[Federal Register Volume 61, Number 221 (Thursday, November 14, 1996)]
[Proposed Rules]
[Pages 58359-58360]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-29196]


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DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Part 187

46 CFR Part 67

[CGD 96-060]


Vessel Documentation: Combined Builder's Certification and 
Manufacturer's Certificate of Origin, Submission of Hull Identification 
Number (HIN) for Documentation of Recreational Vessels, and Issuance of 
Temporary Certificates of Documentation

AGENCY: Coast Guard, DOT.

ACTION: Notice of request for comments.

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SUMMARY: The Coast Guard seeks information that may be useful in 
determining the benefits for the following: Combining the Builder's 
Certification and Manufacturer's Certificate of Origin; proposing to 
require submission of the Hull Identification Number for documentation 
of recreational vessels; and issuing temporary Certificates of 
Documentation. This information will be useful in evaluating 
alternative approaches, especially where these proposals will assist in 
law enforcement, preventing fraud, and increasing customer 
satisfaction.

DATES: Comments must be received on or before January 13, 1997.

ADDRESSES: Comments may be mailed to the Executive Secretary, Marine 
Safety Council (G-LRA/3406) (CGD 96-060), U.S. Coast Guard 
Headquarters, 2100 Second Street SW, Washington, DC 20593-0001, or may 
be delivered to room 3406 at the same address between 9:30 a.m. and 2 
p.m., Monday through Friday, except Federal holidays. The telephone 
number is (202) 267-1477.
    The Executive Secretary maintains the public docket for this notice 
of request for comments. Comments will become part of this docket and 
will be available for inspection or copying at room 3406, U.S. Coast 
Guard Headquarters, between 9:30 a.m., and 2 p.m., Monday through 
Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT:
LTJG Michael Antonellis, National Maritime Center, U.S. Coast Guard, 
4200 Wilson Blvd., Suite 510, Arlington, VA 22203-1804, telephone (703) 
235-8447.

SUPPLEMENTARY INFORMATION:

Request for Comments

    The Coast Guard encourages interested persons to participate in 
this request by submitting written data, views, or arguments. Persons 
submitting comments should include their names and addresses, identify 
this inquiry (CGC 96-060) and the specific section of this document to 
which each comment or question applies, and give the reason for each 
comment. Please submit two copies of all comments and attachments in an 
unbound format, no larger than 8\1/2\ by 11 inches, suitable for 
copying and electronic filing. Persons wanting acknowledgment of 
receipt of comments should enclose stamped self-addressed postcards or 
envelopes. The Coast Guard will consider all comments received during 
the comment period.

Background and Purpose

    In recent years, the Coast Guard has received numerous inquiries 
from its customers concerning various alternatives to help reduce the 
opportunity for fraud, to facilitate the documentation process and to 
allow vessel owners to operate while waiting for issuance of the 
permanent Certificate of Documentation (COD). The Coast Guard is 
considering the following three ideas to address some of the concerns: 
(1) Combining the Builder's Certification and the Manufacturer's 
Certification of Origin; (2) publishing a notice of proposed rulemaking 
to require submission of the Hull Identification Number (HIN) for 
Documentation of Recreational Vessels; and (3) issuing temporary CODs.

Discussion

    The Coast Guard seeks information that may be useful when it 
considers how to revise and/or implement procedures pertaining to the 
documentation of vessels. This information will be useful in evaluating 
alternative approaches to help deter fraud, increase the ability to 
track vessels for enforcement purposes, and improve customer 
satisfaction by allowing vessel owners to operate while waiting for 
issuance of the permanent COD. Any rulemaking that results from this 
notice would be considered part of the Coast Guard's ongoing review of 
its existing regulations under Section 610 of the Regulatory 
Flexibility Act of 1980 (5 U.S.C. 610)
    The first idea for public comment is, combining the Builder's 
Certification (Form CG-1261) and the Manufacturer's Certificate of 
Origin (MCO) will reduce the opportunity for fraud. Form CG-1261 is 
required to provide build and title evidence for documentation. The MCO 
is required to title a vessel in a State. Each form collects slightly 
different information. Currently, most manufacturers will issue both 
forms for each vessel built, thus giving the purchaser the opportunity 
to either

[[Page 58360]]

obtain documentation or obtain a State title for the vessel.
    Certain vessel owners have used the MCO to obtain a State title and 
Form CG-1261 to obtain a permanent COD. These vessel owners have then 
recorded one vessel loan as a lien against the State title, and 
obtained a second loan which is recorded at the National Vessel 
Documentation Center (NVDC). The financial institutions making the 
loans are unaware of the dual registration. In other cases, 
unscrupulous owners sell the vessel to different people, using the 
State title for one transfer and the permanent COD for the other.
    Because the States collect more information than the Coast Guard 
needs there could be a slight increase in the Coast Guard's information 
collection budget. The benefits of combining the forms may be found to 
outweigh this factor, and by helping to prevent fraud, there may be a 
greater willingness for banks to make vessel loans.
    In the past, the Coast Guard has been reluctant to combine the two 
forms. However, a combined form could be made a requirement for an 
approved State titling system which would allow creation of preferred 
mortgages on State titled vessels.
    The second idea, requiring submission of the HIN for documentation 
of recreational vessels, could facilitate the tracking of vessels for 
law enforcement purposes. The HINs are required for recreational 
vessels under the provisions of 33 CFR part 181. The original purpose 
of the HIN was to provide a mechanism for vessel recall if a safety 
defect was discovered. In recent years, the use of the HIN has been 
expanded so that it now is a primary means of tracking vessels for law 
enforcement purposes.
    Even though every vessel manufactured for recreational purposes 
after a certain date is required to have a HIN, vessel documentation 
customers have never been required to provide the HIN to the Coast 
Guard as a part of the documentation process. Requiring submission of 
the HIN, under the authority of 46 U.S.C. 12103(d), could help to deter 
fraud and prevent vessels from being documented more than once.
    The third idea is for the Coast Guard to issue temporary CODs. In 
recent years, our customers have required that the Coast Guard issue 
temporary CODs so that owners of pleasure boats could use them while 
waiting for issuance of the permanent CODs. The Coast Guard has refused 
citing the absence of direct statutory authority to issue temporary 
CODs. In the past, proponents for temporary CODs cited 46 U.S.C. 
12102(b) as authority for temporary documents. The Coast Guard is 
prepared to reconsider its statutory authority if there is sufficient 
interest and a practical solution to the issue.
    For example, a temporary COD could be a form filled out by the 
applicant and mailed with the rest of the paperwork. That form could be 
validated by a seal or other means and mailed back immediately. In the 
long-term, the Coast Guard might seek to have qualified persons issue 
the temporary CODs in a manner similar to the way in which car dealers 
act for the State in issuing temporary license plates. The temporary 
CODs could be valid for 60 or 90 days, or until revoked by the Coast 
Guard. The United States is one of the very few nations which does not 
issue any kind of temporary CODs. The minimal coasts associated with 
this service might be recovered through user fees.

    Dated: November 6, 1996.
J.C. Card,
Rear Admiral, U.S. Coast Guard Chief, Marine Safety and Environmental 
Protection.
[FR Doc. 96-29196 Filed 11-13-96; 8:45 am]
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