This proposal, in part, is to comply with Public Law 104-19, section 504(a): establish and adhere to a schedule for the completion of National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq. ) analysis and decision on all grazing allotments within the National Forest System unit for which NEPA is needed (Pub. L. 104-19, General Provision 1995). Upon completion of the NEPA analysis and decisions for the allotments, the terms and conditions of the existing grazing permits will be modified, as necessary, to conform to such NEPA analysis. In addition, the purpose of the proposed action is to improve range condition and trend and achieve desired conditions within the project area through livestock grazing.

The proposed action is to authorize continued livestock grazing, provide analysis and data to update allotment management plans (AMPs), and allow livestock grazing that meets or moves existing resources conditions toward desired conditions on National Forest grazing allotments while complying with applicable statutes. Adaptive management, which allows flexibility during the implementation of the grazing strategy, would allow managers to make adjustments and corrections to management based on monitoring.

Grazing as Currently Permitted: Although allotment management plans (AMP's) would be prepared for each of the nine allotments, the grazing management practices specified for the allotments with existing AMP's would not be changed. In addition, no new utilization standards would be initiated to move existing resource conditions in the project area toward the desired future conditions (DFC's) specified in the Forest Plan.

No Grazing by Domestic Livestock (No grazing alternative): This would eliminate livestock grazing in the project area. This alternative was developed to demonstrate the effects that eliminating livestock grazing would have on the environment and to more clearly illustrate the potential effects of implementing other alternatives. Under this alternative, domestic livestock grazing on all nine allotments within the project area would be phased out over several years as existing Term Grazing Permits expire.

Russell Bacon, District Forest Ranger, Kemmerer Ranger District, P.O. Box 31, Kemmerer, Wyoming 83101 and Charlene Bucha-Gentry, District Forest Ranger, Greys River Ranger District, P.O. Box 339, Afton, Wyoming 83110.

The decision, which is based on this analysis, will be to decide if livestock will be allowed to graze on the allotment complex, either through the implementation of the proposed action, or an alternative to the proposed action. The decision would include any mitigation measures needed in addition to those prescribed in the Forest Plan.

Forest Service is seeking information, comments, and assistance from individuals, organizations, tribal governments, and federal, state, and local agencies interested in or affected by this project. This analysis is for nine grazing allotments. The decision will have limited environmental effects outside the allotment boundaries, and the economic impacts are localized. Public participation will be solicited by notifying in person and/or by mail known interested affected publics. News releases will be used to give the public general notice. Public participation activities would include requests for written comments. The first formal opportunity to comment is to respond to this notice of intent, which initiates the scoping process (40 CFR 1501.7). Scoping includes: (1) Identifying potential issues, (2) narrowing the potential issues and identifying significant issues of those that have been covered by prior environmental review, (3) exploring alternatives in addition to No Action, and (4) identifying potential environmental effects of the proposed action and alternatives.

The Forest Service has identified the following potential issues. Your input is especially valuable here. It will help us determine which of these merit detailed analysis. It will also help identify additional issues related to the proposed action that may not be listed here.

• Effects of grazing on soil erosion and productivity.

• Effects of grazing on watershed condition and function.

• Effects of grazing on the life cycle of the Bonneville and Snake River cutthroat trout.

This notice of intent initiates the scoping process which guides the development of the environmental impact statement.

Early Notice of Importance of Public Participation in Subsequent Environmental Review: A draft environmental impact statement will be prepared for comment. The comment period on the draft environmental impact statement will be 45 days from the date the Environmental Protection Agency publishes the notice of availability in the Federal Register .

The Forest Service believes, at this early stage, it is important to give reviewers notice of: several court rulings related to public participation in the environmental review process. First, reviewers of draft environmental impact statements must structure their participation in the environmental review of the proposal so that it is meaningful and alerts an agency to the reviewer's position and contention. Vermont Yankee Nuclear Power Corp v. NRDC , 435 U.S. 519, 533 (1978). Also, environmental objections that could be raised at the draft environmental impact statement stage but that are not raised until after completion of the final environmental impact statement may be waived or dismissed by the courts. City of Angoon v. Hodel , 803 F.2d 1016, 1022 (9th Cir. 1986) and Wisconsin Heritages, Inc. v. Harris , 490 F. Supp. 1334, 1338 (E.D. Wis. 1980). Because of these court rulings, it is very important that those interested in this proposed action participate by the close of the 45 day comment period so that substantive comments and objections are made available to the Forest Service at a time when it can meaningully consider them and respond to them in the final environmental impact statement.

To assist the Forest Service in identifying and considering issues and concerns on the proposed action, comments on the draft environmental impact statement should be as specific as possible. It is also helpful if comments refer to specific pages or chapters of the draft statement. Comments may also address the adequacy of the draft environmental impact statement or the merits of the alternatives formulated and discussed in the statement. Reviewers may wish to refer to the Council on Environmental Quality Regulations for implementing the procedural provisions of the National Environmental Policy Act at 40 CFR 1503.3 in addressing these points.

Comments received, including the names and addresses of those who comment, will be considered part of the public record on this proposal and will be available for public inspection.

Section 343 of the Federal Agricultural Improvement and Reform Act of 1966 states that revisions made after enactment of the law to NRCS State Technical Guides used to carry out highly erodible land and wetland provisions of the law shall be made available for public review and comment. For the next 30 days the NRCS will receive comments relative to the proposed changes. Following that period a determination will be made by the NRCS regarding disposition of those comments and a final determination of change will be made.

The establishment of MAFAC was approved by the Secretary on December 28, 1970, and initially chartered under the Federal Advisory Committee Act, 5, U.S.C. App.2, on February 17, 1971. The Committee meets twice a year with supplementary subcommittee meetings as determined necessary by the Secretary. Individuals serve for a term of three years for no more than two consecutive terms if re-appointed. No less that 15 and no more than 21 individuals may serve on the Committee. Membership is comprised of highly qualified individuals representing commercial and recreational fisheries interests, environmental organizations, academic institutions, governmental, tribal and consumer groups from a balance of geographical regions, including the Hawaiian and the Pacific Islands, and the U.S. Virgin Islands. Nominations are encouraged from all interested parties involved with or representing interests affected by Agency actions in managing living marine resources. Nominees should possess demonstrable expertise in a field related to the management of living marine resources and be able to fulfill the time commitments required for two meetings annually.

A MAFAC member cannot be a Federal agency employee or a member of a Regional Fishery Management Council. Selected candidates must have security checks and complete financial disclosure forms. Membership is voluntary, and except for reimbursable travel and related expenses, service is without pay.

Each submission should include the submitting person's or organization's name and affiliation, a cover letter describing the nominee's qualifications and interest in serving on the Committee, a curriculum vitae or resume of nominee, and no more than three supporting letters describing the nominee's qualifications and interest in serving on the Committee. Self-nominations are acceptable. The following contact information should accompany each nominee's submission: name, address, phone number, fax number, and e-mail address if available.

Nominations should be sent to (see ADDRESSES ) and nominations must be received by (see DATES ). The full text of the Committee Charter and its current membership can be viewed at the Agency's web page at www.nmfs.noaa.gov/mafac.htm .

Issuance of permits and permit modifications, as required by the Endangered Species Act of 1973 (16 U.S.C. 1531 1543) (ESA), is based on a finding that such permits/modifications: (1) are applied for in good faith; (2) would not operate to the disadvantage of the listed species which are the subject of the permits; and (3) are consistent with the purposes and policies set forth in section 2 of the ESA. Authority to take listed species is subject to conditions set forth in the permits. Permits and modifications are issued in accordance with and are subject to the ESA and NMFS regulations governing listed fish and wildlife permits (50 CFR parts 222-226).

Those individuals requesting a hearing on an application listed in this notice should set out the specific reasons why a hearing on that application would be appropriate (see ADDRESSES). The holding of such a hearing is at the discretion of the Assistant Administrator for Fisheries, NOAA. All statements and opinions contained in the permit action summaries are those of the applicant and do not necessarily reflect the views of NMFS.

This notice is relevant to federally endangered Sacramento River winter-run Chinook salmon ( Oncorhynchus tshawytscha ) and Southern California steelhead ( O. mykiss ), threatened Central Valley steelhead ( O. mykiss ), Central California Coast steelhead ( O. mykiss ), and Central California Coast coho salmon ( O. kisutch ).

AAR requests to renew and modify a 5-year permit (1166) for take of juvenile Sacramento River winter-run Chinook salmon and Central Valley steelhead to conduct pre-project fish surveys on the San Joaquin River and Old River in California. AAR requests authorization for an estimated annual take of 30 juvenile Sacramento River winter-run Chinook salmon and 80 juvenile Central Valley steelhead, with no more than 5 percent unintentional mortality to result from capture by beach seine, scale samples, and release of fish.

AAR also requests take of juvenile Central California Coast steelhead and juvenile Central California Coast coho salmon to conduct pre- and post-project fish surveys, relocation activities, and fish monitoring activities in various streams in Marin, Sonoma and Mendocino counties. AAR requests authorization for an estimated annual take of 450 juvenile Central California Coast steelhead, and 50 juvenile Central California Coast coho salmon, with no more than 5 percent unintentional mortality to result from capture (dip net, seine, electrofishing) and release of fish.

In addition, AAR requests take of juvenile Southern California steelhead to conduct fish monitoring activities in Hilton Creek, tributary to the Santa Ynez River in Santa Barbara County. AAR requests authorization for an estimated annual take of 2 juvenile Southern California Coast steelhead with no more than 5 percent unintentional mortality to result from capture (dip net, seine, electrofishing) and release of fish.

The following species and Evolutionarily Significant Units (ESUs) are covered in this notice:

Chinook salmon ( O. tshawytscha ): the Sacramento River winter-run, Central Valley spring-run, California Coastal, Upper Willamette River, Lower Columbia River, Puget Sound, Snake River fall-run, and Snake River spring/summer-run chinook ESUs;

Coho salmon ( O. kisutch ): Southern Oregon/Northern California Coast, Oregon coast, and Lower Columbia River coho ESUs;

Sockeye salmon ( O. nerka ): the Ozette Lake sockeye ESU;

Chum salmon ( O. keta ): the Columbia River and Hood Canal summer-run chum ESUs;

Steelhead and rainbow trout ( O. mykiss ): South-Central California Coast, Central California Coast, California Central Valley, Northern California, Upper Willamette River, Lower Columbia River, Middle Columbia River, Snake River Basin, and Upper Columbia River O. mykiss ESUs.

On June 14, 2004, NMFS published proposed ESA listing determinations for 27 ESUs of salmon and O. mykiss (69 FR 33101). NMFS proposed threatened status for 23 ESUs in California, Oregon, Washington, and Idaho, and as part of that rulemaking also proposed amendments to the existing 4(d) protective regulations for threatened salmon and steelhead ESUs. The National Environmental Policy Act (NEPA) requires that Federal agencies conduct an environmental analysis of their actions to determine if the actions may affect the human environment. Accordingly, NMFS has prepared a draft EA that analyzes the impacts of the proposed amendments to the 4(d) protective regulations for West Coast salmonids, and is making it available for public review and comment.

This draft EA analyzes two alternatives: (1) No Action (no revision to the current 4(d) protective regulations); and (2) the Proposed Action Alternative (revision and simplification of existing 4(d) protective regulations). The Proposed Action Alternative includes the following amendments:

Apply the 4(d) protections and 14 limits promulgated in 2000 (as modified in the proposed amendments) to three ESUs being newly proposed for threatened status; Apply the same 4(d) protections and 14 limits promulgated in 2000 (as modified in proposed amendments) to all threatened ESUs; Amend an expired 4(d) limit which provided a temporary exemption for ongoing research with pending permit applications during the 2000 4(d) rulemaking, to temporarily exempt ongoing research during the current rulemaking process; Move the description of the limit for Tribal Resource Management Plans (§ 223.209) so that the text would appear next to the 4(d) rule in the Code of Federal Regulations, improving the clarity of the 4(d) regulations; and Amend the current 4(d) rule so that the section 9(a) take prohibitions apply to anadromous fish with an intact adipose fin only (that is, the take prohibitions and 4(d) protective regulations would not apply to unclipped hatchery fish or resident O. mykiss included in the subject ESUs).

Because the proposed action creates an optional ESA process, the effects that it may generate are limited to those associated with amending the 4(d) protective regulations. The proposed action does not address the potential effects of individual activities or programs that may seek coverage under one of the 4(d) “limits.” It is impossible to anticipate the specific impacts of such programs that may be submitted to and approved by NMFS. NMFS will conduct further NEPA analyses as necessary when a specific program is submitted to NMFS for coverage under one of the 4(d) limits for West Coast salmonids.

This notice is provided pursuant to the NEPA regulations (40 CFR 1506.6). The final NEPA determinations will not be completed until after the end of the 30-day comment period and after NMFS has fully considered all comments received during the public comment period.

The MMPA, 16 U.S.C. 1361 et seq., allows entry into the United States of yellowfin tuna harvested by purse seine vessels in the ETP under certain conditions. Under implementing regulations at 50 CFR 216.24, a nation with purse seine vessels greater than 400 short tons (362.8 metric tons) carrying capacity fishing for tuna in the ETP must have an affirmative finding in order to export such tuna and tuna products to the United States. If requested by the harvesting nation, the Assistant Administrator will determine whether to make an affirmative finding based upon documentary evidence provided by the government of the harvesting nation, the IATTC, or the Department of State. The finding will be reviewed annually to ensure that the nation continues to meet the requirements for an affirmative finding. The requirements must be met in order for the finding to remain valid for the following 12-month period: April 1 through March 31, or for such other period as the Assistant Administrator may determine.

The affirmative finding process requires that the harvesting nation meet several conditions related to compliance with the IDCP. Every 5 years, the government of the harvesting nation must request an affirmative finding and submit the required documentary evidence directly to the Assistant Administrator. A nation may opt to provide information regarding compliance with the IDCP directly to NMFS on an annual basis or to authorize the IATTC to release the information to NMFS in years when NMFS will review and consider whether to issue an affirmative finding determination without an application from the harvesting nation.

An affirmative finding will be terminated, in consultation with the Secretary of State, if the Assistant Administrator determines that the requirements of 50 CFR 216.24(f) are no longer being met or that a nation is consistently failing to take enforcement actions on violations which diminish the effectiveness of the IDCP. Every 5 years, the government of the harvesting nation must request an affirmative finding and submit the required documentary evidence directly to the Assistant Administrator.

As a part of the annual review process set forth in 50 CFR 216.24(f), the Assistant Administrator considered documentary evidence submitted by the Republic of Ecuador and obtained from the IATTC and the Department of State and determined that Ecuador has met the MMPA's requirements to receive an affirmative finding.

After consultation with the Department of State, NMFS renewed the Republic of Ecuador's affirmative finding allowing the continued importation into the United States of yellowfin tuna and products derived from yellowfin tuna harvested in the ETP by Ecuadorian-flag purse seine vessels or vessels operating under Ecuadorian jurisdiction.

The Republic of Ecuador must submit a new application no later than January 2005 for an affirmative finding to be effective for the period April 1, 2005, through March 31, 2006, and the subsequent 4 years.

The following species and evolutionarily significant units (ESUs) are covered in the permit:

Steelhead ( Oncorhynchus mykiss ): endangered Upper Columbia River.

Chinook salmon ( O. tshawytscha ): endangered Upper Columbia River spring run.

Issuance of this permit, as required by the ESA, was based on a finding that such permits: (1) were applied for in good faith; (2) will not operate to the disadvantage of the listed species which are the subject of the permits; and (3) is consistent with the purposes and policies set forth in section 2 of the ESA. This permit was issued in accordance with, and is subject to, 50 CFR part 222, the NMFS regulations governing listed species permits.

The Commodity Futures Modernization Act of 2000 (“CFMA”), Public Law No. 106-554, was signed into law on December 21, 2000. Under amendments implemented by the CFMA, section 2(h)(3) of the Act authorizes trading in an “exempt commodity”  3 on an exempt commercial market (“ECM”) meeting the requirements of section 2(h) (3)-(5). Under those provisions, transactions between an eligible commercial entity (“ECE”) in an exempt commodity on an ECM are exempt from all but certain limited requirements of the Act. 4

Section 1a(11) of the Act lists those eligible contract participants (“ECP”)  5 that are qualified to be ECEs. 6 As defined under section 1a(11), floor brokers and floor traders, even if determined to fall within the definition of an ECP, do not, as a category, fall within the statutory definition of an ECE. Thus, commodity brokers and traders, whether conducting business in either electronic or open outcry trading environments, are prohibited from entering into transactions on ECMs.

Section 1a(11)(C) of the Act, however, vests the Commission with discretion to expand the list of entities qualifying as an ECE. Specifically, under that provision, the definition of an ECE shall include “such other persons as the Commission shall determine appropriate and shall designate by rule, regulation, or order.” Therefore, a Commission-determination recognizing that IPE brokers and traders, either authorized by FSA or registered with IPE, are considered to be ECEs would permit these entities to enter into exempt commodity transactions on ECMs pursuant to section 2(h)(3) of the Act.

By letter dated February 9, 2004, Intercontinental requested that the Commission issue an order pursuant to section 1a(11) of the Act that would expand the ECE category to include certain IPE brokers and local traders, who are either authorized by FSA or registered with IPE, thus permitting them to trade on ECMs. 7 Intercontinental operates a commodities trading platform for energy and metals (the “Intercontinental electronic platform”) and is itself an ECM. Intercontinental also owns IPE, a U.K. futures exchange that trades energy futures products. The Intercontinental electronic platform is used by IPE for its electronic trading system. Intercontinental stated that including IPE brokers and local traders as ECEs would be consistent with the CFMA and would recognize their value as both liquidity providers and market makers.

As more fully described below, Intercontinental's request applies to certain IPE brokers and local traders conducting business on IPE in either electronic or open outcry trading environments. 8 Specifically, Intercontinental proposed that eligible IPE brokers must be located in the U.K., be authorized and regulated by the FSA, and be a member of the IPE. For IPE local traders, Intercontinental proposed that eligible local traders be located in the U.K., be outside the scope of the Financial Services and Markets Act of 2000 (“FSMA”), and be a member of, or registered to, the IPE. Additionally, for both brokers and local traders, Intercontinental proposed that they have, as a part of their business activities, the business of acting as a broker or local trader but need not have any connection or experience in the underlying physical commodity. Finally, Intercontinental proposed that an eligible IPE broker or local trader must be an ECP or, if not an ECP, then the IPE broker or local trader must have its trades on the ECM guaranteed by an entity that is both an ECP and a clearing member of a U.K. recognized clearing organization.

In its petition, Intercontinental noted that the Commission has previously expanded the eligibility criteria for ECE status to include Commission-registered floor brokers and floor traders when acting in a proprietary trading capacity. In this respect, Intercontinental commented that the relief it seeks for IPE brokers and local traders is an appropriate extension of the Commission's previous expansion of the ECE definition. Moreover, Intercontinental contends that the IPE brokers and local traders, much as the CFTC registered floor brokers and floor traders qualifying under the Commission's prior action, are commodity professionals supervised by a central regulator, the FSA, or the IPE. Intercontinental also notes that the IPE brokers and local traders regularly trade on the IPE as part of their business and would utilize ECMs in connection with their trading activities. Intercontinental also observes that the Commission's prior action effectively acknowledges that floor brokers and floor traders are sophisticated market participants who are subject to a comprehensive regulatory scheme, such as that provided under FSA and IPE regulations. Intercontinental concludes that IPE brokers and local traders satisfy similar criteria, including that of having their trades guaranteed by the arrangements put in place by an RIE, and should therefore be eligible for the same type of relief. 9

The petition requests that the ECE definition be expanded to include IPE brokers that are located in the UK when acting in a proprietary capacity. The IPE brokers include IPE Floor Members and IPE General Participants. IPE Floor Members may trade in either the open outcry or electronic markets; General Participants are restricted to the electronic market only.

As the petition describes, IPE brokers are firms authorized to transact business on behalf of customers or for the firm's proprietary account. 10 When acting on behalf of customers, the firm's business activities fall within the scope of the FSMA. Thus, a firm conducting such activities in the UK is subject to regulation by the FSA. Among other qualifying criteria, such firms must obtain FSA authorization prior to engaging in the commodity brokerage business. 11

As there are two separate trading venues at IPE, conduct of business by IPE brokers may take two different forms. Each IPE floor-based broker ( i.e. , Floor Members) is represented on the trading floor by one or more individual traders. 12

General Participants are IPE brokers authorized to conduct business solely on the electronic trading platform. IPE-established eligibility requirements for this class of membership differ from those applicable to floor members. However, both classes of IPE brokers are authorized by FSA and therefore under FSA oversight. When operating on the IPE electronic trading platform, representatives of IPE General Participants are registered with the IPE as a Responsible Individual (“RI”) or, alternatively, are registered with the FSA as an Approved Person linked to a particular General Participant. 13

The petition also requests that the ECE definition be expanded to include IPE local traders located in the UK. Under IPE rules, local traders are authorized to trade for their own account but are prohibited from engaging in customer brokerage. As noted above, IPE local traders as a class are composed of two separate types of holders of trading privileges. These are Local Members and Individual Participants. 14 Qualifying criteria for these two trader classes differ in some respects. Local Members hold privileges to trade on the IPE floor. 15 Individual Participants are authorized to trade solely on the electronic trading platform. 16

Notably, both Local Members and Individual Participants are outside the scope of the FSMA and therefore need not be authorized by the FSA—either when trading on IPE on behalf of their own account or on behalf of other IPE members. 17 However, both Local Members and Individual Participants must be members of, or registered with, the IPE, and must meet independent qualifying criteria established by IPE under an FSA-recognized regime. 18 The IPE actively monitors Local Member and Individual Participant trading activity, and has authority to impose sanctions for improper trading conduct. 19

IPE affirms that it will determine whether an applicant has substantial qualifying experience by applying the standards set out under the definition of an Intermediate Customer contained in FSA regulations. In particular, IPE represents that the standards defining an expert private client as an Intermediate Customer found in Rule 4.1.9R of the FSA Conduct of Business (“COB”) sourcebook will be applied as the primary guide in determining the adequacy of an applicant's experience for this purpose.

COB Rule 4.1.9R imposes a two-tiered regulatory structure on financial services firms servicing accounts of expert private clients. This structure is divided between (1) procedural steps in establishing a client relationship with an expert private client and (2) objective steps in determining the adequacy of the expert private client's trading and business experience. More specifically, under FSA regulations, a financial intermediary is required to classify a client in one of three classifications: these are private (“retail”) customer, intermediate customer, or market counterparty. 20 Provisions under COB Rule 4.1.9R, permit a financial services firm to classify a client who would otherwise be a private, or retail, customer as an Intermediate Customer only upon a determination that the client is an “expert” private client.

COB 4.1.9R requires a firm to assess the adequacy of a client's experience and knowledge as an expert private client. 21 In this respect, COB Rule 4.1.9R requires that a firm inquire about the client's knowledge, understanding, and awareness of risks in the applicable investments and markets. The rule also requires a firm to consider the length of time the client has been active in the applicable markets, the frequency of dealings, and the extent to which the client has relied on advice. Finally, the rule instructs a firm to inquire about or consider the size and nature of any transactions undertaken for the client, and the client's financial standing, including where appropriate an assessment of the client's net worth and portfolio holdings.

Essentially, IPE has determined to adopt the COB Rule 4.1.9R standards as qualifying criteria for applicants as IPE Individual Participants. Thus, these standards, otherwise imposed upon financial services firms regulated by FSA, will also be part of IPE procedures and serve as a screening device for determining the sufficiency of an applicant's experience and knowledge for admission on the IPE as an Individual Participant. In this respect, IPE confirms that its application of the criteria found in Rule 4.1.9R, to assess experience and knowledge of Individual Participant applicants, will be part of an independent determination made by IPE management. Moreover, IPE represents that any prior status an applicant may have attained as a customer of a financial services firm would not be determinative of eligibility, but that IPE would undertake an independent assessment of the applicant's experience and knowledge under the standards of COB Rule 4.1.9R.

The Intercontinental petition was published in the Federal Register for a 15-day public comment period on March 22, 2004. 22 In addition, the Federal Register release includes a series of questions posed by the Commission regarding the petition. Those questions focus on whether the petition should be granted; what conditions if any should apply; whether any grant of the petition should be specifically tailored to the Intercontinental ECM or be more broadly applied to other ECMs as well; whether relief should extend to IPE traders with rights to trade only on the IPE electronic platform, or to IPE locals not registered with the FSA and, if so, what standards should apply to evaluate the qualifications of such persons.

In total, the Commission received three comment letters responding to the Federal Register notice, two of which were submitted by the New York Mercantile Exchange (“NYMEX”) in letters dated April 7, and May 27, 2004. The other comment was submitted by Intercontinental in a letter dated April 28, 2004. The Intercontinental comment letter primarily responded to issues critically raised in the NYMEX letter of April 7, 2004.

The NYMEX comment letters include a generalized critical assessment of the petition. In so doing, the letters characterize the relief being sought as “broad and unrestricted,” and argue against the grant of the petition. In arriving at this conclusion, NYMEX emphasizes several different aspects of the IPE institutional and regulatory environment.

In particular, NYMEX sets out its view of the regulatory landscape governing ECMs as one in which statutory exemption is conditioned on the commercial nature of the market. Following this line of reasoning, NYMEX asserts that the IPE electronic traders are best characterized as representing a retail rather than a commercial interest and, on that basis, concludes they should be denied eligibility to obtain trading privileges on ECMs.

In amplifying its objection to a grant of access for IPE electronic traders, NYMEX asserts that granting the petition for IPE electronic traders would open ECM access to a “potentially large group of unschooled and unsophisticated electronic traders who are not required to be registered here or in the U.K.” NYMEX further concludes that granting such regulatory relief could impose risks to the integrity of trading on an ECM. Thus, NYMEX concludes that a grant of relief sought by Intercontinental would be contrary to statutory intent and the public interest.

Along a similar line of reasoning, NYMEX questions whether the IPE local traders (both Local Members and Individual Participants) could meet commercial standards justifying access to an ECM. NYYMEX supports this conclusion by arguing that the lack of FSA registration for IPE local traders, combined with a lack of express qualifying and trading participation requirements, raises a question as to whether such traders could serve as effective “liquidity providers” on an ECM.

NYMEX also questions whether the petition is imbued with a full understanding of the meaning of “trading for one's own account” within the context of obtaining trading access to an ECM.

The NYMEX comments also respond to the Commission's inquiry whether any regulatory response to the petition should be tailored specifically to permit IPE members to trade solely on Intercontinental or should be more broadly designed to permit IPE members to trade on other ECMs as well. Although more generally opposing the grant of the petition, NYMEX, in response to this question, comments that it is unable to identify any factual circumstances that would be unique to Intercontinental's ECM. On this basis, NYMEX concludes there is no need to tailor any hypothetical relief to the specific factual circumstances of the Intercontinental ECM and, in this respect, questions the wisdom of “creating private definitions for public statutory categories.” In summary, although NYMEX argues against granting the petition, NYMEX suggests that in any grant of relief the Commission “may wish to consider allowing such IPE members to trade on other ECMs.”

As noted, Intercontinental submitted a comment letter dated April 28, 2004. That letter generally responds to the issues raised in the NYMEX letter of April 7, 2004. At the outset, Intercontinental notes that the IPE, as an RIE regulated by FSA, is subject to a panoply of FSA requirements, which, according to Intercontinental, are designed to protect the functioning of the market and the interests of users. 23

Intercontinental also comments that these FSA requirements on member access to an RIE should also be read in conjunction with the rules and requirements independently applied by IPE. 24 As a supplement to these rules and requirements, Intercontinental comments that IPE also applies a membership due diligence screening process in which the IPE inquiry seeks information on an applicant's personal history including, but not limited to, the applicant's experience and knowledge of derivatives trading, whether an individual applicant has been registered by another regulatory body, has ever been disciplined by another regulatory body, or been insolvent. Additionally, Intercontinental comments that, as part of the due diligence screening, IPE conducts an identification inquiry under anti-money laundering standards and reviews or confirms all information obtained with appropriate agencies.

With respect to IPE contracts traded on the electric platform, Intercontinental comments that IPE makes available two different training programs for new members before they can access the system. As a consequence of these requirements, Intercontinental maintains that the characterization by NYMEX that IPE electronic traders are “unschooled and unsophisticated,” or of a retail nature, is not accurate. On this basis, Intercontinental concludes that the IPE members should be viewed as eligible to access the over-the-counter contracts traded on Intercontinental's ECM.

Intercontinental's comment letter also notes that it is not seeking relief solely for its own ECM, but rather does not oppose broad ECM access for the IPE membership. Intercontinental also acknowledges that relief is being sought solely for “principal-to-principal” trading.

While not responding to any aspect of NYMEX's comment letter, Intercontinental did add several clarifications with respect to its relief request. For instance, Intercontinental remarks that its systems are adequate to enforce the requirement that IPE members eligible for relief must be located in the U.K., as it inquires into a participant's physical location by collecting information on a participant's principal business address. Intercontinental also comments that it conducts an anti-money laundering inquiry for privately-owned companies in which the participant must present the company's registered address, as well as collecting the address and telephone number for each user as part of its process for new market users.

Under the CEA, ECMs are commercial markets executing principal-to-principal transactions. In view of the unregulated nature of these markets, Congress intended that access should be confined to professional traders—either ECEs as defined in section 1a(11) or other traders that have an interest in the underlying commodity as part of their business operations, perform a market-making role, or otherwise provide a similar trading function that improves market liquidity.

As noted above the Commission has previously acted to expand the ECE definition to include floor brokers and floor traders registered with the Commission and acting in a proprietary capacity, since these persons operate as knowledgeable, experienced professional traders who historically have provided a trading function that improves market liquidity. 25 The Commission stated in the Federal Register notice accompanying that action that in order to qualify as an ECE under the Order, the “CFTC-registered floor broker or floor trader must be a member of a DCM or otherwise have trading privileges on a DCM * * * [and act] as a floor broker or floor trader, either on a DCM's open outcry market or [perform] an equivalent function on the DCM's electronic market.” In the Federal Register notice, the Commission also acknowledged, as professional traders providing market-making type activities, that the floor broker or floor trader “need not have any connection to or experience in the underlying physical commodity.” Finally, the Commission stated that the “floor broker or floor trader must either be an ECP or have its trades on the ECM guaranteed by a clearing member that is both a member of a CFTC-registered derivatives clearing organization and an ECP.”

Underlying the Commission's prior action was the notion that registration was a proxy for the aforementioned knowledge, experience, and professionalism, and for the provision of a market-making or similar trading function that improves market liquidity.

As outlined above in Section II.A, Intercontinental maintains that its petition seeks relief of a similar nature, and further represents that granting its request would constitute an appropriate extension of the Commission's prior action. Although NYMEX supported the Commission's prior action, NYMEX now opposes the Intercontinental petition for IPE traders. In contrast to Intercontinental's declaration, the comment letters submitted by NYMEX argue that the Intercontinental petition fails to satisfy standards established under the Commission's prior action to include CFTC-registered floor brokers and floor traders in the definition of an ECE.

The Commission believes that granting relief for IPE brokers would comply with the Commission's prior action to expand the ECE category to include CFTC-registered floor brokers and floor traders. IPE brokers, by virtue of having received FSA authorization as a prerequisite to engaging in the conduct of commodity brokerage on IPE, conform to that part of the standards enunciated in the Commission's prior action. The Commission also has entered into an information-sharing arrangement with the FSA.

With respect to IPE floor and electronic local traders, NYMEX correctly concludes that these traders are neither authorized nor approved by FSA, the U.K. regulator with jurisdiction over commodity futures exchanges and other instrumentalities operating in the U.K. financial services industry. Nonetheless, the Commission believes that it is appropriate to include these traders under the ECE category since, as identified above, IPE floor and electronic local traders do have to meet a schedule of criteria in order to establish eligibility as an IPE Local Member or Individual Participant. In order to demonstrate fitness, both IPE Local Members and Individual Participants must, among other things, successfully pass the Registered Trader examination that is administered by IPE. 26

As either an applicant or an IPE-approved trader, Local Members and Individual Participants must meet a schedule of fees that is essentially the same for both classes of membership. Each applicant is required to pay an application fee of 500 pounds. If accepted to membership, each applicant would then be required to pay an annual subscription fee of 350 pounds per seat or membership. Additionally, each applicant would be subject to an annual minimum activity charge of 1000 pounds, if the applicant failed to trade at least 4000 lots per year.

Other applicable criteria differ for each of these two trader classes, most notably with respect to evidencing an adequate level of experience and knowledge. Local Members are required to either purchase or lease a seat on IPE and to serve both a trainee and probationary period. While in trainee status, an applicant may only enter a trading pit as an observer. 27 In order to achieve probationary status, an applicant must pass the Registered Trader exam. During the probationary period, an applicant may execute transactions on the exchange, but only under the supervision of another IPE member. 28

After completion of the probationary period, the applicant's performance is subjected to peer review by other IPE members and the IPE Trading Committee. 29 Final acceptance or denial of membership is conditioned on confirmation of the IPE Trading Committee. Thus, the trainee and probationary periods required of Local Members appear to serve as a training period or apprenticeship preparatory to a new member receiving full floor trading privileges.

For Individual Participants, who only have trading privileges for the IPE electronic system, IPE has implemented other requirements that differ from those applicable to Local Members. Under IPE requirements, as in the case of Local Members, Individual Participants must also show fitness to be a member. However, as outlined above in Section II.C, in addition to successfully passing the Registered Trader Exam, applicants for Individual Participant membership must demonstrate substantial experience trading on a U.K. futures exchange, or otherwise satisfy the standards defining an Intermediate Customer under FSA Conduct of Business Rule 4.1.9R.

According to Intercontinental, electronic trader eligibility is limited to existing IPE-registered traders, to traders at other U.K. exchanges, to other individuals with substantial trading experience on U.K. futures exchanges, or to traders who have successfully passed the Registered Trader exam. Thus, according to Intercontinental, FSA-developed standards under COB Rule 4.1.9R, which define an intermediate customer, are used by IPE as a screening device to differentiate professional from retail experience among applicants.

As the above suggests, criteria set out under COB Rule 4.1.9R are intended for use in determining whether a client would have experience meeting or qualifying at the intermediate customer level. Thus COB Rule 4.1.9R instructs that, in determining a client's experience and knowledge, a firm should inquire about:

1. The client's knowledge, understanding, and awareness of risks in the applicable investments and markets,

2. The length of time the client has been active in these markets, the frequency of dealings, and the extent to which client relied on advice,

3. The size and nature of the transactions undertaken for the client, and

4. The client's financial standing, which may include an assessment of net worth and portfolio.

As a practice that is functionally parallel to that required of financial firms under COB Rule 4.1.9R, Intercontinental has represented that IPE will confine eligibility for admission as an electronic trader to applicants with:

1. Sufficient knowledge and understanding of market and risks,

2. Who were active on such markets for a reasonable length of time,

3. Who have traded in appropriate size and quantity, and

4. Who have appropriate financial standing.

In this respect, IPE confirms that it will apply the criteria found in Rule 4.1.9R applicable to assessing experience and knowledge of an expert private customer as part of an independent determination made by IPE management. Moreover, IPE represents that the prior status an applicant may have attained as a customer of a financial services firm would not be determinative of eligibility, but that IPE would undertake an independent assessment of the applicant's experience and knowledge under the standards of COB Rule 4.1.9R. 30

As a general matter, IPE also maintains that as an RIE it is organized as a wholesale market and is not open to retail membership. In this regard, IPE points out that FSA rules and standards found in the Recognized Investment Exchange and Clearing House sourcebook (“REC”) impose requirements on types of applicants eligible for membership. Among other things, REC Rule 2.7.3 states that FSA may conduct assessments of whether access to a UK recognized body's facilities is based on criteria designed to protect the orderly functioning of the market and the interests of investors. Further, Rule 2.7.3 states that FSA, in conducting any such assessments, may consider: (a) Whether the RIE limits access as a member to persons over whom it can with reasonable certainty enforce its rules, (b) who have sufficient technical competence to use the market's facilities, (c) whom it is appropriate to admit to membership having regard for the size and sophistication of users of its facilities and the nature of business thereon, and (d) where appropriate, the adequacy of financial resources in relation to a member's exposure to the UK recognized body or central counterparty. 31

As noted, IPE local traders need not be authorized or approved by FSA as a pre-condition in obtaining trading privileges on IPE. The U.K. approach therefore differs somewhat from that applied under U.S. regulation, where Commission requirements mandate registration with a government body for both floor brokers and floor traders. However, even though qualifying determinations for local traders are reserved to IPE, those procedures are subject to FSA supervision. Thus, notwithstanding the formalistic differences in the treatment of local traders in the U.S. and U.K. regulatory systems, the Commission believes that the U.K. regulatory structure facilitates and enforces a level of regulation for the IPE local traders that meets applicable standards of professionalism established under the Commission's prior action expanding the ECE category to include CFTC-registered floor brokers and floor traders. 32

After consideration of the Intercontinental petition, and the additional material submitted by Intercontinental to accompany the petition, and the comment letters submitted in response to the Federal Register notice, the Commission has determined, consistent with the Intercontinental petition, that it is appropriate to issue an order, pursuant to Section 1a(11)(c) of the Act, that includes certain IPE floor and electronic brokers and traders, subject to certain conditions, within the definition of an ECE for eligibility to trade on an ECM. 33 As in the prior action to expand the ECE definition to include CFTC-registered floor brokers and floor traders, either in open outcry or electronic markets, the Commission believes that expanding the definition to include IPE floor and electronic brokers and traders is consistent with the purposes of the CFMA. 34 Moreover, and again as in the prior action, the Commission believes that inclusion of IPE floor and electronic brokers and traders in the definition of an ECE could potentially increase competition and efficiency, and reduce liquidity risk, on ECMs.

As noted above, underlying the Commission's prior action was the notion that registration serves as a proxy for the aforementioned knowledge, experience and professionalism, and for the provision of a market-making or similar trading function that improves market liquidity. Commission action taken here makes a similar finding for IPE floor and electronic brokers and traders with respect to their knowledge, experience and professionalism, and their ability to provide market-making or similar trading functions that improve market liquidity.

The Commission also notes that IPE registration of electronic local traders is based on eligibility pursuant to the Intermediate Customer standards under FSA COB 4.1.9R. The Commission considers the inclusion of this process in IPE registration as a reasonable proxy for an electronic local trader's knowledge, experience, professionalism, and ability to provide a market-making or similar trading function that improves market liquidity. Moreover, the Commission believes that the IPE has the experience and ability to apply the standards in an efficient and prudent manner. The Commission points out that these determinations are based on materials provided by, and/or representations made by, IPE and FSA and, as such, are particular to IPE. If another market or governmental regulator petitioned the Commission for a similar expansion of the ECE definition, an analogous showing to the Commission would be necessary.

The Commission also notes that it has previously expanded the ECE definition for purposes of trading on a DTEF. 35 That action incorporated within the ECE definition registered floor brokers and floor traders, whose trading obligations are guaranteed by a registered FCM, when trading for their own accounts on a DTEF.

In order to qualify as an ECE under the Commission's order, an IPE floor or electronic broker or trader must be a member of IPE or otherwise have trading privileges on IPE and be located in the U.K. Pursuant to those requirements, the qualifying IPE floor or electronic broker or trader also must be authorized by FSA or registered with IPE. The IPE floor or electronic broker or trader must have as a part of its business the business of acting as a commodity broker or local trader, either on IPE's open outcry or electronic market, but need not have any connection to or experience in the underlying physical commodity. The Commission believes that the trading expertise of IPE floor or electronic brokers or traders would be applicable to trading in any commodity product traded on an ECM. Among other things, the ability of an IPE floor or electronic broker or trader to interpret market momentum, and facilitate the adjustment of market prices to new information, is more a function of trading expertise than of experience in the underlying physical commodity.

A qualifying IPE floor or electronic broker or trader must be either an ECP or have its trades on the ECM guaranteed by a clearing member that is both a member of an FSA-recognized derivatives clearing organization and an ECP. The Commission believes that requiring either the IPE floor or electronic broker or trader, or the guarantor thereof, to be an ECP provides sufficient financial backing for the IPE floor or electronic broker or trader and mitigates any credit and collection risk that might otherwise arise. The Commission notes that the guarantor of an IPE floor or electronic broker or trader would be placing its own money at risk, and expects that such guarantor would carefully consider the risk involved in the provision of the guarantee for that particular broker or trader.

Section 15 of the Act, as amended by section 119 of the CFMA, requires the Commission to consider the costs and benefits of its action before issuing a new order under the Act. By its terms, section 15 does not require the Commission to quantify the costs and benefits of its action or to determine whether the benefits of the action outweigh the costs. Rather, section 15 simply requires the Commission to “consider the costs and benefits” of its order.

Section 15(a) further specifies that the costs and benefits of the proposed order shall be evaluated in light of five broad areas of market and public concern: (1) Protection of market participants and the public; (2) efficiency competitiveness and financial integrity of futures markets; (3) price discovery; (4) sound risk management practices; and (5) other public interest considerations. The Commission may, in its discretion, give greater weight to any one of the five enumerated areas of concern and may, in its discretion, determine that, notwithstanding its costs, a particular order is necessary or appropriate to protect the public interest or to effectuate any of the provisions or to accomplish any of the purposes of the Act.

The subject order is intended to reduce regulatory barriers to permit certain IPE floor or electronic brokers or traders, when acting in a proprietary capacity, to enter into transactions in exempt commodities on ECMs pursuant to section 2(h)(3) of the Act if such entities are either ECPs or have obtained a financial guarantee for such transactions from a clearing member that is both a member of a FSA-registered derivatives clearing organization and an ECP. The Commission has considered the costs and benefits of the order in light of the specific provisions of section 15(a) of the Act.

The order would deem certain professional IPE floor or electronic brokers or traders meeting the required conditions who are ECPs, or who have guarantees from clearing members that are members of FSA-registered derivatives clearing organizations and are ECPs, to be ECEs under section 1a(11)(c) and thus permit them to enter into proprietary transactions in exempt commodities on ECMs. Under the Act, ECEs are sophisticated investors who have the financial wherewithal or trading expertise to participate in these markets. Accordingly, there should be no effect on the Commission's ability to protect market participants and the public.

The order is expected to benefit efficiency and competition by, among other things, providing essential trading expertise to the market that enhances price discovery through both the speed and efficiency of market adjustment to new fundamentals and by generally increasing the pool of potential counterparties for participants trading on exempt commercial markets.

The order should have no effect, from the standpoint of imposing costs or creating benefits, on the financial integrity of the futures and options markets. The order should enhance the price discovery function of such markets.

The order should have no effect, from the standpoint of imposing costs, on the risk management practices of the futures and options industry. Where an individual or entity is qualified as an ECP, the individual or entity has been deemed under the Act to be sufficiently responsible to execute trades in certain excluded or exempt commodity transactions, and no further mitigation of credit risk is necessary. Moreover, where an individual or entity does not qualify as an ECP, the order requires that a clearing member of an FSA-recognized derivatives clearing organization that is itself an ECP guarantee the trades in order to mitigate the credit and collection risk.

The order is consistent with one of the purposes of the Act as articulated in section 3 in that it would promote responsible innovation and fair competition among boards of trade, other markets, and market participants.

Upon due consideration, and pursuant to its authority under section 1a(11)(C) of the Act, the Commission hereby determines that certain professional International Petroleum Exchange (“IPE”) floor or electronic brokers or local traders, who are authorized by the Financial Services Authority (“FSA”) or registered with the IPE, when acting in a proprietary capacity, are appropriate persons as defined in section 1a(11)(C) and, thus, are deemed to be eligible commercial entities and may enter into contracts, agreements or transactions in an exempt commodity on an exempt commercial market under the following conditions:

1. The contracts, agreements, or transactions must be executed on an exempt commercial market that meets the requirements of section 2(h)(3)-(5) of the Act.

2. The IPE floor or electronic broker, denominated as either a Floor Member or General Participant pursuant to IPE membership rules, must be a member of IPE or otherwise have trading privileges on IPE, be located in the U.K., and be subject to the rules of IPE.

3. The IPE local trader, denominated as a Local Member or Individual Participant pursuant to IPE membership rules, must be a member of IPE or otherwise have trading privileges on IPE, be located in the U.K., and be subject to the rules of IPE.

4. The IPE Floor Member or General Participant must be authorized and regulated by the FSA.

5. The IPE Local Member or Individual Participant must be registered with the IPE.

6. The IPE Floor Member, General Participant, Local Member, or Individual Participant must have as a part of its business the business of acting as a professional commodity broker or trader on either the IPE open outcry or electronic markets.

7. The IPE Individual Participant must meet and satisfy the current qualifying standards of an Intermediate Customer pursuant to FSA Conduct of Business (“COB”) Rule 4.1.9R. IPE must notify the Commission of any changes to the standards included in FSA COB Rule 4.1.9R.

8. The IPE Floor Member, General Participant, Local Member, or Individual Participant must be either an eligible contract participant, as that term is defined in section 1a(12) of the Act, or have its trades on the exempt commercial market guaranteed by a clearing member that is a member of an FSA-recognized derivatives clearing organization and is an eligible contract participant.

Price, performance, and/or implementation of socio-economic policies may be affected by make-or-buy decisions under certain Government prime contracts. Accordingly, FAR 15.407-2, Make-or-Buy Programs (i) Sets forth circumstances under which a Government contractor must submit for approval by the contracting officer a make-or-buy program, i.e., a written plan identifying major items to be produced or work efforts to be performed in the prime contractor's facilities and those to be subcontracted;

(ii) Provides guidance to contracting officers concerning the review and approval of the make-or-buy programs; and

(iii) Prescribes the contract clause at FAR 52.215-9, Changes or Additions to Make-or-Buy Programs, which specifies the circumstances under which the contractor is required to submit for the contracting officer's advance approval a notification and justification of any proposed change in the approved make-or-buy program.

The information is used to assure the lowest overall cost to the Government for required supplies and services.

Respondents: 150.

Responses Per Respondent: 3.

Total Responses: 450.

Hours Per Response: 8.

Total Burden Hours: 3,600.

Obtaining Copies of Proposals: Requesters may obtain a copy of the information collection documents from the General Services Administration, FAR Secretariat (VR), Room 4035, Washington, DC 20405, telephone (202) 501-4755. Please cite OMB Control No. 9000-0078, Make-or-Buy Program, in all correspondence.

This information collection complies with Executive Order 13126, Prohibition on Acquisition of Products Produced by Forced or Indentured Child Labor, signed by the President on June 12, 1999. Executive Order 13126 requires that this prohibition be enforced within the federal acquisition system by means of: (1) A provision that requires the contractor to certify to the contracting officer that the contractor or, in the case of an incorporated contractor, a responsible official of the contractor has made a good faith effort to determine whether forced or indentured child labor was used to mine, produce, or manufacture any product furnished under the contract and that, on the basis of those efforts, the contractor is unaware of any such use of child labor; and (2) A provision that obligates the contractor to cooperate fully in providing reasonable access to the contractor's records, documents, persons, or premises if reasonably requested by authorized officials of the contracting agency, the Department of the Treasury, or the Department of Justice, for the purpose of determining whether forced or indentured child labor was used to mine, produce, or manufacture any product furnished under the contract.

The information collection requirements of the Executive Order are evidenced via the certification requirements delineated at FAR 22.1505, 52.212-3, 52.222-18, and 52.222-19.

To eliminate some of the administrative burden on offerors who must submit the same information to various contracting offices, the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (Councils) decided to amend the Federal Acquisition Regulation (FAR) to require offerors to submit representations and certifications electronically via the Business Partner Network (BPN), unless certain exceptions apply. Online Representations and Certifications Application (ORCA) is the specific application on the BPN to replace the paper based Representations and Certifications (Reps and Certs) process. The change to the FAR is being accomplished by FAR Case 2002-024. The clearance associated with this case referenced this OMB Control No. 9000-0155 and reduced the hours of burden by 35%—attributable to mandated use of ORCA. This reduction is already reflected in the figures below.

Respondents: 500.

Responses Per Respondent: 1.

Hours Per Response: 0.325.

Total Burden Hours: 162.

Obtaining Copies of Proposals: Requesters may obtain a copy of the information collection documents from the General Services Administration, Regulatory Secretariat (VR), 1800 F Street, NW, Room 4035, Washington, DC 20405, telephone (202) 501-4755. Please cite OMB Control No. 9000-0155, Prohibition on Acquisition of Products Produced by Forced or Indentured Child Labor, in all correspondence.

Standard Form 1413, Statement and Acknowledgment, is used by all Executive Agencies, including the Department of Defense, to obtain a statement from contractors that the proper clauses have been included in subcontracts. The form includes a signed contractor acknowledgment of the inclusion of those clause in the subcontract.

Respondents: 31,500.

Responses Per Respondent: 2.

Total Responses: 63,000

Hours Per Response: .05.

Total Burden Hours: 3,150.

Obtaining Copies of Proposals: Requesters may obtain a copy of the information collection documents from the General Services Administration, FAR Secretariat (VR), 1800 F Street, NW, Room 4035, Washington, DC 20405, telephone (202) 501-4755. Please cite OMB Control No. 9000-0014, Statement and Acknowledgment, Standard Form 1413, in all correspondence.

Agencies are required to report under 41 U.S.C. 252(d) and 10 U.S.C. 2305(d) suspected violations of the antitrust laws (e.g., collusive bidding, identical bids, uniform estimating systems, etc.) to the Attorney General. As a first step in assuring that Government contracts are not awarded to firms violating such laws, offerors on Government contracts must complete the certificate of independent price determination. An offer will not be considered for award where the certificate has been deleted or modified. Deletions or modifications of the certificate and suspected false certificates are reported to the Attorney General.

Respondents: 64,250.

Responses Per Respondent: 20.

Total Responses : 1,285,000.

Hours Per Response: .0065.

Total Burden hours: 8,352.

Obtaining Copies of Proposals: Requesters may obtain a copy of the information collection documents from the General Services Administration, FAR Secretariat (VR), Room 4035, 1800 F Street, Washington, DC 20405, telephone (202) 501-4755. Please cite OMB Control No. 9000-0018, Certification of Independent Price Determination and Parent Company and Identifying Data, in all correspondence.

Section 3506 of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35) requires that the Office of Management and Budget (OMB) provide interested Federal agencies and the public an early opportunity to comment on information collection requests. OMB may amend or waive the requirement for public consultation to the extent that public participation in the approval process would defeat the purpose of the information collection, violate State or Federal law, or substantially interfere with any agency's ability to perform its statutory obligations. The Director, Regulatory Information Management Services, Office of the Chief Information Officer, publishes that notice containing proposed information collection requests prior to submission of these requests to OMB. Each proposed information collection, grouped by office, contains the following: (1) Type of review requested, e.g., new, revision, extension, existing or reinstatement; (2) title; (3) summary of the collection; (4) description of the need for, and proposed use of, the information; (5) respondents and frequency of collection; and (6) reporting and/or recordkeeping burden. OMB invites public comment.

Type of Review: Extension.

Title: Guaranty Agency Financial Report.

Frequency: Monthly, annually.

Affected Public: State, local, or tribal gov't, SEAs or LEAs; businesses or other for-profit.

Reporting and Recordkeeping Hour Burden:

 Responses: 612.

 Burden Hours: 33,660.

Abstract: The Guaranty Agency Financial Report is used to request payments from and make payments to the Department of Education under the Federal Family Education Loan (FFEL) program authorized by Title IV, Part B of the Higher Education Act (HEA) of 1965, as amended. The report is also used to monitor the agency's financial activities, including activities concerning its Federal fund, operating fund and the agency's restricted account.

Requests for copies of the submission for OMB review; comment request may be accessed from http://edicsweb.ed.gov, by selecting the “Browse Pending Collections” link and by clicking on link number 2641. When you access the information collection, click on “Download Attachments” to view. Written requests for information should be addressed to U.S. Department of Education, 400 Maryland Avenue, SW., Potomac Center, 9th Floor, Washington, DC 20202-4700. Requests may also be electronically mailed to the Internet address OCIO_RIMG@ed.gov or faxed to 202-245-6621. Please specify the complete title of the information collection when making your request.

Comments regarding burden and/or the collection activity requirements should be directed to Sheila Carey at her e-mail address Sheila.Carey@ed.gov. Individuals who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.

(A) Background and Discussion

Section 209(a) of the Clean Air Act, as amended (“Act”), 42 U.S.C. 7543(a), provides:

Section 209(b)(1) of the Act requires the Administrator, after notice and opportunity for public hearing, to waive application of the prohibitions of section 209(a) for any state that has adopted standards (other than crankcase emission standards) for the control of emissions from new motor vehicles or new motor vehicle engines prior to March 30, 1966, if the state determines that the state standards will be, in the aggregate, at least as protective of public health and welfare as applicable federal standards. California is the only state that is qualified to seek and receive a waiver under section 209(b). The Administrator must grant a waiver unless he finds that (A) the determination of the state is arbitrary and capricious, (B) the state does not need the state standards to meet compelling and extraordinary conditions, or (C ) the state standards and accompanying enforcement procedures are not consistent with section 202(a) of the Act.

CARB's July 16, 2004, letter to the Administrator notified EPA that it had adopted amendments to its heavy-duty diesel vehicle and engine program. These amendments are to title 13, California Code of Regulations (CCR), section 1958.8. The specific regulatory text and the incorporated document covered by CARB's rulemaking are: section 1956.8, Title 13, CCR as shown in attachment 2 to CARB's July 16, 2004 letter; and the amendments to the related test procedures incorporated in section 1956.8(b), “California Exhaust Emission Standards and Test Procedures for 1985 and Subsequent Model Heavy-Duty Diesel Engines and Vehicles,” also shown in attachment 2.

Please provide comment as to whether (a) California's determination that its amendments as referenced in its July 16, 2004, request letter, are at least as protective of public health and welfare as applicable federal standards is arbitrary and capricious, (b) California needs separate standards to meet compelling and extraordinary conditions, and (c) California's standards and accompanying enforcement procedures are consistent with section 202(a) of the Clean Air Act.

In recognition that public hearings are designed to give interested parties an opportunity to participate in this proceeding, there are no adverse parties as such. Statements by participants will not be subject to cross-examination by other participants without special approval by the presiding officer. The presiding officer is authorized to strike from the record statements that he or she deems irrelevant or repetitious and to impose reasonable time limits on the duration of the statement of any participant.

If hearing(s) are held, the Agency will make a verbatim record of the proceedings. Interested parties may arrange with the reporter at the hearing(s) to obtain a copy of the transcript at their own expense. Regardless of whether public hearing(s) are held, EPA will keep the record open until January 24, 2005. Upon expiration of the comment period, the Administrator will render a decision on CARB's request based on the record of the public hearing(s), if any, relevant written submissions, and other information that he deems pertinent. All information will be available for inspection at EPA Air Docket. (OAR-2004-0132).

Persons with comments containing proprietary information must distinguish such information from other comments to the greatest possible extent and label it as “Confidential Business Information” (CBI). If a person making comments wants EPA to base its decision in part on a submission labeled CBI, then a nonconfidential version of the document that summarizes the key data or information should be submitted for the public docket. To ensure that proprietary information is not inadvertently placed in the docket, submissions containing such information should be sent directly to the contact person listed above and not to the public docket. Information covered by a claim of confidentiality will be disclosed by EPA only to the extent allowed and by the procedures set forth in 40 CFR part 2. If no claim of confidentiality accompanies the submission when EPA receives it, EPA will make it available to the public without further notice to the person making comments.

This action is directed to the public in general. This action may, however, be of interest to those persons who are or may be required to conduct testing of chemical substances under TSCA. Since other entities may also be interested, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT .

1. Docket. EPA has established an official public docket for this action under docket identification (ID) number OPPT-2003-0004. The official public docket consists of the documents specifically referenced in this action, any public comments received, and other information related to this action. Although a part of the official docket, the public docket does not include CBI or other information whose disclosure is restricted by statute. The official public docket is the collection of materials that is available for public viewing at the EPA Docket Center, Rm. B102-Reading Room, EPA West, 1301 Constitution Ave., NW., Washington, DC. The EPA Docket Center is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The EPA Docket Center Reading Room telephone number is (202) 566-1744 and the telephone number for the OPPT Docket, which is located in EPA Docket Center, is (202) 566-0280.

2. Electronic access . You may access this Federal Register document electronically through the EPA Internet under the “ Federal Register ” listings at http://www.epa.gov/fedrgstr/ .

An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at http://www.epa.gov/edocket/ to submit or view public comments, access the index listing of the contents of the official public docket, and to access those documents in the public docket that are available electronically. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility identified in Unit I.B.1. Once in the system, select “search,” then key in the appropriate docket ID number.

Under Contract Number EP-W-04-046, SAIC of 11251 Roger Bacon Drive, Reston, VA, will assist EPA by providing expert witness support for a civil administrative hearing, administer the Core TSCA Enforcement Center (CTEC) automated tracking system for TSCA CBI, and perform enforcement inspections. SAIC will also assist in the review and/or collection of information from businesses and could potentially access documents subjects to TSCA CBI claim.

In accordance with 40 CFR 2.306(j), EPA has determined that under Contract Number EP-W-04-046, SAIC will require access to CBI submitted to EPA under sections 4, 5, 6, 8, 12, and 13 of TSCA, to perform successfully the duties specified under the contract.

SAIC personnel will be given information submitted to EPA under sections 4, 5, 6, 8, 12, and 13 of TSCA. Some of the information may be claimed or determined to be CBI.

EPA is issuing this notice to inform all submitters of information under sections 4, 5, 6, 8, 12, and 13 of TSCA, that the Agency may provide SAIC access to these CBI materials on a need-to-know basis only. All access to TSCA CBI under this contract will take place at EPA Headquarters only.

Clearance for access to TSCA CBI under Contract Number EP-W-04-046 may continue until September 30, 2009. Access will commence no sooner than November 22, 2004.

SAIC personnel have signed nondisclosure agreements and will be briefed on appropriate security procedures before they are permitted access to TSCA CBI.

On February 3, 2004 (69 FR 5147), EPA published a notice of availability for public comment on the “Draft Model CERCLA Application/Information Request for Service Station Dealers.” On July 20, 2004 (69 FR 43412), EPA published a notice of availability for public comment on a revised draft model, entitled “Draft Model Application/Information Request for CERCLA Service Station Dealer Exemption.” After careful consideration of the comments received, EPA revised and finalized the model application/ information request. The final model is available on EPA's Web site at http://www.epa.gov/ compliance/resources/policies/cleanup/superfund/ssde-mod-appinfo.pdf.

OMB Control Number: 3060-0788.

Title: DTV Showings/Interference Agreements.

Form Number: FCC Form 301 and FCC Form 340.

Type of Review: Revision of a currently approved collection.

Respondents: Business or other for-profit entities; and Not-for-profit institutions.

Number of Respondents: 300.

Estimated Time per Response: 5 hours.

Frequency of Response: On occasion reporting requirement; and Third party disclosure.

Total Annual Burden: 1,500 hours.

Total Annual Cost: $2,400,000.

Privacy Act Impact Assessment: No impact(s).

Needs and Uses: Section III-D of the FCC Form 301 and Section VII of the FCC Form 340 begin with a “Certification Checklist.” This checklist contains a series of questions by which applicants may certify compliance with key processing requirements. The first certification requires conformance with the DTV Table of Allotments. The Commission allows flexibility for DTV facilities to be constructed at locations within five kilometers of the reference allotment sites without consideration of additional interference to analog or DTV service, provided the DTV service does not exceed the allotment reference height above average terrain or effective radiated power. In order for the Commission to process applications that cannot certify affirmatively, 47 CFR Section 73.623(c) requires applicants to submit a technical showing to establish that their proposed facilities will not result in additional interference to TV broadcast and DTV operations. Additionally, the Commission permits broadcasters to agree to proposed DTV facilities that do not conform to the initial allotment parameters, even though they might be affected by potential new interference. The Commission will consider granting applications on the basis of interference agreements if it finds that such grants will serve the public interest. These agreements must be signed by all parties to the agreement. In addition, the Commission needs the following information to enable such public interest determinations: A list of parties predicted to receive additional interference from the proposed facility, a showing as to why a grant based on the agreements would serve the public interest, and technical studies depicting the additional interference.

In 2001, the Commission removed from this collection all references to industry frequency coordination committees. These committees did not evolve. Respondents have been using consulting engineers and attorneys to prepare the technical showings and interference agreements.

OMB Control Number: 3060-0685.

Title: Annual Updating of Maximum Permitted Rates for Regulated Cable Services, FCC Form 1240.

Form Number: FCC 1240.

Type of Review: Revision of currently approved collection.

Respondents: Business or other for-profit entities; and State, local, or tribal government.

Number of Respondents: 3,000.

Estimated Time per Response: 10 hour (avg.).

Frequency of Response: Annual reporting requirement.

Total Annual Burden: 30,000 hours.

Total Annual Cost: $562,500.

Privacy Impact Assessment: No impact(s).

Needs and Uses: The FCC Form 1240 is filed with the local franchising authorities (“LFAs”) by cable operators seeking to adjust maximum permitted rates to reflect changes in external costs. The Commission authored the Form 1240 to enable local franchising authorities to adjudicate permitted rates for regulated cable rates, services, and equipment; for the addition and/or deletion of channels; and for allowance for pass through of external costs due to inflation.

This is a summary of the Commission's Notice of Inquiry in IB Docket No. 04-398, FCC 04-247, which was adopted on October 14, 2004. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Reference Center (Room CY-A257), 445 12th Street, SW., Washington, DC 20554. The document may also be downloaded from the Commission's Web site at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-247A1.pdf. The complete text may also be purchased from the Commission's copy contractor, Best Copy and Printing, Inc., in person at 445 12th Street, SW., Room CY-B402, Washington, DC 20554, via telephone at (202) 488-5300, via facsimile at (202) 488-5563, or via e-mail at FCC@BCPIWEB.COM.

On October 14, 2004, the Commission adopted a Notice of Inquiry on the Effect of Foreign Mobile Termination Rates on U.S. Customers. By this Notice of Inquiry, the Commission seeks to develop a record on foreign mobile termination rates that will enable the Commission to assess properly the effects of foreign mobile termination rates on U.S. customers and competition in the U.S.-international services market.

In the Notice of Inquiry, the Commission seeks comment on foreign mobile termination rate payment flows and the relevant regulatory regimes. The Commission seeks input, analyses, and comments on the concerns raised by parties in the ISP Reform Order, FCC 04-53, 69 FR 23151, April 28, 2004, and on actions taken by foreign national regulatory authorities to address mobile termination rates within their respective jurisdictions. In addition, the Commission asks for factual information and data on foreign mobile termination rates. Finally, the Commission seeks comment on the appropriate framework by which the Commission can analyze whether foreign mobile termination rates are unreasonably high.

The Commission encourages all interested parties to respond to the questions and requests set forth in the Notice of Inquiry.

Pursuant to the authority contained in 47 U.S.C. Sections 151, 4(i), 201, 202, 203, 204, 205, 211, 218, 303(r), 403 this Notice of Inquiry is adopted.

Under the PRA (44 U.S.C. 3501-3520), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency request or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires Federal agencies to provide a 60-day notice in the Federal Register concerning each proposed collection of information, including each proposed extension of an existing collection of information, before submitting the collection to OMB for approval. To comply with this requirement, AoA is publishing notice of the proposed collection of information set forth in this document. With respect to the following collection of information, AoA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of AoA's functions, including whether the information will have practical utility; (2) the accuracy of AoA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques when appropriate, and other forms of information technology. AoA estimates the burden of this collection of information as follows:

Frequency: Annually.

Respondents: Medicare beneficiaries after SMP education/training on fraud prevention; administered by staff or senior volunteers in 57 SMP projects nationwide.

Estimated number of responses: 21,000.

Total Estimated Burden Hours: 2,300.

Section 4314(c) (1) through (5) of Title 5, U.S.C., requires each agency to establish, in accordance with regulations prescribed by the Office of Personnel Management, one or more SES performance review boards. The board reviews and evaluates the initial appraisal of a senior executive's performance by the supervisor and considers recommendations to the appointing authority regarding the performance of the senior executive.

The following have been designated as regular members of the Senior Executive Service (SES) Executive Review Board/SES Performance Review Board for IHS: Phyllis Eddy, Chair; Elaine Perry, Deputy Director, Office of the Administrator, Substance Abuse and Mental Health Services Administration; Robert G. McSwain, Acting Deputy Director, Management Operations; Gary Hartz, Acting Deputy Director, IHS; Chris Mandregan, Jr., Director, Alaska Area IHS; Doni Wilder, Director, Portland Area IHS; John Hubbard, Director, Navajo Area IHS.

Prior to March 1, 2003, FEMA was an independent agency within the Federal Government. While operating as an independent agency, FEMA published notices concerning its systems of records. The system at issue in this notice was last published on October 9, 2001. In compliance with the requirements of the Privacy Act of 1974, as amended, 5 U.S.C. 552a, FEMA gives notice that it intends to revise the routines uses and to add several new ones to its system of records entitled, FEMA/REG-2, Disaster Recovery Assistance Files. FEMA has amended the language in routine use (a) to allow information sharing with voluntary agencies actively working in the open disaster. FEMA also intends to add two new routine uses that allow for information sharing with other Federal and State agencies to enhance FEMA's ability to provide oversight and coordination of State activities and to ensure that the State performs and adheres to FEMA regulations and policy guidance. In addition, because FEMA became a part of DHS on March 1, 2003, FEMA is incorporating appropriate DHS routine uses as part of this system of records.

FEMA altered its system of records and provided a report as required by 5 U.S.C. 552a(r). This change is to amend the language of routine use (a). This amendment will not change the type or amount of information collected from individuals who apply for disaster assistance. Finally, this notice will make the public aware of routine management and oversight information sharing between FEMA and other Federal agencies, State and local governments, and contractors providing services in support of the Individual Assistance program. Routine uses (d), (e), (f), and (g) allow us to disclose information from this system of records to Federal, State, and local governments in the course of providing disaster assistance and in creating and implementing emergency evacuation plans. In addition, to reduce the burden on the public applying for disaster assistance, FEMA is now making the registration process available by an additional means—electronically via the Internet. In addition to filling out paper applications or calling in and applying over the telephone, individuals who wish to apply for disaster assistance can now also do so over the Internet.

Accordingly, FEMA amends the Disaster Recovery Assistance Files of the FEMA Privacy Act system of records to read as follows:

On September 24, 2004, TSA published in the Federal Register three notices related to TSA's plan to issue a final order to aircraft operators in order to obtain PNRs for testing of a new domestic passenger prescreening program known as Secure Flight (69 FR 57342, 57345, and 57352). This Federal Register notice that TSA is publishing today responds to public comments received in response to the notices published on September 24, 2004, and provides public notice of the final order that TSA is issuing for purposes of testing the Secure Flight program.

The Secure Flight program is an effort to move the existing passenger prescreening process into the Federal Government in order to make the process more effective, consistent, and efficient for the traveling public. By administering this screening process within the Federal Government, the Secure Flight program will allow for better protection of government watchlist information that currently is provided to aircraft operators.

Secure Flight will involve the comparison of information in PNRs from domestic flights to names in the Terrorist Screening Database (TSDB) maintained by the Terrorist Screening Center (TSC), including the expanded TSA No-Fly and Selectee Lists, in order to identify individuals known or reasonably suspected to be engaged in terrorist activity. TSA anticipates that it will also apply, within the Secure Flight system, a streamlined version of the existing passenger prescreening process, known as the Computer Assisted Passenger Prescreening System (CAPPS), which evaluates information in PNRs that passengers otherwise provide to aircraft operators in the normal course of business.

Simple comparisons of PNR information against records maintained in the TSDB will not permit TSA to identify information provided by passengers that is incorrect or inaccurate, potentially rendering the comparisons less effective. Therefore, on a very limited basis, in addition to testing TSA's ability to compare passenger information with data maintained by TSC, TSA will separately test the use of commercial data to determine if use of such data is effective in identifying passenger information that is incorrect or inaccurate and reducing the number of false positive matches of passenger information against TSDB records. This test will involve commercial data aggregators whose procedures will be governed by strict privacy and data security protections. TSA will not receive the commercially available data that would be used by commercial data aggregators. TSA will use this test of commercial data to determine whether such use: (1) Could identify when passengers' information is inaccurate or incorrect and/or assist with the resolution of false positive matches; (2) would result in inappropriate differences in treatment of any protected category of persons; and (3) could be governed by data security safeguards and privacy protections that are sufficiently robust to ensure that commercial entities or other unauthorized entities do not gain access to passengers' personal information and to ensure that the government does not gain inappropriate access to commercial information about individuals. TSA will defer any decision of whether commercial data will be used in its prescreening programs, such as Secure Flight, until a thorough assessment of test results is completed. If TSA decides to use commercial data for Secure Flight, it will not do so until the agency publishes a new System of Records Notice announcing how commercial data will be used and individuals' privacy will be protected.

TSA's efforts to develop and test the Secure Flight program are fully consistent with the recommendation in the final report of the National Commission on Terrorist Attacks Upon the United States (9/11 Commission), which states at page 392:

The expansion of these watchlists to include information not previously included for security reasons will be possible as integration and consolidation of the information related to individuals known or suspected to be engaged in terrorist activity maintained by TSC is completed and the U.S. Government assumes the responsibility for administering the watchlist comparisons. Secure Flight will automate the vast majority of watchlist comparisons, will allow TSA to apply more consistent procedures where automated resolution of potential matches is not possible, and will allow for more consistent response procedures at airports for those passengers identified as potential matches.

Secure Flight represents a significant step in securing domestic air travel and safeguarding terrorism-related national security information, namely, the watchlists. It will dramatically improve consistency and effectiveness of comparisons of passenger information with data now maintained by TSC and will reduce the long-term costs to air carriers and passengers associated with maintaining the present system, which is operated individually by each aircraft operator that flies in the United States.

In order to test the feasibility of the Secure Flight program, TSA must obtain a sample of passenger information for domestic flights. In preparation for obtaining this information for testing purposes, on September 24, 2004, TSA published three public notices in the Federal Register . First, TSA published a system of records notice in accordance with the Privacy Act of 1974 (5 U.S.C. 552a), including a list of the proposed routine uses of information in the system of records. (69 FR 57345). The system of records notice establishes a new system entitled “Secure Flight Test Records” (hereafter referred to as DHS/TSA 017), which will govern the collection, maintenance, use, and disclosure of PNRs and other information obtained by TSA for purposes of testing the Secure Flight program. TSA requested public comment on the routine uses for DHS/TSA 017 during a 30-day comment period ending on October 25, 2004.

Second, TSA published in the Federal Register a notice that TSA had submitted to the Office of Management and Budget in accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501, et seq. ) a request for emergency processing of OMB's review and approval for TSA to collect PNRs from aircraft operators to test the Secure Flight program (PRA notice). (69 FR 57342). That notice included the text of a proposed order to certain aircraft operators directing them to provide a limited set of historical PNRs to TSA that cover commercial scheduled domestic flights. Specifically, the proposed order covered PNRs with domestic flight segments flown during the month of June 2004 and excluded those PNRs with flight segments that occurred after June 30, 2004. The purpose of this limitation was to ensure that during the test phase, TSA does not obtain any information about future travel plans of passengers on domestic flights. The order also proposed to exclude PNR flight segments to or from the U.S. Although not required to do so, TSA requested public comment on the proposed order during a 30-day comment period ending on October 25, 2004. OMB subsequently has approved the information collection through March 31, 2005, and assigned OMB control number 1652-0025.

Third, TSA published in the Federal Register a Privacy Impact Assessment for the test phase of the Secure Flight program, which TSA prepared in accordance with the E-Government Act of 2002. (69 FR 57352).

TSA received approximately 500 public comments on the Privacy Act system of records notice for DHS/TSA 017. Identical versions of most of those comments also were sent to OMB in response to TSA's PRA notice. TSA has reviewed and considered the issues raised by the public comments submitted to TSA and OMB. This notice addresses those issues and describes changes made to TSA's proposed order to aircraft operators, which, after carefully considering the comments, TSA now is issuing in final form.

Public comments on the Secure Flight system of records notice and PRA notice generally focused on one or more of the following categories of issues: (1) The program's effect on individual privacy and civil liberties; (2) the routine uses established for the Secure Flight Test Records System (DHS/TSA 017); (3) passenger consent to the use of historical PNRs; (4) the absence of a redress process; (5) concerns with the use of commercial data; (6) the efficacy of the Secure Flight program; (7) TSA's compliance with the Privacy Act, the PRA, and other laws; and (8) possible conflicts of laws involving European Union (EU) data privacy requirements.

A large majority of the commenters viewed the use of PNRs to prescreen passengers against government watchlists as an invasion of privacy and an infringement on their civil liberties, including individuals' right to travel and exercise other Constitutional rights that might be related to travel, such as the freedom of assembly. The National Business Travel Association (NBTA), stated that TSA should balance the need to establish better security measures with policies and procedures that protect civil liberties and privacy. The NBTA also stated that TSA should not impose unnecessary costs on business travelers.

TSA is aware of, and sensitive to, the need to preserve Americans' freedoms while pursing better security. In implementing a new security measure that affects these interests, it is necessary to move deliberately and cautiously. It is for this very reason that TSA is testing the Secure Flight program before moving forward with an operational system.

The prescreening of passengers against Government watchlists is a security measure that has been in place for several years, performed by aircraft operators, using watchlists provided by the Federal Government. Because the airlines have varying systems by which they implement passenger prescreening, the effectiveness, efficiency, and consistency in response for airline passengers of the current system is limited. The Secure Flight program is an effort to move this prescreening process into the Federal Government in order to make the process more effective, consistent, and efficient for the traveling public. This effort is consistent with a specific aviation security recommendation of the 9/11 Commission.

The Secure Flight program will not impose an unconstitutional burden on an individual's right to travel or exercise other Constitutional rights. The Secure Flight program is a limited, reasonable security screening measure designed to further the Federal Government's compelling interest in protecting aviation security. Except in cases where a passenger may authorize TSA to retain information about him or her for purposes of redress, TSA has no long-term need to retain the information and is seeking approval from the National Archives and Records Administration (NARA) to destroy passenger information shortly after completion of the passenger's itinerary. Similarly, for purposes of the test phase of the program, TSA is seeking NARA approval to destroy PNRs used for the test after the test has been completed and the results have been evaluated. TSA's purpose in obtaining PNRs is to test the program, not to maintain information on individuals' travel.

TSA agrees with NBTA's comments regarding the need to have policies and procedures that protect passengers' civil liberties and privacy interests and to ensure the Secure Flight program is effective. TSA is in the process of developing redress procedures that will accomplish these goals, as discussed further below.

The Electronic Privacy Information Center (EPIC) objected to TSA's statement in the System of Records notice that the records created and maintained in the course of the Secure Flight test phase should be exempt from a number of the provisions of the Privacy Act, such as the provision allowing individuals to obtain access to certain records containing information about them.

The Privacy Act specifically permits agencies to exempt from certain of its provisions investigatory materials compiled for law enforcement purposes, because allowing individuals access to law enforcement files could impair investigations, particularly those involving complex or continuing patterns of behavior. The intent of the exemption is to prevent access to law enforcement records if that access would alert subjects that their activities are being scrutinized and allow them to take countermeasures to escape detection and prosecution.

In the Secure Flight system of records notice section entitled “Exemptions Claimed for the System”, TSA stated that for portions of the system it would invoke exemptions to the Privacy Act's requirements such as those that: (1) Permit individuals to obtain access to, and amend, information pertaining to them; and (2) require that information collected by the agency be relevant and necessary to the agency's statutory purpose. (69 FR 57348). TSA is in the process of preparing a notice of proposed rulemaking to implement these exemptions, which will include a detailed explanation of the basis for invoking the exemptions and will offer the public an opportunity to comment further.

At this point, it is unclear whether TSA will need to invoke these exemptions for the Secure Flight program in its operational stage. In order, however, to preserve its ability to protect classified and law enforcement investigatory information from public disclosure, TSA identified these exemptions in the system of records notice as exemptions it may invoke, if necessary. EPIC noted in its comment that certain information in the system of records, such as PNRs, may not be subject to the exemptions and therefore should be releasable to the affected individual under the Privacy Act. TSA agrees with this view. As stated in the system of records notice, TSA will give individuals access to records in the system pertaining to them to the greatest extent feasible, consistent with law enforcement and national security concerns. It should become clearer during the test phase whether the records in the system may be structured in such a way as to exclude any information that must be withheld from the public for the reasons discussed above.

With regard to the requirement that information collected by the agency be “relevant and necessary,” one of the objectives of the test phase is to confirm what information in a PNR is relevant and necessary to conduct an effective comparison of PNRs to information in the TSDB. The results of the test phase should enable TSA to determine more precisely what passenger information is relevant and necessary to the operation of the Secure Flight program and to limit its collection accordingly during the operational stage.

A number of commenters expressed concern that the Secure Flight program could easily be expanded in the future beyond the scope outlined for the test phase. A number of other commenters anticipated that TSA would use passenger data to monitor where individuals travel and with whom they travel or whether they engage in other activities that could come within the First Amendment protection of freedom of assembly. These commenters have misconstrued the purpose of Secure Flight and the requirements that TSA has proposed for this test.

TSA will neither use passenger information to monitor individuals' movements within the country nor share such information with other agencies or third parties. In fact, for the operational phase of Secure Flight, TSA intends to seek approval from NARA to destroy passenger information shortly after completion of the passenger's itinerary. This will preclude TSA from keeping any record of passenger movements around the country. TSA will not monitor the individuals with whom a particular passenger travels.

If testing of the program indicates that it is a feasible and effective security measure, TSA will initiate a public rulemaking process in which it will provide an appropriate proposal for the workings of the system, as well as the redress process. This process, in conjunction with future publication of a Privacy Act system of records notice for the operational stage of the program will limit TSA's activities under Secure Flight to those outlined in the notice and serve as the basis for the operation of the program. To the extent that there are any substantial changes to collection of use of information under the program, these will be subject to additional notice and opportunity for public comment. This transparency will serve to prevent so-called “mission creep.”

One commenter asked whether Secure Flight would use race, color, gender, age, religion, national origin, political views, origin of a passenger's name, disability, or other personal characteristics as the basis for screening decisions. One commenter suggested that TSA would use gun ownership as a basis for screening decisions. Several commenters stated that TSA should use ethnicity or national origin as a screening factor.

With regard to the use of race, gender, national origin, or other factors listed above, Secure Flight will comply with the Constitution and other applicable law. TSA has adopted and complies with the “Guidance Regarding Use of Race by Federal Law Enforcement Agencies” issued by the United States Department of Justice in June 2003.

TSA received several comments on TSA's possible disclosure of personal data obtained for testing the Secure Flight program. Under the Privacy Act, TSA is required to list routine uses of the information it will maintain in the system of records created for testing the Secure Flight program. A routine use is a disclosure of a record outside the Department of Homeland Security for a purpose that is compatible with the purpose for which the information was collected. In its system of records notice for DHS/TSA 017, TSA listed the following routine uses for Secure Flight Test Records:

(1) To the Federal Bureau of Investigation where TSA becomes aware of information that may be related to an individual identified in the Terrorist Screening Database as known or reasonably suspected to be or having been engaged in conduct constituting, in preparation for, in aid of, or related to terrorism;

(2) To contractors, grantees, experts, consultants, or other like persons when necessary to perform a function or service related to the Secure Flight program or the system of records for which they have been engaged. Such recipients are required to comply with the Privacy Act, 5 U.S.C. 552a, as amended;

(3) To the Department of Justice (DOJ) or other Federal agency in the review, settlement, defense, and prosecution of claims, complaints, and lawsuits involving matters over which TSA exercises jurisdiction or when conducting litigation or in proceedings before any court, adjudicative or administrative body, when: (a) TSA; or (b) any employee of TSA in his/her official capacity; or (c) any employee of TSA in his/her individual capacity, where DOJ or TSA has agreed to represent the employee; or (d) the United States or any agency thereof, is a party to the litigation or has an interest in such litigation, and TSA determines that the records are both relevant and necessary to the litigation and the use of such records is compatible with the purpose for which TSA collected the records;

(4) To the National Archives and Records Administration (NARA) or other Federal agencies pursuant to records management inspections being conducted under the authority of 44 U.S.C. 2904 and 2906;

(5) To a Congressional office from the record of an individual in response to an inquiry from that congressional office made at the request of the individual; and

(6) To an agency, organization, or individual for the purposes of performing authorized audit or oversight operations.

Some commenters objected to the disclosure of information to other agencies whose missions are unrelated to counterterrorism or security and to foreign governments. TSA has established a very limited set of routine uses for the Secure Flight Test Records. Consistent with the commenters' view, TSA will disclose information to the FBI in connection with its counterterrorism function where TSA becomes aware of information that may be related to an individual identified in the TSDB as known or reasonably suspected to be or having been engaged in conduct constituting, in preparation for, in aid of, or related to terrorism. The other routine uses applicable to DHS/TSA 017 are necessary for the operation of the agency or the operation and oversight of the Secure Flight program. TSA will not provide any of the information related to the Secure Flight program to foreign governments.

One commenter expressed concern with TSA's plan to allow government contractors access to personal data and suggested that TSA ensure that strong contractual requirements are in place to deter weak data handling practices. TSA will put such contractual requirements in place.

One commenter stated that TSA should ensure that if Secure Flight is used to screen actual passengers, any underlying information about the passenger used to make screening decisions should not be provided to the airlines or screeners. TSA agrees with this comment. One of the main purposes of Secure Flight is to bring within the Federal Government the watchlist comparison results that currently are in the hands of airlines.

Many commenters objected to the government's collection of PNRs for testing purposes because they had not given consent to the collection. As discussed previously, aircraft operators currently use the information in PNRs to conduct passenger prescreening, including watchlists checks and the application of CAPPS. The existence of these prescreening measures has been public knowledge for many years. Therefore, when passengers provide information to aircraft operators in order to purchase air transportation, they have notice that their information will be used for prescreening purposes. In fact, the PNRs TSA will receive for testing Secure Flight already were already used for airline-implemented prescreening in June 2004. Therefore, TSA's collection of the PNRs is consistent with the purposes for which the information in those PNRs originally was collected, and passengers who traveled by air in June 2004 had notice of those purposes.

Commenters noted that TSA has not yet established detailed redress procedures to handle cases where passengers believe they have been unfairly or inaccurately singled out for additional scrutiny as a result of the comparison of their PNRs to information in the TSDB. NBTA stated that TSA should develop a redress process to address inaccuracies in the databases TSA uses to prescreen passengers, including special procedures for corporate travelers to allow them to continue to fly while any security issue is resolved.

TSA is in the process of developing a robust redress program and has begun hiring and is well into the process of developing redress procedures that will be refined during the Secure Flight test in November. For present purposes, however, TSA is only testing the Secure Flight concept. Because the data to be used concerns domestic flights that have already been completed during the month of June 2004 “ meaning that passengers were already screened “ and because the test results will not be used in an operational setting to conduct passenger screening, no passengers will need to avail themselves of the redress process during testing. With respect to special procedures for business travelers, TSA does not, at this point, believe that the Secure Flight program will cause delays that would warrant special treatment for any class of passengers. Information obtained through program testing, however, may be relevant to this issue, and TSA will consider it in developing the operational aspects of the Secure Flight program.

A number of commenters had questions and concerns regarding TSA's plan to test the use of commercial data to identify passenger information that is incorrect or inaccurate. Commenters expressed concern that TSA's access to commercial information would open the door to abuse of individuals' privacy rights and possible theft of their personal information.

As discussed in detail in the Privacy Impact Assessment for the Secure Flight Test Phase (69 FR 57352), TSA's testing of commercial data will be governed by stringent data security and privacy protections, including: contractual prohibitions on commercial entities' maintenance or use of PNR information for any purposes other than testing under TSA parameters; strict firewalls between the government and commercial data providers; real-time auditing procedures to determine when data has been accessed and by whom; and strict rules prohibiting the access or use of commercially held personal data by TSA. TSA will not have access to or store the commercially available data that would be used by commercial data aggregators.

One commenter questioned TSA's need for passengers' credit card information as part of Secure Flight and whether TSA would be using commercial data to check credit histories and other personal information unrelated to Secure Flight. Commenters also had questions about the types of commercial information that could lead TSA to apply enhanced screening or deny an individual access to an aircraft. One commenter suggested that TSA use only those sources of commercial data that are easily corrected by consumers so that if there are errors in commercially available data that lead to incorrect screening decisions by TSA, those errors can be resolved in a timely manner.

These are all are key issues that TSA will be attempting to resolve during the testing phase. Once TSA has information about the feasibility and efficacy of using commercial data, such as credit card numbers, to gauge the accuracy of passenger information and reduce false positive matches to information in the TSDB, the agency will be in a position to provide specific answers to the types of questions raised by the commenters. TSA will not have access to individuals' credit histories, medical records, or other personal records.

A number of commenters expressed concern over access by data aggregators to passenger information during the testing. TSA will require the data aggregators with whom it works to abide by the requirements of the Privacy Act as well as to execute legally enforceable nondisclosure agreements prohibiting their use of information for any purpose other than for the testing of the effectiveness of the use of commercial data for Secure Flight. As a security mechanism, TSA has installed an auditing system as part of the platform on which the Secure Flight program will operate. The auditing mechanism will immediately detect any unauthorized access to the passenger data. Within TSA, individuals who are not conducting the test of the Secure Flight program will not have access to any passenger information. The real-time auditing mechanisms in place should prevent unauthorized access by individuals who are not part of the team conducting the test. TSA personnel with access to information for the testing phase will undergo specialized privacy training and will be required to hold appropriate security clearances and, therefore, will understand the sensitivity of the information to which they have access.

Under section 552(d) of the Department of Homeland Security Appropriations Act, 2005 (Pub. L. 108-334), TSA may not test the use of commercial data until the agency has developed measures to determine the impact of the use of commercial data on aviation security and the Government Accountability Office (GAO) has reported on TSA's evaluation measures. TSA currently is working with GAO to provide the information GAO needs to evaluate TSA's measures.

Commenters questioned the potential effectiveness of the Secure Flight program because, they claim, the information in the TSDB regarding individuals known or suspected of being engaged in terrorist activity is inaccurate. A number of commenters stated that TSA should instead focus its resources and effort on improved physical security measures such as improved checkpoint screening, increased numbers of Federal Air Marshals and Federal Flight Deck Officers, and improved screening of baggage and cargo. NBTA stated that TSA should stress test the Secure Flight system and develop operational safeguards and oversight policies for the program.

TSA agrees with those commenters who have stated that TSA should ensure that the Secure Flight program is effective before going forward with implementation and should have a quick and effective redress process to address situations in which passengers are mistakenly subjected to enhanced scrutiny or believe that they have wrongly been included on a watchlist.

With respect to the suggested choice between developing Secure Flight or directing TSA's resources towards other security measures, TSA approaches security as a layered process. TSA is committed to taking actions that will improve each layer of security and believes that such actions are not mutually exclusive.

The American Civil Liberties Union (ACLU) commented that the continued expansion of government watchlists creates a risk of false positive matches of passengers on watchlists. Therefore, the ACLU stated, effective management of the watchlists will become even more important. Again, TSA agrees that the Secure Flight program must be shown to be effective in achieving its stated goals before it is implemented. In order to determine whether the program can be effective, however, TSA must test the system and is doing so while respecting the privacy and civil liberties of individuals.

A number of commenters stated that Secure Flight would not be effective in identifying terrorists who may travel by air but are not currently known to the Federal Government and therefore are not included in the TSDB. Commenters also stated that even if an individual is included in the TSDB, Secure Flight will not detect that individual if he or she assumes the identity of a person not included in the TSDB, such as through identity theft.

TSA agrees that checking passenger names against information in the TSDB will not identify unknown terrorists or those using a stolen identity. Commercial data may be useful in identifying instances where a passenger may have presented inaccurate or incorrect information.

As discussed previously, however, Secure Flight will involve the use of a streamlined version of the existing CAPPS system that aircraft operators currently are using to prescreen passengers. That system evaluates information in PNRs that passengers otherwise provide to aircraft operators in the normal course of business. This element of Secure Flight will address the threat posed by an individual who may pose a threat but is not included in the TSDB or has assumed the identity of a person not included in the TSDB.

A number of commenters stated that TSA should make public the results of the Secure Flight test phase. TSA will make the results available to the extent consistent with national security and homeland security.

The EPIC stated that OMB should not approve the information collection until TSA provides more detailed information to the public about the Secure Flight program.

The Secure Flight program is at a very early stage of development. The purpose of the test phase is to determine the technical feasibility of a consolidated system by which TSA may compare information in PNRs to information in the TSDB. At this point, therefore, TSA has provided as much detail as it can about the planned workings of the Secure Flight program. Once the test is completed and the results are analyzed, if the test phase indicates that the program is technically feasible, TSA will then be able to engage in a public rulemaking process that will involve a more detailed proposal for the Secure Flight program. This subsequent rulemaking will provide members of the public further opportunity to comment on operational and policy issues raised by the program.

One commenter questioned whether TSA had a basis for receiving emergency processing from OMB of the information collection contained in the proposed order. TSA's request for emergency processing was based on the need to move forward with a new passenger prescreening system as quickly as possible, consistent with the 9/11 Commission's recently issued recommendation that TSA take over from aircraft operators the function of passenger prescreening using government watchlists.

The commenter also articulated a number of aspects of the Secure Flight program that he argued are contrary to the requirements of the Privacy Act or other laws. First, he argued that PNRs constitute information regarding an individual's exercise of the First Amendment right of assembly because travel is a form of assembly.

The Privacy Act imposes certain limits on an agency's authority to collect records describing an individual's exercise of First Amendment Rights. See 5 U.S.C. 552a(e)(7). TSA does not agree that PNRs contain information related to the exercise of First Amendment rights, including the right of assembly.

Second, the commenter argued that TSA's proposed order to aircraft operators to submit PNRs is inconsistent with the requirement that an agency collect information to the maximum extent practical directly from an individual when the information may result in an adverse determination about an individual's rights, benefits, or privileges. See 5 U.S.C. 552a(e)(2). The commenter stated that TSA has failed to show that it would be impractical for TSA staff to collect information about passengers from them directly at the airport prior to boarding.

Collecting information from passengers at the airport for purposes of the Secure Flight test would impose a tremendous burden on the flying public in the form of additional time required for security screening. It also would not allow TSA to obtain and test the information in a PNR format, which is the form in which TSA would receive the information during the operational phase of the program.

Third, the commenter, as well as others, stated that the proposed order is inconsistent with the Privacy Act because passengers whose information will be submitted to TSA under the order did not receive notice in accordance with section 552a(e)(3) of the Privacy Act, which requires a Federal agency to “inform each individual whom it asks to supply information” of: (1) The authority under which the request is made; (2) whether the disclosure of the information is mandatory or voluntary; (3) the principal purpose for which the information is intended to be used and the routine uses which may be made of the information; and (4) the effects on the individual if any, of not providing all or part of the information.

The notice requirement under 5 U.S.C. 552a(e)(3) does not apply to the collection of the PNRs described in the proposed order. OMB has interpreted the notice requirement in section 552a(e)(3) to be inapplicable to situations in which an agency collects information about an individual from a third party.

Fourth, the commenter argues that the system of records notice for Secure Flight fails to meet the requirement in 5 U.S.C. 552a(e)(4)(B) that it describe the categories of individuals on whom records are maintained in the system. The commenter notes that PNRs may contain the names of travel agents or other individuals who make, pay for, or process a passenger's travel but who are not passengers. The commenter also noted that the proposed order covered PNRs with itineraries that were entirely cancelled, thereby capturing individuals who had not flown.

It is our understanding that the inclusion in PNRs of names other than those of passengers is rare. In any case, for purposes of testing the Secure Flight concept, TSA will not retrieve information from PNRs using the names of travel agents or other non-passengers who may be included in a PNR, because the purpose of Secure Flight is to screen passengers. The purpose of listing “Categories of individuals covered” in the system of records notice is to provide notice to those individuals whose records are subject to the Privacy Act because the records are retrieved by their name or personal identifier. The purpose is not to provide notice to every individual whose name may be incidentally mentioned in a record retrieved by the name of another individual. In addition, TSA has revised the final order to exclude from its scope any PNRs with itineraries that have been cancelled in whole, thereby avoiding collection of PNRs for individuals who have not actually completed any part of the itinerary in the PNR. For these reasons, the provision in the system of records notice meets the requirements of the Privacy Act.

Fifth, the commenter argues that TSA has failed to meet certain requirements applicable to the promulgation of regulations under the Airline Deregulation Act, the Aviation and Transportation Security Act, and the Unfunded Mandates Reform Act of 1995, and the Regulatory Flexibility Act. Other commenters noted that TSA has not published a cost-benefit analysis for the Secure Flight program.

As discussed previously, TSA is obtaining historical PNRs for the test phase of Secure Flight through the issuance of an order, not through rulemaking. Therefore, the foregoing statutes, as well as other statutes and Executive Orders that apply to agency rulemaking, do not apply in this instance. If testing of the program indicates that it is a feasible and effective security measure, TSA will initiate a public rulemaking process in which it will again fully comply with all applicable statutory requirements.

Sixth, the commenter argued that TSA has no authority to establish a system of records for Secure Flight or order aircraft operators to provide PNRs to TSA.

TSA has ample authority to conduct the Secure Flight test. Under the Aviation and Transportation Security Act and authority delegated to the Assistant Secretary of Homeland Security (Transportation Security Administration) by the Secretary of Homeland Security, TSA is responsible for, among other things, the screening of passengers and property transported in air transportation and intrastate air transportation. Also under its delegated authority, TSA has broad authority under 49 U.S.C. 40113(a) to issue orders necessary to carry out its statutory duties, which expressly include providing for security screening, under 49 U.S.C. 44901(a). TSA also is authorized to undertake research and development activities necessary to enhance transportation security under 49 U.S.C. 114(f)(8) and create a successor system to the existing CAPPS under 49 U.S.C. 44903(j)(2). Under these authorities, TSA may order aircraft operators to provide PNRs to TSA to test the Secure Flight program. Implementation of the Secure Flight test also is in furtherance of Homeland Security Presidential Directive-6/HSPD-6 of September 23, 2003 (“Integration and Use of Screening Information to Protect Against Terrorism”), which, among other things, directs Federal agencies to conduct screening at all appropriate opportunities using consolidated terrorist information and intelligence about individuals known or appropriately suspected to be or have been engaged in conduct constituting, in preparation for, in aid of, or related to terrorism.

United Airlines and other commenters expressed concern that complying with the proposed order would expose U.S. airlines to liability for violating privacy laws of the Member States of the EU. United suggested that the U.S. government work closely with foreign governments to address any conflicts of laws that may arise. While TSA has clear statutory authority to require the submission of reservation information for use in prescreening passengers on domestic flight segments, TSA understands the sensitivity of aircraft operators to the possibility of conflicting legal obligations under U.S. law and the laws of EU Member States. Therefore, in the interest of implementing this test expeditiously, TSA has determined that for purposes of this test phase, aircraft operators may opt to exclude from PNRs submitted to TSA any PNR that includes a flight segment between the United States and the EU.

TSA and Department officials briefed European Commission (EC) representatives on October 25 to provide further details on Secure Flight testing, including the parameters of data to be submitted for the test. TSA informed the EC that carriers may elect not to submit to TSA for use in testing any PNRs with a flight segment between the EU and the United States. The Department and EC representatives will continue regular discussions to keep the EU fully apprised of TSA's progress regarding Secure Flight, and to receive EU feedback on Secure Flight issues. TSA, in conjunction with DHS, will continue to consult with the EU prior to and during Secure Flight implementation.

United Airlines stated in its comment the concern that the Secure Flight program might result in unnecessary costs to airlines if they are required to establish new systems to transmit passenger information to TSA, rather than relying on existing systems, such as those that U.S. Customs and Border Protection has in place for receiving advance passenger information for international flights. In planning and developing the operational stage of the Secure Flight program, TSA will work to use existing communications links between the airlines and the Federal Government in order to avoid imposing duplicative requirements on the airlines to the greatest extent possible.

The final order is largely unchanged from the proposed order, with the exception of the following provisions.

First, in order to simplify and clarify compliance with the order, TSA changed the scope of PNRs that aircraft operators are required to provide and the description of the category of aircraft operators covered by the order. The proposed order would have required the submission of any PNRs with a flight segment completed during June 2004, so long as all the flight segments in the PNR had been completed by the end of June 2004. Thus, the proposed order covered PNRs with flight segments completed many months before June 2004. The final order applies only to those PNRs with all flight segments (flights between two locations) completed in June 2004.

The proposed order applied to PNRs for any passenger on “a scheduled flight within the United States, in operations subject to a full security program under 49 CFR 1544.101(a).” This language was intended to cover any scheduled passenger or public charter operation conducted under a full security program. Because the proposed order did not specifically mention public charter operations and used the term “scheduled flight,” there was some confusion as to whether TSA intended to cover any public charter operations. The final order clarifies this point by stating the following: “This order applies to aircraft operators that conduct scheduled passenger or public charter operations subject to a full security program under 49 CFR 1544.101(a).”

The proposed order directed aircraft operators to exclude from the PNRs submitted to TSA any flight segment to or from the United States. TSA now understands, however, that deleting information related to flight segments from PNRs is difficult and could inhibit aircraft operators from complying with the order in a timely manner. After reviewing this issue and considering the issues discussed above related to possible conflicts of law with EU Member States, TSA revised the order to allow aircraft operators to exclude entirely from its submission PNRs that include flight segments between the United States and the EU.

TSA has modified the proposed order in response to questions about how the order applied to aircraft operators that use passenger manifests rather than PNRs. The final order provides that if an aircraft operator does not use PNRs, the order applies to the reservation data in whatever form the aircraft operators receive or maintain for operation of a flight, such as a passenger manifest. The final order also clarifies that with respect to codesharing operations, if an aircraft operator does not maintain PNRs or other passenger reservation information for the flights that it operates, the aircraft operator may comply with the order by stipulating in writing to TSA that the entity maintaining such PNRs or other passenger reservation information has agreed to provide the information to TSA on behalf of the aircraft operator. For example, a regional aircraft operator that relies on other aircraft operators to maintain PNRs for the regional operator's flights must stipulate that the other aircraft operators will submit PNRs to TSA on the regional aircraft operator's behalf.

TSA also received questions about how to address situations where PNR history, which was excluded from the scope of the proposed order, includes completed flight segments, which were included in the scope of the proposed order. The final order clarifies that if the PNR history includes information on flight segments already flown, they must be included in the PNR submitted to TSA. In such cases, the aircraft operator may move information on flights flown out of the PNR history or include the entire PNR history in the information submitted to TSA, and TSA will extract the flown flight segments. The final order also clarifies that PNRs must include all data that would have been available to the aircraft operator prior to the completion of the itinerary (active fields), including any “remarks” sections, the reservation creation date, and CAPPS scores and codes.

Finally, the final order provides additional information about how the PNRs are to be submitted, including a requirement that they be password protected.

Based on the foregoing, TSA will issue the following final order to aircraft operators. The text of the final order is set forth below.