[Federal Register Volume 65, Number 241 (Thursday, December 14, 2000)]
[Rules and Regulations]
[Pages 78110-78118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-31649]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 679

[Docket No. 000331092-0315-02; I.D. 030100F]
RIN 0648-AM42


Fisheries of the Exclusive Economic Zone Off Alaska; License 
Limitation Program for the Scallop Fishery

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

ACTION:  Final rule and application period.

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SUMMARY:  NMFS issues regulations to implement Amendment 4 to the 
Fishery Management Plan for the Scallop Fishery off Alaska (FMP), which 
creates a license limitation program (LLP) for the scallop fishery). 
NMFS also announces the application period for this program. The 
scallop LLP will limit the number of participants and reduce fishing 
capacity in the scallop fishery off Alaska. The scallop LLP is 
necessary to achieve the conservation and management goals for the 
scallop fishery and is intended to further the objectives of the FMP.

DATES: (1) Final rule: Effective on January 16, 2001; and (2) 
application period: Beginning January 16, 2001, and ending on February 
12, 2001.

ADDRESSES: Applications are available from the Program Administrator, 
Restricted Access Management, NMFS Alaska Region, P.O. Box 21668, 
Juneau, AK 99802-1668, Attn: Philip Smith. Applications may be picked 
up in person from NMFS in the Federal Building, Room 713, Juneau, AK. 
Requests for applications may also be sent by facsimile to (907) 586-
7354. Copies of Amendment 4 to the Scallop FMP, and the Environmental 
Assessment/Regulatory Impact Review/Initial Regulatory Flexibility 
Analysis (EA/RIR/IRFA) prepared for this action are available from the 
North Pacific Fishery Management Council, 605 West 4th Ave., Suite 306, 
Anchorage, AK 99501-2252; telephone 907-271-2809. Copies of the Final 
Regulatory Impact Review (FRFA) prepared for this action are available 
from the Alaska Region, NMFS, P.O. Box 21668, Juneau, AK 99802-1668, 
Attn: Sue Salveson. Send comments on any ambiguity or unnecessary 
complexity arising from the language used in this final rule to the 
Administrator, Alaska Region, NMFS, P.O. Box 21668, Juneau, AK 99802-
1668.

FOR FURTHER INFORMATION CONTACT:  Gretchen Harrington, 907-586-7228, or 
[email protected].

SUPPLEMENTARY INFORMATION:  The North Pacific Fishery Management 
Council (Council) prepared the FMP under the authority of the Magnuson-
Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act). 
Under the FMP, management of all aspects of the scallop fishery, except 
limited access, is delegated to the State of Alaska (State). Federal 
regulations governing the scallop fishery appear at 50 CFR parts 600 
and 679. State regulations governing the scallop fishery appear in the 
Alaska Administrative Code (AAC) at 5 AAC Chapter 38--Miscellaneous 
Shellfish.
    State regulations establish guideline harvest levels for different 
scallop registration areas, fishing seasons, open and closed fishing 
areas, observer coverage requirements, bycatch limits, gear 
restrictions, and measures to limit processing efficiency (including a 
ban on the use of mechanical shucking machines and a limitation on crew 
size). The gear regulations limit vessels to using no more than two 15-
ft (4.5-m) dredges, except in Cook Inlet (State Registration Area H) 
where vessels are limited to using a single 6-ft (1.8-m) scallop 
dredge.
    The Council submitted Amendment 4 for Secretarial review, and a 
Notice of Availability of the amendment was published March 9, 2000 (65 
FR 12500), for a 60-day comment period that ended May 8, 2000. A 
proposed rule to implement Amendment 4 was published April 21, 2000 (65 
FR 21385), for a 45-day comment period that ended June 5, 2000. Eleven 
letters of comments were received concerning Amendment 4 and its 
implementing rule. NMFS approved Amendment 4 on June 8, 2000. A summary 
of comments received on Amendment 4 and its implementing rule and 
agency response to each comment are presented in the Responses to 
Comments later in this document.

Management Background and Need for Action

    The history of State and Federal management of the scallop fishery 
is described in the preamble to the rule proposed to implement 
Amendment 4 (April 21, 2000; 65 FR 21385). In summary, the scallop 
resource off Alaska has been commercially exploited for more than 30 
years. Between 1969 and 1991, about 40 percent of the annual scallop 
harvest came from State waters. Since 1991, Alaska scallop harvests 
have increasingly occurred in Federal waters. The fishery has occurred 
almost exclusively in Federal waters in recent years, but some fishing 
in State waters occurs off Yakutat, Dutch Harbor, and Adak.
    By 1992, fishery participants and management agencies developed 
growing concerns about excessive fishing capacity and exploitation in 
the scallop fishery. The Council was presented with information 
indicating that the stocks of weathervane scallops

[[Page 78111]]

were fully exploited and any increase in fishing effort could be 
detrimental to the stocks. This information raised conservation 
concerns because scallops are highly susceptible to local depletion and 
boom/bust cycles worldwide.
    The Council began its consideration of Federal management of the 
scallop fishery in 1992. The Council determined that Federal action was 
necessary because existing State statutes precluded a State vessel 
moratorium and, at that time, the State did not have authority under 
the Magnuson-Stevens Act to restrict access in Federal waters.
    On February 23, 1995, NMFS closed Federal waters off Alaska to 
fishing for scallops by emergency interim rule to address concerns 
about uncontrolled fishing for scallops by vessels fishing outside the 
jurisdiction of State regulations (60 FR 11054; March 1, 1995).
    In July 1995, NMFS approved an FMP for the scallop fishery (60 FR 
42070; August 15, 1995). The only management measure authorized and 
implemented under the FMP was an interim 1 year closure of Federal 
waters off Alaska to fishing for scallops that was intended to provide 
management agencies time to develop measures necessary to support a 
controlled fishery.
    During 1995, the Council prepared Amendment 1 to the FMP to replace 
the interim closure with a joint State-Federal management regime. NMFS 
approved Amendment 1 on July 10, 1996 (61 FR 38099). Amendment 1 
established a joint State-Federal management regime under which NMFS 
implemented Federal scallop regulations that duplicated most State 
scallop regulations. This joint State-Federal management regime was 
designed as a temporary measure to prevent unregulated fishing in 
Federal waters until changes in the Magnuson-Stevens Act enabled the 
Council to delegate management of the fishery to the State.
    NMFS approved Amendment 2 to the FMP in March 1997. This amendment 
established a temporary moratorium on the entry of new vessels into the 
scallop fishery in Federal waters off Alaska. NMFS published a final 
rule implementing the moratorium on April 11, 1997 (62 FR 17749). A 
vessel owner had to have made a legal landing of scallops during 1991, 
1992, or 1993, or during at least 4 separate years from 1980 through 
1990 to qualify for a moratorium permit. This moratorium expired June 
30, 2000. Eighteen vessel owners qualified for moratorium permits under 
the Federal vessel moratorium.
    Changes made to the Magnuson-Stevens Act in 1996 provided the 
authority to delegate management responsibility for the scallop fishery 
in Federal waters to the State. The Council formalized this delegation 
with Amendment 3, which granted the State the authority to manage all 
aspects of the scallop fishery in Federal waters, except limited 
access, including the authority to regulate vessels not registered 
under the laws of the State. The final rule implementing Amendment 3 
was published on July 17, 1998 (63 FR 38501).

Development of the Scallop LLP

    The Council recommended Amendment 4 to the scallop FMP in February 
1999. This amendment, approved by NMFS on June 8, 2000, establishes an 
LLP to replace the existing Federal moratorium program.
    The Council's recommendation responded to extensive public 
testimony that the scallop fishery suffered from excessive harvesting 
capacity. In 1996, members of the scallop industry submitted a proposal 
to the Council for an LLP. Industry members proposed an LLP to limit 
access to the fishery because they believed that they would suffer 
economic hardship if latent capacity were activated. ``Latent'' 
capacity refers to fishing capacity that is not currently active in the 
fishery but is capable of entering the fishery. Public testimony 
indicated that the re-entry of latent capacity would adversely affect 
the economic viability of current participants (i.e., their average 
gross income from scallops landed would not at least equal their 
average costs of fishing for scallops).
    Based on this information, the Council developed a problem 
statement and alternatives for analysis of an LLP to replace the vessel 
moratorium. The Council developed six alternatives and two options for 
the LLP. These alternatives ranged from no action, which result in open 
access to the scallop fishery, to programs that would issue between 
nine and 18 licenses. According to the official scallop LLP record, the 
Council's preferred alternative will yield a total of nine licenses. 
The options deal with area endorsements and vessel reconstruction and 
replacement. The Council's preferred options will: (1) allow all 
licenses to be statewide, but vessels that fished only in Cook Inlet in 
the qualifying period are limited to the existing gear restrictions for 
Cook Inlet; and (2) not allow increases in vessel length. The details 
of the alternatives and options can be found in the EA/RIR/FRFA (see 
ADDRESSES).
    The Council's intent in adopting the most restrictive alternative 
was to create an LLP that will reduce the number of participants in the 
fishery and eliminate growth in harvesting capacity. The Council's goal 
was to reduce effort to approach a sustainable fishery with maximum net 
benefits to the Nation, as required by the Magnuson-Stevens Act.

Operational Aspects of the Scallop LLP and Small Business 
Compliance Guide

1. General

    The LLP limits access to the commercial scallop fisheries in the 
exclusive economic zone (EEZ) off Alaska. A qualified person who 
applies as prescribed will receive a license(s) that authorizes that 
person to catch and retain scallops. Initial allocation of licenses 
will be based on the eligibility qualifications discussed below.

2. Nature of Scallop LLP Licenses and Qualification Periods

    A scallop LLP license is a permit that grants the person named on 
the license (i.e., the license holder) the privilege of catching and 
retaining scallops in Federal waters off Alaska. Permanent scallop LLP 
licenses issued using criteria discussed below will be transferable to 
an eligible transferee(s), subject to NMFS approval. Each license will 
specify certain endorsements and limitations, including the name and 
address of the license holder and the maximum length overall (MLOA) of 
the vessel on which the license could be used. Some licenses will also 
specify limitations on scallop dredging gear that could be deployed 
from the vessel. A scallop LLP license represents a privilege (not a 
property right) that could be amended or revoked at any time without 
compensation.
    NMFS will initially issue a scallop LLP license to an eligible 
applicant who held a State or Federal moratorium permit on February 8, 
1999, and who used that permit to make the necessary legal landings of 
scallops during the qualifying period. The qualifying period runs from 
January 1, 1996, through October 9, 1998 (1996 was the first year of 
scallop fishing under the Federal scallop FMP and October 9, 1998, was 
the date of Council initial action on the scallop LLP). The necessary 
legal landings of scallops is at least one landing in each of any 2 
calendar years during the qualifying period. A legal landing is defined 
at 50 CFR 679.2 as a landing in compliance with Federal and State 
commercial fishing regulations in effect at the time of the landing.
    A license authorizes the license holder to catch and retain 
scallops in

[[Page 78112]]

Federal waters off Alaska. The license holder could be an individual or 
a corporate person consistent with the definition of ``Person'' at 50 
CFR 679.2. The license holder is not required to be on-board a vessel 
when it is used to catch and retain scallops. However, the original 
scallop LLP license is required to be onboard the vessel when it is 
used to catch and retain scallops. Although a scallop LLP license will 
not be vessel-specific, the length overall of any vessel that is used 
to catch and retain scallops under the terms of the license will be 
constrained by the MLOA specified on the license. In addition, a 
license will specify any gear limitations. A permanent license also 
will be transferable, subject to NMFS review and approval of an 
application to transfer the license and the eligibility of the proposed 
transferee to receive a license by transfer.
    The scallop LLP eligibility criteria that require an applicant to 
have held a moratorium permit and to have made legal landings of 
scallops during the scallop LLP qualifying period are designed to 
account for past and recent participation in the scallop fishery. 
Hence, persons who were eligible for a vessel moratorium permit but did 
not apply or receive one will not now be eligible for a scallop LLP 
license. Also, the LLP requirement to have the original scallop LLP 
license onboard while the vessel is used to catch and retain scallops 
would prevent a license holder from deploying more than one vessel at 
the same time for that purpose through copies of an original scallop 
LLP license.

3. Gear Endorsements

    Most scallop LLP licenses will not have gear endorsements. However, 
persons who qualify for a scallop LLP license based on the legal 
landings of scallops harvested only from Cook Inlet (State Registration 
Area H) during the qualifying period will have a gear endorsement that 
limits the gear authorized by the license to a single 6-ft (1.8-m) 
dredge. A single 6-ft dredge is the maximum amount of gear authorized 
to catch and retain scallops in Cook Inlet. The purpose of this gear 
endorsement is to prevent expansion in overall fishing capacity of the 
scallop fleet. This purpose will be accomplished by not allowing 
operations in Cook Inlet to increase their fishing capacity outside of 
Cook Inlet beyond the level they used inside of Cook Inlet during the 
qualification period.

4. Vessel Length

    The length overall or ``length overall'' of a vessel is defined at 
50 CFR 679.2. Each scallop LLP license will specify the MLOA of a 
vessel that could be used under the authority of the license. A scallop 
LLP license could be used on any vessel equal to or less than the MLOA. 
The specified MLOA is equal to the length overall of the longest vessel 
used by the applicant to make legal scallop landings during the 
qualifying years with a valid moratorium permit. The purpose of the 
MLOA provision is to prevent expansion of harvesting capacity in the 
fishery, thus furthering the goals of the LLP.

5. Harvest Requirements

    A legal landing is defined at 50 CFR 679.2 as a landing in 
compliance with Federal and State commercial fishing regulations in 
effect at the time of the landing. Only legal landings of scallops 
qualify the applicant for a scallop LLP license. To qualify for a 
scallop license, the applicant had to make one legal landing of 
scallops in each of any 2 calendar years during the period beginning 
January 1, 1996, through October 9, 1998, with a valid moratorium 
permit.

6. Scallop LLP License Recipients

    A license will be issued only to an applicant meeting the 
eligibility criteria described above. In addition, an applicant must 
have been eligible on February 8, 1999, to document a fishing vessel 
under Chapter 121 of Title 46, U.S.C., to qualify for a scallop LLP 
license. Chapter 121 of Title 46, U.S.C., establishes citizenship 
requirements for documenting U.S. fishing vessels.

7. Application Process for Scallop LLP Licenses

    A one-time application period for scallop LLP licenses will begin 
on January 16, 2001, and end on February 12, 2001. All applications for 
licenses must be submitted during this time period. Applications 
postmarked after the ending date for the application period will be 
denied.
    Applications are available from NMFS Restricted Access Management, 
Alaska Region (see ADDRESSES). Also, NMFS will use the official records 
to identify qualified applicants and will notify these persons of the 
application period.
    To evaluate and verify an applicant's eligibility claim, NMFS has 
compiled an official LLP record for the scallop LLP containing 
information on qualified persons who held moratorium permits and used 
the permits to participate in the scallop fishery during the qualifying 
period. The official scallop LLP record contains only complete and 
verifiable information that will be used for the purpose of determining 
eligibility for a license, including information on vessels that 
participated in the scallop fishery during the relevant time periods, 
vessel ownership, and the dates, location, and numbers of qualifying 
landings of scallops made by those vessels.
    NMFS will compare the claims on the application with the official 
LLP record for all scallop LLP applications submitted during the 
application period. If the claims on the application are supported by 
the information in the official scallop LLP record, and those claims 
are sufficient to qualify the applicant for a license, the application 
will be approved and a license will be issued to the applicant. 
However, if the claims cannot be verified using information in the 
official scallop LLP record, the applicant will be notified and 
provided 60 days to submit information or evidence to support the 
unverified claims. For example, an applicant could provide State fish 
tickets to verify legal landings not found in the official scallop LLP 
record. Unsubstantiated or incompletely verified claims will not be 
accepted. If an applicant demonstrates that the claims submitted in the 
application are correct and sufficient to qualify the applicant for a 
license, NMFS will issue a license to the applicant at the conclusion 
of the evidentiary period.
    If information in the application is not substantiated or verified 
at the conclusion of the 60-day evidentiary period, NMFS will issue an 
initial administrative determination (IAD) denying the permit, 
including the reasons why the application is not accepted. Applicants 
then will be provided with an opportunity to appeal that IAD to the 
NMFS Office of Administrative Appeals, under 50 CFR 679.43.
    Pursuant to the license renewal provisions of 5 U.S.C. 558, NMFS 
will issue an interim (temporary, non-transferable) license to an 
applicant who was authorized to participate in the fishery in the year 
before the IAD is issued and who makes a credible claim to eligibility 
under the scallop LLP regulations. This interim permit will be issued 
at the same time an applicant is notified about the 60-day evidentiary 
period. This interim permit will authorize the applicant to catch and 
retain scallops and will be effective during administrative 
adjudication leading to a final agency action. Depending on the final 
agency action, the person will receive either a

[[Page 78113]]

permanent, transferable license, or no license at all.

8. Transfer Process for Scallop LLP Licenses

    The transfer process for scallop LLP licenses will enable a license 
holder to request a transfer of an LLP license to any person 
(designated transferee) who meets the eligibility requirements. 
Eligibility requirements include (1) the designated transferee being 
eligible to document a fishing vessel under Chapter 121, Title 46, 
U.S.C., (2) the parties to the transfer having no fines, civil 
penalties, other payments due and outstanding, or outstanding permit 
sanctions resulting from Federal fishing violations, and (3) the 
transfer not causing the designated transferee to exceed a two-license 
limit for the scallop LLP (see ``Ownership Limit'' below).
    A complete transfer application must be submitted to the Regional 
Administrator for approval before a transfer can occur. Application 
forms will be available from NMFS (RAM) on request (see ADDRESSES). 
NMFS will return incomplete applications to the applicant and will 
identify specific information that is necessary to make the application 
complete. Information that will be required in the transfer application 
includes (1) identification information for all parties to the 
transfer, (2) identification number of the license to be transferred, 
(3) declaration that the designated transferee is a U.S. citizen, (4) a 
copy of the contract or sales agreement for the transfer, (5) other 
information the Administrator, Alaska Region, NMFS (Regional 
Administrator) may require, and (6) the notarized signatures of the 
parties to the transfer.
    This final rule also provides for a transfer pursuant to court 
order, operation of law, or the terms of a security agreement. This 
provision contemplates that some transfers might not be voluntarily 
requested by the license holder. Under those circumstances, the 
Regional Administrator will review the information in the transfer 
application or other document and determine whether the requested 
transfer conflicts with other provisions of the scallop LLP 
regulations.

9. Ownership Limit

    An individual, corporation, partnership, or other legal entity is 
prohibited from holding more than two scallop licenses at one time. A 
person who holds two scallop licenses cannot receive an additional 
scallop license by transfer.
    The two-license ownership limit is intended to prevent any person 
from obtaining an excessive share of harvest privileges in the scallop 
fishery as required by national standard 4 of the Magnuson-Stevens Act. 
The Council determined that holding more than two scallop LLP licenses 
would constitute an excessive share in the context of this relatively 
small fishery.

Consistency With Section 303(b)(6) of the Magnuson-Stevens Act and 
a Fisheries Impact Statement

    The preamble of the proposed rule for the action (65 FR 21385; 
April 21, 2000) provides a complete discussion of the scallop LLP's 
consistency with section 303(b)(6) of the Magnuson-Stevens Act and a 
Fisheries Impact Statement for the scallop fishery.

Response to Comments

    NMFS received 11 letters of comments concerning the proposed rule. 
Seven letters indicated unqualified approval of Amendment 4 and its 
implementing rule. Four letters indicated general approval for the 
scallop LLP but expressed concerns about specific provisions in the 
program. These concerns are summarized into the following three 
comments and responses.
    Comment 1: License holders should have the ability to increase the 
length of their vessels.
    Response: The primary objective of the scallop LLP is to 
rationalize the scallop fishery. As indicated in the analysis, the 
scallop fleet prior to implementation of limited access had grown 
beyond the size necessary to harvest the resource, both in number of 
vessels and in fishing capacity of those vessels. Such an 
overcapitalized fleet represents an unnecessarily large and 
unproductive share of the economy's capital investment base. This 
condition of overcapitalization prevents the achievement of optimum 
yield (OY) from the fishery to the extent that operating costs are 
significantly higher than necessary to harvest the resource. National 
standard 1 of the Magnuson-Stevens Act requires that conservation and 
management measures shall prevent overfishing of each stock of fish 
while achieving, on a continuing basis, the OY from each fishery for 
the United States. The Magnuson-Stevens Act also authorizes the Council 
to design a limited access program for a fishery to achieve OY. OY is 
defined as that amount of the resource that will provide the greatest 
overall benefit to the Nation. An overcapitalized fishery is 
antithetical to OY and providing the greatest overall benefit to the 
Nation because, as explained earlier, the economic rents in such a 
fishery are lower than those achievable, and overall capital costs in 
that fishery are higher than required.
    To allow persons to increase the length of their vessels beyond the 
size previously used in scallop fishery would only exacerbate the 
current overcapitalization problem. An increase in the length of a 
vessel can increase the overall fishing capacity of that vessel. Such 
an increase would not be different than allowing more participants into 
the fishery. This is contrary to the primary objective of the scallop 
LLP, which is to rationalize the fishery by reducing capacity and 
participants, and thereby reducing overcapitalization to the greatest 
extent possible.
    Establishing an MLOA based on the largest vessel used by the 
qualified applicant during the qualification period does not violate 
national standard 10 (safety concerns) of the Magnuson-Stevens Act. 
First, a person is not required to reduce the size of the vessel they 
chose to use in the fishery prior to implementation of the scallop LLP. 
Second, the incentive to fish during inclement weather to catch a 
portion of the resource before other participants do will be reduced 
because fewer participants will compete under the scallop LLP. Third, 
vessel replacements are possible. The MLOA requirement does not 
prohibit a person from replacing a derelict vessel with one that is 
within the size limits established by the MLOA
    Comment 2 : The requirement that limits a vessel to using a single 
6-ft (1.8-m) dredge in all areas if that vessel did not participate 
outside of Cook Inlet during the recent qualifying period is 
inconsistent with national standards and other Magnuson-Stevens Act 
provisions.
    Response: The Council has the authority to recommend, and NMFS has 
the authority to approve, limited access systems, such as the scallop 
LLP, if the Council and NMFS consider criteria listed in 16 U.S.C. 
1853(b)(6) and ensure that the assignment of fishing privileges among 
various U.S. fishermen is fair and equitable.
    The Council, when it recommended the provision limiting the amount 
of gear used by certain vessels, used recent participation, a criterion 
in 16 U.S.C. 1853(b)(6), as a determining factor. The Council indicated 
that part of its rationale for this provision is the control of 
overcapitalization. Overcapitalization can have adverse impacts on the 
economics of a fishery, another criterion in 16 U.S.C. 1853(b)(6). An 
analysis of the various alternatives for a license

[[Page 78114]]

limitation program indicated that the break-even number of vessels for 
economic viability in this fishery is a maximum of nine vessels. Based 
on that information, the Council decided to choose the most restrictive 
alternative, allowing nine vessels into the fishery, and restricting 
those vessels to the gear used during the most recent participation 
period.
    As in all limited access programs, the Council also considered the 
need to limit fishing capacity when it developed this provision. The 
method used to limit fishing capacity, by limiting a person's gear to 
the amount used in the recent participation period, is consistent with 
criteria specified in the Magnuson-Stevens Act. As all persons that are 
similarly situated are treated in the same manner, NMFS has determined 
that the gear limitation provision in the scallop LLP is consistent 
with the national standards specified in the Magnuson-Stevens Act and 
with other applicable law.
    Comment 3: The scallop LLP should have included area endorsements.
    Response: The Council considered including area endorsements as 
part of the scallop LLP. This option was considered to provide 
protection to the small boat fleet inside Cook Inlet from competition 
by larger outside vessels. The Council chose not to include area 
endorsements for three reasons. First, the season opening dates for 
Yakutat and Prince William Sound have been changed from January 1 to 
July 1. This provides additional fishing opportunities for vessels 
during the summer months, and reduces the incentives to large vessel 
operators to fish in Cook Inlet. Second, only a single 6-ft (1.8-m) 
dredge can be used in Cook Inlet. Fishing with a large vessel and crew 
under that gear restriction would not be economical. Third, the Cook 
Inlet (Kamishak) quota has remained very small relative to outside 
areas. This reduces the incentive to forego fishing in outside areas in 
favor of fishing in Cook Inlet. The Council decided that area 
endorsements were unnecessary because these three factors will keep the 
fleet from significantly deviating from traditional fishing patterns.
    In this final rule, the definition of MLOA is revised slightly to 
clarify that the longest vessel authorized by a Federal or State 
Scallop Moratorium Permit and from which the eligible applicant made 
legal landings of scallops during the scallop LLP qualification period, 
will be used to determine the MLOA on the scallop LLP license. Also, 
the final rule lengthens the application period from 15 days to 30 
days. Otherwise, this final rule makes no other changes to the proposed 
rule other than minor editorial changes.

Classification

    The Administrator, Alaska Region, NMFS, determined that Amendment 4 
to the FMP for the Scallop Fishery off Alaska is necessary for the 
conservation and management of the scallop fishery and that it is 
consistent with the Magnuson-Stevens Act and other applicable laws.
    The Council prepared an EA/RIR/IRFA for the scallop LLP, which 
describes the management background, the purpose and need for action, 
the management alternatives, and the socio-economic impacts of the 
alternatives. It estimates the total number of small entities affected 
by this action, and analyzes the economic impact on those small 
entities as required by the Regulatory Flexibility Act.
    NMFS prepared an FRFA based on the IRFA. The IRFA prepared for this 
action was made available for public review and comment. NMFS received 
no letters of public comment in response to the IRFA. The FRFA 
describes the economic impacts this rule will have on small entities. A 
summary of the FRFA follows.
    NMFS considers the fishing operations that will be affected by this 
final rule to be small entities. The universe of small entities is 
composed of 18 operators who fished for scallops during the 1980-1998 
period and that qualified for a moratorium permit.
    NMFS considered six alternative for the scallop LLP. These 
alternatives ranged from no action, which would result in open access 
to the scallop fishery, to programs that would issue between nine and 
18 licenses. According to the official scallop LLP record, the 
preferred alternative will yield a total of nine licenses. The options 
dealt with area endorsements and vessel construction and replacement. 
The preferred options will: (1) allow all licenses to be statewide, but 
vessels that fished only in Cook Inlet in the qualifying period are 
limited to the existing gear restrictions for Cook Inlet; and (2) not 
allow increases in vessel length. The FRFA details these alternatives 
and options.
    In order to meet the primary objectives, the Council developed 
eligibility criteria that reduced the fleet, but granted harvesting 
privileges to those operations what were most dependent on the scallop 
fishery as evidenced through past and recent participation. The 
preferred alternative struck the appropriate balance by reducing the 
fleet enough so that excess capacity and capitalization will be less of 
a problem, but not reducing the fleet to the point of eliminating 
operations most dependent on the scallop resource.
    The preferred alternative was chosen even though it would have a 
significant impact on a substantial number of small entities because it 
was the only alternative that fully met the requirements of the 
Magnuson-Stevens Act to achieve OY, reduce overcapitalization, and 
maximize economic benefits to the Nation. Reduction of capital and 
capacity were primary objectives of this action. Because NMFS is 
addressing the allocation of a limited resource, alternatives to 
minimize economic impacts on some small entities would necessarily 
result in increased impacts on others.
    The Council's break-even analysis, contained in the EA/RIR/IRFA, 
indicated that a total of about six or seven vessels could participate 
full time in the Alaska statewide scallop fishery at the break-even 
level (not including Cook Inlet vessels). The Cook Inlet fishery 
appears to be fully capitalized, and perhaps overcapitalized at the 
current level of effort (three to four vessels). The break-even 
analysis showed that the current scallop fleet contained more vessels 
that necessary to harvest the resource efficiently and that open access 
has negative impacts on all members of the fleet.
    Each alternative that reduces capacity in the fishery benefits the 
remaining fleet. However, by reducing capacity, some vessels are 
excluded from the fishery. The preferred alternative excludes nine 
vessels from the fishery, creating a fleet of nine vessels, which is 
the most restrictive alternative and closest to the break-even point.
    NMFS concludes that the principal effect of this rule on small 
entities is that the LLP will significantly impact the vessels excluded 
from the fishery. The flexibility of open access will be reduced, 
limited economic opportunities for some non-qualifying fishermen. Non-
qualifying fishermen will not be eligible for a license during the 
initial issuance because they do not meet the eligibility criteria. 
These fishermen may be eligible to obtain a license through transfer to 
participate in the scallop fishery.
    The scallop LLP also inhibits the ability of new, small entities to 
enter the fishery because new entrants must purchase a license, thereby 
increasing the entry cost into the scallop fishery. Alternatively, 
small fishing firms owning non-qualifying vessels may experience a 
decrease in the value of their investments to the extent that the

[[Page 78115]]

vessel's opportunities have been limited.
    The scallop LLP also affects small entities that only fished inside 
of Cook Inlet during the qualifying period by limiting the size and 
number of dredges those vessels could operate in areas outside of Cook 
Inlet to a single 6-ft (1.8-m) dredge. However, those small entities 
can use their licenses to harvest scallops statewide and will not be 
limited to harvesting scallops in Cook Inlet. The scallop LLP also 
affects the small entities that receive licenses by restricting their 
ability to increase vessel length.
    The impact of license limitation is to restrict the opportunities 
of some vessel owners, yet offer a stabilized economic environment for 
affected small businesses that qualify for continued participation in 
the Alaska scallop fishery. The benefits accrue from preventing a 
further erosion of per-vessel net returns and operating efficiency.
    NMFS considered measures to minimize the significant economic 
impact on small entities. NMFS concluded that alternative policies that 
would minimize adverse impacts on excluded small entities also would 
dilute or eliminate the benefits to the fleet as a whole of reduced 
fishing capacity under the LLP. Allowing one or two additional vessels 
to participate (relative to the preferred alternative) would reduce 
impacts on those one or two small entities. However, it also would 
reduce the beneficial effect of the LLP by reducing the average harvest 
of all vessels (all other small entities) in the fishery and their 
potential profitability by preventing attainment of the break-even 
fleet size. Hence, alternative measures that would reduce the impacts 
on small entities that are negatively affected would not achieve the 
objectives of this action.
    The scallop LLP will reduce the adverse impacts on a substantial 
number of small entities resulting from open access. Generally, small 
entities included in the fishery under the LLP benefit, while those 
excluded will be adversely affected. Alternatives and options that 
perpetuate overcapitalization in the scallop fishery would have 
negative impacts on vessel owners, crew, and fishing communities. The 
LLP will help reduce overcapitalization of the fishery and the loss of 
income to current participants that would result from further 
overcapitalization. Issued licenses will have monetary value, and 
latent licenses (issued to vessels not currently fishing) if allowed, 
would likely be transferred to other vessels wishing to participate in 
the scallop fishery.
    This final rule contains new recordkeeping and reporting 
requirements. All persons wishing to participate in the scallop fishery 
under the LLP would be required to submit to NMFS a completed 
application for a license. Also, all persons taking part in the 
transfer of a license would be required to submit an application for 
transfer of the license to NMFS. An applicant wishing to appeal an 
initial administrative determination on an application would submit in 
writing a concise statement of reasons why the determination should be 
reversed or modified. These collections of information are necessary to 
provide information to NMFS for the implementation and management of 
the LLP.
    In summary, the scallop LLP will have economic impacts on vessels 
excluded from the scallop fishery. The flexibility of open access will 
be reduced, thereby limiting the economic opportunities for some non-
qualifying fishermen. However, this reduced flexibility will be offset 
by increased stability and financial security for the remaining 
participants in the scallop fisheries. The increased economic stability 
and viability of the qualified applicants is the purpose of 
establishing this program and is consistent with the Magnuson-Stevens 
Act, which authorizes the establishment of limited access systems in 
order to achieve OY.
    This final rule has been determined to be not significant for 
purposes of Executive Order 12866.
    Notwithstanding any other provision of the law, no person is 
required to respond to, and no person shall be subject to a penalty for 
failure to comply with, a collection of information subject to the 
requirement of the Paperwork Reduction Act (PRA), unless that 
collection of information displays a currently valid OMB control 
number.
    This final rule contains collection-of-information requirements 
subject to the PRA. These collection-of-information requirements have 
been approved by OMB and issued OMB control number 0648-0420, 
expiration date 07-31-2003. Public reporting burden for these 
collections of information are estimated to be an average of 2 hours 
per response for an application for initial issuance of a license, 1 
hour per response for an application for transfer of a license, and 4 
hours per response for an appeal of an initial administrative 
determination. These response times include the time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information. Send comments regarding these burden 
estimates or any other aspect of the data requirements, including 
suggestions for reducing the burden, to NMFS (see ADDRESSES) and to the 
Office of Information and Regulatory Affairs, Office of Management and 
Budget, Washington, DC 20503 (Attn: NOAA Desk Officer).
    The President has directed Federal agencies to use plain language 
in their communications with the public, including regulations. To 
comply with this directive, we seek public comment on any ambiguity or 
unnecessary complexity arising from the language used in this final 
rule. Such comment should be sent to the Regional Administrator (see 
ADDRESSES).

List of Subjects in 50 CFR Part 679

    Alaska, Fisheries, Reporting and recordkeeping requirements.

    Dated: December 6, 2000.
William T. Hogarth,
Deputy Asst. Administrator for Fisheries, National Marine Fisheries 
Service.

     For reasons set out in the preamble, 50 CFR part 679 is amended as 
follows:

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

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

    Authority:  16 U.S.C. 773 et seq., 1801 et seq., and 3631 et 
seq.; Title II of Division C, Pub. L. 105-277; Sec. 3027, Pub. L. 
106-31, 113 Stat. 57; 16 U.S.C. 1540(f).

    2. In Sec. 679.1, paragraphs (j)(3) and (j)(4) are added to read as 
follows:


Sec. 679.1  Purpose and scope.

* * * * *
    (j) * * *
    (3) Regulations in this part implement the license limitation 
program for the commercial scallop fishery in the EEZ off Alaska.
    (4) Regulations in this part govern the commercial fishing for 
scallops by vessels of the United States using authorized gear within 
the EEZ off Alaska.
* * * * *

    3. In Sec. 679.2, the definition for ``Scallop license'' is added 
in alphabetical order and the definitions ``Eligible applicant'', 
``License holder'', ``Maximum LOA'', ``Official LLP record'', and 
``Qualified Person'' are revised to read as follows:


Sec. 679.2  Definitions.

* * * * *
    Eligible applicant means a qualified person who submitted an 
application

[[Page 78116]]

during the application period announced by NMFS and:
    (1) For a groundfish license or crab species license, who owned a 
vessel on June 17, 1995, from which the minimum number of documented 
harvests of license limitation groundfish or crab species were made in 
the relevant areas during the qualifying periods specified in 
Sec. 679.4(k)(4) and (k)(5), unless the fishing history of that vessel 
was transferred in conformance with the provisions in paragraph (2) of 
this definition; or
    (2) For a groundfish license or crab species license, to whom the 
fishing history of a vessel from which the minimum number of documented 
harvests of license limitation groundfish or crab species were made in 
the relevant areas during the qualifying periods specified in 
Sec. 679.4(k)(4) and (k)(5) has been transferred or retained by the 
express terms of a written contract that clearly and unambiguously 
provides that the qualifications for a license under the LLP have been 
transferred or retained; or
    (3) For a crab species license, who was an individual who held a 
State of Alaska permit for the Norton Sound king crab summer fishery in 
1993 and 1994, and who made at least one harvest of red or blue king 
crab in the relevant area during the period specified in 
Sec. 679.4(k)(5)(ii)(G), or a corporation that owned or leased a vessel 
on June 17, 1995, that made at least one harvest of red or blue king 
crab in the relevant area during the period in Sec. 679.4(k)(5)(ii)(G), 
and that was operated by an individual who was an employee or a 
temporary contractor; or
    (4) For a scallop license, who qualifies for a scallop license as 
specified at Sec. 679.4(g)(2) of this part; or
    (5) Who is an individual that can demonstrate eligibility pursuant 
to the provisions of the Rehabilitation Act of 1973 at 29 U.S.C. 794 
(a).
* * * * *
    License holder means the person who is named on a currently valid 
groundfish license, crab species license, or scallop license.
* * * * *
    Maximum LOA (MLOA) means:
    (1)With respect to the scallop license limitation program, the MLOA 
is equal to the length overall on February 8, 1999, of the longest 
vessel that was:
    (i) Authorized by a Federal or State of Alaska Scallop Moratorium 
Permit to harvest scallops;
    (ii) Used by the eligible applicant to make legal landings of 
scallops during the scallop LLP qualification period, as specified at 
Sec.  679.4(g)(2)(iii) of this part.
    (2) With respect to the groundfish and crab species license 
limitation program, the LOA of the vessel on June 24, 1992, unless the 
vessel was less than 125 ft (38.1 m) on June 24, 1992, then 1.2 times 
the LOA of the vessel on June 24, 1992, or 125 ft (38.1 m), whichever 
is less. However, if the vessel was under reconstruction on June 24, 
1992, then the basis for the MLOA will be the LOA of the vessel on the 
date that reconstruction was completed and not June 24, 1992. The 
following exceptions apply regardless of how the MLOA was determined.
    (i) If the vessel's LOA on June 17, 1995, was less than 60 ft (18.3 
m), or if the vessel was under reconstruction on June 17, 1995, and the 
vessel's LOA on the date that reconstruction was completed was less 
than 60 ft (18.3 m), then the vessel's MLOA cannot exceed 59 ft (18 m).
    (ii) If the vessel's LOA on June 17, 1995, was greater than or 
equal to 60 ft (18.3 m) but less than 125 ft (38.1 m), or if the vessel 
was under reconstruction on June 17, 1995, and the vessel's LOA on the 
date that reconstruction was completed was greater than or equal to 60 
ft (18.3 m) but less 125 ft (38.1 m), then the vessel's MLOA cannot 
exceed 124 ft (37.8 m).
    (iii) If the vessel's LOA on June 17, 1995, was 125 ft (38.1 m) or 
greater, then the vessel's MLOA is the vessel's LOA on June 17, 1995, 
or if the vessel was under reconstruction on June 17, 1995, and the 
vessel's LOA on the date that reconstruction was completed was 125 ft 
(38.1 m) or greater, then the vessel's MLOA is the vessel's LOA on the 
date reconstruction was completed.
* * * * *
    Official License Limitation Program (LLP) record means the 
information prepared by the Regional Administrator about vessels that 
were used to participate in the groundfish or crab fisheries during 
qualified periods for the groundfish and crab LLP specified at 
Sec. 679.4(k) and in the scallop fisheries during the qualifying 
periods for the scallop LLP specified at Sec. 679.4(g). Information in 
the official LLP record includes vessel ownership information, 
documented harvests made from vessels during the qualification periods, 
and vessel characteristics. The official LLP record is presumed to be 
correct for the purpose of determining eligibility for licenses. An 
applicant for a license under the LLP will have the burden of proving 
the validity of information submitted in an application that is 
inconsistent with the official LLP record.
* * * * *
    Qualified Person means:
    (1) With respect to the IFQ program, see IFQ Management Measures at 
Sec. 679.40(a)(2).
    (2) With respect to the groundfish and crab species license 
limitation program, a person who was eligible on June 17, 1995, to 
document a fishing vessel under Chapter 121, Title 46, U.S.C.
    (3) With respect to the scallop LLP, a person who was eligible on 
February 8, 1999, to document a fishing vessel under Chapter 121, Title 
46, U.S.C.
* * * * *
    Scallop license means a license issued by NMFS that authorizes the 
license holder to catch and retain scallops pursuant to the conditions 
specified on the license.
* * * * *

    4. In Sec. 679.4, paragraph (g) is added to read as follows:


Sec. 679.4   Permits.

* * * * *
    (g) Scallop LLP--(1) General requirements. In addition to the 
permit and licensing requirements prescribed in this part, each vessel 
within the EEZ off Alaska that is catching and retaining scallops, must 
have an original scallop LLP license on board at all times it is 
catching and retaining scallops. This scallop LLP license, issued by 
NMFS, authorizes the person named on the license to catch and retain 
scallops in compliance with regulations of the State of Alaska and only 
with a vessel that does not exceed the MLOA specified on the license 
and the gear designation specified on the license.
    (2) Qualifications for a scallop LLP license. A scallop LLP license 
will be issued to an eligible applicant who:
    (i) Is a qualified person;
    (ii) Was named on a State of Alaska scallop moratorium permit or 
Federal scallop moratorium permit on February 8, 1999;
    (iii) Used the moratorium permit held on February 8, 1999, to make 
legal landings of scallops in each of any 2 calendar years during the 
qualification period beginning January 1, 1996, through October 9, 
1998; and
    (iv) Submitted a complete application for a scallop license during 
the application period specified pursuant to paragraph (g)(4) of this 
section.
    (3) Scallop license conditions and endorsements. A scallop license 
authorizes the license holder to catch and retain scallops only if the 
vessel length and gear used do not exceed the vessel length and gear 
endorsements specified on the license. These endorsements will be 
determined as follows.

[[Page 78117]]

    (i) The MLOA specified on the scallop license is equal to the 
length overall on February 8, 1999, of the longest vessel that was 
authorized by a Federal or State of Alaska Scallop Moratorium Permit to 
harvest scallops and used by the eligible applicant to make legal 
landings of scallops during the scallop LLP qualification period, as 
specified at Sec. 679.4(g)(2)(iii) of this part.
    (ii) The gear specified on a scallop license will be restricted to 
a single 6-ft (1.8-m) dredge in all areas if the eligible applicant was 
a moratorium permit holder with a Scallop Registration Area H (Cook 
Inlet) endorsement and did not make a legal landing of scallops caught 
outside of Area H during the qualification period specified in 
paragraph (g)(2)(iii) of this section.
    (4) Application for a scallop license--(i) General. The Regional 
Administrator will issue a scallop license to an applicant if a 
complete application is submitted by or on behalf of the applicant 
during the specified application period, and if that applicant meets 
all the criteria for eligibility in this part. An application that is 
postmarked or hand delivered after the ending date for the application 
period for the scallop LLP specified in paragraph Sec. 679.4(g)(4)(ii) 
will be denied. An application form will be sent to the last known 
address of the person identified as an eligible applicant by the 
official LLP record. An application form may be requested from the 
Regional Administrator.
    (ii) Application Period. January 16, 2001, through February 12, 
2001.
    (iii) Contents of application. To be complete, an application for a 
scallop license must be signed and dated by the applicant, or the 
individual representing the applicant, and contain the following 
information, as applicable:
    (A) Scallop Moratorium Permit number under which legal landings of 
scallops were made during the qualification period specified in 
paragraph (g)(2)(iii) of this section;
    (B) Name, business address, telephone number, FAX number, and 
social security number or tax ID number of the applicant, and whether 
the applicant is a U.S. citizen or a U.S. business;
    (C) Name of the managing company, if any;
    (D) Evidence of legal landings in the qualifying years and 
registration areas;
    (E) For the vessel(s) being used as the basis for eligibility for a 
license, the name, state registration number (e.g., ADF&G number), the 
USCG documentation number, and valid evidence of the LOA on February 8, 
1999, of the longest vessel used by the applicant during the 
qualification period specified in paragraph (g)(2)(iii) of this 
section.
    (iv) Successor-in-interest. If an applicant is applying as the 
successor-in-interest to an eligible applicant, an application, to be 
complete, also must contain valid evidence proving the applicant's 
status as a successor-in-interest to that eligible applicant and:
    (A) Valid evidence of the death of that eligible applicant at the 
time of application, if the eligible applicant was an individual; or
    (B) Valid evidence that the eligible applicant is no longer in 
existence at the time of application, if the eligible applicant is not 
an individual.
    (v) Application evaluation. The Regional Administrator will 
evaluate an application submitted during the specified application 
period and compare all claims in the application with the information 
in the official LLP record. Claims in the application that are 
consistent with information in the official LLP record will be accepted 
by the Regional Administrator. Inconsistent claims in the application, 
unless verified by evidence, will not be accepted. An applicant who 
submits inconsistent claims, or an applicant who fails to submit the 
information specified in paragraphs (g)(4)(iii) and (g)(4)(iv) of this 
section, will be provided a 60-day evidentiary period pursuant to 
paragraph (g)(4)(vii) of this section to submit the specified 
information, submit evidence to verify his or her inconsistent claims, 
or submit a revised application with claims consistent with information 
in the official LLP record. An applicant who submits claims that are 
inconsistent with information in the official LLP record has the burden 
of proving that the submitted claims are correct.
     (vi) Additional information or evidence. The Regional 
Administrator will evaluate additional information or evidence to 
support an applicant's inconsistent claims submitted within the 60-day 
evidentiary period pursuant to paragraph (g)(4)(vii) of this section. 
If the Regional Administrator determines that the additional 
information or evidence meets the applicant's burden of proving that 
the inconsistent claims in his or her application are correct, the 
official LLP record will be amended and the information will be used in 
determining whether the applicant is eligible for a license. However, 
if the Regional Administrator determines that the additional 
information or evidence does not meet the applicant's burden of proving 
that the inconsistent claims in his or her application is correct, the 
applicant will be notified by an initial administrative determination, 
pursuant to paragraph (g)(4)(viii) of this section, that the applicant 
did not meet the burden of proof to change the information in the 
official LLP record.
     (vii) 60-day evidentiary period. The Regional Administrator will 
specify by letter a 60-day evidentiary period during which an applicant 
may provide additional information or evidence to support the claims 
made in his or her application, or to submit a revised application with 
claims consistent with information in the official LLP record, if the 
Regional Administrator determines that the applicant did not meet the 
burden of proving that the information on the application is correct 
through evidence provided with the application. Also, an applicant who 
fails to submit information as specified in paragraphs (g)(4)(iii) and 
(g)(4)(iv) of this section will have 60 days to provide that 
information. An applicant will be limited to one 60-day evidentiary 
period. Additional information or evidence, or a revised application, 
received after the 60-day evidentiary period specified in the letter 
has expired will not be considered for purposes of the initial 
administrative determination.
    (viii) Initial administrative determinations (IAD). The Regional 
Administrator will prepare and send an IAD to the applicant following 
the expiration of the 60-day evidentiary period if the Regional 
Administrator determines that the information or evidence provided by 
the applicant fails to support the applicant's claims and is 
insufficient to rebut the presumption that the official LLP record is 
correct, or if the additional information, evidence, or revised 
application is not provided within the time period specified in the 
letter that notifies the applicant of his or her 60-day evidentiary 
period. The IAD will indicate the deficiencies in the application, 
including any deficiencies with the information, the evidence submitted 
in support of the information, or the revised application. The IAD will 
also indicate which claims cannot be approved based on the available 
information or evidence. An applicant who receives an IAD may appeal 
pursuant to Sec. 679.43. An applicant who avails himself or herself of 
the opportunity to appeal an IAD will not receive a transferable 
license until after the final resolution of that appeal in the 
applicant's favor.
    (ix) Issuance of a non-transferable license. The Regional 
Administrator will issue a non-transferable license to the applicant at 
the same time notification is provided to the applicant of his or her 
60-day evidentiary period if issuance is required by the license 
renewal

[[Page 78118]]

provisions of 5 U.S.C. 558. A non-transferable license authorizes a 
person to catch and retain scallops as specified on the non-
transferable license, and will have the specific endorsements and 
designations based on the claims in his or her application. A non-
transferable license will expire upon final agency action.
    (5) Transfer of a Scallop License--(i) General. The Regional 
Administrator will approve the transfer of a scallop license if a 
complete transfer application is submitted to Restricted Access 
Management, Alaska Region, NMFS, and if the transfer meets all the 
eligibility criteria as specified in paragraph (g)(5)(ii) of this 
section. An application form may be requested from the Regional 
Administrator.
    (ii) Eligibility criteria for transfers. A scallop license can be 
transferred if:
    (A) The designated transferee is eligible to document a fishing 
vessel under Chapter 121, Title 46, U.S.C.;
    (B) The parties to the transfer do not have any fines, civil 
penalties, other payments due and outstanding, or outstanding permit 
sanctions resulting from Federal fishing violations;
    (C) The transfer will not cause the designated transferee to exceed 
the license limit in Sec. 679.7(i); and
    (D) The transfer does not violate any other provision specified in 
this part.
    (iii) Contents of transfer application. To be complete, an 
application for a scallop license transfer must be signed by the 
licence holder and the designated transferee, or the individuals 
representing them, and contain the following information, as 
applicable:
    (A) Name, business address, telephone number, FAX number, and 
social security number or tax ID number, of the license holder and of 
the designated transferee;
    (B) License number and total price being paid for the license;
    (C) Certification that the designated transferee is a U.S. citizen, 
or a U.S. corporation, partnership, or other association;
    (D) A legible copy of a contract or sales agreement that specifies 
the license to be transferred, the license holder, the designated 
transferee, the monetary value or the terms of the license transfer; 
and
    (E) Other information the Regional Administrator deems necessary 
for measuring program performance.
    (iv) Incomplete applications. The Regional Administrator will 
return an incomplete transfer application to the applicant and identify 
any deficiencies if the Regional Administrator determines that the 
application does not meet all the criteria identified in paragraph 
(g)(5) of this section.
    (v) Transfer by court order, operation of law, or as part of a 
security agreement. The Regional Administrator will transfer a scallop 
license based on a court order, operation of law, or a security 
agreement if the Regional Administrator determines that the transfer 
application is complete and the transfer will not violate any of the 
provisions of this section.

    5. In Sec. 679.7, paragraphs (i)(3) and (i)(7) are revised, and new 
paragraphs (i)(1(iv) and (i)(8) are added to read as follows:


Sec. 679.7  Prohibitions.

* * * * *
    (i)License Limitation Programs--(1) Number of licenses.* * *
    (iv) Hold more than two scallop licenses in the name of that person 
at any time.
* * * * *
    (3) Conduct directed fishing for crab species without an original 
valid crab license, except as provided in Sec. 679.4(k)(2);
* * * * *
    (7) Lease a groundfish, crab species, or scallop license; or
    (8) Catch and retain scallops:
    (i) Without an original valid scallop license on board;
    (ii) Using a vessel with a MLOA greater than that specified on the 
scallop license; or
    (iii) Using dredge gear contrary to a gear limitation specified on 
the scallop license.
* * * * *

    6. In Sec. 679.43, paragraphs (a) and (p) are revised to read as 
follows:


Sec. 679.43  Determinations and appeals.

    (a) General. This section describes the procedure for appealing 
initial administrative determinations made under part 679 of this 
chapter.
* * * * *
    (p) Issuance of a non-transferable license. A non-transferable 
license will be issued to a person upon acceptance of his or her appeal 
of an initial administrative determination denying an application for a 
license for license limitation groundfish, crab species under 
Sec. 679.4(k) or scallops under Sec. 679.4(g). This non-transferable 
license authorizes a person to conduct directed fishing for groundfish, 
crab species, or catch and retain scallops and will have specific 
endorsements and designations based on the person's claims in his or 
her application for a license. This non-transferable license expires 
upon the resolution of the appeal.
[FR Doc. 00-31649 Filed 12-13-00; 8:45 am]
BILLING CODE 3510-22-S