[Federal Register Volume 84, Number 160 (Monday, August 19, 2019)]
[Proposed Rules]
[Pages 42831-42842]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-17710]


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

DEPARTMENT OF COMMERCE

Economic Development Administration

13 CFR Parts 302 and 315

[Docket No.: 170830844-9318-01]
RIN 0610-AA80


General Updates and Elimination of Certain TAAF and PWEDA 
Regulations

AGENCY: Economic Development Administration, U.S. Department of 
Commerce.

ACTION: Notice of proposed rulemaking, request for public comment.

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

SUMMARY: The Economic Development Administration (``EDA''), U.S. 
Department of Commerce (``DOC''), is publishing this notice of proposed 
rulemaking (``NPRM'') to request public comment on proposed updates to 
the agency's regulations implementing the Trade Adjustment Assistance 
for Firms (``TAAF'') provisions of the Trade Act of 1974, as amended 
(``Trade Act''), and the Public Works and Economic Development Act of 
1965, as amended (``PWEDA''). The proposed changes to the TAAF program 
regulations would clarify the process for import-impacted U.S. 
manufacturing, oil and natural production and service firms to obtain 
technical assistance--identified in the Trade Act as ``adjustment 
assistance''--through the TAAF program, reorganize the regulations to 
make them easier to read and understand, incorporate best practices, 
and bring the regulations into closer alignment with the program's 
statutory requirements. The result will be to ease the burden on firms 
seeking adjustment assistance through the TAAF program and make it 
easier for Trade Adjustment Assistance Centers (``TAACs'') to work with 
firms. EDA also proposes the elimination of certain TAAF and PWEDA 
regulations that are unnecessary or duplicative because they describe 
requirements already established in other regulations or award 
documentation.

DATES: Written comments on this NPRM must be submitted by September 18, 
2019.

ADDRESSES: Comments on this NPRM may be submitted through any of the 
following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments. All comments received 
are a part of the public record and will generally be posted for public 
viewing on www.regulations.gov without change. All personal identifying 
information (e.g., name, address, etc.), confidential business 
information, or otherwise sensitive information submitted voluntarily 
by the sender will be publicly accessible. EDA will accept anonymous 
comments (enter ``N/A'' in the required fields if you wish to remain 
anonymous).
     Email: [email protected]. Include ``Comments on EDA's 
regulations'' and Docket No. 170830844-9318-01 in the subject line of 
the message.
     Mail: Office of the Chief Counsel, Economic Development 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Suite 72023, Washington, DC 20230. Please indicate ``Comments on 
EDA's regulations'' and Docket No. 170830844-9318-01 on the envelope.

FOR FURTHER INFORMATION CONTACT: Ryan Servais, Attorney Advisor, Office 
of the Chief Counsel, Economic Development Administration, U.S. 
Department of Commerce, 1244 Speer Boulevard, Suite 431, Denver, CO 
80204; telephone: (303) 844-4403.

SUPPLEMENTARY INFORMATION:

Background

    Through strategic grant investments that foster job creation and 
attract private investment, EDA supports development in economically 
distressed areas of the United States to prepare these areas for growth 
and success in the worldwide economy.
    EDA is publishing this NPRM to request public comments on proposed 
updates to the agency's regulations implementing the TAAF program (Part 
I) and PWEDA (Part II). These changes would ease the burden on firms 
and grantees by eliminating unnecessary and duplicative regulations and 
clarify and reorganize the regulations to make them easier to 
understand.
    The proposed updates would also incorporate best practices. For 
example, EDA is proposing to build into the definition of 
``subsidiary'' language that would recognize independent subsidiaries 
as eligible to apply for assistance separately from the firm that has 
acquired them. This change is in response to a growing number of 
petitions by firms that have been acquired before or after filing a 
petition for assistance, while continuing to operate independently. In 
addition, EDA proposes to add a requirement that firms must begin 
implementation of their Adjustment Proposal within six months after the 
Proposal is approved by EDA. Firms that do not begin implementation 
within six months after approval must update, re-submit their 
Adjustment Proposal, and request re-approval before any Adjustment 
Assistance may be provided. EDA also proposes to incorporate changes 
that would enable firms to amend their Adjustment Proposals within two 
years of EDA approval and that would require firms to complete 
implementation of the Adjustment Proposals within five years of 
approval. Furthermore, the regulations would require firms that are 
transferred, sold, or otherwise acquired by another firm, during this 
five-year period, to notify EDA, which will make a determination 
regarding the continued eligibility of the petitioner firm. These are 
existing best practices and help to ensure that Adjustment Proposals 
reflect current conditions and are maximally effective.
    These proposed changes would also align the regulations more 
closely with statutory requirements. Specifically, EDA proposes to 
refer to imported articles or services that compete with and are 
substantially equivalent to the petitioning firm's as ``directly 
competitive or like,'' as written in the Trade Act, rather than simply 
``directly competitive.'' In addition, EDA proposes to clarify all 
references to ``days'' as ``calendar days,'' to reflect this usage in 
the Trade Act, a change that would also speed up the time within which 
EDA is required to make determinations regarding firm eligibility and 
assistance.
    Additionally, because this rule would remove certain regulations 
and will make it easier for firms and EDA grantees to comply with the 
requirements for the TAAF and EDA grant programs, it is considered a 
``deregulatory action'' pursuant to the April 5, 2017, OMB guidance 
memorandum implementing Executive Order 13771.

Part I: Updates to TAAF Program Regulations

Trade Act Background

    Authorized under Chapter 3 of title II of the Trade Act of 1974 (19 
U.S.C. 2341-2355), the TAAF program assists import-impacted U.S. 
manufacturing, oil and natural gas production, and service firms with 
developing and

[[Page 42832]]

implementing projects to regain global competitiveness, expand markets, 
strengthen operations, and increase profitability, thereby increasing 
U.S. jobs.
    The TAAF program provides cost-sharing technical assistance to 
eligible import-impacted U.S. manufacturing, oil and natural gas 
production, and service firms in all 50 States, the District of 
Columbia and the Commonwealth of Puerto Rico. Technical assistance is 
provided through a nationwide network of 11 TAACs, which are non-
profits or university-affiliated.
    TAACs provide eligible firms with customized assistance from 
industry experts knowledgeable about the unique needs, challenges, and 
opportunities facing industries in their respective regions. Firms work 
with the TAACs to apply for certification of eligibility for TAAF 
assistance. Firms demonstrate their eligibility by documenting that 
they have experienced a decline in sales or a decline or impending 
decline in employment or worker hours, and that an increase of imports 
of directly competitive goods or services contributed importantly to 
such declines. EDA then renders a decision regarding the firms' 
eligibility.
    The TAAC works closely with eligible firms' management to identify 
the firms' strengths and weaknesses and then develop a customized 
business recovery plan, called an Adjustment Proposal (AP), designed to 
stimulate recovery and growth. The TAAF program pays up to 75 percent 
of the costs of developing the AP. EDA reviews firms' APs and 
determines whether or not to approve them. When the AP has been 
approved, company management and TAAC staff jointly identify 
consultants with the specific expertise needed to help the firm 
implement the AP. For consultant costs that are above the acquisition 
threshold for sole source contracts, selection is made through a 
competitive procurement process. The TAACs and firms then enter into a 
contract with the private consultants, and the TAACs pay up to 75 
percent of the costs of the consultants.

Overview of Proposed Changes to the TAAF Regulations

    The discussion that follows presents the proposed changes by 
subpart letter and section number, with an explanation for each 
proposal.

Subpart A

    EDA proposes no changes to the designation or heading of this 
subpart. EDA proposes to transfer Sec. Sec.  315.4 and 315.5 from 
Subpart A to Subpart B. This proposed change would retain all general 
provisions (purpose and scope, definitions, and Confidential Business 
Information) within Subpart A, while consolidating those regulations 
regarding TAAC selection, operation, role, and coverage within Subpart 
B.

Section 315.1

    EDA proposes replacing this section with a new programmatic 
description of TAAF's purpose. The revised section will more clearly 
lay out the process by which EDA executes its responsibilities 
concerning the TAAF program, as delegated by the Secretary of Commerce, 
and the process by which firms work with TAACs to request and obtain 
Adjustment Assistance. EDA also proposes adding a citation to those 
sections of the Trade Act of 1974 which establish the responsibilities 
and requirements associated with the TAAF program.

Section 315.2

    EDA proposes a minor wording change to the introduction to the 
definitions, as well as changes to the definitions identified below.

Adjustment Assistance

    EDA proposes three revisions to the definition of Adjustment 
Assistance. First, EDA proposes to remove the reference to ``or 
industries.'' As explained further in the discussion of the changes to 
section 315.17, EDA proposes to eliminate its regulations related to 
the provision of trade adjustment assistance to industries. EDA has 
historically not provided separate industry-wide assistance programs 
because firms within impacted industries have solicited help through 
TAAF on an individual basis and because there has been no demand for 
industry-wide assistance. In addition, EDA provides expedited review of 
petitions and Adjustment Plans from firms within impacted industries. 
When the U.S. International Trade Commission (ITC) makes an injury 
determination, in accordance with Chapter 3 of the Trade Act, EDA 
provides expedited consideration to petitions by firms in the affected 
industry, as well as expedited assistance in preparing and processing 
Adjustment Proposal applications to such firms. EDA believes this 
individualized approach has been effective in facilitating adjustments 
within both firms and industries. Removing regulations that reference 
trade adjustment assistance to industries will help prevent potential 
confusion regarding the availability of a parallel industry program. In 
the event that EDA does determine it is appropriate to provide trade 
adjustment assistance for industries, EDA will promulgate new 
regulations to implement the program.
    Second, EDA proposes to revise the definition to clarify that 
Adjustment Assistance refers to technical assistance provided by the 
TAACs. The current regulation is ambiguous and could be interpreted 
that EDA provides the technical assistance directly, which is not the 
case. Third, EDA proposes adding to the definition a statement that EDA 
determines what type of assistance is provided and to incorporate a 
list of the types of assistance that this may include: Preparing a 
firm's petition for certification of eligibility, developing an 
Adjustment Proposal, and implementing an Adjustment Proposal.

Adjustment Proposal

    EDA proposes revising the definition for Adjustment Proposal, 
clarifying that the Adjustment Proposal is a firm's plan for improving 
its competitiveness in the marketplace, consistent with the intent of 
the TAAF program as established in the Trade Act. The current 
regulations state that the purpose of an Adjustment Proposal is to 
improve the firm's economic situation, a less clear goal not linked to 
the purposes of the Trade Act.

Decreased Absolutely

    EDA proposes a minor change to the definition of Decreased 
Absolutely to add language clarifying that a firm's sales or production 
must have declined by a minimum of five percent relative to its sales 
or production during the applicable time period and that the decline is 
independent of industry or market fluctuations and relative only to the 
previous performance of the firm unless EDA determines that such 
limitations would not be consistent with the purposes of the Trade Act. 
While it is implied in the existing regulations that all three of these 
factors must be present to constitute an absolute decrease in a firm's 
sales or production, EDA believes this minor revision will provide 
clear confirmation of this requirement.

Directly Competitive

    EDA proposes revising the defined term Directly Competitive to add 
the words ``or Like'' to the end, such that the term would be Directly 
Competitive or Like. This change would more closely align this term 
with the terminology of the Trade Act. EDA proposes further revising 
this definition by adding language that clarifies the linkage between 
this definition and the reference to firms that engage in exploring, 
drilling, or producing oil or natural gas. By adding the phrase ``For

[[Page 42833]]

the purposes of this term,'' before the final sentence in this 
definition, EDA reinforces the requirement in Section 251 of the Trade 
Act that firms that engage in these types of activities be considered 
as producing articles that are directly competitive with imported oil 
and natural gas for the purposes of TAAF eligibility.

Firm

    EDA proposes revising the definition of Firm to correct the 
citation to the section of the Trade Act that defines this term. In 
addition, EDA proposes capitalizing the term, ``Unjustifiable 
Benefits,'' as referenced in this definition. This change is the result 
of EDA's proposal to include a definition for Unjustifiable Benefits, 
as described below. EDA also proposes further revising this definition 
by adding to the sub-definition of Subsidiary, which is included as a 
category of firm that may be considered jointly with another firm that 
is requesting Adjustment Assistance pursuant to TAAF in an effort to 
prevent Unjustifiable Benefits. EDA proposes to qualify the definition 
of Subsidiary by adding an explanation that a firm acquired by another 
firm but which operates independently of the acquiring firm is 
considered an Independent Subsidiary and may be considered separately 
from the acquiring firm as eligible for Adjustment Assistance. This 
change reflects existing practice and addresses a growing trend in 
petitions requesting Adjustment Assistance for firms that have been 
acquired by another firm but continue to operate independently after 
the acquisition, generally retaining the same management, maintaining 
control over management decisions, and otherwise continuing operations 
without significant change.

Increase in Imports

    EDA proposes revising the definition of Increase in Imports by 
making minor wording changes for increased clarity. EDA proposes 
further modification to this definition by moving the second sentence 
of this definition to the revised Subpart C (Certification of firms) as 
a new paragraph (c) in Sec.  315.6 (Certification Requirements). EDA 
believes this sentence more appropriately belongs in this Subpart C as 
a description of one way for a firm to demonstrate that it meets the 
eligibility requirements for Certification to apply for Adjustment 
Assistance. The sentence provides that a firm may submit certifications 
from a firm's customers that account for a significant percentage of 
the firm's decrease in sales or production, that the customers 
increased their purchase of imports of Directly Competitive or Like 
Articles or Services from a foreign country.

Partial Separation

    EDA proposes changing the definition of Partial Separation by 
replacing language denoting that this definition is with respect to any 
employment in a firm with language that clarifies that a Partial 
Separation occurs when there has been no increase in overall employment 
at the firm and either of the conditions currently described in this 
definition exist: (1) A reduction in an employee's work hours to 80 
percent or less of the employee's average weekly hours during the year 
of such reductions as compared to the preceding year; or (2) a 
reduction in the employee's weekly wage to 80 percent or less of his/
her average weekly wage during the year of such reduction as compared 
to the preceding year. EDA occasionally receives petitions submitted by 
firms whose overall employment figures have increased within the 
periods of time in question and which, nonetheless, assert that there 
has been a Partial Separation with regards to a certain portion of 
their workforce's work hours or weekly wages. EDA believes that this 
revision should resolve the apparent confusion caused by the current 
wording and clarify that a firm does not meet the eligibility criteria 
if its overall employment has increased during the relevant time 
period.

Service Sector Firm

    EDA proposes revising the definition of Service Sector Firm to 
remove the last two sentences of that definition because they are 
already included in the definition of firm. The first superfluous 
sentence states that when a Service Sector Firm owns or controls other 
Service Sector Firms, those firms may be considered a single Service 
Sector Firm for the purposes of requesting Adjustment Assistance when 
they furnish Directly Competitive or Like services or are exerting 
essential economic control over one or more servicing facilities. The 
second superfluous sentence notes that these firms may be Predecessor, 
Successor, Affiliate, or Subsidiary Firms as defined in the definition 
of firm.

Total Separation

    EDA proposes streamlining and clarifying the definition of Total 
Separation by removing the phrase ``with respect to any employment in a 
firm'' and adding the words ``in a firm'' after ``the laying off or 
termination of employment of an employee.''

Unjustifiable Benefits

    As noted above, EDA also proposes adding a definition for 
Unjustifiable Benefits. Under this new definition, Unjustifiable 
Benefits describe Adjustment Assistance inappropriately accruing to the 
benefit of (1) other firms that would not otherwise be eligible when 
provided to a firm or (2) any predecessor or successor firm, or any 
affiliated firm controlled or substantially beneficially owned by 
substantially the same person, rather than treating these entities as a 
single firm. EDA believes that this is an important concept that should 
be fully explained to help firms understand TAAF eligibility 
requirements, particularly when a firm has a relationship through 
ownership or control by another firm.

Section 315.3

    EDA proposes no revisions to this section.

Subpart B

    EDA proposes revising this subpart to consolidate and clarify all 
regulations regarding TAAC selection, operations, and coverage. The 
revised Subpart B, entitled ``TAAC Provisions,'' would be inserted 
after Sec.  315.3 and would include revised Sec. Sec.  315.4 and 315.5, 
which would be transferred to Subpart B from Subpart A.

Section 315.4

    EDA proposes revising the heading of Sec.  315.4 from ``Eligible 
applicants'' to ``TAAC Selection and Operation.'' EDA also proposes 
revising paragraph (a) of this section to better describe the TAAC 
selection process by replacing the words ``The following entities may 
apply for assistance to operate a TAAC'' with ``EDA solicits 
applications from organizations interested in operating a TAAC through 
Notice of Funding Opportunity announcements laying out selection and 
award criteria. The following entities are eligible to apply:''. EDA 
also proposes replacing ``or'' with ``and'' after subparagraph (2) to 
clarify that all of the types of entities listed in paragraph (a) are 
eligible to apply to be selected as a TAAC, including universities or 
affiliated organizations, States or local governments, and non-profit 
organizations.
    EDA proposes revising paragraph (b) of this section to replace the 
existing language, which lists the types of organizations assisting or 
representing industries in which a substantial number of firms or 
workers have been certified as eligible to apply for Adjustment 
Assistance under the Trade Act, with language explaining that

[[Page 42834]]

TAACs are awarded cooperative agreements that are subject to all 
Federal laws and to Federal, Department, and EDA policies, regulations, 
and procedures applicable to Federal financial assistance awards, 
including 2 CFR part 200, Uniform Administrative Requirements, Cost 
Principles, and Audit Requirements for Federal Awards, and that the 
TAACs work closely with EDA and import-impacted firms. EDA believes 
this new language clarifies the basis for the relationship between EDA 
and the TAACs and clarifies the legal, policy, and procedural criteria 
that govern this relationship.

Section 315.5

    EDA proposes revising the heading of this section from ``TAAC 
scope, selection, evaluation and awards'' to ``The Role and Geographic 
Coverage of the TAACs'' to more accurately reflect the focus of this 
section, particularly in the more streamlined version of the 
regulations being proposed by EDA in this Notice. EDA proposes revising 
paragraph (a) of this section by removing the introductory language, 
``TAAC purpose and scope,'' as unnecessary. EDA also proposes removing 
the numbered subparagraphs from paragraph (a) and, in that same 
paragraph, changing the third sentence, which currently reads, in part, 
``Information concerning TAACs serving particular areas may be obtained 
. . .'' from various EDA and TAAC websites. EDA proposes to revise that 
sentence to read: ``Information concerning TAACs and their coverage 
areas may be obtained . . .'' EDA anticipates that this change will 
clarify that information regarding all of the TAACs service areas, 
rather than just particular geographic areas, are available at these 
websites.
    EDA proposes renumbering subparagraphs (2) and (3) as paragraphs 
(b) and (c), respectively. EDA also proposes streamlining newly re-
designated paragraph (c) by removing the words ``providing assistance 
to a,'' renumbering subparagraphs (i) and (ii) as (1) and (2), 
respectively, and rewording those two subparagraphs as follows: ``(1) 
Helping a firm to prepare its petition for eligibility certification; 
and (2) Assisting Certified firms with diagnosing their strengths and 
weaknesses, and with developing and implementing an Adjustment 
Proposal.'' This change should provide enhanced clarity on the types of 
Adjustment Assistance a TAAC may provide a firm.
    EDA also proposes removing existing paragraphs (b), (c), and (d) in 
their entirety. These paragraphs discuss the application and evaluation 
process for TAACs to be awarded a cooperative agreement as well as the 
award requirements for the cooperative agreements. EDA believes these 
paragraphs are unnecessary, as these provisions and requirements would 
generally be covered in the Notice of Funding Opportunity used to 
announce the availability of funding for TAAC awards.

Subpart C

    EDA proposes revising Subpart C to consolidate all regulations 
regarding the certification of firms. The revised Subpart C would be 
entitled, ``Certification of Firms'' and would include Sec.  315.6 
through Sec.  315.10.

Section 315.6

    EDA proposes to revise the heading for Sec.  315.6 from ``Firm 
eligibility for Adjustment Assistance'' to ``Certification 
Requirements'' and revise paragraph (a) to remove the introductory 
language. EDA also proposes moving the matching share requirements for 
Adjustment Proposals as set forth in current paragraph (c)(2) to the 
new Sec.  315.11 (``Adjustment Proposal Process'') in Subpart D 
(``Adjustment Proposals''). EDA proposes eliminating the remaining 
requirements in Sec.  315.6. These remaining requirements are 
duplicative of other regulations in this Part and provide no additional 
guidance or clarity to the TAACs or firms. Moreover, EDA proposes 
adding to Sec.  315.6(a) a reference to the codified version of the 
relevant section of the Trade Act.
    In addition to these revisions, as noted above in the discussion 
regarding proposed revisions to the definition of Increase in Imports, 
EDA proposes adding a new paragraph (c) to this section and moving into 
this paragraph the language formerly located in the definition of 
Increase in Imports that enabled firms to help demonstrate that they 
meet the eligibility requirements for Adjustment Assistance by 
submitting certification from the firm's customers that account for a 
significant percentage of the firms' decrease in sales or production, 
that the customers increased their purchase of imports of Directly 
Competitive or Like Articles or Services from a foreign country. A 
comma has been added to this sentence after the word ``production'' to 
increase clarity. EDA proposes further adding to this new paragraph (c) 
a sentence specifying that such certification from a firm's customer 
must be submitted directly to a TAAC or to EDA. EDA believes this 
addition will ease some confusion by firms, some of which have 
requested their customers to provide such certification directly to the 
firms which subsequently pass on the certifications to EDA through the 
TAACs. While EDA recognizes the potential sensitivity and challenges 
involved with a firm asking one or more of its customers to certify 
that the customers have increased their purchase of imports relative to 
their purchase from U.S. suppliers, EDA believes that this information 
is critical to support claims of import impact. In addition, Section 
251(e) of the Trade Act requires these certifications to be made to the 
Secretary of Commerce, who has delegated this and the other 
responsibilities associated with the TAAF program to EDA.

Section 315.7

    EDA proposes re-designating the current Sec.  315.8 as Sec.  315.7 
and revising the section heading to capitalize the words ``Petitions'' 
and ``Certification'' to reflect the use of capitalization in the 
headings of the other sections within part 315.
    Because of the revisions discussed above, EDA also proposes 
revising the cross-reference in paragraph (b)(4) to cite to Sec.  
315.6(b), rather than to Sec.  315.7(b). This cross-reference links to 
the section describing the data on sales, production, and employment 
required to demonstrate a firm has met the established certification 
thresholds.
    Furthermore, EDA proposes revising paragraph (b)(5) to clarify the 
additional requirements for publicly-owned corporations when submitting 
financial information as part of their petitions for certification. EDA 
proposes revising the paragraph by adding the words, ``in addition'' 
and ``also'' to clarify that publicly-owned corporations should submit 
copies of the most recent Form 10-K annual reports (or Form 10-Q 
quarterly reports, as appropriate) filed with the U.S. Securities and 
Exchange Commission for the entire period covered by the petition in 
addition to the other requirements described in this same paragraph.
    EDA also proposes revising paragraph (b)(6) to make clear the 
information required regarding a firm's customers. Specifically, EDA 
proposes replacing the qualifier that the description relates to the 
``major'' customers of the firm with one that identifies the customers 
as ``accounting for a significant percent of the firm's decline.'' EDA 
proposes further revising this paragraph to clarify that firms should 
submit information regarding those customers' purchases or the firm's 
unsuccessful bids if there are no customers fitting the description 
outlined in this paragraph.

[[Page 42835]]

    EDA also proposes revising paragraph (e) by including a citation to 
the codified section of the Trade Act set forth in this paragraph and 
by updating the cross-reference to the section of part 315 that 
discusses certification requirements.
    EDA proposes revising paragraph (f) to clarify that, in order to 
withdraw a petition for certification, the petitioner must submit a 
request for withdrawal before EDA makes a determination regarding 
approval or denial of the certification. EDA proposes further revising 
this paragraph by updating the cross-reference cited in the second 
sentence of paragraph (f), which regards submission of a new petition, 
to reflect the re-designation of the section that discusses 
certification requirements from Sec.  315.7 to Sec.  315.6.
    EDA also proposes revising subparagraphs (1) and (2) in paragraph 
(g) of this section. EDA proposes revising subparagraph (1) to add the 
word ``requested'' before the word ``material'' in order to make clear 
that EDA may request additional material from a firm beyond what was 
submitted with the firm's original petition if necessary to make a 
determination regarding the firm's eligibility for Adjustment 
Assistance. In addition, EDA proposes revising subparagraph (1) to 
insert the word ``calendar'' before the word ``days.'' EDA also 
proposes making similar revisions to all references to ``days'' found 
throughout part 315. EDA proposes these changes to clarify that all 
references to ``days'' within part 315 refer to calendar days. The 
current regulations are not clear on whether these references to 
``days'' are calendar or business days. These revisions will bring the 
TAAF regulations into alignment with the Trade Act.
    EDA proposes revising subparagraph (2) of paragraph (g) by altering 
the final sentence to clarify that firms may not resubmit a petition 
within one year from the date of a denial without a waiver from EDA 
issued for good cause.

Section 315.8

    EDA proposes re-designating the current Sec.  315.9 as Sec.  315.8.
    For the reasons discussed above, EDA proposes inserting the word 
``calendar'' in front of the word ``days'' in the introductory 
paragraph to this section.
    EDA proposes revising paragraphs (a) and (c) by replacing the 
semicolon at the end of each paragraph with a period to reflect that 
each is a complete sentence.
    EDA proposes revising paragraph (b)(2) by deleting the word ``its'' 
and inserting the words ``the requesting party's'' in lieu thereof to 
clarify that, when someone other than the petitioner requests a public 
hearing on an accepted petition, the requester must include a statement 
describing the nature of the requester's interest in the proceedings.
    EDA also proposes revising paragraph (d) of this section to clarify 
that EDA will publish a notice of a public hearing in the Federal 
Register only if EDA has made the determination that the requesting 
party has a substantial interest in the hearing. EDA proposes further 
revising this paragraph by removing the semicolon and the word ``and'' 
from the end of the paragraph and adding a period.

Section 315.9

    EDA proposes re-designating the current Sec.  315.10 as Sec.  315.9 
and revising the section heading to capitalize the words 
``Certification'' and ``Benefits'' to reflect the use of capitalization 
in the headings of the other sections within part 315.
    EDA also proposes revising paragraphs (a), (b), and (d) to replace 
the word ``Failure'' at the beginning of each of those paragraphs with 
the words ``The firm failed'' to provide clarity regarding which 
entity's omission triggers the loss of certification benefits.
    In addition, EDA proposes revising paragraphs (a), (b), and (c) to 
replace the semicolons at the end of each of those paragraphs with a 
period to reflect that these are separate and not cumulative 
requirements. For the same reason, EDA proposes to further revise 
paragraph (c) by removing the word ``or'' from the end of that 
paragraph.
    EDA proposes further revising paragraph (d) by adding a comma after 
the words ``Adjustment Proposal'' and replacing the word ``where'' with 
the word ``and''. This paragraph, as revised, reads: ``(d) The firm 
failed to diligently pursue an approved Adjustment Proposal, and five 
years have elapsed since the date of certification.''

Section 315.10

    EDA proposes re-designating the current Sec.  315.11 as Sec.  
315.10 and revising the section heading to capitalize the words 
``Final,'' ``Determinations,'' ``Termination,'' and ``Certification,'' 
to reflect the use of capitalization in the headings of the other 
sections within part 315.
    EDA proposes revising paragraphs (a) and (b) of this section by 
inserting the word ``calendar'' before the word ``days'' for the 
reasons mentioned above. EDA proposes further revising paragraph (a) by 
updating the cross-references to the regulations regarding EDA's 
process for making determinations regarding petitions for 
certification. Specifically, EDA proposes changing the two references 
in this paragraph from Sec.  315.8(g) to Sec.  315.7(g). EDA proposes 
further revising paragraph (b) by adding a reference to the codified 
version of the cited section of the Trade Act.
    EDA proposes removing the designation of paragraph (d) and adding 
the sentence that formerly stood alone as paragraph (d) to the end of 
paragraph (c) in this same section. EDA believes this reorganization 
would reduce potential confusion by placing all requirements regarding 
the steps EDA takes when it terminates a certification, including 
notifying the petitioner and stating the reasons for such termination, 
in a single paragraph.

Subpart D

    EDA proposes no changes to the designation or heading of this 
subpart. However, EDA proposes to revise this subpart to include 
Sec. Sec.  315.11 and 315.12.

Section 315.11

    Section 315.11 would be revised to combine requirements currently 
contained in other sections of part 315 and add new language to reflect 
best practices. The section heading would be revised to be ``Adjustment 
Proposal Process.''
    EDA proposes moving paragraphs (a)(2) and (a)(3) from the current 
Sec.  315.6 to the revised Sec.  315.11 as paragraphs (a) and (b) 
within this section in order to consolidate Adjustment Proposal 
procedures within a single section. In addition, within paragraph (a) 
of Sec.  315.11, EDA proposes updating the cross-references to those 
sections within part 315 that refer to certification requirements and 
processing petitions for certification to reflect the changes discussed 
above. In line with these changes, the references cited in this 
paragraph would change from Sec. Sec.  315.7 and 315.8 to Sec. Sec.  
315.6 and 315.7, respectively. In order to more clearly reflect the 
requirements of the Trade Act, EDA proposes to move the requirement 
established in the current Sec.  315.16(a), which says Adjustment 
Proposals must be submitted to EDA for approval within two years after 
the date of Certification, to the newly designated Sec.  315.11(a).
    In addition to moving the requirements that currently exist in 
Sec.  315.6(a)(3) to the revised Sec.  315.11(b), EDA proposes adding 
language to these requirements that would require firms to begin 
implementation of their approved Adjustment Proposal within six months 
after approval. EDA also proposes adding a requirement that firms that 
do not begin implementation

[[Page 42836]]

within six months after approval must update and re-submit their 
Adjustment Proposal for re-approval before any Adjustment Assistance 
may be provided. These additions reflect long-standing practice and 
would help firms to ensure that their Adjustment Proposals reflect the 
most up-to-date economic conditions and financial situation and, 
consequently, that the firms will receive the most effective Adjustment 
Assistance.
    EDA proposes adding a paragraph (c) to this section that discusses 
how EDA will make a determination regarding the Adjustment Proposal no 
later than 60 calendar days after receipt of the Adjustment Proposal. 
This new language incorporates a requirement in Section 252(b)(2) of 
the Trade Act that the Secretary make a determination as soon as 
possible after the date on which an application is filed, but in no 
event later than 60 days after such date.
    EDA also proposes adding a paragraph (d) to this section. EDA 
proposes moving the matching share requirements for Adjustment 
Assistance from the existing Sec.  315.6(b)(2) to this paragraph. In 
addition, EDA proposes adding a sentence stating that certified firms 
may request no more than the amount established by EDA for total 
Adjustment Assistance over the entire lifetime of the firm. This 
proposed addition incorporates current practice, established to ensure 
that the maximum number of eligible firms are able to receive 
Adjustment Assistance and to encourage certified firms to appropriately 
plan and implement their Adjustment Proposals within established 
funding limits.
    EDA proposes adding a paragraph (e) to this section and specifying 
within this paragraph that firms may request EDA approval to amend 
their Adjustment Plans within two years from the date of EDA approval 
of their initial Adjustment Plans. This new language incorporates 
current practice and allows firms to update their Adjustment Plans as 
needed within the two-year time frame to address any unexpected changes 
in their situation, new information, or a need to re-direct resources 
to areas of greatest need.
    EDA also proposes adding a paragraph (f) to this section. The 
proposed paragraph (f) requires firms to complete implementation of 
their Adjustment Plans within five years of EDA approval of their 
initial Adjustment Plan. This added language reflects current practice 
and EDA's expectation that firms who request Adjustment Assistance are 
financially and operationally prepared to engage in the TAAF program 
and will implement their Adjustment Plan in a timely way.
    EDA proposes adding a paragraph (g) to this section to address what 
occurs if a Certified firm is transferred, sold, or otherwise acquired 
by another firm during the five-year period established in paragraph 
(f). Paragraph (g) requires a Certified firm that is transferred, sold, 
or otherwise acquired by another firm during the five-year period of 
Adjustment Assistance to notify EDA no later than 30 calendar days 
following the transfer, sale, or acquisition. EDA will then make a 
determination as to whether the firm remains eligible for Adjustment 
Assistance. EDA will make this determination no later than 60 calendar 
days following notification by the firm. This new language incorporates 
current practice and is designed to resolve any confusion about how 
firms and TAACs should handle this type of scenario.
    Finally, EDA proposes adding a paragraph (h) to this section. 
Paragraph (h) would require firms that receive Adjustment Assistance to 
provide data regarding the firms' sales, employment, and productivity 
upon completion of the program and each year for the two-year period 
following completion. This language incorporates into the regulations 
reporting requirements established in Section 255A of the Trade Act, 
which requires EDA to report annually to Congress on data regarding the 
TAAF program for the preceding fiscal year.

Section 315.12

    EDA proposes revising the heading of this section to capitalize the 
words ``Proposal'' and ``Requirements'' to reflect the use of 
capitalization in the headings of the other sections within part 315.
    In addition, as discussed above, EDA proposes eliminating paragraph 
(a) of this section after moving the requirement that firms must submit 
their Adjustment Proposals to EDA within two years of the date of 
certification to Sec.  315.11(a).
    As a result of this proposed elimination of paragraph (a), EDA 
proposes re-designating the remaining paragraphs such that the existing 
paragraph (b) is re-designated paragraph (a), paragraph (c) becomes 
paragraph (b), and paragraph (d) becomes paragraph (c).

Subpart E

    EDA proposing revising the heading for this subpart to ``Protective 
Provisions.'' As revised, Subpart E would include Sec. Sec.  315.13 and 
315.14. EDA proposes moving the requirements regarding persons engaged 
by firms to expedite petitions and Adjustment Proposals as found in the 
current Sec.  315.14 (Certifications) and the requirements regarding 
conflicts of interest that are contained the current Sec.  315.15 
(Conflicts of interest), both of which are found in the current Subpart 
C, to Subpart E. EDA believes this reorganization and new location will 
make it easier for firms to read and understand the regulations and 
will help clarify that these provisions apply to firms at all stages of 
the TAAF process.

Section 315.13

    EDA proposes moving the requirements for firms to certify in 
writing to EDA the names of any attorneys, agents, and other Persons 
engaged by or on behalf of the firm for the purpose of expediting 
Petitions for Adjustment Assistance and the fees paid or to be paid to 
any such Person, as found in the current Sec.  315.14, to Sec.  315.13. 
EDA proposes further revising these requirements by clarifying, in 
paragraph (a), that they apply to both Adjustment Assistance and 
Adjustment Proposals.

Section 315.14

    EDA proposes moving the requirements found in the current Sec.  
315.15 to Sec.  315.14. EDA also proposes revising these requirements 
by modifying the list of firm representatives subject to the conflicts 
of interest requirements to parallel the list of firm representatives 
identified in the revised Sec.  315.13. With this revision, Sec.  
315.14 applies the conflict of interest requirements to the ``owners, 
partners, members, directors or officers'' of the firm, replacing the 
prior language applying these requirements to the ``owners, partners, 
or officers'' of the firm.

Subpart F

    EDA proposes adding Subpart F, entitled ``International Trade 
Commission Investigations.'' Subpart F sets forth, through Sec.  
315.15--what actions EDA takes when the ITC makes an affirmative 
finding under the Trade Act or under sections 705 or 735 of the Tariff 
Act regarding injury or threat of injury to an industry.

Section 315.15

    EDA proposes revising the heading of this section to ``Affirmative 
Findings.'' EDA also proposes removing the designation ``(a)'' from the 
first paragraph of this section and eliminating paragraphs (b) and (c) 
to reflect the fact that EDA, historically,

[[Page 42837]]

has not provided Adjustment Assistance for the establishment of 
industry-wide programs for new product development, export development, 
or other uses consistent with the purposes of the Trade Act because 
there has been no demand for such programs. As noted above in the 
discussion regarding proposed changes to the definition of Adjustment 
Assistance in Sec.  315.2, firms within impacted industries have sought 
Adjustment Assistance through TAAF on an individual basis rather than 
through industry-wide solutions. EDA also provides expedited review of 
petitions and Adjustment Plans from firms within industries that have 
received an injury determination by the ITC. This individualized 
approach enables EDA to support adjustments at the firm level, while 
having a cumulative impact at the industry level.
    EDA proposes further revising this section by correcting the 
citation, within the first paragraph, to read ``section 202(b) of the 
Trade Act'' with a lower case (b) as is used in the Trade Act. EDA also 
proposes citing to the codified form of the relevant section of the 
Trade Act, 19 U.S.C. 2252, within that first paragraph and updating the 
paragraph by including a reference to sections 705 and 735 of the 
Tariff Act (19 U.S.C. 1671d, 1673d). Furthermore, EDA proposes 
replacing within this paragraph the language stating that EDA will 
provide to firms in the identified industry assistance in the 
preparation and processing of petitions and applications for benefits; 
EDA instead will include language establishing notification to the 
TAACs and expedited review of petitions and Adjustment Plans from firms 
within the specified industry. EDA believes these revisions more 
clearly describe the assistance EDA provides to industries in response 
to determinations made by the International Trade Commission under the 
Trade and Tariff Acts.

Part II: Updates to PWEDA Regulations

PWEDA Background

    PWEDA is EDA's organic authority and is the primary legal authority 
under which EDA awards grants. Other legal authorities include the 
Trade Act and the Stevenson-Wydler Technology Innovation Act of 1980. 
Under PWEDA, EDA provides financial assistance to both rural and urban 
distressed communities by fostering entrepreneurship, innovation, and 
productivity through investments in infrastructure development, 
capacity building, and business development in order to attract private 
capital investments and new and better jobs to regions experiencing 
substantial and persistent economic distress.

Overview of PWEDA Regulations Proposed for Elimination

    EDA proposes eliminating certain provisions within part 302 of the 
PWEDA regulations that are unnecessary or already established in other 
regulations or award documentation. Specifically, EDA is proposing to 
eliminate the regulations located at 13 CFR 302.4, 302.5, and 302.14. 
These regulations describe: The responsibilities of EDA grant 
recipients to maintain records, how information supplied to EDA may be 
subject to public release under the Freedom of Information Act or 
Privacy Act, how government auditors may need access to various 
records, and that grant recipients are subject to the government-wide 
relocation assistance and land acquisition policies. These regulations 
can be removed because notice is already provided to grant recipients 
through other Department of Commerce-wide or government-wide 
regulations as well as in specific documentation EDA provides to each 
grant recipient. Specifically, recipients of EDA financial assistance 
are already subject to the requirements related to the Freedom of 
Information Act or Privacy Act currently described in Sec.  302.4 
through 15 CFR part 4 and the Standard Terms and Conditions of an EDA 
award. Similarly, the relocation and land acquisition policies 
currently found in Sec.  302.5 are already applicable to all EDA 
financial assistance recipients under government-wide regulations found 
at 49 CFR part 24. Finally, the record-keeping requirements currently 
located in Sec.  302.14 duplicate the requirements of Section 608 of 
PWEDA (42 U.S.C. 3218), 2 CFR 200.333 and 200.336, and the Standard 
Terms and Conditions of an EDA award.
    In addition, EDA is proposing the elimination of 13 CFR 302.11. 
Beginning with the enactment of the original section 502 of PWEDA (42 
U.S.C. 3192) in 1998, Congress has required EDA to maintain an economic 
development information clearinghouse on matters related to economic 
development, economic adjustment, disaster recovery, defense 
conversion, and trade adjustment programs and activities. See Public 
Law 105-393. With the EDA Reauthorization Act of 2004 (Pub. L. 108-373 
(Oct. 27, 2004)), Congress amended section 502 to require EDA to, among 
other things, maintain this information clearinghouse online. The 
current regulation adds nothing of value to the requirements already in 
place under section 502 and consequently should be eliminated.

Classification

    Prior notice and opportunity for public comment are not required 
for rules concerning public property, loans, grants, benefits, and 
contracts (5 U.S.C. 553(a)(2)). EDA's programs, including TAAF, are 
financial assistance programs provided through grants and cooperative 
agreements. As such, prior notice and an opportunity for public comment 
are not required pursuant to 5 U.S.C. 553, or any other law, and the 
analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 
et seq.) are inapplicable. Therefore, a regulatory flexibility analysis 
has not been prepared.

Executive Orders No. 12866, 13563, and 13771

    This proposed rule was drafted in accordance with Executive Orders 
12866, 13563, and 13771. The Office of Management and Budget (OMB) has 
determined that this proposed rule is not significant for purposes of 
Executive Order 12866 and Executive Order 13563.
    This proposed rule is a deregulatory action that has a neutral 
effect on the costs to firms, organizations, and all other stakeholders 
to comply with the regulations discussed in this NPRM. It is therefore 
considered to have a total incremental cost of zero pursuant to the 
April 5, 2017, OMB guidance memorandum implementing Executive Order 
13771.

Congressional Review Act

    This proposed rule is not major under the Congressional Review Act 
(5 U.S.C. 801 et seq.).

Executive Order No. 13132

    Executive Order 13132 requires agencies to develop an accountable 
process to ensure ``meaningful and timely input by State and local 
officials in the development of regulatory policies that have 
federalism implications.'' ``Policies that have federalism 
implications'' is defined in Executive Order 13132 to include 
regulations that have ``substantial direct effects on the States, on 
the relationship between the national government and the States, or on 
the distribution of power and responsibilities among the various levels 
of government.'' It has been determined that this proposed rule does 
not contain policies that have federalism implications.

[[Page 42838]]

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) 
(``PRA'') requires that a Federal agency consider the impact of 
paperwork and other information collection burdens imposed on the 
public and, under the provisions of PRA Sec.  3507(d), obtain approval 
from OMB for each collection of information it conducts, sponsors, or 
requires through regulations. Notwithstanding any other provision of 
law, no person is required to respond to, nor shall any person be 
subject to a penalty for failure to comply with a collection of 
information subject to the PRA unless that collection displays a 
currently valid OMB Control Number.
    The following table provides the only collection of information 
(and corresponding OMB Control Numbers) set forth in this proposed 
rule. This collection of information is necessary for the proper 
performance and functions of EDA. The proposed rule does not include a 
new information collection requirement and will, thus, use the 
previously approved ED-840p form to collect information relevant to a 
petition for certification of eligibility for trade adjustment 
assistance.

------------------------------------------------------------------------
  Part or  section of                                  Form/title/OMB
   this proposed rule        Nature of request           control No.
------------------------------------------------------------------------
315.7(b)...............  All firms seeking          ED-840p, Petition by
                          certification of           a firm for
                          eligibility to apply for   Certification of
                          trade adjustment           Eligibility to
                          assistance must complete   Apply for Trade
                          the ED-840p form, which    Adjustment
                          provides EDA with the      Assistance (0610-
                          information needed to      0091).
                          determine if a firm is
                          eligible to apply for
                          trade adjustment
                          assistance.
------------------------------------------------------------------------

List of Subjects

13 CFR Part 302

    Community development, Grant programs-business, Grant programs-
housing and community development, Technical assistance.

13 CFR Part 315

    Administrative practice and procedure, Community development, Grant 
programs-business, Reporting and recordkeeping requirements, Trade 
adjustment assistance.

    For the reasons discussed above, EDA proposes to amend 13 CFR, 
chapter III as follows:

PART 302--GENERAL TERMS AND CONDITIONS FOR INVESTMENT ASSISTANCE

0
1. The authority citation of part 302 continues to read as follows:

    Authority: 19 U.S.C. 2341 et seq.; 42 U.S.C. 3150; 42 U.S.C. 
3152; 42 U.S.C. 3153; 42 U.S.C. 3192; 42 U.S.C. 3193; 42 U.S.C. 
3194; 42 U.S.C. 3211; 42 U.S.C. 3212; 42 U.S.C. 3216; 42 U.S.C. 
3218; 42 U.S.C. 3220; 42 U.S.C. 5141; 15 U.S.C. 3701; Department of 
Commerce Delegation Order 10-4.


Sec.  Sec.  302.4 and 302.5  [Removed]

0
2. Remove Sec. Sec.  302.4 and 302.5.


Sec.  302.11  [Removed]

0
3. Remove Sec.  302.11.


Sec.  302.14  [Removed]

0
4. Remove Sec.  302.14.

PART 315--TRADE ADJUSTMENT ASSISTANCE FOR FIRMS

0
5. Revise the authority citation of part 315 to read as follows:

    Authority:  19 U.S.C. 2341 et seq., as amended by Division B, 
Title I, Subtitle I, Part II of Pub. L. 111-5, 42 U.S.C. 3211; Pub. 
L. 111-344, 124 Stat. 3611; Pub. L. 112-40, 125 Stat. 401; Pub. L. 
113-203; Pub. L. 114-27; Department of Commerce Delegation Order 10-
4.

0
6. Revise Sec.  315.1 to read as follows:


Sec.  315.1   Purpose and Scope

    Chapter 3 of title II of the Trade Act of 1974 (19 U.S.C. 2341-
2355) establishes the responsibilities of the Secretary of Commerce 
concerning the Trade Adjustment Assistance for Firms (TAAF) program. 
The regulations in this part lay out those responsibilities as 
delegated to EDA by the Secretary. EDA executes these responsibilities 
through cooperative agreements that support a network of Trade 
Adjustment Assistance Centers (TAACs). The TAACs assist Firms in 
petitioning EDA for certification of eligibility to receive Adjustment 
Assistance. EDA certifies the eligibility of Firms. The TAACs then 
provide Adjustment Assistance to Firms through the development and 
implementation of Adjustment Proposals.
0
7. Amend Sec.  315.2 by:
0
a. Revising the introductory paragraph;
0
b. Revising the definitions for ``Adjustment Assistance'', ``Adjustment 
Proposal'', ``Decreased Absolutely'', and ``Directly Competitive'';
0
c. Amending the definition of ``Firm'' by revising the introductory 
text and paragraph (4);
0
d. Revising the definitions of ``Increase in Imports'', ``Partial 
Separation'', ``Service Sector Firm'', and ``Total Separation''; and
0
c. Adding in alphabetical order a definition for ``Unjustifiable 
Benefits''.
    The revisions and additions read as follows:


Sec.  315.2   Definitions

    In addition to the defined terms set forth in Sec.  300.3 of this 
chapter, the following terms used in this part shall have the meanings 
set forth below:
    Adjustment Assistance means technical assistance provided to Firms 
by TAACs under chapter 3 of title II of the Trade Act. The type of 
assistance provided is determined by EDA and may include one or more of 
the following:
    (1) Assistance in preparing a Firm's petition for certification of 
eligibility;
    (2) Assistance to a Certified Firm in developing an Adjustment 
Proposal for the Firm; and
    (3) Assistance to a Certified Firm in implementing an Adjustment 
Proposal.
    Adjustment Proposal means a Certified Firm's plan for improving the 
Firm's competitiveness in the marketplace.
* * * * *
    Decreased Absolutely means a firm's sales or production has 
declined by a minimum of five percent relative to its sales or 
production during the applicable prior time period, and this decline 
is:
* * * * *
    Directly Competitive or Like means imported articles or services 
that compete with and are substantially equivalent for commercial 
purposes (i.e., are adapted for the same function or use and are 
essentially interchangeable) as the Firm's articles or services. For 
the purposes of this term, any Firm that engages in exploring or 
drilling for oil or natural gas, or otherwise produces oil or natural 
gas, shall be considered to be producing articles directly competitive 
with imports of oil and with imports of natural gas.
    Firm means an individual proprietorship, partnership, joint 
venture, association, corporation (includes a development corporation),

[[Page 42839]]

business trust, cooperative, trustee in bankruptcy or receiver under 
court decree, and includes fishing, agricultural or service sector 
entities and those which explore, drill or otherwise produce oil or 
natural gas. See also the definition of Service Sector Firm. Pursuant 
to section 259 of chapter 3 of title II of the Trade Act (19 U.S.C. 
2351), a Firm, together with any predecessor or successor firm, or any 
affiliated firm controlled or substantially beneficially owned by 
substantially the same person, may be considered a single Firm where 
necessary to prevent Unjustifiable Benefits. For purposes of receiving 
benefits under this part, when a Firm owns or controls other Firms, the 
Firm and such other Firms may be considered a single Firm when they 
produce or supply like or Directly Competitive articles or services or 
are exerting essential economic control over one or more production 
facilities. Accordingly, such other Firms may include a(n):
    (1) * * *
    (4) Subsidiary--a company (either foreign or domestic) that is 
wholly owned or effectively controlled by another company. A Firm that 
has been acquired by another Firm but which maintains operations 
independent of the acquiring Firm is considered an Independent 
Subsidiary and may be considered separately from the acquiring Firm as 
eligible for TAAF assistance.
    Increase in Imports means an increase in imports of Directly 
Competitive or Like Articles or Services with articles produced or 
services supplied by a Firm.
* * * * *
    Partial Separation occurs when there has been no increase in 
overall employment at the Firm and either of the following applies:
* * * * *
    Service Sector Firm means a Firm engaged in the business of 
supplying services.
* * * * *
    Total Separation means the laying off or termination of employment 
of an employee in a Firm for lack of work.
    Unjustifiable Benefits means Adjustment Assistance inappropriately 
accruing to the benefit of:
    (1) Other Firms that would not otherwise be eligible when provided 
to a Firm; or
    (2) Any predecessor or successor Firm, or any affiliated Firm 
controlled or substantially beneficially owned by substantially the 
same person, rather than treating these entities as a single Firm.


Sec.  Sec.  315.4 and 315.5  [Amended]

0
8. Transfer Sec. Sec.  315.4 and 315.5 from subpart A to subpart B;
0
9. Revise subparts B through E and add subpart F to read as follows:
Subpart B--TAAC Provisions
Sec.
315.4 TAAC Selection and Operation
315.5 The Role and Geographic Coverage of the TAACs
Subpart C--Certification of Firms
Sec.
315.6 Certification Requirements
315.7 Processing Petitions for Certification
315.8 Hearings
315.9 Loss of Certification Benefits
315.10 Appeals, Final Determinations and Termination of 
Certification
Subpart D--Adjustment Proposals
Sec.
315.11 Adjustment Proposal Process
315.12 Adjustment Proposal Requirements
Subpart E--Protective Provisions
Sec.
315.13 Persons Engaged by Firms to Expedite Petitions and Adjustment 
Proposals.
315.14 Conflicts of Interest
Subpart F--International Trade Commission Investigations
Sec.
315.15 Affirmative Findings.

Subpart B--TAAC Provisions


Sec.  315.4   TAAC Selection and Operation.

    (a) EDA solicits applications from organizations interested in 
operating a TAAC through Notice of Funding Opportunity announcements 
laying out selection and award criteria. The following entities are 
eligible to apply:
    (1) Universities or affiliated organizations;
    (2) States or local governments; or
    (3) Non-profit organizations.
    (b) Entities selected to operate the TAACs are awarded cooperative 
agreements and work closely with EDA and import-impacted firms. TAAC 
cooperative agreements are subject to all Federal laws and to Federal, 
Department, and EDA policies, regulations, and procedures applicable to 
Federal financial assistance awards, including 2 CFR part 200, Uniform 
Administrative Requirements, Cost Principles, and Audit Requirements 
for Federal Awards.


Sec.  315.5   The Role and Geographic Coverage of the TAACs.

    (a) TAACs are available to assist Firms in obtaining Adjustment 
Assistance in all 50 U.S. States, the District of Columbia and the 
Commonwealth of Puerto Rico. TAACs provide Adjustment Assistance in 
accordance with this part either through their own staffs or by 
arrangements with outside consultants. Information concerning TAACs and 
their coverage areas may be obtained from the TAAC website at http://www.taacenters.org or from EDA at http://www.eda.gov.
    (b) Prior to submitting a petition for Adjustment Assistance to 
EDA, a Firm should determine the extent to which a TAAC can provide the 
required Adjustment Assistance. EDA will provide Adjustment Assistance 
through TAACs whenever EDA determines that such assistance can be 
provided most effectively in this manner. Requests for Adjustment 
Assistance will be made through TAACs.
    (c) A TAAC generally provides Adjustment Assistance by:
    (1) Helping a Firm to prepare its petition for eligibility 
certification; and
    (2) Assisting Certified Firms with diagnosing their strengths and 
weaknesses, and with developing and implementing an Adjustment 
Proposal.

Subpart C--Certification of Firms


Sec.  315.6   Certification Requirements.

    (a) General. Firms apply for certification through a TAAC by 
completing a petition for certification. The TAAC will assist Firms in 
completing such petitions at no cost to the Firms. EDA evaluates Firms' 
petitions based on the requirements set forth in Sec.  315.7. EDA may 
certify a Firm as eligible to apply for Adjustment Assistance under 
section 251(c) of the Trade Act (19 U.S.C. 2341) if it determines that 
the petition for certification meets one of the minimum certification 
thresholds set forth in paragraph (b) of this section. In order to be 
certified, a Firm must meet the criteria listed under any one of the 5 
circumstances described in paragraph (b) of this section.
    (b) Minimum certification thresholds. (1) Twelve-month decline. 
Based upon a comparison of the most recent 12-month period for which 
data are available and the immediately preceding twelve-month period:
    (i) A Significant Number or Proportion of Workers in the Firm has 
undergone Total or Partial Separation or a Threat of Total or Partial 
Separation;
    (ii) Either sales or production, or both, of the Firm has Decreased 
Absolutely; or sales or production, or both, of any article or service 
that accounted for not less than 25 percent of the total production or 
sales of the Firm during the 12-month period preceding the most recent 
12-month period for which data are available have Decreased Absolutely; 
and

[[Page 42840]]

    (iii) An Increase in Imports has Contributed Importantly to the 
applicable Total or Partial Separation or Threat of Total or Partial 
Separation, and to the applicable decline in sales or production or 
supply of services.
    (2) Twelve-month versus twenty-four month decline. Based upon a 
comparison of the most recent 12-month period for which data are 
available and the immediately preceding 24-month period:
    (i) A Significant Number or Proportion of Workers in the Firm has 
undergone Total or Partial Separation or a Threat of Total or Partial 
Separation;
    (ii) Either average annual sales or production, or both, of the 
Firm has Decreased Absolutely; or average annual sales or production, 
or both, of any article or service that accounted for not less than 25 
percent of the total production or sales of the Firm during the 24-
month period preceding the most recent 12-month period for which data 
are available have Decreased Absolutely; and
    (iii) An Increase in Imports has Contributed Importantly to the 
applicable Total or Partial Separation or Threat of Total or Partial 
Separation, and to the applicable decline in sales or production or 
supply of services.
    (3) Twelve-month versus thirty-six month decline. Based upon a 
comparison of the most recent 12-month period for which data are 
available and the immediately preceding 36-month period:
    (i) A Significant Number or Proportion of Workers in the Firm has 
undergone Total or Partial Separation or a Threat of Total or Partial 
Separation;
    (ii) Either average annual sales or production, or both, of the 
Firm has Decreased Absolutely; or average annual sales or production, 
or both, of any article or service that accounted for not less than 25 
percent of the total production or sales of the Firm during the 36-
month period preceding the most recent 12-month period for which data 
are available have Decreased Absolutely; and
    (iii) An Increase in Imports has Contributed Importantly to the 
applicable Total or Partial Separation or Threat of Total or Partial 
Separation, and to the applicable decline in sales or production or 
supply of services.
    (4) Interim sales or production decline. Based upon an interim 
sales or production decline:
    (i) Sales or production has Decreased Absolutely for, at minimum, 
the most recent six-month period during the most recent 12-month period 
for which data are available as compared to the same six-month period 
during the immediately preceding 12-month period;
    (ii) During the same base and comparative period of time as sales 
or production has Decreased Absolutely, a Significant Number or 
Proportion of Workers in such Firm has undergone Total or Partial 
Separation or a Threat of Total or Partial Separation; and
    (iii) During the same base and comparative period of time as sales 
or production has Decreased Absolutely, an Increase in Imports has 
Contributed Importantly to the applicable Total or Partial Separation 
or Threat of Total or Partial Separation, and to the applicable decline 
in sales or production or supply of services.
    (5) Interim employment decline. Based upon an interim employment 
decline:
    (i) A Significant Number or Proportion of Workers in such Firm has 
undergone Total or Partial Separation or a Threat of Total or Partial 
Separation during, at a minimum, the most recent six-month period 
during the most recent 12-month period for which data are available as 
compared to the same six-month period during the immediately preceding 
12-month period; and
    (ii) Either sales or production of the Firm has Decreased 
Absolutely during the 12-month period preceding the most recent 12-
month period for which data are available; and
    (iii) An Increase in Imports has Contributed Importantly to the 
applicable Total or Partial Separation or Threat of Total or Partial 
Separation, and to the applicable decline in sales or production or 
supply of services.
    (c) EDA may consider as evidence of an Increase in Imports a 
certification from the Firm's customers that account for a significant 
percentage of the Firm's decrease in sales or production, that they 
have increased their purchase of imports of Directly Competitive or 
Like Articles or Services from a foreign country, either absolutely or 
relative to their acquisition of such Like Articles or Services from 
suppliers located in the United States. Such certification from a 
Firm's customer must be submitted directly to a TAAC or to EDA.


Sec.  315.7   Processing Petitions for Certification.

    (a) Firms shall consult with a TAAC for guidance and assistance in 
the preparation of their petitions for certification.
    (b) A Firm seeking certification shall complete a Petition by a 
Firm for Certification of Eligibility to Apply for Trade Adjustment 
Assistance (Form ED-840P or any successor form) with the following 
information about such Firm:
    (1) Identification and description of the Firm, including legal 
form of organization, economic history, major ownership interests, 
officers, directors, management, parent company, Subsidiaries or 
Affiliates, and production and sales facilities;
    (2) Description of goods or services supplied or sold;
    (3) Description of imported Directly Competitive or Like Articles 
or Services with those produced or supplied;
    (4) Data on its sales, production and employment for the applicable 
24-month, 36-month, or 48-month period, as required under Sec.  
315.6(b);
    (5) One copy of a complete auditor's certified financial report for 
the entire period covering the petition, or if not available, one copy 
of the complete profit and loss statements, balance sheets and 
supporting statements prepared by the Firm's accountants for the entire 
period covered by the petition. In addition, publicly-owned 
corporations should also submit copies of the most recent Form 10-K 
annual reports (or Form 10-Q quarterly reports, as appropriate) filed 
with the U.S. Securities and Exchange Commission for the entire period 
covered by the petition.
    (6) Information concerning customers accounting for a significant 
percent of the Firm's decline and the customers' purchases (or the 
Firm's unsuccessful bids, if there are no customers fitting this 
description); and
    (7) Such other information as EDA considers material.
    (c) EDA shall determine whether the petition has been properly 
prepared and can be accepted. Promptly thereafter, EDA shall notify the 
petitioner that the petition has been accepted or advise the TAAC that 
the petition has not been accepted, but may be resubmitted at any time 
without prejudice when the specified deficiencies have been corrected. 
Any resubmission will be treated as a new petition.
    (d) EDA will publish a notice of acceptance of a petition in the 
Federal Register.
    (e) EDA will initiate an investigation to determine whether the 
petitioner meets the requirements set forth in section 251(c) of the 
Trade Act (19 U.S.C. 2341) and Sec.  315.6.
    (f) A petition for certification may be withdrawn if EDA receives a 
request for withdrawal submitted by the petitioner before EDA makes a 
certification determination or denial. A Firm may submit a new petition 
at any time thereafter in accordance with the requirements of this 
section and Sec.  315.6.

[[Page 42841]]

    (g) Following acceptance of a petition, EDA will:
    (1) Make a determination based on the Record as soon as possible 
after the petitioning Firm or TAAC has submitted all requested 
material. In no event may the determination period exceed 40 calendar 
days from the date on which EDA accepted the petition; and
    (2) Either certify the petitioner as eligible to apply for 
Adjustment Assistance or deny the petition. In either event, EDA shall 
promptly give written notice of action to the petitioner. Any written 
notice to the petitioner of a denial of a petition shall specify the 
reason(s) for the denial. A petitioner shall not be entitled to 
resubmit a petition within one year from the date of denial unless EDA 
waives the one-year limitation for good cause.


Sec.  315.8   Hearings.

    EDA will hold a public hearing on an accepted petition if the 
petitioner or any interested Person found by EDA to have a Substantial 
Interest in the proceedings submits a request for a hearing no later 
than 10 calendar days after the date of publication of the notice of 
acceptance in the Federal Register, under the following procedures:
    (a) The petitioner or any interested Person(s) shall have an 
opportunity to be present, to produce evidence and to be heard.
    (b) A request for public hearing must be delivered by hand or by 
registered mail to EDA. A request by a Person other than the petitioner 
shall contain:
    (1) The name, address and telephone number of the Person requesting 
the hearing; and
    (2) A complete statement of the relationship of the Person 
requesting the hearing to the petitioner and the subject matter of the 
petition, and a statement of the nature of the requesting party's 
interest in the proceedings.
    (c) If EDA determines that the requesting party does not have a 
Substantial Interest in the proceedings, a written notice of denial 
shall be sent to the requesting party. The notice shall specify the 
reasons for the denial.
    (d) If EDA determines that the requesting party does have a 
Substantial Interest in the proceedings, EDA shall publish a notice of 
a public hearing in the Federal Register, containing the subject 
matter, name of petitioner, and date, time and place of the hearing.
    (e) EDA shall appoint a presiding officer for the hearing who shall 
respond to all procedural questions.


Sec.  315.9   Loss of Certification Benefits.

    EDA may terminate a Firm's certification or refuse to extend 
Adjustment Assistance to a Firm for any of the following reasons:
    (a) The Firm failed to submit an acceptable Adjustment Proposal 
within two years after date of certification. While approval of an 
Adjustment Proposal may occur after the expiration of such two-year 
period, a Firm must submit an acceptable Adjustment Proposal before 
such expiration.
    (b) The Firm failed to submit documentation necessary to start 
implementation or modify its request for Adjustment Assistance 
consistent with its Adjustment Proposal within six months after 
approval of the Adjustment Proposal, where two years have elapsed since 
the date of certification. If the Firm anticipates needing a longer 
period to submit documentation, it should indicate the longer period in 
its Adjustment Proposal. If the Firm is unable to submit its 
documentation within the allowed time, it should notify EDA in writing 
of the reasons for the delay and submit a new schedule. EDA has the 
discretion to accept or refuse a new schedule.
    (c) EDA has denied the Firm's request for Adjustment Assistance, 
the time period allowed for the submission of any documentation in 
support of such request has expired, and two years have elapsed since 
the date of certification.
    (d) The Firm failed to diligently pursue an approved Adjustment 
Proposal, and five years have elapsed since the date of certification.


Sec.  315.10   Appeals, Final Determinations and Termination of 
Certification.

    (a) Any petitioner may appeal in writing to EDA from a denial of 
certification, provided that EDA receives the appeal by personal 
delivery or by registered mail within 60 calendar days from the date of 
notice of denial under Sec.  315.7(g). The appeal must state the 
grounds on which the appeal is based, including a concise statement of 
the supporting facts and applicable law. The decision of EDA on the 
appeal shall be the final determination within the Department. In the 
absence of an appeal by the petitioner under this paragraph, the 
determination under Sec.  315.7(g) shall be final.
    (b) A Firm, its representative or any other interested domestic 
party aggrieved by a final determination under paragraph (a) of this 
section may, within 60 calendar days after notice of such 
determination, begin a civil action in the United States Court of 
International Trade for review of such determination, in accordance 
with section 284 of the Trade Act (19 U.S.C. 2395).
    (c) Whenever EDA determines that a Certified Firm no longer 
requires Adjustment Assistance or for other good cause, EDA will 
terminate the certification and promptly publish notice of such 
termination in the Federal Register. The termination will take effect 
on the date specified in the published notice. EDA shall immediately 
notify the petitioner and shall state the reasons for any termination.

Subpart D--Adjustment Proposals


Sec.  315.11   Adjustment Proposal Process.

    (a) Firms certified in accordance with the procedures described in 
Sec. Sec.  315.6 and 315.7 must prepare an Adjustment Proposal and 
submit it to EDA for approval within two years after the date of 
Certification.
    (b) EDA determines whether to approve the Adjustment Assistance 
requested in the Adjustment Proposal based upon the evaluation criteria 
set forth in Sec.  315.12 of this subpart. Upon approval, a Certified 
Firm may submit a request to the TAAC for Adjustment Assistance to 
implement an approved Adjustment Proposal. Firms must begin 
implementation within six months after approval. Firms that do not 
begin implementation within six months after approval must update, re-
submit their Adjustment Proposal, and request re-approval before any 
Adjustment Assistance may be provided.
    (c) EDA will make a determination regarding the Adjustment Proposal 
no later than 60 calendar days upon receipt of the Adjustment Proposal.
    (d) Adjustment Assistance is subject to the following matching 
share requirements:
    (1) Each Certified Firm must pay at least 25 percent of the cost of 
preparing its Adjustment Proposal. Each Certified Firm requesting 
$30,000 or less in total Adjustment Assistance in its approved 
Adjustment Proposal must pay at least 25 percent of the cost of that 
Adjustment Assistance. Each Certified Firm requesting more than $30,000 
in total Adjustment Assistance in its approved Adjustment Proposal must 
pay at least 50 percent of the cost of that Adjustment Assistance. 
Certified Firms may request no more than the amount as established by 
EDA for total Adjustment Assistance over the entire lifetime of the 
firm.
    (e) Firms may request EDA approval to amend their Adjustment Plans 
within two years from the date of EDA approval of their initial 
Adjustment Plan.
    (f) Firms must complete implementation of their Adjustment

[[Page 42842]]

Plans within five years of EDA approval of their initial Adjustment 
Plan.
    (g) If a Certified Firm is transferred, sold, or otherwise acquired 
by another Firm during the five-year period of Adjustment Assistance, 
the Firm must notify EDA no later than 30 calendar days following the 
transfer, sale, or acquisition. EDA will then make a determination as 
to whether the Firm remains eligible for Adjustment Assistance. EDA 
will make this determination no later than 60 calendar days following 
notification by the Firm.
    (h) In accordance with Section 255A of chapter 3 of title II of the 
Trade Act (19 U.S.C. 2345a), Firms that receive Adjustment Assistance 
must provide data regarding the Firms' sales, employment, and 
productivity upon completion of the program and each year for the two-
year period following completion.


Sec.  315.12   Adjustment Proposal Requirements.

    EDA evaluates Adjustment Proposals based on the following:
    (a) The Adjustment Proposal must include a description of any 
Adjustment Assistance requested to implement such proposal, including 
financial and other supporting documentation as EDA determines is 
necessary, based upon either:
    (1) An analysis of the Firm's problems, strengths and weaknesses 
and an assessment of its prospects for recovery; or
    (2) If EDA so determines, other available information;
    (b) The Adjustment Proposal must:
    (1) Be reasonably calculated to contribute materially to the 
economic adjustment of the Firm (i.e., that such proposal will 
constructively assist the Firm to establish a competitive position in 
the same or a different industry);
    (2) Give adequate consideration to the interests of a sufficient 
number of separated workers of the Firm, by providing, for example, 
that the Firm will:
    (i) Give a rehiring preference to such workers;
    (ii) Make efforts to find new work for a number of such workers; 
and
    (iii) Assist such workers in obtaining benefits under available 
programs; and
    (3) Demonstrate that the Firm will make all reasonable efforts to 
use its own resources for its recovery, though under certain 
circumstances, resources of related Firms or major stockholders will 
also be considered; and
    (c) The Adjustment Assistance identified in the Adjustment Proposal 
must consist of specialized consulting services designed to assist the 
Firm in becoming more competitive in the global marketplace. For this 
purpose, Adjustment Assistance generally consists of knowledge-based 
services such as market penetration studies, customized business 
improvements, and designs for new products. Adjustment Assistance does 
not include expenditures for capital improvements or for the purchase 
of business machinery or supplies.

Subpart E--Protective Provisions


Sec.  315.13   Persons Engaged by Firms to Expedite Petitions and 
Adjustment Proposals.

    EDA will provide no Adjustment Assistance to any Firm unless the 
owners, partners, members, directors or officers thereof certify in 
writing to EDA:
    (a) The names of any attorneys, agents, and other Persons engaged 
by or on behalf of the Firm for the purpose of expediting Petitions for 
such Adjustment Assistance or Adjustment Proposals; and
    (b) The fees paid or to be paid to any such Person.


Sec.  315.14   Conflicts of Interest.

    EDA will provide no Adjustment Assistance to any Firm under this 
part unless the owners, partners, members, directors or officers 
thereof execute an agreement binding them and the Firm for a period of 
two years after such Adjustment Assistance is provided, to refrain from 
employing, tendering any office or employment to, or retaining for 
professional services any Person who, on the date such assistance or 
any part thereof was provided, or within one year prior thereto, shall 
have served as an officer, attorney, agent, or employee occupying a 
position or engaging in activities which involved discretion with 
respect to the provision of such Adjustment Assistance.

Subpart F--International Trade Commission Investigations


Sec.  315.15   Affirmative Findings.

    Whenever the International Trade Commission makes an affirmative 
finding under section 202(b) of the Trade Act (19 U.S.C. 2252) that 
increased imports are a substantial cause of serious injury or threat 
thereof with respect to an industry or under sections 705 or 735 of the 
Tariff Act (19 U.S.C. 1671d, 1673d), EDA will notify the TAACs and 
provide expedited review of petitions and Adjustment Plans from Firms 
within the specified industry.

    Dated: August 12, 2019.
John Fleming,
Assistant Secretary of Commerce for Economic Development.
[FR Doc. 2019-17710 Filed 8-16-19; 8:45 am]
 BILLING CODE 3510-24-P