[Federal Register Volume 80, Number 204 (Thursday, October 22, 2015)]
[Proposed Rules]
[Pages 63950-63956]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-26844]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 680

[Docket No. 150313268-5268-01]
RIN 0648-BE98


Fisheries of the Exclusive Economic Zone Off Alaska; Bering Sea 
and Aleutian Islands Crab Rationalization Program

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

ACTION: Proposed rule; request for comments.

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SUMMARY: NMFS issues a proposed rule to implement Amendment 44 to the 
Fishery Management Plan for Bering Sea/Aleutian Islands King and Tanner 
Crabs (FMP) and a regulatory amendment that would modify regulations 
governing the Crab Rationalization (CR) Program. The proposed rule 
would modify regulations to reflect that a Right of First Refusal 
(ROFR) may continue with the current ROFR holder or a new ROFR holder 
when processor quota share (PQS) is transferred and would require PQS 
holders to make specific certifications regarding ROFR contracts when 
annually applying for individual processor quota (IPQ) and when 
transferring PQS that are subject to a ROFR. In addition, this proposed 
rule would amend CR Program regulations to separate the annual 
individual fishing quota (IFQ)/IPQ application into two separate 
applications, and would require that crab harvesting cooperatives list 
the name of each member of the cooperative in its application for IFQ 
rather than provide NMFS with copies of each member's IFQ application. 
These actions are necessary to improve available information concerning 
transfer and use of PQS and IPQ subject to a ROFR, thereby enhancing 
the ability of eligible crab communities to retain their historical 
processing interests in the Bering Sea and Aleutian Islands (BSAI) crab 
fisheries, and to improve the administration of the CR Program. These 
actions are intended to promote the goals and objectives of the 
Magnuson-Stevens Fishery Conservation and Management Act, the FMP, and 
other applicable laws.

DATES: Submit comments on or before November 23, 2015.

ADDRESSES: You may submit comments, identified by NOAA-NMFS-2013-0057, 
by any one of the following methods.
     Electronic Submission: Submit all electronic public 
comments via the Federal e-Rulemaking Portal. Go to 
www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2013-0057, click the 
``Comment Now!'' icon, complete the required fields, and enter or 
attach your comments.
     Mail: Submit written comments to Glenn Merrill, Assistant 
Regional Administrator, Sustainable Fisheries Division, Alaska Region 
NMFS, Attn: Ellen Sebastian. Mail comments to P.O. Box 21668, Juneau, 
AK 99802-1668.
    Instructions: Comments sent by any other method, to any other 
address or individual, or received after the end of the comment period, 
may not be considered by NMFS. All comments received are a part of the 
public record and will generally be posted for public viewing on 
www.regulations.gov without change. All personal identifying 
information (e.g., name, address), confidential business information, 
or otherwise sensitive information submitted voluntarily by the sender 
will be publicly accessible. NMFS will accept anonymous comments (enter 
``N/A'' in the required fields if you wish to remain anonymous).
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in this 
rule may be submitted to NMFS at the above address; emailed to 
[email protected] or faxed to 202-395-7285.
    Electronic copies of Amendment 44 to the FMP, the Regulatory Impact 
Review (RIR), the Initial Regulatory Flexibility Analysis (IRFA), and 
the Categorical Exclusion prepared for this action may be obtained from 
http://www.regulations.gov or from the Alaska Region Web site at http://alaskafisheries.noaa.gov. The Environmental Impact Statement (EIS), 
RIR, and Social Impact Assessment prepared for the CR Program are 
available from the NMFS Alaska Region Web site at http://alaskafisheries.noaa.gov.

FOR FURTHER INFORMATION CONTACT: Rachel Baker, 907-586-7228.

SUPPLEMENTARY INFORMATION: NMFS manages the king and Tanner crab 
fisheries in the exclusive economic zone of the Bering Sea and Aleutian 
Islands (BSAI) under the FMP. The North Pacific Fishery Management 
Council (Council) prepared the FMP under the Magnuson-Stevens Fishery 
Conservation and Management Act (Magnuson-Stevens Act), 16 U.S. C. 1801 
et seq. Regulations governing U.S. fisheries and implementing the FMP 
appear at 50 CFR part 680.
    NMFS published the final rule to implement the Crab Rationalization 
(CR) Program on March 2, 2005 (70 FR 10174). Fishing under the CR 
Program started with the 2005/2006 crab fishing year.
    The Council submitted Amendment 44 for review by the Secretary of 
Commerce. A notice of availability of Amendment 44 was published in the 
Federal Register on October 9, 2015 (80 FR 61150), with comments 
invited through December 8, 2015. All relevant written comments 
received by that time, whether specifically directed to Amendment 44, 
or to the proposed rule, will be considered in the approval/disapproval 
decision on Amendment 44.
    The CR Program is a catch share program for nine BSAI crab 
fisheries that allocates those resources among harvesters, processors, 
and coastal communities. Under the CR Program, NMFS issued quota share 
(QS) to eligible harvesters based on their historical participation 
during a set of qualifying years in one or more of the nine CR Program 
fisheries. QS is an exclusive, revocable privilege allowing the holder 
to harvest a specific percentage of the annual total allowable catch 
(TAC) in a CR Program fishery.
    A QS holder's annual allocation, called individual fishing quota 
(IFQ), is expressed in pounds and is based on the amount of QS held in 
relation to the total QS pool for that fishery. NMFS issues IFQ in 
three classes: Class A IFQ, Class B IFQ, and Class C IFQ. Three percent 
of IFQ is issued as Class C IFQ for captains and crew. Of the remaining 
IFQ, 90 percent is issued as Class A IFQ and 10 percent is issued as 
Class B IFQ.
    NMFS issued processor quota share (PQS) to qualified individuals 
and entities based on processing activities in CR Program fisheries 
during a period of qualifying years. PQS is an exclusive, revocable 
privilege to receive deliveries of a fixed percentage of the annual TAC 
from a CR Program fishery. A PQS holder's annual allocation is known as 
individual processing quota (IPQ). NMFS issues IPQ at a one-to-one 
correlation with the amount of Class A

[[Page 63951]]

IFQ issued for each CR Program fishery. Class A IFQ must be delivered 
to a processor holding a matching amount of IPQ; Class C IFQ and Class 
B IFQ may be delivered to any registered crab receiver.

Right of First Refusal

    The CR Program includes several provisions intended to protect 
specific communities that had historically been active in the 
processing of king and Tanner crab from adverse impacts that could 
result from the CR Program. The CR Program established eligibility 
criteria and regulations at 50 CFR 680.2 identified the nine 
communities that satisfy the eligibility criteria: Adak, Akutan, Dutch 
Harbor, Kodiak, King Cove, False Pass, St. George, St. Paul, and Port 
Moller. These communities are referred to as ``eligible crab 
communities'' for purposes of the CR Program's community protection 
measures. Additional detail on the rationale and criteria used to 
establish the eligible crab communities can be found in the final rule 
implementing the CR Program (March 2, 2005, 70 FR 10174). Additional 
information on the eligible crab communities is provided in Section 
3.1.4 of the RIR/IRFA prepared for this action.
    With the exception of Adak, the CR Program provides eligible crab 
communities, or ECCs, with a right of first refusal (ROFR) on certain 
PQS and IPQ transfers. A ROFR provides an eligible crab community with 
the right to intervene in the sale (i.e., transfer) of PQS, IPQ, and 
``other goods'' (i.e., assets) associated with that community under 
specific conditions. The regulations at Sec.  680.41(l) require an 
eligible crab community to identify an entity to represent it for 
purposes of ROFR. The eight eligible crab communities that have a ROFR, 
and their representative entities are listed in Table 9 of the RIR/
IRFA. The eligible crab community of Adak is not provided a ROFR for 
PQS or IPQ associated with that community because the CR Program 
incorporates other provisions to protect Adak. These provisions are 
described in the final rule implementing the CR Program (March 2, 2005, 
70 FR 10174).
    Of the eight eligible crab communities, four are community 
development quota (CDQ) communities, and four are non-CDQ communities. 
In the case of eligible crab communities that are also CDQ communities, 
the local CDQ group is the entity that can exercise the ROFR on behalf 
of the community (see Sec.  680.41(l)(2)(i)). For the other four non-
CDQ eligible crab communities, regulations authorize the governing 
bodies of these eligible crab communities to identify the entity that 
can exercise the ROFR on behalf of the community (see Sec.  
680.41(l)(2)(ii)).
    PQS and IPQ from the Bristol Bay red king crab, Bering Sea snow 
crab, Eastern Aleutian Islands golden king crab, St. Matthew Island 
blue king crab, and Pribilof red and blue king crab fisheries are 
subject to a ROFR. Section 3.1.3 of the RIR/IRFA describes the specific 
amounts of PQS and IPQ that were, and are, subject to ROFR.
    Under the ROFR, an eligible crab community entity is provided an 
opportunity to meet the same terms and conditions being offered to a 
proposed buyer of a proposed sale of PQS or IPQ. If an eligible crab 
community entity can meet the terms and conditions of a proposed sale, 
then the eligible crab community entity receives by transfer the PQS, 
IPQ, and any other goods instead of the proposed buyer. For a more 
detailed summary of ROFR, see section 3.1.3 of the RIR/IRFA.
    The CR Program included a ROFR to provide eligible crab communities 
an opportunity to retain crab PQS, IPQ, and other goods before they are 
transferred to another buyer who could then choose to use that PQS, 
IPQ, and other goods outside of the community. Such a transfer could 
adversely affect the economic stability of the community. The ROFR is 
intended to strike a balance between the interest of communities 
historically reliant on crab processing to retain that processing 
capacity within their communities, and the interest of PQS or IPQ 
holders to be able to engage in open market transfers of PQS, IPQ, and 
other goods.

ROFR Contract Terms

    The ROFR is administered under the CR Program through contractual 
arrangements between eligible crab community entities and PQS/IPQ 
holders. Persons who hold PQS/IPQ that is subject to a ROFR must enter 
into a contract with the eligible crab community entity eligible to 
exercise a ROFR for those PQS/IPQ shares. The terms required in a ROFR 
contract between an eligible crab community entity and PQS/IPQ holder 
were established with implementation of the CR Program and are set 
forth in Chapter 11 of the FMP. ROFR applies to any proposed sale of 
PQS, and sales of IPQ, if more than 20 percent of the PQS holders' 
community based IPQ in the fishery were processed outside of the 
community by another company (intra-company transfers within a region 
are excluded) in three of the preceding five years. Intra-company 
transfers within a region and transfers of PQS for continued use in the 
community are exempt from (i.e., do not trigger) the ROFR. The ROFR 
contract terms require that in order to complete a transfer under a 
ROFR, an eligible crab community entity must meet ``the same terms and 
conditions of the underlying [proposed sale] agreement and will include 
all processing shares and other goods included in that agreement.''
    The ROFR contract terms also state that all terms of any ROFR and 
contract entered into related to ROFR will be enforced through civil 
law. Additional details on the rationale for the civil enforcement of 
the terms in a ROFR contract are provided in the EIS, RIR, and Social 
Impact Assessment prepared for the CR Program, and the final rule 
implementing the CR Program (March 2, 2005, 70 FR 10174).
    An eligible crab community entity must meet two important 
requirements to complete a ROFR and receive PQS, IPQ, or other goods 
associated with a proposed sale. The eligible crab community entity 
must: (1) Exercise its ROFR, that is, provide a clear commitment to 
complete a purchase agreement within a specific time frame; and (2) 
perform under the ROFR, that is, meet all of the terms and conditions 
of the underlying agreement for the proposed sale within a specific 
time frame.
    To exercise the ROFR, an eligible crab community entity must 
provide the seller of PQS or IPQ subject to a ROFR with notice of its 
intent to exercise the ROFR and earnest money in the amount of 10 
percent of the contract amount or $500,000, whichever is less, within 
60 days of notice of a sale and receipt of the contract defining the 
sale's terms. To perform the ROFR, the eligible crab community entity 
must meet the terms and conditions of the proposed sale (i.e., complete 
the sale) within 120 days, or within the time specified in the proposed 
sales contract, whichever is longer. If an eligible crab community 
entity does not exercise its ROFR, or it cannot perform under the ROFR 
contract, then the open market sale may proceed.

Revising ROFR Contract Terms

    The CR Program, including the ROFR contract terms, was implemented 
under authority provided at section 313(j)(1) of the Magnuson-Stevens 
Act. Section 313(j)(3) states that after initial implementation of the 
CR Program, the Council may submit and the Secretary may implement 
changes to conservation and management measures for crab fisheries of 
the Bering Sea and Aleutian Islands to achieve on a continuing basis 
the purposes identified by the Council. This provision allows the 
Council to

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recommend, and NMFS to adopt, revisions to the required terms of a ROFR 
contract. Proposed Amendment 44 to the FMP would modify several of the 
existing ROFR contract terms and add two additional contract terms. For 
reasons provided in the notice of availability for Amendment 44 (80 FR 
61150, October 9, 2015) and this proposed rule, the Council and NMFS 
have determined that the modifications to the ROFR contract terms and 
regulations governing ROFR that would be made by proposed Amendment 44 
and this proposed rule improve the achievement of the purposes of ROFR 
that were identified by the Council when it adopted the CR Program.
    As noted earlier, the terms in a ROFR contract are enforced through 
civil contract law rather than through regulations implemented by NMFS. 
Amendment 44 to the FMP and this proposed rule would not change the 
civil enforcement of the terms in a ROFR contract. The proposed rule 
would revise regulations to implement Amendment 44 and to amend the CR 
Program. Regulations implemented by NMFS are enforced by NMFS. 
Therefore, the regulatory changes in this proposed rule (i.e., measures 
that are more than solely amendments to the FMP modifying the terms in 
a ROFR contract) would be subject to enforcement by NMFS.

Need for Action

    In developing the CR Program, the Council and NMFS recognized the 
unique historical relationship between eligible crab communities and 
processors associated with those communities, and established ROFR 
provisions to provide opportunities for eligible crab communities to be 
notified and intervene in sales of crab processing assets important to 
those communities. However, with experience gained from implementation, 
the Council has determined that some of the ROFR contract terms and the 
lack of regulatory requirements to ensure adequate notification and 
tracking of PQS and IPQ transfers are limiting the effectiveness of the 
ROFR provisions.
    Stakeholders, including representatives from the eight eligible 
crab community entities that can exercise a ROFR, noted several 
concerns with ROFR contract terms that could hinder an eligible crab 
community entity from effectively exercising and performing under a 
ROFR. Eligible crab community entities also supported additional 
regulatory provisions to ensure proper notification of proposed sales. 
Holders of PQS/IPQ subject to a ROFR concurred that several changes to 
the ROFR contract terms and notification requirements could improve the 
ability of eligible crab community entities to exercise and perform 
under a ROFR without unduly limiting open market transfers of PQS, IPQ, 
and other goods. The Council reviewed and analyzed these concerns in a 
series of documents that have been consolidated under the RIR/IRFA 
prepared for Amendment 44 and this proposed rule (see ADDRESSES). The 
Council recommended the provisions comprising Amendment 44 and this 
proposed rule at its February 2013 and its October 2014 meetings.
    Proposed Amendment 44 and this proposed rule are intended to 
address four categories of concern that stakeholders have for the 
existing ROFR contract terms and regulations implementing ROFR. These 
are: (1) Inadequate time for an eligible crab community entity to 
exercise and perform under a ROFR; (2) ROFR contract terms that allow a 
ROFR to lapse; (3) ROFR contract terms that do not allow an eligible 
crab community entity and a PQS/IPQ holder to mutually agree to the 
specific assets subject to a ROFR and to exclude ``other goods'' if 
desired; and (4) the lack of verification that proper notification and 
reporting of proposed sales between PQS/IPQ holders and eligible crab 
community entities has occurred.

Summary of Proposed Amendment 44

    The specific provisions of proposed Amendment 44 are described in 
detail in the Notice of Availability published by NMFS on October 9, 
2015 (80 FR 61150). The following briefly summarizes the provisions of 
proposed Amendment 44.
    If approved by NMFS, Amendment 44 would modify the ROFR contract 
term specifying the amount of time to exercise and perform under a 
ROFR. Amendment 44 would increase the time allowed for an eligible crab 
community entity to exercise a ROFR from 60 days to 90 days from 
receipt of the sales contract. This modification would also increase 
the time allowed for an eligible crab community entity to perform under 
the ROFR from 120 days to 150 days. The time period to exercise and the 
time period to perform under a ROFR begin on the date of receipt of the 
sales contract by the eligible crab community entity and run 
concurrently. The extension of both time periods is intended to help 
accommodate eligible crab community entities when deciding whether to 
exercise their ROFR, but also continue to recognize that time may be of 
the essence for a PQS holder or buyer under a contract.
    Amendment 44 would remove the ROFR contract term that allows a ROFR 
to lapse if the IPQ derived from the PQS subject to ROFR was processed 
outside the community of origin for a period of three consecutive 
years. This amendment would allow a ROFR to remain in effect for PQS 
subject to a ROFR regardless of the location in which the IPQ 
associated with that PQS was processed. However, if approved, Amendment 
44 would not reinstate a ROFR that lapsed prior to implementation of 
Amendment 44. The Council determined, and NMFS agrees, that this 
amendment would strengthen the connection between PQS and the community 
from which it originated, by maintaining the right regardless of 
whether the yielded IPQ is used outside the community for extended 
periods. By maintaining the right despite use of IPQ outside of the 
community, the eligible crab community entity and the community of 
origin that it represents would maintain an interest in the PQS into 
the future.
    Amendment 44 also would remove the ROFR contract term stating that 
a ROFR will lapse if an eligible crab community entity fails to 
exercise its ROFR after it is triggered by a transfer of PQS and 
replace it with a ROFR contract term that would require the recipient 
of a PQS transfer to enter into a new ROFR contract with an eligible 
crab community entity of its choosing in the designated region of the 
PQS. This amendment would ensure that eligible crab community entities 
within the designated region of the PQS retain a ROFR on that PQS even 
if the original eligible crab community entity chooses not to exercise 
a ROFR.
    ROFR contract terms currently require that the ROFR apply to all 
terms and conditions of the underlying sale agreement, including all 
processing shares and other goods included in the agreement. Amendment 
44 would revise this ROFR contract term to specify that, ``Any right of 
first refusal must be on the same terms and conditions of the 
underlying agreement and will include all processing shares and other 
goods included in this agreement, or to any subset of those assets, as 
otherwise agreed to by the PQS holder and the community entity.'' The 
proposed addition of the last clause in this ROFR contract term would 
allow a PQS holder and an eligible crab community entity to negotiate 
what assets may be subject to a ROFR. This would provide PQS holders 
and eligible crab community entities with more flexibility compared to 
the status quo. For example, it would allow an eligible crab community 
entity to reach an agreement with the PQS

[[Page 63953]]

holder that the ROFR would only apply to the PQS, and not to any other 
goods associated with a proposed sale.
    Amendment 44 also would establish two new ROFR contract terms. 
First, Amendment 44 would add a ROFR contract term that requires a PQS 
holder to notify the eligible crab community entity of any proposed 
transfer of IPQ or PQS subject to ROFR, regardless of whether the PQS 
holder believes the proposed transfer triggers the right. Second, 
Amendment 44 would add a ROFR contract term that requires a PQS holder 
to annually notify the eligible crab community entity of the location 
at which IPQ derived from PQS subject to a ROFR was processed and 
whether that IPQ was processed by the PQS holder. Both of these 
proposed notifications would provide the eligible crab community 
entities with more information on what is occurring with the PQS for 
which they hold a ROFR.
    If Amendment 44 is approved, all ROFR contracts would be required 
to contain the newly revised ROFR contract terms. Because Amendment 44 
would modify the terms required to be included in a ROFR contract, a 
PQS/IPQ holder and an eligible crab community entity would need to 
establish a new or revised ROFR contract to contain all of these terms.

The Proposed Rule

    This proposed rule contains three actions. The first action would 
implement those aspects of Amendment 44 that require implementing 
regulations. The second action would implement the regulatory amendment 
adopted by the Council. The third action would implement minor 
administrative changes to the CR Program regulations to improve the 
application and reporting practices for participants in the CR Program. 
The following paragraphs provide additional detail on these proposed 
actions.

Action 1: Regulatory Revisions Needed To Implement Amendment 44

    Most of the provisions of Amendment 44 only modify the ROFR 
contract terms contained in the FMP and do not require adjustments or 
additions to regulations implementing ROFR at 50 CFR part 680. However, 
one provision of proposed Amendment 44 requires modification to 
regulations at Sec.  680.41(i)(8) governing transfers of PQS subject to 
ROFR.
    As explained above, a ROFR would no longer lapse if an eligible 
crab community entity fails to exercise its ROFR after the ROFR is 
triggered by a transfer of PQS under proposed Amendment 44. Instead, 
proposed Amendment 44 would require the recipient of a PQS transfer, or 
buyer, to enter into a new ROFR contract with an eligible crab 
community entity of its choosing in the designated region of the PQS. 
The buyer could enter into a new ROFR contract with the eligible crab 
community entity that held the ROFR with the seller, or the buyer could 
enter into a new ROFR contract with an eligible crab community entity 
that represents an eligible crab community within the region for which 
the PQS is designated. This provision of Amendment 44 would ensure that 
one eligible crab community entity within the designated region of the 
PQS retains a ROFR on that PQS even if the original eligible crab 
community entity does not exercise its ROFR. This provision is intended 
to strengthen the ROFR program by maintaining a link between PQS and 
eligible crab communities in perpetuity. In addition, the proposed 
provision may provide the original eligible crab community entity that 
is not able to exercise a ROFR with another opportunity to use ROFR at 
some point in the future, should it be triggered again through a 
proposed sale of the PQS.
    Because the buyer's choice of an eligible crab community entity 
would occur at the time of transfer of the PQS, regulations at Sec.  
680.41(i)(8) governing transfer of PQS would need to be modified to 
require the seller to certify that the eligible crab community entity 
did not exercise its ROFR within the time provided and to require the 
buyer to certify that the buyer has entered into a ROFR contract with 
an eligible crab community entity in the designated region of the PQS. 
These proposed changes to Sec.  680.41(i)(8) would not alter the 
current requirement that NMFS wait 10 days before approving a transfer 
of PQS subject to ROFR when such transfer triggers the ROFR.

Action 2: Regulatory Revisions Needed To Implement the Regulatory 
Amendment

    At the time it took action on Amendment 44, the Council also 
recommended that holders of PQS/IPQ subject to ROFR provide NMFS with 
specific certifications regarding notice to ROFR holders and the 
existence of ROFR contracts when submitting an application to transfer 
PQS or when annually applying for IPQ. The Council's recommendations 
for certifications to NMFS do not require modifications to the FMP but 
require modifications to the regulations implementing ROFR in 50 CFR 
part 680.
    First, this proposed rule would modify regulations at Sec.  
680.4(f)(2) to require an applicant, as part of the Application for 
Annual Crab IPQ Permit, to certify to NMFS that a ROFR contract that 
includes the required ROFR contract terms specified in Chapter 11 of 
the FMP exists between the applicant and the eligible crab community 
entity that holds the ROFR for that PQS/IPQ. If Amendment 44 is 
approved, all ROFR contracts would be required to contain the newly 
revised ROFR contract terms. Because Amendment 44 would modify the 
terms required to be included in a ROFR contract, a PQS/IPQ holder and 
an eligible crab community entity would need to establish a new or 
revised ROFR contract to contain all of these terms and the PQS/IPQ 
holder would need to certify annually that a ROFR contract was in 
place. By including this certification as part of the annual 
application for IPQ, NMFS realizes that if an applicant for IPQ is 
unable to establish a revised ROFR contract with an eligible crab 
community entity and provide that confirmation to NMFS in the annual 
application for crab IPQ permit prior to the date that application is 
due, then NMFS would consider the application to be incomplete. In that 
case, NMFS would withhold issuance of IPQ until this requirement is 
met.
    Second, this proposed rule would modify regulations at Sec.  
680.41(i)(8) and (9) to require specific certifications by the seller 
or the buyer when transferring PQS subject to ROFR. If a transfer of 
PQS triggers a ROFR, regulations at Sec.  680.41(i)(8) would require 
the seller to certify, as part of the application to transfer PQS, that 
the PQS holder notified the eligible crab community entity holding the 
ROFR for that PQS of the proposed transfer at least 90 days prior to 
the date of the transfer application, and that the eligible crab 
community entity did not exercise its ROFR during that period. If a 
transfer of PQS does not trigger a ROFR, regulations at Sec.  
680.41(i)(9) would be modified to require the buyer and the eligible 
crab community entity to certify, as part of the application to 
transfer PQS, either that the eligible crab community entity wishes to 
permanently waive ROFR for the PQS or that the buyer and the eligible 
crab community entity completed a ROFR contract that includes the ROFR 
contract terms specified in Chapter 11 of the FMP. NMFS would not 
complete a transfer of PQS until these requirements are met.
    The Council determined and NMFS agrees that these additional notice 
requirements would directly address the concerns of eligible crab 
community entities and PQS/IPQ holders that there

[[Page 63954]]

may not be adequate information sharing between the parties subject to 
a ROFR contract. These notices would ensure that all parties have 
accurate and up-to-date information concerning the use of PQS and IPQ, 
as well as any sales of PQS. For additional detail on these proposed 
notice requirements, see section 3.2.5 of the RIR/IRFA.

Action 3: Administrative Changes

    NMFS proposes two minor administrative changes to CR Program 
regulations. First, NMFS proposes revising regulations at Sec.  
680.4(d) to separate the current combined application for IFQ/IPQ into 
two separate applications, an application for IFQ and an application 
for IPQ. This proposed revision is intended to reduce confusion among 
applicants who sometimes misunderstand the requirements for the 
combined IFQ/IPQ application and would improve the ability of 
applicants to correctly provide the necessary information. This 
revision would allow applicants for IFQ to use an application form 
specific to IFQ, and applicants for IPQ to use an application form 
specific to IPQ. Except for the proposed modification to the annual IPQ 
application described above in the ``Action 2: Regulatory Revisions 
Needed To Implement the Regulatory Amendment'' section, the proposed 
changes would not modify the specific information currently required of 
IFQ or IPQ applicants, but would change the application form required 
to be submitted and the format of the application form.
    Second, NMFS proposes revisions to reporting requirements for crab 
harvesting cooperatives at Sec.  680.21(b)(1). Currently, regulations 
at Sec.  680.4(f) require each member of a crab harvesting cooperative 
to submit to NMFS an Application for Annual Crab IFQ Permit, and 
regulations at Sec.  680.21(b) require a crab harvesting cooperative to 
submit to NMFS a copy of each member's Application for Annual Crab IFQ 
Permit along with the cooperative's Application for Annual Crab 
Harvesting Cooperative IFQ Permit. NMFS has determined that while the 
identification of cooperative members is critical to the cooperative 
application process, NMFS can obtain this information through less 
burdensome means. Therefore, NMFS proposes revising the regulations at 
Sec.  680.21(b)(1) so that a crab harvesting cooperative would be 
responsible only for submitting a list of the names of each cooperative 
member with the cooperative's annual IFQ application. Under the 
proposed rule, crab harvesting cooperatives would no longer be required 
to submit copies of each member's annual IFQ application. NMFS notes 
that the proposed rule does not modify the requirements at Sec.  
680.4(f) and each cooperative member would continue to be responsible 
for submitting to NMFS a complete annual IFQ permit application by the 
deadline of June 15. This proposed change would provide NMFS with 
necessary information while reducing duplicative reporting requirements 
for crab harvesting cooperatives.

Classification

    Pursuant to section 304(b)(1)(A) and 305(d) of the Magnuson-Stevens 
Act, the NMFS Assistant Administrator has determined that this proposed 
rule is consistent with the FMP, other provisions of the Magnuson-
Stevens Act, and other applicable law, subject to further consideration 
of comments received during the public comment period.
    This proposed rule has been determined to be not significant for 
the purposes of Executive Order 12866.

Initial Regulatory Flexibility Analysis (IRFA)

    An IRFA was prepared, as required by section 603 of the Regulatory 
Flexibility Act. The IRFA describes the economic impact this proposed 
rule, if adopted, would have on small entities. Copies of the RIR/IRFA 
prepared for this proposed rule are available from NMFS (see 
ADDRESSES).
    The IRFA for this proposed action describes the action, why this 
action is being proposed, the objectives and legal basis for the 
proposed rule, the type and number of small entities to which the 
proposed rule would apply, and the projected reporting, recordkeeping, 
and other compliance requirements of the proposed rule. It also 
identifies any overlapping, duplicative, or conflicting Federal rules 
and describes any significant alternatives to the proposed rule that 
would accomplish the stated objectives of the Magnuson-Stevens Act and 
other applicable statues and that would minimize any significant 
adverse economic impact of the proposed rule on small entities. The 
description of the proposed action, its purpose, and its legal basis 
are described in the preamble and are not repeated here. The IRFA 
prepared for this proposed rule incorporates by reference an extensive 
RIR/FRFA prepared for Amendments 18 and 19 to the FMP that detail the 
impacts of the CR Program on small entities.
    The proposed rule includes three separate actions. Action 1 
includes regulatory revisions to implement Amendment 44. The proposed 
revisions would require the buyer of PQS to certify to NMFS that the 
buyer has entered into a ROFR contract with an eligible crab community 
entity in the designated region of the PQS.
    Action 2 would require PQS holders to provide two notifications to 
NMFS regarding the status of their ROFR. The first certification would 
require PQS holders applying to receive IPQ to attest that a ROFR 
contract that includes the required ROFR contract terms exists between 
the applicant and the eligible crab community entity that holds the 
ROFR for that PQS/IPQ. The second certification would require the 
seller of PQS to certify to NMFS that the seller provided the eligible 
crab community entity with notice of the proposed sale at least 90 days 
prior to the date of the transfer application and that the entity did 
not exercise ROFR during that time period. These notifications would be 
incorporated into the Application for Annual Crab IPQ and the 
Application for Transfer of Crab QS or PQS, respectively.
    The small entities that would be directly regulated by Action 1 and 
Action 2 are persons that hold PQS or IPQ under the CR Program. 
Currently, 21 entities hold PQS or IPQ subject (now or previously) to 
ROFR. Estimates of the number of large entities were made, based on 
available records of revenue, employment information, and known 
affiliations among these entities. Of these 21 entities, 10 are 
estimated to be large entities and 11 are deemed to be small entities. 
It is possible that additional entities could be directly regulated 
under the proposed rule if an entity that does not already hold PQS 
receives PQS by transfer. The new PQS holder would be directly 
regulated because the entity would be required to certify to NMFS that 
they have entered into a ROFR contract. It is not possible to estimate 
whether these new PQS holders would be small entities for purposes of 
this proposed rule.
    Action 3 would make minor administrative changes to clarify permit 
application procedures for IFQ holders and IPQ holders, and reduce 
reporting requirements for crab cooperatives that are directly 
regulated under the CR Program. Currently, there are 10 crab harvesting 
cooperative entities. Based on available records of revenue, and known 
affiliations among these entities, 4 of the entities are estimated to 
be large entities and 6 are deemed to be small entities. Because these 
changes would reduce the reporting burden for all crab harvesting 
cooperatives, Action 3 would not have an adverse impact on directly 
regulated small entities.

[[Page 63955]]

    The certifications in the proposed rule are straightforward, simple 
and are provided annually or at the time of a transfer of shares as 
part of applications. While the new notification requirements would add 
administrative reporting requirements for 11 PQS/IPQ holders that are 
small entities, the Council determined that the administrative burden 
associated with the notification requirements would be minimal and 
would not negatively impact these entities.

Duplicate, Overlapping, or Conflicting Federal Rules

    NMFS has not identified any duplication, overlap, or conflict 
between this proposed action and existing Federal rules.

Recordkeeping and Reporting Requirements

    The recordkeeping and reporting requirements would be increased 
slightly under this proposed rule. This proposed rule would include new 
reporting requirements for PQS/IPQ holders. The PQS/IPQ holders would 
be required to certify to NMFS that a current ROFR contract is in place 
when applying for IPQ and notify NMFS of the status of the ROFR when 
transferring PQS or IPQ. These additional reporting requirements would 
be relatively straightforward and simple, and NMFS proposes including 
these certifications requirements into the Application for Annual Crab 
IPQ and the Application for Transfer of Crab PQS that are already 
required for directly regulated entities to receive IPQ or to transfer 
PQS or IPQ. Therefore, the additional recordkeeping and reporting 
requirements associated with the proposed rule would be minimal.

Collection-of-Information Requirements

    This proposed rule contains collection-of-information requirements 
subject to review and approval by the Office of Management and Budget 
(OMB) under the Paperwork Reduction Act (PRA). These requirements have 
been submitted to OMB for approval under OMB Control Number 0648-0514. 
Public reporting burden is estimated to average per response: 1.5 hours 
for the Annual Application for Crab IFQ Permit; 1.5 hours for the 
Annual Application for Crab IPQ Permit; 1 hour for the Application for 
an Annual Crab Harvesting Cooperative IFQ permit; and 2 hours for 
Application to Transfer Crab QS or PQS. These estimates include the 
time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
the collection of information.
    Public comment is sought regarding whether this proposed collection 
of information is necessary for the proper performance of the functions 
of the agency, including whether the information shall have practical 
utility; the accuracy of the burden statement; ways to enhance quality, 
utility, and clarity of the information to be collected; and ways to 
minimize the burden of the collection of information, including through 
the use of automated collection techniques or other forms of 
information technology. Send comments on these or any other aspects of 
the collection of information, to NMFS (see ADDRESSES), and by email to 
[email protected] 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 penalty for 
failure to comply with, a collection of information subject to the 
requirement of the PRA, unless that collection of information displays 
a currently valid OMB control number.

List of Subjects in 50 CFR Part 680

    Alaska, Fisheries, Reporting and recordkeeping requirements.

    Dated: October 15, 2015.
Samuel D. Rauch III,
Deputy Assistant Administrator for Regulatory Programs, National Marine 
Fisheries Service.

    For the reasons set out in the preamble, 50 CFR part 680 is 
proposed to be amended as follows:

PART 680--SHELLFISH FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF 
ALASKA

0
1. The authority citation for 50 CFR part 680 continues to read as 
follows:

    Authority:  16 U.S.C. 1862; Pub. L. 109-241; Pub. L. 109-479.

0
2. In Sec.  680.4,
0
a. Revise paragraphs (d)(3), (e)(1), (e)(3), (f) heading, and 
(f)(2)(ii);
0
b. Redesignate paragraphs (f)(2)(iv) and (f)(2)(v) as (f)(2)(v) and 
(f)(2)(vi), respectively;
0
c. Add paragraph (f)(2)(iv);
    The revisions and additions to read as follows:


Sec.  680.4  Permits.

* * * * *
    (d) * * *
    (3) On an annual basis, the Regional Administrator will issue a 
crab IFQ permit to a person who submits a complete Application for 
Annual Crab Individual Fishing Quota (IFQ) Permit, described at 
paragraph (f) of this section, that is subsequently approved by the 
Regional Administrator.
* * * * *
    (e) * * *
    (1) A crab IPQ permit authorizes the person identified on the 
permit to receive/process the IPQ crab identified on the permit during 
the crab fishing year for which the permit is issued, subject to 
conditions of the permit. A crab IPQ permit is valid under the 
following circumstances:
* * * * *
    (3) On an annual basis, the Regional Administrator will issue a 
crab IPQ permit to a person who submits a complete Application for 
Annual Crab Individual Processing Quota (IPQ) Permit, described at 
paragraph (f) of this section, that is subsequently approved by the 
Regional Administrator.
* * * * *
    (f) Contents of annual applications for crab IFQ and IPQ permits.
* * * * *
    (2) * * *
    (ii) Crab IFQ or IPQ permit identification. Indicate the type of 
crab IFQ or IPQ permit for which applicant is applying by QS 
fishery(ies) and indicate (YES or NO) whether applicant has joined a 
crab harvesting cooperative. If YES, enter the name of the crab 
harvesting cooperative(s) the applicant has joined for each crab 
fishery.
* * * * *
    (iv) Certification of ROFR contract for crab IPQ permit. Indicate 
(YES or NO) whether any of the IPQ for which the applicant is applying 
to receive is subject to right of first refusal (ROFR). If YES certify 
(YES or NO) whether there is a ROFR contract currently in place between 
the applicant and the ECC entity holding the ROFR for the IPQ that 
includes the required ROFR contract terms specified in Chapter 11 
section 3.4.4.1.2 of the Fishery Management Plan for Bering Sea/
Aleutian Islands King and Tanner Crabs.
* * * * *
0
3. In Sec.  680.21, revise paragraph (b)(1) to read as follows:


Sec.  680.21  Crab harvesting cooperatives.

* * * * *
    (b) * * *
    (1) June 15 application deadline. A completed Application for 
Annual Crab Harvesting Cooperative Individual Fishing Quota (IFQ) 
Permit listing the name of each member of the crab harvesting 
cooperative must be submitted annually by each crab harvesting 
cooperative and received by NMFS no later than June 15 (or postmarked 
by this date, if sent via U.S.

[[Page 63956]]

mail or a commercial carrier) for the upcoming crab fishing year for 
which the crab harvesting cooperative is applying to receive IFQ. If a 
complete application is not received by NMFS by this date, or 
postmarked by this date, the crab harvesting cooperative will not 
receive IFQ for the upcoming crab fishing year. In the event that NMFS 
has not received a complete and timely application by June 15, NMFS 
will presume that the application was timely filed if the applicant can 
provide NMFS with proof of timely filing. Each crab harvesting 
cooperative member is responsible for submitting a completed 
Application for Annual Crab Individual Fishing Quota Permit to NMFS by 
June 15 pursuant to Sec.  680.4.
* * * * *
0
4. In Sec.  680.41, revise paragraphs (i)(8) and (9) to read as 
follows:


Sec.  680.41  Transfers of QS, PQS, IFQ or IPQ.

* * * * *
    (i) * * *
    (8) In the case of an application for transfer of PQS or IPQ for 
use outside an ECC that has designated an entity to represent it in 
exercise of ROFR under paragraph (l) of this section:
    (i) The Regional Administrator will not act upon the application 
for a period of 10 days. At the end of that time period, the 
application will be approved pending meeting the criteria set forth in 
paragraph (i) of this section.
    (ii) The person applying to transfer PQS subject to ROFR must 
include an affidavit certifying that the ECC entity was provided with 
notice of the proposed transfer at least 90 days prior to the date of 
the transfer application and that the ECC entity did not exercise its 
ROFR during that period.
    (iii) The person applying to receive the PQS must include an 
affidavit certifying that a ROFR contract that includes the ROFR 
contract terms specified in Chapter 11 section 3.4.4.1.2 of the Fishery 
Management Plan for Bering Sea/Aleutian Islands King and Tanner Crabs 
has been completed with an ECC entity eligible to hold a ROFR under 
paragraph (l) of this section and that represents an EEC within the 
region for which the PQS is designated.
    (9) In the case of an application for transfer of PQS for use 
within an ECC that has designated an entity to represent it in exercise 
of ROFR under paragraph (l) of this section, the Regional Administrator 
will not approve the application unless the proposed recipient of the 
PQS and the ECC entity provide an affidavit to the Regional 
Administrator certifying that either the ECC wishes to permanently 
waive ROFR for the PQS or that a ROFR contract that includes the ROFR 
contract terms specified in Chapter 11 section 3.4.4.1.2 of the Fishery 
Management Plan for Bering Sea/Aleutian Islands King and Tanner Crabs 
has been completed by the proposed recipient of the PQS and the ECC 
entity.
* * * * *
[FR Doc. 2015-26844 Filed 10-21-15; 8:45 am]
 BILLING CODE 3510-22-P