The regulations in “Subpart-Fruits and Vegetables” (7 CFR 319.56-1 through 319.56-70, referred to below as the regulations) prohibit or restrict the importation of fruits and vegetables into the United States from certain parts of the world to prevent the introduction and dissemination of plant pests that are new to or not widely distributed within the United States.

On April 15, 2014, we published in the Federal Register (79 FR 21153-21156, Docket No. APHIS-2013-0018) a proposal  1 to amend the regulations to allow the importation of mangoes from Jamaica into the continental United States. We prepared a pest risk assessment (PRA), titled “Importation of Mango Fruit, Mangifera indica, from Jamaica into the Continental United States” (March 2013). The PRA evaluated the risks associated with the importation of mangoes into the continental United States from Jamaica. Based on the information contained in the PRA, we determined that measures beyond standard port-of-entry inspection are required to mitigate the risks posed by the quarantine pests. To recommend specific measures to mitigate those risks, we prepared a risk management document (RMD).

Based on the RMD, we proposed to require the mangoes to be produced under a systems approach employing a combination of mitigation measures for five quarantine pests ( Anastrepha obliqua, Anastrepha suspensa, Coccus moestus, Phomopsis mangiferae, and Xanthomonas campestris pv. mangiferaeindicae ) and inspected prior to exportation from Jamaica and found free of those pests. We proposed to require the mangoes to be imported in commercial consignments only and to be treated in accordance with 7 CFR part 305 to mitigate the risk of Anastrepha spp. fruit fly. We also proposed to require the mangoes to be accompanied by a phytosanitary certificate with an additional declaration.

We solicited comments concerning the proposed rule for 60 days ending June 16, 2014. We received four comments by that date, all from private citizens. Three of the comments we received were in support of the proposed rule; however, one commenter raised several concerns that are addressed below.

The commenter stated that the mitigation measures seemed adequate for detecting pests on the surface of the mangoes but that stricter measures would need to be in place to detect eggs and larvae inside the fruit. The commenter suggested that we consider additional safeguards to detect internal pests, particularly to mitigate the risk of fruit flies.

As stated earlier, the systems approach requires that mangoes be treated in accordance with 7 CFR part 305. Specifically, mangoes are treated with either a hot water dip treatment or by irradiation using 150 Gy as the minimum absorbed dose. These mitigation options have proven to be effective against all stages of the fruit flies including eggs and larvae.

The commenter questioned whether or not inspection of mangoes alone is enough to detect P. mangiferae and X. campestris pv. Mangiferaeindicae.

P. mangiferae and X. campestris pv. Mangiferaeindicae are surface pathogens with the former penetrating no deeper than 10-20 mm from the surface. Both cause symptoms that are easily discernable, making inspections an effective tool to detect them. However, as an additional precaution, we are requiring that unless the mangoes originate from orchards that are inspected and found free of the pathogens, they must be subjected to either a pre-harvest or post-harvest application of a fungicide. These measures are consistent with those currently used to import mangoes from other countries; therefore, we are confident they are adequate to reduce the risks associated with the importation of mangoes from Jamaica.

The commenter asked why the importation of mangoes from Jamaica was necessary when the amount of mangoes estimated to be imported is low (less than 0.08 percent of U.S. mango imports).

This action is the result of a market access request made by Jamaica in 2009. It is our responsibility to consider these requests and analyze the potential pest risks associated with the commodity. If our findings suggest that the pest risks can be effectively mitigated then we will proceed with the rulemaking process to grant the requesting country's request.

Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule, without change.

This final rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget.

In accordance with the Regulatory Flexibility Act, we have analyzed the potential economic effects of this action on small entities. The analysis is summarized below. Copies of the full analysis are available on the Regulations.gov Web site (see footnote 1 in this document for a link to Regulations.gov) or by contacting the person listed under FOR FURTHER INFORMATION CONTACT .

This final rule is in response to a request from Jamaica to be allowed to export fresh mangoes to the continental United States. The annual quantity that Jamaica expects to export to the United States, 261 metric tons, represents less than 0.08 percent of U.S. mango imports (349,692 metric tons in 2012, primarily from Mexico, Peru, Ecuador, Brazil, and Guatemala). While mangoes are grown in Florida and Hawaii, and in smaller quantities in California and Texas, U.S. annual production totals only about 3,000 metric tons.

Most if not all U.S. mango farms and wholesalers are small entities. However, given the small quantity expected to be imported from Jamaica relative to current imports, the rule will not have a significant impact on U.S. mango producers. Moreover, the Jamaican mango season, March to July, only partially overlaps with that of the United States (Florida's season is May to September). U.S. importers may benefit marginally in having Jamaica as another source of fresh mangoes.

There are no recordkeeping or other compliance costs associated with the rule for U.S. entities, other than the import documentation normally required.

Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.

This final rule allows mangoes to be imported into the continental United States from Jamaica. State and local laws and regulations regarding mangoes imported under this rule will be preempted while the fruit is in foreign commerce. Fresh fruits are generally imported for immediate distribution and sale to the consuming public, and remain in foreign commerce until sold to the ultimate consumer. The question of when foreign commerce ceases in other cases must be addressed on a case-by-case basis. No retroactive effect will be given to this rule, and this rule will not require administrative proceedings before parties may file suit in court challenging this rule.

In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ), the information collection or recordkeeping requirements included in this final rule, which were filed under 0579-0419, have been submitted for approval to the Office of Management and Budget (OMB). When OMB notifies us of its decision, if approval is denied, we will publish a document in the Federal Register providing notice of what action we plan to take.

The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851-2908.

Accordingly, we are amending 7 CFR part 319 as follows:

Various RD automated accounting systems are designed to process obligations for Business, Community Facility, and Water and Environmental direct loan, guaranteed loan, and grant programs using a 6-day reservation period. The 6-day reservation period is a system edit in the PLAS, GLS, and CLSS that assigns an obligation date to an RD funded project 6 working days from the date funds are reserved.

When RD programs are funded through a continuing resolution, the accounting systems must be modified to waive the 6-day reservation edit. In Fiscal Year 2011, RD received six continuing resolutions followed by four continuing resolutions in Fiscal Year 2012 which resulted in cumbersome systems' modifications. These modifications have caused undue hardship to RD staff due to last minute continuing resolution decisions, manual system adjustments needed, and time consuming coordination efforts.

Several new RD programs have not implemented a 6-day reservation period for obligations. Under the American Recovery and Reinvestment Act of 2009 (ARRA) the Business and Industry (B&I) Guaranteed Loan Program disabled the 6 day reservation period along with the Biorefinery Assistance Program of the 2008 Farm Bill. Additionally, Rural Electric and Telecommunication, Single Family Housing, and Multi-Family Housing loans do not have a 6-day reservation requirement when obligating program funds.

To maintain consistency and uniformity across RD's automated accounting systems, RD will be removing the 6-day reservation system edit on obligations. As automation for this enhancement is completed, program staffs will have immediate knowledge of approved obligations as opposed to showing the obligations on reserved status. Field office personnel will adhere to a 6-working day waiting period prior to notifying an applicant/lender of loan and/or grant approval. Rural Development believes the removal of the 6-day reservation period on obligations for guaranteed loans, direct loans, and grants to be a noncontroversial change to the regulations with no impact on the public.

The programs described by this rule are listed in the Catalog of Federal Domestic Assistance Programs under number(s) 10.350 Technical Assistance to Cooperatives, 10.352 Value-Added Producer Grants, 10.420 Rural Self-Help Housing Technical Assistance, 10.433 Rural Housing Preservation Grants, 10.446 Rural Community Development Initiative, 10.759 Part 1774 Special Evaluation Assistance for Rural Communities and Household Program (SEARCH), 10.760 Water and Waste Disposal Systems for Rural Communities, 10.761 Technical Assistance and Training Grants, 10.762 Solid Waste Management Grants, 10.763 Emergency Community Water Assistance Grants, 10.766 Community Facilities Loans and Grants, 10.767 Intermediary Relending Program, 10.768 Business and Industry Loans, 10.769 Rural Business Enterprise Grants, 10.770 Water and Waste Disposal Loans and Grants (section 306C), 10.771 Rural Cooperative Development Grants, 10.773 Rural Business Opportunity Grants, 10.778 Research on the Economic Impact of Cooperatives, 10.781 Water and Waste Disposal Systems for Rural Communities—ARRA, 10.854 Rural Economic Development Loans and Grants, 10.856 1890 Land Grant Institutions Rural Entrepreneurial Outreach Program, 10.858 Denali Commission Grants and Loans, 10.862 Household Water Well System Grant Program, 10.864 Grant Program to Establish a Fund for Financing Water and Wastewater Projects, 10.866 Repowering Assistance, 10.868 Rural Energy for America Program, 10.870 Rural Micro entrepreneur Assistance Program.

This rule has been determined to be not significant for purposes of Executive Order 12866 and therefore has not been reviewed by the Office of Management and Budget (OMB).

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because of all or part of an individual's income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD).

If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, found online at http://www.ascr.usda.gov/complaint_filing_cust.html, or at any USDA office, or call (866) 632-9992 to request the form. You may also write a letter containing all of the information requested in the form. Send your completed complaint form or letter to us by mail at U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence Avenue SW., Washington, DC 20250-9410, by fax (202) 690-7442 or email at program.intake@usda.gov. Individuals who are deaf, hard of hearing or have speech disabilities and you wish to file a program complaint please contact USDA through the Federal Relay Service at (800) 877-8339 or (800) 845-6136 (in Spanish). USDA is an equal opportunity provider and employer.

No major civil rights impact is likely to result from the announcement of this notice. It will not have a negative civil rights impact on very-low income, low income, and moderate income and minority populations.

This document has been reviewed in accordance with 7 CFR part 1940, subpart G, “Environmental Program.” Rural Development has determined that this action does not constitute a major Federal action significantly affecting the quality of the human environment and, in accordance with the National Environmental Policy Act (NEPA) of 1969, 42 U.S.C. 4321 et seq., an Environmental Impact Statement is not required.

This program is not subject to the requirements of Executive Order 12372, “Intergovernmental Review of Federal Programs,” as implemented under USDA's regulations at 7 CFR part 3015.

This direct final rule has been reviewed under Executive Order 12988, Civil Justice Reform. In accordance with this rule: (1) All State and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given this rule; and (3) administrative proceedings in accordance with the regulations of the Department of Agriculture's National Appeals Division (7 CFR part 11) must be exhausted before bringing suit in court challenging action taken under this rule unless those regulations specifically allow bringing suit at an earlier time.

The policies contained in this direct final rule do not have any substantial direct effect on 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. Nor does this rule impose substantial direct compliance costs on State and local governments. Therefore, consultation with states is not required.

The Regulatory Flexibility Act (5 U.S.C. 601-602) (RFA) generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act (“APA”) or any other statute. This rule, however, is not subject to the APA under 5 U.S.C 553(a)(2) and 5 U.S.C. 553(b)(3)(A) nor any other statute.

Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L. 104-4) requires Federal agencies to assess the effects of their regulatory actions on State, local, or Tribal governments or the private sector. Agencies generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with Federal mandates that may result in expenditures of $100 million or more in any 1 year for State, local, or Tribal governments, in the aggregate, or to the private sector. UMRA generally requires agencies to consider alternatives and adopt the more cost effective or least burdensome alternative that achieves the objectives of the rule.

This direct final rule contains no Federal mandates (under the regulatory provisions of Title II of the Unfunded Mandates Reform Act of 1995) for State, local, and tribal Governments or the private sector. Therefore, this rule is not subject to the requirements of sections 202 and 205 of the Unfunded Mandates Reform Act of 1995.

This executive order imposes requirements on Rural Development in the development of regulatory policies that have tribal implications or preempt tribal laws. Rural Development has determined that the final rule does not have a substantial direct effect on one or more Indian tribe(s) or on either the relationship or the distribution of powers and responsibilities between the Federal Government and Indian tribes. Thus, this final rule is not subject to the requirements of Executive Order 13175. If a tribe determines that this rule has implications of which Rural Development is not aware and would like to engage with Rural Development on this rule, please contact Rural Development's Native American Coordinator at AIAN@wdc.usda.gov .

This rule does not contain any information collection requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

Rural Development is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

For the reasons set forth in the preamble, chapter XVIII, title 7, of the Code of Federal Regulations is amended as follows:

The Animal and Plant Health Inspection Service (APHIS) administers and enforces the Virus-Serum-Toxin Act (21 U.S.C. 151 et seq. ). Under the Virus-Serum-Toxin Act, a veterinary biological product must be shown to be pure, safe, potent, and efficacious before a veterinary biological product license may be issued. The regulations in 9 CFR part 113, “Standard Requirements” (referred to below as the regulations), prohibit the release of biological products prior to the completion of tests identified in the regulations and in the Outline of Production, a document submitted by the licensee that explains how a serial of product is formulated, tested, packaged, dated, and recommended for use.

On May 30, 2014, we published in the Federal Register (79 FR 31054-31056, Docket No. APHIS-2013-0034) a proposal  1 to amend the regulations by defining the terms used for reporting the results of tests performed on veterinary biological products. We proposed to add definitions of the terms used to designate test results, “satisfactory,” “unsatisfactory,” and “inconclusive,” to § 101.5(l) and to revise the definition of “No Test” currently in that section in order to align the regulations in 9 CFR part 113 with current industry standards and practices. We also proposed to remove §§ 113.201, 113.202, 113.203, 113.211, 113.213, and 113.214 from the regulations. These standards, which involve testing on live animals, are no longer used by the industry because newer testing methods are available.

We solicited comments concerning our proposal for 60 days ending July 29, 2014. We did not receive any comments. Therefore, for the reasons given in the proposed rule, we are adopting the proposed rule as a final rule, without change.

This final rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget.

In accordance with the Regulatory Flexibility Act, we have analyzed the potential economic effects of this action on small entities. The analysis is summarized below. Copies of the full analysis are available on the Regulations.gov Web site (see footnote 1 in this document for a link to Regulations.gov) or by contacting the person listed under FOR FURTHER INFORMATION CONTACT .

APHIS is amending the regulations in order to better define the terminology used when reporting the results of tests performed on veterinary biological products, thereby bringing the regulations up to date with current industry standards.

The changes will clarify when the results of a prescribed test can be reported as satisfactory, unsatisfactory, inconclusive, or can be designated as a No Test. The definitional changes will improve communication between APHIS and the regulated industry, and enable APHIS to more efficiently process the release of a tested product using current industry standards for reporting of test results.

There are about 330 firms in the United States that manufacture biological products. It is not known how many of these firms are engaged in manufacturing biologic products specifically for veterinary purposes. The Small Business Administration (SBA) standard for a small business in this industry is a firm with not more than 500 employees; the average firm in this industry has 93 employees. While most firms that would be affected by this rule are small, the changes will not impose a financial burden on them, but rather help make the product approval process timelier.

Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.

This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.)

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. This rule will not preempt any State or local laws, regulations, or policies where they are necessary to address local disease conditions or eradication programs. However, where safety, efficacy, purity, and potency of biological products are concerned, it is the Agency's intent to occupy the field. This includes, but is not limited to, the regulation of labeling. Under the Act, Congress clearly intended that there be national uniformity in the regulation of these products. There are no administrative proceedings which must be exhausted prior to a judicial challenge to the regulations under this rule.

This final rule contains no new information collection or recordkeeping requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

Accordingly, we are amending 9 CFR parts 101 and 113 as follows:

This final rule amends regulations that implement provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) that establish a new system of federal protections for remittance transfers sent by consumers in the United States to individuals and businesses in foreign countries. 1 The amendments in this final rule extend by five years an exception in the rule that allows remittance transfer providers flexibility in meeting disclosure requirements that the Bureau believes would otherwise cause some remittance transfer providers to stop sending certain transfers, as well as making clarifications and technical corrections on various issues. The Bureau proposed these amendments in April 2014 (the April Proposal or the Proposal).

The Dodd-Frank Act provisions adopted by Congress as section 919(a)(4) of the Electronic Fund Transfer Act (EFTA) generally requires that consumers be provided with exact pricing disclosures before paying for a remittance transfer. However, Congress created a temporary provision that allowed insured institutions for several years to provide estimated disclosures where exact information could not be determined for reasons beyond their control. The provision was apparently designed to provide a transition period to allow credit unions, banks, and thrifts to develop better communication mechanisms with foreign financial institutions that may help execute wire transfers and certain other types of remittance transfers.

The statute provides that the exception shall expire five years after the enactment of the Dodd-Frank Act, or July 21, 2015, but permits the Bureau, if it determines that expiration of the temporary exception would negatively affect the ability of insured institutions to send remittances to locations in foreign countries, to extend the temporary exception for up to ten years after enactment of the Dodd-Frank Act ( i.e., to July 21, 2020). EFTA section 919(a)(4)(B). Having made that determination after a period of public comment, the Bureau is now extending the Regulation E estimation provision that implements this statutory provision, § 1005.32(a) in the Remittance Rule, to July 21, 2020.

The Bureau is also adopting several clarifications and technical corrections to the Remittance Rule. First, the Bureau is clarifying that U.S. military installations abroad are considered to be located in a State for purposes of the Remittance Rule. Second, the Bureau is clarifying that whether a remittance transfer from an account is for personal, family, or household purposes (and thus, whether the transfer could be a remittance transfer) may be determined by ascertaining the primary purpose of the account. Third, the Bureau is clarifying that faxes are considered writings for purposes of satisfying certain provisions of the Remittance Rule that require remittance transfer providers to provide disclosures in writing, and that, in certain circumstances, a provider may provide oral disclosures after receiving a remittance inquiry from a consumer in writing. Fourth, the final rule permits providers to include the Bureau's new remittance-specific consumer Web pages as the Bureau Web site that providers must disclose on remittance transfer receipts. Finally, the Bureau is clarifying two of the rule's error resolution provisions: What constitutes an “error” caused by delays related to fraud and related screenings, and the remedies for certain errors, including the clarification of a comment in the official interpretation to the rule.

As the Bureau discussed in more detail when it first published the Remittance Rule in February 2012, consumers can choose among several methods of transferring money to foreign countries (February 2012 Final Rule). 77 FR 6194 (Feb. 7, 2012). These methods generally involve either closed network or open network systems, although hybrids between open and closed networks also exist. Consistent with EFTA section 919, the Remittance Rule applies to remittance transfers sent through any electronic mechanism, including closed network and open network systems, or some hybrid of the two. As detailed below, in practice, the situations in which the temporary exception applies frequently involve remittance transfers sent through open networks.

In a closed network, a remittance transfer provider uses either its own operations or a network of agents or other partners to collect funds from senders in the United States and disburse those funds to designated recipients abroad. Through the provider's contractual arrangements with those agents or other partners, the provider typically can exercise some control over the remittance transfer from end to end, including the ability to set, limit, and/or learn of fees, exchange rates, and other terms of service. Accordingly, the Bureau expects that a provider that is sending remittance transfers using some version of a closed network is likely able to leverage its control and knowledge of the transfer terms in order to be able to disclose the exact exchange rates and third-party fees that apply to remittance transfers.

Non-depository institutions, known generally as money transmitters, are the type of remittance transfer providers that most frequently use closed networks to send remittance transfers. Remittance transfers sent through money transmitters can be funded by the sender and received abroad using a variety of payments devices. However, the Bureau believes that most remittance transfers sent by money transmitters are currently sent and received abroad in cash, rather than as, for example, debits from and/or direct deposits to accounts held by depository institutions or credit unions.

As the data discussed below indicates, the most common form of open network remittance transfer is a wire transfer, an electronically transmitted order that directs a receiving institution to deposit funds into an identified beneficiary's account. Indeed, virtually all bank respondents to the March 2014 Federal Financial Institutions Examination Council (FFIEC) Consolidated Reports of Condition and Income (FFIEC Call Report)  2 who reported that they were remittance transfer providers said they provided wire transfer services to consumers. 3 Unlike closed network transactions, which generally can only be sent to entities that have signed on to work with the specific provider in question, wire transfers can reach most banks (or other similar institutions) worldwide through national payment systems that are connected through correspondent and other intermediary bank relationships. Also unlike closed networks, open networks are typically used to send funds from and to accounts at depository institutions, credit unions, or similar financial institutions. The Bureau believes that the great majority of open network transfers are provided by insured institutions (including credit unions) and that, in turn, open network transfers are the most common type of remittance transfer provided by insured institutions and broker-dealers. However, some money transmitters also use open networks to send some or all of their remittance transfers.

In an open network, the remittance transfer provider with which the consumer interfaces ( i.e., the originating institution), typically does not have control over, or a relationship with, all of the participants in transmitting the remittance transfer. The originating institution may communicate indirectly with the designated recipient's institution by sending funds and payment instructions to a correspondent institution, which will then transmit the instructions and funds to the designated recipient's institution directly, such as in the form of a book transfer, or indirectly through other intermediary institutions (a serial payment). Alternatively, under certain circumstances, the originating institution may send payment instructions directly to the designated recipient's institution, but it will nevertheless rely on a network of intermediary bank relationships to send funds for settlement (a cover payment). In some cases, depending on how the transfer is sent, any one of the intermediary institutions through which the remittance transfer passes may deduct a fee from the principal amount (sometimes referred to as a lifting fee). Likewise, if the originating institution does not conduct any necessary currency exchange, any institution through which the funds pass potentially could perform the currency exchange before the designated recipient's institution deposits the funds into the designated recipient's account.

Institutions involved in open network transfers may learn about each other's practices regarding fees or other matters through contractual or other relationships, through experience in sending such transfers over time, through reference materials, through information provided by consumers, or through surveying other institutions. However, at least until the implementation of the Remittance Rule, intermediary and designated recipient institutions did not, as a matter of uniform practice, communicate with originating institutions regarding the fees and exchange rates that institutions might apply to transfers. Further, the communication systems used to send these transfers typically do not facilitate two-way, real-time transmission of information about the exchange rate and fees associated with the transfers sent through an open network. See generally 78 FR 30662, 30663 (May 22, 2013).

In recent years, some depository institutions and credit unions have begun to send remittance transfers through the automated clearing house (ACH) system, although use of ACH for consumer transfers is limited. In the FFIEC Call Report for the quarter ending March 31, 2014, only 78 of the 691 depository institutions that reported being remittance transfer providers also reported that they provide international ACH services for consumers. When the Bureau first issued the Remittance Rule in February 2012, the Bureau explained that it considered international ACH transfers to be open network transactions. Like wire transfers, international ACH transfers can involve payment systems in which a large number of institutions may participate, such that the originating institution and the designated recipient's institution may have no direct relationship. The Bureau acknowledged, however, that international ACH transfers also share some characteristics of closed network transfers. The agreements among gateway ACH operators in the United States and foreign entities involved may be used to control the amount and type of fees that are charged and/or exchange rates that are applied to a remittance transfer. To maintain consistency with the Bureau's prior rulemakings, international ACH transfers are discussed herein as open network transactions.

Based on available information and as discussed in greater detail below, the Bureau believes that closed network transactions facilitated by money transmitters make up the great majority of the remittance transfers sent. Relatedly, the Bureau believes that money transmitters collectively send far more remittance transfers each year than depository institutions and credit unions. In January 2014, in connection with a “larger participant” rulemaking (discussed in greater detail below), the Bureau estimated that money transmitters annually send about 150 million international money transfers, most of which the Bureau believes would likely qualify as remittance transfers pursuant to § 1005.30(e) and, thus, be covered by the Remittance Rule. See 79 FR 5302, 5306. (Jan. 31, 2014). By comparison, information reported by credit unions to the National Credit Union Administration (NCUA) through the NCUA Call Report and Credit Union Profile forms (NCUA Call Report) suggests that credit unions may have collectively sent less than one percent of this total in 2013 ( i.e. less than 1 million remittance transfers collectively). Data from the FFIEC Call Report confirm that depository institutions send many more remittance transfers than credit unions, but still far fewer than money transmitters. Specifically, the data show that banks that are considered remittance transfer providers pursuant to § 1005.30(f) collectively sent about 2.2 million remittance transfers from October 28 through December 31, 2013. 4 Annualizing this figure (without any seasonal adjustments to account for the fact that this data cover the Christmas-New Year holiday season, which the Bureau understands to be traditionally a time of increased transfer volume), the Bureau estimates that depository institutions collectively sent at most 13.2 million international transfers in 2013. This figure is less than 10 percent of the estimated 150 million remittance transfers sent by money transmitters. Although the Bureau believes that money transmitters are responsible for sending the great majority of the remittance transfers, it believes that the typical size of transfers sent by depository institutions and credit unions is larger than the typical size of transfers sent by a money transmitter. 5 A transfer sent by a depository institution or credit union may be in the thousands of dollars, while the Bureau estimates that the typical size of remittance transfers sent by money transmitters is in the hundreds of dollars. 6

Section 1073 of the Dodd-Frank Act amended EFTA by establishing a new consumer protection regime for remittance transfers sent by consumers in the United States to individuals and businesses in foreign countries. For covered transactions sent by remittance transfer providers, section 1073 created a new EFTA section 919. It generally requires: (i) The disclosure of the actual exchange rate and remitted amount to be received prior to and at the time of payment by the consumer; (ii) cancelation and refund rights; (iii) the investigation and remedy of errors by providers; and (iv) liability standards for providers for the acts of their agents. 15 U.S.C. 1693o-1.

EFTA section 919 provides two exceptions to the requirement that providers disclose actual amounts. 7 The first, the temporary exception, is an accommodation for insured depository institutions and credit unions, in apparent recognition of the fact that these institutions might need additional time to develop the necessary systems or protocols to disclose the exchange rates and/or covered third-party fees that could be imposed on a remittance transfer. The temporary exception permits an insured institution that is sending a remittance transfer from the sender's account to provide reasonably accurate estimates of the amount of currency to be received where that institution is “unable to know [the amount], for reasons beyond its control” at the time that the sender requests a transfer through an account held with the institution. EFTA section 919(a)(4)(A). The temporary exception sunsets five years from the date of enactment of the Dodd-Frank Act ( i.e., July 21, 2015), but EFTA section 919, as added by section 1073 of the Dodd-Frank Act, permits the Bureau to extend that date up to five more years ( i.e., July 21, 2020), if the Bureau determines that the termination of the temporary exception on July 21, 2015, would negatively affect the ability of insured depository institutions and insured credit unions to send remittance transfers. EFTA section 919(a)(4)(B).

The second statutory exception in EFTA section 919 is permanent. The exception provides that if the Bureau determines that a recipient country does not legally allow, or that the method by which the transactions are made in the recipient country does not allow, a remittance transfer provider to know the amount of currency that will be received by the designated recipient, the Bureau may prescribe rules addressing the issue. EFTA section 919(c).

The Bureau initially issued regulations to implement section 1073 of the Dodd-Frank Act in February 2012, which was followed by two significant rounds of amendments and some additional minor clarifications and technical corrections. The consolidated Remittance Rule took effect on October 28, 2013.

The Board of Governors of the Federal Reserve System (the Board) first proposed in May 2011 to amend Regulation E to implement the remittance transfer provisions in section 1073 of the Dodd-Frank Act. 76 FR 29902 (May 23, 2011). On February 7, 2012, the Bureau finalized the Board's proposal, as authority to implement the new Dodd-Frank Act provisions amending EFTA had transferred from the Board to the Bureau on July 21, 2011. See 12 U.S.C. 5581(a)(1); 12 U.S.C. 5481(12) (defining “enumerated consumer laws” to include EFTA).

The Remittance Rule includes provisions that generally require a remittance transfer provider to provide to a sender a written pre-payment disclosure containing detailed information about the transfer requested by the sender. The information includes, among other things, the exchange rate, certain fees and taxes, and the amount to be received by the designated recipient. In addition to the pre-payment disclosure, the provider also must furnish to a sender a written receipt when payment is made for the transfer. The receipt must include the information provided on the pre-payment disclosure, as well as additional information, such as the date of availability of the funds, the designated recipient's name and, if provided, contact information, and information regarding the sender's error resolution and cancellation rights. In some cases, a provider may provide the required disclosures orally or via text message. Section 1005.31(a)(3)-(5). As is noted below, the Bureau subsequently modified provisions regarding the disclosure of foreign taxes and certain recipient institution fees in May 2013.

The Remittance Rule generally requires that the required disclosures state the actual exchange rate, if any, that will apply to a remittance transfer, and the actual amount that will be received by the designated recipient of the transfer, unless an exception applies. Section 1005.32(a) implements the temporary exception. Section § 1005.32(b)(1) implements the permanent statutory exception. As implemented by the Bureau, this permanent exception permits a remittance transfer provider to rely on a list of countries published by the Bureau to determine whether estimates may be provided. 8 The Remittance Rule also implements EFTA sections 919(d) and (f), which direct the Bureau to promulgate error resolution standards and rules regarding appropriate cancellation and refund policies, as well as standards of liability for remittance transfer providers.

The Bureau amended the Remittance Rule on August 20, 2012. 9 These amendments include a safe harbor defining which persons are not remittance transfer providers for purposes of the Remittance Rule, because they do not provide remittance transfers in the normal course of their business. The amendments also include provisions that apply to remittance transfers that are scheduled significantly in advance of the date of transfer, including a provision that allows a provider to estimate certain disclosure information for such transfers. See § 1005.32(b)(2).

Following the initial publication of the Remittance Rule in February 2012, the Bureau engaged in dialogue with both industry and consumer groups regarding implementation efforts and compliance concerns. As an outgrowth of those conversations, the Bureau proposed amendments to specific aspects of the Remittance Rule in a notice of proposed rulemaking published on December 31, 2012, in order to avoid potentially significant disruptions to the provision of remittance transfers. See 77 FR 77188 (Dec. 31, 2012). The Bureau then decided to delay temporarily the Remittance Rule's original effective date of February 7, 2013, in order to complete this additional rulemaking. See 78 FR 6025 (Jan. 29, 2013).

The Bureau finalized these proposed amendments in May 2013. 78 FR 30662 (May 23, 2013). In these amendments, the Bureau modified the Remittance Rule to make optional the requirement to disclose taxes collected on the remittance transfer by a person other than the remittance transfer provider and in certain circumstances, the requirement to disclose fees imposed by a designated recipient's institution (defined as non-covered third-party fees). In place of these two disclosure requirements, the Remittance Rule now requires providers, where applicable, to add disclaimers to the disclosures they must provide to sender. The disclaimers must inform senders that due to non-covered third-party fees and taxes collected on the transfer by a person other than the remittance transfer provider, the designated recipient may receive less than the amount listed on the disclosures as the total amount of funds that will be received by him or her. The May 2013 amendments also created an additional permanent exception that allows providers to estimate, if they choose to, non-covered third-party fees and taxes collected on the remittance transfer by a person other than the provider. See § 1005.32(b)(3). Finally, the Bureau revised the error resolution provisions that apply when a remittance transfer is not delivered to a designated recipient because the sender provided incorrect or insufficient information. 10 The Remittance Rule then became effective on October 28, 2013.

Section 1024 of the Dodd-Frank Act establishes that the Bureau may supervise certain nonbank covered persons that are “larger participants” in consumer financial markets, as defined by rule. 12 U.S.C. 5514(a)(1)(B). Pursuant to this authority, the Bureau published a proposal on January 31, 2014, to identify a nonbank market for international money transfers and define “larger participants” of this market that would be subject to the Bureau's supervisory program. 79 FR 5302 (Jan. 31, 2014). Specifically, the proposal would extend Bureau supervisory authority to any nonbank international money transfer provider that has at least one million aggregate annual international money transfers to determine compliance with, among other things, the Remittance Rule. The comment period on this proposal ended on April 1, 2014, and the Bureau is in the process of preparing to issue a final rule. 11

The Bureau has been actively engaged in an initiative to support implementation of the Remittance Rule. For example, the Bureau has established a Web page that contains links to various industry and consumer resources. 12 These resources include a small entity compliance guide that provides a plain-language summary of the Remittance Rule and highlights issues that businesses, in particular small businesses, may want to consider when implementing the Remittance Rule. In conjunction with the release of this final rule, the Bureau is revising the compliance guide to update its text to reflect the changes to the Remittance Rule adopted herein and improve the guide's clarity. A video overview of the Remittance Rule and its requirements, model forms, and other resources are also available.

Consumer resources the Bureau has created include answers to frequently asked questions regarding international money transfers, and materials that consumer groups and other stakeholders can use to educate consumers about the new rights provided to them by the Remittance Rule. 13 Some of these resources are available in languages other than English. The Bureau has also conducted media interviews in English and Spanish and participated in other public engagements to publicize the new consumer rights available under the Remittance Rule. The Bureau continues to provide ongoing guidance support to assist industry and others with interpreting the Remittance Rule, and has sent staff to speak at conferences and in other for a, both to provide additional guidance on the Remittance Rule, and learn from providers and others about efforts to comply with the Rule.

As noted, EFTA section 919(a)(4)(B) permits the Bureau to issue a rule to extend the temporary exception if it determines that the termination of the exception on July 21, 2015, would negatively affect the ability of insured institutions to send remittance transfers. In February 2012, the Bureau noted that some industry commenters urged the Bureau at that time to make the temporary exception permanent, or in the alternative, extend the exception to July 21, 2020. The Bureau declined to extend the exception in February 2012. It believed then that it would have been premature to make a determination on the extension of the temporary exception three years in advance of the July 2015 sunset date, prior to the rule's release, and before the market has had a chance to respond to the regulatory requirements. See 77 FR 6194, 6202, and 6243 (Feb. 7, 2012).

Since the Bureau first issued the Remittance Rule, the Bureau has supplemented its understanding of the remittance transfer market through information received in the course of subsequent rulemakings, additional research and monitoring of the market, and initiatives related to the implementation of the Remittance Rule. The additional research and monitoring have included in-depth conversations with several remittance transfer providers about how they have implemented the requirements of the Remittance Rule, participation in industry conferences and related meetings, as well as similar monitoring efforts. In addition, Bureau staff conducted interviews with approximately 35 industry stakeholders and consumer groups after the Remittance Rule took effect in connection with this rulemaking. 14 Through these interviews, the Bureau gathered information regarding providers' reliance on the temporary exception for certain remittance transfers, and whether viable alternatives currently exist for those transfers. The Bureau conducted the interviews in order to build on the Bureau's existing knowledge and assist it in making a determination as to whether expiration of the temporary exception on July 21, 2015, would negatively affect the ability of insured institutions to send remittance transfers. 15

The industry stakeholders that the Bureau contacted included both remittance transfer providers and service providers. The Bureau contacted community banks, regional banks, credit unions, nonbank service providers, and very large banks that send remittance transfers on behalf of their retail customers and on behalf of other providers. The Bureau also contacted remittance transfer providers that are broker-dealers. The Bureau believes that broker-dealers may send transfers via open networks, similar to those used by many insured institutions. 16 The Bureau also contacted nonbank money transmitters that use open networks to send some of their transfers. Although the temporary exception only applies to insured institutions, the Bureau believed that interviewing certain nonbank money transmitters that send open network transfers without being able to rely on the temporary exception would help the Bureau better understand what methods exist for providing exact disclosures for open network transfers. The service providers that the Bureau contacted included correspondent banks and corporate credit unions, bankers' banks, and foreign banks that offer correspondent banking services to U.S.-based remittance transfer providers, or act as intermediaries in the payment clearing and settlement chain. Insofar as the conversations were voluntary, the Bureau did not ultimately speak with every institution it contacted.

As noted above, the Bureau has also reviewed NCUA Call Report. 17 The data provided information on the number and types of remittances sent by credit unions, the methods by which credit unions send remittance transfers, and the payment systems credit unions utilize to send remittance transfers. Additionally, as discussed above, the Bureau has reviewed FFIEC Call Report data about remittance transfer practices. On the forms due in April 2014 regarding the reporting period from January 1 through March 31, 2014, depository institutions were required to provide select information, including, as relevant here, information on the types of remittance transfers provided and, for institutions that provide more than 100 transfers per year, the number and dollar value of remittance transfers sent by the reporting institutions in their capacity as remittance transfer providers. The report also included information on the frequency with which a reporting institution uses the temporary exception in its role as a remittance transfer provider. 18

The Bureau notes that the data from the NCUA and FFIEC Call Reports do not cover every practice, or every type of remittance transfer providers and service providers that the Bureau has researched and interviewed through its market monitoring efforts. However, as noted in the April Proposal, the FFIEC and NCUA Call Reports have the potential to provide valuable quantitative data to complement the more in-depth qualitative information that the Bureau has been able to gather through interviews and other sources because the scope of the data covers every depository institution and credit union reporting to the NCUA and FFIEC, respectively. At this point, the value of the data collected in the first quarter FFIEC Call Report is limited in part because there has only been one reporting cycle. The Bureau will continue to monitor the data, with a focus on trends over time. The Bureau also expects to continue to assess the data as depository institutions become more familiar with these new reporting requirements. Finally, to the extent that responses to the FFIEC Call Report can provide an accurate measure of the extent of the utilization of the temporary exception by insured institutions, this measure is not the only, nor necessarily the primary factor that the Bureau has considered in determining whether to extend the temporary exception under EFTA section 919(a)(4)(B).

The Bureau also notes that in connection with the April Proposal, it consulted with consumer groups to attempt to identify the effects, if any, that estimating covered third-party fees and exchange rates may have on consumers, as well as the potential effect on consumers of the expiration of the temporary exception, and, in the alternative, its extension to July 21, 2020.

As noted above, in April 2014, the Bureau proposed amendments to various provisions of the Remittance Rule to extend a temporary provision that permits insured institutions to estimate certain third-party fees and exchange rates, and to clarify or revise several regulatory provisions and official interpretations previously adopted by the Bureau.

The primary focus of the April Proposal was the temporary exception. The Bureau proposed to extend the Regulation E estimation provision in § 1005.32(a). That provision allows remittance transfer providers to estimate certain third-party fees and exchange rates associated with a remittance transfer, if certain conditions are met. Specifically, a remittance transfer provider may rely on the temporary exception if (1) the provider is an insured depository institution or credit union; (2) the remittance transfer is sent from the sender's account with the provider; and (3) the provider cannot determine the exact amounts for reasons outside of its control. Based on its outreach and internal research and analysis, the Bureau preliminarily determined that the termination of the temporary exception would negatively affect the ability of insured institutions to send remittance transfers. Thus, the Bureau proposed to amend § 1005.32(a)(2) by extending the temporary exception by five years from July 21, 2015, to July 21, 2020.

The Bureau also proposed several clarificatory amendments and technical corrections to the Remittance Rule. First, the Bureau sought comment on whether (and if so, how) it should clarify treatment of U.S. military installations located in foreign countries for purposes of the Remittance Rule. The Bureau explained in the April Proposal that it believes there is a potential for confusion in the treatment of these transfers, because the Remittance Rule does not expressly address their status. Second, the Bureau proposed to clarify that whether a transfer from an account is for personal, family, or household purposes (and thus, whether the transfer is a remittance transfer) can be determined by ascertaining the purpose for which the account was created. Third, the Bureau proposed to clarify that faxes are considered writings for purposes of certain disclosure provisions of the Remittance Rule, and that, in certain circumstances, a remittance transfer provider may provide oral disclosures, after receiving a remittance inquiry from a consumer in writing. Finally, the Bureau proposed to clarify two of the rule's error resolution provisions. More specifically, the Bureau proposed to clarify what constitutes an “error” caused by delays related to fraud and related screening, and the remedies for certain errors.

The Bureau received more than 30 comments on the April Proposal. The majority of comments were submitted by industry commenters, including depository institutions of various sizes, money transmitters, and industry trade associations. In addition, the Bureau received comment letters from two consumer groups.

Industry commenters overwhelmingly supported the April Proposal, and agreed with the Bureau's preliminary determination that the expiration of the temporary exception would have a negative impact on the ability of insured institutions to send remittance transfers. In support of the April Proposal, several institutions and industry trade associations explained how and why they used the temporary exception. Industry commenters further asserted that the temporary exception is critical and that they would not have the ability to disclose exact amounts for all remittance transfers by July 2015. Other commenters expressed concern that the expiration of the temporary exception could cause many community banks to either exit the remittance transfer market, or significantly cut back the scope of their services.

The two consumer group commenters both opposed this part of the April Proposal. One consumer group commenter asserted that the Bureau should limit the extension of the temporary exception to situations where it was necessary, as defined by the Bureau, or for shorter period of time, rather than the full five years permitted by the Dodd-Frank Act. The other consumer group commenter asserted that if the Bureau were to extend the temporary exception, then it should require insured institutions that rely on the exception to disclose to customers that money transmitters ( i.e., remittance transfer providers that are not insured institutions and, thus, are not permitted by the Remittance Rule to rely on the temporary exception) would provide consumers with exact disclosures.

With respect to the Bureau's request for comment and data regarding the treatment of transfers to and from U.S. military installations located in foreign countries, the Bureau received several comments, but only limited data. Industry commenters generally urged the Bureau to determine that military installations located in foreign countries be treated as being located in a State, so that, for example, transfers from a State to a U.S. military installation located in a foreign country would not be covered by the Remittance Rule. These commenters asserted that transfers to or from a U.S. military installation were no different than domestic transfers that are already exempt from the Remittance Rule. One consumer group, however, urged that the Bureau take the opposite approach, and treat a U.S. military installation located in a foreign country as being located in the foreign country. This consumer group asserted that transfers received on a military installation in a foreign country should not be treated differently from transfers received outside the installation in the foreign country.

As for the Bureau's other proposed amendments, commenters generally supported the proposed changes, although some noted particular objections. Specifically, with respect to the proposed clarification concerning the treatment of faxes as writings, one commenter, a consumer group, opposed the change, arguing that faxes should only be allowed to comply with the Remittance Rule's disclosure requirements where the sender has consented to receive the disclosure by fax by providing E-Sign consent. Commenters also supported the Bureau's proposal that would permit alternatives to disclosing the URL for the Bureau's Web site on required receipts, as well as the Bureau's proposal that would permit remittance transfer providers to respond to written requests for a remittance transfer with oral disclosures, when providing written disclosures would be impractical. Commenters similarly supported the proposal to permit providers to look to the type of account from which the transfer is being sent to determine if the transfer is a remittance transfer (although, as discussed in greater detail below, one large money transmitter opposed the proposal, to the extent the proposal would have been a mandatory change).

The Bureau also received several comments regarding the proposed changes to the Remittance Rule's error resolution and remedy provisions. These comments were mixed. Regarding the proposed change clarifying the circumstances under which provider delay due to certain fraud screening would not be considered an error under the Rule, several commenters contended that the Bureau's proposed approach was too narrow, and that it would exclude several categories of screening-related delays that should be included in the Remittance Rule's exception. Other industry commenters disagreed; they supported the proposed change, and noted that it would cover the majority, if not all, of the delays financial institutions experience related to fraud screening. One consumer group commenter also supported these proposed changes. With respect to the proposed clarifications to the remedies for certain errors, some industry commenters supported, or did not oppose, the proposed clarifications, although several argued that providers should not have to refund their fees, in cases where the designated recipient did not receive the remittance transfer by the date of availability disclosed by the provider, because the sender had provided incorrect or insufficient information. Finally, several commenters urged the Bureau to adjust other parts of the Remittance Rule that were beyond the scope of the April Proposal.

In addition to the comments received on the April Proposal, Bureau staff conducted outreach with various parties about the issues raised by the Proposal or raised in comments. Records of these outreach conversations are reflected in ex parte submissions included in the rulemaking record (accessible by searching by the docket number associated with this final rule at www.regulations.gov ).

Section 1073 of the Dodd-Frank Act created a new section 919 of EFTA and requires remittance transfer providers to provide disclosures to senders of remittance transfers, pursuant to rules prescribed by the Bureau. As discussed above, the Dodd-Frank Act established a temporary exception in amending EFTA, which provides that subject to rules prescribed by the Bureau, insured depository institutions and insured credit unions may provide estimates of the amount to be received where the remittance transfer provider is “unable to know [the amount], for reasons beyond its control” at the time that the sender requests a transfer to be conducted through an account held with the provider. EFTA section 919(a)(4)(A). The Dodd-Frank Act further establishes that the exception shall terminate five years from the date of enactment of the Dodd-Frank Act ( i.e., July 21, 2015), unless the Bureau determines that the termination of the exception would negatively affect the ability of depository institutions and credit unions to send remittance transfers. In which case, the Bureau may extend the application of the exception to not longer than ten years after the enactment of the Dodd-Frank Act ( i.e., July 21, 2020). EFTA section 919(a)(4)(B).

In addition, EFTA section 919(d) provides for specific error resolution procedures and directs the Bureau to promulgate rules regarding appropriate cancellation and refund policies. Finally, EFTA section 919(f) requires the Bureau to establish standards of liability for remittance transfer providers, including those providers that act through agents. Except as described below, the final rule is adopted under the authority provided to the Bureau in EFTA section 919, and as more specifically described in this Supplementary Information.

As noted in the April Proposal, the Remittance Rule applies when a sender located in a “State” sends funds to a designated recipient at a location in a “foreign country.” See § 1005.30(c) and (g). Further, the Rule specifies that in the context of transfers to or from an account, the Rule's application depends on the location of the account rather than the account owner's physical location at the time of transfer. See comments 30(c)-2.ii and 30(g). The Rule does not, however, specifically address the status of a transfer that is sent to or from a U.S. military installation located in a foreign country, nor does the definition of “State” in subpart A of Regulation E (§ 1005.2(l)) directly address the definition's application to a U.S. military installation.

In the April Proposal, the Bureau recognized that the Remittance Rule's application to transfers sent to and from U.S. military installations located abroad could, in some cases, lead to confusion. Specifically, the Bureau had received inquiries about whether U.S. military installations located abroad should be treated as located in a State or in a foreign country. The Bureau noted that application of the Remittance Rule might also differ depending on whether the transfer was sent to or from a depository institution account or would be picked up by the recipient at a location on the military installation. For example, there could be confusion as to whether the Remittance Rule applies when a consumer in the United States sends a cash transfer to be picked up by a recipient at a financial institution (not into the recipient's account) on a U.S. military base in a foreign country. Depending on whether the financial institution is deemed to be at a location in a “foreign country” or a “State,” the Remittance Rule may or may not apply. There might also be confusion about whether a cash transfer from a consumer on a foreign military installation to a recipient in the surrounding country would be subject to the rule, again depending on whether the foreign military installation is deemed to be in a “State.”

The Bureau noted in the April Proposal, however, that the application of the Remittance Rule could be different for transfers from accounts of persons located on U.S. military installations abroad. When a transfer is made from such an account, whether the sender is located in a State is determined by the location of the sender's account rather than the physical location of the sender at the time of the transaction. Similarly, whether or not the Remittance Rule applies to transfers from the United States to accounts of different persons stationed at U.S. military installations abroad could differ, depending on the locations of those recipients' accounts. Thus, there may also be confusion as to whether the Remittance Rule applies when a transfer is sent from an account in the United States to an account located at a U.S. military installation abroad, to the extent such accounts exist.

In light of the complexity of these issues, the Bureau sought comment on whether it would be advisable to provide further clarity on this point and also sought data regarding these issues. The Bureau acknowledged in the April Proposal that it did not then have sufficient information or data to make a determination regarding whether the Remittance Rule should (or should not) treat foreign military installations as “States” for purposes of the Remittance Rule, both in the context of transfers received in cash and in the context of transfers sent to or from an account that is located on a military installation. Accordingly, the Bureau sought data on the relative number of transfers sent to and from individuals and/or accounts located on U.S. military installations in foreign countries. In addition, the Bureau sought comment on the appropriateness of extending any clarification regarding U.S. military installations to other U.S. government installations abroad, such as U.S. diplomatic missions.

The Bureau received several comments on this issue. While a small number of commenters reported on the number of transfers they send to overseas military installations, commenters did not provide data on the relative number of transfers sent to and from such installations. The vast majority of commenters, however, recommended that the Bureau treat U.S. military installations abroad as located “on U.S. soil,” and therefore exempt transfers sent to such installations from the Remittance Rule. Commenters favoring this approach provided various rationales. Several commenters, including a large bank, a community bank, and a State trade association, recommended exempting remittance transfers to U.S. military installations abroad from the Rule. They stated that such transfers present lower risks to consumers than remittance transfers sent from the United States to other foreign locations, because transfers involving U.S. military installations are generally sent to and from U.S. financial institutions, in U.S. dollars, using U.S. payment systems (thus subject to the rules of those systems). They further argued that such transfers do not involve fluctuating exchange rates, and will likely be subject to U.S. consumer protection laws (insofar as the recipient institution is a U.S. financial institution).

Other commenters, including community banks, large banks, credit unions, and trade associations, noted that other statutory and regulatory regimes currently treat U.S. military installations located abroad as located in the United States. For example, a large bank noted that deposits in foreign branches of U.S. financial institutions that are located on a U.S. military installation and governed by Department of Defense regulations are insured by the Federal Deposit Insurance Corporation, while deposits in foreign branches that are not located on such installations are not. A national trade association and a federal credit union similarly noted that the U.S. Postal Service treats mail sent from the United States to U.S. military installations overseas as domestic mail. Several other commenters, including a number of credit unions, urged the Bureau to exempt transfers to U.S. military installations abroad because, they claimed, many remittance transfer providers were already treating such installations as located on “U.S. soil.”

A few commenters did not support treating U.S. military installations as “States” for purposes of the Remittance Rule. One consumer group argued that the Bureau should treat military installations abroad as located in a foreign country because individuals who send remittance transfers to family members stationed abroad should receive the protections of the Remittance Rule. Other commenters, including a group of national trade associations, noted that any solution that applied exclusively to military installations would pose logistical challenges, because it may be difficult to determine whether a recipient or a recipient's account is located on a military installation. These commenters were either silent about how the Bureau should resolve the issue of money transfers to U.S. military installations or advocated that the Bureau maintain the status quo.

Based on its review of the comments received and its own analysis of this issue, the Bureau is persuaded, for the reasons discussed below, that transfers to individuals and accounts located on U.S. military installations located abroad, as well as transfers from individuals and their accounts located on U.S. military installations abroad to designated recipients in the United States, should be excluded from the Remittance Rule's application. Accordingly, the Bureau is finalizing revisions to the commentary to the definitions of “designated recipient” (§ 1005.30(c)) and “sender” (§ 1005.30(g)). These revisions clarify that, for purposes of determining whether a transfer qualifies as a “remittance transfer” under the Rule, persons or accounts that are located on a U.S. military installation abroad are considered to be located in a State. Pursuant to these revisions, revised comment 30(c)-2.i explains that funds that will be received at a location on a U.S. military installation that is physically located abroad are received in a State, and revised comment 30(c)-2.ii explains that, for transfers that are sent to a recipient's account, an account that is located on a U.S. military installation abroad is considered to be located in a State. As revised, comment 30(g)-1 now explains that senders or senders' accounts that are located on U.S. military installations that are physically located abroad are located in a State for purposes of subpart B.

The Bureau believes this approach provides clarity without undermining the important consumer protections provided by the Remittance Rule. The Bureau agrees with the majority of commenters that transfers from the United States to a U.S. military installation located abroad share many of the characteristics of domestic transfers, and as such harbor less risk for consumers than a typical remittance transfer. In sum, while the Bureau agrees that servicemembers and their families deserve to receive the same consumer protections that are available to all other consumers, the Bureau agrees with those commenters who asserted that the consumer protection concerns associated with transfers sent to locations in a foreign country generally do not apply to transfers sent to U.S. military installations abroad. Meanwhile, the Bureau notes that transfers from locations on U.S. military installations abroad to recipients in foreign countries may, in many circumstances, qualify as remittance transfers. Unlike the quasi-domestic nature of transfers to the U.S. military installations abroad, transfers from those installations to foreign countries are typically sent without the protection of laws and rules in place for domestic transfers and are more likely to be involve a foreign currency exchange. The Bureau will continue to monitor, through its complaint intake processes and other channels, whether particular concerns arise with respect to transfers involving U.S. military installations abroad.

The Bureau declines to adopt the bright-line test proposed by one money transmitter commenter that would have allowed remittance transfer providers to determine an account's location by looking at whether the account was held with a United States or a foreign financial institution. The Bureau believes that such a rule would be over-broad in that it would exclude transfers that are sent to accounts located in foreign branches of U.S. financial institutions, of which the Bureau believes there are many. Such transfers, with the limited exception of transfers to foreign branches located on U.S. military installations abroad, as discussed above, currently qualify as remittance transfers under the Rule, and the Bureau did not intend to change this result when it proposed to clarify the treatment of U.S. military installations.

The Bureau acknowledges that, as noted by a few commenters, there may be some scenarios in which it is impossible for the remittance transfer provider to know that the transfer will be sent to a location or account located on a U.S. military installation. The Bureau notes, however, that such scenarios already exist regardless of whether the transfer involves a U.S. military installation located abroad; indeed, the Bureau has previously addressed these scenarios in existing comment 30(c)-2.iii, which explains that, where a sender does not specify information about a designated recipient's account, a provider may make the determination of whether funds will received in a foreign country based on “other information.” Thus, those providers who currently make a determination about the location of a recipient or a recipient's account by, for example, looking at the routing number and address of the branch of the financial institution receiving the transfer, can continue to do so; the revised commentary merely provides that where they have specific information that the account is located on a U.S. military installation, they can treat the account as located in a State, notwithstanding any information to the contrary derived from the account's routing number.

Finally, the Bureau is not finalizing a provision that would address the application of the Remittance Rule to other U.S. government installations abroad. The Bureau did not receive any comments indicating that there is actual or potential confusion with respect to the Remittance Rule's application to non-military U.S. installations located in foreign countries.

Section 1005.30(g) provides that a “sender” under subpart B of Regulation E means a consumer in a State who primarily for personal, family, or household purposes requests a remittance transfer provider to send a remittance transfer to a designated recipient. Together with the definition of “remittance transfer” in § 1005.30(e), this means that for the Remittance Rule to apply to an electronic transfer of funds, the transfer must have been requested by a consumer primarily for personal, family, or household purposes.

In response to certain questions about how to determine whether the Remittance Rule applies to transfers sent from an account that is not an account for the purposes of Regulation E, such as a business account, the Bureau proposed to add comment 30(g)-2 to explain that a consumer is a “sender” only if the consumer requests a transfer primarily for personal, family, or household purposes. The proposed comment would have also explained that for transfers from an account, the primary purpose for which the account was established determines whether a transfer from that account is requested for personal, family, or household purposes. Accordingly, under the proposed clarification, a transfer is not requested primarily for personal, family, or household purposes if it is sent from an account that was not established primarily for personal, family, or household purposes, such as an account that was established as a business or commercial account or an account held by a business entity such as a corporation, not-for-profit corporation, professional corporation, limited liability company, partnership, or sole proprietorship, and a person requesting a transfer from such an account therefore is not a sender under § 1005.30(g). Having reviewed the comments received and for the reasons set forth below, the Bureau is adopting comment 30(g)-2 with the modifications explained below.

One of the two consumer group commenters supported this aspect of the April Proposal. Industry commenters generally supported clarifying that the Remittance Rule does not apply to transfers sent from business accounts. Several trade association commenters also supported the change but noted that some financial institutions may re-code accounts that were initially set up as consumer accounts as business accounts, based on the way an accountholder uses the account. The trade association commenters asserted that the Bureau should clarify that financial institutions could rely on the way the account is identified in their records at the time the transfer is requested to determine whether the transfer is made for personal, family, or household purposes. One large money transmitter commenter expressed concern about proposed comment 30(g)-2, because it interpreted the proposed comment to mean that a remittance transfer provider must apply the Remittance Rule to any transfer from a consumer account, even if the customer indicates that the transfer is for a business purpose. The commenter asserted that this interpretation would result in compliance burden for some money transmitters. It explained that it offers customers the ability to send transfers from accounts, but because it does not hold the accounts, it does not know whether those accounts are consumer or non-consumer accounts. Therefore, it relies on the purpose of a transfer, as indicated by its customer, to determine if the transfer is a remittance transfer for purposes of the Rule. A large bank commenter requested that the Bureau adopt additional commentary to clarify that the Remittance Rule does not apply to transfers from accounts held by a financial institution under a bona fide trust agreement because those accounts do not meet the definition of “account” under the general provisions of Regulation E.

The Bureau has considered the comments and, for reasons discussed in more detail below, is adopting as proposed the aspect of proposed comment 30(g)-2 that would have explained the definition of a “sender.” The Bureau is also adding new comment 30(g)-3, in which it is adopting the aspect of proposed comment 30(g)-2 that would have explained that a transfer sent from a non-consumer account is not requested primarily for personal, family, or household purposes, and therefore a consumer requesting a transfer from such an account is not a sender under § 1005.30(g).

Additionally, the Bureau is explaining in comment 30(g)-3 that a transfer from an account held by a financial institution under a bona fide trust agreement is also not requested for personal, family, or household purposes, and therefore a consumer requesting a transfer from such an account is not a sender under § 1005.30(g). Section 1005.2(b)(3) provides that the term “account” in Regulation E does not include an account held by a financial institution under a bona fide trust agreement. The Bureau believes that adding this clarification to comment 30(g)-3 is consistent with the Bureau's intent to clarify that insofar as a transfer is sent from an account, the Remittance Rule only applies to transfers from accounts that fall within the definition of “account” under the general provisions of Regulation E.

The Bureau is not adopting the aspect of the proposed comment 30(g)-2 that would have explained that the primary purpose for which the account was established determines whether a transfer from that account is for personal, family, or household purposes. Upon further consideration, the Bureau believes that this aspect of the proposed comment could have been interpreted to mean that a provider would have to apply the Remittance Rule to all transfers from a consumer account, even in situations in which the sender indicates that the primary purpose of the transfer is a non-consumer purpose. Although the Bureau continues to believes that a provider should be able to rely on the primary purpose for which the account was established to determine whether a transfer from that account is for personal, family, or household purposes, the Bureau believes that applying the Rule to all transfers from a consumer account, even in situations in which the sender indicates that the primary purpose of the transfer is a non-consumer purpose, would be in tension with the definition of a “sender.” The Bureau is also concerned that such a bright-line test could cause compliance burden, as suggested above by a large money transmitter, if required in all cases. The Bureau further believes that it is appropriate to draw a clear line with respect to the applicability of the Remittance Rule to transfers sent from accounts that were not established primarily for personal, family, or household purposes for providers who have access to that information.

Accordingly, as adopted, comment 30(g)-2 explains that a consumer is a “sender” only where he or she requests a transfer primarily for personal, family, or household purposes and that a consumer who requests a transfer primarily for other purposes, such as business or commercial purposes, is not a sender under § 1005.30(g). It further explains that if a consumer requests a transfer from an account that was established primarily for personal, family, or household purposes, then a remittance transfer provider may generally deem that the transfer is requested primarily for personal, family, or household purposes and the consumer is therefore a “sender” under § 1005.30(g). However, if the consumer indicates that he or she is requesting the transfer primarily for other purposes, such as business or commercial purposes, then the provider may deem the consumer not to be a sender under § 1005.30(g), even if the consumer is requesting the transfer from an account that is used primarily for personal, family, or household purposes.

Comment 30(g)-3 explains that a provider may deem that a transfer that is requested to be sent from an account that was not established primarily for personal, family, or household purposes, such as an account that was established as a business or commercial account or an account held by a business entity such as a corporation, not-for-profit corporation, professional corporation, limited liability company, partnership, or sole proprietorship, as not being requested primarily for personal, family, or household purposes. A consumer requesting a transfer be sent from such an account therefore is not a sender under § 1005.30(g). The comment also explains that a transfer that is sent from an account held by a financial institution under a bona fide trust agreement pursuant to § 1005.2(b)(3) is not requested primarily for personal, family, or household purposes, and a consumer requesting a transfer from such an account therefore is not a sender under § 1005.30(g).

Lastly, as discussed above, several trade association commenters suggested that the Bureau adopt guidance that would permit a financial institution to rely on the way an account is identified in its records at the time the transfer is requested (rather than when the account was established) to determine whether the transfer is made primarily for personal, family, or household purposes. The Bureau is not adopting this recommendation. The Bureau proposed comment 30(g)-2 to provide additional clarification that transfers from accounts that do not meet the definition of “account” under the general provisions of Regulation E are not subject to the Remittance Rule. Pursuant to § 1005.2(b)(1), an account at a financial institution is an “account” for purposes of Regulation E if it was “ established primarily for personal, family, or household purposes.” (Emphasis added.) In other words, the primary purpose for which an account was established determines whether the account is an “account” for purposes of Regulation E. Accordingly, the Bureau believes that adopting this suggestion would be inconsistent with § 1005.2(b)(1), which is a long-standing part of Regulation E. Insofar as commenters did not suggest why accounts should be treated differently for purposes of subpart B of Regulation E, the Bureau is not adopting this suggestion.

EFTA, as implemented by the Remittance Rule, generally requires remittance transfer providers to provide disclosures required by subpart B of Regulation E to the sender in writing. § 1005.31(a)(2). But neither the statute nor the Remittance Rule specifies what qualifies as a writing (except to state that written disclosures may be provided on any size of paper, as long as the disclosures are clear and conspicuous, see comment 31(a)(2)-2). The Bureau proposed comment 31(a)(2)-5, which would have explained that disclosures provided pursuant to § 1005.31 or § 1005.36 by facsimile transmission ( i.e., fax) are written disclosures for purposes of providing disclosures in writing pursuant to subpart B of Regulation E, and are not subject to the requirements for electronic disclosures set forth in § 1005.31(a)(2). Pursuant to § 1005.31(a)(2) and comment 31(a)(2)-1, a provider may provide the pre-payment disclosure to a sender in electronic form, without regard to the applicable requirements of the E-Sign Act, only if a sender electronically requests the provider to send the remittance transfer. However, with respect to other disclosures required by subpart B of Regulation E, the provider would have to comply with the consumer consent and other applicable provisions of the E-Sign Act. Proposed comment 31(a)(2)-5 would have reflected similar guidance with respect to disclosures made by fax. For the reasons set forth below, comment 31(a)(2)-5 is adopted as proposed.

Industry commenters overwhelmingly supported this aspect of the April Proposal. Several commenters asserted that the Bureau should expand the interpretation of “written disclosures” to include any electronic disclosure if the provider has met its obligations to comply with the E-Sign Act. Consumer group commenters had mixed reactions: one consumer group commenter supported the proposal, but the other asserted that faxes should be subject to the requirements for electronic disclosures set forth in § 1005.31(a)(2) because they are considered electronic records under the Uniform Electronic Transaction Act of 1999. 19 The Bureau has considered the comments and believes it is appropriate to use the Bureau's interpretive authority under EFTA to treat disclosures provided pursuant to § 1005.31 or § 1005.36 by fax as “written disclosures” for purposes of the Remittance Rule.

As the Bureau explained in the April Proposal, it considers disclosures made by fax to be a “writing” under the Remittance Rule because such disclosures are generally received on paper in a form the sender can retain. Additionally, the Bureau does not believe that treating faxes as writings will have any significant negative impact on the benefits consumers derive from the Remittance Rule, both because many consumers have long communicated with remittance transfer providers via fax and those consumers accept faxes as a legitimate and efficient method of communication. The Bureau observes that the consumer group that opposed interpreting disclosures provided via fax as written disclosures did not contend that such an interpretation would have a significant negative impact on the benefits consumers derive from the Remittance Rule. Thus, the Bureau believes it appropriate to interpret faxes as “a writing” for purposes of providing disclosures pursuant to § 1005.31 and § 1005.36. The Bureau, however, does not believe that it is necessary to clarify that any electronic disclosure constitutes a “writing” if the provider complies with the E-Sign Act. As discussed above, the Remittance Rule permits a provider to provide electronic disclosures instead of written disclosures, when such electronic disclosures are provided pursuant to § 1005.31(a)(2) as clarified by comment 31(a)(2)-1.

Section 1005.31(e)(1) states that a remittance transfer provider must provide the pre-payment disclosure when the sender requests the remittance transfer, but prior to payment for the transfer. Section 1005.31(a)(3) permits providers to make these pre-payment disclosures orally if the “transaction is conducted orally and entirely by telephone” and if certain other language and disclosure requirements are met. The Bureau recognized in the April Proposal that a provider may be uncertain as to how to comply with the timing requirements set forth in § 1005.31(e)(1) where a sender is neither physically present nor in “real time” communication with a provider's staff. To provide further clarification, the Bureau proposed to revise comment 31(a)(3)-2 to set forth that a remittance transfer provider may treat a written or electronic communication as an inquiry when it believes that treating the communication as a request would be impractical. In such circumstances, as long as the provider otherwise conducted the transaction orally and entirely by telephone, the provider could provide disclosures orally as permitted by § 1005.31(a)(3). The Bureau also proposed two conforming edits to comments 31(a)(3)-1 and 31(e)-1 to accommodate this change: the proposed revision to 31(a)(3)-1 would have distinguished the scenario proposed in revised 31(a)(3)-2 from a situation in which a sender requests a remittance transfer in person; the revision to 31(e)-1 would have clarified that a sender has not requested a remittance transfer for purposes of triggering the timing requirements set forth in § 1005.31(e)(1) where the provider treats the request as an inquiry.

All commenters who commented on this part of the Proposal generally supported the Bureau's proposed revisions, with the majority of commenters expressing support without reservation. Some commenters provided additional, specific feedback. For example, one consumer group stated that it supported the proposed revision only if the consumer who made the initial request in writing received a disclosure that his request was being treated as an inquiry. A number of trade associations sought additional illustrations of when it would be “impractical” for a provider to treat a communication as a request for a transfer. Finally, one community bank proposed that the Bureau allow providers to provide oral disclosures whenever a sender so requests.

The Bureau is finalizing the revisions as proposed with one change to improve clarity (specifically, removing “For example”). The Bureau declines to adopt the suggestion that providers be allowed to give oral disclosures whenever a sender opts for oral disclosures. As stated in its February 2012 Federal Register notice, the Bureau believes that Congress did not intend to permit remittance transfer providers to satisfy the disclosure requirements orally, except in limited scenarios, as set forth in the Remittance Rule and in this final rule.

With respect to the comment that a remittance transfer provider should be required to inform the sender that the provider is treating the sender's communication as an inquiry, the Bureau does not believe this additional, independent disclosure requirement is necessary. By definition, the provider provides the pre-payment disclosure before the consumer has paid for the remittance transfer; at this point in the transaction, there is little risk of consumer harm. Further, the Bureau believes the sender is likely to know and understand the status of his or her transaction in the course of the sender's subsequent oral communication with the provider. Finally, with respect to the request for further clarity regarding when it would be impractical for a provider to treat a communication as a request, the Bureau believes that the proposed comment, which the Bureau is adopting with a non-substantive change to improve its clarity, provides sufficient guidance in the form of a specific example.

Section 1005.31(b)(2)(vi) requires a remittance transfer provider to disclose the contact information for the Bureau, including the Bureau's Web site URL and its toll-free telephone number. The Remittance Rule does not specify which Bureau Web site URL should be provided on receipts, but the Model Forms published by the Bureau list the Bureau's Internet homepage— www.consumerfinance.gov. See Model Forms A-31, A-32, A-34, A-35, A-39, and A-40 of appendix A. In the April Proposal, the Bureau explained that it was creating a single page that would contain resources relevant to remittance transfers at www.consumerfinance.gov/sending-money, as well as a Spanish language Web site that would have resources relevant to remittance transfers at www.consumerfinance.gov/enviar-dinero. 20 Accordingly, the Bureau proposed to add comment 31(b)(2)-4 to explain that: (1) Providers could satisfy the requirement to disclose the Bureau's Web site by disclosing the Web address shown on Model Forms A-31, A-32, A-34, A-35, A-39, and A-40 of appendix A, (2) alternatively, providers could, but were not required to, disclose the Bureau's remittance-specific Web site, currently, www.consumerfinance.gov/sending-money, and (3) providers making disclosures in a language other than English could, but were not required to, disclose a Bureau Web site that would provide information for consumers in the relevant language, if such Web site exists.

Commenters generally expressed support for the proposed comment. Several commenters, however, sought additional confirmation that the proposed optional disclosures would remain optional. In addition, a consumer group sought confirmation that providers would only be permitted to provide a link to the Bureau's non-English Web site where the disclosure was provided in that same non-English language.

As the Bureau stated in both the proposed comment text and the discussion of that text in the preamble of the April Proposal, the alternative disclosures included in comment 31(b)(2)-4 are optional, and do not require remittance transfer providers to change existing receipts. Thus, while it urges providers to provide consumers with the most relevant, updated information available from the Bureau, the Bureau confirms that, at this time, providers can continue to disclose the Web site previously listed on all Model Forms. Likewise, the April Proposal was clear that providers may only disclose the Bureau's non-English Web site if they make disclosures in the “relevant” language used in the non-English Web site. The Bureau will publish a list of any URLs it maintains containing specific information about remittances in foreign languages on its Web site, currently, http://www.consumerfinance.gov/remittances-transfer-rule-amendment-to-regulation-e/.

For the reasons above, the Bureau is adopting proposed new comment 31(b)(2)-4 substantially as proposed, with minor revisions to include references to revised URLs and revised model forms that illustrated the alternative disclosures proposed by the comment. Specifically, the URLs for the English- and Spanish-language, remittance-specific Web sites are consumerfinance.gov/sending-moneyandconsumerfinance.gov/envois, respectively. The comment also clarifies that the Bureau will make available a list of other foreign-language URLs for Web sites that provide specific information about remittance transfers. In addition, to accommodate new comment 31(b)(2)-4, the Bureau is renumbering current comments 31(b)(2)-4, -5, and -6 as comments 31(b)(2)-5, -6, and -7, respectively, without any other changes. Finally, the Bureau is revising forms A-31 and A-40 of appendix A to illustrate the optional disclosures set forth in new comment 31(b)(2)-4. The other Model Forms remain unchanged.

As discussed above, EFTA section 919(a)(4)(A) establishes a temporary exception for insured institutions with respect to the statute's general requirement that remittance transfer providers must disclose exact amounts to senders. EFTA 919(a)(4)(B) provides that the exception shall terminate five years after the enactment of the Dodd-Frank Act ( i.e., July 21, 2015), unless the Bureau issues a rule to extend the temporary exception up to five more years ( i.e., July 21, 2020). Specifically, the statute permits the Bureau to extend the temporary exception to July 21, 2020, if the Bureau determines that the termination of the temporary exception on July 21, 2015, would negatively affect the ability of insured institutions to send remittance transfers. EFTA section 919(a)(4)(B). The Bureau implemented the temporary exception by adopting § 1005.32(a) in the Remittance Rule.

Section 1005.32(a)(1) provides that a remittance transfer provider may give estimates for disclosures related to: (1) The exchange rate used by the provider; (2) the total amount that will be transferred to the designated recipient inclusive of covered third-party fees, if any; (3) any covered third-party fees and (4) the amount that will be received by the designated recipient (after deducting covered third-party fees), if the provider meets three conditions. The three conditions are: (1) The provider must be an insured institution; (2) the provider must not be able to determine the exact amounts for reasons beyond its control; and (3) the transfer must be sent from the sender's account with the provider. Section 1005.32(a)(2) provides that the temporary exception expires on July 21, 2015. Section 1005.32(a)(3) provides that insured depository institutions, insured credit unions, and uninsured U.S. branches and agencies of foreign depository institutions are considered “insured institutions” for purposes of the temporary exception. 21

As discussed above, the Bureau proposed to amend § 1005.32(a)(2) to extend the expiration date of the temporary exception from July 21, 2015, to July 21, 2020, after it had reached a preliminary determination that the expiration of the temporary exception on July 21, 2015, would negatively impact the ability of insured institutions to send remittance transfers. The determination was based on the Bureau's own understanding of the remittance transfer market, information the Bureau gathered through approximately 35 interviews with remittance transfer providers, service providers, and consumer groups regarding the temporary exception, outreach to industry and consumers groups on the Remittance Rule generally, and a review of comment letters to prior remittance rulemakings and related materials. In the April Proposal, the Bureau sought comments on its preliminary determination that the expiration of the temporary exception on July 21, 2015, would have a negative impact on the ability of insured institutions to send remittance transfers. The Bureau also sought comments on whether it should extend the exception for a period less than the full five years permitted by statute or place other limits on the use of the temporary exception.

The Bureau additionally solicited comments on the current consumer impact of the temporary exception, as well as the potential consumer impact of either the expiration or the extension of the exception. For the reasons stated below, the Bureau has reached a final determination that the expiration of the temporary exception on July 21, 2015, would negatively affect the ability of insured institutions to send remittance transfers, and is therefore adopting the change to § 1005.32(a)(2) as proposed.

Industry commenters overwhelmingly supported the proposed extension of the temporary exception from July 21, 2015, to July 21, 2020. They generally agreed with the Bureau's description of the remittance transfer market and preliminary determination that the expiration of the temporary exception would have a negative impact on the ability of insured institutions to send remittance transfers, emphasizing that the expiration of the temporary exception on July 21, 2015, would cause some insured institutions to either exit the market or significantly reduce the number of destinations to which they send remittances.

Furthermore, comments from industry commenters were generally consistent with the Bureau's understanding of how insured institutions are complying with the Remittance Rule's requirements regarding disclosures of the applicable exchange rate and covered third party fees, including the compliance practices of small institutions. Some commenters, ranging from credit unions to a large bank, stated that they rely on larger service providers to help disclose covered third-party fees and exchange rates. Industry commenters also were largely in accord with the Bureau's understanding of the drawbacks to wire transfer alternatives such as international ACH and closed-network remittance transfer products that resemble products offered by money transmitters. Several trade association commenters asserted that even with the expansion of international ACH products and the development of new closed network systems, such expansion will provide a solution only for remittance transfers to a limited set of destination countries and that providers would have difficulty sending remittance transfers to some destinations without reliance on the temporary exception. This is consistent with the Bureau's understanding of current market conditions based on its interviews with many providers and service providers in the course of developing the April Proposal.

A number of bank and credit union commenters stated that they rely on the temporary exception, and trade association commenters stated that many of their members rely on the temporary exception for at least some portion of the remittance transfers sent by their customers and members. Several trade association commenters asserted that the ability of insured institutions to rely on the temporary exception is critical for certain remittance transfers and emphasized that there are real limitations that exist in open network payment systems that currently prevent insured institutions from being able to disclose actual amounts in all cases. A number of community bank and credit union commenters, as well as the trade associations that represent them, stated that the expiration of the temporary exception could cause many community banks to either exit the remittance transfer market or significantly cut back the scope of their services.

Some industry commenters, including a correspondent bank and several trade associations, expressed concern that, even if the Bureau extended the temporary exception by five years, insured institutions would not be able to develop a comprehensive solution that would allow them to disclose exact covered third-party fees and exchange rates for every corridor they currently serve by July 2020. Several industry commenters also asserted that the Bureau should work with Congress to change the temporary exception into a permanent one, and one commenter suggested that the Bureau should make the temporary exception permanent without waiting for Congress to act.

As discussed above, the Bureau sought comments on the current consumer impact of the temporary exception, as well as the potential impact of either the expiration or the extension of the exception. One State credit union trade association stated that its member credit unions indicated that they have not received any complaints from members who received disclosures containing estimated disclosures. A number of community bank and credit union commenters, as well as the trade associations that represent them, stated that the expiration of the temporary exception could cause many community banks to either exit the remittance transfer market or significantly cut back the scope of their services. They asserted that such a reduction would negatively impact consumers, because it would reduce the availability of remittance transfer services. They also expressed the concern that such a reduction could limit competition and drive up prices.

The two consumer group commenters opposed this part of the April Proposal. One of the consumer group commenters asserted that, rather than extend the exception for the maximum of five years permitted by the Dodd-Frank Act, the Bureau should limit the extension of the temporary exception. Specifically, this commenter suggested that the Bureau should: (1) Only extend the temporary exception for up to two years and reassess a further extension then; (2) limit the use of the exception to remittance transfers for which disclosing exact amounts is particularly difficult or impossible; or (3) reissue the proposal for additional comment and provide more specific information on the current state of compliance. The other consumer group commenter asserted that if the Bureau were to extend the temporary exception, then it should also require insured institutions that rely on the temporary exception to disclose to customers that money transmitters would be able to provide consumers with exact disclosures.

The Bureau has considered the comments and, for the reasons discussed below, is finalizing as proposed the extension of the temporary exception to July 21, 2020, because the Bureau has made the determination that the expiration of the temporary exception would negatively affect the ability of insured institutions to send remittance transfers. Comments from industry commenters generally confirmed the Bureau's original understanding of the remittance transfer market and preliminary determination that the expiration of the temporary exception would have a negative impact on the ability of insured institutions to send remittance transfers. 22 In particular, the Bureau understands that insured institutions typically send remittances in the form of wire transfers over open networks. With respect to a wire transfer, the insured institution that acts as the remittance transfer provider typically does not have control over, or a relationship with, all of the participants involved in a remittance transfer, to facilitate the provider's ability to control or obtain information about the applicable exchange rate and covered third-party fees with exactitude. Additionally, the communication systems used to send wire transfers typically do not facilitate two-way, real-time transmission of such information. While the Bureau understands that industry is working to restructure relationships and communication systems to provide more precise pricing information, this process is not yet complete.

While some insured institutions provide exact disclosures of the exchange rate and covered third-party fees for all of their remittance transfers, the Bureau understands that many rely on the temporary exception when disclosing the exchange rate and/or covered third-party fees for at least some portion of transfers initiated by their own consumer customers and as applicable, transfers they send on behalf of other providers. The Bureau also understands that many insured institutions, in particular small institutions, rely almost entirely on larger, intermediary service providers to act as information aggregators to provide them with the applicable exchange rate to disclose and/or covered third-party fee information. 23

With respect to the disclosure of the exchange rate, insured institutions have reported to the Bureau that they have found that one way to provide an exact exchange rate is to convert the funds to the applicable foreign currency based on a fixed exchange rate that the provider either obtains directly or from an information aggregator. However, the Bureau has learned that insured institutions cannot provide a fixed exchange rate for a number of currencies and rely on the temporary exception (or the Bureau's permanent exception for transfers to certain countries, § 1005.32(b)(2)) when disclosing the applicable exchange rate in such situations. The Bureau understands that these currencies are either (1) so thinly traded that insured institutions or their service providers find that purchasing such currencies and obtaining a fixed exchange rate for consumer wire transfers is impossible, impracticable, or economically undesirable, or (2) impracticable to purchase for other reasons ( e.g., foreign laws may bar the purchase of that currency in the United States). Further, even if obtaining and disclosing a fixed exchange rate were possible, the Bureau further understands that typically, the volume of remittance transfers involving such currencies is often low and providers believe that it is impracticable to expend significant resources to provide a fixed rate for these low-volume transactions.

With respect to covered third-party fees, the Bureau understands that information aggregators, described above, could directly generate the information from foreign banks in their correspondent banking networks or with whom they have other contractual relationships. Additionally, the Bureau understands that for a number of foreign destinations, these entities try to control the amount of covered third-party fees, or eliminate such fees altogether, by sending remittance transfers through nostro accounts they have established with various foreign banks, 24 using certain methods to send wire transfers that put participants processing the wire transfer on notice not to deduct a fee from the transfer amount, or through a combination of both.

The information aggregators have reported to the Bureau that as a result of proactively obtaining covered third-party fee information from foreign banks and using methods that control or eliminate such fees, they and, as applicable, their remittance transfer provider clients are typically disclosing exact covered third-party fees where they believe they are able to do so, even though they might have additional flexibility pursuant to the temporary exception to provide estimates instead. But at the same time, information aggregators have reported that the methods that allow insured institutions to control or eliminate covered third-party fees are not reliable in controlling or eliminating such fees for all of the destinations to which they send wire transfers. Additionally, with respect to obtaining covered third-party fees directly from foreign banks, a number of information aggregators have indicated that fee information gathered in this manner could be incomplete because it is not available for all institutions involved in all of the remittance transfers they send. Accordingly, a number of insured institutions have to rely on the temporary exception when sending at least some of their wire transfers.

The Bureau also sought information from insured institutions about their use of potential alternative methods of sending remittance transfers. In particular, the Bureau sought to understand whether insured institutions could control or eliminate covered third-party fees if they sent remittance transfers using international ACH instead of open network wire transfer systems. The Bureau understands that the Federal Reserve's international ACH product—FedGlobal ACH—generally restricts the deduction of fees from transfer amounts sent through the FedGlobal system, but is nonetheless used only for a small portion of insured institutions' remittance transfers. The Bureau has found that although a number of insured institutions use international ACH for commercial international money transfers, many did not see international ACH developing into an alternative to wire transfers in the near term. A number of insured institutions have reported that international ACH reaches far fewer destinations than wire transfers. They also expressed concern that developing an international ACH service for remittance transfers would involve costs and changes in operation systems that outweigh the potential long-term cost savings as well as any additional value of facilitating compliance with the Remittance Rule.

The Bureau also sought information from insured institutions about developing closed network remittance transfer products that resemble products offered by money transmitters that could allow them to control or eliminate covered third-party fees. The Bureau also understands that a small number of the largest institutions have already developed such products. However, most of the insured institutions that the Bureau interviewed did not set up closed network alternatives to wire transfers and indicated that they did not have plans to develop them. As discussed above, several trade association commenters believed that the expansion of international ACH products and the development of new closed network systems will not provide a comprehensive solution.

For the above reasons and those stated more fully in the April Proposal, the Bureau also believes that it is unlikely that there would be near-term solutions that would address the challenges in open-network payment systems that prevent insured institutions from being able to disclose exact amounts for all of the foreign destinations to which they send remittance transfers. Accordingly, the Bureau believes that it is appropriate to extend the length of the temporary exception for the full five years permitted by statute, rather than a shorter length of time (or not at all). The Bureau continues to believe that insured institutions will not be able to make the significant progress necessary for all institutions and corridors to warrant terminating the exception before July 2020, and does not believe that reassessing the situation after seeking additional public comment now or in two years would cause it to reach a different conclusion. At the same time, however, the Bureau believes that making the exception permanent in this rulemaking would be beyond its scope, which, pursuant to EFTA section 919(a)(4)(B), focused (on this issue) on whether the Bureau should extend the temporary exception by five additional years. Nevertheless, the Bureau will continue to monitor market and technological developments in open network payment systems. The Bureau expects insured institutions to continue to work towards providing actual disclosures for all remittance transfers by July 2020. The Bureau also notes that through its supervision of insured institutions it will continue to monitor the use of the exception, whether it is being abused, and whether and how providers are working towards finding a permanent solution for all remittance transfers.

The Bureau also believes that it is appropriate to extend the temporary exception without modifications or additional requirements. As noted above, the Bureau continues to believe that insured institutions are unable to make the significant progress necessary for the Bureau to cause the temporary exception to terminate before July 2020. Furthermore, the Bureau is not aware of evidence that insured institutions are improperly using the temporary exception or that consumers are being harmed by its use in particular or, more generally, by the receipt of disclosures containing estimates. The Bureau understands that although use of the temporary exception varies, the exception appears to be used for the minority of eligible transfers from insured institutions. The FFIEC Call Report asked banks to estimate the number of remittance transfers sent between October 28 and December 31, 2013, to which they applied the temporary exception. The FFIEC Call Report data suggest that the temporary exception is only used in approximately 10 percent of transfers sent by banks that are considered remittance transfer providers under the rule. Additionally, no data was submitted to the Bureau in response to the request in the April Proposal, and the Bureau is aware of no data, that contradicts its view that use of the temporary exception is limited to cases where providers (and their service providers) deem its use to be necessary.

Lastly, the Bureau believes that it would be inappropriate to require insured institutions that disclose estimates pursuant to the temporary exception to inform their customers that money transmitters may provide consumers with exact disclosures. The Bureau notes that Congress expressly permitted any remittance transfer provider to disclose estimates in lieu of exact amounts in certain cases without any additional disclosure. See § 1005.32(b)(1) (permanent exception for transfers to certain countries) and (b)(2) (advance transfers) without any additional disclosure. Insofar as money transmitters rely on these exceptions set forth in the Remittance rule, it cannot be said that they are disclosing exact amounts in those cases.

Section 1005.33(a)(1)(iv)(B) provides that a delay is not an “error” if it is related to the remittance transfer provider's fraud screening procedures or in accordance with the Bank Secrecy Act, 31 U.S.C. 5311, et seq., Office of Foreign Assets Control requirements, or similar laws or requirements. Section 1005.33(a)(1)(iv)(B). In the April Proposal, the Bureau explained that it did not intend for this provision to apply to delays related to routine fraud screening procedures; accordingly, the Bureau proposed to revise § 1005.33(a)(1)(iv)(B) to apply only to delays related to individualized investigation or other special action. To provide additional guidance, the Bureau proposed a new comment 33(a)-7, which would have explained that a delay is not an error where it is caused by an investigation or other special action necessary to address potentially suspicious, blocked, or prohibited activity.

The proposed comment included two examples of the types of delays that would not constitute an error under proposed § 1005.33(a)(1)(iv)(B), namely, a delay that occurs after a screening process flags a designated recipient's name as a potentially blocked individual, and a delay that occurs because the transfer is flagged as being similar to previous fraudulent activity. The proposed comment contrasted these two examples with delays caused by “ordinary fraud or other screening procedures, where no potentially fraudulent, suspicious, blocked or prohibited activity is identified,” which would not have qualified for the exception.

The Bureau sought comment on whether the proposed change to the regulatory text and related examples and description in the commentary accurately reflected industry practice and/or provided sufficient guidance on the types of permissible delays. The single consumer group that commented on this issue expressed its support for the proposed changes. Some industry commenters, including a large bank and a community bank, generally expressed support for the Bureau's effort to provide further clarity on the types of delays that qualify for the error exception, opining that the revisions suggested would cover the majority of relevant, screening-related delays.

The majority of commenters who addressed the issue, however, opposed the Bureau's proposed changes, for a variety of different reasons. Commenters, including State and national trade associations, credit unions, small and large banks, and a bank holding company, generally expressed concern that the revised language would discourage important fraud, terrorism, and anti-money laundering screenings by exposing providers that regularly conduct such screenings to liability under Regulation E. Other commenters, including a large money transmitter and a number of State credit union trade associations, argued that there is a false dichotomy between procedures that are “necessary” or “special” and those that are “ordinary.” They noted that enhanced screening procedures are a standard, routine part of most remittance transfer providers' “ordinary” business, and that whether or not such procedures are “necessary” cannot always be determined at the outset of an investigation.

A similar concern was expressed by a large money transmitter commenter. Among other concerns, it argued that the two examples proposed by the Bureau in proposed comment 33(a)-7 were too narrow, and the commenter opposed the use of the term “individualized” to characterize the types of procedures that would qualify for the exception under revised § 1005.33(a)(1)(iv)(B). According to this commenter's description of its standard fraud screening procedures, the Bureau's choice of examples and terminology did not adequately capture screening procedures that apply to certain categories of transfers—known as “block screenings”—rather than only to a particular transfer. For example, the commenter explained that remittance transfer providers sometimes receive real-time information from law enforcement that transfers going to a certain geographic area ( e.g., a particular country or part of a country) could have a high percentage likelihood of being related to a criminal operation. When the provider receives such information, it may temporarily delay all transfers that fit the characteristics identified by law enforcement. According to the commenter, under the proposed language, it would be unclear whether when such “block screenings” resulted in a delay, the commenter could would be able to rely on the § 1005.33(a)(1)(iv)(B) exception.

The Bureau is mindful that commenters are wary of any requirement that they view as creating potential liability for what they deem to be standard operational procedures. The Bureau believes, however, that the commenters have largely based their concerns on an inaccurate and overly narrow interpretation of the proposed revisions. The Bureau's proposal was related to disclosure; it did not dictate to remittance transfer providers the type of screening procedures they could adopt. The proposal would simply have required that, where a provider ordinarily applies a certain type of procedure in connection with a certain type of transfer, the provider account for any additional length of time associated with that screening into its disclosure of the estimated date of availability. This requirement would have applied whether the additional time was 30 minutes or five days—in other words, if the provider knew that a procedure would apply to a particular remittance transfer and would delay that remittance transfer for a period of time (whether it be 30 minutes or five days), the provider would have been required to adjust the disclosed date of availability accordingly.

Nonetheless, the Bureau understands that its attempt in proposed comment 33(a)-7 to draw a distinction between “ordinary” and “necessary” investigations could be construed as not accurately or completely capturing the types of procedures that the Bureau believes could qualify as an exception under § 1005.33(a)(1)(iv)(B). Accordingly, the Bureau is finalizing comment 33(a)-7 with a modification to clarify whether the remittance transfer provider could have reasonably foreseen the delay at the time the provider provided the date of availability disclosure. Specifically, comment 33(a)-7 now explains that a delay does not constitute an error, if such delay is related to the provider's or any third party's investigation necessary to address potentially suspicious, blocked or prohibited activity, and the provider did not, and could not have reasonably foreseen the delay so as to enable it to timely disclose an accurate date of availability when providing the sender with a receipt or combined disclosure. In addition, the Bureau is adding two additional examples to comment 33(a)-7 to illustrate the application of the revised language. The first example clarifies that there is no error where a provider delays a remittance transfer in order to investigate specific law enforcement information indicating that a remittance transfer may match a pattern of fraudulent activity if it was not reasonable to disclose that delay when the provider disclosed the date of availability. The second example states that, if a provider knows in time to make a timely disclosure that all remittance transfers to a certain area undergo a two-day long screening procedure, the provider must include an additional two days in its disclosure of the date of availability.

The Bureau notes that these examples do not represent the only situations that could satisfy this exception. The unique nature of the screenings at issue and the variety of business practices and technical capabilities among remittance transfer providers do not allow the Bureau to address every possible scenario. Furthermore, the Bureau emphasizes that nothing in the changes adopted herein should be construed as limiting a provider's ability to perform necessary screenings. Instead, the Bureau intends the revision to clarify that providers cannot avoid liability for an error in situations where they could have reasonably foreseen the delay so as to enable them to timely disclose an accurate date of availability but failed to disclose that date to the sender. Whether a provider could have reasonably foreseen a delay in time to make changes to its disclosure depends on the facts and circumstances surrounding the transfer. The Bureau believes that its approach in the final rule, as opposed to the April Proposal, responds to commenters' concerns that the proposed language was perhaps too narrow and did not allow for flexibility arising out of the varied nature of fraud and other screenings.

Finally, as proposed, the Bureau is renumbering existing comments 33(a)-7 through -10 as comments 33(a)-8 through -11, respectively, to reflect the insertion of new comment 33(a)-7.

Section 1005.33(c)(2) implements EFTA section 919(d)(1)(B) and establishes procedures and remedies for correcting an error under the Remittance Rule. In particular, where there has been an error under § 1005.33(a)(1)(iv) for failure to make funds available to a designated recipient by the disclosed date of availability, § 1005.33(c)(2)(ii) generally permits a sender to choose either: (1) To obtain a refund of the amount the sender paid to the remittance transfer provider in connection with the remittance transfer that was not properly transmitted, or an amount appropriate to resolve the error, or (2) to have the provider resend to the designated recipient the amount appropriate to resolve the error, at no additional cost to the sender or designated recipient. However, if the error resulted from the sender providing incorrect or insufficient information, § 1005.33(c)(2)(iii) requires a provider to refund or, at the consumer's request, reapply to a new transfer, the total amount that the sender paid to the provider, but it permits the provider to deduct from this amount fees actually imposed and, where not otherwise prohibited by law, taxes actually collected as part of the first unsuccessful remittance transfer attempt. Comment 33(c)-12 provides guidance on how a remittance transfer provider should determine the amount to refund to the sender, or to apply to a new transfer, pursuant to § 1005.33(c)(2)(iii). As explained in comment 33(c)-12, § 1005.33(c)(2)(iii) does not permit a provider to deduct its own fees from the amount refunded or applied to a new transfer. The Bureau proposed to amend § 1005.33(c)(2)(iii) by incorporating this guidance in current comment 33(c)-12 in the text of proposed § 1005.33(c)(2)(iii).

Proposed § 1005.33(c)(2)(iii) would have stated that in the case of an error under § 1005.33(a)(1)(iv) that occurred because the sender provided incorrect or insufficient information in connection with the remittance transfer, the remittance transfer provider shall provide the remedies required by § 1005.33(c)(2)(ii)(A)(1) and (B) within three business days of providing the report required by § 1005.33(c)(1) or (d)(1) except that the provider may agree to the sender's request, upon receiving the results of the error investigation, that the funds be applied towards a new remittance transfer, rather than be refunded, if the provider has not yet processed a refund. Proposed § 1005.33(c)(2)(iii) also would have provided that the provider may deduct from the amount refunded or applied towards a new transfer any fees actually imposed on or, to the extent not prohibited by law, taxes actually collected on the remittance transfer as part of the first unsuccessful remittance transfer attempt except that the provider shall not deduct its own fee.

In connection with the proposed change to § 1005.33(c)(2)(iii), the Bureau also proposed to modify comment 33(c)-5 by adding an example to further explain how a remittance transfer provider should determine the appropriate amount to resolve any error under § 1005.33(a)(1)(iv). Proposed comment 33(c)-5 would have explained that if the designated recipient received the amount that was disclosed pursuant to § 1005.31(b)(1)(vii) before the provider must determine the appropriate remedy, the amount appropriate to resolve the error would be limited to the refund of the appropriate fees and taxes that the sender paid, as determined by § 1005.33(c)(2)(ii)(B) or (c)(2)(iii) as applicable.

One consumer group commented on this aspect of the Proposal and supported the proposed clarifications. Industry commenters had mixed reactions. Several bank commenters and trade associations supported, or did not object to, the specific clarifications that the Bureau had proposed. However, a number of industry commenters asserted the general concern that it was not fair to prohibit remittance transfer providers from deducting their own fees from the amount refunded to a sender or applied to a new transfer in the case of an error under § 1005.33(a)(1)(iv), due to the sender providing incorrect or insufficient information.

Current § 1005.33(c)(2)(iii), as clarified by current comment 33(c)-12, already prohibits remittance transfer providers from deducting their own fees in the situation described above. Proposed § 1005.33(c)(2)(iii) would have stated more explicitly what is already required under current § 1005.33(c)(2)(iii), and, relatedly, proposed comment 33(c)-5 would have illustrated the existing requirement regarding the appropriate refund amount required to resolve an error pursuant to § 1005.33(a)(1)(iv) with an example. Further, this refund requirement has been part of the Remittance Rule since it was initially adopted in February 2012 and has been was in place since the rule took effect in October 2013. 25 The Bureau did not intend for the April Proposal to reopen the issue of what the appropriate remedy would be in the case of an error under § 1005.33(a)(1)(iv) that occurred because a sender did not provide correct or sufficient information in connection with a remittance transfer. The Bureau simply intended for the April Proposal clarify § 1005.33(c)(2)(iii) as previously adopted. The Bureau considers comments from industry commenters regarding whether it is appropriate for them to have to deduct their own fees from the amount refunded to a sender or applied to a new transfer in the case of an error under § 1005.33(a)(1)(iv), due to the sender providing incorrect or insufficient information in connection with the transfer, to be outside the scope of this rulemaking.

Finally, consistent with the Bureau's intent to clarify the requirement with respect to the appropriate remedy under § 1005.33(c)(2)(iii), the Bureau is adopting a technical correction to comment 33(c)-12.i to describe the total amount that a sender has paid the provider, the total amount of the refund that such sender will receive, and the portion of the total refund that is attributable to the provider's refund of its own fee in greater detail. The Bureau believes that revised comment 33(c)-12.i provides greater clarity with respect to how the total refund amount is calculated but the changes adopted do not alter the calculations. The Bureau believes that it is appropriate to adopt this technical correction without notice and comment because the correction is consistent with the Bureau's intent to clarify the requirement with respect to the appropriate remedy under § 1005.33(c)(2)(iii). 26

For the above reasons, the Bureau is adopting § 1005.33(c)(2)(iii) and comment 33(c)-5 as proposed, with the addition of the technical correction to comment 33(c)-12.i.

The Bureau proposed to have all of the changes included in the April Proposal take effect thirty days after publication of this final rule in the Federal Register . The Bureau had based the proposed implementation period on its belief that remittance transfer providers would only be required to make minimal changes to their practices to align them with the changes included in the Proposal. The Bureau sought comment on the proposed effective date, including on whether a later effective date would be more appropriate. Several industry commenters, including several trade associations representing credit unions and a money transmitter, asked the Bureau to adopt a longer implementation period, arguing that the changes proposed would require changes to compliance, training, and disclosure procedures. The majority of these commenters asked for a 90-day implementation period, while the money transmitter commenter asked for a 12-month implementation period. The Bureau agrees to provide a longer implementation period for this final rule in order to allow industry sufficient time to make the changes to systems and procedures that providers and their service providers deem necessary. Insofar as the clarifications adopted herein are largely optional or meant to clarify existing practices or requirements of the Remittance Rule, the Bureau does not believe that their implementation should result in significant operational changes for providers that would require a 12-month implementation period. Accordingly, the final rule will take effect 60 days from the date of publication in the Federal Register .

In developing this final rule, the Bureau has considered potential benefits, costs, and impacts  27 and has consulted or offered to consult with the prudential regulators and the Federal Trade Commission, including regarding the consistency of this final rule with prudential, market, or systemic objectives administered by such agencies. 28

The analysis below considers the benefits, costs, and impacts of the key provisions of this final rule against the baseline provided by the current Remittance Rule. This final rule makes the following changes to the Remittance Rule. First, this final rule extends the temporary exception in the Remittance Rule that permits insured depository institutions and insured credit unions to estimate the exchange rate and covered third-party fees under specified circumstances, from July 21, 2015, to July 21, 2020.

Second, this final rule makes several clarifying amendments and technical corrections to the current Remittance Rule concerning: The application of the Rule to transfers to and from locations on U.S. military installations abroad; the treatment of transfers from consumer and non-consumer accounts; the treatment of faxes; the treatment by a remittance transfer provider of a communication regarding a potential remittance transfer as an inquiry; the Web site addresses to be disclosed on consumer receipts; and error resolution provisions related to delays and remedies. With respect to these provisions, the analysis considers the benefits and costs to senders (consumers) and remittance transfer providers (covered persons). The Bureau has discretion in future rulemakings to choose the most appropriate baseline for that particular rulemaking.

The Bureau notes at the outset that the analysis below generally provides a qualitative discussion of the benefits, costs, and impacts of the final rule. The Bureau believes that quantification of the potential benefits, costs, and impacts of the provisions is not possible. There are limited data on consumer behavior, which would be essential for quantifying the benefits or costs to consumers. The Bureau also lacks information about the accuracy of estimates for exchange rates and covered third-party fees that could help inform the Bureau of the potential cost to consumers of extending the temporary exception to July 21, 2020, in terms of the benefit foregone of receiving actual (as opposed to estimated) information. Further, there are still limited data about the remittance transfer market such that the Bureau cannot presently quantify the potential benefits, costs, and impacts of the provisions on remittance transfer providers. Nonetheless, the Bureau has reviewed the available data about the remittance transfer market, which now includes responses in the NCUA and FFIEC Call Report filings. As noted above, the Bureau believes that the additional data have enhanced the Bureau's understanding of the remittance transfer offerings of credit unions and depositary institutions, including with respect to the number of transfer sent and the methods used to send those transfers. As is discussed above, and consistent with the Bureau's prior estimates, the data suggest that credit unions may have sent less than one percent, and depositary institutions less than 10 percent, of the estimated total of 150 million international remittance transfers sent by money transmitters in 2013.

This final rule amends the current Remittance Rule by providing that remittance transfer providers may estimate exchange rates and covered third-party fees until July 21, 2020 (rather than July 21, 2015, as in the current Remittance Rule), if (1) the provider is an insured depository institution or credit union; (2) the remittance transfer is sent from the sender's account with the provider; and (3) the provider cannot determine the exact amounts for reasons outside of its control. 29 The analysis below considers the benefits, costs, and impacts of extending the exception against a baseline of allowing the exception to expire on July 21, 2015.

As the Bureau stated in its impact analysis in the April Proposal, relative to accurate disclosures, estimated disclosures strike a different balance between accuracy and access, potentially offering less accuracy but also potentially preserving greater access. 77 FR at 6274. The Bureau believes that extending the temporary exception may benefit those consumers who use insured institutions' remittance services because some of those services may otherwise be discontinued if the exception were to sunset on July 21, 2015. Specifically, the extension may benefit these consumers by preserving their current method of sending remittance transfers, particularly if alternatives are more expensive or less convenient, to the extent that such alternatives exist at all.

Extending the temporary exception may also provide benefits to consumers in the form of avoiding increased prices. This benefit depends on the extent to which providing exact information (as opposed to estimates) would require insured institutions or their service providers to take costly steps to provide that information, and the extent to which those institutions would then pass those costs to the consumers.

As stated above, the Bureau understands that disclosures containing estimates may be less accurate than those that disclose exact amounts. Disclosures that accurately reflect actual covered third-party fees and exchange rates may make it easier for a consumer to know whether a designated recipient is going to receive an intended sum of money, or the amount in U.S. dollars that the consumer must send to deliver a specific amount of foreign currency to a designated recipient. Extending the temporary exception may impose a cost on consumers in the form of these foregone benefits, if the estimated disclosures they receive from insured depository institutions and credit unions tend to deviate from the actual amount. Accurate disclosures may also make it easier for consumers to compare prices across providers. Accordingly, the Bureau believes there may be a cost associated with an extension of the temporary exception in that consumers may be less likely to engage in comparisons, if they believe that they cannot rely on estimated disclosures. However, as stated elsewhere in the preamble, the Bureau believes that the temporary exception is likely used in a small portion of all remittance transfers. To date, the Bureau is not aware of any evidence of abuse of the temporary exception; providers appear to use it only when necessary. Therefore, the Bureau believes that the overall costs to consumers of extending the temporary exception are not significant.

The information the Bureau has gathered with respect to how insured depository institutions and credit unions are, or are not, using the temporary exception, along with the Bureau's other efforts to understand industry's compliance with the requirements of the Remittance Rule, have provided the Bureau with a basis to determine that if the temporary exception were to sunset on July 21, 2015, its expiration would have a negative impact on the ability of insured institutions to send remittance transfers. The Bureau expects that extending the temporary exception to July 21, 2020, may benefit insured institutions that rely on the temporary exception to send remittance transfers by mitigating the negative impact of its earlier expiration. The Bureau believes that there may not be a cost to insured institutions of extending the exemption because it would not require them to alter current practices.

The Bureau understands that many insured institutions have already taken significant steps toward disclosing actual exchange rates and covered third-party fees when they believe they are able to do so. At the same time, the Bureau also understands that some small and some large insured institutions rely on the temporary exception for remittance transfers from accounts in which they believe covered third-party fee and/or exchange rate information are not readily available. Some of these institutions have indicated to the Bureau that they are unlikely to find an alternative to their reliance on the temporary exception by July 21, 2015, for at least some portion of the remittance transfers for which they currently use the temporary exception.

For insured institutions, the Bureau believes that a potential benefit associated with extending the temporary exception may come from preserving the segment of their business for which they rely on the temporary exception and for which they are unable to find a practical or cost-effective alternative. The Bureau acknowledges that the magnitude of this benefit is related to the overall significance of that particular segment of business for an insured institution and whether that institution uses the exception to estimate the disclosure of exchange rates or covered third-party fees (or both). With respect to the disclosure of exchange rates, the Bureau acknowledges that the magnitude of this benefit may be marginal because the exception's use for this purpose is limited. As for the disclosure of covered third-party fees, the Bureau believes that the benefit may be relatively greater to the extent that such estimation is more frequent.

An additional benefit of extending the temporary exception may be that it could provide additional time for insured institutions to search for efficient and cost-effective ways to disclose actual exchange rates and covered third-party fees in lieu of disclosing estimates. For instance, the Bureau believes that by 2020, insured institutions may develop more effective methods of communication between members of an open network that would allow for on-time verification of third-party fees and exchange rates.

The analysis below discusses the potential benefits and costs for consumers and covered persons that may result from clarifying that for purposes of the Remittance Rule: (1) Where a sender specifies that the funds will be received at a U.S. military installation that is physically located in a foreign country, a transfer will be considered as having been received in a State (and thus the Remittance Rule would not apply); (2) where a sender specifies that the funds will be received in an account that is located on a U.S. military installation abroad, the transfer will be considered as having been received in a State; and (3) a sender located on a U.S. military installation that is physically located in a foreign country is considered to be located in a State.

This clarification should not affect consumers who send remittance transfers to U.S. military installations located abroad using remittance transfer providers that currently treat such transfers as exempt from the Remittance Rule. As stated above, the Bureau understands that the majority of providers already treat transfers to U.S. military installations abroad in this manner. A smaller number of consumers who send transfers to U.S. military installations using providers who are providing disclosures in such instances may incur a cost, insofar as their provider currently applies the Remittance Rule to such transfers, but will no longer be required to do so in the light of this clarification. However, the Bureau believes this cost to be minimal, for the following reasons.

The Bureau believes that transfers to U.S. military installations located abroad share many of the characteristics of domestic transfers, and as such harbor less risk related to, for example, disclosures of fees, inaccuracies in exchange rates, and the timing of availability of funds, than a typical remittance transfer. A majority of commenters agree. Therefore, the benefit to consumers of the additional protections provided by the Remittance Rule for the affected transfers is likely to be insubstantial. Further, to the extent that some providers treated U.S. military installations abroad as being in a foreign location, consumers may also receive potential benefits from this clarification in the form of more consistent service across providers. Finally, consumers who send transfers from a U.S. military installation to a designated recipient in a foreign country will benefit from the protections of the rule including, for example, cancellation and error resolution rights, if previously those transfers were not subject to its requirements.

As the Bureau explained in the April Proposal, it believed that without clarification, there was a potential for confusion about whether the requirements of the Remittance Rule apply to remittance transfers sent to and from U.S. military installations located in foreign countries. Accordingly, the Bureau believes that this clarification may benefit remittance transfer providers by facilitating compliance without the added cost of determining how to interpret the Remittance Rule as it relates to transfers involving U.S. military installations. The Bureau understands that most remittance transfer providers currently treat U.S. military installations located in foreign countries as being located in States for the purposes of the Rule. Because this clarification is consistent with most providers' existing practices, the Bureau does not expect any material costs on covered persons. To the extent that certain providers have interpreted the Remittance Rule to require disclosures to consumers sending remittance transfers to U.S. military installations located in foreign countries, those providers will now benefit from the cost savings associated with being able to stop providing those disclosures. Conversely, there may be a cost to providers to the extent that previously they did not apply the rule to transfers sent from a U.S. military installation abroad to a designated recipient in a foreign country and now will have to apply the rule to those transfers.

The Remittance Rule only applies to transfers that are requested primarily for personal, family, or household purposes. This final rule clarifies that a remittance transfer provider may generally deem that the transfer is requested primarily for personal, family, or household purposes if the transfer is sent from an account that was established primarily for personal, family, or household purposes. The final rule also clarifies that a provider may deem that a transfer sent from a non-consumer account, such as a business account or account held by a financial institution under a bona fide trust agreement pursuant to § 1005.2(b)(3), as not being requested primarily for personal, family, or household purposes.

As discussed below, the Bureau believes that remittance transfer providers are currently treating transfers from non-consumer accounts as being outside the scope of the Remittance Rule, and transfers from consumer accounts as being within the scope of the rule. Thus, the Bureau does not foresee any material impact on the costs or benefits to consumers from the clarification.

The Bureau believes that remittance transfer providers are currently treating transfers from non-consumer accounts as being outside the scope of the Remittance Rule, and transfers from consumer accounts as being within the scope of the rule. Thus, the Bureau does not foresee any material impact on the costs or benefits to providers from the clarification. The Bureau also generally believes that it is less costly to determine whether a transfer is subject to the Rule on the account level than having to make a transfer-by-transfer determination of whether the Rule applies. To the extent that some covered persons are using the more costly transfer-by-transfer method to identify whether the Remittance Rule applies to a particular transfer and choose to change to this method, this final rule may reduce their compliance costs.

The Bureau is adopting several clarifications regarding the format of disclosures. First, the final rule clarifies that disclosures provided pursuant to § 1005.31 and § 1005.36 that are transmitted by fax may be considered a “writing” under the Remittance Rule. Second, the final rule permits providers to treat a written or electronic communication as an inquiry in cases where treating such communication as a request would be impractical. In response to such inquiries, the provider may provide pre-payment disclosures orally—but only when transactions are conducted orally and entirely by telephone. Third, this final rule specifies that remittance transfer providers may satisfy the requirement to disclose the Bureau's Web site on the receipts by listing either the Bureau's main Web page, or the Bureau's Web page that provides information about remittance transfers, or the Bureau's Web page in a language other than English, if it exists, insofar as a provider is making disclosures in that language pursuant to § 1005.31(g).

The Bureau believes that the clarification regarding the treatment of faxes is consistent with current practice. Thus, the Bureau does not believe that there are any material benefits or costs to consumers. The clarification regarding written or electronic inquiries is unlikely to create any material benefits or costs to consumers, because the Bureau believes that the clarification would conform the rule to providers' current practice. As the Bureau develops its Web page dedicated to remittance transfers, including creating Web pages in languages other than English, consumers may benefit from more direct access to these resources. The Bureau does not expect any material cost to consumers from this clarification.

The Bureau believes that to the extent remittance transfer providers already send disclosures via fax, they treat those faxes as a “writing.” Accordingly, the Bureau does not expect any material benefits or costs to covered persons.

As discussed above, the Bureau believes that the clarification regarding written or electronic inquiries would conform the rule to providers' current practice. Accordingly, the Bureau believes that the clarification would have minimal impact on covered persons. To the extent that it has any impact, the impact may be a positive one in that the clarification may benefit covered persons by clarifying that they have the option to respond to such inquiries orally if treating the communication as a request would be impractical. Further, because the clarification represents an option, but not a requirement, the Bureau does not believe that there will be material costs to covered persons, because it does not require a change in their current practices. The Bureau also does not believe that the clarification regarding Bureau's Web site will impose any material costs or benefits on covered persons. The clarification merely provides them with an option to display Bureau Web pages other than the Bureau's main Web site, but does not require a change in current practices.

The current Remittance Rule provides that a delay in relaying the funds is not an “error” if it is related to the remittance transfer provider's fraud screening procedures or in accordance with the Bank Secrecy Act, 31 U.S.C. 5311, et seq., Office of Foreign Assets Control requirements, or similar laws or requirements. This final rule clarifies that a delay does not constitute an “error” if such delay is related to the provider's or any third party's investigation necessary to address potentially suspicious, blocked or prohibited activity, and the provider did not have, and could not have reasonably obtained, sufficient information about the delay to enable it to timely disclose an accurate date of availability when providing the sender with a receipt or combined disclosure.

The Bureau believes that this clarification will benefit consumers who currently experience delays due to fraud screening procedures, insofar as remittance transfer providers have or could have reasonably obtained sufficient information about the delay to enable them to timely disclose an accurate date of availability. As discussed above, the Bureau expects that the clarification will lead to some providers adjusting their existing disclosure practices to ensure compliance with the final rule. The Bureau believes that the consumers who are the customers of these providers will benefit from more accurate disclosure of the date of availability. The Bureau does not foresee any material costs on consumers from this clarification.

This change to the Remittance Rule is a clarification of what the Bureau intended the rule to be in the first instance. (The Bureau is making this revision because the Bureau believes the original rule may have been unclear.) This change does not impose any material costs on those providers that already include delays due to fraud screening in their method of disclosing the date of availability of funds to recipient. Other providers may incur costs to make adjustments to their practices to ensure that they are complying with the Rule; however, these are only costs intended to bring the disclosure practices up to the intended understanding of the Remittance Rule, and do not constitute additional costs imposed by this final rule.

In cases of errors resulting from the sender providing incorrect or insufficient information, § 1005.33(c)(2)(iii) now explicitly states that a remittance transfer provider may not deduct its own fees from the amount refunded or applied to a new transfer. 30 This clarifies what was already required by the current Remittance Rule—a refund of the provider's own fee for errors that occur pursuant to § 1005.33(a)(1)(iv). Related to § 1005.33(c)(2)(iii), the Bureau is also adding an example to further explain how a remittance transfer provider should determine the appropriate amount to resolve any error under § 1005.33(a)(1)(iv).

The Bureau believes that there will be no material impact on consumers, because the Bureau believes that remittance transfer providers are not deducting their own fees when remedying an error pursuant to § 1005.33(a)(1)(iv) because the sender provided incorrect or insufficient information in connection with the transfer.

The Bureau believes that there will be no material benefits or costs on covered persons, because this final rule has simply clarified existing requirements under the rule that have been in place as of the effective date in October 2013.

The Bureau expects that the amendments adopted in this final rule will not decrease consumers' access to consumer financial products and services. On the contrary, by extending the temporary exception, the Bureau believes that this final rule may preserve consumers' current set of options for sending remittance transfers to destinations for which insured institutions rely on the temporary exception, compared to a market in which the temporary exception expires in July of 2015. The Bureau believes that there will not be a material impact of the technical corrections and clarifications of this final rule on consumer access to remittance transfer services.

As discussed above, the Bureau understands that with regard to remittance transfers sent from accounts, the majority of insured institutions that are remittance transfer providers obtain information about exchange rates and covered third-party fees from a limited number of service providers that are either very large insured institutions or large nonbank service providers. The Bureau believes that this applies to depository institutions and credit unions with $10 billion or less in total assets. Given that reliance, the nature of the impacts on these institutions is likely be similar to the effects on larger depository institutions.

In addition, the Bureau believes that the specific impacts of the extension of the temporary exception on depository institutions and credit unions depends on a number of factors, including whether such institutions are remittance transfer providers, the importance of remittance transfers for such institutions, the methods that such insured institutions use to send remittance transfers, and the number of institutions or countries to which they send remittance transfers. Information that the Bureau obtained during prior remittance rulemaking efforts, as well as data from the FFIEC and NCUA Call Reports, suggest that among depository institutions and credit unions that provide any remittance transfers, an institution's asset size and the number of remittance transfers sent by the institution are positively, though imperfectly, related. The Bureau therefore expects that among depository institutions and credit unions with $10 billion or less in total assets that provide any remittance transfers, compared to such larger institutions, a greater share will qualify for the safe harbor related to the definition of “remittance transfer provider” and therefore would be entirely unaffected by the proposed extension, because they are not subject to the requirements of the Remittance Rule. See § 1005.30(f)(2).

Senders in rural areas may experience different impacts from this final rule than other senders. The Bureau does not have data with which to analyze these impacts in detail. To the extent that the extension of the temporary exception impacts remittance transfer providers by allowing them to continue to provide remittance transfer services, this final rule may disproportionately benefit senders living in rural areas. Consumers in rural areas may have fewer options for sending remittance transfers, and therefore may benefit more than other consumers from a change that keeps more providers in the market. The Bureau does not expect that any of the other changes will have a material impact on consumers in rural areas.

The Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, requires each agency to consider the potential impact of its regulations on small entities, including small businesses, small governmental units, and small not-for-profit organizations. 31 The RFA defines a “small business” as a business that meets the size standard developed by the Small Business Administration pursuant to the Small Business Act. 32

The RFA generally requires an agency to conduct an initial regulatory flexibility analysis (IRFA) and a final regulatory flexibility analysis (FRFA) of any rule subject to notice-and-comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. 33 The Bureau also is subject to certain additional procedures under the RFA involving the convening of a panel to consult with small entity representatives prior to proposing a rule for which an IRFA is required. 34

The Bureau is certifying this final rule. A FRFA is not required for this rule because it will not have significant economic impact on a substantial number of small entities.

The analysis below evaluates the potential economic impact of this final rule on small entities as defined by the RFA. 35 This final rule applies to entities that satisfy the definition of “remittance transfer provider,” which is any person that provides remittance transfers for a consumer in the normal course of its business, regardless of whether the consumer holds an account with such person. See § 1005.30(f). 36 Potentially affected small entities include insured depository institutions and credit unions that have $550 million or less in assets and that provide remittance transfers in the normal course of their business, as well as non-depository institutions that have annual receipts that do not exceed $20.5 million and that provide remittance transfers in the normal course of their business. 37 With respect to the non-depository institutions, the affected small non-depository entities may include State-licensed money transmitters, broker-dealers, and other money transmission companies. 38 This analysis examines the benefits, costs, and impacts of the key provisions of this final rule relative to the baseline provided by the current Remittance Rule. The Bureau has discretion in future rulemakings to choose the most appropriate baseline for that particular rulemaking.

This final rule extends the temporary exception that permits insured institutions to provide estimated disclosures, instead of exact disclosures as is generally required under the Remittance Rule, under certain circumstances, from July 21, 2015, to July 21, 2020. The Bureau believes that the extension of the temporary exception would not impose a cost on any insured institutions, because the extension would not require them to alter current practices but instead maintain the status quo.

With regard to changes in this final rule concerning the treatment of transfers sent from consumer and non-consumer accounts, the treatment of faxes, when a provider may treat a communication regarding a potential remittance transfer as an inquiry, the Web site addresses to be disclosed on consumer receipts, and error resolution provisions related to delays and remedies, the Bureau does not believe that any of the provisions would have any material cost impact on any remittance transfer providers for the reasons stated in the Section 1022(b)(2) Analysis.

With respect to the provisions of this final rule concerning the treatment of U.S. military installations located in foreign countries for purposes of the Remittance Rule, the Bureau believes that remittance transfer providers that are small entities will not be significantly impacted, for the following reasons. This final rule clarifies that an account that is located on a U.S. military installation that is physically located in a foreign country is considered to be located in a State. It does not change the current Remittance Rule, insofar as the current rule does not contain specific guidance regarding how to treat such transfers. The final rule provides similar clarification with respect to transfers sent and received by senders (rather than from an account). The Bureau understands that many, if not most, servicemembers and other consumers stationed at U.S. military bases abroad opened their accounts in the United States. Accordingly, the Bureau believes that the impact on small insured institutions and credit unions that provide account-based transfers should be relatively limited, because this rule is not adjusting how transfers to and from those accounts are to be treated. For transfers to and from accounts located on a U.S. military installation abroad and for non-account based transfers, the Bureau believes that the impact will similarly be limited because the Bureau understands that the changes in the rule are largely in accordance with providers' current practice.

This final rule does not apply to credit transactions or to commercial remittances. Therefore, the Bureau does not expect this rule to increase the cost of credit for small businesses. With a few exceptions, this final rule generally does not change or lowers the cost of compliance for depositories and credit unions, many of which offer small business credit. Any effect of this final rule on small business credit, however, would be highly attenuated. This final rule also generally does not change or lowers the cost of compliance for money transmitters. Money transmitters typically do not extend credit to any entity, including small businesses.

Accordingly, the undersigned hereby certifies that this rule will not have a significant economic impact on a substantial number of small entities.

Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.) (PRA), the Bureau may not conduct or sponsor and, notwithstanding any other provision of law, a respondent is not required to respond to, an information collection unless the information collection displays a valid OMB control number. Regulation E, 12 CFR Part 1005, currently contains collections of information approved by OMB. The Bureau's OMB control number for Regulation E is 3170-0014.

As discussed elsewhere in this preamble, the Bureau solicited comments concerning the relative number of transfers sent to and from individuals and/or accounts located on U.S. military installations located in foreign countries and understands that remittance transfers to and from U.S. military installations abroad constitute a very small percentage of the overall remittance transfer market. Furthermore, the Bureau understands, and received comments to support the understanding, that remittance transfer providers currently treat such transfers as being within the United States, i.e., akin to domestic transfers not subject to the Remittance Rule. As such, the Bureau believes that remittance providers, in the ordinary course of their business, are in most instances already providing all applicable notices and disclosures required by this clarification, and therefore, there is no material change in burden of the previously identified information collections. Other changes required under this final rule do not affect information collection practices. Therefore, the Bureau does not believe that any of the changes adopted in this final rule will have a substantial impact on the Bureau's current collections of information pursuant to Regulation E approved by the Office of Management and Budget (OMB) under section 3507(d) of the PRA.

For the reasons set forth in preamble, the Bureau amends 12 CFR part 1005 to read as follows:

History

The Tri-Cities Airport, located in Pasco, WA, is the fourth largest air carrier airport in Washington State. In the past five years, the number of enplanements at the airport has increased by nearly 100,000 per year. To accommodate this unprecedented growth, the Port of Pasco is expanding the Tri-Cities Airport terminal to nearly double the size of the existing terminal. However, the terminal expansion project creates a proximity issue to one of the taxiways on the airfield (taxiway D) by aircraft that will push back from the gates at the expanded terminal, as well as encroaches into the PSC VOR 1,000 foot clear zone.

To resolve the terminal expansion proximity issue with taxiway D, approximately two thirds of the taxiway is being relocated to the northeast, away from the terminal, to establish a straight, parallel taxiway to runways 12/30 for the entire length of the taxiway. As a result of the portion of taxiway D effected by the terminal expansion being relocated, the new taxiway will run through the PSC VOR/DME site. To overcome the airport terminal expansion encroaching on the PSC VOR clear zone and, subsequently, the new taxiway D being relocated through the VOR/DME site, the NAVAID will be moved north 0.44 nautical miles, away from the airport terminal expansion and the taxiway relocation. Moving the PSC VOR/DME enables the NAVAID to be retained and continue providing ground-based navigation aid coverage for the existing VOR Federal airway segments it supports today.

Due to the PSC VOR/DME NAVAID being relocated, VOR Federal airway V-298 requires amendment action. The FAA is modifying this airway by changing the PSC VOR radial information used to identify the intersection point in the legal description using corrected radial information from the PSC VOR/DME in its new location. Since this action merely involves editorial changes in the legal descriptions of VOR Federal Airways, and does not involve a change in the dimensions or operating requirements of that airspace, notice and public procedure under 5 U.S.C. 553(b) are unnecessary.

The FAA is amending Title 14, Code of Federal Regulations (14 CFR) part 71 to modify VOR Federal airway V-298. The PSC VOR/DME relocation, due to the Tri-Cities Airport terminal expansion and taxiway D relocation projects, has made this action necessary. The route modification is outlined below.

V-298: V-298 extends between the Seattle, WA, VORTAC and Gillette, WY, VOR. This action modifies the route segment between the Yakima, WA, VORTAC and the PSC VOR/DME by changing the PSC radial used to describe the intersection between the two NAVAIDs from the Pasco 274° radial to the Pasco 273° radial. Additionally, this action removes reference to a south alternate airway designation previously deleted by regulatory action published in the Federal Register (48 FR 54829, December 7, 1983).

The navigation aid radials cited in this action are stated relative to True north.

Domestic VOR Federal airways are published in paragraph 6010(a) of FAA Order 7400.9Y dated August 6, 2014, and effective September 15, 2014, which is incorporated by reference in 14 CFR 71.1. The VOR Federal airway listed in this document would be subsequently published in the Order.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority.

This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies the route structure as necessary to preserve the safe and efficient flow of air traffic within the NAS.

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

History

The FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to amend VOR Federal airways V-6, V-30, V-126, V- 133, and V-416, and remove VOR Federal airway V-65 in the Sandusky, OH, area (79 FR 34453, June 17, 2014). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal. No comments were received.

The FAA is amending Title 14, Code of Federal Regulations (14 CFR) part 71 by modifying VOR Federal airways V-6, V-30, V-126, V-133, and V-416, and removing VOR Federal airway V-65 in the vicinity of Sandusky, OH. These airway modifications are necessary due to the Sandusky, OH, VOR/DME being decommissioned and the remaining ground-based navigation aid (NAVAID) coverage in the area being insufficient to enable the continuity of the affected airways. The route modifications are outlined below.

V-6: V-6 extends from the Oakland, CA, VOR Tactical Air Navigation (VORTAC) to the DuPage, IL, VOR/DME, and from the intersection of the Chicago Heights, IL, VORTAC 358° and Gipper, MI, VORTAC 271° radials (NILES fix) to the La Guardia, NY, VOR/DME. The route segment between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME is removed. Aircraft flying between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME will be routed using other existing adjacent airways.

V-30: V-30 extends from the Badger, WI, VORTAC to the Solberg, NJ, VOR/DME. The route segment between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME is removed. Aircraft flying between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME will be routed using other existing adjacent airways.

V-65: V-65 is removed.

V-126: V-126 extends from the intersection of the Peotone, IL, VORTAC 053° and Knox, IN, VOR/DME 297° radials (BEARZ fix) to the Stonyfork, PA, VOR/DME. The route segment between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME is removed. Aircraft flying between the Waterville, OH, VOR/DME and Dryer, OH, VOR/DME will be routed using other existing adjacent airways.

V-133: V-133 extends from the intersection of the Charlotte, NC, VOR/DME 305° and Barretts Mountain, NC, VOR/DME 197° radials (LINCO fix) to the Red Lake, ON, Canada (YRL), VOR/DME, excluding the airspace within Canada. The route segment between the Mansfield, OH, VORTAC and Salem, MI, VORTAC is removed. Aircraft flying between the Mansfield, OH, VORTAC and Salem, MI, VORTAC will be routed using other existing adjacent airways.

V-416: V-416 extends from the Rosewood, OH, VORTAC to the intersection of the Mansfield, OH, VORTAC 045° and Sandusky, OH, VOR/DME 107° radials (JAKEE fix). The JAKEE fix is redefined in its existing location using radials from the Mansfield, OH, VORTAC and Dryer, OH, VOR/DME.

The navigation aid radials cited in the VOR Federal airway descriptions in this action are stated relative to True north.

Domestic VOR Federal airways are published in paragraph 6010(a) of FAA Order 7400.9Y dated August 6, 2014, and effective September 15, 2014, which is incorporated by reference in 14 CFR 71.1. The VOR Federal airways listed in this document would be subsequently published in the Order.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority.

This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies the route structure as necessary to preserve the safe and efficient flow of air traffic within the NAS.

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

The Entity List (Supplement No. 4 to Part 744) notifies the public about entities that have engaged in activities that could result in an increased risk of the diversion of exported, reexported or transferred (in-country) items to weapons of mass destruction (WMD) programs. Since its initial publication, grounds for inclusion on the Entity List have expanded to include activities sanctioned by the State Department and activities contrary to U.S. national security or foreign policy interests. Certain exports, reexports, and transfers (in-country) to entities identified on the Entity List require licenses from BIS and are usually subject to a policy of denial. The availability of license exceptions in such transactions is very limited. The license review policy for each entity is identified in the license review policy column on the Entity List and the availability of license exceptions is noted in the Federal Register notices adding persons to the Entity List. BIS places entities on the Entity List based on certain sections of part 744 (Control Policy: End-User and End-Use Based) of the EAR.

The End-user Review Committee (ERC), composed of representatives of the Departments of Commerce (Chair), State, Defense, Energy and, where appropriate, the Treasury, makes all decisions regarding additions to, removals from, or other modifications to the Entity List. The ERC makes all decisions to add an entry to the Entity List by majority vote and all decisions to remove or modify an entry by unanimous vote.

This rule implements the decision of the ERC to add twenty-eight persons under thirty-four entries to the Entity List. These twenty-eight persons are being added on the basis of § 744.11 (License requirements that apply to entities acting contrary to the national security or foreign policy interests of the United States) of the EAR. There are thirty-four entries for twenty-eight persons because two persons are listed under multiple countries, resulting in six additional entries. The thirty-four entries added to the Entity List consist of one entry in Afghanistan, one entry in Armenia, one entry in Australia, one entry in China, two entries in Greece, five entries in Hong Kong, one entry in India, one entry in Ireland, nine entries in Pakistan, one entry in Singapore, ten entries in the U.A.E., and one entry in the U.K.

The ERC reviewed § 744.11(b) (Criteria for revising the Entity List) in making the determination to add these twenty-eight persons to the Entity List. Under that paragraph, persons for whom there is reasonable cause to believe, based on specific and articulable facts, have been involved, are involved, or pose a significant risk of being or becoming involved in, activities that are contrary to the national security or foreign policy interests of the United States and those acting on behalf of such persons may be added to the Entity List. Paragraphs (b)(1) through (b)(5) of § 744.11 include an illustrative list of activities that could be contrary to the national security or foreign policy interests of the United States.

The twenty-eight persons being added have been determined by the ERC to be involved in activities that are contrary to the national security or foreign policy interests of the United States, including the activities described under paragraphs (b)(1), (b)(2) and (b)(5) of § 744.11.

The ERC determined that nine of the persons being added to the Entity List under the destinations of Australia (one addition), Hong Kong (one addition), Pakistan (six additions), and Singapore (one addition) have been involved in activities contrary to the national security and foreign policy interests of the United States. Specifically, the ERC determined to add Pakistan's Advanced Engineering Research Organization (AERO) and entities working with AERO to the Entity List for their involvement in activities contrary to the national security and foreign policy interests of the United States related to the illicit export, reexport and transfer (in-country) of items subject to the EAR to unauthorized end users in Pakistan as described in § 744.11(b)(5) of the EAR. These entities' involvement in the procurement of sensitive U.S. technology in support of Pakistan's development of its missile and strategic unmanned aerial vehicle (UAV) programs is in violation of § 744.3 of the EAR, which requires a license to export, reexport or transfer (in-country) any item subject to the EAR that the exporter, reexporter, or in-country transferor knows will be used in the design, development, production or use of rocket systems by a country listed in the EAR's Country Group D:4 in Supplement No. 1 to part 740, in which Pakistan is included.

Since 2010, Pakistan's AERO has used intermediaries and front companies to procure U.S.-origin items by disguising the end-uses and end-users of the items from U.S. exporters thereby circumventing BIS licensing requirements. The intermediaries used by AERO have included Beijing Lion Heart International Trading Company (a.k.a., Wei Lai Xi Tong Ltd.); Izix Group Pte Ltd.; Future Systems Pvt. Ltd.; IKAN Engineering Services (a.k.a., IKAN Sourcing); Orion Eleven Pvt. Ltd.; Nazir and Sons International; LT Engineering and Trade Services (Pvt) Ltd. (LTE); and Vortex Electronics. AERO has procured items on behalf of Pakistan's Air Weapons Complex, a Pakistani government entity responsible for Pakistan's cruise missile and strategic UAV programs.

The ERC determined that four of the persons being added to the Entity List under the destination of Hong Kong have been involved in activities contrary to the national security and foreign policy interests of the United States. Specifically, the ERC made a determination to add Channel Rich Electronics Company Limited (Channel Rich) and Fortune Source Electronics Co. Ltd. (Fortune Source) and their employees, Sau Luen Chan (Chan) and Bako Cheung (Cheung), to the Entity List for their involvement in activities contrary to the national security and foreign policy interests of the United States as described in § 744.11(b)(5) of the EAR. Specifically, Cho-Man Wong (Wong), the owner of Channel Rich and Fortune Source, was placed on the Entity List along with Hang Tat Electronics (Hang Tat), a company owned by Wong, on October 12, 2011 for purchasing items subject to the EAR with the intention of reselling them to end-users in China without proper BIS authorization ( see 76 FR 63184). Subsequent to Hang Tat's addition to the Entity List, Wong changed the name of Hang Tat to Channel Rich and then to Fortune Source to continue to receive U.S.-origin items and to evade BIS licensing requirements. Chan and Cheung, the two employees, actively informed supplier companies of the name changes.

The ERC made a determination to add Mohammad Jan Mangal Construction Company to the Entity List under the destination of Afghanistan for involvement in activities contrary to the national security and foreign policy interests of the United States as described under § 744.11(b)(1) of the EAR. This entity has engaged in activities in support of persons designated by the Secretary of State as a Foreign Terrorist Organization (FTO). The persons designated as FTOs were so designated as a result of their activities against U.S. and coalition forces in Afghanistan contrary to the national security and foreign policy of the United States.

The ERC made a determination to add Rayyan Air Pvt Ltd., Veteran Avia LLC, Aerospace One, S.A., Agneet Sky Limited, Aeolus FZE, Aerospace Company FZE, Aircon Beibars FZE, and Aristeidis A. Pappas to the Entity List to prevent these entities from engaging in activities that are contrary to the national security and foreign policy interests of the United States as described under § 744.11(b)(5) of the EAR. Specifically, these companies owned, operated, or controlled by Jaideep Mirchandani (Mirchandani) and his family members, Indira Mirchandani and Nitin Mirchandani, have been involved in activities in support of the Syrian regime. In addition, Mirchandani and certain other entities were attempting to export a U.S. aircraft that would be used to further support the Syrian regime.

Specifically, Rayyan Air and affiliated companies and enterprises owned, operated and/or controlled by Jaideep Mirchandani and members of his family have supported flights into Syria in support of the Assad regime. These flights transported large amounts of Russian currency to the Syrian Government. Additionally, the Mirchandanis and their corporate officers/employees have engaged in transactions with individuals involved in weapons trafficking as well as individuals and companies named on the U.S. Treasury's Specially Designated Nationals (SDNs) list, including Mahan Air of Iran and its affiliates. Persons designated as SDNs were so designated for supporting the terrorist activities of the Islamic Revolutionary Guard Corps-Qods Force.

The ERC made a determination to add Reza Ghoreishi to the Entity List under the destination of the U.A.E. on the basis of his involvement in activities contrary to the national security and foreign policy of the United States as described under § 744.11(b)(2) of the EAR. Specifically, this person was involved in the attempted export of a lathe machine, an item used in the production of high grade steel or “bright steel,” an item used, among other things, in the manufacture of automobile and aircraft parts destined to Iran in violation of Department of the Treasury, Office of Foreign Assets Control regulations and the EAR.

The ERC made a determination to add Irum Mehboob Raja under the destination of Pakistan to the Entity List to prevent the export, reexport and transfer (in-country) of U.S.-origin items to unauthorized end users in Pakistan contrary to § 744.11(a) and (b)(5) of the EAR. The ERC determined that Irum, as well as National Institute of Lasers and Optronics (NILOP) described below under the modifications to the Entity List, procured items, including U.S.-origin items, for, or on behalf of, Pakistan's Atomic Energy Commission (PAEC), an entity on the Entity List, and its subordinate organization Pakistan Institute of Nuclear Science and Technology, which is included in PAEC's entry on the Entity List.

Pursuant to § 744.11(b)(1), (b)(2) and (b)(5) of the EAR, the ERC determined that the conduct of these twenty-eight persons raises sufficient concern that prior review of exports, reexports, or transfers (in-country) of items subject to the EAR involving these persons, and the possible imposition of license conditions or license denials on shipments to the persons, will enhance BIS's ability to prevent violations of the EAR.

For twenty-seven of the twenty-eight persons recommended for addition on the basis of § 744.11, the ERC specified a license requirement for all items subject to the EAR and a license review policy of presumption of denial. For Irum Mehboob Raja, the ERC specified a license requirement for all items subject to the EAR and a license review policy of case-by-case for all items listed on the CCL and a presumption of approval for EAR99 items, the same as the existing licensing policy for PAEC entities on the Entity List. The license requirements apply to any transaction in which items are to be exported, reexported, or transferred (in-country) to any of the persons or in which such persons act as purchaser, intermediate consignee, ultimate consignee, or end-user. In addition, no license exceptions are available for exports, reexports, or transfers (in-country) to the persons being added to the Entity List in this rule.

This final rule adds the following twenty-eight persons under thirty-four entries to the Entity List:

(1) Mohammad Jan Mangal Construction Company (MMCC), Kolola Pushta, Charahi Gul-e-Surkh, Kabul, Afghanistan; and Maidan Sahr, Hetefaq Market, Paktiya, Afghanistan.

(1) Veteran Avia LLC, a.k.a., the following one alias:

(1) Vortex Electronics, 125 Walker Street, Quakers Hill, NSW 2763, Australia.

(1) Beijing Lion Heart International Trading Company, a.k.a., the following one alias:

(1) Aerospace One, S.A., 4 Andrea Koumpi Str. Markopoulo19003 Attica, Greece; and

(2) Veteran Avia LLC, a.k.a., the following one alias:

(1) Bako Cheung,

(2) Beijing Lion Heart International Trading Company, a.k.a., the following one alias:

(3) Channel Rich Electronics Company Limited,

(4) Fortune Source Electronics Co. Ltd., Unit A, 7/F Capri Building, 130 Austin Road, KLN, Hong Kong; and Unit A7/F Capri Building, 130 Austin Road, KLN, Hong Kong; and Unit 803, Fourseas Building, 208-212 Nathan Road, Kowloon, Hong Kong; and

(5) Sau Luen Chan, Unit 803, Fourseas Building, 208-212 Nathan Road, Kowloon, Hong Kong; and Room 803, Fourseas Bldg 208-212 Nathan Rd, Kowloon, Hong Kong.

(1) Veteran Avia LLC, a.k.a., the following one alias:

(1) Agneet Sky Limited, 12, Fitzwilliam Place Dublin, 2 Ireland.

(1) Advanced Engineering Research Organization (AERO), Lub Thatoo Hazara Road, The Taxila district, Rawalpindi, Pakistan;

(2) Future Systems Pvt. Ltd., 10 Main Double Road F11/3, Islamabad, Pakistan;

(3) IKAN Engineering Services, a.k.a., the following one alias:

(4) Irum Mehboob Raja, Pakistan Institute of Nuclear Science and Technology (PINSTECH), Nilore, Islamabad, Pakistan;

(5) LT Engineering and Trade Services (Pvt) Ltd. (LTE), Lub Thatoo, Abbotabad Road, Hasan Abdal, Pakistan; and 30 Nazimud din Road, F-10/4, Islamabad, Pakistan;

(6) Nazir and Sons International, 2nd Floor, Pracha Plaza, Near Municipal Committee Office Road, Taxila, Pakistan;

(7) Orion Eleven Pvt. Ltd., Street 11 Valley Road, Westridge Rawalpindi, Pakistan;

(8) Rayyan Air Pvt Ltd., House No 614, Street No 58 I-8/2 Islamabad, Pakistan; and Office No 456, K Street No 57 I-8/3 Islamabad, Pakistan; and

(9) Veteran Avia LLC, a.k.a., the following one alias:

(1) Izix Group Pte Ltd., Number 26 Defu Lane 9, Singapore 539267; and 50 Bukit Batok Street, 23 #07-08 Midview Building, Singapore 659578.

(1) Aeolus FZE, a.k.a., the following one alias:

(2) Aerospace Company FZE, a.k.a., the following one alias:

(3) Aircon Beibars FZE, Plot of Land L4—03, 04, 05, 06, P.O. Box 121095, Sharjah, U.A.E.;

(4) Aristeidis A. Pappas, Villa D71, Al Hamra Village, Ras Al Khaimah, U.A.E.;

(5) Group Sky One, a.k.a., the following one alias:

(6) Indira Mirchandani, Town House 1033 Uptown Mirdif, Mirdif, Algeria Street, Dubai, U.A.E.;

(7) Jaideep Mirchandani, a.k.a., the following one alias:

(8) Nitin Mirchandani, a.k.a., the following one alias:

(9) Reza Ghoreishi, P.O. Box 61342, Jebel Ali, U.A.E.; and

(10) Veteran Avia LLC, a.k.a., the following one alias:

(1) Veteran Avia LLC, a.k.a., the following one alias:

This final rule implements a decision of the ERC to modify two existing entries on the Entity List. The first entry, for Cho-Man Wong , is listed under Hong Kong. The ERC made a determination to add two additional addresses for this person. The second entry, for Pakistan Atomic Energy Commission (PAEC), is listed under Pakistan. The ERC made a determination to add one additional subordinate entity to the entry. The additional subordinate entity will be subject to the same Entity List-based license requirements applicable to the other persons in this entity. Specifically, the ERC made a determination to add the National Institute of Lasers and Optronics (NILOP) to the Entity List to prevent the export, reexport and transfer (in-country) of U.S.-origin items to unauthorized end users in Pakistan contrary to § 744.11(a) of the EAR. See also the information provided above on Irum Mahboob Raja: The ERC determined that NILOP and Irum procured items, including U.S.-origin items, for, or on behalf of, Pakistan's Atomic Energy Commission (PAEC), an entity on the Entity List, and its subordinate organization Pakistan Institute of Nuclear Science and Technology, which is included in PAEC's entry on the Entity List.

This final rule makes the following modifications to two persons on the Entity List:

(1) Cho-Man Wong, Room 2608, Technology Plaza 29-35 Sha Tsui Road Tsuen Wan, Hong Kong; and Unit 803, Fourseas Building, 208-212 Nathan Road, Kowloon, Hong Kong; and Room 803, Fourseas Bldg 208-212 Nathan Rd, Kowloon, Hong Kong.

(1) Pakistan Atomic Energy Commission (PAEC), a.k.a., the following one alias:

This rule implements a decision of the ERC to remove three persons, Bruce Lam, Creative Electronics and United Sources Industrial Enterprises, all located in Hong Kong, from the Entity List. The three persons removed were determined to no longer meet the criteria for inclusion on the Entity List.

United Sources Industrial Enterprises was added to General Order No. 3 in Supplement No. 1 to part 736 of the EAR on June 8, 2007, due to its involvement in transactions involving Mayrow General Trading (“Mayrow”) (72 FR 31716) and was subsequently added to the Entity List when the entities identified in General Order No. 3 were added to the Entity List on September 22, 2008 (73 FR 54499). Bruce Lam and Creative Electronics were also added to the Entity List on September 22, 2008 (73 FR 54499) for the same reasons that United Sources Industrial Enterprises was added to the Entity List. These entities have reached agreements with BIS that include measures protecting U.S. national security and foreign policy interests. In light of the content of these agreements, the ERC deemed it no longer necessary to impose licensing requirements pursuant to § 744.11 on the three entities.

This final rule implements the decision to remove the following three persons located in Hong Kong from the Entity List:

(1) Bruce Lam, 11/F Excelsior Bldg., 68-76, Sha Tsui Rd., Tsuen Wan, New Territories, Hong Kong;

(2) Creative Electronics, Room 2202c, 22/F, Nan Fung Centre, 264-298 Castle Peak Road, Hong Kong and G/F 1_J Wong Chuk Street Shamshuipo, Kowloon, Hong Kong; and

(3) United Sources Industrial Enterprises, 11/F, Excelsior Building, 68-76 Sha Tsui Road, Hong Kong.

The removal of the three entities referenced above, which was approved by the ERC, eliminates the existing license requirements in Supplement No. 4 to part 744 for exports, reexports and transfers (in-country) to these entities. However, the removal of these entities from the Entity List does not relieve persons of other obligations under part 744 of the EAR or under other parts of the EAR. Neither the removal of an entity from the Entity List nor the removal of Entity List-based license requirements relieves persons of their obligations under General Prohibition 5 in § 736.2(b)(5) of the EAR which provides that, “you may not, without a license, knowingly export or reexport any item subject to the EAR to an end-user or end-use that is prohibited by part 744 of the EAR.” Additionally this removal does not relieve persons of their obligation to apply for export, reexport or in-country transfer licenses required by other provisions of the EAR. BIS strongly urges the use of Supplement No. 3 to part 732 of the EAR, “BIS's `Know Your Customer' Guidance and Red Flags,” when persons are involved in transactions that are subject to the EAR.

Shipments of items removed from eligibility for a License Exception or export or reexport without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export or reexport, on September 18, 2014, pursuant to actual orders for export or reexport to a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export or reexport without a license (NLR).

Although the Export Administration Act expired on August 20, 2001, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013) and as extended by the Notice of August 7, 2014, 79 FR 46959 (August 11, 2014), has continued the Export Administration Regulations in effect under the International Emergency Economic Powers Act. BIS continues to carry out the provisions of the Export Administration Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222.

1. Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been determined to be not significant for purposes of Executive Order 12866.

2. Notwithstanding any other provision of law, no person is required to respond to nor be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This regulation involves collections previously approved by OMB under control number 0694-0088, Simplified Network Application Processing System, which includes, among other things, license applications and carries a burden estimate of 43.8 minutes for a manual or electronic submission. Total burden hours associated with the PRA and OMB control number 0694-0088 are not expected to increase as a result of this rule. You may send comments regarding the collection of information associated with this rule, including suggestions for reducing the burden, to Jasmeet K. Seehra, Office of Management and Budget (OMB), by email to Jasmeet_K._Seehra@omb.eop.gov, or by fax to (202) 395-7285.

3. This rule does not contain policies with Federalism implications as that term is defined in Executive Order 13132.

4. For the twenty-eight persons added under thirty-four entries to the Entity List in this final rule and the modifications to the existing entries on the Entity List, the provisions of the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, the opportunity for public comment and a delay in effective date are inapplicable because this regulation involves a military or foreign affairs function of the United States. ( See 5 U.S.C. 553(a)(1)). BIS implements this rule to protect U.S. national security or foreign policy interests by preventing items from being exported, reexported, or transferred (in-country) to the persons being added to or the entries being modified on the Entity List. If this rule were delayed to allow for notice and comment and a delay in effective date, then entities being added to the Entity List by this action would continue to be able to receive items without a license and to conduct activities contrary to the national security or foreign policy interests of the United States. For the entities whose entries on the Entity List are being modified, allowing for notice and comment and a delay in the effective date would allow for continued transactions involving an additional address for a person already listed on the Entity List or for the continued procurement of items for an entity on the Entity List. In addition, because these parties may receive notice of the U.S. Government's intention to place these entities on the Entity List if a proposed rule is published, doing so would create an incentive for these persons to either accelerate receiving items subject to the EAR to conduct activities that are contrary to the national security or foreign policy interests of the United States, or to take steps to set up additional aliases, change addresses, and other measures to try to limit the impact of the listing on the Entity List once a final rule was published. Further, no other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this rule. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule by 5 U.S.C. 553, or by any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., are not applicable. Accordingly, no regulatory flexibility analysis is required and none has been prepared.

5. For the three removals from the Entity List in this final rule, pursuant to the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(3)(B), BIS finds good cause to waive requirements that this rule be subject to notice and the opportunity for public comment because it would be contrary to the public interest.

In determining whether to grant removal requests from the Entity List, a committee of U.S. Government agencies (the End-user Review Committee (ERC)) evaluates information about and commitments made by listed persons requesting removal from the Entity List, the nature and terms of which are set forth in 15 CFR part 744, Supplement No. 5, as noted in 15 CFR 744.16(b). The information, commitments, and criteria for this extensive review were all established through the notice of proposed rulemaking and public comment process (72 FR 31005 (June 5, 2007) (proposed rule), and 73 FR 49311 (August 21, 2008) (final rule)). These three removals have been made within the established regulatory framework of the Entity List. If the rule were to be delayed to allow for public comment, U.S. exporters may face unnecessary economic losses as they turn away potential sales because the customer remained a listed person on the Entity List even after the ERC approved the removal pursuant to the rule published at 73 FR 49311 on August 21, 2008. By publishing without prior notice and comment, BIS allows the applicant to receive U.S. exports immediately since these three applicants already have received approval by the ERC pursuant to 15 CFR part 744, Supplement No. 5, as noted in 15 CFR 744.16(b).

The removals from the Entity List granted by the ERC involve interagency deliberation and result from review of public and non-public sources, including sensitive law enforcement information and classified information, and the measurement of such information against the Entity List removal criteria. This information is extensively reviewed according to the criteria for evaluating removal requests from the Entity List, as set out in 15 CFR part 744, Supplement No. 5 and 15 CFR 744.16(b). For reasons of national security, BIS is not at liberty to provide to the public detailed information on which the ERC relied to make the decision to remove these entities. In addition, the information included in the removal requests is information exchanged between the applicant and the ERC, which by law (section 12(c) of the Export Administration Act), BIS is restricted from sharing with the public. Moreover, the removal requests from the Entity List contain confidential business information, which is necessary for the extensive review conducted by the U.S. Government in assessing such removal requests.

Section 553(d) of the APA generally provides that rules may not take effect earlier than thirty (30) days after they are published in the Federal Register . BIS finds good cause to waive the 30-day delay in effectiveness under 5 U.S.C. 553(d)(1) because this rule is a substantive rule which relieves a restriction. This rule's removal of three persons from the Entity List removes a requirement (the Entity-List-based license requirement and limitation on use of license exceptions) on these three persons being removed from the Entity List. The rule does not impose a requirement on any other person for these three removals from the Entity List.

No other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this final rule. Because a notice of proposed rulemaking and an opportunity for public comment are not required under the APA or by any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) are not applicable. As a result, no final regulatory flexibility analysis is required and none has been prepared.

Accordingly, part 744 of the Export Administration Regulations (15 CFR parts 730-774) is amended as follows:

In accordance with section 513(f)(1) of the Federal Food, Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 360c(f)(1)), devices that were not in commercial distribution before May 28, 1976 (the date of enactment of the Medical Device Amendments of 1976), generally referred to as postamendments devices, are classified automatically by statute into class III without any FDA rulemaking process. These devices remain in class III and require premarket approval, unless and until the device is classified or reclassified into class I or II, or FDA issues an order finding the device to be substantially equivalent, in accordance with section 513(i) of the FD&C Act, to a predicate device that does not require premarket approval. The Agency determines whether new devices are substantially equivalent to predicate devices by means of premarket notification procedures in section 510(k) of the FD&C Act (21 U.S.C. 360(k)) and part 807 (21 CFR part 807) of the regulations.

Section 513(f)(2) of the FD&C Act, as amended by section 607 of the Food and Drug Administration Safety and Innovation Act (Pub. L. 112-144), provides two procedures by which a person may request FDA to classify a device under the criteria set forth in section 513(a)(1). Under the first procedure, the person submits a premarket notification under section 510(k) of the FD&C Act for a device that has not previously been classified and, within 30 days of receiving an order classifying the device into class III under section 513(f)(1) of the FD&C Act, the person requests a classification under section 513(f)(2). Under the second procedure, rather than first submitting a premarket notification under section 510(k) and then a request for classification under the first procedure, the person determines that there is no legally marketed device upon which to base a determination of substantial equivalence and requests a classification under section 513(f)(2) of the FD&C Act. If the person submits a request to classify the device under this second procedure, FDA may decline to undertake the classification request if FDA identifies a legally marketed device that could provide a reasonable basis for review of substantial equivalence with the device or if FDA determines that the device submitted is not of “low-moderate risk” or that general controls would be inadequate to control the risks and special controls to mitigate the risks cannot be developed.

In response to a request to classify a device under either procedure provided by section 513(f)(2) of the FD&C Act, FDA will classify the device by written order within 120 days. This classification will be the initial classification of the device.

In accordance with section 513(f)(1) of the FD&C Act, FDA issued an order on January 3, 2012, classifying the ImmunoCAP Tryptase into class III, because it was not substantially equivalent to a device that was introduced or delivered for introduction into interstate commerce for commercial distribution before May 28, 1976, or a device which was subsequently reclassified into class I or class II. On January 12, 2013, Phadia U.S., Inc. submitted a request for de novo classification of the ImmunoCAP Tryptase under section 513(f)(2) of the FD&C Act. The manufacturer recommended that the device be classified into class II.

In accordance with section 513(f)(2) of the FD&C Act, FDA reviewed the request for de novo classification in order to classify the device under the criteria for classification set forth in section 513(a)(1). FDA classifies devices into class II if general controls by themselves are insufficient to provide reasonable assurance of safety and effectiveness, but there is sufficient information to establish special controls to provide reasonable assurance of the safety and effectiveness of the device for its intended use. After review of the information submitted in the request, FDA determined that the device can be classified into class II with the establishment of special controls. FDA believes these special controls, in addition to general controls, will provide reasonable assurance of the safety and effectiveness of the device.

The device is assigned the generic name tryptase test system, and it is identified as a device that aids in the diagnosis of systemic mastocytosis. It is intended for in vitro diagnostic use as an aid in the clinical diagnosis of patients with a suspicion of systemic mastocytosis in conjunction with other clinical and laboratory findings.

FDA has identified the following risks to health associated with this type of device and the measures required to mitigate these risks in Table 1:

FDA believes that the measures set forth in the special controls guideline entitled “Class II Special Controls Guideline: Tryptase Test System as an Aid in the Diagnosis of Systemic Mastocytosis” are necessary, in addition to general controls, to mitigate the risks to health described in table 1.

Therefore, on February 15, 2012, FDA issued an order to the petitioner classifying tryptase test system devices into class II. FDA is codifying this device type by adding § 866.5760.

Following the effective date of this final classification order, any firm submitting a 510(k) premarket notification for this device type will need to comply with the special controls.

Section 510(m) of the FD&C Act provides that FDA may exempt a class II device from the premarket notification requirements under section 510(k) of the FD&C Act if FDA determines that premarket notification is not necessary to provide reasonable assurance of the safety and effectiveness of the device. For this type of device, FDA has determined that premarket notification is necessary to provide reasonable assurance of the safety and effectiveness of the device. Therefore, this type of device is not exempt from premarket notification requirements. Persons who intend to market this type of device must submit to FDA a premarket notification, prior to marketing the device, which contains information about the tryptase test system they intend to market.

The Agency has determined under 21 CFR 25.34(b) that this action is of type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

This final administrative order establishes special controls that refer to previously approved collections of information found in other FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in part 807, subpart E, regarding premarket notification submissions have been approved under OMB control number 0910-0120; the collections of information in 21 CFR part 820 have been approved under OMB control number 0910-0073; and the collections of information in 21 CFR part 801 and 21 CFR 809.10 have been approved under OMB control number 0910-0485.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, 21 CFR part 866 is amended as follows:

Table of Acronyms DHS Department of Homeland Security FR Federal Register NPRM Notice of Proposed Rulemaking TFR Temporary Final Rule IJSBA International Jet Sports Boating Association A. Regulatory History and Information

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.”

Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because an NPRM would be impracticable. Logistical details did not present the Coast Guard enough time to draft, publish, and receive public comment on an NPRM. As such, the event would occur before the rulemaking process was complete. Immediate action is needed to help protect the safety of the participants, crew, spectators, and participating vessels from other vessels during the duration of this event.

Under 5 U.S.C. 553(d)(3), for the same reasons mentioned above, the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Any delay in the effective date of this rule would be contrary to the public interest, because immediate action is necessary to protect the safety of the participants from the dangers associated with other vessels transiting this area while the race occurs.

The legal basis and authorities for this rule are found in 33 U.S.C. 1231, 46 U.S.C. Chapter 701, 3306, 3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Public Law 107-295, 116 Stat. 2064; and Department of Homeland Security Delegation No. 0170.1, which collectively authorize the Coast Guard to propose, establish, and define regulatory safety zones.

IJSBA is sponsoring the IJSBA World Finals, which will involve approximately 800 personal water craft, 5 to 13 feet in length. The safety zone will encompass an area in the vicinity of the Crazy Horse Campgrounds. This temporary safety zone is necessary to provide for the safety of the participants, crew, spectators, sponsor vessels, other vessels, and users of the waterway, specifically in minimizing vessel wakes by transiting vessels in the vicinity of the racing area. Unnecessary wakes can disrupt the personal water craft and could cause injury or damage to the participants.

The Coast Guard is establishing a safety zone that will be enforced from 6:30 a.m. to 6:30 p.m. on October 4, 2014 through October 12, 2014. The effect of the temporary safety zone will be to restrict navigation in the vicinity of the race site until the conclusion of the races. The limits of the safety zone will encompass the waters of Lake Havasu, AZ in the area of Crazy Horse Campgrounds encompassed by the following positions:

The safety zone is necessary to provide for the safety of the crew, spectators, participants, and other vessels and users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within this safety zone unless authorized by the Captain of the Port, or his designated representative, during the proposed times. Before the effective period, the Coast Guard will publish a local notice to mariners (LNM). Also, the event sponsor through Lake Havasu City has extensively advertised the marine event with the public.

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders. We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation is unnecessary. This determination is based on the size, location, and the limited duration of the safety zone. Additionally, to the maximum extent practicable, the event sponsor will assist with the movement of boaters desiring to transit the racing area during non-racing times.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: the owners or operators of vessels intending to transit or anchor in the impacted portion of Lake Havasu from 6:30 a.m. to 6:30 p.m. on October 4, 2014 through October 12, 2014.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons. The safety zone applies to a small area in the vicinity of the Crazy Horse Campground and boating traffic would still be allowed to pass through the safety zone with Captain of the Port approval. The event sponsor will to their maximum extent assist boaters wishing to transit the racing area during non-racing times.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT , above.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has 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. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves establishment of a safety zone on the navigable waters of Lake Havasu. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES . We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

Table of Acronyms DHS Department of Homeland Security FR Federal Register NPRM Notice of Proposed Rulemaking TFR Temporary Final Rule A. Regulatory History and Information

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because an NPRM would be impracticable. Logistical details did not present the Coast Guard enough time to draft, publish, and receive public comment on an NPRM. As such, the event would occur before the rulemaking process was complete. Immediate action is needed to help protect the safety of the swimmers, crew, spectators, and participating vessels from other vessels during this one day event.

The legal basis and authorities for this rule are found in 33 U.S.C. 1231, 46 U.S.C. Chapter 701, 3306, 3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Public Law 107-295, 116 Stat. 2064; and Department of Homeland Security Delegation No. 0170.1, which collectively authorize the Coast Guard to propose, establish, and define regulatory safety zones. The event will consist of 2,000 participants swimming a 1.5 KM course within Oceanside Harbor. The course starts at the Oceanside Harbor public boat launch, proceeds to the outer point of the submerged jetty, and back to the boat launch. A safety zone is established to protect the swimmers and assist with vessel traffic management.

The Coast Guard is establishing a safety zone that will be enforced from 6:30 a.m. to 9:30 a.m. on October 26, 2014. The safety zone includes the waters of Oceanside Harbor encompassed by drawing a line from point to point along the following coordinates:

The safety zone is necessary to provide for the safety of swimmers, crew, rescue personnel, and other users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within the safety zone unless authorized by the Captain of the Port, or his designated representative. Immediately before and during the swimming event, Coast Guard Sector San Diego Joint Harbor Operations Center will issue Broadcast Notice to Mariners on the location and enforcement of the safety zone.

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders. We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation is unnecessary. This determination is based on the safety zone being of a limited duration, three hours, and is also limited to a relatively small geographic area in Oceanside Harbor.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: the owners or operators of vessels intending to transit or anchor in the impacted portion of the Oceanside Harbor from 6:30 a.m. to 9:30 a.m. on October 26, 2014.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons. The safety zone will only be in effect for three hours in the morning when vessel traffic is low. Vessel traffic can safely transit around the safety zone while the zone is in effect with the permission of the Captain of the Port.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT , above.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has 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. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves establishment of a safety zone on the navigable waters in Oceanside Harbor. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES . We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because an NPRM would be impracticable. Logistical details did not present the Coast Guard enough time to draft, publish, and receive public comment on an NPRM. As such, the event would occur before the rulemaking process was complete. Immediate action is needed to help protect the safety of the swimmers, crew, spectators, and participating vessels from other vessels during this one day event.

Under 5 U.S.C. 553(d)(3), for the same reasons mentioned above, the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Any delay in the effective date of this rule would be contrary to the public interest, because immediate action is necessary to protect the safety of the swimmers from the dangers associated with other vessels transiting this area while the race occurs.

The legal basis and authorities for this rule are found in 33 U.S.C. 1231, 46 U.S.C. Chapter 701, 3306, 3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Public Law 107-295, 116 Stat. 2064; and Department of Homeland Security Delegation No. 0170.1, which collectively authorize the Coast Guard to propose, establish, and define regulatory safety zones. Enviro-Sports Productions, Inc. is sponsoring the San Diego Sharkfest Swim, which will involve 400 swimmers. The safety zone will encompass the navigable waters from Seaport Village to the Coronado Ferry Landing. This temporary safety zone is necessary to provide for the safety of the swimmers, crew, spectators, sponsor vessels, other vessels, and users of the waterway.

The Coast Guard is establishing a safety zone that will be enforced from 9 a.m. to 10 a.m. on October 12, 2014. The limits of the safety zone will encompass the navigable waters from Seaport Village to the Coronado Ferry Landing within the following positions:

The safety zone is necessary to provide for the safety of the swimmers, crew, spectators, and other vessels and users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within this safety zone unless authorized by the Captain of the Port, or his designated representative. Before the effective period, the Coast Guard will publish a local notice to mariners (LNM).

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders. We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation is unnecessary. This determination is based on the size, location, and the limited duration of the safety zone.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit or anchor in the impacted portion of San Diego Bay from 9 a.m. to 10 a.m. on October 12, 2014.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons. The safety zone would only apply to a small area of San Diego Bay from Seaport Village to the Coronado Ferry Landing. Also traffic would be allowed to pass through the zone with the permission of the Captain of the Port, or his designated representative. Before the effective period, the Coast Guard will publish a Local Notice to Mariners.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT , above.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has 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. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA)(42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves establishment of a safety zone on the navigable waters of San Diego Bay. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES . We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

Background on the Proposed and Final Rulemaking

On June 9, 2014, NMFS published a proposed rule in the Federal Register (79 FR 32903) that would revise and add to regulations at 50 CFR part 300, subpart C. The purpose of the proposed rule was to implement whale shark conservation measures of the IATTC Resolution on Collection and Analysis of Data on Fish-Aggregating Devices (C-13-04). It was available for public comment through June 30, 2014. One comment was received in support of the proposed conservation and management measures. Additionally, in response to internal NOAA comments, the phrase “as may be further specified by NMFS” was added to the paragraph to clarify that the public may be directed to submit the report on a specific part of the form chosen to be used to fulfill the requirement (e.g. the South Pacific Regional Purse Seine Logsheet). The intent of this language is to allow flexibility for the whale shark interaction reporting obligation using one of multiple approved reporting forms, including the South Pacific Regional Purse Seine Logsheet for trips originating in the western and central Pacific Ocean, and the Seiner Fishing Record and Bridge Log for trips originating in the IATTC Convention Area.

This final rule is implemented under authority of the Tuna Conventions Act (16 U.S.C. 951-961), which authorizes the Secretary of Commerce, with approval by the Secretary of State, to promulgate such regulations as may be necessary to carry out the obligations of the United States as a member of the 1949 Convention for the Establishment of an Inter-American Tropical Tuna Commission (Convention), including the decisions of the IATTC. The authority to promulgate regulations has been delegated to NMFS.

The proposed rule included background information on the Convention and the IATTC, the international obligations of the United States under the Convention, and the basis for the proposed regulations. Therefore, this information is not repeated here.

This final rule implements the conservation measures for whale sharks contained in Resolution C-13-04. The regulations would apply to owners and operators of U.S. purse seine vessels while commercially fishing for tuna in the Convention Area. This final rule contains three specific provisions. The first prohibits the setting of any purse seine on a school of tuna associated with a live whale shark. In the event that a whale shark is encircled by a purse seine net, the second and third provisions require that purse seine vessel operators take all reasonable steps to ensure the safe release of the shark and report the incident to the relevant governmental authority, including the number of individual whale sharks, details of how and why the encirclement happened, where it occurred, steps taken to ensure safe release, and an assessment of the life status of the whale shark upon release (including whether the animal was released alive, but subsequently died).

The NMFS Assistant Administrator has determined that this final rule is consistent with the Tuna Conventions Act and other applicable laws.

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

Pursuant to the Regulatory Flexibility Act (RFA), 5 U.S.C. 605(b), the Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this action would not have a significant economic impact on a substantial number of small entities. The factual basis for the certification was published in the proposed rule and is not repeated here. No comments were received regarding this certification. As a result, a Final Regulatory Flexibility Analysis was not required and none was prepared.

This final rule contains a collection-of-information requirement subject to the Paperwork Reduction Act (PRA), which has been approved by the Office of Management and Budget (OMB) under control numbers 0648-0387 and 0648-0218. Public reporting burden for whale shark interaction reporting is estimated to average ten minutes per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate, or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS (see ADDRESSES ) and by email to OIRA_Submission@omb.eop.gov, or fax to (202) 395-7285.

Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB Control Number.

For the reasons set out in the preamble, 50 CFR part 300, subpart C is amended as follows: