[Federal Register Volume 65, Number 23 (Thursday, February 3, 2000)]
[Rules and Regulations]
[Pages 5278-5283]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-2284]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 679

[Docket No. 991210331-0017-02; I.D. 102899B]
RIN 0648-AN34


Fisheries of the Exclusive Economic Zone off Alaska; Inshore Fee 
System for Repayment of the Loan to Harvesters of Pollock from the 
Directed Fishing Allowance Allocated to the Inshore Component Under 
Section 206(b)(1) of the American Fisheries Act (AFA)

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

ACTION:  Final rule.

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SUMMARY:  NMFS issues final regulations implementing an inshore fee 
system for all pollock harvested under the inshore component (IC) of 
the Bering Sea/Aleutian Islands directed fishing allowance under 
section 206(b)(1) of the AFA. The AFA authorized a $75 million loan to 
reduce fishing capacity for offshore component (OC) pollock and an 
inshore fee system as the means of repaying the loan. The proceeds of 
the loan partly paid the cost of removing nine OC catcher-processors 
from all commercial fishing in the U.S. exclusive economic zone (EEZ). 
The intent of this rule is to implement the inshore fee system.

DATES:  This final rule is effective February 10, 2000.

ADDRESSES:  Copies of the Environmental Assessment, Regulatory Impact 
Review, and Final Regulatory Flexibility Analysis (EA/RIR/FRFA) may be 
obtained from Michael L. Grable, Chief, Financial Services Division, 
NMFS, 1315 East-West Highway, Silver Spring, MD 20910. Comments 
involving the reporting burden estimates or any other aspects of the 
collection of information requirements contained in this final rule 
should be sent to both Michael L. Grable, at the above address, and to 
the Office of Information and Regulatory Affairs, Office of Management 
and Budget (OMB), Washington, D.C. 20503 (ATTN: NOAA Desk Officer). 
Comments sent by e-mail or the Internet will not be accepted.

FOR FURTHER INFORMATION CONTACT:  Michael L. Grable,
    (301) 713-2390.

SUPPLEMENTARY INFORMATION:

Background

    The President signed the AFA into law on October 20, 1998, as part 
of the Omnibus Appropriations Bill for fiscal year 1999 (Pub. L. 105-
277). The AFA required the Federal Government to pay, not later than 
December 31, 1998, $90 million to the owners of nine large catcher 
processors harvesting OC pollock. In return, eight of these vessels had 
to stop all commercial fishing in the EEZ immediately and be scrapped 
by December 31, 2000. Although the ninth vessel did not have to be 
scrapped, it also had to stop all commercial fishing in the EEZ 
immediately and the owner had to certify that neither the owner nor 
anyone who purchased the vessel from the owner intended to use the 
vessel outside the EEZ to harvest any fish that also occur within the 
EEZ.
    On December 30, 1998, NMFS paid the required amount to the owners 
of these vessels. In accordance with the AFA, NMFS paid $15 million of 
this amount from an AFA appropriation and the remaining $75 million 
from the proceeds of a fishing capacity reduction loan under sections 
1111 and 1112 of Title XI of the Merchant Marine Act, 1936 (46 U.S.C. 
App. 1279f and g) (Title XI). The AFA requires the loan to be repaid by 
fees under section 312(d)(2)(C) of the Magnuson-Stevens Fishery 
Conservation and Management Act (16 U.S.C. 1861a(d)(2)(C)) (Magnuson-
Stevens Act).
    Upon payment of the $90 million, NMFS revoked all nine vessels' 
domestic fishing permits, one owner provided the certificate required 
for the ninth vessel, and the other owners began preparing for 
scrapping the remaining eight vessels. All eight vessels are presently 
undergoing scrapping. Scrapping is scheduled to be completed before 
December 31, 2000.
    Under the AFA and section 312(d)(2)(C) of the Magnuson-Stevens Act, 
all vessel owners harvesting IC pollock (fish sellers) are required to 
pay the fee and all parties making the first ex-vessel purchase of IC 
pollock (fish buyers) are required to collect the fee and account for 
and forward the fee revenue to NMFS for the purpose of repaying the 
loan. The fish sellers pay, and the fish buyers collect, the fee when 
the fish buyers deduct the fee from the ex-vessel value of all IC 
pollock before paying the net ex-vessel value of the fish to the fish 
sellers.
    The fee is six-tenths (0.6) of one cent for each pound, round-
weight, of all IC pollock that fish sellers land. The AFA provides that 
fee payment and collection shall begin on or after January 1, 2000. 
Under this final rule, the fee must be paid and collected for all 
landed fish that were harvested after February 10, 2000.
    Although the loan's scheduled maturity is 30 years, the AFA also 
provides that fee payment and collection ``shall * * * continue without 
interruption until such loan is fully repaid * * *'' (section 
207(b)(2)). Whether the loan is repaid before, at, or after its 
scheduled maturity depends on when fee payment begins, the rate at 
which loan principal bears interest, annually determined total 
allowable pollock catches after December 31, 1999, and IC pollock 
allocations after December 31, 2004.
    NMFS has determined the loan's principal will bear interest under 
the statutory formula at the rate of 7.09 percent per annum. Under the 
AFA, the loan's interest rate is 2 percent plus the percentage rate of 
interest that the U.S. Treasury charges NMFS for the $75 million that 
NMFS borrowed from the U.S. Treasury. The latter percentage rate is 
5.09 percent.
    The other variables controlling the time required to fully repay 
the loan are not presently determinable. Several assumptions are, 
consequently, necessary to project how long repayment will take. The 
first assumption involves the time at which fee payment begins. For 
projection purposes, NMFS assumes that the fee will be paid on all IC 
pollock harvested in calendar year 2000 and in each year thereafter 
until the loan is fully repaid. The second assumption involves the 
annual total allowable catch (TAC) of pollock after December 31, 1999, 
which

[[Page 5279]]

may vary from year to year. For projection purposes, NMFS assumes that 
the average annual TAC of pollock after December 31, 1999, will be the 
same as the average annual TAC of pollock over the 14-year period from 
the beginning of 1985 through end of 1998. This was 2.769 billion 
pounds, which equals 1.256 million metric tons. The third assumption 
involves IC pollock allocations after December 31, 2004. This depends 
on whether the North Pacific Fishery Management Council maintains IC 
pollock allocations after December 31, 2004, at the same level as IC 
pollock allocations under the AFA from January 1, 1999, to December 31, 
2004. The AFA level is 42 percent of TAC. For the purposes of this 
projection, NMFS assumes that IC pollock allocations after December 31, 
2004, will be at the same level as IC pollock allocations from January 
1, 1999, to December 31, 2004.
    Under these 3 assumptions, the loan will be repaid in 21 years. 
This is 9 years less than the loan's scheduled maturity. Actual 
conditions different than those NMFS assumes for the purpose of this 
projection may, however, cause loan repayment to occur sooner or later 
than here projected. Future TAC may be the biggest determinate of the 
time actually required to repay this loan.
    Under this rule fee payment and collection begin on February 10, 
2000 and continue without interruption until the loan is fully repaid, 
without regard to whether this is a period longer or shorter than the 
loan's scheduled maturity of 30 years.
    On December 30, 1998, NMFS disbursed all $75 million of the loan's 
original principal amount. Interest at the rate of 7.09 percent per 
annum has been accruing since that date. NMFS will apply all fee 
receipts, first, to the payment of accrued interest and, second, to the 
reduction of loan principal.
    Section 312(b)-(e) of the Magnuson-Stevens Act provides for fishing 
capacity reduction programs, which may be funded by loans under 
sections 1111 and 1112 of Title XI. Although the IC pollock loan is 
authorized by the AFA rather than by section 312(b)-(e) of the 
Magnuson-Stevens Act, the AFA specifies that the IC pollock loan is 
repayable under section 312(d)(2)(C) of the Magnuson-Stevens Act. NMFS 
has already proposed a framework rule for implementing section 312(b)-
(e) of the Magnuson-Stevens Act (64 FR 6854, February 11, 1999). The 
proposed framework rule would establish detailed provisions for paying, 
collecting, disbursing, accounting for, and reporting about fees 
repaying fishing capacity reduction loans.
    NMFS had hoped to implement the fishing capacity reduction 
framework rule before NMFS had to provide for payment and collection of 
the IC pollock fee. NMFS intended to provide for payment and collection 
of the IC pollock fee by making the loan subject to the framework rule 
provisions about fee payment and collection. Because NMFS has not yet 
adopted and promulgated the framework rule, however, NMFS must now 
separately provide for payment and collection of the IC pollock fee by 
adding a temporary subpart G to 50 CFR part 679 (subpart G). NMFS has 
drawn most of the procedural provisions of subpart G from the proposed 
framework rule. After a framework rule is adopted and promulgated, NMFS 
will revoke subpart G and concurrently provide, by a program 
implementation rule under the framework rule, for the continuing 
payment and collection of the IC pollock fee.
    This action adds subpart G to 50 CFR part 679 establishing 
regulations to implement an inshore fee system for IC pollock. The 
proposed regulations which preceded this action were published on 
December 21, 1999 (64 FR 71396-71400), with a public comment period 
that ended on January 5, 2000.
    NMFS received comments from 2 entities. The following summarizes 
the comments and gives NMFS' responses.

Comments and Responses

    Comment 1: One comment questioned the necessity of setting up a 
separate account for the collected funds and suggested that fee 
payments be made from a regular corporate account.
    Response: This is the first loan that will be repaid from fees 
generated by a fishery resource. We believe that it is important to the 
fish sellers who will repay this loan that we maintain the credibility 
of the collection process. Separate accounts are preferable because the 
fee receipts can be easily segregated from the fish buyer's normal cash 
flows. We also want to reduce the administrative costs of the loan 
collection process and separate accounts will make the audit process 
simpler and less expensive.
    Comment 2: One comment asked if it would be possible for NMFS to be 
authorized to make regular wire transfer withdrawals from the separate 
account instead of the company sending in a check each month.
    Response: We do not believe it is possible to set up a system 
whereby NMFS could make regular wire transfer withdrawals for several 
reasons. The amounts deposited in the accounts will differ from month 
to month. If the account was simply swept to zero, there would be no 
way to differentiate between funds deposited and interest earned. The 
contractual mechanism we set up with the bank would have to be turned 
on or off as the seasons begin and end. We would also encounter 
administrative difficulties in making separate contractual agreements 
with the different banks used by the companies. Finally, the rule 
requires the fish buyer to provide a settlement sheet tied to the 
amount of money transferred. This would not be possible if the account 
was periodically swept.
    Comment 3: One comment questioned whether deposits into the 
separate account have to be made on a weekly basis or could be made 
biweekly or monthly.
    Response: As we discussed in our first response, it was incumbent 
upon us to set up a credible system to assure the fish sellers that 
their payments were applied against the loan accurately and on a timely 
basis. One way of achieving this credibility was to set up a system 
that segregates the collected funds from the fish buyer's normal cash 
flow. Ideally, such a system should require daily deposits. We 
attempted to be sympathetic to operational problems daily deposits 
would create for the fish buyers by allowing weekly deposits.
    Comment 4: One comment suggested a 5-day grace period before late 
payment penalties would be imposed.
    Response: NMFS has amended Sec. 679.64 of the final rule to allow a 
5-day grace period before late charges will accrue.
    Comment 5: One comment suggested a 2-week grace period for 
submission of the annual report.
    Response: NMFS has amended section 679.63 of the final rule by 
making the due date January 15, thereby providing a 2-week grace period 
after year end.
    Comment 6: One comment questioned the meaning of the term 
``business week'' for fee collection purposes, since the fishing 
industry does not operate on a normal Monday to Friday ``business 
week''.
    Response: NMFS has added a definition of ``business week'' in 
Sec. 679.60 which designates Friday as the end of a business week.
    Comment 7: One comment involved the effective date of the fee 
collection and suggested that fees should be paid for all inshore 
pollock harvested in 2000, regardless of when the fee system becomes 
effective.
    Response: NMFS is not authorized to collect any fees until this 
rule is

[[Page 5280]]

finalized. Although we made our best effort to have the system in place 
before the FY 2000 season starts, we were unable to do so.
    Comment 8: One comment sought the clarification of the rule to 
indicate that the fee and any future appropriations would be the 
exclusive source of loan repayment.
    Response: The proposed rule states that the fee shall be the 
exclusive source of loan prepayment. Future appropriations could over 
ride this.
    Comment 9: One comment suggested that any late charge or penalty 
should be the responsibility of the fish buyer.
    Response: NMFS agrees that the fish seller should not be obligated 
for any late charges and has added language in section 679.64 to 
clarify this point.
    Comment 10: One comment objected to the possibility that fish 
buyers may earn interest on fees paid by fish sellers.
    Response: State law may or may not permit such accounts to earn 
interest. If the accounts can earn interest, the time limitations on 
transferring the funds to the Government's lock box will allow for 
minimal interest accrual. Nevertheless, the fish buyers collecting will 
incur administrative expenses in the process. Any interest earned by 
fish buyers would help defray the administrative costs incurred.

Summary of Revisions

    The following sections of this final rule revise the proposed rule:
    (1) Section 679.60. This section has been amended to include a 
definition of ``business week'' which designates Friday as the end of a 
business week.
    (2) Section 679.61. This section is revised to state the loan's 
actual interest rate.
    (3) Section 600.63. This section is revised to change the due date 
for the annual report from December 31 to January 15, thereby 
effectively providing a 2-week grace period for submission of the 
annual report.
    (4) Section 679.64. This section is revised to provide for a 5-day 
grace period before late charges will accrue and to clarify that fish 
sellers should not be obligated for any late charges.
    The final rule further revises the proposed rule to increase 
brevity, clarity, accuracy, and/or sufficiency.

Classification

    The Assistant Administrator for Fisheries (AA), NMFS, determined 
that this final rule is consistent with the AFA, the Magnuson-Stevens 
Act, Title XI, and other applicable laws.
    This final rule has been determined to be not significant for 
purposes of Executive Order 12866.
    NMFS prepared a Final Regulatory Flexibility Analysis (FRFA) 
describing the impact of the action on small entities. In summary, the 
FRFA states that the rule would apply to about 100 fish sellers and 
about eight fish buyers. All of the fish sellers are small entities; 
none of the fish buyers are. The FRFA indicates that the average annual 
fee expense for each fish seller would likely be about $60,000. 
Recordkeeping and reporting requirements would fall primarily on the 
fish buyers, who collect the fee. The estimated annual compliance cost 
to fish buyers is about $5,568 per fish buyer. Several minimal 
recordkeeping and reporting requirements also apply to fish sellers. A 
fish seller must, for example, report to NMFS if a fish buyer refuses 
to collect the fee. The estimated compliance cost of this requirement 
is about $25 per report. In specific and limited circumstances when a 
fish seller becomes a de facto fish buyer for recordkeeping and 
reporting requirements, the estimated compliance cost is the same as a 
fish buyer's compliance cost. The Paperwork Reduction Act (PRA) 
discussion further details these costs. This final rule does not 
duplicate or conflict with any other Federal rules of which NMFS is 
aware.
    In the FRFA, NMFS considered two alternatives that might have 
lessened the economic impact on small entities. These alternatives were 
not collecting the fee and delaying fee collection. Not collecting the 
fee would both cost the Nation $75 million and violate the AFA. 
Delaying fee collection would increase the ultimate cost to fish 
sellers because interest would continue to accrue on an unreduced $75 
million principal balance. It would also prolong the time required for 
fish sellers to repay the loan because the AFA requires that the fee 
system remain in effect until the loan is fully repaid. The FRFA 
further discusses these alternatives and their economic impact on IC 
pollock fish sellers and fish buyers. Although no comments on the IRFA 
were received, public comments led to changes from the proposed rule 
that we believe will benefit affected entities, e.g., grace periods for 
submission of late charges and the annual report.
    The AA determined that there is good cause to waive the 30-day 
delay in effectiveness for this rule under 5 U.S.C. 553 (d)(3). While 
the AFA stipulates that an inshore pollock fee collection system be 
established by January 1, 2000, or thereafter, it is important to begin 
collecting the fee as early in the fishing season (which begins January 
20, 2000) as possible, to avoid confusion, to treat all landings 
similarly, and to minimize the accumulation of interest on the $75 
million loan. Therefore, the rule must be in effect as soon as 
practicable. NMFS believes that persons needing to comply with this 
rule should be afforded 7 calendar days to open accounts and otherwise 
prepare for the fee collection. The affected inshore fleet has been 
aware of the imposition of this fee in exchange for the buyout of 
certain factory trawlers for an allocation of catch since October 1998 
when the AFA was enacted. Delaying this rule beyond 7 days after 
publication would be contrary to the public interest and unnecessary.
    Notwithstanding any other provision of law, no person is required 
to respond to nor shall a person be subject to a penalty for failure to 
comply with a collection of information subject to the PRA requirements 
unless that collection of information displays a currently valid OMB 
Control Number.
    This final rule contains collection of information requirements 
subject to the PRA that have been approved by OMB under OMB Control 
Number 0648-0376. This PRA approval occurred in connection with 
proposal of the framework rule for implementing section 312(b)-(e) of 
the Magnuson-Stevens Act, including a collection of information burden 
for fee payment, collection, disbursement, accounting, and reporting 
under section 312(d)(2)(C) of the Magnuson-Stevens Act. The AFA 
provides that payment and collection of the IC pollock fee shall be in 
accordance with 312(d)(2)(C) of the Magnuson-Stevens Act.
    The estimated response times for this collection of information 
are: 10 minutes per fishing trip to maintain records on transactions, 2 
hours per fish buyer's monthly report, 4 hours per fish buyer's annual 
report, and 2 hours per fish buyer's or fish seller's report about fish 
sellers who refuse to pay, or fish buyers who refuse to collect, the 
fee.
    These estimated response times include the time needed for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and revising the collection 
of information.
    Send comments regarding this burden estimate or any other aspect of 
this collection of information, including suggestions for reducing this 
burden, to NMFS (see ADDRESSES) and to OMB (see ADDRESSES).

List of Subjects in 50 CFR Part 679

    Alaska, Fisheries, Reporting and recordkeeping requirements.


[[Page 5281]]


    Dated: January 28, 2000.
Penelope D. Dalton,
Assistant Administrator for Fisheries, National Marine Fisheries 
Services.
    For the reasons set out in the preamble, 50 CFR part 679 is amended 
as follows:

    1. The authority citation for 50 CFR part 679 continues to read as 
follows:

    Authority:  16 U.S.C. 773 et seq., 1801 et seq., and 3631 et 
seq.

    2. In Sec. 679.1, a paragraph (k) is added to read as follows:


Sec. 679.1  Purpose and scope.

* * * * *
    (k) This part also governs payment and collection of the loan, 
under the American Fisheries Act (AFA), the Magnuson-Stevens Act, and 
Title XI of the Merchant Marine Act, 1936, made to all persons who 
harvest pollock from the directed fishing allowance allocated to the 
inshore component under section 206(b)(1) of the AFA.

    3. A subpart G is added to read as follows:

PART 679--FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF ALASKA

Subpart G--Inshore Fee System for Repayment of the Loan to Harvesters 
of Pollock from the Directed Fishing Allowance Allocated to the Inshore 
Component Under Section 206(b)(1) of the AFA.
Sec.
679.60  Definitions.
679.61  Loan.
679.62  Fee payment and collection.
679.63  Fee collection deposits, disbursements, records, and 
reports.
679.64  Late charges.
679.65  Enforcement.
679.66  Prohibitions and penalties.

Subpart G--Inshore Fee System for Repayment of the Loan to 
Harvesters of Pollock from the Directed Fishing Allowance Allocated 
to the Inshore Component Under Section 206(b)(1) of the AFA.

    Authority:  Pub. L. 105-277, 16 U.S.C. 1801, et seq.


Sec. 679.60  Definitions.

    In addition to the definitions in the Magnuson-Stevens Act and in 
Sec. 679.1 of this title, the terms used in this subpart have the 
following meanings:
    American Fisheries Act (AFA) means Title II of Pub.L. 105-277.
    Borrower means (individually and collectively) all persons who, 
after January 1, 2000, harvest fee fish from the IC directed fishing 
allowance.
    Business week means a 7-day period, Saturday through Friday.
    Delivery value means the gross ex-vessel value of all fee fish at 
fish delivery.
    Deposit principal means all collected fee revenue that a fish buyer 
deposits in a segregated deposit account maintained in a federally 
chartered national bank for the sole purpose of aggregating collected 
fee revenue before sending the fee revenue to NMFS for repaying the 
loan.
    Fee means the six-tenths (0.6) of one cent that fish buyers deduct 
at fish delivery from the delivery value of each pound of round weight 
fee fish.
    Fee fish means all pollock harvested from the IC directed fishing 
allowance beginning on February 10, 2000 and ending at such time as the 
loan's principal and interest are fully repaid.
    Fish buyer means the first ex-vessel fish buyer who purchases fee 
fish from a fish seller.
    Fish delivery means the point at which a fish buyer first takes 
delivery or possession of fee fish from a fish seller.
    Fish seller means the harvester who catches and first sells fee 
fish to a fish buyer.
    IC directed fishing allowance means the directed fishing allowance 
allocated to the inshore component under section 206(b)(1) of the AFA.
    Loan means the loan authorized by section 207(a) of the AFA.
    Net delivery value means the delivery value minus the fee.
    Subaccount means the Inshore Component Pollock Subaccount of the 
Fishing Capacity Reduction Fund in the U.S. Treasury for the deposit of 
all funds involving the loan.


Sec. 679.61  Loan.

    (a) Principal amount. The loan's principal amount is $75,000,000 
(seventy five million dollars).
    (b) Interest. Interest shall, from December 30, 1998, when NMFS 
disbursed the loan, until the date the borrower fully repays the loan, 
accrue at a fixed rate of 7.09 percent. Interest shall be simple 
interest and shall accrue on the basis of a 365-day year.
    (c) Repayment. The fee shall be the exclusive source of loan 
repayment. The fee shall be paid on all fee fish.
    (d) Application of fee receipts. NMFS shall apply all fee receipts 
it receives, first, to payment of the loan's accrued interest and, 
second, to reduction of the loan's principal balance.
    (e) Obligation. The borrower shall repay the loan in accordance 
with the AFA and this subpart.


Sec. 679.62  Fee payment and collection.

    (a) Payment and collection. (1) The fee is due and payable at the 
time of fish delivery. Each fish buyer shall collect the fee at the 
time of fish delivery by deducting the fee from the delivery value 
before paying or promising later to pay the net delivery value. Each 
fish seller shall pay the fee at the time of fish delivery by receiving 
from the fish buyer the net delivery value or the fish buyer's promise 
later to pay the net delivery value rather than the delivery value. 
Regardless of when the fish buyer pays the net delivery value, the fish 
buyer shall collect the fee at the time of fish delivery;
    (2)(i) Each fish seller shall be deemed, for the purpose of the fee 
collection, deposit, disbursement, and accounting requirements of this 
subpart, to be both the fish seller and the fish buyer--and all 
requirements and penalties under this subpart applicable to both a fish 
seller and a fish buyer shall equally apply to the fish seller--each 
time that the fish seller sells fee fish to:
    (A) Any fish buyer whose place of business is not located in the 
United States, who does not take delivery or possession of the fee fish 
in the United States, who is not otherwise subject to this subpart, or 
to whom or against whom NMFS cannot otherwise apply or enforce this 
subpart,
    (B) Any fish buyer who is a general food-service wholesaler or 
supplier, a restaurant, a retailer, a consumer, some other type of end-
user, or some other fish buyer not engaged in the business of buying 
fish from fish sellers for the purpose of reselling the fish, or
    (C) Any other fish buyer who the fish seller has good reason to 
believe is a fish buyer not subject to this subpart or to whom or 
against whom NMFS cannot otherwise apply or enforce this subpart,
    (ii) In each such case the fish seller shall, with respect to the 
fee fish involved in each such case, discharge, in addition to the fee 
payment requirements of this subpart, all the fee collection, deposit, 
disbursement, accounting, recordkeeping, and reporting requirements 
that this subpart otherwise imposes on the fish buyer, and the fish 
seller shall be subject to all the penalties this subpart provides for 
a fish buyer's failure to discharge such requirements;
    (b) Notification. (1) NMFS will send an appropriate fee payment and 
collection commencement notification to each affected fish seller and 
fish buyer of whom NMFS has knowledge.
    (2) When NMFS determines that the loan is fully repaid, NMFS will 
publish a Federal Register notification that the fee is no longer in 
effect and should no

[[Page 5282]]

longer be either paid or collected. NMFS will then also send an 
appropriate fee termination notification to each affected fish seller 
and fish buyer of whom NMFS has knowledge;
    (c) Failure to pay or collect. (1) If a fish buyer refuses to 
collect the fee in the amount and manner that this subpart requires, 
the fish seller shall then advise the fish buyer of the fish seller's 
fee payment obligation and of the fish buyer's fee collection 
obligation. If the fish buyer still refuses to properly collect the 
fee, the fish seller, within the next 7 calendar days, shall forward 
the fee to NMFS. The fish seller at the same time shall also advise 
NMFS in writing of the full particulars, including:
    (i) The fish buyer's and fish seller's name, address, and telephone 
number,
    (ii) The name of the fishing vessel from which the fish seller made 
fish delivery and the date of doing so,
    (iii) The quantity and delivery value of fee fish that the fish 
seller delivered, and
    (iv) The fish buyer's reason (if known) for refusing to collect the 
fee in accordance with this subpart;
    (2) If a fish seller refuses to pay the fee in the amount and 
manner that this subpart requires, the fish buyer shall then advise the 
fish seller of the fish buyer's collection obligation and of the fish 
seller's payment obligation. If the fish seller still refuses to pay 
the fee, the fish buyer shall then either deduct the fee from the 
delivery value over the fish seller's protest or refuse to buy the fee 
fish. The fish buyer shall also, within the next 7 calendar days, 
advise NMFS in writing of the full particulars, including:
    (i) The fish buyer's and fish seller's name, address, and telephone 
number,
    (ii) The name of the fishing vessel from which the fish seller made 
or attempted to make fish delivery and the date of doing so,
    (iii) The quantity and delivery value of fee fish the fish seller 
delivered or attempted to deliver,
    (iv) Whether the fish buyer deducted the fee over the fish seller's 
protest or refused to buy the fee fish, and
    (v) The fish seller's reason (if known) for refusing to pay the fee 
in accordance with this subpart.


Sec. 679.63  Fee collection deposits, disbursements, records, and 
reports.

    (a) Deposit accounts. Each fish buyer that this subpart requires to 
collect a fee shall maintain a segregated account at a federally 
insured financial institution for the sole purpose of depositing 
collected fee revenue and disbursing the fee revenue directly to NMFS 
in accordance with paragraph (c) of this section.
    (b) Fee collection deposits. Each fish buyer, no less frequently 
than at the end of each business week, shall deposit, in the deposit 
account established under paragraph (a) of this section, all fee 
revenue, not previously deposited, that the fish buyer has collected 
through a date not more than 2 calendar days before the date of 
deposit. Neither the deposit account nor the principal amount of 
deposits in the account may be pledged, assigned, or used for any 
purpose other than aggregating collected fee revenue for disbursement 
to the subaccount in accordance with paragraph (c) of this section. The 
fish buyer is entitled, at any time, to withdraw deposit interest, if 
any, but never deposit principal, from the deposit account for the fish 
buyer's own use and purposes.
    (c) Deposit principal disbursement. On the last business day of 
each month, or more frequently if the amount in the account exceeds the 
account limit for insurance purposes, the fish buyer shall disburse to 
NMFS the full amount of deposit principal then in the deposit account. 
The fish buyer shall do this by check made payable to ``NOAA Inshore 
Component Pollock Loan Subaccount.'' The fish buyer shall mail each 
such check to the subaccount lockbox account that NMFS establishes for 
the receipt of the disbursements of deposit principal. Each 
disbursement shall be accompanied by the fish buyer's settlement sheet 
completed in the manner and form that NMFS specifies. NMFS will specify 
the subaccount's lockbox and the manner and form of settlement sheet by 
means of the notification in Sec. 679.62(b)(1).
    (d) Records maintenance. Each fish buyer shall maintain, in a 
secure and orderly manner for a period of at least 3 years from the 
date of each transaction involved, at least the following information:
    (1) For all deliveries of fee fish that the fish buyer buys from 
each fish seller:
    (i) The date of delivery,
    (ii) The fish seller's identity,
    (iii) The round weight of fee fish delivered,
    (iv) The identity of the fishing vessel that delivered the fee 
fish,
    (v) The delivery value,
    (vi) The net delivery value,
    (vii) The identity of the party to whom the net delivery value is 
paid, if other than the fish seller,
    (viii) The date the net delivery value was paid, and
    (ix) The total fee amount collected;
    (2) For all fee collection deposits to and disbursements from the 
deposit account:
    (i) The dates and amounts of deposits,
    (ii) The dates and amounts of disbursements to the subaccount's 
lockbox account, and
    (iii) The dates and amounts of disbursements to the fish buyer or 
other parties of interest earned on deposits.
    (e) Annual report. By January 15, 2001, and by each January 15 
thereafter until the loan is fully repaid, each fish buyer shall submit 
to NMFS a report, on or in the form NMFS specifies, containing the 
following information for the preceding year for all fee fish each fish 
buyer purchases from fish sellers:
    (1) Total round weight bought;
    (2) Total delivery value paid;
    (3) Total fee amount collected;
    (4) Total fee collection amounts deposited by month;
    (5) Dates and amounts of monthly disbursements to the subaccount 
lockbox;
    (6) Total amount of interest earned on deposits; and
    (7) Depository account balance at year-end.
    (f) State records. If landing records that a state requires from 
fish sellers contain some or all of the data that this section requires 
and state confidentiality laws or regulations do not prevent NMFS' 
access to the records maintained for the state, then fish buyers can 
use such records to meet appropriate portions of this section's 
recordkeeping requirements. If, however, state confidentiality laws or 
regulations make such records unavailable to NMFS, then fish buyers 
shall maintain separate records for NMFS that meet the requirements of 
this section.
    (g) Audits. NMFS or its agents may audit, in whatever manner NMFS 
believes reasonably necessary for the duly diligent administration of 
the loan, the financial records of the fish buyers and the fish sellers 
in order to ensure proper fee payment, collection, deposit, 
disbursement, accounting, recordkeeping, and reporting. Fish buyers and 
fish sellers shall make all records of all transactions involving fee 
fish catches, fish deliveries, and fee payments, collections, deposits, 
disbursements, accounting, recordkeeping, and reporting available to 
NMFS or its agents at reasonable times and places and promptly provide 
all requested information reasonably related to these records that such 
fish sellers and fish buyers may otherwise lawfully provide. Trip 
tickets (or similar accounting records establishing the round weight 
pounds of fee fish that each fish buyer buys from each fish seller each 
time that each fish buyer does so) are essential audit documentation.

[[Page 5283]]

    (h) Confidentiality of records. NMFS and its auditing agents shall 
maintain the confidentiality of all data to which NMFS has access under 
this section and shall neither release the data nor allow the data's 
use for any purpose other than the purpose of this subpart, unless 
otherwise required by law; provided, however, that NMFS may aggregate 
such data so as to preclude their identification with any fish buyer or 
any fish seller and use them in the aggregate for other purposes.
    (i) Refunds. When NMFS determines that the loan is fully repaid, 
NMFS will refund any excess fee receipts, on a last-in/first-out basis, 
to the fish buyers. Fish buyers shall return the refunds, on a last-in/
first-out basis, to the fish sellers who paid the amounts refunded.


Sec. 679.64  Late charges.

    The late charge to fish buyers for fee payment, collection, 
deposit, and/or disbursement shall be one and one-half (1.5) percent 
per month, or the maximum rate permitted by state law, for the total 
amount of the fee not paid, collected, deposited, and/or disbursed when 
due to be paid, collected, deposited, and/or disbursed within 5 days of 
the date due. The full late charge shall apply to the fee for each 
month or portion of a month that the fee remains unpaid, uncollected, 
undeposited, and/or undisbursed.


Sec. 679.65  Enforcement.

    In accordance with applicable law or other authority, NMFS may take 
appropriate action against each fish seller and/or fish buyer 
responsible for non-payment, non-collection, non-deposit, and/or non-
disbursement of the fee in accordance with this subpart to enforce the 
collection from such fish seller and/or fish buyer of any fee 
(including penalties and all costs of collection) due and owing the 
United States on account of the loan that such fish seller and/or fish 
buyer should have, but did not, pay, collect, deposit, and/or disburse 
in accordance with this subpart. All such loan recoveries shall be 
applied to reduce the unpaid balance of the loan.


Sec. 679.66  Prohibitions and penalties.

    (a) The following activities are prohibited, and it is unlawful for 
anyone to:
    (1) Avoid, decrease, interfere with, hinder, or delay payment or 
collection of, or otherwise fail to fully and properly pay or collect, 
any fee due and payable under this subpart or convert, or otherwise use 
for any purpose other than the purpose this subpart intends, any paid 
or collected fee;
    (2) Fail to fully and properly deposit on time the full amount of 
all fee revenue collected under this subpart into a deposit account and 
disburse the full amount of all deposit principal to the subaccount's 
lockbox account--all as this subpart requires;
    (3) Fail to maintain full, timely, and proper fee payment, 
collection, deposit, and/or disbursement records or make full, timely, 
and proper reports of such information to NMFS--all as this subpart 
requires;
    (4) Fail to advise NMFS of any fish seller's refusal to pay, or of 
any fish buyer's refusal to collect, any fee due and payable under this 
subpart;
    (5) Refuse to allow NMFS or agents that NMFS designates to review 
and audit at reasonable times all books and records reasonably 
pertinent to fee payment, collection, deposit, disbursement, and 
accounting under this subpart or otherwise interfere with, hinder, or 
delay NMFS or it agents in the course of their activities under this 
subpart;
    (6) Make false statements to NMFS, any of the NMFS' employees, or 
any of NMFS' agents about any of the matters in this subpart;
    (7) Obstruct, prevent, or unreasonably delay or attempt to 
obstruct, prevent, or unreasonably delay any audit or investigation 
NMFS or its agents conduct, or attempt to conduct, in connection with 
any of the matters in this subpart; and/or
    (8) Otherwise materially interfere with the efficient and effective 
repayment of the loan.
    (b) Anyone who violates one or more of the prohibitions of 
paragraph (a) of this section is subject to the full range of penalties 
the Magnuson-Stevens Act and 15 CFR part 904 provide (including, but 
not limited to: civil penalties, sanctions, forfeitures, and punishment 
for criminal offenses) and to the full penalties and punishments 
otherwise provided by any other applicable law of the United States.
[FR Doc. 00-2284 Filed 2-2-00; 8:45 am]
BILLING CODE 3510-22-F