[Federal Register Volume 59, Number 87 (Friday, May 6, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-10853]


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[Federal Register: May 6, 1994]


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DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Part 181

[CGD 92-065]
RIN 2115-AE37

 

Expanded Hull Identification Number and New Requirements for 
Certificates of Origin

AGENCY: Coast Guard, DOT.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Coast Guard proposes amending the regulations concerning 
vessel Hull Identification Numbers (HIN) and establishing new 
regulations requiring Certificates of Origin for new vessels offered 
for sale in the United States. The Coast Guard is proposing the 
regulations in order to provide additional information identifying 
vessels and establishing evidence of vessel ownership to aid in marine 
investigations, deter theft, and provide a more useful vessel 
identifier for the purposes of developing the vessel identification 
system, as required by legislation. The Coast Guard also proposes to 
make several editorial corrections to its HIN regulations.

DATES: Comments must be received on or before September 6, 1994.

ADDRESSES: Comments may be mailed to the Executive Secretary, Marine 
Safety Council (G-LRA/3406) (CGD 92-065), U.S. Coast Guard 
Headquarters, 2100 Second Street SW., Washington, DC 20593-0001, or may 
be delivered to room 3406 at the above address between 8 a.m. and 3 
p.m., Monday through Friday, except Federal holidays. The telephone 
number is (202) 267-1477. Comments on collection of information 
requirements must be mailed also to the Office of Information and 
Regulatory Affairs, Office of Management and Budget, 725 17th Street, 
NW., Washington, DC 20503, Attn: Desk Officer, U.S. Coast Guard.
    The Executive Secretary maintains the public docket for this 
rulemaking. Comments will become part of this docket and will be 
available for inspection or copying at room 3406, U.S. Coast Guard 
Headquarters.
    A copy of the material listed in ``Incorporation by Reference'' of 
this preamble is available for inspection at room 1505, U.S. Coast 
Guard Headquarters.

FOR FURTHER INFORMATION CONTACT:
Mr. Alston Colihan, Auxiliary, Boating, and Consumer Affairs Division, 
(202) 267-0981.

SUPPLEMENTARY INFORMATION:

Request for Comments

    The Coast Guard encourages interested persons to participate in 
this rulemaking by submitting written data, views or arguments. Persons 
submitting comments should include their name and address, identify 
this rulemaking (CGD 92-065) and the specific section of this proposal 
to which each comment applies, and give a reason for each comment. The 
Coast Guard requests that all comments and attachments be submitted in 
an unbound format suitable for copying and electronic filing. If not 
practical, a second copy of any bound materials is requested. Persons 
wanting acknowledgement of receipt of comments should enclose a 
stamped, self-addressed postcard or envelope.
    The Coast Guard will consider all comments received during the 
comment period. It may change this proposal in view of the comments.
    The Coast Guard plans no public hearing. Persons may request a 
public hearing by writing to the Marine Safety Council at the address 
under ADDRESSES. If it determines that the opportunity for oral 
presentations will aid this rulemaking, the Coast Guard will hold a 
public hearing at a time and place announced by a later notice in the 
Federal Register.

Drafting Information

    The principal persons involved in drafting this document are Mr. 
Alston Colihan, Project Manager, and Helen Boutrous, Project Counsel, 
Office of Chief Counsel.

Background and Purpose

    The Secretary of Transportation is required to establish the Vessel 
Identification System (VIS) (46 U.S.C. chapters 125, 131 & 313) for use 
by the public and law enforcement officials. The Secretary has 
delegated to the Commandant, U.S. Coast Guard, the authority to 
implement VIS. VIS will provide a nationwide pool of vessel and vessel 
owner information that will help in identification and recovery of 
stolen vessels and deter vessel theft. This rulemaking would aid in the 
development of VIS by expanding the existing 12 character HIN to 
include certain vessel-specific information and thereby create a more 
useful vessel identification number. Further, requiring vessel 
manufacturers and importers to provide a Certificate of Origin with 
each vessel produced or imported for the purposes of sale would ensure 
the availability of documentation certifying this information and 
establishing a chain of ownership.

Discussion of Proposed Amendments

    Investigations of lost and stolen vessels depend in large part on 
the proper authorities' ability to identify a vessel and establish a 
chain of ownership. The proposed regulations would aid in this pursuit 
by expanding the current 12 character HIN to include detailed 
information about each vessel. In addition, a check digit in the 
expanded HIN would make alteration of an HIN more difficult thereby 
helping to prevent fraud in the sale of vessels. The proposed 
regulations would also require that vessel manufacturers provide a 
Certificate of Origin certifying the truth about certain information in 
the HIN and for use as the first document in the paper trail 
establishing proof of vessel ownership.
    Removal of the definition for ``model year'' would clear up a 
drafting error which has existed since the last time the HIN 
regulations were amended in 1984. Finally, removal of the references to 
``State Boating Law Administrator'' in 33 CFR 181.31(c) would allow 
States which use their Department of Motor Vehicles as vessel numbering 
and titling authorities to issue HINs to individuals building their own 
vessels.
    The following discusses the proposed changes to 33 CFR part 181:

(a) ``Model Year'' Definition

    The definition of ``model year'' would be removed from Sec. 181.3. 
Up until 1984 the regulations allowed for two methods of indicating the 
date of manufacture in the last four characters of the 12 character 
HIN. When those two formats were devised, it was the Coast Guard's 
understanding that the new model year would not commence prior to 
August. Some manufacturers complained that they wanted to vary the 
introduction date of the new model year from year to year, but that 
they were prevented from doing so by the HIN regulations which defines 
model year as the period beginning August 1 of any year and ending on 
July 31 of the following year. The Coast Guard amended the HIN 
regulations in 1984 to give vessel manufacturers the freedom to 
designate model year in the HIN as they requested. The Coast Guard 
amended Sec. 181.25(a) to require characters 11 and 12 to indicate the 
model year using the last two characters of the model year such as 
``84'' for 1984. However, due to a drafting error, the Coast Guard 
failed to delete the outdated and superfluous definition of ``model 
year.'' The proposed amendments would remove the definition of ``model 
year'' from part 181.

(b) Incorporation by Reference

    The following material would be incorporated by reference in 
Sec. 181.4:
    International Organization for Standardization (ISO) Standard 3166 
``Codes for the representation of names of countries.'' International 
Organization for Standardization (ISO) Standard 1073/I-1976 
``Alphanumeric character sets for optical recognition--Part I: 
Character Set OCR-A--Shapes and dimensions of the printed image.'' 
Copies of the material are available for inspection where indicated 
under ADDRESSES. Copies of the material are available at the addresses 
in Sec. 181.4. Before publishing a final rule, the Coast Guard will 
submit this material to the Director of the Federal Register for 
approval of the incorporations by reference.
    ISO Standard 3166 contains two character alphabetic codes which 
would be used to indicate the ``country code'' in the expanded HIN. ISO 
Standard 1073/I-1976 prescribes shapes and sizes of alphanumeric 
characters for optical character recognition (OCR) systems, which means 
that the characters are both human and machine readable.

(c) Nineteen Character Hull Identification Number

    The existing Hull Identification Number (HIN) is a unique 12 
character serial number required on each recreational vessel 
manufactured in or imported into the United States for the purposes of 
sale. The Coast Guard assigns the first three characters, a 
Manufacturer Identification Code (MIC) which identifies the 
manufacturer or importer; characters four through eight are a 
manufacturer serial number; characters nine and ten indicate date of 
certification for vessels subject to safety standards or the date of 
manufacture for vessels not subject to standards; and characters eleven 
and twelve indicate the model year.
    There are two serious problems involving the current 12 character 
HIN format. Thieves can alter an HIN and ``launder'' a stolen vessel in 
States with ineffective titling and registration programs. Similarly, 
the last four characters in many HINs are fraudulently altered as a 
means of misrepresenting vessels as ``newer.''
    As early as May 1987, the National Auto Theft Bureau (NATB), which 
is supported by more than 600 casualty insurance companies, recommended 
that the Coast Guard adopt a 17 character HIN format (similar to the 
format required for the Vehicle Identification Number [VIN] on an 
automobile) as a means of detecting and deterring vessel theft. Each 
VIN contains certain characters which describe features such as body 
style and engine type which are specific to the automobile to which the 
VIN is assigned. A VIN also contains a check digit which assures the 
integrity of the other characters in a VIN. According to the NATB and 
officials of the National Association of State Boating Law 
Administrators (NASBLA), the additional HIN characters would lead to 
increased recovery of stolen vessels and more successful enforcement 
efforts, thereby deterring would-be thieves.
    During meetings with the International Standards Organization (ISO) 
some ISO member countries expressed a desire for the Coast Guard to 
include a two character country of MIC registration code as part of the 
expanded HIN format to distinguish between MICs issued by different 
foreign countries. The Coast Guard agrees that including the two 
character country of MIC registration code in the proposed HIN would be 
appropriate.
    The proposed expanded HIN would consists of 19 characters. The 
additional seven characters would indicate country of MIC registration, 
length, hull material, principal means of propulsion, vessel type and a 
check digit. The expanded HIN with its check digit would reflect 
additional information useful to law enforcement authorities 
investigating vessel thefts and provide a useful means of identifying 
vessels in VIS.
    Section 181.25 would be revised to require that each of the Hull 
Identification Numbers prescribed by Sec. 181.23 must consist of 19 
characters uninterrupted by slashes, hyphens or spaces:
    (1) Characters one and two would be the two character alphabetic 
``country code'' from ISO Standard 3166. The country code for 
Manufacturer ID Codes the Coast Guard assigns in the United States, for 
example, would be ``US.''
    (2) Characters three through five would be the existing 
manufacturer identification code the Coast Guard assigns to the vessel 
manufacturer in accordance with Sec. 181.31(a).
    (3) Characters six through ten would be the serial number the 
manufacturer currently assigns in accordance with Sec. 181.25(b).
    (4) Characters eleven and twelve would indicate date of 
certification for vessels subject to safety standards or the date of 
manufacture for vessels not subject to standards in accordance with the 
existing format specified in Sec. 181.25(c).
    (5) Characters thirteen and fourteen would indicate the model year 
in accordance with the existing format specified in Sec. 181.25(d).
    (6) The fifteenth character would indicate overall length of the 
vessel using a corresponding letter of the English alphabet. The 
character, ``A,'' would indicate a vessel with a hull length of less 
than six feet; ``B'' would indicate a vessel with a hull length of six 
feet to 10 feet, 11 inches; ``C'' would indicate 11 feet; ``D'' would 
indicate 12 feed, and so on. The character, ``Z'', would indicate a 
vessel with a hull length of more than 31 feet. Inches would not be 
included in the measurement of length, therefore, 15 feet, 10 inches is 
15 feet and 16 feet, 2 inches is 16 feet.
    (7) The sixteen character would indicate hull material using a 
corresponding Arabic numeral. Arabic numerals one through eight would 
indicate aluminum, ferrocement, fiber reinforced plastic (FRP), 
flexible fabric, foam, plastic, steel and wood, respectively.
    (8) The seventeenth character would indicate the principal means of 
propulsion of the vessel using a corresponding Arabic numeral. Arabic 
numerals one through nine would indicate air propeller, bracket mounted 
outboard, inboard, inboard jet, inboard/outdrive, nonpowered, outboard, 
sail and sail with inboard auxiliary, respectively. Footnotes to a 
table in this section would distinguish between which Arabic numerals 
to use to indicate nonpowered vessels, sailboats and sailboats with 
auxiliary power.
    (9) The eighteenth character would indicate the type of vessel 
using a corresponding Arabic numeral. Arabic numerals one through nine 
would indicate air cushion vehicle; canoe, kayak, sailboard or 
surfboard; inflatable; monohull/cabin configuration; monohull/closed 
bow; monohull/open bow; multihull/cabin or closed bow; multihull/open 
deck; and personal watercraft, respectively. Footnotes to a table in 
this section would distinguish between which Arabic numerals to use to 
indicate the vessel types described above.
    (10) The nineteenth character would be a check digit determined by 
performing certain arithmetic calculations involving the previous 18 
characters. Characters consisting of letters of the English alphabet 
would be converted to corresponding numerical values. A diagram in the 
section would show how the calculations should be performed. The Coast 
Guard has developed a computer program which calculates the check digit 
and is available to any vessel manufacturer with a computer. The Coast 
Guard has also developed several work sheets to help determine the HIN 
for a vessel which are also available.

(d) Reference to State Boating Law Administrator

    Section 181.31 prescribes the regulations on the assignment of a 
Manufacturer Identification Code (MIC) to each recreational vessel 
manufacturer and importer. According to Sec. 181.31(c), persons who are 
building vessels for their own use and not for the purposes of sale, 
must obtain an entire Hull Identification Number from the State Boating 
Law Administrator of the State where the vessel will be principally 
used, in lieu of applying for a MIC. A number of the States use their 
Department of Motor Vehicles (DMV) for numbering and titling of vessels 
and the DMV would issue a State HIN. Under the proposed amendments, 
references to ``State Boating Law Administrator'' would be removed from 
the section and the words ``the issuing authority of the State'' would 
be added in their place.

(e) Certificate of Origin

    The Secretary is required to include information assisting law 
enforcement officials in VIS (46 U.S.C. 12501(b)(6)). A Certificate of 
Origin (COO) is a document issued by a product's manufacturer 
certifying to the truth of certain facts. Many States require vessel 
owners to provide a COO before they will issue a title or register and 
number a vessel. Thus, a COO is usually the first document in the paper 
trail identifying a vessel and establishing proof of ownership. 
Unfortunately, many vessel manufacturers do not issue COOs for vessels 
they manufacture or they issue COOs which many States consider 
unacceptable.
    A purchaser's possession of a standardized COO for a vessel would 
ensure that documentation of the vessel's chain of ownership is 
established. This would aid law enforcement investigations by providing 
a means to demonstrate vessel ownership as well as providing a means to 
certify vessel information that could be used in the development of 
VIS.
    Under the proposed amendments the Coast Guard would add a new 
Subpart D--``Certificates of Origin for Boats.'' The proposed 
amendments would require manufactures and U.S. importers of foreign-
built vessels to provide a completed COO with each vessel manufactured 
or imported. The issuing authorities in the States would be given the 
option of issuing COOs to individuals building their own vessels or 
exempting them from the requirement altogether.

Discussion of Proposed Form

    The Coast Guard is considering the development of a standardized 
COO form. For the reader's convenience, a prototype of a proposed form 
is reproduced in appendix A. This form should be considered in 
conjunction with the proposed regulations. Comments or suggestions 
pertaining to the format or content will be welcomed. Also, the Coast 
Guard specifically seeks comments on the most cost efficient manner to 
create and distribute the forms. Any proposed form will be submitted to 
the Office of Management and Budget for approval prior to publication 
of the final rule.

Discussion of Requirement for Certificate of Origin

    A COO furnished with a recreational vessel in accordance with 
Sec. 181.43 would:
    (a) Be signed by or on behalf of the vessel manufacturer; and
    (b) Recite the following:
    (1) The vessel's 19 character hull identification number assigned 
in accordance with Sec. 181.25;
    (2) The date on which the COO is issued;
    (3) The model name or numerical designation for the vessel;
    (4) The length of the vessel in feet and inches;
    (5) The beam of the vessel in feet and inches;
    (6) Whether the vessel is for commercial or recreational use;
    (7) The name and address of the dealer or individual to whom the 
vessel is first transferred; and
    (8) The place the vessel is constructed (plant location).

Solicitation of Views

    The Coast Guard is particularly interested in receiving comments on 
the following issues:
    (a) The majority of the recreational vessel manufacturers are small 
volume builders who lack computers and cannot use a computer program 
developed by the Coast Guard. These manufacturers may have a difficult 
time determining the check digit in the proposed 19 character Hull 
Identification Number. When using simple arithmetic, those calculations 
may take as long as 15 minutes per vessel. Is 15 minutes a reasonable 
estimate for performing the calculation?
    (b) Should the Coast Guard consider expecting certain classes of 
low cost vessels from the 19 character HIN, or do States which number 
all watercraft insist on universal application of this requirement?
    (c) Are there other methods for calculation of the check digit 
which are not as time consuming and will still assure the integrity of 
the other characters in an HIN?
    (d) The proposed regulations will require a COO for each new vessel 
manufactured or imported. Since a COO is unique to the vessel to which 
it is assigned, there may be some additional requirements associated 
with ensuring that the proper COO accompanies each vessel, particularly 
for importers of inflatables and similar, high volume, low cost vessels 
which are shipped in bulk containers. As a result, the COO requirement 
in the proposed regulations may require change in the manner in which 
small, high volume vessels are packaged for shipment. Should the Coast 
Guard consider excepting from the COO requirement certain classes of 
low cost vessels, or vessels involving special problems associated with 
the manner in which they are shipped?
    (e) Do the States which number all watercraft insist on universal 
application of the COO requirement?
    (f) A prototype of a proposed COO form is reproduced in appendix A. 
The Coast Guard proposes issuing a COO template to all boat 
manufactures and importers which they could copy to make COO forms for 
each boat. The Coast Guard would partially complete the COO templates 
with each manufacturer (or importer) name and address and the first 
five characters of the HIN as a means for minimizing information 
collection burdens.
    However, the Coast Guard is seeking comments on whether the 
proposed COO contains sufficient security features and information to 
make it an effective document. The NASBLA Numbering and Titling 
Committee has recommended, through a mailing to the Coast Guard, that 
the COO form be machine readable utilizing the OCR-A font which 
provides the criteria for character set and print quality for optical 
character recognition; be uniform in all jurisdictions; and conform to 
the following format, standards, security, and specifications:
    (1) Have an engraved border produced from banknote engraved 
artwork;
    (2) Feature a prismatic, i.e., rainbow printing which is used as a 
deterrent to color copying, and/or a copy void pantograph, i.e., the 
word ``void'' appears when the document is copied;
    (3) Be printed using erasable fluorescent background inks which 
fluoresce under ultraviolet light and react to any attempt to erase 
information;
    (4) Include a background security design consisting of a 
repetitious pattern which hinders counterfeiting efforts;
    (5) Be printed on sensitized security paper that is reactive to 
chemicals commonly used to alter documents;
    (6) Be printed on non optical brightener paper without added 
optical brighteners which will not fluoresce under ultraviolet light;
    (7) Include a microline--a line of small alpha characters in 
capital letters which requires a magnifying glass to read;
    (8) Bear a pre-printed consecutive number for control purposes;
    (9) Consist of complex colors which are developed by using a 
mixture of two or more of the primary colors (red, yellow and blue) and 
black if required; and
    (10) Contain a security thread with or without a watermark, and/or 
an intaglio print with or without a latent image, and/or a security 
laminate.
    The Coast Guard's preliminary investigations indicate that due to 
the high cost of creating forms meeting the NASBLA suggested 
requirements, the Coast Guard could not absorb the cost of printing COO 
forms meeting the NASBLA security features. The Coast Guard does not 
have the authority to charge manufacturers to reimburse the Coast Guard 
for its expenditures on COO forms. Therefore, if the Coast Guard were 
to adopt the NASBLA recommended security features, manufacturers would 
be responsible for creating or purchasing the forms on their own.
    Are there interested parties who believe the NASBLA recommended 
security features would be appropriate for a State issued certificate 
of title, but are excessive for a manufacturer issued certificate of 
origin?
    Some manufacturers build thousands of vessels annually, while 
others may build as few as a single vessel annually. What do printers 
estimate would be the costs to various volume boat manufacturers for 
creating and printing forms meeting the NASBLA recommended security 
features?
    If the Coast Guard were able to obtain authorized funding, what 
would be the cost to the Coast Guard for creating, printing, partially 
completing, and distributing forms meeting the NASBLA recommended 
security features to various volume boat manufacturers?
    Once the contents and security features of a finalized COO form are 
developed, based upon comments received, what are the most equitable 
and cost-efficient methods for creating, printing, and distributing COO 
forms to boat manufacturers?
    (g) The proposed Sec. 181.47 addresses the subject of duplicate COO 
forms.
    (1) Who should be able to apply for a duplicate COO form from a 
boat manufacturer?
    (2) What information should a duplicate COO contain?
    (3) Should an affidavit or other type of proof be required as a 
condition to obtaining a duplicate COO form?
    (4) If a duplicate COO must contain the same information as an 
original, should the regulations require the manufacturer to retain a 
copy of each original COO form? For how long?

Regulatory Assessment

    This proposal is not a significant regulatory action under 
Executive Order 12866, and has not been reviewed by the Office of 
Management and Budget. It is also not significant under the 
``Department of Transportation Regulatory Policies and Procedures'' (44 
FR 11040; February 26, 1979). The Coast Guard expects the economic 
impact of this proposal to be so minimal that a Regulatory Assessment 
is unnecessary.
    This project would benefit law enforcement officers by aiding in 
deterrence and detection of vessel fraud and theft. An estimated 
2,000,000 recreational vessels are manufactured or imported annual. 
Issuing authorities in the States issue an estimated 17,000 HINs to 
individuals building their own vessels annually. This means an 
estimated 2,017,000 HINs are affixed annually. The estimated average 
cost for the affixing the existing 12 character HIN is $.50 per vessel. 
The estimated cost of expansion to a 19 character format is an 
additional $.25 per vessel, for a total cost of approximately $.75 per 
vessel.
    The Coast Guard is soliciting specific comments on the estimated 
costs for COOs.
    The Coast Guard considered three alternatives in developing the 
proposed rulemaking.
    (a) Take no action. If the Coast Guard fails to take any action, 
the numbers of vessels stolen and the incidence of vessel fraud 
involving altered HINs will continue to increase. In addition, the 
development of VIS requires a means for identification of each vessel 
and proof of vessel ownership. Use of the 19 character HIN and a COO 
requirement appear to be the best way to accomplish those requirements. 
Many of the States and many law enforcement agencies support the 
proposal for a 19 character HIN and NASBLA, the National Boating Safety 
Advisory Council (NBSAC) and the National Association of Marine 
Investigators (NAMI), all support Coast Guard adoption of the 19 
character HIN. The Coast Guard has also received numerous complaints 
from owners who are unable to register their vessels because they do 
not have a COO.
    (b) Initiate a rulemaking to:
    (1) Amend the HIN regulations in 33 CFR part 181 to require 
additional information about the vessel to be reflected in the HIN and 
add a requirement for a check digit to aid in the prevention of fraud, 
thereby expanding the current HIN format from 12 to 19 characters; and
    (2) Require manufacturers and importers to complete a Builder's 
Certification.
    Expanding the HIN to 19 characters would provide the best means of 
developing a vessel identifier for VIS and help to discourage and 
detect alterations of HINs through inclusion of the check digit. While 
requiring all vessel manufacturers to provide a completed Builder's 
Certification would have the advantage of utilizing one form for all 
vessels whether documented, numbered or titled, it would prove overly 
burdensome to many manufacturers and importers.
    The Builder's Certification is designed for use by those 
documenting a vessel under 46 CFR part 67. Obtaining endorsements for 
documented vessels requires detailed information about the vessel, 
including the country in which the vessel and its major components were 
manufactured. Since a COO does not satisfy these documentation 
information requirements, it is not accepted as evidence of ownership 
for the purposes of documentation. The Builder's Certification 
satisfies documentation requirements, but would require information 
well beyond what is needed for VIS purposes and it would be overly 
burdensome to require manufacturers and importers to complete a 
Builder's Certification for every recreational vessel. The estimated 
reporting burden for the Builder's Certification is 30 minutes, while 
the estimated burden to complete the COO is five minutes. Therefore, 
requiring a Builder's Certification is not the preferred alternative 
for establishing the chain of ownership for the purposes of VIS.
    (c) Initiate a rulemaking to:
    (1) Amend the HIN regulations in 33 CFR part 181 to require 
additional information about the vessel to be reflected in the HIN and 
add a requirement for a check digit to aid in the prevention of fraud, 
thereby expanding the current HIN format from 12 to 19 characters; and
    (2) Require manufacturers and importers to provide a completed COO 
for each recreational vessel they manufacture or import. This is the 
preferred alternative.
    This alternative would provide VIS with the preferred 19 character 
HIN as well as the best method of establishing the chain of ownership 
for VIS purposes through the COO requirement. The COO requirement would 
provide all the information necessary for VIS and would take just five 
minutes to complete.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the 
Coast Guard must consider whether this proposal will have a significant 
economic impact on a substantial number of small entities. ``Small 
entities'' include independently owned and operated small business that 
are not dominant in their field and that otherwise qualify as ``small 
business concerns'' under section 3 of the Small Business Act (15 
U.S.C. 632).
    The proposed regulations will apply to the following small 
entities: Small manufacturers building vessels, small importers 
importing vessels and State issuing authorities.
    There are reporting requirements associated with an expanded HIN 
that could be more burdensome to small entities than to the larger 
volume manufacturers, especially in the calculation of the check digit. 
Eighty percent of the new recreational vessels manufactured annually 
are build by 20 percent of the industry. These are large companies with 
engineering departments that are equipped with computers and the 
expertise to understand and properly encode the additional characters 
and the check digit. The majority of the recreational vessel 
manufacturers, however, are small volume builders who may have a more 
difficult time implementing the regulations and making the necessary 
calculations to determine the check digit. When using simple 
arithmetic, those calculations may take as long as 15 minutes per 
vessel. The Coast Guard has developed a computer program which 
calculates the check digit which is available to any vessel 
manufacturer with a computer. The Coast Guard has also developed 
several work sheets to help determine the HIN for a vessel and the 
worksheets are also available. Therefore, preliminary analysis 
indicates that a 19 character HIN will not have a significant economic 
impact on a substantial number of small entities.
    The requirement for a COO may also result in additional 
requirements for small entities. Since a COO is unique to the vessel to 
which it is assigned, there may be some additional requirements 
associated with assuring that the proper COO accompanies each vessel, 
particularly for importers of inflatables and similar, high volume, low 
cost vessels which are shipped in bulk containers. As a result, the COO 
requirement in the proposed regulations may require changes in the 
manner in which small, high volume vessels are packaged for shipment. 
However, a preliminary analysis indicates that the COO requirement will 
not result in a significant impact on a substantial number of small 
entities.
    Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that 
this proposal, if adopted, will not have a significant economic impact 
on a substantial number of small entities. If, however, you think that 
your business or organization qualifies as a small entity and that this 
proposal will have a significant economic impact on your business or 
organization, please submit a comment (see ADDRESSES) explaining why 
you think it qualifies and in what way and to what degree this proposal 
will economically affect it.

Collection of Information

    Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), the 
Office of Management and Budget (OMB) reviews each proposed rule that 
contains a collection of information requirement to determine whether 
the practical value of the information is worth the burden imposed by 
its collection. Collection of information requirements include 
reporting, recordkeeping, notification, labeling and other, similar 
requirements.
    This proposal contains collection of information requirements in 
the following sections: 181.23, 181.31 and 181.43. The following 
particulars apply:
    DOT: 2115.
    OMB CONTROL No.: 2115-XXXX.
    Administration: U.S. Coast Guard
    Title: Expanded Hull Identification Number and New Requirements for 
Certificates of Origin.
    Need for Information: The information collection requirements 
contained in this proposal are necessary to meet statutory requirements 
of 46 U.S.C. chapter 125 regarding the establishment of a national 
vessel identification system for recreational vessel owners.
    Proposed Use of Information: To be used by State agencies, local 
law enforcement, the Coast Guard and other Federal agencies and be 
available, on a fee basis, to private businesses involved in the 
maritime industry (such as banking firms and insurance companies) as a 
centralized data base regarding recreational vessels.
    Burden Estimate: See discussion below.
    Respondents: Boat manufacturers and importers (4,000), individuals 
building their own vessels (17,000) and issuing authorities in States 
and territories of the United States (56).
    Forms: Hull Identification Number and Certificate of Origin
    Average Burden Hours Per Respondent: Variable. There is no 
practical way to estimate the burden per respondent for the Hull 
Identification Number regulations. The respondents are vessel 
manufacturers and importers and State vessel registration and numbering 
authorities and members of the public who build their own vessels. Some 
manufacturers produce thousands of vessels annually, while others may 
produce only a single vessel annually.
    There are approximately 4,000 U.S. manufacturers and importers of 
recreational vessels. They manufacture or import an estimated 2,000,000 
recreational vessels annually.
    Eighty percent are built by major manufacturers. For those 
manufacturers the Coast Guard estimates five minutes per vessel to 
determine the HIN and affix it to the vessel:

.80 x 2,000,000=1,600,000 vessels
5 x 1,600,000=8,000,000 minutes=133,333 hours.

    Twenty percent of the vessels are built by small and often non-
sophisticated manufacturers. For those manufacturers the Coast Guard 
estimates 15 minutes per vessel to determine the HIN and affix it to 
the vessel:

.20 x 2,000,000=400,000 vessels
15 x 400,000=6,000,000 minutes=100,000 hours.

    An estimated 17,000 individuals build their own vessels annually. 
Individuals building their own vessels are assigned an entire Hull 
Identification Number by the State in which they reside. The Coast 
Guard estimates that it takes an individual approximately 15 minutes to 
affix the HIN to a vessel:

17,000 x 15=255,000 minutes=4,250 hours
133,333+100,000+4,250=237,583 hours a total annual burden.

    This total annual burden estimate would vary from year to year 
depending upon the state of the national economy which impacts upon 
annual production figures.
    There is also no practical way to estimate the burden per 
respondent for the proposed COO requirement. The respondents are vessel 
manufacturers and importers and State vessel registration and numbering 
authorities and members of the public who build their own vessels. Most 
manufacturers with a computer will not suffer from significant burdens, 
because the computer can be programmed to generate completed COOs. For 
those manufacturers the Coast Guard estimates 3 minutes per vessel to 
complete a COO:

.80 x 2,000,000=1,600,000 vessels
3 x 1,600,000=4,800,000 minutes=80,000 hours.

    Twenty percent of the vessels are built by small and often non-
sophisticated manufacturers. For those manufacturers the Coast Guard 
estimates 5 minutes per vessel to type the required information 
(security standards would require that the COO be machine prepared):

.20 x 2,000,000=400,000 vessels
5 x 400,000=2,000,000 minutes=33,333 hours.

    Approximately 17,000 individuals build their own vessels annually. 
The States assign Hull Identification Numbers to individuals building 
their own vessels. For individuals the Coast Guard estimates 30 minutes 
per vessel to obtain a COO from the State.

30 x 17,000=510,000=8,500 hours.

    States and territories participating in VIS and assigning Hull 
Identification Numbers would have computers to generate the COO and HIN 
on the basis of information supplied by an individual. The Coast Guard 
estimates 5 minutes for States or territories to enter information 
about a vessel into a computer and generate a COO:

5 x 17,000=85,000=1,416 hours
80,000+33,000+8,500+1,416=122,916 hours total annual burden.

    This annual burden estimate could be substantially higher or lower 
from year to year depending upon the state of the national economy, 
which impacts upon annual production figures.

Federalism

    The Coast Guard has analyzed this proposal in accordance with the 
principles and criteria contained in Executive Order 12612 and has 
determined that this proposal does not have sufficient federalism 
implications to warrant the preparation of a Federalism Assessment. 
These regulations will benefit State boating authorities enforcing 
State titling and registration regulations.
    Title 46 U.S.C. 4302 authorizes the Coast Guard to establish HIN 
regulations. Unless the Secretary provides an exemption, a State may 
not establish, continue in effect, or enforce a law or regulation that 
is not identical to a regulation prescribed under 46 U.S.C. 4302. 
Therefore, the Coast Guard intends to preempt State and local laws and 
regulations which are not identical to the Coast Guard's HIN or COO 
requirements. Title 46 U.S.C. chapter 125 requires the Coast Guard to 
establish VIS requirements. The States' participation in VIS is 
entirely voluntary; however, once a State elects to participate, it 
must comply with the requirements of VIS in order to ensure the 
integrity and uniformity of the system. Therefore, only those States 
meeting all of the VIS requirements will be allowed to participate in 
the VIS system, and the Coast Guard would preempt State and local laws 
prescribing requirements for VIS which are not identical to those the 
Coast Guard prescribes.

Environment

    The Coast Guard considered the environmental impact of this 
proposal and concluded that under section 2.b.2(1) of Commandant 
Instruction M16475.1B, this proposal is categorically excluded from 
further environmental documentation. This proposal governs labeling and 
the issuance of COOs for vessels, and has no environmental 
consequences. A Categorical Exclusion Determination is available in the 
docket for inspection or copying where indicated under ADDRESSES.

List of Subjects in 33 CFR Part 181

    Labeling, Marine safety, Reporting and recordkeeping requirements, 
Incorporation by reference.

    For the reasons set out in the preamble, the Coast Guard proposes 
to amend 33 CFR part 181 as follows:

PART 181--MANUFACTURER REQUIREMENTS

    1. The authority citation for part 181 is revised to read as 
follows:

    Authority: 46 U.S.C. 4302, 12501, 12502; 49 CFR 1.46.

    2. In Sec. 181.3, paragraph (f) is revised to read as follows:


Sec. 181.3  Definitions.

* * * * *
    (f) Certificate of origin means form CG-XXXX.
* * * * *
    3. In Sec. 181.4, paragraph (b) is amended by adding the following 
incorporations by reference in alphabetical order:


Sec. 181.4  Incorporation by reference.

* * * * *
    (b) * * *
American National Standards Institute, Customer Service Sales 
Department, 11 West 42nd Street, New York, NY 10036.

ISO 3166-88 Codes for the representation of names of countries
Sec. 181.25(a)
ISO 1073/I-1976 Alphanumeric character sets for optical recognition--
Part I: Character Set OCR-A--Shapes and dimensions of the printed image
Sec. 181.45(b)
* * * * *
    4. Section 181.25 is revised to read as follows:


Sec. 181.25  Hull identification number format.

    Each of the hull identification numbers required by Sec. 181.23 
must consist of nineteen characters, uninterrupted by slashes, hyphens, 
or spaces, as follows:
    (a) The first two characters must be an alphabetic code from column 
2 of ISO 3166-88 indicating the country of manufacturer identification 
code registration.
    (b) Characters three through five must be a manufacturer 
identification code assigned under Sec. 181.31(a) or the importer 
designation assigned under Sec. 181.31(b).
    (c) Characters six through ten must be a serial number assigned by 
the manufacturer in letters of the English alphabet, or Arabic 
numerals, or both, and may not include the letters, I, O and Q.
    (d) Characters eleven and twelve must indicate the month and year 
of certification when a date of certification is required. In all other 
cases characters eleven and twelve must indicate the date of 
manufacture. The date indicated can be no earlier than the date 
construction or assembly began and no later than the date the vessel 
leaves the place of manufacture or assembly or is imported into the 
United States for the purposes of sale. Character eleven must be 
indicated using letters of the English alphabet. The first month of the 
year, January, must be designated by the letter ``A'', the second 
month, February, by the letter ``B'', and so on until the last month of 
the year, December. Character twelve must be the last digit of the year 
of manufacture or certification and must be an Arabic numeral.
    (e) Characters thirteen and fourteen must indicate the model year 
using Arabic numerals for the last two numbers of the model year such 
as ``94'' for 1994 and ``95'' for 1995.
    (f) The fifteenth character must indicate the overall length of the 
vessel using the corresponding letter of the English alphabet from 
Table 181.25(f).

        Table 181.25(f).--Characters Representing Length of Boat1       
------------------------------------------------------------------------
             Character                              Length              
------------------------------------------------------------------------
A..................................  Less than 6 ft.                    
B..................................  6 ft to 10 ft.                     
C..................................  11 ft.                             
D..................................  12 ft.                             
E..................................  13 ft.                             
F..................................  14 ft.                             
G..................................  15 ft.                             
H..................................  16 ft.                             
J..................................  17 ft.                             
K..................................  18 ft.                             
L..................................  19 ft.                             
M..................................  20 ft.                             
N..................................  21 ft.                             
P..................................  22 ft.                             
R..................................  23 ft.                             
S..................................  24 ft.                             
T..................................  25 ft.                             
U..................................  26 ft.                             
V..................................  27 ft.                             
W..................................  28 ft.                             
X..................................  29 ft.                             
Y..................................  30 ft.                             
Z..................................  31 ft or more.                     
------------------------------------------------------------------------
1Inches are not included in the measurement of length, e.g., 15 ft 10 in
  is 15 ft and 16 ft 3 in is 16 ft.                                     

    (g) The sixteenth character must indicate the hull material of the 
vessel using the corresponding Arabic numeral from Table 181.25(g).

    Table 181.25(g).--Characters Representing Hull Material of Vessel   
------------------------------------------------------------------------
             Character                          Hull material           
------------------------------------------------------------------------
1..................................  Aluminum.                          
2..................................  Ferrocement.\1\                    
3..................................  Fiber Reinforced Plastic.          
4..................................  Flexible Fabric.\2\                
5..................................  Foam.                              
6..................................  Plastic.\3\                        
7..................................  Steel.                             
8..................................  Wood.                              
------------------------------------------------------------------------
\1\Ferrocement includes all types of concrete and portland cement.      
\2\Flexible fabric can be distinguished from plastic sheet by the       
  absence of any woven material.                                        
\3\Plastic includes flexible plastic sheet, rigid sheet which has been  
  thermoformed, and rotational molded plastic.                          

    (h) The seventeenth character must indicate the principal means of 
propulsion of the vessel using the corresponding Arabic numeral from 
Table 181.25(h).

 Table 181.25(h).--Characters Representing Principal Means of Propulsion
------------------------------------------------------------------------
             Character                       Principal propulsion       
------------------------------------------------------------------------
1..................................  Air Propeller.                     
2..................................  Bracket mounted outboard.          
3..................................  Inboard.                           
4..................................  Inboard jet.                       
5..................................  Inboard/Outdrive.                  
6..................................  Non-powered.\1\                    
7..................................  Outboard.                          
8..................................  Sail.\2\                           
9..................................  Sail w/Inboard Auxiliary.          
------------------------------------------------------------------------
\1\Non-powered includes pedals, paddles and oars, but not sails.        
\2\Sail includes sailboats which may have a small outboard engine for   
  auxiliary power.                                                      

    (i) The eighteenth character must indicate the type of vessel using 
the corresponding Arabic numeral from Table 181.25(i).

         Table 181.25(i).--Characters Representing Type of Boat         
------------------------------------------------------------------------
   Character                              Type                          
------------------------------------------------------------------------
1.............  Air Cushion Vehicle.\1\                                 
2.............  Canoe, Kayak, Sailboard, Surfboard.                     
3.............  Inflatable.\1\                                          
4.............  Monohull/Cabin Configuration.\2\                        
5.............  Monohull/Closed Bow.\3\                                 
6.............  Monohull/Open Bow.\4\                                   
7.............  Multihull/Cabin or closed Bow.2,3,5                     
8.............  Multihull/Open Deck.4,5                                 
9.............  Personal Watercraft.\6\                                 
------------------------------------------------------------------------
\1\Air Cushion Vehicle is sometimes called a hovercraft, which is a     
  registered trademark.                                                 
\2\Cabin configuration includes full cabin, cuddy cabin, houseboat, and 
  in general any shelter containing berths, or other accommodations for 
  personnel.                                                            
\3\Closed bow is most commonly called a runabout and includes any type  
  of forward deck which is not a shelter for personnel.                 
\4\Open bow or Open Deck includes utility boats, open deck bass boats,  
  and most center console vessels.                                      
\5\Multihull includes any watercraft where there are distinct hulls     
  connected by a common deck such as trihulls, catamarans and pontoon   
  boats.                                                                
\6\Personal watercraft comprise a wide variety of craft on which the    
  operator and/or passengers ride, rather than occupy a passenger       
  carrying area inside the hull.                                        


    (j) The nineteenth character must be a check digit calculated as 
follows:
    (1) On line A of Figure 181.25(j) enter the first eighteen 
characters of the HIN.
    (2) On line B enter the value of each character in the HIN.
    (3) Multiply each number in line B by its corresponding number in 
line C for each of the eighteen digits and enter the product of each of 
these separate computations in the appropriate spaces in line D.
    (4) Add all the numbers recorded in line D together.
    (5) Divide the final sum by the number, 10. The remainder of this 
division is the check digit, the nineteenth character in the HIN. If 
the remainder is zero, the nineteenth character is 0.

BILLING CODE 4910-14-C

TP06MY94.000


BILLING CODE 4910-14-C
    5. In Sec. 181.31, paragraph (c) is revised to read as follows:


Sec. 181.31  Manufacturer identification code assignment.

* * * * *
    (c) Each person required to identify a vessel under Sec. 181.23(b) 
must obtain a hull identification number from the issuing authority of 
the State where the vessel will be principally used, or, if the States 
does not assign these numbers, from the Coast Guard District office in 
the area of principal use.
* * * * *
    6. A new subpart D is added to read as follows:

Subpart D--Certificates of Origin for Boats

Sec.
181.41  Purpose and applicability.
181.43  Certificate of Origin required.
181.45  Required information for Certificate of Origin.
181.47  Duplicate Certificate of Origin form.
181.49  Source for Certificate of Origin form.
181.51  Alteration of Certificate of Origin.
181.53  Fraudulent use of Certificate of Origin.
181.55  Unauthorized name or address change.

Subpart D--Certificates of Origin for Boats


Sec. 181.41  Purpose and applicability.

    This subpart prescribes requirements for the issuance of 
Certificates of Origin (CG-XXXX) to vessels to which this part applies.


Sec. 181.43  Certificate of Origin required.

    (a) A manufacturer (or importer) as defined in Sec. 181.3 of this 
part, shall furnish with each new recreational vessel that is sold or 
offered for sale, a Certificate of Origin (CG-XXXX) containing the 
information required by this subpart.
    (b) No person shall sell or offer for sale a new recreational 
vessel unless a Certificate of Origin (CG-XXXX) meeting the 
requirements of this subpart is furnished with the recreational vessel.


Sec. 181.45  Required information for Certificate of Origin.

    A Certificate of Origin (CG-XXXX) furnished with a recreational 
vessel in accordance with Sec. 181.43 must--
    (a) Be signed by or on behalf of the vessel manufacturer; and
    (b) Recite the following:
    (1) The vessel's 19 character hull identification number assigned 
in accordance with Sec. 181.25.
    (2) The date the Certificate of Origin is issued.
    (3) The model name or numerical designation for the vessel.
    (4) The length of the vessel in feet and inches.
    (5) The beam of the vessel in feet and inches.
    (6) Whether the vessel is for commercial or recreational use.
    (7) The name and address of the dealer or individual to whom the 
vessel is first transferred.
    (8) The place the vessel is constructed (plant location).


Sec. 181.47  Duplicate Certificate of Origin form.

    A duplicate Certificate of Origin form (CG-XXXX) issued by a boat 
manufacturer or importer that is used as a replacement for an original 
CG-XXXX, must:
    (a) Incorporate the same security features as the original CG-XXXX;
    (b) Recite the same information as the original CG-XXXX required in 
Sec. 181.45, except for the date of issuance; and
    (c) State clearly on the face of the document that it is a 
``Duplicate.''


Sec. 181.49  Source for Certificate of Origin form.

    A manufacturer (or importer) as defined in Sec. 181.3 of this part, 
must obtain Certificate of Origin forms (CG-XXXX) from: [Address to be 
inserted in final rule].


Sec. 181.51  Alteration of Certificate of Origin.

    No person shall intentionally alter a Certificate of Origin (CG-
XXXX).


Sec. 181.53  Fraudulent use of Certificate of Origin.

    No person shall knowingly use a Certificate of Origin (CG-XXXX) in 
a fraudulent manner.


Sec. 181.55  Unauthorized name or address change.

    No manufacturer or importer who issues Certificates of Origin (CG-
XXXX) in accordance with this subpart shall change the company name or 
address without notifying the U.S. Coast Guard Recreational Boating 
Product Assurance Branch, 2100 Second Street SW., Washington, DC 20593-
0001 in writing.

    Dated: April 28, 1994.
W.J. Ecker,
Rear Admiral, U.S. Coast Guard, Chief, Office of Navigation Safety and 
Waterway Services.
BILLING CODE 4910-14-M

Appendix A to This Document Sample Forms

TP06MY94.001


TP06MY94.002


[FR Doc. 94-10853 Filed 5-5-94; 8:45 am]
BILLING CODE 4910-14-C