[Federal Register Volume 70, Number 144 (Thursday, July 28, 2005)]
[Rules and Regulations]
[Pages 43638-43644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14912]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Part 171

[Docket No. PHMSA-04-19173 (HM-223A)]
RIN 2137-AE04


Applicability of the Hazardous Materials Regulations to a 
``Person Who Offers'' a Hazardous Material for Transportation in 
Commerce

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
DOT.

ACTION: Final rule.

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SUMMARY: PHMSA is amending the Hazardous Materials Regulations to add a 
definition for ``person who offers or offeror.'' The definition adopted 
in this final rule codifies long-standing interpretations and 
administrative determinations on the applicability of those 
regulations.

DATES: This final rule is effective October 1, 2005.

FOR FURTHER INFORMATION CONTACT: Frazer C. Hilder, Office of the Chief 
Counsel, 202-366-4400.

SUPPLEMENTARY INFORMATION:

I. Background

    On September 24, 2004, the Research and Special Programs 
Administration--the predecessor agency to the Pipeline and Hazardous 
Materials Safety Administration (PHMSA)--published a notice of proposed 
rulemaking (NPRM; 69 FR 57245) proposing to add a definition for 
``person who offers or offeror'' to the Hazardous Materials Regulations 
(HMR; 49 CFR parts 171-180). Consistent with previously issued 
administrative determinations, as discussed in the NPRM (69 FR 57247-
48) and placed in the docket for this rulemaking, we proposed to define 
``person who offers or offeror'' to mean ``[a]ny person who does either 
or both of the following: (i) Performs, or is responsible for 
performing, any pre-transportation function required under [the HMR] 
for transportation of the hazardous material [or] (ii) Tenders or makes 
the hazardous material available to a carrier for transportation in 
commerce.'' The proposed definition specifically excluded a carrier 
that transfers, interlines, or interchanges hazardous materials to 
another carrier for continued transportation when the carrier does not 
perform any pre-transportation functions associated with the shipment. 
We further proposed to clarify that an offeror or a carrier may rely on 
information provided by a prior offeror or carrier unless the offeror 
or carrier ``knows, or in the exercise of reasonable care, should 
know'' that the information provided is incorrect.

II. Summary of Final Rule

    In this final rule, we are making the following revisions to the 
HMR:
     We are defining ``person who offers or offeror'' to mean 
any person who performs or is responsible for performing any pre-
transportation function required by the HMR or who tenders or makes the 
hazardous material available to a carrier for transportation in 
commerce. A carrier is not an offeror when it performs a function as a 
condition of accepting a hazardous material for transportation in 
commerce or when it transfers a hazardous material to another carrier 
for continued transportation without performing a pre-transportation 
function.
     We are clarifying that there may be more than one offeror 
of a hazardous material and that each offeror is responsible only for 
the specific pre-transportation functions that it performs or is 
required to perform.
     We are clarifying that each offeror or carrier may rely on 
information provided by a previous offeror or carrier unless the 
offeror or carrier knows or, a reasonable person acting in the 
circumstances and exercising reasonable care, would have knowledge that 
the information provided is incorrect.

III. Comments to the NPRM

    We received 16 comments to the NPRM from industry associations and 
individual shippers and carriers. Most commenters are supportive of the 
goals of this rulemaking, but raise concerns related to the specific 
definition proposed and its impact on both offerors and carriers. These 
comments are discussed in detail below.
    Several commenters raise issues that are beyond the scope of this 
rulemaking. For example, United Air Lines, and the Air Transport 
Association reiterate their objections to a formal interpretation, 
published February 23, 2003, that clarified the timing of ``offer'' and 
``acceptance'' of passenger baggage; they request a comprehensive 
rulemaking on this subject. Because that issue is beyond the scope of 
this rulemaking, it is not addressed in this final rule.

A. Reasonable Reliance and Liability

    As noted above, the NPRM proposed to clarify in Sec.  171.2 that an 
offeror or carrier of a hazardous material may rely on information 
provided by a previous offeror or carrier in the absence of knowledge 
that the information is incorrect. Several commenters suggest that the 
language proposed in the NPRM is ambiguous and should be clarified. 
``The `should know' standard should be interpreted as meaning that a 
carrier cannot rely on information given to the carrier when the 
carrier actually has credible information that the information provided 
by the offeror is incorrect.'' (Association of American Railroads) 
Several commenters object to the use of the phrase ``should know'' in 
the NPRM, noting that a ``carrier must be permitted to rely upon [the 
shipper's certification] and conclude that pre-transportation functions 
have been performed in accordance with all hazardous materials 
regulations.'' (American Trucking Associations) These commenters 
suggest that we should more closely follow the statutory

[[Page 43639]]

language in Federal hazardous materials transportation law (Federal 
hazmat law; 49 U.S.C. 5101 et seq.). Section 5123(a)(1) of Federal 
hazmat law provides that:

    A person acts knowingly when--
    (A) The person has actual knowledge of the facts giving rise to 
the violation; or
    (B) A reasonable person acting in the circumstances and 
exercising reasonable care would have that knowledge.

We agree with commenters that the language proposed in Sec.  171.2 
should reflect the standard for ``knowingly'' established in Federal 
hazmat law. Therefore, in this final rule, we are revising paragraphs 
(b) and (f) of Sec.  171.2 (proposed as paragraphs (a) and (b) of Sec.  
171.2 in the NPRM) for consistency with Federal hazmat law.
    Note that a carrier that knows that information accompanying a 
hazardous materials shipment is incorrect may not accept the shipment 
for transportation unless and until the information has been corrected 
and any discrepancies involving this shipment have been resolved. 
Indeed, a carrier that knows that a hazardous materials shipment does 
not comply with the HMR in any respect (e.g., packaging, markings, 
labels, shipping paper) may not accept the shipment for transportation 
unless and until the problems are corrected and any discrepancies 
resolved.

B. Person Who Offers and Pre-Transportation Functions

    A number of commenters express concern about the definition for 
``person who offers or offeror'' proposed in the NPRM as it applies to 
carriers who may perform pre-transportation functions. These commenters 
support the specific language clarifying that a carrier that interlines 
a hazardous materials shipment is not an offeror when it performs no 
pre-transportation functions, but suggest that this provision of the 
NRPM does not ``deliver the intended certainty.'' (International Vessel 
Operators Hazardous Materials Association (VOHMA) and World Shipping 
Council (WSC)) They assert that the determination of ``when a carrier 
might become an `offeror' * * * is further confused by the statement in 
[HM-223] that suggests that who performs a certain function (not what 
that function is) may determine whether that function is a 
`transportation' function or a `pre-transportation' function.'' 
Referring to statements in the preamble to the HM-223 final rule that 
``fill[ing] and clos[ing] a bulk or non-bulk packaging'' may be a 
``pre-transportation function'' when performed by a shipper or a 
``transportation'' function when performed by a carrier, VOHMA and WSC 
state that ``a carrier can never be an `offeror' by virtue of 
performing a pre-transportation function, because such a function 
performed by a carrier is deemed to be a transportation function'' and 
``the proposed language at 171.8(2) has no meaning.'' These commenters 
state that, because

certain functions (such as verifying and creating documentation) are 
or may be performed at multiple states in the transportation chain 
by both shippers and carriers[,] * * * allocating responsibility for 
those functions on the basis of whether they are performed by a 
carrier or a shipper, or on the basis of whether they are performed 
before or after the initial carrier takes possession of the cargo, 
might simply provide no guidance at all with respect to certain 
functions.

    Similarly, several commenters express concern that a carrier would 
be determined to be an ``offeror'' when performing pre-transportation 
functions. These commenters note that many pre-transportation functions 
are essential components of the transportation services carriers 
provide their customers, such as preparing shipping papers, providing 
and maintaining emergency response information, and reviewing shipping 
papers to verify compliance with the HMR. ``When railroads perform 
these functions as a transporter (excluding the situation where a 
railroad is preparing its own hazardous materials for transportation), 
the hazardous materials are already in transportation. It is 
nonsensical to consider a carrier as performing pre-transportation 
functions after the hazardous materials are in transportation.'' 
(Association of American Railroads (AAR)) AAR suggests modifying the 
second paragraph of the proposed definition of ``person who offers or 
offeror'' to provide that a carrier is not an offeror whenever it 
performs ``a task integral to the transportation of hazardous material 
that would otherwise be classified as a pre-transportation function.''
    Another commenter notes that reviewing shipping papers to verify 
their compliance with the HMR or their international equivalents, which 
is defined as a pre-transportation function, may be performed by a 
carrier as a ``mandated function of `acceptance' for transportation of 
hazardous materials.'' (Currie Associates) This commenter suggests that 
we add specific language to Sec.  171.2 to indicate that the 
performance of a function required as a condition of acceptance of 
hazardous materials offered for transportation does not make a carrier 
an offeror if it performs no other pre-transportation functions.
    These comments illustrate the difficulty of defining the status of 
a ``person who offers or offeror'' based solely on the performance of a 
specific function, as opposed to the proper focus of whether the 
function is part of ``preparing'' a shipment of hazardous material for 
transportation in commerce--including the functions performed by a 
carrier or freight forwarder preparing the shipment for continued 
transportation by a succeeding carrier. As explained in the preamble to 
the HM-223 final rule and recognized in comments to the NPRM, certain 
activities ``may be considered both pre-transportation and 
transportation functions'' and may be performed by a person who 
prepares a shipment for transportation or a person who accepts and 
transports the shipment. 68 FR at 61909. For example, ``blocking and 
bracing and segregation of packages in a transport vehicle are 
functions frequently performed by carrier personnel. However, shipper 
personnel may also perform such functions, particularly when loading 
hazardous materials into freight containers. These are regulated 
functions under the HMR, whether performed by shipper or carrier 
personnel.'' Id. These functions are ``pre-transportation functions'' 
whenever they are performed in the course of preparing the shipment for 
transportation, by an original offeror who transports the shipment 
itself (as a private carrier) or who tenders the shipment to a common 
or private carrier for transportation--or by a carrier or freight 
forwarder who loads a freight container and then tenders the loaded 
container to another carrier for transportation. An initial carrier who 
loads a freight container is a ``person who offers or offeror'' when it 
tenders the loaded container to a succeeding carrier and, if the 
hazardous materials in the container are not properly blocked, braced, 
and segregated, the initial carrier has violated the requirement to 
``offer'' hazardous materials in accordance with the HMR.
    In a similar manner, a carrier or freight forwarder who prepares 
hazardous material shipping documentation that is transmitted to a 
succeeding carrier, in association with the hazardous material 
shipment, is a ``person who offers or offeror'' because it performed a 
pre-transportation function in the course of preparing the shipment for 
transportation by the succeeding carrier. In doing so, the carrier or 
freight forwarder may rely on the information it received from the

[[Page 43640]]

original offeror (or a prior carrier), unless it ``knows or, acting in 
the circumstances and exercising reasonable care, would have knowledge 
that the information provided by the offeror or prior carrier is 
incorrect.'' 49 CFR 171.2(b), (f).
    From their comments, it appears that carriers are concerned, at 
least in part, with the responsibility for the shipment that is 
conferred by application of the term ``person who offers or offeror.'' 
For example, MHF Logistical Solutions (MHF) states that the requirement 
for a ``person who offers a hazardous material for transportation'' to 
``comply with all applicable requirements of this subchapter'' (Sec.  
171.2(b)) should be clarified to make it ``clear that an offeror is 
responsible only for correct performance of the function he performs or 
is contracted to perform. * * * [T]he responsibility of each offeror 
should not extend to functions for which he has no direct 
responsibility.'' MHF adds that an intermediate party such as a 
``transportation logistics provider * * * has limited direct knowledge 
of the material in the load, and accepts the manifest from the owner 
for delivery to the railroad without accepting any contractual 
obligation to verify the correctness of the manifest.'' Similarly, the 
Institute of Makers of Explosives (IME) recommends ``a more simplified 
approach,'' suggesting that ``DOT should expressly authorize those in 
the transportation stream receiving and transferring hazardous 
materials shipments to rely on the information certified and provided 
on shipping papers by the original offeror.''
    We are sympathetic to commenters' concerns that they not be held 
responsible for the performance of pre-transportation functions over 
which they have no control or direct responsibility. We are adopting in 
Sec.  171.2 the language proposed in the NPRM to clarify that each 
offeror is responsible only for the specific pre-transportation 
functions it performs or is required to perform. At the same time, the 
``simplified approach'' suggested by IME is not appropriate, as that 
would absolve everyone in the ``transportation stream'' who may receive 
and transfer hazardous materials shipments from the responsibility to 
make sure that the shipment conforms to all applicable HMR 
requirements. As noted above and discussed in detail in the preamble to 
the NPRM, offerors and carriers may rely on information provided by 
previous offerors or carriers, but that reliance is not absolute. An 
offeror or carrier that knows or should have known that the information 
is incorrect violates Federal hazmat law.
    We agree with commenters that a carrier that performs functions as 
part of the process of accepting a hazardous material for 
transportation in commerce--functions that would, in other contexts, be 
considered pre-transportation functions--should not be considered a 
``person who offers or offeror'' for purposes of the HMR. For example, 
a carrier who reviews a shipping paper accompanying a shipment of 
hazardous material that was tendered by an offeror before accepting 
that shipment for transportation in commerce, or who transfers without 
change information from a shipping paper to a shipping document for its 
own use, is not a ``person who offers or offeror''. Therefore, in this 
final rule, we are adding a sentence in the definition of ``person who 
offers or offeror'' in Sec.  171.8 to indicate that a carrier that 
performs a function required by the HMR as a condition of acceptance of 
hazardous materials offered for transportation in commerce (e.g., 
reviewing shipping papers, examining packages to identify any 
discrepancies or problems, or preparing shipping documents for its own 
use) is not an offeror when it performs no other pre-transportation 
functions. Of course, in performing its carrier functions, the carrier 
must also exercise reasonable care.

C. Joint and Several Liability

    The Radiopharmaceutical Shippers and Carriers Conference asks us to 
``reject'' that part of a formal interpretation published by RSPA in 
1988 (55 FR 6761) that stated that, in the situation where more than 
one person is responsible for performing offeror functions, ``each such 
person may be held jointly and severally liable for all or some of the 
`offeror' responsibilities under the HMR.'' We note with respect to 
this comment that the concept of ``joint and several liability'' does 
not strictly apply to violations of the HMR when there are multiple 
persons; rather, each person is liable for its own violations that may 
involve noncompliance in: (1) Preparing a shipment of hazardous 
material for transportation (i.e., improperly performing or failing to 
perform a pre-transportation function); (2) accepting for 
transportation a shipment of hazardous material that does not conform 
to the requirements in the HMR; or (3) failing to handle or transport a 
shipment of hazardous material in the manner required by the HMR. Thus, 
each person who knowingly violates an ``offeror'' requirement in the 
HMR may be assessed a civil penalty, and payment of a penalty by one 
violator does not satisfy a penalty assessed against another violator 
(unlike ``joint and several liability,'' where payment by one party 
satisfies the obligations of all liable parties).
    Further, we explicitly reject any notion, advanced by some 
commenters, that Federal agencies that enforce the HMR attempt to hold 
one party liable for another party's violation of the HMR. In other 
words, when a carrier accepts and transports a shipment of hazardous 
material that is not properly prepared for transportation in commerce, 
with actual or constructive knowledge of the noncompliance, the 
carrier's liability is based on its own improper acceptance and 
transportation of that shipment--not the violation of the person who 
improperly prepared the shipment. The application of ``constructive 
knowledge''--when ``a reasonable person acting in the circumstances and 
exercising reasonable care would have * * * actual knowledge of the 
facts giving rise to the violation'' of the law or the HMR--is set 
forth in RSPA's prior interpretation published in the Federal Register, 
63 FR 30411, 30412 (June 4, 1998), where we stated that:

    [A] carrier knowingly violates the HMR when the carrier accepts 
or transports a hazardous material with actual or constructive 
knowledge that a package contains a hazardous material which has not 
been packaged, marked, labeled, or described on a shipping paper as 
required by the HMR. This means that a carrier may not ignore 
readily apparent facts that indicate that either (1) a shipment 
declared to contain a hazardous material is not properly packaged, 
marked, labeled, placarded, or described on a shipping paper, or (2) 
a shipment actually contains a hazardous material governed by the 
HMR despite the fact that it is not marked, labeled, placarded, or 
described on a shipping paper as containing a hazardous material.
* * * * *
    At the same time, an offeror who fails to properly declare (and 
prepare) a shipment of hazardous materials bears the primary 
responsibility for a hidden shipment. Whenever hazardous materials 
have not been shipped in compliance with the HMR, DOT generally will 
attempt to identify and bring an enforcement action against the 
person who first caused the transportation of a noncomplying 
shipment * * *.
    To the extent that any carrier, regardless of the mode of 
transportation, is truly ``innocent'' in accepting an undeclared or 
hidden shipment of hazardous materials, it lacks the knowledge 
required for assessment of a civil penalty.

The separate proceeding in Docket No. OST-01-10380 will consider the 
appropriateness of providing further discussion or examples of when a

[[Page 43641]]

carrier may be found to have sufficient knowledge for civil liability.

D. Definition of the Term ``Shipper''

    Several persons ask about our use of the word ``shipper'' in the 
HMR and letter interpretations. FPL Group states that RSPA has also 
used the term ``shipper'' in interpretation letters and that word is 
``printed on common straight bills of lading that can be purchased at 
truck stops and from hazmat supply companies.'' FPL concludes that ``a 
`shipper' and an `offeror' are the same'', and it recommends that the 
term ``shipper'' either be defined or added to the definition of 
``offeror'' in order to avoid confusion. IME indicates that it assumes 
that we mean ``offeror'' when we use the word ``shipper.'' The National 
Automobile Dealers Associate (NADA) states that the proposed definition 
of ``person who offers or offeror'' does not ``clarify its relationship 
to the term `shipper,' also currently undefined.'' NADA also states 
that there should be ``only one `person who offers or offeror' for any 
given shipment of hazardous materials, and that such person is the one 
who `tenders or makes a hazardous material available to a carrier for 
transportation in commerce, notwithstanding the extent to which such 
person actually performs applicable pre-transportation functions.' ''
    Currie Associates complains that the practice of a railroad listing 
a prior (or successor) ocean carrier as the ``shipper'' on a train 
consist (because the railroads' ``computerized systems are designed to 
list the `billable party' as the shipper'') has caused ``unfounded 
charges being filed against the steamship line as the intermodal 
`offeror''' when it carries forward ``the emergency response telephone 
number'' listed on the shipping papers prepared by the original shipper 
(offeror). VOHMA and WSC also state that ``ocean carriers are placed in 
the impossible situation of having to choose between being cited for a 
violation of the HMR when they pass along the original emergency 
response telephone contact number to a connecting rail carrier on the 
one hand, or, on the other hand, providing their own telephone number--
a number that will be essentially useless to a first responder,'' and 
they proposed that the ``exclusion'' language in subparagraph (2) of 
the proposed definition of ``person who offers or offeror'' be revised 
as follows:

    Notwithstanding anything to the contrary in subsection (1), no 
carrier shall be deemed to be an offeror by virtue of the fact that 
such carrier transfers, interlines, or interchanges (either between 
or within transportation modes) hazardous material to another 
carrier for transportation. No description of such a carrier in any 
commercial document as a ``shipper,'' ``customer,'' ``tenderer,'' 
``offeror,'' or other similar description shall change the operation 
of the rule set forth in the immediately preceding sentence. Without 
limiting the generality of the foregoing, no transferring, 
interlining, or interchanging carrier shall be deemed to be the 
offeror of a hazardous material for transportation for the purposes 
of section 172.604 of this title (emergency response telephone 
number) or any successor section thereto.

    Current Federal hazardous material transportation law has a history 
of almost 100 years, and the current HMR evolved over that period of 
time. When the word ``shipper'' is used, such as in the title of Part 
173--``Shippers-General Requirements for Shipments and Packagings''--
that word refers to a person who prepares a shipment for 
transportation. As already discussed, that person may also be a 
carrier, when it prepares the shipment for its own transportation (as a 
private carrier) or for transportation by a succeeding carrier. The 
word ``shipper'' is not used in the HMR in a commercial or contractual 
sense that denotes the economic arrangements of a shipment. We 
understand that, in certain circumstances, the consignee or recipient 
of a shipment may be listed as the ``shipper'' on a bill of lading, 
despite the fact that this person had nothing to do with preparing the 
shipment for transportation or the transportation itself. However, the 
designation of a person as a ``shipper'' on a bill of lading or other 
documents associated with a shipment of hazardous material is not 
determinative of whether that person is a ``person who offers or 
offeror'' for purposes of the HMR.
    At this time, we do not believe it is necessary to modify the HMR 
to clarify the meaning of the term ``shipper.'' Moreover, any such 
modification would be beyond the scope of this rulemaking. However, as 
we continue to assess the effectiveness of the revisions adopted in 
this final rule, we may decide to clarify the term ``shipper'' in a 
future rulemaking.

E. Emergency Response Telephone Number

    As noted above, VOHMA and WSC express concern about enforcement 
issues associated with transferring an emergency response telephone 
number provided by the original offeror of a shipment to shipping 
documents prepared by a subsequent offeror or carrier to facilitate the 
continued movement of a hazardous material. In addition, IME asks DOT 
to clarify whether a freight forwarder or other carrier may 
legitimately transfer an emergency response telephone number ``from 
that origin offeror's shipping paper to other shipping documents made 
necessary by intermodal transportation.'' IME states that ``[e]mergency 
response telephone numbers and other essential information, such as the 
description of the hazardous material, from origin offeror's shipping 
papers are routinely transferred by entities in the transportation 
chain to forwarding shipping documents.'' Further, the American 
Chemistry Council commented that, in order for an organization such as 
CHEMTREC, which provides emergency response services, including a 24-
hour telephone answering service, under contract to hazardous materials 
shippers and carriers, to be able to provide detailed emergency 
response information,

    the offeror identified on the shipping paper must in fact be 
registered. In other words, either the ``preceding offeror'' should 
be shown on the shipping paper, or the party that has taken on 
offeror functions (such as a freight forwarder) should itself be 
registered. The Council therefore requests that RSPA make clear to 
the regulated community the importance of retaining the linkage 
between an offeror and the organization that provides the offeror 
with emergency response telephone service.

    As stated in the NPRM, a carrier or freight forwarder that prepares 
a new shipping paper must comply with all applicable requirements, but 
it may rely on information provided by the original offeror in 
preparing the new shipping paper. A carrier ``may not accept for 
transportation or transport a shipment of hazardous material when the 
carrier is aware (or should be aware) of facts indicating that the 
emergency response telephone number is not operative and does not meet 
the requirements of [49 CFR] 172.604(b).'' RSPA's February 10, 2004 
letter to Hyundai America Shipping Agency, Inc. and June 27, 1996 
letter to ``K'' Line America, Inc. in the docket. This principle was 
restated in the preamble to the NPRM, which reads:

    [A] carrier or freight forwarder may not rely on an emergency 
response telephone number provided by a preceding offeror when it is 
aware (or should be aware) of facts indicating the emergency 
response telephone number is not operative and does not meet the 
requirements of [49 CFR] 172.604(b).

69 FR at 57248 (internal quotations and citations omitted).

    PHMSA agrees with the commenters that the original offeror is 
likely to have the most detailed information concerning the specific 
material and its

[[Page 43642]]

hazards and therefore is best situated ``to provide specific 
information relative to the hazards of the materials being transported 
and provide immediate initial emergency response guidance until further 
specific information can be obtained* * *relative to long term 
mitigation actions.'' 54 FR 27138, 27142 (1989). Thus, a carrier or 
subsequent entity in the transportation chain may transfer the 
emergency response number provided on the original shipping paper by 
the original offeror to subsequent shipping documentation unless he or 
she knows (or should have known) that the number is not operative or 
does not meet the requirements in Sec.  172.604 of the HMR.
    The comments cited above and separate proceedings have made us 
aware of the potential problems that may arise when the original 
offeror contracts with an agency or organization that accepts 
responsibility for providing detailed emergency response information 
pursuant to Sec.  172.604(b), but the identity of the original offeror 
is not set forth on the shipping paper in the possession of the carrier 
at the time of an incident during transportation. We plan to address 
this issue in greater detail in a separate rulemaking. In the meantime, 
the issue of the linkage between a third-party emergency response 
services provider, such as CHEMTREC, and the person who arranges to use 
such services to comply with Sec.  172.604(b) of the HMR should be 
handled through the contract that governs the relationship. Thus, a 
person who arranges with a third-party to provide emergency response 
services required by the HMR should ensure that the shipping 
documentation that accompanies the shipment includes the information 
necessary to enable the third-party provider to identify the person who 
has contracted for emergency response services. This may necessitate 
special arrangements with subsequent offerors or carriers that will 
transfer the information provided by the original offeror to subsequent 
shipping documentation.

F. Transferring, Interlining, or Interchanging Hazardous Materials 
Shipments

    In this final rule, we include in the definition of the term 
``person who offers or offeror'' a provision that a carrier that 
transfers a hazardous material to another carrier for continued 
transportation is not an offeror when it performs no pre-transportation 
functions. We recognize that the terms ``interline,'' and 
``interchange'' have specific meanings within the context of the 
functions performed and that these meanings may not, in fact, be 
applicable to all modes of transportation. Therefore, in this final 
rule, we are revising the language proposed in the NPRM to indicate 
that a carrier who transfers a hazardous material to another carrier 
for continued transportation is not an offeror when it performs no pre-
transportation functions. In this context, the term ``transfer'' means 
the shipment is physically passed or conveyed from one carrier to 
another for continued transportation in commerce.
    We are aware that there also may be uncertainty over the use of the 
term ``tender'' in the definition for ``person who offers or offeror'' 
adopted in this final rule. The term ``tender'' is used to mean that 
the person who offers the hazardous material for transportation makes 
the hazardous material physically available to the originating carrier 
to begin its transportation in commerce.

G. Miscellaneous Issue

    In response to a question from a commenter, we confirm that a 
``data entry person'' who prepares a ``carrier masterbill'' is a hazmat 
employee who must be trained and tested in accordance with the 
requirements in 49 CFR 172.704--even if the shipment and its 
accompanying documentation are subsequently checked by a trained 
individual.

IV. Regulatory Analyses and Notices

A. Statutory/Legal Authority for This Rulemaking

    This final rule is published under the authority of 49 U.S.C. 
5103(b), which authorizes the Secretary of Transportation to prescribe 
regulations for the safe transportation, including security, of 
hazardous material in intrastate, interstate, and foreign commerce. As 
set forth in 49 U.S.C. 5103(b)(1)(A), the regulations are to apply to, 
among others, a person transporting a hazardous material in commerce or 
causing hazardous material to be transported in commerce. In this final 
rule, we are codifying in the HMR longstanding interpretations 
concerning the applicability of the HMR to persons who offer hazardous 
materials for transportation. The terms ``offer'' or ``person who 
offers'' are used throughout the HMR to describe the process of causing 
a hazardous materials to be transported in commerce. Codifying the 
applicability of the HMR to persons who offer hazardous materials for 
transportation will help the regulated community understand and comply 
with regulatory requirements applicable to specific situations and 
operations.

B. Executive Order 12866 and DOT Regulatory Policies and Procedures

    This final rule is not considered a significant regulatory action 
under Executive Order 12866 and, therefore, was not reviewed by the 
Office of Management and Budget. The rule is not considered a 
significant rule under the Regulatory Policies and Procedures of the 
Department of Transportation (44 FR 11034). No further regulatory 
evaluation is necessary because the definition of ``person who offers 
or offeror'' simply restates and codifies long-standing interpretations 
on the applicability of the HMR without making any substantive change 
and, thus, does not increase or decrease either the number of persons 
who must comply with the HMR or the costs of compliance with the HMR by 
those persons. No person who submitted comments on the NPRM provided 
any information to show that this final rule increases or decreases the 
costs of compliance with the HMR.

C. Executive Order 13132 (Federalism)

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13132 (``Federalism''). This 
rule makes no change in the applicability of the HMR or, to the extent 
that the HMR have been adopted by a State and are being enforced as 
State requirements, the applicability of those State requirements. For 
this reason, PHMSA believes that nothing in this rule will preempt any 
State law or regulation or have any substantial direct effect or 
sufficient federalism implications that limit the policymaking 
discretion of the States. PHMSA did not receive any comment from a 
State or other interested party on whether it believed any State 
requirement is affected by the adoption of this rule.

D. Executive Order 13175

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13175 (``Consultation and 
Coordination with Indian Tribal Governments''). Because this rule does 
not have tribal implications and does not impose substantial direct 
compliance costs, the funding and consultation requirements of 
Executive Order 13175 do not apply.

E. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an 
agency to review regulations to assess their impact on small entities 
unless the agency determines that a rule is not expected to

[[Page 43643]]

have a significant economic impact on a substantial number of small 
entities.
    Need and legal basis for the rule. This final restates and codifies 
prior interpretations on the applicability of the HMR to persons who 
offer a hazardous material for transportation in commerce. This rule is 
issued under the requirement in 49 U.S.C. 5103(b)(1)(A) for DOT to 
issue regulations for the safe transportation of hazardous material in 
intrastate, interstate, and foreign commerce that apply to a person 
causing hazardous material to be transported in commerce.
    Identification of potentially affected small entities. Unless 
alternative definitions have been established by an agency in 
consultation with the Small Business Administration (SBA), the 
definition of ``small business'' has the same meaning under the Small 
Business Act. Because no special definition has been established, PHMSA 
employs the thresholds published by SBA for industries subject to the 
HMR. Based on data for 1997 compiled by the U.S. Census Bureau, it 
appears that upwards of 95 percent of firms who are subject to the HMR 
are small businesses. These entities will incur no new costs to comply 
with the HMR, because this final rule makes no change in the 
applicability of the HMR.
    Related Federal rules and regulations. The Occupational Safety and 
Health Administration (OSHA) of the U.S. Department of Labor issues 
regulations related to safe operations, including containment and 
transfer operations, involving hazardous materials in the workplace. 
These regulations are codified at 29 CFR part 1910 and include 
requirements for process safety management of highly hazardous 
chemicals and for operations involving specific hazardous materials, 
such as compressed gases, flammable and combustible liquids, explosives 
and blasting agents, liquefied petroleum gases, and anhydrous ammonia. 
OSHA regulations also address hazard communication requirements at 
fixed facilities, including container labeling and other forms of 
warning, material safety data sheets, and employee training.
    The U.S. Environmental Protection Agency (EPA) issues regulations 
on the management of hazardous wastes, including the tracking of 
hazardous wastes transported from a generator to a treatment, storage, 
or disposal facility. These regulations are codified at 40 CFR parts 
260-265. As provided by Section 3003(b) of the Resource Conservation 
and Recovery Act (42 U.S.C. 6923(b)), EPA's regulations applicable to 
transporters of hazardous waste are consistent with requirements in the 
HMR.
    EPA also issues regulations designed to prevent accidental release 
into the environment of hazardous materials at fixed facilities, 
codified at 40 CFR part 68. These regulations include requirements for 
risk management plans that must include a hazard assessment, a program 
for preventing accidental releases, and an emergency response program 
to mitigate the consequences of accidental releases. EPA regulations on 
hazardous materials at fixed facilities also address community right-
to-know requirements, hazardous waste generation, storage, disposal and 
treatment, and requirements to prevent the discharge of oil into or 
onto the navigable waters of the United States or adjoining shorelines.
    The Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) of 
the U.S. Department of Justice issues regulations on licensing, 
permitting and safe handling (including storage) of explosives, 
codified at 27 CFR part 555. These regulations do not apply to ``any 
aspect of the transportation of explosive materials via railroad, 
water, highway, or air which are regulated by the United States 
Department of Transportation and agencies thereof, and which pertain to 
safety.'' 18 U.S.C. 845(a)(1).
    The Nuclear Regulatory Commission issues regulations, codified in 
10 CFR, governing its licensees who acquire, receive, possess, use, and 
transfer certain radioactive materials, including requirements on 
packagings used in transporting these materials and the physical 
protection of these materials at fixed facilities and during 
transportation.
    Conclusion. This final rule makes no change in the applicability of 
the HMR and imposes no new costs of compliance with the HMR 
requirements. I hereby certify that the rule does not have a 
significant economic impact on a substantial number of small entities.

F. Unfunded Mandates Reform Act of 1995

    This final rule does not impose any mandate and thus does not 
impose unfunded mandates under the Unfunded Mandates Reform Act of 
1995.

G. Paperwork Reduction Act

    This final rule does not impose any new information collection 
requirements.

H. Environmental Assessment

    There are no environmental impacts associated with this final rule.

I. Regulation Identifier Number (RIN)

    A regulation identifier number (RIN) is assigned to each regulatory 
action listed in the Unified Agenda of Federal Regulations. The 
Regulatory Information Service Center publishes the Unified Agenda in 
April and October of each year. The RIN contained in the heading of 
this document may be used to cross-reference this action with the 
Unified Agenda.

J. Privacy Act

    Anyone is able to search the electronic form of all comments 
received into any of our dockets by the name of the individual 
submitting the comment (or signing the comment, if submitted on behalf 
of an association, business, labor union, etc.). You may review DOT's 
complete Privacy Act Statement in the Federal Register published on 
April 11, 2000 (Volume 65, Number 70, pages 19477-78), or at http://dms.dot.gov.

List of Subjects in 49 CFR Part 171

    Exports, Hazardous materials transportation, Hazardous Waste, 
Imports, Reporting and recordkeeping requirements.


0
In consideration of the foregoing, 49 CFR, subtitle B, chapter I is 
amended as follows:

PART 171--GENERAL INFORMATION, REGULATIONS AND DEFINITIONS

0
1. The authority citation for part 171 continues to read as follows:

    Authority: 49 U.S.C. 5101-5127, 44701, 49 CFR 1.45 and 1.53; 
Pub. L. 101-410 section 4 (28 U.S.C. 2461 note); Pub. L. 104-134 
section 31001.


0
2. In Sec.  171.2, revise paragraphs (b) and (f), to read as follows:


Sec.  171.2  General requirements.

* * * * *
    (b) Each person who offers a hazardous material for transportation 
in commerce must comply with all applicable requirements of this 
subchapter, or an exemption, approval, or registration issued under 
this subchapter or under subchapter A of this chapter. There may be 
more than one offeror of a shipment of hazardous materials. Each 
offeror is responsible for complying with the requirements of this 
subchapter, or an exemption, approval, or registration issued under 
this subchapter or subchapter A of this chapter, with respect to any 
pre-transportation function that it performs or is required to perform; 
however, each offeror is responsible only for the specific pre-
transportation functions

[[Page 43644]]

that it performs or is required to perform, and each offeror may rely 
on information provided by another offeror, unless that offeror knows 
or, a reasonable person, acting in the circumstances and exercising 
reasonable care, would have knowledge that the information provided by 
the other offeror is incorrect.
* * * * *
    (f) No person may transport a hazardous material in commerce unless 
the hazardous material is transported in accordance with applicable 
requirements of this subchapter, or an exemption, approval, or 
registration issued under this subchapter or subchapter A of this 
chapter. Each carrier who transports a hazardous material in commerce 
may rely on information provided by the offeror of the hazardous 
material or a prior carrier, unless the carrier knows or, a reasonable 
person, acting in the circumstances and exercising reasonable care, 
would have knowledge that the information provided by the offeror or 
prior carrier is incorrect.
* * * * *

0
3. In Sec.  171.8, add a definition for ``person who offers or 
offeror'' in appropriate alphabetical order, to read as follows:


Sec.  171.8  Definitions and abbreviations.

    Person who offers or offeror means:
    (1) Any person who does either or both of the following:
    (i) Performs, or is responsible for performing, any pre-
transportation function required under this subchapter for 
transportation of the hazardous material in commerce.
    (ii) Tenders or makes the hazardous material available to a carrier 
for transportation in commerce.
    (2) A carrier is not an offeror when it performs a function 
required by this subchapter as a condition of acceptance of a hazardous 
material for transportation in commerce (e.g., reviewing shipping 
papers, examining packages to ensure that they are in conformance with 
this subchapter, or preparing shipping documentation for its own use) 
or when it transfers a hazardous material to another carrier for 
continued transportation in commerce without performing a pre-
transportation function.
* * * * *

    Issued in Washington, DC on July 21, 2005, under authority 
delegated in 49 CFR part 1.
Brigham A. McCown,
Deputy Administrator.
[FR Doc. 05-14912 Filed 7-27-05; 8:45 am]
BILLING CODE 4910-60-P