[Federal Register Volume 78, Number 60 (Thursday, March 28, 2013)]
[Proposed Rules]
[Pages 18947-18953]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-07161]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 648

[Docket No. 120416018-3159-01]
RIN 0648-BC05


Fisheries of the Northeastern United States; Tilefish Fishery 
Management Plan; Regulatory Amendment, Corrections, and Clarifications

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Proposed rule; request for comments.

-----------------------------------------------------------------------

SUMMARY: The Tilefish Individual Fishing Quota Program was implemented 
at the start of the 2010 fishing year (November 1, 2009). After 3 years 
of operation, it has become apparent that some of the implementing 
regulations need to be clarified, corrected, or modified to better 
reflect the intent of Tilefish Amendment 1 and clarify certain 
regulatory text that may cause confusion or otherwise appear 
inconsistent with the Magnuson-Stevens Fishery Conservation and 
Management Act (MSA). This action would make corrections, 
clarifications, and regulatory modifications to the regulations that 
implemented the Tilefish Individual Fishing Quota Program. These 
changes would not affect the fishing operation of any vessel.

DATES: Written comments must be received no later than 5 p.m. eastern 
standard time, on April 29, 2013.

ADDRESSES: You may submit comments on this document, identified by 
NOAA-NMFS-2012-0247, by any of the following methods:
     Electronic Submission: Submit all electronic public 
comments via the Federal e-Rulemaking Portal. Go to 
www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2012-0247, click the 
``Comment Now!'' icon,

[[Page 18948]]

complete the required fields, and enter or attach your comments.
     Mail: Submit written comments to John K. Bullard, Regional 
Administrator, NMFS, Northeast Regional Office, 55 Great Republic 
Drive, Gloucester, MA 01930. Mark the outside of the envelope: 
``Comments on Tilefish Correction Proposed Rule.''
     Fax: (978) 281-9135, Attn: Douglas Potts.
    Instructions: Comments sent by any other method, to any other 
address or individual, or received after the end of the comment period, 
may not be considered by NMFS. All comments received are a part of the 
public record and will generally be posted for public viewing on 
www.regulations.gov without change. All personal identifying 
information (e.g., name, address, etc.), confidential business 
information, or otherwise sensitive information submitted voluntarily 
by the sender will be publicly accessible. NMFS will accept anonymous 
comments (enter ``N/A'' in the required fields if you wish to remain 
anonymous). Attachments to electronic comments will be accepted in 
Microsoft Word, Excel, or Adobe PDF file formats only.

FOR FURTHER INFORMATION CONTACT: Douglas Potts, Fishery Policy Analyst, 
phone (978) 281-9341, fax (978) 281-9135.

SUPPLEMENTARY INFORMATION: 

Background

    On August 24, 2009, NMFS published a final rule (74 FR 42580) to 
implement provisions of Amendment 1 to the Tilefish Fishery Management 
Plan (FMP) (Tilefish Amendment 1). Tilefish Amendment 1 included a new 
structure for managing the commercial tilefish fishery using an 
individual fishing quota (IFQ) system. The new tilefish IFQ program 
became effective on November 1, 2009. After 3 years of operation, it 
has become apparent that some of the implementing regulations need to 
be clarified, corrected, or modified to better reflect the intent of 
Tilefish Amendment 1.
    In most IFQ programs, there is a clear distinction between quota 
share (QS) and quota pounds (QP). QS is the percentage of the total 
annual allocation of fish to the IFQ program that is held by an 
allocation holder from year to year (e.g., 2 percent of the total 
allocation). QP refers to the quota, expressed in weight of fish, that 
is issued annually to each IFQ allocation permit holder based on the QS 
they hold and the total amount of fish allocated to the IFQ program 
(e.g., 2-percent QS x 1,000,000 lb (453,592 kg) = 20,000 lb (9,072 kg) 
QP). The current regulations regarding the tilefish IFQ program use the 
term ``allocation'' to refer to both QS and QP in the tilefish IFQ 
fishery. In some instances, this lack of distinction can cause 
confusion, particularly when discussing transfers of QS and QP. For 
example, QP transfers are temporary (i.e., a lease), effective for the 
duration of the current fishing year, while QS transfers are permanent 
and affect the calculation of QP that would be allocated to an IFQ 
allocation permit holder in the following fishing year. Accordingly, an 
IFQ allocation permit holder could potentially conduct either or both 
types of transfer in a given year, not necessarily to the same 
individuals. In order to clarify the difference between QS and QP, this 
rule would adopt, throughout the tilefish IFQ regulations, the terms 
``IFQ quota share'' and ``annual IFQ allocation'' to refer to QS and 
QP, respectively, rather than using the term ``allocation'' to refer to 
both QS and QP.
    The use of the term ``allocation'' to refer to both QS and QP also 
resulted in the current regulations referring to ``permanent 
allocation'' and allocation ``ownership,'' as another way to 
distinguish QS from QP. These terms could be confusing to the reader, 
because the MSA specifically states that harvest authorizations under a 
limited access privilege program (such as the tilefish IFQ program) do 
not create any right, title, or interest to or in any fish prior to 
harvest and may be revoked, limited, or modified at any time (16 U.S.C. 
1853a(b)). Therefore, allocations are not permanent and are not 
``owned'' by the allocation holder. This rule would modify language 
throughout the regulation that might appear to be inconsistent with the 
MSA by removing references to IFQ allocation being ``owned'' or 
``permanent,'' and, where appropriate, would replace such references 
with references to these allocations being held by or allocated to 
tilefish IFQ allocation permit holders.
    Tilefish Amendment 1 specifies that U.S. citizens, permanent 
resident aliens, or corporations eligible to own a U.S. Coast Guard 
documented vessel are eligible to hold a tilefish IFQ allocation permit 
for both QS and QP. However, the current regulatory language regarding 
who can hold a tilefish IFQ allocation permit only makes reference to 
the section of the U.S. Code pertaining to ownership of a U.S. Coast 
Guard documented vessel. Because permanent resident aliens cannot own a 
U.S. Coast Guard documented vessel, their ability to hold a tilefish 
IFQ allocation permit is not addressed by the current regulations. 
Therefore, this action would consolidate the number of cross references 
to the relevant section of the U.S. Code into a single cross reference 
in a new subparagraph at Sec.  648.294(a)(3) and add language to 
specifically allow permanent resident aliens to hold a tilefish IFQ 
allocation permit. This action would also correct an error in the cross 
reference to the U.S. Code.
    The regulations require vessel owners or operators in the tilefish 
IFQ program to report landings of tilefish within 48 hours of landing, 
through the Interactive Voice Response (IVR) system. This action would 
specify in Sec.  648.7(b)(2)(ii) that such reports may be submitted 
through the IVR system, or through another system approved by the 
Regional Administrator. This would allow for the future development of 
an online reporting option that could be more convenient for the 
fishing industry and less prone to data entry errors.
    When the tilefish IFQ system was first implemented, a deadline of 
September 1 was set for all transfers of both QS (permanent transfer) 
and QP (temporary transfer) allocations. The September 1 deadline was 
intended to allow time for NMFS to process any permanent transfers of 
QS before QP allocations needed to be issued prior to the start of the 
next fishing year on November 1. This action proposes to maintain the 
September 1 deadline for submitting an application for a QS transfer, 
but would revise Sec.  648.294(e)(4) to allow a deadline of October 10 
for a QP transfer. This additional time would allow IFQ allocation 
permit holders who exceed their available QP by a small amount near the 
end of the fishing year to lease more QP to cover the potential overage 
and avoid a deduction in their QP allocation the following year. It 
would also allow IFQ allocation permit holders who have more QP than 
they intend to harvest to gain some value by leasing it out. This 
additional time for transferring annual QP could lead to fuller and 
more efficient utilization of the available QP.
    Section 304(d) of the MSA requires NMFS to recover the actual costs 
directly related to the management, data collection, and enforcement of 
any limited access privilege program. This action proposes regulatory 
changes to the process of determining and collecting IFQ cost recovery 
fees under the authority granted the Secretary in section 305(d) of the 
MSA. The Tilefish Amendment 1 document and the August 24, 2009, final 
rule were both written before the tilefish IFQ cost recovery fee year 
had been established and before the system for billing and collecting 
payments had been fully developed. Consequently, the

[[Page 18949]]

regulations do not fully reflect the current practices of the cost 
recovery system that developed after the initial stages of the IFQ cost 
recovery process. This action proposes regulatory changes to Sec.  
648.294(h) to reconcile the regulatory language with the intent of 
Tilefish Amendment 1 to ensure clear and efficient collection of the 
required cost-recovery fees, and the current cost recovery fee 
collection system. For example, the current regulations require the 
Regional Administrator to deny renewal of an IFQ allocation permit if 
the cost recovery fee is not paid by the initial due date. However, 
since the fee year that was established after the regulations were 
written does not align with the fishing year, permits are issued 3 
months before cost recovery bills are calculated, making denial of 
permit renewal a potentially ineffective deterrent against non-payment. 
Therefore, the proposed action would authorize the Regional 
Administrator to suspend an IFQ allocation permit, prohibiting landing 
or leasing QP or transferring QS, if full payment of the cost recovery 
fee is not made by the initial due date, rather than waiting until the 
next fishing year to deny the renewal of the IFQ allocation permit. 
Under the current regulations, a fisherman may submit additional 
documentation to support a different fee amount, but it is not clear 
when or how such documents must be submitted, or if this represents a 
formal appeal of the fee amount. NMFS has provided more information 
about how to appeal an IFQ cost recovery fee as part of the annual IFQ 
cost recovery fee bill that is sent to IFQ allocation permit holders. 
The proposed changes would clarify in the regulation that an IFQ 
allocation permit holder may appeal the fee amount, and, if an appeal 
is made, the permit holder may request a letter of authorization to 
allow continued fishing for tilefish while the appeal is pending. These 
changes would bring the regulatory text in line with the intent of 
Tilefish Amendment 1 to ensure clear and efficient collection of the 
required cost-recovery fees and the current cost recovery fee system as 
described in the cost recovery bills, and provide greater detail on the 
consequences of failing to pay or appeal the fee before the due date, 
as well as the process by which an IFQ allocation permit holder could 
appeal the cost recovery fee. In addition, the action would reorganize 
Sec.  648.294(h) to improve the section's clarity by using additional 
subparagraphs identified by headers to separate different aspects of 
the cost recovery fee collection process, including Payment 
Responsibility, IFQ Fee Determination, Fee Payment Procedure, Payment 
Compliance, Appeal of the IFQ Fee Amount, and Annual Cost Recovery 
Report.
    The action also would correct a regulatory cross reference 
pertaining to the Research Set-Aside program through revisions to 
648.292(e).

Classification

    Pursuant to section 304(b)(1)(A) of the MSA, the Assistant 
Administrator for Fisheries, NOAA, has determined that this proposed 
rule is consistent with the Tilefish FMP, other provisions of the MSA, 
and other applicable law, subject to further consideration after public 
comment.
    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866.
    The Chief Counsel for Regulation of the Department of Commerce 
certified to the Chief Counsel for Advocacy of the Small Business 
Administration (SBA) that this proposed rule, if adopted, would not 
have a significant economic impact on a substantial number of small 
entities.
    The factual basis for this certification is as follows:
    The proposed measures would only affect vessels holding an active 
Federal open-access tilefish permit and fishing under the tilefish IFQ 
program. In 2011, there were 12 Federal open-access tilefish vessels 
that were authorized to land tilefish under the tilefish IFQ program. 
All of these vessels fall within the SBA's definition of a small 
business, because none of the vessels exceeds the $4 million gross 
revenue threshold for commercial harvesters. No other small entities 
that would be expected to be directly affected by this proposed rule 
have been identified.
    The purpose of this action is to clarify, correct, and/or modify 
certain provisions of the tilefish IFQ program's implementing 
regulations to clarify potentially confusing regulatory language and to 
better reflect the intent of the Tilefish Amendment 1 and current 
practices under the tilefish IFQ program. Specifically, if implemented, 
this action would (1) clarify potentially confusing regulatory language 
regarding the difference between QS and QP or that such allocations are 
``owned'' or ``permanent;'' (2) specify in the regulations that 
tilefish landings may be reported through the IVR system, or through 
another system approved by the Regional Administrator, to allow for the 
future development of an online reporting option; (3) correct cross 
references within the regulations pertaining to the Research Set-Aside 
Program; (4) revise regulatory language and cross references in the 
regulations to clarify that permanent resident aliens are allowed to 
hold a tilefish IFQ allocation permit, as specified in Tilefish 
Amendment 1; (5) modify the regulations to extend the deadline for QP 
transfers from September 1 to October 10 of each fishing year; and (6) 
modify the regulations governing the cost recovery fee collection 
system to reflect current fee collection practices and the intent of 
Tilefish Amendment 1 to ensure clear and efficient collection of the 
required cost-recovery fees.
    Proposed changes (1) through (4) would make only minor, non-
substantive changes to the regulations to clarify confusing regulatory 
language, provide for potential alternative tilefish landing reporting 
methods, and correct cross references in the regulations. These 
proposed changes would not change the operating practices in the 
fishery or cause a net change to fishing effort, participation in the 
fishery, or increases in fishery expenses. Thus, these proposed changes 
are not expected to have a significant (if any) economic impact on the 
tilefish IFQ allocation permit holders.
    Proposed changes (5) and (6), which would make minor substantive 
changes to the regulations, are not expected to have a significant 
economic impact on the affected entities. The extended deadline for QP 
transfers until October 10 of each fishing year is not expected to 
significantly impact the amount of QP transferred nor the number of QP 
transfer requests. The intent of the modification is to allow IFQ 
allocation permit holders additional time to lease small amounts of QP 
to cover minor exceedances of their QP allocations prior to the 
beginning of the next fishing year on November 1. Likewise, the 
extended deadline for QP transfers would allow for similarly small 
gains in value by leasing surplus QP. For example, by the September 1 
deadline in fishing year 2012, 7 of the 12 tilefish IFQ allocation 
permit holders requested a total of 5 QP transfers, in which 13 percent 
of the total allowable landings were transferred (254,379 lbs of the 
total allowable landings of 1,895,250 lbs). While the additional time 
for QP transfers could result in more transfer requests, the amount of 
QP that IFQ allocation permit holders have requested to transfer by 
September 1 in the past would not be expected to increase significantly 
by extending the deadline to October 10. Accordingly, extending the QP 
transfer deadline is not expected to cause a significant net change to 
fishing effort, participation in the fishery, or increases in fishery

[[Page 18950]]

expenses, and therefore is expected to have a minor economic impact on 
the tilefish IFQ allocation permit holders.
    Similarly, the proposed changes to the cost recovery fee 
regulations in Sec.  648.294(h) are not expected to have a significant 
economic impact on the affected entities. The action's proposed changes 
would allow the Regional Administrator to suspend an IFQ allocation 
permit during the current fishing year for failure to pay the cost 
recovery fee, rather than not renewing the permit for the following 
fishing year. The proposed changes also would provide greater detail on 
the consequences of failing to pay or appeal the fee before the due 
date, as well as clarify the right of and process for appealing the 
cost recovery fee. Under the appeals process, an IFQ allocation permit 
holder may request a letter of authorization to allow continued fishing 
for tilefish while an appeal is pending. Therefore, because an IFQ 
allocation permit holder may appeal the cost recovery fee and request 
such a letter to continue fishing during that appeal, the proposed 
change is not expected to have a significant impact on the affected 
entities. Furthermore, during the time the Tilefish IFQ Program has 
been in existence, the cost recovery fees have been significantly less 
than the maximum 3 percent fee allowed under the MSA (the cost recovery 
fee percentages for 2010 and 2011 were 0.424 percent and 0.3836 
percent, respectively), and no IFQ allocation permit holder has failed 
to pay his/her cost recovery fee on time or appealed a fee amount. 
These proposed changes to the cost recovery fee regulations would 
reconcile the regulatory language with the intent of Tilefish Amendment 
1 to ensure clear and efficient collection of the required cost-
recovery fees, as well as with the current cost recovery fee collection 
system as communicated to IFQ allocation permit holders in the annual 
cost recovery bills. The action also would improve the clarity of Sec.  
648.294(h) by adding additional subparagraphs identified by headers to 
separate different aspects of the cost recovery fee collection system. 
All of these proposed changes to Sec.  648.294(h) would provide greater 
clarity to the affected entities of the cost recovery fee system, but 
are not expected to cause a net change to fishing effort, participation 
in the fishery, or increases in fishery expenses. Thus the proposed 
changes are not expected to result in a significant economic impact on 
the IFQ allocation permit holders.
    Therefore, because this action proposes to make minor corrections, 
clarifications, and modifications to the regulations, and because no 
significant net change in fishing effort, participation in the fishery, 
or fishery expenses is expected, this action will not have a 
significant economic effect on a substantial number of small entities. 
As a result, an initial regulatory flexibility analysis is not required 
and none has been prepared.
    This proposed rule does not establish any new reporting, record-
keeping, or other compliance requirements.

List of Subjects in 50 CFR Part 648

    Fisheries, Fishing, Reporting and recordkeeping requirements.

    Dated: March 22, 2013.
Alan D. Risenhoover,
Director, Office of Sustainable Fisheries, performing the functions and 
duties of the Deputy Assistant Administrator for Regulatory Programs, 
National Marine Fisheries Service.

    For the reasons set out in the preamble, 50 CFR part 648 is 
proposed to be amended as follows:

PART 648--FISHERIES OF THE NORTHEASTERN UNITED STATES

0
1. The authority citation for part 648 continues to read as follows:

    Authority: 16 U.S.C. 1801 et seq.

0
2. In Sec.  648.2, the definitions of ``Interest in an IFQ allocation'' 
and ``Lessee'' are revised to read as follows:


Sec.  648.2  Definitions.

* * * * *
    Interest in an IFQ allocation means: An allocation of quota share 
or annual IFQ allocation held by an individual; or by a company in 
which the individual is an owner, part owner, officer, shareholder, or 
partner; or by an immediate family member (an individual's parents, 
spouse, children, and siblings).
* * * * *
    Lessee means:
    (1) A vessel owner who receives temporarily transferred NE 
multispecies DAS from another vessel through the DAS Leasing Program 
specified at Sec.  648.82(k); or
    (2) A person or entity eligible to hold tilefish IFQ allocation, 
who receives temporarily transferred tilefish IFQ allocation, as 
specified at Sec.  648.294(e)(1).
* * * * *
0
3. In Sec.  648.7, paragraph (b)(2)(ii) is revised to read as follows:


Sec.  648.7  Recordkeeping and reporting requirements.

* * * * *
    (b) * * *
    (2) * * *
    (ii) Tilefish vessel owners or operators. The owner or operator of 
any vessel fishing under a tilefish IFQ allocation permit issued under 
this part, as described in Sec.  648.294(a), must submit a tilefish 
catch report by using the IVR system, or other reporting system 
approved by the Regional Administrator, within 48 hours after returning 
to port and offloading. The report shall include at least the following 
information, and any other information required by the Regional 
Administrator: Vessel identification; trip during which tilefish are 
caught; pounds landed; VTR pre-printed serial number; and the Federal 
dealer number for the dealer who purchases the tilefish. This reporting 
requirement does not exempt the owner or operator from other applicable 
reporting requirements of this section.
* * * * *
0
4. In Sec.  648.292, paragraph (e) is revised to read as follows:


Sec.  648.292  Tilefish specifications.

* * * * *
    (e) Research quota. See Sec.  648.22(g).
0
5. Section 648.294 is revised to read as follows:


Sec.  648.294  Individual fishing quota (IFQ) program.

    (a) IFQ allocation permits. (1) After adjustments for incidental 
catch, research set-asides, and overages, as appropriate, pursuant to 
Sec.  648.292(c), the Regional Administrator shall divide the remaining 
TAL among the IFQ quota share holders who held IFQ quota share as of 
September 1 of a given fishing year. Allocations shall be made by 
applying the IFQ quota share percentages that exist on September 1 of a 
given fishing year to the IFQ TAL pursuant to Sec.  648.292(c), subject 
to any deductions for overages pursuant to paragraph (f) of this 
section. Amounts of IFQ allocation of 0.5 lb (0.23 kg) or smaller 
created by this calculation shall be rounded downward to the nearest 
whole number, and amounts of IFQ allocation greater than 0.5 lb (0.23 
kg) shall be rounded upward to the nearest whole number, so that annual 
IFQ allocations are specified in whole pounds.
    (2) Allocations shall be issued in the form of an annual IFQ 
allocation permit. The IFQ allocation permit shall specify the quota 
share percentage held by the IFQ allocation permit holder and the total 
pounds of tilefish that the IFQ allocation permit holder is authorized 
to harvest.
    (3) In order to be eligible hold tilefish IFQ allocation, an 
individual must be a

[[Page 18951]]

U.S. citizen or permanent resident alien. Businesses or other entities 
that wish to hold allocation must be eligible to own a documented 
vessel under the terms of 46 U.S.C. 12103(b).
    (b) Application--(1) General. Applicants for a permit under this 
section must submit a completed application on an appropriate form 
obtained from NMFS. The application must be filled out completely and 
signed by the applicant. Each application must include a declaration of 
all interests in IFQ quota shares and IFQ allocations, as defined in 
Sec.  648.2, listed by IFQ allocation permit number, and must list all 
Federal vessel permit numbers for all vessels that an applicant owns or 
leases that would be authorized to possess tilefish pursuant to the IFQ 
allocation permit. The Regional Administrator will notify the applicant 
of any deficiency in the application.
    (i) [Reserved]
    (ii) Renewal applications. Applications to renew an IFQ allocation 
permit must be received by September 15 to be processed in time for the 
November 1 start of the next fishing year. Renewal applications 
received after this date may not be approved, and a new permit may not 
be issued before the start of the next fishing year. An IFQ allocation 
permit holder must renew his/her IFQ allocation permit on an annual 
basis by submitting an application for such permit prior to the end of 
the fishing year for which the permit is required. Failure to renew an 
IFQ allocation permit in any fishing year will result in any IFQ quota 
share held by that IFQ allocation permit holder to be considered 
abandoned and relinquished.
    (2) Issuance. Except as provided in subpart D of 15 CFR part 904, 
and provided an application for such permit is submitted by September 
15, as specified in paragraph (b)(1)(ii) of this section, NMFS shall 
issue annual IFQ allocation permits on or before October 31 to those 
who hold IFQ quota share as of September 1 of the current fishing year. 
From September 1 through October 31, permanent transfer of IFQ quota 
share is not permitted, as described in paragraph (e)(4) of this 
section.
    (3) Duration. An annual IFQ allocation permit is valid until 
October 31 of each fishing year unless it is suspended, modified, or 
revoked pursuant to 15 CFR part 904; revised due to a transfer of all 
or part of the IFQ quota share or annual IFQ allocation under paragraph 
(e) of this section; or suspended for non-payment of the cost recovery 
fee as described in paragraph (h)(4) of this section.
    (4) IFQ Vessel. All Federal vessel permit numbers that are listed 
on the IFQ allocation permit are authorized to possess tilefish 
pursuant to the IFQ allocation permit until the end of the fishing year 
or until NMFS receives written notification from the IFQ allocation 
permit holder that the vessel is no longer authorized to possess 
tilefish pursuant to the subject permit. An IFQ allocation permit 
holder who wishes to authorize an additional vessel(s) to possess 
tilefish pursuant to the IFQ allocation permit must send written 
notification to NMFS. This notification must include the vessel name 
and permit number, and the dates on which the IFQ allocation permit 
holder desires the vessel to be authorized to land tilefish pursuant to 
the IFQ allocation permit. A copy of the IFQ allocation permit must be 
carried on board each vessel so authorized to possess IFQ tilefish.
    (5) Alteration. An annual IFQ allocation permit that is altered, 
erased, or mutilated is invalid.
    (6) Replacement. The Regional Administrator may issue a replacement 
permit upon written application of the annual IFQ allocation permit 
holder.
    (7) Transfer. The annual IFQ allocation permit is valid only for 
the person to whom it is issued. All or part of the IFQ quota share or 
the annual IFQ allocation specified in the IFQ allocation permit may be 
transferred in accordance with paragraph (e) of this section.
    (8) Abandonment or voluntary relinquishment. Any IFQ allocation 
permit that is voluntarily relinquished to the Regional Administrator, 
or deemed to have been voluntarily relinquished for failure to pay a 
recoverable cost fee, in accordance with the requirements specified in 
paragraph (h)(2) of this section, or for failure to renew in accordance 
with paragraph (b)(1)(ii) of this section, shall not be reissued or 
renewed in a subsequent year.
    (c)-(d) [Reserved]
    (e) Transferring IFQ allocations--(1) Temporary transfers. Unless 
otherwise restricted by the provisions in paragraph (e)(3) of this 
section, the initial holder of an annual IFQ allocation may transfer 
the entire annual IFQ allocation, or a portion of the annual IFQ 
allocation, to any person or entity eligible to hold tilefish IFQ 
allocation under paragraph (a)(3) of this section. Annual IFQ 
allocation transfers shall be effective only for the fishing year in 
which the transfer is requested and processed, unless the applicant 
specifically requests that the transfer be processed for the subsequent 
fishing year. The Regional Administrator has final approval authority 
for all annual IFQ allocation transfer requests. The approval of a 
temporary transfer may be rescinded if the Regional Administrator finds 
that an emergency has rendered the lessee unable to fish for the 
transferred annual IFQ allocation, but only if none of the transferred 
allocation has been landed.
    (2) Permanent transfers. Unless otherwise restricted by the 
provisions in paragraph (e)(3) of this section, and subject to final 
approval by the Regional Administrator, a holder of IFQ quota share may 
permanently transfer the entire IFQ quota share allocation, or a 
portion of the IFQ quota share allocation, to any person or entity 
eligible to hold tilefish IFQ allocation under paragraph (a)(3) of this 
section.
    (3) IFQ allocation transfer restrictions. (i) If annual IFQ 
allocation is temporarily transferred to any eligible person or entity, 
it may not be transferred again within the same fishing year, unless 
the transfer is rescinded due to an emergency, as described in 
paragraph (e)(1) of this section.
    (ii) A transfer of IFQ allocation or quota share will not be 
approved by the Regional Administrator if it would result in an entity 
holding, or having an interest in, a percentage of IFQ allocation 
exceeding 49 percent of the total tilefish adjusted TAL.
    (iii) For the purpose of calculating the appropriate IFQ cost 
recovery fee, if the holder of an IFQ allocation leases additional IFQ 
allocation, the quantity and value of landings made after the date the 
lease is approved by the Regional Administrator are attributed to the 
transferred quota before being attributed to the allocation holder's 
base IFQ allocation, if any exists. In the event of multiple leases, 
landings would be attributed to the leased allocations in the order the 
leases were approved by the Regional Administrator. As described in 
paragraph (h) of this section, a tilefish IFQ quota share allocation 
holder shall incur a cost recovery fee, based on the value of landings 
of tilefish authorized under the allocation holder's annual tilefish 
IFQ allocation, including allocation that is leased to another IFQ 
allocation permit holder.
    (4) Application for an IFQ allocation transfer. Any IFQ allocation 
permit holder applying for either permanent transfer of IFQ quota share 
or temporary transfer of annual IFQ allocation must submit a completed 
IFQ Allocation Transfer Form, available from NMFS. The IFQ Allocation 
Transfer Form must be submitted to the NMFS Northeast

[[Page 18952]]

Regional Office at least 30 days before the date on which the applicant 
desires to have the IFQ allocation transfer effective. The Regional 
Administrator shall notify the applicants of any deficiency in the 
application pursuant to this section. Applications for permanent IFQ 
quota share allocation transfers must be received by September 1 to be 
processed for the current fishing year. Applications for annual IFQ 
allocation transfers must be received by October 10 to be processed for 
the current fishing year.
    (i) Application information requirements. An application to 
transfer IFQ allocation must include the following information: The 
type of transfer (either temporary or permanent); the signature of both 
parties involved; the price paid for the transfer; a declaration of the 
recipient's eligibility to receive IFQ allocation; the amount of 
allocation or quota share to be transferred; and a declaration, by IFQ 
allocation permit number, of all the IFQ allocations in which the 
person or entity receiving the IFQ allocation has an interest. The 
person or entity receiving the IFQ allocation must indicate the permit 
numbers of all federally permitted vessels that will possess or land 
the IFQ allocation. Information obtained from the IFQ Allocation 
Transfer Form is confidential pursuant to 16 U.S.C. 1881a.
    (ii) Approval of IFQ transfer applications. Unless an application 
to transfer IFQ catch share and/or IFQ allocation is denied according 
to paragraph (e)(4)(iii) of this section, the Regional Administrator 
shall issue confirmation of application approval in the form of a new 
or updated IFQ allocation permit to the parties involved in the 
transfer within 30 days of receipt of a completed application.
    (iii) Denial of transfer application. The Regional Administrator 
may reject an application to transfer IFQ catch share or IFQ allocation 
for the following reasons: The application is incomplete; the 
transferor does not possess a valid tilefish IFQ allocation permit; the 
transferor's or transferee's vessel or tilefish IFQ allocation permit 
has been sanctioned, pursuant to an enforcement proceeding under 15 CFR 
part 904; the transfer would result in the transferee having a tilefish 
IFQ allocation or holding IFQ quota share that exceeds 49 percent of 
the adjusted TAL allocated to IFQ allocation permit holders; the 
transfer is to a person or entity that is not eligible to hold tilefish 
IFQ allocation under paragraph (a)(3) of this section; the transferor 
or transferee is delinquent in payment of an IFQ cost recovery fee as 
described in paragraph (h)(4) of this section; or any other failure to 
meet the requirements of this subpart. Upon denial of an application to 
transfer IFQ allocation, the Regional Administrator shall send a letter 
to the applicant describing the reason(s) for the denial. The decision 
by the Regional Administrator is the final decision of the Department 
of Commerce; there is no opportunity for an administrative appeal.
    (f) IFQ allocation overages. If an IFQ allocation is exceeded, 
including by amounts of tilefish landed by a lessee in excess of a 
temporary transfer of IFQ allocation, the amount of the overage will be 
deducted from the IFQ shareholder's allocation in the subsequent 
fishing year(s). If an IFQ allocation overage is not deducted from the 
appropriate allocation before the IFQ allocation permit is issued for 
the subsequent fishing year, a revised IFQ allocation permit reflecting 
the deduction of the overage shall be issued by NMFS. If the allocation 
cannot be reduced in the subsequent fishing year because the full 
allocation has already been landed or transferred, the IFQ allocation 
permit will indicate a reduced allocation for the amount of the overage 
in the next fishing year.
    (g) IFQ allocation acquisition restriction. No person or entity may 
acquire more than 49 percent of the annual adjusted tilefish TAL, 
specified pursuant to Sec.  648.294, at any point during a fishing 
year. For purposes of this paragraph, acquisition includes any 
permanent transfer of IFQ quota share or temporary transfer of annual 
IFQ allocation. The calculation of IFQ allocation for purposes of the 
restriction on acquisition includes IFQ allocation interests held by: A 
company in which the IFQ holder is a shareholder, officer, or partner; 
an immediate family member; or a company in which the IFQ holder is a 
part owner or partner.
    (h) IFQ cost recovery. As required under section 304(d)(2)(A)(i) of 
the Magnuson-Stevens Act, the Regional Administrator shall collect a 
fee to recover the actual costs directly related to the management, 
data collection and analysis, and enforcement of the tilefish IFQ 
program.
    (1) Payment responsibility. Each tilefish IFQ allocation permit 
holder with quota share shall incur a cost recovery fee annually, based 
on the value of landings of tilefish authorized under his/her tilefish 
IFQ allocation, including allocation that he/she leases to another IFQ 
allocation permit holder. The tilefish IFQ allocation permit holder is 
responsible for paying the fee assessed by NMFS.
    (2) IFQ fee determination. The tilefish IFQ cost recovery billing 
period runs annually from January 1 through December 31.
    (i) Determination of total recoverable costs. The Regional 
Administrator shall determine the actual costs directly associated with 
the management, data collection and analysis, and enforcement of the 
tilefish IFQ program incurred by NMFS during the cost recovery billing 
period.
    (ii) Calculating fee percentage. The recoverable costs determined 
by the Regional Administrator will be divided by the total ex-vessel 
value of all tilefish IFQ landings during the cost recovery billing 
period to derive a fee percentage. Each IFQ allocation permit holder 
with quota share will be assessed a fee based on the fee percentage 
multiplied by the total ex-vessel value of all landings under his/her 
IFQ allocation permit, including landings of allocation that was leased 
to another IFQ allocation permit holder.
    (A) The ex-vessel value for each pound of tilefish landed by an IFQ 
allocation permit holder shall be determined from Northeast Federal 
dealer reports submitted to NMFS, which include the price per pound 
paid to the vessel at the time of dealer purchase.
    (B) The cost recovery fee percentage shall not exceed 3 percent of 
the total value of tilefish landings, as required under section 
304(d)(2)(B) of the Magnuson-Stevens Act.
    (3) Fee payment procedure. NMFS will create an annual IFQ 
allocation bill for each cost recovery billing period and provide it to 
IFQ allocation permit holder with quota share. The bill will include 
information regarding the amount and value of IFQ allocation landed 
during the prior cost recovery billing period, and the associated cost 
recovery fees.
    (i) Payment due date. An IFQ allocation permit holder who has 
incurred a cost recovery fee must pay the fee to NMFS within 45 days of 
the date of the bill.
    (ii) Payment submission method. Cost recovery payments shall be 
made electronically via the Federal Web portal, www.pay.gov, or other 
Internet sites designated by the Regional Administrator. Instructions 
for electronic payment shall be available on both the payment Web site 
and the cost recovery fee bill. Electronic payment options shall 
include payment via a credit card, as specified in the cost recovery 
bill, or via direct automated clearing house (ACH) withdrawal from a 
designated checking account. Alternatively, payment by check may be

[[Page 18953]]

authorized by Regional Administrator if he/she determines that 
electronic payment is not practicable.
    (4) Payment compliance. If an IFQ allocation permit holder does not 
submit full payment by the due date described in paragraph (h)(3)(i) of 
this section, the Regional Administrator may:
    (i) At any time thereafter, notify the IFQ allocation permit holder 
in writing that his/her IFQ allocation permit is suspended, thereby 
prohibiting landings of tilefish above the incidental limit, as 
specified at Sec.  648.295.
    (ii) Disapprove any transfer of annual tilefish allocation or quota 
share to or from the IFQ allocation permit holder as described in 
paragraph (e)(4)(iii) of this section, until such time as the amount 
due is paid.
    (iii) Deny renewal of the IFQ allocation permit if it had not yet 
been issued for the current year, or deny renewal of the IFQ allocation 
permit for the following year.
    (iv) If the fee amount is not appealed, the Regional Administrator 
may issue a Final Administrative Determination (FAD) as described in 
paragraph (h)(5) of this section, based upon available information.
    (5) Appeal of IFQ fee amount. If a tilefish IFQ allocation permit 
holder disagrees with the fee amount determined by NMFS, he/she may 
appeal the cost recovery bill.
    (i) IFQ fee appeals must be submitted to NMFS in writing before the 
due date described in paragraph (h)(3)(i) of this section.
    (ii) The IFQ allocation permit holder shall have the burden of 
demonstrating that the fee amount calculated by NMFS is incorrect and 
what the correct amount is.
    (iii) If a request to appeal is submitted on time, the Regional 
Administrator shall notify the IFQ allocation permit holder in writing, 
acknowledging the appeal and providing 30 days to submit any additional 
relevant documentation supporting an alternative fee amount.
    (iv) While the IFQ fee is under appeal and the tilefish IFQ 
allocation permit is suspended, as described in paragraph (h)(4) of 
this section, the IFQ allocation permit holder may request a Letter of 
Authorization to fish until the appeal is concluded. Any tilefish 
landed pursuant to the above authorization will count against the IFQ 
allocation permit, if issued.
    (v) Final Administrative Determination (FAD). Based on a review of 
available information, including any documentation submitted by the IFQ 
allocation permit holder in support of the appropriateness of a 
different fee amount, the Regional Administrator shall determine 
whether there is a reasonable basis upon which to conclude that an 
alternate fee amount is correct. This determination shall be in set 
forth in a FAD that is signed by the Regional Administrator. A FAD 
shall be the final decision of the Department of Commerce.
    (A) The IFQ allocation permit holder shall have 30 days from the 
date of the FAD to comply with the terms of the FAD.
    (B) If the IFQ allocation permit holder does not comply with the 
terms of the FAD within this period, the Regional Administrator shall:
    (1) Refer the matter to the appropriate authorities within the U.S. 
Department of the Treasury for purposes of collection; and
    (2) Cancel any Letter of Authorization to fish that had been issued 
during the appeal.
    (vi) If NMFS does not receive full payment of an IFQ cost recovery 
fee prior to the end of the cost recovery billing period immediately 
following the one for which the fee was incurred, the subject IFQ 
allocation permit and any associated IFQ quota share shall be deemed to 
have been voluntarily relinquished pursuant to paragraph (b)(8) of this 
section.
    (6) Annual cost recovery report. NMFS will publish annually a 
report on the status of the tilefish IFQ cost recovery program. The 
report will provide details of the costs incurred by NMFS for the 
management, enforcement, and data collection and analysis associated 
with the tilefish IFQ program during the prior cost recovery billing 
period, and other relevant information at the discretion of the 
Regional Administrator.
    (i) Periodic review of the IFQ program. A formal review of the IFQ 
program must be conducted by the MAFMC within 5 years of the effective 
date of the final regulations. Thereafter, it shall be incorporated 
into every scheduled MAFMC review of the FMP (i.e., future amendments 
or frameworks), but no less frequently than every 7 years.

[FR Doc. 2013-07161 Filed 3-27-13; 8:45 am]
BILLING CODE 3510-22-P