[Federal Register Volume 68, Number 204 (Wednesday, October 22, 2003)]
[Rules and Regulations]
[Pages 60449-60472]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-26345]



[[Page 60447]]

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Part II





Department of Homeland Security





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Coast Guard



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33 CFR Parts 2, 101, et al.

46 CFR Parts 2, 31, et al.



National Maritime Security Initiatives; Area Maritime Vessel, Facility, 
and Outer Continental Shelf Security; Automatic Indentification System, 
Vessel C

[[Page 60448]]

arriage Requirement; Final Rules

  Federal Register / Vol. 68, No. 204 / Wednesday, October 22, 2003 / 
Rules and Regulations  
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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Parts 2, 101 and 102

[USCG-2003-14792]
RIN 1625-AA69


Implementation of National Maritime Security Initiatives

AGENCY: Coast Guard, DHS.

ACTION: Final rule.

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SUMMARY: The Coast Guard has published a series of final rules in 
today's Federal Register that adopt, with changes, the series of 
temporary interim rules published July 1, 2003, which promulgate 
maritime security requirements mandated by the Maritime Transportation 
Security Act of 2002.
    This final rule establishes the general regulations for maritime 
security and provides the summary of the cost and benefit assessments 
for the entire suite of final rules published today. The discussions 
provided within each of the other final rules are limited to the 
specific requirements they contain.

DATES: This final rule is effective November 21, 2003. On July 1, 2003, 
the Director of the Federal Register approved the incorporation by 
reference of certain publications listed in this final rule.

ADDRESSES: Comments and material received from the public, as well as 
documents mentioned in this preamble as being available in the docket, 
are part of docket USCG-2003-14792 and are available for inspection or 
copying at the Docket Management Facility, U.S. Department of 
Transportation, room PL-401, 400 Seventh Street SW., Washington, DC, 
between 9 a.m. and 5 p.m., Monday through Friday, except Federal 
holidays. You may also find this docket on the Internet at http://dms.dot.gov.
    You may inspect the material incorporated by reference at room 
1409, U.S. Coast Guard Headquarters, 2100 Second Street SW., 
Washington, DC 20593-0001 between 8:30 a.m. and 3:30 p.m., Monday 
through Friday, except Federal holidays. The telephone number is 202-
267-6277. Copies of the material are available as indicated in the 
``Incorporation by Reference'' section of this preamble.

FOR FURTHER INFORMATION CONTACT: If you have questions on this final 
rule, call Captain Kevin Dale (G-MPS), U.S. Coast Guard by telephone 
202-267-6193 or by electronic mail at [email protected]. If you have 
questions on viewing the docket, call Andrea M. Jenkins, Program 
Manager, Docket Operations, Department of Transportation, at telephone 
202-366-0271.

SUPPLEMENTARY INFORMATION:

Regulatory Information

    On July 1, 2003, we published a temporary interim rule with request 
for comments and notice of public meeting titled ``Implementation of 
National Maritime Security Initiatives'' in the Federal Register (68 FR 
39240). This temporary interim rule was one of six temporary interim 
rules published in the July 1, 2003, issue of the Federal Register, 
each addressing maritime security. On July 16, 2003, we published a 
document correcting typographical errors and omissions in that rule (68 
FR 41914).
    We received a total of 438 letters in response to the six temporary 
interim rules by July 31, 2003. The majority of these letters contained 
multiple comments, some of which applied to the docket to which the 
letter was submitted, and some of which applied to a different docket. 
For example, we received several letters in the docket for the 
temporary interim rule titled ``Implementation of National Maritime 
Security Initiatives'' that contained comments in that temporary 
interim rule, plus comments on the ``Vessel Security'' temporary 
interim rule. We have addressed individual comments in the preamble to 
the appropriate final rule. Additionally, we had several commenters 
submit the same comment to all six dockets. We counted these duplicate 
submissions as only one letter, and we addressed each comment within 
that letter in the preamble for the appropriate final rule. Because of 
statutorily imposed time constraints for publishing these regulations, 
we were unable to consider comments received after the period for 
receipt of comments closed on July 31, 2003.
    A public meeting was held in Washington, DC, on July 23, 2003, and 
approximately 500 people attended. Comments from the public meeting are 
also included in the ``Discussion of Comments and Changes'' section.
    In order to focus on the changes made to the regulatory text since 
the temporary interim rule was published, we have adopted the temporary 
interim rule and set out, in this final rule, only the changes made to 
the temporary interim rule. To view a copy of the complete regulatory 
text with the changes shown in this final rule, see http://www.uscg.mil/hq/g-m/mp/index.htm.

Background and Purpose

    In the aftermath of September 11, 2001, the Commandant of the Coast 
Guard reaffirmed the Coast Guard's Maritime Homeland Security mission 
and its lead role-in coordination with the Department of Defense; 
Federal, State, Indian Tribal, and local agencies; owners and operators 
of vessels and marine facilities; and others with interests in our 
nation's Marine Transportation System (MTS)--to detect, deter, disrupt, 
and respond to attacks against U.S. territory, population, vessels, 
facilities, and critical maritime infrastructure by terrorist 
organizations.
    In November 2001, the Commandant of the Coast Guard addressed the 
International Maritime Organization (IMO) General Assembly, urging that 
body to consider an international scheme for port and shipping 
security. Recommendations and proposals for comprehensive security 
requirements, including amendments to the International Convention for 
Safety of Life at Sea, 1974, (SOLAS) and the new International Ship and 
Port Facility Security Code (ISPS Code), were developed at a series of 
intersessional maritime security work group meetings held at the 
direction of the IMO's Maritime Safety Committee.
    The Coast Guard submitted comprehensive security proposals in 
January 2002 to the intersessional maritime security work group 
meetings based on work we had been coordinating since October 2001. 
Before each intersessional meeting, the Coast Guard held public 
meetings and coordinated several outreach meetings with representatives 
from major U.S. and foreign associations for shipping, labor, and 
ports. We also discussed maritime security at each of our Federal 
Advisory Committee meetings and held meetings with other Federal 
agencies with security responsibilities.
    On January 28-30, 2002, the Coast Guard held a public workshop in 
Washington, DC, attended by more than 300 individuals, including 
members of the public and private sectors, and representatives of the 
national and international marine community (66 FR 65020, December 17, 
2001; docket number USCG-2001-11138). Their comments indicated the need 
for specific threat identification, analysis of threats, and methods 
for developing performance standards to plan for response to maritime 
threats. Additionally, the public comments stressed the importance of 
uniformity in the application and enforcement of requirements and the 
need to establish

[[Page 60449]]

threat levels with a means to communicate threats to the MTS.
    At the Marine Safety Committee's 76th session and subsequent 
discussions internationally, we considered and advanced U.S. proposals 
for maritime security that took into account this public and agency 
input. The Coast Guard considers both the SOLAS amendments and the ISPS 
Code, as adopted by the IMO Diplomatic Conference in December 2002, to 
reflect current industry, public, and agency concerns. The entry into 
force date of both the ISPS Code and related SOLAS amendments is July 
1, 2004, with the exception of the Automatic Identification System 
(AIS). The AIS implementation date for vessels on international voyages 
was accelerated to no later than December 31, 2004, depending on the 
particular class of SOLAS vessel.
    Domestically, the Coast Guard had existing regulations for the 
security of large passenger vessels, found in 33 CFR parts 120 and 128. 
The Coast Guard issued complementary guidance in the Navigation and 
Vessel Inspection Circular (NVIC) 3-96, Change 1, Security for 
Passenger Vessels and Passenger Terminals. Prior to development of 
additional regulations, the Coast Guard, with input from the public, 
assessed the current state of port and vessel security and their 
vulnerabilities. To accomplish this, the Coast Guard conducted the 
previously mentioned January 2002 public workshop to assess existing 
MTS security standards and measures and to gather ideas on possible 
improvements. Based on the comments received at the workshop, the Coast 
Guard cancelled NVIC 3-96 (Security for Passenger Vessels and Passenger 
Terminals) and issued a new NVIC 4-02 (Security for Passenger Vessels 
and Passenger Terminals), which was developed in conjunction with the 
International Council of Cruise Lines, that incorporated guidelines 
consistent with international initiatives (the ISPS Code and SOLAS). 
Additional NVICs were also published to further guide maritime security 
efforts, including NVIC 9-02 (Guidelines for Port Security Committees, 
and Port Security Plans Required for U.S. Ports), NVIC 10-02 (Security 
Guidelines for Vessels), and NVIC 11-02 (Security Guidelines for 
Facilities). The documents are available in the public docket (USCG-
2002-14069) for review at the locations under ADDRESSES.

Organization

    We have kept the maritime security regulations segmented in six 
separate final rules. For ease of reading and comprehension, the final 
rules carry the same organization as the temporary interim rules. Five 
of the final rules complete the new subchapter H, which was added by 
the temporary interim rules, in chapter I of title 33 of the Code of 
Federal Regulations (subchapter H). The final rule ``Automatic 
Identification System; Vessel Carriage Requirement'' (USCG-2003-14757), 
published elsewhere in today's Federal Register, finalizes the changes 
made to parts 26, 161, 164, and 165 in Title 33 of the Code of Federal 
Regulations regarding AIS. A brief description of each of the six final 
rules follows:
    1. Implementation of National Maritime Security Initiatives. In the 
preamble to this final rule (USCG-2003-14792), we discuss the 
background and purpose for all of the final rules. We discuss the 
comments and changes made to parts 101 and 102 of the new subchapter H. 
We also include a summary of the costs and benefits associated with 
implementing the requirements of subchapter H, as well as the AIS final 
rule.
    2. Area Maritime Security (AMS). In the preamble of the ``Area 
Maritime Security'' final rule (USCG-2003-14733), found elsewhere in 
today's Federal Register, we discuss the comments and changes made to 
part 103 of subchapter H and discuss the cost and benefit assessment 
specific to that part.
    3. Vessel Security. In the preamble of the ``Vessel Security'' 
final rule (USCG-2003-14749), found elsewhere in today's Federal 
Register, we discuss the comments and changes made to part 104 of 
subchapter H, to 33 CFR part 160, and to 46 CFR parts 2, 31, 71, 91, 
115, 126, and 176. We also discuss the cost and benefit assessments 
specific to those parts.
    4. Facility Security. In the preamble of the ``Facility Security'' 
final rule (USCG-2003-14732), found elsewhere in today's Federal 
Register, we discuss the comments and changes made to part 105 of 
subchapter H and discuss the cost and benefit assessments specific to 
that part.
    5. Outer Continental Shelf (OCS) Facility Security. In the preamble 
of the ``Outer Continental Shelf Facility Security'' final rule (USCG-
2003-14759), found elsewhere in today's Federal Register, we discuss 
the comments and changes to part 106 of subchapter H and discuss the 
cost and benefit assessments specific to that part.
    6. Automatic Identification Systems (AIS). In the preamble of the 
``Automatic Identification System; Vessel Carriage Requirement'' final 
rule (USCG-2003-14757), found elsewhere in today's Federal Register, we 
discuss the comments and changes made to 33 CFR parts 26, 161, 164, and 
165 and discuss the cost and benefit assessments specific to those 
parts.

Coordination With SOLAS Requirements

    For each of the final rules, the requirements of the Maritime 
Transportation Security Act (MTSA), section 102, align, where 
appropriate, with the security requirements in the SOLAS amendments and 
the ISPS Code. However, the MTSA has a broader application that 
includes domestic vessels and facilities. Thus, where appropriate, we 
have implemented the MTSA through the requirements in the SOLAS 
amendments and the ISPS Code, parts A and B. Further discussion on this 
coordination can be found in the preamble of the temporary interim rule 
titled ``Implementation of National Maritime Security Initiatives'' 
(USCG-2003-14792), under ``Coordination with SOLAS Requirements.''

Discussion of Comments and Changes

    Comments from each of the temporary interim rules and from the 
public meeting held on July 23, 2003, have been grouped by topic and 
addressed within the preambles to the applicable final rules. If a 
comment applied to more than one of the six rules, we discussed it in 
the preamble to each of the final rules that it concerned. For example, 
discussions of comments that requested clarification or changes to the 
Declaration of Security procedures are duplicated in the preambles to 
parts 104, 105, and 106. Several comments were submitted to a docket 
that included topics not addressed in that particular rule, but were 
addressed in one or more of the other rules. This was especially true 
for several comments submitted to the docket of part 101 (USCG-2003-
14792). In such cases, we discussed the comments only in the preamble 
to each of the final rules that concerned the topic addressed.

Subpart A--General

    This subpart concerns definitions, applicability, equivalents, and 
other subjects of a general nature applicable to all of subchapter H.
    Two commenters requested that the authority citation for 46 CFR 
part 107 include the following citations: 46 U.S.C. Chapter 701; 
Executive Order 12234; 45 FR 58801; 3 CFR, 1980 Comp., p. 277; 
Executive Order 12777, 56 FR 54757, 3 CFR, 1991 Comp., p. 351; and 
Department of Homeland Security Delegation No. 0170.1.

[[Page 60450]]

    We are not amending the authority citation because the regulations 
in 46 CFR part 107 are not issued under the citations that the 
commenters propose to add. Additionally, these changes are beyond the 
scope of this final rule.
    We received five comments regarding our implementation of the 
regulations. Three commenters strongly supported the implementation of 
the rules, stating that maritime entities should be regulated by a 
single law. One commenter supported the Coast Guard's implementation of 
the regulations as written, because of a security breach that occurred 
on a ferry within the past year. One commenter acknowledged and 
commended the Coast Guard for the positive way it responded to 
previously submitted comments.
    Two commenters commended the Coast Guard for ensuring that the 
interim rules resembled, in large part, the requirements adopted in the 
SOLAS amendments and the ISPS Code.
    We received 10 comments on the Coast Guard's interaction with other 
Federal agencies. Seven commenters pointed out the need for consistency 
and integration throughout the Department of Homeland Security (DHS) 
and other Federal agencies in matters affecting maritime security. 
Another commenter asked us to work with the Nuclear Regulatory 
Commission to develop consistent and compatible regulations. One 
commenter stated that the Coast Guard should develop a memorandum of 
understanding with the Bureau of Customs and Border Protection (BCBP) 
to clarify the roles of the two agencies.
    We agree with the commenters regarding the need for consistency and 
integration throughout DHS and other Federal agencies. In developing 
our regulations, we worked closely with many other agencies of DHS 
(e.g., the Transportation Security Administration (TSA), BCBP), the 
Department of Transportation (DOT) (e.g., the Maritime Administration 
(MARAD), the Research and Special Programs Administration (RSPA)), the 
Environmental Protection Agency (EPA), the Department of Energy (DOE), 
and the Minerals Management Service (MMS), among others. These 
regulations reflect input from all the Federal agencies that have a 
responsibility in the development and implementation of homeland 
security regulations covering all modes of transportation. We intend to 
continue these close working relationships as additional issues come to 
light, and we will continue to define each of our roles to ensure 
coordination and avoid duplication. Coordination with State and local 
agencies will be addressed in the plan developed by each AMS Committee, 
which is established by the cognizant COTP.
    We received comments from EPA regarding the effects of our 
regulations on EPA-regulated oil facilities. These comments focused 
primarily on the potential overlapping provisions of 33 CFR part 105 
and 40 CFR part 112. Overlap exists in four major areas: Notification 
of security incidents, fencing and monitoring, evacuation procedures, 
and security assessments. In cases of overlapping provisions for oil 
facilities regulated both in parts 105 and 112, the requirements in our 
final rules and EPA rulemakings do not supplant one another. 
Additionally, an EPA-regulated facility need not amend the facility's 
Spill Prevention Control and Countermeasure Plan or Facility Response 
Plan, as we first stated in the temporary interim rule (68 FR 39251) 
(part 101). We will be working further with EPA in the implementation 
of these final rules to minimize the burden to the facilities while 
ensuring that these facilities are secure. It is our belief that 
response plans for EPA-regulated oil facilities will serve as an 
excellent foundation for security plans that may be required under our 
regulations.
    EPA asked for clarification for facilities adjacent to the 
navigable waters that handle or store cargo that is hazardous or a 
pollutant but may not be marine transportation related facilities. 
These facilities are covered by parts 101 through 103 of subchapter H 
and, although there are no specific security measures for them in these 
parts, the AMS Plan may set forth measures that will be implemented at 
the various Maritime Security (MARSEC) Levels that may apply to them. 
The AMS Assessment may reveal that these EPA-regulated facilities may 
be involved in a transportation security incident and the COTP may 
direct these facilities, through orders issued under existing COTP 
authority, to implement security measures based on the facilities' 
operations and the MARSEC Level. We encourage owners and operators of 
these EPA-regulated facilities, as well as representatives from EPA, to 
participate in AMS Committee activities.
    EPA asked for further clarification on drills and exercises 
requirements. As we stated in the temporary interim rule, non-security 
drills and exercises may be combined with security drills to minimize 
burden. Additionally, EPA-regulated facilities that conduct drills not 
related to security are encouraged to communicate with the local COTP 
and coordinate their drills at the area level. It is our intention to 
give facilities and vessels in the port area as much notice as 
practicable prior to an AMS Plan exercise to reduce the burden to those 
entities. Again, we encourage owners and operators of these EPA-
regulated facilities, and EPA, to participate in AMS Committee 
activities to maximize coordination and minimize burden.
    EPA asked us to clarify the role of Area Contingency Plans with the 
requirements of our final rules. Our rules are intended to work in 
concert with Area Contingency Plans and do not preempt their 
requirements. We envision that many members of the Area Committees who 
are responsible for implementing Area Contingency Plans will also 
become members of the AMS Committee. This participation will help 
ensure that implementing an AMS Plan will not conflict with an Area 
Contingency Plan.
    Finally, EPA asked for clarification on requirements for marine 
transportation related facilities that handle petroleum oil, non-
petroleum oil, and edible oil. These facilities are directly regulated 
under Sec.  105.105(a)(1) and must meet the requirements of part 105.
    One commenter emphasized the importance of working with State 
homeland security representatives to resolve any State and local issues 
or barriers that might interfere with providing appropriate security 
for the maritime industry.
    We stated in the temporary interim rule (68 FR 39255) (part 101) 
that we consider standards for private security guards a matter of 
private contract and of State and local law. We believe that it is 
important to encourage the review of these standards, and therefore 
intend to work with State homeland security representatives to resolve 
any issues or barriers with regard to these State and local standards.
    Two commenters requested that we add to Sec.  101.100 a new 
paragraph that would read: ``maritime security plans developed under 
these regulations and approved by the Coast Guard prepare vessel owners 
and operators, vessel crews, facility owners and operators, and 
facility personnel to deter to the maximum extent practicable maritime 
security incidents. The security measures identified in the plans 
provide deterrence and are not performance standards. The plans are 
approved on a set of assumptions regarding the security vulnerabilities 
recognized at the time of approval that may not be valid in an actual 
maritime security incident.'' The commenters stated that this paragraph 
would mirror the language of OPA 90 and clarify the intent of the 
subchapter.
    We agree, in part, with the commenters and have amended

[[Page 60451]]

Sec.  101.100. However, to remain broad and consistent with the tone of 
the subchapter, we have rephrased the concept. In addition, we have 
made an editorial correction to Sec.  101.100(a) to clarify that the 
``purpose'' section applies to the entire subchapter.
    The following discussion on Sec.  101.105, Definitions, is detailed 
alphabetically to align, as much as possible, with the order of the 
terms listed in the section.
    Two commenters recommended deleting the language in the definition 
of Sec.  101.105 that explains that an AMS Committee can be a Port 
Security Committee established pursuant to NVIC 09-02, noting that this 
additional language is adequately covered by the regulations in part 
103.
    We agree that the additional language in the definition of AMS 
Committee is adequately explained in part 103, but we prefer to include 
this language for absolute clarity.
    After reviewing the applicability of this subchapter to barge 
fleeting facilities, we determined that our reference to the Army Corps 
of Engineers permitting regulations in 33 CFR part 322 was not a 
complete representation of inland river permitting practices. 
Therefore, we have amended the definition of ``barge fleeting 
facility'' to clarify that these regulations apply to any barge 
fleeting facility permitted by the Army Corp of Engineers, whether 
under an individual permit, or a national or regional general permit. 
We believe that any barge fleeting area constitutes an obstacle under 
the definition of ``structure'' found in the Army Corps of Engineers 
regulations at 33 CFR 322.2.
    One commenter asked us to define ``breach of security'' to clarify 
the intent of the regulations.
    We agree with the commenter, and have added a definition for 
``breach of security'' to Sec.  101.105.
    After reviewing the applicability of this subchapter to certain 
industrial vessels, we determined that vessels operating solely with 
dredge spoils may not be involved in a transportation security 
incident. Therefore, we amended the definition of ``cargo'' to clarify 
that dredge spoils are not considered cargo for purposes of part 104 of 
this chapter. This has the effect of removing certain dredges from 
coverage under part 104.
    Eleven commenters requested that the Coast Guard clarify ``Certain 
Dangerous Cargo'' (CDC), stating that the rules should have one 
definition.
    There is one definition for CDC that applies to all of the security 
regulations in subchapter H. Section 101.105 defines CDC as meaning 
``the same as defined in 33 CFR 160.203.'' These comments revealed the 
need to correct the citation; the correct reference should be Sec.  
160.204, rather than Sec.  160.203. We have amended Sec.  101.105 
accordingly. It should be noted that this change ensures consistency in 
Title 33. We are constantly reviewing and, when necessary, revising the 
CDC list based on additional threat and technological information. 
Changes to Sec.  160.204 would affect the regulations in 33 CFR 
subchapter H because any changes to the CDC list would also affect the 
applicability of subchapter H. Any such changes would be the subject of 
a future rulemaking.
    One commenter requested that the Company Security Officer be 
allowed to liaise with the Coast Guard at the District, Area, or 
Headquarters level rather than the local COTP.
    We agree that effective communication may be established between 
the Company Security Officer and one or more COTPs and that for some 
companies, effective communications with the Coast Guard may be at the 
District, Area, or Headquarters level; therefore, we are amending the 
definition of ``Company Security Officer'' in Sec.  101.105 to remove 
the specific reference to the COTP.
    After further review of the regulations, we are adding the 
definition of ``dangerous goods and/or hazardous substances'' to 
clarify the use of that term within the regulations.
    Three commenters asked for clarification on dangerous substances 
and devices. Two commenters stated that the definition of ``Dangerous 
substances and devices'' is too broad and could be construed to include 
illegal drugs, plants, ``and even Cuban cigars.'' The commenter noted, 
``normal screening methods (x-ray and explosive-sniffing canines or 
wands) will not detect 'substances' nor are they necessarily an item 
that will cause `damage or injury.' '' The commenter recommended 
amending the definition of ``Dangerous substances and devices'' to: (1) 
Specify that such substances and devices included only those that have 
``the potential to cause a transportation security incident''; (2) add 
weapons, incendiaries, and explosives; and (3) specify that such 
substances and devices do not include drugs, alcohol, or ``other 
chemical or biological items not normally associated with 
transportation security screening.'' One commenter asked how to handle 
legal dangerous substances, such as fertilizer and gasoline.
    We agree that the definition of dangerous substances and devices 
could be subject to differing interpretations. We therefore revised and 
simplified this definition by relating it to the potential of the 
dangerous substance or device to cause a transportation security 
incident similar to the commenter's recommendation. However, we 
disagree that we need to expressly exclude the items suggested because 
a transportation security incident is defined as a security incident 
resulting in a ``significant'' loss of life, environmental damage, 
transportation system disruption, or economic disruption in a 
particular area. We believe the definition of a transportation security 
incident is such that alcoholic beverages and drugs could not be 
interpreted as dangerous substances and devices as the term has been 
redefined. Such dangerous substances and devices would include, but not 
be limited to, explosives, incendiaries, and assault weapons.
    One commenter asked to clarify the difference between ``vessel-to-
vessel activity,'' as defined in Sec.  101.105, and ``vessel-to-vessel 
interface,'' as used in part 104.
    We find that the terms ``vessel-to-vessel activity'' and ``vessel-
to-vessel interface'' are comparable and have chosen to use the term 
``vessel-to-vessel activity'' to align these regulations with the ISPS 
Code. We have amended the definition of ``Declaration of Security'' in 
Sec.  101.105 as well as Sec. Sec.  104.105 and 104.255 to use the term 
``vessel-to-vessel activity'' in place of ``vessel-to-vessel 
interface,'' for consistency.
    We received 26 comments dealing with the definition of 
``facility.'' One commenter asked whether a facility that is inside a 
port that handles cargo or containers, but does not have direct water 
access, is covered under the definition of facility. Another commenter 
recommended that the definition specify that facilities without water 
access and that do not receive vessels be exempt from the requirements. 
One commenter asked whether small facilities, located inland on a 
river, would be subject to part 105 if they receive vessels greater 
than 100 gross registered tons on international voyages. One commenter 
asked whether a company that receives refined products via pipeline 
from a dock facility that the company does not own qualifies as a 
regulated facility. One commenter asked whether part 105 applies to 
facilities at which vessels do not originate or terminate voyages. Two 
commenters stated that the word ``adjacent'' in the definition should 
be changed to read ``immediately adjacent'' to the ``navigable 
waters.'' One commenter suggested that, in the definition, the word 
``adjacent'' be

[[Page 60452]]

defined in terms of a physical distance from the shore and the terms 
``on, in or under'' and ``waters subject to the jurisdiction of the 
U.S.'' be clarified. Two commenters understand the definition of 
``facility'' to possibly including overhead power cables, underwater 
pipe crossings, conveyors, communications conduits crossing under or 
over the water, or a riverbank. One commenter asked for a blanket 
exemption for electric and gas utilities. One commenter suggested 
rewriting the applicability of ``facilities'' in plain language or, 
alternatively, providing an accompanying guidance document to help 
owner and operators determine whether their facilities are subject to 
these regulations. One commenter asked us to clarify which facilities 
might ``qualify'' for future regulation and asked us to undertake a 
comprehensive review of security program gaps and overlaps, in 
coordination with DHS. One commenter stated that a facility that 
receives only vessels in ``lay up'' or for repairs should not be 
required to comply with part 105.
    We recognize that the definition of ``facility'' in Sec.  101.105 
is broad, and we purposefully used this definition to be consistent 
with existing U.S. statutes regarding maritime security. A facility 
within an area that is a marine transportation related terminal or that 
receives vessels over 100 gross tons on international voyages is 
regulated under Sec.  105.105. All other facilities in an area not 
directly regulated under Sec.  105.105, such as some adjacent 
facilities and utility companies, are covered under parts 101 through 
103. If the COTP determines that a facility with no direct water access 
may pose a risk to the area, the facility owner or operator may be 
required to implement security measures under existing COTP authority. 
With regard to facilities that receive only vessels in ``lay up'' or 
for repairs, we amended the regulations to define, using the definition 
of a general shipyard facility from 46 CFR 298.2, and exempt general 
shipyard facilities from the requirements of part 105 unless the 
facility is subject to 33 CFR parts 126, 127, or 154 or provides any 
other service beyond those services defined in Sec.  101.105 to any 
vessel subject to part 104. In a similar manner, in part 105, we are 
also exempting facilities that receive vessels certificated to carry 
more than 150 passengers if those vessels do not carry passengers while 
at the facility nor embark or disembark passengers from the facility. 
We exempted facilities that receive vessels for lay-up, dismantling, or 
placing out of commission to be consistent with the other changes we 
have discussed above. The facilities listed in the amended Sec. Sec.  
105.105 and 105.110 will be covered by the AMS Plan, and we intend to 
issue further guidance on addressing these facilities in the AMS Plan. 
Finally, while not in ``plain language'' format, we have attempted to 
make these regulations as clear as possible. We have created Small 
Business Compliance Guides, which should help facility owners and 
operators determine if their facilities are subject to these 
regulations. These Guides are available where listed in the 
``Assistance for Small Entities'' section of this final rule.
    Five commenters recommended changes to the definitions of 
``facility'' and ``OCS facility'' in Sec.  101.105 in order to clarify 
the applicability of parts 104, 105, and 106 to Mobile Offshore 
Drilling Units (MODUs). Two commenters suggested adding language to the 
facility definition to specifically include MODUs that are not 
regulated under part 104, consistent with the definition of OCS 
facility. Another commenter stated that if we change the definition to 
include MODUs not regulated under part 104, then we also should add an 
explicit exemption for these MODUs from part 105. Three commenters 
suggested deleting the words ``fixed or floating'' and the words 
``including MODUs not subject to part 104 of this subchapter'' in Sec.  
106.105 and adding a paragraph to read ``the requirements of this part 
do not apply to a vessel subject to part 104 of this subchapter.''
    With regard to the definition of ``facility'' and the suggested 
additional language regarding MODUs, the definition clearly 
incorporates MODUs that are not covered under part 104 and MODUs are 
sufficiently covered under parts 101 through 103 and 106. Therefore, we 
are not amending our definition of facility nor incorporating the 
suggested explicit exemption from part 105 because these MODUs are 
excluded. We have, however, amended the applicability section of part 
104 (Sec.  104.105) so that foreign flag, non-self propelled MODUs that 
meet the threshold characteristics set for OCS facilities are regulated 
by 33 CFR part 106, rather than 33 CFR part 104. We have done so 
because MODUs act and function more like OCS facilities, have limited 
interface activities with foreign and U.S. ports, and their personnel 
undergo a higher level of scrutiny to obtain visas to work on the Outer 
Continental Shelf. These amendments to Sec.  104.105 required us to add 
a definition for ``cargo vessel'' in Sec.  101.105. With these changes, 
we believe the existing definitions of ``facility'' and ``OCS 
facility'' in Sec.  101.105 are sufficient to conclusively identify 
those entities that are subject to parts 104, 105, and 106. In 
addition, the definition of ``OCS facility,'' as written, ensures that 
these entities will be subject to relevant elements of an OCS Area 
Maritime Security Plan. We believe the language in Sec.  106.105, read 
in concert with the amended Sec.  104.105(a)(1), and the existing 
definitions in part 101, is sufficient to preclude MODUs that are in 
compliance with part 104 from being subject to part 106.
    Two commenters stated that our definition of ``international 
voyage'' includes voyages made by vessels that solely navigate the 
Great Lakes and St. Lawrence River. The commenter contended that SOLAS 
specifically exempts vessels that navigate in this area from all the 
requirements of SOLAS.
    We are aware that vessels on the Great Lakes and St. Lawrence 
Seaway, which are otherwise exempted from SOLAS, are required to comply 
with our regulations. We have amended the definition of ``international 
voyage'' in Sec.  101.105 to make this clear. We do not believe that we 
can require lesser security measures for certain geographic areas, such 
as the Great Lakes and the St. Lawrence Seaway, and still maintain 
comparable levels of security throughout the maritime domain. In 
addition, while SOLAS does not typically apply to the Great Lakes and 
St. Lawrence Seaway, it allows contracting governments to determine 
appropriate applicability for their national security. For the U.S., 
the MTSA does not exempt geographic areas from maritime security 
requirements. If vessel owners or operators believe that any vessel 
security requirements are unnecessary due to their operating 
environment, they may apply for a waiver under the procedures allowed 
in Sec.  104.130. Additionally, vessel owners or operators may submit 
for approval an Alternative Security Program to apply to vessels that 
operate solely on the Great Lakes and St. Lawrence Seaway.
    Two commenters proposed language to clarify the definition of ``OCS 
facility'' to make clear that the term includes MODUs when attached to 
the subsoil or seabed for the exploration, development, or production 
of oil or natural gas. One commenter suggested that this additional 
language would ``provide clarification regarding the applicability of'' 
part 106.
    The purpose of the broad definition of ``OCS facility'' in Sec.  
101.105 is to incorporate all such facilities so that the OCS 
facilities that are not regulated under part 106 will be regulated 
under

[[Page 60453]]

parts 101 through 103. The proposed additional language would not add 
clarity to part 106 because the applicability in Sec.  106.105 states 
that the section applies only to those MODUs that are operating for the 
purposes of engaging in the exploration, development, or production of 
oil, natural gas, or mineral resources.
    Two commenters asked the Coast Guard to change the language in 
Sec.  104.400(a) to delineate the responsibilities of towing vessels 
and facilities when dealing with unmanned vessels.
    We are amending the definition of ``owner or operator'' in Sec.  
101.105 to clarify when ``operational control'' of unmanned vessels 
passes between vessels and facilities. No change was made to Sec.  
104.400(a) because the change to the definition of ``owner or 
operator'' addresses this concern.
    Two commenters suggested amending the definition of ``owner or 
operator'' so that the definition includes, for OCS facilities: ``the 
lessee or the operator designated to act on behalf of the lessee in 
accordance with 30 CFR part 250.'' One commenter sought clarification 
of the terms ``owner or operator'' and suggested adding ``operational 
control is the ability to influence or control the physical or 
commercial activities pertaining to that facility for any period of 
time.''
    We disagree with adding the suggested language of the first 
commenter because we have concluded that the owner and the person with 
operational control are in the best position to implement these 
regulations and, therefore, should be responsible for implementation. 
The language proposed would include a lessee regardless of whether or 
not that lessee maintains such operational control. We also disagree 
with adding the suggested language of the second comment because it 
does not provide for security activities in addition to the physical or 
commercial activities.
    After further review of the definition for passenger vessel, we 
determined that a clarification was needed with respect to vessels on 
international voyages. In the temporary interim rule we unintentionally 
included all vessels carrying more than 12 passengers because we did 
not specify that a vessel on an international voyage would be deemed a 
passenger vessel only if it carried a passenger-for-hire. We have 
amended the definition to clarify that when a vessel is on an 
international voyage carrying more than 12 passengers, a vessel is 
considered a passenger vessel only if one of those passengers is a 
passenger-for-hire. We have made a conforming amendment to Sec.  
104.105.
    Three commenters requested that the Coast Guard clarify the term 
``persons'' to exclude crewmembers.
    We do not provide a specific definition for the term ``persons'' in 
these rules. It was our intent for the word ``persons'' to include 
crewmembers.
    We received five comments regarding the use of the word ``port'' in 
the regulations. Four commenters requested that we amend many sections 
of parts 101 and 103 to remove the word ``port'' from the regulatory 
text, stating that parts 101 and 103 are not necessarily applicable to 
just ports, but to an area as a whole. One commenter recommended that 
we include definitions for ``Seaport,'' ``Port Authority,'' ``Port 
Director,'' and ``Seaport Security Assessment/Plan,'' stating that a 
seaport can act as its own legal entity and enforce its own laws and 
regulations.
    As described in the temporary interim rule in part 101, Table 4 (68 
FR 39266-39267), ``area maritime,'' ``port,'' and ``port facility'' are 
comparable, and we do not believe the recommended editorial changes add 
significant value or clarity. In addition, adding definitions 
incorporating ``seaport,'' as suggested, is less inclusive than what is 
addressed in the MTSA. Furthermore, this concept does not align with 
the ISPS Code. We are not, therefore, amending parts 101 or 103.
    Six commenters stated that part 105 should not apply to marinas 
that receive a small number of passenger vessels certificated to carry 
more than 150 passengers or to ``mixed-use or special-use facilities 
which might accept or provide dock space to a single vessel'' because 
the impact on local business in the facility could be substantial. Two 
commenters stated that private and public riverbanks should not be 
required to comply with part 105 because ``there is no one to complete 
a Declaration of Security with, and no way to secure the area, before 
the vessel arrives.'' Two commenters stated that facilities that are 
``100 percent public access'' should not be required to comply with 
part 105 because these types of facilities are ``vitally important to 
the local economy, as well as to the host municipalities.'' This 
commenter also stated that vessels certificated to carry more than 150 
passengers frequently embark guests at private, residential docks and 
small private marinas for special events such as weddings and 
anniversaries and may visit such a dock only once.
    We agree that the applicability of part 105 to facilities that have 
minimal infrastructure, but are capable of receiving passenger vessels, 
is unclear. Therefore, we added a definition in part 101 for a ``public 
access facility'' to mean a facility approved by the cognizant COTP 
with public access that is primarily used for purposes such as 
recreation or entertainment and not for receiving vessels subject to 
part 104. By definition, a public access facility has minimal 
infrastructure for servicing vessels subject to part 104 but may 
receive ferries and passenger vessels other than cruise ships, ferries 
certificated to carry vehicles, or passenger vessels subject to SOLAS. 
Minimal infrastructure would include, for example, bollards, docks, and 
ticket booths, but would not include, for example, permanent structures 
that contain passenger waiting areas or concessions. We have not 
allowed public access facilities to be designated if they receive 
vessels such as cargo vessels because such cargo-handling operations 
require additional security measures that public access facilities 
would not have. We amended part 105 to exclude these public access 
facilities, subject to COTP approval, from the requirements of part 
105. We believe this construct does not reduce security because the 
facility owner or operator or entity with operational control over 
these types of public access facilities still has obligations for 
security that will be detailed in the AMS Plan, based on the AMS 
Assessment. Additionally, Vessel Security Plans must address security 
measures for using the public access facility. This exemption does not 
affect existing COTP authority to require the implementation of 
additional security measures to deal with specific security concerns. 
We have also amended Sec.  103.505, to add public access facilities to 
the list of elements that must be addressed within the AMS Plan.
    One commenter noted that in the definition of ``transportation 
security incident,'' there should be a clear definition of the specific 
event or events the Coast Guard is trying to avoid or prevent, stating 
that for some of these events, industry already has good mitigation 
strategies in place that might avoid the need to add additional 
security measures.
    The event that the Coast Guard is trying to avoid or prevent is a 
transportation security incident, which is a security incident 
resulting in a significant loss of life, environmental damage, 
transportation system disruption, or economic disruption in a 
particular area. As indicated in the

[[Page 60454]]

temporary interim rule (68 FR 39272) (part 101), we acknowledged that 
``many companies already have spent a substantial amount of money and 
resources to improve and upgrade security.'' These improvements will be 
taken into account in their Vessel or Facility Security Assessments and 
subsequent security plan development.
    One commenter suggested that the definition of ``unaccompanied 
baggage'' be revised to include baggage for which there is no 
accompanying passenger or crewmember. The commenter also noted that, if 
read literally, the definition in Sec.  101.105 would include all 
passenger baggage already ``checked,'' and therefore separated from its 
owner. The suggested definition was the following: ``baggage that was 
to be carried on board the ship when no passenger or crewmember was 
traveling on the same voyage or portion of that voyage.''
    We agree that ``unaccompanied baggage'' should include baggage for 
which there is not an accompanying passenger or crewmember. With regard 
to ``checked'' baggage, our definition aligns with the ISPS Code, part 
B. ``Checked'' baggage at the point of inspection or screening should 
be with a crewmember or other person and therefore remains accompanied. 
After inspection or screening, the baggage will be controlled until it 
is loaded on the vessel. We have amended the definition of 
``unaccompanied baggage'' to reflect the above and clarified the 
reference to an ``other person.''
    One commenter asked us not to change the definition of ``vessel 
stores'' as published in the temporary interim rule.
    The definition of ``vessel stores'' remains the same as published 
in the temporary interim rule (68 FR 39281) (part 101).
    We received 11 comments relating to the use of the terms ``vessel-
to-facility interface,'' ``vessel-to-port interface,'' and ``vessel-to-
vessel activity.'' Seven commenters requested that the Coast Guard be 
consistent in its use of ``vessel-to-vessel interface'' in Sec.  
101.105 and use the word ``cargo'' instead of the phrase ``goods or 
provisions.'' One commenter asked us to modify the definition of a 
``vessel-to-vessel activity'' to include the transfer of a container to 
or from a manned or unmanned vessel. One commenter noted that it should 
be made clear that the term ``vessel-to-facility interface'' refers to 
when the vessel is at the facility or arriving at the facility.
    We agree with the commenters. We have amended the definitions for 
``vessel-to-facility interface,'' ``vessel-to-port interface,'' and 
``vessel-to-vessel activity'' in Sec.  101.105 to use the words 
``cargo'' and ``vessel stores'' instead of the word ``goods'' to be 
clearer for the intended activities. The term ``vessel-to-facility 
interface'' clearly states that the vessel is either at, or arriving 
at, the facility, and therefore, we did not amend the definition 
further.
    Five commenters requested that we amend the definition of ``waters 
subject to the jurisdiction of the United States'' to simply refer to 
the definition of that term in 33 CFR 2.38, stating that doing so would 
be less confusing. Four commenters asked us to clarify the term 
``superadjacent'' used in the same definition.
    The definition suggested by the commenter would exclude application 
of these regulations to the Exclusive Economic Zone (EEZ) and waters 
superjacent to the OCS. We believe that including the EEZ and the 
waters superjacent to the OCS is crucial to implementing the 
comprehensive security regime intended by the MTSA. It is also 
consistent with the Coast Guard's anti-terrorism authorities in 33 
U.S.C. 1226. However, we agree the definition is somewhat confusing and 
needs clarification. In the temporary interim rules, we defined 
``waters subject to the jurisdiction of the United States'' to include, 
in addition to the EEZ and the waters superjacent to the Outer 
Continental Shelf, the ``navigable waters'' as defined in 46 U.S.C. 
2101(17a). Navigable waters in this context, by reference to 
Presidential Proclamation No. 5928, extend to the full breadth of the 
territorial sea that is 12 nautical miles wide, adjacent to the coast 
of the United States, and seaward of the territorial sea baseline. We 
believe the better approach is to amend our recent recodification of 
jurisdictional terms in 33 CFR part 2 to reflect that, consistent with 
the temporary interim rules, the 12 nautical mile territorial sea 
applies not only to statutes under subtitle II of title 46 but also 
statutes under subtitle VI of title 46 (section 102 of the MTSA). Doing 
so simplifies the definition of ``waters subject to the jurisdiction of 
the United States'' for purposes of the regulations by permitting 
reference, in part, to an existing regulatory definition. The amended 
definition of ``waters subject to the jurisdiction of the United 
States'' reflects this change.
    Five commenters disagree with applying the same regulations to all 
segments of the maritime industry, stating that it is not practical. 
One of these commenters suggested that the regulations exempt entities, 
such as nuclear facilities covered under 10 CFR part 73 and 49 CFR part 
172, because they are already regulated.
    We developed these regulations to be tailored to diverse industries 
within the maritime community through various provisions, such as the 
Alternative Security Program. If a nuclear facility is involved in the 
activities regulated under part 105, then the facility must comply with 
that part. However, we have made multiple provisions within the 
regulations so entities that are already covered by other requirements 
for security should be able to coordinate their compliance with these 
rules and others they already have implemented.
    Two commenters were concerned about the breadth of the regulations. 
One commenter asked that the regulations be broadened to allow for 
exemptions. One commenter stated that the applicability as described in 
Sec.  101.110 is ``much too general,'' stating that it can be 
interpreted as including a canoe tied up next to a floating dock in 
front of a private home. The commenter concluded that such a broad 
definition would generate ``a large amount of confusion and 
discontent'' among recreational boaters and waterfront homeowners.
    Our applicability for the security regulations in 33 CFR chapter I, 
subchapter H, is for all vessels and facilities; however, parts 104, 
105, and 106 directly regulate those vessels and facilities we have 
determined may be involved in transportation security incidents, which 
does not include canoes and private residences. For example, Sec.  
104.105(a) applies to commercial vessels; therefore, a recreational 
boater is not regulated under part 104. If a waterfront homeowner does 
not meet any of the specifications in Sec.  105.105(a), the waterfront 
homeowner is not regulated under part 105. It should be noted that all 
waterfront areas and boaters are covered by parts 101 through 103 and, 
although there are no specific security measures for them in these 
parts, the AMS Plan may set forth measures that will be implemented at 
the various MARSEC Levels that may apply to them. Security zones and 
other measures to control vessel movement are some examples of AMS Plan 
actions that may affect a homeowner or a recreational boater. 
Additionally, the COTP may impose measures, when necessary, to prevent 
injury or damage or to address specific security concerns.
    Five commenters addressed the applicability of the regulations with 
respect to facilities and the boundaries of the Coast Guard 
jurisdiction relative to that of other Federal agencies. Four 
commenters advocated a ``firm line of

[[Page 60455]]

demarcation'' limiting the Coast Guard authority to the ``dock,'' 
because as the rule is now written, a facility may still be left to 
wonder which Federal agency or department might have jurisdiction over 
it when it comes to facility security. One commenter suggested that the 
Coast Guard jurisdiction should not extend beyond ``the first 
continuous access control boundary shore side of the designated 
waterfront facility.''
    Section 102 of the MTSA requires the Secretary of the Department in 
which the Coast Guard is operating to prescribe certain security 
requirements for facilities. The Secretary has delegated that authority 
to the Coast Guard. Therefore, the Coast Guard is not only authorized, 
but also required under the MTSA, to regulate beyond the ``dock.''
    Two commenters requested clarification on our reference to SOLAS 
and facility applicability. One commenter stated that because the 
applicability of the various chapters of SOLAS is not consistent, it is 
necessary to specify particular chapters in SOLAS to define the 
applicability of this regulation to U.S. flag vessels. The commenter 
requested that we limit the reference to SOLAS in Sec.  105.105(a)(3) 
to ``SOLAS Chapter XI-2.'' Another commenter stated that it is not 
clear whether the words ``greater than 100 gross registered tons'' 
applied to SOLAS vessels as well as to vessels that are subject to 33 
CFR Chapter I, subchapter I.
    We agree that the general reference to SOLAS is broad and could 
encompass more vessels than necessary. We have amended the 
applicability reference to read ``SOLAS Chapter XI'' because subchapter 
H addresses those requirements in SOLAS Chapter XI. Also, we have 
amended Sec.  105.105(a) to apply the term ``greater than 100 gross 
registered tons'' to facilities that receive vessels subject only to 
subchapter I. We did not include references to foreign or U.S. 
ownership in the applicability paragraphs because it is duplicative to 
the existing language.
    Thirty commenters commended the Coast Guard for providing an option 
for an Alternative Security Program as described in Sec.  101.120(b) 
and urged the Coast Guard to approve these programs as soon as 
possible.
    We believe the provisions in Sec.  101.120(b) will provide greater 
flexibility and will help owners and operators meet the requirements of 
these final rules. We will review Alternative Security Program 
submissions in a timely manner to determine if they comply with the 
security regulations for their particular industry segment. The Coast 
Guard has already received and begun reviewing Alternative Security 
Programs, and we have been able to approve three such programs. We have 
amended Sec.  101.125 to list those approved Alternative Security 
Programs. We will announce new approvals of Alternative Security 
Programs through the Federal Register, and intend to update Sec.  
101.125 on an annual basis.
    Twenty commenters requested clarification on the Alternative 
Security Program. Three commenters requested that the Coast Guard work 
with their industry association to come up with their own security 
program. Two commenters asked for guidance on how to implement an 
Alternative Security Program. One commenter stated that the Coast Guard 
should recognize its existing security programs. One commenter 
suggested that we allow owners or operators to use industry security 
standards, recommended practices, and guidelines as Alternative 
Security Programs. Four commenters requested that Alternative Security 
Programs be available to certain owners and operators of foreign flag 
vessels that are not subject to SOLAS. Three commenters asked for 
clarification as to which facilities are eligible to participate in an 
Alternative Security Program. One commenter recommended that the 
Alternative Security Program be available to vessels subject to SOLAS.
    We encourage industries to develop Alternative Security Programs 
that address those aspects of security unique to their industry. 
Section 101.120 allows industry associations to submit Alternative 
Security Programs to the Coast Guard for approval. As part of the 
review process, we will work with industry representatives to assure 
that Alternative Security Programs meet the requirements of the rules 
and ensure maritime security. We agree that the Alternative Security 
Program should be available to certain owners and operators of foreign 
flag vessels that are not subject to SOLAS and to facilities that serve 
vessels on international voyages. Because the AMS Plan will be the 
approved port facility security plan as described in the ISPS Code, 
part A, we have amended Sec.  101.120 to allow certain facilities that 
serve vessels subject to SOLAS Chapter XI the option of using an 
Alternative Security Program that has been reviewed and approved by the 
Coast Guard. We do not intend to allow vessels subject to SOLAS to use 
an Alternative Security Program. Two commenters stated that Sec.  
101.120 does not allow an industry association to submit an Alternative 
Security Program for approval. One commenter asked that the regulations 
for Alternative Security Programs be clarified to allow participants to 
carry a copy of the Coast Guard approved Alterative Security Program on 
board vessels or at facilities.
    Section 101.120(c) does not preclude an industry association from 
submitting an Alternative Security Program for approval. In addition, 
the regulations requiring the availability of the security plans on 
board the vessels or at the facility do not preclude the owner or 
operator of the vessel or facility from keeping a Coast Guard approved 
Alternative Security Program on board the vessel or at the facility. 
Furthermore, we have amended Sec.  101.120(b)(3) and added a new 
provision, Sec.  101.120(b)(4), to clarify that owners or operators 
implementing an Alternative Security Program must provide information 
to the Coast Guard when requested. This clarification was needed, among 
other things, to ensure that the Coast Guard has access to relevant 
information to assist our compliance and verification responsibilities. 
The information may also be needed to help the Coast Guard assess 
vulnerabilities, conduct an AMS Assessment, or develop an AMS or 
National Security Plan. Finally, after further review of parts 101 and 
104 through 106, we have amended Sec. Sec.  101.120(b)(3), 
104.120(a)(3), 105.120(c), and 106.115(c) to clarify that a vessel or 
facility that is participating in the Alternative Security Program must 
complete a vessel or facility specific security assessment report in 
accordance with the Alternative Security Plan, and it must be readily 
available.
    Three commenters stated that the cognizant COTP should be 
responsible for reviewing the submissions for the Alternative Security 
Program when the company operates exclusively in one COTP zone. The 
commenters noted that COTPs have the best knowledge of the vessels and 
facilities operating in their zone.
    We require that requests to implement an Alternative Security 
Program be submitted for approval to the Commandant (G-MP) because we 
want to ensure uniformity across all COTP zones in the implementation 
of this program. The Commandant (G-MP) will coordinate and consult with 
local COTPs, Districts, and Areas, as needed, on these submissions.
    After further review of Sec.  101.120, we are amending the section 
to provide a procedure for amending an Alternative Security Program, 
and to align the effective period of an Alternative Security Program 
with the 5-year period provided for other security plans. Additionally, 
after review of the

[[Page 60456]]

``Submission and approval'' requirements in Sec. Sec.  101.120, 
104.410, 105.410, and 106.410, we have amended the requirements to 
clarify that security plan submissions can be returned for revision 
during the approval process.
    We received seven comments regarding waivers, equivalencies, and 
alternatives. Three commenters appreciated the flexibility of the Coast 
Guard in extending the opportunity to apply for a waiver or propose an 
equivalent security measure to satisfy a specific requirement. Four 
commenters requested detailed information regarding the factors the 
Coast Guard will focus on when evaluating applications for waivers, 
equivalencies, and alternatives.
    The Coast Guard believes that equivalencies and waivers provide 
flexibility for vessel owners and operators with unique operations. 
Sections 104.130, 105.130, and 106.125 state that vessel or facility 
owners or operators requesting waivers for any requirement of part 104, 
105, or 106 must include justification for why the specific requirement 
is unnecessary for that particular owner's or operator's vessel or 
facility or its operating conditions. Section 101.120 addresses 
Alternative Security Programs and Sec.  101.130 provides for 
equivalents to security measures. We intend to issue guidance that will 
provide more detailed information about the application procedures and 
requirements for waivers, equivalencies, and the Alternative Security 
Program.
    One commenter requested that we allow a group of facilities that 
combine to act as an identified unit to be considered as an equivalency 
or add a definition of either ``port'' or ``port authority.'' The 
commenter also stated that part 105 should allow port security plans, 
developed by local government port authorities and approved by State 
authorities, to serve as equivalent security measures.
    We do not agree with adding a definition of ``port'' to recognize a 
group of facilities that combine to act as an identified unit. However, 
groups of facilities may work together to enhance their collective 
security and achieve the performance standards in the regulations. 
Locally developed port security plans may serve as an excellent 
starting point for those facilities located within the jurisdiction of 
a port authority. We believe that the provisions of Sec. Sec.  
105.300(b), 105.310(b), and 105.400(a) permit the COTP to approve a 
Facility Security Plan that covers multiple facilities, such as a co-
located group of facilities that share security arrangements, provided 
that the particular aspects and operations of each subordinate facility 
are addressed in the common assessment and security plan. A single 
Facility Security Officer for the port or cooperative should be 
designated to facilitate this common arrangement. Finally, local 
security programs developed by entities such as a port authority or a 
port cooperative may be submitted to the Coast Guard for consideration 
as Alternative Security Programs in accordance with Sec.  101.120(c).
    Six commenters asked that terms and definitions in the regulations 
match those in the ISPS Code, and not the terms and definitions in the 
MTSA, to minimize confusion among international companies. Two 
commenters stated that inclusion of the ISPS Code terms ``port facility 
security plan'' and ``port facility security officer'' in the 
definitions of AMS Plan and Federal Maritime Security Coordinator, 
respectively, in these regulations will cause confusion and is contrary 
to the intent of the ISPS Code.
    We recognize that it can be confusing for foreign flag vessels to 
operate under different definitions than those present in the ISPS 
Code. The ISPS Code, however, gives contracting governments latitude in 
implementing its provisions. At the same time, the MTSA imposes its own 
requirements. Our regulations align the requirements of both the ISPS 
Code and the MTSA, and the definitions used within the regulations 
reflect this alignment.
    We received several comments that were beyond the scope of this 
final rule. One commenter supported making foreign flag vessel owners, 
operators, and vessel managers financially accountable for the direct 
and indirect economic impacts resulting from a terrorist activity 
stemming from one of their company's managed commercial vessels. One 
commenter asked that their product be included as part of these final 
rules.
    Imposing these suggested financial obligations is beyond the scope 
of this final rule. There are, however, new provisions such as the 
continuous synopsis record (SOLAS Chapter XI-1, regulation 5) that 
effectively address ownership and identify those that may be 
responsible for the operation of the vessel. Product solicitations are 
also beyond the scope of this final rule and are not addressed.
    Three commenters questioned the foreign port assessment program. 
One commenter stated the U.S. assessment of foreign ports could create 
``too many layers'' of inspection, stating that the European Commission 
will assess the security of their own ports, and the U.S. assessment 
process is, therefore, duplicative. Two commenters recommended that the 
U.S. accept assessments of foreign ports by reputable maritime 
administrations in accordance with IMO requirements. One commenter 
expressed concerns regarding the Coast Guard's intention to conduct 
foreign port audits, and expressed hope that the U.S. would accept the 
International Labor Organization's (ILO) work on seafarer 
credentialing.
    The Coast Guard, in cooperation with TSA, BCBP, and MARAD, is still 
developing the foreign port assessment program to implement 46 U.S.C. 
70108. We intend to work cooperatively with officials in foreign ports 
and other organizations, such as the European Commission and ILO, to 
reduce unnecessary duplication in assessing the effectiveness of 
antiterrorism measures maintained at foreign ports and the 
credentialing of seafarers.

Subpart B--Maritime Security (MARSEC) Levels

    This subpart concerns the setting of MARSEC Levels.
    We received 15 comments regarding MARSEC Level alignment. One 
commenter agreed with the alignment. One commenter stated that 
Sec. Sec.  101.200 and 101.205 are inconsistent with one another. Six 
commenters stated that problems are likely to arise because MARSEC 
Levels do not match other Federal threat levels, such as the Homeland 
Security Advisory System (HSAS).
    We disagree with the dissenting commenters. Section 101.200(d) 
states that COTPs may temporarily raise the MARSEC Level for their 
specific areas of responsibility when necessary to address an exigent 
circumstance immediately affecting the security of the maritime 
elements of their areas of responsibility. This is a narrow set of 
circumstances; we expect national MARSEC Levels to be established at 
the level of the Commandant, as stated in Sec.  101.205. Additionally, 
as stated in Sec.  101.205, MARSEC Levels have been aligned with DHS's 
HSAS.
    In reviewing Table 101.205, we noted that the reference to the Blue 
HSAS threat condition should be ``guarded'' and reference to the Yellow 
HSAS threat condition should be ``elevated.'' We have amended Table 
101.205 to reflect this clarification.

Subpart C--Communication (Port-Facility-Vessel)

    This subpart concerns the communication of MARSEC Levels, threats, 
confirmations of attainment,

[[Page 60457]]

suspicious activities, breaches of security, and transportation 
security incidents.
    We received 28 comments regarding communication of changes in the 
MARSEC Levels. Most commenters were concerned about the Coast Guard's 
capability to communicate timely changes in MARSEC Levels to facilities 
and vessels. Some stressed the importance of MARSEC Level information 
reaching each port area in the COTP's zone and the entire maritime 
industry. Some stated that local Broadcast Notice to Mariners and 
MARSEC Directives are flawed methods of communication and stated that 
the only acceptable means to communicate changes in MARSEC Levels, from 
a timing standpoint, are via email, phone, or fax as established by 
each COTP.
    MARSEC Level changes are generally issued at the Commandant level 
and each Marine Safety Office (MSO) will be able to disseminate them to 
vessel and facility owners or operators, or their designees, by various 
means. Communication of MARSEC Levels will be done in the most 
expeditious means available, given the characteristics of the port and 
its operations. These means will be outlined in the AMS Plan and 
exercised to ensure vessel and facility owners and operators, or their 
designees, are able to quickly communicate with us and vice-versa. 
Because MARSEC Directives will not be as expeditiously communicated as 
other COTP Orders and are not meant to communicate changes in MARSEC 
Levels, we have amended Sec.  101.300 to remove the reference to MARSEC 
Directives. We have added a reference to electronic means.
    One commenter suggested that major commodity groups, including the 
chemical, hazardous material, utility, rail, truck, and air 
transportation industries receive information regarding potential 
threats from the local COTP.
    As stated in Sec.  101.300(b), the COTP will, when appropriate, 
communicate to port stakeholders certain information regarding known 
threats that may cause a transportation security incident.
    We received 15 comments on the facility owner's or operator's 
responsibility to communicate changes in MARSEC Levels to vessels bound 
for the facility. Nine commenters noted that it would be difficult and 
impractical for facilities to notify vessels 96 hours prior to arrival 
of changes in MARSEC Levels, because some vessels and facilities do not 
have a means to provide secure communications. Three commenters stated 
that facilities should not be responsible for notifying vessels that 
have not arrived at the facility of MARSEC Level changes. In contrast, 
one commenter suggested that the Coast Guard amend Sec.  101.300(a) to 
include a provision for facilities to notify vessels of MARSEC Level 
changes within 96 hours, much like that which is currently found in 
Sec.  105.230(b)(1).
    The intent of the regulations is to give vessel owners or operators 
the maximum amount of time possible to ensure the higher MARSEC Level 
is implemented on the vessel prior to interfacing with a facility. This 
ensures that the facility's security at the higher MARSEC Level is not 
compromised when the vessel arrives. Therefore, while it may be 
difficult to contact a vessel in advance of its arrival, it is 
imperative for the security of the facility and the vessel. 
Additionally, communications between the facility and the vessel do not 
need to be secure, as MARSEC Levels are not classified information. We 
have not amended Sec.  101.300(a) because this section is intended to 
regulate communication at the port level, whereas Sec.  105.230(b)(1) 
is intended to regulate communication at the individual facilities 
within the port.
    One commenter asked whether the COTP's communication of required 
actions to minimize risk, under Sec.  101.300(b)(5), refers only to 
measures that have been detailed in the Vessel Security Plan or the 
Facility Security Plan.
    At any MARSEC Level, the COTP, consistent with the authority in 33 
U.S.C. chapter 1221 and 50 U.S.C. chapter 191, may require owners and 
operators to take measures to counter security threats that are beyond 
those detailed in their security plans when necessary to prevent injury 
or damage or to secure the rights and obligations of the U.S. This is 
consistent with requirements specified in the ISPS Code.
    We received 19 comments on the requirements that owners and 
operators of vessels and facilities confirm attainment of increased 
MARSEC Level security measures. Some requested that the Master, not the 
owner or operator, be responsible for reporting to the local COTP the 
attainment of the change in MARSEC Level. Several commenters sought 
clarification as to which COTP they need to report their attainment of 
security measures. Others questioned the ability of the COTP to receive 
potentially hundreds of calls confirming attainment of security 
measures in their security plan or requirements imposed by the COTP. 
Finally, some questioned the benefit of reporting compliance with the 
MARSEC Level change.
    We agree with the comment to allow owners and operators to 
designate the Master or another appropriate person to be responsible 
for reporting the attainment of the MARSEC Level and are amending Sec.  
101.300 to allow this. Our intent is to have one company representative 
contact the local COTP to minimize the number of calls to the local 
COTP during a change in MARSEC Level. Consistent with the ISPS Code, 
part A, attainment measures should be reported to the COTP that issued 
the notice of the change in MARSEC Levels to that vessel, so as to 
ensure compliance.
    Two commenters suggested that the Coast Guard should be responsible 
for facilitating communications between vessels and facilities.
    We believe that it is the Coast Guard's role to ensure that vessels 
and facilities have the proper procedures and equipment for 
communicating with each other. The Coast Guard does have communication 
responsibilities, as found in Sec.  101.300. It is imperative, however, 
that vessels and facilities effectively communicate with each other to 
effectively coordinate the implementation of security measures. Thus, 
we have placed this requirement on the owner or operator, not the Coast 
Guard. The Coast Guard will be inspecting facilities and vessels to 
ensure this communication is accomplished.
    Twelve commenters requested that the Coast Guard issue specific 
communications guidelines to affected facilities and vessels bound for 
and operating in U.S. ports. One commenter stated that, in guidance, we 
should define a means by which changes in MARSEC Levels will be 
communicated to U.S. flag vessels that are not in the coastal waters.
    We recognize that further guidance should be provided to ensure 
communication expectations are clearly outlined. We intend to update 
the guidance in NVIC 9-02 (Guidelines for Port Security Committees, and 
Port Security Plans Required for U.S. Ports) to address communications 
with facilities and vessels bound for and operating in U.S. ports. We 
will also address communication of MARSEC Levels with U.S. flag vessels 
operating internationally in this guidance and intend to coordinate 
these types of communications with MARAD.
    Two commenters suggested web-based information sharing methods. One 
commenter recommended a proprietary, secure, web-based information 
portal for vessels, port facilities, and other transportation/supply 
chain participants to report and record required security information, 
security documents, and security checks in complying with Coast

[[Page 60458]]

Guard and IMO requirements. One commenter suggested that the Coast 
Guard include information to coordinate and provide access to 
regulatory compliance tools on a website. The commenter also suggested 
that the preamble accompanying the final rules should have well-named 
headings to assist the regulated community in locating information, 
including language explaining the applicability of SOLAS and including 
a list of contracting governments.
    We intend to be flexible in the implementation of communication 
reporting methods to be used by vessel and facility owners or 
operators, and we are working on a website to provide security 
information to the regulated community. We encourage owners or 
operators to implement a system that best allows them to meet the 
reporting and recordkeeping requirements of their approved security 
plan. Additionally, the Coast Guard has provided headings throughout 
this preamble, based on the subparts of these security rules, to assist 
the public in locating information. SOLAS applicability is clearly 
defined in SOLAS and IMO maintains a list of contracting governments, 
which can be found on IMO's website (http://www.imo.org).
    Twenty commenters made suggestions regarding reporting to the 
National Response Center (NRC) under Sec.  101.305. Five commenters did 
not support notification to the NRC for all breaches of security. Two 
commenters stated that because the scope of the term ``transportation 
security incident'' and the meaning of the terms ``may result'' and 
``breach of security'' are not clear, the regulated community is at 
risk of both over-reporting and under-reporting suspicious activity. 
Three commenters also suggested that the Coast Guard make a distinction 
between suspicious activities and an actual transportation security 
incident. Four commenters stated that it is not clear what the NRC 
would do with the information about suspicious incidents or how such a 
notification would sufficiently improve facility security in concert 
with other reporting processes for suspicious activity or security 
incidents. Eight commenters suggested that notifying the NRC ``without 
delay'' will not provide for the quickest response and suggested that 
owners or operators be allowed to: (1) Activate the security plan; (2) 
notify local law enforcement; (3) notify the local COTP; (4) use VHF 
channel 16 to notify the local area; or (5) notify the NRC ``as soon as 
practical.''
    The Coast Guard provided a distinction between suspicious 
activities and a transportation security incident in part 101. A 
``transportation security incident'' is defined in Sec.  101.105, as 
``a security incident resulting in a significant loss of life, 
environmental damage, transportation system disruption, or economic 
disruption in a particular area.'' As stated in Sec.  101.305(a), a 
``suspicious activity'' is an activity that may result in a 
transportation security incident. The purpose of requiring vessel and 
facility owners or operators to report suspicious activities or 
breaches of security ``without delay'' to the NRC is to enable the 
Coast Guard to identify patterns of this type of activity on a national 
scale and consult with other Federal agencies to confirm if the 
activity is a coordinated threat to our nation. The NRC will also relay 
to the COTP, and as appropriate port stakeholders, vessels, and 
facilities, reports of suspicious activities, breaches of security, and 
information concerning security-related patterns and trends. Because it 
is imperative to identify nationwide threat patterns, we did not amend 
the reporting requirements for suspicious activities or breaches of 
security. In the case of a transportation security incident, the 
notification goes, without delay, to the COTP or cognizant District 
Commander for OCS facilities, because of the need to assess impacts to 
the port area and to implement the AMS Plan, as appropriate.

Subpart D--Control Measures for Security

    This subpart concerns control and compliance measures, including 
enforcement, MARSEC Directives, and penalties.
    Seventeen commenters urged the Coast Guard to fully recognize the 
need for consistency in the application and enforcement of security-
related regulations and in the plan approval process across several 
COTP zones.
    We do recognize the need for consistency in the application and 
enforcement of the regulations. Therefore, the Coast Guard will 
continue to develop guidance for COTPs to consistently implement and 
enforce the security regulations.
    Two commenters stated that the ``entire issue of the authority to 
issue a MARSEC Directive'' needed clarification. In addition, the 
commenters noted that in Sec.  101.405(a)(1), the Commandant may 
delegate the authority to issue MARSEC Directives and indicated that 
this authority should remain with the Commandant.
    MARSEC Directives are necessary as a mechanism to provide specific 
instruction to achieve the performance standards required by these 
regulations and 46 U.S.C. Chapter 701 but that should not be open to 
the general public. As such, the MARSEC Directives will be labeled as 
sensitive security information because they will contain information 
that, if disclosed, could be used to exploit security systems and 
measures. MARSEC Directives will be issued under an extension of the 
Coast Guard's existing COTP authorities regarding maritime security, 
found in 33 U.S.C. 1226 and 50 U.S.C. 191. In part, the implementing 
regulations for 50 U.S.C. 191, found at 33 CFR 6.14-1 and promulgated 
by Executive Order 10277, contemplate action by the Commandant that is 
national in scope. Specifically, these regulations authorize the 
Commandant to prescribe such conditions and restrictions deemed 
necessary under existing circumstances for the security of certain 
facilities or public and commercial structures and vessels. 
Additionally, 43 U.S.C. 1333(d) authorizes the Coast Guard to establish 
certain requirements for OCS facilities. Moreover, MARSEC Directives 
are a necessary and integral part of carrying out the Coast Guard's 
authorities in 46 U.S.C. Chapter 701. The Commandant, at this time, 
intends to retain the authority to issue all MARSEC Directives.
    Forty-three commenters requested clarification on issuance and 
receipt of MARSEC Directives. Several suggested that the Coast Guard: 
allow companies to submit a national ``security sensitive information 
form,'' rather than notifying each COTP that companies have a ``need to 
know'' the security sensitive information contained in MARSEC 
Directives; have MSOs make Directives from all other MSOs available, 
which will allow them to have ``1-stop shop'' service; and, develop a 
secure website where individuals with sensitive security information 
authorization could access directives from all COTP zones. Many stated 
that owners and operators should not be required to comply with MARSEC 
Directives if they cannot or are not allowed to access the information 
in the Directive when that information is sensitive security 
information. Some were concerned that owners and operators would not 
know if they had a ``need to know'' the information in a MARSEC 
Directive under Sec.  101.405(a)(2). Several comments asked for 
clarification of who will be granted access to applicable MARSEC 
Directives. One commenter requested a standardized process for applying 
for ``need to know'' status. One commenter argued that proof of a 
``need to know'' undermines the purpose of

[[Page 60459]]

communicating MARSEC Directives. One commenter said there should be one 
U.S. agency responsible for disseminating non-classified security 
information to shippers who do not have security clearances. Some 
commenters asked if vessel agents would be able to obtain copies of a 
MARSEC Directive on behalf of the vessel owner or operator. Most stated 
that the current process for communicating MARSEC Directives is 
cumbersome and suggested the best practice to inform foreign vessels 
entering waters under the jurisdiction of the U.S. would be to notify 
each at the time they file their 96-hour Notice of Arrival.
    We recognize that the MARSEC Directive provision in Sec.  101.405 
establishes a challenging process for distributing directives to the 
regulated community. To ensure nationwide consistency, MARSEC 
Directives are issued at the Commandant level and, therefore, will 
allow each MSO to serve as a ``1-stop shop'' for MARSEC Directives. 
When owners, operators, or appointed agents of an owner or operator are 
notified of a MARSEC Directive, information will be included indicating 
those that have a ``need to know.'' To verify that an owner or operator 
has the ``need to know'' the content of a MARSEC Directive, MSOs have 
several tools available to them, including a database of vessels and 
facilities and their owner and operator information. In addition, an 
MSO can determine if a Company Security Officer, Vessel Security 
Officer, or Facility Security Officer has a ``need to know'' if an 
approved Vessel Security Plan or Facility Security Plan is presented to 
them. Once a person has provided enough information for the MSO to 
verify that person's ``need to know'' and status as a regulated entity, 
the MSO will provide the MARSEC Directive. The ``need to know'' 
designation is required to protect sensitive security information from 
being exploited. We also recognize that further guidance should be 
provided to ensure communication expectations are clearly outlined and 
intend to update the guidance in NVIC 9-02 (Guidelines for Port 
Security Committees, and Port Security Plans Required for U.S. Ports) 
to address distribution of MARSEC Directives.
    One commenter asserted that there needs to be a means for industry 
and stakeholders to provide input or feedback both before and after the 
MARSEC Directive becomes effective, considering their knowledge of what 
will or will not work in an effective shipboard security program.
    The regulations, in Sec.  101.405, currently limit the authority to 
issue MARSEC Directives to the Commandant or his/her designee; however, 
we intend to consult other Federal agencies having an interest in the 
subject matter prior to issuing MARSEC Directives. When appropriate and 
as time permits, we intend to further consult with the affected 
industry. Section 101.405(d) also provides for an owner or operator to 
propose equivalent security measures in the event that they are unable 
to comply with MARSEC Directives.
    Two commenters anticipated that MARSEC Directives would be 
prescriptive and that the Coast Guard should grant alternatives and 
equivalencies under these Directives. One commenter asked whether a 
recipient of a MARSEC Directive can maintain equivalent security 
measures for the duration of the directive, which could be open-ended, 
or if the recipient would have a certain amount of time to specifically 
comply with the MARSEC Directive.
    We agree that there should be opportunities for owners and 
operators to implement alternatives or equivalent security measures to 
those prescribed in a MARSEC Directive. We provided these opportunities 
in Sec.  101.405, which governs Sec.  104.145 (MARSEC Directives), to 
allow equivalent security measures to be submitted to the Coast Guard 
in lieu of the specific measures required in a MARSEC Directive. 
Equivalencies approved by the Coast Guard under a specific MARSEC 
Directive will be in effect for the duration of that Directive.
    Two commenters stated that our regulations suggest that information 
designated as sensitive security information is exempt from the Freedom 
of Information Act (FOIA). One commenter suggested that all 
documentation submitted under this rule be done pursuant to the 
Homeland Security Act of 2002, to afford a more legally definite 
protection against disclosure.
    ``Sensitive security information'' is a designation mandated by 
regulations promulgated by TSA and may be found in 49 CFR part 1520. 
These regulations state that information designated as sensitive 
security information may not be shared with the general public. FOIA 
exempts from its mandatory release provisions those items that other 
laws forbid from public release. Thus, security assessments, security 
assessment reports, and security plans, which should be designated as 
sensitive security information, are all exempt from release under FOIA.
    Three commenters stated that Sec.  101.405(a)(2) refers to a 
``covered person'' as a term defined in 49 CFR 1520 related to 
sensitive security information. However, upon review of those 
regulations, they did not find a definition of ``covered person'' in 
those regulations.
    We agree that the terminology in Sec.  101.405(a)(2) is confusing. 
Therefore, we are clarifying Sec.  101.405(a)(2) by amending the phrase 
``require owners or operators to prove that they have a `need to know' 
the information in the MARSEC Directive and that they are a `covered 
person' '' to read ``require the owner or operator to prove that they 
are a person required by 49 CFR 1520.5(a) to restrict disclosure of and 
access to sensitive security information, and that under 49 CFR 
1520.5(b), they have a need to know sensitive security information.''
    One commenter suggested that we amend Sec.  101.405 and change the 
words ``may'' and ``should'' to read ``will'' and ``shall.''
    We do not believe the recommended editorial changes add significant 
value or clarity.
    We received three comments on Recognized Security Organizations 
(RSO). One commenter believed that any question of ``underperformance'' 
on the part of an RSO should be taken up with the flag state that has 
made the designation and should not, in the first instance, be 
sufficient justification for the application of control measures on a 
vessel that has been certified by the RSO in question. Another 
commenter recommended that the Coast Guard maximize national 
consistency and transparency with regard to the factors that are 
evaluated in the targeting matrix. One commenter supported the Coast 
Guard's plan to use Port State Control to ensure that Vessel Security 
Assessments, Plans, and International Ship Security Certificates 
(ISSCs) approved by designated RSOs comply with the requirements of 
SOLAS and the ISPS Code.
    In conducting Port State Control, the Coast Guard will consider the 
``underperformance'' of an RSO. However, a vessel's or foreign port 
facility's history of compliance will also be important factors in 
determining what actions are deemed appropriate by the Coast Guard to 
ensure that maritime security is preserved.
    Two commenters stated that in its control and compliance measures, 
the Coast Guard should clarify its legal authority to establish a 
security zone beyond its territorial sea.
    One basis for the Coast Guard to establish security zones in the 
EEZ is pursuant to the Ports and Waterways Safety Act, 33 U.S.C. 1221 
et seq. For

[[Page 60460]]

example, consistent with customary international law, 33 U.S.C. 1226 
provides the Coast Guard with authority to carry out or require 
measures, including the establishment of safety and security zones, to 
prevent or respond to an act of terrorism against a vessel or public or 
commercial structure that is located within the marine environment. 33 
U.S.C. 1222 defines ``marine environment'' broadly to include the 
waters and fishery resources of any area over which the U.S. asserts 
exclusive fishery management authority. The U.S. asserts exclusive 
fishery management authority in the EEZ.
    Ten commenters were concerned that the control and compliance 
measures section did not address the liability implications of 
implementing the provisions required by these regulations and complying 
with the directives associated with the MARSEC Levels established by 
the Coast Guard. Two commenters were concerned with the liability for 
oil spills resulting from a transportation security incident. Two 
commenters recommended that the strict liability scheme under OPA 90 
not be used for such circumstances. Two commenters believed there is a 
need to address liability for undue delay during application of control 
measures. One commenter believed there is a need to address Coast Guard 
liability in the context of owners or operators acting as government 
agents when conducting screenings. One commenter questioned whether the 
ship agent, whose bond is often used for Customs clearance for a 
vessel, would be liable if a vessel violates control and compliance 
issues.
    An approved security plan under these security regulations 
satisfies the requirements of 46 U.S.C 70103(c)(3)(D). The fact that a 
transportation security incident is not deterred does not alone 
constitute a failure to comply with these security regulations. Failure 
to follow the approved plan, however, is a violation of these 
regulations. While we appreciate the points raised concerning potential 
liability for terrorist acts and when owners or operators are 
conducting screenings, the issue of liability is beyond the scope of 
this final rule. No provision of the MTSA addressed liability, either 
to expressly limit liability or to address immunity from liability. 
Additionally, the MTSA did not address liability within the context of 
undue delay. Among other things, determinations of liability require a 
fact-laden inquiry on a case-by-case basis and typically require 
complex analyses regarding matters such as choice of law, contracts, 
and international conventions. Undue delay is a term used in 
international conventions and likewise requires fact-laden analysis 
that we leave for the courts. We note that OPA 90 provides three 
defenses to its liability regime (act of God, act of war, or act or 
omission of a third party, as set forth 33 U.S.C. 2703). Whether one of 
these defenses will apply to a transportation security incident will 
depend on the facts of each case. Concerning the comment regarding 
compensation for undue delay of vessels, we note that this is a 
principle commonly found in IMO instruments, including other parts of 
SOLAS and the International Convention for the Prevention of Pollution 
from Ships, 1973, as modified by the Protocol of 1978 relating thereto 
(MARPOL 73/78). Therefore, we anticipate that claims for undue delay 
under SOLAS Chapter XI-2, regulation 9, will be resolved similar to the 
resolution found in these other instruments.
    One commenter said that penalties should be applied equally to both 
U.S. flag vessels and foreign flag vessels.
    We believe that the commenter misunderstood the nature of 
authorities granted to port and flag states. The assertion that 
penalties are applied unequally to U.S. and foreign flag vessels is 
incorrect. Civil penalties authorized by 46 U.S.C. 70117 apply equally 
to both U.S. and foreign vessels that do not meet the requirements of 
the regulations. Because we can revoke, at any point, ISSCs for Vessel 
Security Plans that we approve, we have full discretion in enforcing 
the rules on those vessels. For foreign flag vessels whose ISSCs are 
issued by its flag administration, we can enforce the regulations by 
not allowing the vessel to call at our ports, or we can work with the 
country issuing the vessel's ISSC to revoke it. We will enforce the 
regulations equally; however, the comment brought to light the need to 
clarify Sec.  101.410(b)(8) to include the right of the U.S. to revoke 
any security plan we approve, and we have amended the section to 
clarify this requirement.
    After reviewing Sec.  101.420, we amended paragraph (b) to clarify 
that appeals of certain decisions and actions of the District Commander 
should be made to the Commandant (G-MOC).

Subpart E--Other Provisions

    This subpart concerns Declarations of Security, security assessment 
tools, and credentials for personal identification.
    Three commenters stated that the Coast Guard should delegate its 
authority for reviewing and approving security plans to an RSO, stating 
that if the Coast Guard reviews and approves all plans, this will 
interfere with other critical Coast Guard missions.
    We believe that it is imperative to maritime homeland security to 
ensure consistent application of the requirements of parts 101 through 
106 and will conduct the reviews and approvals of certain security 
plans. We do not intend to delegate authority to an RSO at this time. 
Reconsideration and further delegation of plan approvals may be 
provided once a stable nationwide foundation for maritime security has 
been established. Although the Coast Guard is not delegating plan 
approval authority, we have ensured plan review resources will be 
sufficient for implementing these regulations while not negatively 
affecting Coast Guard missions.
    Three commenters asked when the Coast Guard would communicate 
standards for U.S. flag vessels and facilities as to the timing and 
format of a Declaration of Security. One commenter requested 
information about how Declaration of Security requirements will be 
communicated to and coordinated with vessels that do not regularly call 
U.S. ports and specific facilities.
    As specified in Sec.  101.505, the format of a Declaration of 
Security is described in SOLAS Chapter XI-2, Regulation 10, and the 
ISPS Code. The timing requirements for the Declaration of Security are 
specified in Sec. Sec.  104.255 and 105.245. The format for a 
Declaration of Security can be found as an appendix to the ISPS Code. 
We agree that the format requirement was not clearly included in Sec.  
101.505(a) when we called out the incorporation by reference. 
Therefore, we have explicitly included a reference to the format in 
Sec.  101.505(b).
    One commenter asked whether the Declaration of Security requirement 
applies to vessel-to-vessel or vessel-to-facility interfaces beyond the 
12-mile limit but still in the U.S. EEZ.
    Vessel-to-vessel activity in the EEZ is not included in these 
regulations, except if one of the vessels is intending to enter a U.S. 
port. The regulations do apply to vessels interfacing with OCS 
facilities.
    We received 15 comments regarding security assessment tools. Eleven 
commenters would like the Coast Guard to formally approve a separate 
security assessment methodology as one that may be used by a refiner or 
petrochemical manufacturer, and also to incorporate it by reference. 
The commenters believe that it is a sophisticated and effective 
methodology for conducting Facility Security Assessments. One commenter 
asked whether an owner or operator who has

[[Page 60461]]

already completed a risk assessment using a risk assessment tool other 
than those listed in Sec.  101.510 must conduct a new assessment using 
one of those tools. Three commenters asked that the Coast Guard provide 
a list of security assessment tools that would satisfy all DHS and 
Coast Guard requirements.
    The Coast Guard does not intend to approve security assessment 
tools or incorporate such tools by reference because we prefer to allow 
flexibility for industry to develop their own tools to meet their 
specific needs. We have provided a list of examples of security 
assessment tools in Sec.  101.510; however, this list is not 
exhaustive. We do not require owners or operators to conduct security 
assessments using these tools as long as the assessments meet the 
requirements of these regulations. To clarify that the list in Sec.  
101.510 represents some, but not all, assessment tools available for 
facilitating security assessments, we have amended it to include the 
word ``may.''
    It should be noted that the list in Sec.  101.510 includes a no-
cost, user-friendly, web-based, vulnerability-self-assessment tool 
designed by TSA. This tool was developed by TSA in coordination with 
other Federal agencies and members of academia and industry as a means 
to assist vessel and facility owners and operators in completing the 
security assessments mandated by these maritime security regulations. 
Any information entered into the tool will not be accessible by TSA or 
any other Federal agencies unless the owner or operator formally 
submits this information to TSA. TSA, in coordination with the Coast 
Guard, is developing guidance that will assist users of the TSA tool. 
At this time, TSA does not intend to publish a Notice of Proposed 
Rulemaking requiring the use of this tool.
    One commenter asked for clarification of the terms ``self 
assessments,'' ``security assessments,'' ``risk/threat assessments,'' 
and ``on-scene surveys.''
    Risk/threat assessments and self assessments are not specifically 
defined in the regulations, but refer to the general practices of 
assessing where a vessel or facility is at risk. The assessments 
required in parts 104 through 106 must take into account threats, 
consequences, and vulnerabilities; therefore, they are most 
appropriately titled ``security assessments.'' This title also aligns 
with the ISPS Code. To clarify that Sec. Sec.  101.510 and 105.205 
address security assessments required by subchapter H, we have amended 
these sections to change the term ``risk'' to the more accurate term 
``security.'' ``On-scene surveys'' are explained in the security 
assessment requirements of parts 104, 105, and 106. As explained in 
Sec.  104.305(b), for example, the purpose of an on-scene survey is to 
``verify or collect information'' required to compile background 
information and ``consists of an actual survey that examines and 
evaluates existing vessel protective measures, procedures, and 
operations.'' An on-scene survey is part of a security assessment.
    One commenter stated that the temporary interim rule requirement to 
institute a photo identification card system for crewmembers is 
unreasonable because it will cost over $2,000 and will be obsolete when 
the Transportation Worker Identification Credential (TWIC) requirement 
is enacted. One commenter stated that some ports are already 
establishing credentialing programs of varying complexity and scope and 
emphasized the need for the national TWIC program to be implemented as 
soon as possible.
    The temporary interim rule does not require vessel or facility 
owners or operators to have a photo identification card system that is 
vessel or facility specific. The personal identification requirements 
of Sec.  101.515 are well within the scope of the majority of current 
identification systems such as driver's licenses and union cards. 
Vessel and facility owners or operators can use any personal 
identification that meets the requirements of Sec.  101.515; they do 
not have to develop their own card systems. Section 101.515 was meant 
to provide a temporary solution to the criteria for personal 
identification to facilitate access control until the TWIC criteria 
could be implemented. TSA is working closely with other agencies of DHS 
(e.g., the Coast Guard), agencies of DOT (e.g., MARAD), and other 
government agencies to develop the TWIC and its use to ensure that it 
can be a practical personal identification system for the 
transportation community.
    Two commenters stated that our regulations will require employers 
to reissue identification cards when individuals grow beards or 
mustaches because the photo will not ``accurately depict the 
individual's current facial appearance.''
    Facial hair may not necessarily alter the depiction of an 
individual on picture identification so much that the individual is no 
longer identifiable. If the individual depicted on the identification 
has changed his or her appearance to the extent that the individual is 
no longer accurately depicted, then a new identification card would be 
required.
    One commenter suggested that commuter ticket books or badges could 
serve as a form of required identification for passengers on board 
ferries.
    Personal identification remains a requirement in these regulations, 
as described in Sec.  101.515, to ensure, if needed, the identification 
of any passenger. A ticket book or badge that meets the requirements of 
Sec.  101.515 could serve as personal identification. To ease 
congestion for ferry passengers, we have included alternatives to 
checking personal identification as described in Sec.  104.292. These 
alternatives, if used, can expedite access to the ferry while 
maintaining adequate security.
    After further review, and based on comments from several other 
agencies and Coast Guard field units, we have amended Sec.  101.515 by 
adding a new provision to clarify that the identification and access 
control requirements of this subchapter must not be used to delay or 
obstruct authorized law enforcement officials from being granted access 
to the vessel, facility, or OCS facility. Authorized law enforcement 
officials are those individuals who have the legal authority to go on 
the vessel, facility, or OCS facility for purposes of enforcing or 
assisting in enforcing any applicable laws. This authority is evident 
by the presentation of identification and credentials that meet the 
requirements of Sec.  101.515, as well as other factors such as the 
uniforms and markings on law enforcement vehicles and vessels. Delaying 
or obstructing access to authorized law enforcement officials by 
requiring independent verification or validation of their 
identification, credential, or purposes for gaining access could 
undermine compliance and inspection efforts, be contrary to enhancing 
security in some instances, and be contrary to law. Failure or refusal 
to permit an authorized law enforcement official presenting proper 
identification to enter or board a vessel, facility, or OCS facility 
will subject the operator or owner of the vessel, facility, or OCS 
facility to the penalties provided in law. In addition, an owner or 
operator of a vessel (including the Master), facility, or OCS facility 
that reasonably suspects individuals of using false law enforcement 
identification or impersonating a law enforcement official to gain 
unauthorized access, should report such concerns immediately to the 
COTP.
    Two commenters stated concerns regarding standards for seafarers' 
identification cards and other identifying documents. One commenter 
stated that the Coast Guard must ensure

[[Page 60462]]

that foreign and U.S. requirements for seafarers' identification are 
consistent. The commenter also stated that the Coast Guard must ensure 
consistency among U.S. facilities. One commenter urged the Coast Guard 
to provide a comprehensive and clear explanation of whether the U.S. 
will be using the new ILO seafarers' identity documents.
    We appreciate the commenters' concern regarding standards for 
seafarers' identification cards and the intentions of the U.S. with 
regard to international seafarers' identity documents, but these 
comments are beyond the scope of these rules. We have provided minimum 
requirements for determining whether an identification credential may 
be accepted in Sec.  101.515. We also discussed, in detail, our 
intentions regarding seafarers' identification criteria in the preamble 
to the ``Implementation of National Maritime Security Initiatives'' 
temporary interim rule (68 FR 39264).
    One commenter supported making foreign-flag shipowners, operators, 
and ship managers responsible for establishing a vetting program of 
their newly hired officers and crew, requiring background checks of 
their seafarers, and having the Coast Guard audit those firms to ensure 
the vetting is done. The commenter stated that having a system for 
vetting would eliminate a ``loophole'' that could result in loss of 
American lives and property.
    We will continue a vigorous Port State Control program that will 
now include verifying compliance with SOLAS and the ISPS Code for 
foreign-flag SOLAS vessels. We have been working aggressively, both 
internationally and nationally, to develop seafarer's identification 
requirements that include the vetting of newly hired officers and crew 
and that also address background check requirements. Since the 
implementation of the International Safety Management Code (ISM Code), 
audits and other quality verifications are now standard in the 
international maritime community. Therefore, once a seafarer's 
identification requirement is established, we expect it will be audited 
under the ISM Code, and foreign flag vessels will not require specific 
Coast Guard oversight.
    One commenter stated that part 102 provisions in the temporary 
interim rule should make the seafarers' identification documents that 
comply with ILO-185 acceptable as a substitute for or waiver of a visa 
for shore leave.
    Part 102 has been reserved for the National Maritime Transportation 
Security Plan, not seafarers' identification. Section 101.515 addresses 
identification. The requirements in Sec.  101.515 are not waivers for a 
visa. Visas are a matter of immigration law and are beyond the scope of 
these final rules.

Part 102--National Maritime Transportation Security

    This part is reserved and concerns the development of the 
overarching National Maritime Transportation Security Plan for 
sustaining National Maritime Security initiatives.

Procedural

    Fourteen commenters addressed the public comment period. One 
commenter stated that another comment period will be necessary once 
plans are approved. Six commenters said the 30-day comment period was 
inadequate and should be lengthened. Five commenters requested a longer 
comment period specifically for the AIS temporary interim rule.
    We did not extend the comment period due to the need to follow the 
MTSA's statutory deadline for issuance of regulations. We acknowledge 
that these regulations are being implemented in a short period of time. 
In this final rule, we require security measures, assessments, and 
plans for those vessels and facilities we have determined may be 
involved in a transportation security incident. It is not clear how 
further comments will benefit security after plan submission is 
complete. We continually review guidance we issue to implement 
regulations and welcome feedback on guidance we have developed for 
these regulations. Regarding AIS specifically, we will be reopening the 
comment period on our previously published notice titled ``Automatic 
Identification System; Expansion of Carriage Requirements for U.S. 
Waters'' (USCG 2003-14878; July 1, 2003; 68 FR 39369).
    Three commenters addressed the public meeting held on July 23, 
2003. One commenter asked the Coast Guard to hold an additional public 
meeting in the Houston, Texas, area and proposed several dates in July 
2003. Two commenters stated that many came to the public meeting 
believing that it would be not just a listening session, but also an 
opportunity to discuss and clarify the proposed regulations, in 
preparation for submitting written comments before the end of the 
comment period.
    We acknowledge that these regulations are being implemented in a 
short period of time. Due to the time constraints of the MTSA, however, 
we held only one public meeting on July 23, 2003. Previous public 
meetings in January 2002 and in January and February 2003 provided the 
public several opportunities to discuss various maritime security 
issues with Coast Guard representatives. Because the opportunity to 
hear public comments is so important, we set an agenda for the July 
2003 meeting that allowed us to hear public comments rather than to 
debate the issues further. Additionally, the preambles to the temporary 
interim rules clearly stated our position on maritime security, which 
did not need further elucidation in a public setting at the expense of 
receiving stakeholders' comments.

Additional Changes

    After further review of this part, we made several non-substantive 
editorial changes, such as adding plurals and fixing noun, verb, and 
subject agreements. In addition, the part heading in this part has been 
amended to align it with all the part headings within this subchapter.

Incorporation by Reference

    The Director of the Federal Register has approved the material in 
Sec.  101.115 for incorporation by reference under 5 U.S.C. 552 and 1 
CFR part 51. Copies of the material are available from the sources 
listed in Sec.  101.115.
    This final rule incorporates by reference SOLAS Chapters XI-1 and 
XI-2 and the ISPS Code. Specifically, we are incorporating the 
amendments adopted on December 12, 2002, to the Annex to SOLAS and the 
ISPS Code, also adopted on December 12, 2002. The material is 
incorporated for all of subchapter H. The final rule titled ``Automatic 
Identification System; Vessel Carriage Requirement'' (USCG-2003-24757), 
found elsewhere in today's Federal Register, has its own incorporation 
by reference section in 33 CFR 164.03.

Regulatory Assessment

    This final rule is a ``significant regulatory action'' under 
section 3(f) of Executive Order 12866, Regulatory Planning and Review. 
The Office of Management and Budget has reviewed it under that Order. 
It requires an assessment of potential costs and benefits under section 
6(a)(3) of that Order. It is significant under the regulatory policies 
and procedures of the Department of Homeland Security. A summary of 
comments on the assessments, our responses, and a summary of the 
assessments follow.
    We received 11 comments relating to the cost of implementing these 
regulations. Nine commenters asked if DHS plans to offer annual grants 
to

[[Page 60463]]

assist in covering the costs incurred by the operators to satisfy the 
requirements of the rules. Two commenters stated that compliance with 
all security requirements should be extended to 2008, or until 
sufficient monies are allocated by the Congress to cover cost. One 
commenter stated that the regulations should grant enough flexibility 
to COTPs to consider a facility's limited resources and cost-
effectiveness ratio of implementation when they review the security 
plan for approval. Three commenters asked how these rules recognize and 
assist very small ports and small businesses.
    We appreciate that the cost of implementing these regulations could 
have significant impacts on annual revenues for some vessel or facility 
owners and operators. Pursuant to Section 102 of the MTSA, DOT is 
required to develop a grant program. DHS is working with DOT on the 
grant program. At this point, we do not know if Congress will 
appropriate funds to continue this program and allow for grants on a 
continuing annual basis. We cannot alter the compliance dates of these 
regulations because they are mandated by the MTSA and aligned to meet 
the entry into force date of SOLAS Chapter XI and the ISPS Code. We 
recognize the difficulty small facilities may have in meeting our 
security requirements and, therefore, we have developed flexible 
measures and performance-based standards to allow owners or operators 
to implement cost-effective security measures. We have made the 
requirements as flexible as possible and have analyzed the risk to 
ensure that applicability is focused on those vessels and facilities 
that may be involved in a transportation security incident.
    Two commenters addressed the burdens involved in moving from MARSEC 
Level 1 to MARSEC Level 2. One commenter strongly urged the Coast Guard 
to be cautious whenever contemplating raising the MARSEC Level because 
the commenter claimed that we estimated the cost to the maritime 
industry of increasing the MARSEC Level from 1 to 2 will be $31 million 
per day. The other commenter expressed doubt that a facility's security 
would be substantially increased by hiring local security personnel 
``as required'' at MARSEC Level 2.
    We agree that each MARSEC Level elevation may have serious economic 
impacts on the maritime industry. We make MARSEC Level changes in 
conjunction with DHS to ensure the maritime sector has deterrent 
measures in place commensurate with the nature of the threat to it and 
our nation. The financial burden to the maritime sector is one of many 
factors that we consider when balancing security measure requirements 
with economic impacts. Furthermore, we disagree with the first 
commenter's statement of our cost assessment to the maritime industry 
for an increase in MARSEC Level 1 to MARSEC Level 2. In the Cost 
Assessment and Initial Regulatory Flexibility Act analyses for the 
temporary interim rules, we estimated that the daily cost of elevating 
the MARSEC Level from 1 to 2 is $16 million. We also disagree with the 
second commenter's inference that hiring local security personnel to 
guard a facility is required at MARSEC Level 2. Section 105.255 lists 
``assigning additional personnel to guard access points'' as one of the 
enhanced security measures that a facility may take at MARSEC Level 2, 
but this can be done by reassigning the facility's own staff rather 
than by hiring local security personnel; however, it is only one of 
several MARSEC Level 2 security enhancements listed in Sec.  
105.255(f), which is not an exclusive list.
    Three commenters stated that security measures required under 
MARSEC Level 3 would pose an unfair economic burden upon an owner or 
operator and could create an ``industry'' for additional security 
measures.
    The security measures required under MARSEC Level 3 are designed to 
address the increased threat of a probable or imminent transportation 
security incident. At this highest level of threat, the maritime 
industry is vulnerable to a transportation security incident and can be 
exposed to significant economic losses. Were a maritime transportation 
security incident to occur, the nation could experience devastating 
losses, including significant loss of life, serious environmental 
damage, and severe economic shocks. While we can reasonably expect 
MARSEC Level 3 to increase the direct costs to businesses attributable 
to increased personnel or modified operations, we believe the indirect 
costs to society of the ``ripple effects'' associated with a 
transportation security incident would greatly outweigh the direct 
costs to the maritime industry. Additionally, we expect this highest 
level of threat to occur infrequently.
    Five commenters stated that our cost estimates understate the cost 
for international ships calling on U.S. ports. Three commenters noted 
that the same parameters used to develop the costs for the U.S. SOLAS 
vessels should be extrapolated and applied to international ships, 
adjusted for the time these ships spend in waters subject to the 
jurisdiction of the U.S. One commenter asked us to explain why only 70 
foreign flag vessels were included in our analysis of the cost of the 
temporary interim rule.
    We disagree with the commenters' assertion that our estimate 
understates the cost for international ships calling on U.S. ports. We 
developed our estimate assuming that foreign flag vessels subject to 
SOLAS would be required by their flag state, as signatories to SOLAS, 
to implement SOLAS and the ISPS Code. The flag administrations of 
foreign flag SOLAS vessels will account, therefore, for the costs of 
complying with SOLAS and the ISPS Code. Our analysis accounts for the 
costs of the final rule to U.S. flag vessels subject to SOLAS. 
Additionally, we estimate costs for the approximately 70 foreign flag 
vessels that are not subject to SOLAS that would not need to comply 
with either SOLAS or the ISPS Code. These vessels must comply with the 
requirements in 33 CFR part 104 if they wish to continue operating in 
U.S. ports after July 1, 2004, and we therefore estimate the costs to 
these vessels.
    One commenter suggested taking into greater account the risk 
factors of the facility and vessel as a whole, rather than simply 
relying on one factor such as the capacity of a vessel as well as the 
cost-benefit of facility security to all of the business entities that 
make up a facility.
    The Coast Guard considered an extensive list of risk factors when 
developing these regulations including, but not limited to, vessel and 
facility type, the nature of the commerce in which the entity is 
engaged, potential trade routes, accessibility of facilities, gross 
tonnage, and passenger capacity. Our Cost Assessments and Regulatory 
Flexibility Act Analyses are available in the dockets for both the 
temporary interim rules and the final rules, and they account for 
companies as whole business entities, not individual vessels or 
facilities.
    One commenter was concerned that the entire list of ships that are 
directly regulated under part 104 have been designated as ``high risk'' 
for a transportation security incident. The commenter noted that no 
account appears to have been taken of the different types of vessels or 
specific threats and warnings.
    We explained in detail in the temporary interim rule (68 FR 39244-
6) (part 101) how we used the National Risk Assessment Tool (N-RAT) to 
determine risks associated with specific

[[Page 60464]]

threat scenarios against various classes of targets within the MTS.
    Two commenters questioned the accuracy of the estimated average 
fatalities from a transportation security incident for a large 
passenger vessel. One commenter reasoned that the ``outstanding'' 
safety record of the industry in recent history does not substantiate 
the estimated average fatalities for an accident and, therefore, puts 
into question our estimated average fatality for a transportation 
security incident. One commenter urged caution in interpreting figures 
between safety and security to determine what is a transportation 
security incident.
    Our initial estimated number of fatalities on large passenger ships 
was based on major maritime accidents over the past century. We noted 
that historically, the worst maritime accidents (e.g., Titanic, 
Lusitania, Empress of Ireland) produced fatality rates over 50 percent. 
However, the commenter is correct in asserting that portions of the 
large passenger vessel industry have experienced a significant period 
of time with few accident-related fatalities which can be attributed, 
in part, to innovations in safety and advances in accident 
survivability. Therefore, since the dataset used to compile the 
estimated number of fatalities per accident lacked recent events, we 
used the lower estimate of 32 percent, which is based on the actual 
fatality rate of accidents involving small passenger vessels. We 
acknowledge that small passenger vessels would likely use different 
safety and survivability measures than large passenger vessels. 
However, we disagree that that using the 32 percent for the estimated 
average accident-related fatality rate for large passenger vessels is 
incorrect--it illustrates a catastrophic failure. The estimated average 
fatality rate for a transportation security incident is higher than for 
a safety-related accident because a transportation security incident is 
perpetrated with the intent to inflict a high casualty rate. Safety 
measures, therefore, will have some, but not an equivalent level of 
effectiveness during a transportation security incident. We believe 
that the average transportation security incident-related fatality 
rate, in general for those directly regulated under subchapter H, and 
in particular for large passenger vessels, will result in a 
``significant loss of life'' and, therefore, be a transportation 
security incident.
    One commenter asked for clarification on whether the N-RAT results 
indicated a lower risk for facilities that do not receive vessels on 
international voyages, even if those voyages are by vessels exceeding 
100 gross tons and transiting international waters. The commenter also 
asked whether Guam and the Northern Marianas Islands are part of the 
U.S. and whether a domestic voyage may cross international waters.
    The N-RAT indicated that vessels on international voyages may be 
involved in a transportation security incident. In Sec.  101.105, the 
term ``territory'' includes the Commonwealth of Puerto Rico, all 
possessions of the U.S., and all lands held by the U.S. under a 
protectorate or mandate. This includes Guam and the Northern Marianas 
Islands. A domestic voyage includes a direct transit between two U.S. 
ports, regardless of whether the vessel transits international waters.
    One commenter asked if there is any public benefit to building 
infrastructure and increasing staffing, stating that the ports have no 
way to pay for such upgrades.
    Using the N-RAT, we determined that significant public benefit 
accrues if a transportation security incident is avoided or the effects 
of the transportation security incident can be reduced. These public 
benefits include human lives saved, pollution avoided, and ``public'' 
infrastructure, such as national landmarks and utilities, protected.
    Three commenters stated that the cost/benefit assessment in the 
temporary interim rule (68 FR 39276) (part 101) is questionable. One 
commenter noted that we did not use the most recent industry data. Two 
commenters stated that cost estimates might be close to accurate but 
that the benefits were based on assumptions that are difficult to 
measure.
    We used the most reliable economic data available to us from the 
U.S. Census Bureau among other government data sources. In the notice 
of public meeting (67 FR 78742, December 20, 2002), we presented a 
preliminary cost assessment and requested comments and data be 
submitted to assist us in drafting our estimates. We amended our cost 
estimates incorporating comments and input we received. While the 
assessment may or may not be useful to the reader, we must develop a 
regulatory assessment for all significant rules, as required by 
Executive Order 12866.

Cost Assessment Summary

    The following summary presents the estimated costs of complying 
with the final rules on Area Maritime Security, Vessel Security, 
Facility Security, OCS Facility Security, and AIS, which are published 
elsewhere in today's Federal Register. Because the changes in this 
final rule do not affect the original cost estimates presented in the 
temporary interim rule (68 FR 39272) (part 101), the costs remain 
unchanged.
    For the purposes of good business practice, or to comply with 
regulations promulgated by other Federal and State agencies, many 
companies already have spent a substantial amount of money and 
resources to upgrade and improve security. The costs shown in this 
summary do not include the security measures that these companies have 
already taken to enhance security.
    We realize that every company engaged in maritime commerce would 
not implement the final rules exactly as presented in this assessment. 
Depending on each company's choices, some companies could spend much 
less than what is estimated herein, while others could spend 
significantly more. In general, we assume that each company would 
implement the final rules based on the type of vessels or facilities it 
owns or operates, whether it engages in international or domestic 
trade, and the ports where it operates.
    This assessment presents the estimated cost if vessels, facilities, 
OCS facilities, and areas are operating at MARSEC Level 1, the current 
level of operations since the events of September 11, 2001. We also 
estimate the costs for operating for a brief period at MARSEC Level 2, 
an elevated level of security. We also discuss the potential effects of 
operating at MARSEC Level 3, the highest level of threat.
    We do not anticipate that implementing the final rules will require 
additional manning aboard vessels or OCS facilities; existing personnel 
can assume the duties envisioned. For facilities, we anticipate 
additional personnel in the form of security guards that can be hired 
through contracting with a private firm specializing in security.
    Based on our assessment, the first-year cost of implementing the 
final rules is approximately $1.5 billion.
    Following initial implementation, the annual cost is approximately 
$884 million, with costs of present value $7.331 billion over the next 
10 years (2003-2012, 7 percent discount rate). Estimated costs are as 
follows.

Vessel Security

    Implementing the final rule will affect about 10,300 U.S. flag 
SOLAS, domestic (non-SOLAS), and foreign non-SOLAS vessels. The first-
year cost of purchasing and installing equipment, hiring security 
officers, and preparing paperwork is approximately $218 million. 
Following initial implementation, the annual cost is approximately $176 
million. Over the

[[Page 60465]]

next 10 years, the cost would be present value $1.368 billion.

Facility Security

    Implementing the final rule will affect about 5,000 facilities. The 
first-year cost of purchasing and installing equipment, hiring security 
officers, and preparing paperwork is an estimated $1.125 billion. 
Following initial implementation, the annual cost is approximately $656 
million. Over the next 10 years, the cost would be present value $5.399 
billion.

OCS Facility Security

    Implementing the final rule will affect about 40 OCS facilities 
under U.S. jurisdiction. The first-year cost of purchasing equipment 
and preparing paperwork is an estimated $3 million. Following initial 
implementation, the annual cost is approximately $5 million. Over the 
next 10 years, the cost would be present value $37 million.

Area Maritime Security

    Implementing the final rule will affect about 47 COTP zones 
containing 361 ports. The initial cost of the startup period (June 
2003-December 2003) is estimated to be $120 million. Following the 
startup period, the first year of implementation (2004) is estimated to 
be $106 million. After the first year of implementation, the annual 
cost is approximately $46 million. Over the next 10 years, the cost 
would be present value $477 million.

Automatic Identification System (AIS)

    Implementing the final rule will affect about 3,500 U.S. flag SOLAS 
vessels, domestic (non-SOLAS) vessels in Vessel Traffic Service (VTS) 
areas, and foreign flag non-SOLAS vessels. The first-year cost of 
purchasing equipment and training for U.S. vessels (SOLAS and domestic) 
is approximately $30 million. Following initial implementation, the 
annual cost is approximately $1 million. Over the next 10 years, the 
cost for these vessels would be present value $50 million (with 
replacement of the units occurring 8 years after installation).

MARSEC Levels 2 and 3

    MARSEC Level 2 is a heightened threat of a security incident, and 
intelligence indicates that terrorists are likely to be active within a 
specific target or class of targets. MARSEC Level 3 is a probable or 
imminent threat of a security incident. MARSEC Levels 2 and 3 costs are 
not included in the above summaries because of the uncertainty that 
arises from the unknown frequency of elevation of the MARSEC Level and 
the unknown duration of the elevation.
    The costs to implement MARSEC Levels 2 and 3 security measures in 
response to these increased threats do not include the costs of 
security measures and resources needed to meet MARSEC Level 1 
(summarized above) and will vary depending on the type of security 
measures required to counter the specific nature of higher levels of 
threat. Such measures could include additional personnel or assigning 
additional responsibilities to current personnel for a limited period 
of time.
    We did not consider capital improvements, such as building a fence, 
to be true MARSEC Levels 2 or 3 costs. The nature of the response to 
MARSEC Levels 2 and 3 is intended to be a quick surge of resources to 
counter an increased threat level. Capital improvements generally take 
time to plan and implement and could not be in place rapidly. Capital 
improvement costs are estimated under MARSEC Level 1 costs.
    We did not calculate MARSEC Level 2 cost for the AMS rule because 
this will be primarily a cost to the Coast Guard for coordinating the 
heightened MARSEC Level in port and maritime areas.
    To estimate a cost for MARSEC Level 2, we made assumptions about 
the length of time the nation's ports can be expected to operate at the 
heightened MARSEC Level. For the purpose of this assessment only, we 
estimate costs to the nation's ports elevating to MARSEC Level 2 twice 
a year, for 3 weeks each time, for a total period of 6 weeks at MARSEC 
Level 2. Again, this estimate of 6 weeks annually at MARSEC Level 2 is 
for the purposes of illustrating the order of magnitude of cost we can 
expect. Our estimate should not be interpreted as the Coast Guard's 
official position on how often the nation's ports will operate at 
MARSEC Level 2.
    We estimated that there are Vessel Security Officers aboard all 
U.S. flag SOLAS vessels and most domestic vessels. We estimated that 
there will also be key crewmembers that can assist with security duties 
during MARSEC Level 2 aboard these vessels. We assumed that both Vessel 
Security Officers and key crewmembers will work 12 hours a day (8 hours 
of regular time, 4 hours of overtime) during the 42 days that the ports 
are at MARSEC Level 2. We then estimated daily and overtime rates for 
Vessel Security Officers and key crewmembers. Given these assumptions, 
we estimated that elevating the security level to MARSEC Level 2 twice 
a year each for 21 days will cost vessel owners and operators 
approximately $235 million annually.
    We estimated that every regulated facility will have a Facility 
Security Officer assigned to it. We also estimated that there will also 
be a key person that can assist with security duties during MARSEC 
Level 2 at each facility. We assumed that both Facility Security 
Officers and key personnel will work 12 hours a day (8 hours of regular 
time, 4 hours of overtime). For facilities that have to acquire 
security personnel for MARSEC Level 1, we assumed that during MARSEC 
Level 2 the number security guards would double for this limited time. 
For the facilities for which we did not assume any additional guards at 
MARSEC Level 1, we assumed that during MARSEC Level 2 these would have 
to acquire a minimal number of security guards. Given these 
assumptions, we estimated that elevating the security level to MARSEC 
Level 2 twice a year each for 21 days will cost facility owners and 
operators approximately $424 million annually.
    We estimated that elevating the security level to MARSEC Level 2 
twice a year each for 21 days will cost the regulated OCS facility 
owners and operators approximately $4 million annually. This cost is 
primarily due to increased cost for OCS Facility Security Officers and 
available key security personnel.
    Other costs that we did not attempt to quantify include possible 
operational restrictions such as limiting cargo operations to daylight 
hours or greatly limiting access to facilities or vessels.
    MARSEC Level 3 will involve significant restriction of maritime 
operations that could result in the temporary closure of individual 
facilities, ports, and waterways either in a region of the U.S. or the 
entire nation. Depending on the nature of the specific threat, this 
highest level of maritime security may have a considerable impact on 
the stakeholders in the affected ports or maritime areas. The ability 
to estimate the costs to business and government for even a short 
period at MARSEC Level 3 is virtually impossible with any level of 
accuracy or analytical confidence due to the infinite range of threats 
and scenarios that could trigger MARSEC Level 3.
    The length and the duration of the increased security level to 
MARSEC Level 3 will be entirely dependent on the intelligence received 
and the scope of transportation security incidents or disasters that 
have already occurred or are imminent. While we can reasonably expect 
MARSEC Level 3 to increase the direct costs to businesses attributable 
to increased personnel or modified operations, we believe the indirect 
costs to society of the ``ripple effects''

[[Page 60466]]

associated with sustained port closures would greatly outweigh the 
direct costs to individual businesses.

The U.S. Marine Transportation System (MTS)

    The cost of MARSEC Level 3 can best be appreciated by the benefits 
of the MTS to the economy. Maritime commerce is the lifeblood of the 
modern U.S. trade-based economy, touching virtually every sector of our 
daily business and personal activities.
    Annually, the MTS contributes significant benefits to the economy. 
More than 95 percent of all overseas trade that enters or exits this 
country moves by ship, including 9 million barrels of oil a day that 
heats homes and businesses and fuels our automobiles.\1\ In addition, 
over $738 billion of goods are transported annually through U.S. ports 
and waterways.\2\
---------------------------------------------------------------------------

    \1\ See MTS Fact Sheet available at www.dot.gov/mts/fact_sheet.htm.
    \2\ See 2000 Exports and Imports by U.S. Customs District and 
Port available at www.marad.dot.gov/statistics/usfwts/.
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    Other benefits include the water transportation and the shipping 
industry that generate over $24 billion in revenue and provides nearly 
$3 billion of payrolls.\3\ The annual economic impact of cruise lines, 
passengers, and their suppliers is more than $11.6 billion in revenue 
and 176,000 in jobs for the U.S. economy.\4\ Our national defense is 
also dependent on the MTS. Approximately 90 percent of all equipment 
and supplies for Desert Storm were shipped from strategic ports via our 
inland and coastal waterways.\5\
---------------------------------------------------------------------------

    \3\ U.S. Census Bureau, 1997 Economic Census, Transportation and 
Warehousing-Subject Series.
    \1\ See footnote 1.
    \5\ See footnote 1.
---------------------------------------------------------------------------

The Ripple Effect of Port Closures on the U.S. Economy

    We could not only expect the immediate effects of port and waterway 
closures on waterborne commerce as described above, but also serious 
``ripple effects'' for the entire U.S. economy that could last for 
months or more, including delayed commerce, decreased productivity, 
price increases, increased unemployment, unstable financial markets 
worldwide, and economic recession.
    To appreciate the impact, we can examine just the agricultural 
sector of our economy. Many farm exports are just-in-time commodities, 
such as cotton shipped to Japan, South Korea, Indonesia, and Taiwan. 
Asian textile mills receive cotton on a just-in-time basis because 
these mills do not have warehousing capabilities. A port shutdown may 
cause U.S. cotton wholesalers to lose markets, as textile producers 
find suppliers from other nations. U.S. wholesalers would lose sales 
until shipping is restored.
    Another example is the auto industry. A recent shutdown of West 
Coast ports due to a labor dispute caused an automobile manufacturer to 
delay production because it was not receiving parts to make its cars. 
This demonstrates that a port shutdown can create a domino effect, from 
stalling the distribution of materials to causing stoppages and delays 
in production to triggering job losses, higher consumer prices, and 
limited selection.
    The macroeconomic effects of the recent shutdown of West Coast 
ports, while not in response to a security threat, are a good example 
of the economic costs that we could experience when a threat would 
necessitate broad-based port closures. The cost estimates of this 11-
day interruption in cargo flow and closure of 29 West Coast ports have 
ranged between $140 million to $2 billion a day, but are obviously high 
enough to cause significant losses to the U.S. economy.\6\
---------------------------------------------------------------------------

    \6\ See Lost Earnings Due to West Coast Port Shutdown-
Preliminary Estimate, Patrick Anderson, October 7, 2002, available 
at http://www.AndersonEconomicGroup.com; An Assessment of the Impact 
of West Coast Container Operations and the Potential Impacts of an 
Interruption of Port Operations, 2000, Martin Associates, October 
23, 2001, available from the Pacific Maritime Association. These two 
studies were widely quoted by most U.S. news services including Sam 
Zuckerman, San Francisco Chronicle, October 2002.
---------------------------------------------------------------------------

    Another proxy for the estimated costs to society of nationwide port 
closures and the consequential impact on the U.S. supply chain can be 
seen by a recent war game played by businesses and government 
agencies.\7\ In that recent war game, a terrorist threat caused 2 major 
ports to close for 3 days, and then caused a nationwide port closure 
for an additional 9 days. This closure spanned only 12 days, but 
resulted in a delay of approximately 3 months to clear the resulting 
containerized cargo backlog. The economic costs of the closings 
attributable to manufacturing slowdowns and halts in production, lost 
sales, and spoilage was estimated at approximately $58 billion. The 
simulation gauged how participants would respond to an attack and the 
ensuing economic consequences. Furthermore, a well-coordinated direct 
attack of multiple U.S. ports could shutdown the world economy by 
effectively halting international trade flows to and from the U.S. 
market-the largest market for goods and services in the world.
---------------------------------------------------------------------------

    \7\ The war game simulation was designed and sponsored by Booz 
Allen Hamilton and The Conference Board, details available at http://www.boozallen.com/.
---------------------------------------------------------------------------

    We believe that the cost to the national economy of a port shutdown 
due to extreme security threats, while not insignificant, would be 
relatively small if it only persisted for a few days and involved very 
few ports. However, if the interruption in cargo flows would persist 
much longer than the 11-day shutdown recently experienced on the West 
Coast, the economic loss is estimated to geometrically increase 
(double) every additional 10 days the ports were closed.\8\ At a 
certain point, companies would start declaring bankruptcies, people 
would be laid off indefinitely, and the prices of goods would increase. 
This effect would continue and intensify until alternate economic 
activities took place, such as the unemployed finding less desirable 
jobs or companies finding secondary lines of operations and suppliers. 
Regardless, the economic hardship suffered by industry, labor, and the 
loss of public welfare due to a sustained nationwide port shutdown may 
have as significant an effect on the U.S. as the act of terror itself.
---------------------------------------------------------------------------

    \8\ See Anderson.
---------------------------------------------------------------------------

Benefit Assessment

    The Coast Guard used the National Risk Assessment Tool (N-RAT) to 
assess benefits that would result from increased security for vessels, 
facilities, OCS facilities, and areas. The N-RAT considers threat, 
vulnerability, and consequences for several maritime entities in 
various security-related scenarios. For a more detailed discussion on 
the N-RAT and how we employed this tool, refer to ``Applicability of 
National Maritime Security Initiatives'' in the temporary interim rule 
titled ``Implementation of National Maritime Security Initiatives'' (68 
FR 39243) (part 101). For this benefit assessment, the Coast Guard used 
a team to calculate a risk score for each entity and scenario before 
and after the implementation of required security measures. The 
difference in before and after scores indicated the benefit of the 
proposed action.
    We recognized that the final rules are a ``family'' of rules that 
will reinforce and support one another in their implementation. We have 
ensured, however, that risk reduction that is credited in one rule is 
not also credited in another. For a more detailed discussion on the 
benefit assessment and how we addressed the potential to

[[Page 60467]]

double-count the risk reduced, refer to ``Benefit Assessment'' in the 
temporary interim rule titled ``Implementation of National Maritime 
Security Initiatives'' (68 FR 39274) (part 101).
    We determined annual risk points reduced for each of the six final 
rules using the N-RAT. Table 1 presents the annual risk points reduced 
by the final rules. As shown, the final rule for vessel security 
reduces the most risk points annually. The final rule for AIS reduces 
the least.

                             Table 1.--Annual Risk Points Reduced by the Final Rules
----------------------------------------------------------------------------------------------------------------
                                                     Annual risk points reduced by final rules
                                 -------------------------------------------------------------------------------
         Maritime entity              Vessel         Facility      OCS facility
                                     security        security        security           AMS             AIS
----------------------------------------------------------------------------------------------------------------
Vessels.........................         778,633           3,385           3,385           3,385           1,317
Facilities......................           2,025         469,686  ..............           2,025  ..............
OCS Facilities..................              41  ..............           9,903  ..............  ..............
Port Areas......................             587             587  ..............         129,792             105
                                 -----------------
    Total.......................         781,285         473,659          13,288         135,202           1,422
----------------------------------------------------------------------------------------------------------------

    Once we determined the annual risk points reduced, we discounted 
these estimates to their present value (7 percent discount rate, 2003-
2012) so that they could be compared to the costs. We presented the 
cost effectiveness, or dollars per risk point reduced, in two ways: 
First, we compared first-year cost to first-year benefit, because 
first-year cost is the highest in our assessment as companies develop 
security plans and purchase equipment. Second, we compared the 10-year 
present value cost to the 10-year present value benefit. The results of 
our assessment are presented in Table 2.

               Table 2.--First-Year and 10-Year Present Value Cost and Benefit of the Final Rules
----------------------------------------------------------------------------------------------------------------
                                                                    Final rule
                                 -------------------------------------------------------------------------------
              Item                    Vessel         Facility      OCS Facility
                                     security        security        security        AMS plans         AIS *
----------------------------------------------------------------------------------------------------------------
First-Year Cost (millions)......            $218          $1,125              $3            $120             $30
First-Year Benefit..............         781,285         473,659          13,288         135,202           1,422
First-Year Cost Effectiveness ($/           $279          $2,375            $205            $890         $21,224
 Risk Point Reduced)............
10-Year Present Value Cost                $1,368          $5,399             $37            $477             $26
 (millions).....................
10-Year Present Value Benefit...       5,871,540       3,559,655          99,863       1,016,074          10,687
10-Year Present Value Cost                  $233          $1,517            $368            $469         $2,427
 Effectiveness ($/Risk Point
 Reduced).......................
----------------------------------------------------------------------------------------------------------------
* Cost less monetized safety benefit.

    As shown, the final rule for vessel security is the most cost 
effective. This is due to the nature of the security measures we expect 
vessels will have to take to ensure compliance as well as the level of 
risk that is reduced by those measures. Facility security is less cost 
effective because facilities incur higher costs for capital purchases 
(such as gates and fences) and require more labor (such as security 
guards) to ensure security. OCS Facility and AMS Plans are almost 
equally cost effective; the entities these final rules cover do not 
incur the highest expenses for capital equipment, but on this relative 
scale, they do not receive higher risk reduction in the N-RAT, either. 
The AIS final rule is the least cost effective, though it is important 
to remember that AIS provides increased maritime domain awareness and 
navigation safety, which is not robustly captured using the N-RAT.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have 
considered whether this final rule would have a significant economic 
impact on a substantial number of small entities. The term ``small 
entities'' comprises small businesses, not-for-profit organizations 
that are independently owned and operated and are not dominant in their 
fields, and governmental jurisdictions with populations of less than 
50,000.
    We found that the facilities (part 105), vessels (part 104), and 
AIS rules may have a significant impact on a substantial number of 
small entities. However, we were able to certify no significant 
economic impact on a substantial number of small entities for this 
final rule and the Area Maritime Security (part 103) and OCS facility 
security (part 106) final rules. A complete small entity analysis may 
be found in the ``Cost Assessment and Final Regulatory Flexibility Act 
Analysis'' for these final rules in each of their respective dockets, 
where indicated under ADDRESSES.
    We received comments regarding small entities; these comments are 
discussed within the ``Discussion of Comments and Changes'' section of 
this final rule.

Assistance for Small Entities

    Under section 213(a) of the Small Business Regulatory Enforcement 
Fairness Act of 1996 (Public Law 104-121), we offered to assist small 
entities in understanding the rule so that they could better evaluate 
its effects on them and participate in the rulemaking. We provided 
small entities with a name, phone number, and e-mail address to contact 
if they had questions concerning the provisions of the final rules or 
options for compliance.
    We have placed Small Business Compliance Guides in the dockets for 
the Area Maritime, Vessel, and Facility Security and the AIS rules. 
These

[[Page 60468]]

Compliance Guides will explain the applicability of the regulations, as 
well as the actions small businesses will be required to take in order 
to comply with each respective final rule. We have not created 
Compliance Guides for this final rule (part 101) or for the OCS 
Facility Security final rule, as neither will affect a substantial 
number of small entities.
    Small businesses may send comments on the actions of Federal 
employees who enforce, or otherwise determine compliance with, Federal 
regulations to the Small Business and Agriculture Regulatory 
Enforcement Ombudsman and the Regional Small Business Regulatory 
Fairness Boards. The Ombudsman evaluates these actions annually and 
rates each agency's responsiveness to small business. If you wish to 
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR 
(1-888-734-3247).

Collection of Information

    This final rule contains no new collection of information 
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520). As defined in 5 CFR 1320.3(c), ``collection of information'' 
comprises reporting, recordkeeping, monitoring, posting, labeling, and 
other similar actions. The final rules are covered by two existing 
(OMB)-approved collections--1625-0100 [formerly 2115-0557] and 1625-
0077 [formerly 2115-0622].
    Comments regarding collection of information are addressed in the 
``Discussion of Comments and Changes'' sections of each final rule. You 
are not required to respond to a collection of information unless it 
displays a currently valid OMB control number. We received OMB approval 
for these collections of information on June 16, 2003. They are valid 
until December 31, 2003.

Federalism

    Executive Order 13132 requires the Coast Guard to develop an 
accountable process to ensure ``meaningful and timely input by State 
and local officials in the development of regulatory policies that have 
federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under the Executive Order, the Coast Guard may construe a 
Federal statute to preempt State law only where, among other things, 
the exercise of State authority conflicts with the exercise of Federal 
authority under the Federal statute.
    This action has been analyzed in accordance with the principles and 
criteria in the Executive Order, and it has been determined that this 
final rule does have Federalism implications and a substantial direct 
effect on the States. This final rule requires those States that own or 
operate vessels or facilities that may be involved in a transportation 
security incident to conduct security assessments of their vessels and 
facilities and to develop security plans for their protection. These 
plans must contain measures that will be implemented at each of the 
three MARSEC Levels and must be reviewed and approved by the Coast 
Guard.
    Additionally, the Coast Guard has reviewed the MTSA with a view to 
whether we may construe it as non-preemptive of State authority over 
the same subject matter. We have determined that it would be 
inconsistent with the federalism principles stated in the Executive 
Order to construe the MTSA as not preempting State regulations that 
conflict with the regulations in this final rule. This is because 
owners or operators of facilities and vessels--that are subject to the 
requirements for conducting security assessments, planning to secure 
their facilities and vessels against threats revealed by those 
assessments, and complying with the standards, both performance and 
specific construction, design, equipment, and operating requirements--
must have one uniform, national standard that they must meet. Vessels 
and shipping companies, particularly, would be confronted with an 
unreasonable burden if they had to comply with varying requirements as 
they moved from State to State. Therefore, we believe that the 
federalism principles enumerated by the Supreme Court in U.S. v. Locke, 
529 U.S. 89 (2000) regarding field preemption of certain State vessel 
safety, equipment, and operating requirements extends equally to this 
final rule, especially regarding the longstanding history of 
significant Coast Guard maritime security regulation and control of 
vessels for security purposes. But, the same considerations apply to 
facilities, at least insofar as a State law or regulation applicable to 
the same subject for the purpose of protecting the security of the 
facility would conflict with a Federal regulation; in other words, it 
would either actually conflict or would frustrate an overriding Federal 
need for uniformity.
    Finally, it is important to note that the regulations implemented 
by this final rule bear on national and international commerce where 
there is no constitutional presumption of concurrent State regulation. 
Many aspects of these regulations are based on the U.S. international 
treaty obligations regarding vessel and port facility security 
contained in SOLAS and the complementary ISPS Code. These international 
obligations reinforce the need for uniformity regarding maritime 
commerce.
    Notwithstanding the foregoing preemption determinations and 
findings, the Coast Guard has consulted extensively with appropriate 
State officials, as well as private stakeholders during the development 
of this final rule. For these final rules, we met with the National 
Conference of State Legislatures (NCSL) Taskforce on Protecting 
Democracy on July 21, 2003, and presented briefings on the temporary 
interim rules to the NCSL's Transportation Committee on July 23, 2003. 
We also briefed several hundred State legislators at the American 
Legislative Exchange Council on August 1, 2003. We held a public 
meeting on July 23, 2003, with invitation letters to all State homeland 
security representatives. A few State representatives attended this 
meeting and submitted comments to a public docket prior to the close of 
the comment period. The State comments to the docket focused on a wide 
range of concerns including consistency with international requirements 
and the protection of sensitive security information.
    One commenter stated that there should be national uniformity in 
implementing security regulations on international shipping.
    As stated in the temporary interim rule for part 101 (68 FR 39277), 
we believe that the federalism principles enumerated by the Supreme 
Court in U.S. v. Locke, 529 U.S. 89 (2000), regarding field preemption 
of certain State vessel safety, equipment, and operating requirements 
extends equally to this final rule, especially regarding the 
longstanding history of significant Coast Guard maritime security 
regulations and control of vessels for security purposes. It would be 
inconsistent with the federalism principles stated in Executive Order 
13132 to construe the MTSA as not preempting State regulations that 
conflict with these regulations. Vessels and shipping companies, 
particularly, would be confronted with an unreasonable burden if they 
had to comply with varying requirements as they move from state to 
state.

[[Page 60469]]

    Ten commenters addressed the disclosure of security plan 
information. One commenter advocated making security plans public. One 
commenter was concerned that plans will be disclosed under FOIA. One 
commenter requested that mariners and other employees, whose normal 
working conditions are altered by a Vessel or Facility Security Plan, 
be granted access to sensitive security information contained in that 
plan on a need-to-know basis. One commenter stated that Company 
Security Officers and Facility Security Officers should have reasonable 
access to AMS Plan information on a need-to-know basis. One commenter 
stated that the Federal government must preempt State law in instances 
of sensitive security information because some State laws require full 
disclosure of public documents. Three commenters supported our 
conclusion that the MTSA and our regulations preempt any conflicting 
State requirements. Another commenter was particularly pleased to 
observe the strong position taken by the Coast Guard in support of 
Federal preemption of conflicting State and local security regimes. One 
commenter supported our decision to designate security assessments and 
plans as sensitive security information.
    Portions of security plans are sensitive security information and 
must be protected in accordance with 49 CFR part 1520. Only those 
persons specified in 49 CFR part 1520 will be given access to security 
plans. In accordance with 49 CFR part 1520 and pursuant to 5 U.S.C. 
552(b)(3), sensitive security information is generally exempt from 
disclosure under FOIA, and TSA has concluded that State disclosure laws 
that conflict with 49 CFR part 1520 are preempted by that regulation. 
46 U.S.C. 70103(d) also provides that the information developed under 
this regulation is not required to be disclosed to the public. However, 
Sec. Sec.  104.220, 104.225, 105.210, 105.215, 106.215, and 106.220 of 
these rules state that vessel and facility personnel must have 
knowledge of relevant provisions of the security plan. Therefore, 
vessel and facility owners or operators will determine which provisions 
of the security plans are accessible to crewmembers and other 
personnel. Additionally, COTPs will determine what portions of the AMS 
Plan are accessible to Company or Facility Security Officers.
    One commenter stated that there is a ``real cost'' to implementing 
security measures, and it is significant. The commenter stated that 
there is a disparity between Federal funding dedicated to air 
transportation and maritime transportation and that the Federal 
government should fund maritime security at a level commensurate with 
the relative security risk assigned to the maritime transportation 
mode. Further, the commenter stated that, in 2002, some State-owned 
ferries carried as many passengers as one of the State's busiest 
international airports and provided unique mass transit services; 
therefore, the commenter supported the Alternative Security Program 
provisions of the temporary interim rule to enable a tailored approach 
to security.
    The viability of a ferry system to provide mass transit to a large 
population is undeniable and easily rivals other transportation modes. 
We developed the Alternative Security Program to encompass operations 
such as ferry systems. We recognize the concern about the Federal 
funding disparity between the maritime transportation mode and other 
modes; however, this disparity is beyond the scope of this rule.
    One commenter stated that while he appreciated the urgency of 
developing and implementing maritime security plans, the State would 
find it difficult to complete them based on budget cycles and building 
permit requirements. At the briefings discussed above, several NCSL 
representatives also voiced concerns over the short implementation 
period. In contrast, other NCSL representatives were concerned that 
security requirements were not being implemented soon enough.
    The implementation timeline of these final rules follows the 
mandates of the MTSA and aligns with international implementation 
requirements. While budget-cycle and permit considerations are beyond 
the scope of this rule, the flexibility of these performance-based 
regulations should enable the majority of owners and operators to 
implement the requirements using operational controls, rather than more 
costly physical improvement alternatives.
    Other concerns raised by the NCSL at the briefings mentioned above 
included questions on how the Coast Guard will enforce security 
standards on foreign flag vessels and how multinational crewmember 
credentials will be checked.
    We are using the same cooperative arrangement that we have used 
with success in the safety realm by accepting SOLAS certificates 
documenting flag-state approval of foreign SOLAS Vessel Security Plans 
that comply with the comprehensive requirements of the ISPS Code. The 
consistency of the international and domestic security regimes, to the 
extent possible, was always a central part of the negotiations for the 
MTSA and the ISPS Code. In the MTSA, Congress explicitly found that 
``it is in the best interests of the U.S. to implement new 
international instruments that establish'' a maritime security system. 
We agree and will exercise Port State Control to ensure that foreign 
vessels have approved plans and have implemented adequate security 
standards on which these rules are based. If vessels do not meet our 
security requirements, the Coast Guard may prevent those vessels from 
entering the U.S. or take other necessary measures that may result in 
vessel delays or detentions. The Coast Guard will not hesitate to 
exercise this authority in appropriate cases. We discuss the ongoing 
initiatives of ILO and the requirements under the MTSA to develop 
seafarers' identification criteria in the temporary interim rule titled 
``Implementation of National maritime Security Initiatives''(68 FR 
39264) (part 101). We will continue to work with other agencies to 
coordinate seafarer access and credentialing issues. These final rules 
will also ensure that vessel and facility owners and operators take an 
active role in deterring unauthorized access.
    One commenter, as well as participants of the NCSL, noted that some 
State constitutions afford greater privacy protections than the U.S. 
Constitution and that, because State officers may conduct vehicle 
screenings, State constitutions will govern the legality of the 
screening. The commenter also noted that the regulations provide little 
guidance on the scope of vehicle screening required under the 
regulations.
    The MTSA and this final rule are consistent with the liberties 
provided by the U.S. Constitution. If a State constitutional provision 
frustrates the implementation of any requirement in the final rule, 
then the provision is preempted pursuant to Article 6, Section 2, of 
the U.S. Constitution. The Coast Guard intends to coordinate with TSA 
and BCBP in publishing guidance on screening.

Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 
requires Federal agencies to assess the effects of their discretionary 
regulatory actions. In particular, the Act addresses actions that may 
result in the expenditure by a State, local, or Indian Tribal 
government, in the aggregate, or by the private sector of $100,000,000 
or more in any one year. This final rule is exempted from assessing the 
effects of

[[Page 60470]]

the regulatory action as required by the Act because it is necessary 
for the national security of the United States (2 U.S.C. 1503(5)). We 
did not receive comments regarding the Unfunded Mandates Reform Act.

Taking of Private Property

    This final rule will not effect a taking of private property or 
otherwise have taking implications under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights. We did not receive comments regarding the taking of 
private property.

Civil Justice Reform

    This final rule meets applicable standards in sections 3(a) and 
3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden. We did not receive 
comments regarding Civil Justice Reform.

Protection of Children

    We have analyzed this final rule under Executive Order 13045, 
Protection of Children from Environmental Health Risks and Safety 
Risks. While this final rule is an economically significant rule, it 
does not create an environmental risk to health or risk to safety that 
may disproportionately affect children. We did not receive comments 
regarding the protection of children.

Indian Tribal Governments

    This final rule does not have tribal implications under Executive 
Order 13175, Consultation and Coordination with Indian Tribal 
Governments, because it does not have a substantial direct effect on 
one or more Indian tribes, on the relationship between the Federal 
Government and Indian tribes, or on the distribution of power and 
responsibilities between the Federal Government and Indian tribes. We 
did not receive comments regarding Indian Tribal Governments.

Energy Effects

    We have analyzed this final rule under Executive Order 13211, 
Actions Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use. We have determined that it is not a ``significant 
energy action'' under that order. Although it is a ``significant 
regulatory action'' under Executive Order 12866, it is not likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy. The Administrator of the Office of Information and 
Regulatory Affairs has not designated it as a significant energy 
action. Therefore, it does not require a Statement of Energy Effects 
under Executive Order 13211.
    This final rule has a positive effect on the supply, distribution, 
and use of energy. The final rule provides for security assessments, 
plans, procedures, and standards, which will prove beneficial for the 
supply, distribution, and use of energy at increased MARSEC Levels. We 
did not receive comments regarding energy effects.

Environment

    We have considered the environmental impact of this final rule and 
concluded that, under Commandant Instruction M16475.lD, there are no 
factors in this case that would limit the use of a categorical 
exclusion under section 2.B.2 of the Instruction. Therefore, this final 
rule is categorically excluded, under figure 2-1, paragraphs (34)(a), 
(34)(c), (34)(d), and (34(e) of the Instruction from further 
environmental documentation.
    This final rule concerns security assessments, plans, training, 
positions, and organizations along with vessel equipment requirements 
that will contribute to a higher level of marine safety and security 
for U.S. ports. A ``Categorical Exclusion Determination'' is available 
in the docket where indicated under ADDRESSES or SUPPLEMENTARY 
INFORMATION.
    This final rule will not significantly impact the coastal zone. 
Further, the execution of this rule will be done in conjunction with 
appropriate State coastal authorities. The Coast Guard will, therefore, 
comply with the requirements of the Coastal Zone Management Act while 
furthering its intent to protect the coastal zone. We did not receive 
comments regarding the environment.

List of Subjects

33 CFR Part 2

    Administrative practice and procedure, Law enforcement.

33 CFR Part 101

    Facilities, Harbors, Maritime security, Ports, Security 
assessments, Security plans, Reporting and recordkeeping requirements, 
Vessels, Waterways.

33 CFR Part 102

    Maritime security.

0
Accordingly, the Coast Guard amends 33 CFR part 2 as follows and the 
interim rule adding 33 CFR parts 101 and 102 that was published at 68 
FR 39240 on July 1, 2003, and amended at 68 FR 41914 on July 16, 2003, 
is adopted as a final rule with the following changes:

PART 2--JURISDICTION

0
1. Revise the authority citation for part 2 to read as follows:

    Authority: 14 U.S.C. 633; 33 U.S.C. 1222; Pub. L. 89-670, 80 
Stat. 931, 49 U.S.C. 108; Pub. L. 107-296, 116 Stat. 2135, 2249, 6 
U.S.C. 101 note and 468; Department of Homeland Security Delegation 
No. 0170.1.


Sec.  2.22  [Amended]

0
2. In Sec.  2.22(a)(1)(i), after the words ``within subtitle II'', add 
the words ``and subtitle VI''.

PART 101--MARITIME SECURITY: GENERAL

0
3. The authority citation for part 101 continues to read as follows:

    Authority: 33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701; 50 
U.S.C. 191, 192; Executive Order 12656, 3 CFR 1988 Comp., p. 585; 33 
CFR 1.05-1, 6.04-11, 6.14, 6.16, and 6.19; Department of Homeland 
Security Delegation No. 0170.1.


0
4. Revise the heading to part 101 to read as shown above.

0
5. In Sec.  101.100, in the introductory text of paragraph (a), remove 
the word ``part'' and add, in its place, the word ``subchapter'', and 
add new paragraph (c) to read as follows:


Sec.  101.100  Purpose.

* * * * *
    (c) The assessments and plans required by this subchapter are 
intended for use in implementing security measures at various MARSEC 
Levels. The specific security measures and their implementation are 
planning criteria based on a set of assumptions made during the 
development of the security assessment and plan. These assumptions may 
not exist during an actual transportation security incident.

0
6. In Sec.  101.105--
0
a. In the definition of ``Barge fleeting facility'', remove the word 
``permitted'' and add, in its place, the words ``subject to 
permitting'', and, after the words ``33 CFR part 322'', add the words 
``, part 330, or pursuant to a regional general permit'';
0
b. In the definition of ``Cargo'', at the end of the paragraph, add the 
words ``, except dredge spoils'';
0
c. In the definition for ``Certain Dangerous Cargo (CDC)'', remove the 
text ``33 CFR 160.203'' and add, in its place, the text ``33 CFR 
160.204'';
0
d. In the definition of ``Company Security Officer (CSO)'', remove the 
text ``OSC'' wherever it appears, and add, in its place, the text 
``OCS'' and remove the word ``COTP'' and add, in its place, the words 
``Coast Guard'';
0
e. In the definition for ``Declaration of Security (DoS)'', remove the 
word

[[Page 60471]]

``interface'' wherever it appears and add, in its place, the word 
``activity'';
0
f. In the definition for ``Passenger vessel'', paragraph (1), after the 
word ``passengers'' add the words ``, including at least one passenger-
for-hire'';
0
g. In the definitions for ``Vessel-to-facility interface'', ``Vessel-
to-port interface'', and ``Vessel-to-vessel activity'' remove the word 
``goods'' wherever it appears and add, in its place, the words ``cargo, 
vessel stores,'';
0
h. Revise the definitions for ``Dangerous substances or devices'', 
``International voyage'', ``Owner or operator'', ``Unaccompanied 
baggage'', and ``Waters subject to the jurisdiction of the U.S.'' to 
read as set out below; and
0
i. Add, in alphabetical order, definitions for ``Breach of security'', 
``Cargo vessel'', ``Dangerous goods and/or hazardous substances'', 
``General shipyard facility'', and ``Public access facility'' to read 
as follows:


Sec.  101.105  Definitions.

* * * * *
    Breach of security means an incident that has not resulted in a 
transportation security incident, in which security measures have been 
circumvented, eluded, or violated.
* * * * *
    Cargo vessel means a vessel that carries, or intends to carry, 
cargo as defined in this section.
* * * * *
    Dangerous goods and/or hazardous substances, for the purposes of 
this subchapter, means cargoes regulated by parts 126, 127, or 154 of 
this chapter.
    Dangerous substances or devices means any material, substance, or 
item that reasonably has the potential to cause a transportation 
security incident.
* * * * *
    General shipyard facility means--
    (1) For operations on land, any structure or appurtenance thereto 
designed for the construction, repair, rehabilitation, refurbishment, 
or rebuilding of any vessel, including graving docks, building ways, 
ship lifts, wharves, and pier cranes; the land necessary for any 
structures or appurtenances; and the equipment necessary for the 
performance of any function referred to in this definition; and
    (2) For operations other than on land, any vessel, floating 
drydock, or barge used for, or a type that is usually used for, 
activities referred to in paragraph (1) of this definition.
* * * * *
    International voyage means a voyage between a country to which 
SOLAS applies and a port outside that country. A country, as used in 
this definition, includes every territory for the internal relations of 
which a contracting government to the convention is responsible or for 
which the United Nations is the administering authority. For the U.S., 
the term ``territory'' includes the Commonwealth of Puerto Rico, all 
possessions of the United States, and all lands held by the U.S. under 
a protectorate or mandate. For the purposes of this subchapter, vessels 
solely navigating the Great Lakes and the St. Lawrence River as far 
east as a straight line drawn from Cap des Rosiers to West Point, 
Anticosti Island and, on the north side of Anticosti Island, the 63rd 
meridian, are considered on an ``international voyage'' when on a 
voyage between a U.S. port and a Canadian port.
* * * * *
    Owner or operator means any person or entity that owns, or 
maintains operational control over, any facility, vessel, or OCS 
facility subject to this subchapter. This includes a towing vessel that 
has operational control of an unmanned vessel when the unmanned vessel 
is attached to the towing vessel and a facility that has operational 
control of an unmanned vessel when the unmanned vessel is not attached 
to a towing vessel and is moored to the facility; attachment begins 
with the securing of the first mooring line and ends with the casting-
off of the last mooring line.
* * * * *
    Public access facility means a facility--
    (1) That is used by the public primarily for purposes such as 
recreation, entertainment, retail, or tourism, and not for receiving 
vessels subject to part 104;
    (2) That has minimal infrastructure for servicing vessels subject 
to part 104 of this chapter; and
    (3) That receives only:
    (i) Vessels not subject to part 104 of this chapter, or
    (ii) Passenger vessels, except:
    (A) Ferries certificated to carry vehicles;
    (B) Cruise ships; or
    (C) Passenger vessels subject to SOLAS Chapter XI.
* * * * *
    Unaccompanied baggage means any baggage, including personal 
effects, that is not being brought on board on behalf of a person who 
is boarding the vessel.
* * * * *
    Waters subject to the jurisdiction of the U.S., for purposes of 
this subchapter, includes all waters described in section 2.36(a) of 
this chapter; the Exclusive Economic Zone, in respect to the living and 
non-living resources therein; and, in respect to facilities located on 
the Outer Continental Shelf of the U.S., the waters superjacent 
thereto.

0
7. In Sec.  101.120--
0
a. In paragraph (b)(1), remove the words ``engage on international 
voyages and facilities that serve only vessels on international 
voyages'' and add, in their place, the words ``are subject to SOLAS 
Chapter XI'';
0
b. In paragraph (b)(3), add the following words to the end of the last 
sentence: ``and a vessel, facility, or Outer Continental Shelf facility 
specific security assessment report generated under the Alternative 
Security Program'';
0
c. Add paragraph (b)(4) to read as set out below;
0
d. Revise paragraph (d) to read as set out below;
0
e. Add paragraphs (e) and (f) to read as follows:


Sec.  101.120  Alternatives.

* * * * *
    (b) * * *
    (4) Owners or operators shall make available to the Coast Guard, 
upon request, any information related to implementation of an approved 
Alternative Security Program.
* * * * *
    (d) Amendment of Approved Alternative Security Programs. (1) 
Amendments to an Alternative Security Program approved under this 
section may be initiated by--
    (i) The submitter of an Alternative Security Program under 
paragraph (c) of this section; or
    (ii) The Coast Guard upon a determination that an amendment is 
needed to maintain the security of a vessel or facility. The Coast 
Guard will give the submitter of an Alternative Security Program 
written notice and request that the submitter propose amendments 
addressing any matters specified in the notice. The submitter will have 
at least 60 days to submit its proposed amendments.
    (2) Proposed amendments must be sent to the Commandant (G-MP). If 
initiated by the submitter, the proposed amendment must be submitted at 
least 30 days before the amendment is to take effect unless the 
Commandant (G-MP) allows a shorter period. The Commandant (G-MP) will 
approve or disapprove the proposed amendment in accordance with 
paragraph (f) of this section.
    (e) Validity of Alternative Security Program. An Alternative 
Security

[[Page 60472]]

Program approved under this section is valid for 5 years from the date 
of its approval.
    (f) The Commandant (G-MP) will examine each submission for 
compliance with this part, and either:
    (1) Approve it and specify any conditions of approval, returning to 
the submitter a letter stating its acceptance and any conditions;
    (2) Return it for revision, returning a copy to the submitter with 
brief descriptions of the required revisions; or
    (3) Disapprove it, returning a copy to the submitter with a brief 
statement of the reasons for disapproval.

0
8. Add the text to Sec.  101.125 to read as follows:


Sec.  101.125  Approved Alternative Security Programs.

    The following have been approved, by the Commandant (G-MP), as 
Alternative Security Programs, which may be used by vessel or facility 
owners or operators to meet the provisions of parts 104, 105, or 106 of 
this subchapter, as applicable:
    (a) American Gaming Association Alternative Security Program, dated 
September 11, 2003.
    (b) American Waterways Operators Alternative Security Program for 
Tugboats, and Towboats and Barges, dated September 24, 2003.
    (c) Passenger Vessel Association Industry Standards for Security of 
Passenger Vessels and Small Passenger Vessels, dated September 17, 
2003.


Sec.  101.205  [Amended]

0
9. In Sec.  101.205, in table 101.205, remove the words ``Elevated: 
Blue'' and ``Guarded: Yellow.'', and add, in their place, the words 
``Guarded: Blue'' and ``Elevated: Yellow'' respectively.


Sec.  101.300  [Amended]

0
10. In Sec.  101.300--
0
a. In paragraph (a), remove the words ``a Maritime Security Directive 
issued under section 101.405 of this part'' and add, in their place, 
the words ``an electronic means, if available''; and
0
b. In paragraphs (c)(1) and (c)(2), remove the word ``confirm'' and 
add, in its place, the words ``ensure confirmation''.


Sec.  101.405  [Amended]

0
11. In Sec.  101.405(a)(2), remove the words ``require the owner or 
operator to prove that they have a `need to know' the information in 
the MARSEC Directive and that they are a `covered person,' as those 
terms are defined in 49 CFR part 1520'' and add, in their place, the 
words ``require owners or operators to prove that they are a person 
required by 49 CFR 1520.5(a) to restrict disclosure of and access to 
sensitive security information, and that under 49 CFR 1520.5(b), they 
have a need to know sensitive security information''.


Sec.  101.410  [Amended]

0
12. In Sec.  101.410(b)(8), remove the words ``For U.S. vessels, 
suspension or revocation of security plan approval'', and add, in their 
place, the words ``Suspension or revocation of a security plan approved 
by the U.S.''.

0
13. In Sec.  101.420, revise paragraph (b) to read as follows:


Sec.  101.420  Right to appeal.

* * * * *
    (b) Any person directly affected by a decision or action taken by a 
District Commander, whether made under this subchapter generally or 
pursuant to paragraph (a) of this section, with the exception of those 
decisions made under Sec.  101.410 of this subpart, may appeal that 
decision or action to the Commandant (G-MP), according to the 
procedures in 46 CFR 1.03-15. Appeals of District Commander decisions 
or actions made under Sec.  101.410 of this subpart should be made to 
the Commandant (GMOC), according to the procedures in 46 CFR 
1.03-15.
* * * * *

0
14. In Sec.  101.505(b), at the end of the paragraph, add a sentence to 
read as follows:


Sec.  101.505  Declaration of Security (DoS).

* * * * *
    (b) * * * A DoS must, at a minimum, include the information found 
in the ISPS Code, part B, appendix 1 (Incorporated by reference, see 
Sec.  101.115).
* * * * *


Sec.  101.510  [Amended]

0
15. In Sec.  101.510, in the introductory text--
0
a. Remove the word ``risk'' and add, in its place, the word 
``security''; and
0
b. After the words ``These tools'', add the word ``may''.

0
16. In Sec.  101.515 add paragraph (c) to read as follows:


Sec.  101.515  Personal identification.

* * * * *
    (c) Vessel, facility, and OCS facility owners and operators must 
permit law enforcement officials, in the performance of their official 
duties, who present proper identification in accordance with this 
section to enter or board that vessel, facility, or OCS facility at any 
time, without delay or obstruction. Law enforcement officials, upon 
entering or boarding a vessel, facility, or OCS facility, will, as soon 
as practicable, explain their mission to the Master, owner, or 
operator, or their designated agent.

PART 102--MARITIME SECURITY: NATIONAL MARITIME TRANSPORATION 
SECURITY [RESERVED]

0
17. Revise the heading to part 102 to read as shown above.

    Dated: October 8, 2003.
Thomas H. Collins,
Admiral, Coast Guard, Commandant.
[FR Doc. 03-26345 Filed 10-20-03; 8:45 am]
BILLING CODE 4910-15-P