AGENCY:
Maritime Administration, DOT.
ACTION:
Interim final rule.
SUMMARY:
The Maritime Administration (MARAD, or we, our or us) is publishing this interim final rule to implement the changes of the Maritime Transportation Security Act of 2002. This interim final rule implements regulations to waive the U.S.-build requirements of the Passenger Vessel Services Act and section 27 of the Merchant Marine Act, 1920, for eligible vessels to be documented with appropriate endorsement for employment in the coastwise trade as small passenger vessels or uninspected passenger vessels authorized to carry no more than 12 passengers for hire. This interim final rule also brings the application procedure into compliance with the Government Paperwork Elimination Act, which requires that by October 21, 2003, the government must provide “the option of electronic maintenance, submission, or disclosure of information when practicable as a substitute for paper.”
DATES:
The effective date of this interim final rule is April 30, 2003. Comments must be recieved by May 30, 2003.
ADDRESSES:
Comments should refer to docket number MARAD 2003-15030. Written comments may be submitted by mail to the Docket Clerk, U.S. Dot Dockets, Room PL-401, Department of Transportation, 400 7th St., SW., Washington, DC 20590-0001. You may also send comments electronically via the Internet at http://smses.dot.gov/submit/. All comments will become part of this docket and will be available for inspection and copying at the above address between 10 a.m. and 5 p.m., e.t., Monday through Friday, except Federal holidays. An electronic version of this document and all documents entered into this docket is available on the World Wide Web at http://dms.dot.gov.
FOR FURTHER INFORMATION CONTACT:
You may call Michael Hokana, Office of Ports and Domestic Shipping, Maritime Administration, at (202) 366-0760, or you may write to him at the following address: MAR-830 Room 7201, 400 Seventh Street, SW., Washington, DC 20590.
SUPPLEMENTARY INFORMATION:
Public Law 105-383, which authorized the Secretary of Transportation to grant waivers of certain requirements for the smallest of passenger vessels (those carrying 12 or fewer passengers) to operate in the coastwise trade, contained a sunset provision effective September 30, 2002. The Maritime Transportation Security Act of 2002, section 207(c), Pub. L. 107-295 (the Act), removed the sunset provision and added anti-fraud revocation authority.
Between January 2000 and September 2002, MARAD utilized regulations published at 46 CFR part 388 to accept applications from the public and provide public notice of the intent to issue waivers to foreign built vessels for use in the coastwise passenger trade (see Federal Register notice at 65 FR 6905) (February 11, 2001). However, the regulation also contains the sunset included in the enabling legislation. The application process required a $300 non-refundable fee, an “adverse effect” assessment on the U.S.-flag shipping and vessel building community, and a requirement that the vessel meet U.S. Coast Guard documentation standards. Waivers approved by MARAD, which set limits on vessel's geographic use and required that all significant changes be conducted with MARAD's prior approval, became a permanent part of the vessel's coastwise endorsement. As required by the original enabling legislation and the implementing regulation, MARAD granted no waivers after September 30, 2002.
The Act signed by President Bush on November 25, 2002, repealed the September 30, 2002, sunset provision contained in section 505 of the Coast Guard Authorization Act of 1998 (Pub. L. 105-383). The Act also substitutes a new section 503 which requires the Secretary to revoke “a certificate or an endorsement issued under section 502, after notice and opportunity for a hearing, if the Secretary determines that the certificate or endorsement was obtained by fraud.” This section changes and supersedes the circumstances under which a waiver can be revoked. This interim final rule implements these two legislative changes.
This interim final rule also makes several administrative changes designed to simplify the application process. Under the simplified process, applicants are encouraged to apply on line. The application will be available on the MARAD Web site at http://www.marad.dot.gov and will include the ability to charge the application fee to a major credit card.
Program Description: There are two agencies with responsibilities related to the coastwise trade laws. The Coast Guard, part of the Department of Transportation before moving to the Department of Homeland Security, issues the vessel documents and endorsements that authorize vessels to engage in the coastwise trade. However, the Secretary of Transportation has delegated to MARAD the authority to process applications for waivers of the coastwise laws and to grant such waivers if they do not adversely affect United States vessel builders or United States-built vessel coastwise trade businesses. We are outlining the procedures to be followed in processing applications for waivers, or revoking waivers previously granted. Upon grant of a waiver, MARAD will notify the applicant and the Coast Guard. Thereafter, you may register the vessel so waived with the Coast Guard under the Coast Guard's normal procedures, provided the vessel is otherwise eligible.
Vessels eligible for a waiver of the coastwise trade laws will be limited to foreign-built or foreign rebuilt small passenger vessels and uninspected passenger vessels as defined by section 2101 of title 46, United States Code. Vessels of unknown origin will be considered foreign built. Additionally, vessels requested for consideration must be greater than three (3) years old. We will not grant waivers in instances where such waiver activity will have an unduly harmful impact on U.S. shipyards or U.S.-flag ship operators. Specifically, and in order to meet the public comment provisions of title V, it is our intention to give notice of applications in the Federal Register and provide the appropriate reference to the DOT Docket where the application is published and comments may be submitted. After a period of time to evaluate comments and assess the impact that the proposed waivers will have on the U.S.-flag shipping and shipbuilding industry, we will issue a determination.
MARAD does not have the authority to waive citizenship requirements for vessel ownership and documentation. The Coast Guard will ascertain whether the shipowner is qualified as a citizen to register a vessel. In addition, the Coast Guard, not MARAD, will determine whether a particular vessel will be considered a small passenger vessel or an uninspected passenger vessel. However, we may refuse to process an application if the vessel is not the type eligible for a waiver. Prospective applicants for a coastwise trade law waiver may wish to consult with the Coast Guard prior to initiating the waiver application process with MARAD.
Under title V, section 503 previously contained authority to revoke coastwise endorsements under the limited circumstances where a foreign-built or foreign-rebuilt passenger vessel, that had been allowed into service, substantially changed that service. The Act amended section 503 to provide fraud in the application process as the basis to revoke an endorsement. MARAD's procedure for revocation of a waiver will not change significantly. Procedures will still include the publication of a notice in the Federal Register seeking public comments on the proposed revocation. A hearing may be provided prior to making determination. Secondly, if we determine that the endorsement was obtained by fraud we will issue a formal letter of waiver revocation with an appropriate grace period. This determination will be sent to the Coast Guard for revocation of the vessel's coastwise endorsement.
MARAD's decisions to grant or deny a waiver and to revoke or not revoke a waiver will not be final until the time for review has expired. Applicants and persons who submitted comments in response to a Federal Register notice may petition the Maritime Administrator to review a waiver determination, or request the Maritime Administrator not to review a waiver determination. Relatively short time periods are provided for this review process.
Rulemaking Analyses and Notices
Executive Order 12866 and DOT Regulatory Policies and Procedures
This interim final rule is not significant under section 3(f) of Executive Order 12866, and as a consequence, OMB did not review the rule. This interim final rule is not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034; February 26, 1979). The costs and benefits associated with this rulemaking are considered to be so minimal that no further regulatory impact analysis is necessary. Vessels eligible for a waiver of the coastwise trade laws will be limited to foreign built or foreign re-built small passenger vessels and uninspected passenger vessels as defined by section 2101 of title 46, United States Code. Additionally, vessels requested for consideration must be greater than three years old. We will not grant waivers in instances where such waiver activity will have an unduly adverse effect on U.S. vessel builders or U.S. businesses that use U.S. flag vessels. Under title V, MARAD also has the authority to revoke coastwise endorsements under the limited circumstances where a foreign-built or foreign-rebuilt passenger vessel, previously allowed into service, is deemed to have obtained such endorsement through fraud.
We are publishing this rule as an interim final rule, pursuant to 5 U.S.C. 553 (b)(3)(B), rather than as a proposed rule, because notice and public procedure thereon are unnecessary. Part 388 was originally published following proper notice and comment procedures. The Act lifts the sunset provision in the statute, thereby extending the program indefinitely. This interim final rule likewise lifts the sunset provision that was contained in the regulation. The change in revocation criteria included in the interim final rule is mandated by legislation. The other change effected immediately by this interim final rule, the option of filing applications electronically, is mandated by the Government Paperwork Elimination Act.
Executive Order 13132
We analyzed this rulemaking in accordance with the principles and criteria contained in E.O. 13132 (“Federalism”) and have determined that it does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement. The regulations herein have no substantial effects on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. Therefore, MARAD did not consult with State and local officials because it was not necessary.
Regulatory Flexibility Act
The Regulatory Flexibility Act requires MARAD to assess the impact that regulations will have on small entities. After analysis of this interim final rule, MARAD certifies that this interim final rule will not have a significant economic impact on a substantial number of small businesses. Although we expect many applicants for vessel waivers to be small businesses, we do not believe that the economic impact will be significant. This regulation allows MARAD to waive the U.S.-build and other requirements for eligible vessels and adds a small economic benefit to applicants. This regulation will only allow vessels to carry the statutory maximum of 12 passengers. As a consequence, MARAD estimates that a vessel owner who receives a waiver may earn a few hundred dollars per year for localized operations (geographic restrictions apply) such as whale watching and personalized fishing expeditions. Also, the economic impact of this rule is limited because it precludes vessel owners from participating in other economic activities such as carrying cargo and commercial fishing.
Environmental Assessment
This interim rule would not significantly affect the environment because the small number and small size of vessels admitted to U.S. registry under this waiver program would have little or no effect on the environment. Accordingly, an Environmental Impact Statement is not required under the National Environmental Policy Act of 1969.
Paperwork Reduction Act
This interim final rule reactivates a requirement for the collection of information that was used before the sunset provision contained in the Coast Guard Authorization Act of 1998 ended the authority to grant waivers. The Office of Management and Budget (OMB) has reviewed and approved the information collection requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.). The OMB approval number is 2133-0529.
Unfunded Mandates Reform Act
This interim final rule does not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It does not result in costs of $100 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objectives of the rule.
Consultation and Coordination With Indian Tribal Governments
MARAD believes that regulations evolving from this interim final rule would have no significant or unique effect on the communities of Indian tribal governments when analyzed under the principles and criteria contained in Executive Order 13084 (Consultation and Coordination with Indian Tribal Governments). Therefore, the funding and consultation requirements of this Executive Order would not apply.
Regulation Identifier Number (RIN)
A regulation identifier number (RIN) is assigned 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. The RIN number contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.
List of Subjects in 46 CFR Part 388
- Administrative practice and procedure
- Maritime carriers
- Passenger vessels
- Reporting and recordkeeping requirements
Accordingly, the Maritime Administration amends 46 CFR chapter II, subchapter J, by revising part 388 to read as follows:
PART 388—ADMINISTRATIVE WAIVERS OF THE COASTWISE TRADE LAWS
388.1Authority: 46 App. U.S.C. 1114(b); Pub. L. 105-383, 112 Stat. 3445 (46 U.S.C. 12106 note): 49 CFR 1.66.
This part prescribes regulations implementing the provisions of Title V of Public Law 105-383 (112 Stat. 3445), which grants the Secretary authority to review and approve applications for waiver of the coastwise trade laws to allow the carriage of no more than twelve passengers for hire on vessels, which are three years old or more, built or rebuilt outside the United States, and grants authority for revocation of those waivers.
For the purposes of this Part:
(a) Administrator means the Maritime Administrator
(b) Coastwise Trade Laws include:
(1) The Coastwise Endorsement Provision of the Vessel Documentation Laws, (46 U.S.C. 12106);
(2) The Passenger Services Act, section 8 of the Act of June 19, 1886 (46 App. U.S.C. 289); and
(3) The Jones Act, section 27 of the Merchant Marine Act, 1920 (46 App. U.S.C. 883).
(c) Eligible vessel means a vessel of five or more tons that is either a small passenger vessel or an uninspected passenger vessel that—
(1) Was not built in the United States and is at least 3 years of age; or
(2) If rebuilt, was rebuilt outside the United States at least 3 years before the certificate of documentation with appropriate endorsement if granted, would become effective.
(d) MARAD means the Maritime Administration, U.S. Department of Transportation.
(e) Secretary means the Secretary of Transportation.
(f) The terms, small passenger vessel, uninspected passenger vessel and passenger for hire have the meaning given such terms by section 2101 of title 46, United States Code.
(g) Fraud means the intentional misrepresentation of a material fact or facts.
(a) An owner of a vessel may choose either of two methods to apply for an administrative waiver of the coastwise trade laws of the United States for an eligible vessel to carry no more than twelve passengers for hire.
(1) The application form contained on MARAD's Web site at http://www.marad.dot.gov may be submitted electronically with credit card or Automated Clearinghouse (ACH) payment of the $300 application fee.
(2) Alternatively, applicants may send written applications to Small Vessel Waiver Applications, Office of Ports and Domestic Shipping, MAR-830, Room 7201, 400 7th St., SW., Washington, DC 20590. Written applications need not be in any particular format, but must be signed, be accompanied by a check for $300 made out to the order of “Maritime Administration”, and contain the following information:
(i) Name of vessel and owner for which waiver is requested and the vessel's official number.
(ii) Size, capacity and tonnage of vessel (state whether tonnage is measured pursuant to 46 U.S.C. 14502, or otherwise, and if otherwise, how measured).
(iii) Intended use for vessel, including geographic region of intended operation and trade.
(iv) Date and place of construction and (if applicable) rebuilding. (If applicant is unable to document the origin of the vessel, foreign construction will be assumed).
(v) Name, address, and telephone number of the vessel owner.
(vi) A statement on the impact this waiver will have on other commercial passenger vessel operators, including a statement describing the operations of existing operators.
(vii) A statement on the impact this waiver will have on U.S. shipyards.
(viii) A statement that the applicant represents that the foregoing information is true to the best of the applicant's knowledge.
(b) MARAD may ask additional questions of the applicant as part of the application review.
(a) General criteria. (1) A waiver of the foreign build and/or foreign rebuild prohibition in the coastwise trade laws will be granted for an eligible vessel only if we determine that the employment of the vessel in the coastwise trade will not unduly adversely affect—
(i) United States vessel builders; or
(ii) The coastwise trade business of any person who employs vessels built in the United States in that business.
(2) The determination of “unduly adverse affect” on a coastwise operator or a U.S. vessel builder may not be limited to operators or builders of vessels carrying 12 or fewer passengers.
(3) We may evaluate the expected impact of the proposed waiver on the basis of the information received from all sources, including public comment, internal investigation and analysis, and any other sources of information deemed appropriate.
(b) Impact on U.S. vessel builders. We may use the following criteria to determine the effect on U.S. vessel builders: Whether a potentially impacted U.S. vessel builder has a history of construction of similar vessels, or can demonstrate the capability and capacity and the fact it has taken definite steps to offer to build a similar vessel, for use in the same geographic region of the United States, as the proposed vessel of the applicant.
(c) Impact on coastwise trade business. We may use the following criteria to determine the effect on existing operators of U.S.-built vessels in coastwise trade:
(1) Whether the proposed vessel of the applicant and a vessel of an existing operator (or the vessel of an operator that can demonstrate it has taken definite steps to begin operation) would provide similar commercial service and would operate in the same geographic area.
(2) The number of similar vessels operating or proposed to operate in the same market with the same or similar itinerary, relative to the size of the market. For example, a single vessel may have a small impact on a large market.
(d) Advance notice and approval needed for changes. When we approve a waiver application, we will notify the applicant that no substantial change in the employment of the vessel in the coastwise trade may be made without prior notice to MARAD. In general a substantial change in operating area will require a new waiver application.
We may revoke a waiver previously granted under this Part if we determine, after notice and opportunity for a hearing, that fraud was involved in any part of the waiver application.
(a) Initial process. (1) We will review each application for completeness as received. We will notify the applicant if additional information is necessary or if the application does not meet the initial eligibility requirements for waiver. All applications will be available for public inspection electronically in the Department of Transportation Docket at http://dot.dms.gov.
(2) Applications being processed on the merits will be noticed in the Federal Register. Interested parties will be given an opportunity to comment on whether introduction of any proposed vessel would adversely affect them. In the absence of duly filed objections to an application, and in the absence of unduly adverse impact on vessel builders or businesses employing U.S.-built vessels otherwise discovered by us, we will conclude that there will be no adverse effect. If an objection to an application is received, additional information may be sought from the objector. The applicant will be given a sufficient amount of time to respond. The Director, Office of Ports and Domestic Shipping, will then either make a decision based on the written submissions and all available information or may as a matter of discretion, hold a hearing on the application and make a decision based on the hearing record. The decision will be communicated to the applicant, commenters and the United States Coast Guard in writing and placed in the docket. If MARAD grants a waiver, the applicant must thereafter contact the Coast Guard to obtain the necessary documentation for domestic operation. MARAD's waiver does not satisfy other requirements of the Coast Guard for documentation. The waiver, if approved, will be assigned to the vessel.
(b) Revocation. We may, upon the request of a U.S. builder or a coastwise trade business of a person who employs U.S. built vessels or upon our own initiative propose to revoke a waiver granted under this part, on the basis that the waiver was obtained through fraud. The grantee of the waiver in question will be notified directly by mail, and a notice will be published in the Federal Register. The original docket of the application will be reopened. We may request additional information from the applicant granted the waiver or from any respondent to the notice. The Director, Office of Ports and Domestic Shipping, will then either make a decision based on the written submissions and all available information or, as a matter of discretion hold a hearing on the proposed revocation and make a decision based on the hearing record. The decision will be communicated in writing to: the applicant granted the waiver, the requestor (if any), each respondent to the proposed revocation notice, the Coast Guard; and placed in the docket. If MARAD revokes a waiver, the Coast Guard, automatically and without further proceedings, shall revoke the vessel's coastwise endorsement.
(c) Review of determinations. (1) The decisions by the Director, Office of Ports and Domestic Shipping, to grant a waiver, deny a waiver, or revoke a waiver will not be final until time for discretionary review by the Administrator has expired. Each decision to grant, deny, or revoke a waiver will be made in writing and a copy of the written decision will be provided to each applicant and other parties to the decision. Applicants, persons who requested revocation of a waiver, and persons who submitted comments in response to a Federal Register notice may petition the Administrator to review a decision by the Director, Office of Ports and Domestic Shipping to grant a waiver, deny a waiver, or revoke a waiver within five (5) business days after such decision is filed in the docket. Each petition for review should state the petitioner's standing and the reasons review is being sought, clearly pointing out alleged errors of fact or misapplied points of law. Within five (5) business days of submission of a petition for review, the applicant, and other persons with standing, may request the Administrator not review a waiver, waiver denial or waiver revocation decision.
(2) Such petitions and responses must either be sent by facsimile to the Secretary, Maritime Administration, at (202) 366-9206 or filed electronically in the appropriate DOT docket at http://dms.dot.gov. The Administrator will decide whether to review within five (5) business days following the last day for submission of a request that the Administrator not take review. If the Administrator takes review, the decision by the Director, Office of Ports and Domestic Shipping, is stayed until final disposition. In the event the Administrator decides to take review, a decision will be made based on the written submissions and all available information. As a matter of discretion, the Administrator or designated representative may hold a hearing on the proposed action and make a decision based on the hearing record. The decision will be communicated in writing to the interested parties and the Coast Guard. In the review process, the decision of the Maritime Administrator is the final disposition. In the absence of any petition for review, the determination by the Director, Office of Ports and Domestic Shipping becomes final on the sixth business day after the decision. The Secretary, MARAD, may extend any of the time limits, but only for good cause shown.
Dated: April 24, 2003.
By Order of the Maritime Administrator.
Joel C. Richard,
Secretary.
[FR Doc. 03-10578 Filed 4-29-03; 8:45 am]
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