[Federal Register Volume 63, Number 166 (Thursday, August 27, 1998)]
[Notices]
[Pages 45839-45854]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-23074]


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DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service


Policy on Giant Panda Permits

AGENCY: Fish and Wildlife Service, Interior.

ACTION: Notice of policy on the issuance of permits for giant panda 
imports.

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SUMMARY: The U.S. Fish and Wildlife Service (Service) announces a 
policy on the issuance of permits for the import of live giant pandas 
to clarify what information the Service considers in making the permit 
findings under the Convention on International Trade in Endangered 
Species and the U.S. Endangered Species Act and to assist persons in 
filing a complete application. The policy is intended to complement, 
and not replace, the current permit procedures and issuance criteria in 
the regulations. The goal of this policy is that all imports directly 
benefit panda conservation through a coordinated effort that supports 
China's National Plan, National Survey, or Captive Breeding Plan. Based 
on current information on the status of pandas and their habitat, the 
policy emphasizes research and captive-breeding activities needed to 
ensure the captive population becomes self-sustaining and to recover 
panda populations in the wild. Thus, all monies used in a loan 
agreement or raised as a result of a panda import should fund giant 
panda conservation efforts, with a significant portion being used for 
priority in-situ conservation projects in China. Display of a panda 
would be allowed as an ancillary component that would not interfere 
with the research or captive-breeding activities. It is unlikely that 
the Service would be able to make the necessary findings to issue a 
permit to import animals removed from the wild after December 31, 1996. 
The policy also addresses the transfer of live pandas within the United 
States and the import or export of tissue samples. The policy 
supersedes previous policy. The suspension of the review and processing 
of permit applications to import live giant pandas is now lifted.

DATES: This policy is effective August 27, 1998 and will remain in 
effect until modified or terminated.

ADDRESSES: Questions regarding this policy should be addressed to the 
Chief, Office of Management Authority, U.S. Fish and Wildlife Service, 
1849 C Street, N.W., Mailstop ARLSQ-700, Washington, D.C. 20240.

FOR FURTHER INFORMATION CONTACT: Teiko Saito, Chief, Office of 
Management Authority, telephone (703) 358-2093 or fax (703)-358-2280, 
(see ADDRESSES section).

SUPPLEMENTARY INFORMATION:

Acronyms Used in This Notice

AZA  American Zoo and Aquarium Association
CBSG  Conservation Breeding Specialist Group (a program of the IUCN)
CITES  Convention on International Trade in Endangered Species of Wild 
Fauna and Flora
ESA  U.S. Endangered Species Act
IUCN  World Conservation Union
MOC  Ministry of Construction (China)
MOF  Ministry of Forestry (China)
SSP  Species Survival Program (a program of the AZA)
WWF  World Wildlife Fund for Nature

Background

    The survival and ultimate recovery of the population of the giant 
panda (Ailuropoda melanoleuca) in its ecosystem is the strong desire of 
the United States, the People's Republic of China (China), and the 
international conservation community. As such, the panda is subject to 
strict protection by its listing as an endangered species under the ESA 
and its inclusion in Appendix I of CITES. The Service is responsible 
for regulating pandas by deciding whether to grant permits to allow 
their movement into and within the United States. In making these 
decisions the Service, under the ESA, must determine whether the 
proposed activities are not likely to jeopardize the continued 
existence of the giant panda and would be for scientific research that 
promotes the conservation of the species or enhancement of propagation 
or survival, and under CITES, would be for purposes that are not 
detrimental to the survival of the species and that are not primarily 
commercial.
    In the late 1980's, the proposals for temporary exhibition (short-
term) loans of giant pandas became an increasingly controversial issue. 
During one period in 1988, the Service received reports that as many as 
30 institutions may have been negotiating, or planning to negotiate, 
with various entities in China to arrange panda loans, potentially 
posing additional threats to the wild and captive populations of 
pandas. As a result the Service, through the public review process, 
published a policy on March 14, 1991 (56 FR 10809), for the issuance of 
import permits for short-term exhibition loans. In 1992, after the 
Service had issued a permit to the Columbus Zoo to import a pair of 
giant pandas for a short-term exhibition loan, the CITES Secretariat 
requested the Service to re-evaluate its policy on panda imports. The 
Service published a notice in the Federal Register on June 29, 1992 (57 
FR 28825), requesting public comment on the existing policy.
    Before re-evaluation of the existing policy on short-term 
exhibition loans was completed, the Service received an application 
from the Zoological Society of San Diego (San Diego Zoo) to import a 
pair of giant pandas for a long term, captive-breeding loan. On April 
20, 1993, the AZA announced the development of a Giant Panda 
Conservation Action Plan, which has since been formalized. The plan 
outlines a captive-breeding program with support from 29 zoological 
institutions in North America. In addition, in July 1993, China's MOC 
(the agency generally responsible for China's ex-situ panda 
conservation) published the second giant panda studbook, listing all 
pandas then in captivity.
    With the possibility of receiving an increasing number of import 
permit applications for giant pandas for public exhibition, scientific 
research, and/or captive-breeding purposes, the Service felt that a re-
examination of the long-range implications of panda imports was 
necessary to ensure that such imports best serve the conservation needs 
of the species. Thus, on December 20, 1993, the Service announced in a 
news release the temporary suspension of the processing of any new 
permit applications for the import of live giant pandas during a 
reassessment of the policy. On May 4, 1994, the Service requested 
public comments and announced a working public meeting to assist the 
Service in formulating the draft revised policy (59 FR 23077). Public 
meetings were held by the Service on May 26 and August 23, 1994. The 
Service published the proposed policy for comment on March 30, 1995 (60 
FR 16487). See that notice for a summary of the comments previously

[[Page 45840]]

received. The comment period on the new proposed policy was 
subsequently extended for an additional 60 days in 1995 and reopened 
for 150 days in 1997 to receive new information relevant to the 
proposed policy (60 FR 33224, 62 FR 35518, and 62 FR 53017).
    The following summarizes new information received during the open 
comment periods of the proposed policy and discusses the rationale for 
decisions reflected in the final policy.

Population Status

    The proposed policy summarized the information on the status of 
wild panda populations. The 1985-1988 survey remains the most current 
information on the status of wild panda populations. The most commonly 
accepted current estimate is that there are fewer than 1,000 pandas 
left in the wild. A new Chinese national survey is to commence in 1998.

Status of Captive Breeding in China and the Need for Breeding 
Efforts Outside of China

    The proposed policy indicated that the captive-breeding program in 
China is not currently self-sustaining. While this remains true, 
advances have been made. In December 1996, the Chinese Association of 
Zoological Gardens, MOC, in collaboration with the CBSG, held a Giant 
Panda Captive Management Planning Workshop (MOC/CBSG Workshop) in 
Chengdu, China. The objectives of the workshop were to assist local 
captive population managers and policy makers to: (1) Formulate 
priorities for a practical and scientific management program that fully 
utilized all founders in captivity for the purpose of developing a 
healthy, growing population of giant pandas in China; (2) formulate a 
program that has linkage to the wild population, including the possible 
reintroduction of individuals, if needed; (3) eliminate the need to 
take more giant pandas from the wild; (4) develop a risk analysis and 
simulation population model for the captive population that can be used 
to guide and evaluate management and research activities; (5) identify 
useful technology transfer and training, including evaluating all 
adult, reproductive-age giant pandas in Chinese institutions; and (6) 
identify and recruit potential international collaborators, when 
needed, to enhance action. A final report was published that outlines 
recommendations in order to meet these goals.

Reintroduction

    The proposed policy noted that reintroduction is a long-term goal 
that needs to be incorporated into coordinated international 
conservation efforts. The Service still understands that reintroduction 
is a stated long-term goal and sees value in discussing this issue as 
long as it does not overshadow efforts to protect panda habitat.
    In September 1997, WWF and China's MOF (the ministry generally 
responsible for in-situ panda conservation) held a workshop on 
reintroduction. Several action steps were recommended: (1) Implement a 
national survey; (2) conduct further research aimed at improving birth 
and neonatal survival rates in the captive population; (3) continue to 
urge the government of China to completely implement the China National 
Plan for Panda Conservation (National Plan); (4) promote long-term 
national and international cooperation in raising funds; and (5) 
initiate an experimental program with pandas in the captive population 
designed to provide additional information on conducting successful 
releases.

Giant Panda Conservation Plans

    The proposed policy outlined the status of the National Plan and 
AZA's Giant Panda Conservation Action Plan, and focused on funding of 
in-situ projects from the National Plan to ensure conservation of 
pandas in the wild. While the primary goal of the policy continues to 
be conservation of pandas in the wild, the policy has been broadened to 
include all of China's giant panda conservation efforts--the National 
Plan, National Survey, and Captive Breeding Plan (as updated by the 
MOC/CBSG Workshop report). The Service recognizes that although the 
National Plan and National Survey are the primary plans identifying 
high priority in-situ projects, the Captive Breeding Plan may have in-
situ projects (e.g., surveys or reintroduction efforts). The Service 
also recognizes that although the Captive Breeding Plan is the primary 
plan identifying high priority ex-situ conservation projects, the 
National Plan may have ex-situ projects.
    In September 1997, the Chinese hosted the International Symposium 
on Environmental Protection and City Development of the 21st Century in 
which panda conservation was a key topic. This symposium is a further 
example of the willingness of the Chinese to collaborate and cooperate 
on an international scale to further the conservation of pandas.

Purposes

    The purposes of the ESA are to provide a means by which the 
ecosystems upon which endangered and threatened species depend may be 
conserved, to provide a program for the conservation of such species, 
and to take such steps as may be appropriate to achieve the purposes of 
certain conservation treaties and conventions. The purpose of CITES is 
to protect animals and plants to ensure that commercial demand does not 
threaten their survival in the wild by regulating trade in listed 
species. This policy is derived from these purposes. The proposed 
policy required that any import should be part of a coordinated 
international panda effort. While this should be a long term goal, it 
may not be possible to have all institutions worldwide holding pandas 
to be part of an international panda conservation effort. Therefore, 
the final policy clarifies that any U.S. institution wishing to import 
pandas should participate in a coordinated international conservation 
effort as much as possible and coordinate efforts in the context of 
China's National Plan, National Survey, or Captive Breeding Plan.

Wild-Taken Pandas

    The proposed policy set out that no pandas removed from the wild 
after December 31, 1986, be allowed to be imported because of the 
potential threat of incentives for removal due to demand for captive 
pandas. The Service re-evaluated this determination and based on new 
information, changed the date to December 31, 1996. This new date 
coincides with the date of the MOC/CBSG Workshop where it was 
determined that no additional wild-caught pandas were needed to sustain 
the captive population. Concerns over take from the wild have decreased 
based on information from the giant panda studbook which shows only a 
few pandas have been removed from the wild in the past several years 
and on previous information from China on rescue guidelines. Changing 
the date will allow imports of genetically important wild-caught pandas 
that are already in captivity but have not bred. One aim of the AZA 
Giant Panda SSP is to focus their expertise on investigating why these 
pandas are not breeding. Known breeders would most likely remain in 
China as part of the breeding program. See further discussion of this 
topic in the Summary of Comments.

Age and Other Parameters of Animals Available for Importation

    The proposed policy provided that no post-breeding age pandas 
(i.e., 20 years and older) would be considered for

[[Page 45841]]

import because it was felt that the risks from transport were 
unacceptable. In the final policy the Service will use age as a factor 
in determining issuance of a permit as it relates to the proposed 
purpose of import. However, no upper age limit is set since the Service 
has no scientific information to show that it would be very risky to 
ship older pandas, but infirm animals will not be allowed to be 
imported if transport will compromise the health of the panda.

Length of Loans

    In the proposed policy, the length of giant panda loans was to be 
determined by the purpose(s) of the loan and the length of time 
necessary to accomplish the goals of the import. This has not been 
changed in the final policy. The Service believes that internationally 
coordinated giant panda conservation efforts could incorporate various 
types of import, exchange, or loan arrangements requiring varying 
lengths of time.

Enhancement and Conservation Benefits of Specific Projects

    The Service proposed that the majority of net profits (80 percent) 
should be used to fund in-situ conservation projects in China's 
National Plan. The Service continues to believe that in-situ 
conservation is critical to the recovery of giant pandas in China, but 
recognizes the need to ensure to the extent possible that the captive-
breeding program in China is self-sustaining. Additionally, funding of 
captive breeding and research can potentially contribute toward 
conservation of pandas in the wild, particularly now that China has a 
scientifically based captive-breeding/research plan. Thus, the policy 
now states that a significant portion of all funds associated with the 
loan, not just net profits, should be used to fund in-situ conservation 
projects, instead of designating a specific percentage. This retains 
the appropriate emphasis on in-situ conservation, but allows more funds 
to support ex-situ projects as primarily outlined in the Captive 
Breeding Plan. The proposed policy also outlined a regime to identify 
and track project implementation. This has been retained, but project 
selection may now be expanded beyond the National Plan to include the 
National Survey and Captive Breeding Plan.
    The Service continues to emphasize the need to relate giant panda 
imports to the conservation and enhancement of the species in the wild, 
especially through funding of in-situ projects. Presumably, most of the 
imports will be from China but funding associated with imports of 
pandas from other countries will also need to be linked to in-situ 
conservation projects, although more flexibility will be allowed for 
these imports. It is expected that most imports would be for multiple 
purposes and funds (loan money and/or net profits) would be generated. 
The allocation of funds to panda conservation satisfies part of the 
conservation and enhancement findings required by an import under the 
ESA. If no funds are associated with the import or transfer of live 
pandas, the proposed activities must significantly contribute to panda 
conservation in the wild. On the other hand, if funds are involved, 
then a significant portion of all funds, including net profits received 
by an applicant during a loan period, regardless of the source of the 
panda, should be used for conservation projects.

Scientific Research

    The Service proposed that imports for scientific research must 
contribute to the conservation of pandas in the wild and in captivity. 
The final policy has added some flexibility in that the research can be 
more focused on contributions for captive animals if the import is for 
dual purposes (scientific research and enhancement of the propagation 
and survival of the species under the ESA).
    There needs to be continual coordinated efforts to set priorities 
for panda research. China's National Plan provides the following 
research priorities: (1) Habitat improvement; (2) captive breeding; (3) 
ecology, population status, and monitoring; (4) rearing and nutrition; 
(5) prevention of illness; and (6) reintroduction of captive pandas to 
the wild. The ``Giant Panda Breeding Plan'' developed in China lists 
the following areas that need basic research: (1) artificial 
insemination biology and techniques; (2) breeding behavior; (3) disease 
prevention; (4) reproductive physiology; (5) diet; (6) mating ability; 
(7) reproductive longevity; and (8) fertility. These priorities for the 
captive population are further clarified in the report from the MOC/
CBSG Workshop. Because of the precarious level of the panda population, 
it is important that research findings are shared quickly and 
methodologies are transferred to China for use in the field and in the 
captive-breeding program.
    The ESA regulations [50 CFR 17.22(a)(1)(vii)] provide that an 
applicant must give a full statement of the reasons the applicant is 
justified in obtaining a permit for scientific purposes, including 
details of the activities. The final policy continues to outline that 
the applicant must provide a research proposal that demonstrates that 
the research is properly designed and can be accomplished with the 
available expertise and resources. The Service will not categorize or 
identify acceptable kinds of research, but will retain the option of 
evaluating the validity and/or current need of the proposal based on 
priorities included in China's National Plan, National Survey, or 
Captive Breeding Plan, or any subsequent modification of these plans. 
If the panda(s) would also be on exhibition, the applicant should have 
a monitoring plan to ensure that the display does not interfere with 
the research or bias the data. Thus, under the proposed policy the 
applicant needed to have adequate facilities separate and apart from 
the public exhibition areas in case it is found that exhibition 
interfered with the research. This same guidance was included in the 
Captive Breeding section. Through the comments, it was evident that the 
wording was interpreted to mean applicants needed facilities totally 
separated from the exhibit. The final policy clarifies that the intent 
is for an applicant to have off-exhibit facilities of sufficient size 
to house pandas on a long term basis, if necessary, to conduct research 
or breeding, but not necessarily be physically separated.

Captive Breeding

    The ESA regulations [50 CFR 17.22(a)(1)(viii)] provide that an 
applicant demonstrate a willingness to participate in a cooperative 
breeding program and maintain or contribute data to a studbook. The 
current issuance criteria require the Service to find the proposed 
activity will not directly or indirectly conflict with any known 
program intended to enhance survival probabilities of the population. 
Thus, the proposed policy emphasized that institutions that import 
pandas for captive breeding should participate actively in a 
coordinated international panda conservation effort and needed to 
supplement the breeding program in China. The final policy continues to 
require that imports for captive breeding supplement China's breeding 
program but ties such participation to the MOC/CBSG Workshop report. In 
addition, to assist in wild panda recovery and development of a self-
sustaining captive population, captive-breeding activities should have 
a research component.
    The continued decline of the wild population of giant pandas and 
the increasing fragmentation of its habitat may make it increasingly 
important to establish a self-sustaining captive

[[Page 45842]]

population. The current captive population represents about 10 percent 
of the total panda population, captive and wild. As of December 1996, 
there were 124 giant pandas in captivity in 38 institutions: 104 
animals were in institutions in China and 20 pandas were in 9 
institutions located outside of China. In China, five institutions had 
73 animals and were responsible for nearly all the breeding success. 
Seventeen institutions held single animals. The Chinese recognize that 
these captive pandas need to be moved for better breeding opportunities 
and to ensure that all mature individuals participate in breeding. Of 
the 20 pandas currently held in 9 institutions outside China, 3 
institutions hold only 1 panda. These data demonstrate the great need 
to coordinate the movement of captive-held pandas internationally.
    The captive-breeding program in China is not currently self-
sustaining. Between 1936 and 1988, 345 pandas held in captivity 
produced 67 litters of 106 cubs, with only 32 surviving more than a 
year. In recent years, improvement in management and joint efforts 
within China enhanced breeding and survival rates and reduced the 
infant mortality rate of the captive population. However, a review of 
the International Studbook of the Giant Panda suggests that the current 
number of founders contributing to the captive population is 
inadequate. According to the studbook, the current captive population 
is descended from 32 founders. However, recent research suggests that 
fewer than 32 founders may exist because the paternity of some of the 
captive-born pandas is uncertain. Ongoing research should solve this 
question. The current captive population includes 48 wild-caught pandas 
that have not reproduced, but only 32 of these are currently of 
reproductive age. If these pandas can be encouraged to breed, the 
captive population will not need additional genetic material from the 
wild population to become self-sustaining. This is supported by 
information from the 1996 MOC/CBSG Workshop.
    Permittees who import pandas for captive breeding should actively 
coordinate with all panda holders as much as possible and must 
participate in the AZA's Giant Panda SSP or a similar plan approved by 
the Service. Imports of pandas for the sole purpose of producing more 
pandas would not likely satisfy the required finding of enhancement 
under the ESA. Since it is expected most of the pandas to be imported 
into the United States for breeding would have a history of not 
reproducing, it is anticipated that there will be a research component 
to any captive-breeding activities.

Exhibition

    The policy proposed two alternatives for exhibition: (1) Exhibition 
solely as an ancillary component, and (2) short-term exhibition. The 
final policy reflects Alternative 1. Therefore, applications for import 
of pandas solely for exhibition purposes would not be approved as a 
general matter. This is consistent with the AZA moratorium on short-
term panda loans. Educational display (exhibition) would be allowed as 
an ancillary component of a scientific research or research/captive-
breeding program, when the display will not interfere with the research 
or captive-breeding activities. Even temporary loans of pandas solely 
for display to another institution during the non-breeding season would 
likely not be allowed, as this could be disruptive to behavioral 
interactions, endocrine monitoring, and research designed to maximize 
breeding success.
    With advances in coordinated conservation efforts for the giant 
panda, if institutions in the United States are exhibiting captive 
pandas, the Service believes that the institutions should focus their 
energy on activities that best ensure the recovery of wild pandas. The 
Service recognizes that the use of any of these animals for short-term 
exhibition could detract from the overall captive conservation efforts 
by stimulating institutions to use resources for short-term exhibition, 
rather than committing resources to needed captive breeding or 
research. Furthermore, the use of breeding age pandas for short-term 
exhibition loans could increase the stress and reduce acclimation of 
pandas to breeding surroundings while minimizing the opportunities for 
important research and captive-breeding activities. Thus, the Service, 
as a matter of policy, discourages the issuance of permits for the 
import of pandas for solely exhibition purposes (even though such 
exhibits might raise substantial funds to go back to China). Every 
panda import must have intrinsic conservation benefits in its own 
right, in addition to financial contributions to China.

Primarily Commercial

    Under CITES, Appendix-I species, such as giant pandas, cannot be 
imported for primarily commercial purposes. Therefore, an applicant for 
a giant panda import permit must provide sufficient information to the 
Service to consider in making a finding that the import is not for 
primarily commercial purposes [(50 CFR 23.15(d)(7)]. Thus, the language 
on internal accounting systems was clarified in the final policy and 
monitoring visitation was added as a way to provide additional 
information needed to calculate net profits. No other major changes 
were made in the final policy in this section.

Suitability of Facilities

    Under the CITES regulations, the recipient of a giant panda is 
required to have suitable housing and equipment to care for the 
panda(s) [50 CFR 23.15(d)(6)] and under the ESA regulations at 50 CFR 
17.22(a)(2)(vi), the facilities and resources must be adequate to 
successfully accomplish the objectives stated in the permit 
application. Applicants for a giant panda permit must submit sufficient 
information to show that they meet these requirements. The proposed 
policy enabled applicants to provide copies of existing protocols for 
monitoring health and behavior recommended by a coordinated 
international panda conservation effort. The final policy allows 
applicants to submit protocols recommended by a coordinated panda 
conservation effort, such as the AZA Giant Panda SSP, since there is no 
one true organized international panda conservation effort at this 
time. Additionally, the requirement to note any roads adjacent to panda 
facilities was dropped since there is no evidence that shows activity 
or noise from adjacent roads negatively affects panda behavior.

Transfers of Pandas to Other Entities Within the United States

    The policy clarifies that persons intending to transfer live pandas 
in the United States will need to meet the provisions of the policy, 
either by obtaining an interstate commerce permit or prior approval of 
the Service as conditioned by the import permit.

Summary of Comments and Responses

    Comments on the proposed policy were received during four comment 
periods (March to May 1995, June to July 1995, July to September 1997, 
and September to November 1997) and were considered in formulating this 
final policy. The following summarizes those comments organized by 
elements in this policy. The Service received 205 comments (letters, 
form letters, and form post cards) from 4 zoological institutions, 5 
conservation groups, 7 animal interest groups, 3 business or trade 
organizations, 1 State agency, 7 foreign governmental agencies, and 178 
individuals. The Service has reviewed all of these written comments. 
Comments or information updating the data presented in the 
Supplementary

[[Page 45843]]

Information section are incorporated into that section of this final 
notice.

Purposes

    Issue: Several commenters suggested that there was no single 
coordinated international panda conservation effort and that there 
should be flexibility and discretion to pursue the primary goal of 
survival of the species.
    Response: The Service agrees that it may not be possible to have 
all institutions worldwide that have pandas be part of one 
international panda conservation effort. However, this should be a long 
term goal and any U.S. institution wishing to import giant pandas 
should participate in a coordinated panda conservation effort as much 
as possible and should work closely with the Chinese government to 
ensure their efforts are based on recommendations of China's National 
Plan, National Survey, or the Captive Breeding Plan. The language has 
been changed appropriately.
    Issue: One commenter stated that the Service should withdraw the 
proposed policy, abandon efforts to set any specific policy for imports 
of giant pandas, immediately lift the moratorium on panda imports, and 
evaluate imports on a case-by-case basis.
    Response: The Service disagrees since pandas are critically 
endangered and engender much public interest. The purpose of the policy 
is to openly and clearly outline how applicants who wish to import 
giant pandas can meet the criteria of CITES and the ESA. This policy 
will be applied to each application for import on a case-by-case basis 
and will provide clear guidance for consistent evaluation so pandas in 
the wild will benefit.
    Issue: One commenter thought the ban on importing giant pandas 
should remain in place so that maximum conservation resources for 
saving these animals could be focused on saving them in their natural 
habitat. Other commenters stated that no giant pandas should be held in 
a zoo.
    Response: The Service agrees that conservation efforts should be 
primarily focused on saving pandas in the wild. However, pandas that 
are already in captivity can serve a role in conservation of pandas in 
the wild. Captive pandas offer opportunities to conduct needed research 
and can help to educate people worldwide on the plight of pandas. Money 
generated from importing and exhibiting captive pandas can be used to 
fund in-situ panda projects. While in the past, the motivation for 
removing pandas from the wild was questionable, it is clear from the 
December 1996 studbook, that very few pandas have been removed from the 
wild in the past several years and the Captive Breeding Plan states 
that no additional wild-caught pandas are needed to sustain the captive 
population. The Service does not believe that importing captive pandas 
into the United States at this time under the final policy will lead to 
further removal from the wild. However, the Service will consider this 
when evaluating specific applications and not allow the import of 
pandas removed from the wild, except in exceptional circumstances. The 
Service would be remiss if it did not allow activities with captive 
pandas to occur, within the criteria of CITES and the ESA, that can be 
shown to benefit pandas in the wild.

Wild-Taken Pandas

    Issue: Several commenters did not believe the proposed use of 
December 31, 1986, as the cut-off date to be justified in light of 
current information on the limited removal of pandas from the wild and 
the under-represented founder stock of the captive population. Another 
commenter stated that they believed that the studbook data was 
incorrect and that the MOF was actually ``rescuing'' more pandas than 
was reflected in the studbook.
    Response: The Service agrees that caution should be used when 
considering imports of wild-caught pandas into the United States so 
loans will not stimulate further wild take. However, a number of the 
wild-caught pandas already in captivity have not bred and are very 
important genetic founders, as determined in the MOC/CBSG Workshop. The 
AZA Giant Panda SSP recognizes this as an area where U.S. zoos can use 
their specialized expertise. The Service agrees that this would be an 
appropriate issue for U.S. zoos to become involved in since pandas that 
are known breeders would most likely remain in China as part of the 
breeding program. Non-breeding pandas could potentially be exported to 
the United States to research why they were not breeding. Additionally, 
the MOC/CBSG Workshop report noted that no additional wild-caught 
pandas were needed to sustain the captive population based on the 
assumption that more captive pandas will become successful breeders. 
The Service changed the date to December 31, 1996, to coincide with the 
MOC/CBSG Workshop date based on information from the workshop, 
including the updated studbook showing few recent wild-caught pandas 
being added to the captive population, and on the previous information 
from China on rescue guidelines. At this time, the Service has no 
evidence that the studbook information is incorrect. Should information 
become available through genetic research to show that more wild-caught 
animals have been added to the captive population in recent years, the 
Service will consider revising this section of the policy. Since each 
import of a panda will be evaluated on a case-by-case basis, the 
Service still reserves the right to deny the import of a wild-caught 
animal, regardless of when it was removed from the wild, if the Service 
determines that the removal from the wild may have been detrimental to 
the species. It is unlikely that the Service would be able to make the 
necessary finding to issue a permit to import any pandas ``rescued'' 
from the wild after December 31, 1996, since it was concluded that 
these pandas are not needed for captive population maintenance. 
Recently ``rescued'' pandas should remain in China to either be 
returned to the wild or used in their captive-breeding program.

Age and Other Parameters of Animals Available for Loans

    Issue: Several commenters agreed with the Service's proposal that 
post-breeding age pandas not be considered for import due to risks 
associated with transport. Several other commenters disagreed, 
indicating there is no data to support the proposal.
    Response: The Service agrees there is a lack of data on the risk of 
transporting pandas over the age of 20, and therefore did not set an 
upper age limit for pandas to be imported into the United States. 
Additionally, since current research is not focused on aging in pandas, 
this may be one area that U.S. institutions may want to conduct 
research. The Service feels it should not eliminate the possibility of 
doing this type of research in the United States. The Service will, 
however, consider age as a factor in determining issuance of a permit 
as it relates to the proposed purpose of import on a case-by-case 
basis. Regardless of age, the Service agrees that, except in an 
emergency situation where there is no reasonable alternative medical 
care available, infirm animals should not be imported unless the 
medical condition has improved to the point that transport will not 
further compromise the health of the panda nor interfere with the 
purpose of the import.

Length of Loans

    Issue: Several commenters were opposed to short-term loans, in 
particular for exhibition purposes. Another commenter felt length of 
loans should be a function of permit purposes and flexibility should be 
allowed in

[[Page 45844]]

order to accomplish the proposed activities in a reasonable period of 
time.
    Response: The Service feels the language in the proposed policy 
allows flexibility but appropriately ties the length of the loan to the 
proposed purpose of the import. Thus, the language in this section has 
not been revised.

Enhancement and Conservation Benefits of Specific Projects

    Issue: The MOC pointed out that China does not have one national 
program for the conservation of the panda but both their agency and MOF 
have panda conservation programs.
    Response: The Service has clarified the language in this notice.
    Issue: The Service received a number of comments on the proposed 
distribution of net profits ranging from agreement with the proposed 
policy to suggestions on different ways to divide the net profits, 
including not designating a ratio. One commenter thought the policy 
should not require all net profits be used for panda conservation only. 
Another thought China should decide how funds are used.
    Response: The Service agrees there should be some flexibility in 
how net revenues are used for panda conservation but also strongly 
believes that in-situ conservation should remain the central focus to 
panda recovery. The Service has changed the policy to read that a 
significant portion (rather than 80 percent) of all revenue related to 
the holding of the pandas, not just net profits, should go to in-situ 
panda conservation. Because there appeared to be some confusion in the 
comments regarding the source of funds so allocated, the Service has 
also changed the language in the policy to clarify this issue. To make 
the required findings under the ESA and CITES, and work toward the 
recovery of the giant panda, the Service believes that all panda funds 
should be used for panda conservation. The Chinese government and the 
applicant select the projects to be funded in the loan agreement. The 
policy clarifies that the Service will consider whether these are 
priority projects in panda plans developed by the Chinese.
    Issue: One commenter stated that it was unreasonable to assume that 
any movement of giant pandas generates funds and this part of the 
policy concerning non-Chinese pandas be omitted. Several commenters 
suggested that the criterion of ownership for allocation of funds be 
dropped.
    Response: The Service does not agree that it is unreasonable to 
assume that any movement of pandas generates funds. The Service would 
agree that putting pandas on exhibit may not result in an increase in 
profit per se, but there have not been any imports which demonstrate 
this. However, there are many examples showing that pandas on exhibit 
generate revenue. Since the Service is changing the policy language for 
pandas belonging to China to be more flexible, there would be little 
difference in the distribution of revenue for the display of pandas 
from China and for display of pandas from non-Chinese institutions. 
Because of this, the Service has decided to eliminate the distinction 
between pandas owned by China and pandas belonging to other entities. 
The final policy states that a significant portion of all revenues for 
any panda import should be used for in-situ conservation of pandas in 
the wild with the remainder being used for either in-situ or ex-situ 
panda conservation projects.
    Issue: One commenter suggested that the Service clarify the 
relationship between the Enhancement section and the Primarily 
Commercial section by combining the sections or sequencing them to more 
clearly acknowledge the ties between the two sections.
    Response: The Service agrees and revised the policy language to 
better explain these relationships. In order to validate the CITES 
finding that the import is not for primarily commercial purposes, the 
policy outlines that any net profit, over the time of holding the 
animal(s), should be used to fund panda conservation projects in China. 
In addition, the use of net profits and loan agreement monies to fund 
conservation projects is part of the findings under the ESA, which 
requires that the import benefit the conservation of the species in the 
wild. The Service believes that to reach conservation and enhancement 
of pandas in the wild, all funds generated by pandas should be used for 
pandas and not directly for other species. The Service also continues 
to believe that permittees need to track net profits and project status 
to ensure the integrity of the original findings.
    Issue: Commenters both supported and opposed the proposed policy 
requirement to monitor progress of projects funded for panda 
conservation in China.
    Response: The Service believes the use of funds in meaningful panda 
conservation activities in China is a key means to help reach 
conservation and enhancement under the ESA and the ability to verify 
that this is being met is crucial. Therefore, the Service did not alter 
the requirements in this section of the policy.
    Issue: One commenter noted that there are several types of in-situ 
conservation projects that should be the highest priorities for support 
from panda loan revenue, including the National Survey scheduled to 
begin in 1998.
    Response: The Service agrees that priority should be given to 
funding the National Survey and urges institutions to strongly consider 
funding this effort during their negotiations to obtain pandas. The 
Service also agrees that it may be useful to utilize panda revenues to 
integrate field staff into projects and to support field educational 
activities and will consider this when reviewing giant panda import 
applications.

Scientific Research

    Issue: One commenter stated that scientific research on panda 
reproduction should be conducted only in the wild, not in zoos or 
artificial study facilities. Other commenters stated that the policy 
should recognize the expertise and capability outside of China that can 
be used to assist the international effort.
    Response: The Service believes there are studies which can be 
conducted on captive animals that would provide information useful in 
studying or managing wild panda populations. Captive pandas should be 
utilized to the greatest extent possible to benefit the wild 
populations. Scientific research both in China and the United States is 
one area where this can happen.
    Issue: Two commenters thought the proposed policy was too intrusive 
and burdensome. The requirements exceed the Service's goal of ensuring 
that applicants are engaging in valid and needed research and could 
cause delays or limit research. Two commenters supported the Service's 
detailed requirements.
    Response: The Service believes an applicant must clearly show that 
the scientific research is bona fide and will contribute to the 
conservation of the panda, particularly in the wild. This information 
is similar to information researchers routinely submit to receive other 
research grant funds and is information that a scientist needs to 
conduct a valid investigation. The Service needs to be informed of 
major procedural changes in the research since the granting of an 
import permit for scientific research is based on a particular research 
proposal. Radical changes in a scientific investigation could be reason 
for suspending a permit if the research no longer contributes to panda 
conservation. The Service will make every effort to evaluate any 
proposed changes in a research program

[[Page 45845]]

in a timely manner so research is not interrupted, but it is also 
important for the permittee to alert the Service to changes as soon as 
possible.
    Issue: One commenter suggested that milk be added to urine, feces, 
and synthetic DNA as substances that would not require a permit for 
export or import, when collected as outlined in the proposed policy. 
Another commenter indicated that until another decision is made by the 
Conference of Parties to CITES, the Secretariat considers urine, feces, 
and synthetic DNA as covered by CITES.
    Response: The Service has not included milk in this short list of 
exempted by-products at this time since, for the most part, it cannot 
be obtained without manipulating an animal. The Service has written the 
Secretariat outlining the U.S. position on urine, feces, and synthetic 
DNA and recognizes that some countries may require permits for these 
products. That is why the policy recommends that people contact the 
foreign CITES Management Authority to meet their requirements.
    Issue: One commenter disagreed that facilities to house pandas 
needed to be separate and apart from the public exhibition facility as 
there is no evidence that exhibition would interfere with research and 
it could be extremely costly. Another commenter stated that a recipient 
zoo should provide adequate off-exhibit space in which to conduct 
research.
    Response: In considering the comments, the Service changed the 
policy to no longer require housing or research areas totally separate 
and apart from the exhibition areas, but the applicant/permittee should 
have adequate housing away from public view should the Service 
determine that exhibition of the pandas is not compatible with the 
research.

Captive Breeding

    Issue: One commenter strongly agreed with the need to: (1) 
Coordinate the movement of captive-held pandas internationally since 
the captive-breeding effort in China is not currently self-sustaining 
and (2) enhance captive propagation efforts, with special emphasis on 
unrepresented founders, particularly males.
    Response: The Service continues to believe that breeding of 
captive-held/captive-born pandas needs to be coordinated 
internationally. The MOC/CBSG Workshop held in December 1996 in Chengdu 
is an excellent step toward this goal.
    Issue: One commenter recognized the concerns of the Service about 
the role of captive breeding but felt requiring a detailed breeding 
protocol was unnecessary and intrusive. Another commenter stated that 
since the policy requires all applicants to be members of a coordinated 
international effort, the Service should defer to those coordinated 
efforts (AZA programs and SSPs) to ensure that an institution has the 
necessary facilities and expertise to import a panda.
    Response: The Service needs to be assured that any applicant 
wishing to import a giant panda for breeding has the necessary 
knowledge, expertise and facilities to accomplish their goal. In order 
to be more flexible, the Service will accept a statement that the 
applicant is following the AZA Giant Panda SSP recommendations for 
breeding protocols in lieu of submitting the actual protocol. However, 
the Service will still require submission of facility and exhibit 
information in the form of photographs, diagrams, and written 
description with each application.
    Issue: One commenter did not agree that the name, position, and 
qualifications of the individual making the decision to take animals 
off display must be supplied but thought that this decision should be 
made by the institution's animal managers.
    Response: The Service agrees that the submission of this 
information is not necessary and has removed the language from the 
policy.

Exhibition

    Issue: A majority of the commenters supported Alternative 1 which 
proposed to allow imports for exhibition solely as an ancillary 
component. One commenter, while generally supporting this alternative, 
also recommended that the Service recognize the role of exhibition in 
raising revenues necessary to support conservation efforts.
    Response: The Service selected Alternative 1 for the final policy. 
Although exhibition typically cannot be the sole purpose of an import, 
the Service expects it will be a component of most applications and the 
funds raised will be considered when making the enhancement finding 
under the ESA.

Primarily Commercial

    Issue: One commenter stated that the Service does not have the 
authority to propose that all net profits resulting from the import of 
a panda for long term captive-breeding loans be used for the 
conservation of pandas in the wild; the Service should recognize that 
long term breeding loans are inherently not for primarily commercial 
purposes and that the intended purpose of the loan, to save the giant 
panda, is non-commercial.
    Response: The Service has the authority to propose how net profits 
should be used, since this is a part of the not for primarily 
commercial purposes and conservation/enhancement findings. The Service 
does not have enough information at this time to conclude that long 
term breeding loans are inherently not commercial. The intent to save 
giant pandas does not necessarily mean that an institution would not 
also want to generate revenue while contributing to the panda 
conservation effort. Historically, the exhibition of pandas has 
generated much public interest and short-term loans have generated much 
revenue for the institution exhibiting them. There has only been one 
long term loan undertaken and it has only been in effect for little 
over a year. Until more experience is gained, the Service needs to 
review each application for import and receive information, in the form 
of accounting for profit, to satisfy itself that the initial finding 
that the import was not for primarily commercial purposes remains valid 
for long term loans.
    Issue: One commenter was concerned about the degree of specificity 
applied to allowable expenses and suggested language to clarify 
reasonable expenses.
    Response: The Service agrees that these recommendations will 
provide additional flexibility and has incorporated them into the 
policy. The clarifying changes do not affect the Service's ability to 
review the data submitted and to ensure that its finding that the 
permitted activity is ``not for primarily commercial purposes'' remains 
accurate.
    Issue: Two commenters felt that to make the not-for-primarily 
commercial finding requires an initial determination concerning the 
overall purpose as well as a need for ongoing review in order to be 
satisfied that those purposes are being met. One commenter added that 
the same measures for compliance with CITES have to be met for each and 
every applicant.
    Response: The Service agrees with this evaluation which is 
reflected in the policy.
    Issue: Commenters sought clarification of the term ``indirect 
revenues.'' One of these commenters suggested that since the proposed 
policy used only direct expenses, the final policy should use a similar 
approach for calculating revenue. Commenters also stated that the 
Service should clarify that the cost of the loan is included in 
reasonable expenses. One commenter

[[Page 45846]]

added that the cost of technology transfer programs and education 
programs in the United States also be included.
    Response: The Service agrees with the above and has changed the 
policy.
    Issue: Two commenters stated that it will be extremely difficult 
for an institution, over long periods of time, to accurately assess the 
exact ``net profits'' related to a panda loan.
    Response: The Service agrees that it may be difficult to assess 
exact net profits over time, but reasonable information is necessary to 
continue to assess that the import is not for primarily commercial 
purposes.
    Issue: One commenter believed that exhibition of pandas for 
whatever purpose remains ``primarily commercial'' and thus falls under 
the restriction applied to CITES Appendix-I listings.
    Response: The Service does not agree that exhibition of pandas 
should automatically be determined primarily commercial. It is true 
that exhibition of pandas generates revenue, but if no net profits are 
generated or if net profits are generated but are used for conservation 
of the affected species, the Service can conclude that the import was 
not for primarily commercial purposes.
    Issue: Several commenters suggested language changes to help 
clarify the intent of the section on internal accounting systems.
    Response: The Service agrees with these suggestions and has revised 
the policy accordingly.
    Issue: One commenter felt the proposed policy was too restrictive 
in requiring approval from the Service if the permittee changes the 
conservation projects to be funded from those presented in their 
application; this requirement was unnecessary and appears to intrude in 
the internal affairs of a sovereign nation since all conservation 
projects are to be high priorities of the China's National Plan.
    Response: To make the findings under the ESA and CITES, the Service 
needs to consider whether the funds will be used to support priority 
conservation projects identified by the Chinese government in the 
National Plan, National Survey or Captive Breeding Plan. The Service 
sees this as a way to support China's management of pandas. Requiring 
permittees to obtain approval from the Service if they change the 
conservation projects to be funded ensures that funds are going to 
priority projects identified by the Chinese government in these plans.
    Issue: One commenter recommended that reports only be required on a 
multiple-year basis, such as every five years. Another commenter 
recommended that the Service carefully review and monitor financial 
reports annually to determine whether the commercial test is actually 
being met, and that the policy provide for possible adjustments in 
conservation funding commitments based on actual panda-related income.
    Response: The Service believes that it is important to review the 
information on primarily commercial before too much time elapses and 
has retained the requirement for an annual report.
    Issue: One commenter was concerned by the level of what they 
considered to be micro management; suggested the Service is not 
equipped to deal with the internal accounting procedures and annual 
reports as proposed in the policy; and thought the use of marketing 
data (such as visitors surveys) would be a more productive way to 
obtain information on revenue earned due to exhibition of giant pandas.
    Response: The Service feels that the collection of this level of 
information has been useful in evaluating the current permit held by 
the San Diego Zoo. The Service agrees that marketing data such as 
visitation monitoring is also important to collect since it allows for 
more accurate calculation of how much revenue a facility is generating 
because of pandas and has revised the policy.
    Issue: One organization stated that the disparate treatment 
business corporations are subjected to under the current policy for 
``short-term exhibition only'' loans should have no place in a final 
policy dealing with long term captive-breeding loans. They added that 
it is the intended use of the species, not the tax status of the 
applicant, that should be of concern and that the Service should not 
impose a higher burden of proof on business corporations to engage in 
long term captive-breeding loans under the AZA plan. Another commenter 
stressed that the difficulty for commercial entities is inherent in the 
treaty language itself; since commercial entities have as a fundamental 
purpose the pursuit of profit, assurances will be sought from profit-
making entities just as from non-profit entities that the requirements 
of CITES are being met in an ongoing manner.
    Response: The Service views ``for-profit'' (business corporations) 
institutions as having a more difficult time in satisfying the burden 
of proof, since they are founded with the purpose of making a profit 
and have additional factors, such as a fiduciary duty to stockholders, 
that must be addressed in the finding that an import is not for 
primarily commercial purposes. The captive breeding example in 
Resolution Conf. 5.10 specifically mentions the need to account for 
benefits to stockholders.
    Issue: One commenter cited WWF v. Hodel, Civ. No. 88-1276 (D.D.C. 
1988) as evidence that the Service acknowledged that CITES does not 
require the types of restrictions that the proposed policy applies in 
connection with the issue of commercialism. Another commenter stated 
that they are also well aware of this case and pointed out that the 
position taken by DOI on commercialism was in fact rejected by the 
Court in that matter.
    Response: In World Wildlife Fund v. Hodel, District Judge Johnson 
found that the Service had failed to articulate the reasons supporting 
its ``implicit'' finding that the importation of giant pandas by the 
Toledo Zoo for short-term exhibition purposes ``was not primarily for 
commercial purposes.'' Judge Johnson, after determining that the 
additional fee charged by the Toledo Zoo for the public to view the 
pandas was ``significant to a consideration of the CITES requirement 
that the import was not primarily for commercial purposes'', issued a 
preliminary injunction against the Toledo Zoological Gardens to prevent 
the collection of such additional fees. While Judge Johnson's ruling 
did not prescribe a firm boundary between those activities that are 
primarily commercial in nature from those that are not, her ruling did 
correctly identify the responsibility of the Service to explain the 
basis of its permitting action with particular emphasis on statutory 
and treaty-based requirements and criteria. In dealing with complex 
permitting questions like those covered by this policy, it is the 
Service's goal that decisions be made on the basis of complete 
administrative records and fully explained records of decision. This 
policy was intended to achieve that goal, especially on the complex 
findings and determinations that must be made as a prerequisite to 
issuing any import permits for giant pandas.

Suitability of Facilities and Care

    Issue: One organization commented that their experience with pandas 
has led to the realization that exercise and open space may be much 
more important for the well-being of pandas than had previously been 
thought. The suitability of facilities and care should be directly 
associated with the purposes of the permit.
    Response: The Service agrees the suitability of facilities and care 
is tied directly with the purposes of the permit.

[[Page 45847]]

In addition, the amount of open space or opportunities for pandas to 
exercise will be considered during review of permit applications when 
deciding whether permit issuance criteria under CITES and the ESA are 
met.
    Issue: One commenter did not understand why the Service needs to 
know the existence of adjacent roads to the panda facility and urged 
this requirement be deleted.
    Response: At the time the proposed policy was written, the Service 
was concerned about the impact of traffic noises on panda behavior. 
Since then, the Service has received information from facilities 
holding pandas that pandas are unaffected by routine traffic noises. 
Thus, this has been deleted from the policy.
    Issue: One commenter suggested that the Service require that the 
importer account for the animals' psychological, behavioral, and 
physical needs while housed prior to, after, and during transport. 
Additionally, a veterinarian with expertise in panda well-being should 
be required to travel with any imported animal to ensure direct and 
immediate care throughout the trip.
    Response: Importers of pandas are required to ship the animals 
under humane and healthful conditions and follow the regulations on 
providing care, food, and water during transport (50 CFR Part 14, 
Subpart J). The Service agrees that it is a good idea for a 
veterinarian or other animal care personnel with expertise in panda 
care to accompany pandas. In the past, China has required Chinese 
caretakers to accompany pandas in transit. Since the Service is not 
aware of any problems that have occurred during prior shipments of 
pandas, the Service does not believe it is necessary to change the 
policy at this time.

Transfer of Pandas to Other Entities Within the United States

    Issue: One commenter did not understand the grounds for requiring 
an interstate commerce permit to transfer loaned giant pandas to other 
entities within the United States.
    Response: Under the ESA, the transfer of a giant panda to another 
institution across state lines constitutes interstate commerce, and 
therefore requires an ESA permit, since it is expected that the 
receiving facility gains financially or otherwise by having that animal 
at their facility. The Service has a long-standing policy that 
legitimate non-commercial breeding loans do not need interstate 
commerce permits because they generally do not involve the transfer of 
specimens in the pursuit of gain or profit. However, panda loans 
present exceptional facts that require the recipient of any panda 
transfer to address all the elements of the panda policy and interstate 
commerce permits would be required for any interstate transfer since 
exhibition of giant pandas generate much public interest and monetary 
gain for the exhibiting institution.
    Issue: One organization commented that it is burdensome and 
decreases the flexibility in a breeding program to require an applicant 
to indicate in the import application any intended transfers of the 
pandas within the United States at a later time.
    Response: The Service agrees that an importer may not be able to 
project whether the pandas they wish to import would need to be moved 
to another facility at a later date and has deleted the requirement to 
anticipate interstate movement prior to import under the policy. 
However, the subsequent transfer of a panda will need to meet the 
provisions of the policy through an interstate commerce permit or 
intrastate transfer authorization from the Service as conditioned under 
the import permit. This is to ensure that all transfers meet the 
approval of the Chinese government or the entity that owns the animal 
and meet the purposes of the original import under CITES and the ESA.

Required Determinations

    Issue: One organization stated that Executive Order 12866 requires 
any significant regulatory action be reviewed by the Office of 
Management and Budget. The Executive Order defines ``significant 
regulatory action'' to include those actions which ``* * * raise novel 
legal or policy issues arising out of legal mandates, the President's 
priorities, or the principles set forth in this Executive Order.'' 
Section 1(a) of the order states: ``The Regulatory Philosophy. Federal 
agencies should promulgate only such regulations as are required by law 
* * * or are made necessary by compelling public need, such as material 
failures of private markets to protect or improve * * * the environment 
* * *'' Based on the definition of ``significant regulatory action'' 
and Section 1(a), the commenter asserted that the Service's proposed 
policy should be subject to OMB review. They further stated that their 
comments on the proposed policy question whether the ``primarily 
commercial purposes'' standards the Service proposes ``are required'' 
by law, and whether there is a compelling public need for the policy 
based on ``* * * material failures of private markets to protect or 
improve * * * the environment * * *'' The commenter believes that the 
``private market'' of zoological institutions, and specifically in this 
case the AZA, has protected and continues to protect endangered species 
like the panda through non-governmental captive-breeding programs.
    Response: While the Service believes that this action is a policy 
and not a rule, it has followed the Administrative Procedures Act, the 
Regulatory Flexibility Act, and Executive Order 12866. The policy sets 
out guidance that is intended to assist the decision-makers and staff 
within the Service to carefully review applications for panda import 
permits, to ensure that all statutory and treaty-based criteria have 
been addressed and fully explained in the administrative record, and, 
assuming that these goals are met, to thereby enhance the conservation 
of the giant panda. The policy does not prescribe new restrictions or 
limitations of general application to those who would apply for such 
permits, but instead sets out a ``road map'' on how to develop and 
submit a complete application in light of the best available scientific 
information available to the Service at this time. No regulatory impact 
analyses are required by law for the adoption of this statement of 
agency policy. Even if such analyses were required, nothing in this 
policy could be construed to impose an economic impact that does not 
already exist as a result of the ESA and CITES.

Other Issues

    Issue: One commenter pointed out that CITES Notification No. 932 
(Loans of Giant Pandas) does not carry forward the implied criticisms 
of captive breeding outside of China contained in the CITES Standing 
Committee document, Doc. SC.36.15. The notification explicitly 
recognizes that there may well be a role for institutions outside of 
China for captive breeding. The repeal of Notification No. 477 removes 
any open criticism by the Secretariat or the Standing Committee of 
captive breeding, especially as this purpose relates to commercialism.
    Response: The Service agrees that Notification No. 932 recognizes 
the export of giant pandas for captive breeding under specific 
circumstances, and believes this has come about because of the positive 
changes in panda conservation efforts in China and elsewhere.
    Issue: One commenter believed that reasonable assumptions on the 
question of commercialism can be drawn from the Notification and Doc. 
SC.36.15. The first assumption is the Secretariat's view that the giant 
panda is not actually or

[[Page 45848]]

currently threatened by international trade. The second assumption is 
that panda loans can be made in accordance with the normal provisions 
of CITES. All that is necessary in addressing commercialism is 
application of the standard provisions of Conf. 5.10.
    Response: The Service agrees. The Secretariat also cautioned that 
care needs to be taken that the money offered to China reflect the real 
value of pandas to that institution and are not a ``token gesture,'' 
with the bulk of the monies being retained by the institution itself 
for its own benefit. The Secretariat noted that the latter would be 
incompatible with the requirement that imports of Appendix-I species be 
for purposes which are not primarily commercial.
    Issue: One commenter stated that the application of the CITES 
standard to only export Appendix-I animals in exceptional circumstances 
should not be confused with the subjective and limited definition, when 
there is a high degree of probability of captive breeding taking place. 
Another commenter added that the emphasis should be on the ``best 
interest of the whole species.''
    Response: The Service believes that Section 3.c of Notification No. 
932 should be interpreted to mean that breeding age animals should only 
be exported to institutions either in potential breeding pairs or 
singly to facilities that already have breeding age panda(s). This is 
further qualified by limiting exports to institutions that cooperate 
with others in a breeding program. The Service does not believe that 
this would exclude the possibility of exporting animals that have not 
bred in China to a United States breeding program, such as AZA's Giant 
Panda SSP, in which the focus is to research why these pandas have not 
successfully bred.
    Issue: One commenter stated that the Service does not have the 
authority to implement Notification No. 932 and the proposed policy 
itself can only be implemented and enforced as a formal Service 
regulation adopted after rulemaking procedures.
    Response: The Service has discretion to formulate policy that 
defines or clarifies how to interpret or implement already existing 
regulations, in this case 50 CFR Parts 13, 17, and 23 for a particular 
species.
    Issue: One commenter stated they were very concerned by the 
negative impact this policy has had on commercial entities in their 
desire to help panda conservation through long term breeding loans that 
would result in in-situ financial contributions and captive breeding 
research in the United States.
    Response: The Service recognizes that commercial institutions can 
potentially make significant contributions toward conservation programs 
for endangered species. However, in the case of all Appendix-I imports, 
including giant panda imports, the Service is obligated to determine 
that the import is not for primarily commercial purposes. Commercial 
entities must be able to show that they will not economically gain by 
the import over time, before the Service can approve an import permit. 
These types of institutions could still contribute financially to panda 
conservation, without importing the animals, if they chose to do so.
    With publication of this policy, the Service lifts the suspension 
of the review and processing of permit applications to import live 
giant pandas, which has been in place since December 20, 1993. The 
policy is effective immediately to allow organizations that have, or 
are finalizing, loan agreements with China to apply without further 
delay. Accordingly, we have good cause under 5 U.S.C. 533(d) to waive 
the 30-day effective date. Applicants should allow at least 120 days 
for the processing of an application. This time frame includes a notice 
in the Federal Register of the availability of each application for a 
30-day public comment period as required under the ESA.

Required Determinations

    The information collection requirements identified in this policy 
as part of the permit application have been approved by the Office of 
Management and Budget under the Paperwork Reduction Act, 44 U.S.C. 3501 
et seq. and assigned clearance number 1018-0093. OMB has reviewed this 
document under Executive Order 12866.
    The Service has determined that this policy is categorically 
excluded under Departmental procedures from complying with the National 
Environmental Policy Act (NEPA) (516 Departmental Manual, Ch. 2, Appx. 
1, paragraph 1.10). An Environmental Action Memorandum is on file at 
the Service's Office of Management Authority in Arlington, Virginia.

Policy on Import of Giant Pandas

    Given the long history and controversial nature of the issue of 
giant panda imports, the Service considers the conservation status of 
the giant panda sufficiently unique to warrant establishment of a 
separate policy on the import of giant pandas. The policy sets out 
guidance that is intended to assist the decision-makers and staff 
within the Service to carefully review applications for panda import 
permits, to ensure that all statutory and treaty-based criteria have 
been addressed and fully explained in the administrative record, and, 
assuming that these goals are met, to thereby enhance the conservation 
of the giant panda. The policy does not prescribe new restrictions or 
limitations but instead sets out a ``road map'' on how to develop and 
submit a complete application in light of the best scientific 
information available to the Service at this time.
    Before a decision is made on any application for a permit to import 
or engage in interstate commerce in giant pandas, the Service must 
review the application in terms of the applicable requirements of CITES 
and the ESA. Issuance of an import permit under CITES requires prior 
findings that: (1) The proposed import would not be for purposes 
detrimental to the survival of the species; (2) the import would not be 
for primarily commercial purposes; and (3) the permit applicant is 
suitably equipped to house and care for the animals. Issuance of a 
permit under the ESA requires prior determinations that, among other 
things: (1) The activity would be for scientific purposes or to enhance 
the propagation or survival of the species, in a manner consistent with 
the purposes and policies of the ESA; and (2) issuance of the permit 
would not be likely to jeopardize the continued existence of the 
species. These requirements are further implemented by application 
requirements and issuance criteria found in 50 CFR 13.12, 17.22, 23.14, 
and 23.15. In addition, Section 9(d) of the Lacey Act, with regulations 
at 50 CFR 14, Subpart J, requires that shipments of live wild mammals 
being shipped to the United States are done under humane and healthful 
conditions such that the animals arrive alive, healthy, and uninjured.
    This policy provides guidance on Service consideration of these 
requirements relative to the giant panda only. These considerations and 
this policy are in no way intended to apply to import permit 
applications for other species. All such applications must continue to 
demonstrate that the proposed imports meet the applicable requirements 
of CITES and the ESA consistent with the conservation status of the 
particular species in question and the best scientific information 
available for that species.

[[Page 45849]]

Purposes

    The primary goal of the policy is to ensure that all permitting 
decisions involving the transfer of giant pandas into and within the 
United States contribute toward the survival, and ultimately the 
recovery of panda populations in the wild. The long term goal is to 
have all captive-holders of giant pandas cooperate in one international 
plan. Toward that goal, all transfers should be part of a coordinated 
panda conservation effort, a term used in this policy to mean an 
organized effort through which all giant panda movements support high 
priority projects in China's National Plan, National Survey, or Captive 
Breeding Plan. If an import or transfer has breeding as one of its 
purposes, the institution should also coordinate their activities with 
China's Captive Breeding Plan and must participate in AZA's Giant Panda 
SSP or a similar plan approved by the Service, as required generally 
under existing regulations. The Service anticipates that most permit 
applications will be for multiple purposes. Applicants must identify 
the primary purpose for the proposed import or interstate transfer and 
all other intended purposes. No activities for additional purposes 
should be undertaken after issuance of a permit without prior approval 
from the Service since issuance of the permit would be based on the 
purposes identified in the initial application.
    The ultimate objective of managing captive pandas should be for 
research or research/breeding purposes, and any training or use of 
pandas in animal acts would detract from this objective. Therefore, use 
of pandas in animal acts or shows most likely would not meet the 
current permit issuance criteria in the regulations and is discouraged 
under this policy.

Wild-Taken Pandas

    The following criteria would be used when evaluating import 
applications involving pandas removed from the wild. These temporal 
criteria are based on information available to the Service suggesting 
that the removal of pandas from the wild has increasingly come under 
Chinese control, starting prior to the WWF Plan of August 1989.
    In all cases, the Service continues its policy of approving import 
permit applications only when it is sure that the import did not, or 
will not, contribute to the removal of pandas from the wild.
    1. For wild-taken pandas, those removed from the wild prior to 
December 31, 1996, would be considered eligible for inclusion in an 
import permit.
    2. Pandas removed from the wild after December 31, 1996, are not 
likely to be eligible for inclusion in an import permit, in part 
because the MOC/CBSG Workshop report states that no additional wild-
caught pandas are needed to have a self-sustaining captive population.

No Detriment Finding Under CITES

    Under CITES Article III.3(a), the import of any specimen of a 
species included in Appendix I requires a finding by the country of 
import that the import will be for purposes that are not detrimental to 
the survival of the species. This finding must be made within the 
context of the fundamental principle that trade in specimens of 
Appendix-I species must only be authorized in exceptional 
circumstances. This finding is made on a case-by-case basis, and is 
governed by the best available scientific information and the status of 
the species involved, both in captivity and the wild. The finding also 
considers whether the intended purposes cannot be achieved by other 
means (better alternative uses for the animals). Relative to imports of 
giant pandas, this finding will focus on ensuring that an import will 
not adversely affect wild populations by directly or indirectly causing 
the removal of animals from the wild either for the specific import 
under consideration or by creating a perception that additional imports 
will be authorized. The finding will also consider the purpose for 
import to ensure that it contributes to improving the conservation 
status of the species.

Age and Other Parameters of Animals Available for Importation

    1. The Service will consider the age of the pandas and how it 
relates to accomplishing the proposed activities.
    2. The Service also will consider how each specific panda relates 
to accomplishing the proposed activities and how it was selected to 
ensure the import will not interfere with China's research and breeding 
programs.
    3. Except in an emergency situation where there is no reasonable 
alternative medical care available, an infirm animal will not be 
allowed to be imported unless transport will not further compromise the 
health of the panda or interfere with the purposes of the import.

Humane Shipment and Transport

    Any giant panda shipped to the United States must comply with the 
regulations in 50 CFR Part 14, Subpart J: Standards for the Humane and 
Healthful Transport of Wild Mammals and Birds to the United States. 
Shipments of pandas by air must meet the International Air Transport 
Association's Live Animal Regulations. The Service will evaluate 
proposed shipping containers to ensure that live pandas shipped to the 
United States arrive alive, healthy, and uninjured and that 
transportation occurs under humane and healthful conditions.

Length of Loans

    In situations where the movement of the panda is part of a loan 
agreement, the Service will evaluate the length of time requested for 
the loan to ensure it is appropriate to the proposed activity. The 
length of the loan should be of sufficient duration to accomplish the 
stated goals. It is anticipated that such activities may require 3 to 5 
years, or longer, to produce research results for the maximum benefit 
for captive-breeding activities or to produce research results that 
benefit captive and wild populations

Section 7 Consultation Under the ESA: No Jeopardy Finding

    Under section 7 of the ESA, the Service is required to insure that 
its permit action to allow import, export, and interstate or foreign 
commerce involving giant pandas is not likely to jeopardize the 
continued existence of that species. The Service will conduct 
consultation which will conclude with issuance of a biological opinion 
stating whether the proposed action is or is not likely to jeopardize 
the continued existence of the giant panda. A biological opinion will 
be prepared for each permit application.
    Each biological opinion will include a description of the proposed 
action and take into consideration the status of the giant panda in 
China, the status of the giant panda in captivity (domestic and 
international), the effects of the action, and the cumulative effects 
of the action. If it is determined that the proposed action is likely 
to jeopardize giant pandas, reasonable and prudent alternatives would 
be recommended to avoid jeopardy. In the event no reasonable and 
prudent alternatives are available, the Service will not issue the 
permit.
    If a specific biological opinion concludes the proposed permit is 
not likely to jeopardize giant pandas, an incidental take statement 
will be provided to address the anticipated incidental take, if any, 
that would result from the permit issuance. In addition, the incidental 
take statement would include terms and conditions to

[[Page 45850]]

minimize the impact of incidental take. Such terms and conditions would 
also be incorporated into the ESA permit.

Enhancement and Conservation Benefits of Specific Projects

    Enhancement of the propagation or survival of a species and 
conservation benefits for scientific research under the ESA can be 
achieved through the following: (1) The proposed activities must 
ultimately benefit pandas in the wild, and (2) all funds should be used 
for giant panda conservation including habitat protection or captive 
breeding efforts, with a significant portion of all funds being used 
for in-situ conservation projects for the giant panda. Both of these 
elements should be met to address the conservation/enhancement finding.
    1. Whenever funding (import or loan agreement, fundraising money, 
and net profits) is associated with the import or transfer of giant 
pandas, the following should be addressed:
    (a) Conservation projects to be funded should address the 
following:
     They should be included in China's National Plan, National 
Survey, or Captive Breeding Plan and should be formally approved by 
China's Project Office of MOF, MOC, or other appropriate entity.
     They should be considered a high priority in the most 
recent Plan.
     They should be described as specifically as possible, with 
funding allocations to specific tasks given in foreign currency (e.g., 
yuan) and in U.S. dollars, and projected timeframes given for use of 
the funds to initiate and complete specific projects or activities.
     Conservation projects that do not meet the above criteria 
will be considered by the Service, if compelling reasons are given.
     Any change in conservation projects to be funded once a 
permit is granted would be considered an amendment and would need prior 
approval of the Service.
    (b) The applicant should provide a plan to monitor the disbursement 
of funds for selected conservation projects or activities. The plan 
needs to be sufficiently complete so that the Service is satisfied of 
its effectiveness and is assured the projects will be completed. Such a 
monitoring plan should include provisions equivalent to the following:
     Before funds are transferred to the appropriate office in 
China or the lending entity, the permittee and the appropriate foreign 
entity should agree on a detailed budget, work plan, and timetable for 
project completion. Specific, measurable objectives and a schedule for 
progress reports should be identified for each project.
     Payments should be made in installments. Each payment 
needs to be linked to actions taken toward completion of the 
project(s).
     Subsequent payments should be contingent on approval of 
progress reports by the permittee.
     An assessment should be conducted annually to verify 
progress toward project implementation.
     The permittee should have permission from the Chinese 
implementing agency or lending entity for the permittee, an authorized 
representative, and the Service to examine records and to make site 
visits to funded projects at least annually if needed.
    (c) Funds (import or loan agreement money, fund raising money, and 
net profits) associated with the import/transfer of giant pandas should 
be allocated for panda conservation as follows (see Primarily 
Commercial Purposes for additional discussion of net profits):
     A significant portion of the funds should be used for in-
situ conservation projects for the giant panda and its habitat in China 
as listed in China's National Plan, National Survey, or Captive 
Breeding Plan.
     The remaining funds should be used to support panda 
conservation including breeding or educational efforts for the giant 
panda in China or additional in-situ projects or, if the panda 
originated in a country outside of China, panda conservation projects 
outside of China.
     In the event that funds generated exceed the ability of 
the Chinese to apply the monies to priority projects or captive 
breeding in China at any one time, then funds may be used to support 
breeding efforts for the giant panda outside China.
     The allocation of funds for other uses than outlined above 
will be considered by the Service if compelling reasons are given.
     Any change in allocation of funds once a permit is granted 
would be considered an amendment and would need prior approval of the 
Service.
    2. If neither the payment of money nor the generation of revenue 
are associated with the import or transfer of live pandas, the 
applicant should provide information to the Service to show 
convincingly that the results of the proposed activities will 
contribute significantly to the conservation of the panda in the wild.
    3. Annual reports to the Service will be required, which should 
give an accounting and report of funds transferred and portions of the 
conservation project completed (see Primarily Commercial Purposes for 
further reporting requirements). Copies of reports received by the 
applicant from the recipient of funding should be included, with 
English translations if reports are not in English.
    The policy considerations concerning the enhancement and 
conservation benefits in this Section and in the related sections on 
the types of activities for which a permit can be issued--Scientific 
Research, Biological/Scientific Samples, Captive Breeding, and 
Exhibition--would be used by the Service relative to the giant panda 
only. These considerations and this policy are in no way intended to 
apply to import permit applications for other species. All such 
applications must continue to demonstrate that the proposed imports 
meet the applicable requirements of the ESA and CITES consistent with 
the conservation status of the particular species in question and the 
best scientific information available for that species.

Scientific Research

    One of the purposes of the ESA is to provide a means whereby the 
ecosystems upon which endangered and threatened species depend may be 
conserved. The ESA defines ``conservation'' as the use of all methods 
and procedures which are necessary to bring an endangered or threatened 
species to the point it no longer needs to be protected by the ESA. 
There is a great need for scientific research on the giant panda, both 
in the wild and in captivity to help achieve this goal. If permits are 
issued for imports of live animals for a combination of research and 
captive breeding, the proposed research must contribute to panda 
conservation but may be more focused on captive populations.
    1. The applicant must provide information to show that the research 
is bona fide, meaning research that is properly designed using the 
scientific method, and can be accomplished with the expertise and 
resources available. This should include:
     Objectives and goals should be clearly defined in the 
research protocol. Hypotheses and experimental designs intended to test 
them should be described. Any subsequent substantive procedural changes 
and/or additions must be pre-approved by the Service. The Service will 
review changes in a timely manner so as not to disrupt the research as 
applicable.
     Investigative procedures and research protocols should be 
described in detail or referenced as published in

[[Page 45851]]

a recognized refereed, peer-review journal.
     Estimated time frames need to be given.
     Research should not be duplicative unless it is a 
collaborative effort, or if repetition can be justified.
     The results of the research would be expected to identify, 
evaluate, or resolve panda conservation problems or contribute to the 
basic knowledge of panda biology and ecology deemed important to the 
survival of the panda.
     The research results would likely be published in a 
recognized refereed, peer-reviewed scientific journal.
    2. The applicant must have the expertise and resources to 
accomplish the stated objectives of the proposed research, and describe 
how the research would not conflict in any way directly or indirectly 
with known conservation programs for that species. For research with 
live pandas:
     Research should be recognized as a high priority activity 
in China's National Plan, National Survey, or Captive Breeding Plan.
     The proposal should describe how the study may contribute 
to the conservation of the giant panda in the wild. If portions of the 
research are in-situ, the research must be a collaborative effort with 
Chinese scientists. For any ex-situ portion of the research, the 
applicant should describe why it is best conducted outside China, and 
how any information gained or methodologies developed will be 
transferred for use in China, including estimated time frames of 
transfers, training, or collaborative efforts.
     Any physically invasive procedures to be used or any 
behavioral modifications anticipated as part of research activities 
should be described.
     The permittee must provide an annual report summarizing 
research activities associated with the purposes of the permit, 
including a brief description of each project, a copy of protocols 
developed and methodologies used, a summary of data collected with a 
discussion of results and copies of published papers resulting from the 
research. The report must also indicate whether the research resulted 
in the development of protocols or other methodologies, if the products 
were transferred to the Chinese government, and how they have been or 
will be used for giant panda conservation.
    3. If live pandas are going to be on exhibition at any time during 
the term of the research project, the following should be addressed:
     The applicant should provide protocols outlining how the 
research and exhibition will be monitored to ensure that having the 
pandas on exhibit is not interfering with the research or biasing data. 
In lieu of submitting the protocol, the applicant may cite the 
protocols of the AZA Giant Panda SSP or other relevant breeding plan.
     The applicant must have adequate facilities to conduct the 
research and provide information on alternative facilities to house the 
pandas away from public exhibition in case it is found that exhibition 
interferes with the research. The off-exhibit space, in addition, 
should be large enough to provide an adequate exercise area should 
panda(s) need to be housed there on a long term basis.

Biological/Scientific Samples

    Permits for import of panda biological samples can be issued for 
scientific research (including, but not limited to, genetic research, 
monitoring of health status and diagnosis of disease or other 
pathological conditions, physiological and behavioral research, 
assessment of contaminant loads, and gene banking).
    For research involving biological samples, the applicant should 
have the expertise and resources to accomplish the stated objectives:
     Salvaged specimens (i.e., those obtained from animals that 
have died of natural causes; naturally shed hair; deposited scent gland 
secretions) should be obtained without harassing any live animals, and 
collection must be authorized by the MOF, MOC, or the Project Office or 
the owner of the panda if not owned by China.
     Any invasive sampling or sample collection involving 
restraint of the animals should be done by qualified personnel (as 
determined by the applicant), preferably veterinarians, with 
appropriate training and experience in capture, restraint, and sample 
collection, so as not to result in death or injury of animals. 
Collection of samples, including semen specimens, that involve the use 
of general anesthesia generally may be imported if collected by 
individuals who possess appropriate expertise in anesthesia of giant 
pandas so that risk to the animals is minimized, and in the case of 
semen, persons collecting specimens should also possess appropriate 
expertise in electro-ejaculation techniques for giant pandas. Invasive 
sampling or sample collection involving restraint of wild pandas, 
including semen collection, is limited generally to situations 
resulting from capture activities conducted for another purpose 
approved by MOF authorities and should not involve any type of 
remuneration for the collection of the samples. Animals should not be 
captured for the sole purpose of collecting samples.
     The results of research conducted with imported specimens 
must be reported to the Service at least annually; a report should 
include copies of any scientific publications produced. The report 
should contain information on the number and type (e.g., blood, hair, 
skin biopsy) of samples imported, specific source/location from which 
each sample was collected (if more than one was authorized), and brief 
observations on the effects of sampling on the animals. The report 
should also indicate whether the research resulted in the development 
of protocols or other methodologies, if the products were transferred 
to the Chinese government, and how they have been or will be used for 
giant panda conservation.
     Permits to import samples to monitor or determine 
reproductive status or to import semen for use in captive breeding may 
be issued. Imports of semen from China should be coordinated with 
China's Captive Breeding Plan, the AZA Giant Panda SSP, or other 
coordinated panda conservation plan approved by the Service. Imports of 
semen from countries other than China must also be done in accordance 
AZA's Giant Panda SSP (or other plan) but may not require specific 
written approval from China.
     The import or export of urine, feces, and synthetic DNA, 
when collected in a manner that does not involve the capture, 
detention, or killing of protected wildlife, does not require a permit 
from the Service. The CITES Management Authority of any exporting or 
importing country should be contacted to meet any requirements it may 
have.

Captive Breeding

    Any captive breeding conducted with imported pandas needs to 
benefit panda conservation by supplementing the breeding program in 
China to achieve a self-sustaining captive population (as outlined in 
the MOC/CBSG Workshop report), and typically provide a source of funds 
for panda conservation in the wild. There may be a need to maximize the 
use of pandas currently held in captivity that are not essential to 
China's Captive Breeding Plan. The Service expects that most of the 
pandas made available for import into the United States will be ones 
that have not successfully bred in China. Thus, at this time, the 
Service finds that captive breeding for the sole purpose of producing 
offspring is not sufficient to satisfy the enhancement requirement of 
the ESA. This policy therefore stresses the need for any permit 
applications

[[Page 45852]]

involving captive breeding to include a research component that will 
benefit panda conservation.
    1. If the applicant intends to conduct captive breeding of imported 
pandas, in addition to the research requirements, the applicant should 
provide sufficient information to demonstrate the necessity of 
importing pandas for captive breeding:
     Enhancement may be partially satisfied through captive 
breeding if it can be convincingly shown that results will be used to 
study and/or manage giant pandas in a way that contributes to panda 
conservation. The application or request will be expected to include a 
research component aimed at increasing reproductive success especially 
if the animals involved have a history of being non-breeding animals. 
It is expected that requests to import live giant pandas for captive 
breeding will also include other enhancement activities, such as the 
generation of funds for panda conservation in the wild.
     The proposed captive breeding should be part of a 
coordinated panda conservation effort designed to complement 
conservation efforts for the wild panda population and the applicant 
must actively participate in the AZA's Giant Panda SSP or a similar 
plan approved by the Service.
     The captive breeding program should coordinate with 
China's Captive Breeding Plan and should demonstrate how it will 
contribute to the preservation of the panda's gene pool (i.e., 
retention of maximum genetic diversity). The choice of individuals to 
be imported should be based on scientific management of the captive 
populations with genetic and demographic criteria used to determine 
mating pairs.
     Applications for panda movements should describe how the 
study would contribute to the conservation of the giant panda in the 
wild or in captivity, and how any information gained or methodologies 
developed will be for use in China, including estimated time frames of 
transfers, training, or collaborative efforts.
    2. The applicant should provide information to show that he/she has 
the expertise and resources to accomplish the stated objectives:
     The applicant should submit a detailed breeding protocol 
that outlines when male and females will be paired for breeding, how 
females and males will be visually and physically separated and/or 
managed together, with layout of facilities and protocols for rearing 
potential young. In lieu of submitting the protocol, the applicant 
could show they are using the protocol of the AZA Giant Panda SSP. 
However, the Service will still request submission of facility and 
exhibit information in the form of photographs, diagrams and written 
description with each application.
     Artificial insemination or any other physically invasive 
procedures should be described, and any subsequent substantive 
procedural changes and/or additions must be pre-approved by the 
Service.
     The permittee must provide quarterly updates and an annual 
report summarizing breeding and research activities, including a copy 
of protocols developed and methodologies used, a summary of data 
collected with a discussion of results, and copies of any published 
papers. The report should also indicate whether the activities resulted 
in the development of protocols or other methodologies, if such 
products were transferred to the Chinese government, and how they have 
been or will be used for giant panda conservation.
    3. If pandas are going to be on exhibition at any time during the 
captive-breeding loan:
     The applicant should provide protocols outlining how the 
captive breeding, its research component, and exhibition will be 
monitored to ensure that having the pandas on exhibit does not 
interfere with captive breeding and/or its research component.
     The applicant must have adequate facilities to conduct the 
captive breeding and its research and provide information on 
alternative facilities to house the pandas away from public exhibition 
in case it is found that the exhibition interferes with the captive 
breeding or research. The off-exhibit area should provide sufficient 
space for exercise should pandas need to be housed there long term.
     The applicant must consent to the movement, substitution, 
or transfer of any panda to another approved institution if, in the 
judgment and at the request of the Chinese government or the SSP Panda 
Coordinator, such action is needed to maximize successful captive-
breeding opportunities.

Exhibition

    1. The import of giant pandas for the sole purpose of educational 
exhibition would not be sufficient to satisfy enhancement requirements. 
The Service expects institutions importing giant pandas to educate the 
U.S. public about the ecological role and conservation needs of the 
giant panda, but will not consider this as an adequate justification 
for issuing a permit. However, if an applicant is developing a panda 
conservation education program that would be transferable to the 
Chinese government, or is developing a program specifically for use in 
China, particularly in localities near giant panda habitat and 
reserves, the Service will consider this project as part of a 
coordinated conservation effort in making its enhancement finding.
     Educational programs in China should be aimed at local 
people, school children, panda researchers (field and captive), reserve 
biologists, and managers and should be in conjunction with the full 
cooperation of the Chinese authorities.
     Educational activities or projects should be described in 
detail, including samples of the kinds of educational materials to be 
used and a description of evaluation methods.
     The messages conveyed through the educational program 
should stress historical and contemporary impacts on the status of the 
giant panda in the wild and conservation efforts that might be required 
to halt the species' decline and degradation of its habitat.
    2. Educational displays would only be allowed as an ancillary 
component of a research or research/captive-breeding program. However, 
if an applicant intends to exhibit the panda(s), educational display(s) 
should be developed and implemented to educate the U.S. public about 
the ecological role and conservation needs of the giant panda. 
Specifically, the import of pandas solely for exhibition loans is 
discouraged.

Primarily Commercial Purposes

    With regard to the determination of whether an import of giant 
pandas is not to be used for primarily commercial purposes, the Service 
will utilize the following policy.
    1. Resolution Conf. 5.10 of the Conference of Parties to CITES 
provides that:
     The nature of the transfer of specimens between the owner 
in the country of export and the recipient in the country of import may 
be commercial. It is the intended use of the specimens in the country 
of import that must not be for primarily commercial purposes, and it is 
the responsibility of the recipient country's Management Authority to 
make this determination.
     There may be some commercial aspects of that use, but the 
non-commercial uses must predominate in order to be deemed primarily 
non-commercial.
    2. Any public, private, non-profit, or commercial (profit-making) 
institutions, organizations, and agencies will receive consideration 
for applications for the

[[Page 45853]]

importation of pandas. The Service's general regulations at 50 CFR 
10.12 define ``public'' institutions as those that ``* * * are open to 
the general public and are either established, maintained, and operated 
as a government service, or are privately endowed and organized but not 
operated for profit.'' Although commercial organizations may also 
choose to apply for an import permit, the orientation of such 
organizations to carry out transactions in the pursuit of gain or 
profit would make it more difficult for the Service to find that the 
specimen proposed for import is not to be used primarily for commercial 
purposes. As in all cases, the burden rests with the applicant to show 
that this CITES requirement is satisfied.
    3. The Service's policy is that all net profits should be used for 
panda conservation in China, with a significant portion of such funds 
being used for in-situ conservation (see Enhancement and Conservation 
Benefits of Specific Projects). Net profits include all funds or other 
valuable considerations (including enhanced value of common stock 
shares) received or attained by an institution or related organization 
(including any commercial parent organization of the applicant, but not 
including unrelated private entities, such as hotels, not associated 
with the applicant) as a result of the panda import, to the extent that 
such funds or other valuable considerations exceed the reasonable 
expenses that are properly attributable to the proposed activities 
(e.g., exhibition).
     Reasonable expenses would include, but are not limited to, 
the following: Facility construction if amortized for the entire 
proposed length of stay for the imported animal(s); cost of the 
importation agreement; facility maintenance; and direct labor and 
operating expenses and supplies needed for the care of the pandas and 
necessary to conduct research or research/captive-breeding activities 
that have been identified in the application.
     In making decisions on panda import permit applications, 
the Service's goal would be to maximize funds going back to 
conservation projects in China and, as such, costs associated with 
ordinary operations, such as advertising, general personnel costs, 
general legal expenses (not directly related to the panda import), 
would not be considered reasonable expenses unless they can be shown to 
be necessary to sustain the conservation purpose of the import.
     Collection of revenues generated by import of the panda by 
the importing institution (e.g., gate receipts, food and drink sales, 
tourist souvenirs), either for its own use or for the use of other 
organizations, for purposes other than those previously described 
ordinarily would be judged to be a primarily commercial activity, as 
would the use of revenues for profit-making purposes.
     Monitoring of visitation and other means of tracking 
monies earned as a result of panda activities should be employed by the 
institution to assist in gathering data used to calculate net profits.
    4. Each applicant for a panda import, in satisfying the applicable 
requirements of 50 CFR subchapter B, must submit a detailed plan for 
the allocation of all funds raised in excess of expenses (net profits), 
as a result of the panda import. The application should also include a 
statement from a licensed, independent certified public accountant 
stating that the applicant's internal accounting system is sufficient 
to account for and track funds generated directly by the panda import, 
and for the subsequent disbursement of funds.
    5. Each recipient of a permit to import pandas is required, in 
accordance with 50 CFR 13.45, to submit an annual report to the Service 
as a condition of the permit. The annual report must contain a full 
accounting of all funds raised directly by the institution or related 
organization, the reasonable expenses incurred and the portion of the 
funds raised that is in excess of these expenses, and what portion of 
these funds are to be disbursed for giant panda conservation projects 
or activities as outlined in the prior section, Enhancement and 
Conservation Benefits of Specific Projects. A description of the method 
used to calculate net profits and categories of expenses and revenues 
(including enhanced stock value, if applicable) must also be included 
in the report.
     The report should include names of people involved, 
location of the activities, a brief description of each project and 
assessment of project implementation, and the amount and use of money 
being provided the project.
     Conservation projects other than those projects presented 
in the application must receive approval from the Service prior to 
allocating funds.
     If applicants wish to protect the specific dollar amounts 
submitted in their annual report from disclosure under the Freedom of 
Information Act, they should indicate this in the report along with a 
reasonable justification to withhold confidential business information.
    These policy considerations would be used by the Service only for 
determining whether panda imports are primarily commercial in nature. 
They are not intended to apply to Appendix-I import permit applications 
for other species. All such applications must continue to demonstrate 
that the proposed import meets the general requirements of CITES 
Article III to satisfy the ``not to be used for primarily commercial 
purposes'' test.

Suitability of Facilities and Care

    Under CITES, the Service must be ``satisfied that the proposed 
recipient of a living specimen (to be imported) is suitably equipped to 
house and care for it.'' Under the regulations implementing the ESA, 
the Service must determine that the applicant has ``* * * The 
expertise, facilities, or other resources * * * to successfully 
accomplish the objectives * * *'' To aid in satisfying these 
requirements, applicants should provide the following information in 
addition to the information required in 50 CFR 17.22:
     Copies of protocols for monitoring general health and 
behavior. In lieu of new protocols, an applicant may submit copies of 
protocols recommended by a coordinated panda conservation effort, 
including the AZA Giant Panda SSP.
     Diagrams and photographs clearly depicting all enclosures 
where the panda may be housed, including any off-exhibit areas and 
panda holding area(s) in relation to other facilities.
     Information to demonstrate the applicant has adequately 
consulted with other facilities that have successfully held pandas in 
recent years, that the applicant has facility features that address the 
National Zoological Park's recommended measures for giant panda care 
and facilities, and that zoo staff, especially keepers and 
veterinarians, have had proper training and experience to care for 
pandas.
     Approval of facilities by the Chinese or appropriate 
authority in the lending country, if such a stipulation has been made 
in a contractual agreement.

Transfer of Pandas to Other Entities Within the United States

    Transfer of pandas already in the United States may be allowed as 
part of a scientific research or research/captive-breeding program but 
should address all of the considerations noted in this policy. Pandas 
may be displayed as long as it does not interfere with breeding or 
research. The proposed recipient of the panda transferred between 
states will need to apply for and receive an interstate commerce permit 
under the ESA prior to the transfer since the recipient would 
potentially gain

[[Page 45854]]

financially by having pandas at their facility and/or are being held 
under a loan (e.g., lease-hold agreement) from China or other lending 
entity. The proposed recipient of the panda will need to provide all 
the information required by the ESA, its regulations, and this policy 
in order for the Service to make its findings prior to issuance of a 
permit. The Service will facilitate, to the extent possible, the 
transfer of animals within the United States when it is part of a 
coordinated research or research/breeding program. If the receiving 
institution has a panda permit on file with the Service, it can 
reference the permit number and information in this file, and provide 
any new information for the Service to review in consideration of an 
interstate commerce permit. Because applications will be published in 
the Federal Register, the applicant will need to allow at least 90 days 
for processing. Since transfers must also have the prior approval of 
the Chinese government or the entity that owns the animals, a permittee 
must have prior approval of the Service to transfer pandas within a 
state, and the proposed recipient should address all of the 
considerations noted in this policy. The number of times an individual 
panda is transferred within the United States will be closely monitored 
by the Service to protect the overall health and well-being of the 
animal.
    This notice was prepared under the authority of the Endangered 
Species Act of 1973, as amended (16 U.S.C. 1531 et seq.).

    Dated: June 22, 1998.
Jamie Rappaport Clark,
Director, U.S. Fish and Wildlife Service.
[FR Doc. 98-23074 Filed 8-26-98; 8:45 am]
BILLING CODE 4310-55-P