[Federal Register Volume 61, Number 250 (Friday, December 27, 1996)]
[Proposed Rules]
[Pages 68202-68208]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32891]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 678

[Docket No. 961211348-6348-01; I.D. 121196A]
RIN 0648-AH77


Atlantic Shark Fisheries; Limited Access Program

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Proposed rule; request for comments.

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SUMMARY: NMFS proposes to implement the limited access system contained 
in proposed Amendment 1 to the Fishery Management Plan for Atlantic 
sharks (FMP). If approved, Amendment 1 would establish a two-tiered 
permit system for the Atlantic shark commercial fishery, set forth 
eligibility criteria for these permits based on historical 
participation, and limit the transferability of such permits. NMFS has 
determined that the Atlantic shark fishery is overfished and 
overcapitalized, with an excessive number of permitted vessels relative 
to the harvest level prescribed by the recovery plan. NMFS is holding 
public hearings and requesting written comments from the public on this 
proposed rule. The objective of this amendment is to take a first and 
significant step to prevent further overcapitalization.

DATES: Written comments on this proposed rule must be received on or 
before February 18, 1997.

ADDRESSES: Comments on this proposed rule should be sent to William 
Hogarth, Acting Chief, Highly Migratory Species Management Division (F/
SF1), National Marine Fisheries Service, 1315 East-West Highway, Silver 
Spring, MD 20910. Copies of Amendment 1, which includes an 
Environmental Assessment (EA) and Regulatory Impact Review (RIR), are 
available from Margo Schulze, Fishery Biologist, at the same address. 
See SUPPLEMENTARY INFORMATION for hearing locations. Comments regarding 
the collection-of-information requirement required in this rule should 
be sent to Margo Schulze and to the Office of Information and 
Regulatory Affairs, Office of Management and Budget (OMB), Washington, 
DC 20503 (Attention: NOAA Desk Officer).

FOR FURTHER INFORMATION CONTACT: Margo Schulze or John Kelly, 301-713-
2347; fax: 301-713-1917.

SUPPLEMENTARY INFORMATION:

Background

    The fishery for Atlantic sharks is managed under the FMP prepared 
by NMFS under authority of section 304(g) of the Magnuson-Stevens 
Fishery Conservation and Management Act (Magnuson-Stevens Act), as 
amended, and implemented on April 26, 1993, through regulations found 
at 50 CFR part 678. The FMP established three species management 
groups, commercial quotas and recreational bag limits, fishing seasons, 
mandatory vessel reporting, and required commercial vessel permits 
(with an earned income requirement). The Atlantic shark fishery has 
operated under open access.
    On February 22, 1994, a notice of control date for entry into the 
Atlantic shark fishery was published in the Federal Register (59 FR 
8457). This notice announced that anyone entering the fishery after 
that date (the ``control date'') may not be assured of future access to 
the fishery if some form of limited access were implemented later.
    Currently, there are more vessels permitted in the fishery than are 
necessary or desirable to harvest the available total allowable catch 
(TAC). During 1993-96, the number of commercial vessels permitted in 
the fishery has fluctuated between approximately 1,500 and 2,748 
vessels, while the TAC has been harvested by about 100 to 150 vessels 
(approximately 3 to 5 percent of the permitted fleet).

Need for Limited Access

    The creation of a limited access system would be an initial step 
toward achieving a more reasonable balance between the harvesting 
capacity of the permitted fleet and the TAC. Implementation of proposed 
limited access would, at a minimum, prevent further increases in the 
number of permits in the fisheries that target sharks and would 
dramatically reduce the number of speculative permit holders (those 
without significant, documented landings of Atlantic sharks).
    While a limited access system alone would not resolve all of the 
problems associated with open access fisheries (e.g., derby fishing 
conditions, ``the race for fish,'' market gluts), it would help prevent 
them from becoming more severe. Additionally, considerable public 
comment subsequent to the scoping meetings convened by NMFS indicates 
increased support for limited access from the directed shark fishing 
industry.
    A limited access system would stabilize fleet size and provide an 
opportunity for NMFS to collect data, conduct studies, and work 
cooperatively with fishery participants and other constituents to 
develop a more flexible, permanent, effort control program in the 
future.

Permit Categories

    NMFS proposes to implement a two-tiered commercial fishing permit 
system in which permits would be classified as ``directed'' or 
``incidental.'' The reason for issuing two types of permits is to 
define and regulate the directed shark fishery separately from 
commercial fisheries that target other species but take sharks as 
bycatch. Only persons holding directed fishery permits would be 
eligible to participate in directed fisheries under the management 
measures already established, while those holding incidental permits 
would be restricted to the bycatch fishery with more restrictive 
management measures. NMFS proposes to restrict access to both the 
directed and incidental shark fisheries.

Eligibility Criteria

    Only person or entities that held a shark permit at any time from 
July 1, 1994, through December 31, 1995, who have documented landings 
equal to or above the specified directed or incidental threshold levels 
of historical participation in the shark fishery, who meet the current 
earned income requirement, and who own a shark-permitted vessel at the 
time of

[[Page 68203]]

publication of the final rule would receive a directed or incidental 
commercial permit, respectively.
    It is considered that catch histories belong to current permit 
holders rather than to vessels; i.e., if a shark permit holder sells 
one vessel and buys another, he/she retains the history of the vessel 
sold and does not acquire the history of the vessel purchased. Thus, it 
is considered that persons or entities purchasing existing shark 
vessels have not also purchased that vessel's catch history (since the 
fishery is currently open access, it would be imprudent for someone to 
pay money for a catch history from which he/she may never benefit). 
However, the establishment of a control date by NMFS has changed this 
assumption as several vessels were purchased after the control date 
with stipulations that the catch history of the purchased vessel was 
purchased as well. Accordingly, NMFS will accept legal documentation of 
transfers of catch histories in the determination of eligibility.
    These eligibility criteria are proposed because the majority of 
existing shark permit holders have not participated in the fishery 
(have not had significant reported landings of sharks). If all current 
shark permit holders were to be allowed future participation in the 
commercial shark fishery, there would be potential to reach or even to 
exceed greatly the TAC in a short time. Given the overfished status of 
large coastals and the fully fished status of pelagics and small 
coastals, exceeding the TAC could have substantial long-term negative 
impacts on these resources.
    For the directed fishery, NMFS proposes a minimum landings 
threshold of 250 sharks from January 1, 1991, through February 21, 
1994, and 125 sharks from February 22, 1994 (the control date), through 
June 30, 1995 (which is equivalent to having landed sufficient shark 
each year on average to earn $5,000 per year in gross revenue). NMFS 
estimates that 134 vessels would be eligible for directed shark permits 
under this landings criteria.
    For the incidental fishery, NMFS proposes a minimum landings 
threshold of three sharks from January 1, 1991, through February 21, 
1994, and two sharks from February 22, 1994 (the control date), through 
June 30, 1995. NMFS estimates that 279 vessels would be eligible for 
incidental shark permits under this landings criteria.
    If a vessel were sold after the control date and its landings 
history were included specifically in the written sales agreement, such 
landings would accrue to the purchaser (and no longer to the seller) 
for purposes of qualifying for a directed or incidental permit under 
the proposed limited access system.

Permit Process

    NMFS would identify and notify all permit holders of their 
eligibility status for the directed or incidental shark fishery, after 
analysis based on the established eligibility criteria.
    Upon receipt of this initial notification, eligible permit holders 
may submit an application for a directed or incidental fishery permit. 
If a permit holder is informed that he or she does not qualify for a 
permit, but he or she believes that there is credible evidence to the 
contrary, the permit holder may apply for a permit and provide the 
appropriate documentation. NMFS would then evaluate all applications 
and any accompanying documentation, and notify the applicant of its 
decision either to accept or deny the permit application.
    If the permit application is denied, the applicant may appeal 
within 90 days of receipt of the notice of denial. Provisional directed 
or incidental fishery permits, as appropriate, would be issued, pending 
the outcome of an appeal, until the final decision has been rendered. 
All appeal decision letters would be mailed via certified mail. If the 
appeal is denied, provisional permits would become invalid 5 days after 
the receipt of the notice of denial. If the appeal is approved, 
provisional permits would become invalid upon receipt of the 
appropriate permit.
    Only owners or operators of permitted vessels that were permitted 
at any time from July 1, 1994, through December 31, 1995, would be 
considered for appeal. All appeals would need to be made in writing. To 
appeal, the applicant would complete an appeal cover sheet with the 
name, affiliation (if any), address, and telephone number of the 
applicant. Additional pages and documentation could be attached, as 
necessary.
    The sole ground for appeal would be that NMFS used incorrect or 
incomplete data in the eligibility analysis. No hardship cases would be 
heard. Valid documentation of landings covering the eligibility period 
would be required for consideration of an appeal. Documentation that 
would be considered in support of an appeal from fishers who believe 
they qualify for a directed or incidental fishery permit would be 
restricted to official NMFS logbook records that have been submitted to 
NMFS prior to August 30, 1995 (60 days after the cutoff date for 
eligible landings); official, verifiable sales slips or receipts from 
registered dealers; and state landings records. Dealer sales slips or 
receipts would have to show definitively the species and the vessel's 
name or other traceable indication of the harvesting vessel. Dealer 
records would have to contain a sworn affidavit by the dealer 
confirming the accuracy and authenticity of the records.
    While photocopies would be acceptable for initial submission, NMFS 
might request originals at a later date, which would be returned to the 
applicant via certified mail. Any submitted materials of questionable 
authenticity would be referred for investigation to NMFS' Office of 
Enforcement.
    NMFS would designate appeals officers, who would be NOAA employees. 
The appeals officers would individually review cases but would confer 
regularly to ensure consistency.
    The appeals officers would review appeals for no more than 30 days 
before making a recommendation to the Director of the Office of 
Sustainable Fisheries (Director). The Director would render the final 
decision for the Department of Commerce. All denial letters would be 
sent by certified mail with return receipt so that NMFS would know when 
letters were received by permit holders.

Restrictions on Transfer of Permits

    NMFS recognizes that vessels may sink or deteriorate beyond repair, 
and vessel owners may have valid reasons for wishing to exit the 
fishery. NMFS proposes to create a system in which directed commercial 
permits would be transferable with the sale of the permitted vessel, or 
to a vessel of similar harvesting capacity, or a replacement vessel 
owned or purchased by the original permittee but not under any other 
circumstances. Such transfers would be subject to upgrading 
restrictions (defined in next section). Incidental permits would not be 
transferable. NMFS recognizes that the same factors present in the 
directed fishery (e.g., vessel sinking or deterioration, disability, 
retirement) would also be present in the incidental fishery and that 
non-transferability of incidental permits would eventually result in 
the elimination of the incidental fishery through attrition. However, 
NMFS believes that allowing transferability of incidental permits could 
result in substantial increases in fishing effort levels. Prohibiting 
transferability of incidental permits would slow the growth of fishing 
effort in the limited access fishery.
    In years after 1997, the eligibility criteria to which initial 
limited access permit holders are subject would not apply. In other 
words, transferees/

[[Page 68204]]

buyers of limited access vessel permits would not be required to meet 
the initial limited access eligibility criteria, (i.e., having held a 
shark permit at any time from July 1, 1994, through December 31, 1995; 
having met the landings thresholds and the earned income requirement; 
and owning a vessel at the time of publication of the final rule).

Restrictions on Vessel Upgrading

    NMFS proposes to require that any vessel to which a permit is 
transferred be defined as the ``new'' vessel and be required to have 
the same or less gross registered tonnage and registered length as the 
originally permitted vessel. This restriction would apply to 
``replacement vessels,'' or those vessels acquired by the original 
permittee to replace originally permitted vessels, and to ``new 
vessels,'' or those vessels not originally permitted but to which a 
permit has been transferred after the original permittee has sold the 
permit. This restriction would also apply to the refurbishment of 
existing permitted vessels.

Ownership Limits

    NMFS proposes to restrict the number of permitted vessels that any 
one person or entity could own or control to no more than 5 percent of 
the permitted vessels in the directed fishery. This would prevent 
significant consolidation and maintain the historically predominant 
individual owner/operator character of the shark fishery.

Incidental Harvest Limits

    Without limits on the harvest of bycatch, the potential would exist 
for the incidental fishery to target and harvest significant numbers of 
sharks. This would defeat the purpose of the two-tiered commercial 
permit system. For these reasons, NMFS proposes to establish a harvest 
limit for the incidental fishery at a maximum of four sharks (all 
species combined) per vessel per day. Vessel logbooks would be examined 
to determine the dates of trip origin and termination (number of days) 
to ascertain the authorized harvest limit for each trip, with the 
number of days of the trip multiplied by 4 as the maximum number of 
sharks of all species authorized per trip.
    NMFS believes that establishing a limit of four shark per vessel 
per day for the commercial incidental fishery would ensure that fishing 
mortality on the overfished large coastal stock does not increase, 
while still providing the opportunity for incidental fishers to land 
some bycatch. The rationale for combining all species groups is that a 
single catch limit would minimize fishing mortality on the overfished 
large coastal sharks, prevent increases in fishing mortality on the 
fully fished pelagic and small coastal sharks, reduce the incentive to 
target sharks while fishing for other species, and greatly facilitate 
enforcement. A limit of four sharks per vessel per day limit for the 
incidental limit would be restrictive for the pelagic longline 
fisheries, which often catch substantial numbers of pelagic sharks as 
bycatch. However, at this time, most pelagic sharks are released except 
for makos and threshers, which are harvested for their valuable fins, 
and porbeagles, for which there is a small directed fishery. Current 
estimates of effective fishing mortality on pelagic sharks indicate 
that significant increases in fishing mortality would likely result in 
overfishing. The proposed incidental limit, in conjunction with the 
limited number of permits that would be issued for the incidental 
category under the proposed limited access system (approximately 279 
permits), would allow some sharks caught as bycatch to be landed, while 
an increase in the current level of fishing mortality would be 
prevented.

Fees

    The Regional Director may charge a fee to recover the 
administrative expenses of permit issuance and appeals. The amount of 
the fee would be determined, at least annually, in accordance with the 
procedures of the NOAA Finance Handbook, available from the Regional 
Director, for determining administrative costs of each special product 
or service. The fee would not exceed such costs and would be specified 
with each application form. The appropriate fee would be required to 
accompany each application. Failure to pay the fee would preclude 
issuance of the permit. Payment by a commercial instrument later 
determined to be insufficiently funded would invalidate any permit.

Classification

    This proposed rule is published under the authority of the 
Magnuson-Stevens Act, 16 U.S.C. 1801 et seq. The Assistant 
Administrator has preliminarily determined that the proposed 
regulations are necessary for management of the Atlantic shark fishery. 
NMFS prepared a draft EA for this proposed rule with a preliminary 
finding of no significant impact on the human environment. NMFS 
reinitiated consultation on the Atlantic shark fishery under section 7 
of the Endangered Species Act on September 25, 1996. This consultation 
will consider new information concerning the status of the northern 
right whale. NMFS has determined that proceeding with this rule, 
pending completion of that consultation, will not result in any 
irreversible and irretrievable commitment of resources that would have 
the effect of foreclosing the formulation or implementation of any 
reasonable and prudent alternative measures. This rule would reduce the 
number of permits in the Atlantic shark commercial fishery and freeze 
the harvesting capacity of the fleet at current levels, thereby 
preventing further overcapitalization and derby fishing conditions and 
would likely reduce interaction rates.
    The Assistant General Counsel for Legislation and Regulations of 
the Department of Commerce certified to the Chief Counsel for Advocacy 
of the Small Business Administration that this proposed rule, if 
adopted, would not have a significant economic impact on a substantial 
number of small entities as follows:

    The proposed rule would establish a two-tiered limited access 
permit system for the Atlantic shark fishery, set forth eligibility 
criteria for these permits based on historical participation, and 
limit the transferability of such permits. The Atlantic shark 
fishery is overfished and overcapitalized, with an excessive number 
of permitted vessels relative to the harvest level prescribed by the 
recovery plan.
    The purpose of this proposed rule is to rationalize current 
harvesting capacity with total allowable catch and substantially 
reduce latent effort without significantly altering the status quo 
in the Atlantic shark fishery. Practically all current participants 
of the shark fishery readily fall within the definition of small 
business. The proposed rule will affect all current permit holders 
in the Atlantic shark fishery. However, few if any shark fishers 
that are substantially dependent on the fishery would be excluded 
under the proposed limited access rule.
    Speculative permit holders, by definition, have not participated 
in the commercial shark fishery at all or have not been 
substantially dependent on the fishery. The incidental bycatch 
limits continue to provide for speculative commercial fishers to 
land some sharks; accordingly, annual gross revenues should not 
decrease substantially.
    Therefore, redefining commercial shark permits as directed and 
incidental will not significantly alter the status quo of the 
Atlantic shark fishery in terms of fishers' annual gross revenues. 
Since the proposed rule will not significantly impact presently 
active shark fishers, the ``significant economic impact'' criterion 
will not be met. Therefore, the substantive changes proposed are 
minimal, primarily affecting the applicability of permitting 
requirements.
    Any of the proposed limited entry measures have implications on 
the gross revenues of small entities. In essence, those that will be 
excluded from any form of limited entry system will experience

[[Page 68205]]

reduction in their gross revenues at least in the short run. If 
qualification for any form of limited entry is similar to the one 
adopted for the species endorsement and bycatch while limited is 
allowed, those excluded would probably not experience more than a 5 
percent reduction in their gross revenues.
    The substantive changes proposed primarily affecting the 
applicability of permitting requirements. The need for these changes 
is explained in the preamble to the proposed rule.

Notwithstanding any other provision of law, no person is required to 
respond to, nor shall a person be subject to a penalty for failure to 
comply with, a collection-of-information subject to the requirements of 
the Paperwork Reduction Act (PRA) unless that collection of information 
displays a currently valid OMB Control Number.
    This proposed rule does not change any currently approved vessel 
permitting or reporting requirements under OMB Control Numbers 0648-
0205, which is estimated and approved at 20 minutes per permit 
application, and 0648-0016, which is estimated and approved at 15 
minutes per logbook report. However, the appeals procedure does 
constitute a new collection-of-information requirement, which has been 
submitted to OMB for approval. An appeal of a permit denial is 
estimated to take 1.5 hours, including the time to gather records, make 
copies, and mail documents to NMFS. Comments regarding: (1) the 
accuracy of this burden estimate (including hours and cost); (2) 
whether the proposed collection of information is necessary for the 
proper performance of NMFS' functions, including whether the sought 
information has practical utility; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; (4) ways to 
minimize the burden of the collection of information on respondents, 
including through the use of automated collection techniques or other 
forms of information; and (5) any other aspects of information 
collection should be sent to OMB and NMFS (see ADDRESSES).
    This action has been determined to be not significant for purposes 
of E.O. 12866.

List of Subjects in 50 CFR Part 678

    Fisheries, Fishing, Reporting and recordkeeping requirements.

    Dated: December 20, 1996.
Nancy Foster,
Deputy Assistant Administrator, National Marine Fisheries Service.

    For the reasons set out in the preamble, 50 CFR part 678 is 
proposed to be amended as follows:

PART 678--ATLANTIC SHARKS

    1. The authority citation for part 678 continues to read as 
follows:

    Authority: 16 U.S.C. 1801 et seq.

    2. In Sec. 678.2, a definition for ``Director'' is added, in 
alphabetical order, to read as follows:


Sec. 678.2  Definitions.

* * * * *
    Director means the Director, Office of Sustainable Fisheries F/SF, 
NMFS, or a designee.
* * * * *
    3. In Sec. 678.4, paragraphs (a) through (c) and (e) through (k) 
are revised to read as follows:


Sec. 678.4  Permits and fees.

    (a) Vessel permits. Any owner or operator of a vessel of the United 
States that fishes for, possesses, or lands Atlantic sharks from the 
management unit, except vessels that fish for Atlantic sharks 
exclusively in state waters, and recreational fishing vessels, must 
obtain and carry on board a valid Federal shark permit issued under 
this paragraph.
    (1) Limited access eligibility in 1997. NMFS will issue two types 
of Atlantic shark vessel permits: Directed and incidental. To be 
eligible to obtain a shark permit for 1997, a vessel owner or operator 
must have held a valid Federal commercial shark permit at any time from 
July 1, 1994, through December 31, 1995, must meet the earned income 
qualification specified in paragraph (b)(1)(vi) of this section, and 
must own or operate a vessel with a valid shark permit on the date of 
publication of the final rule.
    (i)(A) Directed permits will be issued only to eligible permit 
holders that have documented landings of at least 250 sharks from 
January 1, 1991, through February 21, 1994, and 125 sharks from 
February 22, 1994, through June 30, 1995.
    (B) Incidental permits will be issued only to eligible permit 
holders that have documented landings of three sharks from January 1, 
1991, through February 21, 1994, and two sharks from February 22, 1994, 
thorough June 30, 1995.
    (ii) If the vessel owner does not meet the limited access criteria 
specified in paragraph (a)(1) of this section and the earned income 
qualification specified in paragraph (b)(1)(vi) of this section and the 
operator does meet those qualifications, the operator may apply for a 
shark permit.
    (iii) A shark permit for 1997 will not be issued unless an 
application for such permit is received by NMFS on or before December 
31, 1997.
    (2) Eligibility in 1998 and thereafter. To be eligible for a shark 
permit in years after 1997, a vessel owner or operator must have been 
issued a shark permit for the preceding year or the vessel must be 
replacing a vessel that has been retired from the Atlantic commercial 
shark fishery and had been issued a shark permit for the preceding 
year, and the vessel and owner must meet the criteria set forth in 
paragraphs (a)(4) through (a)(6) of this section. If more than one 
vessel owner claims eligibility to apply for a shark permit based on 
one vessel's fishing and permit history after 1997, the Regional 
Administrator shall determine who qualifies for the limited access 
Atlantic shark vessel permit according to paragraph (a)(3) of this 
section.
    (3) Change in ownership. The fishing and permit history of a vessel 
is presumed to be retained by the original permit holder whenever the 
vessel is bought, sold, or otherwise transferred, unless there is a 
written agreement, signed by the transferor/seller and transferee/
buyer, or other credible written evidence, verifying that the 
transferor/seller is transferring/selling the vessel's fishing and 
permit history.
    (4) Permit transfer. Directed permits are transferable to a new 
vessel and/or owner or to a replacement vessel owned or purchased by 
the original permittee but not under any other circumstances. Such 
transfers are subject to the requirements specified in paragraph (a)(5) 
of this section. Incidental permits are not transferable or assignable; 
incidental permits are valid only for the vessel and owner or operator 
of original issuance.
    (5) Vessel replacement/upgrading. Transfer of directed shark 
permits is authorized only for new or replacement vessels of the same 
or lesser gross registered tonnage and registered length as the 
originally permitted vessel.
    (6) Ownership limits. One person or entity may own or control no 
more than 5 percent of the vessels in the directed shark fishery.
    (7) Notification of eligibility for 1997. (i) NMFS will attempt to 
notify all current commercial shark permit holders of their eligibility 
for a directed or incidental shark permit, based on the eligibility 
criteria set forth in paragraph (a)(1) of this section. Upon receipt of 
this determination, eligible permit holders may submit an application 
for the appropriate permit.
    (ii) If a vessel owner or operator has been notified that the 
vessel is not eligible for a directed shark permit or is only eligible 
for an incidental shark permit, and the vessel owner or operator can 
provide credible evidence that the

[[Page 68206]]

vessel does qualify under the pertinent criteria, the vessel owner or 
operator may apply for the appropriate permit by submitting the 
documentation required under paragraph (9)(ii) of this section. If, 
based on the documentation supplied with the application, NMFS 
determines that the vessel meets the eligibility criteria, the 
appropriate permit will be issued.
    (8) Application denial. If, based on the documentation supplied 
with the application, NMFS determines that the vessel does not meet the 
eligibility criteria specified in paragraphs (a)(1) and (a)(2) of this 
section or the conditions specified in paragraph (e) of this section, 
the permit will be denied. Letters of denial will be sent via certified 
mail.
    (9) Appeals. (i) Any applicant denied a limited access permit for 
Atlantic shark vessels may appeal the denial to NMFS within 90 days of 
the notice of denial. The sole ground for appeal is that NMFS erred in 
its determination of eligibility on the basis of incorrect or 
incomplete data. Valid documentation of landings covering the 
eligibility period as specified in paragraph (a)(9)(ii) of this section 
must be provided by the applicant for NMFS to consider an appeal. 
Photocopies will be acceptable for initial submission. NMFS may request 
originals at a later date, which will be returned to the applicant via 
certified mail. Any such appeal must be in writing. Documentation that 
is of questionable authenticity will be referred for investigation to 
NMFS' Office of Enforcement.
    (ii) Valid documentation. The only documentation that will be 
considered in support of an application or appeal are official NMFS 
logbook records that were submitted to NMFS prior to August 30, 1995, 
state landings records, and official, verifiable sales slips or 
receipts from registered dealers. Dealer sales slips and receipts must 
definitively show the species landed and vessel's name or other 
traceable information for the harvesting vessel and must contain a 
sworn affidavit by the dealer confirming the accuracy and authenticity 
of the records.
    (iii) Status during appeal. The Regional Director shall issue a 
provisional permit for the category of appeal for, which shall be valid 
for the pendency of the appeal to a vessel and owner for which an 
appeal has been initiated. The provisional permit must be carried on 
board the vessel while participating in the Atlantic shark fishery and 
is not transferable.
    (iv) Appeals officers. NMFS will appoint appeals officers, who will 
review the written materials and submit findings and a recommendation 
to the Regional Director within 30 days of receipt of a complete 
appeal.
    (v) Final decision on appeals. Upon receiving the findings and a 
recommendation, the Regional Director will issue a final decision on 
the appeal. The Regional Director's decision is the final 
administrative action of the Department of Commerce.
    (vi) Notification of final decision on appeals. The Regional 
Director shall notify the appellant of the final decision on the appeal 
by letter sent via certified mail. If the appeal is denied, the 
provisional permit will become invalid 5 days after receipt of the 
notice of denial. If the appeal is granted, the provisional permit will 
become invalid upon receipt of the appropriate permit.
    (10) Adjustments to eligibility. In years after 1997, NMFS may 
adjust the eligibility criteria for issuance of a shark permit. In 
making the adjustment, NMFS shall take into consideration the fishing 
mortality goals and the objectives of the FMP. Any such adjustment may 
be made following a reappraisal and analysis under the framework 
provisions specified in Sec. 678.27.
    (11) Condition. A vessel owner who applies for a shark permit under 
this section must agree, as a condition of the permit, that the 
vessel's shark fishing, catch, and gear are subject to the requirements 
of this part during the period of validity of the permit, without 
regard to whether such fishing occurs in the EEZ, landward of the EEZ, 
or outside the EEZ, and without regard to where such shark or gear are 
possessed, taken, or landed. However, when a vessel fishes in the 
waters of a state that has more restrictive regulations on shark 
fishing, those more restrictive regulations may be applied by that 
state to fishing, catch, and gear in its waters.
    (b) Application for a shark permit. (1) In the year 1997, an 
initial application for a shark permit must be submitted and signed by 
the owner (in the case of a corporation, the qualifying officer or 
shareholder; in the case of a partnership, the qualifying general 
partner) or operator of the vessel. The application must be submitted 
to the Regional Director at least 30 days prior to the date on which 
the applicant desires to have the permit made effective. An applicant 
must provide the following:
    (i) A copy of the vessel's U.S. Coast Guard certificate of 
documentation or, if not documented, a copy of its state registration 
certificate.
    (ii) The vessel's name, official number, registered gross tonnage, 
and registered length.
    (iii) Name, mailing address including ZIP code, telephone number, 
and social security number, and date of birth of the owner (if the 
owner is a corporation/partnership, in lieu of the social security 
number, the employer identification number, if one has been assigned by 
the Internal Revenue Service (IRS), and, in lieu of the date of birth, 
provide the date the corporation/partnership was formed).
    (iv) If the owner does not meet the earned income qualification 
specified in paragraph (b)(1)(vi) of this section and the operator does 
meet that qualification, the name, mailing address including ZIP code, 
telephone number, social security number, and date of birth of the 
operator.
    (v) Information concerning vessel, gear used, fishing areas, and 
fisheries vessel is used in, as specified on the application form.
    (vi) A sworn statement by the applicant (if the applicant is a 
corporation or partnership, by an officer, shareholder, general 
partner, or if the applicant is an operator, by the operator) 
certifying that, during 1 of the 3 calendar years preceding the 
application:
    (A) More than 50 percent of his or her earned income was derived 
from commercial fishing, that is, sale of the catch, or from charter or 
headboat operations;
    (B) His or her gross sales of fish were more than $20,000; or
    (C) For a vessel owned by a corporation or partnership, the gross 
sales of fish of the corporation or partnership were more than $20,000.
    (vii) Documentation supporting the statement of income, if required 
under paragraph (b)(1)(x) of this section.
    (viii) A sworn statement that the applicant agrees to the 
conditions specified in paragraph (a)(11) of this section.
    (ix) Any other information that may be necessary for the issuance 
or administration of the permit, as requested by the Regional Director 
and included on the application form.
    (x) The Regional Director may require the applicant to provide 
documentation supporting the sworn statement under paragraph (b)(1)(vi) 
of this section before a permit is issued or to substantiate why such 
permit should not be revoked or otherwise sanctioned under paragraph 
(h) of this section. Such required documentation may include copies of 
appropriate forms and schedules from the applicant's income tax return. 
Copies of income tax forms and schedules are treated as confidential.

[[Page 68207]]

    (2) In years after 1997, a shark permit holder may apply for a 
shark permit renewal, provided that the initial information under which 
the permit holder qualified for a shark permit has not changed as 
specified in paragraph (k) of this section. Shark permits must be 
renewed annually and renewal applications must be submitted to the 
Regional Director at least 30 days prior to the date on which the 
applicant desires to have the permit made effective. Only a holder of a 
valid shark permit is eligible for a renewal of that permit.
    (3) In years after 1997, an application for permit transfer of a 
directed shark permit to a new vessel and/or owner will be authorized, 
subject to transfer and upgrading restrictions specified in paragraphs 
(a)(4) and (a)(5) of this section, respectively. Incidental shark 
permits are not transferable. All other requirements and restrictions 
specified in this part apply to transferred limited access permits and 
permit holders.
    (c) Dealer permits. A dealer who receives sharks from the 
management unit must have a valid dealer permit issued under this part. 
An application for an annual dealer permit must be submitted and signed 
by the dealer or an officer of a corporation acting as a dealer. The 
application must be submitted to the Regional Director at least 30 days 
prior to the date on which the applicant desires to have the permit 
made effective.
    (1) A permit applicant must provide the following:
    (i) A copy of each state wholesaler's license held by the dealer.
    (ii) Business name; mailing address, including zip code, of the 
principal office of the business; employer identification number, if 
one has been assigned by the Internal Revenue Service; and date the 
business was formed.
    (iii) The address of each physical facility at a fixed location 
where the business receives fish.
    (iv) Applicant's name; official capacity in the business; address, 
including zip code; telephone number; social security number; and date 
of birth.
    (v) Any other information that may be necessary for the issuance or 
administration of the permit, as specified on the application form.
    (2) Transfer. A dealer permit issued under paragraph (c)(1) of this 
section may be transferred upon sale of the dealer's business. However, 
such transferred permit shall expire 30 days after sale of the dealer's 
business. A person purchasing a permitted dealership who desires to 
conduct activities for which a new permit is required after that 30-day 
period must apply promptly for a permit in accordance with paragraph 
(c) of this section.
* * * * *
    (e) Issuance--(1) Limited access shark permits. Except as provided 
in subpart D of 15 CFR part 904 and under paragraphs (a)(8) and (a)(9) 
of this section, the Regional Director shall issue a Federal shark 
permit within 30 days of receipt of the application unless:
    (i) The applicant has failed to submit a complete application. An 
application is complete when all requested forms, information, 
documentation, and fees, if applicable, have been received and the 
applicant has submitted all applicable reports specified at Sec. 678.5;
    (ii) The application was not received by NMFS by the deadlines set 
forth in paragraph (a)(1)(v) of this section;
    (iii) The applicant and applicant's vessel failed to meet all 
eligibility requirements described in paragraphs (a)(1) and (a)(2) of 
this section; or
    (iv) The applicant has failed to meet any other application 
requirements stated in this part.
    (2) Dealer permits. The Regional Director will issue a dealer 
permit at any time to an applicant if the application is complete. An 
application is complete when all requested forms, information, and 
documentation have been received and the applicant has submitted all 
applicable reports specified at Sec. 678.5(a) or Sec. 678.5(b).
    (3) Incomplete applications. Upon receipt of an incomplete 
application, the Regional Director will notify the applicant of the 
deficiency. If the applicant fails to correct the deficiency within 90 
days of the date of the Regional Director's letter of notification, the 
application will be considered abandoned.
    (f) Duration. A permit remains valid for the period specified on 
it, and the conditions accepted upon its issuance remain in effect for 
that period, unless the vessel is retired from the shark fishery or the 
permit is revoked, suspended, or modified pursuant to subpart D of 15 
CFR part 904.
    (g) Display. A vessel permit issued pursuant to paragraphs 
(a)(9)(iii) or (b) of this section must be carried on board the vessel, 
and such vessel must be identified as required by Sec. 678.6. A dealer 
permit issued pursuant to paragraph (c) of this section must be 
available on the dealer's premises. The operator of a vessel or a 
dealer must present the permit for inspection upon the request of an 
authorized officer.
    (h) Sanctions and denials. A permit issued pursuant to this section 
may be revoked, suspended, or modified, and a permit application may be 
denied, in accordance with the procedures governing enforcement-related 
permit sanctions and denials found at subpart D of 15 CFR part 904.
    (i) Alteration. A permit that is altered, erased, or mutilated is 
invalid.
    (j) Replacement. A replacement permit may be issued. An application 
for a replacement permit will not be considered a new application. A 
fee, the amount of which is stated with the application form, must 
accompany each request for a replacement permit.
    (k) Change in application information. The owner or operator of a 
vessel with a shark permit or a dealer with a permit must notify the 
Regional Director within 30 days after any change in the application 
information required by paragraphs (a), (b), or (c) of this section. 
The permit is void if any change in the information is not reported 
within 30 days.
* * * * *
    4. In Sec. 678.7, paragraphs (b), (k) through (m), (p), (q), (x), 
and (y) are revised to read as follows:


Sec. 678.7  Prohibitions.

* * * * *
    (b) Fail to display a permit, as specified in Sec. 678.4(g).
* * * * *
    (k) Remove the fins from a shark and discard the remainder, as 
specified in Sec. 678.22(b)(1).
    (l) Possess shark fins, carcasses, or parts, aboard or offload 
shark fins from a fishing vessel, except as specified in Sec. 678.22, 
or possess shark carcasses or parts aboard, or offload shark fins, 
carcasses, or parts, from a vessel, except as specified in 
Sec. 678.22(d).
    (m) Fail to release a shark in the manner specified in 
Sec. 678.22(c).
* * * * *
    (p) Land or possess on any trip, shark in excess of the vessel trip 
limit, as specified in Sec. 678.22(d).
    (q) Transfer a shark at sea, as specified in Secs. 678.22(d)(3) and 
678.23(e).
* * * * *
    (x) Exceed the vessel trip limits, as specified in Sec. 678.22(d).
    (y) Purchase, trade, or barter, or attempt to purchase, trade, or 
barter, a shark from the management unit without an annual dealer 
permit, as specified in Sec. 678.4(c).
* * * * *
    5. Section 678.22 is revised to read as follows:


Sec. 678.22  Harvest Limitations.

    (a) Limited access permit restrictions. (1) Only holders of valid 
directed shark

[[Page 68208]]

permits issued pursuant to Sec. 678.4 may target and harvest sharks 
under the specifications outlined in Secs. 678.20, 678.21, and 678.24 
through 678.28.
    (2) Only holders of valid incidental shark permits issued pursuant 
to Sec. 678.4 may retain a maximum of four sharks (all species 
combined) per vessel per day.
    (b) Finning. (1) The practice of ``finning,'' that is, removing 
only the fins and returning the remainder of the shark to the sea, is 
prohibited in the EEZ or aboard a vessel that has been issued a permit 
pursuant to Sec. 678.4.
    (2) Shark fins that are possessed onboard or offloaded from a 
fishing vessel must be in proper proportion to the weight of carcasses. 
That is, the weight of fins may not exceed 5 percent of the weight of 
the carcasses. All fins must be weighed in conjunction with the 
weighing of the carcasses at the vessel's first point of landing and 
such weights of the fins landed must be recorded on the weighout slips 
submitted by the vessel owner or operator under Sec. 678.5(a).
    (3) Shark fins may not be possessed onboard a fishing vessel after 
the vessel's first point of landing.
    (c) Release. A shark that is harvested in the EEZ or harvested by a 
vessel that has been issued a permit pursuant to Sec. 678.4 that is not 
retained--
    (1) Must be released in a manner that will ensure maximum 
probability of survival.
    (2) If caught by hook and line, must be released by cutting the 
line near the hook without removing the fish from the water.
    (d) Vessel trip limits--(1) Directed permits. The owner or operator 
of a vessel that has been issued a directed shark permit pursuant to 
Sec. 678.4 may not possess on any trip, or land from any trip, large 
coastal species in excess of 4,000 lb (1,814 kg), dressed weight.
    (2) Incidental permits. The owner or operator of a vessel that has 
been issued an incidental shark permit pursuant to Sec. 678.4 may not 
possess on any trip, or land from any trip, in excess of four sharks 
per day of all shark species combined. Vessel logbooks will be the sole 
criterion used to determine dates of trip origin and termination for 
each trip.
    (3) Transfer at sea. A shark from any of the three management units 
may not be transferred at sea from a vessel issued an Atlantic shark 
permit issued under Sec. 678.4 to any other vessel.
    6. In Sec. 678.26, paragraph (c) is revised to read as follows:


Sec. 678.26  Restrictions on sale upon landing.

* * * * *
    (c) Fins from a shark harvested in the EEZ, or by the owner or 
operator of a vessel that has been issued a permit under Sec. 678.4, 
that are disproportionate to the weight of carcasses landed (see 
Sec. 678.22(b)(2)) may not be sold, purchased, traded, or bartered or 
attempted to be sold, purchased, traded, or bartered.
* * * * *
[FR Doc. 96-32891 Filed 12-20-96; 4:50 pm]
BILLING CODE 3510-22-W