We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include the docket number “FAA-2007-27756; Directorate Identifier 2006-NM-255-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments.

We will post all comments we receive, without change, to http://dms.dot.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment 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 (65 FR 19477-78), or you may visit http://dms.dot.gov.

You may examine the AD docket on the Internet at http://dms.dot.gov, or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone (800) 647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them.

The FAA has examined the underlying safety issues involved in fuel tank explosions on several large transport airplanes, including the adequacy of existing regulations, the service history of airplanes subject to those regulations, and existing maintenance practices for fuel tank systems. As a result of those findings, we issued a regulation titled “Transport Airplane Fuel Tank System Design Review, Flammability Reduction and Maintenance and Inspection Requirements” (66 FR 23086, May 7, 2001). In addition to new airworthiness standards for transport airplanes and new maintenance requirements, this rule included Special Federal Aviation Regulation No. 88 (“SFAR 88,” Amendment 21-78, and subsequent Amendments 21-82 and 21-83).

Among other actions, SFAR 88 requires certain type design (i.e., type certificate (TC) and supplemental type certificate (STC)) holders to substantiate that their fuel tank systems can prevent ignition sources in the fuel tanks. This requirement applies to type design holders for large turbine-powered transport airplanes and for subsequent modifications to those airplanes. It requires them to perform design reviews and to develop design changes and maintenance procedures if their designs do not meet the new fuel tank safety standards. As explained in the preamble to the rule, we intended to adopt airworthiness directives to mandate any changes found necessary to address unsafe conditions identified as a result of these reviews.

In evaluating these design reviews, we have established four criteria intended to define the unsafe conditions associated with fuel tank systems that require corrective actions. The percentage of operating time during which fuel tanks are exposed to flammable conditions is one of these criteria. The other three criteria address the failure types under evaluation: Single failures, single failures in combination with a latent condition(s), and in-service failure experience. For all four criteria, the evaluations included consideration of previous actions taken that may mitigate the need for further action.

We have determined that the actions identified in this proposed AD are necessary to reduce the potential of ignition sources inside fuel tanks, which, in combination with flammable fuel vapors, could result in fuel tank explosions and consequent loss of the airplane.

We have received a report of an overheated and damaged sump heater on a center wing fuel tank. Investigation revealed that several incidents of this kind had occurred in the past and that damage was caused by fatigue failure of the sump heater thermostat. Additionally, SFAR 88 analysis has identified certain lightning protection issues with the center wing crossfeed and scavenge valves, as well as frictional heating and sparking issues with the scavenge pump. Deactivating the sump heater, the scavenge valve and the scavenge pump will address all three issues. If not corrected, operation with a damaged sump heater thermostat or scavenge pump, or operation of the crossfeed and scavenge valves during lightning conditions could lead to a possible ignition source in the fuel tank and a potential fire or explosion.

We have reviewed Boeing Alert Service Bulletin DC8-28A089, dated November 1, 2006. The service bulletin describes procedures for deactivating the sump heater, scavenge valve, and scavenge pump of the center wing fuel tank. Accomplishing the actions specified in the service information is intended to adequately address the unsafe condition.

We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other airplanes of this same type design. For this reason, we are proposing this AD, which would require accomplishing the actions specified in the service information described previously.

There are about 119 airplanes of the affected design in the worldwide fleet. The following table provides the estimated costs for U.S. operators to comply with this proposed AD.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that the proposed regulation:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation.

Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

Comments Invited

We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include the docket number “FAA-2007-27755; Directorate Identifier 2006-NM-289-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments.

We will post all comments we receive, without change, to http://dms.dot.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477-78), or you may visit http://dms.dot.gov.

You may examine the AD docket on the Internet at http://dms.dot.gov, or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone (800) 647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them.

Transport Canada Civil Aviation (TCCA), which is the airworthiness authority for Canada, notified us that an unsafe condition may exist on certain Bombardier Model DHC-8-400 series airplanes. TCCA advises that it has received several reports of fluid loss in the No. 2 hydraulic system, causing the power transfer unit (PTU) to overspeed. This resulted in pressure fluctuations and increased fluid flow within the No. 1 hydraulic system. In one case, the hydraulic system control logic did not shut down the PTU, and the overspeed condition persisted, resulting in the illumination of the No. 1 “HYD FLUID HOT” caution light. This caution light indicated that the hydraulic fluid temperature had exceeded 225 degrees Fahrenheit. Had the temperature of the hydraulic fluid continued to increase to 275 degrees Fahrenheit, the No. 1 system hydraulic firewall shutoff would have closed, leaving only the standby power unit (SPU) available. The SPU is not capable of meeting the increased flow demands of the PTU and other No. 1 hydraulic system services. Therefore, the No. 1 hydraulic system would have also been lost, leaving only the No. 3 hydraulic system available. Inoperative systems would include flaps, brakes and emergency brakes, nose wheel steering, and all primary flight controls other than elevator control and degraded aileron control.

This condition, if not corrected, could result in the potential loss of several functions essential for safe flight and landing of the airplane.

Bombardier has issued the following airplane flight manual (AFM) temporary amendments:

These airplanes are manufactured in Canada and are type certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement. Pursuant to this bilateral airworthiness agreement, TCCA has kept the FAA informed of the situation described above. We have examined TCCA's findings, evaluated all pertinent information, and determined that we need to issue an AD for airplanes of this type design that are certificated for operation in the United States. Therefore, we are proposing this AD, which would require revising the Limitations section of the AFM to include procedures for pulling the “HYD PWR XFER” circuit breaker in the event of the loss of all hydraulic fluid in the No. 1 or No. 2 hydraulic system.

We consider this proposed AD interim action. The manufacturer is currently developing a modification that will address the unsafe condition identified in this proposed AD. Once this modification is developed, approved, and available, we might consider additional rulemaking.

The following table provides the estimated costs for U.S. operators to comply with this proposed AD.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that the proposed regulation:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation.

Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

In the Federal Register of February 14, 1984 (49 FR 5714), FDA published a proposed rule (the 1984 proposal) to approve the use of ionizing radiation on several foods. The 1984 proposal did not include a requirement for labeling disclosing the use of ionizing radiation. FDA received over 5,000 comments on this proposal, including numerous comments on the issue of labeling irradiated foods. Based on the comments and information received in response to the 1984 proposal and on further analysis, FDA published a final rule in the Federal Register on April 18, 1986 (51 FR 13376) (the 1986 final rule). The 1986 final rule required that the label and labeling of retail packages and displays of irradiated food bear both the radura logo and a radiation disclosure statement (“Treated with radiation” or “Treated by irradiation”). FDA concluded that labeling indicating treatment of food with radiation was necessary to prevent misbranding of irradiated foods because irradiation may not visually change the food and in the absence of a label statement, the implied representation to consumers is that the food has not been processed. We stated in the preamble to the 1986 final rule that, in addition to the mandatory language, the manufacturer may also state on the wholesale or retail label the purpose of the treatment process or further describe the kind of treatment used (51 FR 13376 at 13387). That is, the manufacturer may include in the labeling any phrase such as “treated with radiation to control spoilage,” “treated with radiation to extend shelf life,” or “treated with radiation to inhibit maturation,” as long as the phrase truthfully describes the primary purpose of the treatment. Similarly, the manufacturer may choose to state more specifically the type of radiation used in the treatment, i.e., “treated with x-radiation,” “treated with ionizing radiation,” or “treated with gamma radiation,” if more specific description is applicable.

On November 21, 1997, the Food and Drug Administration Modernization Act (FDAMA) (Public Law 105-115) was enacted. Section 306 of FDAMA amended the act by adding section 403C (21 U.S.C. 343-3). Section 403C of the act addressed the disclosure of irradiation on the labeling of foods as follows:

“(a) No provision of section 201(n), 403(a), or 409 shall be construed to require on the label or labeling of a food a separate radiation disclosure statement that is more prominent than the declaration of ingredients required by section 403(i)(2).

(b) In this section, the term “radiation disclosure statement” means a written statement that discloses that a food has been intentionally subject to radiation.”

Although section 403C of the act addressed only the prominence of the radiation disclosure statements, the language in the FDAMA Joint Statement (H. Rep. 105-399, 105th Cong., 1st sess., at 98-99) stated that FDA should seek public comment on whether additional changes should be made to current regulations relating to the labeling of foods treated with ionizing radiation. Specifically, the Joint Statement stated that “the public comment process should be utilized by the Secretary to provide an opportunity to comment on whether the regulations should be amended to revise the prescribed nomenclature for the labeling of irradiated foods and on whether such labeling requirements should expire at a specified date in the future.” The FDAMA Joint Statement also indicated that “The conferees intend for any required irradiation disclosure to be of a type and character such that it would not be perceived to be a warning or give rise to inappropriate anxiety” (Ref. 1).

In response to the conferees' report, FDA published an ANPRM in the Federal Register of February 17, 1999 (64 FR 7834) seeking public comment on the meaning of the current irradiation labeling statement and soliciting suggestions for possible revisions. The 1999 ANPRM described the intent of the conference report, cited several documents related to irradiation labeling, and asked for comment on how the current label is perceived by consumers. The 1999 ANPRM also described whether other labeling would more accurately convey that the food was irradiated without implying a warning or causing inappropriate consumer anxiety.

FDA received over 5,550 comments in response to the 1999 ANPRM on the meaning of the current irradiation labeling statement and suggestions for possible revisions. The majority of comments urged FDA to retain the current labeling for irradiated foods. Some comments suggested alternate wording, such as “cold pasteurization,” or “electronic pasteurization,” while other comments contended that these terms serve only to obscure information and confuse consumers. A few comments stated that additional labeling, such as “irradiated to kill harmful bacteria,” was helpful.

To better assist FDA in formulating specific revisions that would accomplish the objectives outlined in the FDAMA Joint Statement and also satisfy the requirements of the act, the agency, in addition to publishing the ANPRM, conducted focus group research in Maryland, Minnesota, and California, during June and July 2001. The primary focus of the research was to ascertain from focus group participants how they viewed the current irradiation disclosure statement. We were particularly interested in whether the focus group participants perceived the current irradiation disclosure statement as a warning. The focus group data indicated that the majority of participants were uncertain about the safety, effectiveness, and appropriateness of irradiated food products and greatly desired more information. Most of the participants viewed alternate terms, such as “cold pasteurization” and “electronic pasteurization,” as misleading, because such terms appeared to conceal rather than to disclose information. Participants did not see the current disclosure labeling as a warning, per se, because knowledgeable participants considered irradiation to be a positive safety attribute. Less knowledgeable participants, such as those who associated irradiation with things such as x-ray or radiation, wanted more information about the appropriateness of food irradiation. All participants agreed that irradiated foods should be labeled “honestly.”

On May 13, 2002, the President signed into law the FSRIA. The law included two provisions that relate to irradiation labeling. One of these provisions, section 10808, as discussed in the following paragraph, includes new criteria for use of the term “pasteurization” in labeling. The other provision, section 10809, directed FDA to publish for public comment proposed changes to the current regulations relating to the labeling of foods that have been treated by irradiation using radioactive isotope, electronic beam, or x-ray to reduce pest infestation or pathogens. The provision further stated that “[p]ending promulgation of the final rule * * * any person may petition the Secretary [FDA] for approval of labeling, which is not false or misleading in any material respect, of a food which has been treated by irradiation using radioactive isotope, electronic beam, or x-ray.” Section 10809 also requires that, pending issuance of the final rule, “* * * [t]he Secretary [FDA] shall approve or deny such a petition within 180 days of receipt of the petition, or the petition shall be deemed denied, except to the extent additional agency review is mutually agreed upon by the Secretary [FDA] and the petitioner.”

Section 10808 of the FSRIA, which includes new criteria for use of the term “pasteurized” in labeling, revised section 403(h) of the act to provide that a food may purport to be or be represented as pasteurized if the food has been subjected to a safe process or treatment that is prescribed as pasteurization for such food in a regulation issued under the act or the food has been subjected to a safe process or treatment that meet certain criteria. The criteria prescribed in section 10808 of the FSRIA are that the food has been subjected to a safe process that: (1) Is reasonably certain to achieve destruction or elimination in the food of the most resistant micro-organisms of public health significance that are likely to occur in the food, (2) is at least as protective of the public health as a process or treatment prescribed by regulation as pasteurization, (3) is effective for a period that is at least as long as the shelf life of the food when stored under normal and moderate abuse conditions, and (4) is the subject of a notification to the Secretary (FDA) that includes effectiveness data regarding the process or treatment and at least 120 days have passed after receipt of such notification without the Secretary making a determination that the process or treatment involved has not been shown to meet the requirements.

As part of FDA's implementation of section 10809 of the FSRIA, FDA issued a guidance document entitled “Guidance; Implementation of Section 10809 of the Farm Security and Rural Investment Act of 2002, Public Law No. 107-171, section 10809 (2002) Regarding the Petition Process to Request Approval of Labeling for Foods That Have Been Treated by Irradiation” (the 2002 Guidance). The 2002 Guidance was issued in accordance with FDA's Good Guidance Practices regulation in 21 CFR 10.115. The 2002 Guidance also advised how interested parties may petition the agency for the approval of labeling that may be used on irradiated food as an alternative to the currently required irradiation disclosure statement. FDA noted that this was an interim process and that it could be used until FDA published any final regulation on this issue. FDA published a notice in the Federal Register announcing the availability of the 2002 Guidance document on October 7, 2002 (67 FR 62487). To date, FDA has not received any petitions requesting the use of alternative labeling for irradiated foods.

FDA's authority to require labeling of all foods 1 , including irradiated foods, derives from sections 201(n) and 403(a)(1) of the act (21 U.S.C. 321(n) and 343(a)(1)). In addition, section 701(a) of the act (21 U.S.C. 371(a)) authorizes FDA to issue regulations for the efficient enforcement of the act. Under section 403(a)(1) of the act, a food is misbranded if “its labeling is false or misleading in any particular.” Section 201(n) of the act mandates that, in determining whether labeling is misleading, FDA take into account, among other things, whether the labeling fails to reveal facts that are material in the light of representations made or suggested or with respect to consequences that may result from the use of the product to which the labeling relates under the conditions of use prescribed in the labeling or under such conditions of use as are customary or usual.

Historically, the agency has generally interpreted the scope of the materiality concept to mean information about the characteristics of the food. FDA has required special labeling on the basis of it being “material” information in cases where the absence of such information leads the consumer to assume that a food, because of its similarity to another food, has nutritional 2 , organoleptic (e.g., taste, smell, or texture), or functional (e.g., storage) 3 properties of the food it resembles when in fact it does not. For example, the labeling of margarine that has been processed in a way that results in it no longer being suitable for frying must disclose this difference from regular margarine.

Irradiation has various effects on foods that may cause changes in the characteristics of the food. Such changes may occur in the food's organoleptic, nutritional, or functional properties that would not be noticeable at the point of purchase but could be apparent when consumed or cooked. If these changes are not within the range of characteristics ordinarily found in such foods, they would be considered “material” under this proposal. In the absence of appropriate labeling disclosing these changes in the characteristics of the food, consumers would not have all of the necessary information needed to make a purchase decision or properly use the food. Thus, in the absence of information about these changes in the characteristics of the food, the labeling would be misleading under 201(n) of the act and the food would be misbranded. These changes are typically process specific and will vary with the food and the irradiation conditions. In addition, these changes and the degree of the changes may be measurable and of consequence to consumers. Thus, a blanket statement on when labeling would be required due to irradiation causing material changes cannot be made in advance for all products. Rather, the need for labeling must be determined on a case-by-case basis by appropriate testing of the food irradiated under specific conditions, e.g., time and dosage, because the effect of irradiation on the properties of concern depends on the particular food.

Under the proposal, the fact that a food has been irradiated would not by itself require disclosure on the label. FDA is proposing to require that only those irradiated foods in which irradiation causes a material change in a food's characteristics (e.g., organoleptic, nutritional, or functional properties) under the conditions of use prescribed in the label and labeling or under customary or usual conditions of use bear the radura logo. Those irradiated foods must also bear the term “irradiated” or any derivative thereof (e.g., “irradiate,” “irradiation,” “radiation,” etc.) in conjunction with language describing the material change. Additionally, FDA will not object to the use of additional terms to indicate that a food has been subjected to the process of irradiation, e.g., “treated with radiation,” “treated by irradiation,” or “processed with radiation.” However, in the absence of a material change, under the proposal, the fact that the food has been irradiated is not considered a material fact and, therefore, no logo or label statement would be needed. For such foods, FDA would not object to manufacturers voluntarily labeling their products to indicate that the food is irradiated. FDA is also proposing to allow the use of alternate terms to “irradiated” or any of its derivatives if use of the term has been approved by FDA in response to a citizen petition submitted in accordance with § 10.30 (21 CFR 10.30).

As discussed in more detail in section I of this document, the FSRIA amended section 403(h) of the act to include new criteria for the use of the term “pasteurized” in labeling. This section gives FDA authority to determine for labeling purposes whether alternate processes, e.g., irradiation, are equivalent to pasteurization in destroying pathogens. Therefore, FDA is also proposing to require that anyone seeking to label a food as “pasteurized” under this provision in lieu of referring to irradiation must notify FDA and provide supportive data. Provided the agency has not objected to the notification within 120 days after receipt of the notification, the notifier would be able to label a food as “pasteurized” in lieu of “irradiated.”

Under section 409 of the act, no food may be irradiated without approval by FDA. Currently, FDA has approved irradiation for a number of foods, including spices, shell eggs and fruits and vegetables, although only a small fraction of these foods are actually irradiated. According to a report by the U.S. General Accounting Office 4 (2000), only 0.005 percent of fruits and vegetables consumed in the United States (about 1.5 million pounds), and 9.5 percent of all spices consumed in the United States (about 95 million pounds of spices and dry or dehydrated aromatic vegetable substances) are irradiated annually. See the following Web site for a listing of all foods that have been approved for irradiation: http://a257.g.akamaitech.net/7/257/2422/10apr20061500/edocket.access.gpo.gov/cfr_2006/aprqtr/21cfr179.26.htm .

As previously discussed in section II.A of this document, irradiation has various effects on foods that may change a food's characteristics. For example, as with other forms of processing, the effects of irradiation that kill or weaken insects and microorganisms may also cause some changes in the food itself. Many of these changes are of little significance, as the composition of the food will remain within normal variations of unirradiated foods. However, other changes to organoleptic, nutritional, and functional properties may occur. Changes to shelf life are likely to be among the most common of these changes. Bananas and spices are illustrative of irradiated foods that may have an extended shelf life and are discussed in the following paragraph.

Bananas may be irradiated to delay ripening and extend shelf life. This is an example of a material change. Consumers have a general idea of the shelf life and ripening time of unirradiated bananas based upon their appearance and make purchase decisions based at least in part on the bananas' appearance (i.e., ripeness) and intended use. If irradiated bananas were not labeled to indicate the material change, e.g., delayed ripening, consumers would purchase the bananas expecting the faster ripening schedule of unirradiated bananas. A consumer who wanted to make a food that required very ripe bananas (e.g., banana bread) would not know, without labeling, that the irradiated bananas would not be ripe enough to make the banana bread when he wanted to do so. Thus, if the irradiated bananas are not labeled, the consumer might purchase the bananas and then discover later that they are unsuitable for the consumer's planned use.

In contrast, there are instances where treatment with irradiation may extend a food's shelf life without changing any of its functional characteristics in a way that may require using the food differently than its unirradiated counterpart. For example, while spices that are irradiated to control microbial growth will likely have their shelf life extended, FDA tentatively believes that the extension in shelf life in this case does not have the potential to be detrimental to the consumer (e.g., to prevent the consumer's planned use of the food) because the irradiated spice can be used identically to an unirradiated spice. That is, in addition to possibly benefiting from the extended shelf life, a consumer buying the irradiated spice can use the irradiated spice the same as he would the unirradiated spice. Unlike the consumer of irradiated bananas described above, the spice consumer does not need additional information to prevent the potential for a detrimental consequence from using the irradiated food the same as its unirradiated counterpart. Thus, FDA tentatively believes that the extension of a spice's shelf life due to irradiation would not be material information that consumers need to know; therefore the producer would not be required to declare this information on the spice label. We request comment on the utility, for purposes of labeling, of distinguishing between those changes to a food's functional properties from irradiation that may make a food unsuitable for a particular use (e.g., delayed ripening) and those changes that still allow for the food to be used identically to one that is not irradiated (e.g., extension of shelf life alone).

One of the goals of food science research on irradiation is to determine irradiation conditions that would minimize those unexpected effects that would be material to consumers. In a review article on the effects of irradiation on fresh-cut fruits and vegetables, Prakash and Foley (Ref. 1a) cite research illustrating how effects can vary depending on the food, irradiation conditions, and mitigating steps that can be taken. They report that in some cases low doses can cause significant loss in firmness; however, in other fruits and vegetables no such loss is observed, even at a higher dose. For example, firmness of diced Roma tomatoes irradiated at 0.5 kilogray (kGy) decreased by 30 percent and firmness of cut romaine lettuce irradiated at 0.35 kGy decreased by 10 percent. However, no change in firmness was observed in shredded carrots or fresh-cut iceberg lettuce following irradiation at 1 and 2 kGy, or in celery irradiated at 1 kGy. In diced bell peppers, irradiation at 3.7 kGy reduced bell peppers' flavor and produced some off-flavors, while no effect on flavor or aroma was perceived in a control group of bell peppers that were not irradiated and in peppers irradiated at 1.32 kGy. Additionally, after storage for 9 days, off aroma was significantly higher in the control sample of bell peppers than in the two groups of irradiated peppers, coinciding with a slimy appearance attributed to microbial spoilage. Prakash and Foley also report that combining irradiation with other technologies, such as calcium treatment, warm water dips, and modified atmosphere packaging further mitigated measurable adverse effects on quality. Similarly, Kader (Ref. 1b) reported that fruits and vegetables such as papaya, strawberry, tomatoes, and dates have a high tolerance to irradiation at doses (below 1 kGy) used for insect control, while cucumber, green bean, grape, and lemon have a low tolerance at this same kilogray. Thus, whether effects occur that would change the food in a significant way will depend on the particular food that is irradiated and the dosage of irradiation used. In its decision approving the use of radiation on shell eggs, FDA cited to data in the petition showing an increased color loss in the irradiated egg yolk and a change in the egg's viscosity as the radiation dose was increased (65 FR 45280 at 45281; July 21, 2000). Such a change in the viscosity or other characteristics of the egg would affect its functionality, e.g., its cooking or binding properties. This change could be significant enough that consumers should be informed of the irradiation and its effect on the food.

In sum, irradiation of food can cause effects in food that are material in light of representations made or on consequences of use. However, whether such effects are sufficient to meet the standard of section 201(n) of the act will vary based on several factors and cannot be determined without considering the particular food and irradiation processing applied. If the change in the irradiated food is within the range of characteristics ordinarily found in such foods, then the fact that the food is irradiated and the resulting change would not be material information and would not be required to be declared on the label.

The use of irradiation is strictly voluntary and generally approved up to a maximum dose. We believe that manufacturers may adjust the dosage to get the most effective dose, while minimizing unexpected effects in the irradiated food. These food manufacturers or producers may choose to irradiate their food only if the irradiation does not alter in a significant way characteristics of the food that are material to the consumer. Thus, it is possible that many uses of irradiation will not result in a material change within the framework set out in this rule. FDA is interested in receiving information about the types of pre-market investigations, e.g., taste test panels or functional studies, done by food manufacturers to evaluate whether to irradiate and at what dose to irradiate in such a way that a material change does not result.

Food is most commonly irradiated to control food-borne pathogens. FDA is not aware of data indicating that control of food-borne pathogens as a result of food irradiation would, by itself, result in a change in the food's characteristics that would not be apparent at the point of purchase of the food and, thus, would have to be disclosed in the labeling of the food to prevent the labeling from being misleading. Consumers expect food to be safe and of a certain quality, and therefore, FDA tentatively concludes that control of food-borne pathogens alone is not an unexpected change in the food. Thus, in instances where a food has been irradiated to enhance or maintain the safety of a food by controlling food-borne pathogens that may be present, and no other changes to the food have resulted, FDA tentatively concludes that information that the food has been irradiated is not necessary to prevent the labeling from being misleading. FDA is interested in receiving any information on whether the control of food-borne pathogens changes the characteristics of the food in an unexpected way, i.e., outside of the normal variation of the food, and would therefore require additional labeling to inform the consumer of such change. FDA also solicits comments on any specific changes that might be caused by irradiation that might constitute non-material changes.

On the other hand, there may be situations in which irradiation to control food-borne pathogens has had other effects on foods, such as changes to organoleptic, nutritional, or functional properties which would not be readily apparent to the consumer. In such situations, information that there are changes in the characteristics of the food as a consequence of irradiation is the material information that is required in labeling in keeping with the act, to prevent the labeling from being misleading. Further, with regard specifically to shelf life, FDA recognizes that irradiation to control the growth of food-borne pathogens may have the unintended effect of extending shelf life. We specifically request comment on the effect of irradiation on shelf life and the extent of any relationship between control of food-borne pathogens and extension of shelf life.

In the past, FDA policies on irradiation labeling have focused on the fact that the food has been processed. In the preamble to the 1986 final rule, we stated that “* * * irradiation may not change the food visually so that in the absence of a statement that a food has been irradiated, the implied representation to consumers is that the food has not been processed” (51 FR 13376 at 13388). FDA concluded that, to prevent deception, the fact that the irradiated food is processed is material information that is required to be disclosed on the label. Thus, FDA required in § 179.26(c) (21 CFR 179.26(c)) that, in addition to the radura logo, the label and labeling of irradiated foods bear the statement “Treated with radiation” or “Treated by irradiation.”

In recent years, FDA policies on the labeling of foods have focused on the results of the processing of the food rather than the processing itself. As discussed earlier, although foods that have been irradiated have been processed, the irradiation does not always result in a material change in the food or in the consequences of use. Further, FDA consumer research indicates that information provided to consumers on the labels of foods is more meaningful if it describes the purpose of the irradiation (Ref. 2). FDA recognizes that labeling to inform the consumer that the product has been irradiated does not, in itself, inform the consumer if or how the product is materially changed. Thus, FDA tentatively believes that when the irradiation causes a material change in the characteristics of the food, the consumer needs to know about this change, and not just the fact that the food has been irradiated. FDA believes that this information should be provided in a disclosure statement on the label of the irradiated food. The disclosure statement would describe the material change in the properties of the food and give consumers additional information that would enable them to make better informed decisions about whether to purchase an irradiated food.

Therefore, FDA is proposing to amend § 179.26(c)(1) and (c)(2) to require that only those foods that have been treated with radiation, and in which the irradiation caused a material change in the characteristics of the food must bear the radura logo and the term “irradiated,” or other derivatives as discussed previously in section II.A in conjunction with explicit language describing the change in the food or its conditions of use (e.g., “irradiated to inhibit sprouting”). In addition, as noted in the 1986 final rule (51 FR 13376 at 13391), FDA believes that the logo is still a necessary part of the label statement because it derives from the symbol that has been used internationally to convey the fact that the food has been irradiated. FDA tentatively concludes that this approach is appropriate because it would require that consumers be provided with more precise information about the material change in the characteristics of the food than what is currently required. As noted previously, such material changes may affect how products are stored and subsequently used by consumers, as well as whether or not the products are purchased in the first place. However, FDA requests comments on whether the term that describes the process, e.g., “irradiated” or an alternate term such as “pasteurized,” is a necessary part of the label statement to ensure that consumers completely understand the statement.

As previously discussed in section I.D of this document, section 10809 of the FSRIA provides that anyone requesting approval of alternative labeling for a food that has been treated by irradiation, may petition FDA. As discussed in the 2002 Guidance, FDA believes that it is appropriate to use the citizen petition process provided in § 10.30. This regulation requires the petitioner to submit to the agency all relevant information regarding the petition. This relevant information includes both the information and views upon which the petitioner relies and the information known to the petitioner that is unfavorable to the petitioner's position. Thus for these purposes, relevant information would include any data known or relied upon by the petitioner (e.g., qualitative or quantitative consumer research), that show consumer understanding of the purpose and intent of the proposed alternative labeling. FDA believes that such information might include, but is not limited to, the following information: (1) Data on consumers' prior assumptions about, and perceptions of, the product characteristics in light of the proposed labeling statements and (2) data on consumer acceptance and comprehension of the proposed labeling statements in comparison to consumer acceptance and comprehension of the irradiation statement required by the current regulation (§ 179.26(c)(1)). Also, as noted in section I.D of this document, section 10808 of the FSRIA revised section 403(h) of the act to permit the use of the term “pasteurized” on labels of foods that have been subjected to a safe process as long as the process meets certain criteria.

Therefore, we are proposing in § 179.26(c)(1) to permit the use of alternate terms to “irradiated” or any of its derivatives, on the labels and labeling of irradiated foods. We are proposing in § 179.26(c)(2) that the alternate term may be used on the labels and labeling of foods that have been treated by irradiation, that is, if use of the term has been approved by FDA in response to a citizen petition submitted in accordance with § 10.30. In the case that the alternative term is “pasteurized,” the irradiation process must meet the criteria of section 403(h)(3) of the act. Anyone seeking to label a food as “pasteurized” under this provision must notify FDA and provide effectiveness data regarding the process or treatment used. The agency intends to issue guidance to interested parties who wish to notify the agency to use the term “pasteurized” in accordance with section 403(h)(3) of the act.

FDA and the Food Safety and Inspection Service (FSIS), U.S. Department of Agriculture, entered into a memorandum of understanding (MOU) establishing procedures to jointly respond to petitions to use food ingredients and sources of irradiation in the production of meat and poultry products (see 64 FR 72168, December 23, 1999, at http://www.fsis.usda.gov/OPPDE/rdad/FRPubs/88-026F.pdf ; for the MOU, see http://www.fsis.usda.gov/Regulations_&_Policies/Labeling_FDA_MOU/index.asp ). FSIS has separately issued regulations at 9 CFR 424.22(c) regarding the irradiation of meat and poultry products (see 64 FR 72150, December 23, 1999, at http://www.fsis.usda.gov/OPPDE/rdad/FRPubs/97-076F.pdf ).

FDA has examined the economic implications of this proposed rule as required by Executive Order 12866, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Executive Order 12866 classifies a rule as significant if it meets any one of a number of specified conditions, including: having an annual effect on the economy of $100 million or more or adversely affecting in a material way a sector of the economy, competition, jobs, the environment, public health, or safety, or State, local, or tribal governments or communities. A regulation also is considered a significant regulatory action if it raises novel legal or policy issues. We have determined that this rule is a significant regulatory action as defined by Executive Order 12866 because it raises novel policy issues.

Executive Order 12866 states, “Federal agencies should promulgate only such regulations as are required by law, are necessary to interpret the law, or are made necessary by compelling need, such as failures of private markets to protect or improve the health and safety of the public, the environment, or the well being of the American people.”

As previously discussed in section I.D of this document, on May 13, 2002, the President signed into law the FSRIA, which contains a provision relating to irradiation labeling. Section 10809 directs FDA to publish a proposed rule and, with due consideration to public comment, a final rule to revise the current regulation governing the labeling of foods that have been treated by irradiation. This rule is proposed not to address any market failure, but to respond to section 10809 of FSRIA and because we tentatively believe that it may no longer be necessary to require that all irradiated food be labeled as such.

We analyzed five options for the proposed irradiation regulation:

• No new regulatory action (current state of the world, baseline).

• Remove labeling requirements for irradiated foods.

• Maintain the current labeling requirement (that is, all food that is irradiated must be labeled), but also require statements of purpose (e.g., “Irradiated to extend shelf life”).

• Maintain the current labeling requirement, but also allow alternate terms to irradiation (e.g., “pasteurized”).

• The proposed regulation—Only those foods treated with irradiation and for which the irradiation caused a material change in the food must bear the radura logo and the term “irradiated” or an alternate term such as “pasteurized” in conjunction with explicit language describing the change in the food or its conditions of use (e.g., “irradiated to inhibit sprouting”). A food undergoes a material change if irradiation changes the properties of the food in a way that is not readily apparent to the consumer at the point of purchase. Therefore, in the absence of a material change, the fact that the food was irradiated is not considered a material fact and, therefore, no radura logo or label statement would be needed.

Option 1: No New Regulatory Action (baseline).

Taking no new regulatory action on irradiation labeling is option 1 in our analysis. The FSRIA requires FDA to publish a proposed rule and, with due consideration to public comment, a final rule to revise the current irradiation labeling regulation. So this is not a viable option. We include it here because the Office of Management and Budget (OMB) cost-benefit analysis guidelines recommend discussing statutory requirements that affect the selection of regulatory approaches. These guidelines also recommend analyzing the opportunity cost of legal constraints that prevent the selection of the regulatory action that best satisfies the philosophy and principles of Executive Order 12866. This option will serve as the baseline against which other options will be measured for assessing costs and benefits, and we assume the baseline has zero costs and benefits.

The current regulation (§ 179.26) states that irradiated food must bear the radura logo and the phrase “Treated with radiation” or “Treated by irradiation” and does not explicitly address the inclusion of additional information that directs attention to shelf life or food safety. Currently, FDA has approved iradiation for a number of foods including spices, shell eggs, and fruits and vegetables; however, only limited amounts of irradiated foods are sold in the United States. According to a report by the General Accounting Office 5 (2000), it is estimated that 97 million pounds of food products are irradiated annually (including “meat food products” under the Federal Meat Inspection Act and “poultry” under the Poultry Products Inspection Act 6 , which are regulated by the United States Department of Agriculture), which is only a small fraction of the total amount of food consumed. For example, about 1.5 million pounds of fruits and vegetables are irradiated annually. This represents only 0.005 percent of the total amount of fruits and vegetables consumed. About 95 million pounds of spices and dry or dehydrated aromatic vegetable substances are irradiated annually, which represents 9.5 percent of all spices consumed. Because spices, shell eggs, fruits and vegetables account for virtually all the food irradiation done in the United States, we use only data about those foods in our economic analysis.

Option 2: Propose to remove labeling requirements for irradiated foods

This option also may not be viable because it could violate section 403(a) of the act, which provides that the labeling of all foods, including irradiated foods, must be truthful and not misleading. In addition, section 201(n) of the act mandates that, in determining whether particular labeling is misleading, FDA consider whether the labeling fails to reveal material facts in light of representations made, or with respect to, the consequences that may result from the use of the product. Having no labeling requirements might violate these provisions. If this option were chosen, costs and benefits would be generated if many firms ceased labeling their irradiated products.

Costs : Since this option would not require labeling, search costs would increase for purchasers who do not want irradiated food. There will be an increase in search costs because these consumers would need to increase efforts to find information about irradiated foods other than on the labels or in the labeling, or obtain knowledge of producers who irradiate their food products. If firms decide to drop labeling, they would incur relabeling and label inventory costs but they would choose the least costly labeling option.

Benefits : This option could be beneficial to those firms currently labeling irradiated food by allowing them to reclaim label space on the label for private purposes, such as marketing messages or label art. Without a labeling requirement, it is possible that irradiation would become more attractive to firms because of this benefit. Any increases in the numbers of irradiated foods could, in turn, result in increased food safety or shelf life.

Option 3 : Maintain the current labeling requirement (i.e., require that all irradiated food be labeled “Treated with radiation” or “Treated by irradiation,” along with the radura logo), but propose to also require statements of purpose (e.g., “Treated with irradiation to inhibit sprouting,” etc.).

The current regulation (§ 179.26(c)) states that irradiated food must bear the radura logo and the phrase “Treated with radiation” or “Treated by irradiation.” The current regulation does not explicitly address the inclusion of additional information that directs attention to, for example, shelf life or food safety. This option would amend the current regulation to include explicit requirements on inclusion of additional information on irradiation benefits. While it is possible that some firms that irradiate food currently include statements of purpose, this option would formally require this inclusion.

Costs : This option would generate costs because firms would be required to relabel their products in order to include statements of purpose. Tables 1 and 2 of this document outline estimated labeling costs for sectors of the food industry that may require relabeling. The food categories included in the table are currently approved for irradiation by FDA.

Table 1 outlines low, medium, and high cost estimates based on a change in the principal display panel. Table 2 outlines low, medium, and high cost estimates based on a change in the information panel or assuming that the irradiation statement is similar in cost to a nutrient content claim or health claim. It is not certain which table most likely represents costs to firms because it is not certain what conditions would make the costs in table 1 more likely or what conditions would make table 2 more likely. Both tables show estimated costs under compliance periods of 12, 24, and 36 months. In both tables 1 and 2, compliance costs decrease as the length of compliance period increases for all product categories because firms can coordinate new changes in labels with already-scheduled changes in labels. In addition, the compliance period affects whether or not firms would incur additional labor costs, such as overtime, and the volume of labeling inventory that would have to be discarded as a result of a new rule.

Cost estimates are shown in two proportions for each compliance period: If 1 percent of the industry irradiates and if 5 percent of the industry irradiates. As can be seen in the tables, industry costs decrease as the number of firms irradiating food decreases. Data on the actual number of firms that irradiate food or will want to irradiate food in the future are not currently available. The agency requests comments on the number of firms or products that would be affected by a new irradiation labeling rule.

The cost model used in this analysis does not include costs for labeling fresh produce without packaging because fresh fruits and vegetables do not have Universal Product Codes that can be scanned. Nonetheless, it is still necessary to estimate costs associated with labeling fresh fruits and vegetables that have been irradiated.

One way of labeling fresh fruits and vegetables is by placing stickers on the produce. While it is not known how many fruit and vegetable manufacturers irradiate or will want to irradiate as a result of this rule, according to the 2002 Census of Manufacturers (Ref. 8), there are 5,836 firms that process fresh fruits and vegetables. As with costs estimates for the other food categories, it is assumed that 1 percent of these firms, or 58, may want to irradiate, or 5 percent of these firms, or 292, may want to irradiate. Our 1 percent and 5 percent assumptions are based on the generally observed very low rate of adoption of irradiation technology in food processing to date. We do not have specific data to estimate the number of firms that will irradiate if this rule is finalized, and we request comment on this assumption.

For firms, there are administrative costs involving the establishment of what the sticker will look like, as well as the costs of finding the printer to produce these stickers. Based on previous estimates of similar costs in the final rule on the Labeling of Juice Products (63 FR 24254; May 1, 1998), the agency estimates these administrative costs to be $100 per firm. In addition, printers levy one time charges for set-up in addition to the basic per unit cost of labels. The agency estimates these costs to be $250 per firm. Table 3A summarizes administrative costs associated with using stickers if 1 percent of the industry irradiates and if 5 percent of the industry irradiates.

In addition to administrative costs, there are labor costs associated with affixing stickers to the fruits and vegetables. The agency estimates the labor cost of applying the labels by multiplying the average agricultural hourly wage ($10.75) (Ref. 8a) by the approximate number of hours needed to label the irradiated fruits and vegetables. Assuming it takes one worker 1 hour to label 240 pounds of fruits or vegetables (4 pounds per minute multiplied by 60 minutes) it would take approximately 6,250 hours to label 1.5 million pounds of fruits and vegetables, the approximate amount of fruits and vegetables irradiated annually in this country. The total labor costs associated with labels would then be $67,188. Table 3B summarizes total labor costs if one worker can label 240 pounds per hour, 360 pounds per hour or 480 pounds per hour. The agency requests comments on costs associated with labeling fresh fruits and vegetables that have been irradiated.

Benefits : A statement regarding the purpose of irradiation would serve to provide more information to consumers than what is currently on the label. To the extent that the addition of the statement of purpose causes people to purchase irradiated products they may have previously avoided, and to the extent that these products have longer shelf life or lower risk of illness, then consumers will benefit. Consumers may look more favorably on irradiated food once they understand the purpose, which in turn, could result in more irradiated food in the market due to the increase in demand. Information may also be a benefit in itself even if purchases do not increase. Research indicates that providing a statement of purpose results in a more positive attitude by consumers toward the purchase of irradiated food (Ref. 3). Furthermore, research indicates that providing information about the benefits of irradiation may increase willingness of consumers to pay for irradiated food (Ref. 4).

Option 4: Maintain the current labeling requirement, but propose to also allow alternate terms to “Irradiation” (e.g., “Pasteurized”)

The current regulation (§ 179.26(c)) states that irradiated food must bear the radura logo and the phrase “Treated with radiation” or “Treated by irradiation.” Currently, no alternate terms to irradiation are allowed. This option would maintain the requirement that irradiated food must be labeled but allow the label to contain terms other than “irradiated,” such as “pasteurized.” But the term “pasteurized” may be used only if the process meets the definition as provided in section 403(h)(3) of the act.

Costs : This option generates costs because some firms would opt to relabel their products, but it is uncertain how many firms would do this because this option would be voluntary. However, firms would only relabel if they thought doing so would increase profits. Tables 1 and 2 contain cost estimates for the main food categories that may be affected by this option. It is probable that firms would select a 24 to 36 month compliance period to keep costs down by coordinating the relabeling with regular labeling changes.

In the short run, there may be increased consumption of irradiated food if those consumers who do not want irradiated food do not equate the alternative term with irradiation. Also, confusion could result from the use of alternative terms with uncertain meanings, causing some consumers to increase search costs. Research indicates that many consumers regard substitute terms for irradiation to be misleading (Refs. 2 and 5). In the long run (defined here as a time period long enough for consumers to adjust to and understand the meaning of the alternate terms), consumers' distaste for the term “irradiation” would extend to alternate terms used in labeling, especially if there is no additional statement of purpose. Once consumers understand that the alternate terms all mean “irradiation,” the result would likely be a return to the baseline number of irradiated products and labels.

Benefits : It is possible that, in the short run, consumers will not understand that the alternate terms mean the same as “irradiation.” However, to the extent that the substitution of terms induces consumers to buy relabeled food that they may have previously avoided and to the extent that these products benefit them in terms of safety or longer shelf life, then consumers will benefit from the substitution of terms. In the short run, the quantity of irradiated food supplied may increase in response to increased demand. As previously mentioned, the long run outcome may be the same as the baseline because, over time, consumers will come to understand that any alternate terms have the same meaning as “irradiation.” Once consumers understand that the alternate terms have the same meaning as “irradiation” they may want to discontinue consumption of the food, resulting in the number of irradiated foods returning to the same number as before the change in terms. This is a result of producers responding to the change in demand by reducing the quantity of irradiated food supplied.

Option 5: The Proposed Regulation

Only those foods treated with irradiation, and in which the irradiation caused a material change in the food such that it would change the characteristics of the food in a way that is not readily apparent to the consumer at the point of purchase must bear: (1) The radura logo and (2) the term “irradiated” or a derivative thereof, or an alternate term such as “pasteurized,” in conjunction with explicit language describing the change in the food or its conditions of use (e.g., “irradiated to inhibit sprouting”). If a firm chooses to use an alternate term to “irradiation” other than “pasteurized,” it must submit a petition to the Secretary (FDA). If a firm wishes to use the term “pasteurized,” it must submit a notification including effectiveness data regarding the process or treatment to the Secretary (FDA).

This option deviates from the current regulation (§ 179.26(c)) in two major ways. First, this option would require irradiation labeling only for food items treated with irradiation if irradiation causes a material change in the food or consequences that may result from use of the food. Secondly, this option requires explicit language describing the material change and allows use of alternate terms for irradiation, as long as a petition is approved by the agency or, in the case where “pasteurized” is used, a notification is sent to FDA to which the agency does not object. This option allows for more labeling flexibility and it is possible that the radura logo and label statements on some irradiated food, as long as the irradiation caused no material change, could be removed. The number of products that could be marketed without irradiation labeling is uncertain because labeling requirements cannot be made in advance for all products. Rather, the need for labeling must be determined on a case-by-case basis by appropriate testing of the food irradiated under specific conditions, i.e., time and dosage, because the effect of irradiation on the properties of concern depends on the particular food. It is more likely that this option would simply allow firms more flexibility in how they label irradiated food.

Costs : This proposed rule generates costs because it requires firms to relabel some irradiated products. As with other options, Tables 1 and 2 contain cost estimates for relabeling in selected food categories. Note that cost estimates take into account all relabeling costs, including the costs of removing irradiation label statements. The requirement of a material change could reduce the number of products that would need to be labeled, so some firms would be able to remove current irradiation labeling. This rule would generate additional costs because, in order for a firm to be able to use an alternative to the term “irradiation,” a firm would have to submit a petition to the agency (as addressed in proposed § 179.26(c)(2)(i)). If it is the case that the desired alternate term is “pasteurized,” then, instead of submitting a petition, a firm must notify the agency and also submit effectiveness data on the method used in its process (as addressed in proposed § 179.26(c)(2)(ii)). Firms are not required to use an alternate term. It is assumed that a firm would choose to use an alternate term only if doing so would increase profits.

Based on previous estimates of the cost to prepare a petition or notification, FDA is assuming the average cost to prepare a petition or notification is $84 per hour (Ref. 13). The agency estimates the total cost of a petition or notification as the time needed to prepare the notification or petition multiplied by $84, the approximate cost associated with the person for preparing the notification or petition. In the case where a firm wants to use the term “pasteurized,” the agency does not assume this rule generates any additional cost of gathering effectiveness data; that is, presumably the firm will already have data on the effectiveness of its method, or it would not undertake the cost of irradiation. As mentioned earlier, it is not known how many firms that currently irradiate or will irradiate in the future will be required to label a product as irradiated, and will desire to use an alternative to the term “irradiation.” Therefore, the cost estimates are based on an estimate of the number of firms manufacturing foods that are currently approved for irradiation choosing to submit a notification or petition.

Table 4 of this document contains the initial cost estimates of preparing a notification or petition. The number of firms is based on the 2002 Census of Manufacturers (Refs. 6, 7, and 8). According to the Census of Manufacturers, there are 275 companies that manufacture spices and extracts, 311 companies that process poultry and shell eggs (the Census of Manufacturers groups poultry and shell egg processing together), and 5,836 firms that process fresh fruits and vegetables, for a total of 6,422 firms. It is possible that 1 percent of, or 64 firms in the industry will want to use an alternate term and it is possible that 5 percent of, or 321 firms in the industry will want to use an alternate term. The average of this range is 193 firms.

Table 5 of this document presents cost estimates of the annual reporting burden for additional product notifications or petitions after the initial compliance period due to, for example, new firms entering into the industry. It is assumed that one petition to use an alternate term other than “pasteurized” will be submitted per year. The time estimates for both tables 4 and 5 are taken from section IV of this document. We estimate that the annual notifications would be about 10 percent of the initial number, that is, 10 percent of 193 (the estimate in table 4), or 19 firms.

If irradiation causes no material change in the food, irradiation labeling would be removed under this option. Removing irradiation labeling could cause increases in search costs for consumers who desire to avoid purchasing irradiated goods and must find alternative sources to maintain knowledge of producers that irradiate their products.

Some producers may alter their products' labels to use a term other than irradiated (e.g. “pasteurized”). However, it is uncertain how many producers would use alternate terms. Again, the use of alternative labels would generate potential costs because some consumers may wish to avoid irradiated products. As mentioned before, research indicates many consumers regard substitute terms for irradiation to be misleading (Refs. 2 and 5). These individuals would have to increase their search efforts in order to continue to be informed about approved alternate terms to irradiation. We request comment on the potential for this proposed rule if finalized to increase search costs, particularly for consumers and retailers who desire non-irradiated foods.

Benefits : This proposed rule generates benefits because it could allow consumers to make more informed decisions about the food they purchase. If the addition of a statement of purpose causes people to buy relabeled irradiated products that they may have previously avoided and if these products have, for example, longer shelf life or lower risk of illness, then consumers will benefit. If, as a result of this proposed rule, consumers look more favorably on irradiated foods, the supply of such foods may increase. If retailers are more willing to carry relabeled irradiated products, then consumers benefit from the added opportunity to buy these products.

As mentioned in the costs section of this option, if irradiation causes no material change, it is possible that some products would no longer have to bear the irradiation label statement or the radura logo, but it is uncertain how many products would fall into this category. For producers who voluntarily choose the no-label option, private benefits exceed private costs, since they no longer are required to continue with the existing labeling. That is, a firm would choose the no-label option if it believes doing so will increase profits. Reiterating the idea that the supply of irradiated food may increase as a result of this rule, it is possible that some manufacturers not currently using irradiation as a safety tool (because of the current labeling requirement) may opt to start using irradiation in order to enhance the safety of their products, if there is no material change in the product. Again, firms will only start using irradiation if they believe doing so will increase profits. As already pointed out, however, there are potential search costs for some customers.

This analysis also applies to those firms who choose alternate terms for irradiation. Private benefits will exceed private costs for firms that voluntarily choose alternate terms for irradiation, because they will no longer be required to continue using existing labeling. These firms will only choose alternate terms to irradiation if they believe doing so will increase profits. Again, this use of alternate terms can result in the previously mentioned increase in search costs for consumers who desire to avoid irradiated goods.

If the removal of explicit language indicating that a food has been irradiated causes people to buy irradiated products that they previously avoided, and if these products have lower prices or higher quality, then some consumers will benefit from the removal of information. Also, if retailers are more willing to carry unlabeled irradiated products at lower prices, then all consumers benefit from the lower prices. But it is uncertain that unlabeled irradiated products will be offered for lower prices than products that are not irradiated, because the irradiation process itself is not costless. If irradiation increases product quality but also increases the cost of production, then prices of irradiated products could be higher than the same non-irradiated products, with or without labels.

Table 5A of this document summarizes the costs and benefits of each option analyzed. Costs are given based on the assumption that 1 percent of firms irradiate and relabel (at the medium cost level) using a 2-year compliance period if the option requires relabeling and a 3-year compliance period if relabeling is permitted voluntarily. For Option 5, it also assumes that 1 percent of firms prepare a notification to use the term “pasteurized” in the first year and 1 firm petitions to use another alternative term in the first year. The range of costs represents our uncertainty about the need for changes to the principal display panel or the information panel and the number of pounds of fresh fruits and vegetables that can be stickered per hour. For Option 5, the quantified costs are likely to be less than listed because some firms would be able to remove the irradiation labeling when it results in no material change when it is least costly for them to do so and will not need to submit notifications or petitions.

We request comments on the estimates for these options and specifically on the following three issues:

1. The number of firms or products that would be affected by a new irradiation rule.

2. The number of firms that would begin irradiating products as a result of the various options described here.

3. Whether some industry sectors should be given more time to comply than others to reduce the economic impact on them.

FDA has examined the economic implications of this proposed rule as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). If a rule has a significant economic impact on a substantial number of small entities, the Regulatory Flexibility Act requires agencies to analyze regulatory options that would lessen the economic effect of the rule on small entities. It is not known how many small firms currently irradiate food or will want to irradiate food. If small firms are using this technology, this proposed rule may have a significant economic impact on a substantial number of small entities. The agency requests comments on how this proposed rule will impact small firms.

Under contract, Eastern Research Group developed a model framework for estimating regulatory impacts on small businesses. The model is designed to accommodate a variety of potential regulatory activities, ranging from Hazard Analysis Critical Control Point (HACCP) to product labeling.

Using the 2002 Economic Census and other data, the model estimates the cash flows of representative establishments of varying class sizes of food manufacturers. Based on post-regulation cash flow and distribution of income for each model facility, the model generates the percentage of facilities in each model class that are vulnerable to closure. The model allows the agency to (1) Predict the probability and frequency of small business failure as a result of FDA regulations and (2) estimate the effects of various forms of regulatory relief on the survival of small businesses on a per-establishment basis.

Cost estimates produced by the FDA Labeling Cost Model were used to help generate estimates of the average relabeling cost for firms in two of the four food categories examined here: spices/seasonings and dried vegetables. The middle estimated costs in each food category were divided by the estimated affected stockkeeping units (SKUs) in each food category to arrive at average cost per SKU. Affected SKUs per category are then divided by total number of firms in each category to arrive at average number of affected SKUs per firm. The number of firms in each food category comes from the Ready-to-Eat Food Manufacturing Industry category in FDA's Small Business Impact Model (Ref. 9). We use these estimates to calculate cost per firm using the following formula:

Cost/Firm = (Average SKUs per firm) x (Average Middle Relabeling Cost/SKU)

This formula allows us to estimate the approximate average relabeling costs for firms in each food category. Keep in mind these are merely estimates and cost structures are treated identically across firms. That is, we assume that costs for small firms are similar to costs for large firms. The average relabeling costs for compliance periods of 12, 24, and 36 months were then entered into the Small Business Impact Model to estimate the number of firms at risk for negative cash flow, assuming all firms in each category must relabel. The results of these estimates are presented in tables 6 and 6A of this document. The table is divided into two sections, one for estimates if the information panel is affected and another for the principal display panel.

The 1976 Copyright Act, 17 U.S.C. 101, et. seq., carried over provisions for the continued protection of certain works first published or registered for copyright under the 1909 Copyright Act. Reenacting and preserving the provisions of section 24 of the 1909 law for all works which were then in their first term of copyright protection, Section 304(a) of Title 17 as originally enacted in 1976 provided that renewal registration had to be made during the 28th year of the original term of copyright in order to secure the additional (then 47) years of renewal-term protection. 17 U.S.C. 304(a) (1976).

In 1992, Congress enacted a revision of section 304(a) of Title 17 which made renewal copyright automatic for works first published or registered from January 1, 1964, through December 31, 1977. This amendment allowed the renewal right to vest without registration of: [a] the claim to copyright during the original, 28-year term; or, [b] the claim to renewal copyright during the year immediately prior to the beginning of the renewal term ( i.e. , during the 28th year); or, [c] the claim to renewal copyright during the renewal term. Pub. L. No. 102-307, 106 Stat. 264, enacted June 26, 1992. In order to encourage renewal registration and provide a public record of renewal rights, however, Congress also amended section 304(a) to provide certain benefits to a party who undertook the renewal registration within the 28th year of the original term of copyright. These benefits for works with timely renewal registrations include:

1. A certificate of registration constitutes prima facie evidence as to the validity of the copyright during its renewal term and of the facts stated in the certificate. 17 U.S.C. 304(a)(4)(B).

2. A derivative work prepared under the authority of a grant of a transfer or license of copyright in a work made before the expiration of the original term of copyright may not continue to be used under the terms of the grant during the renewal term without the authority of the owner of the renewal copyright. 17 U.S.C. 304(a)(4)(A).

3. A renewal copyright vests upon the beginning of the renewal term in the party who was entitled to claim the renewal of copyright at the time the application was made as provided under 17 U.S.C. 304(a)(2)(A)(i) and (B)(i).

Registration of a claim to the renewal term has also been possible since the 1992 amendment at any time during the renewal term, i.e. , at any time beyond the 28th year of the original term of copyright. 17 U.S.C. 304(a)(3)(A)(ii). Such renewal registration may be made whether or not an original-term registration was previously made. If no original-term registration was made, the renewal term applicant must provide information, under the provision of 17 U.S.C. 409 (11), regarding the original term of copyright. Such information must demonstrate that the work submitted for renewal registration complies with all requirements of the 1909 Act with respect to the existence, ownership, or duration of the copyright for the original term of the work. The Addendum to Form RE has been used to provide this information to the Copyright Office.

The 1992 amendment further provided that, where no renewal registration has been made in the name of a party identified as entitled to the renewal right in the statute at 304(a)(1)(B) and (C), an application form may be filed at any time during the renewal term by any successor or assignee of such statutorily-enumerated party. Section 304(a)(3).

The Copyright Act of 1909 ceased to be effective on January 1, 1978. For all works published before January 1, 1978, where the year date in the copyright notice on published copies or phonorecords distributed by authority of the copyright owner was earlier than the year date of first publication, claims to renewal copyright must have been registered during the last year of the original copyright term as that term was computed from the year date in the copyright notice. For purposes of renewal registration, this year period began on December 31 of the 27th year from the year date appearing in the notice and ran through December 31 of the 28th year from the year date appearing in the notice rather than being computed from the year date of actual first publication. This ameliorative principle arose from case law under the 1909 Act and essentially benefitted the copyright owner by providing an alternative to the complete loss of copyright in instances of a wrong, i.e. , earlier, year date in the copyright notice. Further, for works governed by the 1909 copyright law, in effect until December 31, 1977, the original copyright term for a published work was computed from the date of first publication; the original term for a work first registered in unpublished form was computed from the date of registration in the Copyright Office.

On January 1, 1978, the Copyright Act of 1976, Pub. L. No. 94-553, 90 Stat. 2541 (October 19, 1976), became effective. The extensively revised copyright law provided that any work unpublished and not registered as of January 1, 1978, or published on or after that date, was to be governed by the 1976 statute and was to receive a term of protection provided by section 302 of the statute. However, for any copyright, the first term of which was subsisting on January 1, 1978, such term was to last 28 years with a possibility of a 47-year renewal term. Further, Pub. L. No. 105-298, 112 Stat. 2827, enacted October 27, 1998, changed the renewal term for works under copyright protection as of that date from 47 to 67 years.

Thus, works first published or registered for their original term of copyright on or before December 31, 1977, constitute the category of works for which the renewal structure is applicable. Any such work could have an original term of copyright of 28 years, assuming compliance with all applicable requirements of the 1909 statute, and no work governed by the carried-over renewal provisions of section 304(a) of Title 17 may possess an original term of copyright extending beyond December 31, 2005, i.e. , 28 years after December 31, 1977. Thus, December 31, 2005, was the last day on which a work first published or originally registered as unpublished during the effective period of the 1909 copyright law could have been submitted for renewal registration during the 28th year of its original term of copyright and be eligible for the benefits listed above.

After January 1, 2006, works that were first published or registered as unpublished for the original term of copyright between 1964 and 1977 will continue to be amenable to renewal registration. Concerning works eligible for renewal registration since 1992, statutory claimants and successors or assignees of such statutory claimants may file applications for the renewal term.

A claim to the renewal term must be registered in the name of the statutory claimant in whom the renewal copyright vested on the last day of the original term of copyright. 17 U.S.C. 304(a)(2)(A)(ii) and (2)(B)(ii). This is true even when that claimant is no longer the owner of the copyright in the renewal term. If the statutory claimant in whom the renewal vested is the current owner and that claimant is submitting the renewal claim, that fact must be indicated on the renewal application.

Where there is a successor or assignee of any statutory renewal claimant (the party who was the owner of the renewal term as determined on the last day of the original 28-year term of copyright), the successor or assignee may file the renewal application. 17 U.S.C. 304(a)(3)(A)(ii). Consistent with the Offices long-standing regulation at 37 CFR 202.3(b)(10), as a general rule, only one registration can be made for the same version of a particular work. This rule applies to renewal claims, including those filed by a successor or assignee. For example, if a successor-in-interest filed a renewal claim in 2006 and later assigned his interest to someone else, that person could not file a renewal claim.

In the case of an application filed by a successor or assignee, the renewal application must identify the party in whom the renewal copyright vested by virtue of 17 U.S.C. 304(a)(1)(B) and (C) but in whose name no previous renewal registration has been made; must indicate the basis upon which copyright in the renewal term vested in that party; and must identify the party filing as successor or assignee of the statutory claimant under 17 U.S.C. 304(a)(3) and the manner by which such successor/assignee secured the renewal copyright. When such an application has been filed by a successor or assignee in the name of the statutory claimant as described in 17 U.S.C. 304(a)(1)(B) and (C), the Office will generally not accept subsequent claims filed by other successors or assignees whose rights are derived from the same statutory claimant.

Where a successor or assignee claims the renewal right from the same statutory claimant as does another successor or assignee, the Copyright Office may, however, inquire concerning the particular situation and, if appropriate, may allow adverse renewal claims from both successors/assignees to be placed on the public record. Applications in which two or more persons or organizations adversely claim the copyright to the renewal term in a particular work will be handled as the Office’s Compendium of Copyright Practices, Compendium II (1984) , § 108.06, indicates: adverse claims will be registered if, after the Office inquires concerning the claims, each claim, on its own merits, is determined to meet all applicable statutory and regulatory requirements. In such a case, correspondence between the parties filing competing renewal claims and the Copyright Office will be maintained within Office records and subject to public inspection according to regulations found at 37 CFR 201.2. In cases where adverse renewal claims are not accepted by the Copyright Office, however, if a public record of renewal ownership is sought by particular successors or assignees of the same statutory claimant as indicated in the filing of a previous claim by another successor or assignee, the document of transfer of the renewal copyright may be recorded in the Copyright Office.

Under the proposed amendment, the Copyright Office will provide a revised application form for the registration of renewal claims. The proposed revised Form RE, as well as the proposed revised Form RE/CON (for use when additional information must be supplied) and Form RE/ADDENDUM (to be filed if the work, or the collective work in which it was first published, was not registered during the original term) may be viewed on the Copyright Office website at www.copyright.gov/proposedforms. Following issuance of a final rule, these new forms will be available on the Copyright Office website at www.copyright.gov as well as through postal mail upon request. Any requests to the Copyright Office for application forms for registration of claims to the renewal term will be filled with the newly revised form; the forms currently in use will be obsolete and the new forms must be used to file such renewal claims.

One of the major changes to the form will facilitate the filing of applications by successors or assignees of the statutory renewal claimants listed at 17 U.S.C. 304(a)(1)(B) and (C). During the past several years, those successors or assignees of statutory claimants who wished to file an application to the renewal term, 17 U.S.C. 304(a)(3)(ii), had to seek advice from the Copyright Office because of the lack of appropriate application-form instructions for the successor or assignee situation; this has been addressed in the revised application form.

The proposed revision of this regulatory section, 202.17, is extensive and essentially reorders much of the information which previously appeared within this section. The most important change in information concerns the end of the 28th-year renewal registration possibility.

1. Section 202.17(a) more specifically explains the relevant statutory changes of 1992 regarding renewal rights and sets out the distinction between pre-1964 works and post-1964 works with respect to renewal registration.

2. Section 202.17(b) expands the list of terms defined to include “statutory claimant,” “assignee and successor,” and “vest” as those terms relate specifically to the provisions of this renewal registration regulation.

3. Section 202.17(c) explains the relevant time periods for both original term registration and renewal term registration and their optional character as they are set out in the 1992 revision of section 304(a) of Title 17.

4. Section 202.17(d) explains the benefits of 28th-year renewal registration under the 1992 revision to section 304(a) of Title 17 and indicates that such benefits have no longer been available since January 1, 2006, because the regime of 28th-year renewal registration has ended.

5. Section 202.17(e) sets out the parties entitled to the renewal right under 17 U.S.C. 304(a)(1)(B) and (C). This section also:

a. clarifies that, in any derivative work which may be the subject of a renewal application, a renewal claim may be filed only in the new matter, revisions, or changes incorporated into that derivative work and which form the basis of the protected authorship for purposes of registration.

b. clarifies that renewal claims for a work may, under certain circumstances, be filed under the posthumous work category and also under an individual claimant category but with the Copyright Office’s taking no position as to which of such claims may be adjudicated to be valid.

For purposes of the copyright statute’s renewal provision, the term “posthumous work” means a work concerning which no copyright assignment or other contract for exploitation of the work has occurred during the author’s lifetime and which is unpublished at the time of the author’s death. Compendium of Copyright Office Practices, Compendium II (1984), 1317.03(a), citing Bartok v. Boosey & Hawkes, Inc., 523 F.2d 941 (2d Cir. 1975), and H.R. Rep. No. 1476, 94th Cong., 2d Sess 139 (1976). Two parties claiming renewal copyright who take different positions as to whether a particular work falls under the specific definition of “posthumous” which Congress adopted from Bartok may, thus, file separate and competing claims in such a situation.

c. explains several situations concerning the filing of a renewal registration claim where an executor or a party appointed to fulfill such duties may be the appropriate filer of a renewal claim or where conflicting claims between an administrator of a will and the author’s next of kin may be accepted by the Copyright Office.

The Office has also added a phrase, for purposes of § 202.17(e)(2)(iii)(C), qualifying that an executor appointed under a will must still be acting in that capacity at the time of registration when a renewal claim is filed. The phrase “if still acting in that capacity at the time of registration” is added to help claimants make decisions concerning their renewal submissions where an executor of a will may or may not be able to act in the filing of a renewal claim. For the uncertainties and varying situations concerning the presence or absence of an executor or administrator and the possibility of the next of kin’s claiming as an appropriate section 304 statutory class, see e.g. Silverman v. Sunrise Pictures Corp., 290 F. 804 (2d Cir.), cert. denied , 262 U.S. 758 (1923); Gibran v. Alfred A. Knopf, Inc. , 153 F. Supp. 854 (S.D.N.Y. 1957), aff’d sub. nom. Gibran v. National Committee of Gibran , 255 F.2d 121 (2d Cir.), cert. denied , 358 U.S. 828 (1958); Capano Music v. Myers Music, Inc ., 605 F. Supp. 692 (S.D.N.Y. 1985).

6. Section 202.17(f) clarifies the situations in which successors and assignees of the section 304(a)(1)(B) and (C) statutory renewal claimants may file applications for renewal registration.

7. Section 202.17(g) indicates the information necessary on a renewal application form for a work for which a previous, original-term registration has been made.

8. Section 202.17(h) indicates the information necessary on a renewal application form and the required accompanying deposit materials in situations for works where no original-term registration has been made. Concerning the Form RE/Addendum to be used in this situation of no original-term registration, regulatory § 202.17(h)(3)(vii) explains that the applicant must provide within the application an averment that all authorized copies of the work which were publicly distributed in the United States or elsewhere before March 1, 1989, carried a statutorily correct copyright notice.

March 1, 1989, is the effective date of the Berne Convention Implementation Act of 1988 [BCIA], making the presence of a copyright notice on copies of a work, published in the U.S., with the authorization of the copyright owner, optional. Before March 1, 1989, however, any copy, including any reprint copy, of a work published in this country or elsewhere, even though such work may have been first published under the 1909 Copyright Act, must have carried a statutorily required copyright notice. See 17 U.S.C. 405.

Claims to copyright, Copyright, Registration requirements, Renewals

In consideration of the foregoing, the Copyright Office proposes to amend Part 202 of 37 CFR, Chapter II, in the manner set forth below:

1. The authority citation for part 202 continues to read as follows:

2. Section 202.17 is revised to read as follows:

(a) General .

(1) This section concerns renewal for copyrights originally secured from January 1, 1964, through December 31, 1977, either by publication with the required copyright notice or by registration as an unpublished work. Renewal registration for these works is optional.

As provided in Pub. L. No. 102-307, 106 Stat. 264, enacted June 26, 1992, renewal registration made during the last year of the original 28-year term of copyright differs in legal effect from renewal registration made during the 67-year extended renewal term. In the latter instance, the copyright is renewed automatically at the expiration of the original 28-year term.

In the former instance, renewal by registration during the last year of the original 28-year term vested the renewal copyright in the statutory claimant living on the date of registration.

(2) Works for which copyright was secured before 1964 are governed by the provisions of 17 U.S.C. 304(a) in effect prior to the 1992 date of enactment of Pub. L. No. 102-307. The copyrights in such works could have been renewed by registration only within the last calendar year of the original 28-year term of copyright protection. If renewal registration was not made during that period of time, copyright protection was lost when the original term of copyright expired and cannot be regained.

(3) Works restored to copyright by the Uruguay Round Agreements Act are governed in their copyright term of protection by Pub. L. No. 103-465, 108 Stat. 4809, 4976 (December 8, 1994). Under 17 U.S.C. 104A(a)(1)(A) and (B), as amended, any work in which copyright is restored subsists for the remainder of the term of copyright that the work would have been otherwise granted in the United States. Such term includes the remainder of any applicable renewal term.

(4) Automatic restoration of copyright in certain foreign works that were in the public domain in the United States may have occurred under the Uruguay Round Agreements Act and may be protected by copyright or neighboring rights in their “source country,” as defined at 17 U.S.C. 104A(h)(8).

(b) Definitions.

(1) For purposes of this section, the terms assignee and successor , as they pertain to 17 U.S.C. 304(a)(3)(A)(ii), refer to a party which has acquired the renewal copyright in a work by assignment or by other means of legal succession from the statutory claimant [as that claimant is defined in 17 U.S.C. 304(a)(1)(B) and (C)] in whom the renewal copyright vested but in whose name no renewal registration was previously made.

(2) For purposes of this section, a work has been copyrighted when it has been published with a proper copyright notice or, in the case of an unpublished work, when it has been registered for copyright.

(3) For purposes of this section, the term posthumous work means a work that was unpublished on the date of the death of the author and with respect to which no copyright assignment or other contract for exploitation of the work occurred during the author’s lifetime.

(4) For purposes of this section, the term statutory claimant means:

(i) a party who was entitled to claim copyright for the renewal term at the time renewal registration was made either as a proprietary claimant ,17 U.S.C. 304(a)(2)(A)(i), or as a personal claimant, 17 U.S.C. 304(a)(2)(B)(i), if registration was made during the original term of copyright; or,

(ii) if the original copyright term expired, a party who was entitled to claim copyright for the renewal term as of the last day of the original term of copyright as either a proprietary or a personal claimant, 17 U.S.C. 304(a)(2)(A)(ii) and (a)(2)(B)(ii).

(5) For purposes of this section, the term to vest means to give a fixed, non-contingent right of present or future enjoyment of the renewal copyright in a work. If renewal registration was made during the 28th year of the original term of copyright, the renewal copyright vested in the party or parties entitled to claim such copyright at the time of registration as provided by 17 U.S.C. 304(a)(1)(B) and (C). Although the vested right may have been determined by registration during the 28th year of the original term, the exercise of such right did not commence until the beginning of the renewal term, as provided in 17 U.S.C. 304(a)(2). If renewal registration was not made during the 28th year, the renewal copyright automatically vested upon the beginning of the renewal term in the party or parties entitled to claim such copyright on the last day of the original term as provided by 17 U.S.C. 304(a)(2)(A)(ii) and (B)(ii).

(c) Time limits: original term and renewal term registration .

(1) Under 17 U.S.C. 304(a), prior to its amendment of June 26, 1992, a registration for the original term of copyright must have been made during the 28 years of that original term, and a renewal registration must also have been made during the 28th year of that term. Pub. L. No. 102-307, 106 Stat. 264 (June 26, 1992) amended section 304(a) for works originally copyrighted from January 1, 1964, through December 31, 1977, and provided for optional original-term registration and optional renewal registration. 17 U.S.C. 304(a)(2), (a)(3) and 409(11). For such works, claims to renewal copyright could have been registered during the last year of the original term but such registration was not required in order to enjoy statutory protection during the renewal term. 17 U.S.C. 304(a)(3)(B).

(2) A renewal registration can be made at any time during the renewal term. 17 U.S.C. 304(a)(3)(A)(ii). If no original-term registration was made, renewal registration remains possible; but the Register may request information, under 17 U.S.C. 409(11), regarding the original term of copyright. Such information must demonstrate that the work complies with all requirements of the 1909 Act with respect to the existence, ownership, or duration of the copyright for the original term of the work. The Form RE/Addendum is used to provide this information.

(3) Renewal registration is currently available for works copyrighted from January 1, 1964, through December 31, 1977. Under the provisions of 17 U.S.C. 304(a)(3)(A)(ii), renewal registration may be made any time during the 67-year renewal term for such works according to the procedure indicated in paragraph (h) of this section. Such renewal registration is optional and is not a condition of the subsistence of the copyright for the 67-year renewal term. 17 U.S.C. 304(a)(3)(B). In the case of such works for which no registration was made during the original term of copyright, renewal registration may be made by submission of a Form RE/Addendum. The Addendum, an adjunct to the renewal form, concerns the facts of first publication for a work and assures the Copyright Office that the work as it existed in its original term of copyright was in compliance with the 1909 copyright law, 17 U.S.C. 1, et. seq. (1909 Act, in effect through December 31, 1977), whose provisions govern such works.

(d) Benefits of 28th-year renewal registration .

Prior to January 1, 2006, renewal registration was available during the 28th year of the original term of copyright for works copyrighted from January 1, 1964, through December 31, 1977. As provided in Pub. L. No. 102-307, 106 Stat. 264, registration made during the 28th year of the original term of copyright provided the following benefits to the registrant:

(1) The certificate of registration constituted prima facie evidence as to the validity of the copyright during its renewal term and of the facts stated in the certificate. 17 U.S.C. 304(a)(4)(B).

(2) A derivative work prepared under the authority of a grant of a transfer or license of copyright in a work made before the expiration of the original term of copyright could not continue to be used under the terms of the grant during the renewal term without the authority of the owner of the renewal copyright. 17 U.S.C. 304(a)(4)(A).

(3) The renewal copyright vested upon the beginning of the renewal term in the party entitled to claim the renewal of copyright at the time the application was made as provided under 17 U.S.C. 304(a)(2)(A)(i) and (B)(i).

(e) Statutory parties entitled to claim copyright for the renewal term under section 304(a) .

(1) Renewal claims must be registered in the name of the party or parties entitled to claim copyright for the renewal term as provided in paragraphs 2 through 4 of this section and as specified in 17 U.S.C. 304(a). If a work was a new version of a previously published or registered work, renewal registration may be claimed only in the new matter.

(2) If the renewal claim was submitted during the last, i.e. , the 28th, year of the original term of copyright, the claim had to be registered in the name[s] of the statutory claimant[s] entitled to claim the renewal copyright on the date on which the claim was submitted to the Copyright Office. If the renewal claim is submitted during the sixty-seven year extended renewal term, the renewal claim can be registered only in the name[s] of the statutory claimant[s] entitled to claim the renewal on the last day (December 31) of the original term of copyright. These eligible renewal claimants are listed below:

(i) The person who, on the applicable day, was the copyright proprietor is the appropriate renewal claimant in any posthumous work or any periodical, encyclopedia, or other composite work upon which the copyright was originally secured by the proprietor

(ii) The person who, on the applicable day, was the copyright proprietor is the appropriate claimant in any work copyrighted by a corporate body (otherwise than as assignees or licensees of the individual author), or by an employer for whom such work was made for hire.

(iii) For any other copyrighted work, including a contribution by an individual author to a periodical or to an cyclopedic or other composite work, the appropriate claimants, in descending order of eligibility, are the person who, on the applicable day, was:

(A) the author(s) of the work, if still living;

(B) the widow(er) and/or child(ren) of the author, if the author was deceased on the applicable day;

(C) the author’s executor(s), if still acting in that capacity on the applicable day, provided the author had a will and neither the author, nor any widow(er) or child of the author is still living;

(D) the author’s next of kin, in the absence of a will and if neither the author nor any widow, widower or child of the author is living.

(3) The provisions of paragraphs (e)(1) and (2) of this section are subject to the following qualification: Notwithstanding the definition of “posthumous work” in paragraph (b)(4) of this section, a renewal claim may be registered in the name of the proprietor of a work, as well as in the name of the appropriate claimant under paragraph (e)(2)(iii) of this section, in any case in which a contract for exploitation of the work but no copyright assignment in the work has occurred during the author’s lifetime. However, registration by the Copyright Office in this case should not be interpreted as evidencing the validity of either claim.

(4) The provisions of paragraphs (e)(2)(iii)(C) and (D) of this section are subject to the following qualifications:

(i) In any case where:

(A) the author has left a will which names no executor; or,

(B) the author has left a will which names an executor who cannot or will not serve in that capacity; or,

(C) the author has left a will which names an executor who has been discharged upon settlement of the estate, removed before the estate has been completely administered, or is deceased at the time of the renewal registration submission, the renewal claim may be registered either in the name of an administrator cum testamento annexo (administrator c.t.a.) or an administrator de bonis non cum testamento annexo (administrator d.b.n.c.t.a.) so appointed by a court of competent jurisdiction.

(ii) In any case described in paragraph (e) of this section, except in the case where the author has left a will without naming an executor and a court-appointed administrator c.t.a. or administrator d.b.n.c.t.a. is in existence at the time of renewal registration, the renewal claim also may be registered in the name of the author’s next of kin. However, registration by the Copyright Office of conflicting renewal claims in such a case should not be interpreted as evidencing the validity of either claim.

(f) Successors/assignees entitled to file an application for the renewal term under section 304(a). (1) The provisions of paragraph (e) of this section are subject to the following qualifications:

(i) Where no renewal registration has been made in the name of a person or entity identified in paragraphs (e)(2)(i), (ii) and (iii) of this section, a renewal application may be filed at any time during the renewal term by any successor or assignee of such person or entity.

(ii) In such cases described in paragraph (f)(1)(i) of this section, the renewal application must identify the party in whom the renewal copyright vested; must indicate the basis upon which copyright for the renewal term vested in that party; must identify the party who is the successor or assignee of the statutory claimant under 17 U.S.C. 304(a)(3); and, must give the manner by which such successor/assignee secured the renewal copyright.

(iii) When such a claim has been filed by a successor or assignee in the name of the statutory claimant as described in paragraph (e)(2)(i), (ii) and (iii) of this section, generally no subsequent claims may be filed by other successors or assignees whose rights are derived from the same statutory claimant. If a public record of renewal ownership is sought by other successors or assignees of the same statutory claimant, the document of transfer of the renewal copyright, either the renewal in its entirety or in part, may be recorded in the Copyright Office.

(iv) Where a successor or assignee claims the renewal right from the same statutory claimant as does another successor or assignee, the Copyright Office may inquire concerning the situation and, if appropriate, may allow adverse renewal claims from the successors/assignees to be placed on the public record. In such cases, correspondence between the parties filing competing renewal claims and the Copyright Office will be, as always, maintained within Office records and subject to public inspection according to regulations found at 37 CFR 201.2.

(g) Application for renewal registration for a work registered in its original 28-year term.

(1) Each application for renewal registration shall be submitted on Form RE. All forms are available free of charge via the Internet by accessing the Copyright Office homepage at http://www.copyright.gov. Copies of Form RE are also available free upon request to the Public Information Office, United States Copyright Office, Library of Congress, 101 Independence Avenue, Washington, DC 20559-6000.

(2) (i) An application for renewal registration may be submitted by any eligible statutory renewal claimant as specified in paragraph (e) of this section or by the duly authorized agent of such claimant, or by the successor or assignee of such claimant as provided under paragraph (f) of this section or by the duly authorized agent of such successor or assignee.

(ii) An application for renewal registration shall be accompanied by the required fee as set forth in 37 CFR 201.3. The application shall contain the information required by the form and its accompanying instructions, and shall include a certification. The certification shall consist of:

(A) A designation of whether the applicant is the renewal claimant, or a successor or assignee, or the duly authorized agent of such claimant or of such successor or assignee (whose identity shall also be given);

(B) The handwritten signature of such claimant, successor or assignee, or agent, accompanied by the typewritten or printed name of that person;

(C) A declaration that the statements made in the application are correct to the best of that person’s knowledge; and

(D) The date of certification.

(3) Once a renewal registration has been made, the Copyright Office will not accept another application for renewal registration on behalf of the same renewal claimant.

(h) Renewal with addendum registration for an unregistered work .

(1) General . For published works copyrighted from January 1, 1964, through December 31, 1977, where no registration was made during the original term of copyright and where renewal registration is sought during the 67-year renewal term, the Form RE/Addendum must be used to provide information concerning the original term of copyright. The Form RE/Addendum requires a separate fee and the deposit of one copy or phonorecord of the work as first published (or identifying material in lieu of a copy or phonorecord). The effective date of registration for a renewal claim submitted on a Form RE/Addendum is the date the Copyright Office receives an acceptable completed application, the required fees, and an acceptable deposit for the work.

(2) Time Limits . A renewal claim accompanied by an Addendum to Form RE may be filed at any time during the 67-year renewal term.

(3) Content . The Form RE/Addendum must contain the following information:

(i) The title of the work;

(ii) The name of the author(s);

(iii) The date of first publication of the work;

(iv) The nation of first publication of the work;

(v) The citizenship of the author(s) on the date of first publication of the work;

(vi) The domicile of the author(s) on the date of first publication of the work;

(vii) An averment that, at the time of first publication, and thereafter until March 1, 1989 [effective date of the Berne Implementation Act of 1988], all the copies or phonorecords of the work, including reprints of the work, published, i.e. , publicly distributed in the United States or elsewhere, under the authority of the author or other copyright proprietor, bore the copyright notice required by the Copyright Act of 1909 and that United States copyright subsists in the work;

(viii) For works of United States origin which were subject to the manufacturing provisions of section 16 of the Copyright Act of 1909 as it existed at the time the work was published, the Form RE/Addendum must also contain information about the country of manufacture and the manufacturing processes; and

(ix) The handwritten signature of the renewal claimant or successor or assignee, or the duly authorized agent of the claimant or of the successor or assignee. The signature shall be accompanied by the printed or typewritten name of the person signing the Addendum and by the date of the signature; and shall be immediately preceded by a declaration that the statements made in the application are correct to the best of that person’s knowledge.

(4) Fees . Form RE and Form RE/Addendum must be accompanied by the required fee for each form as required in 37 CFR 201.3.

(5) Deposit requirement . One copy or phonorecord or identifying material of the work as first published in accordance with the deposit requirements set out in 37 CFR 202.20 and 202.21 is required.

(6) Waiver of the deposit requirement . Where the renewal applicant asserts that it is either impossible or otherwise an undue hardship to satisfy the deposit requirements of 37 CFR 202.20 and 202.21, the Copyright Office, at its discretion, may, upon receipt of an acceptable explanation of the inability to submit such copy or identifying material, permit the deposit of the following in descending order of preference. In every case, however, proof of the copyright notice showing the content and location of the notice as it appeared on copies or phonorecords of the work as first published must be included.

(i) A reproduction of the entire work as first published ( e.g. , photocopy, videotape, audiotape, CD-ROM, DVD are examples of physical media which may hold reproductions of a work as first published). If the work is a contribution to a periodical, a reproduction of only the contribution (including the relevant copyright notice) will suffice.

(ii) A reprint of the work ( e.g. , a later edition, a later release of a phonorecord, or the like). The reprint must show the copyright notice as it appeared in the same location within the first published copy of the work as well as the exact content of the copyright notice appearing in the first published edition. If the copyrightable content of the reprint differs from that of the first published edition, an explanation of the differences between the two editions is required.

(iii) Identifying material including a reproduction of the greatest feasible portion of the copyrightable content of a work including a photocopy or photograph of the title page, title screen, record label or the like, as first published, and a photocopy or photograph showing the copyright notice content and location as first published. The Copyright Office may request deposit of additional material if the initial submission is inadequate for examination purposes.

You may be potentially affected by this action if you manufacture, import, process, or use PIPs. In order to identify potentially impacted industries the analysis relies on North American Industrial Classification System (NAICS) codes. Potentially affected entities may include, but are not limited to:

• Pesticide and Other Agricultural Chemical Manufacturing (NAICS code 325320). This industry comprises establishments that are producing PIPs intended for distribution and sale as pesticides.

• Crop Production (NAICS code 111). These are establishments such as farms, orchards, groves, greenhouses, and nurseries, primarily engaged in growing crops, plants, vines, or trees and their seeds.

• Colleges, Universities, and Professional Schools (NAICS code 611310). This industry comprises establishments primarily engaged in furnishing academic courses and granting degrees at baccalaureate or graduate levels. Furthermore, they may comprise establishments where research on PIPs occurs and where PIPs may be grown.

• Research and Development in the Physical, Engineering, and Life Sciences (NAICS code 54171). This industry comprises establishments primarily engaged in conducting research and experimental development in the physical, engineering, or life sciences, such as agriculture, environmental, biology, botany, biotechnology, forests, and other allied subjects.

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. 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 a docket for this action under docket ID number EPA-HQ-OPP-2006-1003. Publicly available docket materials are available either in the electronic docket at http://www.regulations.gov , or, if only available in hard copy, at the Office of Pesticide Programs (OPP) Regulatory Public Docket in Rm. S-4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. The hours of operation of this Docket Facility are from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The Docket Facility telephone number is (703) 305-5805.

2. Tips for preparing your comments . When submitting comments, remember to:

i. Identify the document by docket ID number and other identifying information (subject heading, Federal Register date and page number).

ii. Follow directions. The Agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.

iii. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.

iv. Describe any assumptions and provide any technical information and/or data that you used.

v. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

vi. Provide specific examples to illustrate your concerns and suggest alternatives.

vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats.

viii. Make sure to submit your comments by the comment period deadline identified.

PIPs are “pesticidal substances that are intended to be produced and used in a living plant, or the produce thereof, and the genetic material necessary for the production of such a pesticidal substance. PIPs also include any inert ingredient contained in the plant, or the produce thereof.” (40 CFR 174.3) By definition, PIPs are primarily distinguished from other types of pesticides because they are intended to be produced and used in the living plant. Other types of pesticides are primarily produced in a facility and used through physical application, e.g., spraying or dusting of the plant. Since PIPs were not defined when the existing regulations associated with pesticide establishments and pesticide production were promulgated, the existing regulations may not adequately address this distinction.

The Agency is therefore considering amending the current FIFRA regulations associated with pesticide establishments and pesticide production to better address PIPs and PIP production given the unique characteristics of PIPs compared to other types of pesticides.

EPA is soliciting comments from interested stakeholders on the issues and questions identified in this ANPRM. EPA intends to use this information in reviewing these regulations and developing its proposed rules.

EPA has regulatory authority to promulgate regulations under FIFRA sections 3(a), 8(a), 25(a), and 25(b) (7 U.S.C. 136a(a), 136f(a), 136w(a), and 136w(b)).

PIPs are pesticides under FIFRA section 2 because they are introduced into plants with the intention of “preventing, destroying, repelling, or mitigating any pest...” (7 U.S.C. 136(u)).

Under FIFRA section 7, any person who manufactures, prepares, compounds, propagates, or processes any pesticide is a “producer.” “Produce,” as further described in in 40 CFR 167.3, also means to package, repackage, label, relabel, or otherwise change the container of any pesticide. FIFRA section 7 requires that producers of pesticides register the establishments where production occurs and requires that producers report their annual production (7 U. S. C. 136e). In addition, producers of pesticides are required under FIFRA section 8(a) to maintain records with respect to their operations, and to make such records available for inspection (7 U.S.C. 136f(a)). Under FIFRA section 9 appropriately credentialed inspectors have the authority to conduct inspections at pesticide producing establishments or other places where pesticides are being held for distribution or sale for the purpose of inspecting and obtaining samples (7 U.S.C. 136g).

EPA believes that the existing regulations need to be amended to better address apparent differences between PIPs and other types of pesticides in the application of FIFRA’s production and production-related requirements. The existing regulations were written for pesticides that are generally produced and used in a more traditional manner, e.g., spraying or dusting onto the plants. PIPs are produced and used in a living plant, which raises questions regarding how that “production” should be regulated under the existing authorities of FIFRA. In general, EPA’s experience with PIPs is that they present different and potentially lower risk situations compared to chemical pesticides. However, EPA needs to ensure that appropriate PIP production data are available to manage any potential risk a PIP might pose.

The United States Government published in the Federal Register issue of June 26, 1986 (51 FR 23302) a document entitled, Coordinated Framework for Regulation of Biotechnology (“Coordinated Framework”), which describes in broad terms the Federal Government’s approach to regulating biotechnology products. In that document, the Federal Government concluded that it could appropriately regulate the products of biotechnology under existing laws, but recognized that, in some cases, new regulations might be needed. Consistent with the Coordinated Framework, EPA regulates PIPs under its pesticide authorities. In the Federal Register issue of July 19, 2001 (66 FR 37771) (FRL-6057-7), EPA published a rule that established a regulatory framework for PIPs. That rule clarified the relationship between plants and PIPs under FIFRA, exempted from FIFRA requirements PIPs derived entirely through conventional breeding between sexually compatible plants, established a new part in the Code of Federal Regulations specifically for PIPs (40 CFR part 174), provided requirements for reporting of adverse effects, and set forth certain procedures for CBI. In that Federal Register document, EPA also anticipated the future need for proposing regulations tailored specifically to PIPs so that the regulatory framework would better fit their unique characteristics (66 FR 37807). EPA indicated that it would continue to apply existing regulations to PIPs, except where superseded by the regulations in the July 19, 2001 Final Rule, until the Agency could develop additional regulations specifically tailored to PIPs.

Since the mid-1990s, EPA has approved a number of PIP experimental use permits (EUPs) under FIFRA section 5, as well as seed increase and commercial use registrations under FIFRA section 3. During this time, EPA has registered facilities involved in the production of PIPs as pesticide producing establishments under FIFRA section 7. These have included, for example, sites of the original transformation (where plant tissue was transformed by the insertion of PIP genetic material) and seed processing facilities.

FIFRA section 7 requires that producers of pesticides register the establishments where the pesticide is produced and report the amount of pesticide produced. EPA’s experience to date has demonstrated, particularly in the area of pesticide production, that the existing regulations (e.g., 40 CFR part 167) may need to be better tailored to address PIPs. For example, existing regulations require pesticide production quantities to be reported in terms of volume or weight (gallons or pounds), measurements that are not useful when considering a pesticidal substance produced within a plant. Other questions concern the manner in which PIPs are increased within a living plant. Such increase occurs at many stages from product development through use, which raises questions concerning where pesticide production occurs, and what establishments must register and report their production. Clarification of this matter would help to ensure that appropriate persons comply with production related requirements, and that other persons do not face unnecessary regulatory burden. To that end, EPA is reviewing the existing regulations in 40 CFR chapter I, subchapter E and considering potential regulatory changes to address the apparent differences between PIPs and other types of pesticides.

EPA is considering amending the following existing regulations related to pesticide establishment and production to better address PIPs and PIP production:

1. Registration of establishments where PIPs are produced (FIFRA section 7 and 40 CFR 167.20). Current regulations require any producer of a pesticide to register the “production” site with EPA. The statutory and regulatory definitions of “produce” include several activities, including manufacturing, preparing, compounding, propagating, or processing any pesticide or packaging, repackaging, labeling, and relabeling the container of any pesticide.

2. Reporting by registered production establishments (FIFRA section 7 and 40 CFR 167.85). Current regulations require a producer operating a producing establishment to report annually the types and amount of each pesticidal product that was produced, sold, or distributed the previous year and to estimate the amount that will be produced during the current year.

3. Recordkeeping and inspection authority (FIFRA sections 8 and 9 and 40 CFR 169.2 and 169.3). EPA's statutory authority under FIFRA section 8, and the regulations promulgated thereunder, require pesticide producers, registrants, and applicants for registration to maintain certain records related to pesticide production (i.e., including information regarding the production, receipt, and shipment of pesticides) and to provide these records upon request to appropriately credentialed inspectors. FIFRA section 8 also provides authority for appropriately credentialed inspectors to conduct inspections to access such information. Furthermore, under FIFRA section 9 appropriately credentialed inspectors have the authority to conduct inspections at pesticide producing establishments or other places where pesticides are being held for distribution or sale for the purpose of inspecting and obtaining samples.

4. Labeling on PIP containers (FIFRA section 2 and 40 CFR 156.10). The statute and current regulations provide requirements for labeling of pesticides, including name of the product, identity of the producer, net content, product registration number, establishment registration number, ingredient statement, hazard and precautionary statements, directions for use, and use classification. Currently, PIPs are labeled for FIFRA section 5 EUPs and FIFRA section 3 seed increase registrations only.

5. EUPs for field testing of unregistered PIPs (FIFRA section 5 and 40 CFR part 172). FIFRA allows for field testing of unregistered pesticides under an EUP. Any pesticide production activity related to an EUP, either the production of a pesticide for use in an EUP or by being produced as a result of an EUP, is subject to FIFRA production establishment and recordkeeping requirements.

6. Production of unregistered PIPs for export (FIFRA section 17 and 40 CFR 168.65-168.85). FIFRA exempts pesticides intended solely for export from certain FIFRA requirements, including product registration requirements. Products intended for export only are therefore not subject to the product safety evaluation required of products intended for domestic distribution and sale. However, they must still comply with the producer establishment registration, reporting and recordkeeping requirements of FIFRA sections 7 and 8 and are subject to certain labeling requirements, e.g., their label must include the statement: “Not Registered for Use in the United States of America.”

EPA is seeking public comment on the completeness of the list of current regulations that need to be reviewed for applicability to PIPs and PIP producers (see Unit III.), and is soliciting related information to use in reviewing these regulations and developing its proposed rules. These issues are especially challenging for PIPs, since based on statutory and regulatory definitions, the borders between production and use are unclear. EPA is seeking public input to help inform decisions on how best to ensure appropriate compliance without imposing unnecessarily burdensome reporting or labeling requirements on PIP registrants, producers, distributors, and users.

1. EPA would like comments in response to the following questions with respect to the regulations referenced in Unit III.:

a. Registration of establishments (Unit III.1.). Given that PIPs by definition are intended to be produced and used in a living plant, what activities should the Agency consider to be part of “production” as that term is defined in FIFRA (which includes manufacturing, preparing, compounding, propagating, or processing any pesticide or packaging, repackaging, labeling, and relabeling the container), and what establishments should be registered to help EPA manage any potential risks associated with PIPs? What other types of facilities, if any (e.g., growers involved in seed production), involved in the development of PIP-containing varieties should be subject to these requirements? Please explain the reason for your response.

b. Production reporting (Unit III.2.). What production reporting, by whom and in what units (e.g., volume, weight, number of seeds, etc.) would be appropriate? Should reporting units be dependent on the reproductive methodology of the crop (e.g., seeds, bulbs, or tubers)? Given your response to Unit IV.1.a., what types of production reporting would provide the Agency with information valuable for compliance assurance purposes and for managing any potential risks associated with a violation?

c. Recordkeeping and inspection (Unit III.3.). What establishments or other locations are appropriate to be inspected for records and samples, and what records would be appropriate for producers of PIPs to maintain?

d. Labeling (Unit III.4.). Please comment on current labeling practices for PIPs. Are current labeling practices sufficient? For example, do grower agreements offer sufficient information and compliance assurance to ensure registered PIPs are used in a manner that protects human health and the environment? Are there circumstances where labeling different from that currently in practice for PIPs may be appropriate?

e. Experimental use permits (Unit III.5.). Are there aspects of production in association with PIP EUPs that are different from production associated with other types of pesticides used in EUPs? If there are differences, how should they be addressed for PIP EUPs?

f. Production for export (Unit III.6.). What conditions would ensure that a PIP is intended for export only, and what would be necessary for such a PIP to meet the requirements of FIFRA?

2. Are there other characteristics not described in this document unique to PIPs that may affect the application of the existing regulations associated with pesticide establishments and pesticide production to PIP producers?

3. Are there additional sections of FIFRA implementing regulations related to pesticide establishment and production regulations that should be modified to more effectively address the unique characteristics of PIPs?

Under Executive Order 12866, entitled Regulatory Planning and Review (58 FR 51735, October 4, 1993), the Office of Management and Budget (OMB) has determined that ANPRMs are considered “significant regulatory actions” under section 3(f) of the Executive Order. The Agency therefore submitted this document to OMB for the 10-day review period afforded under this Executive order. Any changes made in response to OMB comments during that review have been documented in the docket as required by the Executive order.

Since this ANPRM does not impose or propose any requirements, and instead seeks comments and suggestions for the Agency to consider in possibly developing a subsequent proposed rule, the various other review requirements that apply when an agency imposes requirements do not apply to this action.

As part of your comments on this ANPRM, you may include any comments or information that you have regarding this action. In particular, any comments or information that would help the Agency to assess the potential impact of a rule on small entities pursuant to the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq .); to consider voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note); to consider environmental health or safety effects on children pursuant to Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997); or to consider human health or environmental effects on minority or low-income populations pursuant to Executive Order 12898, entitled Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994). The Agency will consider such comments during the development of any subsequent notice of proposed rulemaking as it takes appropriate steps to address any applicable requirements.

This is a synopsis of the Commission's Report and Order, MB Docket No. 04-319, adopted March 16, 2007, and released March 20, 2007. The full text of this Commission decision is available for inspection and copying during regular business hours at the FCC's Reference Information Center, Portals II, 445 Twelfth Street, SW., Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 1-800-378-3160 or http://www.BCPIWEB.com.

This document is not subject to the Congressional Review Act. (The Commission, is, therefore, not required to submit a copy of this Report and Order to the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A) because the proposed rule is denied.)

Until the late 1970s, the Board's predecessor, the Interstate Commerce Commission (ICC), had found contract rates between a railroad and a shipper to be per se unlawful. They were regarded as a destructive competitive practice that would have the effect of damaging existing rate structures and reducing competition. 1 In 1978, the ICC changed course, issuing a policy statement acknowledging that contract rates may be beneficial in many circumstances because “a shipper is guaranteed a certain rate for the period of the contract while the carrier knows what service that shipper will receive.”  2 In that proceeding, the ICC adopted the following definition of a rail “contract rate”:

Congress viewed the ICC's changed policy as insufficient, because it had “a number of restrictions and uncertainties and [had] resulted in the limited use of contracts.”  4 To ensure that shippers and railroads would be free to enter into rail transportation contracts “without concern about whether the ICC would disapprove a contract,”  5 in the Staggers Rail Act of 1980 (Staggers Act), 6 Congress amended the statute to provide that railroads “may enter into a contract with one or more purchasers of rail services to provide specified services under specified rates and conditions.” Former 49 U.S.C. 10713(a) (1995) (now codified at 49 U.S.C. 10709(a)). When originally enacted, the provision further stated that “a rail carrier may not enter into a contract with purchasers of rail service except as provided in this section.” Former 49 U.S.C. 10713(a) (1995).

Congress also expressly removed all matters and disputes arising from rail transportation contracts from the ICC's (and now the Board's) jurisdiction. See former 49 U.S.C. 10713(i) (1995) (now codified at 49 U.S.C. 10709(c)). If the parties have a dispute regarding such a contract—such as whether there has been adequate performance or whether the contract is void because it was signed under duress—such matters are to be decided by the courts under applicable state contract law. See former 49 U.S.C. 10713(i)(2) (1995) (now codified at 49 U.S.C. 10709(c)(2)). Congress also explained that, if someone believes that a contract is anticompetitive, “the antitrust laws are the appropriate and only remedy available.”  7 Congress considered the contract rate provision of the Staggers Act to be “among the most important in the bill.”  8 But there is no clear distinction in the statute or our precedent between a contract and a common carrier rate.

In a recent proceeding, Kansas City Power & Light Company v. Union Pacific Railroad Company, STB Docket No. 42095 ( KCPL ), the Board asked the parties to submit briefs to discuss a hybrid pricing mechanism that the carrier designated a common carrier pricing arrangement, but could be viewed as a rail transportation contract. See Kansas City Power & Light Co. v. Union Pac. R.R., STB Docket No. 42095 (STB served July 27, 2006). The parties took the position that the rates at issue were common carrier rates subject to the Board's jurisdiction. The parties cited agency precedent for the proposition that a common carrier rate “is nothing more than a special kind of contract between a carrier and its shippers,” citing National Grain & Feed Assoc. v. BN RR. Co., et al. , 8 I.C.C.2d 421, 437 (1992), and whether a contract or common carrier rate exists has been examined on a case-by-case basis in light of the parties' intent, citing Aggregate Volume Rate on Coal, Acco, UT to Moapa, NV, 364 I.C.C. 678, 689 (1981) (Utah). The parties also pointed out that the agency has in the past stated that the purpose of allowing for contract rates is to establish negotiated, mutually agreeable rates to which parties intend to be bound. See Utah, 364 I.C.C. at 689; see also Product and Geographic Competition, 2 I.C.C.2d 1, 11 (1985); Market Dominance Determinations, 365 I.C.C. 118, 125 (1981). The Union Pacific Railroad Company (UP) also argued that it can enter into any kind of bilateral agreement with a shipper, but maintain Board jurisdiction by labeling the agreement a common carrier rate rather than a contract rate. It contended that a carrier has the authority to designate what type of rate it is establishing, based on section 10701(c), arguing “[u]nless a specific prohibition applies, ‘a rail carrier may establish any rate for transportation or other service provided by the rail carrier.' Rail carriers thus have broad flexibility to design common carrier offerings as alternatives to rail transportation contracts in response to business needs.”  9 Because the parties could have reasonably relied on prior agency precedent to conclude that this kind of hybrid pricing mechanism is subject to Board jurisdiction, we concluded that it would be inappropriate to set aside or reexamine that ICC precedent in that adjudication.

Nevertheless, we have serious concerns about the lack of any clear demarcation between contract and common carrier rates because of the boundaries on our jurisdiction. The carrier in the KCPL proceeding has crafted a hybrid pricing mechanism that appears to have all of the characteristics of a rail transportation contract, but avoids some important consequences of entering into such a contract by its choice of label. Traditionally, common carrier pricing has been a holding out to the public to provide a specified transportation services for a given price that a shipper accepts by tendering traffic. Under these unilateral contracts, 10 the carrier has the right to change the common carrier rates or terms upon 20 days' notice under 49 U.S.C. 11101(c). In other words, where there is no mutuality of consideration, a carrier can unilaterally withdraw one offer and replace it with another.

The new pricing structures we are witnessing as reflected in the KCPL proceeding, however, contain a mutuality of obligation between the carriers and shippers that appear to have the hallmarks of a contractual relationship. These bilateral agreements mutually bind both the shipper and the carrier for a given period of time. In exchange for some sort of consideration from the shipper, the carrier commits to a specific rate or service for a specific term. While Congress intended to permit carriers to have the pricing flexibility to enter into these kinds of agreements, we believe that Congress also intended for these contractual agreements to be confidential, outside Board jurisdiction, and subject to the scrutiny of the antitrust laws, rather than regulation under the Interstate Commerce Act.

We also have concerns that the increased used of these hybrid pricing mechanisms could create an environment where collusive activities in the form of anticompetitive price signaling could occur. Whereas the terms and conditions of common carrier rates must be publicly disclosed under section 11101, 11 the terms of a rail transportation contract are to be kept confidential, a factor that makes collusion in this highly concentrated industry more difficult. 12 Thus, a carrier's hybrid pricing mechanism may not contain the same protections against collusion as do traditional confidential transportation contracts. An important competitive benefit of contracts is that they often enable shippers to obtain service commitments and lower rates that carriers might not otherwise offer through the public tariff process.

We also question whether the position advanced by UP that these sorts of rates are authorized by section 10701(c) is consistent with the statutory scheme. Read in context with the other provisions of section 10701, we believe that subsection (c) addresses the level of the rate that a carrier may set in the first instance, and does not allow the carrier to control the designation of the type of rate that is involved. Moreover, under the railroad's interpretation, there would appear to be no type of agreement between a carrier and a shipper—no matter how long the term or how individually tailored or bilateral the responsibilities created—that a carrier could not unilaterally label common carrier rate and service terms. If that were so, the contract provision in section 10709 would become largely superfluous.

Similarly, the carrier's interpretation would render section 10722 redundant. In that provision, Congress expressly authorized rail carriers to establish premium charges in common carrier rates for special services or special levels of service in order to encourage more efficient use of freight cars. See 49 U.S.C. 10722. If, however, section 10701 authorizes common carrier tariffs that embrace any kind of special rates and terms, it would not have been necessary for Congress to separately authorize special rates in section 10722.

We are inclined to find that a more reasonable interpretation of the statute is that section 10701 does not authorize carriers to enter into either special common carrier rates or bilateral contractual agreements. Both the authority for, and limitations on, those types of rates are set forth in sections 10722 and 10709, respectively. Section 10709, in turn, removes those contracts from the regulatory scheme associated with common carrier service.

In light of the above concerns, we seek public comment on our proposed interpretation of the term “contract” in section 10709 as embracing any bilateral agreement between a carrier and a shipper for rail transportation in which the railroad agrees to a specific rate for a specific period of time in exchange for consideration from the shipper, such as a commitment to tender a specific amount of freight during a specific period or to make specific investments in rail facilities. Under the proposed interpretation, notwithstanding any carrier representation that the rate specified in the agreement is a common carrier rate, such a bilateral agreement would be regarded by the Board as a rail transportation contract under section 10709 and therefore outside the Board's jurisdiction. See Columbia Gas Transmission Corp. v. FERC, 404 F.3d 459, 463 (D.C. Cir. 2005) (“jurisdiction cannot arise from the absence of objection, or even from affirmative agreement. To the contrary, as a statutory entity, [the agency] cannot acquire jurisdiction merely by agreement of the parties before it.”); see also Weinberger v. Bentex Pharms., Inc., 412 U.S. 645, 652 (1973) (only Congress, not parties, may confer jurisdiction).

Though we need not seek public comments before issuing an interpretative rule of this nature, we do so here to ensure that we have fully considered the issues and ramifications before taking this action. We do not intend to stifle innovation in transportation markets or otherwise disadvantage any party.

To the extent this interpretation could be seen as contradicting past agency statements regarding whether a bilateral agreement can constitute a common carrier rate, we would apply this interpretation prospectively only. However, we do not want to create incentives for a carrier to rush to put into place as many rates as possible in hybrid “common carrier” agreements during the period of unavoidable delay associated with seeking public comments. Therefore, should we adopt this interpretative rule, we intend to apply the rule to all agreements entered into after the date of publication of this decision in the Federal Register . Parties are hereby placed on notice that if this proposal is adopted, the reasonableness of a rate reflected in a bilateral agreement entered into after this date will be treated as a confidential contract governed by section 10709 and outside the Board's jurisdiction.

Our proposed changes to the Code of Federal Regulations are set forth in the appendix. Parties are specifically invited to comment on the proposed rules, particularly concerning 49 CFR 1313.1(c). Parties are asked to consider whether the proposed changes would have unforeseen consequences for agricultural contracts and whether there are differences between agricultural and other types of rail transportation contracts.

Pursuant to 5 U.S.C. 605(b), the Board certifies that this action will not have a significant economic effect on a substantial number of small entities within the meaning of the Regulatory Flexibility Act.

This action will not significantly affect either the quality of the human environment or the conservation of energy resources.

For the reasons set forth in the preamble, the Surface Transportation Board proposes to amend part 1300 and 1313 of title 49, chapter x, of the Code of Federal Regulations as follows:

Atlantic tunas are managed under the dual authority of the Magnuson-Stevens Act and the ATCA. The ATCA authorizes the Secretary of Commerce (Secretary) to promulgate regulations, as may be necessary and appropriate, to implement ICCAT recommendations. The authority to issue regulations under the Magnuson-Stevens Act and the ATCA has been delegated from the Secretary to the Assistant Administrator for Fisheries, NOAA (AA).

On May 28, 1998, NMFS published in the Federal Register (64 FR 29090) final regulations, effective July 1, 1999, implementing the Fishery Management Plan for Atlantic Tunas, Swordfish, and Sharks (1999 FMP). On October 2, 2006, NMFS published in the Federal Register (71 FR 58058) final regulations, effective November 1, 2006, implementing the Consolidated Atlantic Highly Migratory Species Fishery Management Plan (Consolidated HMS FMP), which consolidates the management of all Atlantic HMS (i.e., sharks, swordfish, tunas, and billfish) into one comprehensive FMP.

The initial specifications within this proposed rule are published in accordance with the Consolidated HMS FMP and are necessary to implement the 2006 ICCAT quota recommendation, as required by the ATCA, and to achieve domestic management objectives under the Magnuson-Stevens Act. This proposed rule would: (1) Establish initial quota specifications consistent with the BFT rebuilding program by allocating the 2006 ICCAT-recommended quota for the 2007 fishing year (June 1, 2007 - December 31, 2007, pursuant to the change in fishing year to a calendar year as of January 2008 per the Consolidated HMS FMP); (2) establish General category effort controls, including time-period subquotas, restricted fishing days (RFDs), and the initial retention limit; and (3) establish Angling category retention limits for the 2007 fishing season. A minor administrative change to the permit regulations is also proposed to allow additional flexibility during conversion back from a fishing year to a calendar year.

Overall U.S. landings figures for the 2006 fishing year are still preliminary and may be updated before these 2007 fishing year specifications are finalized. The specifications and effort controls may subsequently be adjusted during the course of the fishing year, consistent with the provisions of the Consolidated HMS FMP, and, as appropriate, would be published in the Federal Register .

NMFS has prepared a draft Environmental Assessment (EA), Regulatory Impact Review (RIR), and an Initial Regulatory Flexibility Analysis (IRFA) which present and analyze anticipated environmental, social, and economic impacts of several alternatives for each of the major issues contained in this proposed rule. The complete list of alternatives and their analysis is provided in the draft EA/RIR/IRFA, and is not repeated here in its entirety. A copy of the draft EA/RIR/IRFA prepared for this proposed rule is available from NMFS (see ADDRESSES ).

At its 2006 meeting, ICCAT recommended a western Atlantic BFT Total Allowable Catch (TAC) of 2,100 mt, to allow for continued rebuilding of BFT through 2018. The TAC is inclusive of dead discards and will be effective annually for 2007 through 2008, and thereafter until changed. The following deductions are made from the TAC prior to applying the U.S. share percentage: 4 mt for the United Kingdom (in respect of Bermuda), 4 mt for France (in respect of St. Pierre and Miquelon), 25 mt for Mexico (to allow incidental catch in the longline fishery in the Gulf of Mexico), and 15 mt for Canada and 25 mt for the United States (for bycatch related to directed longline fisheries in the “in the vicinity of the management boundary area,” i.e., the Northeast Distant gear restricted area (NED), which was defined in the 2003 BFT annual specification rulemaking process as the Northeast Distant statistical area (68 FR 56783, October 2, 2003). The U.S. share of the adjusted TAC is 57.48 percent, or 1,165.12 mt. Accounting for the 25 mt NED set-aside, the total U.S. allocation is 1,190.12 mt. The previous (2002) ICCAT recommendation for a western Atlantic BFT TAC of 2,700 mt included a U.S. quota of 1,464.6 mt, which was effective from 2003 through the end of the 2006 fishing year, i.e., May 31, 2007, and also included a 25-mt NED set-aside, for a total of 1,489.6 mt.

The 2006 ICCAT recommendation also includes provisions to: (1) limit carryover of underharvest to no more than 50 percent of a contracting party's initial TAC; (2) limit mortality of school BFT to an average of 10 percent of the initial TAC, calculated on a four-year basis; and (3) allow a contracting party with a TAC allocation to make a one-time transfer within a fishing year of up to 15 percent of its TAC allocation to other contracting parties with TAC allocations, consistent with domestic obligations and conservation considerations. Regarding the third provision, the ICCAT recommendation stipulates that the quota transfer may not be used to cover overharvests, and that a contracting party that receives a one-time quota transfer may not retransfer that quota. For the United States, the 15-percent limit on quota transfer equates to 178.5 mt. In considering whether the United States could enter into an arrangement with another ICCAT contracting party, several factors would need to be taken into account, including, but not limited to, the amount of quota to be transferred, the projected ability of U.S. vessels to harvest the U.S. TAC before the end of the fishing year, the potential benefits of the transfer to U.S. fishing participants (such as access to the EEZ of the receiving contracting party for the harvest of a designated amount of BFT), potential ecological impacts, and the contracting party's ICCAT compliance status. NMFS intends to undertake any transfer of U.S. quota to another ICCAT contracting party via a separate action proposed in the Federal Register , if the situation arises.

Initial landings estimates (as of January 15, 2007) per category are as follows: General category — 159.8 mt; Harpoon category — 22.2 mt; Longline category — 31.4 mt; Angling category — 186.8 mt; Trap category — 0 mt; and Purse Seine category — 3.6 mt. These preliminary landings estimates, totaling 403.8 mt, indicate that the total 2006 underharvest is 2,435.4 mt. Underharvests per category are preliminarily determined to be as follows: General category — 1,003.5 mt; Harpoon category — 101.8 mt; Longline category — 236.6 mt; Angling category — 195.2 mt; Trap category — 5.3 mt; and Purse Seine category — 620.5 mt. Based on the estimated amount of Reserve that NMFS maintains for the landing of BFT taken during ongoing scientific research projects and/or potential overharvests in certain categories, NMFS estimates that 282.3 mt of Reserve remains from the 2006 fishing year.

In anticipation of a cap on carryover for the 2007 fishing year, i.e., 595.1 mt, or one half of the initial U.S. TAC of 1,190.12 mt, and in anticipation of a substantial underharvest of the 2006 fishing year domestic quota, the United States agreed at the 2006 ICCAT meeting to transfer a total of 275 mt of current U.S. underharvest (i.e., underharvest of the 2006 fishing year quota) as follows: 75 mt and 100 mt for 2007 and 2008, respectively, to Mexico, and 50 mt for each of the years 2007 and 2008 to Canada. Based on these transfers, the remaining amount of underharvest (as of January 15, 2007) is 2,160.4 mt. However, the ICCAT-recommended cap limits the amount the United States may carry over for 2007 to 595.1 mt.

The 1999 FMP and its implementing regulations established baseline percentage quota shares for the domestic fishing categories. These percentage shares were based on allocation procedures that NMFS developed over several years. The baseline percentage quota shares established in the 1999 FMP and contained in the Consolidated HMS FMP for fishing years beginning June 1, 1999, and continuing to the present are as follows: General category — 47.1 percent; Harpoon category — 3.9 percent; Purse Seine category — 18.6 percent; Angling category — 19.7 percent; Longline category — 8.1 percent; Trap category — 0.1 percent; and Reserve category — 2.5 percent.

These proposed initial 2007 fishing year specifications, consistent with the BFT rebuilding program, would allocate the 2006 ICCAT-recommended quota for the 2007 fishing year among the several established domestic fishing categories based on the current BFT quota allocation percentages per the Consolidated HMS FMP, and would allocate 25 mt to the longline north NED subquota.

As described further below, these specifications also would apply 595.1 mt of the underharvest of BFT quota from the 2006 fishing year, consistent with the ICCAT-recommended 50-percent cap on quota carryover to the 2007 fishing year quota, and distribute that underharvest in such a manner to: (1) Allow for potential transfer of a portion (up to 15 percent) of the 2007 U.S. quota to other ICCAT Contracting Parties, if warranted; (2) ensure that the Longline category has sufficient quota to operate during the 2007 fishing year while also considering accounting for BFT discards; and (3) provide the non-Longline quota categories a share of the remainder of the underharvest consistent with the allocation scheme established in the Consolidated HMS FMP.

Beginning with its 1998 recommendation, ICCAT has historically recommended a deduction of 79 mt from the TAC as an allowance for dead discards, and the U.S. portion of this allowance has been 68 mt. The 2006 ICCAT recommendation included neither a recommended dead discard allowance, nor specified dead discard reporting methodology for compliance purposes. Nevertheless, the United States must report dead discard estimates annually. Accordingly, NMFS must account for BFT dead discards in setting the 2007 fishing year quota.

In the past, for compliance purposes, the United States has reported dead discards to ICCAT as an estimate based on pelagic longline vessel logbook tallies, adjusted as warranted by observer data. For 2005, the most recent year for which complete information is available, the estimate is approximately 46 mt. However, based on revised methodology, the SCRS now reports dead discard estimates generated via extrapolation of logbook tallies by pooled observer data; for 2005, the estimate is approximately 131 mt. These specifications also use this revised estimate. Estimates of dead discards from other gear types and fishing sectors that do not use the pelagic longline vessel logbook are unavailable at this time and thus are not included in this calculation. Per the ICCAT recommendation, which specifies a U.S. quota that is inclusive of dead discards, and consistent with how NMFS has handled past incidents of dead discards exceeding the allowance, NMFS would deduct the 131 mt of estimated dead discards from the amount of quota available for the Longline category for the 2007 fishing year. In addition, NMFS proposes to modify the BFT quota and annual adjustment regulations at § 635.27(a) to indicate that NMFS will account for dead discards annually as part of the specifications process, and to indicate its intent to subtract that amount from the quota of the category accounting for the dead discards.

As described above, the United States may choose, pursuant to the 2006 ICCAT recommendation, to transfer up to 15 percent of the U.S. TAC to another ICCAT Contracting Party with a TAC allocation, consistent with U.S. obligations and conservation considerations. NMFS proposes to divide the 595.1 mt of quota carryover such that 178.5 mt (i.e., 15 percent of 1,190.12 mt) is placed in the Reserve for potential ICCAT transfer purposes.

NMFS also proposes to assign a sufficient amount of the quota carryover (236.6 mt) to the Longline category, due to the revised dead discard accounting methodology, so that after accounting for the 131 mt of dead discards, sufficient quota is available to cover the anticipated landings and dead discards of the pelagic longline fishery during the 2007 fishing year, i.e., potentially 200 mt. NMFS seeks to avoid a zero or negative quota for the Longline category, which could result in increased BFT discards, given that NMFS must subtract the best available dead discard estimate from the TAC on an annual basis. The Longline category baseline quota allocation (currently 8.1 percent of the TAC) may need to be revisited in the near future. Any change to the baseline allocation would require an amendment to the Consolidated HMS FMP. NMFS proposes to distribute the remainder of the quota carryover (180 mt) to the Angling, General, Harpoon, Purse Seine, and Trap categories consistent with their FMP allocations.

Consistent with the 2006 ICCAT recommendation, the proposed rule also would increase the limit on the take of school BFT (measuring 27 inches (68.6 cm) to less than 47 inches (119.4 cm)) over each 4-consecutive-year period from 8 percent of the total U.S. TAC (per the 2002 ICCAT recommendation) to 10 percent. Because the total U.S. quota is reduced by 22 percent, there will be only a minor effective increase in the base school BFT quota, in weight.

In accordance with the 2006 ICCAT quota recommendation, the Consolidated HMS FMP percentage shares for each of the domestic categories, and regulations regarding annual adjustments at § 635.27(a)(10)(ii), NMFS proposes initial quota specifications for the 2007 fishing year as follows: General category — 643.6 mt; Harpoon category — 53.3 mt; Purse Seine category — 254.1 mt; Angling category — 269.2 mt; Longline category — 200 mt; and Trap category — 1.4 mt. Additionally, 207.6 mt would be allocated to the Reserve category for inseason adjustments, scientific research collection, potential overharvest in any category except the Purse Seine category, and potential quota transfers.

Based on the above proposed initial specifications and considerations regarding the school BFT fishery, the Angling category quota of 269.2 mt would be further subdivided as follows: School BFT — 119 mt, with 45.8 mt to the northern area (north of 39°18′ N. latitude), 51.2 mt to the southern area (south of 39°18′ N. latitude), plus 22 mt held in reserve; large school/small medium BFT — 144 mt, with 68 mt to the northern area and 76 mt to the southern area; and large medium/giant BFT — 6.2 mt, with 2.1 mt to the northern area and 4.2 mt to the southern area.

The 25-mt NED set-aside quota is in addition to the overall incidental longline quota to be subdivided in accordance with the North/South allocation percentages (i.e., no more than 60 percent to the south of 31° N. latitude). Thus, the proposed Longline category quota of 200 mt would be subdivided as follows: 80 mt to pelagic longline vessels landing BFT north of 31° N. latitude and 120 mt to pelagic longline vessels landing BFT south of 31° N. latitude, with 25 mt set-aside for bycatch of BFT related to directed pelagic longline fisheries in the NED. NMFS would account for landings under this additional quota separately from other landings under the Longline north subcategory.

For the last several years, NMFS has implemented General category time-period subquotas to increase the likelihood that fishing would continue throughout the entire General category season. The subquotas are consistent with the objectives of the Consolidated HMS FMP and are designed to address concerns regarding the allocation of fishing opportunities, to assist with distribution and achievement of optimum yield, to allow for a late season fishery, and to improve market conditions and scientific monitoring.

The regulations implementing the Consolidated HMS FMP divide the annual General category quota into five time-period subquotas as follows: 50 percent for June-August, 26.5 percent for September, 13 percent for October-November, 5.2 percent for December, and 5.3 percent for January. Because the fishing year is changing back to a calendar year effective January 1, 2008, NMFS proposes, for the 2007 fishing year only, to distribute the 5.3 percent of the General category quota that would be assigned to the January time period to the four time periods that will occur during the 2007 fishing year. Therefore, of the available 643.6-mt coastwide quota, 339.8 mt would be available in the period beginning June 1 and ending August 31, 2007; 180.1 mt would be available in the period beginning September 1 and ending September 30, 2007; 88.4 mt would be available in the period beginning October 1 and ending November 30, 2007; and 35.3 mt would be available in the period beginning December 1 and ending December 31, 2007. The January 2007 BFT fishery was prosecuted using 2006 fishing year quota. The January 2008 subquota will be included in the 2008 specifications, which NMFS plans to publish prior to the start of the fishery on January 1, 2008. As discussed in the Consolidated HMS FMP, NMFS plans to work with the affected constituents through the 2008 specifications process to determine the most appropriate disposition of any under- or overharvest that has accrued in the General category by the end of December 2007.

In addition to time-period subquotas, NMFS also implements General category RFDs to extend the General category fishing season. The RFDs are designed to address the same issues addressed by time-period subquotas and provide additional fine scale inseason flexibility. For the 2007 fishing year, NMFS proposes a series of solid blocks of RFDs to extend the General category for as long as possible through the end of the 2007 fishing year.

Therefore, NMFS proposes that persons aboard vessels permitted in the General category would be prohibited from fishing, including catch-and-release and tag-and-release, for BFT of all sizes on the following days: all Saturdays and Sundays from November 17, 2007, through December 31, 2007, plus November 22 and December 25, 2007, while the fishery is open. These proposed RFDs would distribute fishing opportunities during the late season without increasing BFT mortality. NMFS' intention is to propose RFDs for January 2008 as part of the 2008 quota specifications and effort controls, scheduled to be published before January 1, 2008.

Finally, NMFS proposes to adjust the General category retention limit to three BFT (73 inches (185.4 cm) or greater per vessel per day/trip). This action is intended to allow increased opportunities to harvest the General category quota during the period when catch rates have historically been slow, and to avoid accumulation of unused quota. This retention limit would be effective from June 1, 2007, until August 31, 2007, unless adjusted with an inseason action, if necessary. NMFS may consider further retention limit adjustments after August 31, 2007, depending on several factors, including but not limited to catch rates and availablility of quota.

NMFS proposes to adjust the Angling category retention limit to one school BFT (27 inches (68.6 cm) to less than 47 inches (119.4 cm)), and two large school/small medium BFT (i.e., two BFT measuring 47 inches (119.4 cm) to less than 73 inches (185.4 cm)) per vessel per day/trip. This limit is expected to maximize use of the Angling category quota while avoiding overharvest of each of the Angling catgeory subquotas. The alternative also would provide the same retention limit for both private and charter/headboat vessels.

Because of the scheduled change to a calendar year fishery beginning January 1, 2008, and because NMFS plans to administer the permit program such that Atlantic Tunas, HMS Charter/Headboat, and HMS Angling category permits issued for the 2007 fishing year will be effective through December 31, 2008, NMFS also proposes to extend the window of opportunity to change permit categories for the 2008 fishing year, i.e., once during the period of January 1, 2008, through May 31, 2008.

This proposed rule is published under the authority of the Magnuson-Stevens Act and the ATCA. The AA has preliminarily determined that the regulations contained in this proposed rule are necessary to implement the recommendations of ICCAT and to manage the domestic Atlantic HMS fisheries.

This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

An IRFA was prepared, as required by section 603 of the Regulatory Flexibility Act. The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities. A description of the action, why it is being considered, and the legal basis for this action are contained in the preamble to this proposed rule. A summary of the analysis follows. A copy of this analysis is available from NMFS (see ADDRESSES ).

NMFS has prepared this IRFA to analyze the impacts on small entities of the alternatives for establishing 2007 fishing year BFT quotas for all domestic fishing categories and General and Angling category effort controls. The analysis for the IRFA assesses the impacts of the various alternatives on the vessels that participate in the BFT fisheries, all of which are considered small entities. In order to do this, NMFS has estimated the average impact that the alternatives to establish the 2007 BFT quota for all domestic fishing categories would have on individual categories and the vessels within those categories. As mentioned above, the 2006 ICCAT recommendation reduced the U.S. BFT TAC to 1,190.12 mt. This quota allocation includes a set-aside quota of 25 mt to account for incidental catch of BFT related to directed longline swordfish and non-BFT tuna fisheries in the NED. This action would distribute the adjusted (baseline) TAC of 1,165.1 mt to the domestic fishing categories based on the allocation percentages established in the Consolidated HMS FMP.

In 2006, the annual gross revenues from the commercial BFT fishery were approximately $3.4 million. Approximately 8,751 vessels are permitted to land and sell BFT under four commercial BFT quota categories (including charter/headboat vessels). The commercial categories and their 2006 gross revenues are General ($2.5 million), Harpoon ($265,951), Purse Seine ($33,819), and Longline ($558,022). The IRFA assumes that vessels within a category will have similar catch and gross revenues in order to consider the relative impact of the various preferred alternatives on vessels. Data on net revenues of individual fishermen are lacking, so the economic impact of the alternatives is averaged across each category. NMFS considers this a reasonable approach for BFT fisheries. More specifically, available landings data (weight and ex-vessel value of the fish in price/pound) allow NMFS to calculate the gross revenue earned by a fishery participant on a successful trip. The available data do not, however, allow NMFS to calculate the effort and cost associated with each successful trip (e.g., the cost of gas, bait, ice, etc.) so net revenue for each participant cannot be calculated. NMFS cannot determine whether net revenue varies among individual fishery participants within each category, and therefore whether the economic impact of a regulation would have a varying impact among individual participants. As a result, NMFS analyzes the average impact of the proposed alternatives among all participants in each category.

For the allocation of BFT quota among domestic fishing categories, NMFS considered three alternatives: A no action alternative (A1); Alternative A2 (the preferred alternative), which would implement the 2006 ICCAT recommendation; and Alternative A3, which would allocate the 2006 ICCAT recommendation in a manner other than that designated in the Consolidated HMS FMP and which could address issues regarding the changing nature of the BFT fisheries (e.g., allocate additional quota to certain categories and/or certain geographic regions). Alternative A3 would result in a de facto quota reallocation among categories, and an FMP amendment would be necessary for its implementation. Per the Consolidated HMS FMP, NMFS prepares quota specifications annually for the upcoming fishing year. Preparation of an FMP amendment would not be possible in the brief period of time between receipt of the ICCAT recommendation, which occurred in late November 2006, and the start of the 2007 fishing year on June 1, 2007. Therefore, analysis of the impacts of Alternative A3 is not available. But, if an FMP amendment was feasible, positive economic impacts would be expected to result on average for vessels in permit categories that would receive a greater share than established in the FMP, and negative economic impacts would be expected to result on average for vessels in permit categories that would receive a lesser share than established in the FMP. Impacts per vessel would depend on the temporal and spatial availability of BFT to participants.

As noted above, the preferred alternative (Alternative A2) would implement the 2006 ICCAT recommendation in accordance with the Consolidated HMS FMP and consistent with the ATCA, under which the United States is obligated to implement ICCAT-approved quota recommendations. Alternative A2 would have slightly positive impacts for fishermen. The no action alternative would keep the quota at pre-2006 ICCAT recommendation levels (approximately 300 mt more) and would not be consistent with the purpose and need for this action and the Consolidated HMS FMP. It would maintain economic impacts to the United States and to local economies at a distribution and scale similar to 2006 or recent prior years, and would provide fishermen additional fishing opportunities, subject to the availability of BFT to the fishery, in the short term.

The preferred alternative also would implement the provision of the 2006 ICCAT recommendation that limits tolerance for school BFT landings to 10 percent of the U.S. TAC, calculated on a four-year average. This is expected to have neutral impacts on fishermen who fish for school BFT, particularly those who rely exclusively on the school size class for BFT harvest, since the available quota is the same as the level when the limit was 8-percent of the U.S. TAC under the 2002 ICCAT recommendation.

Two alternatives were considered for effort control using RFDs in the General category. The no action alternative would not implement any RFDs with publication of the initial specifications but rather would use inseason management authority established in the Consolidated HMS FMP to implement RFDs during the season, should catch rates warrant taking this approach. This alternative could be most beneficial during a season of low catch rates and could have positive economic consequences if slow catch rates were to persist during the late season fishery. During a slow season, the season could regulate itself and fishermen could choose when to fish or not based on their own preferences. However, it is impossible to predict in advance whether the season will have low or high catch rates.

The preferred alternative would designate RFDs according to a schedule published in the initial BFT specifications. In the past, when catch rates have been high, the use of RFDs (preferred alternative) has had positive economic consequences by avoiding oversupplying the market and extending the season as late as possible. In addition, establishing RFDs at the season onset provides better planning opportunities than implementing RFDs during the season, since charter/headboat businesses could book trips and recreational and commercial fishermen could make plans ahead of time rather than waiting until the last minute to see if an RFD is going to be implemented. However, implementing RFDs to extend the late season may have some negative economic impacts to northern area fishermen who choose to travel to the southern area during the late season fishery. Travel and lodging costs may be greater if the season were extended over a greater period of time as proposed under the preferred alternative. Those additional costs could be mitigated if the ex-vessel price of BFT stays high, as is intended under this alternative. Without RFDs, travel costs may be less because of a shorter season; however, the market could be oversupplied and ex-vessel prices could fall. Overall, extending the season as late as possible and establishing formalized RFDs at the season onset would enhance the likelihood of increasing participation by southern area fishermen, increase access to the fishery over a greater range of the fish migration, provide a reliable mechanism for slowing a fishery that has an ability to generate extremely high catch rates, and is expected to provide better than average ex-vessel prices with an overall increase in gross revenues.

A retention limit of three BFT (measuring 73 inches (185.4 cm) or greater per vessel per day/trip) is the preferred alternative for the opening retention limit for the General category, which would be in effect through August 31, 2007. This alternative is expected to result in the most positive socio-economic impacts by providing the best opportunity to harvest the quota while avoiding oversupplying the market, thus maximizing gross revenues. Other considered alternatives were the no action alternative (one BFT measuring 73 inches or greater per vessel per day/trip) and a retention limit of two BFT (73 inches or greater per vessel per day/trip). Both of these alternatives are expected to be too restrictive given the large amount of quota available for the General category during the 2007 fishing year and could result in the negative economic impact of lower gross revenues. Although early season landings seldom occur at a rate that could oversupply the market, NMFS will monitor landings closely to ensure that the increased retention limit does not contribute to an oversupply.

Six alternatives were considered for Angling category retention limits for the 2007 fishing year. The preferred alternative (D1b) is a three BFT retention limit (two fish measuring 47 inches (119.4 cm) to less than 73 inches (185.4 cm) and one fish measuring 27 inches (68.6 cm) to less than 73 inches) per vessel per day/trip for all sectors of the Angling category for the entire 2007 fishing year. The other two alternatives providing the same daily retention limits (per vessel) for both private recreational and charter/headboats were the no action alternative (D1a, i.e., one fish measuring 27 inches to less than 73 inches) and Alternative D1c (two fish measuring 47 inches to less than 73 inches and two fish measuring 27 inches to less than 73 inches). Alternative D1a was not preferred because it could unnecessarily restrict the amount of Angling category landings which could result in an underharvest of the quota and a negative economic impact. Alternative D1c was not preferred because it could result in an overharvest of the quota, with negative economic consequences.

Three other alternatives were considered that would provide different retention limits for the Angling category sectors. The first (D2a) would allow a private vessel daily retention limit of three fish (two measuring 47 inches to less than 73 inches and one measuring 27 inches to less than 47 inches) and a charter/headboat daily retention limit (per vessel) of five fish (three fish measuring 47 inches to less than 73 inches and two fish measuring 27 inches to less than 47 inches). The second alternative (D2b) would allow three fish (two measuring 47 inches to less than 73 inches and one measuring 27 inches to less than 47 inches) for each vessel per day/trip for the season, with an increase to five fish (three measuring 47 inches to less than 73 inches and two measuring 27 inches to less than 47 inches) per vessel for charter/headboats during June 15, 2007 through July 31, 2007, and the month of September 2007. The third alternative (D2c) would allow two fish (measuring 27 inches to less than 73 inches) less than 47 inches) for each vessel per day/trip for the season, with an increase to three fish (measuring 27 inches to less than 73 inches) per vessel for charter/headboats during June 15, 2007 through July 31, 2007, and the month of September 2007. Alternatives D2a and D2b were considered to be potentially too liberal with a greater potential for exceeding the Angling category quota for 2007. Alternative D2c was considered to be unnecessarily restrictive with a greater potential for negative economic impacts associated with not harvesting the entire quota. In addition, the D2 subalternatives were not preferred since they could result in perceived inequities between the two sectors of the Angling category fishery.

The preferred alternative (D1b) was selected to balance the intent of landing the Angling category quota without overharvesting, providing sufficient retention limits to offset costs, reducing any perceived inequities between the charter/headboat and private recreational vessel sectors of the Angling category fishery, and providing economic benefits to all regional sectors of the fishery.

There are no new reporting or recordkeeping requirements contained in any of the alternatives considered for this action. This proposed rule has also been determined not to duplicate, overlap, or conflict with any other Federal rules.

For the reasons set out in the preamble, 50 CFR part 635 is proposed to be amended as follows:

1. The authority citation for part 635 continues to read as follows:

2. In § 635.4, paragraph (j)(3) is revised to read as follows:

3. In § 635.27, paragraphs (a) introductory text, (a)(1)(i), (a)(2), (a)(3), (a)(4)(i), (a)(5), (a)(6), (a)(7)(i), (a)(7)(ii), (a)(10)(iii), and (a)(10)(iv) are revised to read as follows: