[Federal Register Volume 81, Number 189 (Thursday, September 29, 2016)]
[Rules and Regulations]
[Pages 66833-66842]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-22061]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 543

[Docket No. NHTSA-2014-0007]
RIN 2127-AL08


Exemption From Vehicle Theft Prevention Standard

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Final rule.

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SUMMARY: In this rulemaking action, NHTSA is finalizing procedures for 
obtaining an exemption from the vehicle theft prevention standard for 
vehicles equipped with immobilizers.
    An immobilizer is an anti-theft device that combines microchip and 
transponder technology with engine and fuel immobilizer components that 
can prevent vehicles from starting unless a verified code is received 
by the transponder. This final rule streamlines the exemption procedure 
for immobilizer-equipped vehicles by adding performance criteria for 
immobilizers. The criteria, which roughly correlate with the types of 
qualities for which petitioners have been submitting testing and 
technical design details under existing procedures, closely follow the 
immobilizer performance requirements in the anti-theft standard of 
Canada. After this final rule, it would be sufficient for a 
manufacturer seeking the exemption of some of its vehicles to provide 
data showing that the device meets the performance criteria, as well as 
a statement that the device is durable and reliable. Adopting these 
performance criteria for immobilizers bring the U.S. anti-theft 
requirements more into line with those of Canada.

DATES: Effective Date: This rule is effective November 28, 2016.
    Petitions for Reconsideration: Petitions for reconsideration of 
this final rule must be received not later than November 14, 2016.

ADDRESSES: Petitions for reconsideration of this final rule must refer 
to the docket and notice number set forth above and be submitted to the 
Administrator, National Highway Traffic Safety Administration, 1200 New 
Jersey Avenue, SE., Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: 
    For technical issues: Mr. Hisham Mohamed, Office of Consumer 
Programs, NHTSA, 1200 New Jersey Avenue SE., West Building, Washington, 
DC 20590 (Telephone: (202) 366-0307) (Fax: (202) 493-2990).
    For legal issues: Mr. Ryan Hagen, Office of the Chief Counsel, 
NHTSA, 1200 New Jersey Avenue SE., West Building, Washington, DC 20590 
(Telephone: (202) 366-2992) (Fax: (202) 366-3820).

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Executive Summary
II. Background
    A. Effectiveness of Immobilizers in Reducing or Deterring Theft
    B. U.S. Canada Regulatory Cooperation Council
    C. Canadian Motor Vehicle Safety Standard No. 114
III. Proposed Rule
IV. Overview of Comments
V. Response to Comments and Differences Between the Final Rule and 
NPRM
VI. Costs, Benefits, and Compliance Date
VII. Regulatory Notices and Analyses

I. Executive Summary

    This rulemaking action amends 49 CFR part 543, Exemption from 
Vehicle Theft Prevention Standard, by adding performance criteria for 
immobilizers. The agency has granted many exemptions from the theft 
prevention standard to vehicle lines on the basis that they were 
equipped with immobilizers. In support of petitions for these 
exemptions, manufacturers have provided a substantial amount of data 
seeking to demonstrate the effectiveness of immobilizers in reducing 
motor vehicle theft.
    The criteria, which roughly correlate with the types of qualities 
for which petitioners have been submitting testing and technical design 
details under existing procedures, use the same four performance 
requirements from the Transport Canada standard. For those performance 
requirements, the Canadian standard also sets forth tests that 
manufacturers of vehicles to be sold in Canada must certify to Canadian 
authorities that they have conducted.

[[Page 66834]]

    Adopting these performance criteria would simplify the exemption 
process for manufacturers who installed immobilizers meeting those 
criteria. Currently, in their petitions for exemption, vehicle 
manufacturers describe the testing that they have conducted on the 
immobilizer device and aspects of design of the immobilizer that 
address the areas of performance which the agency has determined are 
important to gauge the effectiveness of the immobilizer in reducing and 
deterring motor vehicle theft. Adding performance criteria for 
immobilizers as another means of qualifying for an exemption from the 
U.S. theft prevention standard will allow manufacturers that are 
installing immobilizers as standard equipment for a line of motor 
vehicles in compliance with Canadian theft prevention standards to more 
easily gain an exemption here. This would reduce the amount of material 
that manufacturers would need to submit to obtain an exemption because 
manufacturers would only be required to indicate and demonstrate that 
the immobilizer met the performance criteria and was durable and 
reliable to be eligible for an exemption.
    This final rule allows manufacturers to obtain an exemption from 
the theft prevention standards by complying with any of the four 
performance criteria currently accepted by Transport Canada. The 
adoption of the performance criteria for immobilizers would bring the 
U.S. anti-theft requirements more into line with those of Canada. This 
harmonization of U.S. and Canadian requirements is being undertaken 
pursuant to ongoing bilateral regulatory cooperation efforts. 
Additionally, two of the performance criteria added by this rule are 
United Nations Economic Commission for Europe (UN/ECE) standards, which 
will allow for greater global harmonization.
    We are retaining the current criteria for gaining an exemption from 
the vehicle theft prevention standard. Therefore, manufacturers would 
still be able to petition the agency to install other anti-theft 
devices as standard equipment in a vehicle line to obtain an exemption 
from the theft prevention standard. While NHTSA has granted many 
petitions for exemption from the theft prevention standard for vehicle 
lines equipped with an immobilizer type anti-theft device, we note that 
a manufacturer is not required to install an immobilizer in order to 
gain an exemption. We note also that this would not increase the number 
of exemptions from the theft prevention standard available to a 
manufacturer.

II. Background

    The Motor Vehicle Theft Law Enforcement Act (the Theft Act), 49 
U.S.C. 33101 et seq., directs NHTSA \1\ to establish theft prevention 
standards for light duty trucks and multipurpose passenger vehicles 
(MPVs) with a gross vehicle weight rating of 6,000 pounds or less and 
passenger cars. The Theft Act also allows NHTSA to exempt one vehicle 
line per model year per manufacturer from the theft prevention standard 
if the vehicle is equipped with an anti-theft device that the agency 
``decides is likely to be as effective in reducing and deterring motor 
vehicle theft as compliance with the [theft prevention] standard.'' 49 
U.S.C. 33106(b). The statute states that in order to obtain an 
exemption, manufacturers must file a petition that describes the anti-
theft device in detail, states the reason that the manufacturer 
believes that the device will be effective in reducing or deterring 
theft, and contains additional information that NHTSA determines is 
necessary to decide whether the anti-theft device ``is likely to be as 
effective in reducing and deterring motor vehicle theft as compliance 
with the [theft prevention] standard.'' \2\
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    \1\ The Secretary of Transportation's responsibilities under the 
Theft Act have been delegated to NHTSA pursuant to 49 CFR 1.95.
    \2\ Id.
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    Pursuant to the Theft Act, NHTSA issued 49 CFR part 541, Federal 
Motor Vehicle Theft Prevention Standard, which requires manufacturers 
of vehicles identified by the agency as likely high-theft vehicle lines 
to inscribe or affix vehicle identification numbers or symbols on 
certain components of new vehicles and replacement parts.\3\ The agency 
refers to this requirement as the parts marking requirement.
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    \3\ Part 541 requires the following major parts to be marked: 
The engine, the transmission, the hood, the right and left front 
fenders, the right and left front doors, the right and left rear 
door (four-door models), the sliding or cargo doors, the decklid, 
tailgate or hatchback (whichever is present), the front and rear 
bumpers, and the right and left quarter panels. The right and left 
side assemblies must be marked on MPVs and the cargo box must be 
marked on light duty trucks.
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    NHTSA promulgated part 543 to establish the process for submitting 
petitions for exemption from the parts marking requirements in the 
theft prevention standard. A manufacturer may petition the agency for 
an exemption from the parts marking requirements for one vehicle line 
per model year if the manufacturer installs an anti-theft device as 
standard equipment on the entire line. In order to be eligible for an 
exemption, part 543 requires manufacturers to submit a petition 
explaining how the anti-theft device will promote activation, attract 
attention to the efforts of unauthorized persons to enter or operate a 
vehicle by means other than a key, prevent defeat or circumvention of 
the device by unauthorized persons, prevent operation of the vehicle by 
unauthorized entrants, and ensure the reliability and durability of the 
device. Based on the materials in the petition, NHTSA decides whether 
to grant the petition in whole or in part or to deny it.
    Under the existing part 543, manufacturers choose how they wish to 
demonstrate to the agency that the anti-theft device they are 
installing in a vehicle line meets the factors listed in Sec.  543.6. 
Manufacturers provide differing levels of detail in their exemption 
petitions. Manufacturers typically provide engineering diagrams of the 
anti-theft device, a description of how the device functions, and 
testing to show that the device is durable and reliable in their 
petitions for exemption. Manufacturers also describe how the design of 
the anti-theft device satisfies the factors listed in Sec.  543.6.

A. Effectiveness of Immobilizers in Reducing or Deterring Theft

    Nearly 700,000 motor vehicle thefts took place in the U.S. in 2013, 
causing a loss of mobility and economic hardship to those affected.\4\ 
The estimated value of motor vehicles stolen in 2011 was $4.1 billion, 
averaging $5,972 per stolen vehicle.\5\ Of the vehicles stolen in the 
United States, nearly 45 percent are never recovered.\6\ While the 
number of motor vehicle thefts fell 3.3 percent from 2012 to 2013, 
vehicle theft remains an ongoing problem in the U.S.\7\ According to 
the FBI, a motor vehicle was stolen every 45 seconds in 2013.\8\
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    \4\ https://www.fbi.gov/about-us/cjis/ucr/crime-in-the-u.s/2013/crime-in-the-u.s.-2013/property-crime/motor-vehicle-theft-topic-page/mvtheftmain_final.pdf (last accessed February 10, 2016).
    \5\ Id.
    \6\ http://www.nhtsa.gov/Vehicle+Safety/Vehicle-Related+Theft/Theft+Prevention (last accessed February 10, 2016).
    \7\ https://www.fbi.gov/about-us/cjis/ucr/crime-in-the-u.s/2013/crime-in-the-u.s.-2013/property-crime/motor-vehicle-theft-topic-page 
(last accessed February 10, 2016).
    \8\ http://www.trafficsafetymarketing.gov/newtsm/VehicleTheftPrevention/11539-VehicleTheftPrevention-FactSheet.pdf 
(last accessed February 10, 2016).
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    An immobilizer is a type of anti-theft device based on microchip 
and transponder technology and combined with engine and fuel 
immobilizer components. When activated, an immobilizer device disables 
the

[[Page 66835]]

vehicle's electrical or fuel systems at several points and prevents the 
vehicle from starting unless the correct code is received by the 
transponder.
    NHTSA is aware of several sources of information demonstrating the 
effectiveness of immobilizer devices in reducing motor vehicle theft. 
In the 1980s, General Motors Corporation (GM) used an early generation 
of microchip devices, which later developed into the rolling code 
transponder device, which is currently installed in GM as well as many 
other vehicles. According to the Highway Loss Data Institute (HLDI), 
immobilizer devices are up to 50 percent effective in reducing vehicle 
theft.\9\ The September 1997 Theft Loss Bulletin from the HLDI reported 
an overall theft decrease of approximately 50 percent for both the Ford 
Mustang and Taurus lines upon installation of an immobilizer device. 
Ford Motor Company claimed that its MY 1997 Mustang vehicle line (with 
an immobilizer) led to a 70 percent reduction in theft compared to its 
MY 1995 Mustang (without an immobilizer).\10\ Chrysler Corporation 
informed the agency that the inclusion of an immobilizer device as 
standard equipment on the MY 1999 Jeep Grand Cherokee resulted in a 52 
percent net average reduction in vehicle thefts.\11\
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    \9\ See http://www.iihs.org/iihs/news/desktopnews/theft-losses-decline-by-half-when-cars-are-equipped-with-immobilizing-antitheft-devices (last accessed February 10, 2016).
    \10\ 77 FR 1974 (January 12, 2012).
    \11\ 76 FR 68262 (November 3, 2011).
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    Mitsubishi Motors Corporation informed the agency that the theft 
rate for its MY 2000 Eclipse vehicle line (with an immobilizer device) 
was almost 42 percent lower than that of its MY 1999 Eclipse (without a 
immobilizer device).\12\ Mazda Motor Corporation reported that a 
comparison of theft loss data showed an average theft reduction of 
approximately 50 percent after an immobilizer device was installed as 
standard equipment in a vehicle line.\13\ In general, the agency has 
granted many petitions for exemptions for installation of 
immobilization-type devices. Manufacturers have provided the agency 
with a substantial amount of information attesting to the reduction of 
thefts for vehicle lines resulting from the installation of 
immobilization devices as standard equipment on those lines.
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    \12\ 77 FR 20486 (April 4, 2012).
    \13\ 76 FR 41558 (July 14, 2011).
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B. U.S. Canada Regulatory Cooperation Council

    On February 4, 2011, the U.S. and the Canadian governments created 
a United States-Canada Regulatory Cooperation Council (RCC), composed 
of senior regulatory, trade and foreign affairs officials from both 
governments. In recognition of the two countries' $1 trillion annual 
trade and investment relationship, the RCC is working together to 
promote economic growth, job creation and benefits to consumers and 
businesses through increased regulatory transparency and 
coordination.\14\
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    \14\ https://www.whitehouse.gov/sites/default/files/omb/oira/irc/us-canada-rcc-joint-forward-plan.pdf (last accessed February 10, 
2016).
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    On December 7, 2011, the RCC established an initial Joint Action 
Plan that identified 29 initiatives where the U.S. and Canada will seek 
greater alignment in their regulatory approaches. The Joint Action Plan 
highlights the areas and initiatives which were identified for initial 
focus. These areas include agriculture and food, transportation, health 
and personal care products and workplace chemicals, environment and 
cross-sectoral issues. One of the topics for regulatory cooperation 
identified in the transportation area is to pursue greater 
harmonization of existing motor vehicle standards. Theft prevention is 
one of the harmonization opportunities identified by the Motor Vehicles 
Working Group.

C. Canadian Motor Vehicle Safety Standard No. 114

    In addition to the theft and rollaway prevention requirements 
included in the U.S. version of the standard, CMVSS No. 114 requires 
the installation of an immobilization system for all new passenger 
vehicles, MPVs and trucks certified to the standard with a gross 
vehicle weight rating (GVWR) of 4,536 kg or less, with some exceptions. 
CMVSS No. 114 contains four different sets of requirements for 
immobilizers. The four sets of requirements are National Standard of 
Canada CAN/ULC-S338-98, Automobile Theft Deterrent Equipment and 
Systems: Electronic Immobilization (May 1998); United Nations Economic 
Commission for Europe (UN/ECE) Regulation No. 97 (ECE R97) in effect 
August 8, 2007, Uniform Provisions Concerning Approval of Vehicle Alarm 
System (VAS) and Motor Vehicles with Regard to Their Alarm System (AS); 
UN/ECE Regulation No. 116 (ECE R116), Uniform Technical Prescriptions 
Concerning the Protection of Motor Vehicles Against Unauthorized Use in 
effect on February 10, 2009; and a set of requirements derived from the 
CAN/ULC 338-98 standard and ECE R97 developed by Transport Canada to 
increase manufacturer design flexibility (in effect March 30, 2011). 
Vehicles certified to CMVSS No. 114 must be equipped with an 
immobilizer meeting one of these four sets of requirements. Used motor 
vehicles imported into Canada must also be equipped with immobilizers 
meeting CMVSS No. 114. This requirement makes it more difficult to 
import into Canada motor vehicles manufactured in the U.S. that are not 
equipped with an immobilizer meeting CMVSS No. 114. In such cases, an 
immobilizer that complies with CMVSS No. 114, usually an aftermarket 
device, must be added to the vehicle before it can be imported into 
Canada.
    CAN/ULC-S338-98 contains design specifications, activation and 
deactivation requirements, durability tests, and tests to assess the 
resistance to physical attack for immobilizers. ECE R97 and ECE R116 
contain design specifications, activation and deactivation 
requirements, durability tests, and tests to assess the resistance to 
physical attack for immobilizers similar to those contained in CAN/ULC-
S338-98. The fourth set of requirements for immobilizers in CMVSS No. 
114 contains design specifications, activation and deactivation 
requirements, and requirements testing the ability of the immobilizer 
to resist deactivation by physical attack derived from the other 
standards. The fourth set of requirements, however, does not include 
the environmental tests and durability requirements that are included 
in CAN/ULC-S338-98, ECE R97 and ECE R116.
    In adopting the fourth set of performance requirements for 
immobilizers contained in CMVSS No. 114, Transport Canada stated that 
some of the environmental and durability requirements for immobilizers 
contained in CAN/ULC-S338-98, ECE R97, and ECE R116 were developed for 
aftermarket immobilizers and should not be applied to immobilizers that 
are installed as original equipment on a vehicle.\15\ Transport Canada 
also stated that those three standards contained requirements specific 
to particular immobilizer designs, had the potential to restrict the 
design of immobilizers, and had the potential to prevent the 
introduction of new and emerging technologies such as keyless vehicle 
technologies, key-replacement technologies and remote starting systems. 
Transport Canada stated that for these reasons it established a set of

[[Page 66836]]

performance requirements without the environmental and durability 
requirements contained in CAN/ULC-S338-98, ECE R97, and ECE R116.
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    \15\ See SOR/2007-246 November, 2007 ``Regulations Amending the 
Motor Vehicle Safety Regulations (Theft Protection and Rollaway 
Prevention--Standard 114)'' 2007-11-14 Canada Gazette Part II, Vol. 
141, No. 23.
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III. Proposed Rule

    The agency proposed to include performance criteria for 
immobilizers in part 543 so that manufacturers may more easily apply 
for exemptions from the parts marking requirements for vehicles lines 
with immobilizers conforming to CMVSS No. 114. NHTSA proposed to add 
performance criteria to part 543 to make our theft prevention standards 
more in line with those of Canada. In order to be eligible for an 
exemption under the proposal, manufacturers would be required to state 
and demonstrate that the immobilizer device they are installing in the 
vehicle line meets the proposed performance criteria and is durable and 
reliable.
    The agency believes that adding performance criteria from CMVSS No. 
114 to part 543 is the simplest way to make our anti-theft regulations 
more in line with that standard and to reduce the burden to 
manufacturers, who are already installing immobilizers in compliance 
with that standard, of applying for an exemption from the parts marking 
requirements. The agency could not add performance requirements for 
immobilizers as part of Federal Motor Vehicle Safety Standard (FMVSS) 
No. 114, Theft Protection and Rollaway Prevention, since doing so would 
require a determination that the additional requirements would be 
consistent with the National Traffic and Motor Vehicle Safety Act 
(Motor Vehicle Safety Act).\16\ Further, the agency is unable to issue 
a theft prevention standard under the Theft Act to require the 
installation of immobilizers because that Act limits the agency's 
standard setting authority to issuing standards that require parts 
marking.\17\ Manufacturers are allowed to install immobilizers in lieu 
of parts marking, but under an exemption from the theft standard, not 
as a compliance alternative included in the theft standard.
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    \16\ 49 U.S.C. 30101 et seq.
    \17\ See 49 U.S.C. 33101(11) (defining ``vehicle theft 
prevention standard'' as a performance standard for identifying 
major vehicle parts by affixing numbers or symbols to those parts).
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    Prior to this final rule, NHTSA had not formally or informally 
adopted any technical performance criteria for anti-theft devices. 
While NHTSA has granted many petitions for exemption from the parts 
marking requirements for vehicle lines equipped with an immobilizer 
anti-theft device, a manufacturer is not required to install an 
immobilizer in order to gain an exemption. The agency proposed to 
retain the current exemption process so that manufacturers would still 
be able to gain an exemption for installing anti-theft devices that do 
not conform to the proposed performance criteria for immobilizers. The 
number of exemptions available to manufacturers would not increase as a 
result of the proposal. Thus, manufacturers will continue to be 
eligible for an exemption from the parts marking requirements for only 
one vehicle line per model year.
    NHTSA proposed only the fourth set of performance criteria for 
immobilizers contained in CMVSS No. 114 for inclusion in part 543. The 
agency proposed to adopt only this one set of performance criteria 
because of the factors articulated by Transport Canada discussed in 
Section C above. Furthermore, the agency proposed adopting only this 
one set of performance criteria as the simplest way to harmonize anti-
theft regulations between the U.S. and Canada. In the proposed rule, 
NHTSA anticipated the possibility that vehicles equipped with 
immobilizers meeting the performance criteria in CAN/ULC-S338-98, ECE 
R97, or ECE R116 would still be able to obtain an exemption from the 
theft prevention standard via a petition filed under the current 
exemption procedures. The agency sought comment on whether it should 
consider including all four performance criteria.
    In its proposal, NHTSA tentatively concluded that immobilizers 
meeting the proposed performance criteria are likely to be as effective 
in reducing and deterring motor vehicle theft as compliance with the 
parts marking requirements in part 541. The agency has granted numerous 
exemptions from the theft prevention standard for vehicle lines 
equipped with immobilizers based on data submitted by manufacturers 
indicating that immobilizers were as effective in reducing and 
deterring motor vehicle theft as compliance with that standard. Several 
studies have also indicated that immobilizers designed to meet 
technical performance criteria are effective in reducing and deterring 
motor vehicle theft. Studies in Australia and Canada on the 
effectiveness of immobilization systems (which meet CAN/ULC-S338-98 or 
ECE R97 and ECE R116) have shown reduced incidence of theft compared to 
vehicles that were not equipped with immobilizers.\18\
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    \18\ See Principles for Compulsory Immobilizer Schemes, prepared 
for the National Motor Vehicle Theft Reduction Council by MM Starrs 
Pty Ltd., ISBN 1 876704 17 9, Melbourne, Australia, October 2002; 
Matthew J Miceli ``A Report on Fatalities and Injuries as a Result 
of Stolen Motor Vehicles (1999-2001),'' prepared for The National 
Committee to Reduce Auto Theft Project #6116 and Transport Canada, 
December 10, 2002.
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    For these reasons, the agency concluded that establishing 
performance criteria for immobilizers as a means of getting an 
exemption from the theft prevention standard is consistent with 49 
U.S.C. 33106 of the Theft Act. That section requires the agency to 
determine that an anti-theft device is likely to be as effective in 
reducing and deterring motor vehicle theft as compliance with the parts 
marking requirements in part 541 in order to grant an exemption from 
those requirements.
    The proposed performance criteria for immobilizers included 
specifications for when the immobilizer should arm after the disarming 
device is removed from the vehicle. The performance criteria state 
that, when armed, the immobilizer should prevent the vehicle from 
moving more than three meters under its own power by inhibiting the 
operation of at least one of the vehicle's electronic control units 
(ECU). Further, the performance criteria state that, when armed, the 
immobilizer should not disable the vehicle's brake system. During the 
disarming process, the immobilizer should send a code to the inhibited 
ECU to allow the vehicle to move under its own power. The immobilizer 
should be configured so that disrupting the device's normal operating 
voltage cannot disarm the immobilizer. Additionally, the immobilizer 
must have a minimum capacity for 50,000 code variants and shall not be 
capable of processing more than 5,000 codes within 24 hours unless the 
immobilizer uses rolling or encrypted codes. The performance criteria 
state that it shall not be possible to replace the immobilizer without 
the use of software. In order to satisfy the performance criteria, the 
immobilizer in a vehicle must be designed so that it is not possible to 
disarm it using common tools within five minutes.
    In order to promote understanding of the new terms used in the 
regulatory text, the agency also proposed definitions for 
``immobilizer'' and ``accessory mode.''
    The agency plans on ensuring that immobilizer devices that 
manufacturers are installing to obtain an exemption conform with the 
proposed performance criteria by requiring manufacturers to state that 
they have certified the immobilizer installed on the vehicle to the 
performance criteria of CMVSS No. 114. Manufacturers must be ready to

[[Page 66837]]

provide Transport Canada with evidence that the immobilizer complies 
with CMVSS No. 114, along with all other applicable Canadian Standards, 
prior to certifying the vehicle under the Canadian Motor Vehicle Safety 
Act.\19\ NHTSA believes that it can rely on the information that 
manufacturers have kept to provide to Transport Canada regarding their 
certification to CMVSS No. 114 to ensure that immobilizers 
manufacturers install in order to obtain an exemption conform to the 
proposed performance criteria. The NPRM proposed that manufacturers 
submit the documentation provided to Transport Canada regarding their 
certification to CMVSS No. 114 to NHTSA as part of a manufacturer's 
petition for exemption. We do not believe that requiring this 
information as part of the petition would place a burden on 
manufacturers because they are already compiling this information to 
provide to Transport Canada, if requested, when certifying their 
vehicles under the Canadian Motor Vehicle Safety Act.
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    \19\ Motor Vehicle Safety Act. R.S.C., ch. 16 section 5(1)(e) 
(1993) (Can.). The Canadian Motor Vehicle Safety Act requires a 
manufacturer to certify that its vehicles comply with all applicable 
Canadian Motor Vehicle Safety Standards before the vehicles can be 
sold in Canada.
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    The proposed regulatory text did not include a requirement that 
manufacturers provide a detailed description of the immobilizer device 
as part of the petition because we believe that the documentation that 
manufacturers are keeping to provide to Transport Canada, and that they 
would be required to provide to NHTSA, describes the immobilizer device 
in sufficient detail for the agency to be able to determine whether the 
device satisfies the performance criteria.
    The proposed performance criteria did not include specifications 
that address the durability and reliability of immobilizers because the 
agency was concerned about the limitations such specifications could 
pose to immobilizer designs. Part 543 currently requires manufacturers 
to explain how the design of their immobilizer device ensures that it 
is durable and reliable in order to be eligible for an exemption.\20\ 
Because the agency believes that it is possible for the durability and 
reliability of an immobilizer to impact its effectiveness, we 
tentatively decided to retain this criterion of eligibility as part of 
the proposed performance criteria. We tentatively concluded that 
requiring manufacturers to submit a statement regarding the durability 
and reliability of the immobilizer is the best way to ensure that 
immobilizers are durable and reliable without impacting the ability of 
manufacturers to create new immobilizer systems. We believe 
manufacturers will submit statements similar to the ones they are 
currently submitting as part of their exemption applications to 
demonstrate that their immobilizers are durable and reliable.
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    \20\ 49 CFR 543.6(a)(3)(v).
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    The agency stated it believes the proposed performance criteria are 
consistent with the following anti-theft device attributes that are 
currently contained in part 543:
     The specification in the proposed performance criteria 
that the immobilizer arm after the disarming device is removed from the 
vehicle will facilitate activation of the immobilizer by the driver and 
prevent unauthorized persons who have entered the vehicle by means 
other than a key from operating the vehicle.\21\
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    \21\ See 49 CFR 543.6(a)(3)(i), (iv) (stating that the 
application for exemption must include an explanation of how the 
anti-theft device facilitates activation by the driver and prevents 
unauthorized persons who have entered the vehicle by means other 
than a key from operating the vehicle).
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     The specification in the proposed performance criteria 
that the immobilizer have certain code processing capabilities and be 
resistant to physical attack will ensure that the immobilizer is 
designed to prevent defeat or circumvention by persons entering the 
vehicle by means other than a key.\22\
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    \22\ See 49 CFR 543.6(a)(3)(iii)(iv) (stating that the 
application for exemption must include an explanation of how the 
anti-theft device prevents defeat or circumvention of the device by 
an someone without the vehicle's key and prevents unauthorized 
persons who have entered the vehicle by means other than a key from 
operating the vehicle).
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    The proposed performance criteria correspond to the aspects of 
performance of immobilizer devices that manufacturers now qualitatively 
describe in their exemption petitions. Manufacturers are currently 
demonstrating the effectiveness of immobilizers by describing the 
testing the immobilizer has been subjected to, how the immobilizer is 
activated, how the immobilizer interacts with the key to allow the 
vehicle to start and the encryption of electronic communications 
between the key and the immobilizer. These characteristics correspond 
to performance criteria in the proposal for how the immobilizer must 
arm, preventing the vehicle from moving under its own power, how the 
immobilizer must disarm to allow the driver to start the vehicle, the 
minimum number of code variants that the immobilizer is able to 
process, and the immobilizer's resistance to manipulation and physical 
attack. The proposed performance criteria simplify the process for 
applying for an exemption because manufacturers would no longer need to 
describe how the immobilizer achieves these aspects of performance. 
Instead, manufacturers would only need to state and demonstrate that 
their immobilizer device conforms to the performance criteria, and is 
durable and reliable.
    In order to allow manufacturers to more easily apply for an 
exemption from the theft prevention standard and to reduce the burden 
to the agency in processing exemption petitions we tentatively decided 
that we will notify manufacturers of decisions to grant or deny 
exemption petitions by notifying them of the agency's decision in 
writing. As proposed, we would not publish notices of our decisions to 
grant or deny exemption petitions from the theft prevention standard 
based on the manufacturer having satisfied the performance criteria in 
the Federal Register. NHTSA would continue to inform the public and law 
enforcement that a particular vehicle line has an exemption based on 
satisfaction of the performance criteria by updating the list of exempt 
vehicle lines in appendix A-I to part 541.

IV. Overview of Comments

    NHTSA received two comments on the proposed rule. Commenters were 
generally supportive of the proposal because it allows for improved 
harmonization with Canada, but expressed concerns about the 
documentation required to obtain an exemption and allowing for more 
compliance options similar to Transport Canada's CMVSS No. 114.
    The Alliance of Automobile Manufacturers (Alliance) expressed a 
procedural concern with the information manufacturers must provide to 
NHTSA in order to obtain an exemption under the proposed regulation. 
Specifically, the Alliance noted that in order to comply with Canadian 
law, manufacturers must certify as complying with all applicable 
CMVSSs--but manufacturers do not routinely provide compliance data to 
Transport Canada to prove compliance. Because of this, the Alliance 
suggested that manufacturers only be required to submit a statement 
that the immobilizer meets the performance requirements noted in the 
proposal. The Alliance suggested that this statement would eliminate 
the proposal's requirement to submit the same documentation that 
demonstrates compliance with CMVSS No. 114.
    Toyota Motor North America, Inc. (Toyota) submitted a comment 
stating

[[Page 66838]]

that it agrees with the comments submitted by the Alliance and that it 
believes immobilizers conforming to any of the four enumerated 
standards in CMVSS No. 114 should be acceptable to obtain an exemption 
under part 543. Toyota suggests that allowing manufacturers to obtain 
an exemption by complying with any of the four accepted standards would 
allow for greater harmonization between the United States and Canada, 
as well as increase manufacturer flexibility.

V. Response to Comments and Differences Between the Final Rule and NPRM

A. Manufacturers Seeking an Exemption Via Compliance With Performance 
Criteria Will Be Required To Submit Data Demonstrating Compliance With 
Standards

    Transport Canada has a certification process that is similar to 
NHTSA's ``self-certification process.'' Under Canada's Motor Vehicle 
Safety Act, the responsibility rests with the vehicle manufacturer or 
importer to certify that all new vehicles offered for sale in Canada 
comply with all applicable safety standards in effect on the date of 
manufacture. Manufacturers or importers certify this by displaying the 
national safety mark. As a prerequisite to obtaining permission to use 
the national safety mark, a manufacturer must maintain records 
demonstrating completion of certification testing. While certification 
test documentation may not be requested by Transport Canada for every 
new or imported vehicle in Canada, the Canadian Motor Vehicle Safety 
Act requires such records be available should Transport Canada request 
them.
    NHTSA believes that providing only a statement of compliance with 
CMVSS No. 114 is insufficient to justify an exemption from the theft 
prevention standard. Moreover, the data NHTSA will require is data 
manufacturers should be keeping in order to facilitate any compliance 
verification requests from Transport Canada.
    The agency currently receives petitions for exemptions from 
manufacturers that present justification for receiving an exemption. 
This application includes an explanation of how the anti-theft device 
will promote activation, attract attention to the efforts of 
unauthorized persons to enter or operate a vehicle by means other than 
a key, prevent defeat or circumvention of the device by unauthorized 
persons, prevent operation of the vehicle by unauthorized persons to 
enter or operate a vehicle by unauthorized entrants, and ensure the 
reliability and durability of the device. On those grounds, the agency 
can evaluate the justification and grant or deny the exemption. This 
rule seeks to streamline the exemption process by using compliance with 
certain standards in lieu of submitting separate justifications for 
exemptions under Part 543. Requiring manufacturers to provide the 
recordkeeping information required by the Transport Canada to 
demonstrate CMVSS No. 114 compliance, should Transport Canada ask for 
the data, allows NHTSA to ensure anti-theft devices installed on 
vehicles meet the same level of performance as would be expected of an 
anti-theft device requested through the prior exemption process. 
Therefore, the agency is finalizing the proposed requirement that 
manufacturers submit compliance data kept for Transport Canada 
compliance in order to prove compliance with CMVSS No. 114 standards.

B. Manufacturers Seeking an Exemption Via Compliance With Performance 
Criteria May Comply With Any of the Four Criteria in CMVSS No. 114

    We sought comments on whether adding the standards in CAN/ULC-S338-
98,\23\ ECE R97, and ECE R116 to the agency's accepted performance 
criteria would better accomplish the agency's goal of harmonizing the 
process for obtaining an exemption with the Canadian theft prevention 
standard. After reconsideration of the proposal and reviewing public 
comments, NHTSA has decided to accept anti-theft devices compliant with 
any of the four performance criteria allowed under CMVSS No. 114 for 
exemptions under part 543. Manufacturers will be required to submit 
statements similar to the ones they are currently submitting as part of 
their exemption applications to demonstrate that immobilizers certified 
to any of the four standards are durable and reliable. The agency 
proposed what it believed to be the simplest method of harmonization 
with Canada; however, after evaluating stakeholder response to this 
issue, we believe that finalizing all four performance criteria will 
simplify compliance and promote harmonization between the United States 
and Canada.
---------------------------------------------------------------------------

    \23\ NHTSA was notified that ULC posted a withdrawal for CAN/
ULC-S338-98 on December 22, 2015. The comment period for this 
withdrawal closed on January 20, 2016. See: https://www.scc.ca/en/standards/work-programs/ulc/standard-for-automobile-theft-deterrent-equipment-and-systems-electronic-immobilization (last accessed 
February 10, 2016).
---------------------------------------------------------------------------

    We proposed Transport Canada's fourth performance criteria because 
Transport Canada determined that the three other standards were 
developed for aftermarket immobilizers and had the potential to 
restrict the design of immobilizers. Finalizing all four performance 
criteria will provide additional flexibility by allowing OEMs and 
aftermarket manufacturers to elect the performance criteria most 
appropriate for their device. It will also improve harmonization with 
the United Nations Economic Commission for Europe (ECE) immobilizer 
performance criteria by allowing manufacturers the option of complying 
with one of two ECE standards and receiving an exemption from the theft 
prevention standard.
    Further, NHTSA believes allowing all four performance standards 
will be as effective in reducing and deterring motor vehicle theft as 
compliance with the parts marking requirements in part 541. Since 2007, 
when Transport Canada began requiring OEMs to install immobilizers 
meeting one of the four performance criteria for most vehicles, theft 
in Canada has decreased more than 50 percent.\24\ As discussed in the 
proposal, the agency believes that based on the effectiveness of 
immobilizers certified to any of the performance criteria in Canada, 
the regulations finalized today are consistent with the Theft Act.
---------------------------------------------------------------------------

    \24\ See ``actual incidents'' of ``total theft of motor 
vehicle'' at http://www5.statcan.gc.ca/cansim/a01?lang=eng (last 
accessed February 10, 2016).
---------------------------------------------------------------------------

    The agency has modified the regulatory text to reflect the 
inclusion of all four performance criteria. As a result of doing so, 
NHTSA has moved the originally proposed criteria from C.R.C, c. 
1038.114, Theft Protection and Rollaway Prevention (in effect March 30, 
2011) to appendix A of part 543.

VI. Costs, Benefits, and Compliance Date

    This rule amends part 543 to add performance criteria for 
immobilizers that are contained in CMVSS No. 114. Because the agency is 
retaining the current exemption process as a means of gaining an 
exemption from the theft prevention standard, the addition of 
performance criteria to part 543 would result in no costs to 
manufacturers. Manufacturers would not be required to make any changes 
to products in order to retain eligibility for an exemption.
    The agency cannot quantify the benefits of this rulemaking. The 
agency does, however, expect some benefits to accrue from making the 
exemption process in part 543 more closely harmonized with CMVSS No. 
114. Additionally, since two of the accepted performance criteria added 
by this rule

[[Page 66839]]

are ECE standards, manufacturers could potentially pay less for 
immobilizer devices if they are able to order higher volumes of parts 
due to harmonization with Canadian and ECE standards.
    Adding the performance criteria would allow manufacturers that are 
installing immobilizers as standard equipment for a line of motor 
vehicles in compliance with CMVSS No. 114 to more easily gain an 
exemption from the parts marking requirements. The agency believes this 
would reduce the cost to manufacturers of applying for an exemption 
from the parts marking requirements. Adding performance criteria to 
part 543 would also result in a reduction in vehicle theft in cases for 
which the rule improves the effectiveness of the anti-theft devices 
chosen by manufacturers.
    If the rule encourages more manufacturers to install immobilizers 
meeting CMVSS No. 114 on vehicles sold in the United States, it could 
result in cost savings to consumers seeking to import used vehicles 
into Canada. Importing used vehicles that already comply with CMVSS No. 
114 into Canada saves consumers from having to pay to have an 
aftermarket immobilizer installed in the vehicle.
    The compliance date will be 60 days after the date of issuance of 
the publication of this final rule.

VIII. Regulatory Notices and Analyses

Executive Order 12866, Executive Order 13563, and DOT Regulatory 
Policies and Procedures

    NHTSA has considered the impact of this rulemaking action under 
Executive Order 12866, Executive Order 13563, and the Department of 
Transportation's regulatory policies and procedures. This rulemaking 
document was not reviewed by the Office of Management and Budget under 
E.O. 12866, ``Regulatory Planning and Review.'' It is not considered to 
be significant under E.O. 12866 or the Department's regulatory policies 
and procedures.
    This rule would amend part 543 to add performance criteria for 
immobilizers that are contained in CMVSS No. 114 to allow manufacturers 
who are installing immobilizers in compliance with that standard to 
more easily obtain an exemption from the theft prevention standard.
    The agency concludes that the impacts of the changes would be so 
minimal that preparation of a full regulatory evaluation is not 
required. This rule would not result in any costs to manufacturers 
because the current exemption process would be left in place. 
Manufacturers would not be required to make any changes to current 
vehicles to retain eligibility for an exemption. It is also possible 
that this rule would result in a reduction in motor vehicle thefts if 
immobilizers meeting the performance criteria are more effective than 
current designs.

Executive Order 13609: Promoting International Regulatory Cooperation

    The policy statement in section 1 of Executive Order 13609 
provides, in part:

    The regulatory approaches taken by foreign governments may 
differ from those taken by U.S. regulatory agencies to address 
similar issues. In some cases, the differences between the 
regulatory approaches of U.S. agencies and those of their foreign 
counterparts might not be necessary and might impair the ability of 
American businesses to export and compete internationally. In 
meeting shared challenges involving health, safety, labor, security, 
environmental, and other issues, international regulatory 
cooperation can identify approaches that are at least as protective 
as those that are or would be adopted in the absence of such 
cooperation. International regulatory cooperation can also reduce, 
eliminate, or prevent unnecessary differences in regulatory 
requirements.

    NHTSA is issuing this rule pursuant to a regulatory cooperation 
agreement between the United States and Canada. This rule would more 
closely harmonize vehicle theft regulations in the United States with 
those in Canada.

National Environmental Policy Act

    We have reviewed this rule for the purposes of the National 
Environmental Policy Act and determined that it would not have a 
significant impact on the quality of the human environment.

Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA) of 1996), whenever an agency is required to publish a notice 
of rulemaking for any proposed or final rule, it must prepare and make 
available for public comment a regulatory flexibility analysis that 
describes the effect of the rule on small entities (i.e., small 
businesses, small organizations, and small governmental jurisdictions). 
The Small Business Administration's regulations at 13 CFR part 121 
define a small business, in part, as a business entity ``which operates 
primarily within the United States.'' 13 CFR 121.105(a). No regulatory 
flexibility analysis is required if the head of an agency certifies the 
rule will not have a significant economic impact on a substantial 
number of small entities.
    NHTSA has considered the effects of the rule under the Regulatory 
Flexibility Act and certifies that this rule would not have a 
significant economic impact on a substantial number of small entities. 
This rule amends part 543 to add performance criteria for immobilizers 
that are contained in CMVSS No. 114 to allow manufacturers who are 
installing immobilizers in compliance with that standard to more easily 
obtain an exemption from the theft prevention standard. This rule would 
not significantly affect any entities because it would leave in place 
the current exemption process so that manufacturers would not need to 
make any changes to products to retain eligibility for an exemption. 
Accordingly, we do not anticipate that this rule would have a 
significant economic impact on a substantial number of small entities.

Executive Order 12988 (Civil Justice Reform)

    With respect to the review of the promulgation of a new regulation, 
section 3(b) of Executive Order 12988, ``Civil Justice Reform'' (61 FR 
4729; Feb. 7, 1996), requires that Executive agencies make every 
reasonable effort to ensure that the regulation: (1) Clearly specifies 
the preemptive effect; (2) clearly specifies the effect on existing 
Federal law or regulation; (3) provides a clear legal standard for 
affected conduct, while promoting simplification and burden reduction; 
(4) clearly specifies the retroactive effect, if any; (5) specifies 
whether administrative proceedings are to be required before parties 
file suit in court; (6) adequately defines key terms; and (7) addresses 
other important issues affecting clarity and general draftsmanship 
under any guidelines issued by the Attorney General. This document is 
consistent with that requirement.
    Pursuant to this Order, NHTSA notes as follows. There is no 
requirement that individuals submit a petition for reconsideration or 
pursue other administrative proceedings before they may file suit in 
court. NHTSA has considered whether this rulemaking would have any 
retroactive effect. This rule does not have any retroactive effect.

Unfunded Mandates Reform Act

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires Federal agencies to prepare a written assessment of the costs, 
benefits, and other effects of a proposed or final rule that includes a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of

[[Page 66840]]

more than $100 million in any one year (adjusted for inflation with 
base year of 1995).
    Before promulgating a rule for which a written statement is needed, 
section 205 of the UMRA generally requires NHTSA to identify and 
consider a reasonable number of regulatory alternatives and adopt the 
least costly, most cost-effective, or least burdensome alternative that 
achieves the objectives of the rule. The provisions of section 205 do 
not apply when they are inconsistent with applicable law. Moreover, 
section 205 allows NHTSA to adopt an alternative other than the least 
costly, most cost-effective, or least burdensome alternative if the 
agency publishes with the final rule an explanation why that 
alternative was not adopted.
    This rule is not anticipated to result in the expenditure by state, 
local, or tribal governments, in the aggregate, or by the private 
sector in excess of $100 million annually. The cost impact of this rule 
is expected to be $0. Therefore, the agency has not prepared an 
economic assessment pursuant to the Unfunded Mandate Reform Act.

Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501, et 
seq.), Federal agencies must obtain approval from the Office of 
Management and Budget (OMB) for each collection of information they 
conduct, sponsor, or require through regulations. This rule would 
decrease the materials that a manufacturer would need to submit to the 
agency to obtain an exemption from the vehicle theft prevention 
standard in certain instances.
    Agency: National Highway Traffic Safety Administration (NHTSA).
    Title: 49 CFR part 543, Petitions for Exemption from the Vehicle 
Theft Prevention Standard.
    Type of Request: Revision of a currently approved collection.
    OMB Control Number: 2127-0542.
    Form Number: The collection of this information uses no standard 
form.
    Requested Expiration Date of Approval: Three years from the date of 
approval.
    Summary of the Collection of Information: This collection consists 
of information that motor vehicle manufacturers must submit in support 
of an application for an exemption from the vehicle theft prevention 
standard. Manufacturers wishing to apply for an exemption from the 
parts marking requirement because they have installed immobilizers 
meeting the performance criteria would be required to submit a 
statement that the entire line of vehicles is equipped with an 
immobilizer, as standard equipment, that meets the performance criteria 
contained in that section, a statement that the immobilizer has been 
certified to the Canadian theft prevention standard, documentation 
provided to Transport Canada to demonstrate that the immobilizer was 
certified to the Canadian theft prevention standard, and a statement 
that the immobilizer device is durable and reliable. This rule would 
not change the information that manufacturers would need to submit if 
seeking an exemption in accordance with the current process used for 
petitions seeking an exemption based on the installation of 
immobilizers.
    Description of the Need for the Information and Use of the 
Information: The information is needed to determine whether a vehicle 
line is eligible for an exemption from the vehicle theft prevention 
standard.
    Description of the Likely Respondents (Including Estimated Number, 
and Frequency of Response to the Collection of Information): Currently, 
nineteen manufacturers have one or more car lines exempted. We expect 
that within the three year period covered by this clearance, twelve 
manufacturers would apply for an exemption per year: Nine under the 
current process and three under the performance criteria. Based on 
another analysis of the exemption information NHTSA has received, as 
well as the comments the agency received, NHTSA has made a minor 
adjustment to the estimates provided in the NPRM. In comparison to the 
estimates provided in the NPRM, the agency believes that one more 
manufacturer will use the new process within the next three years. The 
agency thinks it is likely that more manufacturers will migrate to the 
new process over time, however, because many manufacturers have product 
plans covering the next three years that might not happen until the 
agency renews its collection in three years. NHTSA anticipates 
reevaluating this assessment during its next renewal of this 
collection.
    Estimate of the Total Annual Reporting and Recordkeeping Burden 
Resulting from the Collection of Information: We estimate that the 
burden for applying for an exemption under this rule would be 2300 
hours. The burden for applying for an exemption under the current 
process is estimated to be 226 hours x 9 respondents = 2034 hours. The 
burden for apply for an exemption under the performance criteria is 
estimated to be 20 hours x 3 respondents = 60 hours.

National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act (NTTAA) requires NHTSA to evaluate and use existing voluntary 
consensus standards in its regulatory activities unless doing so would 
be inconsistent with applicable law (e.g., the statutory provisions 
regarding NHTSA's vehicle safety authority) or otherwise impractical.
    Voluntary consensus standards are technical standards developed or 
adopted by voluntary consensus standards bodies. Technical standards 
are defined by the NTTAA as ``performance-based or design-specific 
technical specification and related management systems practices.'' 
They pertain to ``products and processes, such as size, strength, or 
technical performance of a product, process or material.''
    Examples of organizations generally regarded as voluntary consensus 
standards bodies include the American Society for Testing and Materials 
(ASTM), the Society of Automotive Engineers (SAE), and the American 
National Standards Institute (ANSI). If NHTSA does not use available 
and potentially applicable voluntary consensus standards, we are 
required by the Act to provide Congress, through OMB, an explanation of 
the reasons for not using such standards.
    We are not aware of any technical performance criteria for 
immobilizers issued by voluntary consensus standards bodies in the 
United States. For the reasons discussed in this notice, the agency has 
determined that the simplest way to harmonize part 543 with Canadian 
theft prevention regulations was to adopt all four performance criteria 
discussed above.

Executive Order 13211

    Executive Order 13211 \25\ applies to any rule that: (1) Is 
determined to be economically significant as defined under E.O. 12866, 
and is likely to have a significant adverse effect on the supply, 
distribution, or use of energy; or (2) that is designated by the 
Administrator of the Office of Information and Regulatory Affairs as a 
significant energy action. If the regulatory action meets either 
criterion, we must evaluate the adverse energy effects of the rule and 
explain why the regulation is preferable to other potentially effective 
and reasonably feasible alternatives considered by NHTSA.
---------------------------------------------------------------------------

    \25\ 66 FR 28355 (May 18, 2001).

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

[[Page 66841]]

    This rule amends part 543 to add performance criteria for 
immobilizers that are contained in CMVSS No. 114 to allow manufacturers 
who are installing immobilizers in compliance with that standard to 
more easily obtain an exemption from the theft prevention standard. 
Therefore, this rule would not have any significant adverse energy 
effects. Accordingly, this rulemaking action is not designated as a 
significant energy action.

Regulation Identifier Number (RIN)

    The Department of Transportation assigns a regulation identifier 
number (RIN) to each regulatory action listed in the Unified Agenda of 
Federal Regulations. The Regulatory Information Service Center 
publishes the Unified Agenda in April and October of each year. You may 
use the RIN contained in the heading at the beginning of this document 
to find this action in the Unified Agenda.

List of Subjects in 49 CFR Part 543

    Imports, Motor vehicle safety, Motor vehicles, Reporting and 
recordkeeping requirements, Tires.

    In consideration of the foregoing, NHTSA amends 49 CFR chapter V as 
follows.

PART 543--EXEMPTION FROM VEHICLE THEFT PREVENTION STANDARD

0
1. The authority citation for part 543 of title 49 is revised to read 
as follows:

    Authority:  49 U.S.C. 322, 33101, 33102, 33103, 33104 and 33105; 
delegation of authority at 49 CFR 1.95.


0
2. Amend Sec.  543.4 by adding, in alphabetical order, definitions for 
``Accessory mode'' and ``Immobilizer'' in paragraph (b) to read as 
follows:


Sec.  543.4  Definitions.

* * * * *
    (b) * * *
    Accessory mode means the ignition switch setting in which certain 
electrical systems (such as the radio and power windows) can be 
operated without the operation of the vehicle's propulsion engine.
    Immobilizer means a device that, when activated, is intended to 
prevent a motor vehicle from being powered by its own propulsion 
system.
* * * * *

0
3. In Sec.  543.5, revise paragraphs (b)(2), (6), and (7) and add 
paragraphs (b)(8) and (9) to read as follows:


Sec.  543.5  Petition: General requirements.

* * * * *
    (b) * * *
    (2) Be submitted in three copies to: Administrator, National 
Highway Traffic Safety Administration, 1200 New Jersey Avenue, SE., 
Washington, DC 20590.
* * * * *
    (6) Identify whether the exemption is sought under Sec.  543.6 or 
Sec.  543.7.
    (7) If the exemption is sought under Sec.  543.6, set forth in full 
the data, views, and arguments of the petitioner supporting the 
exemption, including the information specified in that section.
    (8) If the exemption is sought under Sec.  543.7, submission of the 
information required in that section.
    (9) Specify and segregate any part of the information or data 
submitted that the petitioner requests be withheld from public 
disclosure in accordance with part 512, Confidential Business 
Information, of this chapter.


Sec. Sec.  543.7 through 543.9   [Redesignated as Sec. Sec.  543.8 
through 543.10]

0
 4. Redesignate Sec. Sec.  543.7 through 543.9 as Sec. Sec.  543.8 
through 543.10.

0
 5. Add a new Sec.  543.7 to read as follows:


Sec.  543.7  Petitions based on performance criteria.

    A petition submitted under this section must include:
    (a) A statement that the entire line of vehicles is equipped with 
an immobilizer, as standard equipment, that meets one of the following:
    (1) The performance criteria (subsections 8 through 21) of C.R.C, 
c. 1038.114, Theft Protection and Rollaway Prevention (in effect March 
30, 2011), as excerpted in appendix A of this part;
    (2) National Standard of Canada CAN/ULC-S338-98, Automobile Theft 
Deterrent Equipment and Systems: Electronic Immobilization (May 1998);
    (3) United Nations Economic Commission for Europe (UN/ECE) 
Regulation No. 97 (ECE R97), Uniform Provisions Concerning Approval of 
Vehicle Alarm System (VAS) and Motor Vehicles with Regard to Their 
Alarm System (AS) in effect August 8, 2007; or
    (4) UN/ECE Regulation No. 116 (ECE R116), Uniform Technical 
Prescriptions Concerning the Protection of Motor Vehicles Against 
Unauthorized Use in effect on February 10, 2009.
    (b) Compliance documentation kept to demonstrate the basis for 
certification with the performance criteria specified in paragraph (a) 
of this section.
    (c) A statement that the immobilizer device is durable and 
reliable.

0
6. Amend newly redesignated Sec.  543.8 by revising paragraph (f) and 
adding paragraph (g) to read as follows:


Sec.  543.8  Processing an exemption petition.

* * * * *
    (f) If the petition is sought under Sec.  543.6, NHTSA publishes a 
notice of its decision to grant or deny an exemption petition in the 
Federal Register and notifies the petitioner in writing of the agency's 
decision.
    (g) If the petition is sought under Sec.  543.7, NHTSA notifies the 
petitioner in writing of the agency's decision to grant or deny an 
exemption petition.

0
7. Newly redesignated Sec.  543.9 is revised to read as follows


Sec.  543.9  Duration of exemption.

    Each exemption under this part continues in effect unless it is 
modified or terminated under Sec.  543.10, or the manufacturer ceases 
production of the exempted line.

0
 8. Add appendix A to part 543 to read as follows:

Appendix A to Part 543--Performance Criteria (Subsections 8 Through 21) 
of C.R.C, c. 1038.114 (in Effect March 30, 2011)

    In order to be eligible for an exemption under Sec.  
543.7(a)(1), the entire vehicle line must be equipped with an 
immobilizer meeting the following criteria:
    (1) Subject to paragraph (2) of this appendix, an immobilization 
system shall arm automatically within a period of not more than 1 
minute after the disarming device is removed from the vehicle, if 
the vehicle remains in a mode of operation other than accessory mode 
or on throughout that period.
    (2) If the disarming device is a keypad or biometric identifier, 
the immobilization system shall arm automatically within a period of 
not more than 1 minute after the motors used for the vehicle's 
propulsion are turned off, if the vehicle remains in a mode of 
operation other than accessory mode or on throughout that period.
    (3) The immobilization system shall arm automatically not later 
than 2 minutes after the immobilization system is disarmed, unless:
    (i) Action is taken for starting one or more motors used for the 
vehicle's propulsion;
    (ii) Disarming requires an action to be taken on the engine 
start control or electric motor start control, the engine stop 
control or electric motor stop control, or the ignition switch; or
    (iii) Disarming occurs automatically by the presence of a 
disarming device and the device is inside the vehicle.
    (4) If armed, the immobilization system shall prevent the 
vehicle from moving more than 3 meters (9.8 feet) under its own 
power by inhibiting the operation of at least one electronic control 
unit and shall not have any impact on the vehicle's brake system 
except that it may prevent regenerative braking and the release of 
the parking brake.
    (5) During the disarming process, a code shall be sent to the 
inhibited electronic control unit in order to allow the vehicle to 
move under its own power.

[[Page 66842]]

    (6) It shall not be possible to disarm the immobilization system 
by interrupting its normal operating voltage.
    (7) When the normal starting procedure requires that the 
disarming device mechanically latch into a receptacle and the device 
is physically separate from the ignition switch key, one or more 
motors used for the vehicle's propulsion shall start only after the 
device is removed from that receptacle.
    (8)(i) The immobilization system shall have a minimum capacity 
of 50,000 code variants, shall not be disarmed by a code that can 
disarm all other immobilization systems of the same make and model; 
and
    (ii) subject to paragraph (9) of this appendix, it shall not 
have the capacity to process more than 5,000 codes within 24 hours.
    (9) If an immobilization system uses rolling or encrypted codes, 
it may conform to the following criteria instead of the criteria set 
out in paragraph (8)(ii) of this appendix:
    (i) The probability of obtaining the correct code within 24 
hours shall not exceed 4 per cent; and
    (ii) It shall not be possible to disarm the system by re-
transmitting in any sequence the previous 5 codes generated by the 
system.
    (10) The immobilization system shall be designed so that, when 
tested as installed in the vehicle neither the replacement of an 
original immobilization system component with a manufacturer's 
replacement component nor the addition of a manufacturer's component 
can be completed without the use of software; and it is not possible 
for the vehicle to move under its own power for at least 5 minutes 
after the beginning of the replacement or addition of a component 
referred to in this paragraph (1).
    (11) The immobilization system's conformity to paragraph (10) of 
this appendix shall be demonstrated by testing that is carried out 
without damaging the vehicle.
    (12) Paragraph (10)(i) of this appendix does not apply to the 
addition of a disarming device that requires the use of another 
disarming device that is validated by the immobilization system.
    (13) The immobilization system shall be designed so that it can 
neither be bypassed nor rendered ineffective in a manner that would 
allow a vehicle to move under its own power, or be disarmed, using 
one or more of the tools and equipment listed in paragraph (14) of 
this appendix;
    (i) Within a period of less than 5 minutes, when tested as 
installed in the vehicle; or
    (ii) Within a period of less than 2.5 minutes, when bench-tested 
outside the vehicle.
    (14) During a test referred to in paragraph (13) of this 
appendix, only the following tools or equipment may be used: 
Scissors, wire strippers, wire cutters and electrical wires, a 
hammer, a slide hammer, a chisel, a punch, a wrench, a screwdriver, 
pliers, steel rods and spikes, a hacksaw, a battery operated drill, 
a battery operated angle grinder; and a battery operated jigsaw.

    Note: C.R.C, c. 1038.114, Theft Protection and Rollaway 
Prevention (in effect March 30, 2011). See: SOR/2011-69 March, 2011 
``Regulations Amending the Motor Vehicle Safety Regulations (Theft 
Prevention and Rollaway Prevention--Standard 114)'' 2011-03-30 
Canada Gazette Part II, Vol 145, No. 7.


    Issued in Washington, DC, on September 8, 2016, under authority 
delegated in 49 CFR part 1.95.
Mark R. Rosekind,
Administrator.
[FR Doc. 2016-22061 Filed 9-28-16; 8:45 am]
 BILLING CODE 4910-59-P