to allocation in excess of $150 million, an year 2005 tax credit allocation round of any single applicant in this application applicant will likely need to the New Markets Tax Credit (NMTC) round. demonstrate, for example, that: (i) No Program, as authorized by Title I, Finally, the Fund has modified part of its strategy can be successfully subtitle C, section 121 of the certain eligibility requirements relating implemented without an allocation in Community Renewal Tax Relief Act of to prior Allocatees wishing to apply for excess of $150 million; or (ii) its strategy 2000 (the Act). Through the NMTC an additional allocation in this CY 2005 will produce extraordinary community Program, the Community Development allocation round. In the CY 2003–2004 impact. The Fund reserves the right to Financial Institutions Fund (the Fund) allocation round, prior Allocatees had to allocate tax credit authority to any, all provides authority to CDEs to offer an demonstrate that at least 50 percent of or none of the entities that submit an incentive to investors in the form of a their Qualified Equity Investments had application in response to this NOAA, tax credit over seven years, which is been issued. In this CY 2005 allocation and in any amount it deems expected to stimulate the provision of round, under certain circumstances, a appropriate.
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B. Types of Awards accountability chart that reflects ‘‘issued’’ those Qualified Equity NMTC Program awards are made in representation from Low-Income Investments that have been recorded in the form of tax credit authority. Communities in the revised service area. the Fund’s Allocation Tracking System The service area change request must be (ATS) by 11:59 p.m. e.t. on January 21, C. Notice of Allocation and Allocation sent by e-mail to [email protected] 2005. Allocatees and their Subsidiary Agreement or by facsimile to (202) 622–7754. transferees, if any, are advised to access Each Allocatee under this NOAA 2. Prior awardees or Allocatees: ATS to record each Qualified Equity must sign a Notice of Allocation and an Applicants must be aware that success Investment that they issue to an investor Allocation Agreement before the NMTC in a prior round of any of the Fund’s in exchange for cash. For purposes of Allocation is effective. The Notice of programs is not indicative of success this section of the NOAA, ‘‘committed’’ Allocation and the Allocation under this NOAA. Prior awardees of any Qualified Equity Investments are only Agreement contain the terms and component of the Fund’s Community those Equity Investments that are conditions of the allocation. For further Development Financial Institutions evidenced by a written, signed information, see Section VI. of this (CDFI) Program, Bank Enterprise Award document in which an investor: (i) NOAA. (BEA) Program, or any other Fund Commits to make an investment in the program and prior Allocatees under the Allocatee in a specified amount and on III. Eligibility NMTC Program are eligible to apply specified terms; (ii) has made an initial A. Eligible Applicants under this NOAA, except as follows: disbursement of the investment (a) Prior Allocatees and Qualified proceeds to the Allocatee, and such IRC § 45D specifies certain eligibility Equity Investment issuance initial disbursement has been recorded requirements that each applicant must requirements: A prior Allocatee in the in ATS as a Qualified Equity meet to be eligible to apply for an first round of the NMTC Program (CY Investment; (iii) commits to disburse the allocation of NMTCs. The following sets 2001–2002) is not eligible to receive a remaining investment proceeds to the forth additional detail and certain NMTC Allocation pursuant to this Allocatee based on specified amounts additional dates that relate to the NOAA unless the Allocatee can and payment dates; and (iv) commits to submission of applications under this demonstrate that, as of 11:59 p.m. e.t. on make the final disbursement to the NOAA: January 21, 2005, it has: (i) Issued and Allocatee no later than January 21, 2008. 1. CDE certification: For purposes of received cash from its investors for at The applicant will be required, upon this NOAA, the Fund will not consider least 50 percent of its Qualified Equity notification from the Fund, to submit an application for an allocation of Investments relating to its prior NMTC adequate documentation to substantiate NMTCs unless: (a) The applicant is Allocation; or (ii) issued and received the required issuances of and certified as a CDE at the time the Fund cash from its investors for at least 40 commitments for Quality Equity receives its NMTC Program allocation percent of its Qualified Equity Investments. application; or (b) the applicant submits Investments and that at least 80 percent (b) Failure to meet reporting an application for certification as a CDE of its total NMTC Allocation has been requirements: The Fund will not that is postmarked on or before exchanged for cash from or has been consider an application submitted by an September 8, 2004, and received by 5 committed by its investors. A prior applicant if the applicant, or an entity p.m. ET on September 15, 2004. Allocatee in the second round of the that Controls the applicant, is Applicants for certification may obtain NMTC Program (CY 2003–2004) is not Controlled by the applicant or shares a CDE certification application through eligible to receive a NMTC Allocation common management officials with the the Fund’s Web site at http:// pursuant to this NOAA unless the applicant (as determined by the Fund) www.cdfifund.gov. Applications for CDE Allocatee can demonstrate that, as of is a prior Fund awardee or Allocatee certification must be submitted as 11:59 p.m. e.t. on January 21, 2005, it under any Fund program and is not instructed in the application form. An has: (i) Issued and received cash from its current on the reporting requirements applicant that is a community investors for at least 50 percent of its set forth in a previously executed development financial institution Qualified Equity Investments relating to assistance, allocation or award (CDFI) or a specialized small business its prior NMTC Allocation; or (ii) issued agreement(s), as of the application investment company (SSBIC) does not and received cash from its investors for deadline of this NOAA. Please note that need to submit a CDE certification at least 20 percent of its Qualified the Fund only acknowledges the receipt application, but must register as a CDE Equity Investments and that at least 60 of reports that are complete. As such, on the Fund’s Web site on or before 5 percent of its total NMTC Allocation has incomplete reports or reports that are p.m. ET on September 8, 2004. The been exchanged for cash from or has deficient of required elements will not Fund will not provide allocations of been committed by its investors. be recognized as having been received. NMTCs to applicants that are not Further, an entity is not eligible to (c) Pending resolution of certified as CDEs. See Section IV.D.1.c. receive a NMTC Allocation pursuant to noncompliance: If an applicant is a of this NOAA for further requirements this NOAA if another entity that prior awardee or Allocatee under any relating to postmarks. Controls the applicant, is Controlled by Fund program and if: (i) It has If an applicant that has already been the applicant or shares common submitted complete and timely reports certified as a CDE wishes to change its management officials with the applicant to the Fund that demonstrate designated CDE service area, it must (as determined by the Fund) is a prior noncompliance with a previous submit its request for such a change to Allocatee and has not, as of 11:59 p.m. assistance, award or Allocation the Fund; and said request must be e.t. on January 21, 2005, met the Agreement; and (ii) the Fund has yet to received by the Fund by 5 p.m. ET on requirements for the issuance and/or make a final determination as to October 6, 2004. The CDE service area commitment of Qualified Equity whether the entity is in default of its change request must be sent from the Investments as set forth above for the previous assistance, award or Allocation applicant’s authorized representative Allocatees in the first and second Agreement, the Fund will consider the and include the applicable CDE control allocation rounds of the NMTC Program. applicant’s application under this number, the revised service area For purposes of this section of the NOAA pending full resolution, in the designation, and an updated NOAA, the Fund will only count as sole determination of the Fund, of the
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noncompliance. Further, if another the applicant or shares common for an award that has been terminated, entity that Controls the applicant, is management officials with the applicant expired, rescinded or deobligated by the Controlled by the applicant or shares (as determined by the Fund), is a prior Fund. common management officials with the Fund awardee or Allocatee under any (g) Contact the Fund: Accordingly, applicant (as determined by the Fund), Fund program whose award or applicants that are prior awardees and/ is a prior Fund awardee or Allocatee allocation terminated in default of a or Allocatees under any other Fund and if such entity: (i) Has submitted previously executed assistance, program are advised to: (i) Comply with complete and timely reports to the Fund allocation or award agreement(s), and the requirements specified in assistance, that demonstrate noncompliance with a the Fund has provided written allocation and/or award agreement(s), previous assistance, award or Allocation notification of such determination to the and (ii) contact the Fund to ensure that Agreement; and (ii) the Fund has yet to defaulting entity. all necessary actions are underway for make a final determination as to (f) Undisbursed balances: The Fund the disbursement of any outstanding whether the entity is in default of its will not consider an application balance of a prior award(s). All previous assistance, award or Allocation submitted by an applicant that is a prior outstanding reports, compliance or Agreement, the Fund will consider the Fund awardee under any Fund program disbursement questions should be applicant’s application under this if the applicant has a balance of directed to the Grants Management and NOAA pending full resolution, in the undisbursed funds (defined below) Compliance Manager by e-mail at sole determination of the Fund, of the under said prior award(s), as of the [email protected]; by telephone at noncompliance. application deadline of this NOAA. (202) 622–8226; by facsimile at (202) (d) Default status: The Fund will not Further, an entity is not eligible to apply 622–6453; or by mail to CDFI Fund, 601 consider an application submitted by an for an award pursuant to this NOAA if 13th Street, NW., Suite 200 South, applicant that is a prior Fund awardee another entity that Controls the Washington, DC 20005. The Fund will or Allocatee under any Fund program if, applicant, is Controlled by the applicant respond to applicants’ reporting, as of the application deadline of this or shares common management officials compliance or disbursement questions NOAA, the Fund has made a final with the applicant (as determined by the between the hours of 9 a.m. and 5 p.m. determination that such applicant is in Fund), is a prior Fund awardee under e.t., starting the date of publication of default of a previously executed any Fund program, and has a balance of this NOAA through October 4, 2004 (2 assistance, allocation or award undisbursed funds under said prior days before the application deadline). agreement(s) and the Fund has provided award(s), as of the application deadline The Fund will not respond to written notification of such of this NOAA. In a case where another applicants’ reporting, compliance or determination to such applicant. entity that Controls the applicant, is disbursement phone calls or e-mail Further, an entity is not eligible to apply Controlled by the applicant or shares inquiries that are received after 5 p.m. for an allocation pursuant to this NOAA common management officials with the e.t. on October 4, 2004, until after the if, as of the application deadline of this applicant (as determined by the Fund), funding application deadline of October NOAA, the Fund has made a final is a prior Fund awardee under any Fund 6, 2004. determination that another entity that program, and has a balance of 3. Entities that propose to transfer Controls the applicant, is Controlled by undisbursed funds under said prior NMTCs to Subsidiaries: Both for-profit the applicant or shares common award(s), as of the application deadline and non-profit CDEs may apply to the management officials with the applicant of this NOAA, the Fund will include the Fund for allocations of NMTCs, but only (as determined by the Fund): (i) Is a combined awards of the applicant and a for-profit CDE is permitted to provide prior Fund awardee or Allocatee under such affiliated entities when calculating NMTCs to its investors. A non-profit any Fund program; (ii) has been the amount of undisbursed funds. applicant wishing to apply for a NMTC determined by the Fund to be in default For purposes of this section, Allocation must demonstrate, prior to of a previously executed assistance, ‘‘undisbursed funds’’ is defined as: (i) In entering into an Allocation Agreement allocation or award agreement(s); and the case of a prior BEA Program with the Fund, that: (i) it controls one (iii) the Fund has provided written award(s), any balance of award funds or more Subsidiaries that are for-profit notification of such determination to the equal to or greater than five (5) percent entities; and (ii) it intends to transfer the defaulting entity. of the total prior BEA Program award(s) full amount of any NMTC Allocation it (e) Termination in default: The Fund that remains undisbursed more than receives to said Subsidiary. The will not consider an application three (3) years after the end of the Subsidiary transferee should: (i) Submit submitted by an applicant that is a prior calendar year in which the Fund signed a CDE certification application to the Fund awardee or Allocatee under any an award agreement with the awardee; Fund within 30 days after the non-profit Fund program if, within the 12-month and (ii) in the case of a prior CDFI applicant receives a Notice of Allocation period prior to the application deadline Program or other Fund program from the Fund; and (ii) must be certified of this NOAA, the Fund has made a award(s), any balance of award funds as a CDE prior to entering into an final determination that such equal to or greater than five (5) percent Allocation Agreement with the Fund. applicant’s prior award or allocation of the total prior award(s) that remains The NMTC Allocation transfer must be terminated in default of a previously undisbursed more than two (2) years pre-approved by the Fund, in its sole executed assistance, allocation or award after the end of the calendar year in discretion, and will be a condition of agreement(s) and the Fund has provided which the Fund signed an assistance the Allocation Agreement. A for-profit written notification of such agreement with the awardee. applicant that receives a NMTC determination to such applicant. ‘‘Undisbursed funds’’ does not Allocation may transfer such NMTC Further, an entity is not eligible to apply include (i) tax credit allocation Allocation to its for-profit Subsidiary or for an allocation pursuant to this NOAA authority made available through the Subsidiaries, provided that said if, within the 12-month period prior to NMTC Program; (ii) any award funds for Subsidiary transferees have been the application deadline of this NOAA, which the Fund received a full and certified as CDEs and such transfer is the Fund has made a final complete disbursement request from the pre-approved by the Fund, in its sole determination that another entity that awardee by the application deadline of discretion, which transfer will be a Controls the applicant, is Controlled by this NOAA; and (iii) any award funds condition of the Allocation Agreement.
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An applicant wishing to transfer all or then it may submit a single CDE relating to the submission of signature a portion of its NMTC Allocation to a certification application on behalf of the forms and supporting information, is set Subsidiary is not required to create the entire series of funds, and each fund forth in further detail in the electronic Subsidiary prior to submitting a NMTC must be separately certified as a CDE. application. An application must allocation application to the Fund. Applicants should note, however, that include a valid and current Employer Rather, the Fund will require each receipt of CDE certification as a single Identification Number (EIN) issued by applicant to indicate, in its NMTC entity or as multiple entities is not a the Internal Revenue Service and allocation application, whether it determination that an applicant and its assigned to the applicant and, if intends to transfer all or a portion of its related funds are properly classified as applicable, its Controlling Entity; NMTC Allocation to a Subsidiary and a single entity or as multiple entities for electronic applications without a valid its timeline for doing so. As stated Federal tax purposes. Regardless of EIN are incomplete and cannot be above, in no circumstance will the Fund whether the series of funds is classified transmitted to the Fund; paper authorize such a transfer until the Fund as a single partnership or corporation or applications submitted without a valid has certified the Subsidiary transferee as as multiple partnerships or EIN will be rejected as incomplete and a CDE. corporations, an applicant may not returned to the sender. For more 4. Entities that submit applications transfer any NMTC Allocations it information on obtaining an EIN, please together with Affiliates; applications receives to one or more of its funds contact the Internal Revenue Service at from common enterprises: As part of the unless the transfer is pre-approved by (800) 829–4933 or http://www.irs.gov. allocation application review process, the Fund, in its sole discretion, which An applicant may not submit more than the Fund considers whether applicants will be a condition of the Allocation one application in response to this are Affiliates, as such term is defined in Agreement. NOAA. In addition, as stated in Section the allocation application. If an 6. Entities that are BEA Program III.A.4 of this NOAA, an applicant and applicant and its Affiliates wish to awardees: An insured depository its Affiliates must collectively submit submit allocation applications, they institution investor (and its Affiliates only one allocation application; an must do so collectively, in one and Subsidiaries) may not receive a applicant and its Affiliates may not application; an applicant and its NMTC Allocation in addition to a BEA submit separate allocation applications. Affiliates may not submit separate Program award for the same investment C. Form of Application Submission allocation applications. If Affiliated in a CDE. Likewise, an insured entities submit multiple applications, depository institution investor (and its Applicants may submit applications the Fund reserves the right either to Affiliates and Subsidiaries) may not under this NOAA either electronically reject all such applications received or receive a BEA Program award in or in paper form. Applications sent by to select a single application as the only addition to a NMTC Allocation for the facsimile or by e-mail will not be one that will be considered for an same investment in a CDE. accepted. In order to expedite allocation. application review, the Fund expects For purposes of this NOAA, in IV. Application and Submission applicants to submit applications addition to assessing whether applicants Information electronically (via an Internet-based meet the definition of the term A. Address To Request Application ‘‘Affiliate’’ found in the allocation application) in accordance with the Package application, the Fund will consider: (i) instructions provided on the Fund’s Whether the activities described in Applicants may submit applications website. Submission of an electronic applications submitted by separate under this NOAA either electronically application will facilitate the processing entities are, or will be, operated or or in paper form. Shortly following the and review of applications and the managed as a common enterprise that, publication of this NOAA, the Fund will selection of Allocatees; further it will in fact or effect, could be viewed as a make available the electronic allocation assist the Fund in the implementation of single entity; and (ii) whether the application on its Web site at http:// electronic reporting requirements. business strategies and/or activities www.cdfifund.gov. The Fund will send 1. Electronic applications: Electronic described in applications submitted by application materials to applicants that applications must be submitted solely separate entities are so closely related are unable to download them from the by using the Fund’s website and must that, in fact or effect, they could be Web site. To have application materials be sent in accordance with the viewed as substantially identical sent to you, contact the Fund by submission instructions provided in the applications. In such cases, the Fund telephone at (202) 622–6355; by e-mail electronic application form. Applicants reserves the right either to reject all at [email protected]; or by need access to Internet Explorer 5.5 or applications received from all such facsimile at (202) 622–7754. These are higher or Netscape Navigator 6.0 or entities or to select a single application not toll free numbers. higher, Windows 98 or higher (or other as the only one that will be considered system compatible with the above B. Application Content Requirements for an allocation. Explorer and Netscape software) and 5. Entities created as a series of funds: Detailed application content optimally at least a 56Kbps Internet An applicant whose business structure requirements are found in the connection in order to meet the consists of an entity with a series of application related to this NOAA. electronic application submission funds may apply for CDE certification as Applicants must submit all materials requirements. The Fund’s electronic a single entity, or as multiple entities. If described in and required by the application system will only permit the such an applicant represents that it is application by the applicable deadlines. submission of applications in which all properly classified for Federal tax Applicants will not be afforded an required questions and tables are fully purposes as a single partnership or opportunity to provide any missing completed. Additional information, corporation, it may apply for CDE materials or documentation. Electronic including instructions relating to the certification as a single entity. If an applications must be submitted solely submission of signature forms and applicant represents that it is properly by using the format made available at supporting information, is set forth in classified for Federal tax purposes as the Fund’s Web site. Additional further detail in the electronic multiple partnerships or corporations, information, including instructions application.
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2. Paper applications: If an applicant c. For purposes of this NOAA, the A. Criteria is unable to submit an electronic term ‘‘postmark’’ is defined by 26 CFR 1. Business Strategy (25-point application, it must submit to the Fund 301.7502–1. In general, the Fund will maximum). (a) In assessing an a request for a paper application using require that the postmarked document applicant’s business strategy, reviewers the NMTC Program Paper Application bear a postmark date that is on or before will consider, among other things: the Submission Form, and the request must the applicable deadline. The document applicant’s products, services and be received by 5 p.m. e.t. on September must be in an envelope or other investment criteria; the prior 22, 2004. The NMTC Program Paper appropriate wrapper, properly performance of the applicant or its Application Submission Form may be addressed as set forth in this NOAA and Controlling Entity, particularly as it obtained from the Fund’s Web site at delivered by the United States Postal relates to making similar kinds of http://www.cdfifund.gov or the form Service or any other private delivery investments as those it proposes to may be requested by e-mail to service designated by the Secretary of _ make with the proceeds of Qualified paper [email protected] or by the Treasury. For more information on Equity Investments; the applicant’s facsimile to (202) 622–7754. The designated delivery services, please see prior performance in providing capital completed NMTC Program Paper IRS Notice 2002–62, 2002–2 C.B. 574. or technical assistance to disadvantaged Application Submission Form should be E. Intergovernmental Review businesses or communities; the directed to the Fund’s Chief Information projected level of the applicant’s Officer and must be sent by facsimile to Not applicable. pipeline of potential investments; and (202) 622–7754. F. Funding Restrictions the extent to which the applicant D. Application Submission Dates and intends to make Qualified Low-Income Times For allowable uses of investment Community Investments in one or more proceeds related to an NMTC businesses in which persons unrelated 1. Application deadlines: a. Electronic Allocation, please see 26 U.S.C. 45D and to the entity hold a majority equity applications must be received by 5 p.m. the temporary regulations issued by the interest. e.t. on October 6, 2004. Electronic Internal Revenue Service (26 CFR Under the Business Strategy criterion, applications cannot be transmitted or 1.45D–1T, published on December 26, an applicant will generally score well to received after 5 p.m. e.t. on October 6, 2001, and amended on March 11, 2004) the extent that it will deploy debt or 2004. In addition, applicants that and related guidance. Please see Section investment capital in products or submit electronic applications must I., above, for the Programmatic services which: (i) Are designed to meet separately submit (by mail or other Improvements of this NOAA. the needs of underserved markets; (ii) courier delivery service) an original G. Other Submission Requirements are flexible or non-traditional in form; signature page, and all other required and (iii) focus on customers or partners paper attachments. The original Addresses: Paper applications and the that typically lack access to signature page and additional signature page and attachments for conventional sources of capital. An documents must be postmarked on or electronic applications must be sent to: applicant will also score well to the before October 12, 2004, and received CDFI Fund Grants Management and extent that it: (i) Has a track record of by 5 p.m. e.t. on October 19, 2004. See Compliance Manager, NMTC Program, successfully providing products and application instructions, provided in the Bureau of Public Debt, 200 Third Street, services similar to those it intends to electronic application, for further detail. Room 10, Parkersburg, WV 26101. The use with the proceeds of Qualified Applications and other required telephone number to be used in Equity Investments; (ii) has identified, documents and other attachments conjunction with overnight delivery or or has a process for identifying, postmarked or received after these dates mailings to this address is (304) 480– potential transactions; (iii) demonstrates and times will be rejected and returned 5450. Paper applications and the a likelihood of issuing Qualified Equity to the sender. If the original signature signature page or attachments will not Investments and making the related page is not postmarked and received by be accepted at the Fund’s offices in Qualified Low-Income Community the deadlines specified above, the Washington, DC. Paper applications and Investments in a time period that is application will be rejected and signature pages or attachments received significantly shorter than the 5-year returned to the sender. See Section in the Fund’s offices will be rejected period permitted under IRC § 45D(b)(1); IV.D.1.c. of this NOAA for further and returned to the sender. Except for and (iv) in the case of an applicant requirements relating to postmarks. the signature page and attachments, proposing to purchase loans from CDEs, Additional deadlines (if any) relating to electronic applications must be the applicant will require the CDE the submission of general supporting submitted solely by using the Fund’s selling such loans to re-invest the documentation will be further detailed website and must be sent in accordance proceeds of the loan sale to provide in the electronic application. Please with the submission instructions additional products and services to note that the document submission provided in the electronic application Low-Income Communities. deadlines in this NOAA and/or the form. (b) Priority Points: In addition, as allocation application are strictly provided by IRC § 45D(f)(2), the Fund V. Application Review Information enforced. will ascribe additional points to entities b. Paper applications, including the There are two parts to the substantive that meet either or both of the statutory requisite original signature page, and all review process for each allocation priorities. First, the Fund will give up other required paper attachments must application—Phase 1 and Phase 2. In to five (5) additional points to any be postmarked on or before October 6, Phase 1, the Fund will evaluate each applicant that has a record of having 2004, and received by 5 p.m. e.t. on application, assigning points and successfully provided capital or October 14, 2004. Paper applications numeric scores with respect to the technical assistance to disadvantaged postmarked or received after these criteria described below. In Phase 2, the businesses or communities. Second, the deadlines will not be accepted for Fund will rank applicants in accordance Fund will give five (5) additional points consideration and will be returned to with the procedures set forth in Section to any applicant that intends to satisfy the sender. V.B. of this NOAA. the requirement of IRC § 45D(b)(1)(B) by
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making Qualified Low-Income It has secured investor commitments, or management team or other essential Community Investments in one or more has a reasonable strategy for obtaining personnel have experience in: (a) businesses in which persons unrelated such commitments; (b) its request for Deploying capital or technical to an applicant (within the meaning of allocations is commensurate with both assistance in Low-Income Communities, IRC § 267(b) or IRC § 707(b)(1)) hold the the level of Qualified Equity particularly those likely to be served by majority equity interest. Applicants may Investments it is likely to raise and its the applicant with the proceeds of earn points for either or both statutory expected investment strategy to deploy Qualified Equity Investments; (b) raising priorities. Thus, applicants that meet funds raised with NMTCs; (c) it capital, particularly from for-profit the requirements of both priority generally demonstrates that the investors; (c) asset and risk categories can receive up to a total of ten economic benefits of the tax credit will management; and (d) fulfilling (10) additional points. A record of be passed through to end users; (d) it is government compliance requirements, having successfully provided capital or likely to leverage other sources of particularly tax program compliance. technical assistance to disadvantaged funding in addition to NMTC investor An applicant will also score well to the businesses or communities may be dollars; and (e) it intends to invest the extent it has policies and systems in demonstrated either by the past actions proceeds from the aggregate amount of place to ensure ongoing compliance of an applicant itself or by its its Qualified Equity Investments at a with NMTC Program requirements, and Controlling Entity (e.g., where a new level that exceeds the requirements of to the extent that Low-Income CDE is established by a nonprofit IRC § 45D(b)(1)(B). In the case of an Community stakeholders play an active corporation with a history of providing applicant proposing to raise investor role in designing or implementing its assistance to disadvantaged funds from organizations that also will business plan. In the case of an communities). An applicant that identify or originate transactions for the applicant (or any entity that Controls receives additional points for intending applicant or from affiliated entities, said the applicant, is Controlled by the to make investments in unrelated applicant will score well to the extent applicant or shares common businesses and is awarded a NMTC that it will offer products with more management officials with the applicant Allocation must meet the requirements favorable rates or terms than those (as determined by the Fund)) that has of IRC § 45D(b)(1)(B) by investing currently offered by the investor and/or received a NMTC Allocation from the substantially all of the proceeds from will target its activities to areas of Fund under a prior allocation round, the the aggregate amount of its Qualified greater economic distress than those applicant will score well to the extent Equity Investments in unrelated currently targeted by the investor. it can: (a) Demonstrate that substantial businesses. The Fund will factor in an 3. Management Capacity (25-point activities have occurred through its applicant’s priority points when ranking maximum). In assessing an applicant’s prior allocation(s); and (b) substantiate a applicants during Phase 2 of the review management capacity, reviewers will need for additional allocation authority. process, as described below. consider, among other things, the 4. Community Impact (25-point 2. Capitalization Strategy (25-point qualifications of the applicant’s maximum). In assessing the impact on maximum). In assessing an applicant’s principals, its board members, its communities expected to result from the capitalization strategy, reviewers will management team, and other essential applicant’s proposed investments, consider, among other things: the extent staff or contractors, with specific focus reviewers will consider, among other to which the applicant has secured on: experience in deploying capital or things, the degree to which the investments, commitments to invest, or technical assistance, including activities applicant is likely to achieve significant indications of interest in investments similar to those described in the and measurable community from investors, commensurate with its applicant’s business strategy; experience development and economic impacts in requested amount of tax credit in raising capital; asset management and its Low-Income Communities, and allocations; the applicant’s strategy for risk management experience; experience whether the applicant is working in identifying additional investors, if with fulfilling compliance requirements particularly economically distressed necessary, including the applicant’s (or of other governmental programs, markets and/or in concert with Federal, its Controlling Entity’s) prior including other tax programs; and the state or local government or community performance with raising equity from applicant’s (or its Controlling Entity’s) economic development initiatives (e.g., investors, particularly for-profit financial health. Reviewers will also Empowerment Zones, Enterprise investors; the extent to which the consider the extent to which an Communities, and Renewal applicant identifies how existing applicant has protocols in place to Communities). An applicant will investors will leverage their investments ensure ongoing compliance with NMTC generally score well under this section in Low-Income Communities or how Program requirements, and the level of to the extent that: (a) it articulates how new investors will be brought into such involvement of community its strategy is likely to produce investments; the distribution of the representatives and other stakeholders significant and measurable community economic benefits of the tax credit; the in the design, implementation or development and economic impacts that extent to which the applicant intends to monitoring of an applicant’s business would not be achieved without NMTCs; invest the proceeds from the aggregate plan and strategy. In the case of an and (b) it is working in particularly amount of its Qualified Equity applicant (or any entity that Controls economically distressed or otherwise Investments at a level that exceeds the the applicant, is Controlled by the underserved communities and/or in requirements of IRC § 45D(b)(1)(B), applicant or shares common concert with other Federal, state or local including the extent to which the management officials with the applicant government or community economic applicant has identified the financial (as determined by the Fund)) that has development initiatives. resources outside of the NMTC received a NMTC Allocation from the investments necessary to support its Fund under a prior allocation round, B. Review and Selection Process operations or finance its activities; and reviewers will consider the activities All allocation applications will be the applicant’s timeline for utilizing an that have occurred to date with respect reviewed for eligibility and NMTC Allocation. to the prior allocation(s). completeness. The Fund may consult An applicant will generally score well An applicant will generally score well with the IRS on the eligibility under this section to the extent that: (a) under this section to the extent that its requirements under IRC § 45D. To be
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complete, the application must contain, and will deduct points for the required to submit additional at a minimum, all information described applicant’s (or any entity that Controls information about its application in as required in the application form. An the applicant, is Controlled by the order to assist the Fund with its final incomplete application will be rejected applicant or shares common evaluation process. Such requests must and returned to the sender. Once the management officials with the applicant be responded to within the time application has been determined to be (as determined by the Fund)) failure to parameters set by the Fund. The eligible and complete, the Fund will meet the reporting deadlines set forth in selecting official(s) will make a final conduct the substantive review of each any assistance, award or Allocation allocation determination based on an application in two parts (Phase 1 and Agreement(s) with the Fund during the applicant’s file, including without Phase 2) in accordance with the criteria applicant’s two complete fiscal years limitation, eligibility under IRC § 45D, and procedures generally described in prior to the application deadline of this the reviewers’ scores and the amount of this NOAA and the allocation NOAA (generally FY 2002 and 2003). allocation authority available. In the application. All outstanding reports or compliance case of applicants (or any entity that Phase 1: Fund reviewers will evaluate questions should be directed to the Controls the applicant, is Controlled by and score each application in the first Grants Management and Compliance the applicant or shares common part of the review process. An applicant Manager by e-mail at management officials with the applicant must exceed a minimum overall [email protected]; by telephone at (as determined by the Fund)) that are aggregate base score threshold and (202) 622–8226; by facsimile at (202) regulated by the Federal government or exceed a minimum aggregate section 622–6453; or by mail to CDFI Fund, 601 a State agency (or comparable entity), score threshold in each of the four 13th Street, NW, Suite 200 South, the Fund’s selecting official(s) reserve(s) application sections (Business Strategy, Washington, DC 20005. The Fund will the right to consult with and take into Capitalization Strategy, Management respond to reporting or compliance consideration the views of the Capacity, and Community Impact) in questions between the hours of 9 a.m. appropriate Federal or State banking order to advance from the first part of and 5 p.m. e.t., starting the date of the and other regulatory agencies. In the the substantive review process. If, in the publication of this NOAA through case of applicants (or any entity that case of a particular application, a October 4, 2004. The Fund will not Controls the applicant, is Controlled by reviewer’s total base score or section respond to reporting or compliance the applicant or shares common score(s) (in one or more of the four phone calls or e-mail inquiries that are management officials with the applicant application sections), varies received after 5 p.m. e.t. on October 4, (as determined by the Fund)) that are significantly from the median of the 2004, until after the funding application also Small Business Investment reviewers’ total base scores or section deadline of October 6, 2004. Companies, Specialized Small Business scores for such application, the Fund The Fund reserves the right to reject Investment Companies or New Markets may, in its sole discretion, obtain the any NMTC allocation application in the Venture Capital Companies, the Fund comments and recommendations of an case of a prior Fund awardee, if such reserves the right to consult with and additional reviewer to determine applicant has failed to comply with the take into consideration the views of the whether the anomalous score should be terms, conditions, and other Small Business Administration. replaced with the score of the additional requirements of the prior or existing The Fund reserves the right to reviewer. assistance or award agreement(s) with conduct additional due diligence, as Phase 2: Once the Fund has the Fund. The Fund reserves the right determined reasonable and appropriate determined which applicants have met to reject any NMTC allocation by the Fund, in its sole discretion, the required minimum overall aggregate application in the case of a prior Fund related to the applicant and its officers, base score and aggregate section score Allocatee, if such applicant has failed to thresholds, the Fund will rank comply with the terms, conditions, and directors, owners, partners and key applicants on the basis of their other requirements of its prior or employees. combined scores in the Business existing Allocation Agreement(s) with Each applicant will be informed of the Strategy and Community Impact the Fund. The Fund also reserves the Fund’s award decision either through a sections of the application and will right to reject any NMTC allocation Notice of Allocation if selected for an make adjustments to each applicant’s application in the case of any applicant, allocation (see Section VI.A. of this priority points so that these points if an entity that Controls the applicant, NOAA) or a declination letter, if not maintain the same relative weight in the is Controlled by the applicant or shares selected for an allocation, which may be ranking of applicant scores as in the first common management officials with the for reasons of application two allocation rounds. The Fund will applicant (as determined by the Fund), incompleteness, ineligibility or award allocations in the order of this has failed to meet the terms, conditions substantive issues. All applicants that ranking, subject to applicants’ meeting and other requirements of any prior or are not selected for an allocation based all other eligibility requirements; existing assistance agreement, award on substantive issues will likely be provided, however, that the Fund, in its agreement or Allocation Agreement given the opportunity to obtain feedback sole discretion, reserves the right to with the Fund. on the strengths and weaknesses of their reject an application and/or adjust As a part of the substantive review applications. This feedback will be award amounts as appropriate based on process, the Fund may permit provided in a format and within a information obtained during the review reviewer(s) to make telephone calls to timeframe to be determined by the process. applicants for the sole purpose of Fund, based on available resources. In the case of an applicant (or any obtaining, clarifying or confirming The Fund further reserves the right to entity that Controls the applicant, is application information. In no event change its eligibility and evaluation Controlled by the applicant or shares shall such contact be construed to criteria and procedures, if the Fund common management officials with the permit an applicant to change any deems it appropriate; if said changes applicant (as determined by the Fund)) element of its application. Reviewers materially affect the Fund’s award that has previously received an award or will not contact applicants without the decisions, the Fund will provide allocation from the Fund through any prior approval of the Fund. At this point information regarding the changes Fund program, the Fund will consider in the process, an applicant may be through the Fund’s Web site.
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There is no right to appeal the Fund’s right, in its sole discretion, to delay to terminate and rescind the Notice of allocation decisions. The Fund’s entering into an Allocation Agreement Allocation and the allocation made allocation decisions are final. and/or to impose limitations on an under this NOAA. Allocatee’s ability to issue Qualified 3. Default status: If, at any time prior VI. Award Administration Information Equity Investments to investors until to entering into an Allocation A. Notice of Allocation said prior awardee or Allocatee is Agreement through this NOAA, the The Fund will signify its selection of current on the reporting requirements in Fund has made a final determination an applicant as an Allocatee by the previously executed assistance, that an Allocatee that is a prior Fund delivering a signed Notice of Allocation allocation or award agreement(s). Please awardee or Allocatee under any Fund to the applicant. The Notice of note that the Fund only acknowledges program is in default of a previously executed assistance, allocation or award Allocation will contain the general the receipt of reports that are complete. agreement(s) and has provided written terms and conditions underlying the As such, incomplete reports or reports notification of such determination to the Fund’s provision of an NMTC that are deficient of required elements Allocatee, the Fund reserves the right, Allocation including, but not limited to, will not be recognized as having been in its sole discretion, to delay entering the requirement that an Allocatee and received. If said prior awardee or into an Allocation Agreement and/or to the Fund enter into an Allocation Allocatee is unable to meet this impose limitations on the Allocatee’s Agreement. The applicant must execute requirement within the timeframe set by ability to issue Qualified Equity the Notice of Allocation and return it to the Fund, the Fund reserves the right, in Investments to investors, until said prior the Fund. By executing a Notice of its sole discretion, to terminate and awardee or Allocatee has submitted a Allocation, the Allocatee agrees that, if rescind the Notice of Allocation and the allocation made under this NOAA. complete and timely report prior to entering into an Allocation demonstrating full compliance with said 2. Pending resolution of Agreement with the Fund, information agreement within a timeframe set by the noncompliance: If an applicant is a (including administrative errors) comes Fund. Further, if at any time prior to prior awardee or Allocatee under any to the attention of the Fund that either entering into an Allocation Agreement Fund program and if: (i) It has adversely affects the Allocatee’s through this NOAA, the Fund has made submitted complete and timely reports eligibility for an award, or adversely a final determination that another entity to the Fund that demonstrate affects the Fund’s evaluation or scoring that Controls the Allocatee, is of the Allocatee’s application, or noncompliance with a previous Controlled by the applicant or shares indicates fraud or mismanagement on assistance, award or Allocation common management officials with the the part of the Allocatee, the Fund may, Agreement; and (ii) the Fund has yet to Allocatee (as determined by the Fund), in its discretion and without advance make a final determination as to is a prior Fund awardee or Allocatee notice to the Allocatee, terminate the whether the entity is in default of its under any Fund program, and is in Notice of Allocation or take such other previous assistance, award or Allocation default of a previously executed actions as it deems appropriate. Agreement, the Fund reserves the right, assistance, allocation or award Moreover, by executing a Notice of in its sole discretion, to delay entering agreement(s) and has provided written Allocation, an Allocatee agrees that, if into an Allocation Agreement and/or to notification of such determination to the prior to entering into an Allocation impose limitations on the Allocatee’s defaulting entity, the Fund reserves the Agreement with the Fund, the Fund ability to issue Qualified Equity right, in its sole discretion, to delay determines that the Allocatee is not in Investments to investors, pending full entering into an Allocation Agreement compliance with the terms of any prior resolution, in the sole determination of and/or to impose limitations on the assistance agreement, award agreement, the Fund, of the noncompliance. Allocatee’s ability to issue Qualified and/or Allocation Agreement entered Further, if another entity that Controls Equity Investments to investors, until into with the Fund, the Fund may, in its the applicant, is Controlled by the said prior awardee or Allocatee has discretion and without advance notice applicant or shares common submitted a complete and timely report to the Allocatee, either terminate the management officials with the applicant demonstrating full compliance with said Notice of Allocation or take such other (as determined by the Fund), is a prior agreement within a timeframe set by the actions as it deems appropriate. The Fund awardee or Allocatee and if such Fund. If said prior awardee or Allocatee Fund reserves the right, in its sole entity: (i) Has submitted complete and is unable to meet this requirement, the discretion, to rescind the allocation and timely reports to the Fund that Fund reserves the right, in its sole the Notice of Allocation if the Allocatee demonstrate noncompliance with a discretion, to terminate and rescind the fails to return the Notice of Allocation, previous assistance, award or Allocation Notice of Allocation and the allocation signed by the authorized representative Agreement; and (ii) the Fund has yet to made under this NOAA. of the Allocatee, along with any other make a final determination as to 4. Termination in default: If, within requested documentation, by the whether the entity is in default of its the 12-month period prior to entering deadline set by the Fund. previous assistance, award or Allocation into an Allocation Agreement through 1. Failure to meet reporting Agreement, the Fund reserves the right, this NOAA, the Fund has made a final requirements: If an Allocatee, or an in its sole discretion, to delay entering determination that an Allocatee that is entity that Controls the Allocatee, is into an Allocation Agreement and/or to a prior Fund awardee or Allocatee Controlled by the Allocatee or shares impose limitations on the Allocatee’s under any Fund program whose award common management officials with the ability to issue Qualified Equity or allocation was terminated in default Allocatee (as determined by the Fund) Investments to investors, pending full of such prior agreement and the Fund is a prior Fund awardee or Allocatee resolution, in the sole determination of has provided written notification of under any Fund program and is not the Fund, of the noncompliance. If the such determination to such current on the reporting requirements prior awardee or Allocatee in question organization, the Fund reserves the set forth in the previously executed is unable to satisfactorily resolve the right, in its sole discretion, to delay assistance, allocation or award issues of noncompliance, in the sole entering into an Allocation Agreement agreement(s), as of the date of the Notice determination of the Fund, the Fund and/or to impose limitations on the of Allocation, the Fund reserves the reserves the right, in its sole discretion, Allocatee’s ability to issue Qualified
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Equity Investments to investors. transferees, if any): (i) Is duly formed shall further describe the Allocatee’s Further, if within the 12-month period and in good standing in the jurisdiction reporting requirements. prior to entering into an Allocation in which it was formed and/or operates; The Fund reserves the right, in its sole Agreement through this NOAA, the (ii) has the authority to enter into the discretion, to modify these reporting Fund has made a final determination Allocation Agreement and undertake requirements if it determines it to be that another entity that Controls the the activities that are specified therein; appropriate and necessary; however, Allocatee, is Controlled by the Allocatee (iii) has no pending or threatened such reporting requirements will be or shares common management officials litigation that would materially affect its modified only after due notice to with the Allocatee (as determined by the ability to enter into and carry out the Allocatees. Fund), is a prior Fund awardee or activities specified in the Allocation VII. Agency Contacts Allocatee under any Fund program Agreement; and (iv) is not in default of whose award or allocation was its articles of incorporation, bylaws or The Fund will provide programmatic terminated in default of such prior other organizational documents, or any and information technology support agreement, and the Fund has provided agreements with the Federal related to the allocation application written notification of such government. between the hours of 9 a.m. and 5 p.m. determination to the defaulting entity, If an Allocatee identifies Subsidiary e.t. through October 4, 2004. The Fund the Fund reserves the right, in its sole transferees, the Fund reserves the right will not respond to phone calls or e- discretion, to delay entering into an to require an Allocatee to provide mails concerning the application that Allocation Agreement and/or to impose supporting documentation evidencing are received after 5 p.m. e.t. on October limitations on the Allocatee’s ability to that it Controls such entities prior to 4, 2004, until after the allocation issue Qualified Equity Investments to entering into an Allocation Agreement application deadline of October 6, 2004. investors. with the Allocatee and its Subsidiary Applications and other information regarding the Fund and its programs B. Allocation Agreement transferees. The Fund reserves the right, in its sole discretion, to rescind its may be obtained from the Fund’s Web Each applicant that is selected to Notice of Allocation if the Allocatee site at http://www.cdfifund.gov. The receive a NMTC Allocation (including Fund will post on its website responses the applicant’s Subsidiary transferees) fails to return the Allocation Agreement, signed by the authorized representative to questions of general applicability must enter into an Allocation regarding the NMTC Program. Agreement with the Fund. The of the Allocatee, and/or provide the Allocation Agreement will set forth Fund with any other requested A. Information Technology Support documentation, within the deadlines set certain required terms and conditions of Technical support can be obtained by by the Fund. the NMTC Allocation which may calling (202) 622–2455 or by e-mail at include, but not be limited to, the C. Fees [email protected]. People who following: (i) The amount of the have visual or mobility impairments The Fund reserves the right, in awarded NMTC Allocation; (ii) the that prevent them from accessing the accordance with applicable Federal law approved uses of the awarded NMTC Low-Income Community maps using the and if authorized, to charge allocation Allocation (e.g., loans to or equity Fund’s Web site should call (202) 622– reservation and/or compliance investments in Qualified Active Low- 2455 for assistance. These are not toll monitoring fees to all entities receiving Income Businesses or loans to or equity free numbers. investments in other CDEs); (iii) the NMTC Allocations. Prior to imposing approved service area(s) in which the any such fee, the Fund will publish B. Programmatic Support proceeds of Qualified Equity additional information concerning the If you have any questions about the Investments may be used; (iv) the time nature and amount of the fee. programmatic requirements of this period by which the applicant may D. Reporting NOAA, contact the Fund’s NMTC obtain Qualified Equity Investments Program Manager by e-mail at from investors; and (v) reporting The Fund will collect information, on [email protected], by telephone at requirements for all applicants receiving at least an annual basis, from all (202) 622–6355, by facsimile at (202) NMTC Allocations. If an applicant has applicants that are awarded NMTC 622–7754, or by mail at CDFI Fund, 601 represented in its NMTC allocation Allocations and/or are recipients of 13th Street, NW., Suite 200 South, application that it intends to invest Qualified Low-Income Community Washington, DC 20005. These are not substantially all of the proceeds from its Investments, including such audited toll-free numbers. investors in businesses in which financial statements and opinions of persons unrelated to the applicant hold counsel as the Fund deems necessary or C. Administrative Support a majority equity interest, the Allocation desirable, in its sole discretion. The If you have any questions regarding Agreement will contain a covenant Fund will use such information to the administrative requirements of this whereby said applicant agrees that it monitor each Allocatee’s compliance NOAA, contact the Fund’s Grants will invest substantially all of said with the provisions of its Allocation Management and Compliance Manager proceeds in businesses in which Agreement and to assess the impact of by e-mail at [email protected], by persons unrelated to the applicant hold the NMTC Program in Low-Income telephone at (202) 622–8226, by a majority equity interest. Communities. The Fund may also facsimile at (202) 622–6453, or by mail In addition to entering into an provide such information to the IRS in at CDFI Fund, 601 13th Street, NW., Allocation Agreement, each applicant a manner consistent with IRC § 6103 so Suite 200 South, Washington, DC 20005. selected to receive a NMTC Allocation that the IRS may determine, among These are not toll free numbers. must furnish to the Fund an opinion other things, whether the Allocatee has from its legal counsel, the content of used substantially all of the proceeds of D. IRS Support which will be further specified in the each Qualified Equity Investment raised For questions regarding the tax Allocation Agreement, to include, through its NMTC Allocation to make aspects of the NMTC Program, contact among other matters, an opinion that an Qualified Low-Income Community Branch Five, Office of the Associate applicant (and its Subsidiary Investments. The Allocation Agreement Chief Counsel (Passthroughs and
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Special Industries), IRS, by telephone at ACTION: Notice and request for Estimated Number of Responses: (202) 622–3040, by facsimile at (202) comments. 8,368,447. 622–4753, or by mail at 1111 SUMMARY: The Department of the Estimated Time Per Responses: 1 hr., Constitution Avenue, NW., Attn: 1 min. CC:PSI:5, Washington, DC 20224. These Treasury, as part of its continuing effort are not toll free numbers. to reduce paperwork and respondent Estimated Total Annual Burden burden, invites the general public and Hours: 8,535,816. E. Legal Counsel Support other Federal agencies to take this The following paragraph applies to all If you have any questions or matters opportunity to comment on proposed of the collections of information covered that you believe require response by the and/or continuing information by this notice: Fund’s Office of Legal Counsel, please collections, as required by the refer to the document titled ‘‘How to Paperwork Reduction Act of 1995, An agency may not conduct or Request a Legal Review’’, found on the Public Law 104–13(44 U.S.C. sponsor, and a person is not required to Fund’s Web site at http:// 3506(c)(2)(A)). Currently, the IRS is respond to, a collection of information www.cdfifund.gov. Requests for legal soliciting comments concerning Form unless the collection of information reviews must be received by the Fund 8867, Paid Preparer’s Earned Income displays a valid OMB control number. no later than September 7, 2004, or by Credit Checklist. Books or records relating to a collection such alternative date as may be agreed DATES: Written comments should be of information must be retained as long to by the Fund. received on or before October 12, 2004 as their contents may become material VIII. Information Sessions to be assured of consideration. in the administration of any internal ADDRESSES: Direct all written comments revenue law. Generally, tax returns and In connection with this NOAA, the tax return information are confidential, Fund intends to broadcast a no fee, to Glenn P. Kirkland, Internal Revenue as required by 26 U.S.C. 6103. interactive video teleconference Service, room 6411, 1111 Constitution information session on August 24, 2004, Avenue NW., Washington, DC 20224. Request for Comments: Comments from 1 p.m. to 5 p.m. e.t. Registration is FOR FURTHER INFORMATION CONTACT: submitted in response to this notice will required, as the video teleconference Requests for additional information or be summarized and/or included in the information session will be broadcast to copies of the form and instructions request for OMB approval. All secured federal facilities. The video should be directed to R. Joseph Durbala, comments will become a matter of teleconference information session will at Internal Revenue Service, room 6411, public record. Comments are invited on: be produced in Washington, DC, and 1111 Constitution Avenue NW., (a) Whether the collection of will be downlinked via satellite to local Washington, DC 20224, or at (202) 622– information is necessary for the proper Department of Housing and Urban 3634, or through the internet at performance of the functions of the Development offices in certain cities. [email protected]. agency, including whether the For further information on the video SUPPLEMENTARY INFORMATION: information shall have practical utility; teleconference information session, Title: Paid Preparer’s Earned Income (b) the accuracy of the agency’s estimate locations, or to register, please visit the Credit Checklist. of the burden of the collection of Fund’s Web site at http:// OMB Number: 1545–1629. information; (c) ways to enhance the www.cdfifund.gov or call the Fund at Form Number: 8867. quality, utility, and clarity of the (202) 622–9046. Abstract: Form 8867 helps preparers information to be collected; (d) ways to Authority: 26 U.S.C. 45D; 31 U.S.C. 321; 26 meet the due diligence requirements of minimize the burden of the collection of CFR 1.45D–1T. Internal Revenue Code section 6695(g), information on respondents, including Dated: August 4, 2004. which was added by section 1085(a)(2) through the use of automated collection Arthur A. Garcia, of the Taxpayer Relief Act of 1997. Paid techniques or other forms of information Director, Community Development Financial preparers of Federal income tax returns technology; and (e) estimates of capital Institutions Fund. or claims for refund involving the or start-up costs and costs of operation, [FR Doc. 04–18448 Filed 8–11–04; 8:45 am] earned income credit (EIC) must meet maintenance, and purchase of services BILLING CODE 4810–70–P the due diligence requirements in to provide information. determining if the taxpayer is eligible for the EIC and the amount of the credit. Approved: August 6, 2004. DEPARTMENT OF THE TREASURY Failure to do so could result in a $100 Glenn P. Kirkland, penalty for each failure. Completion of IRS Reports Clearance Officer. Internal Revenue Service Form 8867 is one of the due diligence [FR Doc. 04–18477 Filed 8–11–04; 8:45 am] requirements. Proposed Collection; Comment BILLING CODE 4830–01–P Request for Form 8867 Current Actions: There are no changes being made to the form at this time. AGENCY: Internal Revenue Service (IRS), Affected Public: Business or other for- Treasury. profit organizations.
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Corrections Federal Register Vol. 69, No. 155
Thursday, August 12, 2004
This section of the FEDERAL REGISTER Wednesday, July 28, 2004, make the Thursday, July 15, 2004, make the contains editorial corrections of previously following correction: following correction: published Presidential, Rule, Proposed Rule, and Notice documents. These corrections are §39.13 [Corrected] §1.1045–1 [Corrected] prepared by the Office of the Federal On page 44927, in the first column, in 1. On page 42376, in the third Register. Agency prepared corrections are § 39.13, after paragraph (h)(2) add the column, in paragraph (f), in the last line, issued as signed documents and appear in folowing equation: the appropriate document categories ‘‘§601.601(d)(2)(ii)(b)’’ should read,
X X X XL=−+++1 1 2 3 ..... rc elsewhere in the issue. L1 L2 L3 ‘‘§601.601(d)(2)(ii)(b)’’. [FR Doc. C4–16548 Filed 8–11–04; 8:45 am] 2. On page 42377, in the second BILLING CODE 1505–01–D column, in Example 5., in the third line, DEPARTMENT OF TRANSPORTATION ‘‘Example 4’’ should read, ‘‘Example 4’’. Federal Aviation Administration DEPARTMENT OF THE TREASURY 3. On the same page, in the second column, in Example 7., in the fourth 14 CFR Part 39 Internal Revenue Service line, ‘‘Example 4’’ should read, ‘‘Example 4’’. [Docket No. 2003–NE–38–AD; Amendment 26 CFR Part 1 39–13736; AD 2004–15–02] [FR Doc. C4–15964 Filed 8–11–04; 8:45 am] [REG–150562–03] RIN 2120–AA64 BILLING CODE 1505–01–D RIN 1545–BC67 Airworthiness Directives; Rolls-Royce plc RB211 Trent 800 Series Turbofan Section 1045 Application to Engines Partnerships Correction Correction In rule document 04–16548 beginning In proposed rule document 04–15964 on page 44925 in the issue of beginning on page 42370 in the issue of
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Part II
Department of Commerce Patent and Control Office
37 CFR Parts 1, 5, 10, 11, and 41 Rules of Practice Before the Board of Patent Appeals and Interferences; Final Rule
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DEPARTMENT OF COMMERCE change cross-references to Board Rule 191 is amended to direct proceedings. appellants under 35 U.S.C. 134(a) or (b) Patent and Trademark Office Rules 17(b)–(d) and (h) are revised to to part 41. remove the Board fees, which will be Rules 192–196 are removed and 37 CFR Parts 1, 5, 10, 11, and 41 relocated to § 41.20. reserved. Rule 197 is amended by changing its RIN 0651–AB32 Rules 48(a)–(c) and (i) are revised, and title to ‘‘Return of jurisdiction from the Rule 48(j) added, to consolidate the Board of Patent Appeals and Rules of Practice Before the Board of cross-reference correction of Patent Appeals and Interferences Interferences; termination of inventorship for applications in proceedings’’ to reflect the two AGENCY: United States Patent and contested cases before the Board. remaining paragraphs of this section. Trademark Office, Commerce. Rules 55(a)(3) and (a)(4), and 136(b) The subject matter of paragraph (b) is ACTION: Final rule. are revised to eliminate the cross- moved to § 41.52 and the subject matter references to Board rules. of paragraph (c) is moved to paragraph SUMMARY: The Under Secretary of Rule 116 is amended to limit (b) of Rule 197. Paragraph (a) is Commerce for Intellectual Property and amendments after a final rejection or amended to return of jurisdiction of the Director of the United States Patent and other final action (Rule 113) in an involved application or patent under ex Trademark Office consolidates and application or in an ex parte parte reexamination proceeding to the simplifies the rules governing practice reexamination filed under Rule 510, or examiner. Rule 41(d)(2), Fed. R. App. before the Board of Patent Appeals and after an action closing prosecution (Rule Procedure, controls when the mandate Interferences to reflect developments in 949) in an inter partes reexamination of the Court of Appeals will issue in the case law, legislation, and administrative filed under Rule 913, to such event that a party filed a petition for practice. amendments filed before or with any writ of certiorari to the United States DATES: Effective date: September 13, appeal to the Board under § 41.31 or Supreme Court. Unless a party 2004. § 41.61. Amendments after appeal petitioning for a writ of certiorari seeks currently treated under Rule 116 are and obtains a stay of the appellate FOR FURTHER INFORMATION CONTACT: moved to §§ 41.33 and 41.63. Pursuant court’s mandate, proceedings will be Appeals: Jeffrey V. Nase or William F. to § 41.33(a), amendments filed after considered terminated with the issuance Smith, 703–308–9797. appeal and prior to the filing of the of the mandate, as noted in Rule Otherwise: Richard Torczon, 703– appeal brief will be treated under the 197(b)(2). 308–9797. same standard as Rule 116. The section Rule 198 is amended by changing its SUPPLEMENTARY INFORMATION: title is revised to reflect the scope of the title to ‘‘Reopening after a final decision Background rule more accurately. of the Board of Patent Appeals and Interferences’’ to reflect the substance of The Board of Patent Appeals and Rule 116(d) is amended to permit only an amendment canceling claims, the section and to clarify that it applies Interferences (Board) has significantly when a decision by the Board of Patent overhauled its operations to address where such cancellation does not affect the scope of any other pending claim in Appeals and Interferences on appeal has concerns about the duration of become final for judicial review. proceedings before the Board. This final the proceeding, to be made in an inter partes reexamination proceeding after Rule 324(a) and (c) are revised, and rule reflects these new procedures. A Rule 324(d) added, to consolidate cross- notice of proposed rule making on this the right of appeal notice has issued under Rule 953, except as provided in references to correction of inventorship topic was published in the Federal for patents in contested cases before the Register (68 FR 66648, Nov. 26, 2003) Rule 981 or as permitted by § 41.77(b)(1). Board. and in the Official Gazette of the United Rule 959 is revised to direct inter States Patent and Trademark Office Rule 116(e) is added to set forth a partes reexamination participants to (1277 OG 139, Dec. 23, 2003). Seventeen standard for treatment of an affidavit or part 41 for information about appeals in comments have been received in other evidence submitted after a final such proceedings. response to that notice. rejection or other final action (Rule 113) Rules 961–977 are removed to in an application or in an ex parte consolidate inter partes reexamination Explanation of changes reexamination filed under Rule 510, or appeal information in part 41. In keeping with long-standing patent in an action closing prosecution (Rule Rule 979 is amended by changing its practice, rules in title 37, part 1, of the 949) in an inter partes reexamination title to ‘‘Return of Jurisdiction from the Code of Federal Regulations are filed under Rule 913, but before or with Board of Patent Appeals and denominated ‘‘Rule x’’ in this any appeal (§ 41.31 or § 41.61). The Interferences; termination of supplementary information. standard would be that such an affidavit proceedings’’ to reflect the two Rules 1(a)(1)(iii), 5(e), and or other evidence could be admitted paragraphs of this section. Most of the 8(a)(2)(i)(B), and subpart E of part 1, are upon a showing of good and sufficient subject matter of current paragraphs (a)– removed to consolidate interference reasons why the affidavit or other (g) is moved to §§ 41.79, 41.81 and information in part 41, subparts D and evidence is necessary and was not 41.83. Paragraph (a) is amended to recite E. earlier presented. This standard is that jurisdiction over an inter partes Rules 1(a)(1)(ii); 4(a)(2); 6(d)(9); currently in effect under Rule 195 for an reexamination proceeding passes to the 8(a)(2)(i)(C); 9(g); 11(e); 17(b); 36; affidavit or other evidence submitted examiner after a decision by the Board 59(a)(1); 103(g); 112; 113(a); 114(d); after appeal. of Patent Appeals and Interferences 131(a)(1); 136(a)(1) and (a)(2); 181(a)(3); Rule 116(f) is added to prohibit upon transmittal of the file to the 191; 248(c); 292(a) and (c); 295(b); affidavits and other evidence in an inter examiner, subject to each appellant’s 302(b); 303(c); 304(a)(1) and (a)(2); partes reexamination proceeding after right of appeal or other review, for such 322(a)(3); 323; 324; 565(e); 701(c)(2)(ii); the right of appeal notice under Rule further action as the condition of the 703(a)(4), (b)(3)(ii), (b)(4), (d)(2), and (e); 953, except as provided in Rule 981 or inter partes reexamination proceeding 704(c)(9); 959; and 993 are revised to as permitted by § 41.77(b)(1). may require, to carry into effect the
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decision of the Board of Patent Appeals The definition of ‘‘Board member’’ providing rules for extensions of time and Interferences. Paragraph (b) is follows the definition in 35 U.S.C. 6(a), and for acceptance of untimely papers. amended to state that upon decision on under which the Under Secretary of Section 41.4(c) points parties to the appeal before the Board of Patent Commerce for Intellectual Property and timeliness rules that are related to Board Appeals and Interferences, if no further Director of the United States Patent and proceedings, but not within the scope of appeal has been taken (Rule 983), the Trademark Office, the Deputy Under the Board rules. inter partes reexamination proceeding Secretary of Commerce for Intellectual Section 41.5 provides a limited will be terminated and the Director will Property and Deputy Director of the delegation to the Board under 35 U.S.C. issue a certificate under Rule 997. United States Patent and Trademark 2(b)(2) and 32 to regulate the conduct of Rule 981 is amended by changing its Office, the Commissioner for Patents, counsel in Board proceedings. Section title to ‘‘Reopening after a final decision and the Commissioner for Trademarks 41.5(b) delegates to the Board the of the Board of Patent Appeals and are ex officio members of the Board. authority to conduct counsel Interferences’’ to better reflect the The phrase ‘‘contested case’’ includes disqualification proceedings while the substance of the section and to clarify patent interferences (35 U.S.C. 135(a)) Board has jurisdiction over a that it applies when a decision by the and proceedings with interference-based proceeding. Board of Patent Appeals and procedures (42 U.S.C. 2182 and Section 41.6(a) relocates into part 41 Interferences on appeal has become 2457(d)). the portions of Rule 14(e) that apply to final for judicial review. The term ‘‘final’’ is defined pursuant the Board. Under § 41.6(a)(1) publicly Under 37 CFR 5.3, no interference to 5 U.S.C. 704 to assist parties in available materials continue to be will be declared with an application determining when a Board action is ripe publicly available. Section 41.6(a)(2) under a national secrecy order. for judicial review. sets forth the basis for making a In the enrollment and discipline The definition of ‘‘hearing’’ reflects determination under 35 U.S.C. 122(a) rules, 37 CFR 10.23(c)(7) and 11.6(d) are the holding of In re Bose Corp., 772 F.2d that special circumstances justify the amended to change the cross-references 866, 869, 227 USPQ 1, 4 (Fed. Cir. 1985) publication of a Board action. to the interference rules. that a party is entitled to judicial Section 41.6(b) generalizes to all A new part 41 consolidates rules consideration of properly raised issues, Board proceedings the practice under relating to Board practice and simplifies but is not entitled to an oral argument Rule 11(e) of making the record of most reference to such practices. The Board or consideration of improperly raised interference proceedings publicly will continue the practice used in part issues. available eventually, although that 1 of this title of citing sections without The definitions of ‘‘panel’’ and ‘‘panel availability might not occur until an the part number. In proceedings before proceeding’’ reflects the minimum involved patent application becomes the Board, a party may cite ‘‘§ 41.x’’ as quorum established in 35 U.S.C. 6(b), available. ‘‘Board Rule x’’. which reserves action on patentability Section 41.7 recodifies the current Subpart A states policies, practices, and priority to panels. 35 U.S.C. 6(b). practice of Rule 618 regarding duplicate and definitions common to all The term ‘‘party’’ sets forth a generic papers and the expunging of papers, but proceedings before the Board. term for entities acting in a Board generalizes it to all Board proceedings. Section 41.1 sets forth general proceeding. Section 41.8(a) reflects the practice principles for part 41. Section 41.1(a) The delegation of petition authority to under Rules 192(c)(1) and 602 regarding defines the scope of rules. Section the Chief Administrative Patent Judge in disclosure of the real parties-in-interest. 41.1(b) mandates that the Board’s rules § 41.3(a) is new as a rule, but follows a Section 41.8(b) requires parties to be construed to achieve just, speedy, delegation already published in the provide notice of related proceedings. and inexpensive resolutions of all Board Manual of Patent Examining Procedure Section 41.9 follows Rule 643 proceedings, following the model of (MPEP) at § 1002.02(f). regarding action by an assignee to the Rule 601 and Federal Rule of Civil Under § 41.3(b)(1) decisions exclusion of an inventor, but generalizes Procedure 1. Section 41.1(c) explicitly committed by statute to the Board are it to all Board proceedings. extends the requirement for decorum not subject to petitions for supervisory Section 41.10 adds correspondence under Rule 3 to Board proceedings, review. Review of such decisions come addresses for Board proceedings. including dealings with opposing through a request for rehearing or Section 41.11 codifies existing parties. through judicial review. The provision interference practice prohibiting ex Section 41.2 sets forth definitions for in § 41.3(b)(2) for petitions in contested parte communications about a contested Board proceedings under part 41. The cases to be decided by other officials case with an official actually conducting preamble to § 41.2 is based on the reflects the MPEP’s designation of other the proceeding, but generalizes the preamble of Rule 601, which cautions actions typical in the ordinary course of practice to include inter partes that context may give a defined word a Board proceedings as ‘‘petitions’’. See reexamination appeals as well. different meaning. MPEP § 1002.02(g) (various procedural Section 41.12 codifies existing The definition of ‘‘Board’’ covers decisions in interferences). interference practice regarding the three distinct situations. First, for the Section 41.3(c) reflects current citation of authority but generalizes the purposes of a final agency action practice in requiring payment of a practice to all Board proceedings. committed to a panel of Board members, standard petition fee. Section 41.20 consolidates the rules the definition is identical in scope to 35 Section 41.3(d) reflects the current on fees associated with Board practice. U.S.C. 6(b). Second, the definition practice of not staying any action for a Rules 22, 23, and 25–28, which govern includes action by the Chief petition for supervisory review in Rule fee practice before the Office generally, Administrative Patent Judge in matters 181(f). continue to apply in Board proceedings. delegated in these rules to the Chief Section 41.3(e) sets times for filing Section 41.20(a) sets forth the petition Administrative Patent Judge. Third, the petitions. As with Rule 181(f), failure to fee, while paragraph (b) sets forth definition recognizes that non-final file a timely petition is sufficient basis appeals-related fees. actions are often performed by officials for dismissing or denying a motion. Subpart B is added to set forth rules other than a panel or the Chief Section 41.4(a) and (b) follow the for the ex parte appeal under 35 U.S.C. Administrative Patent Judge. requirements of Rules 136(b) and 645 in 134 of a rejection in either a national
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application for a patent, an application of filing a brief pursuant to § 41.37 may (5) In paragraph (c)(1)(ii), for reissue of a patent, or an ex parte be admitted if the examiner determines identification is required of all other reexamination proceeding to the Board. that the affidavits or other evidence prior and pending appeals, interferences Section 41.30 sets forth definitions for overcomes all rejections under appeal or judicial proceedings known to Board proceedings under subpart B of and that there is a showing of good and appellant, the appellant’s legal part 41. The preamble to § 41.30 is sufficient reasons why the affidavit or representative, or assignee which may based on a similar provision in the other evidence is necessary and was not be related to, directly affect or be preamble of former Rule 601. The term earlier presented. Paragraph (d)(2) directly affected by or have a bearing on ‘‘proceeding’’ sets forth a generic term provides that all other affidavits or other the Board’s decision in the pending for a national application for a patent, evidence filed after the date of filing an appeal, as well as to set forth a an application for reissue of a patent, appeal pursuant to § 41.31(a)(1)–(a)(3) mechanism for complying with § 41.8(b) and an ex parte reexamination will not be admitted except as permitted in an appeal to the Board. proceeding. The term ‘‘applicant’’ sets by §§ 41.39(b)(1), 41.50(a)(2)(i) and (6) In paragraph (c)(1)(iii), both a forth a generic term for either the 41.50(b)(1). Paragraph (d) replaces the statement of the status of all the claims applicant in a national application for a former practice of permitting such in the proceeding (e.g., rejected, allowed patent or the applicant in an application evidence based on a showing of good or confirmed, withdrawn, objected to, for reissue of a patent. The term and sufficient reasons why such canceled) and an identification of those ‘‘owner’’ sets forth a shorthand evidence was not earlier presented set claims that are being appealed is reference to the owner of the patent forth in former Rule 195. The Office required. undergoing ex parte reexamination believes that prosecution should occur (7) In paragraph (c)(1)(v), a concise under Rule 510. before the examiner prior to an appeal explanation of the invention is required Section 41.31 is added to generally being filed, not after the case has been for each of the independent claims incorporate the requirements of former appealed pursuant to § 41.31(a)(1)– involved in the appeal, which Rule 191(a)–(d). Paragraph (a) is (a)(3). explanation shall refer to the subdivided into three parts to improve Section 41.35 is added to generally specification by page and line number, readability. Paragraph (d) is amended to incorporate the requirements of former and to the drawings, if any, by reference refer only to the time periods referred to Rule 191(e). In addition, this section characters. For each independent claim in paragraphs (a)(1)–(a)(3) of this makes clear that jurisdiction over an involved in the appeal and for each section, while the current extension of application may be relinquished by the dependent claim argued separately time requirements for Rules 192, 193, Board and the application returned to under the provisions of paragraph 194, 196 and 197, formerly provided in the examining operation to permit (c)(1)(vii) of this section, every means Rule 191(e), is relocated to §§ 41.37, processing to be completed by the plus function and step plus function as 41.41, 41.47, 41.50 and 41.52. examining operation before the Board permitted by 35 U.S.C. 112, sixth Section 41.33 is added to replace the takes up the appeal for decision. This is paragraph, must be identified and the requirements of former Rules 116 and consistent with the present practice of structure, material, or acts described in 195. Paragraph (a) provides that returning an appealed application to the the specification as corresponding to amendments filed after the date of filing examining operation where some matter each claimed function be set forth with an appeal pursuant to § 41.31(a)(1)– requiring attention has been identified reference to the specification by page (a)(3) and prior to the date a brief is filed prior to assignment of the appeal and line number, and to the drawing, if pursuant to § 41.37 may be admitted as number and docketing of the appeal. In any, by reference characters. The former provided in § 1.116. Thus, amendments addition, the Board is permitted to take requirement of Rule 192(c)(5) to set after final but prior to appeal and other appropriate action to complete the forth a concise explanation of the amendments filed after appeal but prior file. invention defined in the claims to the date the brief is filed will be Section 41.37 is added to generally involved in the appeal by reference to treated under the same standard (i.e, incorporate the requirements of former the specification by page and line § 1.116). Paragraph (b) provides that Rule 192. In addition, the following number, and to the drawings, if any, by amendments filed on or after the date of changes have been made: reference characters was not being filing a brief pursuant to § 41.37 may be (1) The title of the section has been followed in a great number of briefs admitted: (1) to cancel claims, where changed from ‘‘Appellant’s brief’’ to before the Board. such cancellation does not affect the ‘‘Appeal brief’’. (8) In paragraph (c)(1)(vi), a concise scope of any other pending claim in the (2) In paragraph (a), one copy of the statement listing each ground of proceeding, or (2) to rewrite dependent brief is required rather than three copies rejection presented for review is claims into independent form. A consistent with the Office’s move to an required rather than issues for review. dependent claim is rewritten into electronic file wrapper. An example of a concise statement is independent form by including all of (3) In paragraph (a), the brief is ‘‘Claims 1 to 10 stand rejected under 35 the limitations of the base claim and any required to be filed within two months U.S.C. 102(b) as being anticipated by intervening claims. Thus, no limitation from the date of the notice of appeal U.S. Patent No. X.’’ of a dependent claim can be excluded under § 41.31 even if the time allowed (9) The grouping of claims in rewriting that claim into independent for reply to the action from which the requirement set forth in former Rule form. Paragraph (c) provides that all appeal was taken is later, which overall 192(c)(7) is removed. The general other amendments filed after the date of simplifies docketing of the due date. purpose served by former Rule 192(c)(7) filing an appeal pursuant to (4) In paragraph (c)(1)(i), a statement is addressed in § 41.37(c)(1)(viii). The § 41.31(a)(1)–(a)(3) will not be admitted is required in the brief identifying by existing grouping of claims requirement except as permitted by §§ 41.39(b)(1), name the real party in interest even if has led to many problems such as (i) 41.50(a)(2)(i), 41.50(b)(1) and 41.50(c). the party named in the caption of the Grouping of claims across multiple Paragraph (d)(1) provides that affidavits brief is the real party in interest. This rejections (e.g., claims 1–9 rejected or other evidence filed after the date of provides appellant the necessary under 35 U.S.C. 102 over A while filing an appeal pursuant to mechanism for complying with § 41.8(a) claims 10–15 are rejected under 35 § 41.31(a)(1)–(a)(3) and prior to the date in an appeal to the Board. U.S.C. 103 over A and the appellant
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states that claims 1–15 are grouped optional subheadings would be Claim 1, of rejection in the examiner’s answer). together); (ii) Claims being grouped Claim 2, and Claim 3. Under each Because the current appeal rules only together but argued separately (e.g., subheading the appellant would present allow the examiner to make a new claims 1–9 rejected under 35 U.S.C. the argument for patentability of that ground by reopening prosecution, some § 102 over A, the appellant groups claim. examiners have allowed cases to go claims 1–9 together but then argues the (11) Paragraph (c)(1)(vii) states that forward to the Board without addressing patentability of claims 1 and 5 ‘‘Merely pointing out differences in the new arguments. Thus, the revision separately); and (iii) examiners what the claims cover is not an would improve the quality of disagreeing with the appellant’s argument as to why the claims are examiner’s answers and reduce grouping of claims. separately patentable’’, a statement in pendency by providing for the inclusion (10) In paragraph (c)(1)(vii), any slightly different form appeared in of the new ground of rejection in an arguments or authorities not included in former Rule 192(c)(7). examiner’s answer without having to the brief or a reply brief filed pursuant (12) Paragraph (c)(1)(vii) eliminates reopen prosecution. By permitting to § 41.41 will be refused consideration subparagraphs (i) through (v) of former examiners to include a new ground of by the Board, unless good cause is Rule 192(c)(8) which related to the rejection in an examiner’s answer, shown (requirement found in former manner in which arguments were to be newly presented arguments can now be Rule 192(a)), and a separate heading is made. Although they provided useful addressed by a new ground of rejection required for each ground of rejection in advice as to what an effective argument in the examiner’s answer when place of the previous grouping of claims ought to include, these provisions have appropriate. Furthermore, if new section of the brief. For each ground of often been ignored by appellants and, arguments can now be addressed by the rejection applying to two or more for the most part, have not been examiner by incorporating a new claims, the claims may be argued enforced as set forth in paragraph (d) of ground of rejection in the examiner’s separately or as a group. When an that rule. answer, the new arguments may be able (13) Paragraph (c)(1)(ix) is added to appellant argues as a group multiple to be addressed without reopening require appellant to include an evidence claims subject to the same ground of prosecution and thereby decreasing appendix of any evidence relied upon pendency. rejection, the Board may select a single by appellant in the appeal with a It is envisioned that new grounds of claim from that group of claims and statement setting forth where that rejection in examiner’s answers would treat its disposition of a ground of evidence was entered in the record by be rare, rather than a routine rejection of that claim as applying to the the examiner so that the Board will be occurrence. The Office plans to issue disposition of that ground of rejection of able to easily reference such evidence instructions that will be incorporated all claims in the group of claims. during consideration of the appeal. into the MPEP requiring that any new Notwithstanding any other provision of (14) Paragraph (c)(1)(x) is added to ground of rejection made by an this paragraph, an appellant’s failure to require appellant to include a related examiner in an answer must be argue separately claims that the proceedings appendix containing copies personally approved by a Technology appellant has grouped together of decisions rendered by a court or the Center Director or designee and that any constitutes a waiver of any argument Board in any proceeding identified new ground of rejection made in an that the Board must consider the pursuant to paragraph (c)(1)(ii) of this answer be prominently identified as patentability of any grouped claim section so that the Board can take into such. It is the further intent of the Office separately. See In re McDaniel, 293 F.3d consideration such decisions. to provide guidance to examiners that 1379, 1384, 63 USPQ2d 1462, 1465–66 (15) Paragraph (c)(2) is added to will also be incorporated into the MPEP (Fed. Cir. 2002) (interpreting former exclude any new or non-admitted as to what circumstances, e.g., Rule 192(c)(7) to require separate amendment, affidavit or other evidence responding to a new argument or new treatment of separately rejected claims). from being included in the brief. evidence submitted prior to appeal, Any claim argued separately should be (16) Paragraph (d) is added to provide would be appropriate for entry of a new placed under a subheading identifying that appellants will be notified of ground of rejection in an examiner’s the claim by number and claims argued reasons for non-compliance and given a answer rather than the reopening of as a group should be placed under a period of time to file an amended brief. prosecution. Where, for example, a new subheading identifying the claims by (17) Paragraph (e) is added to provide argument(s) or new evidence cannot be number. For example, if Claims 1 to 5 notice that the periods set forth in this addressed by the examiner based on the stand rejected under 35 U.S.C. 102(b) as section are extendable under the information then of record, the being anticipated by U.S. Patent No. Y provisions of Rule 136 for patent examiner may need to reopen and appellant is only going to argue the applications and Rule 550(c) for ex parte prosecution rather than apply a new limitations of independent claim 1, and reexamination proceedings. This ground of rejection in an examiner’s thereby group dependent claims 2 to 5 provision appeared in former Rule answer to address the new argument(s) to stand or fall with independent claim 191(d). or new evidence. 1, then one possible heading as required Section 41.39 is added to generally Paragraph (b) of § 41.39 is added to set by this subsection could be Rejection incorporate requirements found in forth the responses an appellant may under 35 U.S.C. 102(b) over U.S. Patent former Rule 193(a). make when an examiner’s answer sets No. Y and the optional subheading Section 41.39(a)(2) is added to permit forth a new ground of rejection. would be Claims 1 to 5. As another a new ground of rejection to be included Appellant is required within two example, where claims 1 to 3 stand in an examiner’s answer eliminating the months from the date of the examiner’s rejected under 35 U.S.C. 102(b) as being former prohibition of new grounds of answer containing a new ground of anticipated by U.S. Patent No. Z and the rejection in examiner’s answers. Many rejection either: appellant wishes to argue separately the appellants are making new arguments (1) To request that prosecution be patentability of each claim, a possible for the first time in their appeal brief reopened by filing a reply under Rule heading as required by this subsection (apparently stimulated by a former 111 with or without amendment or could be Rejection under 35 U.S.C. change to the appeal process that submission of affidavits (Rules 130, 131 102(b) over U.S. Patent No. Z, and the inserted the prohibition on new grounds or 132) or other evidence, which would
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result in prosecution being reopened a Technology Center Director or supervisory patent examiner as before the examiner, or designee. A supplemental examiner’s currently set forth in MPEP 1208.02. (2) To file a reply brief under § 41.41, answer may not include a new ground Paragraph (b) of § 41.43 permits which would act as a request that the of rejection. If a supplemental appellant to file a supplemental reply appeal be maintained. Such a reply brief examiner’s answer is furnished by the brief in response to a supplemental could not be accompanied by any examiner, the appellant is permitted to examiner’s answer within two months amendment, affidavit (Rules 130, 131, or file another reply brief under § 41.41 from the date of the supplemental 132) or other evidence. If such a reply within two months from the date of the examiner’s answer. That two-month brief were accompanied by any supplemental examiner’s answer. time period may be extended under the amendment or evidence, it would be The former prohibition against a provisions of Rule 136(b) for patent treated as a request that prosecution be supplemental examiner’s answer in applications and Rule 550(c) for ex parte reopened before the examiner under other than a remand situation is reexamination proceedings as set forth paragraph (b)(1) of this section. Any removed to permit use of supplemental in § 41.43(c). reply brief would have to specify the examiner’s answers where the examiner Section 41.47 is added to generally error in each new ground of rejection as is responding only to new issues raised incorporate the requirements of former set forth in § 41.37(c)(1)(viii) and should in the reply brief. As a consequence, the Rule 194. In addition: generally follow the other requirements requirements pertaining to appellants (1) Paragraph (b) requires the separate of a brief set forth in § 41.37(c). when prosecution is reopened under paper requesting the oral hearing to be If in response to the examiner’s former Rule 193(b)(2) are removed. captioned ‘‘REQUEST FOR ORAL HEARING’’ and sets forth that such a answer containing a new ground of Section 41.43(a)(1) permits the request can be filed within two months rejection, appellant decides to reopen examiner to furnish a supplemental from the date of the examiner’s answer prosecution of the application before the examiner’s answer to respond to any or supplemental examiner’s answer. examiner, the Office will treat the new issue raised in a reply brief. It decision to reopen prosecution also as a (2) Paragraph (d) is added to set forth should be noted that an indication of a the procedure for handling the request request to withdraw the appeal. If change in status of claims (e.g., that appellant fails to exercise one of the two for oral hearing when an appellant has certain rejections have been withdrawn complied with all the requirements of options within two months from the as a result of a reply brief) is not a date of the examiner’s answer, the paragraph (b) of this section. Since supplemental examiner’s answer and notice to the primary examiner is a appeal will be sua sponte dismissed therefore would not give appellant the (i.e., terminated) as to the claims subject matter internal to the Office, the right to file a reply brief. Such an requirement for notice to the primary to the new ground of rejection. indication of a change in status may be Paragraph (c) of § 41.39 is added to examiner has been removed from the made on form PTOL–90. The Office will provide notice that the period set forth rule. It is anticipated that the primary develop examples to help the examiner in paragraph (b) of this section is examiner will be sent notice of the determine what would or would not be extendable under the provisions of Rule hearing time and date by e-mail. considered a new issue warranting a 136(b) for patent applications and Rule (3) Paragraph (e)(1) is added to supplemental examiner’s answer. An 550(c) for ex parte reexamination specifically provide that at the oral appellant who disagrees with an proceedings. This provision appeared in hearing (i) appellant may only rely on examiner’s decision that a supplemental former Rule 191(d). evidence that has been previously Section 41.41 is added to generally examiner’s answer is permitted under considered by the primary examiner and incorporate requirements found in this rule may petition for review of the present argument that has been relied former Rule 193(b). In addition: decision under Rule 181. Examples of upon in the brief or reply brief except (1) Paragraph (a)(2) is added to make new issues raised in a reply brief as permitted by paragraph (e)(2) of this explicit that a reply brief cannot include include the following: section; (ii) the primary examiner may any new or non-admitted amendment, Example 1: The rejection is under 35 only rely on argument and evidence affidavit or other evidence. U.S.C. 103 over A in view of B. The raised in the answer or a supplemental (2) Paragraph (b) is added to make brief argues that element 4 of reference answer except as permitted by clear that a reply brief not in B cannot be combined with reference A paragraph (e)(2) of this section; and (iii) compliance with paragraph (a) would as it would destroy the function that appellant opens and concludes the not be considered. The examiner would performed by reference A. The reply argument (i.e., the order of the argument notify the appellant in this event. brief argues that B is nonanalogous art at the hearing is: Appellant opens, then (3) Paragraph (c) is added to provide and therefore the two references cannot the primary examiner argues, then the notice that the period set forth in this be combined. appellant concludes presuming that section would be extendable under the Example 2: Same rejection as in appellant has reserved some time for a provisions of Rule 136(b) for patent Example 1. The brief argues only that concluding argument). applications and Rule 550(c) for ex parte the pump means of claim 1 is not taught (4) Paragraph (e)(2) is added to reexamination proceedings. This in the applied prior art. The reply brief specifically provide that upon a provision appeared in former Rule argues that the particular retaining showing of good cause, appellant and/ 191(d). means of claim 1 is not taught in the or the primary examiner may rely on a Section 41.43 is added to permit the applied prior art. new argument based upon a recent examiner to furnish a supplemental Paragraph (a)(1) of § 41.43 also sets relevant decision of either the Board or examiner’s answer to respond to any forth the ability of the examiner to a Federal Court. new issue raised in the reply brief. This withdraw the final rejection and reopen (5) Paragraph (f) is added to would dispense with the need for the prosecution as an alternative to the use incorporate the substance found in Board to remand the proceeding to the of a supplemental examiner’s answer. former Rule 194. Exemplary situations examiner to treat any new issue raised The primary examiner’s decision to where the Board may decide no hearing in the reply brief. The MPEP will withdraw the final rejection and reopen is necessary include those where the provide that each supplemental prosecution to enter a new ground of Board has become convinced, prior to examiner’s answer must be approved by rejection requires approval from the hearing, that an application must be
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remanded for further consideration a specific rejection and that when the Section 41.60 sets forth definitions for prior to evaluating the merits of the opinion of the Board included such a Board proceedings under subpart C of appeal or that the examiner’s position statement, appellant would have the part 41. The preamble to § 41.60 is cannot be sustained in any event. right to amend in conformity therewith. based on a similar provision in the (6) Paragraph (g) is added to provide Such an amendment in conformity with preamble of former Rule 601. The term notice that the periods set forth in this such statement would overcome the ‘‘proceeding’’ provides a shorthand section are extendable under the specific rejection, but an examiner reference to an inter partes provisions of Rule 136(b) for patent could still reject a claim so-amended, reexamination proceeding. The term applications and Rule 550(c) for ex parte provided that the rejection constituted a ‘‘owner’’ provides a shorthand reference reexamination proceedings. This new ground of rejection. to the owner of the patent undergoing provision appeared in former Rule (5) Paragraph (d) provides that inter partes reexamination under Rule 191(d). appellant’s failure to timely respond to 915. The term ‘‘requester’’ provides a Section 41.50 is added to generally an order of the Board of Patent Appeals generic term to describe each party incorporate the requirements of former and Interferences could result in the other than the owner who requested that Rule 196. In addition: dismissal of the appeal. the patent undergo inter partes (1) Paragraph (a)(1) explicitly (6) Paragraph (f) is added to provide reexamination under Rule 915. The term provides that the Board, in its principal notice that the periods set forth in this ‘‘appellant’’ provides a generic term for role under 35 U.S.C. 6(b) of reviewing section are extendable under the any party, whether the owner or a adverse decisions of examiners, may in provisions of Rule 136(b) for patent requester, filing a notice of appeal or its decision affirm or reverse the applications and Rule 550(c) for ex parte cross appeal under § 41.61. If more than decision of the examiner in whole or in reexamination proceedings. This one party appeals or cross appeals, each part on the grounds and on the claims provision appeared in former Rule appealing or cross appealing party is an specified by the examiner. The 191(d). appellant with respect to the claims to affirmance of the rejection of a claim on Section 41.52 is added to generally which his or her appeal or cross appeal any of the grounds specified constitutes incorporate the requirements of former is directed. The term ‘‘respondent’’ a general affirmance of the decision of Rule 197(b). In addition, paragraph provides a generic term for any the examiner on that claim, except as to (a)(1) incorporates the matter from requester responding under § 41.68 to any ground specifically reversed. The former Rule 196(b)(2) relating to the the appellant’s brief of the owner, or the Board may also remand an application request that the application or patent owner responding under § 41.68 to the to the examiner. under ex parte reexamination be appellant’s brief of any requester. No (2) Paragraph (a)(2) is added to require reheard. Arguments not raised in the requester may be a respondent to the appellant to respond to any briefs before the Board and evidence not appellant brief of any other requester. supplemental examiner’s answer issued previously relied upon in the brief and The terms ‘‘appellant’’ and in response to a remand from the Board any reply brief(s) are not permitted in ‘‘respondent’’ were defined in former to the examiner for further the request for rehearing except as Rule 962. The definition of the term consideration of a rejection to avoid sua permitted by paragraphs (a)(2) and (a)(3) ‘‘filing’’ provides a generic requirement sponte dismissal of the appeal as to the of this section. In addition, the rule that any document filed in the claims subject to the rejection for which would permit the Board to simply deny proceeding by any party must include a the Board has remanded the proceeding. a request for rehearing in appropriate certificate indicating service of the Appellant must exercise one of the cases rather than rendering a new document to all other parties to the following two options to avoid such sua opinion and decision on the request for proceeding as required by Rule 903. sponte dismissal of the appeal as to the rehearing. Paragraph (a)(2) provides that Section 41.61 is added to generally claims subject to the rejection for which upon a showing of good cause, incorporate the requirements of former the Board has remanded the proceeding: appellant may present a new argument Rule 959. (i) Request that prosecution be reopened based upon a recent relevant decision of Sections 41.63(a) and (b) are added to before the examiner by filing a reply either the Board or a Federal Court. replace the requirements of former Rule under Rule 111 with or without Paragraph (a)(3) provides that new 116 with a prohibition of amendments amendment or submission of affidavits arguments responding to a new ground submitted after the date the proceeding (Rules 130, 131 or 132) or other of rejection made pursuant to § 41.50(b) has been appealed pursuant to § 41.61, evidence, or (ii) request that the appeal are permitted. Paragraph (b) is added to except for amendments permitted by be maintained by filing a reply brief as provide notice that the period set forth § 41.77(b)(1) and amendments canceling provided in § 41.41. If such a reply brief in this section is extendable under the claims where such cancellation does not is accompanied by any amendment, provisions of Rule 136(b) for patent affect the scope of any other pending affidavit or other evidence, it shall be applications and Rule 550(c) for ex parte claim in the proceeding. Section treated as a request that prosecution be reexamination proceedings. This 41.63(c) replaces the requirements of reopened before the examiner under provision appeared in former Rule former Rule 975 with a prohibition on § 41.50(a)(2)(i). Any request that 191(d). the admission of affidavits and other prosecution be reopened under this Section 41.54 is added to generally evidence submitted after the case has paragraph would be treated as a request incorporate the requirements of former been appealed pursuant to § 41.61 to withdraw the appeal. Rule 197(a). except as permitted by § 41.77(b)(1). (3) Paragraph (b)(2) eliminates the Subpart C is added to provide rules This replaces the current practice of provision relating to requests that the for the inter partes appeal under 35 permitting such evidence based on a application or patent under ex parte U.S.C. 315 of a rejection in an inter showing of good and sufficient reasons reexamination be reheard, since that partes reexamination proceeding to the why such evidence was not earlier provision is included in § 41.52(a). Board. This subpart does not apply to presented. The Office believes that (4) Paragraph (c) provides that the any other Board proceeding and is prosecution of an application should opinion of the Board may include an strictly limited to appeals in inter partes occur before the examiner prior to an explicit statement how a claim on reexamination proceedings filed under appeal being filed, not after the case has appeal could be amended to overcome 35 U.S.C. 311. been appealed pursuant to § 41.61.
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Section 41.64 is added to generally presented for review. An example of a (11) Paragraph (c)(1)(ix) is added to incorporate the requirements of former concise statement is claims 1 to 10 stand require appellant to include an evidence Rule 961, but would make clear that rejected under 35 U.S.C. 102(b) as being appendix of any evidence relied upon jurisdiction over a proceeding may be anticipated by U.S. Patent No. X. by appellant in the appeal with a relinquished and the proceeding (7) The grouping of claims statement setting forth where that returned to the examining operation to requirement set forth in former Rule evidence was entered in the record by permit processing to be completed 965(c)(7) is removed. The general the examiner so that the Board would be before the Board takes up the appeal for purpose served by former Rule 965(c)(7) able to reference such evidence easily decision. is addressed in § 41.67(c)(1)(viii). The during their consideration of the appeal. Section 41.66 is added to generally existing grouping of claims requirement (12) Paragraph (c)(1)(x) is added to incorporate the requirements of former has led to many problems as set forth require appellant to include a related Rule 963. above in the discussion of § 41.37. proceedings appendix containing copies Section 41.67 is added to generally (8) In paragraph (c)(1)(vii), any of decisions rendered by a court or the incorporate the requirements of former arguments or authorities not included in Board in any proceeding identified Rule 965. In addition: a brief permitted in this section or filed pursuant to § 41.67(c)(1)(ii) so that the (1) In paragraph (a), one copy of the pursuant to §§ 41.68 and 41.71 will be Board can take into consideration such brief is required rather than three copies refused consideration by the Board, decisions. consistent with the Office’s move to an unless good cause is shown, and a (13) Paragraph (c)(2) is added to electronic file wrapper. exclude any new or non-admitted (2) In paragraph (c)(1)(i), a statement separate heading is required for each ground of rejection in place of the amendment, affidavit or other evidence in the brief is required identifying by from being included in an appellant’s name the real party in interest even if previous grouping of claims section of the brief. For each ground of rejection brief. the party named in the caption of the Section 41.68 is added to generally brief is the real party in interest. This applying to two or more claims, the claims may be argued separately or as a incorporate requirements found in provides appellant the necessary former Rule 967 and changes similar to mechanism of complying with § 41.8(a) group. When an appellant argues as a group multiple claims subject to the those in § 41.67. In addition, paragraph in an appeal to the Board; (b)(2) excludes any new or non-admitted (3) In paragraph (c)(1)(ii), clear same ground of rejection, the Board may select a single claim from that group of amendment, affidavit or other evidence identification is required of all other from being included in a respondent’s prior and pending appeals, interferences claims and treat its disposition of a ground of rejection of that claim as brief. or judicial proceedings known to Section 41.69 is added to generally applying to the disposition of that appellant, the appellant’s legal incorporate requirements found in ground of rejection of all claims in the representative, or assignee which may former Rule 969. be related to, directly affect or be group of claims. Notwithstanding any Section 41.71 is added to generally directly affected by or have a bearing on other provision of this paragraph, an incorporate requirements found in the Board’s decision in the pending appellant’s failure to argue separately former Rule 971. appeal, as well as to provide a claims that appellant has grouped Section 41.73 is added to generally mechanism of complying with § 41.8(b) together would constitute a waiver of incorporate the requirements of former in an appeal to the Board. any argument that the Board must Rule 973. In addition: (4) In paragraph (c)(1)(iii), both a consider the patentability of any (1) Paragraph (b) requires the separate statement of the status of all the claims grouped claim separately. See In re paper requesting the oral hearing to be in the proceeding (e.g., rejected, allowed McDaniel, 293 F.3d 1379, 1384, 63 captioned ‘‘REQUEST FOR ORAL or confirmed, withdrawn, objected to, USPQ2d 1462, 1465–66 (Fed. Cir. 2002) HEARING’’ and that such a request can canceled) and an identification of those (interpreting analogous former Rule be filed within two months from the claims that are being appealed is 192(c)(7) to require separate treatment of date of the examiner’s answer. required. separately rejected claims). Any claim (2) Paragraph (d) is added to provide (5) In paragraph (c)(1)(v), a concise argued separately should be placed the procedure for handling the request explanation is required of the subject under a subheading identifying the for oral hearing in which a party has matter defined in each of the claim by number and that claims argued complied with all the requirements of independent claims involved in the as a group should be placed under a paragraph (b) of this section. Since appeal and which concise explanation subheading identifying the claims by notice to the primary examiner is a shall refer to the specification by page number. matter internal to the Office, the and line number, and to the drawings, (9) Paragraph (c)(1)(vii) states that requirement for notice to the primary if any, by reference characters. For each ‘‘Merely pointing out differences in examiner has been removed from the independent claim involved in the what the claims cover is not an rule. It is anticipated that the primary appeal and each dependent claim argument as to why the claims are examiner will be sent notice of the argued separately under the provisions separately patentable.’’ This statement hearing time and date by e-mail. of paragraph (c)(1)(vii) of this section, in slightly different form appeared in (3) Paragraph (e)(1) is added to every means plus function and step plus former Rule 965(c)(7). specifically provide that at the oral function as permitted by 35 U.S.C. 112, (10) Paragraph (c)(1)(vii) eliminates hearing (i) parties may only rely on sixth paragraph, must be identified and subparagraphs (i) through (v) of former evidence that has been previously the structure, material, or acts described Rule 965(c)(8) which related to the considered by the primary examiner and in the specification as corresponding to manner in which arguments were to be present argument that has been relied each claimed function be set forth with made. Although providing useful advice upon in the briefs except as permitted reference to the specification by page as to what an effective argument ought by paragraph (e)(2) of this section; (ii) and line number, and to the drawing, if to include, these provisions have often the primary examiner may only rely on any, by reference characters. been ignored by appellants and, for the argument and evidence relied upon in (6) In paragraph (c)(1)(vi), a concise most part, have not been enforced as the answer except as permitted by statement is required listing each issue provided in former Rule 965(d). paragraph (e)(2) of this section; and (iii)
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that the Board will determine the order is implicitly defined in Rule 601(f) (for combination of papers minimizes the of the arguments presented at the oral claims) and in Rule 601(l) (for chance that an argument will be hearing. applications), but is not explicitly overlooked and reduces abuses that (4) Paragraph (e)(2) is added to defined in the current rules. The rule arise from incorporation and specifically provide that upon a expressly defines ‘‘involved’’ as combination. showing of good cause, appellant, designating any patent application, Section 41.106(c) requires the filing of respondent and/or the primary patent, or claim that is the subject of the a working copy for the Board official examiner may rely on a new argument contested case. administering the proceeding. based upon a recent relevant decision of Section 41.101 follows the practice in Section 41.106(d) provides additional either the Board or a Federal Court. Rule 611(a) and (b) for notifying parties guidance for special modes of filing. (5) Paragraph (f) is added to of a contested case. As a courtesy, the Section 41.106(d)(1) encourages the use incorporate the substance found in Board will make reasonable efforts to of the EXPRESS MAIL service of the former Rule 194. Exemplary situations provide notice to all parties. Failure to United States Postal Service. Section where the Board might decide no maintain a current correspondence 41.106(d)(2) permits other modes of hearing is necessary include those address may result in adverse filing. where the Board has become convinced, consequences. prior to hearing, that the proceeding Section 41.102 requires completion of Section 41.106(e)(1) requires papers to must be remanded for further examination for most applications (and be served when they are filed if they consideration prior to evaluating the of reexamination for most patents) have not already been served. Section merits of the appeal. before the Board will institute a 41.106(e)(3) provides for expedited Section 41.77 is added to generally contested case. service. incorporate the requirements of former Section 41.103 follows the file Section 41.106(f) provides rules for Rule 977. jurisdiction practice in Rules 614 and certificates of service. Section Section 41.79 is added to generally 615 except to generalize the temporary 41.106(f)(1) requires the certificate to be incorporate the requirements of former transfer of jurisdiction to include parts incorporated into each paper other than Rule 979 concerning rehearing before of the Office other than the examining exhibits. When the exhibits are filed at the Board. Paragraph (b) generally corps, including, for example, the Office the same time, the certificate may be incorporates the requirements of former of Public Records. Such transfers of incorporated into the exhibit list. See Rule 979(d). Arguments not raised in jurisdiction will generally be for short § 41.154(d). the briefs before the Board and evidence periods and for limited purposes. Section 41.108 requires each party to not previously relied upon in the briefs Section 41.104(a) follows the practice identify its counsel, if any. The rule also are not permitted in the request for of Rule 610(e), which permits an follows Rule 613(a), which permitted rehearing except as permitted by administrative patent judge wide the Board to require the appointment of paragraphs (b)(2) and (b)(3) of this latitude in administering interferences. a lead counsel. section. Paragraph (b)(2) provides that The decision to waive a procedural Section 41.109 follows Rule 612 in upon a showing of good cause, requirement is committed to the permitting parties to obtain copies of appellant and/or respondent may discretion of the administrative patent certain Office files directly related to the present a new argument based upon a judge. contested case. Section 41.109(c) Section 41.104(c) clarifies that any recent relevant decision of either the requires a party that has not received default times set by rule may be Board or a Federal Court. Paragraph copies of a requested file to notify the changed by order. ‘‘Times’’ in paragraph (b)(3) provides that new arguments Board of the problem promptly. responding to a new ground of rejection (c) includes both dates and durations. Section 41.106 provides guidance for Section 41.110(a) requires a single made pursuant to § 41.77(b) are clean set of the claims, analogous to the permitted. Paragraph (c) generally the filing and service of papers. Under § 41.106(a), papers to be filed are requirement for amendments ‘‘in clean incorporates the requirements of former form’’ in Rule 121. Rule 979(b). Paragraph (d) generally required to meet standards very similar incorporates the requirements of former to those required in patent prosecution, Section 41.120 provides for notice of Rule 979(c). Paragraph (e) generally Rule 52(a), and in filings in the Court of requested relief and the basis for that incorporates the requirements of former Appeals for the Federal Circuit, Fed. R. relief in contested cases. Rule 979(g). App. P. 32. Section 41.106(a)(1) would Section 41.121(a)(1) redefines motions Section 41.81 is added to generally permit a party to file papers in either A4 practice under Rule 633(a), (b), (c)(2), incorporate the requirements of former format or 81⁄2-inch × 11-inch format, but (c)(3), (c)(4), (f) and (g) to focus more Rule 979(e). not to alternate between formats. At specifically on the central issue in the Subpart D provides rules for contested present, the Board prefers papers to be contested case. Section 41.121(a)(1)(iii) cases before the Board. Contested cases filed in 81⁄2-inch × 11-inch format permits a motion for judgment in the are predominantly patent interferences because the present filing system is best contest, which can include an attack on under 35 U.S.C. 135(a), but also include adapted to this paper format. standing as well as a motion for relief United States Government ownership Section 41.106(b) provides guidance on the central issue of the contest. contests under 42 U.S.C. 2182(3) and specific to papers other than exhibits. Section 41.121(a)(2) and (a)(3) modifies 2457(d). Section 41.106(b)(1) codifies current the responsive motion and Section 41.100 defines two terms. The practices for the cover sheet of a paper. miscellaneous motion practice under term ‘‘business day’’ is defined in a Section 41.106(b)(2) requires holes at Rules 633(i) and (j), 634, and 635 to manner consistent with 35 U.S.C. 21(b) the top of the paper consistent with ensure that the proceeding remains to exclude Saturday, Sunday, and Local Civil Rule 5.1(f) (1999) of the focused. Section 41.121(a)(3) provides Federal holidays, when the closure of United States District Court for the for miscellaneous motions, which the Board may affect the Board’s, or a District of Columbia to facilitate entry of would offer a mechanism for requesting party’s, ability to perform an action. the paper in the administrative record. relief on procedural issues and other The term ‘‘involved’’ appears in 35 The bar in § 41.106(b)(3) against issues tangential to patentability and U.S.C. 135(a) with respect to claims and incorporation by reference and priority.
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Section 41.121(b) places the burden of list of sanctions provided in Rule 616, testimony. The time period for cross- proof on the moving party, following but adds a terminal disclaimer examination set in § 41.157(c)(2) follows Rule 637(a) (2003). requirement as a sanction. the current practice and sets a norm for Section 41.121(c)(1) follows Rule Section 41.150(a) restates the present the conference held under 637(a) regarding the general contents of policy of limited discovery, consistent § 41.157(c)(1). Section 41.157(c)(3) motions, but would also codify the with the goal of providing contested clarifies the practice of providing current practice of requiring a separate proceedings that are fast, inexpensive, documents in advance by limiting the paper for each motion. The numbered and fair. Section 41.150(b) provides for practice to direct testimony. Since direct paragraphs stating material facts in automatic discovery of materials cited testimony is generally in the form of a § 41.121(c)(1)(ii) should be short, ideally in the specification of an involved or declaration, the circumstance in which just a sentence or two, to permit the benefit disclosure. Section 41.150(c) § 41.157(c)(3) would apply should rarely opposing party to admit or deny each restates existing practice under Rule 687 occur apart from compelled testimony. fact readily. Under § 41.121(c)(1)(iii), regarding additional testimony. Section 41.157(d) codifies the existing sloppy motion drafting is held against Section 41.151 continues the practice requirement for a conference before a the moving party. Section 41.121(c)(2) under Rule 671(i) of making failure to deposition with an interpreter. requires the movant to make showings comply with the rules a basis for Section 41.157(e) adopts ‘‘officer’’, the ordinarily required for the requested challenging admissibility. term used in 35 U.S.C. 23, to refer to the relief in other parts of the Office. Section 41.152 continues the current person qualified to administer Section 41.121(d) allows the Board to practice of using the Federal Rules of testimony. The certification of raise questions of patentability. Evidence in contested cases. Section § 41.157(e)(6)(vi) substantially adopts Section 41.122 codifies the present 41.152(d) permits reliance on official the standard of Rule 674 for practice regarding new arguments in notice and hearsay to determine the disqualifying an officer from replies. scope and effect of foreign law. administering a deposition. Section Section 41.123(a) sets default times Section 41.153 restates the practice 41.157(e)(7) requires the proponent of for filing motions. Section 41.123(b) under Rule 671(d) of admitting Office the testimony to file the transcript of the provides requirements for records that are available to all parties testimony. miscellaneous motions. without certification. Under § 41.154(a), Section 41.157(f) codifies the existing A party may request an oral argument each Office record cited as evidence practice of requiring the proponent of under § 41.124(a), but requests would would have to be submitted as an testimony to pay the reasonable costs not be automatically granted. Section exhibit. associated with making the witness 41.124(b), requires the parties to file Section 41.154(a) restates Rule 671(a), available for cross examination, three working copies of the papers to be which sets the form of evidence, and including the costs of the reporter and considered for the panel if the hearing codifies the existing practice that all transcript. is set for a panel. Section 41.124(c) evidence must be submitted as an Section 41.158 codifies the current provides a default time of 20 minutes exhibit. Section 41.154(b) restates Rule practice regarding expert testimony and per party for oral arguments at the Board 647 regarding translation of foreign scientific tests and data. because they are not evidentiary language evidence. Section 41.154(c) Subpart E provides rules specific to hearings. Section 41.124(d) permits the sets forth additional formal patent interferences. Section 41.200(a) use of demonstrative exhibits. Section requirements for exhibits consistent would specifically identify patent 41.124(e) permits the transcription of with current practice. An exhibit list is interferences as contested cases subject the argument. required under § 41.154(d). to the rules in subpart D. Section 41.125(a) maintains the Section 41.155 sets forth rules for Section 41.200(b) continues the discretion under current practice to objecting to evidence and responding to practice under Rule 633(a) of looking at address issues in an order that is both objections. Under § 41.155(b)(1), the the applicant’s specification to fair and efficient. Section 41.125(b) default time for serving an objection to determine the meaning of a copied clarifies the current practice that a evidence other than testimony is five claim, not the specification from which decision short of judgment is not final. business days. Section 41.155(b)(2) the claim was copied. Section 41.125(c) recodifies the time for permits a party that submitted evidence Section 41.200(c) sets forth the policy requesting rehearing from Rule 640(c) ten business days after service of the now found in Rule 610(c) setting two and the procedural requirements of the objection to cure any defect in the years as the maximum normal pendency last two sentences of Rule 655(a). evidence. (Standing Order ¶ 14.2 for patent interferences. Section 41.126 recodifies the current provides two weeks.) The Board would Section 41.201 sets forth definitions arbitration practice. not ordinarily address an objection specific to patent interferences. The Section 41.127(a)(1) recodifies the unless the objecting party filed a motion phrase ‘‘accorded benefit’’ is defined as existing estoppel provision for to exclude under § 41.155(c). Section the Board’s designation of an interferences. Section 41.127(a)(2) 41.155(d) provides for a motion in application as providing a proper restates the final disposal provision of limine for a ruling on admissibility. constructive reduction to practice for a Rule 663. Section 41.127(b) restates the Section 41.156(a) requires a party party. conditions in Rule 662 under which the seeking a subpoena to first obtain A definition is set forth for the phrase Board infers a concession of the contest. authorization from the Board. Section ‘‘constructive reduction to practice’’ Section 41.127(c) restates the 41.156(b) imposes additional because this phrase is used in the rules recommendation provision of Rule 659. requirements on a party seeking instead of ‘‘earliest effective filing date’’ Section 41.127(d) provides a time for testimony or production outside the to explain more precisely how benefit is requesting a rehearing. United States because the use of foreign accorded for the purpose of determining Section 41.128(a) restates Rule 616 on testimony generally increases the cost priority. sanctions, but adds the examples of and complexity of the proceeding for The term ‘‘count’’ is redefined to misleading arguments and dilatory both the parties and the Board. emphasize the relationship of the count tactics to the list of reasons for Section 41.157 restates existing to admissible proofs of priority under sanctions. Section 41.128(b) restates the practice regarding the taking of § 102(g).
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The definition of ‘‘involved claim’’ is motions. Section 41.203(d) permits a Section 41.207(b) clarifies claim based on a similar definition in Rule party to suggest that an administrative correspondence practice and explicitly 601(f) and is consistent with the patent judge exercise discretion to states the effect of claim definition of ‘‘involved’’ for contested declare a new interference or to correspondence. Section 41.207(b)(1) cases in § 41.100 because only claims redeclare the existing interference to reflects current practice under which that correspond to the count are at risk accommodate such files. patentability must be determined for in an interference, except to the extent Section 41.204 would define notices claims, not counts. Under § 41.207(b)(2), a question is raised as to whether a of requested relief in interferences. a claim would correspond to the count claim that does not correspond should. Section 41.204(a) simplifies the formal if the subject matter of the claim would The definition of ‘‘senior party’’ requirements for the principal notice on have been anticipated by or obvious would depart from the current priority, the preliminary statement (alone or in combination with prior art) definition in Rule 601(m) by focusing on (which is renamed a ‘‘priority in view of the subject matter of the the earliest constructive reduction to statement’’). Section 41.204(b) codifies count. practice to determine which party, if the existing practice of requiring a list The presumption in § 41.207(c) any, is senior. of motions, but under the rule a party restates the presumption in Rule 637(a) The phrase ‘‘threshold issue’’ is would ordinarily be limited to filing that prior art cited against an opponent defined to include three specific issues substantive motions consistent with its is presumed to apply against the that directly affect whether a party may notice of requested relief. No default movant’s claims. participate in an interference. The first times is set for statements in § 41.204(c). Section 41.208(a) focuses substantive identified threshold issue is no Section 41.205 restates practice under motions on the core questions of interference-in-fact. The other two Rule 666 regarding the filing of priority. specifically identified issues, the bar settlement agreements and would Section 41.208(b) places the burden of under 35 U.S.C. 135(b) and lack of implement the requirements of 35 proof on the movant and provides written description under 35 U.S.C. U.S.C. 135(c). Section 205(a) guidance on how to satisfy the burden 112(1), are directed to the prevention of incorporates Rule 661. In addition, of going forward. spuriously provoked interferences and § 41.205(a) provides that after a final Section 41.208(c)(1) requires a movant would consequently be limited to decision is entered by the Board, an seeking to add or amend a claim to motions from a party with a patent or interference is considered terminated show that the added or amended claim published application against a party when no appeal (35 U.S.C. 141) or other is patentable. Section 41.208(c)(2) with an involved application. review (35 U.S.C. 146) has been or can similarly requires a movant seeking to Section 41.202(a) restates the be taken or had. If an appeal to the U.S. add or amend a count to show that the requirements of Rules 604, 607, and 608 Court of Appeals for the Federal Circuit count does not include unpatentable for applicants provoking an (under 35 U.S.C. 141) or a civil action subject matter. interference. Section 41.202(a)(5) (under 35 U.S.C. 146) has been filed the continues the practice under Rule 633(a) interference is considered terminated Discussion of Comments of looking at the applicant’s when the appeal or civil action is Generally specification to determine the meaning terminated. A civil action is terminated of a copied claim, not the specification when the time to appeal the judgment Unless otherwise indicated, rule from which the claim was copied. expires. An appeal to the U.S. Court of references are to rules within chapter I Section 41.202(c) restates the practice Appeals for the Federal Circuit, whether of title 37, Code of Federal Regulations. under Rule 605 of requiring an from a decision of the Board or a Comments directed to formal errors in applicant to add a claim to provoke an judgment in a civil action, is terminated the proposed rule making have been interference, but adds requirements for when the mandate is issued by the gratefully considered, but will not be applicants copying claims from patents. Court. Rule 41(d)(2), Fed. R. App. separately discussed. Section 41.202(d) sets forth the basis Procedure, controls when the mandate Comment 1: One comment suggests for a summary proceeding when an of the Court of Appeals will issue in the that the Board rules are confusing applicant does not appear to be able to event that a party filed a petition for because some of them apply to activities show it would prevail on priority. writ of certiorari to the United States that take place before an examiner Section 41.202(d)(1) restates Rule 608, Supreme Court. Unless a party rather than during the Board proceeding but eliminates the distinction between petitioning for a writ of certiorari seeks itself. The comment suggests that such Rule 608(a) and Rule 608(b). Section and obtains a stay of the appellate rules be restored to Part 1 rather than 41.202(d)(2) restates Rule 617 by court’s mandate, proceedings will be moved to Part 41 as proposed. providing a basis for a summary considered terminated with the issuance Answer: The problem identified is proceeding on priority when the of the mandate, as noted in § 41.205(a). common to any set of rules covering applicant fails to make a sufficient Section 41.206 revises practice transitions or interfaces between showing of priority. Under § 41.202(e), regarding commonly owned patents and separate processes. For instance, the the showing must by itself, if applications in an interference to Federal Rules of Appellate Procedure unrebutted, warrant a determination of address cases involving a real party-in- (FRAP) provide directions to the clerk of priority favorable to the applicant. interest with the ability to control the the district court on what to do (FRAP Section 41.203(a) states the standard conduct of more than one party. 3) before the appeal is docketed (FRAP for declaring a patent interference. The Section 41.207(a)(1) recodifies the 12(a)). A choice must be made between Director uses a two-way unpatentability presumption regarding order of keeping such rules with the patent test to determine whether claimed invention from Rule 657(a). Section prosecution rules, moving them to the inventions interfere. Under § 41.203(b) 41.207(a)(2) recodifies the evidentiary Board rules, or even creating an an administrative patent judge declares standards for proving priority stated in additional part. the interference. Section 41.203(c) Rule 657(b) and (c), but restates the The best choice is to keep such rules authorizes an administrative patent standard of Rule 657(c) in terms of the with the Board rules. At least one such judge to redeclare the interference sua date of the earliest constructive rule is triggered in relation to every sponte or in response to a decision on reduction to practice. Board proceeding. For instance, § 41.37
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(appeal briefs) will be implicated in the logical delegate to administer disclosure Answer: The comments’ reasoning is majority of ex parte appeals to the of Board actions. consistent with the filing of a Board. By contrast, a Board proceeding Section 1.11(e) has been amended to miscellaneous motion (§ 41.121(a)(3)), occurs in only about 1% of all simplify the language of the rule and to but not with the filing of a substantive applications. Consequently, the provide a cross reference to § 41.6. motion (§ 41.121(a)(1)). Consequently, connection of the rules in question to Comment 5: One comment opposes Rules 322 to 324 have been revised to Board practice is much stronger than the the additional discretion in § 1.14(e)(2) refer to § 41.121(a)(2) and (3). connection to prosecution. As a to publish petition decisions. Comment 10: One comment suggests convenience to applicants and other Answer: The only changes to § 1.14 that § 1.565(e) be amended to reflect the users of the rules, § 1.191 and § 1.959 intended in this rule making were balance between the need for special direct attention to appropriate subparts ministerial deletions of references to dispatch in reexaminations and the of Part 41. decisions of the Board. Another rule need for the Office to ensure orderly Comment 2: One comment notes that making, 68 FR 38624, has changed proceedings, citing Ethicon v. Quigg, § 1.1(a)(1)(iii), which provides an § 1.14 in a way that appears to address 849 F.2d 1422, 7 USPQ2d 1152 (Fed. address for patent interference the concerns of the comment. Cir. 1988). correspondence was removed but was Comment 6: One comment suggests Answer: The proposed revision of not replicated in Part 41. that extension of time practice in the § 1.565(e) only changed the cross- Answer: The interference address was proposed rules is confusing because it is reference. The comment suggests a located in proposed § 41.106(d). In view not always clear whether § 1.136 or change that is outside the scope of this of the confusion that the proposed § 41.4 would apply. rule making. Nevertheless, the Office is approach caused for the person making Answer: As proposed, § 41.4(c) keenly aware of the need for balance on the comment, both § 1.1(a)(1)(ii) and explained that § 41.4 applied to Board this point. § 1.1(a)(1)(iii) (and the address portion proceedings, but not during prosecution of § 41.106(d)) have been moved to a Part 41, Subpart A—General Provisions or during the time for judicial review. new § 41.10. Section 1.1(a)(1)(ii) has Comment 11: One comment suggests The rule has been amended to clarify been rewritten to direct readers to that the lack of paragraph designations that § 41.4 applies when a matter is § 41.10. in § 41.2 for each definition is actually pending before the Board. For Comment 3: One comment notes that confusing, particularly since instance, an extension of time to file an § 1.6(d)(9) and § 1.8(a)(2)(i)(B), which subparagraphs are numbered. ban facsimiles and certificates of appeal brief, which is due before Answer: The rule conforms to the mailing in interferences, are removed. jurisdiction transfers to the Board, guidance the Office of the Federal The comment suggests that the removal would be subject to § 1.136, while a Register provides for drafting means these practices are now request for additional time to file a definitions. Federal Register Document permitted. request for reconsideration of a Board Drafting Handbook section 8.15. Given Answer: Section 41.106 provides decision would be subject to § 41.4. that the defined terms are listed directions on filing papers with the Comment 7: Two comments suggest alphabetically and italicized, in practice Board in contested cases, including that § 1.292(a) be modified to permit the format should not be confusing. interferences. Sections 1.6(d)(9) and delegation of the conduct of public use Comment 12: One comment suggests 1.8(a)(2)(i)(B) have been revised to proceedings to the Board of Patent that the definition of ‘‘Board of Patent direct readers to § 41.106. Appeals and Interferences. Appeals and Interferences’’ in § 41.2, Comment 4: One comment opposes Answer: This suggestion falls outside which includes both Board members moving § 1.14(e) to § 41.6 because the the scope of the present rule making, in and Board employees for non-final comment urges that this important which § 1.292(a) was included simply to actions, is inconsistent with an Office function should remain under the change a cross reference. The comments rule making published 4 December 2003 control of the Director. have been forwarded to the Deputy at 68 FR 67818. The comment prefers Answer: Several observations are in Commissioner for Patent Examination the approach taken in this final rule. order. First, the rule is limited to Board Policy for further consideration. Note, The comment is more relevant to the actions, not all patent related matters. however, that § 1.292(a) would permit other rule making and has been Second, the rule simply implements such a delegation without amendment. forwarded to the Deputy Commissioner access that is already available under a Comment 8: One comment suggests for Patent Examination Policy. Note that variety of statutes. Third, the Board’s additional modifications to § 1.292(a) as Board employees other than Board administration of this provision occurs well as to subpart D of part 41 to members are only defined as the Board under a delegation from the Director authorize action by a single Board for the purposes of non-final actions. and remains subject to the Director’s member and to provide relief in Comment 13: Two comments urge ultimate supervision. Indeed, proceedings under 42 U.S.C. 2182(4) that § 41.3 creates confusion for § 41.6(a)(2) expressly reserves to the and 2457(d). petitions relating to rules in part 41 but Director the determination of whether Answer: Subpart D provides sufficient arising while the Board does not have special circumstances justify releasing flexibility to permit such actions jurisdiction, for example, supervisory information about an application without amendment. review of an examiner’s answer for otherwise entitled to confidentiality Comment 9: Three comments suggest failure to comply with a rule. under 35 U.S.C. 122(a). With the advent that the cross-reference to § 41.121(a)(2) Answer: Section 41.3 is amended to of pre-grant publication under 35 U.S.C. in §§ 1.322–1.324 is too narrow because include a scope provision that limits its 122(b), the vast majority of final Board it would only permit corrections in a scope to actions by the Board or to decisions are soon expected to be responsive motion. The suggested cure proceedings pending before the Board. routinely available at the time they are is to generalize the reference to Comment 14: One comment suggests issued or shortly afterward. It is § 41.121(a) because the need to correct that § 41.3(a) be amended to bar the impracticable for the Director to can arise at various times and may not Chief Administrative Patent Judge from administer disclosure of all of these be in response to anything filed in a delegating authority to enter a decision decisions personally. The Board is the contested case. on a petition to a person who
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participated in the matter being Comment 17: One comment states disqualification proceeding would petitioned. that proposed § 41.4(b) is particularly provide, at least two checks exist. A Answer: The suggestion involves confusing in that it indicates that late disqualification would not become final matters of Board management, which filings ‘‘will not be considered absent a until the Chief Administrative Patent are better treated in management showing of excusable neglect or a Board Judge certified the result. Counsel could documents like standard operating determination that consideration on the seek to moot any disqualification by procedures. merits would be in the interest of requesting to withdraw before the result Comment 15: One comment notes that justice.’’ Under current practice, when a is certified. If the Chief Administrative proposed § 41.4(a) sets a ‘‘good cause’’ notice of appeal or appeal brief is filed Patent Judge certifies the standard for obtaining an extension of late, an applicant has the option of disqualification, the case becomes ripe time, whereas § 1.136(b), relating to petitioning to revive that application for judicial review under 35 U.S.C. 32. non-fee extensions of time, sets a under § 1.137 by showing that the delay Comment 19: One comment opposes ‘‘sufficient cause’’ standard. The in filing an appropriate paper or fee was the requirement in § 41.5(c) that comment suggests either the unavoidable or unintentional. The requires Board approval to withdraw as commentary describe the differences, if comment states that it is not clear from counsel in a Board proceeding. any, between these two standards or the proposed § 41.4(b) whether the Answer: The rule should not create adopt the ‘‘sufficient cause’’ standard in provisions of § 1.137 will be available any practical difference for counsel proposed § 41.4(a). for late filings of papers and fees after since approval is required for any Answer: The ‘‘good cause’’ standard a notice of appeal is filed, or in what withdrawal. The approval should come for obtaining an extension of time under circumstances they will be available. from the part of the agency with § 41.4(a) will be maintained to Answer: Section 41.4(b) has been jurisdiction over the application or distinguish it from the ‘‘sufficient revised to reflect that a late filing that patent at the time of the withdrawal. cause’’ standard of § 1.136(b). An results in either an application Comment 20: Two comments oppose extension of time under § 41.4(a) for becoming abandoned or a reexamination § 41.7(a), which permits the Board to ‘‘good cause’’ is decided by the Board proceeding becoming terminated under expunge unauthorized papers, because while an extension of time under §§ 1.550(d) or 1.957(b) or (c) will be of the scope of the rule. Answer: The rule has been clarified to § 1.136(b) for ‘‘sufficient cause’’ is excused if the application or reexamination proceeding is revived as state that it only applies to papers filed decided outside of the Board. The ‘‘good set forth in § 1.137. A late filing that as part of a proceeding before the Board cause’’ standard for obtaining an does not result in either an application (§ 41.1(a)) or while the Board has extension of time has previously been becoming abandoned or a reexamination jurisdiction over the file and will not be used by the Board in former § 1.645 proceeding becoming terminated under used to prune applications arbitrarily. (2003) and will be maintained even §§ 1.550(d) or 1.957(b) or (c) will be Comment 21: One comment suggests though there is little, if any, difference excused upon a showing of excusable that expungement of papers under between the standards. neglect or a Board determination that § 41.7(a) be limited to exceptional To establish good cause for a filing consideration on the merits would be in circumstances. delay, a party must show that the delay the interest of justice. Answer: Violation of a rule or Board was excusable under the circumstances Comment 18: One comment objects to order, the triggers for expungement, and that the appellant exercised due the provision in § 41.5(b) of a should be an exceptional circumstance diligence in attempting to meet the disqualification proceeding before the in patent practice. filing deadline. The factors bearing on Board as ill-defined and beyond the Comment 22: One comment expresses whether there is good cause for an Board’s competence. concern that § 41.7(a) would prevent the untimely filing include the length of the Answer: The disqualification entry of evidence and would result in an delay, knowledge of the time limit, proceeding already exists in contested incomplete record. This, the comment circumstances beyond the party’s cases (see now-removed § 1.613 (2003)) suggests, would result in more judicial control that affected its ability to where it appears to have worked well. review being sought in district court comply with the deadline, the party’s The objection may be based on a rather than through direct appeal to the negligence, if any, and any unavoidable misapprehension that this provision United States Court of Appeals for the harm that might have prevented timely governs suspension or exclusion from Federal Circuit (Federal Circuit). The filing. Zamot v. MSPB, 332 F.3d 1374, practice before the Office generally comment suggests that such filings are 1377 (Fed. Cir. 2003). rather than the special case of a useful as a way to place papers in the Comment 16: One comment notes that suspension or exclusion from a specific record, knowing that they will not be extensions of time for certain deadlines case before the Board. Disqualifications considered by the Office, simply to get in interferences can generally be at the Board typically arise out of them in front of a court. obtained by stipulation according to the conflicts of interest and, consequently, Answer: Such filings are not proper. current Standing Order. The comment are more of a feature of contested cases. Two remedies exist for expungement of suggests changing proposed § 41.4(a) by The advent of appeals in inter partes a paper. In some cases, it may be adding at the end ‘‘or Order of the reexaminations makes this provision appropriate to seek entry of new Board’’. relevant to appeals, too. Moreover, a evidence in a district court under 35 Answer: The practice of permitting disqualification might be appropriate in U.S.C. 145 or 146. In most cases, stipulated changes is unaffected by this an ex parte appeal, for instance, when however, the remedy would be to provision (which existed under a former Office employee appears as challenge the expungement directly by § 1.645(a) (2003)). An authorized, counsel in a case in which he or she petition showing either that the paper stipulated change in a deadline is not an acted while at the Office. Note that was properly filed or that it should be extension of the deadline. The suggested disqualification could be in addition to retained in the interest of justice. addition could create the other appropriate sanctions under 37 Comment 23: One comment misapprehension that the standard itself CFR part 10. recommends that a definition of ‘‘Board can be changed by order. The suggestion Although the comment suggests proceeding’’ be included in proposed will not be adopted. unease with the level of due process the § 41.2, to avoid possible inconsistencies
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between the requirements of proposed adequate notice of judicial review in The bar on ex parte communications § 41.7(b) and those of proposed contested cases can result in in § 41.11 is stricter than the bar on ex § 41.37(c)(1)(ix). applications that should be suspended parte interviews in § 1.955. Section Answer: Section 41.7(b) has been pending the outcome of the judicial 1.955 allows ex parte communications changed to read ‘‘A party may not file review being held abandoned or being with an official acting on the merits as a paper previously filed in the same allowed and other administrative long as the merits are not discussed Board proceeding, not even as an complications. during the ex parte communication. exhibit or appendix, without Board Comment 26: One comment requests Section 41.11 bars all ex parte authorization or as provided by rule’’ so clarification of what constitutes a communications with all administrative as to avoid an inconsistency with the related case under § 41.8. patent judges and with any Board requirement of § 41.37(c)(1)(ix) to Answer: The requirement is employee acting on the merits. Non- provide an appendix containing copies substantially the same in scope as the merits ex parte communications may of evidence previously submitted and requirement in Fed. Cir. R. 47.5. Now- take place with other Board employees entered by the examiner. removed § 1.656(b)(2) (2003) also who are not acting on the merits of the Comment 24: One comment suggests imposed a similar requirement. The case. that § 41.7(b) creates a burden by Board needs to know of related cases for Section 41.11 is intended to be requiring a party to request entry of a several reasons. First, awareness of restrictive because experience has duplicate paper that the Board may related cases facilitates scheduling and shown that ex parte communications are wish to have. panel assignment, which can increase easily abused and easily shift from Answer: Parties should assume that efficiencies for both the Board and the permissible topics to impermissible the Board does not want the duplicate party. Second, a decision in a related topics. The rule prohibits any ex parte paper in the absence of a specific judicial or administrative case may contact about a pending case with an request or as provided by rule as affect the outcome in the case before the administrative patent judge because the discussed above. Board. administrative patent judge might be Comment 25: Two comments suggest For instance, a definition of a claim assigned to a panel in the proceeding. that § 41.8, which requires prompt term in a related case may limit or Comment 28: Three comments urge reporting of changes in real party-in- expand the scope for the same term in that ex parte communications with interest or in related cases, is onerous as a case before the Board. See Ballard Board staff can be helpful to applied to appellants. In particular, they Med. Prods. v. Allegiance Healthcare practitioners without being injurious to oppose the requirement to advise the Corp., 268 F.3d 1352, 1362, 60 USPQ2d the integrity of the proceeding. One Board of any change in the real party- 1482, 1501 (Fed. Cir. 2001) (claim comment recommends the in-interest or in related cases within 20 limitations need not be the same); establishment of a help desk. One of the days of the change. Augustine Med., Inc. v. Gaymar Indus., comments suggested that the phrase Answer: Section 41.8 has been Inc., 181 F.3d 1291, 1300, 50 USPQ2d ‘‘Board employee conducting the reformatted so that the last clause 1900, 1907 (Fed. Cir. 2000) (holding that proceeding’’ be clarified. referring to judicial review is now its the prosecution history of a parent Answer: The prohibition regarding own subsection. Proposed §§ 41.8(a) and application may limit the scope of a other Board employees in § 41.11 has (b) are now §§ 41.8(a)(1) and (a)(2), later application using the same term); been clarified to say ‘‘assigned to the respectively. Elkay Mfg. Co. v. Ebco Mfg. Co., 192 proceeding’’ to give parties a measure of The Federal Circuit requires any F.3d 973, 980, 52 USPQ2d 1007, 1107, confidence in contacting Board officials, change in the real party-in-interest to be 1114 (Fed. Cir. 1999) (prosecution other than administrative patent judges, reported within seven days. Federal history can apply to claim in different that have not been expressly assigned to Circuit Rule (Fed. Cir. R.) 47.4(c). subsequent patent). Claims in the the case. As a general rule, support staff Section 41.8(a)(1) provides nearly triple related case might be estopped by an are not assigned to a proceeding. Other the time the court provides in adverse judgment in the interference Board employees, like administrators, recognition of the greater number of (§ 41.127(a)(1)). A party that is aware of might be assigned an interlocutory role appeals to the Board than to the court, a related case, but nevertheless fails to in a proceeding, but the party would but the Board needs to know such disclose the case may fall short of its have notice of the assignment. The information just as much as the court duty of candor to the Office. If the facts Office agrees that informal contacts with does. of the other case are materially different, support staff can be of great benefit to The burden to report changes in then the related case might have no the parties. The rule is not intended to related cases is not onerous since most material effect on the case before the prohibit, and does not prohibit, such such changes are entirely under the Board. Georgia-Pacific Corp. v. United contacts. control of the affected party. Such States Gypsum Co., 195 F.3d 1322, Comment 29: Three comments note changes would include the filing of a 1333, 52 USPQ2d 1590, 1599 (Fed. Cir. that the supplementary information in continuation application claiming 1999) (inconsistent positions did not the notice of proposed rule making benefit of an application on appeal or affect outcome). provides examples that appear to be the filing of a reissue application for a Comment 27: Five comments oppose more liberal than the rule. One of the patent that is before the Board in a § 41.11 (which was proposed as comments recommended moving the reexamination appeal. The amount of § 41.105), the bar on ex parte examples from the supplementary due diligence involved should be small communications, as too restrictive. information into the rule. for any party with an effective docketing Answer: Proposed § 41.105 has been Answer: The examples are not system. moved to § 41.11 in subpart A and has exceptions to the rule. For example, The last clause of § 41.8(a)(2) is now been revised to refer to inter partes when a party declines to participate in § 41.8(b) to raise its profile, but has been reexaminations under subpart C and a hearing or conference, there is not an limited to contested cases because it is contested cases under subpart D because exception to the rule. Instead, it is a in that context, particularly in the case the concern about ex parte waiver by the non-participating party of of judicial review under 35 U.S.C. 146, communications in adversarial cases is the protections of the rule. A party where the problems arise. Lack of common to both types of proceedings. cannot be permitted a heckler’s veto on
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the opposing party’s ability to the USPQ because of its greater require the fees. Note that trademark- communicate with the Board. Even so, relevance to Board practice. specific fees are located with the the Board will treat such one-sided If the Board were to eliminate the trademark rules in part 2. Cross- communications with caution. For requirement for parallel citation, it references to § 41.20 in the Board rules instance, a transcript of the would make more sense to eliminate the that require the fees should prevent communication may be required. requirement to cite to the West system confusion about where the fees are In another example, informing the reporters. If citation to the USPQ were located. A cross-reference has been Board in one proceeding of a related eliminated, the alternative would not be added at § 1.17(b) to offer further proceeding is not an ex parte citation to West’s printed reporters but guidance. to one of the on-line services, which communication about the contested case Part 41, Subpart B—Ex Parte Appeals as long as the information does not would also raise issues of access and extend beyond identifying information expense. Comment 35: One comment suggests about the other proceeding. Such No reporter system is authoritative. that since appeals are a fairly common information is required under § 41.8. Hallco Mfg. Co. v. Foster, 256 F.3d 1290, procedure, a notice of the changes to the Finally, citing a pending case in 1297 n.4, 59 USPQ2d 1346, 1350 n.4 appeal procedures should be mailed to support of a more general proposition, (Fed. Cir. 2001) (relating an instance each practitioner warning him or her of again is not an ex parte communication where the West reporter misprinted a these changes. Answer: The comment will not be about the contested case as long as the paragraph, while the USPQ printed the adopted. A mailing of a notice of the focus is on the general proposition and decision correctly, and noting that only changes to the appeal procedures to not on the merits of the cited case. For the court’s print of the opinion is each practitioner is not required since it instance, citing a published opinion authoritative). Parallel citation thus also is each practitioner’s responsibility from a pending case has never been serves as a useful check on privately compiled reporters. under 37 CFR Part 10 to stay up-to-date considered an ex parte communication. on patent procedures. Nevertheless, the Similarly, a complaint to the Chief Comment 32: One comment notes that USPQ no longer provides very good Board will attempt to mail a notice of Administrative Patent Judge about the final rule making to every appellant delays in interferences generally, with a coverage of Office decisions while many Board decisions are available through with the docketing notice (see the list of examples, is appropriate provided Notice of revised appeal docketing the complaint stays focused on the on-line services. Answer: Most of the large volume of procedures published in the July 2, 2002 general problem of delays rather than Board decisions that are available on- OG) for several months. issues in a particular cited proceeding. line are not properly citable as Comment 36: One comment suggests Any discussion of a particular aspect of precedent. Consequently, the practical that §§ 41.31(a)(1), (a)(2) and (a)(3) be a particular pending case must be differences in coverage between amended to provide for appeal at any treated formally in accordance with Westlaw and the USPQ are less than the time after being twice or finally rejected, § 41.11. comment purports. as appropriate, during pendency of the Comment 30: One comment suggests There is no ideal solution for which proceeding where no time period under that the rules were inconsistent in reporter system or systems should be § 1.134 is running. The comment states requiring parallel citation to the West required. This is a problem that that the suggested change would ensure Reporter System (West) and to the confronts many adjudicative bodies. that § 41.31 would not be interpreted United States Patents Quarterly (USPQ) The Board has imposed a requirement more restrictively than 35 U.S.C. 134, in contested cases, § 41.106(b)(4)(ii)(B), on itself to cite both West reporters and which sets forth no condition regarding but not in appeals. the USPQ: the former to be responsive when an appeal can be filed, apart from Answer: Proposed § 41.106(b)(4) has to the courts, the latter to address its the requirements for claims being twice been relocated to new § 41.12 in subpart own needs. The citation format used by rejected (as in 35 U.S.C. 134(a)) or A to eliminate the inconsistency. parties before the Board must be finally rejected (as in 35 U.S.C.134(b) Comment 31: Three comments note consistent with Board practice. and (c)). The comment also states that that the Federal Circuit has changed its Comment 33: One comment interprets this amendment would prevent any rules to eliminate the requirement for proposed § 41.106(b)(4)(ii), now potential inconsistency of the rules with parallel citations to a West reporter and § 41.12(b), to bar citation to the Manual the Board’s precedential opinion, Ex the USPQ. Two of the comments object of Patent Examining Procedure (MPEP). parte Lemoine, 46 USPQ2d 1420, 1423 that parallel citation imposes additional The comment suggests that instead great (BPAI 1994). costs on parties. Two of the comments weight should be given to the MPEP. Answer: The suggestion will not be express a preference for not using the Answer: The rule does not bar citation adopted. Sections 41.31(a)(1), (a)(2) and USPQ. One of the comments notes that to the MPEP. Rather the rule (a)(3) were proposed to generally Westlaw, the on-line West service discourages the citation of authority that incorporate the requirements of former provides much more complete coverage is not binding. Primary authority should § 1.191(a) (2003) and to subdivide of current Board decisions than does the be cited for legal issues in papers § 1.191(a) into three parts to improve USPQ. The comments do not address directed to the Board. Unless primary readability. Both former § 1.191(a) the use of any other reporter or database authority is unavailable, primary (2003) and §§ 41.31(a)(1), (a)(2) and service. authority is always preferable to, and (a)(3) are more restrictive than 35 U.S.C. Answer: None of the comments more persuasive than, any secondary 134 in that an appeal must be filed explain why the court made this change authority. within the time period provided under or explain how it is applicable to Board Comment 34: One comment requested § 1.134 for response to either a final practice. Of the printed reporters, USPQ that the fee information in § 41.20 be rejection or a non-final rejection which provides much better coverage of patent restored to § 1.17, particularly since rejects the claims for a second time, as decisions relevant to Board practice some of the § 41.20 fees must be paid appropriate. For example, an applicant than West does. The Board cites to the before jurisdiction passes to the Board. for a patent whose claims have been West system as a courtesy to its Answer: The fees were moved to part twice rejected but not finally rejected, reviewing courts, but principally uses 41 to locate them with the rules that may appeal from the decision of the
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examiner to the Board by filing a notice and Interferences, having once paid the reference to § 41.50(c) as to permitted of appeal accompanied by the fee set fee for such appeal.’’ According to the amendments. forth in § 41.20(b)(1) within the time effective date provisions of Public Law Answer: The suggestion has been period provided under § 1.134. 106–113, the provisions of 35 U.S.C. adopted. However, if such an applicant files an 134(b) apply to any reexamination Comment 42: One comment suggests amendment within the time period proceeding filed on or after November incorporating § 41.33(c) into § 41.33(b), provided under § 1.134, the applicant 29, 1999. Accordingly, by law, the and having § 41.33(b) refer both to may not file an appeal outside the time patent owner must wait until an ‘‘amendments’’ and ‘‘affidavits or other period provided under § 1.134. In such examiner makes a second or subsequent evidence’’ submitted after filing an a situation, the applicant must wait for rejection final, before being permitted to appeal. The comment states that this a new rejection by the examiner before file an appeal in a reexamination change would avoid separate discussion an appeal can be filed. proceeding and therefore both of amendments, affidavits and other Comment 37: One comment suggests §§ 41.31(a)(2) and (a)(3) are necessary to evidence. that paragraphs (a)(1) and (a)(2) of inform a patent owner when an appeal Answer: The suggestion will not be § 41.31 be amended to remove the in a reexamination proceeding may be adopted since the prohibition against alternative clause (i.e., ‘‘or finally’’) taken. these filings is no longer the same. See since this would make it clear that once Comment 39: One comment suggests Comment 41. the examiner rejects a claim for the that proposed § 41.33 be amended to Comment 43: Five comments assert second time (in the same application or refer to the ‘‘date of filing an Appeal’’ that proposed § 41.33 would unduly in a continuing application), the as opposed to referring to ‘‘after the date restrict the types of amendments and decision as to whether to appeal the the proceeding has been appealed.’’ evidence that can be made after a Notice rejection or continue proceedings before This change would ensure consistency of Appeal is filed. One suggested the examiner will rest with the with Office language used in other solution was to remove paragraphs (b) applicant. The comment notes that since regulations relative to ‘‘filing dates.’’ and (c) of § 41.33 and instead rely upon a final rejection will never be made in The original language is confusing as it (or substitute) the provisions of § 1.116. a first rejection of a claim, the is not clear whether the date the A second suggested solution was to alternative language is not necessary ‘‘proceeding has been appealed’’ is the amend paragraphs (b) and (c) of § 41.33 and that the change is being suggested date typed by the Applicant on the to take effect once the appeal brief is to reduce the periodic disputes between Notice of Appeal, the date of the filed. A third suggested solution was examiners and applicants as to whether Certificate of Mailing affixed on a Notice that amendments making claim(s) an application under a non-final of Appeal, or the date of filing accorded allowable be permitted thus resolving rejection was ripe for appeal. by the Office to the Notice of Appeal. Answer: The suggestion has been issues that would otherwise be Similarly, it is not clear what the date adopted. The Board’s precedential appealed. is that an amendment was ‘‘submitted.’’ opinion in Ex parte Lemoine, 46 Answer: The comments have been Do certificates of mailing or certificates USPQ2d at 1423, interpreted the adopted to the following extent. of facsimile transmission, impact on the language of 35 U.S.C. 134 that gives Amendments submitted on or after the date of ‘‘submission’’ or the date that applicants the statutory right to an date the proceeding has been appealed administrative appeal to mean that ‘‘so ‘‘the proceeding has been appealed’’? A may be admitted as provided in § 1.116. long as the applicant has twice been well accepted term like ‘‘date of filing’’ Thus, amendments after final but prior denied a patent, an appeal may be used consistently throughout the to appeal and amendments filed after filed.’’ Thus, the alternative language of paragraph would avoid any possible appeal but prior to the date the brief is the proposed rule (i.e., ‘‘or finally confusion. filed will be treated under the same (§ 1.113 of this title)’’ is not necessary. Answer: The suggestions have been standard (i.e, § 1.116). Amendments Comment 38: One comment suggests adopted in § 41.33 and § 41.63. filed on or after the date of filing a brief that § 41.31(a)(3) be deleted. The Comment 40: One comment suggests may be admitted only to cancel claims, comment states that this would that the word ‘‘may’’ be replaced with where such cancellation does not affect eliminate the requirement that the the word ‘‘will’’ in § 41.33. The the scope of any other pending claim in patent owner wait until an examiner comment states that this suggestion is the proceeding, or to rewrite dependent makes a second or subsequent rejection made to avoid any possible confusion or claims into independent form. All other final, before being permitted to file an abuse of the regulations by examiners amendments submitted after the date appeal in a reexamination proceeding and that there should be no flexibility the proceeding has been appealed will filed on or after November 29, 1999 and given to examiners in entering minor not be admitted except as permitted by thus would restore to patentee the cosmetic amendments as envisioned in §§ 41.39(b)(1), 41.50(a)(2)(i), 41.50(b)(1) decision as to when to file an appeal in this portion of the paragraph. and 41.50(c). Affidavits or other a reexamination proceeding that is Answer: The suggestion will not be evidence submitted after the date the subject to repeated rejections. The adopted. The use of the word ‘‘may’’ in proceeding has been appealed and prior comment also notes that the deletion of § 41.33 rather then the word ‘‘will’’ is to the date a brief is filed overcoming all § 41.31(a)(3) would simplify the appropriate since it (1) is consistent rejections under appeal may be regulations as there would no longer be with the current use of the word ‘‘may’’ admitted if the examiner determines a need to determine filing dates of in § 1.116; and (2) connotes that entry of that the affidavits or other evidence reexamination proceedings under this amendments and evidence filed after overcomes all rejections under appeal section. appeal is not a matter of right but that and a showing of good and sufficient Answer: The suggestion will not be such amendments and evidence filed reasons why the affidavit or other adopted. 35 U.S.C. 134(b) provides that after appeal may be admitted under evidence is necessary and was not ‘‘[a] patent owner in any reexamination certain circumstances set forth in the earlier presented. All other affidavits or proceeding may appeal from the final rule. other evidence submitted on or after the rejection of any claim by the primary Comment 41: One comment notes that date the proceeding has been appealed examiner to the Board of Patent Appeals § 41.33(b) should also include a will not be admitted except as permitted
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by §§ 41.39(b)(1), 41.50(a)(2)(i) and a dependent claim that has been Answer: The suggestion will not be 41.50(b)(1). identified by the examiner as being adopted. The suggestion is based on the Comment 44: Two comments state allowable. belief that the two-month period for that the proposed rules are unclear as to Answer: The suggestion is adopted to filing an appeal brief that runs from the subsequent appeal procedures after the extent that the Manual of Patent date of filing of the notice of appeal prosecution is reopened subsequent to Examining Procedure will provide that would expire before applicants have the filing of a first Notice of Appeal and rewriting dependent claims into received a decision from the examiner Appeal Brief. Specifically, the independent form as permitted under on an amendment filed under § 1.116 comments question if prosecution is § 41.33 includes the following (i.e., an amendment filed after a final reopened under either § 41.39(b)(1), situations: (1) Rewriting a dependent rejection but before or with the filing of § 41.50(a)(2)(i) or § 41.50(b)(1), and a claim in independent form by adding a notice of appeal). It is expected that subsequent appeal is taken, would thereto the limitations of the parent such a situation would be rare. In that applicant be required to again pay the claim(s); and (2) rewriting an rare situation, applicants can obtain an Notice of Appeal and Appeal Brief fees. independent claim to incorporate extension of time as provided in The comments believe that this extra therein all the subject matter of a § 41.37(e). In addition, applicants can cost is unfair and burdensome to dependent claim, canceling the delay filing the notice of appeal until applicants because the reopening of dependent claim and in conjunction they have received a decision from the prosecution would be the result of therewith changing the dependency of examiner on the amendment filed under action by the examiner or the Board, not claims which had depended from the § 1.116 especially if the amendment action by applicants. Accordingly, the dependent claim being canceled to the filed under § 1.116 is filed within two comments suggest that provision should amended independent claim that months from the date of mailing of any be made in the proposed rules that incorporate therein all the subject final rejection setting a three-month applicants need not twice pay the matter of the now canceled dependent shortened statutory period for reply Notice of Appeal and Appeal Brief Fees claim. since it is Office policy (see MPEP in an application where those fees have Comment 46: One comment suggests 714.13) that if the advisory action is not already been paid but prosecution was that § 41.37(a)(1) be amended, as mailed until after the end of the three- then reopened. suggested for § 41.33, to reference the month shortened statutory period, the Answer: The comment will not be ‘‘date of filing the notice of appeal,’’ period for reply to the final rejection for adopted. The rule making did not rather than the uncertainty that might be purposes of determining the amount of propose to change the current introduced by the phrase ‘‘the date of any extension fee will be the date on procedures in this area. Currently, once the notice of appeal.’’ which the Office mails the advisory a Notice of Appeal and Appeal Brief fee Answer: The suggestion has been action advising applicant of the status of has been paid in a proceeding, a second adopted. the application, but in no event can the Notice of Appeal and Appeal Brief fee Comment 47: One comment inquires period for reply to the final rejection will not be required except if a final if the ‘‘date of the notice of appeal’’ extend beyond six months from the date Board decision has been made on the referred to in § 41.37(a) is the date the of the final rejection. first appeal. For example, in an notice of appeal is signed, is filed, or is Comment 49: One comment inquires application for patent, a Notice of received by the Office. how the real party in interest should be Appeal and Appeal Brief fees have been Answer: As under current practice, identified in the appeal brief when the paid and the examiner reopens the date of filing the notice of appeal is application involved in the appeal is prosecution in a new Office action, new either (1) the date of deposit with the assigned to a subsidiary corporation fees are not required for an applicant to United States Postal Service if the which corporation is owned by either a appeal from that new Office action. provisions of 37 CFR § 1.10 are parent corporation or a joint venture Another example is in an application for followed; or (2) the date of receipt by between corporations. patent, a Notice of Appeal and Appeal the Office. Answer: When an application is Brief fees have been paid and the Board Comment 48: One comment suggests assigned to a subsidiary corporation, the in its decision makes a new ground of that the clause ‘‘or within the time real party in interest is both the assignee rejection and the applicant elects to allowed for reply to the action from and either the parent corporation or reopen prosecution before the examiner, which the appeal was taken, if such corporations, in the case of joint then new fees are required for an time is later’’ be added at the end of ventures. One example of a statement applicant to appeal from any new Office paragraph 41.37(a)(1). The comment identifying the real party in interest is: action by the examiner. The same notes that this language currently The real party in interest is XXXX procedures apply under the rules as appears in former § 1.192(a) (2003), and corporation, the assignee of record, implemented in this rule making. this additional time is a valuable option which is a subsidiary of a joint venture Comment 45: One comment suggests to applicants who file a notice of appeal between YYYY corporation and ZZZZ that it ought to be made clear that the with no intention of filing an appeal corporation. words of § 41.33, ‘‘rewrite dependent brief, but are filing the appeal simply to Comment 50: One comment suggests claims into independent form,’’ buy some additional time to permit the that a requirement to identify the real includes both of the following two examiner to rule on an amendment filed party in interest should be made in situations: (1) In conjunction with the under § 1.116. The comment states that contested cases, perhaps as part of a re- rewriting of a dependent claim in any docketing benefits gained by the named § 41.108. independent form, amendment(s) would proposed change in this paragraph, as Answer: Section 41.8 entitled be allowed changing the dependency of discussed by the proposed rule drafters, ‘‘Mandatory notices’’ already requires claims which had depended from the is far outweighed by the disadvantage to that at the initiation of a contested case independent claim being canceled, and both applicants and the Office in having (§ 41.101), and within 20 days of any (2) rather than rewriting a dependent applicants file a brief simply as a change during the proceeding, a party claim in independent form, an strategy to maintain pendency, while must identify its real party-in-interest. independent claim can be amended to the examiner renders a decision on an Comment 51: One comment suggests incorporate therein the subject matter of amendment filed under § 1.116. that the requirement in § 41.37(c)(1)(ii)
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to identify related proceedings is required, does the explanation have to instead of the ‘‘invention,’’ it is ambiguous with respect to its scope. show how each claim is different, does expected the explanation will be more The comment believes that read the requirement apply to all drawings ‘‘concise’’ than if the prosecution and broadly, it would require an appellant to and embodiments, or only a examination has been conducted on the identify every precedential decision that representative drawing? The comment basis of the ‘‘invention.’’ As to what is might bear on the issues on appeal and states that the Office deleted a similar required, the proposed rule states that could expose an appellant to requirement in 1992 relating to reference to the specification by page unreasonable allegations of inequitable documents submitted in an IDS because and line number, and to the drawing, if conduct. ‘‘concise explanation’’ descriptions any, by reference characters is required. Answer: The requirement in rarely communicated any useful Appellant may include any other § 41.37(c)(1)(ii) to identify related information, improved the quality of information of record which will aid the proceedings does not require an patent examination but provided an Board in considering the subject matter appellant to identify prior proceedings opportunity to attack the patent on the of each independent claim. The involving unrelated parties including grounds of inequitable conduct. The explanation does not have to show how precedential decisions that might bear comment suggests that the requirement each claim is different. The purpose of on the issues on appeal. The be clarified or dropped. the requirement is to aid the Board in requirement in § 41.37(c)(1)(ii) to Answer: A patentability determination considering the subject matter of the identify related proceedings does must be performed on a claim-by-claim independent claims so that an informed require an appellant to identify every basis. The first step in a patentability review of the examiner’s adverse related proceeding (e.g., commonly determination is to construe a given determination of patentability can be owned applications having common claim and determine its metes and made. Whether the explanation is subject matter, claim to a common bounds. ‘‘Analysis begins with a key limited to a single drawing or priority application). legal question—what is the invention embodiment or is extended to all Comment 52: One comment suggests claimed?’’ since ‘‘[c]laim interpretation drawings and embodiments is a that § 41.37(c)(1)(iii) be deleted in its * * * will normally control the decision appellant will need to make. entirety, as it introduces an unnecessary remainder of the decisional process.’’ The proposed concise explanation of additional burden on appellants with no Panduit Corp. v. Dennison the subject matter defined in each discernible benefit to the Office. The Manufacturing Co., 810 F.2d 1561, independent claim is different from a comment states that since only rejected 1567–68, 1 USPQ2d 1593, 1597 (Fed. concise explanation of a reference. It is claims are subject to an appeal, there Cir.), cert. denied, 481 U.S. 1052 (1987). the applicant who is responsible for seems to be no benefit in identifying the The existing provisions of 37 CFR drafting claims and choosing the status of claims that are not subject to § 1.192(c)(5) (2003) are directed to language and terms used to define the appeal and that asking appellants to providing a summary of the claimed invention. 35 U.S.C. 112(2) make this type of listing for claims that ‘‘invention,’’ not the claims. See In re (‘‘The specification shall conclude with are not rejected and thus are not subject Hiniker Co., 47 USPQ2d 1523 (Fed. Cir. one or more claims particularly pointing to appeal, would introduce a risk of 1998): ‘‘The invention disclosed in out and distinctly claiming the subject inadvertent error by appellants and in Hiniker’s written description may be matter which the applicant regards as any event, would likely be ignored by outstanding in its field, but the name of his invention.’’) As the originator of the the examiner and the Board. the game is the claim. See Giles claim language, applicant should know Answer: The suggestion will not be Sutherland Rich, Extent of Protection what is intended by the various words adopted. Section 41.37(c)(1)(iii) and Interpretation of Claims—American and phrases used to define the claimed generally incorporates only the Perspectives, 21 Int’l Rev. Indus. Prop.’’ subject matter and thus, providing a requirements of former § 1.192(c)(3) By statute, the Board reviews ‘‘adverse concise explanation of the subject (2003) that a statement of the status of decisions of examiners upon matter of each independent claim as all the claims be presented and an applications for patents.’’ 35 U.S.C. 6(b). proposed should not be an undue identification of those claims that are For the Board to reach an informed burden. This is in contrast to explaining being appealed. As such it does not decision on the merits of a rejection the possible relevance of a document introduce an unnecessary additional presented for review, the record should that may not have originated from burden on appellants. Moreover, the reflect the respective positions of the applicant. Another difference is that the benefit to the Office of this requirement examiner and appellant as to the scope number of independent claims is that the Board is directly informed as of the claims. It is the experience of the presented for review in an appeal is a to the status of all the claims in the Board that the prosecution and matter directly within appellant’s proceeding (e.g., rejected, allowed or examination in a significant number of control, while appellant does not have confirmed, withdrawn, objected to, appeals forwarded for decision on control over the number of documents canceled) and which of those claims appeal has taken place in the context of that should be cited to the Office. that are being appealed. For example, ‘‘applicant’s invention,’’ not on a claim- The subject matter of each should the Board have knowledge of by-claim basis. Thus, the Board is independent claim needs to be any grounds not involved in the appeal oftentimes confronted with a record in concisely explained for a number of for rejecting any pending claim, the which no significant claim construction reasons. For example, if the Board Board under the authority of § 41.50(b) has occurred. Those records are not decides that a rejection is to be reversed may make a new ground of rejection. susceptible to meaningful review and for a given independent claim, the Comment 53: One comment expresses result in an inordinate number of remaining independent claims must be concern in regard to the requirement of remands. reviewed to determine if the reasons for proposed § 41.37(c)(1)(v) that a concise The determination of how ‘‘concise’’ reversing the rejection of the first explanation of the subject matter the explanation must be will need to be independent claim apply to the defined in each of the independent determined on a case-by-case basis. If remaining independent claims. claims involved in the appeal be the prosecution and examination has Furthermore, if appellant chooses to provided. Specifically the comment asks been based upon a discussion of the argue a group of claims which includes what is a concise statement, what is patentability of individual claims more than one independent claim, the
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Board will need to review, at the least, and to the drawing, if any, by reference individual claims presented for review. each independent claim to determine characters only for each independent The suggestion that this provision apply which claim will be selected as claim involved in the appeal and for only to the independent claims or representative of the group. Apart from each dependent claim argued separately claims that are separately argued is reviewing the examiner’s adverse under the provisions of adopted. decision on patentability, the Board may § 41.37(c)(1)(vii). Whether a statement Issues regarding whether the language also make new grounds of rejection made by an applicant during chosen by applicant to define a claim pursuant to former § 1.196(b) (2003) or procurement of the patent from the limitation falls within 35 U.S.C. 112(6) make an explicit statement that a claim Office results in an estoppel is a matter are discussed in MPEP 2181. Whether would be allowable if amended under that is ultimately decided during specific claim language invokes the former § 1.196(c) (2003). The concise proceedings outside the Office. The provisions of 35 U.S.C. 112(6) is a explanation of the subject matter of each decision to grant the patent by the merits issue to the extent it involves the independent claim will aid the Board in Office must be based upon a firm and determination of claim scope. If an making these determinations. clear understanding of the scope of the applicant believes that an examiner has Comment 54: Several comments individual claims. If the prosecution not followed proper procedure, relief address the provision of proposed and examination of claims involving may be had by way of a petition under § 41.37(c)(1)(v) that every means plus issues under 35 U.S.C. 112(6) has been § 1.181. function and step plus function as based upon individual claims and in The proposal to make this permitted by 35 U.S.C. 112(6) used in accordance with the procedures set requirement a procedural tool instead of the claims be identified and the forth in MPEP 2181 for claim language a substantive requirement is not structure, material, or acts described in involving issues under this section of adopted. Claim construction during any the specification as corresponding to the statute, it is anticipated that this stage of a patentability determination is each claimed function be set forth with aspect of the rule will be based upon the a substantive matter, not a procedural reference to the specification by page statements and determinations already tool, as it controls the substantive and line number, and to the drawing, if of record and thus does not constitute application of the law and facts to the any, by reference characters. A number a significant burden. See MPEP 2181 claim language under review. Comment 55: A comment was made of comments express concern that this (explaining that the Office must apply in regard to proposed § 41.37(c)(1)(vii) requirement may result in a limiting 35 U.S.C. 112(6) in appropriate cases, that examiners will sometimes only claim construction or create prosecution and give claims their broadest reject the independent claims or make a history estoppel. The comments also reasonable interpretation, in light of and ‘‘jumbled’’ rejection where it is not clear take the position that the requirement consistent with the written description what arguments apply to which claims. would be unduly burdensome in that of the invention in the application, Under these circumstances the comment appellant would need to provide this citing In re Donaldson, 16 F.3d 1189, analysis whether a claim limitation was believes that it is a burden to require 1194, 29 USPQ2d 1845, 1850 (Fed. appellant to provide separate argument in ‘‘issue’’ in the appeal. Another Cir.1994)). However, if the prosecution comment indicates that the proposed for each and every dependent claim. and examination has been based upon The comment also states that ‘‘it [the rule is not clear as to whether it applies the ‘‘invention’’ and not individual to ‘‘all drawings and embodiments, or rule or the rejection?] pushes Applicants claims, it may be that appellant will be into the position of having to make only a representative drawing.’’ Another making statements regarding claim comment expresses concern that the potentially prejudicial statements scope for the first time during the proposed rule may be subject to abuse, regarding claims, where the Examiner appeal proceeding. To the extent this is as where an examiner takes the position has not initially met the burden of seen as a burden or creating a possible that claims that are not couched in providing a prima facie case of estoppel, it may be that this is an means-plus-function terminology of 35 obviousness. Where the grounds of indication that the case, while eligible U.S.C. 112(6) are nevertheless subject to rejection are of the nature that the for an appeal under the statute and the the provisions of that section and this Examiner has failed to indicate what rules, may not be ready for an appeal. proposed rule. Suggested changes grounds of rejection apply to a group of include using the rule as a procedural The comments expressing concern claims, Applicants should simply be tool rather than a substantive that the proposed rule extends to 35 able to say this, without thereby risking requirement or to require only the U.S.C. 112(6) limitations which are not that the group of claims stands or falls identification of one or more examples in ‘‘issue’’ are presumably based upon together.’’ A second comment expresses of the support for each independent or the perspective that appellant and the concern that failure of appellant to separately argued claim, rather than all examiner have agreed upon the correct separately argue claims which appellant examples of support for every claim. construction of such characterized has grouped together shall constitute a Another suggested change is that any limitations during the prosecution and waiver of any argument that the Board issues in regard to the Board’s need for examination of the application up to the must consider the patentability of any such an identification in order to reach appeal stage, not that such characterized grouped claim separately may impact a reasoned decision be addressed by limitations have been ignored or not the ultimate presumption of each claim way of an order under the existing commented upon during the pre-appeal in an issued patent under 35 U.S.C. 282, provisions of § 1.196(d) (2003). proceedings. If the former has occurred, noting that the current rule does not Answer: The suggestion is adopted to it should not be an undue burden to contain any waiver provision. the extent that every means plus provide the needed analysis. If the latter Answer: Patentability must be decided function and step plus function as applies, appellant will need to directly on a claim-by-claim basis. Merits permitted by 35 U.S.C. 112(6) must be address each limitation so that the decisions of the Board in ex parte identified and the structure, material, or record is clear as to where the appeals must determine the acts described in the specification as underlying structure, steps or materials patentability of individual claims, not corresponding to each claimed function are described in the written description whether an ‘‘invention’’ is patentable or must be set forth with reference to the of the application so that the Board can a group of claims is patentable. Thus, specification by page and line number, understand the subject matter of the the arguments in the Appeal Brief are
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preferably directed to individual claims. and preparing Office actions is typically first Office action or after a non-final If appellant chooses to argue claims as contained in the MPEP, not the rules. rejection may be presumed to have been a group as permitted, the Board will The procedural requirements examiners entered only when treated by an pick a single claim to decide the appeal must follow in preparing an Examiner’s examiner in an Office action. to the group of claims as to that ground Answer are found in MPEP 1208. Accordingly, the requirement of of rejection. If the prosecution and Comment 57: One comment suggests § 41.37(c)(1)(ix) of a statement setting examination of a case has proceeded to that § 41.37(c)(1)(vii) be amended to add forth where in the record the evidence the point of an appeal without applicant the word ‘‘separate’’ prior to was entered in the record by the and the examiner discussing the merits ‘‘patentability’’ in the last sentence. The examiner is met by an explicit statement of individual claims, that is an comment states that this would clarify entering the evidence or implicitly by indication that the case is not ready for that pointing out what a claim recites an Office action weighing the evidence. an appeal. If applicant believes that a will not be considered an argument for Prior to filing an appeal brief, if rejection set forth in an Office action is ‘‘separate’’ patentability of a claim, applicants have submitted evidence to ‘‘jumbled’’ or in any other manner does since such an argument could in fact the examiner and it is not clear if this not clearly communicate the facts and establish patentability of that claim evidence has been entered or not reasons why the individual claims without establishing ‘‘separate’’ entered, appellants should contact the subject to the rejection are unpatentable, patentability of the claim. examiner to inquire as to the status of relief may be available by way of a Answer: The suggestion to add the that evidence. For example, if a § 1.132 petition under § 1.181. word ‘‘separate’’ prior to ‘‘patentability’’ declaration is timely filed in response to The waiver provision of the proposed in the last sentence has been adopted in non-final Office action and the next rule reflects the view expressed in In re § 41.37(c)(1)(vii) and § 41.67(c)(1)(vii). action by the examiner is a final McDaniel 63 USPQ2d 1462, 1468 (Fed. Comment 58: One comment inquires rejection which does not mention the Cir. 2002) (Mayer, C.J. dissenting-in- if the requirement in § 41.37(c)(1)(ix) for § 1.132 declaration, applicants should part) that ‘‘in stating that claims 53–64 an evidence appendix containing copies contact the examiner to inquire as to the stand or fall together, [McDaniel] has of any evidence submitted to the status of the § 1.132 declaration before examiner and relied upon by the waived any argument that claims 55–57 filing an appeal since a brief arguing appellant in the appeal was inconsistent are patentable for reasons independent that evidence is not permitted by with the provision in § 41.7(b) that of claim 53.’’ § 41.37(c)(1)(ix). The likely result of precludes a party from filing a paper Comment 56: One comment notes that such an inquiry would be a new Office previously filed in the same Board each appeal is unique and that there ‘‘is action treating the § 1.132 declaration or proceeding without Board no good reason for making detailed being informed that the Office has no authorization. requirements as to the form of record of the § 1.132 declaration. presentation of explanations and Answer: Section 41.7(b) has been Comment 60: One comment requests arguments in an appeal brief’’ as amended so that the requirement in clarification as to whether appendixes proposed in § 41.37(c)(1)(vii). The § 41.37(c)(1)(ix) for an evidence as required by §§ 41.37(c)(ix-x) are comment observes that the ‘‘Office appendix containing copies of any necessary at all when no evidence or properly assumes that an examiner is evidence submitted to the examiner and capable of responding to any appeal relied upon by the appellant in the related proceedings exist, or whether an brief under either the existing rule or appeal is consistent with the provisions appendix must be included with the the proposed rule each of which simply of § 41.7(b). indication ‘‘none.’’ requires a written statement in answer Comment 59: One comment suggests Answer: Sections 41.37(c)(ix-x) to appellant’s brief including such that § 41.37(c)(1)(ix) be amended to require the appeal to contain an explanation of the invention claimed require identification of ‘‘when the evidence appendix and a related and of the references and grounds of evidence was submitted into the record proceedings appendix. If no evidence or rejection as may be necessary. The by Applicants or where in the record related proceedings exist, an evidence comment asks the questions ‘‘Should that evidence was entered in the record appendix should be included with the not the same simple requirements be in by the Examiner.’’ The comment states indication ‘‘none’’ and a related effect as to the appeal brief? What’s that this suggestion was made since proceedings appendix should be sauce for the goose should be sauce for examiners will frequently not make a included with the indication ‘‘none.’’ In the gander?’’ positive statement indicating approval addition, a brief containing a Table of Answer: The structure provided for by of entry into the record of evidence Contents indicating that no evidence the requirements of § 41.37 ensures that presented by applicants. The comment appendix is part of the brief or that no Appeal Briefs will provide the states that absent specific indication by related proceedings appendix is part of information the Board needs to render the examiner that any evidence the brief would be acceptable under the an informed decision on the issues submitted was refused entry, the Rule since it would clearly indicate that presented for review. While each appeal evidence is presumed to have been no evidence is being relied upon by the is unique in regard to the issues and entered as of the submission date. Thus, appellant in the appeal or that no arguments presented, there is certain the suggested change would remove any related proceedings having decisions information common to each appeal ambiguity regarding how to comply rendered by a court or the Board exist. which is amenable to being provided by with this requirement should the Comment 61: One comment states way of a prescribed format. The view examiner not make an affirmative entry that it would be useful to have an expressed in the comment that of the evidence. example of a format and content for an examiners are under ‘‘simpler Answer: The suggestion is not appeal brief that would comply with the requirements in preparing an adopted. Evidence submitted after final new regulations published with the Examiner’s Answer than appellant is in rejection is not presumed to have been notice of final rule making and preparing the Appeal Brief’’ is entered and must be specifically ultimately incorporated into the Manual misplaced. Detailed guidance to admitted by the examiner as set forth in of Patent Examining Procedure. examiners as to procedural § 1.116 as amended by this rule making. Answer: An example of a format and requirements in performing their duties Evidence submitted either before the content for an appeal brief is a brief
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containing the following items, with be of assistance in the consideration of have allowed cases to go forward to the each item starting on a separate page: the merits of the issues on appeal. Board without addressing the new (1) Identification page setting forth the During the appeal conference, the argument. Section 41.39(a)(2) will applicant’s name(s), the application participants of the appeal conference improve the quality of examination and number, the filing date of the will decide whether a new ground of possibly reduce pendency by providing application, the title of the invention, appeal is appropriate. On the examiner’s for the inclusion of a new ground of the name of the examiner, the art unit answer, the word ‘‘conferees’’ should be rejection in an examiner’s answer. of the examiner and the title of the included, followed by the typed or Comment 67: One comment suggests paper (i.e., Appeal Brief) printed names of the other appeal that the Office should require the (2) Table of Contents page(s) conference participants. The appeal examiner making a new ground of (3) Real party in interest page(s) conference participants will place their rejection to acknowledge any mistakes (4) Related appeals and interferences initials next to their name to make clear the examiner may have made, explain page(s) that the appeal conference has been the time and circumstances in which (5) Status of claims page(s) held. A Technology Center Director or the new ground of rejection became (6) Status of amendments page(s) designee must also initial/approve an known to the examiner, and explicitly (7) Summary of claimed subject examiner’s answer containing a new point out to which arguments in the matter page(s) ground of rejection. brief the new ground of rejection is (8) Grounds of rejection to be Comment 65: One comment suggests responsive. reviewed on appeal page(s) that allowing the examiner to institute Answer: The suggestion will not be (9) Argument page(s) a new ground of rejection in the adopted. The making of a new ground (10) Claims appendix page(s) examiner’s answer is unfair to the of rejection in an examiner’s answer is (11) Evidence appendix page(s) appellant and the examiner should be in itself an acknowledgment of an error (12) Related proceedings appendix required to reopen prosecution. made in the rejection under appeal. page(s). Answer: If the examiner institutes a Requiring the examiner to explain the Comment 62: One comment suggests new ground of rejection in the time and circumstances in which the that the reference to §§ 41.31–41.37 in examiner’s answer, then the appellant new ground of rejection became known § 41.39(a)(1) be changed to refer to has two months to either request that to the examiner and to explicitly point § 41.31 or § 41.37. prosecution be reopened by filing a out to which argument in the brief the Answer: The suggestion has been reply under § 1.111 or file a reply brief new ground of rejection is responsive adopted. In addition, a similar change under § 41.41, which would act as a would delay prosecution and be of little has been made to § 41.69(a)(1). request that the appeal be maintained. or no value in determining the Comment 63: One comment Accordingly, although the examiner appropriateness of the new ground of recommends that § 41.39(a)(1) be may in limited situations institute a new rejection. As set forth above, a amended to clarify the manner in which ground of rejection on appeal, the Technology Center Director or designee the Director will notify the public as to appellant has the right to request that must initial/approve an examiner’s the time within which the primary prosecution be reopened. An appellant answer containing a new ground of examiner will be required to furnish a may not wish to have prosecution rejection. The Technology Center written answer to the appeal brief. reopened if the new ground of rejection Director or designee will be aware that Answer: The comment will not be is similar to a prior rejection or if the allowing a new ground of rejection in an adopted. The Director currently notifies evidence of record is sufficient to examiner’s answer is not open-ended the public as to the time within which address the rejection. Moreover, but is envisioned to be rare rather than the primary examiner is expected to reopening prosecution may prolong a routine occurrence. In addition, the furnish a written answer to the appeal examination without any benefit to the Office plans to issue instructions that brief in the MPEP. Section 1208 of the appellant. will be incorporated into the MPEP as MPEP provides that ‘‘[t]he examiner Comment 66: One comment suggests to what circumstances would be should furnish the appellant with a that the new arguments are necessary in appropriate for entry of a new ground of written statement in answer to the the appeal brief because the conferees rejection in an examiner’s answer rather appellant’s brief within 2 months after and supervisors are more experienced than reopening of prosecution. the receipt of the brief by the examiner.’’ than the examiner and if the case Comment 68: One comment suggests Comment 64: Several comments proceeds to the Board, the audience is that any new grounds of rejection be suggest that any new ground of rejection an APJ, who has quite different limited to new rejections made in be approved by the appeal conference in qualifications than either the conferee or response to an argument presented for the Technology Center or by a the supervisor. Moreover, the comment the first time in an appeal brief. Technology Center Director. suggests that the rule is unnecessary Answer: The comment is not adopted. Answer: The suggestion is adopted to because nothing in the rule prevents the As set forth above, the Office plans to the extent that the MPEP will provide examiner from responding to new issue instructions that will be that each examiner’s answer containing arguments raised in the appeal brief. incorporated into the MPEP as to what a new ground of rejection must be Answer: Former § 1.193(a)(2) (2003) circumstances would be appropriate for approved by a Technology Center prohibited an examiner’s answer from entry of a new ground of rejection in an Director or designee. An appeal including a new ground of rejection examiner’s answer rather than conference is mandatory in all cases in except under very limited reopening of prosecution. An examiner which an acceptable appeal brief has circumstances. Accordingly, an will be permitted to make a new ground been filed. The participants of the examiner could not respond to a new of rejection in an examiner’s answer in appeal conference should include (1) argument raised in an appeal brief by the situation where an examiner the examiner charged with the adding a new ground of rejection in the obviously failed to include a dependent preparation of the examiner’s answer, examiner’s answer. Because the former claim in a rejection. (2) a supervisory patent examiner (SPE), appeal rules only allowed the examiner For example, in the final rejection, and (3) another examiner, known as to make a new ground of rejection by claims 1, 13, and 27 were rejected under conferee, having sufficient experience to reopening prosecution, some examiners 35 U.S.C. 102(b) as being anticipated by
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U.S. Patent No. Y. Claim 27 depended answer is envisioned to be a rare, rather However, a reply brief filed in upon claim 22 which depended upon than routine, occurrence. The Office response to a new ground of rejection in claim 13 which depended upon claim 1. will provide guidance to the examiners accordance with § 41.39(b)(2) can be a No rejection of claim 22 was set forth in in the MPEP as to what circumstances substitute brief replacing the original the final rejection; however, the would be appropriate for entry of a new brief by responding to both the new summary sheet of the final rejection ground of rejection in an examiner’s ground of rejection and all remaining indicated claims 1, 13, 22 and 27 as answer rather than reopening grounds of rejection covered in the being rejected. In this situation, the prosecution. original appeal brief. In such an examiner would be permitted to reject Comment 71: One comment suggests instance, the reply brief must meet all claim 22 under 35 U.S.C. 102(b) as being that § 41.39(c) be changed to state that the requirements of a brief as set forth anticipated by U.S. Patent Y as a new extensions under § 1.136(a) are not in § 41.37(c). ground of rejection in the examiner’s applicable only to the time period for Comment 73: One comment suggests answer. Accordingly, it would not be filing a reply brief under § 41.39(b)(2), that proposed § 41.41 be amended to appropriate to limit new grounds of thereby permitting an appellant to allow a reply brief to include a new or rejection to only a rejection made in obtain an appropriate extension of time non-admitted amendment, affidavit or response to an argument presented for under § 1.136(a) for filing of a response other evidence upon a showing of good the first time in an appeal brief. when re-opening prosecution under and sufficient reasons why they are Nevertheless, it will be the policy of § 41.39(b)(1). necessary and were not earlier the Office that, in general, if an Answer: The comment will not be presented. appellant has previously submitted an adopted. It is believed to be beneficial Answer: The suggestion is not argument during prosecution of the to applicant to provide a single adopted. An appeal should be decided application and the examiner has mechanism to extend the two-month upon a fixed record, not an ever- ignored that argument, the examiner time period to respond to an examiner’s changing one. While it is proposed to will not be permitted to add a new answer containing a new ground of allow examiners to make a new ground ground of rejection in the examiner’s rejection. Having one extension of time of rejection once again, the appellant may request prosecution be reopened answer to respond to that argument but provision if the applicant elects to under proposed § 41.39(b)(1) to would be permitted to reopen reopen prosecution before the primary supplement the record. Absent a new prosecution, if appropriate. examiner and another extension of time Comment 69: Two comments suggests ground of rejection in the Examiner’s provision if the applicant elects to that if the Office introduces a new Answer, the record before the Board maintain the appeal by filing a reply ground of rejection, then the appellant should remain fixed as of the date the brief can easily cause problems should have a full range of prosecution appeal brief is filed so that a reasoned especially when the applicant has not options available and not be limited to review of the record may efficiently take yet decided which course of action to amendments and/or evidence place. follow. responding to the new ground of Comment 74: Two comments express rejection. Comment 72: One comment asks concern that the option of permitting a Answer: The options provided by whether a reply brief filed in response supplemental examiner’s answer to § 41.39(b) to respond to a new ground of to a new ground of rejection in respond to a new issue raised in a reply rejection in an examiner’s answer give accordance with § 41.39(b)(2) has to brief could be construed as to permit a the appellant the choice of maintaining address only the new ground of supplemental answer in almost any case the appeal or reopening prosecution rejection or all remaining grounds of and lead to a repeated exchange before the primary examiner. Moreover, rejection including those covered in the between the examiner and the appellant if prosecution is reopened, it is original appeal brief. The comment also that would not promote a just, speedy, reasonable to require that any states that it is not clear what is or inexpensive resolution of the amendment and/or evidence be intended by the requirement that the proceeding. One comment notes that responsive to the new ground of appeal brief should follow the other there may be rare circumstances when rejection. Any such responsive requirements of a brief as set forth in such a supplemental examiner’s answer amendment and/or evidence may also § 41.37(c). is appropriate. That comment suggests be directed to claims not subject to the Answer: A reply brief filed in that the number of supplemental new ground of rejection. Furthermore, it response to a new ground of rejection in examiner’s answers be limited to one is noted that the appellant can file a accordance with § 41.39(b)(2) only has unless personally approved by the request for continued prosecution to address the new ground of rejection. Commissioner for Patents or one of his pursuant to § 1.114 and then the In such an instance, the reply brief deputies. appellant would be able to submit an should include the following items, Answer: The suggestion is adopted to amendment and/or evidence directed with each item starting on a separate the extent that the MPEP will provide only to claims unrelated to the new page, so as to follow the other that each supplemental examiner’s ground of rejection and have such requirements of a brief as set forth in answer must be approved by a considered by the examiner. Therefore, § 41.37(c): Technology Center Director or designee. the appellant does have a full range of (1) Identification page setting forth the Comment 75: One comment suggests prosecution options. applicant’s name(s), the application that the comments made in the Comment 70: Several comments number, the filing date of the background discussion of proposed suggest that although there may be application, the title of the invention, § 41.43(a)(1) be changed to remove any circumstances where the introduction of the name of the examiner, the art unit prohibition on the right by the appellant a new ground of rejection is desirable, of the examiner and the title of the to file a reply brief. The comment states the situations where such new ground is paper (i.e., Reply Brief) that appellants should have the right to introduced should be infrequent. (2) Status of claims page(s) file a reply brief in any situation. The Answer: As noted in the proposed (3) Grounds of rejection to be comment notes that the Office had an rule making, the change to permit new reviewed on appeal page(s) earlier procedure that specified grounds of rejection in the examiner’s (4) Argument page(s) situations in which reply briefs could be
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filed and that this resulted in disputes presentations are not cut and dried like has become convinced, prior to hearing, and petition filings, where the examiner many written briefs. that the examiner’s position will be and the appellant disagreed as to Answer: The comment will not be reversed or the proceeding needs to be whether the filing of a reply brief was adopted. While oral and written remanded, there is no reason to provide permissible. The comment observes that presentations do differ in many the appellant with an opportunity to the now-superseded rules no longer respects, an appeal decided on the briefs nevertheless hold an oral hearing. The prohibited the filing of a reply brief and without an oral hearing does receive the Manual of Patent Examining Procedure suggests that this practice should same consideration by the Board as will provide examples as to when it continue and that appellants should appeals decided after an oral hearing. would be appropriate for the Board to always be permitted to have the last Comment 77: Four comments state decide that an oral hearing is not word. that the proposed requirement of necessary. Currently, those examples Answer: Former § 1.193(b) (2003) § 41.47(e) that at the oral hearing, the include those where the Board has provided that an appellant may file a appellant may only rely on evidence become convinced, prior to hearing, that reply brief to an examiner’s answer or that has been previously entered and an application must be remanded for a supplemental examiner’s answer considered by the primary examiner and further consideration prior to evaluating within two months from the date of present argument that has been relied the merits of the appeal or that the such examiner’s answer or upon in the brief or reply brief was too examiner’s position cannot be sustained supplemental examiner’s answer. rigid. Most of the comments believe that in any event. Section 41.41(a)(1) provides that an an appellant should be able to make an Comment 79: Three comments note appellant may file a reply brief to an argument not present in the briefs if that § 41.50(a)(2) did not set any time examiner’s answer within two months good cause is shown such as new law limit for taking action to respond to a or facts. One comment submits that from the date of the examiner’s answer supplemental examiner’s answer demonstrative exhibits should not be and § 41.43(b) provides that if a written in response to a remand by the precluded by this requirement. Board for further consideration of a supplemental examiner’s answer is Answer: Section 41.47(e) has been furnished by the examiner the appellant rejection. amended to permit the appellant and/or Answer: The comment has been may file another reply brief under the primary examiner, upon a showing adopted. Section 41.50(a)(2) has been § 41.41 to any supplemental examiner’s of good cause, to rely on a new amended to provide a two-month period answer within two months from the argument based upon a recent relevant for response. date of the supplemental examiner’s decision of either the Board or a Federal Comment 80: One comment requests answer. Thus, the rules continue to Court. In addition, a demonstrative that each action and decision of the permit the appellant to always have the exhibit (e.g., a sample of the invention Board should explicitly set forth the last word. That is, the appellant may as shown in the application’s drawings) options, time limits, and extension of always file a reply brief to an examiner’s solely directed to information of record time practice available for taking further answer or a supplemental examiner’s that is not being relied upon to establish action. answer within two months from the patentability is not precluded by this Answer: The Board will consider date of such examiner’s answer or rule. including options, time limits, and supplemental examiner’s answer. The Comment 78: One comment states extension of time practice in its background discussion of proposed that there does not appear to be any decision. § 41.43(a)(1) noted that an indication of limitation on the authority to cancel Comment 81: Two comments inquire a change in status of claims (e.g., that requested Oral Hearings as set forth in as to the justification for dismissal of an certain rejections have been withdrawn proposed § 41.47(f). The comment notes appeal of all claims (proposed as a result of a reply brief) is not a that the commentary to the proposed §§ 41.50(a)(2) and 41.50(d)) rather than supplemental examiner’s answer and rule indicates that the rule would be those that may be subject to a new therefore would not give the appellant applied where a remand to the rejection as in proposed § 41.39(b). One the right to file a reply brief. This is not Examiner is necessary or where the comment urged that in the absence of a a change from current practice where an Examiner’s position could not be compelling reason to treat these examiner is permitted to respond to a sustained. The comment suggests that situations in a different manner that the reply brief by indicating a change in the rule could be clarified by adding, for Office adopt the practice that results in status of claims (e.g., that certain example, ‘‘in order to remand to the the dismissal of the appeal only as to rejections have been withdrawn as a Examiner or to grant the requested the claims affected by the Office action. result of a reply brief) on form PTOL– relief’’ after ‘‘if the Board decides that a The other comment urged with respect 90. This indication of a change of status hearing is not necessary’’ but before the to § 41.50(d) that the dismissal penalty is not a supplemental examiner’s comma. Another comment suggests that for non-response be removed and that answer and therefore the appellant has § 41.47(f) be amended after ‘‘notify the Board be permitted to make any no right to file a further reply brief. appellant’’ to state ‘‘and provide the appropriate presumptions in view of the Comment 76: One comment suggests appellant an opportunity to indicate non-response. that the second sentence (An appeal whether or not to hold an oral hearing’’ Answer: We will adopt the suggestion decided on the briefs without an oral to make it clear that a party is entitled to the following extent. Section hearing will receive the same to an oral hearing if the party notifies 41.50(a)(2) has been amended to provide consideration by the Board as appeals the Board timely and pays the fee for an that if a supplemental examiner’s decided after an oral hearing) of oral hearing. answer is written in response to a § 41.47(a) be deleted. The comment Answer: The suggestions will not be remand by the Board for further believes that the statement that an adopted. The substance of § 41.47(f) is consideration of a rejection pursuant to appeal without an oral hearing will be found in former § 1.194 (2003) and § 41.50(a)(1), the appellant must decided the same way as an appeal with therefore no substantive change was exercise one of two options to avoid sua an oral hearing denies the fact oral and proposed. Moreover, in a situation sponte dismissal of the appeal as to the written presentations differ in many where the Board has decided that no claims subject to the rejection for which respects and the fact that oral hearing is necessary because the Board the Board has remanded the proceeding.
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Section 41.50(d) has not been amended best course of action in deciding a Comment 83: Two comments state since it provides that failure to timely rejection is to either (1) remand to the that the proposed requirement of comply with an order of the Board may examiner for further consideration of § 41.52(a) that in a request for rehearing result in the sua sponte dismissal of the the rejection; (2) order the appellant to the appellant may only rely on evidence appeal. Thus, the Board may take the brief additionally a matter concerning that has been previously entered and action that is appropriate under the facts the rejection; (3) reverse or vacate the considered by the primary examiner and of each proceeding. rejection (with or without a remand to present argument that has been relied Comment 82: One comment notes that the examiner for further action); or (4) upon in the brief or reply brief was too proposed §§ 41.35(c) and 41.50(a)(1) affirm the rejection. While the examples rigid. The comments believe that an provide for remand of an application to of situations where the Board may appellant should be able to make an the examiner. The comment urges the remand an appeal to the examiner made argument not present in the briefs if Board to exercise the remand authority in the background discussion of good cause is shown such as new law in a manner that takes into appropriate proposed § 41.50(a)(2) could also be or facts. account the possible patent term examples of situations where the Board Answer: Section 41.52(a) has been extension/adjustment consequences of a may reverse the rejection, the Office amended to permit the appellant, upon remand that is tantamount to a reversal believes that appellants’ rights are a showing of good cause, to rely on a of the rejections of at least one claim in new argument based upon a recent an appeal. In taking actions to dispose protected in such a situation since appellants under the provisions of relevant decision of either the Board or of appeals, the comment states that the a Federal Court. Board needs to be aware of and take into § 41.50(a)(2) can choose to respond to appropriate account the possible any supplemental examiner’s answer Part 41, Subpart C—Inter Partes implications of its actions on eligibility written in response to a remand by the Appeals Board for further consideration of a for patent term extension/adjustment Comment 84: One comment points and seek to avoid taking action that rejection by either (1) requesting that prosecution be reopened before the out that the recitation in proposed would possibly deny some applicants § 41.66(a) that, ‘‘if any party to the potentially very valuable rights under examiner by filing a reply under § 1.111 of this title with or without amendment proceeding is entitled to file an appeal 35 U.S.C. 154(b). As one example, the or cross appeal but fails to timely do comment asserts that the Board should or submission of affidavits (§§ 1.130, 1.131 or 1.132 of this title) or other so,’’ appellants brief will be due upon not remand an appeal to the examiner ‘‘the expiration of time for filing (by the when the examiner has failed to evidence; or (2) requesting that the last party entitled to do so) such notice establish a prima facie case of appeal be maintained by filing a reply of appeal or cross appeal’’ is confusing. unpatentability, but instead the Board brief as provided in § 41.41. The panel The comment points out that it is not should reverse the rejection(s) and of Administrative Patent Judges clear how an appellant A can know permit the examiner to take appropriate deciding the appeal will determine if whether another party B will file a action when the file is returned to the and when a remand is appropriate. A notice of appeal or cross appeal on the jurisdiction of the examining group. final decision on appeal can only be last day of the time period for filing Another comment suggests that the reached when the record is susceptible same. If such a notice of appeal is then examples of situations where the Board to meaningful review. A significant filed by party B, party A’s appellant may remand an appeal to the examiner number of remands result from cases made in the background discussion of brief would be due two months from the that have been assigned to a merits date the notice of appeal is filed by proposed § 41.50(a)(2) be deleted and panel for final decision where the that the Board in fact discontinue the party B, whereas if party B does not file record is unclear. For example, it has it, party A’s appellant brief would be practice covered by the examples. The been the Board’s experience that cases comment states that the Board is an due by party A’s ‘‘original’’ last day for in which amendments and additional filing the appellant brief. impartial panel resolving disputes evidence have been filed during the between appellants and examiners and Answer: The comment has been appeal process including with the Reply adopted. The comment suggests that the that no special consideration should be Brief oftentimes have a confusing given by the Board to an examiner’s rule, as proposed, was open to more record. Sometimes the record does not position. The comment states that the than one interpretation, because it can indicate that the examiner considered examiner must establish a prima facie be read to suggest that the brief is due the amendment and/or additional case of anticipation or obviousness, upon ‘‘the expiration of time for filing which the appellant must persuasively evidence or the record indicates that the (by the last party entitled to do so) such demonstrate to be in error. The amendment and/or additional evidence notice of appeal or cross appeal.’’ While comment asserts that just as the Board has been ‘‘entered’’ by the examiner a fair reading of the rule as proposed would not give the appellant an without comment. Such cases need to would be that the brief must be filed opportunity to present a more be remanded/returned to the examiner within two months from the latest filing persuasive traversal, the Board should to clarify the record as to the status of of the last-filed notice of appeal or cross not give an opportunity to the examiner the amendment and/or additional appeal, or within two months from the to more clearly meet his or her burden. evidence and if the material is entered expiration of time for filing such notice The comment expresses the view that if have the examiner enter a substantive of appeal or cross-appeal, the a prima facie case of unpatentability response. It may be that upon remand comment’s interpretation is also tenable. was not adequately made by the the examiner will determine upon a Accordingly, in the interest of clarity examiner, the rejection should be clarified record that the claims are the rule has been amended to more reversed. patentable and pass the case to issue. It clearly state that the brief is due within Answer: The comments are not is expected that the proposed limits on two months from the latest filed notice adopted. It is within the discretion of the presentation of amendments and/or of appeal or cross appeal or within two the panel of the Board deciding the evidence after the notice of appeal (see months from the expiration of the time appeal to determine the best course of § 41.33) has been filed will minimize for filing a notice of appeal or cross action. A panel may conclude that the such occurrences. appeal, whichever is later.
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Comment 85: One comment suggests Answer: Subpart D is designed to such conditions as the administrative that § 41.68(a)(4) be amended by adding address all contested proceedings that patent judge may impose. Both the word ‘‘other’’ to indicate that ‘‘[a] currently occur before the Board, comments fear that the rule will permit requester’s respondent brief may not including title proceedings under 42 arbitrariness. address any brief of any other U.S.C. 2182(4) and 2457(d). Title Answer: The rule does not authorize requester.’’ The comment states that the proceedings constitute a very small arbitrariness, which if it were to occur requester should be able to refer to any percentage of the overall number of would be subject to correction. See arguments made in a previously filed contested cases (about 1%). If a need § 41.125(c)(5). Moreover, the rule brief by that same requester. arises for special rules specific to the reflects current practice under the Answer: The comment has been title cases, they would most likely be Standing Order at ¶ 21, under which an adopted. The last sentence of former placed in a new subpart, just as subpart administrative patent judge may modify § 1.967(a) (2003) provided that ‘‘a third E addresses specific issues arising in the Standing Order. The present rules party respondent brief may not address patent interferences. incorporate many portions of the any brief of any other third party.’’ This Comment 88: One comment suggests Standing Order and, consequently, prohibition was to prevent multiple that § 41.102(a) is confusing since it incorporate the provision of the requesters from addressing the briefs of suggests that examination must be Standing Order that permits their other requesters which would make the complete before a contested case will be modification. proceeding unmanageable. Former initiated, but that the declaration of an There is a tension between adding so § 1.967 (2003) contained no prohibition interference means that the question of much detail in the rules that they preventing a requester from referring to priority has yet to be resolved. The become too constrictive and including its own previously filed brief. The word comment urges that the phrase so little that parties lack guidance about ‘‘other’’ was inadvertently omitted from ‘‘interfering subject matter * * * which what is required. Section 41.104(b) is the proposed § 41.68. Accordingly, the is patentable to the applicant subject to intended to strike a balance by letting comment is adopted and the word a judgment in an interference’’ from the rules include more detail, and thus ‘‘other’’ has been inserted in the rule as § 1.607(b) (2003) be included in provide a basis for counseling clients, suggested. § 41.102(a). but also provide a remedy for when a Comment 86: One comment suggests Answer: Section 41.102(a) has been rule does not facilitate the goal of an that paragraphs (b) and (c) of § 41.69 be amended to include similar language to inexpensive, fast, and fair proceeding. eliminated from the rule. The comment that suggested, but it has been See § 41.1(b). The responses that the urges that the examiner should not be generalized since subpart D is not Board has received regarding increased required to reopen prosecution if he or limited to interferences. For instance, flexibility in interferences have been she is persuaded by the brief filed that patentability might not be an issue in a generally good. Rather than eliminate a rejected claim is in fact patentable or title proceeding under 42 U.S.C. 2182(4) the flexibility provided in § 41.104, lest that a claim found patentable is in fact and 2457(d). it be abused, it is better to address any unpatentable. The comment further Comment 89: Two comments express abuse as it arises. No comment objected suggests that proposed § 41.69(d) should concern that the filing of a to § 41.104(c), which provides similar be amended to require that ‘‘any reexamination could delay the initiation flexibility for the setting of times. proposed new ground of rejection, or of a contested case. Comment 92: One comment discusses any proposed new determination not to Answer: A simultaneously pending an instance under the previous rules in make a proposed rejection, shall be reexamination and interference which, the comment suggests, a waiver stated by the examiner in a separate involving the same patent has been very occurred that was not fair. section of the examiner’s Answer, and rare. Section 41.102 provides the Board Answer: Too few details were shall include reasons why the examiner with the flexibility to tailor a specific provided to make discussion of the has been persuaded to propose such solution to such occurrences as they example feasible. However, if a waiver new ground of rejection or new arise. See also § 1.565(e) and § 1.993. is arbitrary or unfair, the injured party determination not to make a proposed The requirement under 35 U.S.C. 305 has a remedy before the Board, rejection, referring to the corresponding and 314(c) for special dispatch in § 41.125(c)(5), and during subsequent arguments in the requester’s or owner’s reexaminations will inform any solution judicial review. It is up to the party to briefs.’’ that the Board may craft. preserve the issue and to pursue its Answer: The comment has not been Comment 90: Section 41.103 remedies. adopted. Section 41.69 was proposed to suspends action in any case involved in Comment 93: One comment is generally incorporate the requirements a contested case before the Board except concerned that such waivers could of former § 1.969 (2003) which relate to as the Board may order. Two comments change the substantive requirements for the examiner’s Answer. The rule making request that § 41.103 be modified to motions. did not propose to change the current require the Board to provide notice of Answer: The Board has cautioned practice set forth in paragraphs (b) and when the suspension is lifted. against confusing procedural (c) of § 41.69 and paragraphs (b) and (c) Answer: The judgment in the involved requirements for motions set in the rules of former § 1.969 (2003). The comment case will constitute adequate notice that with the substantive requirements of the has been forwarded to the Deputy the suspension is no longer in effect. patent statutes and case law necessary Commissioner for Patent Examination Moreover, the suspension only applies to prevail in a motion. Hillman v. Policy for further consideration. to involved files, not to ancillary files Shyamala, 55 USPQ2d 1220, 1221 like benefit files, which may still be (BPAI 2000). Moreover, only the general Part 41, Subpart D—Contested Cases pending. A response to any outstanding contested case rules in subpart D are Comment 87: One comment suggests Office action in an ancillary file should subject to a § 41.104(b) waiver. The that subpart D be modified to take title be timely filed to avoid abandonment. presumptions and showings required in proceedings under 42 U.S.C. 2182(4) Comment 91: Two comments oppose subpart E are outside the scope of and 2457(d) into consideration. The § 41.104(b), which allows an § 41.104(b). comment does not suggest specific administrative patent judge to waive or Comment 94: One comment urges that modification. suspend a rule in subpart D subject to a waiver provision in the rules is
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contrary to administrative law, citing The comment suggests that the Board associated with filing in paper. Once an United States v. Nixon, 418 U.S. 683, provide these formalities on its own. electronic filing system for contested 686 (1974). Answer: These requirements were cases has been developed, it is expected Answer: The cited page has no bearing introduced to facilitate interference that a rule will be proposed to address on waiver of rules. The case read as a paper handling within the Board. the separate requirements for such whole supports the rule. At page 696, Experience over the past five years, filings. the Court explained that the Attorney since these requirements were Comment 102: Two comments call for General must comply with his own rule introduced, show a vast improvement § 41.106(d) to address hand filing precisely because he had not reserved over past practice. All of that expressly. One of the comments the power to act otherwise without improvement would be lost if the requests adoption of the current practice changing the rule. In § 41.104(b), the comment were adopted. As the permitting hand filing at the Board by rule specifically authorizes the Board to supplementary information explained, 10 a.m. the next business day after the change a rule within subpart D. The rule these formalities are based on the due date. The other comment is consistent with statute as well since practices of courts that regularly review recommends addressing hand filing a procedural requirement can be Board decisions. with the Office mail room and overnight changed without notice and comment These requirements do not apply to delivery services. rule making. 5 U.S.C. 553. interferences in the electronic filing Answer: Section 41.106(d)(2) has been Comment 95: One comment urges pilot program and would not likely amended to list hand filing expressly modification of § 41.106(a)(1), which apply in any permanent electronic filing along with electronic filing as a filing requires all papers from a party to be the system. The Office expects to develop mode that the Board may authorize by same size absent some compelling an electronic filing system for contested order. Hand filing with the Office mail reason for a larger paper size. The cases over the next several years. In the room is not equivalent to hand filing comment suggests saying ‘‘different’’ meantime, participation in the pilot with the Board since even subtle rather than ‘‘larger’’. program will permit a party to avoid mistakes in the way the paper is Answer: Larger in this context means these two formalities. addressed can result in its being Comment 99: One comment opposes larger in any dimension that prevents misdirected within the Office for long the prohibition in § 41.106(b)(3) on reproduction without loss of detail. A periods of time. incorporation by reference from other As a matter of policy, the Office has smaller exhibit can be reproduced on papers and on combined papers. accepted the EXPRESS MAIL service standard (A4 or 81⁄2 x 11″) paper Answer: Incorporation by reference of the United States Postal Service as without loss of detail. Indeed, it may and combination of papers are short- equivalent to hand filing with the sometimes be advisable to enlarge a sighted remedies for a party. While they Office. A properly addressed EXPRESS small exhibit to take advantage of the may reduce the length of a paper, they MAIL filing is also likely to arrive additional space. Many larger exhibits do so at the cost of obscuring the flow promptly. Use of overnight delivery can be effectively reduced to a standard of the party’s argument and often result services and other forms of hand paper size without loss of detail. The in disjointed presentations lacking delivery to the Board will continue to be rule recognizes, however, that many sufficient connecting explanation. treated by order. Although the current exhibits will not be readily reduced to Frustrating and confusing the decision- practice of hand filing at the Board is a standard paper size. Consequently, the maker is never a wise strategy. The rule popular, uncertainties regarding rule provides parties with the flexibility prohibits a practice that parties would security and access to the new Board to use a larger paper size when it is truly be well-advised to avoid in any case. facilities in Alexandria, Virginia, necessary. Comment 100: One comment urges counsel against codifying this practice Comment 96: Section 41.106(a)(2)(ii) that a rule is not the appropriate place at this time despite its present success. requires papers to be double-spaced for § 41.106(b) formalities because a Comment 103: One comment suggests except for headings, signature blocks petition would be required for relief. clarifying § 41.106(e)(3) to state that and certificates of service. One comment Answer: The formal requirements in overnight delivery is required as the suggests that tables of contents should § 41.106(b) had previously been alternative to EXPRESS MAIL. be added to the list of exceptions. promulgated through the Standing Answer: Other forms of prompt Answer: Section 41.106(a)(2)(ii) has Order. Whether in the Standing Order or delivery might also be appropriate, been modified to include tables of in a rule in subpart D, the remedy including facsimile service or electronic contents, tables of authorities, and would be the same: A miscellaneous service (with Board authorization). The indices. motion (§ 41.121(a)(3)) for relief from purpose of the rule is to provide parties Comment 97: A second comment the requirement rather than a petition. with some latitude in meeting the suggests additional formatting Note that under § 41.104(a) waiver of a service requirement, while still requirements, particularly a page limit rule in subpart D can be granted on a requiring promptness. In any case, a or word count along the lines of Federal motion. The reason for placing these party whose mode of service takes much Rule of Appellate Procedure 32(a)(7). requirements in the rule is to reflect the more than a day may find its options Answer: The suggestion is outside the fact that they are presently required for limited by order. scope of what was proposed, but may be nearly every paper in every case. Comment 104: Four comments addressed in a pilot program or in a Comment 101: One comment seeks request clarification of § 41.106(e)(4) future rule making. For instance, in the clarification of whether the extra copy about whether the date to be excluded electronic filing pilot program for required under § 41.106(c) applies to from calculating response periods is the interferences, word counts might be papers filed electronically. date of service or the date that service permitted as an incentive to parties to Answer: Electronic filing is currently is received. file text-searchable papers. a pilot program and is administered Answer: The rule has been amended Comment 98: One comment opposes under an additional order that waives to ‘‘The date of service’’ to be consistent the requirement in § 41.106(b)(1)(ii) and the extra copy requirement. As noted with § 41.123 and § 41.155. (b)(2) for a distinctive cover sheet and above, electronic filing will likely Comment 105: Section 41.106(f)(3)(i) two-hole punched paper, respectively. eliminate many of the formalities now requires a certificate of service to name
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each paper served. The comments applicant to put on its entire priority application or patent in case a party suggest that the use of ‘‘each’’ is case. It only need put on enough of a subsequently moves to add, or designate confusing since the paper named is the case to show priority assuming the as corresponding to a count, one or same paper that incorporates the opposing party puts on no case at all. more uninvolved claims. certificate of service under Often this will be much less than the Answer: The present rule strikes a § 41.106(f)(1). applicant could or ultimately will balance between having a clear Answer: The proposed rule referred to prove. For instance, if the applicant has statement of the claims and imposing exhibits, which can be served as a a filing date of August 15, while the costs on parties by making a party group. To address the concern raised by patentee’s application was filed on responsible for its own involved claims. the comments, § 41.106(f)(3)(i)–(iii) have August 7 with an inventor’s declaration A clean copy of any claim to be added been reordered to place paragraph (i) dated August 5, then a proof of should be included with any motion to last. Moreover, the paragraph in conception before August 5 and add the claim, § 41.110(c). Imposing the question has been revised to say ‘‘for diligence from at least August 4 will additional cost of providing clean exhibits filed as a group, the name and generally suffice. copies for uninvolved claims against the number of each exhibit served.’’ In any case, starting later this year, possibility that one might be added Comment 106: One comment suggests these papers will be available over the would typically be an unnecessary that § 41.108, which addresses internet in published applications with added expense. Nothing in the rule bars identification of counsel, include a an image file wrapper. Soon it will not a party from filing a clean copy of reference to registered patent agents make sense to try to withhold a § 1.131 uninvolved claims as well if doing so who are not attorneys. declaration or a § 41.202(d) showing in would be easier for the party filing the Answer: Section 41.108 uses most cases because it will have already clean copy. ‘‘counsel’’ to be consistent with § 41.5. been publicly available. Comment 110: One comment urges Both rules are intended to include, not There may be some instances when that annotated claims should not be exclude, registered patent practitioners the paper has not been made public and required until preliminary motions, and any person recognized to act pro an applicant could show undue oppositions, and replies have been filed. hac vice. prejudice if the paper were made A second comment suggests that Comment 107: Section 41.109(a) does available to its opponent. Such cases are annotated claims not be required until not retain the practice of § 1.612(a) best left to case-by-case development. after preliminary motions have been (2003) of withholding access to § 1.131 An applicant may promptly move decided. Four comments express and § 1.608 (2003) (now § 41.202(d)) (§ 41.121(a)(3)) as soon as the concern about the potential estoppel declarations in involved applications. interference is declared to have its effect of filing annotated claims. Three comments request that the § 41.202 showing withheld. If the Board Answer: Notice is a core function of practice be restored. Two of the grants a motion to withhold a a patent claim. In re Morris, 127 F.3d comments suggest that the practice be § 41.202(d) showing, it will advise the 1048, 1054, 44 USPQ2d 1023, 1028 restored for all unpublished Office of Public Records, which may (Fed. Cir. 1997). An applicant has wide applications, or equivalently that pre-29 then remove the showing from the file latitude to claim its invention as it sees November 2000 applications be after it has been printed. fit, but the vital notice function of grandfathered out of the rule. One Comment 108: One comment suggests claims imposes a corresponding duty to comment suggests that the practice be that § 41.109(a) permit the requesting of claim clearly and distinctly. Id., 127 restored for § 41.202(d) showings certified copies. According to the F.3d at 1056, 44 USPQ2d at 1029. An because, unlike § 1.131 declarations, comment, the Office of Public Records attempt to avoid prosecution estoppel is they relate directly to the junior party’s currently fills requests for certified never a valid reason for an applicant to priority case without otherwise copies in interferences by sending evade a clear indication of what its reflecting on patentability and thus, uncertified copies, which the comment claim means. Id., 127 F.3d at 1056, 44 according to the comment, only serve to asserts are more likely to have missing USPQ2d at 1030. The suggestion that a expose the junior party’s priority case. pages. party should not be accountable for the Answer: Part of the original intent of Answer: Nothing in § 41.109(a) meaning of its claims is utterly the rule change was to balance the prevents a party from requesting a inconsistent with the purpose and playing field between applicants and certified copy. The rest of the comment sound functioning of the patent system. patentees since any § 1.131 or § 1.608 is directed to operation of the Office of Claim annotation is vital to the (2003) declaration in a patent would be Public Records, a matter outside the efficient administration of contested publicly available. In many cases, the scope of this rule making, and would cases because it provides the Board and junior party is a patentee so no showing not be solved by changing the rule as opposing parties with a starting point will have been filed or it will already be requested. Instead, the comment has for understanding how the party intends publicly available. Moreover, while the been referred to the Office of Public its claim to be read. It also serves as a declarations were removed under Records. stimulus for the parties to take a close § 1.612(a) (2003), other papers that The image file wrapper, which is now look at their claims to see if there are discussed the declarations were not, so the official record of the application latent problems that need to be the protection offered under the rule within the Office, should be much less addressed before motions are filed. was not very extensive. prone to copying mistakes. The Board expects the claim The difference suggested in one Consequently, if pages appear to be annotation to be complete and accurate. comment between declarations under missing, the absence of those pages As a practical matter, the Board has § 1.131 and § 1.608 (2003) is not so great accurately reflects the official contents permitted parties to point out additional since in both cases the Office will have of the file. support consistent with their claim relied on the declaration to reach the Comment 109: Section 41.110(a) annotation. In the event that a party conclusion that all patentability issues requires each party to file a clean copy makes a mistake, it can seek correction in the application other than priority of its involved claims. One comment through a miscellaneous motion have been resolved. The showing under suggests that the requirement include (§ 41.121(a)(3)). Parties moving to § 41.202(d) does not require the uninvolved claims in the involved correct, and parties opposing such
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motions, should note that prejudice to noted that a preliminary statement was interference. A second comment the opposing party will be an important not evidence for a party, but left open applauds the removal of the prohibition element in deciding whether to grant the possibility that a party would be on simultaneous filing of preliminary relief. estopped from denying an allegation in and priority motions. Comment 111: One comment opposes its preliminary statement. Preliminary Answer: The rule does not require a what it contends is a requirement to statements have been routinely used as change in current practice and submit annotated claims more than admissions, for instance in the context ordinarily will not result in once. of an order to show cause under simultaneous filing of such motions. Answer: The rule does not require § 1.640(d)(3) (2003). A comparable The Board will continue to set the times more than one annotation for each practice has existed with regard to for filing motions (§ 41.123(a)), claim. No additional annotations are § 1.608 (2003) declarations and including setting different times for required unless a claim is added or summary judgment under § 1.617 different motions. amended (§ 41.110(c)(3)). If a claim is (2003). Preliminary motions—those affecting added or amended, it is a new claim and Section 41.120(b) does not change the threshold issues, count scope, and requires annotation. Note that the requirements for finding an admission, benefit—will generally precede any requirement could be waived at a but simply places a party on notice that priority motion since a decision on such conference call discussing the motion; its statements could be used as an motions will affect the scope and for instance, a minor grammatical admission. complexity of any priority case that amendment to a claim that has Comment 115: One comment cites must be presented. The main effect of otherwise been properly annotated cases for the proposition that the the rule is to have the priority case might not require a new annotation. standard for finding an admission is presented as a motion whenever it is Comment 112: Three comments high. Harner v. Barron, 215 USPQ 743 filed. The Board will have the authority suggest that the phrase ‘‘add a reissue (Comm’r Pats. 1981); Flehmig v. Giesa, to advance consideration of priority claim’’ in § 41.110(c) is either a mistake 13 USPQ2d 1052 (BPAI 1989); Suh v. issues in an appropriate case, but such or too narrow. Hoefle, 23 USPQ2d 1321 (BPAI 1991); cases are expected to be exceptional. Answer: Section 41.110(c) is amended Issidorides v. Ley, 4 USPQ2d 1854 Comment 118: One comment views to delete the word reissue. The intent of (BPAI 1985); Ex parte McGaughey, 6 § 41.121(a)(1) as unduly circumscribing the rule is to require a clean copy, a USPQ2d 1334 (BPAI 1988). The the Board’s authority under 35 U.S.C. claim chart showing written comment does not, however, point to 135(a) to reach patentability questions description, and an annotated copy the parts of the cases that the comment in an interference. The comment (when applicable) of any added claim, considers to be inconsistent with the suggests that a ‘‘when justice requires’’ including added claims in a reissue rule. test for reaching extrinsic patentability application. Answer: The cases provide examples issues would be desirable. Comment 113: One comment urges where Board panels, or in one case a Answer: The rule does not limit the that the requirements of § 41.120(a), Commissioner reviewing the action of a Board’s authority to address regarding the notice of bases for relief, Board employee, found a lack of an patentability questions as long as they is too vague, particularly given the admission of the facts of the particular relate to a change in the scope of the consequences that attend such notices case. None creates a bar against finding interference or to a change in the in § 41.120(b) and (c). The comment admissions. The only effect that accorded benefit, or are otherwise likely suggests that the current motions list § 41.120(b) might have on these to lead to judgment in the case. It does practice be adopted instead. precedents is that, by placing the party not seem likely that justice would Answer: Section 41.120 authorizes the explicitly on notice that its statements require the Board to address a Board to require a notice outlining how might be treated as an admission, it patentability issue that cannot otherwise a party intends to litigate a contested might make the showing of an be plausibly related to the issues in the case. Since the type of notice will vary admission somewhat easier. contested case. If a patentability issue with the type of case, greater detail in Comment 116: One comment urges arises that cannot be reached under the rule is not possible. Moreover, the that the standard for correcting a notice § 41.121, but should be reached in the notice is not automatically required of basis for relief in § 41.120(c) is like interest of justice and is otherwise except in the case of a priority statement the standard for correcting a preliminary within the scope of the Board’s under 41.204(a). Hence, when the Board statement, and thus too strict for authority, a party could seek relief requires such notice, it will also specify correcting motions lists. under § 41.104 by filing a miscellaneous what must be shown. Answer: Under § 41.204(a), the motion (§ 41.121(a)(3)). Comment 114: One comment opposes priority statement is a kind of notice of Comment 119: One comment suggests § 41.120(b), which requires a party filing basis for relief, so the preliminary that § 41.121(a)(2) be amended to a notice of basis for relief to file only statement correction practice is remove the authority to cancel a claim. motions consistent with the notice. The appropriate in such cases. In other cases The comment suggests that comment considers the rule to be a trap where the Board has required such § 41.121(a)(2) is unfair because a for the unwary and particularly objects notice and specified what must be patentee cannot cancel a claim. The to the word ‘‘ambiguities’’, which may shown, the strict interests-of-justice comment indicates that the option of be construed against a party. standard is also appropriate because the canceling a claim might be Answer: Under existing practice for party has actual notice that it will be misunderstood by a party as being preliminary statements, which are the strictly bound. The rule does not without cost. closest present analog of the notices prevent the Board from requiring other Answer: A patentee can disclaim a under § 41.120, a party would be strictly notices that are easier to correct. claim under 35 U.S.C. 253. held to its alleged dates with ‘‘[d]oubts Comment 117: One comment opposes Authorization to cancel a claim does as to definiteness or sufficiency of any § 41.121(a) because it views not mean that no consequence would allegation * * * resolved against the simultaneous filing of preliminary attach to the cancellation. For instance, party filing the statement’’, § 1.629(a) motions and priority motions as onerous cancellation of all involved claims (2003). Similarly, § 1.629(e) (2003) and as unfair to the target of a provoked would result in judgment against the
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canceling party (§ 41.127(b)(2)). material fact be stated in a single provide context and meaning to the Cancellation of a claim in response to a sentence. relevant facts. A party that simply cites motion attacking the claim would be a Answer: Material facts should be to facts without explaining them is concession of the issue with respect to stated in a manner that permits the effectively recruiting the opposing party that claim and would create an estoppel opposing party to admit or deny the fact and the Board to make out its case. The (§ 41.127(a)), just as amending a claim readily. Multi-sentence facts place a burden for explaining what the evidence can create an estoppel. Section burden on the opposing party to parse means and how it justifies the relief 41.121(a)(2) is amended to remove claim the stated fact for portions that can be sought in the paper remains with the cancelling as an express option to avoid admitted or denied. The result is a party filing the paper. its being requested too casually, complex tangle that does not facilitate Comment 125: Section 41.121(c)(2) although cancellation and disclaiming decision-making. Even long, compound requires compliance with any rule in 37 remain options under the ‘‘otherwise sentences are abusive. Section CFR part 1 that would ordinarily govern cure a defect’’ provision of 41.121(c)(1)(ii) has been amended to the relief sought if it were sought § 41.121(a)(2). require a statement of facts. outside the context of a contested case Comment 120: Three comments Section 41.121(d) has been within the Board’s jurisdiction. One suggest that a preponderance of the renumbered as § 41.121(f) and a new comment suggests requiring that a party evidence standard be added to § 41.121(d) has been inserted to address moving to add a reissue claim also file § 41.121(b). the form and content of the statement of a reissue declaration or supplemental Answer: Not all issues arising by material facts. A single-sentence reissue declaration addressing the motion are subject to a preponderance requirement for material facts is added claim. of the evidence standard. For instance, at § 41.121(d)(1). Answer: One problem with the a junior party that filed its application Comment 123: One comment suggests suggestion is that the movant might not after a patent issued to the senior party an amendment to § 41.121(c)(1)(iii) to be the reissue applicant. Rules cannot would have to prove priority under the limit what it sees as the open-ended address every possible contingency. A clear and convincing evidence standard obligation of a party adding a claim in party that believes it is harmed by the (§ 41.207(a)(2)). The default evidentiary a contested case to address every opponent’s inadequate reissue standard in civil proceedings is the rejection that could conceivably be declaration can address the problem in preponderance of the evidence made based on the prosecution history. its opposition or can move for relief in standard. Price v. Symsek, 988 F.2d Answer: No such unlimited obligation a miscellaneous motion (§ 41.121(a)(3)) 1187, 1193, 26 USPQ2d 1031, 1035 exists. Generally, the obligation to prior to filing its opposition. (Fed. Cir. 1993). Codifying the default ‘‘prove patentability’’ has been limited Comment 126: Section 41.121(c)(4) standard, would require the rules to list to showing compliance with the written provides that any material fact not every exception. Consequently, the description requirement of 35 U.S.C. denied will be considered admitted. suggestion is more likely to cause 112(1) except where the party One comment suggests that a fact only confusion than to resolve it. reasonably has actual notice that other be considered admitted if it is not Comment 121: One comment notes patentability problems exist. Typically, denied and it is ‘‘placed in issue by the the elimination from § 41.121(c) of such notice is provided by a prior parties or the Board’’. precise directions for specific kinds of rejection in the prosecution history of Answer: The first comment is not motions like those found in § 1.637 the involved application or patent or by adopted because the mere inclusion of (2003). The comment expresses the a substantive motion by the opposing the stated fact in a paper places the fact hope that the requirements of § 1.637 party. in issue. Any other approach would (2003) not linger as an unwritten If an opponent believes the movant lead to fruitless argument about whether requirement. has not met this burden, it should raise a fact was placed in issue or not. If the Answer: Section 41.121(c) contains and explain the issue in its opposition. comment is hinting that a party might general requirements for the contents of The Board views with disfavor use a statement of material fact to obtain motions. Some § 1.637-like oppositions that merely point out the an admission on an extraneous fact for requirements were proposed in § 41.208, problem and then do not explain it, ulterior purposes, the Board would like but most have not been adopted in this hoping to enlist the Board’s help in to be informed of such abuses as they final rule. making the rejection. Finally, if a party occur. Section 1.637 (2003) attempted to believes that it did not have adequate Comment 127: One comment provide movants with enough detail to notice of the problem, it should explain expresses concern about § 41.121(c)(4) avoid summary dismissal or denial. In the lack of notice in its reply and then because a party not otherwise obliged to practice, however, the rule often proved address the problem on the merits. In respond to a statement of material fact to be either over-inclusive, adding any case, it would be difficult to craft a (for instance, because it does not oppose unnecessary cost, or under-inclusive, rule that would cover all or even most the relief sought), might nevertheless leading to dismissal or denial anyway. of the possibilities that will arise. feel obliged to file a paper in order to See Hillman, 55 USPQ2d at 1221 Comment 124: Another comment deny a stated fact it believes is wrong. (denying motion despite compliance suggests that the requirement in The comment suggests that a party be with § 1.637 (2003) for failure to carry § 41.121(c)(1)(iii) for ‘‘a detailed permitted to respond ‘‘not admitted’’ to its burden of proof). Ultimately, a explanation of the significance of the a fact that is not supported by the movant must prove its case evidence’’ be met by citation to the exhibits. substantively whether a rule like § 1.637 specific numbered material fact or by Answer: The comment is not adopted (2003) exists or not. The Board may citation to the specific portion of an because a denial standing by itself can develop practice notes as its experience exhibit. be helpful to the Board. The burden on with the new rules increases, in which Answer: The rule permits a party to a party to deny stated facts it believes case parties would be given notice of the cite to a particular material fact or are wrong is not very great. Moreover, practice notes. portion of an exhibit, but mere citation a ‘‘not admitted’’ response is not Comment 122: One comment suggests to a fact is not an explanation of the fact. helpful. If the party agrees with the fact that § 41.121(c)(1)(ii) require that each One purpose of an argument is to despite the inadequacy of the exhibits,
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then the proper course is to admit the Answer: As a broad proposition, the argument time for each issue or for all fact or remain silent and let it be Board has considerable authority in issues. The comments also suggest a deemed admitted; otherwise, the party setting times and determining the mechanism for requesting additional should deny the fact, if only to direct course of the proceeding and thus time. the Board’s attention to the issue. authority to file an opposition or reply Answer: The default total time for oral Perhaps best of all, the party could alert should be viewed as a default rather argument for each party is twenty the opposing party to the defect so that than a right. Indeed, § 41.123(b)(2) minutes regardless of the number of any flaw in the statement could be makes clear that oppositions are not issues for which the argument has been corrected before any response is due. automatic for miscellaneous motions. It granted. The Board may, however, Comment 128: A new § 41.121(e) has is fairly common for a party to be authorize a different amount of time been inserted to relocate the claim chart advised that no opposition or reply will (§ 41.104(c)). As a practical matter, if requirement of proposed § 41.208(d) be authorized in cases where such questioning from the bench is active, into subpart D. Two comments address filings would be moot. Nevertheless, the then more time is accorded at the proposed § 41.208(d). One comment filing of oppositions and replies is the discretion of the presiding requests greater guidance on the form default practice in contested cases administrative patent judge. A party that and content of the claim charts and on before the Board. The rule has been knows in advance that it will need more whether they count against any page written to reflect the default practice. time can seek more time by filing a limit. The other comment opposes the Comment 132: One comment objects miscellaneous motion (§ 41.121(a)(3)). requirement as costly and of to the default times in § 41.123(a) for Comment 136: Two comments questionable use. filing oppositions and responsive recommend that § 41.124(e) be amended Answer: Claim charts permit a party motions. The comment expresses to state that an oral argument transcript to explain clearly and succinctly what it concern that the default times are too filed with the Board becomes part of the thinks a claim means in comparison to short and may otherwise not be record. something else, such as another claim, appropriate in many cases. Answer: Any paper that is properly a reference, or a specification. No form Answer: The default times are set as filed becomes part of the record. Cf. is specified in the rule because each defaults in the event that no times are § 41.7(a) providing for expungement party has an incentive to produce a clear set by order. See § 41.104(c). The from the record of improperly filed claim chart that illustrates its point. The expectation is that the Board official papers. question about page limits is moot since assigned to administer a case will tailor Comment 137: Two comments the rules set no page limits. times appropriate to each case. As in the address § 41.125(a) regarding the order Comment 129: Section 41.122 has current practice, responsive motions in which the Board addresses motions. been retitled ‘‘Oppositions and replies’’ will typically be filed before any One comment requests an opportunity and the content requirements of oppositions are required. for the parties to opine on the best order § 41.121(c)(4) have been moved to a new Comment 133: Three comments for consideration or to explain why § 41.122(a). Proposed § 41.122 is now oppose § 41.123(b)(2), regarding default deferral would make sense (or not). § 41.122(b). As proposed, § 41.122 times for oppositions and replies for Answer: At present, there are several addressed new arguments in miscellaneous motions, which all three mechanisms for expressing such oppositions and replies. One comment agree are too short and are unnecessary. opinions. Parties routinely mark papers objects to the second and third Answer: The default times in as contingent on another motion, which sentences of § 41.122 regarding new § 41.123(b)(2) are the same as the default implies an order for consideration. arguments in oppositions and replies. times in Standing Order ¶ 13.10.2. In Moreover, the conferences for setting The comment expresses concern that practice, there has not been a problem times often result in a discussion of the second sentence limits the scope of because most miscellaneous motions are whether the order for consideration of opposition argument, but the comment unopposed or are resolved in a issues should be specified. For instance, does not give an example of its concern. telephone conference. An opposed threshold issues are often advanced to Answer: The second sentence of what motion must be authorized, the point where briefing on threshold is now § 41.122(b) was confusing and § 41.123(b)(1)(ii), in which case the issues is completed before other not necessary. It has been deleted. parties can suggest that different times motions are even filed. By contrast, Comment 130: One comment for the opposition and reply be set in antedating proofs related to expresses concern that the third the order authorizing the motion. patentability attacks under 35 U.S.C. sentence of what is now § 41.122(b), Comment 134: One comment suggests 102(a) or (e), inventorship issues, and which addresses replies, actually that a rule analogous to § 1.639 (2003) unenforceability issues are often permits new arguments in the reply be added to require exhibits be filed and deferred until the priority phase. because a movant could use the reply to served with the paper relying on the Nothing in the rule bars or should even cure defects in the motion first noted in exhibit. be viewed as discouraging parties from the opposition. The comment prefers Answer: A new § 41.123(c) has been letting the Board know of a party’s the wording in § 1.638(b) (2003). added to provide as a default that an opinion on the order in which issues Answer: Section 1.638(b) (2003) is exhibit must be filed and served with should be considered, provided that the susceptible to the same misreading the the first paper citing the exhibit. An parties keep in mind that the order is comment proposes for § 41.122(b). exhibit that has already been filed ultimately discretionary with the Board. Under either rule, an argument first should not be filed again (§ 41.7(b)) and Comment 138: One comment suggests made in a reply would not be attributed one that has been served need not be explicitly requiring the order to be to the motion, and thus would not cure served again. The current practice is to ‘‘reasonable’’. the deficiency of the motion. defer the filing of most exhibits until a Answer: In this context, ‘‘reasonable’’ Comment 131: One comment time shortly before the motions will be simply means no abuse of discretion. proposes that replies should not be decided. All Board discretionary actions are automatic, but rather should require Comment 135: Two comments suggest either reasonable or are subject to attack separate Board authorization or other that § 41.124(c) is unclear regarding for abuse of discretion. Consequently, additional regulation to prevent abuse. whether a party has twenty minutes of the amendment is superfluous.
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Comment 139: One party suggests unnecessary under current case law. A suggests that parties are appropriately modifying § 41.125(c)(3)(ii) regarding timely request for reconsideration restrained in requesting sanctions and the requirement that a rehearing request automatically tolls the time for seeking that the Board is similarly restrained in point specifically to ‘‘the place where judicial review. In re Graves, 69 F.3d applying them. Note that a frivolous the matter was previously addressed in 1147, 1151, 36 USPQ2d 1697, 1700 charge that an opponent’s argument is a motion, opposition, or reply’’. (Fed. Cir. 1995). Since the decision on misleading would be sanctionable. According to the comment, the rule rehearing on the judgment is itself a Consequently, the inclusion of does not address instances where the final decision from which judicial misleading arguments as a basis for Board reaches an issue sua sponte. review may be sought, 35 U.S.C. 141, sanctions is both necessary and unlikely Answer: If a party believes that the the decision on rehearing effectively to result in significant abuse. Board improperly reached an issue sua resets the time for seeking judicial The provision in paragraph (a)(3) for sponte, then pointing out that the issue review. sanctioning dilatory tactics is not was not previously addressed in a Comment 144: One comment necessarily redundant. For instance, if a motion, opposition, or reply would recommends that proposed § 41.128 party requests and is granted a delay in comply with § 41.125(c)(3)(ii). The party regarding termination be restated to good faith, but subsequently abuses the would still need to identify what the hold interferences to be merely delay, there might not be a violation of Board misapprehended or overlooked in suspended during the period of any paragraphs (a)(1) or (a)(2). In any case, reaching its decision (§ 41.125(c)(3)(i)). judicial review. The comment opposes the inclusion of a sanction for dilatory Comment 140: One comment seeks the rule as written because it places tactics emphasizes the Board’s clarification on whether the estoppel in settlements during subsequent judicial commitment to avoiding undue delays § 41.127(a) applies to a party that review outside the purview of 35 U.S.C. in light of the availability of patent term ‘‘prevails’’ on priority, but is held to 135(c). The comment is concerned that adjustments under 35 U.S.C. have unpatentable claims. the rule creates a trap for parties settling 154(b)(1)(C)(i). Answer: A party that loses on during judicial review if a court Comment 146: One comment patentability for an involved claim will subsequently disagrees with the Office’s recommends that § 41.150(b)(1)(i) be receive an adverse judgment (that is, construction of 35 U.S.C. 135(c) and modified to add patent applications lose) on patentability for that claim and recommends that current Rule 661 be incorporated by reference into an consequently will be estopped with retained. involved patent or application to the list regard to the patentability of the subject Answer: The Office has decided that, of materials that must be automatically matter of that claim. Note that since since termination has a meaning in 37 served upon request. priority is effectively a question of CFR part 1, subparts D and H, and in Answer: The comment is adopted. unpatentability under 35 U.S.C. § 1.197, that differs from the meaning Comment 147: One comment suggests 102(g)(1), one never prevails on priority proposed in §§ 41.56, 41.83, and 41.128, that § 41.150(c) regarding additional in any absolute sense: one can only lose confusion may result. Consequently, discovery expressly state that the on the issue of priority. In re Kyrides, proposed §§ 41.56, 41.83, and 41.128 are ‘‘interests of justice’’ must include (1) a 159 F.2d 1019, 1022, 73 USPQ 61, 63 deleted and § 41.129 is renumbered as showing that the evidence requested in (CCPA 1947). § 41.128. Further, the text of former Rule discovery is not available to the movant Comment 141: Two comments note 661 has been modified and incorporated and (2) a showing as to why the that abandonment or disclaimer of the into § 41.205(a) to define termination of evidence requested in discovery is invention of the count, both grounds for an interference proceeding for purposes necessary to establish a prima facie adverse judgment under § 1.662 (2003), of 35 U.S.C. 135(c). Rule 41(d)(2), Fed. basis for relief, so as to preclude are omitted from § 41.127(b). One R. App. Procedure, controls when the discovery fishing expeditions. comment seeks clarification of the mandate of the Court of Appeals will Answer: As in the current practice, practical effect of the omission. The issue in the event that a party filed a requests for additional discovery under other comment suggests that the petition for writ of certiorari to the § 41.150(c) must be authorized (usually abandonment ground be restored. United States Supreme Court. Unless a in the form of a miscellaneous motion Answer: The abandonment and party petitioning for a writ of certiorari under § 41.121(a)(3)), which has long disclaimer of the invention grounds seeks and obtains a stay of the appellate offered sufficient protection against were omitted as redundant with other court’s mandate, proceedings will be fishing expeditions. grounds listed in § 41.127(b). Hence, considered terminated with the issuance Section 41.150(c) has been divided their omission should have no practical of the mandate, as noted in Rule into two parts, with the addition of a effect beyond making the rule shorter. 197(b)(2) and 41.205(a). paragraph (2) to restore the production Comment 142: One comment makes Comment 145: One comment, while of documents and things currently two suggestions regarding requests for applauding the intent of now available under § 1.687(b) (2003). reconsideration under § 41.127(d). The renumbered § 41.128(a) regarding Section 41.152 addresses when and first parallels the comment on sua sanctions, expresses concern that the how the Federal Rules of Evidence are sponte Board action under word ‘‘misleading’’ in paragraph (a)(2) is applied. Section 41.156(c), regarding the § 41.125(c)(3)(ii). too subjective and that the provision determination of foreign law, has been Answer: As with § 41.125(c)(3)(ii), if regarding dilatory tactics in paragraph relocated to § 41.152(d) because it can the problem asserted is that the Board (a)(3) is redundant with the other be an exception to the use of the Federal reached an issue that was not raised, provisions of § 41.128(a). Rules of Evidence. Moreover, it is then pointing out that it was not raised Answer: While the word ‘‘misleading’’ relevant to § 41.157 as well as § 41.156. complies with § 41.127(d). calls for the exercise of judgment, it is Comment 148: Four comments oppose Comment 143: The second suggestion no more subjective than ‘‘frivolous’’, the requirement in § 41.155(b)(1) for is that the tolling of the time for seeking which also occurs in paragraph (a)(2). objections to be filed within five judicial review be automatic rather than Moreover, the sanction for misleading business days of service of evidence. discretionary with the Board. arguments addresses a problem distinct Answer: The time period is a default Answer: The last sentence regarding from frivolous arguments. The history of and can be extended on request tolling has been removed because it is the use of sanctions at the Board (§§ 41.104(c) and 41.121(a)(3)). The five-
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day period has been part of the Standing party who believes that an opponent’s constructive reduction to practice in Order (¶ 14.1.1) for five years. In that correction substantively changes the terms of ‘‘benefit’’ because that term was time, very few problems have arisen testimony should promptly bring the causing confusion. The term ‘‘benefit’’ with the requirement. matter to the attention of the Board. occurs much more commonly in the 35 Comment 149: One comment U.S.C. 120 sense than in the interference Part 41, Subpart E—Patent Interferences requested that the provision in Standing sense. Unfortunately, all of the other Order ¶ 14.1.2 that an objection not Comment 154: Section 41.200(b) candidates for succinctly expressing the made on the record is deemed waived provides a rule of construction for key idea, like ‘‘anticipation’’, are also be included in § 41.155(b)(1). claims in interferences. One comment freighted with considerable non- Answer: The requirement is preserved suggests a rule for interpreting counts in interference implications. While in § 41.155(c), which requires a party light of the involved specifications. ‘‘reduction to practice’’ is occasionally filing a motion to exclude to point to Answer: The count defines the used in other contexts, its primary use where the objection was made in the interfering subject matter, which in turn has been associated with priority proofs. record. An objection first raised in a depends on what the parties are Hence the phrase ‘‘constructive motion to exclude would be untimely claiming. Consequently, as with claims, reduction to practice’’ is the best choice, (§ 41.4(b)). the primary meaning of the count must but the definition has been revised to tie Comment 150: One comment requests be based on the plain language of the it more closely with the idea of that § 41.155(b)(2), regarding the filing count, but the corresponding claims can anticipation under 35 U.S.C. 102(g)(1). of supplemental evidence, be amended set bounds on what the count This change represents a clarification of, to clarify that additional reasonably means, particularly when the rather than a change to, the current supplementation is not permitted in count is defined in terms of a party’s practice. response to an objection to the claim. Since § 41.200(b) provides for Comment 158: A second group supplemental evidence. reference to the specification in expresses concern that the scope of the Answer: The rules do not authorize a interpreting claims, by extension the rule could be read too narrowly, for second objection. The party objecting involved specifications can influence instance, to exclude an express should timely make all objections to the the broadest reasonable construction of disclosure and enablement of a genus first evidence. The supplemental the count via the claim defining the without any disclosure of a particular evidence will either cure the objections count. species within the genus when the or it will fail to do so. If the party Comment 155: One comment suggests subject matter of the count is generic. objecting believes the supplemental that definitions in § 41.201 be numbered Answer: This concern should also be evidence does not cure the objection, as subsections. resolved by refocusing the rule on then rather than file a second objection Answer: As noted with regard to anticipation. As with other forms of it should pursue its initial objection § 41.2, the Office of the Federal Register anticipation directed to claims, a with a motion to exclude, explaining discourages numbering definitions. constructive reduction to practice can how the supplemental evidence failed Comment 156: Section 41.201 defines be satisfied with a disclosure and to cure the defect. ‘‘accorded benefit’’. One comment enablement of the full scope of the Comment 151: One comment inquires whether the definition of count or with disclosure and requested clarification of the ‘‘accorded benefit’’ is intended to cover enablement of a something within the relationship between § 41.156, which applications filed in foreign countries, scope of the count. deals with compelled testimony and particularly prior to the critical dates for Comment 159: The final group production, and § 41.150, which deals the North American Free Trade suggests clarification of whether co- with discovery generally. Agreement and the Uruguay Round pendency in a chain of applications is Answer: Since compelled testimony Agreement Amendments. As the required or that a requirement of co- involves the issuance of a subpoena comment notes, the definition is based pendency be included in the definition. under 35 U.S.C. 24, it involves different on 35 U.S.C. 102(g). Answer: The requirement of co- considerations than other discovery and Answer: The definition is limited to pendency appears to be implicit in the testimony. what would constitute a constructive law both by the exception for Comment 152: One comment suggests reduction to practice under 35 U.S.C. abandoned, suppressed, and concealed that § 41.157(b)(2)(ii), regarding 102(g)(1), taking into account other subject matter, and by the analogy to In testimony outside the United States, relevant statutes like 35 U.S.C. 104, as re Costello, 717 F.2d 1346, 1350, 219 permit parties to stipulate to the taking well as relevant case law. The point of USPQ 389, 391 (Fed. Cir. 1983) (a 35 of such testimony. the revised rule is to focus on priority U.S.C. 102(e) case). The definition Answer: The agreement of the parties proofs rather than the less relevant right provided for ‘‘earliest constructive to take testimony in a foreign country is to benefit under 35 U.S.C. 120 and reduction to practice’’ makes clear that only one of many factors that influence related statutes. continuity is required. To clarify this whether such testimony might be Comment 157: Section 41.201 also point, the definition of ‘‘earliest authorized. defines ‘‘constructive reduction to constructive reduction to practice’’ has Comment 153: One comment states practice’’. Five comments address this been relocated into, and amended to be that some practitioners abuse the definition. They broke into three consistent with, the revised definition of opportunity to note errata in testimony. overlapping groups. One group ‘‘constructive reduction to practice’’. The comment suggests modifying expresses concern that the phrase Comment 160: One comment suggests § 41.157 to require that any correction ‘‘constructive reduction to practice’’ has that the use of the phrase ‘‘patentably must accurately reflect the questions come to have other meanings, which distinct’’ in the definition of ‘‘count’’ posed and the answers provided. could lead to confusion. under § 41.201 could be confusing. The Answer: Modifying the rule will not Answer: The problem the first group comment proposes a definition based on make it so. If a correction materially identifies pervades patent law, where the test for interfering subject matter in alters testimony, it may be a falsification concepts are tightly, but not always § 41.203(a). of the testimony and may expose the smoothly, integrated. The new rules Answer: Two counts must be party or the counsel to sanctions. A shifted away from discussing patentably distinct; if not, they define
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the same invention and can only third-party patent or published a lack of written description, when support a single count. The phrase application that triggers the bar. Nothing provoking an interference. patentably distinct comes from the case in the definition of ‘‘threshold issue’’ Section 41.202(a)(2) has been law dealing with separate counts in an prevents the movant from raising the bar modified to clarify that an applicant interference. Hester v. Allgeier, 687 F.2d as an ordinary attack on patentability. suggesting an interference must also 464, 466, 215 USPQ 481, 482 (CCPA The suggested clarification is propose at least one count (as defined in 1981). The phrase has an established unnecessary because the rule does not § 41.201) since an explanation of meaning as a difference between subject change the requirements for proving the correspondence to the count is required matter that would have been neither bar, but rather limits the instances in in § 41.202(a)(3). anticipated nor obvious. Aelony v. Arni, which the bar will be treated as a Section 41.202(a)(3) requires an 547 F.2d 566, 570, 192 USPQ 486, 490 threshold issue. applicant suggesting an interference to (CCPA 1977). Patentable distinctness is Comment 163: The comment identify the claims that interfere and a one-way test. It is sufficient if the questions the inclusion of written explain how they correspond to the subject matter of either count, treated as description as a threshold issue under suggested count. When the suggestion is prior art, would not have anticipated or § 41.201. made on the basis of a published rendered obvious the subject matter of Answer: Written description application, the decision to declare an the other count. Two-way distinctness addresses the problem complementary interference will be based on the claims would also justify two counts, but is not to repose under 35 U.S.C. 135(b): the pending in the published application at required: it is more than what is claim was timely, but lacks an adequate the time of the decision, which may required. written description. The use of written differ from the published claims. Note Comment 161: The comment further description as a threshold issue that no interference will be declared requests clarification on what date responds to the perception that some until both applications have allowable would apply for determining whether applicants would copy a claim simply claims that still interfere. Comment 165: Section 41.202(a)(4) an additional reference was available to to provoke interferences to obtain an requires an applicant suggesting an show obviousness. inter partes administrative challenge to Answer: Such a determination is interference provide a detailed a patent, regardless of whether the outside the scope of this rule making explanation of why it will prevail on applicant had actually invented the and is better left to development priority, while § 41.202(d) requires an same subject matter as the patentee had through adjudication. Note that since a actual showing of priority. One claimed. See Snitzer v. Etzel, 531 F.2d count controls what proofs are comment suggests that these two 1062, 1065, 189 USPQ 415, 417 (CCPA admissible, it will often be advisable to sections are inconsistent. 1976) (noting the great scrutiny under permit a second count at least until the Answer: There is no inconsistency which copied claims have historically facts surrounding priority are in the between the rules. Section 41.202(a)(4) been placed). record. is a general requirement that any Comment 162: One comment The Office has been firm in its applicant suggesting an interference addresses the definition of ‘‘threshold position that patent interferences are not provide an explanation of why it will issue’’ under § 41.201. It criticizes the generalized patent cancellation prevail. If the applicant has the earliest narrowed application of 35 U.S.C. proceedings. The Office has proposed effective filing date, the explanation 135(b) as a threshold issue. an enhanced post-grant review should ordinarily be fairly simple. Answer: The 35 U.S.C. 135(b) bar and proceeding to fill the perceived need for Section 41.202(d) addresses the case in written description issues were defined such a proceeding. United States Patent which the applicant does not have the as threshold issues to address perceived and Trademark Office, The 21st Century earlier effective filing date. In such a abuses of interference practice and, Strategic Plan at 11 (updated 3 February case, a more thorough showing is given their standing-like ability to end 2003). required because otherwise on the face an interference quickly, have been The provision for written description of the record no interference is defined narrowly for the purpose of as a threshold issue has been amended necessary to dispose of the interfering threshold issues, without any intent to to narrow it to provoked interferences claim. narrow them for the purposes of proving since that is where the concern lies. The Comment 166: One comment suggests unpatentability generally. lack of an express suggestion of an that § 41.202(a)(6)’s requirement for a In the case of a provoked interference, interference under § 41.202(a) will not chart showing supporting disclosure for the 35 U.S.C. 135(b) bar and written necessarily shield an applicant from a an embodiment within the scope of the description serve complementary threshold motion. There will be no interfering subject matter is too narrow functions. The 35 U.S.C. 135(b) bar is examination of an applicant’s intent to since it does not address instances intended to provide a patentee (or provoke an interference where the where there is disclosure of the entire published applicant) repose from any opportunity to have done so is clear. interfering subject matter, but not of a attack more than one year after issuance Any other practice would open the specific embodiment. or publication of the interfering claim. practice to abuse and misconduct. Answer: The rule is modified to refer In short, it bars a claim that an applicant Comment 164: The comment to a constructive reduction to practice might otherwise be entitled to receive questions whether enablement should within the scope of the interfering had it been entered earlier. also be a threshold issue. subject matter. Since the definition of The use of the 35 U.S.C. 135(b) bar as Answer: Since the list of threshold constructive reduction to practice in a threshold issue is limited to patents or issues is inclusive, it would permit § 41.201 has been clarified to reflect applications of the movant because the additional issues to be treated as anticipation under 35 U.S.C. 102(g)(1), entitlement to repose is personal to the standing issues. Whether enablement is this change should also address the patentee or published applicant. There routinely such an issue is left to further suggestion in this comment. is no third-party entitlement to repose, development through adjudication. The Comment 167: Three comments particularly since the movant asserting current impression is that the suggest that § 41.202(b), regarding the bar may also believe it is also enablement requirement appears to be patentees seeking interferences, include entitled to an interference with the less frequently abused, in the absence of a reference to § 1.99. One suggests that
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§ 41.202(b) is too restrictive, while two months preparing an application, then 102(a), 102(e), and 103(a) into of the comments suggest it might be we should also be able to make the same interferences simply because the subject inconsistent with the more restrictive assumption about the earlier-filing matter claimed in the prior art § 1.99. interfering patent, in which case the anticipated or rendered obvious the Answer: The rule is not intended to assumption does little to address subject matter subsequently claimed. create, eliminate, or modify a remedy whether the applicant was the first to The one-way practice has never been available under § 1.99 or § 1.291. The invent. See Paulik v. Rizkalla, 760 F.2d the standard for interfering subject rule simply observes that the process for 1270, 1282, 226 USPQ 224, 232–33 matter. Although some comments suggesting an interference is not (Fed. Cir. 1985) (Rich, J., concurring; suggest that the two-way test of available to a patentee and points to an making a similar point). § 41.203(a) originated with Winter v. alternative remedy. Section 41.202(b) is Comment 170: One comment suggests Fujita, 53 USPQ2d 1234 (BPAI 1999), revised to clarify this intent and to point distinguishing between complex and that decision only originated the use of patentees to both § 1.99 and § 1.291. simple technologies in § 41.202(d). The the term ‘‘two-way’’ in the context of Comment 168: One comment comment does not offer a definition of interfering subject matter. The two-way expresses concern about § 41.202(c), simple or complex technology. test itself has long been implicit in the under which an examiner may require Answer: Such a distinction would be test for no interference-in-fact: one-way an applicant to add an interfering claim. unworkable in practice. patentable distinctness. See, e.g., Aelony The comment worries that the applicant Comment 171: Another comment v. Arni, 547 F.2d 566, 570, 192 USPQ is placed in an awkward position if an suggests waiting until the interference is 486, 490 (CCPA 1977). It is worth noting examiner suggests an interfering claim initiated to require the showing under that the test for interfering patents under that the applicant believes is improper § 41.202(d). 35 U.S.C. 291 had been framed in, if because it is not supported or because Answer: A practice of waiting would anything, even narrower terms than the the examiner’s reasoning is unclear. require the declaration of an test under § 41.203(a). See e.g., Slip Answer: The applicant’s remedy in interference, with all of the costs Track Sys. v. Metal Lite, Inc., 159 F.3d such a situation is to comply with the associated with the declaration of an 1337, 1341, 48 USPQ2d 1055, 1058 requirement, but also to add a better interference, that the applicant might (Fed. Cir. 1998) (‘‘patents that claim claim or to contest the requirement. See not want to contest. Moreover, since an identical subject matter’’). In re Ogiue, 517 F.2d 1382, 1390, 186 inadequate showing under § 41.202(d) is Comment 174: One comment suggests USPQ 227, 235 (CCPA 1975) (holding the trigger for a summary disposition that the paradox of having a one-way that refusal to copy a claim for which under § 41.202(d)(2), delay in making test for both starting and ending an the applicant had support results in the showing would drag out the interference could be resolved if the test disclaimer). The requirement that an pendency of the interference. for no interference-in-fact only worked applicant either comply by adding the Comment 172: One comment suggests in one direction. That is, the movant proposed claim or concede priority of requiring a showing under § 41.202(d) must show that its claim is patentably the proposed subject matter is not new, from junior patentees as well. distinct from the opponent’s claim see 37 CFR 1.605 (2003) and MPEP Answer: In an interference, the Office rather than showing that the opponent’s § 2305. Section 41.202(c) has been does not have jurisdiction over the claim is patentably distinct from the further modified to require showings patent until after the interference is movant’s claim. The example given is a like those under § 41.202(a)(2)–(a)(6) declared. Once the Board declares an genus claim that is anticipated by, but when the interference would be with a interference, a junior party must make a does not anticipate, another party’s patent. Any dispute arising as to priority statement under § 41.204(a). species claim. satisfaction of these added procedural Normally, the priority statement is Answer: The problem with this requirements may be petitioned. required early in the interference. suggestion is that it cedes control over Comment 169: Three comments Nothing in the rules prevents a the interference to the party with the address the requirement under summary proceeding for a patentee that species claim, who can decide § 41.202(d) to show priority. Two of the cannot show an adequate date of unilaterally whether to file for no comments suggest restoring some priority in its priority statement. interference-in-fact or not. The version of the reduced showing required Moreover, nothing prevents the Board suggested directional test also ignores under § 1.608(a) (2003) for an from expediting consideration of the Director’s role under 35 U.S.C. application with an effective filing date priority in such circumstances. 135(a) in deciding whether an within three months of an interfering Section 41.202(e) addresses what interference exists or not. patent’s effective filing date. A third evidence is sufficient to show priority. Under the directional test, an comment suggests that a similar Paragraph (2) has been added to address interference would both exist and not requirement be made of all junior a situation in which a showing cannot exist. If the Director turns a blind eye to patentees. be made because the necessary evidence the fact that there is no interference-in- Answer: The three-month practice is not available without a subpoena. In fact from one perspective, the Director under § 1.608 (2003) was eliminated such cases, a detailed proffer of the has effectively enlisted on the species because it makes little sense in many expected testimony or production may claimant’s side. Such a result would, at circumstances. The comments assume suffice. a minimum, appear to be unfair. that a fairly common practice prevails to Comment 173: Eight comments Comment 175: Six comments urge spend a few months preparing address § 41.203(a)’s definition for that a one-way test is necessary so that applications. The argument fails for two interfering subject matter. Seven oppose a senior party applicant may attack a reasons. the rule, while one seeks clarification. junior party patentee with a dominating First, while it may be common The seven that oppose would all claim. generally, it does not appear to be prefer that the Board use a one-way test Answer: The problem the comments common in all technologies and may be for interfering subject matter. identify as appropriate for an meaningless in the context of a Answer: A one-way test is not interference is instead a case of claim particular case. Second, if we are to workable since it would turn a large dominance. The remedy consequently is assume that the applicant spent three portion of rejections under 35 U.S.C. not an interference, but may be a
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reexamination or some other correspondence. The rule was which it believes that it is entitled to patentability or validity contest. The subsequently withdrawn in the face of relief. Such bases might include an Office has proposed a post-grant review public complaints that it was delaying intent to prove derivation or to move to process that would provide an the declaration of interferences without be accorded benefit of an additional appropriate forum for addressing such providing much real benefit to the constructive reduction to practice. concerns. United States Patent and parties. While some explanation is Comment 182: One comment Trademark Office, The 21st Century required before a claim can be finally expresses concern that senior parties Strategic Plan at 11 (updated 3 February rejected, the declaration simply creates must file a priority statement and 2003). The Office remains steadfast in presumptions that are developed suggests that parties be bound by their its position that an interference is not a through motions. No party is subject to preliminary statements. post-grant cancellation proceeding. a rejection or cancellation of its claims Answer: Parties are bound by their Comment 176: One comment notes without having had an opportunity to preliminary statements (§ 41.120(b)). that foreign priority proofs are treated address the presumptions in the Senior parties do not have to file a differently under 35 U.S.C. 102(g)(1) declaration. priority statement if they do not intend and (g)(2). According to the comment, Comment 179: Two comments to put on a priority case. this difference violates treaty obligations address § 41.203(d) regarding the Comment 183: One comment suggests by placing the foreign patentee at a addition of a patent or application to the that § 41.204(b) regarding the statement disadvantage under 35 U.S.C. 102(g)(2). interference. One comment questions of the basis for relief for substantive The comment urges that the Office has what happened to substituting motions is redundant with the initial responsibility to provide a applications under § 1.633(d) (2003) and § 41.121(c)(1). It recommends replacing remedy by extending the jurisdiction for also seeks guidance on when a motion the notice with a list of motions interferences to cover situations that to add a patent or an application would intended to be filed with the basis for otherwise only fall within 35 U.S.C. be timely. each motion as is required under 102(g)(2). Answer: The suggestion to add an current practice. Answer: Even assuming the comment application or a patent under Answer: The rule has been restated in is correct, the problem lies in the § 41.203(d) could be raised any time, but terms of a motions list, although the list legislative decision to treat outcomes is more likely to be granted if it is raised will require more detail than is often based on 35 U.S.C. 102(g)(1) and (g)(2) early in an interference. The intent of provided on current lists. The list is not differently. The effect of following the the rule is that it work like the decision a substitute for a motion, but it must comment’s suggestion would be to to declare an interference, hence it only provide sufficient detail to place the eliminate a distinction that the statute addresses the addition of a patent or Board and the opponent on notice of the was only recently amended to create. application. A substitution of an precise relief sought. The Board needs The only plausible reading of 35 U.S.C. application could be accomplished by adequate notice to facilitate scheduling. 102(g) is that Congress intended foreign moving to add a second application Moreover, detailed motions lists can priority proofs to be treated differently with an interfering claim and by lead to other efficiencies, such as depending on the situation in which the cancelling the involved claims in the stipulations from the opponent. issue arises. Consequently, the comment first application contingent on the Comment 184: One comment opposes would be more appropriately directed to addition of the second application to the § 41.207(a)(1) regarding the presumption Congress. interference. of the order of invention for priority. Comment 177: One comment seeks Comment 180: A second comment According to the comment, if two clarification about whether notes that § 41.203(d) permits the parties have identical dates for unpatentable claims, particularly claims addition of non-party applications or constructive reduction to practice and that are unpatentable as the result of a patents. While the comment approves, it neither elects to put on a priority case, threshold motion, would be taken into suggests requiring the movant to show then the rule suggests that both would consideration in determining whether that the claims of the added patent or lose, while the comment believes that a there are interfering claims. application are patentable. patent should issue to both. Answer: Ordinarily, claims that are Answer: The suggestion is not Answer: The rule codifies case law unpatentable would not be placed into adopted. A proceeding in which the that establishes that when both parties an interference. See § 41.102; Brenner v. third party is not a participant is not a have the same date of constructive Manson, 383 U.S. 519, 528 n.12 (1966) good place to explore the patentability reduction to practice, neither party is (observing that when a claim is of the third party’s claims. entitled to a presumption of priority. unpatentable on its face, a priority Comment 181: Five comments Van Otteren v. Hafner, 278 F.2d 738, contest need not ‘‘inexorably take address § 41.204(a) regarding priority 740, 126 USPQ 151, 152 (CCPA 1960) place’’). Similarly, if all interfering statements. Four of the comments urge (question of joint invention); Lassman v. claims become unpatentable as a result that the rule would require too much Brossi, 159 USPQ 182, 184 (Bd. Int. of a threshold motion, judgment in the information to be provided too early in 1967) (in which both parties lost when interference is justified. See Berman v. the proceeding and suggest a return to neither established priority). Housey, 291 F.3d 1345, 1351, 63 current practice under §§ 1.621–1.628 Comment 185: One comment opposes USPQ2d 1023, 1027 (Fed. Cir. 2002) (2003). One comment requests the extension under § 41.207(a)(2) of the (affirming a judgment against a party clarification about the nature and clear and convincing evidence standard with claims barred by 35 U.S.C. 135(b)). amount of documentary support to instances where the junior party Comment 178: One comment suggests required for the priority statement. applicant first files after the publication that § 41.203(b) be modified to have the Answer: Section 41.204(a) is amended of the senior party’s application. notice of declaration set forth the basis to clarify that any party that will put on According to the comment, the use of a for any claim correspondence or a priority case must file a priority higher evidentiary standard is tied to accorded benefit. statement. It has also been amended to the presumption of patent validity Answer: A similar effort was made in list specific requirements for the priority under 35 U.S.C. 282. former § 1.609 (1998) to have the statement. Section 41.204(a) still Answer: The evidentiary standard for examiner explain the basis for requires the party to state the bases on the priority case of an applicant that
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filed after the opponent’s patent issued cited in Price at n.2), an inventor should degrees of success to either claim is the clear and convincing evidence file promptly because a delay in filing around (e.g., In re Johnson, 558 F.2d standard. Price v. Symsek, 988 F.2d raises the risk that intervening actions 1008, 194 USPQ 187 (CCPA 1977)) or to 1187, 1190–91, 26 USPQ2d 1031, 1033 by another may deprive the inventor of antedate (e.g., In re Zletz, 893 F.2d 319, (Fed. Cir. 1993). In Price, the court a property right. See also 35 U.S.C. 13 USPQ2d 1320 (Fed. Cir. 1989)) the rejected the previously applied beyond 102(e) (extending the definition of prior subject matter of the lost count. a reasonable doubt standard as art to include published applications) Hardman was correct that Saunders did inconsistent with intervening Supreme and 35 U.S.C. 135(b) (extending the bar not create a per se rule of Court precedent. The court cited the to include published applications). unpatentability for generic claims, but presumption of validity as the reason for Section 41.207(a)(2) is consistent with neither does § 41.207(b). It simply using a higher standard. The Price the patent statutes in treating published creates a presumption that must be decision did not purport to be applications like patents. Unlike the addressed. instituting the use of a higher standard statutes, however, § 41.207(a)(2) does If a party with a generic claim that in such cases; rather, it was following not create a bar to patentability, but corresponds to a species count is older precedent. 988 F.2d at 1192 n.2, simply extends the existing heightened concerned about the designation, its 26 USPQ2d at 1035 n.2. The older scrutiny for late filers so that it is remedy is to move to have the generic precedent provides reason to believe triggered by publication of an claim designated as not corresponding that the presumption of validity is not application as well as issuance of a to the species count. Often, the motion the only, or even the primary, reason for patent. Use of the clear and convincing would be deferred until the priority using a higher evidentiary standard. evidence standard also furthers the phase and dismissed unless there were The best reason for believing that the important policy goal of encouraging a split award on priority, in which case presumption of validity is not the prompt filing. proof that the generic invention primary basis for the higher evidentiary Comment 186: One comment opposes antedates the priority proofs for the lost standard is that not all patents in § 41.207(b) with regard to claim species count would likely justify relief. interferences benefit from the higher correspondence. The comment gives the Comment 187: Nine comments standard. Indeed, the higher standard is example of a generic claim that oppose at least some aspect of the the exception and not the rule. ‘‘It is corresponds to both a generic count and proposed presumption under important to bear in mind that merely a specific count in which there is a split § 41.207(d) of abandonment, because one of the parties has an issued award. In such a case, the generic claim suppression, or concealment when the patent does not mean that the other would be unpatentable based on its party’s effective filing date is more than party must prove his case by [a higher correspondence to the species count, one year after the party’s actual evidentiary standard].’’ C.W. Rivise & even though the party ‘‘won’’ the reduction to practice. A.D. Caesar, 3 Interference Law & generic count. The comment Answer: The presumption has been Practice at section 467 (1947); accord distinguishes In re Saunders, 219 F.2d deleted as unnecessary. Delays longer Bosies v. Benedict, 27 F.3d 539, 541–42, 455, 104 USPQ 394 (CCPA 1955), which than 18 months will often result in a bar 30 USPQ2d 1862, 1864(Fed. Cir. 1994) was discussed in the notice of proposed to patentability or heightened scrutiny (distinguishing Price). Moreover, the rule making, because it was an ex parte (§ 41.207(a)(2)) anyway so the proposed higher standard does not apply to appeal. The comment also points to Ex rule would not have been likely to questions that do not bear directly on parte Hardman, 142 USPQ 329 (BPAI change the outcome in many priority. 3 Interference Law & Practice at 1964) for the proposition that Saunders interferences. § 471; see also In re Etter, 756 F.2d 856, does not create a per se rule of Under a priority motions practice, 857, 225 USPQ 1, 4 (Fed. Cir. 1985) (in unpatentability for generic claims in abandonment, suppression, or banc) (clear and convincing evidence such cases. concealment can be raised in the standard does not apply to patent claims Answer: Although the comment urges opposition to a priority motion. Any under reexamination). that the rule represents a change from request for additional discovery While Price rejected the older current practice, the rule simply (§ 41.150(c)) or motion for compelled evidentiary standard, it did not reject formalizes the effect of the estoppel testimony or production (§ 41.156(a)) the reasons the older precedent gave for arising out of cases like In re Deckler, should be filed promptly to ensure that using a higher standard. 988 F.2d at 977 F.2d 1449, 1452, 24 USPQ2d 1448, it is reflected in the opposition. 1192 n.2 & text, 26 USPQ2d at 1035 n.2 1449 (Fed. Cir. 1992), in which a party Comment 188: One comment suggests & text. That precedent recognized could not subsequently seek claims that adding a provision to § 41.208(a)(2) to various reasons for the higher standard. were patentably indistinct from the address adding counts. Walker v. Altorfer, 111 F.2d 164, 167, 45 subject matter of the count lost in the Answer: Section 41.208(a)(2) has been USPQ 317, 320 (CCPA 1940) (one of the interference. As earlier discussed, no reworded to substitute ‘‘definition of the cases Price cites in n.2). Among the one ‘‘wins’’ a count because surviving a interfering subject matter’’ for the first reasons discussed were concerns about priority contest for one count does not occurrence of ‘‘count’’. The point of the spurring and the degradation of mean that one is thereby entitled to a rule is to focus parties on using evidence after a long delay, 111 F.2d at claim. Kyrides, 159 F.2d at 1022, 73 substantive motions to define the range 168, 45 USPQ at 320. Both of these USPQ at 63. of admissible proofs for priority before factors apply in the case of published In Saunders, a junior party could not the priority phase begins. applications as well. claim a generic invention after losing a Comment 189: Three comments Typically applications are published species count. Although the case was an express alarm that priority is addressed 18 months after their earliest claimed ex parte appeal, it arose because as a motion under § 41.208(a)(4). The benefit date, 35 U.S.C. 122(b)(1), so most Saunders was a junior party who had principal concern appears to be that late filers would have to have delayed lost a species count, but not the generic priority will routinely be decided at the at least 18 months. As the Court of count, making the Saunders case same time as the preliminary motions. Customs and Patent Appeals cautioned directly relevant. The case law has Answer: The rules do not require in Horwath v. Lee, 564 F.2d 948, 950, many examples of parties who having priority to be decided simultaneously 195 USPQ 701, 704 (CCPA 1977) (also lost interferences try, with varying with the preliminary motions. Indeed,
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the point of preliminary motions is to create a patentability issue without the duty is high because of the nature simplify the issues for consideration addressing it until the reply brief. While of the proceeding. during the priority contest, for instance a requirement to prove a negative The Office has proposed a by better defining the patentable subject should generally be avoided, disciplinary rule that is not as limited matter. Instead, the rules provide for sandbagging an opponent is never in scope as § 1.56 or § 1.555 as a basis contesting priority in the form of acceptable. Moreover, the rule is for disciplining patent practitioners. 68 motions. On the other hand, the rules consistent with the duty of candor to the FR 69442, 69555, § 11.303(d). Rather would permit priority to be taken up Office, particularly since the opposing than codify the existing duty of candor with, or instead of, preliminary motions party might not oppose the motion. in yet another narrow context, the Board in an appropriate case. The Board works Not all showings of patentability will rely on its authority to sanction out the details of how a given priority require the proof of a negative. For misconduct (§ 41.128(a)) and to regulate case will proceed on a case-by-case instance, a movant adding a claim must counsel (§ 41.5) to address violations of basis. show where the written description for the duty of candor that may arise in a Motions practice is much more the claim can be found (§ 41.110(c)(2)). contested case. efficient than the current briefing Where a negative showing is required, a Administrative Procedure Act: The practice since each movant must party may show that it is unaware of a notable changes in this final rule are: (1) explain the evidence on which it relies basis for unpatentability. When an Consolidating ex parte appeal rules, rather than simply dumping it on the applicable patentability question has inter partes reexamination appeal rules, opposing party and waiting to see what been raised during prosecution or in an and patent interference rules in a new can be made of it. Several interferences opponent’s motion, however, it is not part 41 of 37 CFR; (2) providing Subpart have already had priority contests in onerous for the movant to address that A of new part 41 to consolidate general motions form. Typically, the junior specific question. This is particularly provisions relating to the Board of party presents its motion along with its true for a responsive motion seeking to Patent Appeals and Interferences and evidence of priority. The motion address an opponent’s motion alleging make them consistent across different explains the evidence and gives the unpatentability. The responsive motion proceedings; (3) providing an express senior party an opportunity to see how cannot truly be responsive without delegation from the Director of the United States Patent and Trademark the junior party is relying on the explaining how it avoids the Office to the Chief Administrative evidence. Next, the senior party unpatentability. Patent Judge to decide petitions arising presents its motion if it elects to present For counts, the main concern arises a case. Both parties then file oppositions in Board proceedings; (4) providing a when a count is broadened to include and replies. A motions process delegation of limited authority to handle additional subject matter. Since a count eliminates the need for briefing after the disqualifications under 35 U.S.C. 32 defines the scope of proofs admissible to evidence is served. from the Director to the Chief Comment 190: As noted previously, prove priority, it is necessary for the Administrative Patent Judge; (5) most of § 41.208(c) has not been adopted count to be patentable over the prior art. providing Subpart B of new part 41 in the final rule. Like § 1.637 (2003), Otherwise, embodiments unpatentable setting forth the rules of practice for ex § 41.208(c) was plagued with problems over the prior art could be used to prove parte appeals; (6) limiting amendments of over- and under-inclusiveness. See priority. As with claims, a party may filed on or after the date of filing a brief; Hillman, 55 USPQ2d at 1221. Section show that it is unaware of prior art that (7) changing the format and content of 41.208(c) is now limited to requiring a would anticipate or render obvious the the appeal brief; (8) providing Subpart showing of patentability whenever a subject matter of the count. C of new part 41 setting forth the rules claim is proposed to be added or Comment 191: One comment suggests of practice for inter partes amended. Consequently, most of the that there be a rule in interferences reexamination appeals; (9) providing comments on § 41.208(c) are moot. comparable to § 1.56 and § 1.555 Subpart D of new part 41 setting forth Five comments address proposed requiring candor toward the Office. general rules of practice for contested § 41.208(c)(4)(ii), now part of Answer: Such a rule falls outside the cases, which currently are patent § 41.208(c)(2), in which a party scope of this rule making and is, in any interferences (35 U.S.C. 135) and broadening the count must show the case, unnecessary. Litigants and their ownership (42 U.S.C. 2182 and 2457(d)); proposed count does not include prior counsel always have a duty of candor (10) providing Subpart E of new part 41 art. Four comments address proposed toward a tribunal. This is particularly setting forth rules of practice specific to § 41.208(c)(5)(i), now § 41.208(c)(1), in true when the litigant appears before the patent interferences; (11) clarifying which a party adding a claim must show tribunal ex parte. American Bar issues regarding when there is an the patentability of the claim. One Association, Model Rules of interference-in-fact, how claims comment urges that the showing be Professional Conduct 3.3(d). Since the correspond to a count, and how benefit limited to overcoming contrary Board can independently explore of earlier applications is accorded; (12) positions taken during prosecution. The questions of patentability, § 41.121(f), providing that an applicant adding a other comments oppose the rule as even parties in a contested case stand claim to provoke an interference with a requiring the movant to prove a before the Board in an ex parte capacity. patent pursuant to a requirement by an negative. Cf. SmithKline Beecham Corp. v. Apotex examiner must provide additional Answer: Section 41.208(c) is now Corp., 365 F.3d 1306, 1321, 70 USPQ2d details about the count, accorded limited to the requirement to show 1737, 1748 (Fed. Cir. 2004) (Gajarsa, J., benefit, and claim correspondence for patentability. Any time a claim or count concurring) (patentability can always be the proposed interference, and (13) is added or amended, the movant must raised sua sponte). Moreover, the clarifying that a two-way show that the claim or count does not limited discovery in Board proceedings unpatentability test is used to determine run afoul of any known patentability reduces the check usually available in whether claimed inventions interfere. problem. The comments are correct that adversarial proceedings, thus further The changes in this final rule relate the requirement often obliges the increasing the duty of candor owed to solely to the procedure to be followed movant to prove a negative, but the the Office. Consequently, there is a duty in filing and prosecuting a patent alternative is to permit a movant to of candor with or without a rule, and application, filing and prosecuting an
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appeal to the Board, and contested proposed rules would have on small significant economic impact on small cases. Therefore, these rule changes entities. entities. involve interpretive rules, or rules of The Office receives approximately Accordingly, the Deputy General agency practice and procedure under 5 350,000 patent applications annually. Counsel for General Law of the United U.S.C. 553(b)(A), and prior notice and The final rules contained in this rule States Patent and Trademark Office has an opportunity for public comment package apply to those applications certified to the Chief Counsel for were not required pursuant to 5 U.S.C. where an appeal brief is filed with the Advocacy of the Small Business 553(b)(A) (or any other law). See Board and to those applications where Administration that changes contained Bachow Communications Inc. v. FCC, an interference is suggested. in this final rule will not have a 237 F.3d 683, 690 (D.C. Cir. 2001) (rules Approximately 7,300 appeal briefs are significant economic impact on a governing an application process are filed in the Office each year. Of this substantial number of small entities. ‘‘rules of agency organization, number, small entities file, on average, Executive Order 13132: This final rule procedure, or practice’’ and exempt approximately 1,552 appeal briefs does not contain policies with from the Administrative Procedure Act’s annually. For example, in Fiscal Year federalism implications sufficient to notice and comment requirement); 2003, 1,717 small entities filed appeal warrant preparation of a Federalism Merck & Co., Inc. v. Kessler, 80 F.3d briefs; in Fiscal Year 2002, 1,442 small Assessment under Executive Order 1543, 1549–50, 38 USPQ2d 1347, 1351 entities filed appeal briefs; and in Fiscal 13132 (Aug. 4, 1999). (Fed. Cir. 1996) (the rules of practice Year 2001, 1,497 small entities filed Executive Order 12866: This final rule promulgated under the authority of appeal briefs. The average number of has been determined to be not former 35 U.S.C. 6(a) (now in 35 U.S.C. small entities affected by these rule significant for purposes of Executive 2(b)(2)) are not substantive rules (to changes is a very small percentage of the Order 12866 (Sept. 30, 1993). which the notice and comment total number of applications processed Paperwork Reduction Act: This final requirements of the Administrative by the Office (approximately 0.4%). rule involves information collection Procedure Act apply)); Fressola v. These final rules do not impact a requirements which are subject to Manbeck, 36 USPQ2d 1211, 1215 substantial number of small entities. review by the Office of Management and (D.D.C. 1995) (‘‘it is doubtful whether Moreover, the fees associated with filing Budget (OMB) under the Paperwork any of the rules formulated to govern an appeal with the Board are set by Reduction Act of 1995 (44 U.S.C. 3501 patent and trade-mark practice are other statute and by previous rule makings, et seq.). than ‘interpretative rules, general and have not been adjusted in any Currently approved forms include statements of policy, * * * procedure, manner in the current rule making. The PTO/SB/31 (Notice of appeal) and PTO/ or practice’’’ (quoting C.W. Ooms, The procedural rules contained in this rule SB/32 (Request for hearing), both of United States Patent Office and the making package do not increase the cost which were cleared under the OMB Administrative Procedure Act, 38 of filing or processing an appeal before 0651–0031 collection, which will expire Trademark Rep. 149, 153 (1948). the Board. Thus, these rules have no at the end of July 2006. Regulatory Flexibility Act: As significant economic impact on small Notwithstanding any other provision previously discussed, the changes in entities. of law, no person is required to respond this final rule involve interpretive rules, On average, about 109 interferences to nor shall a person be subject to a or rules of agency practice and are declared in the Office each year. For penalty for failure to comply with a procedure, and prior notice and an example, in Fiscal Year 2003, 95 collection of information subject to the opportunity for public comment were interferences were declared; in Fiscal requirements of the Paperwork not required pursuant to 5 U.S.C. Year 2002, 109 interferences were Reduction Act unless that collection of 553(b)(A) (or any other law). Because declared; and in Fiscal Year 2001, 124 information displays a currently valid prior notice and an opportunity for interferences were declared. The Office OMB control number. public comment were not required for does not maintain statistics to show the List of Subjects the changes in this final rule, a final number of small entities that participate Regulatory Flexibility Act analysis is in interferences before the Office 37 CFR Part 1 also not required for the changes in this annually. Each interference involves Administrative practice and final rule. See 5 U.S.C. 603. two parties. Even assuming that every procedure, Biologics, Courts, Freedom Nevertheless, the Office published a participant in an interference of information, Inventions and patents, notice of proposed rule making in the proceeding is a small entity (double the Reporting and recordkeeping Federal Register, 68 FR 66648 (Nov. 26, average number of interferences—about requirements, Small businesses. 2003), and in the Official Gazette of the 218 per year), the average number of United States Patent Office, 1277 OG small entities possibly affected by these 37 CFR Part 5 139 (Dec. 23, 2003), in order to solicit rule changes is a very small percentage Classified information, Exports, public participation with regard to this of the total number of applications Foreign relations, Inventions and rule package. Pursuant to the notice of processed by the Office (approximately patents. proposed rule making, the Deputy 0.0006%). These final rules do not General Counsel for General Law of the impact a substantial number of small 37 CFR Part 10 United States Patent and Trademark entities. Moreover, the fees associated Administrative practice and Office certified to the Chief Counsel for with filing an interference with the procedure, Inventions and patents, Advocacy of the Small Business Board are set by statute and by previous Lawyers, Reporting and recordkeeping Administration under the provisions of rule makings, and have not been requirements. section 605(b) of the Regulatory adjusted in any manner in the current Flexibility Act that the proposed rule rule making. The procedural rules 37 CFR Part 11 would not have a significant economic contained in this rule making package Administrative practice and impact on a substantial number of small do not increase the cost of filing or procedure, Inventions and patents, entities. No comments were received processing an interference before the Lawyers, Reporting and recordkeeping which referenced any impact the Board. Thus, these rules have no requirements.
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37 CFR Part 41 (d) * * * to request reconsideration and seek Administrative practice and (9) In contested cases before the Board court review before any portions of a procedure, Inventions and patents, of Patent Appeals and Interferences decision are made public under this Lawyers. except as the Board may expressly paragraph over his or her objection. authorize. I For the reasons stated in the preamble, * * * * * the Under Secretary of Commerce for * * * * * I 10. In § 1.17, remove and reserve Intellectual Property and Director of the I 6. Amend § 1.8 by removing and paragraphs (c) and (d), and revise United States Patent and Trademark reserving paragraph (a)(2)(i)(B) and by paragraphs (b) and (h) to read as follows: Office amends 37 CFR chapter I as revising paragraph (a)(2)(i)(C) to read as follows: follows: § 1.17 Patent application and reexamination processing fees. PART 1—RULES OF PRACTICE IN § 1.8 Certificate of mailing or * * * * * PATENT CASES transmission. (b) For fees in proceedings before the (a) * * * Board of Patent Appeals and I 1. The authority citation continues to (2) * * * Interferences, see § 41.20 of this title. read as follows: (i) * * * * * * * * (C) Papers filed in contested cases Authority: 35 U.S.C. 2(b)(2), unless (h) For filing a petition under one of otherwise noted. before the Board of Patent Appeals and the following sections which refers to I 2. Amend § 1.1 to remove paragraph Interferences, which are governed by this paragraph: $130.00. (a)(1)(iii) and to revise paragraph § 41.106(f) of this title; § 1.12—for access to an assignment (a)(1)(ii) to read as follows: * * * * * record. I § 1.1 Addresses for non-trademark 7. In § 1.9, revise paragraph (g) to read § 1.14—for access to an application. correspondence with the United States as follows: § 1.47—for filing by other than all the Patent and Trademark Office. § 1.9 Definitions. inventors or a person not the inventor. (a) * * * § 1.53(e)—to accord a filing date. (1) * * * * * * * * (g) For definitions in Board of Patent § 1.59—for expungement of (ii) Board of Patent Appeals and information. Interferences. See § 41.10 of this title. Appeals and Interferences proceedings, § 1.84—for accepting color drawings Notices of appeal, appeal briefs, reply see part 41 of this title. or photographs. briefs, requests for oral hearing, as well * * * * * § 1.91—for entry of a model or as all other correspondence in an I 8. In § 1.11, revise paragraph (e) to read exhibit. application or a patent involved in an as follows: appeal to the Board for which an § 1.102—to make an application address is not otherwise specified, § 1.11 Files open to the public. special. should be addressed as set out in * * * * * § 1.103(a)—to suspend action in an paragraph (a)(1)(i) of this section. (e) Except as prohibited in § 41.6(b), application. § 1.138(c)—to expressly abandon an * * * * * the file of any interference is open to public inspection and copies of the file application to avoid publication. I 3. In § 1.4, revise paragraph (a)(2) to may be obtained upon payment of the § 1.182—for decision on a question read as follows: fee therefor. not specifically provided for. § 1.4 Nature of correspondence and * * * * * § 1.183—to suspend the rules. signature requirements. I 9. Amend § 1.14 by revising paragraph § 1.295—for review of refusal to (a) * * * (e) to read as follows: publish a statutory invention (2) Correspondence in and relating to registration. a particular application or other § 1.14 Patent applications preserved in § 1.313—to withdraw an application proceeding in the Office. See confidence. from issue. particularly the rules relating to the * * * * * § 1.314—to defer issuance of a patent. filing, processing, or other proceedings (e) Decisions by the Director. Any § 1.377—for review of decision of national applications in subpart B, decision by the Director that would not refusing to accept and record payment §§ 1.31 to 1.378; of international otherwise be open to public inspection of a maintenance fee filed prior to applications in subpart C, §§ 1.401 to may be published or made available for expiration of a patent. 1.499; of ex parte reexaminations of public inspection if: § 1.378(e)—for reconsideration of patents in subpart D, §§ 1.501 to 1.570; (1) The Director believes the decision decision on petition refusing to accept of extension of patent term in subpart F, involves an interpretation of patent laws delayed payment of maintenance fee in §§ 1.710 to 1.785; of inter partes or regulations that would be of an expired patent. reexaminations of patents in subpart H, precedential value; and § 1.741(b)—to accord a filing date to §§ 1.902 to 1.997; and of the Board of (2) The applicant is given notice and an application under § 1.740 for Patent Appeals and Interferences in part an opportunity to object in writing extension of a patent term. 41 of this title. within two months on the ground that § 5.12—for expedited handling of a * * * * * the decision discloses a trade secret or foreign filing license. other confidential information. Any § 5.15—for changing the scope of a § 1.5 [Amended] objection must identify the deletions in license. I the text of the decision considered 4. Remove and reserve § 1.5(e). § 5.25—for retroactive license. I necessary to protect the information, or 5. Amend § 1.6 by revising paragraph § 104.3—for waiver of a rule in Part (d)(9) to read as follows: explain why the entire decision must be withheld from the public to protect such 104 of this title. § 1.6 Receipt of correspondence. information. An applicant or party will * * * * * * * * * * be given time, not less than twenty days, I 11. Revise § 1.36 to read as follows:
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§ 1.36 Revocation of power of attorney; § 1.48 Correction of inventorship in a application, the application may be withdrawal of patent attorney or agent. patent application, other than a reissue amended to add claims to the subject application, pursuant to 35 U.S.C. 116. (a) A power of attorney, pursuant to matter and name the correct inventors (a) Nonprovisional application after § 1.32(b), may be revoked at any stage in for the application. Amendment of the oath/declaration filed. If the inventive the proceedings of a case by an inventorship requires: entity is set forth in error in an executed applicant for patent (§ 1.41(b)) or an (1) A request to correct the § 1.63 oath or declaration in a assignee of the entire interest of the inventorship that sets forth the desired nonprovisional application, and such applicant. A power of attorney to the inventorship change; error arose without any deceptive patent practitioners associated with a (2) A statement from each person intention on the part of the person Customer Number will be treated as a being added as an inventor that the named as an inventor in error or on the request to revoke any powers of attorney addition is necessitated by amendment part of the person who through error previously given. Fewer than all of the of the claims and that the inventorship was not named as an inventor, the applicants (or by fewer than the error occurred without deceptive inventorship of the nonprovisional assignee of the entire interest of the intention on his or her part; application may be amended to name applicant) may only revoke the power of (3) An oath or declaration by the only the actual inventor or inventors. attorney upon a showing of sufficient actual inventors as required by § 1.63 or Amendment of the inventorship cause, and payment of the petition fee as permitted by §§ 1.42, 1.43, or § 1.47; requires: (4) The processing fee set forth in set forth in § 1.17(h). A registered patent (1) A request to correct the § 1.17(i); and attorney or patent agent will be notified inventorship that sets forth the desired (5) If an assignment has been executed of the revocation of the power of inventorship change; attorney. Where power of attorney is (2) A statement from each person by any of the original named inventors, given to the patent practitioners being added as an inventor and from the written consent of the assignee (see associated with a Customer Number each person being deleted as an § 3.73(b) of this chapter). (§ 1.32(c)(2)), the practitioners so inventor that the error in inventorship * * * * * appointed will also be notified of the occurred without deceptive intention on (i) Correction of inventorship in revocation of the power of attorney his or her part; patent. See § 1.324 for correction of when the power of attorney to all of the (3) An oath or declaration by the inventorship in a patent. practitioners associated with the actual inventor or inventors as required (j) Correction of inventorship in a Customer Number is revoked. The by § 1.63 or as permitted by §§ 1.42, 1.43 contested case before the Board of notice of revocation will be mailed to or § 1.47; Patent Appeals and Interferences. In a the correspondence address for the (4) The processing fee set forth in contested case under part 41, subpart D, application (§ 1.33) in effect before the § 1.17(i); and of this title, a request for correction of revocation. An assignment will not of (5) If an assignment has been executed an application must be in the form of a itself operate as a revocation of a power by any of the original named inventors, motion under § 41.121(a)(2) of this title previously given, but the assignee of the the written consent of the assignee (see and must comply with the requirements entire interest of the applicant may § 3.73(b) of this chapter). of this section. revoke previous powers of attorney and (b) Nonprovisional application—fewer I 13. In § 1.55, revise paragraphs (a)(3) give another power of attorney of the inventors due to amendment or and (a)(4) to read as follows: assignee’s own selection as provided in cancellation of claims. If the correct § 1.32(b). inventors are named in a nonprovisional § 1.55 Claim for foreign priority. (b) A registered patent attorney or application, and the prosecution of the (a) * * * patent agent who has been given a nonprovisional application results in (3) The Office may require that the power of attorney pursuant to § 1.32(b) the amendment or cancellation of claim for priority and the certified copy may withdraw as attorney or agent of claims so that fewer than all of the of the foreign application be filed earlier record upon application to and approval currently named inventors are the actual than provided in paragraphs (a)(1) or by the Director. The applicant or patent inventors of the invention being claimed (a)(2) of this section: owner will be notified of the withdrawal in the nonprovisional application, an (i) When the application becomes of the registered patent attorney or amendment must be filed requesting involved in an interference (see § 41.202 patent agent. Where power of attorney is deletion of the name or names of the of this title), person or persons who are not inventors given to the patent practitioners (ii) When necessary to overcome the of the invention being claimed. associated with a Customer Number, a date of a reference relied upon by the Amendment of the inventorship request to delete all of the patent examiner, or requires: practitioners associated with the (iii) When deemed necessary by the Customer Number may not be granted if (1) A request, signed by a party set forth in § 1.33(b), to correct the examiner. an applicant has given power of (4)(i) An English language translation attorney to the patent practitioners inventorship that identifies the named inventor or inventors being deleted and of a non-English language foreign associated with the Customer Number application is not required except: in an application that has an Office acknowledges that the inventor’s invention is no longer being claimed in (A) When the application is involved action to which a reply is due, but in an interference (see § 41.202 of this insufficient time remains for the the nonprovisional application; and (2) The processing fee set forth in title), applicant to file a reply. See § 41.5 of (B) When necessary to overcome the this title for withdrawal during § 1.17(i). (c) Nonprovisional application— date of a reference relied upon by the proceedings before the Board of Patent inventors added for claims to previously examiner, or Appeals and Interferences. unclaimed subject matter. If a (C) When specifically required by the I 12. Amend § 1.48 by revising nonprovisional application discloses examiner. paragraphs (a), (b), (c) and (i), and adding unclaimed subject matter by an inventor (ii) If an English language translation paragraph (j), to read as follows: or inventors not named in the is required, it must be filed together
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with a statement that the translation of (§ 41.31 of this title), or to amendment proceeding from its condition as subject the certified copy is accurate. as specified in § 1.114 or § 1.116. to appeal or to save the application from * * * * * Petition may be taken to the Director in abandonment under § 1.135, or the I 14. In § 1.59, revise paragraph (a)(1) to the case of objections or requirements reexamination prosecution from read as follows: not involved in the rejection of any termination under § 1.550(d) or claim (§ 1.181). Reply to a final rejection § 1.957(b) or limitation of further § 1.59 Expungement of information or or action must comply with § 1.114 or prosecution under § 1.957(c). copy of papers in application file. paragraph (c) of this section. For final (d)(1) Notwithstanding the provisions (a)(1) Information in an application actions in an inter partes reexamination of paragraph (b) of this section, no will not be expunged, except as filed under § 1.913, see § 1.953. amendment other than canceling claims, provided in paragraph (b) of this section * * * * * where such cancellation does not affect or § 41.7(a) of this title. I 18. In § 1.114, revise paragraph (d) to the scope of any other pending claim in * * * * * read as follows: the proceeding, can be made in an inter partes reexamination proceeding after I 15. In § 1.103, revise paragraph (g) to § 1.114 Request for continued the right of appeal notice under § 1.953 read as follows: examination. except as provided in § 1.981 or as § 1.103 Suspension of action by the Office. * * * * * permitted by § 41.77(b)(1) of this title. (d) If an applicant timely files a (2) Notwithstanding the provisions of * * * * * submission and fee set forth in § 1.17(e), paragraph (b) of this section, an (g) Statutory invention registration. the Office will withdraw the finality of amendment made after a final rejection The Office will suspend action by the any Office action and the submission or other final action (§ 1.113) in an ex Office for the entire pendency of an will be entered and considered. If an parte reexamination filed under § 1.510, application if the Office has accepted a applicant files a request for continued or an action closing prosecution request to publish a statutory invention examination under this section after (§ 1.949) in an inter partes registration in the application, except appeal, but prior to a decision on the reexamination filed under § 1.913 may for purposes relating to patent appeal, it will be treated as a request to not cancel claims where such interference proceedings under part 41, withdraw the appeal and to reopen cancellation affects the scope of any subpart D, of this title. prosecution of the application before the other pending claim in the I 16. Revise § 1.112 to read as follows: examiner. An appeal brief (§ 41.37 of reexamination proceeding except as § 1.112 Reconsideration before final this title) or a reply brief (§ 41.41 of this provided in § 1.981 or as permitted by action. title), or related papers, will not be § 41.77(b)(1) of this title. (e) An affidavit or other evidence After reply by applicant or patent considered a submission under this submitted after a final rejection or other owner (§ 1.111 or § 1.945) to a non-final section. final action (§ 1.113) in an application action and any comments by an inter * * * * * or in an ex parte reexamination filed partes reexamination requester (§ 1.947), I 19. Revise § 1.116 to read as follows: under § 1.510, or an action closing the application or the patent under § 1.116 Amendments and affidavits or prosecution (§ 1.949) in an inter partes reexamination will be reconsidered and other evidence after final action and prior to reexamination filed under § 1.913 but again examined. The applicant, or in the appeal. before or on the same date of filing an case of a reexamination proceeding the (a) An amendment after final action appeal (§ 41.31 or § 41.61 of this title), patent owner and any third party must comply with § 1.114 or this may be admitted upon a showing of requester, will be notified if claims are section. good and sufficient reasons why the rejected, objections or requirements (b) After a final rejection or other final affidavit or other evidence is necessary made, or decisions favorable to action (§ 1.113) in an application or in and was not earlier presented. patentability are made, in the same an ex parte reexamination filed under (f) Notwithstanding the provisions of manner as after the first examination § 1.510, or an action closing prosecution paragraph (e) of this section, no affidavit (§ 1.104). Applicant or patent owner (§ 1.949) in an inter partes or other evidence can be made in an may reply to such Office action in the reexamination filed under § 1.913, but inter partes reexamination proceeding same manner provided in § 1.111 or before or on the same date of filing an after the right of appeal notice under § 1.945, with or without amendment, appeal (§ 41.31 or § 41.61 of this title): § 1.953 except as provided in § 1.981 or unless such Office action indicates that (1) An amendment may be made as permitted by § 41.77(b)(1) of this title. it is made final (§ 1.113) or an appeal canceling claims or complying with any (g) After decision on appeal, (§ 41.31 of this title) has been taken requirement of form expressly set forth amendments, affidavits and other (§ 1.116), or in an inter partes in a previous Office action; evidence can only be made as provided reexamination, that it is an action (2) An amendment presenting rejected in §§ 1.198 and 1.981, or to carry into closing prosecution (§ 1.949) or a right claims in better form for consideration effect a recommendation under of appeal notice (§ 1.953). on appeal may be admitted; or § 41.50(c) of this title. I 17. In § 1.113, revise paragraph (a) to (3) An amendment touching the I 20. In § 1.131, revise paragraph (a)(1) to read as follows: merits of the application or patent under read as follows: reexamination may be admitted upon a § 1.113 Final rejection or action. showing of good and sufficient reasons § 1.131 Affidavit or declaration of prior (a) On the second or any subsequent why the amendment is necessary and invention. examination or consideration by the was not earlier presented. (a) * * * examiner the rejection or other action (c) The admission of, or refusal to (1) The rejection is based upon a U.S. may be made final, whereupon admit, any amendment after a final patent or U.S. patent application applicant’s, or for ex parte rejection, a final action, an action publication of a pending or patented reexaminations filed under § 1.510, closing prosecution, or any related application to another or others which patent owner’s reply is limited to appeal proceedings will not operate to relieve claims the same patentable invention as in the case of rejection of any claim the application or reexamination defined in § 41.203(a) of this title, in
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which case an applicant may suggest an must be filed on or before the day on (ii) Where the nature of the decision interference pursuant to § 41.202(a) of which such reply is due, but the mere requires further action by the examiner. this title; or filing of such a request will not affect (2) The date of termination of * * * * * any extension under this paragraph. In proceedings on an application is the I 21. In § 1.136, revise paragraphs (a)(1), no situation can any extension carry the date on which the appeal is dismissed (a)(2), and (b) to read as follows: date on which reply is due beyond the or the date on which the time for appeal maximum time period set by statute. to the U.S. Court of Appeals for the § 1.136 Extensions of time. See § 1.304 for extensions of time to Federal Circuit or review by civil action (a)(1) If an applicant is required to appeal to the U.S. Court of Appeals for (§ 1.304) expires in the absence of reply within a nonstatutory or shortened the Federal Circuit or to commence a further appeal or review. If an appeal to statutory time period, applicant may civil action; § 1.550(c) for extensions of the U.S. Court of Appeals for the extend the time period for reply up to time in ex parte reexamination Federal Circuit or a civil action has been the earlier of the expiration of any proceedings; and § 1.956 for extensions filed, proceedings on an application are maximum period set by statute or five of time in inter partes reexamination considered terminated when the appeal months after the time period set for proceedings. or civil action is terminated. A civil reply, if a petition for an extension of * * * * * action is terminated when the time to time and the fee set in § 1.17(a) are filed, I 22. In § 1.181, revise paragraph (a)(3) to appeal the judgment expires. An appeal unless: read as follows: to the U.S. Court of Appeals for the (i) Applicant is notified otherwise in Federal Circuit, whether from a decision an Office action; § 1.181 Petition to the Director. of the Board or a judgment in a civil (ii) The reply is a reply brief (a) * * * action, is terminated when the mandate submitted pursuant to § 41.41 of this (3) To invoke the supervisory is issued by the Court. title; authority of the Director in appropriate I 26. Revise § 1.198 to read as follows: (iii) The reply is a request for an oral circumstances. For petitions involving hearing submitted pursuant to § 41.47(a) action of the Board of Patent Appeals § 1.198 Reopening after a final decision of and Interferences, see § 41.3 of this title. the Board of Patent Appeals and of this title; Interferences. (iv) The reply is to a decision by the * * * * * When a decision by the Board of Board of Patent Appeals and I 23. Revise § 1.191 to read as follows: Interferences pursuant to § 1.304 or to Patent Appeals and Interferences on § 41.50 or § 41.52 of this title; or § 1.191 Appeal to Board of Patent Appeals appeal has become final for judicial (v) The application is involved in a and Interferences. review, prosecution of the proceeding contested case (§ 41.101(a) of this title). Appeals to the Board of Patent before the primary examiner will not be (2) The date on which the petition Appeals and Interferences under 35 reopened or reconsidered by the and the fee have been filed is the date U.S.C. 134(a) and (b) are conducted primary examiner except under the for purposes of determining the period according to part 41 of this title. provisions of § 1.114 or § 41.50 of this of extension and the corresponding title without the written authority of the §§ 1.192, 1.193, 1.194, 1.195, and 1.196 Director, and then only for the amount of the fee. The expiration of the [Removed and reserved]. time period is determined by the consideration of matters not already amount of the fee paid. A reply must be I 24. Remove and reserve §§ 1.192 adjudicated, sufficient cause being filed prior to the expiration of the through 1.196. shown. period of extension to avoid I 25. Revise § 1.197 to read as follows: I 27. In § 1.248, revise paragraph (c) to read as follows: abandonment of the application § 1.197 Return of jurisdiction from the (§ 1.135), but in no situation may an Board of Patent Appeals and Interferences; § 1.248 Service of papers; manner of applicant reply later than the maximum termination of proceedings. service; proof of service in cases other than time period set by statute, or be granted (a) Return of jurisdiction from the interferences. an extension of time under paragraph Board of Patent Appeals and * * * * * (b) of this section when the provisions Interferences. Jurisdiction over an (c) See § 41.105(f) of this title for of this paragraph are available. See application or patent under ex parte service of papers in contested cases § 1.304 for extensions of time to appeal reexamination proceeding passes to the before the Board of Patent Appeals and to the U.S. Court of Appeals for the examiner after a decision by the Board Interferences. Federal Circuit or to commence a civil of Patent Appeals and Interferences I 28. In § 1.292, revise paragraphs (a) action; § 1.550(c) for extensions of time upon transmittal of the file to the and (c) to read as follows: in ex parte reexamination proceedings, examiner, subject to appellant’s right of § 1.956 for extensions of time in inter appeal or other review, for such further § 1.292 Public use proceedings. partes reexamination proceedings; and action by appellant or by the examiner, (a) When a petition for the institution §§ 41.4(a) and 41.121(a)(3) of this title as the condition of the application or of public use proceedings, supported by for extensions of time in contested cases patent under ex parte reexamination affidavits or declarations is found, on before the Board of Patent Appeals and proceeding may require, to carry into reference to the examiner, to make a Interferences. effect the decision of the Board of Patent prima facie showing that the invention * * * * * Appeals and Interferences. claimed in an application believed to be (b) When a reply cannot be filed (b) Termination of proceedings. (1) on file had been in public use or on sale within the time period set for such reply Proceedings on an application are more than one year before the filing of and the provisions of paragraph (a) of considered terminated by the dismissal the application, a hearing may be had this section are not available, the period of an appeal or the failure to timely file before the Director to determine for reply will be extended only for an appeal to the court or a civil action whether a public use proceeding should sufficient cause and for a reasonable (§ 1.304) except: be instituted. If instituted, the Director time specified. Any request for an (i) Where claims stand allowed in an may designate an appropriate official to extension of time under this paragraph application; or conduct the public use proceeding,
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including the setting of times for taking two months from the date of the petition to correct inventorship of a testimony, which shall be taken as decision of the Board of Patent Appeals patent involved in an interference must provided by part 41, subpart D, of this and Interferences. If a request for comply with the requirements of this title. The petitioner will be heard in the rehearing or reconsideration of the section and must be accompanied by a proceedings but after decision therein decision is filed within the time period motion under § 41.121(a)(2) or will not be heard further in the provided under § 41.52(a), § 41.79(a), or § 41.121(a)(3) of this title. prosecution of the application for § 41.127(d) of this title, the time for * * * * * patent. filing an appeal or commencing a civil (c) For correction of inventorship in * * * * * action shall expire two months after an application, see §§ 1.48 and 1.497. (c) A petition for institution of public action on the request. In contested cases (d) In a contested case before the use proceedings shall not be filed by a before the Board of Patent Appeals and Board of Patent Appeals and party to an interference as to an Interferences, the time for filing a cross- Interferences under part 41, subpart D, application involved in the interference. appeal or cross-action expires: of this title, a request for correction of Public use and on sale issues in an (i) Fourteen days after service of the a patent must be in the form of a motion interference shall be raised by a motion notice of appeal or the summons and under § 41.121(a)(2) or § 41.121(a)(3) of under § 41.121(a)(1) of this title. complaint; or this title. (ii) Two months after the date of * * * * * I 36. In § 1.565, revise paragraph (e) to decision of the Board of Patent Appeals I read as follows: 29. In § 1.295, revise paragraph (b) to and Interferences, whichever is later. read as follows: (2) The time periods set forth in this § 1.565 Concurrent Office proceedings § 1.295 Review of decision finally refusing section are not subject to the provisions which include an ex parte reexamination to publish a statutory invention registration. of § 1.136, § 1.550(c), or § 1.956, or of proceeding. * * * * * § 41.4 of this title. * * * * * (b) Any requester who is dissatisfied * * * * * (e) If a patent in the process of ex with a decision finally rejecting claims I 33. In § 1.322, revise paragraph (a)(3) to parte reexamination is or becomes pursuant to 35 U.S.C. 112 may obtain read as follows: involved in an interference, the Director review of the decision by filing an may suspend the reexamination or the § 1.322 Certificate of correction of Office interference. The Director will not appeal to the Board of Patent Appeals mistake. and Interferences pursuant to § 41.31 of consider a request to suspend an this title. If the decision rejecting claims (a) * * * interference unless a motion (3) If the request relates to a patent pursuant to 35 U.S.C. 112 is reversed, (§ 41.121(a)(3) of this title) to suspend involved in an interference, the request the request for a statutory invention the interference has been presented to, must comply with the requirements of registration will be approved and the and denied by, an administrative patent this section and be accompanied by a registration published if all of the other judge, and the request is filed within ten motion under § 41.121(a)(2) or provisions of § 1.293 and this section (10) days of a decision by an § 41.121(a)(3) of this title. are met. administrative patent judge denying the * * * * * motion for suspension or such other * * * * * I time as the administrative patent judge I 34. Revise § 1.323 to read as follows: 30. In § 1.302, revise paragraph (b) to may set. For concurrent inter partes read as follows: § 1.323 Certificate of correction of reexamination and interference of a applicant’s mistake. § 1.302 Notice of appeal. patent, see § 1.993. The Office may issue a certificate of * * * * * correction under the conditions §§ 1.601 through 1.690 (Subpart E) (b) In interferences, the notice must be specified in 35 U.S.C. 255 at the request [Removed] served as provided in § 41.106(f) of this of the patentee or the patentee’s I 37. Remove and reserve subpart E of title. assignee, upon payment of the fee set part 1. * * * * * forth in § 1.20(a). If the request relates I 38. In § 1.701, revise paragraph I 31. In § 1.303, revise paragraph (c) to to a patent involved in an interference, (c)(2)(ii) to read as follows: read as follows: the request must comply with the requirements of this section and be § 1.701 Extension of patent term due to § 1.303 Civil action under 35 U.S.C. 145, accompanied by a motion under examination delay under the Uruguay 146, 306. § 41.121(a)(2) or § 41.121(a)(3) of this Round Agreements Act (original applications, other than designs, filed on or * * * * * title. (c) A notice of election under 35 after June 8, 1995, and before May 29, I 35. Amend § 1.324 to revise paragraphs U.S.C. 141 to have all further 2000). (a) and (c), and to add paragraph (d), to proceedings on review conducted as * * * * * read as follows: provided in 35 U.S.C. 146 must be filed (c) * * * with the Office of the Solicitor and § 1.324 Correction of inventorship in (2) * * * served as provided in § 41.106(f) of this patent, pursuant to 35 U.S.C. 256. (ii) The number of days, if any, in the title. (a) Whenever through error a person period beginning on the date of mailing of an examiner’s answer under § 41.39 * * * * * is named in an issued patent as the of this title in the application under I inventor, or through error an inventor is 32. In § 1.304, revise paragraphs (a)(1) secrecy order and ending on the date the and (a)(2) to read as follows: not named in an issued patent and such error arose without any deceptive secrecy order and any renewal thereof § 1.304 Time for appeal or civil action. intention on his or her part, the Director was removed; (a)(1) The time for filing the notice of may, on petition, or on order of a court * * * * * appeal to the U.S. Court of Appeals for before which such matter is called in I 39. In § 1.703, revise paragraphs (a)(4), the Federal Circuit (§ 1.302) or for question, issue a certificate naming only (b)(3)(ii), (b)(4), (d)(2), and (e) to read as commencing a civil action (§ 1.303) is the actual inventor or inventors. A follows:
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§ 1.703 Period of adjustment of patent (c) * * * I 44. Revise § 1.981 to read as follows: term due to examination delay. (9) Submission of an amendment or (a) * * * other paper after a decision by the Board § 1.981 Reopening after a final decision of (4) The number of days, if any, in the the Board of Patent Appeals and of Patent Appeals and Interferences, Interferences. period beginning on the day after the other than a decision designated as date that is four months after the date containing a new ground of rejection When a decision by the Board of an appeal brief in compliance with under § 41.50(b) of this title or statement Patent Appeals and Interferences on § 41.37 of this title was filed and ending under § 41.50(c) of this title, or a appeal has become final for judicial on the date of mailing of any of an decision by a Federal court, less than review, prosecution of the inter partes examiner’s answer under § 41.39 of this one month before the mailing of an reexamination proceeding will not be title, an action under 35 U.S.C. 132, or Office action under 35 U.S.C. 132 or reopened or reconsidered by the a notice of allowance under 35 U.S.C. notice of allowance under 35 U.S.C. 151 primary examiner except under the 151, whichever occurs first; that requires the mailing of a provisions of § 41.77 of this title without supplemental Office action or the written authority of the Director, * * * * * and then only for the consideration of (b) * * * supplemental notice of allowance, in (3) * * * which case the period of adjustment set matters not already adjudicated, (ii) The number of days, if any, in the forth in § 1.703 shall be reduced by the sufficient cause being shown. period beginning on the date of mailing lesser of: I 45. Revise § 1.993 to read as follows: of an examiner’s answer under § 41.39 (i) The number of days, if any, § 1.993 Suspension of concurrent of this title in the application under beginning on the day after the mailing interference and inter partes reexamination secrecy order and ending on the date the date of the original Office action or proceeding. secrecy order was removed; notice of allowance and ending on the If a patent in the process of inter * * * * * mailing date of the supplemental Office partes reexamination is or becomes (4) The number of days, if any, in the action or notice of allowance; or involved in an interference, the Director period beginning on the date on which (ii) Four months; may suspend the inter partes a notice of appeal to the Board of Patent * * * * * reexamination or the interference. The Appeals and Interferences was filed I 41. Revise § 1.959 to read as follows: Director will not consider a request to under 35 U.S.C. 134 and § 41.31 of this suspend an interference unless a motion title and ending on the date of the last § 1.959 Appeal in inter partes under § 41.121(a)(3) of this title to reexamination. decision by the Board of Patent Appeals suspend the interference has been and Interferences or by a Federal court Appeals to the Board of Patent presented to, and denied by, an in an appeal under 35 U.S.C. 141 or a Appeals and Interferences under 35 administrative patent judge and the civil action under 35 U.S.C. 145, or on U.S.C. 134(c) are conducted according request is filed within ten (10) days of the date of mailing of either an action to part 41 of this title. a decision by an administrative patent under 35 U.S.C. 132, or a notice of §§ 1.961, 1.962, 1.963, 1.965, 1.967, 1.969, judge denying the motion for allowance under 35 U.S.C. 151, 1.971, 1.973, 1.975, and 1.977 [Removed suspension or such other time as the whichever occurs first, if the appeal did and reserved] administrative patent judge may set. not result in a decision by the Board of I Patent Appeals and Interferences. 42. Remove and reserve §§ 1.961 PART 5—SECRECY OF CERTAIN through 1.977. INVENTIONS AND LICENSES TO * * * * * I (d) * * * 43. Revise § 1.979 to read as follows: EXPORT AND FILE APPLICATIONS IN (2) The number of days, if any, in the § 1.979 Return of Jurisdiction from the FOREIGN COUNTRIES period beginning on the date of mailing Board of Patent Appeals and Interferences; of an examiner’s answer under § 41.39 termination of proceedings. I 45a. The authority citation for part 5 of this title in the application under (a) Jurisdiction over an inter partes continues to read as follows: secrecy order and ending on the date the reexamination proceeding passes to the Authority: 35 U.S.C. 2(b)(2), 41, 181–188, secrecy order was removed; examiner after a decision by the Board as amended by the Patent Law Foreign Filing * * * * * of Patent Appeals and Interferences Amendments Act of 1988, Pub. L. 100–418, (e) The period of adjustment under upon transmittal of the file to the 102 Stat. 1567; the Arms Export Control Act, § 1.702(e) is the sum of the number of examiner, subject to each appellant’s as amended, 22 U.S.C. 2571 et seq.; the Atomic Energy Act of 1954, as amended, 42 days, if any, in the period beginning on right of appeal or other review, for such U.S.C. 2011 et seq.; the Nuclear Non the date on which a notice of appeal to further action as the condition of the Proliferation Act of 1978; 22 U.S.C. 3201 et the Board of Patent Appeals and inter partes reexamination proceeding seq.; and the delegations in the regulations Interferences was filed under 35 U.S.C. may require, to carry into effect the under these Acts to the Director (15 CFR 134 and § 41.31 of this title and ending decision of the Board of Patent Appeals 370.10(j), 22 CFR 125.04, and 10 CFR 810.7). on the date of a final decision in favor and Interferences. I 46. In § 5.3, revise paragraph (b) to read of the applicant by the Board of Patent (b) Upon judgment in the appeal as follows: Appeals and Interferences or by a before the Board of Patent Appeals and Federal court in an appeal under 35 Interferences, if no further appeal has § 5.3 Prosecution of application under U.S.C. 141 or a civil action under 35 been taken (§ 1.983), the inter partes secrecy orders; withholding patent. U.S.C. 145. reexamination proceeding will be * * * * * * * * * * terminated and the Director will issue a (b) An interference will not be I 40. In § 1.704, revise paragraph (c)(9) to certificate under § 1.997 terminating the declared involving a national read as follows: proceeding. If an appeal to the U.S. application under secrecy order. An Court of Appeals for the Federal Circuit applicant whose application is under § 1.704 Reduction of period of adjustment has been filed, that appeal is considered secrecy order may suggest an of patent term. terminated when the mandate is issued interference (§ 41.202(a) of this title), * * * * * by the Court. but the Office will not act on the request
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while the application remains under a 41.20 Fees. 41.206 Common interests in the invention. 41.207 Presumptions. secrecy order. Subpart B—Ex Parte Appeals 41.208 Content of substantive and * * * * * 41.30 Definitions. responsive motions. 41.31 Appeal to Board. PART 10—REPRESENTATIVE OF 41.33 Amendments and affidavits or other Subpart A—General Provisions OTHERS BEFORE THE PATENT AND evidence after appeal. TRADEMARK OFFICE 41.35 Jurisdiction over appeal. § 41.1 Policy. 41.37 Appeal brief. (a) Scope. Part 41 governs proceedings I 46a. The authority citation for part 10 41.39 Examiner’s answer. before the Board of Patent Appeals and continues to read as follows: 41.41 Reply brief. 41.43 Examiner’s response to reply brief. Interferences. Sections 1.1 to 1.36 and Authority: 5 U.S.C. 500, 15 U.S.C. 1123; 35 41.47 Oral hearing. 1.181 to 1.183 of this title also apply to U.S.C. 2(b)(2), 31, 32, 41. 41.50 Decisions and other actions by the practice before the Board, as do other I 47. In § 10.23, revise paragraph (c)(7) to Board. sections of part 1 of this title that are read as follows: 41.52 Rehearing. incorporated by reference into part 41. 41.54 Action following decision. (b) Construction. The provisions of § 10.23 Misconduct. Subpart C—Inter Partes Appeals Part 41 shall be construed to secure the * * * * * 41.60 Definitions. just, speedy, and inexpensive resolution (c) * * * 41.61 Notice of appeal and cross appeal to of every proceeding before the Board. (7) Knowingly withholding from the Board. (c) Decorum. Each party must act with Office information identifying a patent 41.63 Amendments and affidavits or other courtesy and decorum in all or patent application of another from evidence after appeal. proceedings before the Board, including which one or more claims have been 41.64 Jurisdiction over appeal in inter interactions with other parties. copied. See § 41.202(a)(1) of this title. partes reexamination. 41.66 Time for filing briefs. § 41.2 Definitions. * * * * * 41.67 Appellant’s brief. 41.68 Respondent’s brief. Unless otherwise clear from the PART 11—REPRESENTATION OF 41.69 Examiner’s answer. context, the following definitions apply OTHERS BEFORE THE PATENT AND 41.71 Rebuttal brief. to proceedings under this part: TRADEMARK OFFICE 41.73 Oral hearing. Affidavit means affidavit, declaration 41.77 Decisions and other actions by the under § 1.68 of this title, or statutory I 47a. The authority citation for part 11 Board. declaration under 28 U.S.C. 1746. A continues to read as follows: 41.79 Rehearing. 41.81 Action following decision. transcript of an ex parte deposition may Authority: 5 U.S.C. 500, 15 U.S.C. 1123; 35 be used as an affidavit in a contested U.S.C. 2(b)(2)(D), 32. Subpart D—Contested Cases case. I 48. In § 11.6, revise paragraph (d) to 41.100 Definitions. Board means the Board of Patent 41.101 Notice of proceeding. read as follows: Appeals and Interferences and includes: 41.102 Completion of examination. (1) For a final Board action: 41.103 Jurisdiction over involved files. § 11.6 Registration of attorneys and (i) In an appeal or contested case, a agents. 41.104 Conduct of contested case. 41.106 Filing and service. panel of the Board. * * * * * 41.108 Lead counsel. (ii) In a proceeding under § 41.3, the (d) Board of Patent Appeals and 41.109 Access to and copies of Office Chief Administrative Patent Judge or Interferences matters. For action by a records. another official acting under an express person who is not registered in a 41.110 Filing claim information. delegation from the Chief proceeding before the Board of Patent 41.120 Notice of basis for relief. Administrative Patent Judge. 41.121 Motions. Appeals and Interferences, see § 41.5(a) (2) For non-final actions, a Board of this title. 41.122 Oppositions and replies. 41.123 Default filing times. member or employee acting with the I 49. Add part 41 to subchapter A to read 41.124 Oral argument. authority of the Board. as follows: 41.125 Decision on motions. Board member means the Under Authority: 35 U.S.C. 2(b)(2), 3(a)(2)(A), 21, 41.126 Arbitration. Secretary of Commerce for Intellectual 23, 32, 41, 134, 135. 41.127 Judgment. Property and Director of the United 41.128 Sanctions. 41.150 Discovery. States Patent and Trademark Office, the PART 41—PRACTICE BEFORE THE Deputy Under Secretary of Commerce BOARD OF PATENT APPEALS AND 41.151 Admissibility. 41.152 Applicability of the Federal Rules of for Intellectual Property and Deputy INTERFERENCES Evidence. Director of the United States Patent and Subpart A—General Provisions 41.153 Records of the Office. Trademark Office, the Commissioner for 41.154 Form of evidence. Patents, the Commissioner for Sec. 41.155 Objection; motion to exclude; Trademarks, and the administrative 41.1 Policy. motion in limine. patent judges. 41.2 Definitions. 41.156 Compelling testimony and 41.3 Petitions. production. Contested case means a Board 41.4 Timeliness. 41.157 Taking testimony. proceeding other than an appeal under 41.5 Counsel. 41.158 Expert testimony; tests and data. 35 U.S.C. 134 or a petition under § 41.3. 41.6 Public availability of Board records. An appeal in an inter partes Subpart E—Patent Interferences 41.7 Management of the record. reexamination is not a contested case. 41.8 Mandatory notices. 41.200 Procedure; pendency. Final means, with regard to a Board 41.9 Action by owner. 41.201 Definitions. 41.10 Correspondence addresses. 41.202 Suggesting an interference. action, final for the purposes of judicial 41.11 Ex parte communications in inter 41.203 Declaration. review. A decision is final only if: partes proceedings. 41.204 Notice of basis for relief. (1) In a panel proceeding. The 41.12 Citation of authority. 41.205 Settlement agreements. decision is rendered by a panel,
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disposes of all issues with regard to the on petition or such other time as the for investigation. See § 10.131 of this party seeking judicial review, and does Board may set. title. not indicate that further action is (2) A party may not file an opposition required; and or a reply to a petition without Board § 41.6 Public availability of Board records. (2) In other proceedings. The decision authorization. (a) Publication. (1) Generally. Any disposes of all issues or the decision Board action is available for public states it is final. § 41.4 Timeliness. inspection without a party’s permission Hearing means consideration of the (a) Extensions of time. Extensions of if rendered in a file open to the public issues of record. Rehearing means time will be granted only on a showing pursuant to § 1.11 of this title or in an reconsideration. of good cause except as otherwise application that has been published in Office means United States Patent and provided by rule. accordance with §§ 1.211 to 1.221 of Trademark Office. (b) Late filings. (1) A late filing that this title. The Office may independently Panel means at least three Board results in either an application publish any Board action that is members acting in a panel proceeding. becoming abandoned or a reexamination available for public inspection. Panel proceeding means a proceeding proceeding becoming terminated under (2) Determination of special in which final action is reserved by §§ 1.550(d) or 1.957(b) or (c) of this title circumstances. Any Board action not statute to at least three Board members, may be revived as set forth in § 1.137 of publishable under paragraph (a)(1) of but includes a non-final portion of such this title. this section may be published or made a proceeding whether administered by a (2) A late filing that does not result in available for public inspection if the panel or not. either an application becoming Director believes that special Party, in this part, means any entity abandoned or a reexamination circumstances warrant publication and participating in a Board proceeding, proceeding becoming terminated under a party does not, within two months other than officers and employees of the §§ 1.550(d) or 1.957(b) or (c) of this title after being notified of the intention to Office, including: will be excused upon a showing of make the action public, object in writing (1) An appellant; excusable neglect or a Board on the ground that the action discloses (2) A participant in a contested case; determination that consideration on the the objecting party’s trade secret or (3) A petitioner; and merits would be in the interest of other confidential information and (4) Counsel for any of the above, justice. states with specificity that such where context permits. (c) Scope. This section governs all information is not otherwise publicly proceedings before the Board, but does available. If the action discloses such § 41.3 Petitions. not apply to filings related to Board information, the party shall identify the (a) Deciding official. Petitions must be proceedings before or after the Board deletions in the text of the action addressed to the Chief Administrative has jurisdiction, such as: considered necessary to protect the Patent Judge. A panel or an (1) Extensions during prosecution (see information. If the affected party administrative patent judge may certify § 1.136 of this title), considers that the entire action must be a question of policy to the Chief (2) Filing of a brief or request for oral withheld from the public to protect such Administrative Patent Judge for hearing (see §§ 41.37, 41.41, 41.47, information, the party must explain decision. The Chief Administrative 41.67, 41.68, 41.71 and 41.73), or why. The party will be given time, not Patent Judge may delegate authority to (3) Seeking judicial review (see less than twenty days, to request decide petitions. §§ 1.301 to 1.304 of this title). reconsideration and seek court review (b) Scope. This section covers before any contested portion of the § 41.5 Counsel. petitions on matters pending before the action is made public over its objection. Board (§§ 41.35, 41.64, 41.103, and While the Board has jurisdiction: (b) Record of proceeding. (1) The 41.205); otherwise, see §§ 1.181 to 1.183 (a) Appearance pro hac vice. The record of a Board proceeding is of this title. The following matters are Board may authorize a person other available to the public unless a patent not subject to petition: than a registered practitioner to appear application not otherwise available to (1) Issues committed by statute to a as counsel in a specific proceeding. the public is involved. panel, and (b) Disqualification. (1) The Board (2) Notwithstanding paragraph (b)(1) (2) In pending contested cases, may disqualify counsel in a specific of this section, after a final Board action procedural issues. See § 41.121(a)(3) and proceeding after notice and an in or judgment in a Board proceeding, § 41.125(c). opportunity to be heard. the record of the Board proceeding will (c) Petition fee. The fee set in (2) A decision to disqualify is not be made available to the public if any § 41.20(a) must accompany any petition final for the purposes of judicial review involved file is or becomes open to the under this section except no fee is until certified by the Chief public under § 1.11 of this title or an required for a petition under this section Administrative Patent Judge. involved application is or becomes seeking supervisory review. (c) Withdrawal. Counsel may not published under §§ 1.211 to 1.221 of (d) Effect on proceeding. The filing of withdraw from a proceeding before the this title. a petition does not stay the time for any Board unless the Board authorizes such other action in a Board proceeding. withdrawal. See § 10.40 of this title § 41.7 Management of the record. (e) Time for action. (1) Except as regarding conditions for withdrawal. (a) The Board may expunge any paper otherwise provided in this part or as the (d) Procedure. The Board may directed to a Board proceeding, or filed Board may authorize in writing, a party institute a proceeding under this section while an application or patent is under may: on its own or a party in a contested case the jurisdiction of the Board, that is not (i) File the petition within 14 calendar may request relief under this section. authorized under this part or in a Board days from the date of the action from (e) Referral to the Director of order, or that is filed contrary to a Board which the party is requesting relief, and Enrollment and Discipline. Possible order. (ii) File any request for violations of the disciplinary rules in (b) A party may not file a paper reconsideration of a petition decision part 10 of this title may be referred to previously filed in the same Board within 14 calendar days of the decision the Office of Enrollment and Discipline proceeding, not even as an exhibit or
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appendix, without Board authorization why it is in the interest of justice to Office, PO Box 1450, Alexandria, or as required by rule. permit the owner of a part interest to act Virginia 22313–1450. in the proceeding. An order granting the § 41.8 Mandatory notices. petition may set conditions on the § 41.11 Ex Parte communications in inter partes proceedings. (a) In an appeal brief (§§ 41.37, 41.67, actions of the parties during the or 41.68) or at the initiation of a proceeding. An ex parte communication about an contested case (§ 41.101), and within 20 inter partes reexamination (subpart C of days of any change during the § 41.10 Correspondence addresses. this part) or about a contested case proceeding, a party must identify: Except as the Board may otherwise (subparts D and E of this part) with a (1) Its real party-in-interest, and direct, Board member, or with a Board (2) Each judicial or administrative (a) Appeals. Correspondence in an employee assigned to the proceeding, is proceeding that could affect, or be application or a patent involved in an not permitted. affected by, the Board proceeding. (b) For contested cases, a party appeal (subparts B and C of this part) § 41.12 Citation of authority. during the period beginning when an seeking judicial review of a Board (a) Citations to authority must appeal docketing notice is issued and proceeding must file a notice with the include: ending when a decision has been Board of the judicial review within 20 (1) For any United States Supreme rendered by the Board, as well as any days of the filing of the complaint or the Court decision, a United States Reports request for rehearing of a decision by notice of appeal. The notice to the Board citation. the Board, shall be mailed to: Board of must include a copy of the complaint or (2) For any decision other than a Patent Appeals and Interferences, notice of appeal. See also §§ 1.301 to United States Supreme Court decision, United States Patent and Trademark 1.304 of this title. parallel citation to both the West Office, PO Box 1450, Alexandria, Reporter System and to the United § 41.9 Action by owner. Virginia 22313–1450. Notices of appeal, States Patents Quarterly whenever the appeal briefs, reply briefs, requests for (a) Entire interest. An owner of the case is published in both. Other parallel oral hearing, as well as all other entire interest in an application or citations are discouraged. correspondence in an application or a patent involved in a Board proceeding (3) Pinpoint citations whenever a patent involved in an appeal to the may act in the proceeding to the specific holding or portion of an Board for which an address is not exclusion of the inventor (see § 3.73(b) authority is invoked. otherwise specified, should be of this title). (b) Non-binding authority should be addressed as set out in § 1.1(a)(1)(i) of (b) Part interest. An owner of a part used sparingly. If the authority is not an this title. interest in an application or patent authority of the Office and is not involved in a Board proceeding may (b) Contested cases. Mailed reproduced in one of the reporters listed petition to act in the proceeding to the correspondence in contested cases in paragraph (a) of this section, a copy exclusion of an inventor or a co-owner. (subpart D of this part) shall be sent to of the authority should be filed with the The petition must show the inability or Mail Stop INTERFERENCE, Board of first paper in which it is cited. refusal of an inventor or co-owner to Patent Appeals and Interferences, prosecute the proceeding or other cause United States Patent and Trademark § 41.20 Fees.
(a) Petition fee. The fee for filing a petition under this part is ...... $130.00 (b) Appeal fees. (1) For filing a notice of appeal from the examiner to the Board: By a small entity (§ 1.27(a) of this title) ...... 165.00 By other than a small entity ...... 330.00 (2) In addition to the fee for filing a notice of appeal, for filing a brief in support of an appeal: By a small entity (§ 1.27(a) of this title) ...... 165.00 By other than a small entity ...... 330.00 (3) For filing a request for an oral hearing before the Board in an appeal under 35 U.S.C. 134: By a small entity (§ 1.27(a) of this title) ...... 145.00 By other than a small entity ...... 290.00
Subpart B—Ex Parte Appeals reexamination proceeding is controlled a notice of appeal accompanied by the by subpart C of this part. fee set forth in § 41.20(b)(1) within the § 41.30 Definitions. time period provided under § 1.134 of In addition to the definitions in § 41.31 Appeal to Board. this title for reply. § 41.2, the following definitions apply to (a) Who may appeal and how to file (3) Every owner of a patent under ex proceedings under this subpart unless an appeal. (1) Every applicant, any of parte reexamination filed under § 1.510 otherwise clear from the context: whose claims has been twice rejected, of this title on or after November 29, Applicant means either the applicant may appeal from the decision of the 1999, any of whose claims has been in a national application for a patent or examiner to the Board by filing a notice finally (§ 1.113 of this title) rejected, the applicant in an application for of appeal accompanied by the fee set may appeal from the decision of the reissue of a patent. forth in § 41.20(b)(1) within the time Owner means the owner of the patent period provided under § 1.134 of this examiner to the Board by filing a notice undergoing ex parte reexamination title for reply. of appeal accompanied by the fee set under § 1.510 of this title. (2) Every owner of a patent under ex forth in § 41.20(b)(1) within the time Proceeding means either a national parte reexamination filed under § 1.510 period provided under § 1.134 of this application for a patent, an application of this title before November 29, 1999, title for reply. for reissue of a patent, or an ex parte any of whose claims has been twice (b) The signature requirement of reexamination proceeding. Appeal to rejected, may appeal from the decision § 1.33 of this title does not apply to a the Board in an inter partes of the examiner to the Board by filing notice of appeal filed under this section.
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(c) An appeal, when taken, must be other appropriate action to permit (c)(1)(vii) of this section, every means taken from the rejection of all claims completion of the file. plus function and step plus function as under rejection which the applicant or (c) Prior to the entry of a decision on permitted by 35 U.S.C. 112, sixth owner proposes to contest. Questions the appeal by the Board, the Director paragraph, must be identified and the relating to matters not affecting the may sua sponte order the proceeding structure, material, or acts described in merits of the invention may be required remanded to the examiner. the specification as corresponding to to be settled before an appeal can be each claimed function must be set forth § 41.37 Appeal brief. considered. with reference to the specification by (d) The time periods set forth in (a)(1) Appellant must file a brief page and line number, and to the paragraphs (a)(1) through (a)(3) of this under this section within two months drawing, if any, by reference characters. section are extendable under the from the date of filing the notice of (vi) Grounds of rejection to be provisions of § 1.136 of this title for appeal under § 41.31. reviewed on appeal. A concise patent applications and § 1.550(c) of this (2) The brief must be accompanied by statement of each ground of rejection title for ex parte reexamination the fee set forth in § 41.20(b)(2). presented for review. proceedings. (b) On failure to file the brief, (vii) Argument. The contentions of accompanied by the requisite fee, appellant with respect to each ground of § 41.33 Amendments and affidavits or within the period specified in paragraph rejection presented for review in other evidence after appeal. (a) of this section, the appeal will stand paragraph (c)(1)(vi) of this section, and (a) Amendments filed after the date of dismissed. the basis therefor, with citations of the filing an appeal pursuant to § 41.31(a)(1) (c)(1) The brief shall contain the statutes, regulations, authorities, and through (a)(3) and prior to the date a following items under appropriate parts of the record relied on. Any brief is filed pursuant to § 41.37 may be headings and in the order indicated in arguments or authorities not included in admitted as provided in § 1.116 of this paragraphs (c)(1)(i) through (c)(1)(x) of the brief or a reply brief filed pursuant title. this section, except that a brief filed by to § 41.41 will be refused consideration (b) Amendments filed on or after the an appellant who is not represented by by the Board, unless good cause is date of filing a brief pursuant to § 41.37 a registered practitioner need only shown. Each ground of rejection must may be admitted: substantially comply with paragraphs be treated under a separate heading. For (1) To cancel claims, where such (c)(1)(i) through (c)(1)(iv) and (c)(1)(vii) each ground of rejection applying to two cancellation does not affect the scope of through (c)(1)(x) of this section: or more claims, the claims may be any other pending claim in the (i) Real party in interest. A statement argued separately or as a group. When proceeding, or identifying by name the real party in multiple claims subject to the same (2) To rewrite dependent claims into interest. ground of rejection are argued as a independent form. (ii) Related appeals and interferences. group by appellant, the Board may (c) All other amendments filed after A statement identifying by application, select a single claim from the group of the date of filing an appeal pursuant to patent, appeal or interference number claims that are argued together to decide § 41.31(a)(1) through (a)(3) will not be all other prior and pending appeals, the appeal with respect to the group of admitted except as permitted by interferences or judicial proceedings claims as to the ground of rejection on §§ 41.39(b)(1), 41.50(a)(2)(i), 41.50(b)(1) known to appellant, the appellant’s the basis of the selected claim alone. and 41.50(c). legal representative, or assignee which Notwithstanding any other provision of (d)(1) An affidavit or other evidence may be related to, directly affect or be this paragraph, the failure of appellant filed after the date of filing an appeal directly affected by or have a bearing on to separately argue claims which pursuant to § 41.31(a)(1) through (a)(3) the Board’s decision in the pending appellant has grouped together shall and prior to the date of filing a brief appeal. Copies of any decisions constitute a waiver of any argument that pursuant to § 41.37 may be admitted if rendered by a court or the Board in any the Board must consider the the examiner determines that the proceeding identified under this patentability of any grouped claim affidavit or other evidence overcomes paragraph must be included in an separately. Any claim argued separately all rejections under appeal and that a appendix as required by paragraph should be placed under a subheading showing of good and sufficient reasons (c)(1)(x) of this section. identifying the claim by number. Claims why the affidavit or other evidence is (iii) Status of claims. A statement of argued as a group should be placed necessary and was not earlier presented the status of all the claims in the under a subheading identifying the has been made. proceeding (e.g., rejected, allowed or claims by number. A statement which (2) All other affidavits or other confirmed, withdrawn, objected to, merely points out what a claim recites evidence filed after the date of filing an canceled) and an identification of those will not be considered an argument for appeal pursuant to § 41.31(a)(1) through claims that are being appealed. separate patentability of the claim. (a)(3) will not be admitted except as (iv) Status of amendments. A (viii) Claims appendix. An appendix permitted by §§ 41.39(b)(1), statement of the status of any containing a copy of the claims involved 41.50(a)(2)(i) and 41.50(b)(1). amendment filed subsequent to final in the appeal. rejection. (ix) Evidence appendix. An appendix § 41.35 Jurisdiction over appeal. (v) Summary of claimed subject containing copies of any evidence (a) Jurisdiction over the proceeding matter. A concise explanation of the submitted pursuant to §§ 1.130, 1.131, passes to the Board upon transmittal of subject matter defined in each of the or 1.132 of this title or of any other the file, including all briefs and independent claims involved in the evidence entered by the examiner and examiner’s answers, to the Board. appeal, which shall refer to the relied upon by appellant in the appeal, (b) If, after receipt and review of the specification by page and line number, along with a statement setting forth proceeding, the Board determines that and to the drawing, if any, by reference where in the record that evidence was the file is not complete or is not in characters. For each independent claim entered in the record by the examiner. compliance with the requirements of involved in the appeal and for each Reference to unentered evidence is not this subpart, the Board may relinquish dependent claim argued separately permitted in the brief. See § 41.33 for jurisdiction to the examiner or take under the provisions of paragraph treatment of evidence submitted after
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appeal. This appendix may also include affidavits (§§ 1.130, 1.131 or 1.132 of § 41.43 Examiner’s response to reply brief. copies of the evidence relied upon by this title) or other evidence. Any (a)(1) After receipt of a reply brief in the examiner as to grounds of rejection amendment or submission of affidavits compliance with § 41.41, the primary to be reviewed on appeal. or other evidence must be relevant to examiner must acknowledge receipt and (x) Related proceedings appendix. An the new ground of rejection. A request entry of the reply brief. In addition, the appendix containing copies of decisions that complies with this paragraph will primary examiner may withdraw the rendered by a court or the Board in any be entered and the application or the final rejection and reopen prosecution proceeding identified pursuant to patent under ex parte reexamination or may furnish a supplemental paragraph (c)(1)(ii) of this section. will be reconsidered by the examiner examiner’s answer responding to any (2) A brief shall not include any new under the provisions of § 1.112 of this new issue raised in the reply brief. or non-admitted amendment, or any title. Any request that prosecution be (2) A supplemental examiner’s answer new or non-admitted affidavit or other reopened under this paragraph will be responding to a reply brief may not evidence. See § 1.116 of this title for treated as a request to withdraw the include a new ground of rejection. amendments, affidavits or other appeal. (b) If a supplemental examiner’s evidence filed after final action but (2) Maintain appeal. Request that the answer is furnished by the examiner, before or on the same date of filing an appeal be maintained by filing a reply appellant may file another reply brief appeal and § 41.33 for amendments, brief as set forth in § 41.41. Such a reply under § 41.41 to any supplemental affidavits or other evidence filed after brief must address each new ground of examiner’s answer within two months the date of filing the appeal. rejection as set forth in § 41.37(c)(1)(vii) from the date of the supplemental (d) If a brief is filed which does not and should follow the other examiner’s answer. comply with all the requirements of requirements of a brief as set forth in (c) Extensions of time under § 1.136(a) paragraph (c) of this section, appellant § 41.37(c). A reply brief may not be of this title for patent applications are will be notified of the reasons for non- accompanied by any amendment, not applicable to the time period set compliance and given a time period affidavit (§§ 1.130, 1.131 or 1.132 of this forth in this section. See § 1.136(b) of within which to file an amended brief. title) or other evidence. If a reply brief this title for extensions of time to reply If appellant does not file an amended filed pursuant to this section is for patent applications and § 1.550(c) of brief within the set time period, or files accompanied by any amendment, this title for extensions of time to reply an amended brief which does not affidavit or other evidence, it shall be for ex parte reexamination proceedings. overcome all the reasons for non- treated as a request that prosecution be § 41.47 Oral hearing. compliance stated in the notification, reopened before the primary examiner the appeal will stand dismissed. under paragraph (b)(1) of this section. (a) An oral hearing should be (e) The time periods set forth in this (c) Extensions of time under § 1.136(a) requested only in those circumstances section are extendable under the of this title for patent applications are in which appellant considers such a provisions of § 1.136 of this title for not applicable to the time period set hearing necessary or desirable for a patent applications and § 1.550(c) of this forth in this section. See § 1.136(b) of proper presentation of the appeal. An title for ex parte reexamination this title for extensions of time to reply appeal decided on the briefs without an proceedings. for patent applications and § 1.550(c) of oral hearing will receive the same this title for extensions of time to reply consideration by the Board as appeals § 41.39 Examiner’s answer. for ex parte reexamination proceedings. decided after an oral hearing. (a)(1) The primary examiner may, (b) If appellant desires an oral within such time as may be directed by § 41.41 Reply brief. hearing, appellant must file, as a the Director, furnish a written answer to (a)(1) Appellant may file a reply brief separate paper captioned ‘‘REQUEST the appeal brief including such to an examiner’s answer within two FOR ORAL HEARING,’’ a written explanation of the invention claimed months from the date of the examiner’s request for such hearing accompanied and of the references relied upon and answer. by the fee set forth in § 41.20(b)(3) grounds of rejection as may be (2) A reply brief shall not include any within two months from the date of the necessary, supplying a copy to new or non-admitted amendment, or examiner’s answer or supplemental appellant. If the primary examiner any new or non-admitted affidavit or examiner’s answer. determines that the appeal does not other evidence. See § 1.116 of this title (c) If no request and fee for oral comply with the provisions of §§ 41.31 for amendments, affidavits or other hearing have been timely filed by and 41.37 or does not relate to an evidence filed after final action but appellant as required by paragraph (b) of appealable action, the primary examiner before or on the same date of filing an this section, the appeal will be assigned shall make such determination of appeal and § 41.33 for amendments, for consideration and decision on the record. affidavits or other evidence filed after briefs without an oral hearing. (2) An examiner’s answer may the date of filing the appeal. (d) If appellant has complied with all include a new ground of rejection. (b) A reply brief that is not in the requirements of paragraph (b) of this (b) If an examiner’s answer contains a compliance with paragraph (a) of this section, a date for the oral hearing will rejection designated as a new ground of section will not be considered. be set, and due notice thereof given to rejection, appellant must within two Appellant will be notified if a reply appellant. If an oral hearing is held, an months from the date of the examiner’s brief is not in compliance with oral argument may be presented by, or answer exercise one of the following paragraph (a) of this section. on behalf of, the primary examiner if two options to avoid sua sponte (c) Extensions of time under § 1.136(a) considered desirable by either the dismissal of the appeal as to the claims of this title for patent applications are primary examiner or the Board. A subject to the new ground of rejection: not applicable to the time period set hearing will be held as stated in the (1) Reopen prosecution. Request that forth in this section. See § 1.136(b) of notice, and oral argument will prosecution be reopened before the this title for extensions of time to reply ordinarily be limited to twenty minutes primary examiner by filing a reply for patent applications and § 1.550(c) of for appellant and fifteen minutes for the under § 1.111 of this title with or this title for extensions of time to reply primary examiner unless otherwise without amendment or submission of for ex parte reexamination proceedings. ordered.
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(e)(1) Appellant will argue first and supplemental examiner’s answer. A amendment in conformity with such may reserve time for rebuttal. At the oral request that complies with this statement will overcome the specific hearing, appellant may only rely on paragraph will be entered and the rejection. An examiner may reject a evidence that has been previously application or the patent under ex parte claim so-amended, provided that the entered and considered by the primary reexamination will be reconsidered by rejection constitutes a new ground of examiner and present argument that has the examiner under the provisions of rejection. been relied upon in the brief or reply § 1.112 of this title. Any request that (d) The Board may order appellant to brief except as permitted by paragraph prosecution be reopened under this additionally brief any matter that the (e)(2) of this section. The primary paragraph will be treated as a request to Board considers to be of assistance in examiner may only rely on argument withdraw the appeal. reaching a reasoned decision on the and evidence relied upon in an answer (ii) Maintain appeal. Request that the pending appeal. Appellant will be given or a supplemental answer except as appeal be maintained by filing a reply a non-extendable time period within permitted by paragraph (e)(2) of this brief as provided in § 41.41. If such a which to respond to such an order. section. reply brief is accompanied by any Failure to timely comply with the order (2) Upon a showing of good cause, amendment, affidavit or other evidence, may result in the sua sponte dismissal appellant and/or the primary examiner it shall be treated as a request that of the appeal. may rely on a new argument based upon prosecution be reopened before the (e) Whenever a decision of the Board a recent relevant decision of either the examiner under paragraph (a)(2)(i) of includes a remand, that decision shall Board or a Federal Court. this section. not be considered final for judicial (b) Should the Board have knowledge (f) Notwithstanding the submission of review. When appropriate, upon of any grounds not involved in the a request for oral hearing complying conclusion of proceedings on remand appeal for rejecting any pending claim, with this rule, if the Board decides that before the examiner, the Board may it may include in its opinion a statement a hearing is not necessary, the Board enter an order otherwise making its to that effect with its reasons for so will so notify appellant. decision final for judicial review. (g) Extensions of time under § 1.136(a) holding, which statement constitutes a (f) Extensions of time under § 1.136(a) of this title for patent applications are new ground of rejection of the claim. A of this title for patent applications are not applicable to the time periods set new ground of rejection pursuant to this not applicable to the time periods set forth in this section. See § 1.136(b) of paragraph shall not be considered final forth in this section. See § 1.136(b) of this title for extensions of time to reply for judicial review. When the Board this title for extensions of time to reply for patent applications and § 1.550(c) of makes a new ground of rejection, the for patent applications and § 1.550(c) of this title for extensions of time to reply appellant, within two months from the this title for extensions of time to reply for ex parte reexamination proceedings. date of the decision, must exercise one of the following two options with for ex parte reexamination proceedings. § 41.50 Decisions and other actions by the respect to the new ground of rejection § 41.52 Rehearing. Board. to avoid termination of the appeal as to (a)(1) The Board, in its decision, may the rejected claims: (a)(1) Appellant may file a single affirm or reverse the decision of the (1) Reopen prosecution. Submit an request for rehearing within two months examiner in whole or in part on the appropriate amendment of the claims so of the date of the original decision of the grounds and on the claims specified by rejected or new evidence relating to the Board. No request for rehearing from a the examiner. The affirmance of the claims so rejected, or both, and have the decision on rehearing will be permitted, rejection of a claim on any of the matter reconsidered by the examiner, in unless the rehearing decision so grounds specified constitutes a general which event the proceeding will be modified the original decision as to affirmance of the decision of the remanded to the examiner. The new become, in effect, a new decision, and examiner on that claim, except as to any ground of rejection is binding upon the the Board states that a second request ground specifically reversed. The Board examiner unless an amendment or new for rehearing would be permitted. The may also remand an application to the evidence not previously of record is request for rehearing must state with examiner. made which, in the opinion of the particularity the points believed to have (2) If a supplemental examiner’s examiner, overcomes the new ground of been misapprehended or overlooked by answer is written in response to a rejection stated in the decision. Should the Board. Arguments not raised in the remand by the Board for further the examiner reject the claims, appellant briefs before the Board and evidence not consideration of a rejection pursuant to may again appeal to the Board pursuant previously relied upon in the brief and paragraph (a)(1) of this section, the to this subpart. any reply brief(s) are not permitted in appellant must within two months from (2) Request rehearing. Request that the request for rehearing except as the date of the supplemental examiner’s the proceeding be reheard under § 41.52 permitted by paragraphs (a)(2) and (a)(3) answer exercise one of the following by the Board upon the same record. The of this section. When a request for two options to avoid sua sponte request for rehearing must address any rehearing is made, the Board shall dismissal of the appeal as to the claims new ground of rejection and state with render a decision on the request for subject to the rejection for which the particularity the points believed to have rehearing. The decision on the request Board has remanded the proceeding: been misapprehended or overlooked in for rehearing is deemed to incorporate (i) Reopen prosecution. Request that entering the new ground of rejection the earlier opinion reflecting its prosecution be reopened before the and also state all other grounds upon decision for appeal, except for those examiner by filing a reply under § 1.111 which rehearing is sought. portions specifically withdrawn on of this title with or without amendment (c) The opinion of the Board may rehearing, and is final for the purpose of or submission of affidavits (§§ 1.130, include an explicit statement of how a judicial review, except when noted 1.131 or 1.132 of this title) or other claim on appeal may be amended to otherwise in the decision on rehearing. evidence. Any amendment or overcome a specific rejection. When the (2) Upon a showing of good cause, submission of affidavits or other opinion of the Board includes such a appellant may present a new argument evidence must be relevant to the issues statement, appellant has the right to based upon a recent relevant decision of set forth in the remand or raised in the amend in conformity therewith. An either the Board or a Federal Court.
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(3) New arguments responding to a Right of Appeal Notice and paying the the reasons for non-compliance, that new ground of rejection made pursuant fee set forth in § 41.20(b)(1). appellant’s appeal or cross appeal will to § 41.50(b) are permitted. (2) Upon the issuance of a Right of stand dismissed. (b) Extensions of time under § 1.136(a) Appeal Notice under § 1.953 of this title, of this title for patent applications are the requester may appeal to the Board § 41.63 Amendments and affidavits or other evidence after appeal. not applicable to the time period set with respect to any final decision forth in this section. See § 1.136(b) of favorable to the patentability, including (a) Amendments filed after the date of this title for extensions of time to reply any final determination not to make a filing an appeal pursuant to § 41.61 for patent applications and § 1.550(c) of proposed rejection, of any original, canceling claims may be admitted this title for extensions of time to reply proposed amended, or new claim of the where such cancellation does not affect for ex parte reexamination proceedings. patent by filing a notice of appeal the scope of any other pending claim in within the time provided in the Right of the proceeding. § 41.54 Action following decision. Appeal Notice and paying the fee set (b) All other amendments filed after After decision by the Board, the forth in § 41.20(b)(1). the date of filing an appeal pursuant to proceeding will be returned to the (b)(1) Within fourteen days of service § 41.61 will not be admitted except as examiner, subject to appellant’s right of of a requester’s notice of appeal under permitted by § 41.77(b)(1). appeal or other review, for such further paragraph (a)(2) of this section and upon (c) Affidavits or other evidence filed action by appellant or by the examiner, payment of the fee set forth in after the date of filing an appeal as the condition of the proceeding may § 41.20(b)(1), an owner who has not pursuant to § 41.61 will not be admitted require, to carry into effect the decision. filed a notice of appeal may file a notice except as permitted by reopening of cross appeal with respect to the final prosecution under § 41.77(b)(1). Subpart C—Inter Partes Appeals rejection of any claim of the patent. (2) Within fourteen days of service of § 41.64 Jurisdiction over appeal in inter § 41.60 Definitions. an owner’s notice of appeal under partes reexamination. In addition to the definitions in paragraph (a)(1) of this section and upon (a) Jurisdiction over the proceeding § 41.2, the following definitions apply to payment of the fee set forth in passes to the Board upon transmittal of proceedings under this subpart unless § 41.20(b)(1), a requester who has not the file, including all briefs and otherwise clear from the context: filed a notice of appeal may file a notice examiner’s answers, to the Board. Appellant means any party, whether of cross appeal with respect to any final (b) If, after receipt and review of the the owner or a requester, filing a notice decision favorable to the patentability, proceeding, the Board determines that of appeal or cross appeal under § 41.61. including any final determination not to the file is not complete or is not in If more than one party appeals or cross make a proposed rejection, of any compliance with the requirements of appeals, each appealing or cross original, proposed amended, or new this subpart, the Board may relinquish appealing party is an appellant with claim of the patent. jurisdiction to the examiner or take respect to the claims to which his or her (c) The notice of appeal or cross other appropriate action to permit appeal or cross appeal is directed. appeal in the proceeding must identify completion of the file. Filing means filing with a certificate the appealed claim(s) and must be (c) Prior to the entry of a decision on indicating service of the document signed by the owner, the requester, or a the appeal by the Board, the Director under § 1.903 of this title. duly authorized attorney or agent. may sua sponte order the proceeding Owner means the owner of the patent (d) An appeal or cross appeal, when remanded to the examiner. undergoing inter partes reexamination taken, must be taken from all the § 41.66 Time for filing briefs. under § 1.915 of this title. rejections of the claims in a Right of Proceeding means an inter partes Appeal Notice which the patent owner (a) An appellant’s brief must be filed reexamination proceeding. Appeal to proposes to contest or from all the no later than two months from the latest the Board in an ex parte reexamination determinations favorable to filing date of the last-filed notice of proceeding is controlled by subpart B of patentability, including any final appeal or cross appeal or, if any party this part. An inter partes reexamination determination not to make a proposed to the proceeding is entitled to file an proceeding is not a contested case rejection, in a Right of Appeal Notice appeal or cross appeal but fails to timely subject to subpart D. which a requester proposes to contest. do so, no later than two months from Requester means each party, other Questions relating to matters not the expiration of the time for filing (by than the owner, who requested that the affecting the merits of the invention may the last party entitled to do so) such patent undergo inter partes be required to be settled before an notice of appeal or cross appeal. The reexamination under § 1.915 of this title. appeal is decided. time for filing an appellant’s brief or an Respondent means any requester (e) The time periods for filing a notice amended appellant’s brief may not be responding under § 41.68 to the of appeal or cross appeal may not be extended. appellant’s brief of the owner, or the extended. (b) Once an appellant’s brief has been owner responding under § 41.68 to the (f) If a notice of appeal or cross appeal properly filed, any brief must be filed by appellant’s brief of any requester. No is timely filed but does not comply with respondent within one month from the requester may be a respondent to the any requirement of this section, date of service of the appellant’s brief. appellant brief of any other requester. appellant will be notified of the reasons The time for filing a respondent’s brief for non-compliance and given a non- or an amended respondent’s brief may § 41.61 Notice of appeal and cross appeal extendable time period within which to not be extended. to Board. file an amended notice of appeal or (c) The examiner will consider both (a)(1) Upon the issuance of a Right of cross appeal. If the appellant does not the appellant’s and respondent’s briefs Appeal Notice under § 1.953 of this title, then file an amended notice of appeal or and may prepare an examiner’s answer the owner may appeal to the Board with cross appeal within the set time period, under § 41.69. respect to the final rejection of any or files a notice which does not (d) Any appellant may file a rebuttal claim of the patent by filing a notice of overcome all the reasons for non- brief under § 41.71 within one month of appeal within the time provided in the compliance stated in the notification of the date of the examiner’s answer. The
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time for filing a rebuttal brief or an specification by column and line will not be considered an argument for amended rebuttal brief may not be number, and to the drawing(s), if any, separate patentability of the claim. extended. by reference characters. For each (viii) Claims appendix. An appendix (e) No further submission will be independent claim involved in the containing a copy of the claims to be considered and any such submission appeal and for each dependent claim reviewed on appeal. will be treated in accordance with argued separately under the provisions (ix) Evidence appendix. An appendix § 1.939 of this title. of paragraph (c)(1)(vii) of this section, containing copies of any evidence every means plus function and step plus submitted pursuant to §§ 1.130, 1.131, § 41.67 Appellant’s brief. function as permitted by 35 U.S.C. 112, or 1.132 of this title or of any other (a)(1) Appellant(s) may once, within sixth paragraph, must be identified and evidence entered by the examiner and time limits for filing set forth in § 41.66, the structure, material, or acts described relied upon by appellant in the appeal, file a brief and serve the brief on all in the specification as corresponding to along with a statement setting forth other parties to the proceeding in each claimed function must be set forth where in the record that evidence was accordance with § 1.903 of this title. with reference to the specification by entered in the record by the examiner. (2) The brief must be signed by the page and line number, and to the Reference to unentered evidence is not appellant, or the appellant’s duly drawing, if any, by reference characters. permitted in the brief. See § 41.63 for authorized attorney or agent and must (vi) Issues to be reviewed on appeal. treatment of evidence submitted after be accompanied by the requisite fee set A concise statement of each issue appeal. This appendix may also include forth in § 41.20(b)(2). presented for review. No new ground of copies of the evidence relied upon by (b) An appellant’s appeal shall stand rejection can be proposed by a third the examiner in any ground of rejection dismissed upon failure of that appellant party requester appellant, unless such to be reviewed on appeal. to file an appellant’s brief, accompanied ground was withdrawn by the examiner (x) Related proceedings appendix. An by the requisite fee, within the time during the prosecution of the appendix containing copies of decisions allowed under § 41.66(a). rendered by a court or the Board in any (c)(1) The appellant’s brief shall proceeding, and the third party requester has not yet had an opportunity proceeding identified pursuant to contain the following items under paragraph (c)(1)(ii) of this section. appropriate headings and in the order to propose it as a third party requester proposed ground of rejection. (xi) Certificate of service. A indicated in paragraphs (c)(1)(i) through certification that a copy of the brief has (vii) Argument. The contentions of (c)(1)(xi) of this section. been served in its entirety on all other appellant with respect to each issue (i) Real party in interest. A statement parties to the reexamination proceeding. presented for review in paragraph identifying by name the real party in The names and addresses of the parties (c)(1)(vi) of this section, and the basis interest. served must be indicated. (ii) Related appeals and interferences. therefor, with citations of the statutes, (2) A brief shall not include any new A statement identifying by application, regulations, authorities, and parts of the or non-admitted amendment, or any patent, appeal or interference number record relied on. Any arguments or new or non-admitted affidavit or other all other prior and pending appeals, authorities not included in the brief evidence. See § 1.116 of this title for interferences or judicial proceedings permitted under this section or §§ 41.68 amendments, affidavits or other known to appellant, the appellant’s and 41.71 will be refused consideration evidence filed after final action but legal representative, or assignee which by the Board, unless good cause is before or on the same date of filing an may be related to, directly affect or be shown. Each issue must be treated appeal and § 41.63 for amendments, directly affected by or have a bearing on under a separate heading. If the affidavits or other evidence after the the Board’s decision in the pending appellant is the patent owner, for each date of filing the appeal. appeal. Copies of any decisions ground of rejection in the Right of (d) If a brief is filed which does not rendered by a court or the Board in any Appeal Notice which appellant contests comply with all the requirements of proceeding identified under this and which applies to two or more paragraph (a) and paragraph (c) of this paragraph must be included in an claims, the claims may be argued section, appellant will be notified of the appendix as required by paragraph separately or as a group. When multiple reasons for non-compliance and given a (c)(1)(xi) of this section. claims subject to the same ground of non-extendable time period within (iii) Status of claims. A statement of rejection are argued as a group by which to file an amended brief. If the status of all the claims in the appellant, the Board may select a single appellant does not file an amended brief proceeding (e.g., rejected, allowed or claim from the group of claims that are within the set time period, or files an confirmed, withdrawn, objected to, argued together to decide the appeal amended brief which does not overcome canceled). If the appellant is the owner, with respect to the group of claims as to all the reasons for non-compliance the appellant must also identify the the ground of rejection on the basis of stated in the notification, that rejected claims whose rejection is being the selected claim alone. appellant’s appeal will stand dismissed. appealed. If the appellant is a requester, Notwithstanding any other provision of the appellant must identify the claims this paragraph, the failure of appellant § 41.68 Respondent’s brief. that the examiner has made a to separately argue claims which (a)(1) Respondent(s) in an appeal may determination favorable to patentability, appellant has grouped together shall once, within the time limit for filing set which determination is being appealed. constitute a waiver of any argument that forth in § 41.66, file a respondent brief (iv) Status of amendments. A the Board must consider the and serve the brief on all parties in statement of the status of any patentability of any grouped claim accordance with § 1.903 of this title. amendment filed subsequent to the separately. Any claim argued separately (2) The brief must be signed by the close of prosecution. should be placed under a subheading party, or the party’s duly authorized (v) Summary of claimed subject identifying the claim by number. Claims attorney or agent, and must be matter. A concise explanation of the argued as a group should be placed accompanied by the requisite fee set subject matter defined in each of the under a subheading identifying the forth in § 41.20(b)(2). independent claims involved in the claims by number. A statement which (3) The respondent brief shall be appeal, which shall refer to the merely points out what a claim recites limited to issues raised in the appellant
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brief to which the respondent brief is a contention of the appellant is § 41.69 Examiner’s answer. directed. disputed, the errors in appellant’s (a) The primary examiner may, within (4) A requester’s respondent brief may argument must be specified, stating the such time as directed by the Director, not address any brief of any other basis therefor, with citations of the furnish a written answer to the owner’s requester. statutes, regulations, authorities, and and/or requester’s appellant brief or (b)(1) The respondent brief shall parts of the record relied on. Each issue respondent brief including, as may be contain the following items under must be treated under a separate necessary, such explanation of the appropriate headings and in the order heading. An argument may be made invention claimed and of the references here indicated, and may include an with each of the issues stated in the relied upon, the grounds of rejection, appendix containing only those portions counter statement of the issues, with and the reasons for patentability, of the record on which reliance has been each counter-stated issue being treated including grounds for not adopting any made. under a separate heading. proposed rejection. A copy of the (i) Real Party in Interest. A statement (viii) Evidence appendix. An answer shall be supplied to the owner identifying by name the real party in and all requesters. If the primary interest. appendix containing copies of any evidence submitted pursuant to examiner determines that the appeal (ii) Related Appeals and does not comply with the provisions of Interferences. A statement identifying §§ 1.130, 1.131, or 1.132 of this title or of any other evidence entered by the §§ 41.61, 41.66, 41.67 and 41.68 or does by application, patent, appeal or not relate to an appealable action, the interference number all other prior and examiner and relied upon by respondent in the appeal, along with a primary examiner shall make such pending appeals, interferences or determination of record. statement setting forth where in the judicial proceedings known to (b) An examiner’s answer may not record that evidence was entered in the respondent, the respondent’s legal include a new ground of rejection. representative, or assignee which may record by the examiner. Reference to (c) An examiner’s answer may not be related to, directly affect or be unentered evidence is not permitted in include a new determination not to directly affected by or have a bearing on the respondent’s brief. See § 41.63 for make a proposed rejection of a claim. the Board’s decision in the pending treatment of evidence submitted after (d) Any new ground of rejection, or appeal. Copies of any decisions appeal. any new determination not to make a rendered by a court or the Board in any (ix) Related proceedings appendix. proposed rejection, must be made in an proceeding identified under this An appendix containing copies of Office action reopening prosecution. paragraph must be included in an decisions rendered by a court or the § 41.71 Rebuttal brief. appendix as required by paragraph Board in any proceeding identified (b)(1)(ix) of this section. pursuant to paragraph (b)(1)(ii) of this (a) Within one month of the (iii) Status of claims. A statement section. examiner’s answer, any appellant may accepting or disputing appellant’s once file a rebuttal brief. statement of the status of claims. If (x) Certificate of service. A (b)(1) The rebuttal brief of the owner appellant’s statement of the status of certification that a copy of the may be directed to the examiner’s claims is disputed, the errors in respondent brief has been served in its answer and/or any respondent brief. appellant’s statement must be specified entirety on all other parties to the (2) The rebuttal brief of the owner with particularity. reexamination proceeding. The names shall not include any new or non- (iv) Status of amendments. A and addresses of the parties served must admitted amendment, or an affidavit or statement accepting or disputing be indicated. other evidence. See § 1.116 of this title appellant’s statement of the status of (2) A respondent brief shall not for amendments, affidavits or other amendments. If appellant’s statement of include any new or non-admitted evidence filed after final action but the status of amendments is disputed, amendment, or any new or non- before or on the same date of filing an the errors in appellant’s statement must admitted affidavit or other evidence. See appeal and § 41.63 for amendments, be specified with particularity. § 1.116 of this title for amendments, affidavits or other evidence filed after (v) Summary of claimed subject affidavits or other evidence filed after the date of filing the appeal. matter. A statement accepting or final action but before or on the same (c)(1) The rebuttal brief of any disputing appellant’s summary of the date of filing an appeal and § 41.63 for requester may be directed to the subject matter defined in each of the amendments, affidavits or other examiner’s answer and/or the independent claims involved in the evidence filed after the date of filing the respondent brief of the owner. appeal. If appellant’s summary of the appeal. (2) The rebuttal brief of a requester subject matter is disputed, the errors in may not be directed to the respondent appellant’s summary must be specified. (c) If a respondent brief is filed which brief of any other requester. (vi) Issues to be reviewed on appeal. does not comply with all the (3) No new ground of rejection can be A statement accepting or disputing requirements of paragraph (a) and proposed by a requester. appellant’s statement of the issues paragraph (b) of this section, respondent (4) The rebuttal brief of a requester presented for review. If appellant’s will be notified of the reasons for non- shall not include any new or non- statement of the issues presented for compliance and given a non-extendable admitted affidavit or other evidence. See review is disputed, the errors in time period within which to file an § 1.116(d) of this title for affidavits or appellant’s statement must be specified. amended brief. If respondent does not other evidence filed after final action A counter statement of the issues for file an amended respondent brief within but before or on the same date of filing review may be made. No new ground of the set time period, or files an amended an appeal and § 41.63(c) for affidavits or rejection can be proposed by a requester respondent brief which does not other evidence filed after the date of respondent. overcome all the reasons for non- filing the appeal. (vii) Argument. A statement accepting compliance stated in the notification, (d) The rebuttal brief must include a or disputing the contentions of the respondent brief and any amended certification that a copy of the rebuttal appellant with each of the issues respondent brief by that respondent will brief has been served in its entirety on presented by the appellant for review. If not be considered. all other parties to the proceeding. The
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names and addresses of the parties in the notice, and oral argument will be claim, it may include in its opinion a served must be indicated. limited to thirty minutes for each statement to that effect with its reasons (e) If a rebuttal brief is timely filed appellant or respondent who has for so holding, which statement shall under paragraph (a) of this section but requested an oral hearing, and twenty constitute a new ground of rejection of does not comply with all the minutes for the primary examiner the claim. Any decision which includes requirements of paragraphs (a) through unless otherwise ordered. No appellant a new ground of rejection pursuant to (d) of this section, appellant will be or respondent will be permitted to this paragraph shall not be considered notified of the reasons for non- participate in an oral hearing unless he final for judicial review. When the compliance and provided with a non- or she has requested an oral hearing and Board makes a new ground of rejection, extendable period of one month within submitted the fee set forth in the owner, within one month from the which to file an amended rebuttal brief. § 41.20(b)(3). date of the decision, must exercise one If the appellant does not file an (e)(1) At the oral hearing, each of the following two options with amended rebuttal brief during the one- appellant and respondent may only rely respect to the new ground of rejection month period, or files an amended on evidence that has been previously to avoid termination of the appeal rebuttal brief which does not overcome entered and considered by the primary proceeding as to the rejected claim: all the reasons for non-compliance examiner and present argument that has (1) Reopen prosecution. The owner stated in the notification, that been relied upon in the briefs except as may file a response requesting appellant’s rebuttal brief and any permitted by paragraph (e)(2) of this reopening of prosecution before the amended rebuttal brief by that appellant section. The primary examiner may only examiner. Such a response must be will not be considered. rely on argument and evidence relied either an amendment of the claims so upon in an answer except as permitted § 41.73 Oral hearing. rejected or new evidence relating to the by paragraph (e)(2) of this section. The (a) An oral hearing should be claims so rejected, or both. Board will determine the order of the (2) Request rehearing. The owner may requested only in those circumstances arguments presented at the oral hearing. in which an appellant or a respondent request that the proceeding be reheard (2) Upon a showing of good cause, under § 41.79 by the Board upon the considers such a hearing necessary or appellant, respondent and/or the desirable for a proper presentation of same record. The request for rehearing primary examiner may rely on a new must address any new ground of the appeal. An appeal decided on the argument based upon a recent relevant briefs without an oral hearing will rejection and state with particularity the decision of either the Board or a Federal points believed to have been receive the same consideration by the Court. Board as an appeal decided after an oral misapprehended or overlooked in (f) Notwithstanding the submission of entering the new ground of rejection hearing. a request for oral hearing complying (b) If an appellant or a respondent and also state all other grounds upon with this rule, if the Board decides that which rehearing is sought. desires an oral hearing, he or she must a hearing is not necessary, the Board (c) Where the owner has filed a file, as a separate paper captioned will so notify the owner and all response requesting reopening of ‘‘REQUEST FOR ORAL HEARING,’’ a requesters. written request for such hearing prosecution under paragraph (b)(1) of accompanied by the fee set forth in § 41.77 Decisions and other actions by the this section, any requester, within one § 41.20(b)(3) within two months after Board. month of the date of service of the the date of the examiner’s answer. The (a) The Board of Patent Appeals and owner’s response, may once file time for requesting an oral hearing may Interferences, in its decision, may affirm comments on the response. Such not be extended. The request must or reverse each decision of the examiner written comments must be limited to include a certification that a copy of the on all issues raised on each appealed the issues raised by the Board’s opinion request has been served in its entirety claim, or remand the reexamination reflecting its decision and the owner’s on all other parties to the proceeding. proceeding to the examiner for further response. Any requester that had not The names and addresses of the parties consideration. The reversal of the previously filed an appeal or cross served must be indicated. examiner’s determination not to make a appeal and is seeking under this (c) If no request and fee for oral rejection proposed by the third party subsection to file comments or a reply hearing have been timely filed by requester constitutes a decision adverse to the comments is subject to the appeal appellant or respondent as required by to the patentability of the claims which and brief fees under § 41.20(b)(1) and paragraph (b) of this section, the appeal are subject to that proposed rejection (2), respectively, which must will be assigned for consideration and which will be set forth in the decision accompany the comments or reply. decision on the briefs without an oral of the Board of Patent Appeals and (d) Following any response by the hearing. Interferences as a new ground of owner under paragraph (b)(1) of this (d) If appellant or respondent has rejection under paragraph (b) of this section and any written comments from complied with all the requirements of section. The affirmance of the rejection a requester under paragraph (c) of this paragraph (b) of this section, a hearing of a claim on any of the grounds section, the proceeding will be date will be set, and notice given to the specified constitutes a general remanded to the examiner. The owner and all requesters. If an oral affirmance of the decision of the statement of the Board shall be binding hearing is held, an oral argument may examiner on that claim, except as to any upon the examiner unless an be presented by, or on behalf of, the ground specifically reversed. amendment or new evidence not primary examiner if considered (b) Should the Board reverse the previously of record is made which, in desirable by either the primary examiner’s determination not to make a the opinion of the examiner, overcomes examiner or the Board. The notice shall rejection proposed by a requester, the the new ground of rejection stated in the set a non-extendable period within Board shall set forth in the opinion in decision. The examiner will consider which all requests for oral hearing shall support of its decision a new ground of any owner response under paragraph be submitted by any other party to the rejection; or should the Board have (b)(1) of this section and any written appeal desiring to participate in the oral knowledge of any grounds not raised in comments by a requester under hearing. A hearing will be held as stated the appeal for rejecting any pending paragraph (c) of this section and issue
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a determination that the rejection is (2) Upon a showing of good cause, Involved means the Board has maintained or has been overcome. appellant and/or respondent may declared the patent application, patent, (e) Within one month of the present a new argument based upon a or claim so described to be a subject of examiner’s determination pursuant to recent relevant decision of either the the contested case. paragraph (d) of this section, the owner Board or a Federal Court. § 41.101 Notice of proceeding. or any requester may once submit (3) New arguments responding to a comments in response to the examiner’s new ground of rejection made pursuant (a) Notice of a contested case will be determination. Within one month of the to § 41.77(b) are permitted. sent to every party to the proceeding. date of service of comments in response (c) Within one month of the date of The entry of the notice initiates the to the examiner’s determination, the service of any request for rehearing proceeding. owner and any requesters may file a under paragraph (a) of this section, or (b) When the Board is unable to reply to the comments. No requester any further request for rehearing under provide actual notice of a contested case reply may address the comments of any paragraph (d) of this section, the owner on a party through the correspondence other requester reply. Any requester that and all requesters may once file address of record for the party, the had not previously filed an appeal or comments in opposition to the request Board may authorize other modes of cross appeal and is seeking under this for rehearing or the further request for notice, including: subsection to file comments or a reply rehearing. The comments in opposition (1) Sending notice to another address to the comments is subject to the appeal must be limited to the issues raised in associated with the party, or (2) Publishing the notice in the and brief fees under § 41.20(b)(1) and the request for rehearing or the further Official Gazette of the United States (2), respectively, which must request for rehearing. Patent and Trademark Office. accompany the comments or reply. (d) If a party to an appeal files a (f) After submission of any comments request for rehearing under paragraph § 41.102 Completion of examination. and any reply pursuant to paragraph (e) (a) of this section, or a further request Before a contested case is initiated, of this section, or after time has expired, for rehearing under this section, the except as the Board may otherwise the proceeding will be returned to the Board shall render a decision on the authorize, for each involved application Board which shall reconsider the matter request for rehearing. The decision on and patent: and issue a new decision. The new the request for rehearing is deemed to (a) Examination or reexamination decision is deemed to incorporate the incorporate the earlier opinion must be completed, and earlier decision, except for those reflecting its decision for appeal, except (b) There must be at least one claim portions specifically withdrawn. for those portions specifically that: (g) The time period set forth in withdrawn on rehearing and is final for (1) Is patentable but for a judgment in paragraph (b) of this section is subject the purpose of judicial review, except the contested case, and to the extension of time provisions of when noted otherwise in the decision (2) Would be involved in the § 1.956 of this title when the owner is on rehearing. If the Board opinion contested case. responding under paragraph (b)(1) of reflecting its decision on rehearing § 41.103 Jurisdiction over involved files. this section. The time period set forth in becomes, in effect, a new decision, and paragraph (b) of this section may not be the Board so indicates, then any party The Board acquires jurisdiction over extended when the owner is responding to the appeal may, within one month of any involved file when the Board under paragraph (b)(2) of this section. the new decision, file a further request initiates a contested case. Other The time periods set forth in paragraphs for rehearing of the new decision under proceedings for the involved file within (c) and (e) of this section may not be this subsection. Such further request for the Office are suspended except as the extended. rehearing must comply with paragraph Board may order. (b) of this section. § 41.104 Conduct of contested case. § 41.79 Rehearing. (e) The times for requesting rehearing (a) Parties to the appeal may file a under paragraph (a) of this section, for (a) The Board may determine a proper request for rehearing of the decision requesting further rehearing under course of conduct in a proceeding for within one month of the date of: paragraph (c) of this section, and for any situation not specifically covered by this part and may enter non-final orders (1) The original decision of the Board submitting comments under paragraph to administer the proceeding. under § 41.77(a), (b) of this section may not be extended. (b) An administrative patent judge (2) The original § 41.77(b) decision § 41.81 Action following decision. may waive or suspend in a proceeding under the provisions of § 41.77(b)(2), The parties to an appeal to the Board the application of any rule in this (3) The expiration of the time for the may not appeal to the U.S. Court of subpart, subject to such conditions as owner to take action under § 41.77(b)(2), Appeals for the Federal Circuit under the administrative patent judge may or § 1.983 of this title until all parties’ impose. (4) The new decision of the Board rights to request rehearing have been (c) Times set in this subpart are under § 41.77(f). exhausted, at which time the decision of defaults. In the event of a conflict (b)(1) The request for rehearing must the Board is final and appealable by any between a time set by rule and a time state with particularity the points party to the appeal to the Board. set by order, the time set by order is believed to have been misapprehended controlling. Action due on a day other or overlooked in rendering the Board’s Subpart D—Contested Cases than a business day may be completed opinion reflecting its decision. on the next business day unless the Arguments not raised in the briefs § 41.100 Definitions. Board expressly states otherwise. before the Board and evidence not In addition to the definitions in previously relied upon in the briefs are § 41.2, the following definitions apply to § 41.106 Filing and service. not permitted in the request for proceedings under this subpart: (a) General format requirements. (1) rehearing except as permitted by Business day means a day other than The paper used for filings must be paragraphs (b)(2) and (b)(3) of this a Saturday, Sunday, or Federal holiday durable and white. A party must choose section. within the District of Columbia. to file on either A4-sized paper or 81⁄2
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inch × 11 inch paper except in the case (e) Service. (1) Papers filed with the § 41.109 Access to and copies of Office of exhibits that require a larger size in Board, if not previously served, must be records. order to preserve details of the original. served simultaneously on every (a) Request for access or copies. Any A party may not switch between paper opposing party except as the Board request from a party for access to or sizes in a single proceeding. Only one expressly directs. copies of Office records directly related side of the paper may be used. (2) If a party is represented by to a contested case must be filed with (2) In papers, including affidavits, counsel, service must be on counsel. the Board. The request must precisely created for the proceeding: (3) Service must be by EXPRESS identify the records and in the case of (i) Markings must be in black ink or MAIL or by means at least as fast and copies include the appropriate fee set must otherwise provide an equivalently reliable as EXPRESS MAIL . Electronic under § 1.19(b) of this title. permanent, dark, high-contrast image on service is not permitted without Board (b) Authorization of access and the paper. The quality of printing must authorization. copies. Access and copies will be equivalent to the quality produced by ordinarily only be authorized for the (4) The date of service does not count a laser printer. Either a proportional or following records: in computing the time for responding. monospaced font may be used, but the (1) The application file for an proportional font must be 12-point or (f) Certificate of service. (1) Papers involved patent; larger and a monospaced font must not other than exhibits must include a (2) An involved application; and contain more than 4 characters per certificate of service as a separate page (3) An application for which a party centimeter (10 characters per inch). Case at the end of each paper that must be has been accorded benefit under subpart names must be underlined or italicized. served on an opposing party. E of this part. (ii) Double spacing must be used (2) Exhibits must be accompanied by (c) Missing or incomplete copies. If a except in headings, tables of contents, a certificate of service, but a single party does not receive a complete copy tables of authorities, indices, signature certificate may accompany any group of of a record within 21 days of the blocks, and certificates of service. Block exhibits submitted together. authorization, the party must promptly quotations may be single-spaced and (3) A certificate of service must state: notify the Board. must be indented. Margins must be at (i) The date and manner of service, § 41.110 Filing claim information. least 2.5 centimeters (1 inch) on all (ii) The name and address of every (a) Clean copy of claims. Within 14 sides. person served, and (b) Papers other than exhibits—(1) days of the initiation of the proceeding, (iii) For exhibits filed as a group, the Cover sheet. (i) The cover sheet must each party must file a clean copy of its name and number of each exhibit include the caption the Board specifies involved claims and, if a biotechnology served. for the proceeding, a header indicating material sequence is a limitation, a the party and contact information for (4) A certificate made by a person clean copy of the sequence. the party, and a title indicating the other than a registered patent (b) Annotated copy of claims. Within sequence and subject of the paper. For practitioner must be in the form of an 28 days of the initiation of the example, ‘‘JONES MOTION 2, For affidavit. proceeding, each party must: benefit of an earlier application’’. § 41.108 Lead counsel. (1) For each involved claim having a (ii) If the Board specifies a color other limitation that is illustrated in a than white for the cover sheet, the cover (a) A party may be represented by drawing or biotechnology material sheet must be that color. counsel. The Board may require a party sequence, file an annotated copy of the (2) Papers must have two 0.5 cm (1⁄4 to appoint a lead counsel. If counsel is claim indicating in bold face between inch) holes with centers 1 cm (1⁄2inch) not of record in a party’s involved braces ({}) where each limitation is from the top of the page and 7 cm (2 3⁄4 application or patent, then a power of shown in the drawing or sequence. inch) apart, centered horizontally on the attorney for that counsel for the party’s (2) For each involved claim that page. involved application or patent must be contains a means-plus-function or step- (3) Incorporation by reference; filed with the notice required in plus-function limitation in the form combined papers. Arguments must not paragraph (b) of this section. permitted under 35 U.S.C. 112(6), file an be incorporated by reference from one (b) Within 14 days of the initiation of annotated copy of the claim indicating paper into another paper. Combined each contested case, each party must file in bold face between braces ({}) the motions, oppositions, replies, or other a separate notice identifying its counsel, specific portions of the specification combined papers are not permitted. if any, and providing contact that describe the structure, material, or (4) Exhibits. Additional requirements information for each counsel identified acts corresponding to each claimed for exhibits appear in § 41.154(c). or, if the party has no counsel, then for function. (c) Working copy. Every paper filed the party. Contact information must, at (c) Any motion to add or amend a must be accompanied by a working a minimum, include: claim must include: copy marked ‘‘APJ Copy’’. (1) A mailing address; (1) A clean copy of the claim, (d) Specific filing forms. (1) Filing by (2) An address for courier delivery (2) A claim chart showing where the mail. A paper filed using the EXPRESS disclosure of the patent or application when the mailing address is not MAIL service of the United States available for such delivery (for example, provides written description of the Postal Service will be deemed to be filed subject matter of the claim, and when the mailing address is a Post as of ‘‘date-in’’ on the EXPRESS MAIL Office box); (3) Where applicable, a copy of the mailing label; otherwise, mail will be (3) A telephone number; claims annotated according to paragraph deemed to be filed as of the stamped (b) of this section. date of receipt at the Board. (4) A facsimile number; and (2) Other modes of filing. The Board (5) An electronic mail address. § 41.120 Notice of basis for relief. may authorize other modes of filing, (c) A party must promptly notify the (a) The Board may require a party to including electronic filing and hand Board of any change in the contact provide a notice stating the relief it filing, and may set conditions for the information required in paragraph (b) of requests and the basis for its entitlement use of such other modes. this section. to relief. The Board may provide for the
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notice to be maintained in confidence a separate numbered sentence with (c) Exhibits. Each exhibit must be for a limited time. specific citations to the portions of the filed and served with the first paper in (b) Effect. If a notice under paragraph record that support the fact. which it is cited except as the Board (a) of this section is required, a party (2) The Board may require that the may otherwise order. will be limited to filing substantive statement of material facts be submitted motions consistent with the notice. as a separate paper. § 41.124 Oral argument. Ambiguities in the notice will be (e) Claim charts. Claim charts must be (a) Request for oral argument. A party construed against the party. A notice is used in support of any paper requiring may request an oral argument on an not evidence except as an admission by the comparison of a claim to something issue raised in a paper within five a party-opponent. else, such as another claim, prior art, or business days of the filing of the paper. (c) Correction. A party may move to a specification. Claim charts must The request must be filed as a separate correct its notice. The motion should be accompany the paper as an appendix. paper and must specify the issues to be filed promptly after the party becomes Claim charts are not a substitute for considered. aware of the basis for the correction. A appropriate argument and explanation (b) Copies for panel. If an oral correction filed after the time set for in the paper. argument is set for a panel, the movant filing notices will only be entered if (f) The Board may order briefing on on any issue to be argued must provide entry would serve the interests of any issue that could be raised by three working copies of the motion, the justice. motion. opposition, and the reply. Each party is responsible for providing three working § 41.121 Motions. § 41.122 Oppositions and replies. copies of its exhibits relating to the (a) Types of motions—(1) Substantive (a) Oppositions and replies must motion. motions. Consistent with the notice of comply with the content requirements (c) Length of argument. If a request for requested relief, if any, and to the extent for motions and must include a oral argument is granted, each party will the Board authorizes, a party may file a statement identifying material facts in have a total of 20 minutes to present its motion: dispute. Any material fact not arguments, including any time for (i) To redefine the scope of the specifically denied shall be considered rebuttal. contested case, admitted. (d) Demonstrative exhibits must be (ii) To change benefit accorded for the (b) All arguments for the relief served at least five business days before contested subject matter, or requested in a motion must be made in the oral argument and filed no later than (iii) For judgment in the contested the motion. A reply may only respond the time of the oral argument. case. to arguments raised in the (e) Transcription. The Board (2) Responsive motions. The Board corresponding opposition. may authorize a party to file a motion encourages the use of a transcription to amend or add a claim, to change § 41.123 Default filing times. service at oral arguments but, if such a inventorship, or otherwise to cure a (a) A motion, other than a service is to be used, the Board must be defect raised in a notice of requested miscellaneous motion, may only be filed notified in advance to ensure adequate relief or in a substantive motion. according to a schedule the Board sets. facilities are available and a transcript (3) Miscellaneous motions. Any The default times for acting are: must be filed with the Board promptly request for relief other than a (1) An opposition is due 30 days after after the oral argument. substantive or responsive motion must service of the motion. § 41.125 Decision on motions. be filed as a miscellaneous motion. (2) A reply is due 30 days after service (a) Order of consideration. The Board (b) Burden of proof. The party filing of the opposition. may take up motions for decisions in the motion has the burden of proof to (3) A responsive motion is due 30 any order, may grant, deny, or dismiss establish that it is entitled to the days after the service of the motion. any motion, and may take such other requested relief. (b) Miscellaneous motions. (1) If no (c) Content of motions; oppositions time for filing a specific miscellaneous action appropriate to secure the just, and replies. (1) Each motion must be motion is provided in this part or in a speedy, and inexpensive determination filed as a separate paper and must Board order: of the proceeding. A decision on a include: (i) The opposing party must be motion may include deferral of action (i) A statement of the precise relief consulted prior to filing the on an issue until a later point in the requested, miscellaneous motion, and proceeding. (ii) A statement of material facts (see (ii) If an opposing party plans to (b) Interlocutory decisions. A decision paragraph (d) of this section), and oppose the miscellaneous motion, the on motions without a judgment is not (iii) A full statement of the reasons for movant may not file the motion without final for the purposes of judicial review. the relief requested, including a detailed Board authorization. Such authorization A panel decision on an issue will explanation of the significance of the should ordinarily be obtained through a govern further proceedings in the evidence and the governing law, rules, telephone conference including the contested case. and precedent. Board and every other party to the (c) Rehearing—(1) Time for request. A (2) Compliance with rules. Where a proceeding. Delay in seeking relief may request for rehearing of a decision on a rule in part 1 of this title ordinarily justify a denial of the motion. motion must be filed within fourteen governs the relief sought, the motion (2) An opposition may not be filed days of the decision. must make any showings required without authorization. The default times (2) No tolling. The filing of a request under that rule in addition to any for acting are: for rehearing does not toll times for showings required in this part. (i) An opposition to a miscellaneous taking action. (3) The Board may order additional motion is due five business days after (3) Burden on rehearing. The burden showings or explanations as a condition service of the motion. of showing a decision should be for filing a motion. (ii) A reply to a miscellaneous motion modified lies with the party attacking (d) Statement of material facts. (1) opposition is due three business days the decision. The request must Each material fact shall be set forth as after service of the opposition. specifically identify:
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(i) All matters the party believes to award is dispositive of the contested (2) Advancing a misleading or have been misapprehended or subject matter for a party, the Board may frivolous request for relief or argument; overlooked, and enter judgment as to that party. or (ii) The place where the matter was (3) Engaging in dilatory tactics. § 41.127 Judgment. previously addressed in a motion, (b) Sanctions include entry of: opposition, or reply. (a) Effect within Office—(1) Estoppel. (1) An order holding certain facts to (4) Opposition; reply. Neither an A judgment disposes of all issues that have been established in the proceeding; were, or by motion could have properly opposition nor a reply to a request for (2) An order expunging, or precluding been, raised and decided. A losing party rehearing may be filed without Board a party from filing, a paper; authorization. who could have properly moved for (3) An order precluding a party from (5) Panel rehearing. If a decision is relief on an issue, but did not so move, presenting or contesting a particular not a panel decision, the party may not take action in the Office after issue; requesting rehearing may request that a the judgment that is inconsistent with panel rehear the decision. A panel that party’s failure to move, except that (4) An order precluding a party from rehearing a procedural decision will a losing party shall not be estopped with requesting, obtaining, or opposing review the decision for an abuse of respect to any contested subject matter discovery; discretion. for which that party was awarded a (5) An order excluding evidence; favorable judgment. (6) An order awarding compensatory § 41.126 Arbitration. (2) Final disposal of claim. Adverse expenses, including attorney fees; (a) Parties to a contested case may judgment against a claim is a final (7) An order requiring terminal resort to binding arbitration to action of the Office requiring no further disclaimer of patent term; or determine any issue in a contested case. action by the Office to dispose of the (8) Judgment in the contested case. The Office is not a party to the claim permanently. § 41.150 Discovery. arbitration. The Board is not bound and (b) Request for adverse judgment. A may independently determine questions party may at any time in the proceeding (a) Limited discovery. A party is not of patentability, jurisdiction, and Office request judgment against itself. Actions entitled to discovery except as practice. construed to be a request for adverse authorized in this subpart. The parties (b) The Board will not authorize judgment include: may agree to discovery among arbitration unless: (1) Abandonment of an involved themselves at any time. (1) It is to be conducted according to application such that the party no (b) Automatic discovery. (1) Within 21 Title 9 of the United States Code. longer has an application or patent days of a request by an opposing party, (2) The parties notify the Board in involved in the proceeding, a party must: writing of their intention to arbitrate. (2) Cancellation or disclaiming of a (i) Serve a legible copy of every (3) The agreement to arbitrate: claim such that the party no longer has requested patent, patent application, (i) Is in writing, literature reference, and test standard (ii) Specifies the issues to be a claim involved in the proceeding, mentioned in the specification of the arbitrated, (3) Concession of priority or party’s involved patent or application, (iii) Names the arbitrator, or provides unpatentability of the contested subject or application upon which the party a date not more than 30 days after the matter, and will rely for benefit, and, if the execution of the agreement for the (4) Abandonment of the contest. requested material is in a language other selection of the arbitrator, and (c) Recommendation. The judgment than English, a translation, if available, (iv) Provides that the arbitrator’s may include a recommendation for and award shall be binding on the parties further action by the examiner or by the and that judgment thereon can be Director. If the Board recommends (ii) File with the Board a notice entered by the Board. rejection of a claim of an involved (without copies of the requested (4) A copy of the agreement is filed application, the examiner must enter materials) of service of the requested within 20 days after its execution. and maintain the recommended materials. (5) The arbitration is completed rejection unless an amendment or (2) Unless previously served, or the within the time the Board sets. showing of facts not previously of Board orders otherwise, any exhibit (c) The parties are solely responsible record is filed which, in the opinion of cited in a motion or in testimony must for the selection of the arbitrator and the the examiner, overcomes the be served with the citing motion or conduct of proceedings before the recommended rejection. testimony. arbitrator. (d) Rehearing. A party dissatisfied (c) Additional discovery. (1) A party (d) Issues not disposed of by the with the judgment may file a request for may request additional discovery. The arbitration will be resolved in rehearing within 30 calendar days of the requesting party must show that such accordance with the procedures entry of the judgment. The request must additional discovery is in the interests established in this subpart. specifically identify all matters the party of justice. The Board may specify (e) The Board will not consider the believes to have been misapprehended conditions for such additional arbitration award unless it: or overlooked, and the place where the discovery. (1) Is binding on the parties, matter was previously addressed in a (2) When appropriate, a party may (2) Is in writing, motion, opposition, or reply. obtain production of documents and (3) States in a clear and definite things during cross examination of an manner each issue arbitrated and the § 41.128 Sanctions. opponent’s witness or during testimony disposition of each issue, and (a) The Board may impose a sanction authorized under § 41.156. (4) Is filed within 20 days of the date against a party for misconduct, of the award. including: § 41.151 Admissibility. (f) Once the award is filed, the parties (1) Failure to comply with an Evidence that is not taken, sought, or to the award may not take actions applicable rule or order in the filed in accordance with this subpart inconsistent with the award. If the proceeding; shall not be admissible.
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§ 41.152 Applicability of the Federal Rules parties, and the proceeding number in (1) In the case of testimony, identify of Evidence. the following format: the witness by name or title, and (a) Generally. Except as otherwise JONES EXHIBIT 2001 (2) In the case of a document or thing, provided in this subpart, the Federal Jones v. Smith the general nature of the document or Rules of Evidence shall apply to Interference 104,999 thing. contested cases. (2) When the exhibit is a paper: (b) Outside the United States. For (b) Exclusions. Those portions of the (i) Each page must be uniquely testimony or production sought outside Federal Rules of Evidence relating to numbered in sequence, and the United States, the motion must also: criminal proceedings, juries, and other (ii) The exhibit label must be affixed (1) In the case of testimony. (i) matters not relevant to proceedings to the lower right corner of the first page Identify the foreign country and explain under this subpart shall not apply. of the exhibit without obscuring why the party believes the witness can (c) Modifications in terminology. information on the first page or, if be compelled to testify in the foreign Unless otherwise clear from context, the obscuring is unavoidable, affixed to a country, including a description of the following terms of the Federal Rules of duplicate first page. procedures that will be used to compel Evidence shall be construed as (d) Exhibit list. Each party must the testimony in the foreign country and indicated: maintain an exhibit list with the exhibit an estimate of the time it is expected to Appellate court means United States number and a brief description of each take to obtain the testimony; and Court of Appeals for the Federal Circuit exhibit. If the exhibit is not filed, the (ii) Demonstrate that the party has or a United States district court when exhibit list should note that fact. The made reasonable efforts to secure the judicial review is under 35 U.S.C. 146. Board may require the filing of a current agreement of the witness to testify in the Civil action, civil proceeding, action, exhibit list prior to acting on a motion. United States but has been unsuccessful and trial mean contested case. in obtaining the agreement, even though Courts of the United States, U.S. § 41.155 Objection; motion to exclude; motion in limine. the party has offered to pay the Magistrate, court, trial court, and trier of expenses of the witness to travel to and (a) Deposition. Objections to fact mean Board. testify in the United States. deposition evidence must be made Hearing means: (2) In the case of production of a during the deposition. Evidence to cure (i) In Federal Rule of Evidence 703, document or thing. (i) Identify the the objection must be provided during the time when the expert testifies. foreign country and explain why the (ii) In Federal Rule of Evidence the deposition unless the parties to the party believes production of the 804(a)(5), the time for taking testimony. deposition stipulate otherwise on the document or thing can be compelled in Judge means the Board. deposition record. the foreign country, including a Judicial notice means official notice. (b) Other than deposition. For description of the procedures that will Trial or hearing means, in Federal evidence other than deposition be used to compel production of the Rule of Evidence 807, the time for evidence: document or thing in the foreign taking testimony. (1) Objection. Any objection must be country and an estimate of the time it (d) The Board, in determining foreign filed within five business days of is expected to take to obtain production law, may consider any relevant material service of evidence, other than of the document or thing; and or source, including testimony, whether deposition evidence, to which the or not submitted by a party or objection is directed. The objection (ii) Demonstrate that the party has admissible under the Federal Rules of must identify the grounds for the made reasonable efforts to obtain the Evidence. objection with sufficient particularity to agreement of the individual or entity allow correction in the form of having possession, custody, or control § 41.153 Records of the Office. supplemental evidence. of the document to produce the Certification is not necessary as a (2) Supplemental evidence. The party document or thing in the United States condition to admissibility when the relying on evidence to which an but has been unsuccessful in obtaining evidence to be submitted is a record of objection is timely filed may respond to that agreement, even though the party the Office to which all parties have the objection by filing supplemental has offered to pay the expenses of access. evidence within ten business days of producing the document or thing in the United States. § 41.154 Form of evidence. service of the objection. (c) Motion to exclude. A § 41.157 Taking testimony. (a) Evidence consists of affidavits, miscellaneous motion to exclude (a) Form. Direct testimony must be transcripts of depositions, documents, evidence must be filed to preserve any submitted in the form of an affidavit and things. All evidence must be objection. The motion must identify the except when the testimony is compelled submitted in the form of an exhibit. objections in the record in order and under 35 U.S.C. 24, in which case it (b) Translation required. When a must explain the objections. party relies on a document or is (d) Motion in limine. A party may file may be in the form of a deposition required to produce a document in a a miscellaneous motion in limine for a transcript. language other than English, a ruling on the admissibility of evidence. (b) Time and location. (1) translation of the document into English Uncompelled direct testimony may be and an affidavit attesting to the accuracy § 41.156 Compelling testimony and taken at any time; otherwise, testimony of the translation must be filed with the production. may only be taken during such time document. (a) Authorization required. A party period as the Board may authorize. (c) An exhibit must conform with the seeking to compel testimony or (2) Other testimony. (i) Except as the requirements for papers in § 41.106 of production of documents or things must Board otherwise orders, authorized this subpart and the requirements of this file a miscellaneous motion for testimony may be taken at any paragraph. authorization. The miscellaneous reasonable time and location within the (1) Each exhibit must have an exhibit motion must describe the general United States before any disinterested label with a unique number in a range relevance of the testimony, document, official authorized to administer oaths at assigned by the Board, the names of the or thing and must: that location.
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(ii) Testimony outside the United presence of the officer is waived on the writing, the proponent of the testimony States may only be taken as the Board record by agreement of all parties. shall bear all costs associated with the specifically directs. (3) Any exhibits relied upon must be testimony, including the reasonable (c) Notice of deposition. (1) Prior to numbered according to the numbering costs associated with making the the taking of testimony, all parties to the scheme assigned for the contested case witness available for the cross- proceeding must agree on the time and and must, if not previously served, be examination. place for taking testimony. If the parties served at the deposition. cannot agree, the party seeking the (4) All objections made at the time of § 41.158 Expert testimony; tests and data. testimony must initiate a conference the deposition to the qualifications of (a) Expert testimony that does not with the Board to set a time and place. the officer taking the deposition, the disclose the underlying facts or data on (2) Cross-examination should manner of taking it, the evidence which the opinion is based is entitled to ordinarily take place after any presented, the conduct of any party, and little or no weight. Testimony on United supplemental evidence relating to the any other objection to the proceeding States patent law will not be admitted. direct testimony has been filed and shall be noted on the record by the (b) If a party relies on a technical test more than a week before the filing date officer. Evidence objected to shall be or data from such a test, the party must for any paper in which the cross- taken subject to a ruling on the provide an affidavit explaining: examination testimony is expected to be objection. (1) Why the test or data is being used, used. A party requesting cross- (5) When the testimony has been (2) How the test was performed and examination testimony of more than one transcribed, the witness shall read and the data was generated, witness may choose the order in which sign (in the form of an affidavit) a (3) How the data is used to determine the witnesses are to be cross-examined. transcript of the deposition unless: a value, (3) In the case of direct testimony, at (i) The parties otherwise agree in (4) How the test is regarded in the least three business days prior to the writing, (ii) The parties waive reading relevant art, and conference in paragraph (c)(1) of this and signature by the witness on the (5) Any other information necessary section, the party seeking the direct record at the deposition, or for the Board to evaluate the test and testimony must serve: (iii) The witness refuses to read or data. (i) A list and copy of each document sign the transcript of the deposition. under the party’s control and on which (6) The officer shall prepare a certified Subpart E—Patent Interferences transcript by attaching to the transcript the party intends to rely, and § 41.200 Procedure; pendency. (ii) A list of, and proffer of reasonable of the deposition a certificate in the access to, any thing other than a form of an affidavit signed and sealed by (a) A patent interference is a contested document under the party’s control and the officer. Unless the parties waive any case subject to the procedures set forth on which the party intends to rely. of the following requirements, in which in subpart D of this part. (4) Notice of the deposition must be case the certificate shall so state, the (b) A claim shall be given its broadest filed at least two business days before a certificate must state: reasonable construction in light of the deposition. The notice limits the scope (i) The witness was duly sworn by the specification of the application or patent of the testimony and must list: officer before commencement of in which it appears. (i) The time and place of the testimony by the witness; (c) Patent interferences shall be deposition, (ii) The transcript is a true record of administered such that pendency before (ii) The name and address of the the testimony given by the witness; the Board is normally no more than two witness, (iii) The name of the person who years. (iii) A list of the exhibits to be relied recorded the testimony and, if the § 41.201 Definitions. upon during the deposition, and officer did not record it, whether the (iv) A general description of the scope testimony was recorded in the presence In addition to the definitions in and nature of the testimony to be of the officer; §§ 41.2 and 41.100, the following elicited. (iv) The presence or absence of any definitions apply to proceedings under (5) Motion to quash. Objection to a opponent; this subpart: defect in the notice is waived unless a (v) The place where the deposition Accord benefit means Board miscellaneous motion to quash is was taken and the day and hour when recognition that a patent application promptly filed. the deposition began and ended; provides a proper constructive (d) Deposition in a foreign language. (vi) The officer has no disqualifying reduction to practice under 35 U.S.C. If an interpreter will be used during the interest, personal or financial, in a 102(g)(1). deposition, the party calling the witness party; and Constructive reduction to practice must initiate a conference with the (vii) If a witness refuses to read or means a described and enabled Board at least five business days before sign the transcript, the circumstances anticipation under 35 U.S.C. 102(g)(1) in the deposition. under which the witness refused. a patent application of the subject (e) Manner of taking testimony. (1) (7) The officer must promptly provide matter of a count. Earliest constructive Each witness before giving a deposition a copy of the transcript to all parties. reduction to practice means the first shall be duly sworn according to law by The proponent of the testimony must constructive reduction to practice that the officer before whom the deposition file the original as an exhibit. has been continuously disclosed is to be taken. The officer must be (8) Any objection to the content, form, through a chain of patent applications authorized to take testimony under 35 or manner of taking the deposition, including in the involved application or U.S.C. 23. including the qualifications of the patent. For the chain to be continuous, (2) The testimony shall be taken in officer, is waived unless made on the each subsequent application must have answer to interrogatories with any record during the deposition and been co-pending under 35 U.S.C. 120 or questions and answers recorded in their preserved in a timely filed 121 or timely filed under 35 U.S.C. 119 regular order by the officer, or by some miscellaneous motion to exclude. or 365(a). other disinterested person in the (f) Costs. Except as the Board may Count means the Board’s description presence of the officer, unless the order or the parties may agree in of the interfering subject matter that sets
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the scope of admissible proofs on claiming interfering subject matter to obvious the subject matter of a claim of priority. Where there is more than one the possibility of an interference. the opposing party and vice versa. count, each count must describe a (c) Examiner. An examiner may (b) Notice of declaration. An patentably distinct invention. require an applicant to add a claim to administrative patent judge declares the Involved claim means, for the provoke an interference. Failure to patent interference on behalf of the purposes of 35 U.S.C. 135(a), a claim satisfy the requirement within a period Director. A notice declaring an that has been designated as (not less than one month) the examiner interference identifies: corresponding to the count. sets will operate as a concession of (1) The interfering subject matter; Senior party means the party entitled priority for the subject matter of the (2) The involved applications, to the presumption under § 41.207(a)(1) claim. If the interference would be with patents, and claims; that it is the prior inventor. Any other a patent, the applicant must also comply (3) The accorded benefit for each party is a junior party. with paragraphs (a)(2) through (a)(6) of count; and Threshold issue means an issue that, this section. The claim the examiner (4) The claims corresponding to each if resolved in favor of the movant, proposes to have added must, apart count. would deprive the opponent of standing from the question of priority under 35 (c) Redeclaration. An administrative in the interference. Threshold issues U.S.C. 102(g): patent judge may redeclare a patent may include: (1) Be patentable to the applicant, and interference on behalf of the Director to (1) No interference-in-fact, and (2) Be drawn to patentable subject change the declaration made under (2) In the case of an involved matter claimed by another applicant or paragraph (b) of this section. application claim first made after the patentee. (d) A party may suggest the addition publication of the movant’s application (d) Requirement to show priority of a patent or application to the or issuance of the movant’s patent: under 35 U.S.C. 102(g). (1) When an interference or the declaration of an (i) Repose under 35 U.S.C. 135(b) in applicant has an earliest constructive additional interference. The suggestion view of the movant’s patent or reduction to practice that is later than should make the showings required published application, or the apparent earliest constructive under § 41.202(a) of this part. (ii) Unpatentability for lack of written reduction to practice for a patent or description under 35 U.S.C. 112(1) of an published application claiming § 41.204 Notice of basis for relief. involved application claim where the interfering subject matter, the applicant (a) Priority statement. (1) A party may applicant suggested, or could have must show why it would prevail on not submit evidence of its priority in suggested, an interference under priority. addition to its accorded benefit unless it § 41.202(a). (2) If an applicant fails to show files a statement setting forth all bases priority under paragraph (d)(1) of this on which the party intends to establish § 41.202 Suggesting an interference. section, an administrative patent judge its entitlement to judgment on priority. (a) Applicant. An applicant, including may nevertheless declare an (2) The priority statement must: a reissue applicant, may suggest an interference to place the applicant (i) State the date and location of the interference with another application or under an order to show cause why party’s earliest corroborated conception, a patent. The suggestion must: judgment should not be entered against (ii) State the date and location of the (1) Provide sufficient information to the applicant on priority. New evidence party’s earliest corroborated actual identify the application or patent with in support of priority will not be reduction to practice, which the applicant seeks an admitted except on a showing of good (iii) State the earliest corroborated interference, cause. The Board may authorize the date on which the party’s diligence (2) Identify all claims the applicant filing of motions to redefine the began, and believes interfere, propose one or more interfering subject matter or to change (iv) Provide a copy of the earliest counts, and show how the claims the benefit accorded to the parties. document upon which the party will correspond to one or more counts, (e) Sufficiency of showing. (1) A rely to show conception. (3) For each count, provide a claim showing of priority under this section is (3) If a junior party fails to file a chart comparing at least one claim of not sufficient unless it would, if priority statement overcoming a senior each party corresponding to the count unrebutted, support a determination of party’s accorded benefit, judgment shall and show why the claims interfere priority in favor of the party making the be entered against the junior party within the meaning of § 41.203(a), showing. absent a showing of good cause. (4) Explain in detail why the (2) When testimony or production (b) Other substantive motions. The applicant will prevail on priority, necessary to show priority is not Board may require a party to list the (5) If a claim has been added or available without authorization under motions it intends to file, including amended to provoke an interference, § 41.150(c) or § 41.156(a), the showing sufficient detail to place the Board and provide a claim chart showing the shall include: the opponent on notice of the precise written description for each claim in the (i) Any necessary interrogatory, relief sought. applicant’s specification, and request for admission, request for (c) Filing and service. The Board will (6) For each constructive reduction to production, or deposition request, and set the times for filing and serving practice for which the applicant wishes (ii) A detailed proffer of what the statements required under this section. to be accorded benefit, provide a chart response to the interrogatory or request § 41.205 Settlement agreements. showing where the disclosure provides would be expected to be and an a constructive reduction to practice explanation of the relevance of the (a) Constructive notice; time for filing. within the scope of the interfering response to the question of priority. Pursuant to 35 U.S.C. 135(c), an subject matter. agreement or understanding, including (b) Patentee. A patentee cannot § 41.203 Declaration. collateral agreements referred to therein, suggest an interference under this (a) Interfering subject matter. An made in connection with or in section but may, to the extent permitted interference exists if the subject matter contemplation of the termination of an under § 1.99 and § 1.291 of this title, of a claim of one party would, if prior interference must be filed prior to the alert the examiner of an application art, have anticipated or rendered termination of the interference between
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the parties to the agreement. After a the Board may issue judgment in, an claim on the basis of prior art is granted, final decision is entered by the Board, interference between an application and each of the movant’s claims an interference is considered terminated another application or patent that are corresponding to the same count as the when no appeal (35 U.S.C. 141) or other commonly owned. opponent’s claim will be presumed to review (35 U.S.C. 146) has been or can be unpatentable in view of the same § 41.207 Presumptions. be taken or had. If an appeal to the U.S. prior art unless the movant in its motion Court of Appeals for the Federal Circuit (a) Priority—(1) Order of invention. rebuts this presumption. (under 35 U.S.C. 141) or a civil action Parties are presumed to have invented (under 35 U.S.C. 146) has been filed the interfering subject matter in the order of § 41.208 Content of substantive and interference is considered terminated the dates of their accorded benefit for responsive motions. when the appeal or civil action is each count. If two parties are accorded The general requirements for motions terminated. A civil action is terminated the benefit of the same earliest date of in contested cases are stated at when the time to appeal the judgment constructive reduction to practice, then § 41.121(c). neither party is entitled to a expires. An appeal to the U.S. Court of (a) In an interference, substantive presumption of priority with respect to Appeals for the Federal Circuit, whether motions must: from a decision of the Board or a the other such party. (1) Raise a threshold issue, judgment in a civil action, is terminated (2) Evidentiary standard. Priority may when the mandate is issued by the be proved by a preponderance of the (2) Seek to change the scope of the Court. evidence except a party must prove definition of the interfering subject (b) Untimely filing. The Chief priority by clear and convincing matter or the correspondence of claims Administrative Patent Judge may permit evidence if the date of its earliest to the count, the filing of an agreement under constructive reduction to practice is (3) Seek to change the benefit paragraph (a) of this section up to six after the issue date of an involved patent accorded for the count, or or the publication date under 35 U.S.C. months after termination upon petition (4) Seek judgment on derivation or on 122(b) of an involved application or and a showing of good cause for the priority. failure to file prior to termination. patent. (c) Request to keep separate. Any (b) Claim correspondence. (1) For the (b) To be sufficient, a motion must party to an agreement under paragraph purposes of determining priority and provide a showing, supported with (a) of this section may request that the derivation, all claims of a party appropriate evidence, such that, if agreement be kept separate from the corresponding to the count are unrebutted, it would justify the relief interference file. The request must be presumed to stand or fall together. To sought. The burden of proof is on the filed with or promptly after the challenge this presumption, a party movant. agreement is filed. must file a timely substantive motion to (c) Showing patentability. (1) A party (d) Access to agreement. Any person, have a corresponding claim designated moving to add or amend a claim must other than a representative of a as not corresponding to the count. No show the claim is patentable. Government agency, may have access to presumption based on claim (2) A party moving to add or amend an agreement kept separate under correspondence regarding the grouping a count must show the count is paragraph (c) of this section only upon of claims exists for other grounds of patentable over prior art. petition and on a showing of good unpatentability. Dated: July 28, 2004. cause. The agreement will be available (2) A claim corresponds to a count if to Government agencies on written the subject matter of the count, treated Jon W. Dudas, request. as prior art to the claim, would have Acting Under Secretary of Commerce for anticipated or rendered obvious the Intellectual Property and Acting Director of § 41.206 Common interests in the subject matter of the claim. the United States Patent and Trademark invention. (c) Cross-applicability of prior art. Office. An administrative patent judge may When a motion for judgment of [FR Doc. 04–17699 Filed 8–11–04; 8:45 am] decline to declare, or if already declared unpatentability against an opponent’s BILLING CODE 3510–16–P
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Part III
Department of Labor Employment and Training Administration
20 CFR Part 603 Federal-State Unemployment Compensation Program (UC); Confidentiality and Disclosure of State UC Information; Proposed Rule
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DEPARTMENT OF LABOR not a toll-free number) or 1–877–889– only Section 303(f) (concerning IEVS) of 5627 (TTY), or by e-mail at the SSA, to implement all of these Employment and Training [email protected]. statutory provisions. (Section 303(f) Administration requires that each state UC agency SUPPLEMENTARY INFORMATION: provide for information to be requested 20 CFR Part 603 Background and exchanged with state and local RIN 1205–AB18 On March 23, 1992, the Employment agencies administering several federally and Training Administration (ETA) assisted programs for purposes of Federal-State Unemployment published a proposed rule (57 FR income and eligibility verification, in Compensation Program (UC); 10063) concerning the confidentiality accordance with a state system which Confidentiality and Disclosure of State and disclosure of state UC information. meets the requirements of Section 1137 UC Information The proposed rule was never finalized. of the SSA.) The disclosure provisions Commenters expressed different views that this rule would implement all AGENCY: Employment and Training require disclosure to government Administration, Labor. over how restrictive the rule should be, and some found the proposed rule entities, but they vary with respect to ACTION: Notice of Proposed Rulemaking the specific information to be disclosed unnecessarily lengthy and complex. (NPRM); request for comments. and the terms and conditions of Given the lapse of time, ETA has disclosure. SUMMARY: This proposed rule would set decided to publish a new proposed rule, This rule does not address the scope forth statutory confidentiality and described below. of the Secretary of Labor’s authority disclosure requirements of Title III of Discussion of Proposed Rule under Section 303(a)(6) of the SSA to the Social Security Act (SSA) and the require reports from the states. We note As explained below, ETA believes Federal Unemployment Tax Act (FUTA) this because the preamble to the 1992 that confidentiality protections for UC concerning unemployment proposed rule asked for comments information (meaning information in the compensation (UC) information. It concerning the scope of this provision. records of a state or state UC agency that would also amend the Income and We have decided not to address this pertains to the administration of state Eligibility Verification System (IEVS) matter in this proposed rule. regulations, a system of required UC law) are still necessary. Comments The confidentiality and disclosure information sharing primarily among on the 1992 proposal will become part requirements in Title III of the SSA state and local agencies administering of the new rulemaking record and were relating to UC information are several federally assisted programs. considered in developing this proposed conditions for receipt of grants by the DATES: Written comments must be rule. This proposed rule sets forth states for UC administration. The submitted on or before October 12, requirements very similar to those in the disclosure requirements in the FUTA 2004. 1992 proposal, but it would allow more are conditions required of a state in optional state disclosures. It would also order for employers in that state to ADDRESSES: Comments may be mailed now permit the Department to waive or delivered to Cheryl Atkinson, receive credit against the Federal safeguards and agreement requirements unemployment tax under 26 U.S.C. Administrator, Office of Workforce for disclosures to Federal agencies Security, Employment and Training 3302. which have in place adequate Other Federal laws may require use or Administration, U.S. Department of alternative safeguards for protecting the disclosure of confidential UC Labor, 200 Constitution Avenue, NW., confidentiality of information and an information. For example, the Room S–4231, Washington, DC 20210. appropriate method of paying or Workforce Investment Act (WIA) of Comments may be submitted reimbursing the state UC agency for 1998, Pub. L. 105–220, requires states to electronically to the Office of Workforce costs involved in such disclosures. In measure their progress in providing Security at the e-mail address: addition, this proposed rule is services funded under Title I of the WIA [email protected]. Receipt of streamlined. Whereas the text of the against state and local performance submissions, whether by U.S. mail, 1992 proposal contained 12 subparts measures using ‘‘quarterly wage records, other delivery, or e-mail, will not be and 77 sections, this proposal is consistent with State law.’’ 29 U.S.C. acknowledged. condensed into three subparts and 16 2871(f)(2); 20 CFR 666.150(a). Because All comments will be available for sections. Further, it uses plain language these laws do not condition receipt of public inspection and copying during and a user-friendly question-and-answer UC grants under the SSA or certification normal business hours at the Office of format. for employer tax credits under FUTA on Workforce Security, Employment and This proposed rule would implement such use or disclosure, this proposed Training Administration, U.S. Federal UC law provisions concerning rule would not implement these laws. Department of Labor, 200 Constitution confidentiality and disclosure of UC However, the disclosure of confidential Avenue, NW., Room S–4231, information and establish uniform UC information in compliance with the Washington, DC 20210. Copies of the minimum requirements for the payment WIA and other Federal laws would be proposed rule are available in alternate of costs, safeguards, and data-sharing permitted under the general exceptions formats of large print and electronic file agreements to ensure responsible use to confidentiality in § 603.5 of this on computer disk, which may be when UC information is disclosed. The proposed rule. (For more information on obtained at the above-stated address. confidentiality requirement the requirement to use wage records The proposed rule is also available at implemented by this rule is derived under the WIA, see 20 CFR 666.150.) the Web address http:// from Section 303(a)(1), SSA. The ETA strongly encourages states whose www.workforcesecurity.doleta.gov. disclosure requirements are from laws do not permit disclosure for WIA FOR FURTHER INFORMATION CONTACT: Sections 303(a)(7), (c)(1), (d), (e), (f), (h), purposes to amend their laws. Gerard Hildebrand, Chief, Division of and (i) of the SSA and Section We believe that these proposed Legislation, Office of Workforce 3304(a)(16), FUTA. This proposed rule regulations are necessary and important Security, Employment and Training would revise the regulations at 20 CFR for several reasons. The Federal Privacy Administration, (202) 693–3038 (this is Part 603, which currently implement Act does not protect the confidentiality
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of UC information even though it is the rule would require consent to be in the information was disclosed has been same type of information, wage and writing and contain features, such as served. Section 603.9(b)(1)(vii) would employment information, that is highly specific identification of the information require states to maintain a tracking protected when collected for the to be disclosed and the specific system sufficient to allow an audit of administration of other Federal purposes for the disclosure, ensuring compliance with this regulation’s programs, such as Social Security and the consent is truly informed. requirements. Section 603.10(b)(1)(vi) the Federal income tax. Except for its Access and amendment. Subjects of would require data-sharing agreements provisions governing the collection of an information collection should have to include provision for state on-site Social Security numbers, the Privacy the right to access and amend inspection of recipients to assure Act does not apply to state records information about them. This is compliance with the security containing UC information because they important to ensure the accuracy of safeguards. are not Federal records. Although state information that will be used to make Accountability. Mechanisms should laws address the privacy of such decisions about individuals (such as exist to ensure the accountability of records, they do so to varying degrees. eligibility for government benefits or individuals and entities handling At the same time, as mentioned, a services). UC information is used to confidential data. Section 603.4(c) of number of provisions of Federal law determine whether an individual is this proposed rule would require state now require use or disclosure of eligible for benefits or an employer is law to provide penalties for any confidential UC information. States liable for UC taxes. The opportunity to unauthorized disclosure of confidential have repeatedly sought guidance from access and amend UC information UC information. Section 603.9(b)(1)(v) the Department of Labor on usually occurs during the claims would require state agencies to inform confidentiality and disclosure issues. determination process or when tax employees of the applicable sanctions Further, several of the provisions in coverage decisions are made, because for unauthorized disclosures. Section Title III, SSA, instruct the Secretary of individuals and employers participate 603.9(a) would further require states or Labor to establish safeguards to protect and provide input into these processes. state agencies to subject recipients of the confidentiality of UC information Section 603.5(c) would also permit confidential UC information under data- when disclosed. states to provide individuals or sharing agreements to penalties The proposed rule is based on several employers access to UC information provided by state law for unauthorized ‘‘fair information’’ principles that are about themselves for non-UC purposes. disclosure. Section 603.10(c) would fundamental to any confidentiality Security safeguards. Security controls require suspension and ultimately policy and are reflected in a number of are important to protect the termination of any data-sharing sections throughout. The principles confidentiality and integrity of data, agreement or contract if a recipient fails include notice, choice, access and including data shared with other to follow the specified safeguards. This government agencies or recipients. amendment, security safeguards, and provision would also require states to Section 603.4(b) of this proposed rule accountability. take other action against an entity Notice. Subjects of an information would require states to maintain the violating a data-sharing agreement. collection (persons or organizations ‘‘confidentiality of any UC information from or about whom information is which reveals the name or any Section-by-Section Description of collected) should be notified what identifying particular about any Proposed Rule information is collected and of the individual or any past or present Subpart A—Confidentiality and possible uses of that information. Under employer or employing unit, or which Disclosure Requirements in General this proposed rule, state UC agencies could foreseeably be combined with would be required to inform claimants other publicly available information to Subpart A sets forth the purpose and and employers of the uses of UC reveal any such particulars’’ except as scope of the proposed rule, as well as information collected, including provided in this regulation. This would definitions that would apply to subparts possible non-UC uses. Specifically, require that state agencies employ B and C. Section 603.11 of this proposed rule effective methods to protect Section 603.1, Purpose and Scope would require states to provide confidentiality of UC information. These individualized notice to claimants at the methods may include management, This section describes the purposes time of filing an initial claim and operational, and technical security and scope of proposed new part 603, periodically thereafter, and to controls. which differ materially from the employers on their quarterly wage Section 603.9 would set forth purposes and scope of the present part report form or reimbursement billing, minimum security safeguards that state 603. While the present part 603 that confidential UC information may be agencies must require of recipients of addresses only the requirements requested and disclosed. A requirement disclosed data to ensure continued data concerning a state UC agency’s for notice to claimants exists in current confidentiality and integrity. For participation in the IEVS under Section part 603. This proposed rule would example, § 603.9(b)(1)(ii) and (iii) would 303(f) of the SSA, new part 603 would extend a notice requirement to require that information be stored in a address additional disclosure employers. place physically secure from access by requirements in Federal UC law and the Choice. To the extent possible, unauthorized persons and maintained basic requirement of confidentiality subjects of an information collection in a way that unauthorized persons derived from Section 303(a)(1) of the should have choices about how cannot obtain the information by any SSA. New part 603 would apply to information about them is used. means. Section 603.9(b)(1)(v) would states and state UC agencies, as defined Proposed § 603.5(c) and (d) would allow also require instruction of personnel in § 603.2(f) and (g). states to disclose information to an about confidentiality requirements and individual, employer, their agent or signed acknowledgments that the Section 603.2, Definitions attorney, or to another third party, on instruction occurred. Section This section defines the terms that the basis of informed consent. In the 603.9(b)(1)(vi) would require the return would apply to new part 603. case of disclosure to a third party other or destruction of disclosed UC Paragraph (a) defines ‘‘claim than an agent or attorney, the proposed information once the purpose for which information’’ as information about:
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• Whether an individual is receiving, include Employment Service offices or The proposed definition of ‘‘UC has received, or has applied for UC; state revenue departments except when information’’ and ‘‘state UC • The amount of compensation the administering a state’s UC law. information’’ does not include any individual is receiving or is entitled to However, officials of such agencies may information in a state Directory of New receive; be able to obtain access to UC Hires, even when the directory is • The individual’s current (or most information under the exception to maintained by the state UC agency, recent) home address; and, for purposes confidentiality for public officials, since these records are collected for of subpart C (concerning disclosure to under § 603.5(e). purposes of complying with Title IV, an IEVS), Paragraph (h) defines ‘‘state UC law’’ SSA (concerning Federal aid to states • Whether the individual has refused to mean the UC law of a state, approved for services to needy families with an offer of work and, if so, a description under the FUTA, 26 U.S.C. § 3304(a). children and for child-welfare services). of the job offered including the terms, Any law of a state (including official However, once information from a state conditions, and rate of pay; and interpretations thereof) that may affect directory is disclosed to the state UC • Any other information contained in state eligibility for Title III, SSA, agency for UC uses, the disclosed the records of the state UC agency that administrative grants or certification information becomes part of that is needed by the requesting agency to under the FUTA is part of the ‘‘state UC agency’s UC information, and that verify eligibility for, and the amount of, law’’ as defined in this proposed rule. information would be subject to this benefits. This definition is not intended to cover proposed rule. Paragraph (b) defines ‘‘confidential Wagner-Peyser Act-funded programs or Further, the definition does not UC information’’ and ‘‘confidential programs funded under the WIA. include the personnel or fiscal information’’ as any UC information Paragraph (i) defines ‘‘unemployment information of a state UC agency. In required to be kept confidential under compensation (UC)’’ as cash benefits to addition, the proposed definition of § 603.4. individuals with respect to their ‘‘UC information’’ and ‘‘state UC Paragraph (c) defines ‘‘public domain unemployment. information’’ does not include Paragraph (j) defines ‘‘UC information’’ as: information about employment service • Information about the organization information’’ and ‘‘state UC activities or job training activities, even of the state and the state UC agency and information’’ as information in the though such activities may be appellate authorities, including the records of a state or state UC agency that performed within the same umbrella names and positions of officials and pertains to the administration of the agency where UC activities are employees thereof; state UC law. This definition includes • Information about the state UC law information pertaining to the performed, because such information (and applicable Federal law) provisions, administration of the state UC law does not pertain to the administration of rules, regulations, and interpretations regardless of whether that information is the state UC law. thereof, including statements of general housed by the state UC agency. For Finally, the definition does not policy and interpretations of general example, the definition includes include records of the following Federal applicability, appeals records and employer UC tax rates, UC tax UC and benefit programs: the decisions, and precedential identification numbers, and claimant Unemployment Compensation for determinations on coverage of weekly benefit amounts, even when Federal Employees (UCFE) program (5 employers, employment, and wages; those records are housed by a tax U.S.C. 8501–8508); the Unemployment and agency. Compensation for Ex-Servicemembers • Any agreement of whatever kind or The definition also includes state (UCX) program (5 U.S.C. 8521–8525); nature, including interstate wage reports, collected under the IEVS the Trade Adjustment Assistance (TAA) arrangements and reciprocal agreements required by Section 1137, SSA, that are and Alternative Trade Adjustment and any agreement with the Department obtained by the state UC agency for Assistance (ATAA) programs (19 U.S.C. of Labor or the Secretary, relating to the determining UC monetary eligibility or 2271–2321); the NAFTA Transitional administration of the state UC law. are downloaded to the state UC agency’s Adjustment Assistance (NAFTA-TAA) Paragraph (d) defines ‘‘public official’’ files as a result of a crossmatch. It does program (19 U.S.C. 2331) (which is as an official, agency, or public entity not include IEVS records collected by a being phased out); and the Disaster within the executive branch of Federal, state tax department that are neither Unemployment Assistance (DUA) state, or local government who (or used for determining UC eligibility nor program (42 U.S.C. 5171); or any which) has responsibility for downloaded to the state UC agency’s Federal UC benefit extension program. administering or enforcing a law, or a files. Section 1137(a)(5)(B), SSA, gives This is because such information legislator in the Federal, state, or local the Secretary of Health and Human pertains to the administration of government with oversight Services (HHS) primary authority to Federal, not state, UC law and is responsibility for the UC program. establish safeguards to protect IEVS covered by other regulations, operating Paragraph (e) defines ‘‘Secretary’’ and records against ‘‘unauthorized instructions, and agreements with ‘‘Secretary of Labor’’ to mean the disclosure for other [non-IEVS] states. cabinet officer heading the United States purposes.’’ The Department of Labor has Paragraph (k) defines ‘‘Wage Department of Labor, or his or her authority only to establish safeguards information’’ to mean information in the designee. for IEVS records ‘‘in the case of the records of a state UC agency (and, for Paragraph (f) defines ‘‘state’’ to mean unemployment compensation program,’’ purposes of § 603.23, information one of the ‘‘states’’ included in the and under Title III, SSA. Thus, the reported under provisions of state law federal-state UC program, including Department of Labor is responsible for which fulfill the requirements of Puerto Rico, the United States Virgin establishing safeguards only with Section 1137 of the SSA) about the Islands, and the District of Columbia. respect to IEVS records obtained by a wages paid to an individual, the Social Paragraph (g) defines ‘‘state UC state UC agency for determining benefit Security account number (or numbers) agency’’ to mean an agency charged eligibility, or copies of IEVS records that of such individual, and the name, with administration of a state’s UC law. have been disclosed to the state UC address, state, and Federal employer The proposed definition does not agency as a result of a crossmatch. identification number of the employer
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who paid such wages to such The confidentiality requirement has the disclosure provisions of proposed individual. its origin in the beginning of the part 603 to state-held information from program and is derived from Section the Federal UC and benefit programs of Subpart B—Confidentiality and 303(a)(1) of the SSA. Section 303(a)(1), UCFE, UCX, TAA and ATAA (except, as Disclosure Requirements SSA, requires states to provide in their described in the following paragraph, Subpart B sets forth the basic laws for such ‘‘methods of for confidential business information proposed requirement of confidentiality, administration’’ as the Secretary of held by the states under the TAA permissible exceptions to the rule of Labor determines are ‘‘reasonably program), and DUA, as well as to state confidentiality, and mandatory calculated to insure full payment of UC information. disclosure requirements. It also unemployment compensation when The disclosure provisions of proposed proposes requirements on: (1) Payment due.’’ From the early years of the part 603 would not apply, however, to of costs (for disclosures of UC program this provision has been the confidential business information information which are not made in the interpreted to require the confidentiality that the states collect under the TAA course of the administration of the state of information collected from program, as reauthorized by the Trade UC laws), (2) safeguards, (3) agreements individuals and employers for UC Act of 2002, P.L. 107–210, or collected between the state UC agency and program administration. Confidentiality under the NAFTA–TAA program, which agencies or entities requesting is necessary to avoid deterring is being phased out. A state may, under confidential UC information, which set individuals from claiming benefits or the reauthorized and expanded TAA forth the terms and conditions for exercising their rights, to encourage program, collect confidential business making such disclosures and the employers to provide information information upon request by the remedies that apply in the case of necessary for program operations, to Secretary of Labor under authority of breach of an agreement, and (4) avoid interference with the Section 221(a)(2) of the Trade Act (19 conformity and substantial compliance administration of the UC program, and U.S.C. 2271(a)(2)), which requires a with this proposed rule. to avoid notoriety for the program if state to ‘‘assist’’ the Secretary of Labor in the review of a petition for Section 603.3, Purpose and Scope program information were misused. Although the Department of Labor’s certification of eligibility to apply for This section sets forth the purpose interpretation of Section 303(a)(1), SSA, benefits by ‘‘verifying such information and scope of proposed subpart B. It as requiring confidentiality is and providing such other assistance as expressly states that the purpose of longstanding, it has not previously been the Secretary may request.’’ This subpart B is to set forth the set forth in regulations. However, information concerns changes in sales requirements of Section 303(a)(1) of the Unemployment Insurance Program or production, imports of competitive SSA, as such requirements concern the Letters (UIPLs) 23–96 (‘‘Disclosure of articles, and shifts in production. confidentiality of state UC information, Confidential Employment Information Employers and their customers would to implement the disclosure to Private Entities’’) and 34–97 be very reluctant to disclose this requirements of Sections 303(a)(7), (‘‘Disclosure of Confidential business information to the state were it (c)(1), (d), (e), (h), and (i), SSA, and Unemployment Compensation subject to disclosure under the proposed Section 3304(a)(16), FUTA, and to Information’’), which would be exceptions to confidentiality in § 603.5 establish uniform minimum superseded upon completion of this or the mandatory disclosure requirements for the payment of costs, Rulemaking, set forth the confidentiality requirements of § 603.6. A proposed safeguards, data-sharing agreements requirement. rulemaking to implement the when UC information is disclosed, and The confidentiality requirement reauthorized TAA program will address conformity and substantial compliance would apply, by its express terms, only the confidentiality of this business with this proposed rule. Subpart B to state information. (‘‘UC information’’ information. would apply to states and state UC is information that ‘‘pertain[s] to Paragraph (c) would require each state agencies, as defined in § 603.2(f) and (g). administration of the State UC law law to contain provisions that are ***’’. (Emphasis added.)) interpreted and applied consistently Section 603.4, Confidentiality Nevertheless, the regulations and with the requirements of this subpart Requirement of Federal UC Law operating instructions governing the and provide for penalties for any Paragraph (a) of § 603.4 quotes the Federal UC and benefit programs of disclosure of confidential information ‘‘methods of administration’’ UCFE, UCX, TAA, ATAA and DUA that is inconsistent with any provision requirement of Section 303(a)(1) of the require states to apply the same state of this subpart. SSA, which is the basis for the law confidentiality protections that confidentiality requirement. apply to state UC program information Section 603.5, Exceptions to the Paragraph (b) sets forth the to information of those Federal UC and Confidentiality Requirement Department’s interpretation of Section benefit programs. (See UCFE—20 CFR This section sets forth the permissible 303(a)(1), SSA, as including a basic 609.13(b); UCX—20 CFR 614.14(b); TAA exceptions to the confidentiality requirement of confidentiality. It would and ATAA—20 CFR 617.57(b); and requirement. Disclosure would be require states to maintain the DUA—20 CFR § 625.16(b).) Thus, in permissible under exceptions at confidentiality of any UC information order to fulfill their responsibilities paragraphs (a) through (g) only if which reveals the name or any under the respective Federal program authorized by state law and if the state identifying particular about any regulations and their administrative determines the resources required for individual or any past or present agreements with the Secretary of Labor, such disclosure does not interfere with employer or employing unit, or which the states would need to apply the the efficient administration of the state could foreseeably be combined with confidentiality protections of state law UC program and law. Disclosure is other publicly available information to conforming with these part 603 permissible under exceptions (h) reveal any such particulars, and to proposed regulations to UCFE, UCX, through (j) without such restriction. include provision for barring the TAA, ATAA and DUA program Paragraph (a) would provide that disclosure of any such information, information. In addition, in accordance information in the public domain, as except as provided in new part 603. with § 603.6, states would need to apply defined in § 603.2(c), is not covered by
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the confidentiality requirement. This authorized under this exception. As a The principle behind disclosure to a means it would be up to the state to result, prior to any disclosure under this third party on the basis of informed determine whether and how much of paragraph, states are expected to take consent is that individuals and such information is open to the public reasonable measures to assure that no employers should be able to waive their or is kept confidential. impermissible redisclosure occurs. If, privacy when they believe it is in their Some UC information, such as for example, information is provided to interest to do so. The confidentiality employer names and addresses, is another state’s UC agency, this may be requirement exists to serve the interests public in the sense that it is available as simple as assuring that a state’s laws of individuals and employers as well as from other public sources like telephone contain similar confidentiality the needs of the federal-state UC directories but is not public domain requirements. In the case of disclosure program. However, as described, information for purposes of this rule. to an agent or contractor, such as a additional conditions would be required Appeals hearing records and collections agency, this means building because of the greater potential threat to decisions are included in the definition confidentiality requirements and employer or individual privacy posed of ‘‘public domain information’’ and, safeguards into the contract. by third-party collection, storage, therefore, would be excluded from the Paragraph (c) would permit disclosure maintenance, use, and possible misuse confidentiality requirement. The of UC information about an individual of confidential UC information. This Department of Labor has historically to that individual, or of UC information question is dealt with in Unemployment stated, and repeats here, that the public about an employer to that employer. Insurance Program Letter 23–96 interest in proper administration of the Paragraph (d) would permit (‘‘Disclosure of Confidential UC program, specifically in payments of disclosure of UC information on the Employment information to Private benefits only to eligible individuals, and basis of informed consent to: (1) An Entities,’’ 61 FR 28236), which would be in open governmental adjudicatory agent or attorney of an individual, of superseded upon completion of this proceedings (to preserve a fair process information that pertains to that rulemaking. to claimants and employers by avoiding individual, or to an agent or attorney of Finally, the Electronic Signatures in star-chamber-type proceedings), is an employer, of information that Global and National Commerce Act of served by open hearings and hearing pertains to that employer, and (2) to a 2000 (E-Sign), P.L. No. 106–229, may records. However, nothing in the third party only if that entity obtains a apply where one or more parties wish proposed rule would prohibit states written release from the individual or to use an electronic informed consent from making agency hearings or hearing employer to whom the information release (§ 603.5(d)) or a disclosure records confidential as a matter of state pertains. In the case of disclosures to an agreement (§ 603.10). E-Sign, among law or practice. other things, sets forth the Paragraph (b) would provide that the agent or attorney, the agent or attorney must present a written release from the circumstances under which electronic confidentiality requirement does not signatures, contracts, and other records individual or employer being apply to essential program activities, relating to such transactions (in lieu of represented, or, if a written release is e.g. those activities relating to the taking paper documents) are legally binding. impossible or impracticable to obtain, of claims for UC, the determination of Thus, an electronic communication may such other form of consent as is eligibility (including appeals), the suffice under E-Sign to establish a permitted by the state UC agency in payment of benefits, the determination legally binding contract. The states accordance with state law. In the case of of employer liability, the collection of would need to consider E-Sign’s disclosures to a third party, the release amounts due the state’s unemployment application to these informed consent must be signed and must include the fund, or any other activity directly releases and disclosure agreements. In related to the administration of the UC following statements: • particular, a state must, to conform and program. As a specific example, Section Specific identification of the substantially comply with this proposed 303(g), SSA, permits states to withhold information that is to be disclosed; • regulation, assure that these informed UC payable under state laws to recover That state government files will be consent releases and disclosure overpayments of benefits made to accessed to obtain that information; • agreements would be legally individuals by another state or to The specific purpose or purposes enforceable. If an informed consent recover an overpayment of state UC for which the information is sought and release or disclosure agreement is to be from a payment made under a Federal a statement that information obtained effectuated electronically, the state unemployment benefit or allowance under the release will be used only for would have to determine whether E- program if the state has entered into an that purpose or purposes; and Sign applies to that transaction, and, if • agreement with the Secretary of Labor The parties who may receive the so, make certain that the transaction under Section 303(g)(2), SSA, and if it information released. satisfies the conditions imposed by E- reciprocally recovers overpayments The purpose specified in the release Sign. The state would also be required made under a Federal unemployment must be limited to providing a service to make certain that the electronic benefit or allowance program from state or benefit to the individual signing the transaction complies with every other payments. Disclosure of information release that such individual expects to condition necessary to make it legally which is necessary for purposes of receive as a result of signing the release, enforceable. A note following proposed carrying out these interstate and cross- or carrying out administration or § 603.5(d) explains this. program recoveries is permissible under evaluation of a public program to which Paragraph (e) would allow disclosure this section (and, as discussed below, the release pertains. Further, payment of of UC information to a public official in such disclosure is required under costs, safeguards, and agreements would the performance of his or her official § 603.6(a)). be required, as provided in proposed duties. Since the 1970s, the Department The Department of Labor emphasizes §§ 603.8 through 603.10. Also, the states of Labor’s guidance to states has that paragraph (b) applies only when would be required by proposed §§ 603.9 recognized this exception, which allows disclosure is necessary for the proper and 603.10 to impose certain penalties for a variety of uses of UC information administration of the UC program. for misuse of data, additional audits, that ETA believes are beneficial, such as Redisclosure by a recipient for any and additional terms in disclosure law enforcement, fraud and benefit separate or non-essential purpose is not agreements. accuracy in programs not addressed by
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Federal UC law (for example, Black Paragraph (g) would provide that the Revenue Service for purposes of UC tax Lung and state workers’ compensation confidentiality requirement does not administration or to the Bureau of programs), program assessment (for apply to information collected Citizenship and Immigration Services example, of WIA and Vocational exclusively for statistical purposes (formerly the Immigration and Education programs), and research. under a cooperative agreement with the Naturalization Service) for purposes of ‘‘Performance of official duties’’ Bureau of Labor Statistics (BLS) and that verifying a claimant’s immigration means administration or enforcement of part 603 would not restrict or impose status. It also requires disclosure for law or, in the case of the legislative any condition on the transfer of any purposes of interstate and cross-program branch, oversight of UC law. It does not other information to the BLS under an offsets under Section 303(g), SSA. mean the conduct of research by an agreement, or the BLS’s disclosure or Paragraph (b) covers other provisions individual at a public or private use of such information. of Federal UC law, with the exception university, although, where appropriate, Transfers of information to the BLS of Section 303(f), concerning an IEVS, a researcher could obtain access to would be excepted from the which is addressed in subpart C, that confidential UC information under the confidentiality requirement because the specifically require disclosure of certain exceptions provided for in paragraph (f) conditions under which they occur state UC information and state-held (agent or contractor of a public official) already satisfy the requirements of the Federal UC benefit information. These or (d)(2) (disclosure to a third party on confidentiality rule, and ETA does not provisions include Sections— the basis of informed consent), wish to interfere with the BLS’ existing • 303(a)(7), SSA, which requires state discussed elsewhere. ETA believes that agreements or the ability of the BLS to law to provide for making available, there is less risk of unauthorized use or carry out its statistical programs. upon request, to any agency of the disclosure of UC information if Specifically, safeguards, agreements, United States charged with the responsibility for safeguarding and payment of costs are already in administration of public works, or confidentiality rests within the place. The BLS applies strict safeguards assistance through public employment, executive or legislative branches of to protect the confidentiality of the name, address, ordinary occupation, government. ETA also believes that information it receives. It also funds and employment status of each recipient limiting access within the legislative states for collection and disclosure of of UC, and statement of such recipient’s branch to those legislators who need the information. Finally, transfers of rights to further compensation under information to help oversee the UC information to the BLS are governed by state law. program further minimizes the agreements that provide assurance that • 303(c)(1), SSA, which requires each possibility of unauthorized use. these safeguards will be followed. state to make its UC records available to Paragraph (h) would permit the Railroad Retirement Board, and to Paragraph (f) would allow disclosure disclosure of UC information in furnish such copies of its UC records to of UC information to an agent or response to a court order, or to an the Railroad Retirement Board as the contractor of a public official to whom official with subpoena authority, as Board deems necessary for its purposes. disclosure is permissible under specified in § 603.7(b). paragraph (e). This provision takes into Paragraph (i) would permit disclosure This statutory provision requires a state account that research is often contracted of UC information as required by to make ‘‘its records’’ available to the out by public agencies. If confidential Federal law. Railroad Retirement Board. Because UC information could not be disclosed Section 303 concerns state to agents or contractors of public Section 603.6, Disclosures Required by administration of the federal-state UC officials, valuable research might be Federal UC Law program, we interpret use of the term forgone or become more expensive, as This section lists disclosures required ‘‘records’’ in Section 303(c)(1) to limited agencies would have to undertake by Federal UC law. These requirements to disclosure of UC records and not to interviews of program participants in apply to state UC information as well as include other records of the state. order to gather program evaluation to information from the Federal UC and • 303(d)(1), SSA, which requires each information. A public official, ideally benefit programs of UCFE, UCX, TAA state UC agency, for purposes of one with responsibility for the program and ATAA (except for the confidential determining an individual’s eligibility or initiative on which research is being business information compiled by the benefits, or the amount of benefits, conducted, would be required to enter states under the TAA program), DUA, under a food stamp program established into the written agreement required by and any Federal extended UC benefit under the Food Stamp Act of 1977, to proposed § 603.10 and be held program. These statutory requirements, disclose, upon request, to officers and responsible for use of the information by by their terms, require disclosure of employees of the Department of the contractor or agent. Redisclosure of information maintained regarding these Agriculture and state food stamp such information by a public official to Federal programs, as well as state UC agencies, any of the following an agent or contractor would be information, either because they information contained in the records of permitted only as provided in proposed specifically state that they include such such state agency— § 603.9(c). Federal information or are written (i) Wage information, When possible, states should provide broadly enough to cover it. The utility (ii) Whether an individual is non-confidential information to of the information exchanges listed in receiving, has received, or has made researchers in lieu of confidential this section would be impeded if this application for, UC, and the amount of information. State agencies may, for Federal information was not included in any such compensation being received, example, encrypt identifiers before them. or to be received, by such individual, providing data to a researcher so that Paragraph (a) sets forth the (iii) The current (or most recent) home the researcher cannot identify Department of Labor’s interpretation of address of such individual, and individuals or employers. The agency Section 303(a)(1) of the SSA as requiring (iv) Whether an individual has could add subsequent years of data for disclosure of all information necessary refused an offer of employment and, if the researcher using the same for the proper administration of the UC so, a description of the employment so encryption so that the researcher can program. This paragraph requires, for offered and the terms, conditions, and conduct longitudinal studies. example, disclosure to the Internal rate of pay therefore.
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• 303(e)(1), SSA, which requires each (ii) Whether the individual is state UC agency to file and pursue a state UC agency to disclose, upon receiving, has received, or has made motion to quash, in the appropriate request, directly to officers or employees application for, UC, and the amount of forum, when a subpoena or other of any state or local child support any such compensation being received compulsory process of a lawful enforcement agency, any wage (or to be received) by such individual. authority, which requires the information contained in the records of Section 303(i)(2) states that the production of or appearance for the state UC agency for purposes of ‘‘Secretary of Labor shall prescribe testimony about confidential UC establishing and collecting child regulations governing how often and in information, is served upon the state UC support obligations from, and locating, what form information may be disclosed agency or the state. If such a motion individuals owing such obligations. under paragraph (1)(A)’’ of Section were denied, after a hearing in the As explained in detail in UIPL 45–89 303(i). However, what is a useful appropriate forum, confidential UC (55 FR 1886, January 19, 1990), Section frequency and format for such information may be disclosed, but only 303(e)(1) limits required disclosure to disclosure depends upon the needs of a upon such terms as the court or other use for purposes of establishing ‘‘child particular requesting agency (in the case forum may order, including that the support obligations’’ being enforced by of Section 303(i), either HUD or a recipient protect the disclosed a child support enforcement agency. particular public housing agency) and information and pay the state’s or state Accordingly, state UC agencies would the amount the agency is willing to UC agency’s costs of disclosure. not be required to disclose information reimburse the UC agency for providing The proposed exceptions are, first, for purposes related to support the information. These will vary where a court has previously issued a obligations for the custodial parent of depending upon the circumstances of binding precedential decision that the child receiving services from the the particular requesting agency and the requires such disclosures and, second, child support enforcement agency. The state or locality in which it operates. when confidential UC information is Department intends to pursue The preferences of the requesting requested by an official of state or legislation that would expand the agency may also change over time, along Federal government, other than a clerk purposes for which disclosure of wage with changes in technology. Thus, in of court on behalf of a litigant, with information (as well as intercept of UC) order to provide states and localities authority to obtain the information by is required under Section 303(e) to with needed flexibility, and to avoid subpoena under state or Federal law. include enforcement of custodial parent drafting regulatory requirements that These proposed exceptions recognize support. In the meantime, however, may need frequent revision, we have that filing a motion to quash in these State UC agencies are encouraged to chosen not to regulate the frequency and circumstances may indeed be futile and disclose information related to such format of disclosures at this time. a waste of administrative resources. obligations under the optional • 3304(a)(16), Federal Unemployment They would also facilitate state disclosure permitted under § 603.5(e). Tax Act (FUTA), which requires each cooperation with law enforcement. • 303(h), SSA, which requires each state UC agency— We believe that filing motions to state UC agency to disclose quarterly, to (i) To disclose, upon request, to any quash subpoenas involving the the Secretary of Health and Human state or political subdivision thereof disclosure of confidential UC Services (HHS), wage information and administering a TANF program funded information is an important means of claim information as required under under part A of Title IV of the SSA, avoiding unnecessary or unlawful Section 453(i)(1) of the SSA wage information contained in the disclosures, which might deter (establishing the National Directory of records of the state UC agency which is claimants from exercising their rights or New Hires), contained in the records of necessary (as determined by the employers from providing information. such agency, for purposes of Secretary of HHS in regulations), for Where the exceptions apply, a state may Subsections (i)(1), (i)(3), and (j) of purposes of determining an individual’s still file such a motion if warranted, or Section 453, SSA (establishing the eligibility for TANF assistance or the may file a motion to require that the National Directory of New Hires and its amount of TANF assistance; and recipient protect the disclosed uses for purposes of child support (ii) To furnish to the Secretary of information or for reimbursement of enforcement, Temporary Assistance to HHS, in accordance with that costs. (As described in proposed Needy Families (TANF), TANF Secretary’s regulations at 45 CFR § 603.8(b), seeking reimbursement in research, administration of the earned 303.108, wage information (as defined at some manner would be required if grant income tax credit, and use by the Social 45 CFR 303.108(a)(2)) and UC funds are used to cover the costs of the Security Administration). information (as defined at 45 CFR disclosure.) If the state law is • 303(i), SSA, which requires each 303.108(a)(3)) contained in the records sufficiently rigorous concerning the state UC agency to disclose, upon of such agency for the purposes of the release of confidential UC information, request, to officers or employees of the National Directory of New Hires the courts may be less inclined to Department of Housing and Urban established under Section 453(i) of the enforce subpoenas; so, states may wish Development (HUD) and to SSA. to review their state laws in this regard. representatives of a public housing Paragraph (c) would require each state To conserve time and funds, states may agency, for purposes of determining an law to contain provisions that are wish to pursue a motion to quash by individual’s eligibility for benefits, or interpreted and applied consistently mail or by telephone if permitted by the amount of benefits, under a housing with this section. state law. assistance program of HUD, any of the following UC information contained in Section 603.7, Subpoenas, Other Section 603.8, Payment of Costs; the records of such state agency about Compulsory Process, and Disclosure to Program Income any individual applying for or Officials With Subpoena Authority This section would set forth rules on participating in any housing assistance This section sets forth the Department the use of UC grant funds for disclosures program administered by HUD who has of Labor’s long-standing position on of UC information, recovery of the signed a consent form approved by the state responses to subpoenas and other state’s and state UC agency’s costs for Secretary of HUD— compulsory processes. With two disclosing information not made in the (i) Wage information, and exceptions, it would require the state or course of the administration of the UC
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program, and use of program income. It denied recovery of costs, or to officials CFR 97.25(g) (on program income). would require payment of costs for any with subpoena authority under Program income may not be used to disclosures made for purposes other § 603.7(b)(2) if the state UC agency has benefit a state’s general fund or another than administration of the UC program, attempted but not been successful in program. with limited exceptions for requests obtaining reimbursement of costs. Section 603.9, Safeguards for Disclosed involving incidental costs and some Paragraph (c) sets out how costs Information situations involving subpoenas. The would have to be calculated. Costs statutory principle underlying these would be required to be calculated in This proposed section sets forth the rules is that funds granted under Title accordance with the cost principles and safeguards that states and state UC III of the SSA for the administration of administrative requirements of 29 CFR agencies would have to require of the state UC law may not be used for part 97 and Office of Management and recipients who obtain confidential UC other purposes. This is required by the Budget Circular No. A–87 (Revised). information under: §§ 603.5(d)(2) explicit statutory terms of Section 302(a) Costs would be required to be charged (disclosure to a third party on the basis of the SSA (providing for payments to to and paid by the recipient and would of informed consent); (e) (disclosure to states for ‘‘proper and efficient include any initial start-up costs a public official), except as provided in administration’’ of state UC law), incurred by the state UC agency, such as paragraph (d) of this section; (f) Section 303(a)(8) of the SSA (limiting computer reprogramming required to (disclosure to an agent or contractor of expenditure of UC grants to amounts respond to a request, and the costs of a public official); § 603.6(b)(1) through necessary for ‘‘proper and efficient implementing safeguards and (4), (6), and (7)(i) (disclosures required administration’’ of state UC law), and agreements required by §§ 603.9 and by Federal UC law, except for Section 303(a)(9) of the SSA (requiring 603.10. (Start-up costs would not disclosures to HHS under Sections repayment to the Secretary Labor of any include the costs to the state UC agency 303(h), SSA, and 3304(a)(16)(B), FUTA); funds expended for purposes other than, of obtaining, compiling, or maintaining or § 603.22 (to a requesting agency for or in amounts in excess of, those information for its own purposes.) purposes of an IEVS). These safeguards necessary for the proper administration Postage or other delivery costs incurred are similar to those in present part 603 of state UC law). It is a conformity in making any disclosure would be part that currently apply to disclosures requirement for approved state laws and of the costs of making the disclosure. under an IEVS but have been simplified is a substantial compliance requirement Penalty mail, as defined in 39 U.S.C. to provide flexibility to states. They for the states and state UC agencies 3201(1), must not be used to transmit would preclude the unauthorized use, under Section 303(b) of the SSA. Thus, information being disclosed, except access, and redisclosure of the even if a required disclosure in Title III, when the disclosure is made for information. SSA, or Section 3304(a)(16) does not purposes of administration of the UC Not all the disclosure requirements of explicitly require payment of costs, such program. By statute (Sections 453(e)(2) Title III, SSA, referred to above payment is required by this section and 453(g) of the SSA), the Secretary of explicitly require safeguards, but under authority of the sections of Title HHS has the authority to determine Section 303(a)(1), SSA, provides a basis III, SSA, mentioned above. what constitutes a reasonable amount for the requirement. Safeguards protect Paragraph (a) of § 603.8 sets forth the for the reimbursement for disclosures against the misuse or improper general rule prohibiting the use of grant under Sections 303(h), SSA, and redisclosure of disclosed information funds to pay any of the costs of making 3304(a)(16)(B), FUTA. and, therefore, like the confidentiality any disclosure except as provided in Paragraph (d) would require the requirement itself, maintain claimant paragraph (b). It also specifies that grant payment of costs, calculated in and employer confidence in the UC funds may not be used to pay any of the accordance with paragraph (c), to be system and their willingness to costs of making any disclosures for non- paid by and collected from the recipient participate and cooperate in its UC purposes under § 603.5(e) (to a of the information either in advance or administration. This participation and public official), § 603.5(f) (to an agent or by way of reimbursement. If the cooperation is essential to the system’s contractor of a public official), § 603.5(g) recipient is not a public official, such effective administration. Requiring (to BLS), § 603.6(b) (as required by costs, except for good reason, would be safeguards is therefore a ‘‘method of Federal UC law for non-UC purposes), required to be paid and collected in administration’’ reasonably calculated or § 603.22 (to HHS or a requesting advance. Payment in advance would to insure full payment of UC when due. agency for purposes of an IEVS)). mean full payment of costs before or at Paragraph (a) sets forth the general Paragraph (b) sets out the exceptions the time the disclosed information is rules, which would require the state or when use of grant funds would be given in hand or sent to the recipient. state UC agency to require that the permitted to pay the costs of ETA’s intention is that the ‘‘good recipient of disclosed information disclosures. Grant funds may be used to reason’’ exception generally be safeguard the information against pay the costs of disclosures made for associated with disclosures involving unauthorized access or redisclosure as purposes of administration of the UC minimal costs. provided in paragraphs (b) and (c), and program (which may include some The requirement for payment of costs that the recipient be subject to penalties disclosures under §§ 603.5(a) (public would be met when a state UC agency provided by the state law for domain information), (c) (to an has in place a reciprocal data-sharing unauthorized disclosure. individual or employer), or (d) (on the agreement or arrangement with another Paragraph (b) sets forth safeguards basis of informed consent)). Grant funds agency or entity. ‘‘Reciprocal’’ means that the state or state UC agency would may also be used to pay the costs of that the relative benefits received by have to require of recipients. disclosures made in response to each party to the agreement or Paragraph (b)(1)(i) would require requests involving only incidental staff arrangement are approximately equal. states or state UC agencies to require time and no more than nominal Paragraph (e) would provide that recipients to use the disclosed processing costs, and for disclosures in reimbursed costs and any funds information only for purposes response to subpoenas under generated by the disclosure of authorized by law and consistently with § 603.7(b)(1) (when a court decision information are program income and an agreement that meets the requires disclosure) if a court has may be used only as permitted by 29 requirements of § 603.10.
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Paragraph (b)(1)(ii) would require the making a disclosure, the costs of of the confidential UC information by recipient to store the disclosed tracking should be reflected in the the agent or contractor. information in a place physically secure amount charged to the recipient. As a • By one public official to another from access by unauthorized persons. result, tracking, like other provisions in public official (paragraph (c)(1)(vi)). Paragraph (b)(1)(iii) would require the this proposed rule, should not increase This provision would take into account recipient to store or process disclosed costs for state UC agencies. situations in which public officials in information maintained in electronic Paragraph (b)(2) would specifically different agencies or in different states format, such as magnetic tapes or discs, require the state to conduct, in the case need to share confidential UC in such a way that unauthorized persons of optional disclosures to entities on the information with each other in the cannot obtain the information by any basis of informed consent course of administering a public means. (§ 603.5(d)(2)), a periodic audit of program. • Paragraphs (b)(1)(ii) and (iii) can be sample transactions to assure that the Of wage information from state and met by, among other things, placing entity receiving information has on file local child support enforcement paper files in a locked cabinet or room, a written release authorizing each agencies to agents under contract with and in the case of information access. The audit would be required to such agencies for purposes of carrying maintained electronically, using ensure that the information is not being out child support enforcement, electronic passwords or computer used for any unauthorized purpose. consistent with Section 303(e)(5) of the encoding to block access by This provision would also require that SSA (paragraph (c)(1)(vii)) and state unauthorized persons. all employees of entities receiving law. Though proposed paragraph Paragraph (b)(1)(iv) provides for access to information pursuant to (c)(1)(vii) covers only wage information, precautions to ensure that only § 603.5(d)(2) be subject to the same redisclosure of other confidential UC authorized personnel are given access to confidentiality requirements, and state information between a state or local disclosed information stored in criminal penalties for violation of those child support enforcement agency and computer systems. requirements, as are employees of the its contractor or agent would be Paragraph (b)(1)(v) would require state UC agency. permitted by paragraph (c)(1)(v). each recipient agency to give specified • By an entity that has obtained The safeguards in proposed paragraph instructions to all personnel having confidential UC information on the (b) do not address specific or new access to the disclosed information and basis of informed consent, when to sign an acknowledgment that all such technologies used in storing and sharing authorized by the state and by a written personnel have been so instructed and confidential UC information. release from the individual or employer that they will adhere to the state’s or Nevertheless, these safeguards would be to whom the information pertains that state UC agency’s confidentiality applicable to disclosures of confidential meets the requirements of proposed requirements and procedures which are UC information no matter what medium § 603.5(d)(2) (paragraph (c)12(1)(viii)). consistent with subpart B and the of storing and sharing the information is The redisclosure provisions would agreement required by § 603.10, and used. ETA encourages efficient use of allow sharing of confidential UC will report any infractions to the state technologies in storage, retention, and, information by a public official to an UC agency. where appropriate, sharing of individual administering the WIA who Paragraph (b)(1)(vi) would require the information. Proposed paragraph (b) is not a public official if the individual recipient to dispose of information would not restrict the types of media is an agent or contractor of a public disclosed or obtained, and any copies that may be used to transmit official, or on the basis of informed thereof made by the recipient agency, confidential UC information as long as consent. entity, or contractor, after the purpose the safeguards are met. Paragraph (c)(2) would require that for which the information is disclosed is Paragraph (c)(1) would permit a state information redisclosed under served, except for disclosed information or state UC agency to authorize any paragraphs (c)(1)(v) and (vi) be subject possessed by any court. Disposal means recipient of confidential information to the safeguards in paragraph (b). return of the information to the under paragraph (a) (which applies to Paragraph (d) would provide that the disclosing state or state UC agency or disclosure to a public official, except as safeguards in this section, including the destruction of the information, as provided in paragraph (d) of this limitations on redisclosure, do not directed by the state or state UC agency. section, to an agent or contractor of a apply to disclosures of UC information Disposal includes deletion of personal public official, and to any other entity to a Federal agency where the identifiers by the state or state UC on the basis of informed consent) to Department has published a notice in agency in lieu of destruction. The state redisclose information only in eight the Federal Register that the Federal or state UC agency would set situations. These are redisclosure: agency has appropriate safeguards, and appropriate time limits on retention on • To the individual or employer who limitations on redisclosure, to protect a case-by-case basis in order to prohibit is the subject of the information the confidentiality of the disclosed permanent records storage. (paragraph (c)(1)(i)). information consistent with Section Paragraph (b)(1)(vii) would require • To attorney or other duly 303(a)(1), SSA. The reason for this states to maintain a tracking system authorized agent representing the exception is to avoid unnecessary sufficient to allow an audit of individual or employer (paragraph duplication of requirements, or the compliance with the requirements of (c)(1)(ii)). creation of inconsistent requirements, this subpart. States would be free to • In a civil or criminal proceedings concerning safeguards and restrictions specify the details for this disclosure for or on behalf of a recipient agency or on redisclosure, for Federal agencies tracking system. Tracking by states is entity (paragraph (c)(1)(iii)). that already follow strong safeguards for necessary to ensure that recipients of • As provided in § 603.7, in response protecting the confidentiality of disclosed information are complying to a subpoena (paragraph (c)(1)(iv)). information. This exception is limited to with the required safeguards. This • To agents and contractors of public Federal agencies because the responsibility may not be handed over officials (paragraph (c)(1)(v)). Under this Department, through its regular contacts to the recipient. Where recipients would provision, the recipient public official with such agencies, is in a position to be required to pay for the costs of would remain responsible for the uses easily determine whether the applicable
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Federal laws and regulations provide New Hires is protected by a ‘‘security Paragraph (b)(1) sets out the terms and safeguards and limitations consistent plan’’ of HHS which the Department of conditions that would be required to be with Section 303(a)(1), SSA. Two Labor has determined provides included in all agreements, and also disclosures for which the Department safeguards adequate to meet the provides that the terms and conditions has already determined that a Federal requirement of Section 303(a)(1) to of any agreement need not be limited to agency has in place adequate alternative maintain confidentiality. Further, laws those specifically required. Required to safeguards include disclosures to the governing information in the National be included would be: Internal Revenue Service (IRS) for Directory of New Hires impose strict • A description of the specific purposes of administering the Health controls on redisclosure and disposal of information to be furnished and the Coverage Tax Credit (HCTC), and that information. See, e.g., 42 U.S.C. purposes for which the information is disclosures of wage and claim 653(i), (j), (l), and (m). Accordingly, the sought; information to HHS for purposes of the requirements of § 603.9 of this rule, • A statement that those who request National Directory of New Hires. concerning safeguards, do not apply or receive information under the The HCTC, established by the Trade disclosures to the HHS for purposes of agreement will be limited to those with Act of 2002 (Pub. L. 107–210), is a the National Directory of New Hires. a need to access it for purposes listed in partial Federal tax credit toward the The Department has determined that the agreement; purchase of qualified health insurance HHS has appropriate alternative • The methods and timing of requests for eligible individuals and their safeguards, and limitations on for information, including the format to families. Eligible individuals include redisclosure, to protect the be used; workers covered by the TAA program confidentiality of the disclosed • Provision for paying the state or who are either receiving Trade information consistent with Section state UC agency for any costs of Readjustment Allowances (TRA) or who 303(a)(1), SSA. furnishing information, as required by would be eligible for TRA but for not Section 603.10, Agreements § 603.8 (on costs); having exhausted UC and eligible • Provision for safeguarding the participants in the ATAA program. The This section sets out the proposed information disclosed, as required by IRS, which administers the HCTC, requirements concerning data-sharing § 603.9 (on safeguards); and needs information from state workforce agreements with parties obtaining • Provision for on-site inspections of agencies (SWAs) about who is eligible confidential UC information. The the agency, entity, or contractor to for TRA, or would be but for not having required terms and conditions are assure that the requirements of the exhausted UC, as well as information similar to those contained in the state’s law and the agreement or about who is participating in the ATAA existing part 603 but have been contract are being met. program, to determine eligibility for the simplified to provide state flexibility. Paragraph (b)(2) would require that, tax credit. UC information needed by Paragraph (a)(1) would require a state for disclosures under § 603.5(d)(2) (to a the IRS would fall within the protection or state UC agency to enter into a third party on the basis of informed of this rule, and TAA and ATAA written, enforceable agreement with any information would be subject under consent), the agreement required by agency or entity requesting disclosure of state law to the same confidentiality paragraph (a) of this section must assure UC information under proposed protections as contained in this rule. that the information will be accessed by However, Section 6103 of the Internal § 603.5(d)(2) (disclosure to a third party only those entities with authorization Revenue Code and IRS regulations on on the basis of informed consent); (e) under the individual’s or employer’s the confidentiality of tax return (disclosure of information to a public release, and that it may be used only for information (26 CFR 301.6103(a)–1 et official), except as provided in the specific purposes authorized in that seq.) are sufficient to protect the paragraph (d) of this section; (f) release. This safeguard is included in confidentiality of this information (disclosure to an agent or contractor of UIPL 23–96 (Disclosure of Confidential consistent with Section 303(a)(1), SSA. a public official); § 603.6(b)(1) through Employment Information to Private (Once this information about ATAA, (4); (6); and (7)(i) (where disclosure is Entities), which will be superseded by TRA, and UC eligibility is submitted to required by Federal UC law, except to a final rule. the IRS or its agents, it becomes HHS under Sections 303(h), SSA, and A single, comprehensive agreement protected tax return information.) 3304(a)(16)(B), FUTA); and § 603.22 (to would satisfy the requirement for an Requiring the IRS to follow the a requesting agency for purposes of an agreement in cases where repeated requirements of this regulation in IEVS). disclosures to the same entity occur. addition to Section 6103 and IRS Paragraph (a)(2) requires, for Paragraph (c) discusses enforcement regulatory requirements would be disclosure to an agent or contractor of a and breach of agreements. unnecessarily burdensome and may public official, that the state or state UC Paragraph (c)(1) would prescribe the create conflicting obligations for that agency enter into a written, enforceable steps to be taken in case of any breach agency. Accordingly, the requirements agreement (whether on paper or of an agreement, including failure to of § 603.9 of this rule, concerning electronic) with the public official on timely pay for the costs of any safeguards, do not apply to disclosures whose behalf of the agent or contractor disclosure. First, the agreement would to the IRS for purposes of administering will obtain information, which requires have to be suspended, and any further the HCTC. The Department has the public official to ensure that the disclosure would have to be prohibited, determined that the IRS has appropriate agent or contractor complies with the until the state or state UC agency is alternative safeguards, and limitations safeguards of § 603.9. The purpose of satisfied that corrective action has been on redisclosure, to protect the this provision would be to have the taken and that no further breach of the confidentiality of the disclosed public official with responsibility for agreement will occur. Second, in the information consistent with Section the public purpose that is being carried absence of prompt and satisfactory 303(a)(1), SSA. out by the use of the disclosed corrective action, the agreement would Similarly, wage and claim information, assume responsibility for have to be cancelled, and the party information disclosed to HHS for safeguarding the confidentiality of the would have to surrender all information purposes of the National Directory of data. obtained under the agreement and any
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other information relevant to the memorialize them by agreement. UC law, and that those provisions are agreement. Further, most disclosures to Federal interpreted consistently with Federal It is necessary to the integrity of the agencies are documented in the sense UC law. Substantial compliance means confidentiality requirement that any that they are either explicitly or that a state’s administration of its law is breach of an agreement, whatever its implicitly required by statute or are the substantially consistent with Federal UC importance may seem in the abstract, be subject of a memorandum of law. promptly addressed and corrected, and, understanding between the Department This section sets forth how the in the absence of prompt and of Labor and the recipient Federal Department of Labor would determine satisfactory correction, that the agency. Finally, for Federal agencies and enforce conformity and substantial agreement be cancelled and the state or that already have a method in place that compliance with the confidentiality and state UC agency retrieve and secure all is determined adequate by the disclosure requirements of Title III of disclosed information. Department of Labor to reimburse state the SSA and Section 3304(a)(16), FUTA, Paragraph (c)(2) would require that UC agencies for the costs associated as provided in subparts B and C of this the state and state UC agency utilize all with disclosure, there is no need to regulation. The procedures in 20 CFR available legal enforcement tools. Thus, negotiate cost reimbursement by 601.5 would apply, meaning that if any in addition to the actions required to be agreement. issue involving conformity and taken in accordance with paragraph Two agencies that the Department has substantial compliance arose, the (c)(1), the state or state UC agency determined to already have in place Department would generally first hold would be required to undertake any appropriate alternative safeguards (as informal discussions with state officials. other action under the agreement, or indicated in the discussion of § 603.9, Should informal discussions fail to under any law of the state or of the safeguards) and to have appropriate resolve the issue, the Department would United States, to enforce the agreement methods in place to reimburse state UC offer the state UC agency an opportunity and secure satisfactory corrective action agencies for costs associated with for a hearing. If the Secretary of Labor or surrender of information. Other disclosure are the IRS, for purposes of were to find, after reasonable notice and remedial actions the state would be administering the HCTC, and HHS, for opportunity for a hearing, a failure to required to undertake include seeking purposes of the National Directory of conform or substantially comply with damages, penalties, and restitution for New Hires. Thus, the requirements of the confidentiality and disclosure any charges to granted funds, and this section, concerning agreements and requirements of Title III, SSA, as recompense for all costs incurred by the their enforcement, do not apply to the provided in subparts B and C, the state or state UC agency in pursuing IRS, for purposes of administering the Secretary would notify the Governor of legal action for the breach of the HCTC, or to HHS, for purposes of the the state that grants to fund state agreement and enforcement as required National Directory of New Hires. by paragraph (c). administration of the UC program Paragraph (d) would except from the Section 603.11, Notification of would be withheld. For failure to requirements of this section, concerning Claimants and Employers conform or substantially comply with agreements and their enforcement, This section would require state UC the disclosure requirements of Section disclosures of UC information to a agencies to notify claimants and 3304(a)(16), FUTA, as provided in Federal agency that the Department has employers how confidential UC subpart B, the Secretary would make no determined to have in place adequate information about them may be certification under FUTA to the safeguards to satisfy Section 303(a)(1), requested and utilized. This section is Secretary of the Treasury that employers SSA’s requirement of maintaining derived from present § 603.4 but, unlike in the state are eligible to receive credit confidentiality, and to have an the present § 603.4, would be applicable against the Federal unemployment tax. appropriate method of paying or to employers as well as claimants. State All the confidentiality and disclosure reimbursing the state UC agency (which privacy law may require more detailed requirements set forth in this proposed may involve a reciprocal cost notification. regulation are intended to be both arrangement) for costs involved in such Section 603.4 of the present part 603 conformity and substantial compliance disclosures. For the reasons described in implements the notification requirement requirements, even though some of the the discussion of § 603.9(d) (concerning applicable to the IEVS of Section disclosure provisions in Title III, SSA, safeguards), the Department has 1137(a)(6) of the SSA. This section mention only substantial compliance determined or will determine that in restates the notification requirement of and do not explicitly require that they certain cases Federal agencies already Section 1137(a)(6), SSA, as a general be provided for in state law (the have in place safeguards adequate to requirement of Section 303(a)(1) of the definition of a conformity requirement). satisfy confidentiality concerns. SSA. Notifying claimants and employers However, since only state law can The Department believes that for what use may be made of UC compel the state UC agency to hold these disclosures, when the relevant information is necessary to maintaining information confidential or to disclose Federal agency also has in place a their confidence in the federal-state UC information, a conformity mandate is method determined adequate by the system, which is critical to its proper inherent in these provisions. Department of Labor to reimburse state and efficient administration. Additionally, since these provisions are UC agencies for the costs associated exceptions to Section 303(a)(1), SSA’s with disclosure, the state UC agencies Section 603.12, Enforcement confidentiality requirement, which is should be excepted from the For a state to receive Federal grants to itself a conformity requirement, requirement to enter into written fund UC administration, and for conformity is implied, since an agreements. The reasons are several. employers in the state to receive credit exception to state law is needed to First, the safeguards that govern against the Federal unemployment tax, permit or compel disclosure. We note information disclosed to Federal state law must conform and its practices that, as a practical matter, the effect of agencies are already codified in statute, must substantially comply with the a state’s nonconformity or lack of regulation, or the Federal agency’s requirements of Federal UC law. substantial compliance under Title III, written operating policies and Conformity means that a state’s law SSA, is the same: loss to the state of procedures, so there is no need to contains provisions required by Federal Federal UC administrative grants.
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Two provisions of Section 303, SSA, requires state UC agencies to obtain Executive Order 12866 mention neither conformity nor information from other agencies. In substantial compliance (Sections 303(c) order to clarify what information state This proposed rule is a ‘‘significant and 303(f)). Section 303(c) (requiring, UC agencies must obtain from other regulatory action’’ within the meaning among other things, disclosures to the agencies and in what circumstances, of Executive Order 12866 because it Railroad Retirement Board) uses this proposed rule addresses Section meets the criteria of Section 3(f)(4) of terminology of strict compliance, 303(f), the IEVS requirements, in a that Order in that it raises novel or legal though we interpret it to require separate subpart. Enforcement of policy issues arising out of legal substantial compliance to be in keeping subpart C, however, would occur under mandates, the President’s priorities, or with our interpretation of the rest of the § 603.12 of subpart B. the principles set forth in the Executive requirements in Title III, SSA. Section Order. Accordingly, the proposed rule 303(f) (requiring disclosures for IEVS Section 603.20, Purpose and Scope has been submitted to, and reviewed by, purposes) is completely silent on This section sets forth the purpose the Office of Management and Budget enforcement. However, that section and scope of proposed subpart C. It also (OMB). would be a meaningless requirement if notes the statutory requirements (under However, the proposed rule is not enforcement authority did not exist. Section 1137, SSA) that states have ‘‘economically significant’’ because it Further, the structure of Title III, SSA, wage record systems and that claimants would not have an annual effect on the which gives the Secretary of Labor furnish statements regarding their Social economy of $100 million or more. We authority to distribute grant funds to Security account numbers (as discussed have also determined that the proposed states who meet the requirements of above), and, under the 1988 rule would have no adverse material Title III, SSA, indicates that the amendments to Section 1137, SSA, impact upon the economy and that it Secretary of Labor has authority to nationality or immigration status. would not materially alter the budgeting implement and enforce its provisions. This subpart applies only to state UC impact of entitlement, grants, user fees Conformity and substantial agencies, as they, not states, are required or loan programs, or the rights and compliance with proposed part 603 may to disclose information referred to in obligations of recipients thereof. require amendments to state law subpart C. Further, we have evaluated the (including regulations) or to state UC proposed rule and found it consistent agency policy or practice. Each state Section 603.21, Definition with the regulatory philosophy and would need to review its law and data- This section defines ‘‘requesting principles set forth in Executive Order sharing agreements to ensure that they agency,’’ in accordance with Section 12866, which governs agency conform and substantially comply with 1137 SSA, to mean an agency that rulemaking. Although the proposed rule the confidentiality and disclosure administers Temporary Assistance to would impact states and state UC requirements of Title III, SSA, and agencies, it would not adversely affect Section 3304(a)(16), FUTA, as provided Needy Families, Medicaid, Food them in a material way. The proposed in this proposed rule. Stamps, or other SSA programs under Titles I, II, X, XIV, or XVI, SSA. rule would protect state UC agencies Subpart C—Income and Eligibility from becoming clearinghouses of Verification System (IEVS) Section 603.22, Disclosure of confidential UC information and Information Subpart C would implement Section preserve UC grant funds for program 303(f) of the SSA. That section requires This section sets forth the basic purposes. In addition, the proposed rule states to have an IEVS which meets the requirement of the subpart that each would maintain state flexibility in requirements of Section 1137 of the state UC agency must disclose wage and deciding whether to permit certain SSA, under which information is claim information to requesting agencies disclosures of confidential UC requested and exchanged for the and that the state UC agency must information for purposes other than the purpose of verifying eligibility for, and adhere to standardized formats administration of the UC program so the amount of, benefits available under established by the Secretary of HHS and long as certain safeguards are followed. several federally assisted programs defined in 42 CFR 435.960. This section Executive Order 13132 including the federal-state UC program. would require state UC agencies to Because the purpose of these regulations disclose only wage and claim We have reviewed this proposed rule is limited to addressing confidentiality information contained in the agency’s in accordance with Executive Order and disclosure of UC information by UC records. 13132 and have determined that it may have federalism implications. We intend state government agencies, subpart C Section 603.23, Crossmatch of Wage and to consult with organizations includes only those portions of the Benefit Information present part 603 IEVS regulations which representing state elected officials about address that subject. Consequently, This section would require that states this rule in the upcoming weeks. We subpart C merely notes, but does not UC agencies obtain information from the held a previous federalism consultation implement, the requirement of Section Social Security Administration and any with organizations representing state 1137 SSA, and the present part 603 requesting agency that is needed in elected officials at the Department of concerning claimant provision of Social verifying eligibility for, and the amount Labor on October 19, 2000, during an Security account numbers and other of, compensation payable under the earlier stage in this rulemaking process. requirements of Section 1137, SSA. state UC law. It would also require state These organizations expressed no Nevertheless, those requirements are UC agencies to crossmatch quarterly concerns at that time, or in the statutory and states must still comply wage information with UC payment following months. However, we invite with them. information to the extent such these organizations and states to submit Section 303(f), SSA, is a mandatory information is likely, as determined by comments on this proposed rule. disclosure requirement like the the Secretary of Labor, to be productive Twenty-five states submitted comments requirements addressed in § 603.6 of in identifying ineligibility for benefits on the 1992 proposed regulation. We subpart B. In addition to requiring and preventing or discovering incorrect believe this proposed rule addresses the disclosure, however, Section 303(f) payments. concerns expressed in those comments.
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Executive Order 12988 Accordingly, no regulatory flexibility 603.7 What requirements apply to analysis is required. subpoenas, other compulsory process, We drafted and reviewed this and disclosure to officials with subpoena proposed regulation in accordance with Congressional Review Act authority? Executive Order 12988, Civil Justice This proposed rule is not a ‘‘major 603.8 What are the requirements for Reform, and it would not unduly rule’’ as defined by Section 804 of the payment of costs and program income? burden the Federal court system. The 603.9 What safeguards and security Small Business Regulatory Enforcement proposed rule was written to minimize requirements apply to disclosed Fairness Act of 1996. This proposed rule litigation and provide a clear legal information? would not result in an annual effect on standard for affected conduct, and was 603.10 What are the requirements for the economy of $100 million or more; a reviewed carefully to eliminate drafting agreements? major increase in costs or prices; or 603.11 How do states notify claimants and errors and ambiguities. significant adverse effects on employers about the uses of their Unfunded Mandates Reform Act of competition, employment, investment, information? 1995 and Executive Order 12875 productivity, innovation, or the ability 603.12 How are the requirements of this subpart enforced? This proposed rule was reviewed in of United States-based companies to accordance with the Unfunded compete with foreign-based companies Subpart C—Mandatory Disclosure for in domestic and export markets. Income and Eligibility Verification System Mandates Reform Act of 1995 (UMRA) (IEVS) (2 U.S.C. 1501 et seq.) and Executive Effect on Family Life Order 12875. We have determined that 603.20 What is the purpose and scope of We certify that this proposed rule was this proposed rule does not include any this subpart? assessed in accordance with Public Law 603.21 What definitions apply to this Federal mandate that may result in 105–277, 112 Stat. 2681, and that the subpart? increased expenditures by state, local, proposed rule would not adversely 603.22 What information must state UC or tribal governments, in the aggregate, affect the well-being of the nation’s agencies disclose for purposes of an or by the private sector, of $100 million families. IEVS? or more in any one year. Accordingly, 603.23 What information must state UC we have not prepared a budgetary List of Subjects in 20 CFR Part 603 agencies obtain from other agencies, and impact statement. crossmatch with wage information, for Employment and Training purposes of an IEVS? Paperwork Reduction Act Administration, Labor, Unemployment Compensation. Authority: 42 U.S.C. 1302(a); Secretary’s The following sections of this Order No. 4–75 (40 FR 18515) and Secretary’s proposed rule contain information Catalogue of Federal Domestic Order No. 14–75 (November 12, 1975). collection requirements or would revise Assistance Number Subpart A—In General information collection requirements in This program is listed in the current 20 CFR part 603: §§ 603.5, 603.6, Catalogue of Federal Domestic § 603.1 What is the purpose and scope of 603.7, 603.8, 603.9, 603.10, 603.11, Assistance at No. 17.225, this part? 603.22, and 603.23. As required by the Unemployment Insurance. The purpose of this part is to Paperwork Reduction Act of 1995 (44 implement the requirements of Federal U.S.C. 3507(d)), we have submitted the Signed in Washington, DC on August 5, 2004. UC law concerning confidentiality and information collection requirements in disclosure of UC information. This part this proposed rule to the OMB for Emily Stover DeRocco, applies to states and state UC agencies, approval under OMB control number Assistant Secretary of Labor, Employment as defined in § 603.2(f) and (g). 1205–0238. and Training Administration. The annual burden associated with Words of Issuance § 603.2 What definitions apply to this part? this proposed rule for all states For the reasons set forth in the For the purposes of this part: combined is estimated at approximately preamble, part 603 of Title 20, Code of (a)(1) Claim information means 25,810 hours. information about: We invite public comment on all of Federal Regulations is proposed to be revised as set forth below: (i) Whether an individual is receiving, the information collection requirements has received, or has applied for UC; in this proposed rule. These comments PART 603—FEDERAL-STATE (ii) The amount of compensation the should be submitted to: Office of UNEMPLOYMENT COMPENSATION individual is receiving or is entitled to Information and Regulatory Affairs, (UC) PROGRAM; CONFIDENTIALITY receive; and Office of Management and Budget, AND DISCLOSURE OF STATE UC (iii) The individual’s current (or most Attention: Desk Officer for the INFORMATION recent) home address. Department of Labor, Employment and (2) For purposes of subpart C (IEVS), Training Administration, 725 17th Sec. claim information also includes: Street, NW., Room 10235, Washington, Subpart A—In General (i) Whether the individual has refused an offer of work and, if so, a description DC 20503. 603.1 What is the purpose and scope of this of the job offered including the terms, Regulatory Flexibility Act part? 603.2 What definitions apply to this part? conditions, and rate of pay; and This proposed rule would not have a (ii) Any other information contained ‘‘significant economic impact on a Subpart B—Confidentiality and Disclosure in the records of the state UC agency substantial number of small entities.’’ Requirements that is needed by the requesting agency The proposed rule affects states and 603.3 What is the purpose and scope of this to verify eligibility for, and the amount state agencies, which are not within the subpart? of, benefits. definition of ‘‘small entity’’ under 5 603.4 What is the confidentiality (b) Confidential UC information and requirement of Federal UC law? U.S.C. 601(6). Under 5 U.S.C. 605(b), the 603.5 What are the exceptions to the confidential information mean any UC Secretary has certified to the Chief confidentiality requirement? information, as defined in paragraph (j) Counsel for Advocacy of the Small 603.6 What disclosures are required by of this section, required to be kept Business Administration to this effect. Federal UC law? confidential under § 603.4.
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(c) Public domain information agency for use in the UC program. It also disclosure of any such information, means— does not include the personnel or fiscal except as provided in this part. (1) Information about the organization information of a state UC agency. (c) Application. Each state law must of the state and the state UC agency and (k) Wage information means contain provisions that are interpreted appellate authorities, including the information in the records of a state UC and applied consistently with the names and positions of officials and agency (and, for purposes of § 603.23 interpretation at paragraph (b) of this employees thereof; (IEVS)), information reported under section and with this subpart, and must (2) Information about the state UC law provisions of state law which fulfill the provide penalties for any disclosure of (and applicable Federal law) provisions, requirements of Section 1137 of the confidential UC information that is rules, regulations, and interpretations SSA) about the— inconsistent with any provision of this thereof, including statements of general (1) Wages paid to an individual, subpart. policy and interpretations of general (2) Social security account number (or applicability, appeals records and numbers, if more than one) of such § 603.5 What are the exceptions to the decisions, and precedential individual, and confidentiality requirement? determinations on coverage of (3) Name, address, state, and the The following are exceptions to the employers, employment, and wages; Federal employer identification number confidentiality requirement. Disclosure and of the employer who paid such wages to is permissible under exceptions at (3) Any agreement of whatever kind such individual. paragraphs (a) through (g) of this section only if authorized by state law and if or nature, including interstate Subpart B—Confidentiality and such disclosure does not interfere with arrangements and reciprocal agreements Disclosure Requirements and any agreement with the Department the efficient administration of the state of Labor or the Secretary, relating to the § 603.3 What is the purpose and scope of UC law. Disclosure is permissible under administration of the state UC law. this subpart? exceptions at paragraphs (h) and (i) of (d) Public official means an official, This subpart implements the basic this section without such restrictions. agency, or public entity within the confidentiality requirement derived (a) Public domain information. The executive branch of Federal, state, or from Section 303(a)(1), SSA, and the confidentiality requirement of § 603.4 local government who (or which) has disclosure requirements of Sections does not apply to public domain responsibility for administering or 303(a)(7), (c)(1), (d), (e), (h), and (i), information, as defined at § 603.2(c). enforcing a law, or a legislator in the Social Security Act (SSA), and Section (b) Administration of the UC program. Federal, state, or local government with 3304(a)(16), Federal Unemployment Tax The confidentiality requirement of oversight responsibility for the UC Act (FUTA). This subpart also § 603.4 does not apply when disclosure program. establishes uniform minimum is necessary for the proper (e) Secretary and Secretary of Labor requirements for the payment of costs, administration of the UC program. mean the cabinet officer heading the safeguards, and data-sharing agreements (c) Individual or employer. Disclosure United States Department of Labor, or when UC information is disclosed, and of UC information about an individual his or her designee. for conformity and substantial to that individual, or of UC information (f) State means a state of the United compliance with this proposed rule. about an employer disclosed to that States of America, the District of This subpart applies to states and state employer is permissible. Columbia, the Commonwealth of Puerto UC agencies, as defined in § 603.2(f) and (d) Informed consent. Disclosure of Rico, and the United States Virgin (g). UC information on the basis of informed Islands. consent is permissible in the following (g) State UC agency means an agency § 603.4 What is the confidentiality circumstances— charged with the administration of the requirement of Federal UC law? (1) Agent or attorney—to an agent or state UC law. (a) Statute. Section 303(a)(1) of the attorney of an individual, of information (h) State UC law means the law of a SSA (42 U.S.C. 503(a)(1)) provides that, that pertains to that individual, or to an state approved under Section 3304(a) of for the purposes of certification of agent or attorney of an employer, of the Internal Revenue Code of 1986 (26 payment of granted funds to a state information that pertains to that U.S.C. 3304(a)). under Section 302(a) (42 U.S.C. 502(a)), employer, if — (i) Unemployment compensation (UC) state law must include provision for (i) The agent or attorney presents a means cash benefits to individuals with ‘‘(s)uch methods of administration written release from the individual or respect to their unemployment. * * * as are found by the Secretary of employer being represented, or (j) UC information and state UC Labor to be reasonably calculated to (ii) If a written release is impossible information means information in the insure full payment of unemployment or impracticable to obtain, the agent or records of a state or state UC agency that compensation when due * * *’’. attorney presents such other form of pertains to the administration of the (b) Interpretation. The Department of consent as is permitted by the state UC state UC law. This term includes those Labor interprets Section 303(a)(1), SSA, agency in accordance with state law; state wage reports collected under the to mean that ‘‘methods of (2) Third party—to a third party only Income and Eligibility Verification administration’’ that are reasonably if that entity obtains a written release System (IEVS) (Section 1137 of the calculated to insure the full payment of from the individual or employer to Social Security Act (SSA)) that are UC when due must include provision whom the information pertains. obtained by the state UC agency for for maintaining the confidentiality of (i) The release must be signed and determining UC monetary eligibility or any UC information which reveals the must include a statement— are downloaded to the state UC agency’s name or any identifying particular about (A) Specifically identifying the files as a result of a crossmatch but does any individual or any past or present information that is to be disclosed; not otherwise include those wage employer or employing unit, or which (B) That state government files will be reports. It does not include information could foreseeably be combined with accessed to obtain that information; in a state’s Directory of New Hires, but other publicly available information to (C) Of the specific purpose or does include any such information that reveal any such particulars, and must purposes for which the information is has been disclosed to the state UC include provision for barring the sought and a statement that information
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obtained under the release will only be in response to a court order or to an (iv) Whether an individual has used for that purpose or purposes; and official with subpoena authority is refused an offer of employment and, if (D) Indicating all the parties who may permissible as specified in § 603.7(b). so, a description of the employment so receive the information released. (i) As required by Federal law. offered and the terms, conditions, and (ii) The purpose specified in the Disclosure as required by Federal law is rate of pay therefore. release must be limited to— permissible. (4) Section 303(e)(1), SSA, requires (A) Providing a service or benefit to each state UC agency to disclose, upon the individual signing the release that § 603.6 What disclosures are required by request, directly to officers or employees such individual expects to receive as a Federal UC law? of any state or local child support result of signing the release; or (a) The Department of Labor interprets enforcement agency, any wage (B) Carrying out administration or Section 303(a)(1) of the SSA as requiring information contained in the records of evaluation of a public program to which disclosure of all information necessary the state UC agency for purposes of the release pertains. for the proper administration of the UC establishing and collecting child program. (Note to paragraph (d)(2): The Electronic support obligations (not to include Signatures in Global and National Commerce (b) In addition to Section 303(f), SSA custodial parent support obligations) Act of 2000 (E-Sign), Public Law 106–229, (concerning an IEVS), which is from, and locating, individuals owing may apply where a party wishes to effectuate addressed in subpart C, the following such obligations. electronically an informed consent release provisions of Federal UC law also (5) Section 303(h), SSA, requires each (paragraph(d)(2) of this section) or a specifically require disclosure of state state UC agency to disclose quarterly, to disclosure agreement (§ 603.10(a)) with an UC information and state-held the Secretary of Health and Human entity that uses informed consent releases. E- information pertaining to the Federal Services (HHS), wage information and Sign, among other things, sets forth the UC and benefit programs of UCFE, UCX, claim information as required under circumstances under which electronic TAA (except for confidential business Section 453(i)(1) of the SSA signatures, contracts, and other records relating to such transactions (in lieu of paper information collected by states), DUA, (establishing the National Directory of documents) are legally binding. Thus, an and any Federal UC benefit extension New Hires), contained in the records of electronic communication may suffice under program: such agency, for purposes of E-Sign to establish a legally binding contract. (1) Section 303(a)(7), SSA, requires Subsections (i)(1), (i)(3), and (j) of The states will need to consider E-Sign’s state law to provide for making Section 453, SSA (establishing the application to these informed consent available, upon request, to any agency of National Directory of New Hires and its releases and disclosure agreements. In the United States charged with the uses for purposes of child support particular, a state must, to conform and administration of public works or enforcement, Temporary Assistance to substantially comply with this part, assure assistance through public employment, Needy Families (TANF), TANF that these informed consent releases and disclosure of the following information disclosure agreements are legally enforceable. research, administration of the earned If an informed consent release or disclosure with respect to each recipient of UC— income tax credit, and use by the Social agreement is to be effectuated electronically, (i) Name; Security Administration). the state must determine whether E-Sign (ii) Address; (6) Section 303(i), SSA, requires each applies to that transaction, and, if so, make (iii) Ordinary occupation; state UC agency to disclose, upon certain that the transaction satisfies the (iv) Employment status; and request, to officers or employees of the conditions imposed by E-Sign. The state (v) A statement of such recipient’s Department of Housing and Urban must also make certain that the electronic rights to further compensation under the Development (HUD) and to transaction complies with every other state law. representatives of a public housing condition necessary to make it legally (2) Section 303(c)(1), SSA, requires agency, for purposes of determining an enforceable.) each state to make its UC records individual’s eligibility for benefits, or (e) Public official. Disclosure of UC available to the Railroad Retirement the amount of benefits, under a housing information to a public official for use Board, and to furnish such copies of its assistance program of HUD, any of the in the performance of his or her official UC records to the Railroad Retirement following information contained in the duties is permissible. ‘‘Performance of Board as the Board deems necessary for records of such state agency about any official duties’’ means administration or its purposes. individual applying for or participating enforcement of law, or, in the case of a (3) Section 303(d)(1), SSA, requires in any housing assistance program state or Federal legislative branch, each state UC agency, for purposes of administered by HUD who has signed a oversight of UC law. determining an individual’s eligibility consent form approved by the Secretary (f) Agent or contractor of public benefits, or the amount of benefits, of HUD— official. Disclosure of UC information to under a food stamp program established (i) Wage information, and an agent or contractor of a public official under the Food Stamp Act of 1977, to (ii) Whether the individual is to whom disclosure is permissible disclose, upon request, to officers and receiving, has received, or has made under paragraph (e) of this section. employees of the Department of application for, UC, and the amount of (g) Bureau of Labor Statistics. The Agriculture, and to officers or any such compensation being received confidentiality requirement does not employees of any state food stamp (or to be received) by such individual. apply to information collected agency, any of the following information (7) Section 3304(a)(16), Federal exclusively for statistical purposes contained in the records of the state UC Unemployment Tax Act (FUTA) under a cooperative agreement with the agency— requires each state UC agency— Bureau of Labor Statistics (BLS). (i) Wage information, (i) To disclose, upon request, to any Further, this part does not restrict or (ii) Whether an individual is state or political subdivision thereof impose any condition on the transfer of receiving, has received, or has made administering a TANF program funded any other information to the BLS under application for, UC, and the amount of under part A of Title IV of the SSA, an agreement, or the BLS’s disclosure or any such compensation being received, wage information contained in the use of such information. or to be received, by such individual, records of the state UC agency which is (h) Court order; official with subpoena (iii) The current (or most recent) home necessary (as determined by the authority. Disclosure of UC information address of such individual, and Secretary of HHS in regulations), for
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purposes of determining an individual’s of making any disclosure. Grant funds provided in Sections 453(e)(2) and eligibility for TANF assistance or the may not be used to pay any of the costs 453(g) of the SSA, the Secretary of HHS amount of TANF assistance; and of making any disclosures under has the authority to determine what (ii) To furnish to the Secretary of § 603.5(e) (optional disclosure to a constitutes a reasonable amount for the HHS, in accordance with that public official), §603.5(f) (optional reimbursement for disclosures under Secretary’s regulations at 45 CFR disclosure to an agent or contractor of a Section 303(h), SSA, and Section 303.108, wage information (as defined at public official), §603.5(g) (optional 3304(a)(16)(B), FUTA. 45 CFR 303.108(a)(2)) and UC disclosure to BLS), or §603.5(h) (d) Payment of costs. The costs to a information (as defined at 45 CFR (disclosure to the IRS for HCTC state or state UC agency of making a 303.108(a)(3)) contained in the records purposes), § 603.6(b) (mandatory disclosure of information, calculated in of such agency for the purposes of the disclosures for non-UC purposes), or accordance with paragraph (c) of this National Directory of New Hires § 603.22 (mandatory disclosure for section, must be paid by and collected established under Section 453(i) of the purposes of an IEVS). from the recipient of the information SSA. (b) Use of grant funds permitted. either in advance or by way of (c) Each state law must contain Grant funds paid to a state under reimbursement. If the recipient is not a provisions that are interpreted and Section 302(a) of the SSA may be used public official, such costs, except for applied consistently with the to pay the costs of only those good reason (such as when the requirements listed in this section. disclosures necessary for proper disclosure involves minimal cost) must administration of the UC program. (This be paid and collected in advance. For § 603.7 What requirements apply to may include some disclosures under the purposes of this paragraph (d), subpoenas, other compulsory process, and § 603.5(a) (concerning public domain payment in advance means full payment disclosure to officials with subpoena information), §603.5(c) (to an individual of all costs before or at the time the authority? or employer), or §603.5(d) (on the basis disclosed information is given in hand (a) In general. Except as provided in of informed consent)). In addition, grant or sent to the recipient. The requirement paragraph (b) of this section, when a funds may be used to pay costs of payment of costs in this paragraph is subpoena or other compulsory process associated with a request for disclosure met when a state UC agency has in place is served upon a state UC agency or the of UC information if not more than an a reciprocal cost agreement or state, any official or employee thereof, incidental amount of staff time and no arrangement with the recipient. As used or any recipient of confidential UC more than nominal processing costs are in this section, ‘‘reciprocal’’ means that information, which requires the involved in making the disclosure. the relative benefits received by each are production of confidential UC Finally, grant funds may be used to pay approximately equal. Payment or information or appearance for testimony costs associated with disclosures under reimbursement of costs must include upon any matter concerning such § 603.7(b)(1) (concerning court-ordered any initial start-up costs associated with information, the state or state UC agency compliance with subpoenas) if a court making the disclosure. or recipient must file and diligently has denied recovery of costs, or to pay (e) Program income. Costs paid as pursue a motion to quash the subpoena costs associated with disclosures under required by this section, and any funds or other compulsory process. Only if § 603.7(b)(2) (to officials with subpoena generated by the disclosure of such motion is denied by the court or authority) if the state UC agency has information under this part, are program other forum may the requested attempted but not been successful in income and may be used only as confidential information be disclosed, obtaining reimbursement of costs. permitted by 29 CFR 97.25(g) (on and only upon such terms as the court (c) Calculation of costs. The costs to program income). Such income may not or forum may order, such as that the a state or state UC agency of processing be used to benefit a state’s general fund recipient protect the disclosed and handling a request for disclosure of or other program. information and pay the state’s or state information must be calculated in UC agency’s costs of disclosure. accordance with the cost principles and § 603.9 What safeguards and security (b) Exceptions. The requirement of administrative requirements of 29 CFR requirements apply to disclosed paragraph (a) of this section to move to part 97 and Office of Management and information? quash subpoenas shall not be Budget Circular No. A–87 (Revised). For (a) In general. For disclosures of applicable, so that disclosure is the purpose of calculating such costs, confidential UC information under permissible, where— any initial start-up costs incurred by the § 603.5(d)(2) (to a third party on the (1) Court Decision—a subpoena or state UC agency in preparation for basis of informed consent); §603.5(e) (to other compulsory legal process has been making the requested disclosure(s), such a public official), except as provided in served and a court has previously issued as computer reprogramming necessary paragraph (d) of this section; and a binding precedential decision that to respond to the request, and the costs §603.5(f) (to an agent or contractor of a requires disclosures of this type, or of implementing safeguards and public official); or, § 603.6(b)(1) through (2) Public Official with Subpoena agreements required by §§ 603.9 and (4), (6), and (7)(i) (as required by Federal Authority—UC information has been 603.10, must be charged to and paid by UC law, except for disclosures to HHS requested, with or without a subpoena, the recipient. (Start-up costs do not under Sections 303(h), SSA, and by a state or Federal government include the costs to the state UC agency 3304(a)(16)(B), FUTA); or § 603.22 (to a official, other than a clerk of court on of obtaining, compiling, or maintaining requesting agency for purposes of an behalf of a litigant, with authority to information for its own purposes.) IEVS), a state or state UC agency must obtain such information by subpoena Postage or other delivery costs incurred require the recipient to safeguard the under state or Federal law. in making any disclosure are part of the information disclosed against costs of making the disclosure. Penalty unauthorized access or redisclosure, as § 603.8 What are the requirements for mail, as defined in 39 U.S.C. 3201(1), provided in paragraphs (b) and (c) of payment of costs and program income? must not be used to transmit this section, and must subject the (a) In general. Except as provided in information being disclosed, except recipient to penalties provided by the paragraph (b) of this section, grant funds information disclosed for purposes of state law for unauthorized disclosure of must not be used to pay any of the costs administration of state UC law. As confidential information.
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(b) Safeguards to be required of (2) In the case of disclosures made (d) The requirements of this section recipients. (1) The state or state UC under § 603.5(d)(2) (disclosure of do not apply to disclosures of UC agency must: confidential information to a third party information to a Federal agency which (i) Require the recipient to use the on the basis of informed consent), the the Department has determined, by disclosed information only for purposes state or state UC agency must also— notice published in the Federal authorized by law and consistent with (i) Periodically audit a sample of Register, to have in place safeguards an agreement that meets the transactions accessing information adequate to satisfy the confidentiality requirements of § 603.10; disclosed under that section to assure requirement of Section 303(a)(1), SSA. (ii) Require the recipient to store the that the entity receiving disclosed information has on file a written release § 603.10 What are the requirements for disclosed information in a place agreements? physically secure from access by authorizing each access. The audit must unauthorized persons; ensure that the information is not being (a) Requirements. (1) For any disclosure of confidential information (iii) Require the recipient to store and used for any unauthorized purpose; under § 603.5(d)(2) (to a third party on process disclosed information (ii) Ensure that all employees of the basis of informed consent); maintained in electronic format, such as entities receiving access to information § 603.5(e) (to a public official), except as magnetic tapes or discs, in such a way disclosed under § 603.5(d)(2) are subject provided in paragraph (d) of this that unauthorized persons cannot obtain to the same confidentiality section; § 603.5(f) (to an agent or the information by any means; requirements, and state criminal contractor of a public official); (iv) Require the recipient to undertake penalties for violation of those § 603.6(b)(1) through (4), (6), and (7)(i) precautions to ensure that only requirements, as are employees of the (as required by Federal UC law, except authorized personnel are given access to state UC agency. to HHS under Sections 303(h), SSA, and disclosed information stored in (c) Redisclosure of confidential UC 3304(a)(16)(B), FUTA); and § 603.22 (to computer systems; information. (1) A state or state UC a requesting agency for purposes of an (v) Require each recipient agency or agency may authorize any recipient of IEVS), a state or state UC agency must entity to confidential UC information under enter into a written, enforceable (A) Instruct all personnel having paragraph (a) of this section (which agreement with any agency or entity access to the disclosed information applies to optional disclosures to public requesting disclosure(s) of such about confidentiality requirements, the officials, to agents or contractors of a information. The agreement must be requirements of this subpart B, and the public official, and to other entities on terminable if the state or state UC sanctions specified in the state law for the basis of informed consent) to agency determines that the safeguards in unauthorized disclosure of information, redisclose information only as follows: (i) To the individual or employer who the agreement are not adhered to. and (2) For disclosures referred to in (B) Sign an acknowledgment that all is the subject of the information; (ii) To an attorney or other duly § 603.5(f) (to an agent or contractor of a personnel having access to the disclosed authorized agent representing the public official), the state or state UC information have been instructed in individual or employer; agency must enter into a written, accordance with paragraph (b)(1)(v)(A) (iii) In any civil or criminal enforceable agreement with the public of this section and will adhere to the proceedings for or on behalf of a official on whose behalf the agent or state’s or state UC agency’s recipient agency or entity; contractor will obtain information. The confidentiality requirements and (iv) In response to a subpoena only as agreement must hold the public official procedures which are consistent with provided in § 603.7; responsible for ensuring that the agent this subpart B and the agreement (v) To an agent or contractor of a or contractor complies with the required by § 603.10, and agreeing to public official only if the person safeguards of § 603.9. The agreement report any infraction of these rules to redisclosing is a public official, if the must be terminable if the state or state the state UC agency fully and promptly, redisclosure is authorized by the state UC agency determines that the (vi) Require the recipient to dispose of law, and if the public official retains safeguards in the agreement are not information disclosed or obtained, and responsibility for the uses of the adhered to. any copies thereof made by the recipient confidential UC information by the (b) Contents of agreement—(1) In agency, entity, or contractor, after the agent or contractor; general. Any agreement required by purpose for which the information is (vi) From one public official to paragraph (a) of this section must disclosed is served, except for disclosed another if the redisclosure is authorized include, but need not be limited to, the information possessed by any court. by the state law; following terms and conditions: Disposal means return of the (vii) When so authorized by Section (i) A description of the specific information to the disclosing state or 303(e)(5) of the SSA (redisclosure of information to be furnished and the state UC agency or destruction of the wage information by a state or local purposes for which the information is information, as directed by the state or child support enforcement agency to an sought; state UC agency. Disposal includes agent under contract with such agency (ii) A statement that those who deletion of personal identifiers by the for purposes of carrying out child request or receive information under the state or state UC agency in lieu of support enforcement) and by state law; agreement will be limited to those with destruction. In any case, the information or a need to access it for purposes listed in disclosed must not be retained with (viii) When specifically authorized by the agreement; personal identifiers for longer than such a written release that meets the (iii) The methods and timing of period of time as the state or state UC requirements of § 603.5(d) (permitting requests for information and responses agency deems appropriate on a case-by- optional disclosure to other entities on to those requests, including the format case basis; and the basis of informed consent). to be used; (vii) Maintain a tracking system (2) Information redisclosed under (iv) Provision for paying the state or sufficient to allow an audit of paragraphs (c)(1)(v) and (vi) of this state UC agency for any costs of compliance with the requirements of section must be subject to the safeguards furnishing information, as required by this part. in paragraph (b) of this section. § 603.8 (on costs);
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(v) Provision for safeguarding the information to a Federal agency which Secretary of Labor shall make no information disclosed, as required by the Department has determined, by certification under that section to the § 603.9 (on safeguards); and notice published in the Federal Secretary of the Treasury for such state (vi) Provision for on-site inspections Register, to have in place safeguards as of October 31 of the 12-month period of the agency, entity, or contractor, to adequate to satisfy the confidentiality for which such finding is made. assure that the requirements of the requirement of Section 303(a)(1), SSA, state’s law and the agreement or and an appropriate method of paying or Subpart C—Mandatory Disclosure for contract required by this section are reimbursing the state UC agency (which Income and Eligibility Verification being met. may involve a reciprocal cost System (IEVS) (2) In the case of disclosures under arrangement) for costs involved in such § 603.5(d)(2) (to a third party on the § 603.20 What is the purpose and scope of disclosures. These determinations will this subpart? basis of informed consent), the be published in the Federal Register. agreement required by paragraph (a) of (a) Purpose. Subpart C implements this section must assure that the § 603.11 How do states notify claimants Section 303(f) of the SSA. Section 303(f) information will be accessed by only and employers about the uses of their requires states to have in effect an information? those entities with authorization under income and eligibility verification the individual’s or employer’s release, (a) Claimants. Every claimant for system, which meets the requirements and that it may be used only for the compensation must be notified, at the of Section 1137 of the SSA, under specific purposes authorized in that time of application, and periodically which information is requested and release. thereafter, in what situations exchanged for the purpose of verifying (c) Breach of agreement—(1) In confidential UC information pertaining eligibility for, and the amount of, general. If an agency, entity, or to the claimant may be requested and benefits available under several contractor, or any official, employee, or utilized. Notice on or attached to federally assisted programs, including agent thereof, fails to comply with any subsequent additional claims will the federal-state UC program. provision of an agreement required by satisfy the requirement for periodic (b) Scope. This subpart C applies only this section, including timely payment notice thereafter. to a state UC agency. (b) Employers. Every employer subject of the state’s or state UC agency’s costs (Note to §603.20: Although not billed to the agency, entity, or to a state’s law must be notified in what implemented in this part, Section 1137(a)(1) contractor, the agreement must be situations wage information and other of the SSA provides that each state must suspended, and further disclosure of confidential information about the require claimants for compensation to information (including any disclosure employer may be requested and furnish to the state UC agency their Social being processed) to such agency, entity, utilized. Security account numbers, as a condition of or contractor is prohibited, until the eligibility for compensation, and further § 603.12 How are the requirements of this requires states to utilize such account state or state UC agency is satisfied that subpart enforced? numbers in the administration of the state UC corrective action has been taken and (a) Resolving conformity and laws. Section 1137(a)(3) of the SSA further there will be no further breach. In the compliance issues. For the purposes of provides that employers must make quarterly absence of prompt and satisfactory resolving issues of conformity and wage reports to a state UC agency, or an corrective action, the agreement must be substantial compliance with the alternative agency, for use in verifying canceled, and the agency, entity, or requirements set forth in subparts B and eligibility for, and the amount of, benefits. contractor must be required to surrender C, the provisions of paragraphs (b) Section 1137(d)(1) of the SSA provides that to the state or state UC agency all each state must require claimants for (informal discussions with the compensation, as a condition of eligibility, to confidential information (and copies Department of Labor to resolve thereof) obtained under the agreement declare in writing, under penalty of perjury, conformity and substantial compliance whether the individual is a citizen or which has not previously been returned issues), and (d) (Secretary of Labor’s national of the United States, and, if not, that to the state or state UC agency, and any hearing and decision on conformity and the individual is in a satisfactory other information relevant to the substantial compliance) of 20 CFR 601.5 immigration status. Other provisions of agreement. apply. Section 1137(d) of the SSA not implemented (2) Enforcement. In addition to the (b) Conformity and substantial in this part require the states to obtain, and actions required to be taken by compliance. Whenever the Secretary of individuals to furnish, information which paragraph (c)(1) of this section, the state Labor, after reasonable notice and shows immigration status, and require the or state UC agency must undertake any opportunity for a hearing to the state UC states to verify immigration status with the Bureau of Citizenship and Immigration other action under the agreement, or agency of a state, finds that the state law under any law of the state or of the Services (formerly the Immigration and fails to conform, or that the state or state Naturalization Service). United States, to enforce the agreement UC agency fails to comply substantially, and secure satisfactory corrective action with: § 603.21 What definitions apply to this or surrender of the information, and (1) The requirements of Title III, SSA, subpart? must take other remedial actions implemented in subparts B and C, the For the purposes of this subpart C, permitted under state or Federal law to Secretary of Labor shall notify the requesting agency means: effect adherence to the requirements of Governor of the state and such state UC (a) Temporary Assistance to Needy this subpart B, including seeking agency that further payments for the Families Agency—Any state or local damages, penalties, and restitution as administration of the state UC law will agency charged with the responsibility permitted under such law for any not be made to the state until the of administering a program funded charges to granted funds and all costs Secretary of Labor is satisfied that there under part A of Title IV of the SSA. incurred by the state or the state UC is no longer any such failure. Until the (b) Medicaid Agency—Any state or agency in pursuing the breach of the Secretary of Labor is so satisfied, the local agency charged with the agreement and enforcement as required Department of Labor shall make no responsibility of administering the by this paragraph (c). further payments to such state. provisions of the Medicaid program (d) The requirements of this section (2) The FUTA requirements under a state plan approved under Title do not apply to disclosures of UC implemented in this subpart B, the XIX of the SSA.
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(c) Food Stamp Agency—Any state or Security Income for the Aged, Blind, § 603.23 What information must state UC local agency charged with the and Disabled) of the SSA. agencies obtain from other agencies, and responsibility of administering the crossmatch with wage information, for provisions of the Food Stamp Program § 603.22 What information must state UC purposes of an IEVS? under the Food Stamp Act of 1977. agencies disclose for purposes of an IEVS? (a) Crossmatch with information from (d) Other SSA Programs Agency—Any (a) Disclosure of information. Each requesting agencies. Each state UC state or local agency charged with the state UC agency must disclose, upon agency must obtain such information responsibility of administering a request, to any requesting agency, as from the Social Security Administration program under a state plan approved defined in § 603.21, that has entered and any requesting agency as may be under Title I, X, XIV, or XVI into an agreement required by § 603.10, needed in verifying eligibility for, and (Supplemental Security Income for the wage information (as defined at the amount of, compensation payable Aged, Blind, and Disabled) of the SSA. § 603.2(k)) and claim information (as under the state UC law. (e) Child Support Enforcement defined at § 603.2(a)) contained in the (b) Crossmatch of wage and benefit Agency—Any state or local child records of such state UC agency. information. The state UC agency must support enforcement agency charged crossmatch quarterly wage information with the responsibility of enforcing (b) Format. The state UC agency must adhere to standardized formats with UC payment information to the child support obligations under a plan extent that such information is likely, as approved under part D of Title IV of the established by the Secretary of HHS (in consultation with the Secretary of determined by the Secretary of Labor, to SSA. be productive in identifying ineligibility (f) HHS—The Secretary of HHS in Agriculture) and set forth in 42 CFR for benefits and preventing or establishing or verifying eligibility or 435.960 (concerning standardized discovering incorrect payments. benefit amounts under Titles II (Old- formats for furnishing and obtaining Age, Survivors, and Disability Insurance information to verify income and [FR Doc. 04–18333 Filed 8–11–04; 8:45 am] Benefits) and XVI (Supplemental eligibility). BILLING CODE 4510–30–P
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Part IV
Department of Labor The Department of Labor’s Records Management Program; Notice
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DEPARTMENT OF LABOR use and disposition of records within an materials in all media, and organization to document and transact implementation of these decisions, in Office of the Secretary its business. The program functions and compliance with National Archives and [Secretary’s Order 2–2004] responsibilities have been performed Records Administration regulations; and under the direction of the Office of the (3) Assigning a Departmental Records The Department of Labor’s Records Assistant Secretary for Administration Officer who will manage the day-to-day Management Program and Management for many years in the administration and management of all absence of a formal Secretary’s Order. matters related to the Department’s 1. Purpose Accordingly, this Order formally Records Management Program. The To delegate authority, assign delegates authority and assigns Departmental Records Officer shall be responsibility, and affirm policy for an responsibility for oversight and responsible for all matters related to the internal records management program implementation of the Records Department’s Records Management that ensures that officials and Management functions of the Program and will coordinate with the employees make, preserve and Department. National Archives and Records efficiently manage records containing Administration. adequate and proper documentation of 4. Scope b. The Solicitor of Labor is delegated the organization, functions, policies, This Order is applicable Department- authority and assigned responsibility for decisions, procedures, and essential wide. providing legal advice and counsel to transactions of the Department, in order 5. Policy the DOL agencies and offices on all to furnish the information necessary to matters arising in the administration of protect the legal and financial rights of It is the Department’s policy to make this Order. the Government and of persons directly and preserve records containing c. Agency Heads are delegated affected by the Department’s activities. adequate and proper documentation of authority and assigned responsibility The Records Management Program is the organization, functions, policies, for: intended to assure compliance with decisions, procedures, and essential (1) Developing and implementing an legal requirements to create and transactions of the Department and effective Records Management Program maintain accurate and complete records designed to furnish the information within their respective organizations of the Department’s functions and necessary to protect the legal and that is consistent with this Order and all activities and to ensure the authorized, financial rights of the Department and of applicable established requirements; timely, and appropriate disposition of persons directly affected by (2) Establishing appropriate schedules documentary materials that are no Departmental activities. The Department for disposition of official records within longer needed to conduct business. will effectively and efficiently manage their Agency; records throughout their life cycle. The (3) Assigning an Agency Records 2. Authorities and Directives Affected Department will comply with all related Officer to coordinate with appropriate a. Authorities. This Order is issued Federal statutes and regulations. All Agency officials, the management and pursuant to the Federal Records Act of scheduled records shall be destroyed, execution of the Agency’s Records 1950, as amended (44 U.S.C. 21, 29, 31, retired, or transferred, only as Management Program. The Agency 33 and 35); 29 U.S.C. 551, et seq.; 5 prescribed in approved record retention Records Officers will coordinate with U.S.C. 301; Reorganization Plan Number schedules. the Departmental Records Officer on the 6 (1950); the National Archives and Among other things, good submission of records disposition Records Administration (NARA), recordkeeping contributes to the smooth schedules related to the Agency’s Records Management Regulations, 36 operation of agency programs by making official records; CFR parts 1220, 1228, 1230, 1232 and the information needed for (4) Notifying the Departmental 1234; General Services Administration decisionmaking and operations readily Records Officer of the name, title, office (Creation, Maintenance and Use of available. It further provides location and telephone number of the Records), 41 CFR part 102–193; and the information useful to successor officials Agency Records Officer or point of Guidance Memorandum, dated March and staff for background and analysis, contact; 19, 2002, issued jointly by the National facilitating transitions between (5) Ensuring that Agency staff receive Archives and Records Administration Administrations. It ensures adequate records management training and the Department of Justice on accountability and protects records from and participate in Departmental as well ‘‘Safeguarding Information Regarding inappropriate and unauthorized access as agency training and awareness Weapons of Mass Destruction and Other and destruction. activities; Sensitive Records Related to Homeland (6) Identifying and appointing Security.’’ 6. Responsibility personnel within the Agency who will b. Directives Affected. This Order a. The Assistant Secretary for perform all applicable functions and does not affect the authorities and Administration and Management is responsibilities related to records responsibilities assigned by any other delegated authority and assigned management; and Secretary’s Order, unless otherwise responsibility for: (7) Ensuring that all employees and expressly so provided in this or another (1) Establishing, administering, and officials cooperate with the Agency Order. managing the Department’s Records Records Officer. Management Program; 3. Background (2) Periodically evaluating the 7. Reservation of Authority and The Federal Records Act of 1950 Records Management Programs relating Responsibility (section 506 (b)) requires that the Head to records creation and recordkeeping a. The submission of reports and of each Federal agency establish and requirements, maintenance and use of recommendations to the President and maintain an active Records Management records, and records disposition. These the Congress concerning the Program. Records Management is an evaluations shall include periodic administration of statutory or active continuing program for monitoring of the staff determinations of administrative provisions is reserved to controlling the creation, maintenance, the record status of documentary the Secretary.
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b. This Secretary’s Order does not amended, or under Secretary’s Order 2– Dated: August 5, 2004. affect the authorities or responsibilities 90 (January 31, 1990). Elaine L. Chao, of the Office of Inspector General under 8. Effective date Secretary of Labor. the Inspector General Act of 1978, as [FR Doc. 04–18441 Filed 8–11–04; 8:45 am] This Order is effective immediately. BILLING CODE 4510–23–P
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Part V
The President Executive Order 13351—Establishing an Emergency Board To Investigate a Dispute Between the Southeastern Pennsylvania Transportation Authority and Its Conductors Represented by the United Transportation Union
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Federal Register Presidential Documents Vol. 69, No. 155
Thursday, August 12, 2004
Title 3— Executive Order 13351 of August 9, 2004
The President Establishing an Emergency Board To Investigate a Dispute Between the Southeastern Pennsylvania Transportation Au- thority and Its Conductors Represented by the United Trans- portation Union
A dispute exists between the Southeastern Pennsylvania Transportation Au- thority and its conductors represented by the United Transportation Union. The dispute has not heretofore been adjusted under the provisions of the Railway Labor Act, as amended, 45 U.S.C. 151-188 (the ‘‘Act’’). A first emergency board to investigate and report on the dispute was estab- lished on April 12, 2004, by Executive Order 13334 of April 10, 2004. The emergency board terminated upon issuance of its report. Subsequently, its recommendations were not accepted by the parties. A party empowered by the Act has requested that the President establish a second emergency board pursuant to section 9A of the Act (45 U.S.C. 159a). Section 9A(e) of the Act provides that the President, upon such request, shall appoint a second emergency board to investigate and report on the dispute. NOW, THEREFORE, by the authority vested in me as President by the Constitution and the laws of the United States, including section 9A of the Act, it is hereby ordered as follows: Section 1. Establishment of Emergency Board (‘‘Board’’). There is established, effective August 10, 2004, a Board of three members to be appointed by the President to investigate and report on this dispute. No member shall be pecuniarily or otherwise interested in any organization of railroad employ- ees or any carrier. The Board shall perform its functions subject to the availability of funds. Sec. 2. Report. Within 30 days after the creation of the Board, the parties to the dispute shall submit to the Board final offers for settlement of the dispute. Within 30 days after the submission of final offers for settlement of the dispute, the Board shall submit a report to the President setting forth its selection of the most reasonable offer. Sec. 3. Maintaining Conditions. As provided by section 9A(h) of the Act, from the time a request to establish a second emergency board is made until 60 days after the Board submits its report to the President, the parties to the controversy shall make no change in the conditions out of which the dispute arose except by agreement of the parties. Sec. 4. Records Maintenance. The records and files of the Board are records of the Office of the President and upon the Board’s termination shall be maintained in the physical custody of the National Mediation Board.
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Sec. 5. Expiration. The Board shall terminate upon the submission of the report provided for in section 2 of this order. W THE WHITE HOUSE, August 9, 2004.
[FR Doc. 04–18575 Filed 8–11–04; 8:45 am] Billing code 3195–01–P
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Reader Aids Federal Register Vol. 69, No. 155 Thursday, August 12, 2004
CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING AUGUST
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. 71 ...... 47357, 48141, 48142, Presidential Documents 3 CFR 48143, 48144, 48765, 48766 Executive orders and proclamations 741–6000 Executive Orders: 73...... 47358 The United States Government Manual 741–6000 13222 (See Notice of 97...... 48144 August 6, 2004) ...... 48763 Other Services Proposed Rules: 13334 (See EO 39 ...... 46456, 47028, 47031, Electronic and on-line services (voice) 741–6020 13351) ...... 50047 47035, 47038, 47040, 47041, Privacy Act Compilation 741–6064 13351...... 50047 47388, 47391, 47393, 47802, Public Laws Update Service (numbers, dates, etc.) 741–6043 Administrative Orders: 47804, 47806, 47808, 47811, TTY for the deaf-and-hard-of-hearing 741–6086 Notices: 47814, 48424, 48426, 49829 Notice of August 6, 71...... 48826 ELECTRONIC RESEARCH 2004 ...... 48763 World Wide Web Presidential 15 CFR Determinations: 4...... 49783 Full text of the daily Federal Register, CFR and other publications No. 2004-40 of July is located at: http://www.gpoaccess.gov/nara/index.html 21, 2004 ...... 46399 17 CFR Federal Register information and research tools, including Public 1...... 49784 5 CFR Inspection List, indexes, and links to GPO Access are located at: 30...... 49800 http://www.archives.gov/federallregister/ 531...... 47353 232...... 49803 E-mail 239...... 48370, 49805 7 CFR FEDREGTOC-L (Federal Register Table of Contents LISTSERV) is 240...... 48008 an open e-mail service that provides subscribers with a digital 400...... 48652 241...... 48008 form of the Federal Register Table of Contents. The digital form 402...... 48652 242...... 48008 of the Federal Register Table of Contents includes HTML and 407...... 48652 249...... 48370 PDF links to the full text of each document. 457...... 48652 274...... 49805 1435...... 48765 To join or leave, go to http://listserv.access.gpo.gov and select Proposed Rules: 18 CFR Online mailing list archives, FEDREGTOC-L, Join or leave the list 304...... 49824 358...... 48371 (orchange settings); then follow the instructions. 457...... 48166 388...... 48386 PENS (Public Law Electronic Notification Service) is an e-mail 1775...... 48174 service that notifies subscribers of recently enacted laws. 1777...... 48174 20 CFR To subscribe, go to http://listserv.gsa.gov/archives/publaws-l.html 1778...... 48174 429...... 48767 and select Join or leave the list (or change settings); then follow 1780...... 48174 Proposed Rules: the instructions. 1942...... 48174 603...... 50022 3570...... 48174 FEDREGTOC-L and PENS are mailing lists only. We cannot 4274...... 48174 21 CFR respond to specific inquiries. 8 CFR 1...... 47765, 48774 Reference questions. Send questions and comments about the 5...... 48774 Federal Register system to: [email protected] 274a...... 47763 17...... 49807 The Federal Register staff cannot interpret specific documents or 26...... 48774 9 CFR regulations. 203...... 48774 93...... 49783 207...... 48774 FEDERAL REGISTER PAGES AND DATE, AUGUST 314...... 48774 10 CFR 510...... 47360, 47361 46095–46398...... 2 Proposed Rules: 520...... 48774, 49808 46399–46978...... 3 50...... 46452 522...... 47361, 47362 46979–47352...... 4 431...... 47486 524 ...... 47361, 47363, 48391 878...... 48146 47353–47762...... 5 12 CFR 47763–48128...... 6 229...... 47290 26 CFR 48129–48358...... 9 Proposed Rules: 1 ...... 46401, 46982, 47364, 48359–48764...... 10 607...... 47984 48392 48765–49782...... 11 614...... 47984 14a...... 46401 49783–50048...... 12 615...... 47984 40...... 48393 620...... 47984 49...... 48393 301...... 49809 14 CFR 602...... 46982 23...... 47354 Proposed Rules: 39 ...... 46979, 47763, 48129, 1 ...... 47043, 47395, 47816, 48131, 48133, 48135, 48138, 47822, 48428, 48429, 48431, 48359, 48361, 48363, 48365, 49832, 49836, 49957 48366, 48368, 49957 40...... 48432
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49...... 48432 Proposed Rules: 414...... 47488 63...... 48188 301...... 49840 17...... 48184 417...... 46632, 46866 64...... 48188 418...... 47488 73 ...... 46474, 46476, 47399, 29 CFR 40 CFR 422...... 46866 48443 1910...... 46986 9...... 47210 423...... 46632 80...... 48440 Proposed Rules: 52 ...... 47365, 47366, 47773, 424...... 47488 90...... 46462 1210...... 48177 48150, 48395 484...... 47488 63...... 47001 486...... 47488 30 CFR 81...... 47366, 48792 48 CFR 44 CFR 917...... 48776 112...... 48794 Proposed Rules: 122...... 47210 64...... 46435 228...... 48444 31 CFR 123...... 47210 65...... 47780, 47786 229...... 48445 Proposed Rules: 124...... 47210 67...... 46436, 46437 1835...... 49845 538...... 48183 125...... 47210 Proposed Rules: 1852...... 49845 550...... 48183 180 ...... 47005, 47013, 47022, 67 ...... 47830, 47831, 47832 560...... 48183 48799 300 ...... 47377, 48153, 48398 45 CFR 49 CFR 32 CFR Proposed Rules: Proposed Rules: 192...... 48400 519...... 47766 51...... 47828 Ch. IX...... 48435 195...... 48400 Proposed Rules: 52 ...... 47399, 48186, 48434 46 CFR 375...... 47386 199...... 48433 63...... 47049, 48338 571...... 48805, 48818 322...... 48183 72...... 47828 71...... 47378 573...... 49819 73...... 47828 114...... 47378 577...... 49819 33 CFR 115...... 47378 74...... 47828 579...... 49822 100 ...... 46994, 46996, 49811 77...... 47828 125...... 47378 117 ...... 46998, 47771, 48394, 78...... 47828 126...... 47378 Proposed Rules: 48395, 49812 80...... 48827 167...... 47378 171...... 47074, 49846 165 ...... 48787, 48790, 49813, 81...... 47399, 48835 169...... 47378 172...... 47074, 49846 49816 96...... 47828 175...... 47378 173...... 47074, 49846 Proposed Rules: 180...... 47051 176...... 47378 175...... 47074 117...... 47045 300 ...... 47068, 47072, 48187, Proposed Rules: 178...... 47074, 49846 165...... 47047 48434 66...... 49844 179...... 49846 180...... 49846 36 CFR 42 CFR 47 CFR 571...... 47075 242...... 46999 403...... 48916 0...... 46438 Proposed Rules: 412...... 48916 1 ...... 46438, 47788, 47790 50 CFR 7...... 49841 413...... 48916 2...... 46438, 48157 418...... 48916 25...... 47790, 48157 17 ...... 47212, 47330, 48115 37 CFR 460...... 48916 73 ...... 46447, 47385, 47795, 20...... 48163 1...... 49960 480...... 48916 49818 100...... 46999 5...... 49960 482...... 48916 74...... 48157 229...... 48407 10...... 49960 483...... 48916 90...... 46438, 48157 402...... 47732 11...... 49960 485...... 48916 95...... 46438 635...... 47797 41...... 49960 489...... 48916 101...... 48157 648...... 47798 Proposed Rules: Proposed Rules: Proposed Rules: 660...... 46448 202...... 47396 403...... 46632 1...... 48188 679 ...... 46451, 47025, 47026 405...... 47488 2...... 46462, 48192 Proposed Rules: 38 CFR 410...... 47488 20...... 48440 17 ...... 47834, 48102, 48570 3...... 46426, 48148 411...... 46632, 47488 25...... 48192 635...... 49858
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REMINDERS JUSTICE DEPARTMENT under Federal Tort Claims List of hazardous air The items in this list were Prisons Bureau Act; comments due by 8-16- pollutants, petition editorially compiled as an aid UNICOR business operations; 04; published 6-17-04 [FR process, lesser quantity to Federal Register users. address changes and 04-13711] designations, and source Inclusion or exclusion from clarification; published 7-13- COMMERCE DEPARTMENT category list; comments this list has no legal 04 National Oceanic and due by 8-18-04; published significance. Atmospheric Administration 7-19-04 [FR 04-16335] SECURITIES AND Air pollution control; new EXCHANGE COMMISSION Fishery conservation and management: motor vehicles and engines: Securities: RULES GOING INTO West Coast States and Heavy duty diesel engines EFFECT AUGUST 12, Registered management Western Pacific and vehicles; in-use 2004 investment companies; fisheries— emissions testing; shareholder reports and comments due by 8-16- Pacific Coast groundfish; quarterly portfolio 04; published 6-10-04 [FR AGRICULTURE comments due by 8-17- disclosure; technical 04-13179] DEPARTMENT 04; published 6-18-04 amendment; published 8- [FR 04-13730] Heavy duty diesel engines Animal and Plant Health 12-04 and vehicles; in-use Pacific Coast groundfish; Inspection Service emissions testing; TRANSPORTATION comments due by 8-17- Exportation and importation of correction; comments due DEPARTMENT 04; published 7-7-04 animals and animal by 8-16-04; published 6- products: Federal Aviation [FR 04-15256] Administration 21-04 [FR 04-13930] Tuberculosis in cattle; import COMMODITY FUTURES Air programs; approval and Airworthiness directives: requirements TRADING COMMISSION promulgation; State plans Withdrawn; published 8- BURKHART GROB LUFT- Commodity Exchange Act: for designated facilities and 12-04 UND RAUMFAHRT GmbH Speculative position limits; pollutants: Livestock and poultry disease & CO KG; published 6- comments due by 8-16- New Jersey; comments due control: 21-04 04; published 6-17-04 [FR by 8-16-04; published 7- Brucellosis in sheep, goats, TRANSPORTATION 04-13678] 16-04 [FR 04-16208] and horses; DEPARTMENT COURT SERVICES AND Air quality implementation indemnification; published National Highway Traffic OFFENDER SUPERVISION plans; approval and 7-13-04 Safety Administration AGENCY FOR THE promulgation; various States: AGRICULTURE Motor vehicle safety DISTRICT OF COLUMBIA DEPARTMENT standards: Semi-annual agenda; Open for Montana; comments due by comments until further 8-19-04; published 7-20- Forest Service Defect and noncompliance— notice; published 12-22-03 04 [FR 04-16448] National Forest System lands: Early warning and [FR 03-25121] Ohio; comments due by 8- customer satisfaction Special use authorizations; DEFENSE DEPARTMENT 19-04; published 7-20-04 published 7-13-04 campaign [FR 04-16333] documentation; reporting Federal Acquisition Regulation COMMERCE DEPARTMENT Environmental statements; requirements; correction; (FAR): availability, etc.: Freedom of Information Act; published 8-12-04 Performance-based implementation: contracting use for Coastal nonpoint pollution TREASURY DEPARTMENT Appeals; fax and e-mail services; incentives; control program— submission procedures; Internal Revenue Service comments due by 8-17- Minnesota and Texas; published 8-12-04 Income taxes: 04; published 6-18-04 [FR Open for comments until further notice; COMMERCE DEPARTMENT Exchanges of personal 04-13618] published 10-16-03 [FR property; published 8-13- ENERGY DEPARTMENT National Oceanic and 03-26087] 04 Energy Efficiency and Atmospheric Administration Pesticide programs: Procedure and administration: Renewable Energy Office Marine mammals: Pesticide container and National Marine Mammal Business entities Consumer products; energy containment standards; Tissue Bank; access to classification; definitions conservation program: comments due by 8-16- tissue specimen samples; clarification; published 8- Energy conservation 04; published 6-30-04 [FR protocol; published 7-13- 12-04 standards—- 04-14463] 04 Commercial packaged Pesticides; tolerances in food, HEALTH AND HUMAN COMMENTS DUE NEXT boilers; test procedures animal feeds, and raw SERVICES DEPARTMENT WEEK and efficiency agricultural commodities: standards; Open for Food and Drug Humates; comments due by comments until further Administration 8-16-04; published 6-16- AGRICULTURE notice; published 12-30- Animal drugs, feeds, and DEPARTMENT 04 [FR 04-12913] 99 [FR 04-17730] Solid waste: related products: Agricultural Marketing ENERGY DEPARTMENT Municipal solid waste landfill Ivermectin and praziquantel Service paste; published 8-12-04 Federal Energy Regulatory permit program— Cotton classing, testing and Commission Indiana; comments due by HOMELAND SECURITY standards: Electric rate and corporate 8-16-04; published 7-16- DEPARTMENT Classification services to regulation filings: 04 [FR 04-16205] Coast Guard growers; 2004 user fees; Virginia Electric & Power Solid waste: Drawbridge operations: Open for comments until Co. et al.; Open for Municipal solid waste landfill Louisiana; published 8-12-04 further notice; published comments until further permit program— 5-28-04 [FR 04-12138] Ports and waterways safety: notice; published 10-1-03 Indiana; comments due by Maine Corps Base Camp CHEMICAL SAFETY AND [FR 03-24818] 8-16-04; published 7-16- Lejeune, NC; Atlantic HAZARD INVESTIGATION ENVIRONMENTAL 04 [FR 04-16204] Intracoastal Waterway; BOARD PROTECTION AGENCY Water pollution; effluent safety zone; published 7- Administrative claims; Air pollutants, hazardous; guidelines for point source 13-04 monetary damages filed national emission standards: categories:
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Meat and poultry products Performance-based of all program Fair credit reporting; affiliate processing facilities; Open contracting use for participants; comments marketing; comments due for comments until further services; incentives; due by 8-20-04; published by 8-16-04; published 7- notice; published 12-30-99 comments due by 8-17- 6-21-04 [FR 04-13874] 15-04 [FR 04-15950] [FR 04-12017] 04; published 6-18-04 [FR Mortgage and loan insurance NUCLEAR REGULATORY FEDERAL 04-13618] programs: COMMISSION Single family mortgage COMMUNICATIONS HEALTH AND HUMAN Environmental statements; insurance— COMMISSION SERVICES DEPARTMENT availability, etc.: National Housing Act; Digital television stations; table Food and Drug Hawaiian Home Lands; Fort Wayne State of assignments: Administration comments due by 8-16- Developmental Center; California; comments due by Administrative rulings and 04; published 6-15-04 Open for comments until 8-16-04; published 7-1-04 decisions: [FR 04-13431] further notice; published [FR 04-15003] Ozone-depleting substances Public and Indian housing: 5-10-04 [FR 04-10516] Radio stations; table of use; essential-use Indian Housing Block Grant POSTAL SERVICE assignments: designations— Program; minimum International Mail Manual: Arkansas and Albuterol used in oral funding extension; International Priority Mail Massachusetts; comments pressurized metered- comments due by 8-16- and International Surface due by 8-19-04; published dose inhalers; removed; 04; published 6-17-04 [FR Air Lift mailers; 7-19-04 [FR 04-16366] comments due by 8-16- 04-13721] discontinuance of volume Florida; comments due by 04; published 6-16-04 INTERIOR DEPARTMENT discount rates; comments 8-19-04; published 7-19- [FR 04-13507] Surface Mining Reclamation due by 8-18-04; published 04 [FR 04-16369] General enforcement and Enforcement Office 7-28-04 [FR 04-17124] Permanent program and Wisconsin; comments due regulations: SMALL BUSINESS abandoned mine land by 8-19-04; published 7- Exports; notification and ADMINISTRATION 19-04 [FR 04-16368] recordkeeping reclamation plan submissions: Disaster loan areas: requirements; comments FEDERAL DEPOSIT Maine; Open for comments due by 8-16-04; published Alaska; comments due by INSURANCE CORPORATION until further notice; 6-1-04 [FR 04-12271] 8-18-04; published 7-19- Fair and Accurate Credit 04 [FR 04-16287] published 2-17-04 [FR 04- Transactions Act; Product jurisdiction: Indiana; comments due by 03374] implementation: Mode of action and primary 8-18-04; published 7-19- STATE DEPARTMENT Fair credit reporting mode of action of 04 [FR 04-16284] combination products; Consular services; fee provisions; affiliate Kentucky; comments due by schedule; comments due by marketing; comments due definitions; comments due 8-18-04; published 7-19- by 8-20-04; published 6- 8-18-04; published 7-19-04 by 8-16-04; published 7- 04 [FR 04-16286] [FR 04-16363] 15-04 [FR 04-15950] 24-04 [FR 04-14265] Maryland; comments due by Reports and guidance 8-18-04; published 7-19- OFFICE OF UNITED STATES FEDERAL RESERVE TRADE REPRESENTATIVE SYSTEM documents; availability, etc.: 04 [FR 04-16285] Texas; comments due by 8- Trade Representative, Office Fair and Accurate Credit Evaluating safety of 18-04; published 7-19-04 of United States Transactions Act; antimicrobial new animal [FR 04-16283] Generalized System of implementation: drugs with regard to their microbiological effects on JUSTICE DEPARTMENT Preferences: Fair credit reporting bacteria of human health Nonimmigrants; removal 2003 Annual Product provisions (Regulation V); concern; Open for orders, countries to which Review, 2002 Annual affiliate marketing; comments until further aliens may be removed; Country Practices Review, comments due by 8-16- notice; published 10-27-03 comments due by 8-18-04; and previously deferred 04; published 7-15-04 [FR [FR 03-27113] published 7-19-04 [FR 04- product decisions; 04-15950] 16193] petitions disposition; Open FEDERAL TRADE HOMELAND SECURITY DEPARTMENT LABOR DEPARTMENT for comments until further COMMISSION notice; published 7-6-04 Coast Guard Employment and Training Fair and Accurate Credit Administration [FR 04-15361] Anchorage regulations: Transactions Act; Aliens: TRANSPORTATION implementation: Maryland; Open for Labor certification for DEPARTMENT comments until further Affiliate marketing; permanent employment in Federal Aviation notice; published 1-14-04 comments due by 8-16- U.S.; backlog reduction; Administration 04; published 6-15-04 [FR [FR 04-00749] comments due by 8-20- Air carrier certification and 04-13481] 04; published 7-21-04 [FR HOMELAND SECURITY operations: Fair Credit and Reporting Act: DEPARTMENT 04-16536] NATIONAL AERONAUTICS Antidrug and alcohol misuse Summaries of consumer Immigration and Customs prevention programs for rights and notices of Enforcement Bureau AND SPACE ADMINISTRATION personnel engaged in duties; comments due by Nonimmigrants; removal specified aviation 8-16-04; published 7-16- orders, countries to which Federal Acquisition Regulation (FAR): activities; comments due 04 [FR 04-16010] aliens may be removed; by 8-16-04; published 5- Performance-based GENERAL SERVICES comments due by 8-18-04; 17-04 [FR 04-10815] contracting use for ADMINISTRATION published 7-19-04 [FR 04- Airworthiness directives: 16193] services; incentives; Acquisition regulations: comments due by 8-17- Airbus; comments due by 8- Debarment, suspension, and HOUSING AND URBAN 04; published 6-18-04 [FR 16-04; published 7-15-04 ineligibility requirements; DEVELOPMENT 04-13618] [FR 04-16031] comments due by 8-17- DEPARTMENT NATIONAL CREDIT UNION Empresa Brasileira de 04; published 6-18-04 [FR Grants: ADMINISTRATION Aeronautica S.A. 04-13762] Faith-based organizations; Fair and Accurate Credit (EMBRAER); comments Federal Acquisition Regulation participation in department Transactions Act; due by 8-16-04; published (FAR): programs; equal treatment implementation: 7-22-04 [FR 04-16681]
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Grob-Werke; comments due Commission for Assistance (phone, 202–512–1808). The H.R. 4417/P.L. 108–299 by 8-16-04; published 7- to a Free Cuba, text will also be made 15-04 [FR 04-16097] recommendations; available on the Internet from To modify certain deadlines Honeywell; comments due implementation; comments GPO Access at http:// pertaining to machine- by 8-16-04; published 6- due by 8-16-04; published www.gpoaccess.gov/plaws/ readable, tamper-resistant 16-04 [FR 04-13563] 6-16-04 [FR 04-13630] index.html. Some laws may entry and exit documents. (Aug. 9, 2004; 118 Stat. 1100) Airworthiness standards: TREASURY DEPARTMENT not yet be available. Special conditions— Internal Revenue Service H.R. 4427/P.L. 108–300 Learjet Inc., Model 55, H.R. 2443/P.L. 108–293 Income taxes: 55B and 55C airplanes; Coast Guard and Maritime To designate the facility of the Safe harbor sale and comments due by 8-16- Transportation Act of 2004 United States Postal Service leaseback transactions; 04; published 7-15-04 (Aug. 9, 2004; 118 Stat. 1028) at 73 South Euclid Avenue in uniform capitalization of [FR 04-16101] Montauk, New York, as the interest expense; H.R. 3340/P.L. 108–294 Class E airspace; comments ‘‘Perry B. Duryea, Jr. Post comments due by 8-18- To redesignate the facilities of due by 8-16-04; published Office’’. (Aug. 9, 2004; 118 04; published 5-20-04 [FR the United States Postal 7-2-04 [FR 04-15035] Stat. 1101) 04-11361] Service located at 7715 and TRANSPORTATION TREASURY DEPARTMENT 7748 S. Cottage Grove S. 2712/P.L. 108–301 DEPARTMENT Avenue in Chicago, Illinois, as Federal Highway Thrift Supervision Office the ‘‘James E. Worsham Post To preserve the ability of the Administration Fair and Accurate Credit Office’’ and the ‘‘James E. Federal Housing Engineering and traffic Transactions Act; Worsham Carrier Annex Administration to insure operations: implementation: Building’’, respectively, and for mortgages under sections 238 Highway bridge replacement Fair credit reporting; affiliate other purposes. (Aug. 9, 2004; and 519 of the National and rehabilitation program; marketing; comments due 118 Stat. 1089) Housing Act. (Aug. 9, 2004; comments due by 8-20- by 8-16-04; published 7- H.R. 3463/P.L. 108–295 118 Stat. 1102) 04; published 6-21-04 [FR 15-04 [FR 04-15950] 04-13839] SUTA Dumping Prevention Act Last List August 11, 2004 TRANSPORTATION of 2004 (Aug. 9, 2004; 118 DEPARTMENT LIST OF PUBLIC LAWS Stat. 1090) Maritime Administration H.R. 4222/P.L. 108–296 This is a continuing list of Subsidized vessels and To designate the facility of the public bills from the current Public Laws Electronic operators: United States Postal Service session of Congress which Notification Service Maritime Security Program; located at 550 Nebraska have become Federal laws. It (PENS) comments due by 8-19- Avenue in Kansas City, may be used in conjunction 04; published 7-20-04 [FR Kansas, as the ‘‘Newell with ‘‘PLUS’’ (Public Laws 04-16454] George Post Office Building’’. Update Service) on 202–741– TREASURY DEPARTMENT (Aug. 9, 2004; 118 Stat. 1094) PENS is a free electronic mail 6043. This list is also Comptroller of the Currency notification service of newly available online at http:// H.R. 4226/P.L. 108–297 Fair and Accurate Credit enacted public laws. To www.archives.gov/ Transactions Act; Cape Town Treaty subscribe, go to http:// federal register/public laws/ implementation: — — Implementation Act of 2004 listserv.gsa.gov/archives/ public laws.html. Fair credit; affiliate — (Aug. 9, 2004; 118 Stat. 1095) publaws-l.html marketing; comments due The text of laws is not H.R. 4327/P.L. 108–298 by 8-16-04; published 7- published in the Federal To designate the facility of the Note: This service is strictly 15-04 [FR 04-15950] Register but may be ordered United States Postal Service for E-mail notification of new TREASURY DEPARTMENT in ‘‘slip law’’ (individual located at 7450 Natural Bridge laws. The text of laws is not Foreign Assets Control pamphlet) form from the Road in St. Louis, Missouri, available through this service. Office Superintendent of Documents, as the ‘‘Vitilas ‘Veto’ Reid PENS cannot respond to Cuban assets control U.S. Government Printing Post Office Building’’. (Aug. 9, specific inquiries sent to this regulations: Office, Washington, DC 20402 2004; 118 Stat. 1099) address.
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