[Federal Register Volume 78, Number 14 (Tuesday, January 22, 2013)]
[Proposed Rules]
[Pages 4347-4349]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-01049]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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  Federal Register / Vol. 78, No. 14 / Tuesday, January 22, 2013 / 
Proposed Rules  

[[Page 4347]]



DEPARTMENT OF HOMELAND SECURITY

Office of the Secretary

6 CFR Part 5

[Docket No. DHS-2012-0035]


Privacy Act of 1974: Implementation of Exemptions; Department of 
Homeland Security; U.S. Customs and Border Protection; DHS/CBP-004-
Intellectual Property Rights e-Recordation and Search Systems, System 
of Records

AGENCY: Privacy Office, DHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department of Homeland Security is giving concurrent 
notice of a newly established system of records pursuant to the Privacy 
Act of 1974 for the ``Department of Homeland Security/U.S. Customs and 
Border Protection; DHS/CBP-004-Intellectual Property Rights e-
Recordation and Search Systems (IPRRSS), System of Records'' and this 
proposed rulemaking. In this proposed rulemaking, the Department 
proposes to exempt portions of the system of records from one or more 
provisions of the Privacy Act because of criminal, civil, and 
administrative enforcement requirements.

DATES: Comments must be received on or before February 21, 2013.

ADDRESSES: You may submit comments, identified by docket number DHS-
2012-0035, by one of the following methods:
     Federal e-Rulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Fax: 202-343-4010.
     Mail: Jonathan R. Cantor, Acting Chief Privacy Officer, 
Privacy Office, Department of Homeland Security, Washington, DC 20528.
    Instructions: All submissions received must include the agency name 
and docket number for this notice. All comments received will be posted 
without change to http://www.regulations.gov, including any personal 
information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: For general questions please contact: 
Laurence E. Castelli (202-325-0280), CBP Privacy Officer, Office of 
International Trade/Regulations and Rulings, U.S. Customs and Border 
Protection, Mint Annex, 799 9th Street NW., Washington, DC 20229-1177. 
For privacy issues please contact: Jonathan R. Cantor (202-343-1717), 
Acting Chief Privacy Officer, Privacy Office, Department of Homeland 
Security, Washington, DC 20528.

SUPPLEMENTARY INFORMATION:

I. Background

    In accordance with the Privacy Act of 1974, 5 U.S.C. 552a, the 
Department of Homeland Security (DHS), U.S. Customs and Border 
Protection (CBP) proposes to establish a new DHS system of records 
titled, ``DHS/CBP-004-Intellectual Property Rights e-Recordation and 
Search Systems System of Records.''
    The Intellectual Property Rights e-Recordation and Search Systems 
(IPRRSS) collect, use, and maintain records related to intellectual 
property rights recordations and their owners. The purpose of IPRRSS is 
to aid in the enforcement of intellectual property rights by making 
intellectual property recordations available to the public and to CBP 
officials.
    IPRRSS collectively encompasses three separate systems. The first 
system is the online Intellectual Property Rights e-Recordation (IPRR) 
system, which allows intellectual property owners to submit 
applications for trademark and copyright recordations. The IPRR system 
shares information with the public Intellectual Property Rights Search 
(IPRS) system and the CBP Intellectual Property Rights Internal Search 
(IPRiS) system. Because CBP may collect personally identifiable 
information (PII) about intellectual property rights holders, their 
agents, or their licensees in IPRR, IPRS, and IPRiS (collectively 
IPRRSS), CBP is providing the public notice about how CBP collects, 
uses, and maintains records related to intellectual property rights 
recordations.
    The authority for this system derives from Section 42 of the Lanham 
Act (Trademark Act of 1946), as amended, 15 U.S.C. 1124; Sections 101 
and 602 through 603 of the Copyright Act of 1976, as amended, 17 U.S.C. 
101, 602-603; and Sections 526, 595a, and 624 of the Tariff Act of 
1930, as amended, 19 U.S.C. 1526, 1595a, and 1624. The cited sections 
provide that intellectual property rights owners may submit information 
to CBP to enable CBP officials to identify infringing articles at the 
borders and prevent the importation of counterfeit or pirated 
merchandise. Owners seeking to have merchandise excluded from entry 
must provide proof to CBP of the validity of the intellectual property 
rights they seek to protect.
    Pursuant to the Independent Offices Appropriations Act of 1952, 31 
U.S.C. 9701, and regulations at 19 CFR 133.3, 133.13, and 133.33, 
intellectual property rights owners or their agents must pay a fee when 
they apply for the recordation with CBP of their trademark, trade name, 
or copyright. Through IPRR's web-based interface, the user will be 
prompted through several steps that capture the user's required 
application information. Once the applicant has entered all required 
application information, IPRR will guide the applicant through a series 
of prompts seeking his/her billing name, billing address, and credit 
card information. IPRR forwards this payment information to Pay.gov for 
payment processing, and the applicant name and an IPRR tracking number 
to the DHS/CBP-003 Credit/Debit Card Data System (CDCDS) System of 
Records for payment reconciliation. Pay.gov sends a nightly activity 
file, including the last four digits of the credit card, authorization 
number, billing name, billing address, IPRR tracking number, and 
Pay.gov tracking numbers to CDCDS. Pay.gov also sends a daily batch 
file with the necessary payment information to a commercial bank for 
settlement processing. After processing, the commercial bank sends a 
settlement file, including the full credit card number, authorization 
number, card type, transaction date, amount, and IPRR tracking number 
to CDCDS. Once IPRR receives confirmation from Pay.gov that the payment 
has been processed successfully, IPRR will retain the Pay.gov tracking 
number for payment

[[Page 4348]]

reconciliation purposes in accordance with the CDCDS system of records 
retention schedule.
    When an applicant enters the registration number of a copyright or 
trademark he or she would like to record with CBP, the IPRR system must 
receive a positive match response from the U.S. Patent and Trademark 
Office (USPTO) and U.S. Copyright Office Web sites in order for the 
application to proceed. Only the registration number is shared with the 
USPTO and U.S. Copyright Office Web sites. If the registration number 
entered in IPRR does not match an entry in either of these Web sites, 
the applicant cannot record their trademark or copyright with CBP. Once 
a positive match response is received from these systems, certain 
fields in the application are automatically populated with public data 
taken directly from the U.S. Copyright Office or USPTO Web sites. All 
of the information copied from the U.S. Copyright Office or USPTO Web 
sites is publicly available at www.uspto.gov and www.copyright.gov.
    The public may search for trademark, trade name, and copyright 
information in IPRS, the public facing portion of this system of 
records. The IPRS database collects and retains only a portion of the 
information entered by the right holder in IPRR, such as the name, 
address, and phone number of the right holder or representative, along 
with a text description of the recorded trademark or copyright. This 
information allows retailers, consumers, and other businesses to 
contact the right owner to ensure that they are not obtaining goods 
that infringe on the owner's intellectual property rights.
    CBP and U.S. Immigration and Customs Enforcement (ICE) officials 
have access to IPRiS to assist in the enforcement of intellectual 
property rights. IPRiS provides a central searchable database of all 
trademark, trade name, and copyright recordation information. IPRiS 
contains the same information as IPRS, but with additional fields 
containing confidential information submitted by the right holder, 
including the names of entities who have used the trademark or 
copyright, the country of manufacture of merchandise, images of the 
recorded trademark or copyright, lists of licensees, and any additional 
information relating to enforcement of the intellectual property right. 
Only CBP and ICE officials may search IPRiS.
    Only a few users within CBP have access to an administrative 
interface to process IPRR recordations. Those authorized CBP users with 
administrative access process the renewals of existing trademark and 
copyright recordations, trade name recordations, and information about 
ownership changes or cancellations.
    Consistent with DHS' information-sharing mission, information 
stored in the DHS/CBP-004-Intellectual Property Rights e-Recordation 
and Intellectual Property Rights Search Systems may be shared with 
other DHS components with a need to know the information. In addition, 
these records may be shared with appropriate federal, state, local, 
tribal, territorial, foreign, or international government agencies so 
long as the recipient has a need to know the information to carry out 
functions consistent with the routine uses set forth in the system of 
records notice (SORN).
    The Department of Homeland Security is issuing this Notice of 
Proposed rulemaking to exempt this system of records from certain 
provisions of the Privacy Act, concurrent with the system of records 
notice. DHS is not exempting any data in the system regarding an 
individual's application for recordation of his or her trademark, trade 
name, or copyright. This system, however, may contain records or 
information pertaining to the accounting of disclosures of records 
pertaining to persons or entities, who are alleged to have made an 
infringing use of a recorded intellectual property right, made from 
this system to other national security, law enforcement, or 
intelligence agencies (federal, state, local, foreign, international or 
tribal) in accordance with the published routine uses or statutory 
basis for disclosure under 5 U.S.C. 552a(b). For the accounting of 
these disclosures only, in accordance with 5 U.S.C. 552a (j)(2) and 
(k)(2), DHS will claim exemptions for these records or information.

II. Privacy Act

    The Privacy Act embodies fair information practice principles in a 
statutory framework governing the means by which the federal government 
collects, maintains, uses, and disseminates personally identifiable 
information. The Privacy Act applies to information that is maintained 
in a ``system of records.'' A ``system of records'' is a group of any 
records under the control of an agency from which information is 
retrieved by the name of the individual or by some identifying number, 
symbol, or other identifying particular assigned to the individual. In 
the Privacy Act, an individual is defined to encompass U.S. citizens 
and lawful permanent residents. As a matter of policy, DHS extends 
administrative Privacy Act protections to all persons, regardless of 
citizenship, where systems of records maintain information on U.S. 
citizens, lawful permanent residents, and visitors.
    The Privacy Act allows government agencies to exempt certain 
records from the access and amendment provisions. If an agency claims 
an exemption, however, it must issue a Notice of Proposed Rulemaking to 
make clear to the public the reasons why a particular exemption is 
claimed.
    DHS is claiming exemptions from certain requirements of the Privacy 
Act for DHS/CBP-004-Intellectual Property Rights e-Recordation and 
Intellectual Property Rights Search Systems System of Records. Some 
information in DHS/CBP-004-Intellectual Property Rights e-Recordation 
and Intellectual Property Rights Search Systems System of Records 
relates to official DHS national security, law enforcement or 
intelligence activities, and that information includes records or 
information pertaining to the accounting of disclosures made from this 
system to other law enforcement or intelligence agencies (federal, 
state, local, foreign, international, or tribal) in accordance with the 
published routine uses or statutory basis for disclosure pursuant to 5 
U.S.C. 552a(b). In addition, some information in DHS/CBP-004-
Intellectual Property Rights e-Recordation and Intellectual Property 
Rights Search Systems System of Records relates to information or 
records about individuals who may have used an intellectual property 
right without the intellectual property right owner's authorization. 
These exemptions are needed to protect information relating to DHS 
national security, law enforcement, or intelligence activities from 
disclosure to subjects or others related to these activities. 
Specifically, the exemptions are required to preclude subjects of these 
activities from frustrating these processes and to avoid disclosure of 
activity techniques. Disclosure of information to the subject of the 
inquiry could also permit the subject to avoid detection or 
apprehension.
    The exemptions proposed here are standard intelligence, law 
enforcement, and national security exemptions exercised by a large 
number of federal law enforcement and intelligence agencies. In 
appropriate circumstances, when compliance would not appear to 
interfere with or adversely affect the law enforcement purposes of this 
system and the overall law enforcement process, the applicable 
exemptions may be waived on a case by case basis.
    A notice of system of records for DHS/CBP-004-Intellectual Property 
Rights e-

[[Page 4349]]

Recordation and Search Systems System of Records is also published in 
this issue of the Federal Register.

List of Subjects in 6 CFR Part 5

    Freedom of information; Privacy.
    For the reasons stated in the preamble, DHS proposes to amend 
Chapter I of Title 6, Code of Federal Regulations, as follows:

PART 5--DISCLOSURE OF RECORDS AND INFORMATION

0
1. The authority citation for Part 5 continues to read as follows:

    Authority:  Pub. L. 107-296, 116 Stat. 2135; (6 U.S.C. 101 et 
seq.); 5 U.S.C. 301. Subpart A also issued under 5 U.S.C. 552. 
Subpart B also issued under 5 U.S.C. 552a.

0
2. Add at the end of Appendix C to Part 5, the following new paragraph 
``69'':

Appendix C to Part 5--DHS Systems of Records Exempt From the Privacy 
Act

* * * * *
    69. The DHS/CBP-004 Intellectual Property Rights e-Recordation 
and Search Systems System of Records consists of electronic and 
paper records and will be used by DHS and its components. The DHS/
CBP-004-Intellectual Property Rights e-Recordation and Search 
Systems System of Records is a repository of information held by DHS 
in connection with its several and varied missions and functions, 
including, but not limited to, the enforcement of civil and criminal 
laws; investigations, inquiries, and proceedings; national security; 
and intelligence activities. The DHS/CBP-004-Intellectual Property 
Rights e-Recordation and Search Systems System of Records contains 
information that is collected by, on behalf of, in support of, or in 
cooperation with DHS and its components and may contain personally 
identifiable information collected by other federal, state, local, 
tribal, territorial, foreign, or international government agencies. 
CBP will not assert any exemptions with respect to information in 
the systems submitted by the intellectual property right owner or 
the owner's representative. Information in the system pertaining to 
persons alleged to have infringed on an intellectual property right 
may be shared with national security, law enforcement, or 
intelligence agencies pursuant to the published routine uses. The 
Privacy Act requires DHS to maintain an accounting of the 
disclosures made pursuant to all routines uses. Disclosing the fact 
that national security, law enforcement or intelligence agencies 
have sought particular records may affect ongoing national security, 
law enforcement, or intelligence activity. As such, pursuant to 5 
U.S.C. 552a(j)(2), DHS will claim exemption from subsections (c)(3), 
(e)(8), and (g) of the Privacy Act of 1974, as amended, as necessary 
and appropriate to protect this information. In addition, because 
the system may contain information or records about the unauthorized 
use of intellectual property rights and disclosure of that 
information could impede law enforcement investigations, DHS will 
claim, pursuant to 5 U.S.C. 552a(k)(2), exemption from subsections 
(c)(3), (d), (e)(1), (e)(4)(G), (e)(4)(H), (e)(4)(I), and (f) of the 
Privacy Act of 1974, as necessary and appropriate to protect this 
information.
    Exemptions from these particular subsections are justified, on a 
case-by-case basis to be determined at the time a request is made, 
for the following reasons:
    (a) From subsection (c)(3) (Accounting for Disclosures) because 
release of the accounting of disclosures could alert the subject of 
an investigation of an actual or potential criminal, civil, or 
regulatory violation to the existence of that investigation and 
reveal investigative interest on the part of DHS as well as the 
recipient agency. Disclosure of the accounting would therefore 
present a serious impediment to law enforcement efforts and/or 
efforts to preserve national security. Disclosure of the accounting 
would also permit the individual who is the subject of a record to 
impede the investigation, to tamper with witnesses or evidence, and 
to avoid detection or apprehension, which would undermine the entire 
investigative process.
    (b) From subsection (d) (Access to Records) because access to 
the records contained in this system of records could inform the 
subject of an investigation of an actual or potential criminal, 
civil, or regulatory violation to the existence of that 
investigation and reveal investigative interest on the part of DHS 
or another agency. Access to the records could permit the individual 
who is the subject of a record to impede the investigation, to 
tamper with witnesses or evidence, and to avoid detection or 
apprehension. Amendment of the records could interfere with ongoing 
investigations and law enforcement activities and would impose an 
unreasonable administrative burden by requiring investigations to be 
continually reinvestigated. In addition, permitting access and 
amendment to such information could disclose security-sensitive 
information that could be detrimental to homeland security.
    (c) From subsection (e)(1) (Relevancy and Necessity of 
Information) because in the course of investigations into potential 
violations of federal law, the accuracy of information obtained or 
introduced occasionally may be unclear, or the information may not 
be strictly relevant or necessary to a specific investigation. In 
the interests of effective law enforcement, it is appropriate to 
retain all information that may aid in establishing patterns of 
unlawful activity.
    (d) From subsections (e)(4)(G), (e)(4)(H), and (e)(4)(I) (Agency 
Requirements) and (f) (Agency Rules), because portions of this 
system are exempt from the individual access provisions of 
subsection (d) for the reasons noted above, and therefore DHS is not 
required to establish requirements, rules, or procedures with 
respect to such access. Providing notice to individuals with respect 
to existence of records pertaining to them in the system of records 
or otherwise setting up procedures pursuant to which individuals may 
access and view records pertaining to themselves in the system would 
undermine investigative efforts and reveal the identities of 
witnesses, and potential witnesses, and confidential informants.
    (e) From subsection (e)(8) (Notice on Individuals) because 
compliance would interfere with DHS's ability to obtain, serve, and 
issue subpoenas, warrants, and other law enforcement mechanisms that 
may be filed under seal and could result in disclosure of 
investigative techniques, procedures, and evidence.
    (f) From subsection (g)(1) (Civil Remedies) to the extent that 
the system is exempt from other specific subsections of the Privacy 
Act.


Jonathan R. Cantor,
Acting Chief Privacy Officer, Department of Homeland Security.
[FR Doc. 2013-01049 Filed 1-18-13; 8:45 am]
BILLING CODE 9110-06-P