[Federal Register Volume 74, Number 199 (Friday, October 16, 2009)]
[Rules and Regulations]
[Pages 53368-53395]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-24821]



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Part III





Department of Transportation





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Federal Aviation Administration



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14 CFR Parts 1, 21, 43, et al.



Production and Airworthiness Approvals, Part Marking, and Miscellaneous 
Amendments; Final Rule

  Federal Register / Vol. 74 , No. 199 / Friday, October 16, 2009 / 
Rules and Regulations  

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 1, 21, 43, and 45

[Docket No. FAA-2006-25877; Amendment Nos. 1-64, 21-92, 43-43, and 45-
26]
RIN 2120-AJ44


Production and Airworthiness Approvals, Part Marking, and 
Miscellaneous Amendments

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: The FAA is amending its certification procedures and 
identification requirements for aeronautical products and articles. The 
amendments will update and standardize those requirements for 
production approval holders (PAHs), revise export airworthiness 
approval requirements to facilitate global manufacturing, move all part 
marking requirements from part 21 to part 45, and amend the 
identification requirements for products and articles. The intent of 
these changes is to continue to promote safety by ensuring that 
aircraft, and products and articles designed specifically for use in 
aircraft, wherever manufactured, meet appropriate minimum standards for 
design and construction. As a result of this action, the FAA's 
regulations now better reflect the current global aircraft and aircraft 
products and articles manufacturing environment.

DATES: This rule is effective April 14, 2010.

FOR FURTHER INFORMATION CONTACT: For technical questions concerning 
this rule, contact Barbara Capron and/or Robert Cook, Production 
Certification Branch, AIR-220, Federal Aviation Administration, 800 
Independence Avenue, SW., Washington, DC 20591; telephone (202) 385-
6360 or (202) 385-6358; e-mail: [email protected] or 
[email protected]. For legal questions concerning this rule, contact 
Angela Washington, AGC-210, Office of the Chief Counsel, Federal 
Aviation Administration, 800 Independence Avenue, SW., Washington, DC 
20591; telephone (202) 267-7556; e-mail: [email protected].

SUPPLEMENTARY INFORMATION: 

Authority for this Rulemaking

    Under the laws of the United States, the Department of 
Transportation has the responsibility to develop transportation 
policies and programs that contribute to providing fast, safe, 
efficient, and convenient transportation (49 United States Code, 
Subtitle 1, Sec.  101). The Federal Aviation Administration (FAA or 
``we/us/our'') is an agency of the Department. The FAA has general 
authority to issue rules regarding aviation safety, including minimum 
standards for articles and for the design, material, construction, 
quality of work, and performance of aircraft, aircraft engines, and 
propellers (49 U.S.C. 106(g) and 44701). We may also prescribe 
regulations in the interest of safety for registering and identifying 
an aircraft engine, propeller, or article (49 U.S.C. 44104).
    The FAA is amending its regulations governing the certification 
procedures for products and articles and its requirements for 
identification and registration marking. These changes will improve the 
quality standards applicable to manufacturers, which help ensure that 
products and articles are produced as designed and are safe to operate. 
We are also relocating and standardizing our requirements for marking 
articles intended for use in aviation. These changes will make it 
easier to determine whether the correct articles are installed, which 
will contribute to a greater degree of safety. For these reasons, this 
rule will be a reasonable and necessary exercise of our rulemaking 
authority and obligations.

Table of Contents

I. Background
II. Discussion of the Final Rule
    A. Summary of Amendments
    B. Miscellaneous Requirements
    C. Compliance Dates
III. Regulatory Notices and Analyses
IV. Amendments

I. Background

    Over the last several decades, the aircraft manufacturing industry 
has evolved significantly. Years ago, most transport category aircraft 
were manufactured in the United States. A typical business model 
consisted of a production certificate (PC) holder with a relatively 
small number of suppliers. Today, the number of aircraft manufacturing 
suppliers has increased dramatically. Conversely, through the years, 
the aircraft industry has seen a steady decline in the number of U.S.-
based transport category aircraft manufacturers. Those manufacturers, 
who once predominantly oversaw the production of replacement articles 
for their aircraft, now witness the ever increasing production of 
replacement and modification articles by independent parts 
manufacturers. Suppliers, including parts manufacturers, were located 
mainly in the United States decades ago; now, they are located all over 
the world. Suppliers are manufacturing greater percentages of aircraft 
products and articles. As a result, aircraft are now manufactured in an 
increasingly global environment.
    The FAA did not envision such an expansion in aircraft 
manufacturing when the certification rules were first promulgated in 
1964. The industry has been the subject of burgeoning 
internationalization in the last several decades. Evidence of this fact 
is that now, more than ever before, the United States has more 
bilateral agreements with foreign civil airworthiness authorities 
addressing the production, import, and export of aircraft. The old 
certification rules are too restrictive to accommodate today's 
manufacturing paradigm. Removing some of those restrictions will 
greatly improve our regulatory efficiency. This final rule is the FAA's 
response to the changing dynamics of the aircraft manufacturing 
industry, and this final rule contains requirements that reflect the 
current global environment.
    The evolution of the manufacturing industry prompted the FAA to 
publish in the Federal Register a notice of proposed rulemaking (NPRM) 
on ``Production and Airworthiness Approvals, Parts Marking, and 
Miscellaneous Proposals'' (71 FR 58914, October 5, 2006). In that 
notice, we proposed comprehensive changes to certification procedures 
and identification requirements for aeronautical products and articles. 
In general, we proposed to: (1) Standardize quality system requirements 
for all Production Approval Holders (PAH); (2) require PAHs, including 
those producing under Type Certificate, to mark all articles, including 
sub-assemblies and components; (3) require PAHs to issue airworthiness 
approvals for aircraft engines, propellers, and other aviation 
articles; (4) require PAHs to create a certifying staff to issue those 
approvals; and (5) revise export airworthiness approval requirements to 
facilitate global manufacturing. The NPRM contains the background and 
rationale for this final rule, and except where we have made revisions 
to the proposal in this document, you should refer to the NPRM for that 
information.
    Commenters to the NPRM represented aircraft and parts 
manufacturers; repair stations; the U.S. Small Business Administration, 
Office of Advocacy (SBA's Office of Advocacy); industry groups; and 
other civil aviation authorities and individuals. While there was much 
support for the general intent

[[Page 53369]]

of the proposed rule changes, the largest percentage of the commenters 
opposed the following four specific proposals:

1. Identification Requirements for Parts, Appliances, and Technical 
Standard Order Articles

    The NPRM proposed to require manufacturers to mark each component 
of an aircraft engine or propeller, each part and component thereof, 
and each appliance and component thereof. Until now, the FAA has only 
required marking of the part; not the individual components of the 
part. Over forty commenters rejected the proposal, stating that the 
requirement to mark each component would be cost prohibitive. Also, the 
proposal would necessitate a change in all associated drawings and 
design data to reflect the marking requirement.

2. Mandatory Issuance of Airworthiness Approvals for Each Aircraft 
Engine, Propeller, and Article

    The NPRM contained a proposal that would have required PAHs to 
issue an airworthiness approval for each aircraft engine, propeller, or 
article produced under the production approval that conforms to its 
approved design and is in a condition for safe operation. Currently, 
and under the old rules, an airworthiness approval is mandatory for 
products and articles only when those products and articles are being 
exported. The FAA has never required that airworthiness approvals be 
issued domestically. Commenters stated that because a 
disproportionately larger number of aircraft engines, propellers, and 
articles are shipped domestically than are exported, mandatory issuance 
of airworthiness approvals would impose a substantial cost burden on 
manufacturers.

3. Creation of Certifying Staff To Issue Airworthiness Approvals

    We proposed in the NPRM to require PAHs to develop procedures for 
establishing and maintaining certifying staff that would be responsible 
for issuing airworthiness approvals for aircraft engines, propellers, 
and articles, including the issuance of export airworthiness approvals. 
Presently, only the FAA or its designees issue airworthiness approvals. 
Commenters opposed this requirement, arguing that it would necessitate 
additional staff training and implementation of new procedures for 
manufacturers, thus unnecessarily escalating the cost of manufacturing.

4. Standardized Quality System Requirements

    In the NPRM, we proposed to standardize quality system requirements 
for PAHs so that all PAHs comply with the same set of quality system 
requirements, regardless of the product or article produced. We 
received over 65 comments (including those from the SBA's Office of 
Advocacy; industry groups representing manufacturers, airlines, and 
pilots; and aircraft, aircraft engine, and aircraft parts 
manufacturers). An overriding concern of the commenters was that the 
quality system requirements, if adopted, would be burdensome to 
implement, particularly for small businesses. Commenters asserted that 
the requirements would impose substantial additional costs on industry 
with no measurable increase in safety.
    In addition to the commenters noted above, there were commenters on 
other proposals in the NPRM. We received over 100 comment letters (with 
over 500 comments) in response to the NPRM. After evaluating all 
comments received, we proceeded with this rulemaking action.

II. Discussion of Final Rule

A. Summary of Amendments

1. Identification Requirements
    In response to the concerns and issues raised, the FAA has 
reconsidered some of its proposals and made several substantive changes 
to the proposed regulatory text. Our most significant change pertains 
to the proposal to require marking of all component parts and 
appliances. Fifty-two commenters (including SBA's Office of Advocacy; 
industry groups representing manufacturers, airlines, and pilots; and 
aircraft, aircraft engine, and aircraft parts manufacturers) asserted 
the proposed requirement to mark detail parts would be cost prohibitive 
and would provide no verifiable safety benefit. Commenters pointed out 
some products or articles consist of hundreds or sometimes thousands of 
detail parts, arguing that the costs associated with changing the 
drawings and design data could cost small businesses over one billion 
dollars to implement.
    When we performed our initial regulatory flexibility assessment 
(IRFA) for the NPRM, we did not recognize the extent to which design 
data would have to be changed in order to accommodate the proposed 
marking of detail parts. Given that each product or article consists of 
hundreds or thousands of sub-tiered drawings, all of which would have 
to be changed, we agree with the commenters that we put forth a cost-
prohibitive proposal. Accordingly, the final rule does not contain this 
requirement.
    As a result of the many comments in opposition to our marking 
proposal, we revised the proposed rule to provide for methods of 
identification more flexible than marking. PAHs must mark the product 
or article that they have been granted a certificate or approval for in 
accordance with part 45. However, the sub-assemblies and component 
parts of that product or article do not have to be marked or identified 
unless they leave the PAH's facility as a separate article (e.g., 
replacement or modification part). Sub-assemblies, component parts, or 
replacement articles that leave the PAH's facility as FAA-approved must 
include the manufacturer's part number and name, trademark, symbol, or 
other FAA-approved PAH identification (e.g., the production approval 
number, cage code, or Federal supply code for manufacturers (FSCM)). A 
manufacturer or person producing under subparts F, G, K, or O may 
choose any method to meet this requirement. Methods include, but are 
not limited to, marking the article, attaching a tag to the article, 
placing the article in a container, or providing a document with the 
article with the information previously mentioned. This identification 
requirement codifies current industry practice and is less stringent 
than the proposed requirement.
    This identification requirement is not driven by a history of 
aviation accidents where inadequate marking or identification was 
necessarily found to be a primary cause; rather, it is part of a 
systemic approach to safety. Accident investigations and safety 
management system analyses show that accidents are rarely caused by one 
event. Accidents are the result of a chain of events. If any of the 
events had not occurred, an accident may have been prevented. This 
requirement assists in the traceability of articles and helps reduce 
the installation of incorrect articles, thereby preventing accidents.
    Because identification of articles is simply a byproduct of the 
marking proposal, the FAA has determined that it is within the scope of 
this rulemaking. The economic effects of this requirement have been 
evaluated and determined to be cost-neutral (i.e., having no economic 
impact).
    In the NPRM, we proposed to revise Sec.  45.15 to specify 
particular marking requirements for parts manufacturer approval (PMA) 
and technical standard order (TSO) articles. In doing so, we removed 
the former requirements for producers of PMA articles to mark those

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articles with the designation ``FAA-PMA'' and information stating the 
installation eligibility of the article. As proposed, the rule would 
have required PMA holders to mark articles with the PMA holder's name, 
trademark, symbol, or other FAA-approved identification.
    Several commenters (including Airline Transport Association (ATA), 
Aerospace Industries Association (AIA), General Electric Company (GE), 
the Boeing Company, and Snecma) questioned the proposal. They stated 
the current requirement to mark PMA articles with the letters ``FAA-
PMA'' increases traceability and allows installers and maintenance 
providers to easily identify the article being installed. The European 
Aviation Safety Agency (EASA) stated it had recently introduced a 
requirement for the marking of parts not produced under the control of 
a TC or supplementary type certificate (STC). The marking clearly 
distinguishes those parts from parts produced by a TC or STC holder. 
EASA suggested the FAA and EASA coordinate their efforts in developing 
a coherent, consistent, and comprehensive part marking policy.
    The FAA does not espouse an opinion regarding the premise that 
marking PMA articles as ``FAA-PMA'' increases traceability. However, 
having a marking requirement consistent with the requirement of other 
aviation authorities is advantageous and enhances harmonization 
efforts. Furthermore, as we reviewed the proposal, we realized the 
removal of ``FAA-PMA'' would result in additional costs to the PMA 
holder. Much like the proposal to mark detail parts, the removal of 
``FAA-PMA'' would require a manufacturer to revise all of its design 
drawings, making it a cost-prohibitive change. Accordingly, this final 
rule retains the current ``FAA-PMA'' marking requirements.
    Unless otherwise specified in the applicable TSO, Sec.  45.15 now 
requires manufacturers of TSO articles to permanently and legibly mark 
the article with the TSO number and letter of designation, all markings 
specifically required by the applicable TSO, and the serial number or 
the date of manufacture of the article, or both. Likewise, each person 
who manufactures a part or component for which a replacement time, 
inspection interval, or related procedure is specified in the 
Airworthiness Limitations section of a manufacturer's maintenance 
manual or Instructions for Continued Airworthiness must permanently and 
legibly mark that part or component with a serial number (or 
equivalent).
    An individual commenter expressed concern that requiring a 
manufacturer to permanently mark an article may result in masking the 
age of a product. The commenter argued that a manufacturer could modify 
an existing appliance and issue it a new serial number and date of 
manufacture. The commenter recommended the proposal be revised to 
prohibit such activity. We understand the commenter's concern; however, 
the original serial number and date of manufacture must be maintained 
throughout the TSO article's life-cycle. We think the regulation is 
sufficiently clear that markings must be permanent. Additional markings 
must not obscure, remove, or obliterate the original markings.
    GE and Pratt & Whitney stated that the phrase ``or equivalent,'' 
when used to refer to an alternative to marking a part or component 
with a serial number, is confusing and should not be in the final rule. 
We disagree. Use of the phrase ``or equivalent'' offers flexibility in 
compliance with the marking requirement and provides an assessable 
standard for FAA enforcement of the requirement. Therefore, we retained 
the phrase in the final rule.
    Section 45.11 now provides relief to aircraft owners and operators 
for data plate location requirements for gliders and certain types of 
aircraft. This rule allows the data plate to be secured in an 
accessible location near the aircraft entrance. The former rule 
required the data plate be secured to the aircraft fuselage exterior, 
such that it was legible to a person on the ground. However, the old 
requirements were impractical. Over the last several years, the FAA has 
issued numerous exemptions from Sec.  45.11 for relief from the 
requirements for data plate location. This rule relieves the burden on 
the public and the FAA in regards to processing these types of 
exemptions in the future.
    AIA and GE stated that the proposed requirement to mark engine 
modules was unclear. They questioned whether the module marking should 
reflect the engine's information or the module's information. Also, GE 
stated that an additional identification plate should be added to a 
module when an STC has been incorporated. We have determined that the 
requirement to mark engine modules is unnecessary. The rule language 
has been changed to remove this requirement. We do not agree that 
additional marking is required when an STC is incorporated. While an 
STC is used for the approval of a major change in the type design, it 
does not approve the production of parts used in the modification. The 
data plate placed on a TC product is based on the manufacturer of the 
product, rather than the TC design approval holder (DAH). Requiring 
additional markings for STC incorporation would confuse the STC holder 
with the actual manufacturer of the STC modification part. It also 
would not provide any safety benefit. STC incorporation is marked in 
aircraft logbooks and flight manuals and has been shown effective.
    A repair station expressed concern about changes to articles driven 
by service bulletins. Articles for which service bulletins have been 
issued often require a new or revised marking. Since many of these 
articles are in service, the maintenance provider, not the producer, 
makes the required changes. Therefore, the commenter requested that the 
FAA create a regulatory provision permitting maintenance providers to 
act as the manufacturer's agent for the purpose of remarking the 
article.
    Changes to articles pursuant to service bulletins are governed by 
the provisions of part 43. Those changes, including the marking of the 
articles, are considered maintenance activity and are more 
appropriately accomplished pursuant to the maintenance provisions of 
part 43.
    If the FAA finds a part or component is too small or otherwise 
impractical to mark with any of the information required by this part, 
the manufacturer is required to attach that information to the part or 
component, or its container. Aircraft Owners and Pilots Association 
(AOPA) commented that an enormous workload is imposed on the FAA 
because it must determine whether an article is too small or is 
otherwise impractical to mark. AOPA recommended that the manufacturer 
be allowed to make that determination.
    The FAA is ultimately responsible for determining compliance with 
regulatory requirements, and we must ensure consistency in application 
of the standard. Therefore, we will not abdicate our responsibility for 
determining whether articles are too small or otherwise impractical to 
mark.
    Marking requirements for all PAHs are now consolidated in part 45. 
These requirements apply to all PAHs, as well as to persons who produce 
the products or articles for export to the United States under the 
provisions of an agreement between the United States and another 
country or jurisdiction. The required markings constitute a 
representation that the product or article conforms to its approved 
design. Only the person authorized to produce the product or article 
may make this representation. However, this rule does not preclude an 
approved supplier to a PAH from applying markings in accordance with 
requirements imposed by the PAH;

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neither does it preclude applying in-process markings throughout the 
manufacturing process.
    AIA, ATA, GE, and Pratt & Whitney stated the FAA should permit 
marking by owner operators, certificated repair stations, or 
appropriately certificated mechanics performing maintenance under part 
43. However, part 43 already allows owner/operators, certificated 
repair stations, and certificated mechanics performing maintenance to 
mark articles, and addressing it in this rulemaking would be 
duplicative and unnecessary.
    A parts manufacturer and an individual questioned whether using 
barcodes would be an acceptable means of complying with the rule, 
particularly in the case of small articles. Barcode identification may 
be used in conjunction with, but not in lieu of, the marking 
requirements. Provisions for marking small or delicate articles are 
specified in Sec.  45.15(d).
2. Mandatory Issuance of Airworthiness Approvals and Certifying Staff
    Forty-six commenters (including SBA's Office of Advocacy, industry 
groups, aircraft manufacturers, engine manufacturers, parts 
manufacturers, and individuals) stated that FAA's proposal to require 
the issuance of airworthiness approvals for each aircraft engine, 
propeller, or article would be cost prohibitive. Commenters stated that 
because a disproportionately larger number of aircraft engines, 
propellers, and articles are shipped domestically than are exported, 
mandatory issuance of airworthiness approvals would impose a 
substantial cost burden on manufacturers.
    We have further reviewed the potential impact of the proposal and 
have determined that the costs would disproportionately affect small 
manufacturers. Many small manufacturers do not ship their products or 
articles outside the United States, nor do they currently issue 
airworthiness approvals. In addition, airworthiness approvals are often 
separated from the product or article when it is received by the end 
user, nullifying the safety aspect of increased traceability. Because 
we have determined that the mandatory issuance of airworthiness 
approvals will not increase safety, and there is a high cost associated 
with its implementation, that proposal is not included in this final 
rule.
    We also have determined that mandating PAHs to establish and 
maintain a certifying staff to issue airworthiness approvals would 
necessitate costly staff training, and implementation of new procedures 
would be too burdensome for manufacturers. Because we have not included 
the proposed requirement for mandatory issuance of airworthiness 
approvals for each aircraft engine, propeller, and article, the 
requirement for a PAH to establish and maintain a certifying staff to 
issue the approvals is therefore not included in this rule.
3. Quality System Requirements
    This final rule prescribes a PAH's requirements for controlling the 
quality of the product or article it manufactures. The FAA has imposed 
in this final rule certain additional PAH quality system requirements 
designed to achieve overall improvement of the PAH's quality system. 
The quality system consists of fourteen specific quality system 
requirements. As described below, it is important to note that those 
fourteen quality system requirements are scalable, depending on the 
size and complexity of the PAH and of the product or article produced. 
Some of these requirements were already mandatory prior to this 
rulemaking and have been retained. The remaining requirements also have 
already been incorporated by industry for years and used voluntarily as 
``best practices.''
    Prior to this rulemaking, holders of different production approvals 
complied with, and were audited to, differing sets of requirements. For 
instance, if a manufacturer produced a PMA part and a TSO article, the 
manufacturer was subject to different quality and marking standards for 
each part it produced. Today's requirements are now applicable to PC 
and PMA holders and TSO authorizations alike. This final rule relieves 
PAHs from having to maintain, and the FAA from having to oversee, 
multiple PAH systems and procedures. Hence, this final rule will 
increase regulatory efficiency.
    We received over 65 comments (including those from the SBA's Office 
of Advocacy; industry groups representing manufacturers, airlines, and 
pilots; and aircraft, aircraft engine, and parts manufacturers). A 
general consensus of the commenters was that the proposed quality 
system requirements would be too restrictive, burdensome, and costly, 
especially on small businesses.
    SBA's Office of Advocacy believed the FAA's approach was more 
appropriate for large companies, rather than for smaller companies. 
That commenter suggested the FAA consider exempting small businesses 
from the quality system requirements or adopt a tiered approach based 
on the size and volume of the business. In addition, SBA's Office of 
Advocacy suggested that if the FAA does not intend to require an 
International Organization for Standardization (ISO)- or SAE-equivalent 
regime, then it should delete the references to those standards in the 
preamble. In the NPRM, we likened our quality system requirements to 
those international quality standards and suggested that there is a 
global trend toward implementing them. SBA's Office of Advocacy argued 
the FAA should not impose ISO- or AS-based requirements of advocacy, 
maintaining that such a requirement would be duplicative because many 
PAHs have already achieved ISO or AS certification.
    The FAA derived its quality system requirements from a number of 
sources, including previous requirements in subparts G and K, as well 
as industry best practices, ISO standards, and other aviation 
authorities' requirements (e.g., Joint Aviation Authorities (JAA), 
European Aviation Safety Agency (EASA), and Transport Canada). These 
requirements do not introduce significantly different standards for 
PAHs, small businesses included. Because many PAHs currently employ 
these standards as best practices, the FAA has determined that 
compliance will not be costly. We have determined that the quality 
system requirements, as proposed, are appropriate for all 
manufacturers.
    In response to the SBA's Office of Advocacy's comment suggesting 
the FAA adopt a tiered approach for small businesses, the FAA maintains 
that even small businesses have many of these practices in place, just 
on a smaller scale than larger aircraft manufacturers. We are simply 
codifying those practices. Our requirements are consistent for all 
manufacturers, but they will be scalable and commensurate to the size 
of the company and the complexity of the product or article produced. 
For example, we would expect a large aircraft manufacturer to have a 
well-developed, complex quality system. In contrast, a small parts 
manufacturer producing a non-complex article could have a less complex 
quality system.
    However, that system could still comply with FAA quality system 
regulations and reflect the needs of the PAH without imposing an undue 
burden. The FAA will provide additional information on the Internet 
site http://www.faa.gov on how a PAH may construct a scalable quality 
system, to include examples.
    In addition to industry best practices, these amended quality 
system requirements are now consistent with

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requirements of other aviation authorities. As a result, these quality 
system requirements will encourage greater international acceptance of 
products and articles and facilitate the import and export of those 
products and articles.
    This rule also requires that a manufacturer's quality system 
include procedures for controlling the use of design data and 
subsequent changes to ensure that only current, correct, and approved 
data are used. Earlier, we had proposed that the system include 
procedures for controlling design data, rather than the use of the 
data. However, GE correctly commented that the TC holder, not the PAH, 
controls the design data. Accordingly, we revised the rule language to 
accommodate that fact. We now require PAHs to have access to design 
data necessary to determine conformity and airworthiness for each 
product and article produced under the PC. In the case of a PAH who 
obtained approval by test and computation, the PAH controls the data. 
However, a PAH who obtained approval by licensing agreement might only 
have access to the data through the type design holder.
    This rule now requires manufacturers to establish procedures to 
control conformity of each supplier-furnished product or article to its 
approved design before release for installation. The PAH must establish 
a quality system that ensures the products or articles produced are 
conforming and in a condition for safe operation. In that regard, we 
have identified Supplier Control as one of the processes for which the 
PAH must establish procedures. The PAH is responsible for determining 
the type and scope of controls and the frequency of oversight necessary 
to ensure the conformity of the products or services provided by its 
supply chain, along with its compliance to contract requirements.
    We further require that the quality system include procedures for 
inspections and tests to ensure that a product or article conforms to 
its approved design. This revision clarifies that the purpose of 
inspections and tests is to verify that each product and article 
conforms to its approved design and is in a condition for safe 
operation. In addition, the inspection and test procedures must include 
a flight test of each aircraft produced, unless that aircraft will be 
exported as an unassembled aircraft, and a functional test of each 
aircraft engine and each propeller must be performed. Embraer 
questioned the benefit of performing a functional test on a fixed pitch 
propeller because it has no control system. For that reason, Embraer 
proposed we create an exception to exclude fixed pitch propellers from 
functional testing; however, we disagree. Inspections and tests, 
including functional tests, must be performed on fixed pitch 
propellers. These tests are used to validate whether performance 
characteristics and the structural integrity meet the design 
requirements.
    The quality system must include procedures to ensure that all 
inspection, measuring, and test equipment used to determine conformity 
of products and articles is calibrated and controlled. Each calibration 
standard must be traceable to a standard acceptable to the FAA. Boeing 
suggested we require calibration of inspection, measuring, and test 
equipment only when calibration is specified by the type design. 
However, calibration of inspection, measuring, and test equipment is a 
function of the quality system; it is not addressed in the type design. 
Proper calibration of all equipment helps ensure the integrity of the 
manufacturing process.
    This rule now requires that a quality system include procedures to 
ensure that discarded articles are rendered unusable. This revision 
helps ensure that discarded articles are not erroneously placed into 
service on aircraft. AIA, GE, and Boeing proposed that the FAA allow 
PAHs to identify articles as ``scrap,'' rather than the PAH rendering 
discarded articles as ``unusable''. The commenters further recommended 
that we define the term ``scrap'' in the rule.
    The term ``scrap'' is an acceptable industry term that may be used 
at the PAH's discretion, but many times, PAH's may use ``scrapped'' 
items in a new capacity. The term ``scrap'' does not clearly convey 
that the item may not be reused in a type-certificated product. For the 
purposes of this rule, we have decided that the term ``unusable'' 
clearly reflects our intent to ensure that an article that has been 
discarded cannot be used.
    In addition, this rule requires that the quality system include 
procedures to prevent damage or deterioration of products and articles 
during handling, storage, preservation, packaging, and delivery. AIA, 
GE, and Pratt & Whitney argued that the PAH cannot ensure the condition 
of articles after they have left the PAH's facility, and they 
recommended that we remove the term ``delivery'' from the proposed rule 
language. We agree and have revised the regulatory text accordingly.
    Pratt & Whitney also recommended revising the rule language to 
reflect that the quality system include procedures ``intended'' to 
prevent damage and deterioration of products and articles, as opposed 
to procedures that will prevent damage and deterioration. However, the 
FAA is responsible for imposing a standard that is measurable. We have 
determined that the standard imposed will better prevent damage or 
deterioration. Thus, we have retained the rule language as proposed.
    The FAA now requires the quality system to include procedures for 
identifying, storing, protecting, retrieving, and retaining quality 
records. Quality system records include inspection and test records, 
material review board records, and work orders. Both production 
approval applicants and PAHs must retain these records for at least 
five years for the products and articles manufactured under the 
approval and at least ten years for those articles that are identified 
as critical components under Sec.  45.15(c) of this chapter.
    GE recommended we increase the record retention time to 40 years. 
An individual commenter stated that the former record retention 
requirements were adequate. However, the new record retention 
requirements are the result of a recommendation from the Aviation 
Rulemaking Advisory Committee (ARAC). The ARAC stated that it is 
possible for a product or article to remain in production in excess of 
two years before it is released from production. Furthermore, that 
product or article would spend some length of time in service before 
any airworthiness directives (ADs) were possibly issued against it. 
Therefore, by the time a nonconformance or unairworthy condition is 
identified, the 2-year record retention period could have passed, 
making it difficult to identify a root cause for the condition. We have 
determined that a 5-year record retention for products and articles and 
a 10-year record retention for critical parts are necessary to 
facilitate the tracking of nonconformances. However, a PAH may maintain 
records longer if it chooses.
    Boeing suggested that we require record retention periods for 
products and articles only. We disagree. Records are objective evidence 
that a PAH has complied with all applicable regulatory requirements. 
Records are part of the quality system and are used to validate 
conformity to type design. Therefore, we have determined that these 
records are necessary, and the retention period is appropriate.
    We now require that the quality system include procedures for 
planning, conducting, and documenting internal audits to ensure 
compliance with the approved quality. A parts manufacturer

[[Page 53373]]

suggested the meaning of the term ``internal'' is relative to a PAH's 
quality system; therefore, audits of suppliers would fall within the 
scope of internal audits because a supplier is under the PAH's quality 
system. The commenter requested a clarification of the definition of 
``internal audits'' as it pertains to suppliers.
    The concept of what constitutes ``internal'' for the purposes of an 
audit is relative to the PAH's quality system. We think the regulation 
is sufficiently clear. Suppliers are controlled through the PAH's 
quality system, and procedures for suppliers' audits are dictated in 
Sec.  21.137(c), Supplier control. Conversely, Sec.  21.137(l) denotes 
procedures for the conduct of internal audits of the effectiveness of 
the PAH's Supplier Control System.
4. Replacement and Modification Articles
    Former Sec. Sec.  21.303(a) and (b) addressed production 
requirements for replacement and modification parts to ensure that only 
articles that conform to their approved design and are in condition for 
safe operation are installed in type-certificated aircraft. With 
certain exceptions, the former rule prohibited the production of such 
parts for sale for installation on a type-certificated product, unless 
those parts were produced pursuant to a PMA. Exempted from this 
requirement were parts produced under a TC or PC, parts produced by an 
owner or operator for maintaining or altering his own product, parts 
produced under an FAA TSO, and standard parts. This final rule 
consolidates those former requirements in newly established Sec.  
21.9(a), with some revisions. Under today's rule, the FAA will now 
prohibit the production of a replacement or modification article if the 
producer knows, or should know, that the part is reasonably likely to 
be installed on a type-certificated product unless the article part is:
     Produced under a TC;
     Produced under an FAA production approval;
     A standard part;
     A commercial part, as defined in Sec.  21.1;
     Produced by an owner or operator for maintaining or 
altering that owner or operator's product; or
     Fabricated by an appropriately rated certificate holder 
with a quality system and consumed in the repair or alteration of a 
product in accordance with part 43.
    The provisions of Sec.  21.9 apply to the producer of any part that 
may be used as a replacement or modification article, not just parts 
that were produced specifically as replacement or modification 
articles. In determining whether a violation has occurred, one factor 
the FAA will consider is whether the article was represented as 
suitable for installation on a type-certificated product. Producers of 
replacement or modification articles who represent those articles as 
suitable for installation on a type-certificated product may be in 
violation of Sec.  21.9 unless the articles were produced under one of 
the above exceptions.
    Representation may include, but is not limited to, a producer 
advertising its parts in aviation magazines; representing the part with 
statements such as ``aviation quality'' or ``as previously installed 
on''; issuing aviation parts catalogs; or marketing at aviation trade 
shows and conferences. Owners, operators, producers, and maintenance 
providers rely on these representations to determine the airworthiness 
of an aircraft, or the acceptability of products and articles for a 
given application. Therefore, these representations must be truthful. 
Assessing representation of a part is just one means of determining 
whether a violation of Sec.  21.9(a) has occurred. Absent any such 
representation, the FAA may still find a violation has occurred if 
evidence can be established that the producer knows or should know that 
the part is reasonably likely to be installed on a type-certificated 
product.
    Finally, newly established Sec.  21.9(c) would allow a person to 
represent an article as suitable for installation on a type-
certificated aircraft if the article was declared surplus by the U.S. 
Armed Forces and was intended for use on that model of U.S. Armed 
Forces aircraft.
    We received thirty-seven comments on this section. SBA's Office of 
Advocacy requested additional clarification on how the provisions of 
this section of the rule would apply. In addition, two individuals 
stated the rule language ``if a person knows, or should know, that the 
part is reasonably likely to be installed on a type-certificated 
product'' is very subjective, and it will be difficult to properly and 
consistently enforce. It believed distributors, owner/operators, and 
manufacturers could be subject to legal action due to misunderstandings 
of the rule. The expected misunderstandings would arise from the 
likelihood of this final rule affecting parts manufacturers not subject 
to FAA regulation before its issuance. However, we believe the new rule 
is clearly stated, objective, and enforceable. As we apply the 
standard, we will examine all relevant facts and circumstances to 
determine whether a person knew or should have known that a part he 
produced was reasonably likely to be installed on a type-certificated 
product.
    Numerous commenters (including Aircraft Electronics Association 
(AEA), Aviation Suppliers Association (ASA), and repair stations) 
stated our proposed rule no longer contained language prohibiting the 
production of parts ``for sale for installation on a type-certificated 
product.'' In addition, the SBA's Office of Advocacy asked the FAA to 
clarify and confirm that the existing ability of a repair shop to 
produce a part during maintenance activities remains in place. Since 
the NPRM proposed to remove that language, several repair stations 
asked us to clarify whether they will still be able to produce articles 
that will be consumed in the course of a repair without violating Sec.  
21.9(a).
    It is not our intent to preclude that activity. To address that 
concern and clarify our intent, we established an exception in Sec.  
21.9(a)(6). This exception, which was not proposed in the NPRM, allows 
for the production of articles without benefit of a production approval 
when articles are fabricated by an appropriately rated certificate 
holder with a quality system and consumed in the repair or alteration 
of a product or article in accordance with part 43. Maintenance 
providers who do not have a quality system may continue to fabricate 
owner-produced articles for installation on type-certificated aircraft 
using the guidelines set forth in Policy Memorandum, Definition of 
``Owner Produced Part,'' Section 21.303(b)(2), August 5, 1993.
    SBA's Office of Advocacy asked the FAA to clarify how the rule 
would impact the distribution of parts and existing inventories based 
on small business concerns that the proposed rules will forbid anyone 
from selling civil aircraft parts unless they are the manufacturer of 
the part, essentially forcing current parts distributors out of 
business. This phrase was used in former Sec.  21.303(a). We disagree. 
Section 21.9 governs the production, not the sale, of articles and does 
not prohibit distributors from selling articles.
    SBA's Office of Advocacy was also concerned that the regulation 
does not contain express provisions concerning inventories of existing 
articles. That commenter recommended we clarify that any new production 
requirements on articles or products apply only to articles 
manufactured after a certain date and that the requirements do not 
render current articles or products in inventory unusable. Like the 
Office of Advocacy, ASA believed the rule would

[[Page 53374]]

prohibit the sale of existing inventories, and thus, they would lose 
value. The commenters' concerns are unfounded. The requirements of this 
rule apply to products or articles as they are manufactured. The 
provisions of this rule do not apply to existing inventories.
    Lastly, an individual commenter stated modification articles should 
be exempted from a PMA if those articles could be installed: (1) As a 
minor alteration with a simple logbook entry without approved data, or 
(2) under a field approval with data approved by a Flight Standards 
District Office (FSDO) airworthiness inspector or Designated 
Engineering Representative (DER). We disagree. Both exceptions would 
serve to weaken our regulatory intent to ensure that only articles for 
which a suitability determination has been made are installed in type-
certificated aircraft. An article is not approved unless the article 
is: Produced under a TC; produced under an FAA production approval; a 
standard part; a commercial part, administered in a manner acceptable 
to the FAA; or produced by an owner or operator for maintaining or 
altering that owner or operator's product.
5. Definition of ``Commercial Parts''
    In the NPRM, we proposed to establish a definition of commercial 
parts and create a replacement parts classification that would 
facilitate the use of parts during maintenance. This rulemaking 
established that classification and allows for the production of 
commercial parts, as defined by this rulemaking, as replacement or 
modification articles without benefit of a production approval. Over 
ten commenters (including SBA's Office of Advocacy, the Regional 
Airline Association (RAA), ASA, and Snecma) stated the proposed 
definition of ``commercial parts'' was confusing. SBA's Office of 
Advocacy asked the FAA to further explain how the new provisions would 
impact current practices and the industry's ability to use parts that 
commonly have been referred to as commercial prior to this rulemaking. 
The commenters were concerned that only those parts designated by the 
DAH and approved by the FAA as commercial would be considered as such. 
They concluded the proposal would unduly restrict the use of commercial 
parts on in-service aircraft, which is common industry practice today.
    In response to these comments, we modified the definition of 
``commercial parts,'' as it was proposed in the NPRM, to better clarify 
the meaning of the term. A commercial part means an article that is 
listed on an FAA-approved Commercial Parts List included in the DAH's 
Instructions for Continued Airworthiness (ICAs). By creating a 
``commercial parts'' classification, the FAA has constructed a new 
mechanism by which commercial parts may be approved for use on type-
certificated products as replacement or modification articles. The FAA 
has not removed any of the processes used prior to this rule change for 
approving articles for installation on type-certificated products as 
replacement or modification articles. Those processes include 
purchasing the article from the PAH or manufacturer producing under a 
TC approved to produce the article; produced and installed under the 
provisions of an STC; or produced and installed in accordance with the 
provisions of part 43.
    For the purposes of this rulemaking, in order for a part to be 
considered commercial, the DAH must submit to the FAA a list of parts 
it has designated as commercial pursuant to the provisions of Sec.  
21.50(c). A part is designated as commercial when the DAH: (1) Provides 
data to the FAA showing that the failure of the commercial part, as 
installed in the product, would not degrade the level of safety of the 
product; (2) shows the part is produced only under the commercial part 
manufacturer's specification and marked with only the commercial part 
manufacturer's markings, and (3) provides any other data the FAA 
requires to approve the Commercial Parts List.
    As discussed in the NPRM preamble, the data requirement concerning 
the failure of the part is necessary to ensure that commercial parts, 
which are not subject to the rigorous quality control requirements for 
PAHs, cannot jeopardize flight safety if they fail. The part marking 
requirement is necessary to ensure that other similar parts, whose 
safety has not been demonstrated, cannot be substituted for the part 
identified as commercial. Because this is a new regulatory 
classification of parts, we cannot anticipate all the issues that may 
arise as applicants submit proposals. We therefore need the third 
``catch-all'' provision to obtain information necessary to verify our 
intent in creating this new classification is fulfilled and to ensure 
there is no adverse effect on safety. The DAH must include the 
Commercial Parts List in the Instructions for Continued Airworthiness. 
The FAA approves the commercial parts list, and the parts on it are 
then eligible for use on a type certificated product as replacement or 
modification articles.
    SBA's Office of Advocacy was equally concerned that as a result of 
this new commercial parts classification, non-PAH commercial parts 
manufacturers would be held liable for a violation of Sec.  21.9 
regarding production of parts if a part they manufacture is used on a 
type-certificated aircraft without being declared a commercial part. It 
stated the FAA should be aware that a strict reading of the proposed 
rule seems to suggest that once a manufacturer knows or has reason to 
know that a repair or maintenance facility is installing its product on 
an aircraft, that manufacturer would have a legal obligation to obtain 
the approval of either the design holder or the FAA (through a PMA or 
TSO) for that part. This would extend the reach of the FAA's rule to a 
vast universe of manufacturers, none of whom are included in the FAA's 
economic analysis.
    SBA's Office of Advocacy is correct in its understanding of the 
proposed rule, in that if non-PAH producers know or should know that 
their articles are reasonably likely to be installed on a type-
certificated product, they cannot produce those articles unless they 
meet one of the four exemptions noted in Sec.  21.9. Non-PAH parts 
producers that know their parts are being installed on type-
certificated products may apply for a production approval for the 
production of those parts, or the DAH of the product or article on 
which those commercial parts will be installed may designate them as 
commercial. Our intent is to create an enforceable standard that helps 
ensure that parts that are used on type-certificated products are 
produced under an approved quality system or otherwise approved for use 
on that product.
    Several repair stations were unclear on whether repair or 
maintenance facilities would still be able to utilize the maintenance 
provisions in Sec.  43.13 to install commercial parts on aircraft. 
Commercial parts as defined in this rulemaking do not require a 
production approval, and repair stations may continue to utilize the 
provisions of Sec.  43.13 to install parts. Those parts that are 
generally recognized by industry as commercial, but have not been 
designated on a Commercial Parts List, must be approved for 
installation in accordance with part 43.
    Two individuals stated that the use of commercial parts should be 
approved only in applications where their function or failure would not 
degrade safety. The FAA agrees with that statement, and as we do with 
other parts

[[Page 53375]]

approved as part of the type design, we will also evaluate commercial 
parts during the type design approval process to determine their affect 
on the safety of the product. In order for a DAH to designate a part as 
commercial, the DAH must show that failure of the commercial part would 
not degrade the safety of the product.
    Snecma and an individual commenter recommended that advisory 
material would be helpful in determining when or how commercial parts 
can be used as part of a type design, including guidance on what a DAH 
must do to obtain approval of its commercial parts. A repair station 
also commented that we should provide advisory material on when and how 
commercial parts may be used by operators and maintenance personnel. 
The FAA will issue advisory material providing guidance on the above 
concerns and on substitution of commercial parts during maintenance.
    Lastly, an individual commenter noted that the marking requirements 
for commercial parts are not consistent with the marking requirements 
in part 45. We agree. However, the marking requirements in part 45 
pertain only to those articles manufactured under an approved type 
design or in accordance with the provisions of a bilateral agreement 
between the United States and another country or jurisdiction for the 
acceptance of products and articles. Accordingly, the part 45 marking 
requirements are not applicable.
6. Location of or Change to Manufacturing Facilities
    The FAA is requiring all PAHs to obtain FAA approval before making 
any changes in location or physical changes to its manufacturing 
facilities. Additionally, PAHs must immediately notify us of any 
changes that may affect the inspection, conformity, or airworthiness of 
its products or articles. This requirement applies to all PAHs and 
persons producing under a TC only.
    One commenter noted that Sec.  21.122(a) appears to allow for 
production under a TC outside the United States. The commenter is 
correct. We considered amending subpart F to prohibit manufacturing 
under a TC in a foreign country. However, we decided to allow 
manufacturing under a TC in a foreign country, as long as it causes 
``no undue burden'' for the FAA.
7. Issuance of Export Airworthiness Approvals for Aircraft Engines, 
Propellers, and Articles
    Section 21.331 permits a person to obtain, from the FAA, an export 
airworthiness approval for a new or used aircraft engine, propeller, or 
article manufactured under this part if it conforms to its approved 
design and is in a condition for safe operation. Also, used aircraft, 
engines, and propellers are no longer required to be newly overhauled. 
Finally, prior to issuance of an export airworthiness approval for an 
aircraft engine, propeller, or article, the special requirements of 
importing countries or jurisdictions must be met.
    AIA, GE, and Pratt & Whitney suggested the FAA amend the rule to 
reflect that some products require disassembly for shipping purposes 
after the product has been certificated that it is ``in a condition for 
safe operation.'' Airworthiness is determined at the time the product 
is submitted to the FAA in an assembled state. We allow for disassembly 
of a product for the purpose of shipping to the end-user, but the 
importing authority will require an airworthiness determination after 
reassembly and prior to installation on the aircraft.
    AIA, Boeing, and GE also suggested we revise the rule language to 
allow a PAH to obtain letters of acceptance directly from the importing 
country when required for nonconforming products ready for export. A 
fundamental principle of our bilateral agreements is that letters of 
acceptance are transmitted between authorities, and we are not planning 
to institute a change to that policy. Because bilateral agreements 
supersede our regulatory requirements, the FAA will continue to receive 
and process letters of acceptance from importing authorities.
    AIA, Boeing, and GE further stated it would be beneficial for us to 
define the term ``used'' as it appears in Sec.  21.331. They also 
suggested that we revise Sec.  21.331 to allow the issuance of export 
airworthiness approvals for used products that do not meet an approved 
type design, as service time and wear prevent conformity to new article 
dimensions. We agree that there should be a consistent application of 
the term ``used'' as it relates to aircraft products; however, a 
regulatory definition would not be appropriate at this time because the 
term has different meanings in its application in a certification 
context versus a maintenance context. As to the comment regarding 
nonconforming products, Sec.  21.331 already allows for the issuance of 
an export airworthiness approval for used products that do not meet an 
approved type design.
    An individual commenter thought it unnecessary to obtain letters of 
acceptance from an importing country when shipping nonconforming 
products or articles. We disagree. An importing authority has complete 
discretion on whether it will accept nonconforming products or 
articles, and this issue is addressed between authorities in bilateral 
agreements and is not dictated via domestic regulations. Another 
individual commenter suggested that an importing country, rather than 
the FAA, should authorize deviations from the regulatory requirements 
of subpart L for products exported. Importing countries have no 
regulatory jurisdiction in the United States, and therefore, they have 
no authority to grant a deviation from our requirements. We maintain 
sole authority to grant deviations from our regulations.
    An individual commenter suggested that the rule accommodate the 
movement of articles whose airworthiness status is unknown. Again, we 
disagree. The rule is intended to accommodate only the export of 
products and articles determined to be airworthy. The issuance of an 
airworthiness approval for products and articles whose status is 
unknown would be contrary to the fundamental airworthiness principles 
and obligations of our bilateral airworthiness agreements with other 
countries and/or jurisdictions.
    Section 21.335(a) requires exporters to forward to the importing 
country or jurisdiction all documents specified by that country or 
jurisdiction. Paragraph (b) requires the exporter to preserve and 
package products and articles as necessary to protect them against 
corrosion and damage during transit or storage and to state the 
duration of effectiveness of such preservation and packaging. AIA, GE, 
aircraft parts manufacturers, and individuals assert that because it is 
difficult, or sometimes impossible, to predict how long an article may 
need to be preserved, it may be equally difficult to comply with the 
packaging and preservation requirements.
    This rule requires that products and articles be properly preserved 
and packaged as necessary at the time of export. Exporters must state 
the duration of effectiveness, but they are not required, as the 
commenters suggest, to exercise control over the end use or storage of 
the parts exported. If a product or article does not require any 
preservation or protective packaging in order to prevent damage, this 
rule does not apply.
    AIA and GE were concerned that U.S. exporters may be required to 
obtain an export airworthiness approval as part of the documents 
specified for export. They believed that import and export requirements 
should be the same. The commenters are correct. Based on the content of 
our agreement with a country, additional documentation,

[[Page 53376]]

including an export airworthiness approval from the importing country 
or jurisdiction, may be required.
    AIA mentioned that Sec.  21.335(a), or the preamble, should clearly 
state the documentation requirements for export, as there is often a 
variation in requirements. The FAA has numerous bilateral agreements 
with countries addressing the type, format, and content of 
documentation required for imported and exported products and articles. 
It would be impractical to delineate all those requirements in our 
regulations, as they are subject to change by the importing country. 
The FAA does request the importing authorities to periodically update 
and review its special import requirements, and we maintain that 
information in AC 21-2, Appendix 2, which is available on our Web site.
8. Definition of ``Standard Parts''
    We proposed in the NPRM to expand the definition of ``standard 
parts'' that appeared in former Sec.  21.303(b)(4). The proposed 
definition of ``standard parts'' included a part that conforms to a 
specification established by a foreign government agency or a consensus 
standards organization. However, due to conflicts between our proposed 
definition with other authorities' definitions of ``standard parts,'' 
the FAA has decided against revising the definition of ``standard 
parts'' at this time. Instead, we are maintaining the original use of 
the term, which now appears in Sec.  21.9(a)(3).
9. Definitions
    FAA has expanded the part 1 definition of ``approved,'' as it 
relates to the approval of products and articles, to include approvals 
issued under the provisions of a bilateral agreement between the United 
States and a foreign country or jurisdiction. This amendment clarifies 
that data approved by a foreign civil aviation authority under a 
bilateral agreement does not require further FAA approval. Furthermore, 
the term ``jurisdiction,'' as it appears in the definition, applies to 
entities that are not countries (e.g., the European Union (EU)).
    Section 21.1(a)(1) prescribes procedural requirements for issuing 
and changing design approvals, production approvals, airworthiness 
certificates, and airworthiness approvals. Paragraphs (b)(1) through 
(b)(8) define the terms airworthiness approval, article, commercial 
part, design approval, product, production approval, State of Design, 
and State of Manufacture.
    We received forty-eight comments on this section. National Civil 
Aviation Agency--Brazil (ANAC) asked that we define the term 
``airworthiness certificates.'' An airworthiness certificate is a form 
issued by the FAA or its designee to document whether a product meets 
its type design and is in a condition for safe operation. The usage of 
this form in this manner has been commonly accepted, and we have 
determined that the term ``airworthiness certificate'' is widely 
understood and requires no further definition.
    ANAC stated that the term ``jurisdiction,'' as it appeared in the 
proposed definition of ``State of Design,'' should be defined because 
an airworthiness jurisdiction is sometimes different than the company's 
legal location jurisdiction. We have revised the definition of ``State 
of Design'' to clarify that it means an entity that has regulatory 
authority over an organization responsible for the design and continued 
airworthiness of a civil aeronautical product or article. The concept 
of ``airworthiness jurisdiction'' is addressed by the reference to 
regulatory authority.
    ANAC further stated that we should better clarify the term ``State 
of Manufacture'' because a product or article could have more than one 
State of Manufacture. Accordingly, we have revised the definition of 
``State of Manufacture'' to clarify that it means the country or 
jurisdiction with regulatory authority over the organization 
responsible for the production and airworthiness of a civil 
aeronautical product or article.
    An individual commenter mentioned the definition of ``airworthiness 
approval'' should include a reference to FAA Forms 8130-3 and 8130-4. 
The commenter also stated that an FAA Form 8130-3 should be required 
for standard and commercial parts when sold to an owner/operator for 
installation. We disagree with both comments. The FAA reserves 
discretion to change or use different FAA forms for various functions. 
Therefore, we rarely use form numbers in the regulations. The required 
form and manner of regulatory compliance is usually stated in policy 
and guidance material. Also, as stated, an airworthiness approval is 
used to document the airworthiness status of products and articles. 
Because standard and commercial parts are not produced pursuant to an 
approved type design, it would be inappropriate to issue an 
airworthiness certificate for those parts. While the FAA does not issue 
airworthiness approvals for these parts, they have been subjected to 
evaluation by both the type design holder and the FAA to ensure their 
suitability of use in the design.
    Boeing and two individual commenters stated that the term 
``article'' should be used throughout Title 14. We have determined that 
the part 21 definition of ``article'' may be inappropriate for use in 
applications of the term in other parts of the regulations. Universal 
application of the definition could likely result in unintended 
consequences. However, the definition of ``article'' is appropriate for 
use in this part.
    GE and two individual commenters contended that the definition of 
``article'' should not include ``processes'' because generally, there 
are no processes that can be considered stand-alone articles. Prior to 
this rulemaking, we have traditionally defined ``article'' to include 
processes, particularly in reference to TSO parts. We are retaining 
that usage in this rule. We have determined that this definition is 
appropriate because there are, in fact, instances when a stand-alone 
process, such as software, is considered an article. When making a 
determination of whether a process is an article, the FAA must consider 
whether that process is a deliverable, stand-alone end item.
    AIA, Boeing, and GE stated that we should define the term 
``supplier''. In general, the term ``supplier'' is understood to mean 
any person or organization contracted to furnish products, articles, or 
related services at any tier. However, the term ``supplier'' is well-
understood, and there is no need to define the term in this rulemaking 
action.
    We have removed from subpart L the definitions of Class I, Class 
II, and Class III products and the definition of ``newly overhauled''. 
We now use the terms product and article consistently throughout part 
21. In addition, we no longer require a definition of ``newly 
overhauled'' since all occurrences of the term and any associated 
requirements related to it have been removed from the regulations.

B. Miscellaneous Requirements

    The following discussion addresses miscellaneous amendments made to 
part 21, many of which are primarily procedural or administrative in 
nature and do not constitute major departures from the pre-existing 
part 21 rules. In addition, we have made administrative changes to the 
regulatory text to use terms consistently and for plain language 
purposes.
1. Application for Parts Manufacturer Approval
    Section 21.303 requires an article to conform to its ``approved 
design,'' rather than conforming to ``drawings in the

[[Page 53377]]

design,'' as was required by its predecessor rule. We have replaced the 
term ``fabrication processes,'' appearing in the former rule, with 
``manufacturing processes'' to reflect that PMA holders will no longer 
have a fabrication inspection system. PMA holders must now comply with 
the same quality system requirements as all other PAHs, consistent with 
the size of the PAH and the complexity of the product or article 
produced. PMA applicants must also provide a statement certifying that 
the applicant has complied with the airworthiness requirements of this 
subchapter.
    We received eleven comments on this section. AIA and GE recommended 
that we clarify in the rule the meaning of ``approved design''. The 
commenters noted that design data, such as process specifications, are 
more than likely referenced on a drawing and may, along with the 
drawing, comprise the complete type design data package. Specifications 
and design documents may include material properties, inspection 
criteria, non-destructive inspection criteria, design practices, design 
parameters, or documents that include operational limits.
    We do not agree that a detailed definition of ``approved design'' 
is appropriate in this regulation. In our experience, it is widely 
understood among applicants and approval holders that an ``approved 
design'' means a complete design data package containing substantiating 
data (e.g., processes, material specification, design parameters, and 
limitations). Our intent is to clarify that the approved design may 
consist of more than referenced drawings.
2. Production under Type Certificate (TC)
    This rule revises the introductory text of Sec.  21.123 to clarify 
that a TC holder is authorized to manufacture articles, not just 
products, for its type-certificated products. Paragraph (b) requires 
the TC holder to make each product and article available to the FAA for 
inspection. Paragraph (c) requires each manufacturer of a product, or 
article thereof, under a TC to maintain completed inspection and test 
records for specified periods of time. This rule also increases the 
record retention requirements for all PAHs and for persons producing 
under a TC from 2 years to at least 5 years. For critical components 
identified under Sec.  45.15(c) of this chapter, the record retention 
requirement is at least 10 years. Paragraph (d) requires each 
manufacturer of a product, or article thereof, manufactured under a TC 
to allow the FAA to make any inspection or test (including any 
inspection or test at a supplier facility) necessary to determine 
compliance with this subchapter.
    Industry groups, aircraft, aircraft engine, and parts manufacturers 
expressed four main concerns. AIA, GE, and Pratt & Whitney were 
concerned with the applicability of this section to existing TC or PC 
holders. The commenters suggested that subpart F should only apply to 
first-time applicants. If a person holds a current TC and PC for 
various product models, then that person is producing articles for any 
new models under an existing quality system. Commenters assert that the 
TC or PC holder should not be required to obtain a PC six months after 
the issuance of the new model TC, as required by Sec.  21.123, because 
the person already has a PC. We partially agree. If the PC holder 
chooses to manufacture a more complex product, the FAA must review the 
quality system to determine whether it is adequate to produce products 
or articles that conform to the type design and is in a condition for 
safe operation.
    A part manufacturer asked whether a TSO article that is 
incorporated into a TC is considered to have been manufactured in 
accordance with the type design for the TC. While the TSO article is 
part of the type design, it has its own approval process. A TSO article 
is produced using minimum performance specifications; those 
specifications constitute the design for the TSO article. That design 
data is submitted to the FAA for approval with the manufacturer's 
quality manual. A joint design/production approval is then granted 
under subpart O.
3. Falsification of Applications, Reports, or Records
    Section 21.2 prohibits persons from making misleading statements on 
applications for certificates or approvals or in any record or report 
that is kept, made, or used to show compliance with any requirement of 
this part. For the purposes of this rule, a misleading statement 
requires a material representation or omission that is likely to 
mislead a person when that person is acting with reasonable diligence 
under the circumstances. The scope of Sec.  21.2 is now expanded to 
prohibit fraudulent, intentionally false, or misleading statements on 
any record that is kept, made, or used to show compliance with any 
requirement of part 21. Also, a violation of this rule may be used as 
the basis for denying an approval issued under part 21, in addition to 
suspending or revoking an approval.
    We received eight comments on this proposed rule. AIA, Boeing, GE, 
Pratt & Whitney, Embraer, and an individual commenter were concerned 
that some persons might unknowingly make misleading statements and be 
subject to an FAA violation. They stated that we should recognize, and 
the rule should reflect, that honest mistakes happen and that those 
mistakes should be given due consideration.
    The FAA recognizes that honest mistakes happen, and to that end, we 
will collect and evaluate any available evidence regarding incorrect 
representations and examine the overall impression created by that 
representation. We must reserve the right to take action, as 
appropriate, to address material inaccuracies in the related 
application or records, whether or not the inaccuracies are 
intentional.
    Experimental Aircraft Association (EAA) requested that we revise 
the preamble language to reflect that phrases such as ``direct 
replacement'' and ``ready to use in your aircraft'' are acceptable, as 
they have been used for years in both certificated and experimental 
aircraft industries. However, the FAA will not endorse the use of the 
phrases ``direct replacement'' and ``ready to use in your aircraft'' to 
suggest that an article is approved for installation on a type-
certificated aircraft unless the statements are supported by objective 
evidence of such an approval.
    An individual commenter stated that we should clarify that Sec.  
21.2 applies to noncertificated persons, commercial parts producers, 
standard parts producers, and surplus suppliers. Part 21 governs the 
certification of products or articles, and persons seeking such 
certification would be subject to its provisions.
4. Design Changes
    Section 21.319 governs the classification and approval of PMA 
design changes. Prior to this rulemaking, part 21 did not formally 
address PMA design changes. Changes were accomplished using the design 
change process used for TCs.
    Seven commenters, representing industry groups, aircraft 
manufacturers, and engine manufacturers, expressed two main concerns. 
The first concern was with the proposed definition of ``minor change''. 
In general, AIA, Boeing, and GE believe that limiting the applicability 
of design changes to an isolated view of ``parts-only'' could impact 
safety. For example, under Sec.  21.319(a)(1), a change to the design 
of an article may be classified as minor; however, if the change was 
evaluated

[[Page 53378]]

with consideration of the complete aircraft or engine, the 
classification of the change might not be minor.
    We disagree with the commenters and have determined that safety 
will not be adversely affected by classifying changes to PMA parts as 
``minor''. The classification of a change to a PMA article as minor 
under Sec.  21.319 does not waive the installer of the requirements of 
compliance to part 21, subpart D for the TC holder. This is due to the 
installation of the changed PMA article, or the requirements of Sec.  
21.113 for any person altering a type product with a major change in 
type design. For example, if the installation of the changed PMA 
article causes a major change to the type product, Sec.  21.113 
requires an STC for installation approval.
    To clarify that the PMA change classification is only to apply at 
the article level, we modified the definition of minor change. Section 
21.319(a)(1) has been changed to read, ``A `minor change' to the design 
of an article produced under a PMA is one that has no appreciable 
effect on the approval basis.''
    Boeing recommended that we review the EASA regulation and 
associated guidance and provide a discussion in the rule language to 
differentiate how design changes are approved under differing methods 
of obtaining a PMA. The issue of design change classifications 
encompasses individuals other than just PMA holders who obtained their 
approvals with licensing agreement data. TC holders can license their 
design data to any third person, including to PAHs who have no 
intention of seeking a PMA. The PMA holder can only evaluate the change 
to its own design approval for its own article. If the PMA holder is 
making a design change that affects the product on which the article is 
installed, it requires an STC for the product.
    Furthermore, a comparison of our proposed regulation regarding 
design changes with EASA regulations and guidance is beyond the scope 
of this rulemaking.
5. Changes in Quality System
    Section 21.150 specifies requirements regarding changes in the 
quality system. Previously, we required the PC holder to notify the FAA 
of any change that might affect the inspection, conformity, or 
airworthiness of the product. This rule amends that requirement to now 
apply to ``articles,'' as well as products. Accordingly, we have 
incorporated this requirement in subparts K and O, which are applicable 
to PMA holders and TSO authorizations, respectively. Again, this rule 
standardizes requirements for all PAHs.
6. Transferability of a Type Certificate
    Today's rule requires a TC holder to notify the FAA before the 
transfer, execution, or termination of a licensing agreement. Such 
notification allows us time to coordinate with our affected offices and 
to inform the prospective licensees of their responsibilities. We also 
now require a grantor to notify the FAA of TC transfer when the State 
of Design is changing before the transfer occurs. Transferring a TC 
when the State of Design is changing requires FAA coordination with the 
aviation authority of the prospective State of Design to identify 
requirements in support of the transfer and to reduce the FAA's burden 
in managing the certificate.
    Embraer suggested the FAA place limits on how much advance notice 
is required before transferring a certificate. We have determined that 
it is more efficient to coordinate the transfer of a TC before the 
transfer, rather than after it has occurred. Depending on the scope of 
the transferred TC (complex aircraft or engine, etc.), the length of 
transfer time may vary. Therefore, predetermined time limits could 
restrict the process.
    ANAC suggested we require an agreement between States for licensing 
agreements in which the licensee or the licensor is in another country. 
ANAC believes such an agreement would make the oversight process more 
efficient. We agree. However, bilateral agreements between authorities 
already address licensing agreements between States, and we need not 
make this a regulatory requirement. We exercise oversight 
responsibilities for licensors in the United States. We have no 
oversight responsibility over licensees located in other States.
    An individual commenter stated that the rule language regarding the 
anticipated date of the agreement in Sec.  21.47(d) requires further 
explanation. That commenter also questioned whether the licensing 
agreement should be sent to the Manufacturing Inspection District 
Office (MIDO), rather than the Aircraft Certification Office (ACO), as 
any manufacturing activity based on the licensing agreement must be 
approved by the MIDO. The ``anticipated date of the transfer'' is a 
projection and may be speculative at times on the part of the licensor. 
Furthermore, Sec.  21.47(d) applies to TC holders. A production 
approval applicant must work with both the ACO and its cognizant MIDO.
7. Special Flight Permits
    Section 21.197(c)(1) allows the issuance of special flight permits 
by part 119 certificate holders that have an approved program for 
continuing flight authorization. It also allows the issuance of special 
flight permits by management specification holders authorized to 
conduct operations under part 91 for aircraft they operate and maintain 
under a continuous maintenance program prescribed by Sec.  91.1411.
    The flight permits include conditions and limitations for flight 
and may be issued for aircraft that do not meet applicable 
airworthiness standards. Formerly, the FAA allowed the issuance of 
special flight permits only by operators that maintain their aircraft 
under a continuous airworthiness maintenance program (CAMP). This rule 
provides relief to operators who do not have a CAMP but periodically 
require the issuance of special flight permits. The operator must have 
the necessary quality system and infrastructure to support this 
authorization.
8. TC Applicant--Compliance with Applicable Requirements
    We established Sec.  21.20(a) to require an applicant for a TC, 
including an amended TC or STC, to show compliance with all applicable 
requirements and to provide the FAA the means by which such compliance 
has been shown. It also requires an applicant for a TC, including an 
amended TC or STC, to provide a statement certifying that the applicant 
has complied with the applicable requirements.
    We received four comments on this section. Embraer, a repair 
station, and two individual commenters stated that it would be 
difficult for an applicant to determine if all of the requirements had 
been met prior to applying for a TC. Therefore, further guidance might 
be required. The type certification process requires the applicant and 
the ACO to work closely together through the entire certification 
process. The ACO will advise applicants of the requirements prior to 
receipt of the certifying statement. This rule is intended to expedite 
the type certification approval process by ensuring that an applicant's 
submission package is complete prior to the FAA making the compliance 
determination.
9. Issuance of Standard Airworthiness Certificates
    We revised Sec.  21.183(c) to allow a person to obtain a standard 
airworthiness certificate for an aircraft

[[Page 53379]]

that is imported to the U.S. via an export certificate of 
airworthiness, provided the aircraft is type certificated under Sec.  
21.21 or Sec.  21.29, manufactured under the authority of another State 
of Manufacture, and there is no undue burden on the FAA. The State of 
Manufacture must certify (in accordance with the provisions of an 
agreement with the United States for import and export of that 
aircraft), and the FAA would have to determine that the aircraft 
conforms to its type design and is in a condition for safe operation.
    An individual commenter stated that Sec.  21.183(c) should be 
revised to apply the standards to new aircraft only. However, it would 
be inappropriate to apply the rule for new aircraft only because there 
are instances when used aircraft may be eligible for a standard 
airworthiness certificate, such as when a used aircraft is imported 
into the United States. If an airworthiness determination can also be 
made for these aircraft, we have determined that used aircraft should 
be eligible for a standard airworthiness certificate.
    That commenter also asserted the 100-hour inspection requirements 
of Sec.  21.183(d)(2) should not be relaxed. The commenter believed the 
only exception should be when: (1) An aircraft is imported from a 
country with which the United States has a bilateral agreement that 
addresses maintenance, and (2) the aircraft is currently certificated 
and operating under an acceptable inspection/maintenance program. 
Section 21.183(d)(2) does not relax the 100-hour inspection 
requirement. Section 21.183(d)(2) merely provides an alternative means 
of determining whether a product is acceptable.
    The commenter further asserted that the U.S. should only accept a 
used aircraft from a country or jurisdiction that is not the State of 
Manufacture when we have a bilateral agreement for maintenance with 
that country or jurisdiction. Finally, the commenter stated that the 
U.S. should not accept an aircraft for an airworthiness certification 
in a category that requires a TC, unless the State of Manufacture for 
that aircraft provides a certification of its status at manufacture.
    The intent of Sec.  21.183(d)(2) is to provide the ability to 
accept equivalent inspection standards and the corresponding 
airworthiness determinations from those countries and jurisdictions 
with which the U.S. has a bilateral agreement. This rule incorporates 
current policy, is consistent with bilateral practices, and may reduce 
the cost of importing a used aircraft when duplicate inspection 
requirements are eliminated.
10. Approval of Major Changes in Type Design
    The FAA now requires an applicant for approval of a major change in 
type design to show that the changed product complies with the 
applicable requirements. The applicant must provide the FAA the means 
by which such compliance has been shown and a statement certifying that 
the applicant has complied with the applicable requirements.
11. Quality Manual
    Section 21.138 requires each PC applicant to provide a quality 
manual describing its quality system to the FAA for approval. This 
requirement also applies to PMA and TSO approval holders. The quality 
manual must address the quality system requirements of the subpart 
under which the applicant seeks production approval. The quality manual 
should also address changes to the quality system, revisions to the 
manual, and a means of tracking revisions to the manual. These changes 
must be acceptable to the FAA. In addition, this rule requires that the 
quality manual be in the English language and retrievable in a form 
acceptable to us so that regardless of the media used, the quality 
manual is easily available to the PAH and FAA personnel.
12. Production Limitation Record
    Section 21.142 clarifies that the PC holder, not a PC applicant, is 
authorized to manufacture the products listed on the production 
limitation record (PLR). A PLR is issued once an applicant obtains a 
PC, allowing the PC holder to manufacture the products listed on the 
PLR.
13. Persons Authorized to Perform Maintenance, Preventive Maintenance, 
Rebuilding, and Alterations
    The FAA has amended Sec.  43.3(j)(3) by removing all references to 
an aircraft production inspection system (APIS). This change is 
consistent with the amendments to part 21, subpart F. This change also 
allows a manufacturer to perform any inspection required by parts 91 or 
125 on aircraft it manufactured under a TC only or currently 
manufactures under a PC.
    Transport Canada stated that Sec.  43.3(j) should be revised to 
eliminate the special maintenance privileges afforded to manufacturers 
so that all persons or organizations are subject to the same 
requirements.
    We recognize that this section needs clarification to address the 
performance of maintenance and oversight of those manufacturers who 
exercise the privileges of Sec.  43.3(j). FAA is currently working to 
address this and other maintenance/manufacturing issues.
14. Statement of Conformity
    The proposed rule requires a TC applicant to provide a statement of 
conformity for each aircraft engine or propeller presented for TC. This 
rule also removes the flight and operational check requirements that 
were previously in Sec.  21.130. Those requirements were redundant with 
the requirements in Sec. Sec.  21.127(a), 21.128, and 21.129. We have 
removed from the regulations prescriptive details related to particular 
FAA forms, form content, and form. This information is more 
appropriately located in policy documents that are more easily amended 
to reflect future changes in procedures.
    Previously, Sec.  21.130(c) exempted TC holders from providing a 
statement of conformity for products manufactured for the Armed Forces 
if they had accepted the product. We have removed that exception. Now, 
TC holders must issue an FAA Form 8130-2, Conformity Certificate--
Military Aircraft, for products manufactured for the Armed Forces. This 
amendment facilitates a future applicant's ability to obtain a special 
airworthiness certificate under Sec.  21.183(d) for surplus military 
aircraft.
    A parts manufacturer questioned the additional benefit associated 
with obtaining an FAA Form 8130-2, in addition to Form 8130-3, that 
would have been required under our original proposal. Because we are no 
longer mandating the issuance of an airworthiness approval, the 
commenter's concern about issuance of a Form 8130-3 approval is no 
longer at issue. However, a Form 8130-2 is still required for military 
aircraft used in civil applications. The FAA (or the DAR) relies on the 
statement of conformity issued by the manufacturer as objective 
evidence that the product or article for which the TC was issued 
conforms to its approved type design and is in a condition for safe 
operation.
15. Privileges
    We have revised Sec.  21.119(c) to clarify that the STC holder may 
obtain a PC for the change in the type design approved by the STC if 
the STC holder meets the requirements of subpart G, pertaining to the 
issuance of PCs.

[[Page 53380]]

16. Issuance of Airworthiness Certificates for Restricted Category 
Aircraft
    We have revised Sec.  21.185(c) to allow, under certain conditions, 
the issuance of a special airworthiness certificate for restricted 
category aircraft that are imported into the U.S. with an export 
certificate of airworthiness. That aircraft must be type certificated 
under Sec. Sec.  21.25 or 21.29 and be manufactured under the authority 
of another State of Manufacture. The State of Manufacture must certify 
that the aircraft conforms to its type design and is in condition for 
safe operation at the time of export. Again, the FAA must find that the 
aircraft conforms to its type design and is in condition for safe 
operation.
17. Acceptance of Articles
    We have revised Sec.  21.502 by replacing the word ``approval'' 
with ``acceptance'' to clarify that subpart N governs only the import 
or acceptance of articles into the U.S.; not the original design or 
production approvals of articles. This revision also requires that an 
article (including an article produced under a letter of TSO design 
approval) be marked in accordance with part 45 of this chapter to meet 
the requirements for FAA acceptance.

C. Compliance Dates

    This rule is effective 180 days after publication in the Federal 
Register. The compliance date for part 1; part 21, subparts H, I, L, 
and N; and part 45, subpart B, Sec. Sec.  45.11 and 45.13 is 180 days 
after publication in the Federal Register. The rule changes in these 
subparts are either cost relieving or have no economic impact on 
industry. The changes do not affect, and are not affected by, other 
changes to the rule. Therefore, the compliance date is the same as the 
effective date. All other portions of the final rule either promulgate 
new requirements or are tied to other requirements that have an 
extended compliance date. These rule provisions have a compliance date 
of 18 months after the rule's publication in the Federal Register.
    Prior to the effective compliance dates of this final rule, 
compliance with any portion of this rule that conflicts with an 
existing rule is not allowed. However, it is possible to comply with 
the former part 21 requirements and the requirements of this rule 
concurrently.

III. Regulatory Notices and Analyses

Paperwork Reduction Act

    This rule contains new information collection requirements. As 
required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), 
the FAA submitted the information requirements associated with this 
rule to the Office of Management and Budget (OMB) for review and 
approval. An agency may not collect or sponsor the collection of 
information, nor impose an information collection requirement, unless 
it displays a currently valid OMB control number.
    As required by the Act, we submitted a copy of the new information 
requirements to OMB for its review when we published the NPRM. 
Additionally, in the NPRM, we solicited comments from the public on the 
proposed new information collection requirements. Affected parties, 
however, do not have to comply with the information collection 
requirements of this rule until OMB approves the FAA's request for this 
information collection requirement. The FAA will publish a separate 
document notifying you of the OMB Control Number and the compliance 
date(s) for the information collection requirements of this rule.
    The NPRM (71 FR 58914, October 5, 2006) summarized the FAA's 
analysis of the economic impacts of this rule. The FAA expected private 
entities would incur reporting and recordkeeping costs when applying 
for and operating under this rule and solicited comments on minimizing 
the cost and burden of the collection.
    Based on comments to the docket that costs were prohibitive and 
benefits small, the FAA withdrew proposals that required airworthiness 
approvals for all (domestic and overseas) shipments of aircraft 
engines, propellers, and articles; certifying staff to issue the 
approvals; and marking requirements for all aircraft products and 
articles. These changes removed $327.1 million or 99.2 percent of the 
original undiscounted (gross) cost, and $187.6 million or 99.1 percent 
of the original present value total cost.
    We also removed the provision in Sec.  21.331 to allow PAHs to 
issue their own export airworthiness approvals. The issuance of an 
export airworthiness approval by the manufacturer would violate the 
terms of our bilateral agreements with other countries and 
jurisdictions. A fundamental premise of all bilaterals is that exported 
parts must be accompanied by an airworthiness approval issued by the 
relevant authority or its authorized designee. We estimated 
undiscounted cost savings of $95.5 million over 10 years, and present 
value cost savings of $54.8 million from this rule change in the NPRM. 
The net cost relief from changes to the NPRM to the rule amount to 
$231.6 million in undiscounted costs and $132.8 million in present 
value costs.
    The average total annual cost burden and average total annual hour 
burden discussed in the NPRM do not take into consideration that 
section 3, Quality System manual and section 4, Organization, have 
costs that are front-loaded at a ratio of 80 percent in the first two 
years. Adjustments have been made to account for that front-loading.
Estimates of the Hour Burden of the Collection Information
    The requirements for hour burden of the information collection 
associated with this rule fall into the following categories:
     Reporting of Failures, Malfunctions, and Defects;
     Commercial Parts;
     PC Quality System (internal audits);
     PC Quality System (in-service feedback);
     PMA Application (statement of compliance);
     PMA Quality System;
     PMA Quality Manual;
     TSO Organization.
    The total annual hour burden for this rule is estimated to be 
approximately 2,589 hours.
Benefits of this Rulemaking
     The rule becomes effective in 2009. However, the FAA does 
not propose to make this information collection effective until 
approximately 12 months after the rule's effective date.
     The costs savings a private entity will attain under this 
rule will exceed the costs imposed by this rule.

International Compatibility

    In keeping with U.S. obligations under the Convention on 
International Civil Aviation, it is FAA policy to comply with 
International Civil Aviation Organization (ICAO) Standards and 
Recommended Practices to the maximum extent practicable. The FAA has 
reviewed the corresponding ICAO Standards and Recommended Practices and 
has enhanced two ICAO definitions in these regulations.

Regulatory Evaluation, Regulatory Flexibility Determination, 
International Trade Impact Assessment, and Unfunded Mandates Assessment

    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Order 12866 directs that each Federal agency 
shall propose or adopt a regulation only upon a reasoned determination 
that the benefits of the intended regulation justify its costs. Second, 
the Regulatory Flexibility Act of 1980 (Pub. L. 96-354) requires 
agencies to analyze the economic impact of regulatory changes on small

[[Page 53381]]

entities. Third, the Trade Agreements Act (Pub. L. 96-39) prohibits 
agencies from setting standards that create unnecessary obstacles to 
the foreign commerce of the United States. In developing U.S. 
standards, this Trade Act requires agencies to consider international 
standards and, where appropriate, that they be the basis of U.S. 
standards. Fourth, the Unfunded Mandates Reform Act of 1995 (Pub. L. 
104-4) requires agencies to prepare a written assessment of the costs, 
benefits, and other effects of proposed or final rules that include a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more annually (adjusted for inflation with base year of 
1995).
    In conducting these analyses, the FAA has determined this final 
rule has benefits that justify its costs, and it is a ``significant 
regulatory action'' as defined in section 3(f) of Executive Order 12866 
because it raises novel policy issues contemplated under that executive 
order. Accordingly, OMB has reviewed this rule. The rule is also 
``significant'' as defined in DOT's Regulatory Policies and Procedures. 
The final rule, if adopted, will not have a significant economic impact 
on a substantial number of small entities, will not create unnecessary 
obstacles to international trade and will not impose an unfunded 
mandate on state, local, or tribal governments, or on the private 
sector. These analyses, available in the final regulatory evaluation 
supporting this rule, are summarized below.

Regulatory Evaluation Summary

    For more information, we suggest readers go to the full regulatory 
evaluation. A copy is in the docket for this rulemaking.
    This portion of the preamble summarizes the FAA's analysis of the 
economic impact of this rule. It also includes summaries of the final 
regulatory flexibility analysis, international trade impact assessment, 
and the unfunded mandate assessment. For more information, we suggest 
readers go to the full regulatory evaluation, a copy of which we have 
placed in the docket for this rulemaking.
Total Benefits and Costs of this Rule
    We find the modest costs of this rule to be overwhelmed by very 
large cost savings and some safety benefits. We estimate the 
undiscounted 10-year costs of this rule to be about $2.1 million, the 
undiscounted 10-year cost savings to be about $126 million, and the 
undiscounted 10-year safety benefits to be about $10.1 million. We 
estimate the present value (2009 dollars) costs of this rule to be 
about $1.7 million, the present value cost savings to be about $88.4 
million, and the present value safety benefits to be about $7.1 
million. Consequently, we estimate this rule to be highly cost-
beneficial with undiscounted 10-year net benefits of about $134 million 
and present value net benefits of about $93.8 million.
Persons Potentially Affected by this Rule
    This rule primarily directly affects all type certificate (TC) and 
production approval holders (PAHs), including holders of PCs, TSOs, and 
PMAs. Regional air cargo carriers and exporters of used aircraft and 
used engines, propellers, and other articles (primarily distributors 
and individuals) are also directly affected by this rule.
Assumptions and Sources of Information
     As the rule mandates procedural changes with small front-
loaded costs, we use a 10-year period of analysis, 2009 through 2018.
     This rule will become a final rule in 2009. The FAA 
intends to make cost-neutral or cost-relieving subparts and sections of 
this rule that are stand-alone changes effective 180 days after 
publication in the Federal Register. For purposes of our cost-benefit 
analysis, we assume safety benefits and benefits of cost-relieving 
changes will begin in 2009. The remaining portions of the rule (with 
positive costs) will be effective 12 months after the rule's effective 
date. We assume one-time costs will occur in 2010 and continuing costs 
will begin in 2010.
     The discount rate is 7 percent (Office of Management & 
Budget, Circular A-94, ``Guidelines and Discount Rates for Benefit-Cost 
Analysis of Federal Programs'', October 29, 1992, p. 8).
     We obtained the number of PAHs by PAH type from the FAA's 
Certificate Management Information System (CMIS) database.
     PAHs are defined as ``small'' or ``large'' using U.S. 
Small Business Administration (SBA) size standards. (See table of Small 
Business Size Standards Matched to North American Industry 
Classification System Codes, July 21, 2006.)
     We estimated the number of small (and large) PAHs using a 
45 percent sample of all PAH data from the FAA's Small Airplane and 
Rotorcraft Directorates.
     The fully burdened wage rate for engineers and quality 
system professionals is $80 an hour.
     The fully burdened wage rate for pilots in the regional 
air cargo industry is $55 an our (RACCA).
     We obtained data on aircraft and aircraft engine exports 
from the Trade Policy Information System (TPIS) database (International 
Trade Administration, Department of Commerce).
     Importing countries accept large transport category 
airplanes based on a bridge inspection document (Industry expert from 
the Aeronautical Repair Station Association (ARSA)).
     Exporters of used aircraft and used engines compete away 
90 percent of the cost savings to overseas buyers.
     Forty percent of U.S. engine exports are used engines 
(based on the percentage of used aircraft exports shown by TPIS 
database).
     Aircraft engine overhauls occur every five years (FAA 
expert from the Office of Aviation Safety, Flight Standards Service 
(AFS)).
     Eighty percent of importing countries accept used large 
jet engines without a complete overhaul (ARSA industry expert).
     We obtained information on aircraft accidents caused by 
inadequate quality control from the National Transportation Safety 
Board (NTSB) accident reports and the FAA's Aviation Safety Information 
Analysis and Sharing (ASIAS) database for air claims.
     The value of a statistical fatality averted is $3 million 
(Economic Values for FAA Investment and Regulator Decisions, a Guide, 
p. 2-2, Aviation Specialist Group, Inc., for Office of Aviation Policy 
and Plans, FAA, Washington, DC, December 31, 2004).\1\
---------------------------------------------------------------------------

    \1\ The current value of the equivalent life saved is $5.8 
million, and under that value, benefits would be even higher.
---------------------------------------------------------------------------

     The legal and medical costs for fatalities and injuries 
are obtained from Economic Values for FAA Investment and Regulator 
Decisions, pp. 2-2 to 2-4.
     This rule will prevent 50 percent of future accidents 
caused by inadequate quality control.
     Data on costs of compliance with this rule were obtained 
from FAA data and industry representatives.
Changes From the NPRM to the Final Rule
    Based on comments to the docket that costs were prohibitive and 
benefits small, the FAA has withdrawn major proposals requiring 
airworthiness approvals for all (domestic and overseas) shipments of 
aircraft engines, propellers, and articles; certifying staff to issue 
these approvals; and marking

[[Page 53382]]

requirements for all aircraft products and articles. These changes 
remove $327.1 million or 99.2 percent of the original undiscounted 
(gross) cost, and $187.6 million or 99.1 percent of the original 
present value total cost.
    We have also, however, removed the provision in Sec.  21.331 that 
would have allowed PAHs to issue their own export airworthiness 
approvals. The issuance of an export airworthiness approval by the 
manufacturer would violate the terms of our bilateral agreements with 
other countries and jurisdictions. A fundamental premise of all 
bilaterals is that exported parts must be accompanied by an 
airworthiness approval issued by the relevant authority or its 
authorized designee. In the NPRM, we estimated undiscounted cost 
savings of $95.5 million and present value cost savings of $54.8 
million from this rule change. Consequently, the net cost relief from 
changes to the NPRM amount to $231.6 million in undiscounted costs and 
$132.8 million in present value costs.
Benefits of this Rulemaking
    The benefits of the rule include estimated cost savings from three 
rule changes that relieve regulatory burden and estimated safety 
benefits. As the table shows, we estimate the undiscounted 10-year cost 
savings from these rule changes to be about $126.0 million and the 
present value cost savings to be about $88.4 million. Safety benefits 
from this rule will arise to the extent that it prevents accidents 
caused by inadequate quality control. As the table shows, we estimate 
the undiscounted 10-year safety benefits of this to be about $10.1 
million and the present value (2009 dollars) safety benefits to be 
about $7.1 million. As the table shows, summing the cost savings and 
the safety benefits yields undiscounted total 10-year benefits of about 
$95.5 million and total present value (2009$) benefits of about $95.5 
million.

                               Table 1--Summary Table of Benefits by Rule Section
----------------------------------------------------------------------------------------------------------------
                                                                          Present value cost   Undiscounted cost
              Section No.                      Section description         savings/benefits    savings/benefits
----------------------------------------------------------------------------------------------------------------
Sec.   21.197..........................  Special flight permits.........          $4,596,668          $6,661,500
Sec.   21.329(c) deleted...............  Annual type inspection no                 6,719,695           9,567,330
                                          longer required for used A/C
                                          to receive export
                                          airworthiness certificate.
Sec.   21.331 (Sec.   21.329(e)          New overhaul no longer required          77,122,043         109,804,440
 deleted).                                for used engine to receive
                                          export airworthiness approval.
                                                                         ---------------------------------------
                                         Total Cost Savings.............          88,438,406         126,033,270
                                        ------------------------------------------------------------------------
                                         Safety Benefits................           7,067,034          10,061,867
                                        ------------------------------------------------------------------------
                                         Total Benefits of the Rule.....          95,505,440         136,095,137
                                        ------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------

Costs of This Rulemaking
    The Final Regulatory Evaluation for this rule examines the impact 
of an FAA final rule that will make extensive changes to its part 21 
certification procedures and identification requirements for 
aeronautical products and articles. These changes will:
     Standardize several requirements for PAHs, including 
requirements for a quality system and quality manual to reflect 
industry best practices;
     Revise export airworthiness approval requirements to 
facilitate global manufacturing and trade;
     Move all part marking requirements from part 21, 
Certification Procedures for Products and Parts, to part 45, 
Identification and Registration Marking; and
     Add a new classification of parts called ``commercial 
parts.''
    The intent of these changes is to promote safety by ensuring that, 
whether manufactured locally or abroad, aircraft products and articles 
meet applicable standards. These changes will update the regulations to 
reflect the current global environment for the manufacture and trade of 
aircraft products and articles and, more generally, to improve 
regulatory efficiency.
    Most of these changes standardize, clarify, or simplify rule 
language, while other rule changes are already industry practice. 
Consequently, they impose no new costs and possibly have qualitative 
positive benefits by increasing the efficiency of the regulatory 
process. Of the dozens of rule changes, only eight have net positive 
costs, not including probable qualitative benefits. Our estimates are 
shown in the table. As the table shows, we estimate undiscounted 10-
year costs to be about $2.1 million and present value (2009 dollars) 
costs to be about $1.7 million.

                                 Table 2--Summary Table of Costs by Rule Section
----------------------------------------------------------------------------------------------------------------
                                                                             Present value
              Section No.                      Section description               costs        Undiscounted costs
----------------------------------------------------------------------------------------------------------------
Sec.   21.3(f).........................  Reporting of failures,                       $4,614              $6,942
                                          malfunctions, and defects.
Sec.   21.9(a)(4)......................  Commercial parts...............             499,890             790,596
Sec.   21.137(l).......................  PC Quality system (internal                  11,813              12,640
                                          audits).
Sec.   21.137(m).......................  PC Quality system (in-service                39,626              42,400
                                          feedback).
Sec.   21.303(a)(5)....................  PMA Application (statement of               276,262             295,600
                                          compliance).
Sec.   21.307..........................  PMA Quality system.............             415,551             444,640
Sec.   21.308..........................  PMA Quality manual.............             424,374             454,080
Sec.   21.605..........................  TSO Organization...............              22,430              24,000
                                                                         ---------------------------------------
    Total Costs.........................................................           1,694,560           2,070,898
----------------------------------------------------------------------------------------------------------------


[[Page 53383]]

Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA) 
establishes ``as a principle of regulatory issuance that agencies shall 
endeavor, consistent with the objectives of the rule and of applicable 
statutes, to fit regulatory and informational requirements to the scale 
of the businesses, organizations, and governmental jurisdictions 
subject to regulation. To achieve this principle, agencies are required 
to solicit and consider flexible regulatory proposals and to explain 
the rationale for their actions to assure that such proposals are given 
serious consideration.'' The RFA covers a wide-range of small entities, 
including small businesses, not-for-profit organizations, and small 
governmental jurisdictions.
    Agencies must perform a review to determine whether a rule will 
have a significant economic impact on a substantial number of small 
entities. If the agency determines that it will, the agency must 
prepare a regulatory flexibility analysis as described in the RFA. 
However, if an agency determines that a rule is not expected to have a 
significant economic impact on a substantial number of small entities, 
section 605(b) of the RFA provides that the head of the agency may so 
certify and a regulatory flexibility analysis is not required. The 
certification must include a statement providing the factual basis for 
this determination, and the reasoning should be clear.
    The Initial Regulatory Flexibility Analysis of this rule, published 
in the Federal Register (72 FR 6968, February 14, 2007), found a 
significant economic impact on a substantial number of small entities. 
We received numerous comments to the docket that the costs of the rule 
were prohibitive, and particularly so for small firms. The greatest 
concern was with our requirements for (1) airworthiness approvals for 
all (domestic and overseas) shipments of aircraft engines, propellers, 
and articles and (2) marking requirements for all aircraft products and 
articles. In response to these comments, the FAA has withdrawn these 
major proposals. These changes remove $187.6 million, or 99.1 percent 
of the original present value (gross) cost. As a consequence, for all 
firms in our sample of small firms affected by the rule, the annualized 
cost of the rule relative to estimated average annual revenues is less 
than 0.1 percent.
    Several comments to the docket argued that we have greatly 
underestimated the cost for PMA holders--especially small holders--to 
comply with the requirement for a quality system (Sec.  21.307) and 
quality manual (Sec.  21.308), particularly the internal audit 
provision. According to these comments, additional staff will be 
required at a cost, in the case of a one-person shop, of up to $60,000 
a year. Our reference to ISO standards and other preamble language may 
have misled these commenters. We intend that the requirements be 
scalable relative to firm size and product complexity. The complexity 
of the quality system and the size of the quality manual depend on the 
size of the PAH and the complexity of the product or articles 
manufactured. A small PMA producing a simple article requires only a 
simple quality system--Some of the quality system requirements might 
even be ``not applicable.'' In the case of a one-person shop producing 
a simple article, the internal audit provision might be not applicable 
or, if deemed applicable, might be satisfied with an audit every four 
years. The corresponding quality manual might consist of only three or 
four pages.
    Therefore, as the FAA Administrator, I certify that this rule will 
not have a significant economic impact on a substantial number of small 
entities.

International Trade Impact Assessment

    The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the 
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal 
agencies from establishing standards or engaging in related activities 
that create unnecessary obstacles to the foreign commerce of the United 
States. Pursuant to these Acts, the establishment of standards is not 
considered an unnecessary obstacle to the foreign commerce of the 
United States, so long as the standard has a legitimate domestic 
objective, such the protection of safety, and does not operate in a 
manner that excludes imports that meet this objective. The statute also 
requires consideration of international standards and, where 
appropriate, that they be the basis for U.S. standards. The FAA has 
assessed the potential effect of this proposed rule and determined that 
it would have only a domestic impact and therefore would not create 
unnecessary obstacles to the foreign commerce of the United States. We 
have assessed the potential effect of this rule and determined it 
complies with the Trade Agreements Act, as it will promote 
international trade by:
     Revising export airworthiness certificate and approval 
requirements to no longer require used aircraft to undergo an annual 
type inspections and to no longer require used engines and propellers 
to be newly overhauled; and
     Changing language in order to harmonize with bilateral 
agreements and European Union (EU) regulations.

Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each Federal agency to prepare a written statement 
assessing the effects of any Federal mandate in a proposed or final 
agency rule that may result in an expenditure of $100 million or more 
(adjusted annually for inflation with the base year 1995) in any one 
year by State, local, and tribal governments, in the aggregate, or by 
the private sector; such a mandate is deemed to be a ``significant 
regulatory action.'' The FAA currently uses an inflation-adjusted value 
of $136.1 million. This rule does not contain such a mandate. The 
requirements of Title II do not apply.

Executive Order 13132, Federalism

    The FAA has analyzed this rule under the principles and criteria of 
Executive Order 13132, Federalism. We determined that this action will 
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, 
and, therefore, does not have federalism implications.

Regulations Affecting Intrastate Aviation in Alaska

    Section 1205 of the FAA Reauthorization Act of 1996 (110 Stat. 
3213) requires the FAA, when modifying its regulations in a manner 
affecting intrastate aviation in Alaska, to consider the extent to 
which Alaska is not served by transportation modes other than aviation, 
and to establish appropriate regulatory distinctions. In the NPRM, we 
requested comments on whether the proposed rule should apply 
differently to intrastate operations in Alaska. We did not receive any 
comments, and we have determined, based on the administrative record of 
this rulemaking, that there is no need to make any regulatory 
distinctions applicable to intrastate aviation in Alaska.

Environmental Analysis

    FAA Order 1050.1E identifies FAA actions that are categorically 
excluded from preparation of an environmental assessment or 
environmental impact statement under the National Environmental Policy 
Act in the absence of extraordinary circumstances. The FAA has 
determined this

[[Page 53384]]

rulemaking action qualifies for the categorical exclusion identified in 
paragraph 308(b) and involves no extraordinary circumstances.

Regulations that Significantly Affect Energy Supply, Distribution, or 
Use

    The FAA has analyzed this NPRM under Executive Order 13211, Actions 
Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (May 18, 2001). We have determined that it is not 
a ``significant energy action'' under the executive order because while 
it is a ``significant regulatory action,'' it is not likely to have a 
significant adverse effect on the supply, distribution, or use of 
energy.

Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires FAA to comply with small entity requests for information 
or advice about compliance with statutes and regulations within its 
jurisdiction. If you are a small entity and you have a question 
regarding this document, you may contact your local FAA official, or 
the person listed under the FOR FURTHER INFORMATION CONTACT heading at 
the beginning of the preamble. You can find out more about SBREFA on 
the Internet at http://www.faa.gov/regulations_policies/rulemaking/sbre_act/.

Availability of Rulemaking Documents

    You can get an electronic copy of rulemaking documents using the 
Internet by--
    1. Searching the Federal eRulemaking Portal (http://www.regulations.gov);
    2. Visiting the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies/; or
    3. Accessing the Government Printing Office's Web page at http://www.gpoaccess.gov/fr/index.html.
    You can also get a copy by sending a request to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue, SW., Washington, DC 20591, or by calling (202) 267-9680. Make 
sure to identify the amendment number or docket number of this 
rulemaking.
    You may access all documents the FAA considered in developing this 
final rule, including economic analyses and technical reports, from the 
Internet through the Federal eRulemaking Portal referenced in paragraph 
(1).

List of Subjects

14 CFR Part 1

    Air transportation.

14 CFR Part 21

    Aircraft, Aviation safety, Exports, Imports, Reporting and 
recordkeeping requirements.

14 CFR Part 43

    Aircraft, Aviation safety, Reporting and recordkeeping 
requirements.

14 CFR Part 45

    Aircraft, Exports, Signs and symbols.

The Amendment

0
In consideration of the foregoing, the Federal Aviation Administration 
amends Chapter I of Title 14, Code of Federal Regulations parts 1, 21, 
43, and 45 as follows:

PART 1--DEFINITIONS AND ABBREVIATIONS

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

    Authority: 49 U.S.C. 106(g), 40113, 44701.


0
2. Amend Sec.  1.1 by revising the definition of ``Approved'' to read 
as follows:


Sec.  1.1  General definitions.

* * * * *
    Approved, unless used with reference to another person, means 
approved by the FAA or any person to whom the FAA has delegated its 
authority in the matter concerned, or approved under the provisions of 
a bilateral agreement between the United States and a foreign country 
or jurisdiction.
* * * * *

0
3. Amend Sec.  1.2 by adding the abbreviations PMA and TSO in 
alphabetical order to read as follows:


Sec.  1.2  Abbreviations and symbols.

* * * * *
    PMA means parts manufacturer approval.
* * * * *
    TSO means technical standard order.
* * * * *

PART 21--CERTIFICATION PROCEDURES FOR PRODUCTS, ARTICLES, AND PARTS

0
4. The authority citation for part 21 continues to read as follows:

    Authority:  42 U.S.C. 7572; 49 U.S.C. 106(g), 40105, 40113, 
44701-44702, 44704, 44707, 44709, 44711, 44713, 44715, 45303.

PART 21 [AMENDED]

0
5. Amend part 21 by:
0
a. Removing the word ``Administrator'' and adding in its place the word 
``FAA'' wherever it appears;
0
b. Removing the word ``shall'' and adding in its place the word 
``must'' wherever it appears; and
0
c. Removing the phrase ``type certificate only'' and adding in its 
place the phrase ``type certificate'' wherever it appears.

0
6. Revise Sec.  21.1 to read as follows:


Sec.  21.1  Applicability and definitions.

    (a) This part prescribes--
    (1) Procedural requirements for issuing and changing--
    (i) Design approvals;
    (ii) Production approvals;
    (iii) Airworthiness certificates; and
    (iv) Airworthiness approvals;
    (2) Rules governing applicants for, and holders of, any approval or 
certificate specified in paragraph (a)(1) of this section; and
    (3) Procedural requirements for the approval of articles.
    (b) For the purposes of this part--
    (1) Airworthiness approval means a document issued by the FAA for 
an aircraft, aircraft engine, propeller, or article which certifies 
that the aircraft, aircraft engine, propeller, or article conforms to 
its approved design and is in a condition for safe operation;
    (2) Article means a material, part, component, process, or 
appliance;
    (3) Commercial part means an article that is listed on an FAA-
approved Commercial Parts List included in a design approval holder's 
Instructions for Continued Airworthiness required by Sec.  21.50;
    (4) Design approval means a type certificate (including amended and 
supplemental type certificates) or the approved design under a PMA, TSO 
authorization, letter of TSO design approval, or other approved design;
    (5) Product means an aircraft, aircraft engine, or propeller;
    (6) Production approval means a document issued by the FAA to a 
person that allows the production of a product or article in accordance 
with its approved design and approved quality system, and can take the 
form of a production certificate, a PMA, or a TSO authorization;
    (7) State of Design means the country or jurisdiction having 
regulatory authority over the organization responsible for the design 
and continued airworthiness of a civil aeronautical product or article;
    (8) State of Manufacture means the country or jurisdiction having 
regulatory authority over the organization responsible for the 
production and airworthiness of a civil aeronautical product or 
article.

0
7. Amend Sec.  21.2 by revising paragraphs (a) introductory text, 
(a)(1), (a)(2), and (b) to read as follows:

[[Page 53385]]

Sec.  21.2  Falsification of applications, reports, or records.

    (a) A person may not make or cause to be made--
    (1) Any fraudulent, intentionally false, or misleading statement on 
any application for a certificate or approval under this part;
    (2) Any fraudulent, intentionally false, or misleading statement in 
any record or report that is kept, made, or used to show compliance 
with any requirement of this part;
* * * * *
    (b) The commission by any person of an act prohibited under 
paragraph (a) of this section is a basis for--
    (1) Denying issuance of any certificate or approval under this 
part; and
    (2) Suspending or revoking any certificate or approval issued under 
this part and held by that person.

0
8. Amend Sec.  21.3 by revising paragraphs (a), (b), (d)(1), (d)(2), 
(e)(3), and (f) to read as follows:


Sec.  21.3  Reporting of failures, malfunctions, and defects.

    (a) The holder of a type certificate (including amended or 
supplemental type certificates), a PMA, or a TSO authorization, or the 
licensee of a type certificate must report any failure, malfunction, or 
defect in any product or article manufactured by it that it determines 
has resulted in any of the occurrences listed in paragraph (c) of this 
section.
    (b) The holder of a type certificate (including amended or 
supplemental type certificates), a PMA, or a TSO authorization, or the 
licensee of a type certificate must report any defect in any product or 
article manufactured by it that has left its quality system and that it 
determines could result in any of the occurrences listed in paragraph 
(c) of this section.
* * * * *
    (d) * * *
    (1) Failures, malfunctions, or defects that the holder of a type 
certificate (including amended or supplemental type certificates), PMA, 
TSO authorization, or the licensee of a type certificate determines--
    (i) Were caused by improper maintenance or use;
    (ii) Were reported to the FAA by another person under this chapter; 
or
    (iii) Were reported under the accident reporting provisions of 49 
CFR part 830 of the regulations of the National Transportation Safety 
Board.
    (2) Failures, malfunctions, or defects in products or articles--
    (i) Manufactured by a foreign manufacturer under a U.S. type 
certificate issued under Sec.  21.29 or under an approval issued under 
Sec.  21.621; or
    (ii) Exported to the United States under Sec.  21.502.
    (e) * * *
    (3) Must include as much of the following information as is 
available and applicable:
    (i) The applicable product and article identification information 
required by part 45 of this chapter;
    (ii) Identification of the system involved; and
    (iii) Nature of the failure, malfunction, or defect.
    (f) If an accident investigation or service difficulty report shows 
that a product or article manufactured under this part is unsafe 
because of a manufacturing or design data defect, the holder of the 
production approval for that product or article must, upon request of 
the FAA, report to the FAA the results of its investigation and any 
action taken or proposed by the holder of that production approval to 
correct that defect. If action is required to correct the defect in an 
existing product or article, the holder of that production approval 
must send the data necessary for issuing an appropriate airworthiness 
directive to the appropriate aircraft certification office.

0
9. Amend Sec.  21.5 by revising paragraph (a) to read as follows:


Sec.  21.5  Airplane or Rotorcraft Flight Manual.

    (a) With each airplane or rotorcraft not type certificated with an 
Airplane or Rotorcraft Flight Manual and having no flight time before 
March 1, 1979, the holder of a type certificate (including amended or 
supplemental type certificates) or the licensee of a type certificate 
must make available to the owner at the time of delivery of the 
aircraft a current approved Airplane or Rotorcraft Flight Manual.
* * * * *

0
10. Amend subpart A by adding Sec.  21.8 to read as follows:


Sec.  21.8  Approval of articles.

    If an article is required to be approved under this chapter, it may 
be approved--
    (a) Under a PMA;
    (b) Under a TSO;
    (c) In conjunction with type certification procedures for a 
product; or
    (d) In any other manner approved by the FAA.

0
11. Amend subpart A by adding Sec.  21.9 to read as follows:


Sec.  21.9  Replacement and modification articles.

    (a) If a person knows, or should know, that a replacement or 
modification article is reasonably likely to be installed on a type-
certificated product, the person may not produce that article unless it 
is--
    (1) Produced under a type certificate;
    (2) Produced under an FAA production approval;
    (3) A standard part (such as a nut or bolt) manufactured in 
compliance with a government or established industry specification;
    (4) A commercial part as defined in Sec.  21.1 of this part;
    (5) Produced by an owner or operator for maintaining or altering 
that owner or operator's product; or
    (6) Fabricated by an appropriately rated certificate holder with a 
quality system, and consumed in the repair or alteration of a product 
or article in accordance with part 43 of this chapter.
    (b) Except as provided in paragraphs (a)(1) through (a)(4) of this 
section, a person who produces a replacement or modification article 
for sale may not represent that part as suitable for installation on a 
type-certificated product.
    (c) Except as provided in paragraphs (a)(1) through (a)(4) of this 
section, a person may not sell or represent an article as suitable for 
installation on an aircraft type-certificated under Sec. Sec.  
21.25(a)(2) or 21.27 unless that article--
    (1) Was declared surplus by the U.S. Armed Forces, and
    (2) Was intended for use on that aircraft model by the U.S. Armed 
Forces.


Sec.  21.15  [Amended]

0
12. Amend Sec.  21.15 by removing the words ``Aircraft Certification 
Office'' in paragraph (a) and adding, in their place, the words 
``aircraft certification office''.

0
13. Amend subpart B by adding Sec.  21.20 to read as follows:


Sec.  21.20  Compliance with applicable requirements.

    The applicant for a type certificate, including an amended or 
supplemental type certificate, must--
    (a) Show compliance with all applicable requirements and must 
provide the FAA the means by which such compliance has been shown; and
    (b) Provide a statement certifying that the applicant has complied 
with the applicable requirements.


Sec.  21.21  [Amended]

0
14. Amend Sec.  21.21 by removing the words ``the Federal Aviation 
Regulations'' and add in their place the words ``this subchapter'' 
wherever they appear.

[[Page 53386]]

Sec.  21.27  [Amended]

0
15. Amend Sec.  21.27 as follows:
0
a. Remove the words ``the Federal Aviation Regulations'' in paragraph 
(c) and add, in their place, the words ``this subchapter''; and
0
b. Remove the word ``FAR'' from each place it appears in the table in 
paragraph (f) and add in its place the words ``14 CFR''.

0
16. Revise Sec.  21.29 to read as follows:


Sec.  21.29  Issue of type certificate: import products.

    (a) The FAA may issue a type certificate for a product that is 
manufactured in a foreign country or jurisdiction with which the United 
States has an agreement for the acceptance of these products for export 
and import and that is to be imported into the United States if--
    (1) The applicable State of Design certifies that the product has 
been examined, tested, and found to meet--
    (i) The applicable aircraft noise, fuel venting, and exhaust 
emissions requirements of this subchapter as designated in Sec.  21.17, 
or the applicable aircraft noise, fuel venting, and exhaust emissions 
requirements of the State of Design, and any other requirements the FAA 
may prescribe to provide noise, fuel venting, and exhaust emission 
levels no greater than those provided by the applicable aircraft noise, 
fuel venting, and exhaust emission requirements of this subchapter as 
designated in Sec.  21.17; and
    (ii) The applicable airworthiness requirements of this subchapter 
as designated in Sec.  21.17, or the applicable airworthiness 
requirements of the State of Design and any other requirements the FAA 
may prescribe to provide a level of safety equivalent to that provided 
by the applicable airworthiness requirements of this subchapter as 
designated in Sec.  21.17;
    (2) The applicant has provided technical data to show the product 
meets the requirements of paragraph (a)(1) of this section; and
    (3) The manuals, placards, listings, and instrument markings 
required by the applicable airworthiness (and noise, where applicable) 
requirements are presented in the English language.
    (b) A product type certificated under this section is considered to 
be type certificated under the noise standards of part 36 of this 
subchapter and the fuel venting and exhaust emission standards of part 
34 of this subchapter. Compliance with parts 36 and 34 of this 
subchapter is certified under paragraph (a)(1)(i) of this section, and 
the applicable airworthiness standards of this subchapter, or an 
equivalent level of safety, with which compliance is certified under 
paragraph (a)(1)(ii) of this section.


Sec.  21.33  [Amended]

0
17. Amend Sec.  21.33(a) introductory text by removing the words ``the 
Federal Aviation Regulations'' and adding, in their place, the words 
``this subchapter''.


Sec.  21.45  [Amended]

0
18. Amend Sec.  21.45 as follows:
0
a. Remove the words ``or certified'' from paragraph (b) and add in 
their place the words ``on certificated''; and
0
b. Remove the reference ``Sec. Sec.  21.133 through 21.163'' from 
paragraph (c) and add in its place the words ``subpart G of this 
part''.

0
19. Revise Sec.  21.47 to read as follows:


Sec.  21.47  Transferability.

    (a) A holder of a type certificate may transfer it or make it 
available to other persons by licensing agreements.
    (b) For a type certificate transfer in which the State of Design 
will remain the same, each transferor must, before such a transfer, 
notify in writing the appropriate aircraft certification office. This 
notification must include the applicable type certificate number, the 
name and address of the transferee, and the anticipated date of the 
transfer.
    (c) For a type certificate transfer in which the State of Design is 
changing, a type certificate may only be transferred to or from a 
person subject to the authority of another State of Design if the 
United States has an agreement with that State of Design for the 
acceptance of the affected product for export and import. Each 
transferor must notify the appropriate aircraft certification office 
before such a transfer in a form and manner acceptable to the FAA. This 
notification must include the applicable type certificate number; the 
name, address, and country of residence of the transferee; and the 
anticipated date of the transfer.
    (d) Before executing or terminating a licensing agreement that 
makes a type certificate available to another person, the type 
certificate holder must notify in writing the appropriate aircraft 
certification office. This notification must include the type 
certificate number addressed by the licensing agreement, the name and 
address of the licensee, the extent of authority granted the licensee, 
and the anticipated date of the agreement.

0
20. Amend Sec.  21.50 by revising paragraph (b) and adding paragraph 
(c) to read as follows:


Sec.  21.50  Instructions for continued airworthiness and 
manufacturer's maintenance manuals having airworthiness limitations 
sections.

* * * * *
    (b) The holder of a design approval, including either the type 
certificate or supplemental type certificate for an aircraft, aircraft 
engine, or propeller for which application was made after January 28, 
1981, must furnish at least one set of complete Instructions for 
Continued Airworthiness to the owner of each type aircraft, aircraft 
engine, or propeller upon its delivery, or upon issuance of the first 
standard airworthiness certificate for the affected aircraft, whichever 
occurs later. The Instructions must be prepared in accordance with 
Sec. Sec.  23.1529, 25.1529, 25.1729, 27.1529, 29.1529, 31.82, 33.4, 
35.4, or part 26 of this subchapter, or as specified in the applicable 
airworthiness criteria for special classes of aircraft defined in Sec.  
21.17(b), as applicable. If the holder of a design approval chooses to 
designate parts as commercial, it must include in the Instructions for 
Continued Airworthiness a list of commercial parts submitted in 
accordance with the provisions of paragraph (c) of this section. 
Thereafter, the holder of a design approval must make those 
instructions available to any other person required by this chapter to 
comply with any of the terms of those instructions. In addition, 
changes to the Instructions for Continued Airworthiness shall be made 
available to any person required by this chapter to comply with any of 
those instructions.
    (c) To designate commercial parts, the holder of a design approval, 
in a manner acceptable to the FAA, must submit:
    (1) A Commercial Parts List;
    (2) Data for each part on the List showing that:
    (i) The failure of the commercial part, as installed in the 
product, would not degrade the level of safety of the product; and
    (ii) The part is produced only under the commercial part 
manufacturer's specification and marked only with the commercial part 
manufacturer's markings; and
    (3) Any other data necessary for the FAA to approve the List.

0
21. Revise Sec.  21.53(a) to read as follows:


Sec.  21.53  Statement of conformity.

    (a) Each applicant must provide, in a form and manner acceptable to 
the FAA, a statement that each aircraft engine or

[[Page 53387]]

propeller presented for type certification conforms to its type design.
* * * * *


Sec.  21.73  [Amended]

0
22. Amend Sec.  21.73(b) by removing the words ``Any manufacturer of 
aircraft manufactured in a foreign country with which the United States 
has an agreement'' and adding in their place the words ``Any 
manufacturer of aircraft in a State of Manufacture subject to the 
provisions of an agreement with the United States''.

0
23. Revise Sec.  21.75 to read as follows:


Sec.  21.75  Application.

    Each applicant for a provisional type certificate, for an amendment 
thereto, or for a provisional amendment to a type certificate must 
apply to the appropriate aircraft certification office and provide the 
information required by this subpart.

0
24. Revise Sec.  21.97(a) to read as follows:


Sec.  21.97  Approval of major changes in type design.

    (a) An applicant for approval of a major change in type design 
must--
    (1) Provide substantiating data and necessary descriptive data for 
inclusion in the type design;
    (2) Show that the changed product complies with the applicable 
requirements of this subchapter, and provide the FAA the means by which 
such compliance has been shown; and
    (3) Provide a statement certifying that the applicant has complied 
with the applicable requirements.
* * * * *

0
25. Revise Sec.  21.113 to read as follows:


Sec.  21.113  Requirement for supplemental type certificate.

    (a) If a person holds the TC for a product and alters that product 
by introducing a major change in type design that does not require an 
application for a new TC under Sec.  21.19, that person must either 
apply to the appropriate aircraft certification office for an STC or 
apply to amend the original type certificate under subpart D of this 
part.
    (b) If a person does not hold the TC for a product and alters that 
product by introducing a major change in type design that does not 
require an application for a new TC under Sec.  21.19, that person must 
apply to the appropriate aircraft certification office for an STC.
    (c) The application for an STC must be made in the form and manner 
prescribed by the FAA.


Sec.  21.117  [Amended]

0
26. Amend Sec.  21.117 by removing the words ``if he'' from paragraph 
(a) and adding in their place the words ``if the FAA finds that the 
applicant''.
0
27. Revise Sec.  21.119(c) to read as follows:


Sec.  21.119   Privileges.

* * * * *
    (c) Obtain a production certificate in accordance with the 
requirements of subpart G of this part for the change in the type 
design approved by the supplemental type certificate.

0
28. Amend subpart F by adding Sec.  21.122 to read as follows:


Sec.  21.122  Location of or change to manufacturing facilities.

    (a) An applicant may obtain a production certificate for 
manufacturing facilities located outside of the United States if the 
FAA finds no undue burden in administering the applicable requirements 
of Title 49 U.S.C. and this subchapter.
    (b) The type certificate holder must obtain FAA approval before 
making any changes to the location of any of its manufacturing 
facilities.
    (c) The type certificate holder must immediately notify the FAA, in 
writing, of any change to the manufacturing facilities that may affect 
the inspection, conformity, or airworthiness of its product or article.

0
29. Revise Sec.  21.123 to read as follows:


Sec.  21.123  Production under type certificate.

    Each manufacturer of a product being manufactured under a type 
certificate must--
    (a) Maintain at the place of manufacture all information and data 
specified in Sec. Sec.  21.31 and 21.41;
    (b) Make each product and article thereof available for inspection 
by the FAA;
    (c) Maintain records of the completion of all inspections and tests 
required by Sec. Sec.  21.127, 21.128, and 21.129 for at least 5 years 
for the products and articles thereof manufactured under the approval 
and at least 10 years for critical components identified under Sec.  
45.15(c) of this chapter;
    (d) Allow the FAA to make any inspection or test, including any 
inspection or test at a supplier facility, necessary to determine 
compliance with this subchapter;
    (e) Mark the product in accordance with part 45 of this chapter, 
including any critical parts;
    (f) Identify any portion of that product (e.g., sub-assemblies, 
component parts, or replacement articles) that leave the manufacturer's 
facility as FAA approved with the manufacturer's part number and name, 
trademark, symbol, or other FAA-approved manufacturer's identification; 
and
    (g) Except as otherwise authorized by the FAA, obtain a production 
certificate for that product in accordance with subpart G of this part 
within 6 months after the date of issuance of the type certificate.


Sec.  21.125  [Removed and Reserved]

0
30. Remove and reserve Sec.  21.125.
0
31. Revise Sec.  21.130 to read as follows:


Sec.  21.130  Statement of Conformity.

    Each holder or licensee of a type certificate who manufactures a 
product under this subpart must provide, in a form and manner 
acceptable to the FAA, a statement that the product for which the type 
certificate has been issued conforms to its type certificate and is in 
a condition for safe operation.

0
32. Revise subpart G to read as follows:
Subpart G--Production Certificates
Sec.
21.131 Applicability.
21.132 Eligibility.
21.133 Application.
21.135 Organization.
21.137 Quality system.
21.138 Quality manual.
21.139 Location of or change to manufacturing facilities.
21.140 Inspections and tests.
21.141 Issuance.
21.142 Production limitation record.
21.143 Duration.
21.144 Transferability.
21.145 Privileges.
21.146 Responsibility of holder.
21.147 Amendment of production certificates.
21.150 Changes in quality system.

Subpart G--Production Certificates


Sec.  21.131  Applicability.

    This subpart prescribes--
    (a) Procedural requirements for issuing production certificates; 
and
    (b) Rules governing holders of those certificates.


Sec.  21.132  Eligibility.

    Any person may apply for a production certificate if that person 
holds, for the product concerned--
    (a) A current type certificate,
    (b) A supplemental type certificate, or
    (c) Rights to the benefits of that type certificate or supplemental 
type certificate under a licensing agreement.


Sec.  21.133  Application.

    Each applicant must apply for a production certificate in a form 
and manner prescribed by the FAA.

[[Page 53388]]

Sec.  21.135  Organization.

    Each applicant for or holder of a production certificate must 
provide the FAA with a document describing how its organization will 
ensure compliance with the provisions of this subpart. At a minimum, 
the document must describe assigned responsibilities and delegated 
authority, and the functional relationship of those responsible for 
quality to management and other organizational components.


Sec.  21.137  Quality system.

    Each applicant for or holder of a production certificate must 
establish and describe in writing a quality system that ensures that 
each product and article conforms to its approved design and is in a 
condition for safe operation. This quality system must include:
    (a) Design data control. Procedures for controlling design data and 
subsequent changes to ensure that only current, correct, and approved 
data is used.
    (b) Document control. Procedures for controlling quality system 
documents and data and subsequent changes to ensure that only current, 
correct, and approved documents and data are used.
    (c) Supplier control. Procedures that--
    (1) Ensure that each supplier-furnished product or article conforms 
to its approved design; and
    (2) Require each supplier to report to the production approval 
holder if a product or article has been released from that supplier and 
subsequently found not to conform to the applicable design data.
    (d) Manufacturing process control. Procedures for controlling 
manufacturing processes to ensure that each product and article 
conforms to its approved design.
    (e) Inspecting and testing. Procedures for inspections and tests 
used to ensure that each product and article conforms to its approved 
design. These procedures must include the following, as applicable:
    (1) A flight test of each aircraft produced unless that aircraft 
will be exported as an unassembled aircraft.
    (2) A functional test of each aircraft engine and each propeller 
produced.
    (f) Inspection, measuring, and test equipment control. Procedures 
to ensure calibration and control of all inspection, measuring, and 
test equipment used in determining conformity of each product and 
article to its approved design. Each calibration standard must be 
traceable to a standard acceptable to the FAA.
    (g) Inspection and test status. Procedures for documenting the 
inspection and test status of products and articles supplied or 
manufactured to the approved design.
    (h) Nonconforming product and article control. (1) Procedures to 
ensure that only products or articles that conform to their approved 
design are installed on a type-certificated product. These procedures 
must provide for the identification, documentation, evaluation, 
segregation, and disposition of nonconforming products and articles. 
Only authorized individuals may make disposition determinations.
    (2) Procedures to ensure that discarded articles are rendered 
unusable.
    (i) Corrective and preventive actions. Procedures for implementing 
corrective and preventive actions to eliminate the causes of an actual 
or potential nonconformity to the approved design or noncompliance with 
the approved quality system.
    (j) Handling and storage. Procedures to prevent damage and 
deterioration of each product and article during handling, storage, 
preservation, and packaging.
    (k) Control of quality records. Procedures for identifying, 
storing, protecting, retrieving, and retaining quality records. A 
production approval holder must retain these records for at least 5 
years for the products and articles manufactured under the approval and 
at least 10 years for critical components identified under Sec.  
45.15(c) of this chapter.
    (l) Internal audits. Procedures for planning, conducting, and 
documenting internal audits to ensure compliance with the approved 
quality system. The procedures must include reporting results of 
internal audits to the manager responsible for implementing corrective 
and preventive actions.
    (m) In-service feedback. Procedures for receiving and processing 
feedback on in-service failures, malfunctions, and defects. These 
procedures must include a process for assisting the design approval 
holder to--
    (1) Address any in-service problem involving design changes; and
    (2) Determine if any changes to the Instructions for Continued 
Airworthiness are necessary.
    (n) Quality escapes. Procedures for identifying, analyzing, and 
initiating appropriate corrective action for products or articles that 
have been released from the quality system and that do not conform to 
the applicable design data or quality system requirements.


Sec.  21.138  Quality manual.

    Each applicant for or holder of a production certificate must 
provide a manual describing its quality system to the FAA for approval. 
The manual must be in the English language and retrievable in a form 
acceptable to the FAA.


Sec.  21.139  Location of or change to manufacturing facilities.

    (a) An applicant may obtain a production certificate for 
manufacturing facilities located outside of the United States if the 
FAA finds no undue burden in administering the applicable requirements 
of Title 49 U.S.C. and this subchapter.
    (b) The production certificate holder must obtain FAA approval 
before making any changes to the location of any of its manufacturing 
facilities.
    (c) The production certificate holder must immediately notify the 
FAA, in writing, of any change to the manufacturing facilities that may 
affect the inspection, conformity, or airworthiness of its product or 
article.


Sec.  21.140  Inspections and tests.

    Each applicant for or holder of a production certificate must allow 
the FAA to inspect its quality system, facilities, technical data, and 
any manufactured products or articles and witness any tests, including 
any inspections or tests at a supplier facility, necessary to determine 
compliance with this subchapter.


Sec.  21.141  Issuance.

    The FAA issues a production certificate after finding that the 
applicant complies with the requirements of this subpart.


Sec.  21.142  Production limitation record.

    The FAA issues a production limitation record as part of a 
production certificate. The record lists the type certificate number 
and the model of every product that the production certificate holder 
is authorized to manufacture.


Sec.  21.143  Duration.

    A production certificate is effective until surrendered, suspended, 
revoked, or the FAA otherwise establishes a termination date.


Sec.  21.144  Transferability.

    The holder of a production certificate may not transfer the 
production certificate.


Sec.  21.145  Privileges.

    (a) The holder of a production certificate may--
    (1) Obtain an aircraft airworthiness certificate without further 
showing, except that the FAA may inspect the aircraft for conformity 
with the type design; or

[[Page 53389]]

    (2) In the case of other products, obtain approval from the FAA for 
installation on type-certificated aircraft.
    (b) Notwithstanding the provisions of Sec.  147.3 of this chapter, 
the holder of a production certificate for a primary category aircraft, 
or for a normal, utility, or acrobatic category aircraft of a type 
design that is eligible for a special airworthiness certificate in the 
primary category under Sec.  21.184(c), may--
    (1) Conduct training for persons in the performance of a special 
inspection and preventive maintenance program approved as a part of the 
aircraft's type design under Sec.  21.24(b), provided a person holding 
a mechanic certificate with appropriate airframe and powerplant ratings 
issued under part 65 of this chapter gives the training; and
    (2) Issue a certificate of competency to persons successfully 
completing the approved training program, provided the certificate 
specifies the aircraft make and model to which the certificate applies.


Sec.  21.146  Responsibility of holder.

    The holder of a production certificate must--
    (a) Amend the document required by Sec.  21.135 as necessary to 
reflect changes in the organization and provide these amendments to the 
FAA.
    (b) Maintain the quality system in compliance with the data and 
procedures approved for the production certificate;
    (c) Ensure that each completed product or article for which a 
production certificate has been issued, including primary category 
aircraft assembled under a production certificate by another person 
from a kit provided by the holder of the production certificate, 
presented for airworthiness certification or approval conforms to its 
approved design and is in a condition for safe operation;
    (d) Mark the product or article for which a certificate or approval 
has been issued. Marking must be in accordance with part 45 of this 
chapter, including any critical parts;
    (e) Identify any portion of the product or article (e.g., sub-
assemblies, component parts, or replacement articles) that leave the 
manufacturer's facility as FAA approved with the manufacturer's part 
number and name, trademark, symbol, or other FAA approved 
manufacturer's identification;
    (f) Have access to type design data necessary to determine 
conformity and airworthiness for each product and article produced 
under the production certificate;
    (g) Retain its production certificate and make it available to the 
FAA upon request; and
    (h) Make available to the FAA information regarding all delegation 
of authority to suppliers.


Sec.  21.147  Amendment of production certificates.

    The holder of a production certificate must apply for an amendment 
to a production certificate in a form and manner prescribed by the FAA. 
The applicant for an amendment to a production certificate to add a 
type certificate or model, or both, must comply with the applicable 
requirements of Sec. Sec.  21.137, 21.138, and 21.150.


Sec.  21.150  Changes in quality system.

    After the issuance of a production certificate--
    (a) Each change to the quality system is subject to review by the 
FAA; and
    (b) The holder of a production certificate must immediately notify 
the FAA, in writing, of any change that may affect the inspection, 
conformity, or airworthiness of its product or article.

0
33. Amend Sec.  21.183 by revising paragraphs (c), (d)(1), (d)(2) 
introductory text, and (d)(3) to read as follows:


Sec.  21.183  Issue of standard airworthiness certificates for normal, 
utility, acrobatic, commuter, and transport category aircraft; manned 
free balloons; and special classes of aircraft.

* * * * *
    (c) Import aircraft. An applicant for a standard airworthiness 
certificate for an import aircraft is entitled to that certificate if--
    (1) The aircraft is type certificated in accordance with Sec.  
21.21 or Sec.  21.29 and produced under the authority of another State 
of Manufacture;
    (2) The State of Manufacture certifies, in accordance with the 
export provisions of an agreement with the United States for import of 
that aircraft, that the aircraft conforms to the type design and is in 
condition for safe operation; and
    (3) The FAA finds that the aircraft conforms to the type design and 
is in condition for safe operation.
    (d) * * *
    (1) The applicant presents evidence to the FAA that the aircraft 
conforms to a type design approved under a type certificate or a 
supplemental type certificate and to applicable Airworthiness 
Directives;
    (2) The aircraft (except an experimentally certificated aircraft 
that previously had been issued a different airworthiness certificate 
under this section) has been inspected in accordance with the 
performance rules for 100-hour inspections set forth in Sec.  43.15 of 
this chapter, or an equivalent performance standard acceptable to the 
FAA, and found airworthy by--
* * * * *
    (3) The FAA finds after inspection, that the aircraft conforms to 
the type design, and is in condition for safe operation.
* * * * *

0
34. Revise Sec.  21.185(c) to read as follows:


Sec.  21.185  Issue of airworthiness certificates for restricted 
category aircraft.

* * * * *
    (c) Import aircraft. An applicant for the original issue of a 
special airworthiness certificate for a restricted category import 
aircraft is entitled to that certificate if--
    (1) The aircraft is type-certificated in accordance with Sec.  
21.25 or Sec.  21.29 and produced under the authority of another State 
of Manufacture;
    (2) The State of Manufacture certifies, in accordance with the 
export provisions of an agreement with the United States for import of 
that aircraft that the aircraft conforms to the type design and is in 
condition for safe operation; and
    (3) The FAA finds that the aircraft conforms to the type design and 
is in condition for safe operation.
* * * * *

0
35. Revise Sec.  21.195(d)(2) to read as follows:


Sec.  21.195  Experimental certificates: Aircraft to be used for market 
surveys, sales demonstrations, and customer crew training.

* * * * *
    (d) * * *
    (2) The applicant shows that the aircraft has been flown for at 
least 50 hours, or for at least 5 hours if it is a type certificated 
aircraft which has been modified. The FAA may reduce these operational 
requirements if the applicant provides adequate justification.

0
36. Revise Sec.  21.197(c) to read as follows:


Sec.  21.197  Special flight permits.

* * * * *
    (c) Upon application, as prescribed in Sec. Sec.  91.1017 or 119.51 
of this chapter, a special flight permit with a continuing 
authorization may be issued for aircraft that may not meet applicable 
airworthiness requirements, but are capable of safe flight for the 
purpose of flying aircraft to a base where maintenance or alterations 
are to be

[[Page 53390]]

performed. The permit issued under this paragraph is an authorization, 
including conditions and limitations for flight, which is set forth in 
the certificate holder's operations specifications. The permit issued 
under this paragraph may be issued to--
    (1) Certificate holders authorized to conduct operations under part 
119 of this chapter, that have an approved program for continuing 
flight authorization; or
    (2) Management specification holders authorized to conduct 
operations under part 91, subpart K of this chapter for those aircraft 
they operate and maintain under a continuous airworthiness maintenance 
program prescribed by Sec.  91.1411 of this chapter.


Sec.  21.223  [Amended]

0
37. Amend Sec.  21.223 by removing the word ``control'' from paragraph 
(c).


Sec.  21.225  [Amended]

0
38. Amend Sec.  21.225 by removing the word ``control'' from paragraph 
(b).


Sec.  21.231  [Amended]

0
39. Amend Sec.  21.231(a)(6) by removing the words ``paragraph (a)(4)'' 
and adding in their place the words ``paragraph (a)(5)''.


Sec.  21.251  [Amended]

0
40. Amend Sec.  21.251(b)(4)(iii) and (b)(4)(iv) as follows:
    a. Remove the words ``(FAA Form 8130-3)'' in both paragraphs; and
    b. Remove the words ``Airworthiness approval tags'' and add in 
their place the words ``Airworthiness approvals'' in both paragraphs.


Sec.  21.253  [Amended]

0
41. Amend Sec.  21.253 by removing the words ``(FAA Form 312)'' from 
paragraph (a)(1).
0
42. Revise Sec.  21.267(d) to read as follows:


Sec.  21.267  Production certificates.

* * * * *
    (d) After placing the manufacturing and quality system data 
required by Sec.  21.137 with the data required by Sec.  
21.293(a)(1)(ii), a statement certifying that this has been done.


Sec.  21.271  [Amended]

0
43. Amend Sec.  21.271(a) by removing the words ``(FAA Form 8130-3)''.
0
44. Revise Sec.  21.293(a)(2) introductory text to read as follows:


Sec.  21.293  Current records.

    (a) * * *
    (2) For 5 years--
* * * * *

0
45. Revise subpart K to read as follows:
Subpart K--Parts Manufacturer Approvals
Sec.
21.301 Applicability.
21.303 Application.
21.305 Organization.
21.307 Quality system.
21.308 Quality manual.
21.309 Location of or change to manufacturing facilities.
21.310 Inspections and tests.
21.311 Issuance.
21.313 Duration.
21.314 Transferability.
21.316 Responsibility of holder.
21.319 Design changes.
21.320 Changes in quality system.

Subpart K--Parts Manufacturer Approvals


Sec.  21.301  Applicability.

    This subpart prescribes--
    (a) Procedural requirements for issuing PMAs; and
    (b) Rules governing holders of PMAs.


Sec.  21.303  Application.

    (a) The applicant for a PMA must apply in a form and manner 
prescribed by the FAA, and include the following:
    (1) The identity of the product on which the article is to be 
installed.
    (2) The name and address of the manufacturing facilities at which 
these articles are to be manufactured.
    (3) The design of the article, which consists of--
    (i) Drawings and specifications necessary to show the configuration 
of the article; and
    (ii) Information on dimensions, materials, and processes necessary 
to define the structural strength of the article.
    (4) Test reports and computations necessary to show that the design 
of the article meets the airworthiness requirements of this subchapter. 
The test reports and computations must be applicable to the product on 
which the article is to be installed, unless the applicant shows that 
the design of the article is identical to the design of a article that 
is covered under a type certificate. If the design of the article was 
obtained by a licensing agreement, the applicant must provide evidence 
of that agreement.
    (5) An applicant for a PMA based on test reports and computations 
must provide a statement certifying that the applicant has complied 
with the airworthiness requirements of this subchapter.
    (b) Each applicant for a PMA must make all inspections and tests 
necessary to determine--
    (1) Compliance with the applicable airworthiness requirements;
    (2) That materials conform to the specifications in the design;
    (3) That the article conforms to its approved design; and
    (4) That the manufacturing processes, construction, and assembly 
conform to those specified in the design.


Sec.  21.305  Organization.

    Each applicant for or holder of a PMA must provide the FAA with a 
document describing how its organization will ensure compliance with 
the provisions of this subpart. At a minimum, the document must 
describe assigned responsibilities and delegated authority, and the 
functional relationship of those responsible for quality to management 
and other organizational components.


Sec.  21.307  Quality system.

    Each applicant for or holder of a PMA must establish a quality 
system that meets the requirements of Sec.  21.137.


Sec.  21.308  Quality manual.

    Each applicant for or holder of a PMA must provide a manual 
describing its quality system to the FAA for approval. The manual must 
be in the English language and retrievable in a form acceptable to the 
FAA.


Sec.  21.309  Location of or change to manufacturing facilities.

    (a) An applicant may obtain a PMA for manufacturing facilities 
located outside of the United States if the FAA finds no undue burden 
in administering the applicable requirements of Title 49 U.S.C. and 
this subchapter.
    (b) The PMA holder must obtain FAA approval before making any 
changes to the location of any of its manufacturing facilities.
    (c) The PMA holder must immediately notify the FAA, in writing, of 
any change to the manufacturing facilities that may affect the 
inspection, conformity, or airworthiness of its PMA article.


Sec.  21.310  Inspections and tests.

    (a) Each applicant for or holder of a PMA must allow the FAA to 
inspect its quality system, facilities, technical data, and any 
manufactured articles and witness any tests, including any inspections 
or tests at a supplier facility, necessary to determine compliance with 
this subchapter.
    (b) Unless otherwise authorized by the FAA, the applicant or 
holder--
    (1) May not present any article to the FAA for an inspection or 
test unless compliance with Sec.  21.303(b)(2) through (4) has been 
shown for that article; and
    (2) May not make any change to an article between the time that 
compliance with Sec.  21.303(b)(2) through

[[Page 53391]]

(4) is shown for that article and the time that the article is 
presented to the FAA for the inspection or test.


Sec.  21.311  Issuance.

    The FAA issues a PMA after finding that the applicant complies with 
the requirements of this subpart and the design complies with the 
requirements of this chapter applicable to the product on which the 
article is to be installed.


Sec.  21.313  Duration.

    A PMA is effective until surrendered, withdrawn, or the FAA 
otherwise terminates it.


Sec.  21.314  Transferability.

    The holder of a PMA may not transfer the PMA.


Sec.  21.316  Responsibility of holder.

    Each holder of a PMA must--
    (a) Amend the document required by Sec.  21.305 as necessary to 
reflect changes in the organization and provide these amendments to the 
FAA;
    (b) Maintain the quality system in compliance with the data and 
procedures approved for the PMA;
    (c) Ensure that each PMA article conforms to its approved design 
and is in a condition for safe operation;
    (d) Mark the PMA article for which an approval has been issued. 
Marking must be in accordance with part 45 of this chapter, including 
any critical parts;
    (e) Identify any portion of the PMA article (e.g., sub-assemblies, 
component parts, or replacement articles) that leave the manufacturer's 
facility as FAA approved with the manufacturer's part number and name, 
trademark, symbol, or other FAA approved manufacturer's identification;
    (f) Have access to design data necessary to determine conformity 
and airworthiness for each article produced under the PMA;
    (g) Retain each document granting PMA and make it available to the 
FAA upon request; and
    (h) Make available to the FAA information regarding all delegation 
of authority to suppliers.


Sec.  21.319  Design changes.

    (a) Classification of design changes. (1) A ``minor change'' to the 
design of an article produced under a PMA is one that has no 
appreciable effect on the approval basis.
    (2) A ``major change'' to the design of an article produced under a 
PMA is any change that is not minor.
    (b) Approval of design changes. (1) Minor changes to the basic 
design of a PMA may be approved using a method acceptable to the FAA.
    (2) The PMA holder must obtain FAA approval of any major change 
before including it in the design of an article produced under a PMA.


Sec.  21.320  Changes in quality system.

    After the issuance of a PMA--
    (a) Each change to the quality system is subject to review by the 
FAA; and
    (b) The holder of the PMA must immediately notify the FAA, in 
writing, of any change that may affect the inspection, conformity, or 
airworthiness of its article.

0
46. Revise subpart L to read as follows:
Subpart L--Export Airworthiness Approvals
Sec.
21.321 Applicability.
21.325 Export airworthiness approvals.
21.327 Application.
21.329 Issuance of export certificates of airworthiness.
21.331 Issuance of export airworthiness approvals for aircraft 
engines, propellers, and articles.
21.335 Responsibilities of exporters.

Subpart L--Export Airworthiness Approvals


Sec.  21.321  Applicability.

    This subpart prescribes--
    (a) Procedural requirements for issuing export airworthiness 
approvals; and
    (b) Rules governing the holders of those approvals.


Sec.  21.325  Export airworthiness approvals.

    (a) An export airworthiness approval for an aircraft is issued in 
the form of an export certificate of airworthiness. This certificate 
does not authorize operation of that aircraft.
    (b) The FAA prescribes the form and manner in which an export 
airworthiness approval for an aircraft engine, propeller, or article is 
issued.
    (c) If the FAA finds no undue burden in administering the 
applicable requirements of Title 49 U.S.C. and this subchapter, an 
export airworthiness approval may be issued for a product or article 
located outside of the United States.


Sec.  21.327  Application.

    Any person may apply for an export airworthiness approval. Each 
applicant must apply in a form and manner prescribed by the FAA.


Sec.  21.329  Issuance of export certificates of airworthiness.

    (a) A person may obtain from the FAA an export certificate of 
airworthiness for an aircraft if--
    (1) A new or used aircraft manufactured under subpart F or G of 
this part meets the airworthiness requirements under subpart H of this 
part for a--
    (i) Standard airworthiness certificate; or
    (ii) Special airworthiness certificate in either the ``primary'' or 
the ``restricted'' category; or
    (2) A new or used aircraft not manufactured under subpart F or G of 
this part has a valid--
    (i) Standard airworthiness certificate; or
    (ii) Special airworthiness certificate in either the ``primary'' or 
the ``restricted'' category.
    (b) An aircraft need not meet a requirement specified in paragraph 
(a) of this section, as applicable, if--
    (1) The importing country or jurisdiction accepts, in a form and 
manner acceptable to the FAA, a deviation from that requirement; and
    (2) The export certificate of airworthiness lists as an exception 
any difference between the aircraft to be exported and its type design.


Sec.  21.331  Issuance of export airworthiness approvals for aircraft 
engines, propellers, and articles.

    (a) A person may obtain from the FAA an export airworthiness 
approval to export a new aircraft engine, propeller, or article that is 
manufactured under this part if it conforms to its approved design and 
is in a condition for safe operation.
    (b) A new aircraft engine, propeller, or article need not meet a 
requirement of paragraph (a) of this section if--
    (1) The importing country or jurisdiction accepts, in a form and 
manner acceptable to the FAA, a deviation from that requirement; and
    (2) The export airworthiness approval lists as an exception any 
difference between the aircraft engine, propeller, or article to be 
exported and its approved design.
    (c) A person may obtain from the FAA an export airworthiness 
approval to export a used aircraft engine, propeller, or article if it 
conforms to its approved design and is in a condition for safe 
operation.
    (d) A used aircraft engine or propeller need not meet a requirement 
of paragraph (c) of this section if--
    (1) The importing country or jurisdiction accepts, in a form and 
manner acceptable to the FAA, a deviation from that requirement; and
    (2) The export airworthiness approval lists as an exception any 
difference between the used aircraft engine or propeller to be exported 
and its approved design.


Sec.  21.335  Responsibilities of exporters.

    Unless otherwise agreed to by the importing country or 
jurisdiction, each exporter must--

[[Page 53392]]

    (a) Forward to the importing country or jurisdiction all documents 
specified by that country or jurisdiction;
    (b) Preserve and package products and articles as necessary to 
protect them against corrosion and damage during transit or storage and 
state the duration of effectiveness of such preservation and packaging;
    (c) Remove or cause to be removed any temporary installation 
incorporated on an aircraft for the purpose of export delivery and 
restore the aircraft to the approved configuration upon completion of 
the delivery flight;
    (d) Secure all proper foreign entry clearances from all the 
countries or jurisdictions involved when conducting sales 
demonstrations or delivery flights; and
    (e) When title to an aircraft passes or has passed to a foreign 
purchaser--
    (1) Request cancellation of the U.S. registration and airworthiness 
certificates from the FAA, giving the date of transfer of title, and 
the name and address of the foreign owner;
    (2) Return the Registration and Airworthiness Certificates to the 
FAA; and
    (3) Provide a statement to the FAA certifying that the U.S. 
identification and registration numbers have been removed from the 
aircraft in compliance with Sec.  45.33.

0
47. Revise subpart N to read as follows:
Subpart N--Acceptance of Aircraft Engines, Propellers, and Articles for 
Import
Sec.
21.500 Acceptance of aircraft engines and propellers.
21.502 Acceptance of articles.

Subpart N--Acceptance of Aircraft Engines, Propellers, and Articles 
for Import


Sec.  21.500  Acceptance of aircraft engines and propellers.

    An aircraft engine or propeller manufactured in a foreign country 
or jurisdiction meets the requirements for acceptance under this 
subchapter if--
    (a) That country or jurisdiction is subject to the provisions of an 
agreement with the United States for the acceptance of that product;
    (b) That product is marked in accordance with part 45 of this 
chapter; and
    (c) The holder or licensee of a U.S. type certificate for that 
product furnishes with each such aircraft engine or propeller imported 
into the United States, an export airworthiness approval issued in 
accordance with the provisions of that agreement certifying that the 
individual aircraft engine or propeller--
    (1) Conforms to its U.S. type certificate and is in condition for 
safe operation; and
    (2) Has been subjected by the manufacturer to a final operational 
check.


Sec.  21.502  Acceptance of articles.

    An article (including an article produced under a letter of TSO 
design approval) manufactured in a foreign country or jurisdiction 
meets the requirements for acceptance under this subchapter if--
    (a) That country or jurisdiction is subject to the provisions of an 
agreement with the United States for the acceptance of that article;
    (b) That article is marked in accordance with part 45 of this 
chapter; and
    (c) An export airworthiness approval has been issued in accordance 
with the provisions of that agreement for that article for import into 
the United States.

0
48. Revise subpart O to read as follows:
Subpart O--Technical Standard Order Approvals
Sec.
21.601 Applicability and definitions.
21.603 Application.
21.605 Organization.
21.607 Quality system.
21.608 Quality manual.
21.609 Location of or change to manufacturing facilities.
21.610 Inspections and tests.
21.611 Issuance.
21.613 Duration.
21.614 Transferability.
21.616 Responsibility of holder.
21.618 Approval for deviation.
21.619 Design changes.
21.620 Changes in quality system.
21.621 Issue of letters of TSO design approval: import articles.

Subpart O--Technical Standard Order Approvals


Sec.  21.601  Applicability and definitions.

    (a) This subpart prescribes--
    (1) Procedural requirements for issuing TSO authorizations;
    (2) Rules governing the holders of TSO authorizations; and
    (3) Procedural requirements for issuing letters of TSO design 
approval.
    (b) For the purposes of this subpart--
    (1) A TSO issued by the FAA is a minimum performance standard for 
specified articles used on civil aircraft;
    (2) A TSO authorization is an FAA design and production approval 
issued to the manufacturer of an article that has been found to meet a 
specific TSO;
    (3) A letter of TSO design approval is an FAA design approval for 
an article that has been found to meet a specific TSO in accordance 
with the procedures of Sec.  21.621;
    (4) An article manufactured under a TSO authorization, an FAA 
letter of acceptance as described in Sec.  21.613(b), or an article 
manufactured under a letter of TSO design approval described in Sec.  
21.621 is an approved article for the purpose of meeting the 
regulations of this chapter that require the article to be approved; 
and
    (5) An article manufacturer is the person who controls the design 
and quality of the article produced (or to be produced, in the case of 
an application), including any related parts, processes, or services 
procured from an outside source.


Sec.  21.603  Application.

    (a) An applicant for a TSO authorization must apply to the 
appropriate aircraft certification office in the form and manner 
prescribed by the FAA. The applicant must include the following 
documents in the application:
    (1) A statement of conformance certifying that the applicant has 
met the requirements of this subpart and that the article concerned 
meets the applicable TSO that is effective on the date of application 
for that article.
    (2) One copy of the technical data required in the applicable TSO.
    (b) If the applicant anticipates a series of minor changes in 
accordance with Sec.  21.619, the applicant may set forth in its 
application the basic model number of the article and the part number 
of the components with open brackets after it to denote that suffix 
change letters or numbers (or combinations of them) will be added from 
time to time.
    (c) If the application is deficient, the applicant must, when 
requested by the FAA, provide any additional information necessary to 
show compliance with this part. If the applicant fails to provide the 
additional information within 30 days after the FAA's request, the FAA 
denies the application and notifies the applicant.


Sec.  21.605  Organization.

    Each applicant for or holder of a TSO authorization must provide 
the FAA with a document describing how the applicant's organization 
will ensure compliance with the provisions of this subpart. At a 
minimum, the document must describe assigned responsibilities and 
delegated authority, and the functional relationship of those 
responsible for quality to management and other organizational 
components.

[[Page 53393]]

Sec.  21.607  Quality system.

    Each applicant for or holder of a TSO authorization must establish 
a quality system that meets the requirements of Sec.  21.137.


Sec.  21.608  Quality manual.

    Each applicant for or holder of a TSO authorization must provide a 
manual describing its quality system to the FAA for approval. The 
manual must be in the English language and retrievable in a form 
acceptable to the FAA.


Sec.  21.609  Location of or change to manufacturing facilities.

    (a) An applicant may obtain a TSO authorization for manufacturing 
facilities located outside of the United States if the FAA finds no 
undue burden in administering the applicable requirements of Title 49 
U.S.C. and this subchapter.
    (b) The TSO authorization holder must obtain FAA approval before 
making any changes to the location of any of its manufacturing 
facilities.
    (c) The TSO authorization holder must immediately notify the FAA, 
in writing, of any change to the manufacturing facilities that may 
affect the inspection, conformity, or airworthiness of its product or 
article.


Sec.  21.610  Inspections and tests.

    Each applicant for or holder of a TSO authorization must allow the 
FAA to inspect its quality system, facilities, technical data, and any 
manufactured articles and witness any tests, including any inspections 
or tests at a supplier facility, necessary to determine compliance with 
this subchapter.


Sec.  21.611  Issuance.

    If the FAA finds that the applicant complies with the requirements 
of this subchapter, the FAA issues a TSO authorization to the applicant 
(including all TSO deviations granted to the applicant).


Sec.  21.613  Duration.

    (a) A TSO authorization or letter of TSO design approval is 
effective until surrendered, withdrawn, or otherwise terminated by the 
FAA.
    (b) If a TSO is revised or canceled, the holder of an affected FAA 
letter of acceptance of a statement of conformance, TSO authorization, 
or letter of TSO design approval may continue to manufacture articles 
that meet the original TSO without obtaining a new acceptance, 
authorization, or approval but must comply with the requirements of 
this chapter.


Sec.  21.614  Transferability.

    The holder of a TSO authorization or letter of TSO design approval 
may not transfer the TSO authorization or letter of TSO design 
approval.


Sec.  21.616  Responsibility of holder.

    Each holder of a TSO authorization must--
    (a) Amend the document required by Sec.  21.605 as necessary to 
reflect changes in the organization and provide these amendments to the 
FAA.
    (b) Maintain a quality system in compliance with the data and 
procedures approved for the TSO authorization;
    (c) Ensure that each manufactured article conforms to its approved 
design, is in a condition for safe operation, and meets the applicable 
TSO;
    (d) Mark the TSO article for which an approval has been issued. 
Marking must be in accordance with part 45 of this chapter, including 
any critical parts;
    (e) Identify any portion of the TSO article (e.g., sub-assemblies, 
component parts, or replacement articles) that leave the manufacturer's 
facility as FAA approved with the manufacturer's part number and name, 
trademark, symbol, or other FAA approved manufacturer's identification;
    (f) Have access to design data necessary to determine conformity 
and airworthiness for each article produced under the TSO 
authorization. The manufacturer must retain this data until it no 
longer manufactures the article. At that time, copies of the data must 
be sent to the FAA;
    (g) Retain its TSO authorization and make it available to the FAA 
upon request; and
    (h) Make available to the FAA information regarding all delegation 
of authority to suppliers.


Sec.  21.618  Approval for deviation.

    (a) Each manufacturer who requests approval to deviate from any 
performance standard of a TSO must show that factors or design features 
providing an equivalent level of safety compensate for the standards 
from which a deviation is requested.
    (b) The manufacturer must send requests for approval to deviate, 
together with all pertinent data, to the appropriate aircraft 
certification office. If the article is manufactured under the 
authority of a foreign country or jurisdiction, the manufacturer must 
send requests for approval to deviate, together with all pertinent 
data, through the civil aviation authority of that country or 
jurisdiction to the FAA.


Sec.  21.619  Design changes.

    (a) Minor changes by the manufacturer holding a TSO authorization. 
The manufacturer of an article under an authorization issued under this 
part may make minor design changes (any change other than a major 
change) without further approval by the FAA. In this case, the changed 
article keeps the original model number (part numbers may be used to 
identify minor changes) and the manufacturer must forward to the 
appropriate aircraft certification office, any revised data that are 
necessary for compliance with Sec.  21.603(b).
    (b) Major changes by the manufacturer holding a TSO authorization. 
Any design change by the manufacturer extensive enough to require a 
substantially complete investigation to determine compliance with a TSO 
is a major change. Before making a major change, the manufacturer must 
assign a new type or model designation to the article and apply for an 
authorization under Sec.  21.603.
    (c) Changes by persons other than the manufacturer. No design 
change by any person (other than the manufacturer who provided the 
statement of conformance for the article) is eligible for approval 
under this part unless the person seeking the approval is a 
manufacturer and applies under Sec.  21.603(a) for a separate TSO 
authorization. Persons other than a manufacturer may obtain approval 
for design changes under part 43 or under the applicable airworthiness 
regulations of this chapter.


Sec.  21.620  Changes in quality system.

    After the issuance of a TSO authorization--
    (a) Each change to the quality system is subject to review by the 
FAA; and
    (b) The holder of the TSO authorization must immediately notify the 
FAA, in writing, of any change that may affect the inspection, 
conformity, or airworthiness of its article.


Sec.  21.621  Issuance of letters of TSO design approval: import 
articles.

    (a) The FAA may issue a letter of TSO design approval for an 
article--
    (1) Designed and manufactured in a foreign country or jurisdiction 
subject to the export provisions of an agreement with the United States 
for the acceptance of these articles for import; and
    (2) For import into the United States if--
    (i) The State of Design certifies that the article has been 
examined, tested, and found to meet the applicable TSO

[[Page 53394]]

or the applicable performance standards of the State of Design and any 
other performance standards the FAA may prescribe to provide a level of 
safety equivalent to that provided by the TSO; and
    (ii) The manufacturer has provided to the FAA one copy of the 
technical data required in the applicable performance standard through 
its State of Design.
    (b) The FAA issues the letter of TSO design approval that lists any 
deviation granted under Sec.  21.618.

PART 43--MAINTENANCE, PREVENTIVE MAINTENANCE, REBUILDING, AND 
ALTERATION

0
49. The authority citation for part 43 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 44701, 44703, 44705, 44707, 
44711, 44713, 44717, 44725.


Sec.  43.2  [Amended]

0
50. Amend Sec.  43.2(a)(2) by removing the reference to ``Sec.  21.305 
of this chapter'' and adding in its place ``part 21 of this chapter''.

0
51. Revise Sec.  43.3(j)(3) to read as follows:


Sec.  43.3  Persons authorized to perform maintenance, preventive 
maintenance, rebuilding, and alterations.

* * * * *
    (j) * * *
    (3) Perform any inspection required by part 91 or part 125 of this 
chapter on aircraft it manufactured under a type certificate, or 
currently manufactures under a production certificate.

PART 45--IDENTIFICATION AND REGISTRATION MARKING

0
52. Revise the authority citation for part 45 to read as follows:

    Authority:  49 U.S.C. 106(g), 40103, 40113-40114, 44101-44105, 
44107-44111, 44504, 44701, 44708-44709, 44711-44713, 44725, 45302-
45303, 46104, 46304, 46306, 47122.

PART 45--[AMENDED]

0
53. Amend part 45 by:
0
a. Removing the word ``Administrator'' and the words ``Administrator of 
the FAA'' and adding in their place the word ``FAA'' wherever they 
appear; and
0
b. Removing the word ``shall'' and adding in its place the word 
``must'' wherever it appears.

0
54. Amend Sec.  45.1 by revising paragraphs (a) and (b) and removing 
paragraph (c) to read as follows:


Sec.  45.1  Applicability.

* * * * *
    (a) Marking products and articles manufactured under--
    (1) A type certificate;
    (2) A production approval as defined under part 21 of this chapter; 
and
    (3) The provisions of an agreement between the United States and 
another country or jurisdiction for the acceptance of products and 
articles; and
    (b) Nationality and registration marking of U.S. registered 
aircraft.

Subpart B--Marking of Products and Articles

0
55. Revise the heading of subpart B to read as set forth above.

0
56. Amend subpart B by adding Sec.  45.10 to read as follows:


Sec.  45.10  Marking.

    No person may mark a product or article in accordance with this 
subpart unless--
    (a) That person produced the product or article --
    (1) Under part 21, subpart F, G, K, or O of this chapter; or
    (2) For export to the United States under the provisions of an 
agreement between the United States and another country or jurisdiction 
for the acceptance of products and articles; and
    (b) That product or article conforms to its approved design, and is 
in a condition for safe operation; and, for a TSO article; that TSO 
article meets the applicable performance standards.

0
57. Revise Sec.  45.11 to read as follows:


Sec.  45.11  Marking of products.

    (a) Aircraft. A manufacturer of aircraft covered under Sec.  21.182 
of this chapter must mark each aircraft by attaching a fireproof 
identification plate that--
    (1) Includes the information specified in Sec.  45.13 using an 
approved method of fireproof marking;
    (2) Must be secured in such a manner that it will not likely be 
defaced or removed during normal service, or lost or destroyed in an 
accident; and
    (3) Except as provided in paragraphs (d) through (h) of this 
section, must be secured to the aircraft fuselage exterior so that it 
is legible to a person on the ground, and must be either adjacent to 
and aft of the rear-most entrance door or on the fuselage surface near 
the tail surfaces.
    (b) Aircraft engines. A manufacturer of an aircraft engine produced 
under a type certificate or production certificate must mark each 
engine by attaching a fireproof identification plate. Such plate--
    (1) Must include the information specified in Sec.  45.13 using an 
approved method of fireproof marking;
    (2) Must be affixed to the engine at an accessible location; and
    (3) Must be secured in such a manner that it will not likely be 
defaced or removed during normal service, or lost or destroyed in an 
accident.
    (c) Propellers and propeller blades and hubs. Each person who 
produces a propeller, propeller blade, or propeller hub under a type 
certificate or production certificate must mark each product or part 
using an approved fireproof method. The marking must--
    (1) Be placed on a non-critical surface;
    (2) Contain the information specified in Sec.  45.13;
    (3) Not likely be defaced or removed during normal service; and
    (4) Not likely be lost or destroyed in an accident.
    (d) Manned free balloons. A manufacturer of manned free balloons 
must mark each balloon by attaching the identification plate described 
in paragraph (a) of this section. The plate must be secured to the 
balloon envelope and must be located, if practicable, where it is 
legible to the operator when the balloon is inflated. In addition, the 
basket and heater assembly must be permanently and legibly marked with 
the manufacturer's name, part number (or equivalent), and serial number 
(or equivalent).
    (e) Aircraft manufactured before March 7, 1988. The owner or 
operator of an aircraft manufactured before March 7, 1988 must mark the 
aircraft by attaching the identification plate required by paragraph 
(a) of this section. The plate must be secured at an accessible 
exterior or interior location near an entrance, if the model 
designation and builder's serial number are also displayed on the 
exterior of the aircraft fuselage. The model designation and builder's 
serial number must be--
    (1) Legible to a person on the ground,
    (2) Located either adjacent to and aft of the rear-most entrance 
door or on the fuselage near the tail surfaces, and
    (3) Displayed in such a manner that they are not likely to be 
defaced or removed during normal service.
    (f) For powered parachutes and weight-shift-control aircraft, the 
identification plate required by paragraph (a) of this section must be 
secured to the exterior of the aircraft fuselage so that it is legible 
to a person on the ground.
    (g) The identification plate described in paragraph (a) of this 
section may be secured to the aircraft at an accessible location near 
an entrance for--
    (1) Aircraft produced for--
    (i) Operations under part 121 of this chapter,
    (ii) Commuter operations (as defined in Sec.  119.3 of this 
chapter), or

[[Page 53395]]

    (iii) Export.
    (2) Aircraft operating under part 121 of this chapter and under an 
FAA-approved continuous airworthiness maintenance program; or
    (3) Aircraft operating in commuter air carrier operations (as 
defined in Sec.  119.3 of this chapter) under an FAA-approved 
continuous airworthiness maintenance program.
    (h) Gliders. Paragraphs (a)(3) and (e) of this section do not apply 
to gliders.


Sec.  45.13  [Amended]

0
58. Amend Sec.  45.13 by removing the text ``and (b)'' from paragraph 
(a) introductory text and adding in their place the text ``through 
(c)'' and by removing the words ``of this part'' from paragraph (c).


Sec.  45.14  [Removed]

0
59. Remove Sec.  45.14.

0
60. Revise Sec.  45.15 to read as follows:


Sec.  45.15  Marking requirements for PMA articles, TSO articles, and 
Critical parts.

    (a) PMA articles. The manufacturer of a PMA article must 
permanently and legibly mark--
    (1) Each PMA article, with the PMA holder's name, trademark, 
symbol, or other FAA approved identification and part number; and
    (2) The letters ``FAA-PMA''.
    (b) TSO articles. The manufacturer of a TSO article must 
permanently and legibly mark --
    (1) Each TSO article with the TSO holder's name, trademark, symbol, 
or other FAA approved identification and part number; and
    (2) Each TSO article, unless otherwise specified in the applicable 
TSO, with the TSO number and letter of designation, all markings 
specifically required by the applicable TSO, and the serial number or 
the date of manufacture of the article or both.
    (c) Critical parts. Each person who manufactures a part for which a 
replacement time, inspection interval, or related procedure is 
specified in the Airworthiness Limitations section of a manufacturer's 
maintenance manual or Instructions for Continued Airworthiness must 
permanently and legibly mark that part with a serial number (or 
equivalent) unique to that part in addition to the other applicable 
requirements of this section.
    (d) If the FAA finds a part or article is too small or otherwise 
impractical to mark with any of the information required by this part, 
the manufacturer must attach that information to the part or its 
container.


Sec.  45.16  [Amended]

0
61. Amend Sec.  45.16 by removing the last sentence of the section.

    Issued in Washington, DC, on October 6, 2009.
J. Randolph Babbitt,
Administrator.
[FR Doc. E9-24821 Filed 10-15-09; 8:45 am]
BILLING CODE 4910-13-P