[Federal Register Volume 81, Number 150 (Thursday, August 4, 2016)]
[Proposed Rules]
[Pages 51386-51394]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18452]


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DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

9 CFR Parts 1, 2, and 3

[Docket No. APHIS-2014-0059]
RIN 0579-AD99


Thresholds for De Minimis Activity and Exemptions From Licensing 
Under the Animal Welfare Act

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: We are proposing to amend the Animal Welfare Act (AWA) 
regulations in response to a 2014 Farm Bill amendment to the Act that 
provides the Secretary of Agriculture with the authority to determine 
that animal dealers and exhibitors are not required to obtain a license 
under the Act and regulations if the size of the business conducting 
AWA-related activities is determined to be de minimis by the Secretary. 
The Animal and Plant Health Inspection Service has reviewed past 
compliance with the Animal Welfare Act of currently-regulated 
facilities and has determined that de minimis businesses, as defined in 
the rule are capable of providing adequate care and treatment of the 
animals involved in regulated business activities. We also propose 
amending the regulations in response to a 2013 amendment to the Act 
that excludes from the definition of ``exhibitor'' some owners of 
household pets that are exhibited occasionally, generate less than a 
substantial portion of income, and reside exclusively with the owner. 
Dealers and exhibitors operating at or below the thresholds determined 
for their particular AWA-related business activity would be exempted 
from Federal licensing requirements established under the Act and 
regulations. Our proposed actions would amend the regulations to be 
consistent with the Act while continuing to ensure the humane care and 
treatment of animals covered under the AWA.

DATES: We will consider all comments that we receive on or before 
November 2, 2016.

ADDRESSES: You may submit comments by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov/#!docketDetail;D=APHIS-2014-0059.
     Postal Mail/Commercial Delivery: Send your comment to 
Docket No. APHIS-2014-0059, Regulatory Analysis and Development, PPD, 
APHIS, Station 3A-03.8, 4700 River Road, Unit 118, Riverdale, MD 20737-
1238.
    Supporting documents and any comments we receive on this docket may 
be viewed at http://www.regulations.gov/#!docketDetail;D=APHIS-2014-
0059 or in our reading room, which is located in room 1141 of the USDA 
South Building, 14th Street and Independence Avenue SW., Washington, 
DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through 
Friday, except holidays. To be sure someone is there to help you, 
please call (202) 799-7039 before coming.

FOR FURTHER INFORMATION CONTACT: Dr. Kay Carter-Corker, DVM, Director, 
National Policy Staff, USDA-APHIS-Animal Care, 4700 River Road, Unit 
84, Riverdale, MD 20737; (301) 851-3748.

SUPPLEMENTARY INFORMATION: 

Background

    Under the Animal Welfare Act (AWA or the Act, 7 U.S.C. 2131 et 
seq.), the Secretary of Agriculture is authorized to promulgate 
standards and other requirements governing the humane handling, care, 
treatment, and transportation of certain animals by dealers, research 
facilities, exhibitors, operators of auction sales, and carriers and 
intermediate handlers. The Secretary has delegated responsibility for 
administering the AWA to the Administrator of U.S. Department of 
Agriculture's Animal and Plant Health Inspection Service (APHIS). 
Within APHIS, the responsibility for administering the AWA has been 
delegated to the Deputy Administrator for Animal Care. Regulations and 
standards established under the AWA are contained in the Code of 
Federal Regulations (CFR) in 9 CFR parts 1, 2, and 3 (referred to below 
as the regulations). Part 1 contains definitions for terms used in 
parts 2 and 3; part 2 provides administrative requirements and sets 
forth institutional responsibilities for regulated parties; and part 3 
contains specifications for the humane handling, care, treatment, and 
transportation of animals covered by the AWA.
    The AWA seeks to ensure the humane handling, care, treatment, and 
transportation of animals intended for use by dealers, research 
facilities, and exhibitors, operators of auction sales, and carriers 
and intermediate handlers. Dealers (including breeders meeting the 
definition of ``dealer'') and exhibitors of such animals must obtain 
licenses and comply with AWA regulations and standards, and their 
facilities are inspected by APHIS for compliance.

[[Page 51387]]

Exclusions and Exemptions in the Act

    The Act defines ``animal'' in Sec.  2132(g) specifically as any 
live or dead dog, cat, monkey (nonhuman primate mammal), guinea pig, 
hamster, rabbit, or such other warm-blooded animal, as the Secretary 
may determine is being used, or is intended for use, for research, 
testing, experimentation, or exhibition purposes, or as pets; but such 
term excludes birds, rats of the genus Rattus, and mice of the genus 
Mus, bred for use in research; horses not used for research purposes; 
and other farm animals, such as, but not limited to livestock or 
poultry, used or intended for use as food or fiber; for improving 
animal nutrition, breeding, management, or production efficiency; or 
for improving the quality of food or fiber. With respect to a dog, the 
term means all dogs including those used for hunting, security, or 
breeding purposes. Animals that do not fall under the definition of 
``animal'' in the Act are excluded from regulation and licensing.
    In addition to the exclusions provided to persons under the 
definition of ``animal,'' the Act contains exclusions for certain 
persons who buy, sell, transport, or exhibit animals that are covered 
under the Act. Under the definition of ``dealer'' in Sec.  2132, the 
Act excludes retail pet stores that do not sell any animals to a 
research facility, an exhibitor, or a dealer. Prior to its amendment by 
the 2014 Farm Bill,\1\ the Act also excluded from the definition of 
``dealer'' any person who does not sell or negotiate the purchase of 
any wild animal, dog, or cat and who derives no more than $500 gross 
income from the sale of other animals during any calendar year.
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    \1\ The Agricultural Act of 2014: http://www.gpo.gov/fdsys/pkg/BILLS-113hr2642enr/pdf/BILLS-113hr2642enr.pdf.
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    The definition of ``exhibitor'' under Sec.  2132(h) of the Act 
excludes retail pet stores, an owner of a common, domesticated 
household pet who derives less than a substantial portion of income 
from a nonprimary source (as determined by the Secretary) for 
exhibiting an animal that exclusively resides at the residence of the 
pet owner, organizations sponsoring and all persons participating in 
State and county fairs, livestock shows, rodeos, purebred dog and cat 
shows, and any other fairs or exhibitions intended to advance 
agricultural arts and sciences, as may be determined by the Secretary.
    Section 2133 of the Act establishes a requirement for licensing of 
dealers and exhibitors but excludes retail pet stores from the 
licensing requirement. Prior to its amendment by the 2014 Farm Bill, 
the Act also specifically excluded from licensing any person ``who 
derives less than a substantial portion of income (as determined by the 
Secretary) from the breeding and raising of dogs or cats on his own 
premises and sells any such dog or cat to a dealer or research 
facility.''

Business Size-Based Exemptions in the AWA Regulations

    The current regulations include, among others, licensing exemptions 
based on the size of the business with respect to the number of 
breeding female animals maintained or gross income from the sale of 
animals. These exemptions are explained below.

Retail Exemptions

    Reflecting what is stated in Sec.  2132 of the Act, Sec.  
2.1(a)(3)(i) of the AWA regulations affirms that retail pet stores are 
exempt from the licensing requirements. However, the Act itself 
provides no specific definition for the term ``retail pet store.'' In a 
2013 final rule,\2\ we defined a retail pet store to mean ``a place of 
business or residence at which the seller, buyer, and the animal 
available for sale are physically present so that every buyer may 
personally observe the animal prior to purchasing and/or taking custody 
of that animal after purchase, and where only the following animals are 
sold or offered for sale, at retail, for use as pets: Dogs, cats, 
rabbits, guinea pigs, hamsters, gerbils, rats, mice, gophers, 
chinchillas, domestic ferrets, domestic farm animals, birds, and 
coldblooded species.'' Prior to this change, the regulations referred 
to ``retail pet store'' as simply an ``outlet'' where the animals 
listed above were sold at retail, with no specific requirement that 
customers personally observe the animal prior to purchasing or taking 
custody of it. As a consequence, many large Internet-based retailers 
claiming the exemption were able to sell and ship pets to buyers sight 
unseen without the benefit of public or APHIS oversight to ensure 
humane treatment of their animals. The business model practiced by such 
Internet-based retailers selling pets bore no resemblance to a retail 
pet store in existence at the time the provision was originally 
promulgated in the Act.
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    \2\ September 18, 2013; 78 FR 57227-57250 (Docket No. APHIS-
2011-0003).
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    Our intent in amending the definition of ``retail pet store'' was 
to narrow the scope of the exemption to apply only to retailers who 
sell exclusively in face-to-face transactions so that pets sold by 
exempted retailers continue to be monitored for their humane care and 
treatment by the buying public. We made these changes to ensure that 
the definition of ``retail pet store'' was consistent with the original 
intent of the Act and to bring more pet animals sold at retail under 
its protection.
    In the rulemaking to define ``retail pet store,'' we also preserved 
an exemption in Sec.  2.1(a)(3)(vii) for purebred dog and cat fanciers 
with four or fewer breeding female dogs, cats, and/or small exotic or 
wild mammals who sell only the offspring of these animals and who, 
because of the size of their businesses, are capable of providing 
adequate care and treatment for the animals involved in regulated 
business activities without Federal licensing and inspection 
requirements to ensure animal welfare.
Wholesale Exemption
    Section 2.1(a)(3)(iii) exempts from licensing any person 
maintaining four or fewer breeding female dogs, cats, and/or small 
exotic or wild mammals, and who sells, at wholesale,\3\ only the 
offspring of those animals born and raised on his or her premises, for 
use as pets or exhibition. As was the case with retailers, we 
determined that wholesalers with four or fewer breeding females who 
sell only the offspring are capable of providing adequate care and 
treatment for the animals involved in regulated business activities 
without Federal licensing and inspection requirements to ensure animal 
welfare.
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    \3\ ``Wholesale'' means the sale of animals to other persons for 
resale.
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Income-Based Exemption
    The current AWA regulations also include the income-based exemption 
from licensing that was in Sec.  2132(f)(ii) of the Act prior to its 
amendment by Congress in the 2014 Farm Bill. The $500 gross income 
limit for persons who sell animals other than wild or exotic animals, 
dogs, or cats excludes such persons from the definition of ``dealer'' 
in Sec.  1.1 of the regulations and therefore exempts them from the 
licensing requirement in Sec.  2.1(a)(3)(ii). The rationale for 
establishing this exemption was to conform the regulations to the 1970 
statutory amendment to the Act.

2014 Farm Bill Amendments to the Act

    In the 2014 Farm Bill, Congress amended Sec.  2133 of the Act by 
giving the Secretary the authority to set thresholds for regulated 
activities involving animals under which businesses could be exempted 
from licensure as a dealer or exhibitor ``if the size of business is 
determined by the Secretary to be de minimis.'' The amendment provides 
APHIS with greater authority to exempt small businesses conducting AWA-

[[Page 51388]]

related activities from licensing and inspection, allowing us to direct 
our oversight and enforcement efforts on larger businesses conducting 
regulated activities.
    Congress noted in its Conference Report \4\ that this legislation 
codifies the exemption we made to the regulations \5\ in Sec.  
2.1(a)(3)(vii) for purebred dog and cat fanciers, and/or breeders of 
small exotic or wild mammals, who maintain four or fewer breeding 
females and sell the offspring at retail for pets or exhibition. 
Dealers qualifying for this licensing exemption are capable of 
providing adequate care and treatment for the animals involved in 
regulated business activities without Federal licensing and inspection 
requirements to ensure animal welfare. We made this same determination 
for wholesalers with four or fewer breeding females, who are exempted 
under Sec.  2.1(a)(3)(iii). We therefore intend to retain these 
exemptions, with four or fewer breeding female dogs, cats, and small 
exotic or wild mammals sold at wholesale.
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    \4\ See pg. 562: http://www.gpo.gov/fdsys/pkg/CRPT-113hrpt333/pdf/CRPT-113hrpt333.pdf.
    \5\ See footnote 2.
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    We emphasize that the thresholds in the current exemptions for 
dealers are based on the total number of breeding females of all 
species combined on a premises, not four breeding female animals per 
each species. For example, if a breeder selling AWA-covered species at 
retail or wholesale has a total of three breeding female dogs and two 
breeding female guinea pigs, that breeder could not claim an exemption, 
as the total number of AWA-covered breeding females the person 
maintains is five breeding females and exceeds the threshold of four 
breeding females. We would apply the same provision to any person 
seeking a de minimis exemption for breeding females under our proposed 
changes. We expect, however, that most wholesale and retail dealers 
eligible for a de minimis exemption under this proposal are already 
eligible for the current licensing exemptions in Sec.  2.1(a)(3) of the 
regulations.
    In addition to dealers, in section 12308 of the 2014 Farm Bill, 
Congress amended the Act (7 U.S.C. 2132) to provide the Secretary with 
the authority to establish a de minimis exemption from licensing for 
exhibitors. In determining de minimis thresholds for such businesses, 
we would consider the risk to the humane care and treatment of animals, 
the total number of AWA-regulated animals maintained, the type of 
activity for which the animals are being used, and/or the number of 
days per year the animals are exhibited.

Contingency Plans Rule

    On December 31, 2012, we published a final rule \6\ establishing 
regulations under which research facilities, dealers, exhibitors, 
intermediate handlers, and carriers must meet certain requirements for 
contingency planning and training of personnel. However, on July 31, 
2013, we issued a stay \7\ of those regulations so that we could 
further consider the impact of plan requirements on regulated entities, 
taking into account different needs according to the type and size of 
their AWA-regulated business activities.
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    \6\ Docket No. APHIS-2006-0159 (77 FR 76815-76824).
    \7\ 78 FR 46255.
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    One issue that warranted further review was the impact of 
contingency planning and other licensing requirements on exhibitors 
whose businesses involve small numbers of animals. While these 
exhibitors do not typically pose risks to animal welfare, there was no 
legal mechanism for exempting them from licensing and contingency 
planning requirements as de minimis businesses. The amendment to the 
Act makes it possible to lift the stay on the Agency's contingency plan 
rule by allowing APHIS to determine certain exhibitors to be de minimis 
based on the size of their AWA-regulated business activities. We will 
review the impact of the AWA amendment on the contingency plan 
rulemaking and consider lifting the stay pending the final outcome of 
this rulemaking.

Proposed Changes to the Regulations

Definitions
    In response to the amendments made to the Act, we propose to amend 
the definitions of dealer and exhibitor in Sec.  1.1, ``Definitions.''
Dealer
    In Sec.  1.1 of the regulations, dealer is defined as any person 
who, in commerce, for compensation or profit, delivers for 
transportation, or transports, except as a carrier, buys, or sells, or 
negotiates the purchase or sale of: Any dog or other animal whether 
alive or dead (including unborn animals, organs, limbs, blood, serum, 
or other parts) for research, teaching, testing, experimentation, 
exhibition, or for use as a pet; or any dog at the wholesale level for 
hunting, security, or breeding purpose. The term excludes retail pet 
stores, as defined in the regulations, any retail outlet where dogs are 
sold for hunting, breeding, or security purposes; or any person who 
does not sell or negotiate the purchase or sale of any wild or exotic 
animal, dog, or cat and who derives no more than $500 gross income from 
the sale of animals other than wild or exotic animals, dogs, or cats 
during any calendar year.
    The 2014 Farm Bill amended the definition of ``dealer'' in Sec.  
2132(f) of the Act by striking language from the definition that 
excluded ``any person who does not sell, or negotiate the purchase or 
sale of any wild animal, dog, or cat, and who derives no more than $500 
gross income from the sale of other animals during any calendar year.''
    We propose to make the definition of dealer in Sec.  1.1 of the 
regulations consistent with the Act. We would do so by striking the 
statement that excludes as a dealer ``any person who does not sell or 
negotiate the purchase or sale of any wild or exotic animal, dog, or 
cat and who derives no more than $500 gross income from the sale of 
animals other than wild or exotic animals, dogs, or cats during any 
calendar year.''
Exhibitor
    In 2013, Congress amended \8\ the Act to exclude from the 
definition of ``exhibitor'' ``an owner of a common, domesticated 
household pet who derives less than a substantial portion of income 
from a nonprimary source (as determined by the Secretary) for 
exhibiting an animal that exclusively resides at the residence of the 
pet owner.'' We propose to amend the definition of exhibitor in Sec.  
1.1 of the regulations by adding this exclusion to it, thereby making 
it consistent with the definition in the Act. While we have not defined 
``substantial portion of income'' in the proposed regulation, we 
interpret this to mean that the income generated from exhibition is the 
main source of the person's income. We interpret less-than-substantial 
income to mean the exhibition generates a minimal amount of money and 
does not constitute a main source of the person's income. We seek 
comment on this interpretation and whether we should add it to the 
regulatory text.
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    \8\ S. 3666; Public Law: 112-261.
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De Minimis Exemptions to Licensing
    We propose to make changes and additions to the licensing 
exemptions in Sec.  2.1(a)(3) so that the AWA regulations are 
consistent with the Act, as amended. These changes include adding de 
minimis exemption requirements in new paragraphs Sec.  2.1(a)(3)(ix) 
through Sec.  2.1(a)(3)(xii) and including a table summarizing the de 
minimis exemption

[[Page 51389]]

thresholds in a new paragraph Sec.  2.1(a)(3)(xiii).
    The de minimis exemptions would apply only to the activities of 
those dealers and exhibitors that fall under the scope of the Act and 
are not already excluded or exempted from APHIS licensing and 
inspection. We note that the Act excludes from regulation farm animals 
that are used or intended for use as food or fiber, or for improving 
animal nutrition, breeding, management, or production efficiency. 
Accordingly, the AWA regulations exclude farm animals used under 
certain circumstances from the definition of ``animal'' in Sec.  1.1 
and exempt other animals used for food and fiber in Sec.  
2.1(a)(3)(vi). None of these regulations would be changed by this 
proposal. However, farm animals used or exhibited for regulated 
purposes, such as petting zoos, would continue to fall under the scope 
of the Act unless they otherwise qualify for a de minimis exemption 
from licensing.
    As noted previously, we propose no changes to the current retail 
licensing exemptions in Sec.  2.1(a)(3)(i) and (a)(3)(iii) or the 
exemption in Sec.  2.1(a)(3)(vii), and persons exempted under these 
provisions would not be affected by this proposal. Retailers exempted 
under the retail pet store licensing exemption who sell the offspring 
of their breeding females solely in face-to-face customer transactions 
would not be affected by the proposed de minimis requirements, 
regardless of the number of breeding females they maintain. However, to 
make the regulations consistent with the amended Act, we are proposing 
to remove in its entirety the $500 gross income exemption from 
licensing currently in Sec.  2.1(a)(3)(ii). This exemption parallels 
the exclusion we are proposing to remove from the definition of dealer 
in Sec.  1.1. In its place, we would add language that exempts from 
licensing any person whose business is determined by APHIS to be de 
minimis in accordance with the proposed regulations in Sec.  2.1(a)(3).
    We propose in a new Sec.  2.1(a)(3)(ix) to establish a de minimis 
exemption for any person who maintains a total of four or fewer 
breeding female dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, and who sells, at retail or 
wholesale, only the offspring of these animals, which were born and 
raised on his or her premises, and is not otherwise required to obtain 
a license. As is the case with the current licensing exemptions, this 
de minimis exemption from licensing as a dealer would not extend to any 
person residing in a household that collectively maintains a total of 
more than four such breeding female animals, regardless of ownership, 
nor to any person maintaining such breeding female animals on premises 
on which more than four such breeding female animals are maintained, 
nor to any person acting in concert with others where they collectively 
maintain a total of more than four such breeding female animals, 
regardless of ownership. The animals listed as eligible for the 
proposed de minimis exemption were chosen because they are common 
domesticated animals with a well-established history of known welfare 
standards. Again, businesses already exempted under current licensing 
exemptions would not be affected by this proposed exemption, nor would 
sales of farm animals be affected if they are sold for the purpose of 
improving animal nutrition, breeding, management, or production 
efficiency, or for food or fiber.

Exhibitor Exemptions

    As indicated above, we also propose to establish de minimis 
thresholds for some businesses engaged in AWA-covered exhibition 
activities. This action would exempt exhibitors considered to be de 
minimis from licensing if they meet the proposed thresholds and relieve 
them of the requirement to perform the reporting and recordkeeping 
activities associated with licensing.
    The de minimis thresholds we propose to include for exhibitors 
would be based on the size of their AWA-related business activity as 
measured by the total number of animals maintained, the type of 
exhibitor activity, and/or the duration of exhibition (as measured in 
days). However, there are situations that preclude de minimis 
consideration for certain exhibitors. In the Conference Report 
accompanying the 2014 Farm Bill amendments to the Act, Congress 
indicated that ``an exhibitor's business must not be considered de 
minimis merely because the facility operates as a non-profit 
corporation, nor is the exhibition of a small number of dangerous 
animals (including, but not limited to, big cats, bears, wolves, 
nonhuman primates, or elephants) de minimis.''
    In a new Sec.  2.1(a)(3)(x), we would establish a de minimis 
licensing exemption for people in a household who in total maintain 
four or fewer dogs, cats, rabbits, hamsters, guinea pigs, chinchillas, 
cows, goats, pigs, and sheep, for exhibition and who houses the animals 
at a site for year-round exhibition, and is not otherwise required to 
obtain a license. This exemption for a license as an exhibitor would 
not extend to any person residing in a household that collectively 
maintains a total of more than four such animals, regardless of 
ownership, nor to any person maintaining such animals on premises on 
which more than four such animals are maintained, nor to any person 
acting in concert with others where they collectively maintain a total 
of more than four such animals, regardless of ownership.
    Based on our extensive knowledge and experience of animals used for 
year-round exhibition purposes, we determined the threshold for this 
exemption to be four, as exhibitors with a small number of common, 
domesticated, non-dangerous animals are capable of providing adequate 
care and treatment for the animals involved in regulated business 
activities, based on compliance data on currently licensed exhibitors.
    In a new Sec.  2.1(a)(3)(xi), we would also include de minimis 
licensing exemptions for certain persons using animals in seasonal 
exhibitions. The exemption would apply to any person who maintains a 
total of eight or fewer dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, for seasonal exhibition 
only, and who exhibits any or all of the animals for no more than 30 
days per calendar year, and is not otherwise required to obtain a 
license. This exemption would not extend to any person residing in a 
household that collectively maintains a total of more than eight such 
animals, regardless of ownership, nor to any person maintaining eight 
such animals on premises on which more than eight such animals are 
maintained, nor to any person acting in concert with others where they 
collectively maintain a total of more than eight such animals, 
regardless of ownership.
    We determined the de minimis threshold for seasonal exhibition to 
be eight common, domesticated, non-dangerous animals based on the fact 
that, unlike animals exhibited year-round, animals exhibited seasonally 
are displayed to the public for a minimal period of time (30 days or 
less each year) during holiday seasons such as Easter, Halloween, 
Thanksgiving, and Christmas.\9\
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    \9\ Thirty days or less is consistent with the average number of 
days when many exhibitors are displaying animals intermittently or 
infrequently for limited duration (as measured in days). Examples of 
such exhibitions include, but are not limited to, seasonal petting 
zoos (e.g. exhibits open for Halloween or from Thanksgiving to 
Christmas), college game mascots, magic shows, rabbits used for 
photo shoots during Easter season (half hour sessions over a 2-3 
week period; petting zoos with farm animals during pumpkin harvest 
season (lasting less than 30 days), and nativity scenes during the 
Christmas season (usually 21-30 days).

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[[Page 51390]]

    We based our determination of 30 or fewer days for this exemption 
on our experience with inspecting seasonal exhibitors holding a small 
number of common, domesticated, non-dangerous animals, which indicates 
that exhibitors with animals displayed to the public for 30 days or 
less annually are capable of providing adequate care and treatment for 
the animals involved in the exhibition.
    Persons exhibiting regulated animals not included in the proposed 
thresholds table would not be eligible for a de minimis exemption, 
regardless of the duration (as measured in days) for which the animals 
are exhibited. For example, camels, bison, and reindeer are sometimes 
included in seasonal holiday exhibits, but their behavior and size set 
them apart from common, non-dangerous domestic livestock displayed in 
such exhibits, and under the regulations they are considered to be wild 
or exotic species.
    In 2013, Congress amended \10\ the definition of ``exhibitor'' in 
the Act to exclude certain persons as exhibitors, namely ``any owner of 
a common, domesticated household pet who derives less than a 
substantial portion of income from a nonprimary source (as determined 
by the Secretary) for exhibiting an animal that exclusively resides at 
the residence of the pet owner.'' In order to make the regulations 
consistent with the Act, we propose to add this amendment to the list 
of exclusions under the definition of ``exhibitor'' in Sec.  1.1 of the 
regulations.
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    \10\ See footnote 8.
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    The exclusion from the definition of ``exhibitor'' under the Act is 
only applicable to persons meeting all the criteria listed in the 
amendment. Similarly, under our proposed revision of ``exhibitor'' in 
the regulations, a person exhibiting other than a ``common, 
domesticated household pet'' would not be eligible for the exclusion. 
Also, persons who derive their primary source of income from exhibiting 
the animals, or who generate a substantial amount of money from such 
exhibition as determined by APHIS, would not be eligible for the 
exclusion. We interpret ``less than a substantial portion of income'' 
in the Act to mean a minimal amount of money that the owner makes from 
exhibiting animals. We interpret ``a nonprimary source'' to mean the 
activity is not a full-time job or primary source of income.
    Many persons eligible for this exclusion employ one or more common, 
domesticated household pets in intermittent or infrequent exhibition, 
such as brief film and television appearances. Based on the industry 
pay rates for pet animal film work \11\ and on our experience from 
working with small exhibitors, we determined that persons with four or 
fewer common domesticated household pet animals that are exhibited 
infrequently or intermittently generate a less than substantial portion 
of income and therefore meet the requirements for the exclusion. By 
being excluded from the definition of ``exhibitor'', they are not 
required to be licensed.
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    \11\ According to the Screen Actors Guild-American Federation of 
Television and Radio Artists 2013 pay rate scale for background 
actors, the average pay per background appearance in a film or 
television production ranges from $39 to $224.
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    Therefore, we propose to include a regulatory licensing exemption 
in a new Sec.  2.1(a)(3)(xii) for any person who maintains a total of 
four or fewer common, domesticated household pet animals, who uses them 
for intermittent or infrequent exhibition for no more than 30 days per 
calendar year, who derives less than a substantial portion of income 
from a nonprimary source for exhibiting such animals, whose animals 
reside exclusively at the residence of the owner, and who is not 
otherwise required to obtain a license. This exemption would not extend 
to any person residing in a household that collectively maintains a 
total of more than four pet animals, regardless of ownership, nor to 
any person maintaining pet animals on premises on which more than four 
pet animals are maintained, nor to any person acting in concert with 
others where they collectively maintain a total of more than four pet 
animals, regardless of ownership.
    We determined the total number of animals for this exemption to be 
four because our experience indicates that exhibitors who maintain and 
exhibit four or fewer animals and those who exhibit resident pet 
animals infrequently or intermittently (i.e., no more than 30 days per 
year) for minimal amounts of money are capable of providing adequate 
care and treatment for the animals involved in the regulated business 
activities without Federal licensing and inspection requirements to 
ensure animal welfare. Additionally, exhibitors with four or fewer 
animals are less likely to generate a substantial income as a primary 
source from exhibiting such animals compared to persons exhibiting with 
larger numbers of animals as the primary source of income.
    For easier reference, we also propose adding to the regulations a 
new Sec.  2.1(a)(3)(xiii) that includes a summary table of the de 
minimis threshold requirements included in paragraphs (a)(3)(ix) 
through (a)(3)(xii).
    The proposed thresholds are ultimately based on our experience that 
businesses conducting AWA-regulated activities with the animals 
indicated for each threshold present a minimal risk to animal welfare 
and therefore do not require APHIS licensing and inspection. However, 
the list of animals eligible for de minimis consideration is not 
intended to be exhaustive. We encourage public comment on the proposed 
exemption thresholds as they pertain to animal welfare and effects on 
businesses engaged in the breeding, dealing, or exhibition of animals. 
We also invite comments on the types of exhibition proposed in the 
table, particularly with regard to types of animals and exhibition 
business models that may not be represented here.

Miscellaneous

    We are also proposing to amend the regulations to remove a 
redundant provision. We would remove from Sec.  2.1(c)(2) the phrase 
``and, in the case of a license renewal, the annual license fee has 
been received by the appropriate Animal Care regional office on or 
before the expiration date of the license.'' This phrase is unnecessary 
because the same provision is repeated in paragraph (d)(1) of that 
section. In addition, we are proposing to remove Sec. Sec.  3.28(b), 
3.53(b), and 3.80(b)(1). These sections contain obsolete sheltering and 
minimum space requirements for dogs, cats, guinea pigs, hamsters, 
rabbits, and nonhuman primates that have been since replaced by updated 
sheltering and minimum space requirements. Removal of the obsolete 
requirements will minimize confusion with the current regulatory 
requirements and will have no impact on facilities and animal welfare. 
Similarly, we are revising Sec.  3.6(a)(2)(xii) to remove phase-in 
dates which are no longer needed regarding primary enclosures for dogs 
and cats.

Executive Orders 12866 and 13563 and Regulatory Flexibility Act

    This proposed rule has been determined to be significant for the 
purposes of Executive Order 12866 and, therefore, has been reviewed by 
the Office of Management and Budget.
    We have prepared an economic analysis for this rule. The economic 
analysis provides a cost-benefit analysis, as required by Executive 
Orders 12866 and 13563, and an initial regulatory flexibility analysis 
that examines the

[[Page 51391]]

potential economic effects of this proposed rule on small entities, as 
required by the Regulatory Flexibility Act. The economic analysis is 
summarized below. Copies of the full analysis are available by 
contacting the person listed under FOR FURTHER INFORMATION CONTACT or 
on the Regulations.gov Web site (see ADDRESSES above for instructions 
for accessing Regulations.gov).
    A 2014 Farm Bill amendment to the Animal Welfare Act provides the 
Secretary of Agriculture with the authority to determine when animal 
dealers and exhibitors are not required to obtain a license under the 
Act if the size of the business conducting AWA-related activities is 
determined by the Secretary to be de minimis. Businesses considered to 
be de minimis are capable of providing adequate care and treatment to 
the animals involved in the regulated business activities without 
Federal licensing and inspection requirements to ensure animal welfare. 
This proposal would establish de minimis thresholds for businesses 
engaged in breeding, selling, or exhibiting certain regulated animals 
and include the thresholds in the regulations. We would measure 
business size using various criteria, including number of breeding 
female animals maintained, number of animals exhibited, and the 
duration of exhibition (as measured in days). We are also amending the 
AWA regulations in response to a 2013 amendment to the Act excluding 
from the statutory definition of ``exhibitor'' owners of household pets 
that are exhibited infrequently or intermittently, generate less than a 
substantial portion of income, and reside exclusively with the owner. 
Dealers and exhibitors operating at or below the thresholds determined 
for their particular business activity would be exempted from Federal 
licensing requirements established under the Animal Welfare Act. These 
proposed actions would amend the regulations to be consistent with the 
Act while continuing to ensure the humane care and treatment of 
animals.
    APHIS' experience indicates that exhibitors who maintain or 
infrequently exhibit a small number of certain common non-dangerous 
animals are capable of providing adequate care and treatment to the 
animals involved in regulated business activities without Federal 
licensing and inspection requirements to ensure animal welfare. Because 
of the size of the business and their ability to provide adequate care 
and treatment, we consider such businesses to be engaged in a de 
minimis level of regulated activities. Establishing de minimis 
thresholds for exclusion or exemption from the AWA licensing 
requirements outlined in this proposal would allow APHIS to direct 
inspection and enforcement efforts on larger businesses conducting such 
activities.
    By the very nature of this proposal, all entities that would be 
affected are considered small. The entities most likely to be affected 
by this proposal are businesses engaged in AWA-related exhibition 
activities that have small numbers of regulated animals. This proposed 
rule would relieve regulatory responsibilities for some currently 
licensed entities and reduce the cost of business for those entities. 
Those currently licensed exhibitors and dealers (including breeders 
meeting the definition of ``dealer'') who are under the proposed de 
minimis thresholds would no longer be subject to licensing, animal 
identification, and recordkeeping requirements.
    The cost of a license for the smallest entities is between $40 and 
$85 annually. Identification tags for dogs and cats cost from $1.12 to 
$2.50 each. Other covered animals can be identified by a label attached 
to the primary enclosure containing a description of the animals in the 
enclosure at negligible cost. We estimate that the average currently 
licensed entity potentially affected by this proposal spends about 10 
hours annually to comply with the licensing paperwork and recordkeeping 
requirements. All of the currently licensed entities that would be 
considered de minimis under this proposal would benefit from reduced 
costs for licensing, identification, and recordkeeping. We estimate 
that approximately 212 currently licensed exhibitors, breeders, and 
dealers would no longer require licensing following implementation of 
this proposal (See the economic analysis for more detail on how we 
estimated this). We estimate that the cost savings for all these 
entities could total about $41,400 annually.
    Based on our review of available information, APHIS does not expect 
the proposed rule to have a significant economic impact on small 
entities. We have prepared the initial regulatory flexibility analysis 
because we need public input to help establish the total number of 
entities that will be affected. While we have yet to determine the 
total number of entities that would fall below the thresholds we 
propose, those entities that do fall below the thresholds would benefit 
from the rule. Those currently licensed entities that do not fall below 
the thresholds would see no additional economic impact as a result of 
this rule. In the absence of apparent significant economic impacts, we 
have not identified alternatives that would minimize such impacts.

Executive Order 12372

    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 2 CFR chapter IV.)

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It is not intended to have retroactive effect. 
The Act does not provide administrative procedures which must be 
exhausted prior to a judicial challenge to the provisions of this rule.

Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' Executive Order 13175 requires Federal agencies 
to consult and coordinate with tribes on a government-to-government 
basis on policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects 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.
    The Animal and Plant Health Inspection Service has assessed the 
impact of this rule on Indian tribes and determined that this rule does 
not, to our knowledge, have tribal implications that require tribal 
consultation under Executive Order 13175. If a Tribe requests 
consultation, APHIS will work with the Office of Tribal Relations to 
ensure meaningful consultation is provided where changes, additions and 
modifications identified herein are not expressly mandated by Congress.

Paperwork Reduction Act

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

List of Subjects in 9 CFR Parts 1, 2, and 3

    Animal welfare, Marine mammals, Pets, Reporting and recordkeeping 
requirements, Research, Transportation.



[[Page 51392]]


    Accordingly, we propose to amend 9 CFR parts 1, 2, and 3 as 
follows:

PART 1--DEFINITION OF TERMS

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

    Authority:  7 U.S.C. 2131-2159; 7 CFR 2.22, 2.80, and 371.7.

0
2. Section 1.1 is amended as follows:
0
a. By revising the definition of dealer.
0
b. By revising the definition of exhibitor.
    The revisions read as follows:


Sec.  1.1  Definitions.

* * * * *
    Dealer means any person who, in commerce, for compensation or 
profit, delivers for transportation, or transports, except as a 
carrier, buys, or sells, or negotiates the purchase or sale of: Any dog 
or other animal whether alive or dead (including unborn animals, 
organs, limbs, blood, serum, or other parts) for research, teaching, 
testing, experimentation, exhibition, or for use as a pet; or any dog 
at the wholesale level for hunting, security, or breeding purposes. 
This term does not include: A retail pet store, as defined in this 
section; or any retail outlet where dogs are sold for hunting, 
breeding, or security purposes.
* * * * *
    Exhibitor means any person (public or private) exhibiting any 
animals, which were purchased in commerce or the intended distribution 
of which affects commerce, or will affect commerce, to the public for 
compensation, as determined by the Secretary, and such term includes 
carnivals, circuses, and zoos exhibiting such animals whether operated 
for profit or not; but such term excludes retail pet stores, an owner 
of a common, domesticated household pet who derives less than a 
substantial portion of income from a nonprimary source (as determined 
by the Secretary) for exhibiting an animal that exclusively resides at 
the residence of the pet owner, organizations sponsoring and all 
persons participating in State and country fairs, livestock shows, 
rodeos, purebred dog and cat shows, and any other fairs or exhibitions 
intended to advance agricultural arts and sciences, as may be 
determined by the Secretary.
* * * * *

PART 2--REGULATIONS

0
3. The authority citation for part 2 continues to read as follows:

    Authority:  7 U.S.C. 2131-2159; 7 CFR 2.22, 2.80, and 371.7.

0
4. Section 2.1 is amended as follows:
0
a. By revising paragraph (a)(3)(ii).
0
b. By adding paragraphs (a)(3)(ix) through (a)(3)(xiii).
0
c. By revising paragraph (c)(2).
    The revisions and additions read as follows:


Sec.  2.1  Requirements and application.

    (a) * * *
    (3) * * *
    (ii) Any person whose AWA-related business activity is determined 
by APHIS to be de minimis in accordance with the regulations in this 
section;
* * * * *
    (ix) Any person who maintains a total of four or fewer breeding 
female dogs, cats, rabbits, hamsters, guinea pigs, chinchillas, cows, 
goats, pigs, and sheep, and who sells, at retail or wholesale, only the 
offspring of these dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, which were born and raised 
on his or her premises, and is not otherwise required to obtain a 
license. This exemption does not extend to any person residing in a 
household that collectively maintains a total of more than four 
breeding female dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, regardless of ownership, nor 
to any person maintaining breeding female dogs, cats, rabbits, 
hamsters, guinea pigs, chinchillas, cows, goats, pigs, and sheep on 
premises on which more than four breeding female dogs, cats, rabbits, 
hamsters, guinea pigs, chinchillas, cows, goats, pigs, and sheep are 
maintained, nor to any person acting in concert with others where they 
collectively maintain a total of more than four breeding female dogs, 
cats, rabbits, hamsters, guinea pigs, chinchillas, cows, goats, pigs, 
and sheep, regardless of ownership.
    (x) Any person who maintains a total of four or fewer dogs, cats, 
rabbits, hamsters, guinea pigs, chinchillas, cows, goats, pigs, and 
sheep, for exhibition and houses the animals permanently at the site 
where they are exhibited year-round, and is not otherwise required to 
obtain a license. This exemption does not extend to any person residing 
in a household that collectively maintains a total of more than four 
dogs, cats, rabbits, hamsters, guinea pigs, chinchillas, cows, goats, 
pigs, and sheep, regardless of ownership, nor to any person maintaining 
dogs, cats, rabbits, hamsters, guinea pigs, chinchillas, cows, goats, 
pigs, and sheep on premises on which more than four dogs, cats, 
rabbits, hamsters, guinea pigs, chinchillas, cows, goats, pigs, and 
sheep are maintained, nor to any person acting in concert with others 
where they collectively maintain a total of more than four dogs, cats, 
rabbits, hamsters, guinea pigs, chinchillas, cows, goats, pigs, and 
sheep, regardless of ownership.
    (xi) Any person who maintains a total of eight or fewer dogs, cats, 
rabbits, hamsters, guinea pigs, chinchillas, cows, goats, pigs, and 
sheep, for seasonal exhibition and exhibits any or all of the animals 
for no more than 30 days per calendar year, and is not otherwise 
required to obtain a license. This exemption does not extend to any 
person residing in a household that collectively maintains a total of 
more than eight dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, regardless of ownership, nor 
to any person maintaining eight dogs, cats, rabbits, hamsters, guinea 
pigs, chinchillas, cows, goats, pigs, and sheep on premises on which 
more than eight dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep are maintained, nor to any 
person acting in concert with others where they collectively maintain a 
total of more than eight dogs, cats, rabbits, hamsters, guinea pigs, 
chinchillas, cows, goats, pigs, and sheep, regardless of ownership.
    (xii) Any person who maintains a total of four or fewer common, 
domesticated, non-dangerous household pet animals for infrequent or 
intermittent exhibition for no more than 30 days per calendar year, who 
derives less than a substantial portion of income from a nonprimary 
source for exhibiting such animals, whose animals reside exclusively at 
the residence of the owner, and who is not otherwise be required to 
obtain a license. This exemption would not extend to any person 
residing in a household that collectively maintains a total of more 
than four pet animals, regardless of ownership, nor to any person 
maintaining pet animals on premises on which more than four pet animals 
are maintained, nor to any person acting in concert with others where 
they collectively maintain a total of more than four pet animals, 
regardless of ownership.
    (xiii) Following is a summary of the de minimis exemption 
requirements for paragraphs (ix) to (xii) of this section:

[[Page 51393]]



                           Table 1--De Minimis Thresholds for Exemption From Licensing
----------------------------------------------------------------------------------------------------------------
                                                              De minimis thresholds (exempt from licensing if at
                                                                     or  below all indicated thresholds)
                                                            ----------------------------------------------------
             Animals                       Activity                                           Maximum number of
                                                                Number of       Number of     days exhibited per
                                                                breeding      total animals   year  (any or all
                                                                 females                     animals  exhibited)
----------------------------------------------------------------------------------------------------------------
Dogs, Cats, Rabbits, Hamsters,     Breeding/selling retail                4  ..............  NA.
 Guinea pigs, Chinchillas, Cows,    (unless covered by       ..............  ..............  ...................
 Goats, Pigs, Sheep.                another exemption \1\).               4  ..............  NA.
                                   Breeding/selling
                                    wholesale (unless
                                    covered by another
                                    exemption \2\).
                                   Exhibition of all types   ..............               4  No maximum.
                                    (unless listed below).
                                   Seasonal exhibition (for  ..............               8  30 days.
                                    example nativity scenes
                                    and petting zoos
                                    operating part of the
                                    year).
Common, domesticated pet animals   Infrequent or             ..............               4  30 days.
 living in owner's residence.       intermittent
                                    exhibitions (for
                                    example, film and
                                    television appearances,
                                    team mascots, canine
                                    disc competitions,
                                    magic shows) from which
                                    less than a substantial
                                    portion of income from
                                    a nonprimary source is
                                    derived.
----------------------------------------------------------------------------------------------------------------
Farm animals bred, sold, exhibited, or otherwise used solely for agricultural purposes and animals used solely
  for food or fiber are exempt from the licensing requirements of this section.
\1\ Includes retail businesses exempted under paragraphs (a)(3)(i) and (a)(3)(vii) of this section.
\2\ Includes wholesale businesses exempted under paragraph (a)(3)(iii) of this section.

* * * * *
    (c) * * *
    (2) The applicant has paid the application fee of $10 and the 
annual license fee indicated in Sec.  2.6 to the appropriate Animal 
Care regional office for an initial license.
* * * * *

PART 3--STANDARDS

0
5. The authority citation for part 3 continues to read as follows:

    Authority:  7 U.S.C. 2131-2159; 7 CFR 2.22, 2.80, and 371.7.

0
6. Section 3.6 is amended as follows:
0
a. By revising paragraph (a)(2)(xii).
0
b. By removing paragraph (b)(1)(i).
0
c. By removing paragraph (b)(1)(ii) introductory text.
0
d. By redesignating paragraphs (b)(1)(iii) and (b)(1)(iv) as paragraphs 
(b)(1)(iv) and b)(1)(v) respectively.
0
e. By redesignating paragraphs (b)(1)(ii)(A), (b)(1)(ii)(B), and 
(b)(1)(ii)(C) as paragraphs (b)(1)(i), (b)(1)(ii), and (b)(1)(iii) 
respectively.
    The revision reads as follows:


Sec.  3.6  Primary enclosures.

* * * * *
    (a) * * *
    (2) * * *
    (xii) If the suspended floor of a primary enclosure is constructed 
of metal strands, the strands must either be greater than \1/8\ of an 
inch in diameter (9 gauge) or coated with a material such as plastic or 
fiberglass. The suspended floor of any primary enclosure must be strong 
enough so that the floor does not sag or bend between the structural 
supports.
* * * * *


Sec.  3.28  [Amended]

0
7. Section 3.28 is amended as follows:
0
a. By removing paragraph (b).
0
b. By redesignating paragraph (c) as paragraph (b).
0
c. In the heading of newly redesignated paragraph (b), by removing the 
words ``acquired on or after August 15, 1990''.
0
d. In newly redesignated paragraph (b)(2)(iii), by removing the words 
``paragraph (c)(2)(iv)'' and adding the words ``paragraph (b)(2)(iv)'' 
in their place.
0
e. In newly redesignated paragraph (b)(3), by removing the words 
``paragraph (c)(1) or (c)(2)'' and adding the words ``paragraph (b)(1) 
or (b)(2)'' in their place.


Sec.  3.53  [Amended]

0
8. Section 3.53 is amended as follows:
0
a. By removing paragraph (b).
0
b. By redesignating paragraph (c) as paragraph (b).
0
c. In the heading of newly redesignated paragraph (b), by removing the 
words ``acquired on or after August 15, 1990''.
0
d. In newly redesignated paragraph (b)(3), by removing the words 
``paragraph (c)(2)'' and adding the words ``paragraph (b)(2)'' in their 
place.
0
9. Section 3.80 is amended as follows:
0
a. By removing paragraph (b)(1).
0
b. By removing the paragraph (b)(2) introductory text.
0
c. By redesignating paragraphs (b)(2)(i), (b)(2)(ii), (b)(2)(iii), and 
(b)(2)(iv), as paragraphs (b)(1), (b)(2), (b)(3), and (b)(4) 
respectively.
0
d. In newly redesignated paragraph (b)(1), footnote 4, by removing the 
words ``paragraph (b)(2)(ii)'' and adding the words ``paragraph 
(b)(2)'' in their place.
0
e. In newly redesignated paragraph (b)(2), by removing the words 
``paragraph (b)(2)(i)'' and adding the words ``paragraph (b)(1)'' in 
their place.
0
f. In newly redesignated paragraph (b)(4), by removing the words 
``paragraph (b)(2)(i)'' and adding the words ``paragraph (b)(1)'' in 
their place.
0
g. By revising paragraph (c).
    The revision reads as follows:


Sec.  3.80  Primary enclosures.

* * * * *
    (c) Innovative primary enclosures not precisely meeting the floor 
area and height requirements provided in paragraph (b) of this section, 
but that do provide nonhuman primates with a sufficient volume of space 
and the opportunity to express species-typical behavior, may be used at 
research facilities when approved by the Committee, and by dealers and 
exhibitors when approved by the Administrator.
* * * * *


[[Page 51394]]


    Done in Washington, DC, this 29th day of July 2016.
Edward Avalos,
Under Secretary for Marketing and Regulatory Programs.
[FR Doc. 2016-18452 Filed 8-3-16; 8:45 am]
 BILLING CODE 3410-34-P