81 FR 55115 - Reciprocal Waivers of Claims for Licensed or Permitted Launch and Reentry Activities
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration Federal Register Volume 81, Issue 160 (August 18, 2016)
Federal Aviation Administration
Federal Register Volume 81, Issue 160 (August 18, 2016)
| Page Range | 55115-55133 | |
| FR Document | 2016-18765 |
[Federal Register Volume 81, Number 160 (Thursday, August 18, 2016)] [Rules and Regulations] [Pages 55115-55133] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-18765] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 440 [Docket No.: FAA-2014-1012; Amdt. No. 440-4] RIN 2120-AK44 Reciprocal Waivers of Claims for Licensed or Permitted Launch and Reentry Activities AGENCY: Federal Aviation Administration (FAA), DOT. ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: The FAA is amending its commercial space regulations governing reciprocal waivers of claims to require that customers waive claims against all the customers involved in a launch or reentry, including those signing a different set of reciprocal waivers. Also, customers of a customer contracting directly with a licensee or permittee will not have to sign a waiver directly with the licensee or permittee, other customers, or the FAA. The FAA is also adding an appendix to provide permittees with an example of a Waiver of Claims and Assumption of Responsibility for Permitted Activities with No Customer. [[Page 55116]] DATES: Effective October 17, 2016. ADDRESSES: For information on where to obtain copies of rulemaking documents and other information related to this final rule, see ``How To Obtain Additional Information'' in the SUPPLEMENTARY INFORMATION section of this document. FOR FURTHER INFORMATION CONTACT: For questions concerning this rule, contact Shirley McBride, Regulations Program Lead, AST-300, Office of Commercial Space Transportation, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267- 7470; email [email protected]. SUPPLEMENTARY INFORMATION: Authority for This Rulemaking The Commercial Space Launch Act of 1984, as amended at 51 U.S.C. 50901-50923 (Chapter 509), authorizes the Department of Transportation and thus the FAA, through delegations, to oversee, license, and regulate commercial launch and reentry activities, and the operation of launch and reentry sites as carried out by U.S. citizens or within the United States. 51 U.S.C. 50904, 50905. The Act directs the FAA to exercise this responsibility consistent with public health and safety, safety of property, and the national security and foreign policy interests of the United States. 51 U.S.C. 50905. Section 50901(a)(7) directs the FAA to regulate only to the extent necessary, in relevant part, to protect the public health and safety and safety of property. The FAA is also responsible for encouraging, facilitating, and promoting commercial space launches by the private sector. 51 U.S.C. 50903. Chapter 509 requires that, for each commercial space launch or reentry, the Department of Transportation (DOT) and, through delegation, the Federal Aviation Administration (FAA) enter into a reciprocal waiver of claims agreement with ``the licensee or transferee, contractors, subcontractors, crew, space flight participants, and customers of the licensee or transferee, and contractors and subcontractors of the customers. . . .'' 51 U.S.C. 50914(b)(2). This requirement also applies to permittees under 51 U.S.C. 50906(i). I. Overview of Final Rule This rule revises part 440 in the following ways: (1) Amends Sec. 440.17 to describe fully the reciprocal waiver of claims requirements applicable to the relevant appendices; (2) amends Sec. 440.17 and updates appendices B and C so that customers of any customer contracting directly with a licensee or permittee do not have to sign a waiver directly with the licensee or permittee, other customers, or the FAA; (3) amends Sec. 440.17 and updates appendices B and C of part 440 so that customers waive claims, as required by statute, against all the customers involved in the launch or reentry, including those signing a different set of reciprocal waivers; (4) amends Sec. 440.3 to add a definition of ``first-tier customer'' and ``part 440 customer''; and (5) adds an appendix to provide licensees with an example of a Waiver of Claims and Assumption of Responsibility for Permitted Activities with No Customer. These changes will result in cost savings to the licensee, government and customers, and minimal cost to any customer in a direct contractual relationship with the licensee or permittee if it has customers to the launch. This rule does not address changes to the reciprocal waiver of claims created by the U.S. Commercial Space Launch Competitiveness Act, P.L. 114-90 (2015). Those changes will be addressed by a future rulemaking. II. Background On January 13, 2015, the FAA published a notice of proposed rulemaking (NPRM), ``Reciprocal Waivers of Claims for Licensed or Permitted Launch and Reentry Activities,'' 80 FR 1590, proposing to amend the FAA's regulations regarding reciprocal waivers of claims agreements. The NPRM also discussed the potential burden the reciprocal waivers of claims requirements may impose on licensees and permittees launching hosted payloads. The comment period closed on March 16, 2015. On June 15, 2015, the FAA reopened the comment period for 30 days because the regulatory evaluation was not posted to the docket prior to the close of the NPRM's comment period. This second comment period was limited to comments on the regulatory evaluation only, and closed on July 15, 2015. The FAA received five comments on the NPRM and no comments on the regulatory evaluation. III. Discussion of Final Rule and Public Comments The FAA received comments from five entities, including launch operators, service providers, and one individual. Launch operators who provided comments are Blue Origin, LLC (Blue Origin), Lockheed Martin Corporation (Lockheed), and Space Exploration Technologies Corporation (SpaceX). Harris Corporation (Harris) and an individual also commented. In general, the commenters supported the proposed requirements. A few commenters suggested changes to the proposed regulatory text in order to achieve the FAA's proposed outcome. After careful consideration of the comments, the FAA generally adopts the provisions as proposed, but makes the following changes. The FAA amends Sec. 440.17(b) and (c) and part 440, appendices B and C, to include part 440 customers and their contractors and subcontractors in the reciprocal waiver of claims scheme. The FAA adds Sec. 440.17(c)(1)(iii)(D) to preserve the statutory and regulatory requirements that all customers waive claims against all the other parties involved in the licensed permitted activity. Lastly, the FAA removes permittees from the indemnification scheme reserved by statute for licensees only, thereby maintaining the scope of the indemnification scheme as set out in 51 U.S.C. 50915. A. First-Tier and Part 440 Customers As originally proposed, Sec. 440.17(c) is amended to require the FAA, the licensee or permittee, and each first-tier customer to enter into a reciprocal waiver of claims agreement for each licensed or permitted activity in which the U.S. Government, any agency, or its contractors and subcontractors are involved, or where property insurance is required under Sec. 440.9(d). Additionally, as proposed, Sec. 440.3 is amended to define the terms ``first-tier customer'' and ``part 440 customer.'' A first-tier customer is one who satisfies the definition of a customer and has a contractual relationship with a license or permit holder to obtain launch or reentry services. A part 440 customer means one who satisfies the regulatory definition of a customer and who is not a first-tier customer. Blue Origin requested that the FAA clarify how a licensee or permittee should identify its customers under the proposed rule. The FAA adopts these provisions as proposed, and provides further clarification below. Blue Origin requested clarification on how the requirement to enter into a reciprocal waiver of claims agreement with each first-tier customer would apply to a situation in which a first-tier customer was a single entity representing a group of persons. Blue Origin stated that it ``interprets the proposal to require that only the single entity representing the group will be required to sign a reciprocal waiver with the licensee/permittee and FAA.'' \1\ Blue Origin also requested that the FAA [[Page 55117]] confirm that ``if a first-tier customer is a single entity representing a group of persons, the licensee/permittee is required to enter into a cross waiver of claims only with a representative of the group as the first-tier customer.'' \2\ --------------------------------------------------------------------------- \1\ Blue Origin Comment at 2. \2\ Blue Origin Comment at 2. --------------------------------------------------------------------------- An entity's status as the representative of a group is not the determining factor as to whether or not that entity is required to sign a reciprocal waiver with the licensee or permittee and the FAA. Rather, a licensee or permittee is only required to enter into a reciprocal waiver with customers with whom it is in a contractual relationship. To determine the entities with which it must execute a reciprocal waiver, the licensee or permittee should determine what entities it has contracted with for the licensed or permitted activity who also qualify as customers under 14 CFR 440.3. Accordingly, if a licensee entered into a contract with a number of entities for launch or reentry services, it would enter into reciprocal waivers with each of them. Blue Origin provided a hypothetical scenario in which a school, university research lab, or other educational institution represented a group of students that contributed to the development of a payload. In this hypothetical situation, the single entity representing the group may be the only entity required to sign a reciprocal waiver with the licensee or permittee and the FAA. However, the hypothetical entity would be the only entity required to sign the reciprocal waiver only if it was the only entity in a contractual relationship with the licensee or permittee, and therefore the only entity who would qualify as a first-tier customer.\3\ In that case, the representative would be the only first-tier customer and, therefore, the only party required to sign the reciprocal waiver of claims with the licensee or permittee and the FAA. If, however, any other member of the group was also in a direct contractual relationship with the licensee or permittee and also met the FAA's definition of customer under Sec. 440.3, that member would also be a first-tier customer and would also be required to sign a reciprocal waiver of claims with the licensee or permittee and the FAA. It would not, however, have to sign with all other first-tier customers because this final rule ensures that customers waive claims against all other customers involved in a launch or reentry, including those signing different reciprocal waivers. --------------------------------------------------------------------------- \3\ The FAA assumes for purposes of this hypothetical that the entity representing the group meets the FAA's definition of customer in 14 CFR 440.3, by, for example, being the one who procures the launch. --------------------------------------------------------------------------- Blue Origin also expressed concern regarding how a licensee or permittee will determine who its customers are. Specifically, Blue Origin pointed out that determining whether each party has an interest in the payload is complicated by the fact that ``people have varying levels of involvement (e.g., a student works an entire semester on a project, vs. one who works a few hours), or have left the group (e.g., some students graduate prior to completion of a payload, and are replaced by other students).'' \4\ --------------------------------------------------------------------------- \4\ Blue Origin Comment at 2. --------------------------------------------------------------------------- The FAA is not changing the definition of ``customer'' under Sec. 440.3 in this rulemaking. However, the burden of identifying part 440 customers does shift with this rule, not to the licensee or permittee as Blue Origin suggests, but to the appropriate first-tier customer. This is because under this rule a licensee or permittee is responsible for implementing a reciprocal waiver of claims only with those customers with whom it is in a direct contractual relationship. A first-tier customer, as a result of this rule, will be responsible for implementing a reciprocal waiver of claims with each of its customers. Although it is not changing the definition of customer under Sec. 440.3, the FAA reiterates what it has said about the definition of customer in previous rulemakings. In its 1996 rulemaking, the FAA pointed out that it construes the term customer in proposed Sec. 440.3 more broadly than just ``the party that actually contracts with the commercial launch services provider and prospective licensee.'' \5\ The 1996 NPRM provided the example of a customer who had placed its property on board the payload in order to receive an on-orbit service, such as microgravity experiments, and stated that such an entity would be considered a customer to the launch even though it did not procure the launch.\6\ In the final rule that resulted from the 1996 NPRM, the FAA stated: ``The definition of `customer' is further modified in the final rule to include any person who places property on board a payload for the purpose of obtaining launch or payload services . . . .'' \7\ --------------------------------------------------------------------------- \5\ Financial Responsibility Requirements for Licensed Launch Activities, NPRM, 61 FR 38992, 39002 (July 25, 1996). \6\ Financial Responsibility, 61 FR at 39002. \7\ Financial Responsibility Requirements for Licensed Launch Activities, Final Rule, 63 FR 45592, 45607 (August 26, 1998). --------------------------------------------------------------------------- The FAA's definition of customer, therefore, as applied to Blue Origin's hypothetical, would be based on ownership rights in the payload rather than the level of involvement in developing the payload. For example, a person may build a payload and sell it to a company. The company may then place that payload on board a rocket. The builder has no ownership rights in the payload, and therefore would not be a customer under Sec. 440.3. The company who purchased, and therefore owns the payload, would be a customer under Sec. 440.3. The person facing financial exposure for failing to properly identify these other non-signing customers would be the first-tier customer. B. Government Customers A Government customer need not sign a reciprocal waiver of claims because the FAA signs the reciprocal waiver of claims on behalf of the Government. Although, the proposed rule did not mention Government customers, Harris Corporation requested clarification on the treatment of Government-hosted payload customers on commercial payloads launched pursuant to Chapter 509. The FAA makes no change based on this comment. Specifically, Harris asked whether the FAA would sign the waiver form on behalf of a Government customer, whether a Government customer could be considered a part 440 customer, and whether a Government customer's contractor would be considered a contractor of the United States for purposes of Sec. 440.14(c). As the agency has stated in previous rulemakings, ``[w]hen the licensee's customer is a U.S. Government agency, the agency is treated the same as any nongovernmental customer for purposes of determining the appropriate amount of property insurance required of the licensee and in terms of the U.S. Government's waiver of claims or property damage or less above the required amount of property insurance under [51 U.S.C. 50914(b)(2)]. That is, a Government payload is not covered by the required Government property insurance and the United States Government agency-customer accepts responsibility for property damage to the payload.'' \8\ --------------------------------------------------------------------------- \8\ Financial Responsibility, 61 FR at 39001. --------------------------------------------------------------------------- Because the FAA signs on behalf of the U.S. Government, any Government customer would not separately sign any reciprocal waiver of claims. The designation as a part 440 customer does not change a customer's responsibilities under the reciprocal waivers of claims, it only affects with whom the customer must sign a reciprocal waiver of claims. A Government customer's status as a first-tier or part 440 customer does not [[Page 55118]] matter, because the FAA signs on behalf of the Government. As to Harris' last question concerning whether a contractor of a Government customer would be considered a contractor of the United States for purposes of Sec. 440.14(c), it is beyond the scope of the current rulemaking. Additionally, the FAA notes that Sec. 440.14(c) is not currently a regulatory provision. C. Extension of the Reciprocal Waivers of Claims Requirements The FAA intended to amend only the method by which the obligations under the reciprocal waiver of claims were extended. Rather than requiring the licensee or permittee to implement the reciprocal waiver of claims with its contractors, subcontractors, customers, and customers' contractors and subcontractors, this rule requires that each customer extend the reciprocal waiver of claims to its contractors and subcontractors. Although it did not receive comment on the issue, the FAA adds the extension of the reciprocal waiver of claims requirements to Sec. 440.17(b) to require the licensee or permittee, each first- tier customer, and each part 440 customer to extend the requirements to their respective contractors and subcontractors. Therefore, and as discussed below, a part 440 customer must waive and release claims, assume responsibility, hold harmless, and indemnify other parties identified in the waiver as a result of both the explicit requirement in Sec. 440.17(c)(1)(iii)(D) and the extension of the reciprocal waiver of claims requirements in Sec. 440.17(c)(2) and (c)(1)(iii). Additionally, the FAA adds language to Sec. 440.17(c)(2)(i), (ii), and (iii), and the associated part 440 appendices specifying that a party to a reciprocal waiver of claims must agree in that waiver to indemnify another party to the agreement from claims by the indemnifying party's contractors, subcontractors, and in the case of the customer, customers, arising out of the indemnifying party's failure to correctly extend the reciprocal waiver of claims requirement. This change was contemplated by the proposed rule, and preserves the requirements of this section prior to the amendments included in this final rule. 1. Extension of Reciprocal Waiver of Claims to Part 440 Customers' Contractors and Subcontractors SpaceX commented that the proposed rule did not effectively extend the reciprocal waiver of claims requirements to a part 440 customer's contractors and subcontractors such that those contractors and subcontractors waived claims against all other parties otherwise protected by the reciprocal waiver of claims. SpaceX also commented that the appendices should be adjusted to state that a first-tier customer indemnifies the appropriate parties from and against liability, loss, or damage arising out of any claim brought by its customer's contractors and subcontractors. Harris commented that Sec. 440.17(b) should be revised to include part 440 customers and their contractors and subcontractors in the waiver scheme to ensure that the parties to the reciprocal waiver of claims waive claims against them. In this rule the FAA changes Sec. 440.17 to apply to part 440 customers' contractors and subcontractors, but does not adopt SpaceX's proposed language for the appendices. This marks a change from the regulatory text that the FAA originally proposed, based on comments discussed below. SpaceX recommended additions to proposed Sec. 440.17 and the associated appendices ``to ensure that the regulations maintain the current obligations of all customers' contractors and subcontractors with respect to the licensee/permittee.'' \9\ SpaceX stated that although the proposed rule might streamline the reciprocal waiver of claims process, ``it does not expressly provide the same protections to the licensee or permittee contained in the current rule.'' \10\ Specifically, SpaceX argued that, under the proposed rule, the licensee or permittee would have been required to waive and release any claims it might have against a part 440 customer and its contractors and subcontractors, but a part 440 customer's contractors and subcontractors would not have been required to waive claims against all other parties to which the reciprocal waiver requirements extended. SpaceX also noted that the contractors and subcontractors of a part 440 customer were not accounted for in proposed Sec. 440.17 or in proposed sections 4(b) and 5(b) of the part 440 appendices in the same way as under the current rules. SpaceX provided suggested language to address what it saw as inconsistencies. --------------------------------------------------------------------------- \9\ SpaceX comment p. 1 \10\ SpaceX comment at p. 2 --------------------------------------------------------------------------- After considering the comments, the FAA has decided to make changes to the regulatory text to preserve the intent of this rulemaking and Chapter 509. Accordingly, Sec. 440.17(b) and (c) require that each customer extends the reciprocal waiver of claims requirements to the customer's contractors and subcontractors. The reciprocal waiver of claims requires that the contractors and subcontractors of each customer waive and release claims, assume responsibility, hold harmless, and indemnify other parties identified in the waiver, including the licensee or permittee. This rule explicitly requires the licensee or permittee, each first-tier customer, and each part 440 customer to extend the reciprocal waiver of claims requirements to their contractors, subcontractors and customers. The FAA notes, however, that SpaceX recommended changing the text in each of the appendices to part 440 at section 4(b) to read: ``Customer shall extend the requirements of the waiver . . . respectively, to its Contractors, Subcontractors, customers, and such customers' contractors and subcontractors . . . .'' The FAA is not adopting this suggested change for two reasons. First, this suggested language misappropriates the responsibility to extend the reciprocal waiver of claims requirements. Under SpaceX's proposed language, each first-tier customer would be required to extend the reciprocal waiver of claims requirements to its customers' contractors and subcontractors. Instead, this rule requires each customer to extend the reciprocal waiver of claims requirements to its contractors and subcontractors, but not to its customers' contractors and subcontractors. This is consistent with the previous version of the part 440 appendices. Second, this language is unnecessary because the extension of responsibilities in Sec. 440.17(b)(2) and (3) and (c)(1)(iii) created by this rulemaking ensure that a part 440 customer extends to the customer's contractors and subcontractors the requirements of the reciprocal waiver of claims, which include waiving and releasing claims, assuming responsibility, and holding harmless and indemnifying other parties identified in the waiver,\11\ because a first-tier customer must extend the waiver requirements to its customer. In other words, the requirements work as follows: --------------------------------------------------------------------------- \11\ See, e.g., 80 FR 1590, 1600 (extending the assumption of responsibility and waiver and release of claims for a licensed launch with one customer). --------------------------------------------------------------------------- (1) Under Sec. 440.17 and the part 440 appendices, a first-tier customer must waive and release claims, assume responsibility, hold harmless, and indemnify other parties identified in the waiver, as set forth in paragraphs 2(b) and 3(a) of the appendices. Additionally, a first-tier customer must extend each of these requirements to its [[Page 55119]] contractors, subcontractors, and customers. (2) Because a first-tier customer must extend the requirements of the waiver, including the requirement to extend the waiver, to its customers, it follows that its customers will have the same obligation as a first-tier customer under the waiver. (3) Therefore, because of the extension of responsibilities, a first-tier customer's customers will be required, in turn, to extend the waiver requirements to their contractors, subcontractors and customers. Additionally, Sec. 440.17(b)(3) and (c)(1)(iii) explicitly require that each part 440 customer extends the reciprocal waiver of claims requirements to its contractors and subcontractors. Therefore, the FAA does not need to amend section 4(b) of the appendices to ensure that part 440 customers extend the waiver requirements to their contractors and subcontractors. Section 440.17(b)(2) and (3) and (c)(1)(iii) and section 4(b) of the appendices already require this. The FAA also disagrees with SpaceX's suggestion to amend section 5(b) of the appendices to require that a first-tier customer indemnify the appropriate parties from and against liability, loss, or damage arising out of any claim brought by its customer's contractors and subcontractors. Adopting SpaceX's suggestion would place an additional burden of indemnification on a first-tier customer that did not previously exist in part 440. Previous part 440 appendices required only that a first-tier customer indemnify the appropriate parties from and against liability, loss, or damage arising out of certain claims brought by its contractors, subcontractors, and employees. SpaceX's proposed language would additionally require a first-tier customer to indemnify from claims brought by its customer's contractors, subcontractors, and employees. As explained above, a first-tier customer is required to extend the reciprocal waiver of claims requirements to its customers. As a result of this extension, a first-tier customer's customer, rather than the first-tier customer himself, is required to indemnify against certain claims brought by its contractors, subcontractors, and employees. Lastly, Harris pointed out that the absence of part 440 customers and their contractors and subcontractors in proposed Sec. 440.17(b) exposes these parties to liability that represents a departure from Chapter 509. The FAA agrees, and this rule requires parties to the reciprocal waiver of claims described in Sec. 440.17(b) to waive claims against part 440 customers and their contractors and subcontractors. 2. Extension of Reciprocal Waiver of Claims to Part 440 Customers In its comment, Harris also noted that the FAA overlooked explicitly requiring each part 440 customer to comply with the reciprocal waiver of claims requirements. Therefore, the FAA now adds an explicit requirement in addition to the extension of requirements provisions in order to clarify that each part 440 customer must enter into a reciprocal waiver of claims agreement. This marks a change from the regulatory text that the FAA originally proposed. Harris commented that proposed Sec. 440.17(b) and (c) would not have ensured that part 440 customers waive claims against the other parties included in the waiver scheme. Harris further asserted that the purpose behind the waiver scheme is ``(1) [t]o limit the total universe of claims that might arise as a result of a launch; and (2) to eliminate the necessity for all of these parties to obtain property and casualty insurance to protect against these claims.'' \12\ --------------------------------------------------------------------------- \12\ Commercial Space Launch Act Amendments of 1988, Report of the Senate Committee on Commerce, Science, and Transportation on H.R. 4399, S. Rep. No. 100-593 at 14 (Oct. 7, 1988). --------------------------------------------------------------------------- The FAA agrees. Under Chapter 509 and the FAA's current rules, the licensee or permittee is required to enter into a reciprocal waiver of claims with all customers and their respective contractors and subcontractors involved in launch or reentry services. In other words, each customer must waive and release claims, assume responsibility, hold harmless, and indemnify other parties identified in the waiver. In the NPRM, the FAA proposed to require only first-tier customers to sign a reciprocal waiver of claims with the FAA and the licensee or permittee. By separating first-tier customers from part 440 customers, the proposed rule did not explicitly require part 440 customers to waive and release claims, assume responsibility, hold harmless, and indemnify other parties identified in the waiver. Instead, these requirements were implied by the extension of requirements in which a first-tier customer is required to extend the reciprocal waiver of claims requirements to its customers, contractors, and subcontractors. Because commenters expressed some confusion about the requirements, the FAA amends Sec. 440.17(b) and adds Sec. 440.17(c)(1)(iii)(D) to explicitly require that part 440 customers waive claims against all the other parties involved in the licensed activity. As stated previously, these requirements levied on part 440 customers also exist as a result of the extension of the reciprocal waiver of claims that is required by Sec. 440.17(b)(2), (b)(3), and (c)(1)(iii). By shifting the responsibility to extend the reciprocal waiver of claims from the licensee or permittee to the appropriate customer, the burden to indemnify also shifts. Therefore, should a customer fail to extend the reciprocal waiver of claims requirements to its customer, and its customer bring a claim against a party involved in the launch, the customer who failed to extend would be required to indemnify that party against its customer's claim. This represents a shift from the old scheme in which all customers signed the reciprocal waiver of claims, and therefore no one would be required to indemnify against a customer's claim unless the licensee failed to identify a customer and ensure that that customer signed the reciprocal waiver of claims. D. Removal of Permittees From Indemnification Scheme This rule does not change the indemnification scheme created by 51 U.S.C. 50915. Chapter 509 provides that the United States Government shall pay for a successful third party claim to the extent the claim exceeds the insurance coverage required by statute but does not exceed the statutory limit for such coverage, provided Congress appropriates the funds.\13\ Chapter 509 also lists the persons against whom the claim may be brought in order to qualify for this coverage.\14\ This list includes licensees, but does not include permittees. Therefore, Congress will not appropriate funds for a third party claim against a permittee that exceeds the insurance requirements in Chapter 509. --------------------------------------------------------------------------- \13\ 51 U.S.C. 50915(a)(1). \14\ 51 U.S.C. 50915(a)(3)(A). --------------------------------------------------------------------------- Although it received no comments on the issue, the FAA has identified an error in the proposed rule that it corrects with the final rule. In the proposed rule, the FAA would have included permittees in the indemnification scheme reserved by statute for licensees only. Because this error would create a conflict with the FAA's statutory authority, which the FAA did not intend, the FAA has amended the regulatory text in this final rule to comply with Chapter 509 by removing permittees from the section 50915 indemnification scheme. [[Page 55120]] E. Miscellaneous This rule includes a new Sec. 440.17(f) to include all provisions related to willful misconduct. The NPRM did not propose changing the willful misconduct provisions, and this rule also does not change those provisions but located them in Sec. 440.17(f) for clarity. IV. Regulatory Notices and Analyses A. Regulatory Evaluation Changes to Federal regulations must undergo several economic analyses. First, Executive Order 12866 and Executive Order 13563 direct that each Federal agency shall propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs. Second, the Regulatory Flexibility Act of 1980 (Public Law 96-354) requires agencies to analyze the economic impact of regulatory changes on small entities. Third, the Trade Agreements Act (Public Law 96-39) prohibits agencies from setting standards that create unnecessary obstacles to the foreign commerce of the United States. In developing U.S. standards, this Trade Act requires agencies to consider international standards and, where appropriate, that they be the basis of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995 (Public Law 104-4) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more annually (adjusted for inflation with base year of 1995). This portion of the preamble summarizes the FAA's analysis of the economic impacts of this final rule. We suggest readers seeking greater detail read the full regulatory evaluation, a copy of which we have placed in the docket for this rulemaking. In conducting these analyses, FAA has determined that this final rule: (1) Has benefits that justify its costs, (2) is not an economically ``significant regulatory action'' as defined in section 3(f) of Executive Order 12866, (3) is not ``significant'' as defined in DOT's Regulatory Policies and Procedures; (4) will not have a significant economic impact on a substantial number of small entities; (5) will not create unnecessary obstacles to the foreign commerce of the United States; and (6) will not impose an unfunded mandate on State, local, or tribal governments, or on the private sector by exceeding the threshold identified above. These analyses are summarized below. As we received no comments on the benefit cost methodology, we used the same methodology here. Total Benefits and Costs of This Rule These changes will result in cost savings to the licensee or permittee, Government and customers and minimal cost to the first-tier customer if it has customers to the launch. Cost savings are presented in the table below, which is discussed in more detail in the paragraphs that follow. Cost Savings from the Final Rule ---------------------------------------------------------------------------------------------------------------- 7% Present 3% Present Average value cost value cost savings savings ---------------------------------------------------------------------------------------------------------------- Government Cost Savings......................................... $138,440 $97,232 $118,092 Licensee and Permittee Cost Savings: No Longer Requesting Waivers................................ 136,282 95,716 116,251 No Longer Obtaining Part 440 Customer Signatures................ 17,035 11,965 14,531 Cost Savings from Allowing Signatures on Different Set of 365 256 311 Reciprocal Waiver of Claims.................................... ----------------------------------------------- Total estimated cost savings............................ 292,121 205,169 249,185 ---------------------------------------------------------------------------------------------------------------- Minor rounding occurs in summation. The final rule might result in minimal costs to first-tier customers who will be responsible for implementing reciprocal waivers of claims with their customers. Who Is Potentially Affected by This Rule? Launch Licensees and Permittees Federal Government Customers of the Launch Licensees and Permittees Assumptions The following assumptions apply to the analysis:Ten year time horizon 2013 dollars Without the rule, the FAA will issue 4 partial waivers to the reciprocal cross waiver requirement per year Without the rule, a licensee or permittee will have to obtain some signatures from part 440 customers on launches unless waivers have been issued Benefits of This Rule The final rule will result in cost savings because licensees and permittees will no longer have to obtain signatures of part 440 customers on the reciprocal waiver of claims. Cost savings may result because licensees and permittees will not have to incur expenses to obtain part 440 signatures or licensees and permittees will not seek waivers from the FAA to the requirement that part 440 customers sign the reciprocal waiver of claims. The estimated cost savings to the licensee, permittee, and the Federal Government that will result were indicated in the table above. Also, the FAA estimated a small cost savings due to the final rule allowing a customer added at the last minute to sign a new and separate waiver of claims agreement. Finally, the FAA expects minimal cost savings with the addition of a template for permitted activities with no customer. Costs of This Rule The responsibility to obtain signatures of customers who are not in a direct contractual relationship (i.e., part 440 customers) with the licensee or permittee will shift under the final rule, from the licensee or permittee to the appropriate first-tier customer. The FAA expects the costs the first-tier customer will incur under the rule to implement the reciprocal waiver of claims to be minimal because the first-tier customer could modify the templates provided in appendices B and C to part 440 and add them to the contract that it has with its customers. The FAA thinks that this will be a one-time cost that could be accomplished in a short period of time by the company's in-house lawyers. In addition, customers are currently required to extend the FAA reciprocal waiver of claims obligations to their [[Page 55121]] respective contractors and subcontractors, so the FAA does not expect the changes to the NPRM to result in additional costs. B. Regulatory Flexibility Determination The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA) establishes ``as a principle of regulatory issuance that agencies shall endeavor, consistent with the objectives of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the businesses, organizations, and governmental jurisdictions subject to regulation. To achieve this principle, agencies are required to solicit and consider flexible regulatory proposals and to explain the rationale for their actions to assure that such proposals are given serious consideration.'' The RFA covers a wide-range of small entities, including small businesses, not-for-profit organizations, and small governmental jurisdictions. Agencies must perform a review to determine whether a rule will have a significant economic impact on a substantial number of small entities. If the agency determines that it will, the agency must prepare a regulatory flexibility analysis as described in the RFA. However, if an agency determines that a rule is not expected to have a significant economic impact on a substantial number of small entities, section 605(b) of the RFA provides that the head of the agency may so certify and a regulatory flexibility analysis is not required. The certification must include a statement providing the factual basis for this determination, and the reasoning should be clear. The FAA believes that this final rule will not have a significant impact on a substantial number of entities because the rule will result in cost savings and some minimal costs as described below. The FAA solicited comments in the NPRM regarding the initial regulatory flexibility analysis minimal cost determination, and received none. As we made the same determination for the initial regulatory flexibility analysis, we accept this determination for the final regulatory flexibility analysis. The reasons for the minimal cost determination are provided below. Cost savings are expected because the licensee or permittee will no longer have to request waivers or obtain part 440 customers' signatures, nor have to reopen the original waivers to obtain signatures if a party is added to the launch at the last minute. However, there might be minimal costs to first-tier customers. The responsibility to obtain signatures of customers who are not in a direct contractual relationship (i.e., part 440 customers) with the licensee or permittee will shift under the final rule, from the licensee or permittee to the appropriate first-tier customer. This will be a new requirement on the first-tier customer. Under the final rule, the first-tier customers will be responsible, as described above, for implementing a reciprocal waiver of claims with their customers. These costs will be minimal because the first-tier customer could modify the templates provided in appendices B and C to part 440 and add it to the contract that it has with its customers. The FAA thinks that this will be a one-time cost that could be accomplished in a short period of time by the company's in-house lawyers at an estimated cost of $185. It is not clear whether this minimal cost will impact a substantial number of small entities. To date, the FAA is unaware of any small entities who would be affected. The agency does not know whether in the future there might be small entities, that will have to implement a reciprocal waiver of claims with their customers, but even if there were a substantial number of small entities, the final rule will not have a significant impact on these entities. Therefore, as provided in section 605(b), the head of the FAA certifies that this rulemaking will not result in a significant economic impact on a substantial number of small entities. C. International Trade Impact Assessment The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal agencies from establishing standards or engaging in related activities that create unnecessary obstacles to the foreign commerce of the United States. Pursuant to these Acts, the establishment of standards is not considered an unnecessary obstacle to the foreign commerce of the United States, so long as the standard has a legitimate domestic objective, such as the protection of safety, and does not operate in a manner that excludes imports that meet this objective. The statute also requires consideration of international standards and, where appropriate, that they be the basis for U.S. standards. The FAA has assessed the potential effect of this final rule and determined that it will impose the same costs on domestic and international entities and thus has a neutral trade impact. D. Unfunded Mandates Assessment Title II of the Unfunded Mandates Reform Act of 1995 (Pub.L. 104-4) requires each Federal agency to prepare a written statement assessing the effects of any Federal mandate in a proposed or final agency rule that may result in an expenditure of $100 million or more (in 1995 dollars) in any one year by State, local, and tribal governments, in the aggregate, or by the private sector; such a mandate is deemed to be a ``significant regulatory action.'' The FAA currently uses an inflation-adjusted value of $155.0 million in lieu of $100 million. This final rule does not contain such a mandate; therefore, the requirements of Title II of the Act do not apply. E. Paperwork Reduction Act The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires that the FAA consider the impact of paperwork and other information collection burdens imposed on the public. The FAA has determined that there would be no new requirement for information collection associated with this rule. F. International Compatibility and Cooperation In keeping with U.S. obligations under the Convention on International Civil Aviation, it is FAA policy to conform to International Civil Aviation Organization (ICAO) Standards and Recommended Practices to the maximum extent practicable. The FAA has determined that there are no ICAO Standards and Recommended Practices that correspond to these proposed regulations. G. Environmental Analysis FAA Order 1050.1F identifies FAA actions that are categorically excluded from preparation of an environmental assessment or environmental impact statement under the National Environmental Policy Act in the absence of extraordinary circumstances. The FAA has determined this rulemaking action qualifies for the categorical exclusion identified in paragraph 5-6.6 and involves no extraordinary circumstances. V. Executive Order Determinations A. Executive Order 13132, Federalism The FAA has analyzed this final rule under the principles and criteria of Executive Order 13132, Federalism. The agency determined that this action will not have a substantial direct effect on the States, or the relationship between the Federal Government and the States, or on the distribution of power and responsibilities among the various [[Page 55122]] levels of government, and, therefore, does not have Federalism implications. B. Executive Order 13211, Regulations That Significantly Affect Energy Supply, Distribution, or Use The FAA analyzed this final rule under Executive Order 13211, Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use (May 18, 2001). The agency has determined that it is not a ``significant energy action'' under the executive order and it is not likely to have a significant adverse effect on the supply, distribution, or use of energy. VI. How To Obtain Additional Information A. Rulemaking Documents An electronic copy of a rulemaking document may be obtained by using the Internet-- 1. Search the Federal eRulemaking Portal (http://www.regulations.gov); 2. Visit the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies/ or 3. Access the Government Printing Office's Web page at http://www.thefederalregister.org/fdsys/. Copies may also be obtained by sending a request (identified by notice, amendment, or docket number of this rulemaking) to the Federal Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence Avenue SW., Washington, DC 20591, or by calling (202) 267-9680. B. Comments Submitted to the Docket Comments received may be viewed by going to http://www.regulations.gov and following the online instructions to search the docket number for this action. Anyone is able to search the electronic form of all comments received into any of the FAA's dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). C. Small Business Regulatory Enforcement Fairness Act The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996 requires the FAA to comply with small entity requests for information or advice about compliance with statutes and regulations within its jurisdiction. A small entity with questions regarding this document, may contact its local FAA official, or the person listed under the FOR FURTHER INFORMATION CONTACT heading at the beginning of the preamble. To find out more about SBREFA on the Internet, visit http://www.faa.gov/regulations_policies/rulemaking/sbre_act/. List of Subjects in 14 CFR Part 440 Indemnity payments, Insurance, Reporting and recordkeeping requirements, Space transportation and exploration. The Amendments In consideration of the foregoing, the Federal Aviation Administration amends chapter III of title 14, Code of Federal Regulations as follows: PART 440--FINANCIAL RESPONSIBILITY 0 1. The authority citation for part 440 continues to read as follows: Authority: 51 U.S.C. 50901-50923. 0 2. Amend Sec. 440.3 by adding the definitions of first-tier customer and part 440 customer in alphabetical order to read as follows: Sec. 440.3 Definitions. * * * * * First-tier customer means a customer as defined in this section, and who has a contractual relationship with a license or permit holder to obtain launch or reentry services. * * * * * Part 440 customer means a customer as defined in this section, other than a first-tier customer. * * * * * 0 3. Amend Sec. 440.17 by revising paragraphs (b) through (f) to read as follows: Sec. 440.17 Reciprocal waiver of claims requirements. * * * * * (b) The licensee or permittee and each of its contractors and subcontractors, each customer, and each customer's contractors and subcontractors, must enter into a reciprocal waiver of claims agreement under which each party waives and releases claims against all the other parties to the waiver and against any other customer, and agrees to assume financial responsibility for property damage it sustains and for bodily injury or property damage sustained by its own employees, and to hold harmless and indemnify each other from bodily injury or property damage sustained by its employees, resulting from a licensed or permitted activity, regardless of fault. (1) The licensee or permittee must extend the reciprocal waiver of claims requirements to each of its contractors and subcontractors involved in launch or reentry services, and each of its first-tier customers. (2) Any first-tier customer must extend the reciprocal waiver of claims requirements to each of its contractors and subcontractors involved in launch or reentry services, and each of its customers. (3) Any part 440 customer must extend the reciprocal waiver of claims requirements to each of its contractors and subcontractors involved in launch or reentry services, and each of its customers. (c) For each licensed or permitted activity in which the United States, or its contractors and subcontractors, is involved or where property insurance is required under Sec. 440.9(d), the Federal Aviation Administration of the Department of Transportation, the licensee or permittee, and each first-tier customer must enter into a reciprocal waiver of claims agreement. The reciprocal waiver of claims must be in the form set forth in appendix B of this part for a licensed activity, in appendix C of this part for a permitted activity, or in a form that otherwise provides all the same obligations and benefits. The reciprocal waiver of claims must provide that: (1) Each party to the reciprocal waiver of claims, including the United States but only to the extent provided in legislation: (i) Waives and releases claims it may have against each other party to the reciprocal waiver of claims, any customer, and against their respective contractors and subcontractors, for property damage it sustains and for bodily injury or property damage sustained by its own employees, resulting from licensed or permitted activities, regardless of fault; (ii) Assumes responsibility for property damage it sustains and for bodily injury or property damage sustained by its own employees, resulting from licensed or permitted activities, regardless of fault. A licensee or permittee and each first-tier customer shall each hold harmless and indemnify each other, the United States, any other customer, and the contractors and subcontractors of each for bodily injury or property damage sustained by its own employees, resulting from licensed or permitted activities, regardless of fault; and (iii) Extends the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, to its contractors and subcontractors involved in launch and reentry services, and, for each customer, to its contractors and subcontractors involved in launch and reentry services, and customers, by [[Page 55123]] requiring them to waive and release all claims as follows: (A) For each contractor and subcontractor of the licensee or permittee, all claims against any customer, the United States, and each of their respective contractors and subcontractors, and to agree to be responsible for property damage they sustain and to be responsible, hold harmless and indemnify any customer, the United States, and each of their respective contractors and subcontractors, for bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault; (B) For each contractor and subcontractor of any customer, all claims against the licensee or permittee, any other customer, the United States, and each of their respective contractors and subcontractors, and to agree to be responsible for property damage they sustain and to be responsible, hold harmless and indemnify the licensee or permittee, any other customer, the United States, and each of their respective contractors and subcontractors, for bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault; (C) For each contractor and subcontractor of the United States, all claims against the licensee or permittee, any customer, and each of their respective contractors and subcontractors, and to agree to be responsible for property damage they sustain and to be responsible, hold harmless and indemnify the licensee or permittee, any other customer, the United States, and each of their respective contractors and subcontractors, for bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e); (D) For each part 440 customer, all claims against the licensee or permittee, any other customer, the United States, and each of their respective contractors and subcontractors; and to agree to be responsible for property damage they sustain and to be responsible, hold harmless and indemnify the licensee or permittee, any other customer, the United States, and each of their respective contractors and subcontractors, for bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault; and (2) For the following parties-- (i) The licensee or permittee must hold harmless and indemnify each first-tier customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its servants, agents, subsidiaries, employees and assignees, or any of them; and any part 440 customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them from and against liability, loss or damage arising out of claims that any of licensee's or permittee's contractors and subcontractors may have for property damage sustained by them and for bodily injury or property damage sustained by their employees, resulting from licensed or permitted activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. The requirement of paragraph (c)(2)(i) of this section to hold harmless and indemnify the United States and its servants, agents, subsidiaries, employees and assignees, or any of them, does not apply when: (A) Claims result from willful misconduct of the United States or its agents; (B) Claims for property damage sustained by the United States or its contractors and subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e); (C) For licensed activity, claims by a third party for bodily injury or property damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c), and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19; or (D) The licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c). (ii) Each first-tier customer must hold harmless and indemnify the licensee or permittee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its servants, agents, subsidiaries, employees and assignees, or any of them; and any part 440 customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that any of each first-tier customer's customers, contractors, or subcontractors, may have for property damage sustained by them and for bodily injury or property damage sustained by their employees, resulting from licensed or permitted activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (iii) The Federal Aviation Administration of the Department of Transportation on behalf of the United States, but only to the extent provided in legislation, must hold harmless and indemnify the licensee or permittee, each first-tier customer, any part 440 customer, and their respective directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that contractors and subcontractors of the United States may have for property damage sustained by them and for bodily injury or property damage sustained by their employees, resulting from licensed or permitted activities and arising out of the indemnifying party's failure to implement properly the waiver requirement to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e). (d) For each licensed or permitted activity in which the United States or its contractors and subcontractors are involved, the Federal Aviation Administration of the Department of Transportation and each space flight participant must enter into or have in place a reciprocal waiver of claims agreement. The reciprocal waiver of claims must be in the form set forth in appendix E of this part, or in a form that otherwise provides all the same obligations and benefits. (1) The reciprocal waiver of claims must provide that each space flight participant: (i) Waive and release claims he or she may have against the United States, and against each of its contractors and subcontractors, for bodily injury or property damage sustained by the space flight participant, resulting from licensed or permitted activities, regardless of fault; (ii) Assume responsibility for bodily injury or property damage, sustained by the space flight participant, resulting from licensed or permitted activities, regardless of fault; (iii) Hold harmless the United States, and its contractors and subcontractors, for bodily injury or property damage, sustained by the space flight participant, [[Page 55124]] resulting from licensed or permitted activities, regardless of fault; and (iv) Hold harmless and indemnify the United States and its servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss, or damage arising out of claims brought by anyone for property damage or bodily injury sustained by the space flight participant, resulting from licensed or permitted activities. (2) The reciprocal waiver of claims must provide that the United States: (i) Waive and release claims it may have against the space flight participant for property damage it sustains, and for bodily injury or property damage sustained by its own employees, resulting from licensed or permitted activities, regardless of fault; (ii) Assume responsibility for property damage it sustains, and for bodily injury or property damage sustained by its own employees, resulting from licensed activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively; (iii) Assume responsibility for property damage it sustains, resulting from permitted activities, regardless of fault, to the extent that claims it would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e); (iv) Extend the requirements of the waiver and release of claims, and the assumption of responsibility to its contractors and subcontractors by requiring them to waive and release all claims they may have against the space flight participant, and to agree to be responsible, for any property damage they sustain and for any bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault; and (v) Extend the requirements of the waiver and release of claims, and the assumption of responsibility to its contractors and subcontractors by requiring them to waive and release all claims they may have against the space flight participant, and to agree to be responsible, for any property damage they sustain, resulting from permitted activities, regardless of fault. (e) For each licensed or permitted activity in which the United States or its contractors and subcontractors is involved, the Federal Aviation Administration of the Department of Transportation and each crew member must enter into or have in place a reciprocal waiver of claims agreement. The reciprocal waiver of claims must be in the form set forth in appendix D of this part, or in a form that otherwise provides all the same obligations and benefits. (1) The reciprocal waiver of claims must provide that each crew member: (i) Waive and release claims he or she may have against the United States, and against each of its contractors and subcontractors, for bodily injury or property damage sustained by the crew member, resulting from licensed or permitted activities, regardless of fault; (ii) Assume responsibility for bodily injury or property damage, sustained by the crew member, resulting from licensed or permitted activities, regardless of fault; (iii) Hold harmless the United States, and its contractors and subcontractors, for bodily injury or property damage, sustained by the crew member, resulting from licensed or permitted activities, regardless of fault; and (iv) Hold harmless and indemnify the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss, or damage arising out of claims brought by anyone for property damage or bodily injury sustained by the crew member, resulting from licensed or permitted activities. (2) The reciprocal waiver of claims must provide that the United States: (i) Waive and release claims it may have against the crew member for property damage it sustains, and for bodily injury, including death, or property damage sustained by its own employees, resulting from licensed or permitted activities, regardless of fault; (ii) Assume responsibility for property damage it sustains, and for bodily injury or property damage sustained by its own employees, resulting from licensed activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively; (iii) Assume responsibility for property damage it sustains, resulting from permitted activities, regardless of fault, to the extent that claims it would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e); (iv) Extend the requirements of the waiver and release of claims, and the assumption of responsibility to its contractors and subcontractors by requiring them to waive and release all claims they may have against the crew member and to agree to be responsible, for any property damage they sustain and for any bodily injury or property damage sustained by their own employees, resulting from licensed activities, regardless of fault; and (v) Extend the requirements of the waiver and release of claims, and the assumption of responsibility to its contractors and subcontractors by requiring them to waive and release all claims they may have against the crew member and to agree to be responsible, for any property damage they sustain, resulting from permitted activities, regardless of fault. (f) Any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify pursuant to this section does not apply to claims for bodily injury or property damage resulting from willful misconduct of any of the parties to the reciprocal waiver of claims, the contractors and subcontractors of any of the parties to the reciprocal waiver of claims, and in the case of licensee or permittee and customers and the contractors and subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. 0 4. Revise appendix B to part 440 to read as follows: Appendix B to Part 440--Agreement for Waiver of Claims and Assumption of Responsibility for Licensed Activities Part 1--Waiver of Claims and Assumption of Responsibility for Licensed Launch, Including Suborbital Launch Subpart A--Waiver of Claims and Assumption of Responsibility for Licensed Launch, Including Suborbital Launch, With One Customer This agreement is entered into this__day of____, by and among [Licensee] (the ``Licensee''), [Customer] (the ``Customer'') and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to the launch of [Payload] payload on a [Launch Vehicle] vehicle at [Location of Launch Site]. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Customer means the above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above-named Customer. License means License No.__issued on____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department [[Page 55125]] of Transportation, to the Licensee, including all license orders issued in connection with the License. Licensee means the Licensee and any transferee of the Licensee under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Licensed Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Licensee hereby waives and releases claims it may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) Customer hereby waives and releases claims it may have against Licensee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Licensee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Licensee and Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. Licensee and Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Licensee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (b) Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Licensee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 5. Indemnification (a) Licensee shall hold harmless and indemnify Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Licensee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Customer shall hold harmless and indemnify Licensee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Customer's Contractors, Subcontractors, or customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (c) To the extent provided in advance in an appropriations law or to the extent there is enacted additional legislative authority providing for the payment of claims, the United States shall hold harmless and indemnify Licensee, Customer, any Part 440 Customer, and their respective directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Contractors and Subcontractors of the United States may have for Property Damage sustained by them, and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Licensee shall hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Licensed Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. [[Page 55126]] 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Licensee, Customer or the United States of any claim by an employee of the Licensee, Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Licensed Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customer, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Licensee, Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Licensee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation Subpart B--Waiver of Claims and Assumption of Responsibility for Licensed Launch, Including Suborbital Launch, With More Than One Customer This agreement is entered into this__day of____, by and among [Licensee] (the ``Licensee''); [List of Customers]; (with [List of Customers] hereinafter referred to in their individual capacity as ``Customer''); and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to the launch of [Payload] payload on a [Launch Vehicle] vehicle at [Location of Launch Site]. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Customer means each above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above-named Customer. License means License No.__issued on____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Licensee, including all license orders issued in connection with the License. Licensee means the Licensee and any transferee of the Licensee under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Licensed Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Licensee hereby waives and releases claims it may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) Each Customer hereby waives and releases claims it may have against Licensee, the United States, any other customer, and each of their respective Contractors and Subcontractors for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Licensee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Licensee and each Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. Licensee and each Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Licensee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (b) Each Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Licensee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 5. Indemnification (a) Licensee shall hold harmless and indemnify each Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any part 440 customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against [[Page 55127]] liability, loss or damage arising out of claims that Licensee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Each Customer shall hold harmless and indemnify Licensee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that each Customer's Contractors, Subcontractors, or customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (c) To the extent provided in advance in an appropriations law or to the extent there is enacted additional legislative authority providing for the payment of claims, the United States shall hold harmless and indemnify Licensee, each Customer, any Part 440 Customer, and their respective directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Contractors and Subcontractors of the United States may have for Property Damage sustained by them, and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Licensee shall hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Licensed Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Licensee, any Customer or the United States of any claim by an employee of the Licensee, any Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Licensed Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customer, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Licensee, each Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) References herein to Customer shall apply to, and be deemed to include, each such customer severally and not jointly. (d) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Licensee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer 1 By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- [Signature lines for each additional customer] Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation Part 2--Waiver of Claims and Assumption of Responsibility for Licensed Reentry Subpart A--Waiver of Claims and Assumption of Responsibility for Licensed Reentry With One Customer This Agreement is entered into this __ day of ____, by and among [Licensee] (the ``Licensee''), [Customer] (the ``Customer''), and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to the reentry of the [Payload] payload on a [Reentry Vehicle] vehicle. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Customer means the above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above named Customer. License means License No. __ issued on ____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Licensee, including all license orders issued in connection with the License. Licensee means the Licensee and any transferee of the Licensee under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Licensed Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Licensee hereby waives and releases claims it may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) Customer hereby waives and releases claims it may have against Licensee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Licensee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Licensee and Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. [[Page 55128]] Licensee and Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e) of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Licensee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (b) Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Licensee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 5. Indemnification (a) Licensee shall hold harmless and indemnify Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them from and against liability, loss or damage arising out of claims that Licensee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Customer shall hold harmless and indemnify Licensee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them from and against liability, loss or damage arising out of claims that Customer's Contractors, Subcontractors, or customers may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (c) To the extent provided in advance in an appropriations law or to the extent there is enacted additional legislative authority providing for the payment of claims, the United States shall hold harmless and indemnify Licensee, Customer, any Part 440 Customer, and their respective directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Contractors and Subcontractors of the United States may have for Property Damage sustained by them, and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e) of the Regulations. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Licensee shall hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Licensed Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Licensee, Customer or the United States of any claim by an employee of the Licensee, Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Licensed Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customer, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Licensee, Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) This Agreement shall be governed by and construed in accordance with United States Federal law. In Witness Whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Licensee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation Subpart B--Waiver of Claims and Assumption of Responsibility for Licensed Reentry With More Than One Customer This agreement is entered into this __ day of ____, by and among [Licensee] [[Page 55129]] (the ``Licensee''); [List of Customers] (with [List of Customers] hereinafter referred to in their individual capacity as ``Customer''); and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to the reentry of [Payload] payload on a [Reentry Vehicle] vehicle. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities described in Sec. 440.3 of the Regulations. Customer means each above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above-named customer. License means License No. __ issued on ____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Licensee, including all license orders issued in connection with the License. Licensee means the Licensee and any transferee of the Licensee under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Licensed Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Licensee hereby waives and releases claims it may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) Each Customer hereby waives and releases claims it may have against Licensee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Licensee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Licensee and each Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. Licensee and each Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Licensee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (b) Each Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Licensee, the United States, and any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Licensee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Licensed Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 5. Indemnification (a) Licensee shall hold harmless and indemnify each Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Licensee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Each Customer shall hold harmless and indemnify Licensee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; and the United States and any other customer as defined by Sec. 440.3 its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that each Customer's Contractors, Subcontractors, and customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (c) To the extent provided in advance in an appropriations law or to the extent there is enacted additional legislative authority providing for the payment of claims, the United States shall hold harmless and indemnify Licensee, each Customer, any Part 440 Customer, and their respective directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Contractors and Subcontractors of the United States may have for Property Damage sustained by them, and for Bodily Injury or Property Damage sustained by their employees, resulting from Licensed Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Licensee shall [[Page 55130]] hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Licensed Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Licensee, any Customer or the United States of any claim by an employee of the Licensee, any Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Licensed Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customers, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Licensee, each Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) References herein to Customer shall apply to, and be deemed to include, each such customer severally and not jointly. (d) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Licensee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer 1 By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- [Signature lines for each additional customer] Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation 0 5. Revise appendix C to part 440 to read as follows: Appendix C to Part 440--Agreement for Waiver of Claims and Assumption of Responsibility for Permitted Activities Part 1--Waiver of Claims and Assumption of Responsibility for Permitted Activities With No Customer This agreement is entered into this __ day of ____, by and between [Permittee] (the ``Permittee'') and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to [describe permitted activity]. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Permit means Permit No._______issued on ____________, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Permittee, including all permit orders issued in connection with the Permit. Permittee means the holder of the Permit issued under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Permitted Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Permittee hereby waives and releases claims it may have against the United States, and against its Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) The United States hereby waives and releases claims it may have against Permittee and against its Contractors and Subcontractors, for Property Damage it sustains resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations. 3. Assumption of Responsibility (a) Permittee shall be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. Permittee shall hold harmless and indemnify the United States, and the Contractors and Subcontractors of the United States, for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Permittee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against the United States, and against the Contractors and Subcontractors of the United States, and to agree to be responsible for Property Damage they sustain and to be responsible, hold harmless, and indemnify the United States, and the Contractors and Subcontractors of the United States, for Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault. (b) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(b) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Permittee, and against the Contractors and Subcontractors of Permittee, and to agree to be responsible, for any Property Damage they sustain, resulting from Permitted Activities, regardless of fault, to the extent that claims they would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations. 5. Indemnification Permittee shall hold harmless and indemnify the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss, or damage arising out of claims that Permittee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. 6. Assurances Under 51 U.S.C. 50914(e) (a) Permittee shall hold harmless and indemnify Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 [[Page 55131]] Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Permittee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities. (b) Customer shall hold harmless and indemnify Permittee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Customer's Contractors, Subcontractors, and customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Permittee or the United States of any claim by an employee of the Permittee or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Permitted Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility, or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, and in the case of Permittee and its Contractors and Subcontractors, the directors, officers, agents, and employees of any of the foregoing, and in the case of the United States, its agents. (c) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Permittee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation Part 2--Waiver of Claims and Assumption of Responsibility for Permitted Activities With One Customer This agreement is entered into this __ day of ____, by and among [Permittee] (the ``Permittee''), [Customer] (the ``Customer'') and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to [describe permitted activity]. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Customer means the above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above-named customer. Permit means Permit No. __ issued on ____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Permittee, including all permit orders issued in connection with the Permit. Permittee means the holder of the Permit issued under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Permitted Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Permittee hereby waives and releases claims it may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) Customer hereby waives and releases claims it may have against Permittee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Permittee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Permittee and Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. Permittee and Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Permittee shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault. (b) Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Permittee, the United States, any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Permittee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Permittee, Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. [[Page 55132]] 5. Indemnification (a) Permittee shall hold harmless and indemnify Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Permittee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Customer shall hold harmless and indemnify Permittee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Customer's Contractors, Subcontractors, and customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Permittee shall hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Permitted Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Permittee, Customer or the United States of any claim by an employee of the Permittee, Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Permitted Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customer, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Permittee, Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Permittee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Associate Administrator for Commercial Space Transportation Part 3--Waiver of Claims and Assumption of Responsibility for Permitted Activities With More Than One Customer This agreement is entered into this __ day of ____, by and among [Permittee] (the ``Permittee''); [List of Customers]; (with [List of Customers] hereinafter referred to in their individual capacity as ``Customer''); and the Federal Aviation Administration of the Department of Transportation, on behalf of the United States Government (collectively, the ``Parties''), to implement the provisions of Sec. 440.17(c) of the Commercial Space Transportation Licensing Regulations, 14 CFR Ch. III (the ``Regulations''). This agreement applies to [describe permitted activity]. In consideration of the mutual releases and promises contained herein, the Parties hereby agree as follows: 1. Definitions Contractors and Subcontractors means entities defined by Sec. 440.3 of the Regulations. Customer means each above-named Customer. Part 440 Customer means a customer defined by Sec. 440.3 of the Regulations, other than the above-named Customer. Permit means Permit No. __ issued on ____, by the Associate Administrator for Commercial Space Transportation, Federal Aviation Administration, Department of Transportation, to the Permittee, including all permit orders issued in connection with the Permit. Permittee means the holder of the Permit issued under 51 U.S.C. Subtitle V, ch. 509. United States means the United States and its agencies involved in Permitted Activities. Except as otherwise defined herein, terms used in this Agreement and defined in 51 U.S.C. Subtitle V, ch. 509--Commercial Space Launch Activities, or in the Regulations, shall have the same meaning as contained in 51 U.S.C. Subtitle V, ch. 509, or the Regulations, respectively. 2. Waiver and Release of Claims (a) Permittee hereby waives and releases claims it may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) Each Customer hereby waives and releases claims it may have against Permittee, the United States, any other customer, and each of their Contractors and Subcontractors, for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (c) The United States hereby waives and releases claims it may have against Permittee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Property Damage it sustains, and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 3. Assumption of Responsibility (a) Permittee and each Customer shall each be responsible for Property Damage it sustains and for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. Permittee and each Customer shall each hold harmless and indemnify each other, the United States, any other customer, and the Contractors and Subcontractors of each, for Bodily Injury or Property Damage sustained by its own employees, resulting from Permitted Activities, regardless of fault. (b) The United States shall be responsible for Property Damage it sustains, resulting from Permitted Activities, regardless of fault, to the extent that claims it would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations. 4. Extension of Assumption of Responsibility and Waiver and Release of Claims (a) Permittee shall extend the requirements of the waiver and release of claims, and the [[Page 55133]] assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(a) and 3(a), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify each Customer, the United States, any Part 440 Customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault. (b) Each Customer shall extend the requirements of the waiver and release of claims, and the assumption of responsibility, hold harmless, and indemnification, as set forth in paragraphs 2(b) and 3(a), respectively, to its customers, Contractors, and Subcontractors, by requiring them to waive and release all claims they may have against Permittee, the United States, any other customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for Property Damage they sustain and to be responsible, hold harmless and indemnify Permittee, the United States, any other customer, and each of their respective Contractors and Subcontractors, for Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault. (c) The United States shall extend the requirements of the waiver and release of claims, and the assumption of responsibility as set forth in paragraphs 2(c) and 3(b), respectively, to its Contractors and Subcontractors by requiring them to waive and release all claims they may have against Permittee, each Customer, any Part 440 Customer, and each of their respective Contractors and Subcontractors, and to agree to be responsible, for any Property Damage they sustain and for any Bodily Injury or Property Damage sustained by their own employees, resulting from Permitted Activities, regardless of fault, to the extent that claims they would otherwise have for such damage or injury exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) and (e), respectively, of the Regulations. 5. Indemnification (a) Permittee shall hold harmless and indemnify each Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any Part 440 Customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that Permittee's Contractors and Subcontractors may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. (b) Each Customer shall hold harmless and indemnify Permittee and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them; the United States and its agencies, servants, agents, subsidiaries, employees and assignees, or any of them; and any other customer and its directors, officers, servants, agents, subsidiaries, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims that each Customer's Contractors, Subcontractors, and customers, may have for Property Damage sustained by them and for Bodily Injury or Property Damage sustained by their employees, resulting from Permitted Activities and arising out of the indemnifying party's failure to implement properly the waiver requirement. 6. Assurances Under 51 U.S.C. 50914(e) Notwithstanding any provision of this Agreement to the contrary, Permittee shall hold harmless and indemnify the United States and its agencies, servants, agents, employees and assignees, or any of them, from and against liability, loss or damage arising out of claims for Bodily Injury or Property Damage, resulting from Permitted Activities, regardless of fault, except to the extent that: (i) As provided in paragraph 7(b) of this Agreement, claims result from willful misconduct of the United States or its agents; (ii) claims for Property Damage sustained by the United States or its Contractors and Subcontractors exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(e) of the Regulations; (iii) claims by a Third Party for Bodily Injury or Property Damage exceed the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations, and do not exceed $1,500,000,000 (as adjusted for inflation after January 1, 1989) above such amount, and are payable pursuant to the provisions of 51 U.S.C. 50915 and Sec. 440.19 of the Regulations; or (iv) Licensee has no liability for claims exceeding $1,500,000,000 (as adjusted for inflation after January 1, 1989) above the amount of insurance or demonstration of financial responsibility required under Sec. 440.9(c) of the Regulations. 7. Miscellaneous (a) Nothing contained herein shall be construed as a waiver or release by Permittee, any Customer or the United States of any claim by an employee of the Permittee, any Customer or the United States, respectively, including a member of the Armed Forces of the United States, for Bodily Injury or Property Damage, resulting from Permitted Activities. (b) Notwithstanding any provision of this Agreement to the contrary, any waiver, release, assumption of responsibility or agreement to hold harmless and indemnify herein shall not apply to claims for Bodily Injury or Property Damage resulting from willful misconduct of any of the Parties, the Contractors and Subcontractors of any of the Parties, any Part 440 Customer, the Contractors and Subcontractors of any Part 440 Customer, and in the case of Permittee, each Customer, any Part 440 Customer, and the Contractors and Subcontractors of each of them, the directors, officers, agents and employees of any of the foregoing, and in the case of the United States, its agents. (c) References herein to Customer shall apply to, and be deemed to include, each such customer severally and not jointly. (d) This Agreement shall be governed by and construed in accordance with United States Federal law. In witness whereof, the Parties to this Agreement have caused the Agreement to be duly executed by their respective duly authorized representatives as of the date written above. Permittee By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Customer 1 By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- [Signature lines for each additional customer] Federal Aviation Administration of the Department of Transportation on Behalf of the United States Government By:-------------------------------------------------------------------- Its:------------------------------------------------------------------- Issued under authority provided by 49 U.S.C. 106(f), 44701(a), and 44703 in Washington, DC, on July 25, 2016. Michael P. Huerta, Administrator. [FR Doc. 2016-18765 Filed 8-17-16; 8:45 am] BILLING CODE 4910-13-P
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TABLE 17—TEST OPERATING AND TEST CONDITION TOLERANCES FOR FROST ACCUMULATION HEATING MODE TESTS—
Continued
Test operating tolerance 1 Test condition
tolerance 1
Sub-interval H 2 Sub-interval D 3 Sub-interval H 2
Outdoor entering wet-bulb temperature, °F ............................................................... 1.5 .............................. 0.5
External resistance to airflow, inches of water .......................................................... 0.05 .............................. 5 0.02
Electrical voltage, % of rdg ........................................................................................ 2.0 .............................. 1.5
1 Seesection 1.2 of this appendix, Definitions.
2 Applies when the heat pump is in the heating mode, except for the first 10 minutes after termination of a defrost cycle.
3 Applies during a defrost cycle and during the first 10 minutes after the termination of a defrost cycle when the heat pump is operating in the
heating mode.
4 For heat pumps that turn off the indoor blower during the defrost cycle, the noted tolerance only applies during the 10 minute interval that fol-
lows defrost termination.
5 Only applies when testing non-ducted heat pumps.
* * * * * 4.1.3.1 * * * 4.1.4.1 * * *
4.1.1 * * * nj/N = fractional bin hours for the cooling * * * Evaluate the cooling mode cyclic
season; the ratio of the number of hours degradation factor CDc as specified in section
b. * * * Evaluate the cooling mode cyclic during the cooling season when the 3.5.3 of this appendix.
degradation factor CDc as specified in section outdoor temperature fell within the * * * * *
3.5.3 of this appendix. range represented by bin temperature Tj
* * * * * to the total number of hours in the Appendix M to Subpart B of Part 430—
cooling season, dimensionless. [Amended]
4.1.2.1 * * * Obtain the fractional bin hours for the
cooling season, nj/N, from Table 18. Use ■ 5. In the table below, for each section
c. * * * Evaluate the cooling mode cyclic
Equations 4.1.3–1 and 4.1.3–2, respectively, of appendix M to subpart B of part 430
degradation factor CDc as specified in section
to evaluate Q̇ck=1(Tj) and Ėck=1(Tj). Evaluate indicated in the left column, remove the
3.5.3 of this appendix.
the cooling mode cyclic degradation factor language indicated in the middle
* * * * * CDc as specified in section 3.5.3 of this column from wherever it appears in that
appendix. section, and add the language indicated
* * * * * in the right column.
Sections Remove Add
3.2.2.1, 3.2.3.a ... c
A default value of CD may be used in lieu of conducting the If the two optional tests are conducted but yield a tested CDc
cyclic test. The default value of CDc is 0.20. that exceeds the default CDc or if the two optional tests are
not conducted, assign CDc the default value of 0.20.
3.2.4.a ................ A default value for CDc may be used in lieu of conducting the If the two optional tests are conducted but yield a tested CDc
cyclic test. The default value of CDc is 0.25. that exceeds the default CDc or if the two optional tests are
not conducted, assign CDc the default value of 0.25.
3.6.1 ................... A default value for CDh may be used in lieu of conducting the If this optional test is conducted but yields a tested CDh that
cyclic test. The default value of CDh is 0.25. exceeds the default CDh or if the optional test is not con-
ducted, assign CDh the default value of 0.25.
3.6.2, 3.6.4.a ...... A default value for CDh may be used in lieu of conducting the If this optional test is conducted but yields a tested CDh that
cyclic. The default value of CDh is 0.25. exceeds the default CDh or if the optional test is not con-
ducted, assign CDh the default value of 0.25.
Appendix M to Subpart B of Part 430— [FR Doc. 2016–19227 Filed 8–17–16; 8:45 am] ACTION: Final rule.
[Amended] BILLING CODE 6450–01–P
SUMMARY: The FAA is amending its
■ 6. For each newly redesignated commercial space regulations governing
section of appendix M to subpart B of DEPARTMENT OF TRANSPORTATION reciprocal waivers of claims to require
part 430 in the first column, remove the that customers waive claims against all
cross reference sections in the middle Federal Aviation Administration the customers involved in a launch or
column, and add in their places, the reentry, including those signing a
cross reference sections in the right 14 CFR Part 440 different set of reciprocal waivers. Also,
column. [Docket No.: FAA–2014–1012; Amdt. No. customers of a customer contracting
440–4] directly with a licensee or permittee
Section Remove Add will not have to sign a waiver directly
RIN 2120–AK44 with the licensee or permittee, other
rmajette on DSK2TPTVN1PROD with RULES
4.1.3 .......................... 4.1.2.4 4.1.3.1 customers, or the FAA. The FAA is also
4.1.2.5 4.1.3.2 Reciprocal Waivers of Claims for
Licensed or Permitted Launch and adding an appendix to provide
4.1.2.6 4.1.3.3 permittees with an example of a Waiver
4.1.2.7 4.1.3.4 Reentry Activities
of Claims and Assumption of
4.1.4.3 ....................... 4.1.2.7 4.1.3.4 AGENCY:Federal Aviation Responsibility for Permitted Activities
Administration (FAA), DOT. with No Customer.
VerDate Sep<11>2014 18:35 Aug 17, 2016 Jkt 238001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\18AUR1.SGM 18AUR1](https://thefederalregister.org/doc/81_FR_55275/page/1.svg)
![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55117
confirm that ‘‘if a first-tier customer is a launch or reentry, including those ownership rights in the payload rather
a single entity representing a group of signing different reciprocal waivers. than the level of involvement in
persons, the licensee/permittee is Blue Origin also expressed concern developing the payload. For example, a
required to enter into a cross waiver of regarding how a licensee or permittee person may build a payload and sell it
claims only with a representative of the will determine who its customers are. to a company. The company may then
group as the first-tier customer.’’ 2 Specifically, Blue Origin pointed out place that payload on board a rocket.
An entity’s status as the that determining whether each party has The builder has no ownership rights in
representative of a group is not the an interest in the payload is the payload, and therefore would not be
determining factor as to whether or not complicated by the fact that ‘‘people a customer under § 440.3. The company
that entity is required to sign a have varying levels of involvement (e.g., who purchased, and therefore owns the
reciprocal waiver with the licensee or a student works an entire semester on a payload, would be a customer under
permittee and the FAA. Rather, a project, vs. one who works a few hours), § 440.3. The person facing financial
licensee or permittee is only required to or have left the group (e.g., some exposure for failing to properly identify
enter into a reciprocal waiver with students graduate prior to completion of these other non-signing customers
customers with whom it is in a a payload, and are replaced by other would be the first-tier customer.
contractual relationship. students).’’ 4
To determine the entities with which The FAA is not changing the B. Government Customers
it must execute a reciprocal waiver, the definition of ‘‘customer’’ under § 440.3 A Government customer need not sign
licensee or permittee should determine in this rulemaking. However, the burden a reciprocal waiver of claims because
what entities it has contracted with for of identifying part 440 customers does the FAA signs the reciprocal waiver of
the licensed or permitted activity who shift with this rule, not to the licensee claims on behalf of the Government.
also qualify as customers under 14 CFR or permittee as Blue Origin suggests, but Although, the proposed rule did not
440.3. Accordingly, if a licensee entered to the appropriate first-tier customer. mention Government customers, Harris
into a contract with a number of entities This is because under this rule a Corporation requested clarification on
for launch or reentry services, it would licensee or permittee is responsible for the treatment of Government-hosted
enter into reciprocal waivers with each implementing a reciprocal waiver of payload customers on commercial
of them. claims only with those customers with payloads launched pursuant to Chapter
Blue Origin provided a hypothetical whom it is in a direct contractual 509. The FAA makes no change based
scenario in which a school, university relationship. A first-tier customer, as a on this comment.
research lab, or other educational result of this rule, will be responsible Specifically, Harris asked whether the
institution represented a group of for implementing a reciprocal waiver of FAA would sign the waiver form on
students that contributed to the claims with each of its customers. behalf of a Government customer,
development of a payload. In this Although it is not changing the whether a Government customer could
hypothetical situation, the single entity definition of customer under § 440.3, be considered a part 440 customer, and
representing the group may be the only the FAA reiterates what it has said whether a Government customer’s
entity required to sign a reciprocal about the definition of customer in contractor would be considered a
waiver with the licensee or permittee previous rulemakings. In its 1996 contractor of the United States for
and the FAA. However, the hypothetical rulemaking, the FAA pointed out that it purposes of § 440.14(c). As the agency
entity would be the only entity required construes the term customer in has stated in previous rulemakings,
to sign the reciprocal waiver only if it proposed § 440.3 more broadly than just ‘‘[w]hen the licensee’s customer is a
was the only entity in a contractual ‘‘the party that actually contracts with U.S. Government agency, the agency is
relationship with the licensee or the commercial launch services treated the same as any
permittee, and therefore the only entity provider and prospective licensee.’’ 5 nongovernmental customer for purposes
who would qualify as a first-tier The 1996 NPRM provided the example of determining the appropriate amount
customer.3 In that case, the of a customer who had placed its of property insurance required of the
representative would be the only first- property on board the payload in order licensee and in terms of the U.S.
tier customer and, therefore, the only to receive an on-orbit service, such as Government’s waiver of claims or
party required to sign the reciprocal microgravity experiments, and stated property damage or less above the
waiver of claims with the licensee or that such an entity would be considered required amount of property insurance
permittee and the FAA. If, however, any a customer to the launch even though it under [51 U.S.C. 50914(b)(2)]. That is, a
other member of the group was also in did not procure the launch.6 In the final Government payload is not covered by
a direct contractual relationship with rule that resulted from the 1996 NPRM, the required Government property
the licensee or permittee and also met the FAA stated: ‘‘The definition of insurance and the United States
the FAA’s definition of customer under ‘customer’ is further modified in the Government agency-customer accepts
§ 440.3, that member would also be a final rule to include any person who responsibility for property damage to
first-tier customer and would also be places property on board a payload for the payload.’’ 8
required to sign a reciprocal waiver of the purpose of obtaining launch or Because the FAA signs on behalf of
claims with the licensee or permittee payload services . . . .’’ 7 the U.S. Government, any Government
and the FAA. It would not, however, The FAA’s definition of customer, customer would not separately sign any
have to sign with all other first-tier therefore, as applied to Blue Origin’s reciprocal waiver of claims. The
customers because this final rule hypothetical, would be based on designation as a part 440 customer does
ensures that customers waive claims not change a customer’s responsibilities
against all other customers involved in
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4 Blue Origin Comment at 2. under the reciprocal waivers of claims,
5 Financial Responsibility Requirements for it only affects with whom the customer
2 Blue Origin Comment at 2. Licensed Launch Activities, NPRM, 61 FR 38992, must sign a reciprocal waiver of claims.
3 The FAA assumes for purposes of this 39002 (July 25, 1996).
6 Financial Responsibility, 61 FR at 39002.
A Government customer’s status as a
hypothetical that the entity representing the group
meets the FAA’s definition of customer in 14 CFR 7 Financial Responsibility Requirements for first-tier or part 440 customer does not
440.3, by, for example, being the one who procures Licensed Launch Activities, Final Rule, 63 FR
the launch. 45592, 45607 (August 26, 1998). 8 Financial Responsibility, 61 FR at 39001.
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![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55119
contractors, subcontractors, and described in § 440.17(b) to waive claims against all the other parties involved in
customers. against part 440 customers and their the licensed activity.
(2) Because a first-tier customer must contractors and subcontractors. As stated previously, these
extend the requirements of the waiver, requirements levied on part 440
2. Extension of Reciprocal Waiver of
including the requirement to extend the customers also exist as a result of the
Claims to Part 440 Customers
waiver, to its customers, it follows that extension of the reciprocal waiver of
its customers will have the same In its comment, Harris also noted that claims that is required by § 440.17(b)(2),
obligation as a first-tier customer under the FAA overlooked explicitly requiring (b)(3), and (c)(1)(iii). By shifting the
the waiver. each part 440 customer to comply with responsibility to extend the reciprocal
(3) Therefore, because of the the reciprocal waiver of claims waiver of claims from the licensee or
extension of responsibilities, a first-tier requirements. Therefore, the FAA now permittee to the appropriate customer,
customer’s customers will be required, adds an explicit requirement in addition the burden to indemnify also shifts.
in turn, to extend the waiver to the extension of requirements Therefore, should a customer fail to
requirements to their contractors, provisions in order to clarify that each extend the reciprocal waiver of claims
subcontractors and customers. part 440 customer must enter into a requirements to its customer, and its
Additionally, § 440.17(b)(3) and reciprocal waiver of claims agreement. customer bring a claim against a party
(c)(1)(iii) explicitly require that each This marks a change from the regulatory involved in the launch, the customer
part 440 customer extends the text that the FAA originally proposed. who failed to extend would be required
reciprocal waiver of claims Harris commented that proposed to indemnify that party against its
requirements to its contractors and § 440.17(b) and (c) would not have customer’s claim. This represents a shift
subcontractors. ensured that part 440 customers waive from the old scheme in which all
Therefore, the FAA does not need to claims against the other parties included customers signed the reciprocal waiver
amend section 4(b) of the appendices to in the waiver scheme. Harris further of claims, and therefore no one would
ensure that part 440 customers extend asserted that the purpose behind the be required to indemnify against a
the waiver requirements to their waiver scheme is ‘‘(1) [t]o limit the total customer’s claim unless the licensee
contractors and subcontractors. Section universe of claims that might arise as a failed to identify a customer and ensure
440.17(b)(2) and (3) and (c)(1)(iii) and result of a launch; and (2) to eliminate that that customer signed the reciprocal
section 4(b) of the appendices already the necessity for all of these parties to waiver of claims.
require this. The FAA also disagrees obtain property and casualty insurance
with SpaceX’s suggestion to amend to protect against these claims.’’ 12 D. Removal of Permittees From
section 5(b) of the appendices to require Indemnification Scheme
The FAA agrees. Under Chapter 509
that a first-tier customer indemnify the
and the FAA’s current rules, the This rule does not change the
appropriate parties from and against
licensee or permittee is required to enter indemnification scheme created by 51
liability, loss, or damage arising out of
into a reciprocal waiver of claims with U.S.C. 50915. Chapter 509 provides that
any claim brought by its customer’s
all customers and their respective the United States Government shall pay
contractors and subcontractors.
contractors and subcontractors involved for a successful third party claim to the
Adopting SpaceX’s suggestion would
in launch or reentry services. In other extent the claim exceeds the insurance
place an additional burden of
words, each customer must waive and coverage required by statute but does
indemnification on a first-tier customer
release claims, assume responsibility, not exceed the statutory limit for such
that did not previously exist in part 440.
hold harmless, and indemnify other coverage, provided Congress
Previous part 440 appendices required
parties identified in the waiver. In the appropriates the funds.13 Chapter 509
only that a first-tier customer indemnify
NPRM, the FAA proposed to require also lists the persons against whom the
the appropriate parties from and against
only first-tier customers to sign a claim may be brought in order to qualify
liability, loss, or damage arising out of
reciprocal waiver of claims with the for this coverage.14 This list includes
certain claims brought by its
FAA and the licensee or permittee. By licensees, but does not include
contractors, subcontractors, and
separating first-tier customers from part permittees. Therefore, Congress will not
employees. SpaceX’s proposed language
440 customers, the proposed rule did appropriate funds for a third party claim
would additionally require a first-tier
not explicitly require part 440 against a permittee that exceeds the
customer to indemnify from claims
customers to waive and release claims, insurance requirements in Chapter 509.
brought by its customer’s contractors,
assume responsibility, hold harmless,
subcontractors, and employees. As Although it received no comments on
and indemnify other parties identified
explained above, a first-tier customer is the issue, the FAA has identified an
in the waiver. Instead, these
required to extend the reciprocal waiver error in the proposed rule that it
requirements were implied by the
of claims requirements to its customers. corrects with the final rule. In the
extension of requirements in which a
As a result of this extension, a first-tier proposed rule, the FAA would have
first-tier customer is required to extend
customer’s customer, rather than the included permittees in the
the reciprocal waiver of claims
first-tier customer himself, is required to indemnification scheme reserved by
requirements to its customers,
indemnify against certain claims statute for licensees only. Because this
contractors, and subcontractors. Because
brought by its contractors, error would create a conflict with the
commenters expressed some confusion
subcontractors, and employees. FAA’s statutory authority, which the
about the requirements, the FAA
Lastly, Harris pointed out that the FAA did not intend, the FAA has
amends § 440.17(b) and adds
absence of part 440 customers and their amended the regulatory text in this final
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§ 440.17(c)(1)(iii)(D) to explicitly require
contractors and subcontractors in rule to comply with Chapter 509 by
that part 440 customers waive claims
proposed § 440.17(b) exposes these removing permittees from the section
parties to liability that represents a 12 Commercial Space Launch Act Amendments of
50915 indemnification scheme.
departure from Chapter 509. The FAA 1988, Report of the Senate Committee on
agrees, and this rule requires parties to Commerce, Science, and Transportation on H.R. 13 51 U.S.C. 50915(a)(1).
the reciprocal waiver of claims 4399, S. Rep. No. 100–593 at 14 (Oct. 7, 1988). 14 51 U.S.C. 50915(a)(3)(A).
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resulting from licensed or permitted The reciprocal waiver of claims must be for any property damage they sustain
activities, regardless of fault; and in the form set forth in appendix D of and for any bodily injury or property
(iv) Hold harmless and indemnify the this part, or in a form that otherwise damage sustained by their own
United States and its servants, agents, provides all the same obligations and employees, resulting from licensed
subsidiaries, employees and assignees, benefits. activities, regardless of fault; and
or any of them, from and against (1) The reciprocal waiver of claims (v) Extend the requirements of the
liability, loss, or damage arising out of must provide that each crew member: waiver and release of claims, and the
claims brought by anyone for property (i) Waive and release claims he or she assumption of responsibility to its
damage or bodily injury sustained by may have against the United States, and contractors and subcontractors by
the space flight participant, resulting against each of its contractors and requiring them to waive and release all
from licensed or permitted activities. subcontractors, for bodily injury or claims they may have against the crew
(2) The reciprocal waiver of claims property damage sustained by the crew member and to agree to be responsible,
must provide that the United States: member, resulting from licensed or for any property damage they sustain,
(i) Waive and release claims it may permitted activities, regardless of fault; resulting from permitted activities,
have against the space flight participant (ii) Assume responsibility for bodily regardless of fault.
for property damage it sustains, and for injury or property damage, sustained by (f) Any waiver, release, assumption of
bodily injury or property damage the crew member, resulting from responsibility or agreement to hold
sustained by its own employees, licensed or permitted activities, harmless and indemnify pursuant to
resulting from licensed or permitted regardless of fault; this section does not apply to claims for
activities, regardless of fault; (iii) Hold harmless the United States, bodily injury or property damage
(ii) Assume responsibility for property and its contractors and subcontractors, resulting from willful misconduct of any
damage it sustains, and for bodily injury for bodily injury or property damage, of the parties to the reciprocal waiver of
or property damage sustained by its own sustained by the crew member, resulting claims, the contractors and
employees, resulting from licensed from licensed or permitted activities, subcontractors of any of the parties to
activities, regardless of fault, to the regardless of fault; and the reciprocal waiver of claims, and in
extent that claims it would otherwise (iv) Hold harmless and indemnify the the case of licensee or permittee and
have for such damage or injury exceed United States and its agencies, servants, customers and the contractors and
the amount of insurance or agents, subsidiaries, employees and subcontractors of each of them, the
demonstration of financial assignees, or any of them, from and directors, officers, agents and employees
responsibility required under § 440.9(c) against liability, loss, or damage arising of any of the foregoing, and in the case
and (e), respectively; out of claims brought by anyone for of the United States, its agents.
(iii) Assume responsibility for property damage or bodily injury ■ 4. Revise appendix B to part 440 to
property damage it sustains, resulting sustained by the crew member, resulting read as follows:
from permitted activities, regardless of from licensed or permitted activities.
fault, to the extent that claims it would (2) The reciprocal waiver of claims Appendix B to Part 440—Agreement for
otherwise have for such damage exceed must provide that the United States: Waiver of Claims and Assumption of
the amount of insurance or (i) Waive and release claims it may Responsibility for Licensed Activities
demonstration of financial have against the crew member for Part 1—Waiver of Claims and Assumption of
responsibility required under § 440.9(e); property damage it sustains, and for Responsibility for Licensed Launch,
(iv) Extend the requirements of the bodily injury, including death, or Including Suborbital Launch
waiver and release of claims, and the property damage sustained by its own Subpart A—Waiver of Claims and
assumption of responsibility to its employees, resulting from licensed or Assumption of Responsibility for Licensed
contractors and subcontractors by permitted activities, regardless of fault; Launch, Including Suborbital Launch, With
requiring them to waive and release all (ii) Assume responsibility for property One Customer
claims they may have against the space damage it sustains, and for bodily injury This agreement is entered into thisllday
flight participant, and to agree to be or property damage sustained by its own ofllll, by and among [Licensee] (the
responsible, for any property damage employees, resulting from licensed ‘‘Licensee’’), [Customer] (the ‘‘Customer’’)
they sustain and for any bodily injury or activities, regardless of fault, to the and the Federal Aviation Administration of
property damage sustained by their own extent that claims it would otherwise the Department of Transportation, on behalf
employees, resulting from licensed have for such damage or injury exceed of the United States Government
activities, regardless of fault; and the amount of insurance or (collectively, the ‘‘Parties’’), to implement the
provisions of § 440.17(c) of the Commercial
(v) Extend the requirements of the demonstration of financial Space Transportation Licensing Regulations,
waiver and release of claims, and the responsibility required under § 440.9(c) 14 CFR Ch. III (the ‘‘Regulations’’). This
assumption of responsibility to its and (e), respectively; agreement applies to the launch of [Payload]
contractors and subcontractors by (iii) Assume responsibility for payload on a [Launch Vehicle] vehicle at
requiring them to waive and release all property damage it sustains, resulting [Location of Launch Site]. In consideration of
claims they may have against the space from permitted activities, regardless of the mutual releases and promises contained
flight participant, and to agree to be fault, to the extent that claims it would herein, the Parties hereby agree as follows:
responsible, for any property damage otherwise have for such damage exceed 1. Definitions
they sustain, resulting from permitted the amount of insurance or Contractors and Subcontractors means
activities, regardless of fault. demonstration of financial entities defined by § 440.3 of the Regulations.
(e) For each licensed or permitted responsibility required under § 440.9(e); Customer means the above-named
activity in which the United States or its (iv) Extend the requirements of the Customer.
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contractors and subcontractors is waiver and release of claims, and the Part 440 Customer means a customer
defined by § 440.3 of the Regulations, other
involved, the Federal Aviation assumption of responsibility to its
than the above-named Customer.
Administration of the Department of contractors and subcontractors by License means License No.llissued
Transportation and each crew member requiring them to waive and release all onllll, by the Associate Administrator
must enter into or have in place a claims they may have against the crew for Commercial Space Transportation,
reciprocal waiver of claims agreement. member and to agree to be responsible, Federal Aviation Administration, Department
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7. Miscellaneous Part 440 Customer means a customer of insurance or demonstration of financial
(a) Nothing contained herein shall be defined by § 440.3 of the Regulations, other responsibility required under § 440.9(c) and
construed as a waiver or release by Licensee, than the above-named Customer. (e), respectively, of the Regulations.
Customer or the United States of any claim License means License No.llissued 4. Extension of Assumption of Responsibility
by an employee of the Licensee, Customer or onllll, by the Associate Administrator and Waiver and Release of Claims
the United States, respectively, including a for Commercial Space Transportation,
Federal Aviation Administration, Department (a) Licensee shall extend the requirements
member of the Armed Forces of the United of the waiver and release of claims, and the
States, for Bodily Injury or Property Damage, of Transportation, to the Licensee, including
all license orders issued in connection with assumption of responsibility, hold harmless,
resulting from Licensed Activities. and indemnification, as set forth in
(b) Notwithstanding any provision of this the License.
Licensee means the Licensee and any paragraphs 2(a) and 3(a), respectively, to its
Agreement to the contrary, any waiver, Contractors and Subcontractors by requiring
release, assumption of responsibility or transferee of the Licensee under 51 U.S.C.
Subtitle V, ch. 509. them to waive and release all claims they
agreement to hold harmless and indemnify
United States means the United States and may have against each Customer, the United
herein shall not apply to claims for Bodily
its agencies involved in Licensed Activities. States, any Part 440 Customer, and each of
Injury or Property Damage resulting from
Except as otherwise defined herein, terms their respective Contractors and
willful misconduct of any of the Parties, the
used in this Agreement and defined in 51 Subcontractors, and to agree to be
Contractors and Subcontractors of any of the
U.S.C. Subtitle V, ch. 509—Commercial responsible, for Property Damage they
Parties, any Part 440 Customer, the
Space Launch Activities, or in the sustain and to be responsible, hold harmless
Contractors and Subcontractors of any Part
Regulations, shall have the same meaning as and indemnify each Customer, the United
440 Customer, and in the case of Licensee,
contained in 51 U.S.C. Subtitle V, ch. 509, or States, any Part 440 Customer, and each of
Customer, any Part 440 Customer, and the
Contractors and Subcontractors of each of the Regulations, respectively. their respective Contractors and
them, the directors, officers, agents and Subcontractors, for Bodily Injury or Property
2. Waiver and Release of Claims Damage sustained by their own employees,
employees of any of the foregoing, and in the
case of the United States, its agents. (a) Licensee hereby waives and releases resulting from Licensed Activities, regardless
(c) This Agreement shall be governed by claims it may have against each Customer, of fault.
and construed in accordance with United the United States, any Part 440 Customer, (b) Each Customer shall extend the
States Federal law. and each of their respective Contractors and requirements of the waiver and release of
In witness whereof, the Parties to this Subcontractors, for Property Damage it claims, and the assumption of responsibility,
Agreement have caused the Agreement to be sustains and for Bodily Injury or Property hold harmless, and indemnification, as set
duly executed by their respective duly Damage sustained by its own employees, forth in paragraphs 2(b) and 3(a),
authorized representatives as of the date resulting from Licensed Activities, regardless respectively, to its customers, Contractors,
written above. of fault. and Subcontractors, by requiring them to
(b) Each Customer hereby waives and waive and release all claims they may have
Licensee releases claims it may have against Licensee, against Licensee, the United States, and any
By: lllllllllllllllllll the United States, any other customer, and other customer, and each of their respective
Its: lllllllllllllllllll each of their respective Contractors and Contractors and Subcontractors, and to agree
Customer Subcontractors for Property Damage it to be responsible, for Property Damage they
sustains and for Bodily Injury or Property sustain and to be responsible, hold harmless
By: lllllllllllllllllll Damage sustained by its own employees, and indemnify Licensee, the United States,
Its: lllllllllllllllllll resulting from Licensed Activities, regardless and any other customer, and each of their
Federal Aviation Administration of the of fault. respective Contractors and Subcontractors,
Department of Transportation on Behalf of (c) The United States hereby waives and for Bodily Injury or Property Damage
the United States Government releases claims it may have against Licensee, sustained by their own employees, resulting
By: lllllllllllllllllll each Customer, any Part 440 Customer, and from Licensed Activities, regardless of fault.
Its: lllllllllllllllllll each of their respective Contractors and (c) The United States shall extend the
Subcontractors, for Property Damage it requirements of the waiver and release of
Associate Administrator for Commercial sustains, and for Bodily Injury or Property claims, and the assumption of responsibility
Space Transportation Damage sustained by its own employees, as set forth in paragraphs 2(c) and 3(b),
Subpart B—Waiver of Claims and resulting from Licensed Activities, regardless respectively, to its Contractors and
Assumption of Responsibility for Licensed of fault, to the extent that claims it would Subcontractors by requiring them to waive
Launch, Including Suborbital Launch, With otherwise have for such damage or injury and release all claims they may have against
More Than One Customer exceed the amount of insurance or Licensee, each Customer, any Part 440
demonstration of financial responsibility Customer, and each of their respective
This agreement is entered into thisllday
required under § 440.9(c) and (e), Contractors and Subcontractors, and to agree
ofllll, by and among [Licensee] (the
respectively, of the Regulations. to be responsible, for any Property Damage
‘‘Licensee’’); [List of Customers]; (with [List
3. Assumption of Responsibility they sustain and for any Bodily Injury or
of Customers] hereinafter referred to in their
individual capacity as ‘‘Customer’’); and the Property Damage sustained by their own
(a) Licensee and each Customer shall each employees, resulting from Licensed
Federal Aviation Administration of the be responsible for Property Damage it
Department of Transportation, on behalf of Activities, regardless of fault, to the extent
sustains and for Bodily Injury or Property that claims they would otherwise have for
the United States Government (collectively, Damage sustained by its own employees,
the ‘‘Parties’’), to implement the provisions of such damage or injury exceed the amount of
resulting from Licensed Activities, regardless insurance or demonstration of financial
§ 440.17(c) of the Commercial Space of fault. Licensee and each Customer shall
Transportation Licensing Regulations, 14 responsibility required under § 440.9(c) and
each hold harmless and indemnify each (e), respectively, of the Regulations.
CFR Ch. III (the ‘‘Regulations’’). This other, the United States, any other customer,
agreement applies to the launch of [Payload] and the Contractors and Subcontractors of 5. Indemnification
payload on a [Launch Vehicle] vehicle at (a) Licensee shall hold harmless and
each, for Bodily Injury or Property Damage
[Location of Launch Site].
sustained by its own employees, resulting indemnify each Customer and its directors,
In consideration of the mutual releases and
from Licensed Activities, regardless of fault. officers, servants, agents, subsidiaries,
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promises contained herein, the Parties hereby
(b) The United States shall be responsible employees and assignees, or any of them; the
agree as follows:
for Property Damage it sustains, and for United States and its agencies, servants,
1. Definitions Bodily Injury or Property Damage sustained agents, subsidiaries, employees and
Contractors and Subcontractors means by its own employees, resulting from assignees, or any of them; and any part 440
entities defined by § 440.3 of the Regulations. Licensed Activities, regardless of fault, to the customer and its directors, officers, servants,
Customer means each above-named extent that claims it would otherwise have agents, subsidiaries, employees and
Customer. for such damage or injury exceed the amount assignees, or any of them, from and against
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![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55127
liability, loss or damage arising out of claims amount, and are payable pursuant to the the Commercial Space Transportation
that Licensee’s Contractors and provisions of 51 U.S.C. 50915 and § 440.19 of Licensing Regulations, 14 CFR Ch. III (the
Subcontractors may have for Property the Regulations; or (iv) Licensee has no ‘‘Regulations’’). This agreement applies to the
Damage sustained by them and for Bodily liability for claims exceeding $1,500,000,000 reentry of the [Payload] payload on a
Injury or Property Damage sustained by their (as adjusted for inflation after January 1, [Reentry Vehicle] vehicle.
employees, resulting from Licensed 1989) above the amount of insurance or In consideration of the mutual releases and
Activities and arising out of the indemnifying demonstration of financial responsibility promises contained herein, the Parties hereby
party’s failure to implement properly the required under § 440.9(c) of the Regulations. agree as follows:
waiver requirement. 7. Miscellaneous 1. Definitions
(b) Each Customer shall hold harmless and
indemnify Licensee and its directors, officers, (a) Nothing contained herein shall be Contractors and Subcontractors means
servants, agents, subsidiaries, employees and construed as a waiver or release by Licensee, entities defined by § 440.3 of the Regulations.
assignees, or any of them; the United States any Customer or the United States of any Customer means the above-named
and its agencies, servants, agents, claim by an employee of the Licensee, any Customer.
subsidiaries, employees and assignees, or any Customer or the United States, respectively, Part 440 Customer means a customer
including a member of the Armed Forces of defined by § 440.3 of the Regulations, other
of them; and any other customer and its
the United States, for Bodily Injury or than the above named Customer.
directors, officers, servants, agents,
subsidiaries, employees and assignees, or any
Property Damage, resulting from Licensed License means License No. ll issued on
of them, from and against liability, loss or
Activities. llll, by the Associate Administrator for
(b) Notwithstanding any provision of this Commercial Space Transportation, Federal
damage arising out of claims that each
Agreement to the contrary, any waiver, Aviation Administration, Department of
Customer’s Contractors, Subcontractors, or
release, assumption of responsibility or Transportation, to the Licensee, including all
customers, may have for Property Damage
agreement to hold harmless and indemnify license orders issued in connection with the
sustained by them and for Bodily Injury or
herein shall not apply to claims for Bodily License.
Property Damage sustained by their
Injury or Property Damage resulting from Licensee means the Licensee and any
employees, resulting from Licensed
willful misconduct of any of the Parties, the transferee of the Licensee under 51 U.S.C.
Activities and arising out of the indemnifying
Contractors and Subcontractors of any of the Subtitle V, ch. 509.
party’s failure to implement properly the
Parties, any Part 440 Customer, the United States means the United States and
waiver requirement.
Contractors and Subcontractors of any Part its agencies involved in Licensed Activities.
(c) To the extent provided in advance in an
440 Customer, and in the case of Licensee, Except as otherwise defined herein, terms
appropriations law or to the extent there is
each Customer, any Part 440 Customer, and used in this Agreement and defined in 51
enacted additional legislative authority
the Contractors and Subcontractors of each of U.S.C. Subtitle V, ch. 509—Commercial
providing for the payment of claims, the
them, the directors, officers, agents and Space Launch Activities, or in the
United States shall hold harmless and
employees of any of the foregoing, and in the Regulations, shall have the same meaning as
indemnify Licensee, each Customer, any Part
case of the United States, its agents. contained in 51 U.S.C. Subtitle V, ch. 509, or
440 Customer, and their respective directors,
(c) References herein to Customer shall the Regulations, respectively.
officers, servants, agents, subsidiaries,
apply to, and be deemed to include, each
employees and assignees, or any of them, 2. Waiver and Release of Claims
such customer severally and not jointly.
from and against liability, loss or damage
(d) This Agreement shall be governed by (a) Licensee hereby waives and releases
arising out of claims that Contractors and
and construed in accordance with United claims it may have against Customer, the
Subcontractors of the United States may have
States Federal law. United States, any Part 440 Customer, and
for Property Damage sustained by them, and
In witness whereof, the Parties to this each of their respective Contractors and
for Bodily Injury or Property Damage
Agreement have caused the Agreement to be Subcontractors, for Property Damage it
sustained by their employees, resulting from
duly executed by their respective duly sustains and for Bodily Injury or Property
Licensed Activities and arising out of the
authorized representatives as of the date Damage sustained by its own employees,
indemnifying party’s failure to implement
written above. resulting from Licensed Activities, regardless
properly the waiver requirement, to the
extent that claims they would otherwise have Licensee of fault.
for such damage or injury exceed the amount (b) Customer hereby waives and releases
By: lllllllllllllllllll claims it may have against Licensee, the
of insurance or demonstration of financial Its: lllllllllllllllllll
responsibility required under § 440.9(c) and United States, any other customer, and each
Customer 1 of their respective Contractors and
(e), respectively, of the Regulations.
By: lllllllllllllllllll Subcontractors, for Property Damage it
6. Assurances Under 51 U.S.C. 50914(e)
Its: lllllllllllllllllll sustains and for Bodily Injury or Property
Notwithstanding any provision of this [Signature lines for each additional customer] Damage sustained by its own employees,
Agreement to the contrary, Licensee shall resulting from Licensed Activities, regardless
hold harmless and indemnify the United Federal Aviation Administration of the of fault.
States and its agencies, servants, agents, Department of Transportation on Behalf of (c) The United States hereby waives and
employees and assignees, or any of them, the United States Government releases claims it may have against Licensee,
from and against liability, loss or damage By: lllllllllllllllllll Customer, any Part 440 Customer, and each
arising out of claims for Bodily Injury or Its: lllllllllllllllllll of their respective Contractors and
Property Damage, resulting from Licensed Subcontractors, for Property Damage it
Associate Administrator for Commercial
Activities, regardless of fault, except to the sustains, and for Bodily Injury or Property
Space Transportation
extent that: (i) As provided in paragraph 7(b) Damage sustained by its own employees,
of this Agreement, claims result from willful Part 2—Waiver of Claims and Assumption of resulting from Licensed Activities, regardless
misconduct of the United States or its agents; Responsibility for Licensed Reentry of fault, to the extent that claims it would
(ii) claims for Property Damage sustained by otherwise have for such damage or injury
the United States or its Contractors and Subpart A—Waiver of Claims and
Assumption of Responsibility for Licensed exceed the amount of insurance or
Subcontractors exceed the amount of demonstration of financial responsibility
insurance or demonstration of financial Reentry With One Customer
required under § 440.9(c) and (e),
responsibility required under § 440.9(e) of This Agreement is entered into this ll respectively, of the Regulations.
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the Regulations; (iii) claims by a Third Party day of llll, by and among [Licensee]
for Bodily Injury or Property Damage exceed (the ‘‘Licensee’’), [Customer] (the 3. Assumption of Responsibility
the amount of insurance or demonstration of ‘‘Customer’’), and the Federal Aviation (a) Licensee and Customer shall each be
financial responsibility required under Administration of the Department of responsible for Property Damage it sustains
§ 440.9(c) of the Regulations, and do not Transportation, on behalf of the United States and for Bodily Injury or Property Damage
exceed $1,500,000,000 (as adjusted for Government (collectively, the ‘‘Parties’’), to sustained by its own employees, resulting
inflation after January 1, 1989) above such implement the provisions of § 440.17(c) of from Licensed Activities, regardless of fault.
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Licensee and Customer shall each hold required under § 440.9(c) and (e), misconduct of the United States or its agents;
harmless and indemnify each other, the respectively, of the Regulations. (ii) claims for Property Damage sustained by
United States, any other customer, and the 5. Indemnification the United States or its Contractors and
Contractors and Subcontractors of each, for Subcontractors exceed the amount of
Bodily Injury or Property Damage sustained (a) Licensee shall hold harmless and insurance or demonstration of financial
by its own employees, resulting from indemnify Customer and its directors, responsibility required under § 440.9(e) of
officers, servants, agents, subsidiaries, the Regulations; (iii) claims by a Third Party
Licensed Activities, regardless of fault.
employees and assignees, or any of them; the for Bodily Injury or Property Damage exceed
(b) The United States shall be responsible
United States and its agencies, servants, the amount of insurance or demonstration of
for Property Damage it sustains, and for
agents, subsidiaries, employees and financial responsibility required under
Bodily Injury or Property Damage sustained
assignees, or any of them; and any Part 440 § 440.9(c) of the Regulations, and do not
by its own employees, resulting from Customer and its directors, officers, servants,
Licensed Activities, regardless of fault, to the exceed $1,500,000,000 (as adjusted for
agents, subsidiaries, employees and inflation after January 1, 1989) above such
extent that claims it would otherwise have assignees, or any of them from and against
for such damage or injury exceed the amount amount, and are payable pursuant to the
liability, loss or damage arising out of claims provisions of 51 U.S.C. 50915 and § 440.19 of
of insurance or demonstration of financial that Licensee’s Contractors and
responsibility required under § 440.9(c) and the Regulations; or (iv) Licensee has no
Subcontractors may have for Property liability for claims exceeding $1,500,000,000
(e) of the Regulations. Damage sustained by them and for Bodily (as adjusted for inflation after January 1,
4. Extension of Assumption of Responsibility Injury or Property Damage sustained by their 1989) above the amount of insurance or
and Waiver and Release of Claims employees, resulting from Licensed demonstration of financial responsibility
(a) Licensee shall extend the requirements Activities and arising out of the indemnifying required under § 440.9(c) of the Regulations.
of the waiver and release of claims, and the party’s failure to implement properly the
waiver requirement. 7. Miscellaneous
assumption of responsibility, hold harmless,
and indemnification, as set forth in (b) Customer shall hold harmless and (a) Nothing contained herein shall be
paragraphs 2(a) and 3(a), respectively, to its indemnify Licensee and its directors, officers, construed as a waiver or release by Licensee,
Contractors and Subcontractors by requiring servants, agents, subsidiaries, employees and Customer or the United States of any claim
them to waive and release all claims they assignees, or any of them; the United States by an employee of the Licensee, Customer or
may have against Customer, the United and its agencies, servants, agents, the United States, respectively, including a
States, any Part 440 Customer, and each of subsidiaries, employees and assignees, or any member of the Armed Forces of the United
their respective Contractors and of them; and any other customer and its States, for Bodily Injury or Property Damage,
directors, officers, servants, agents, resulting from Licensed Activities.
Subcontractors, and to agree to be
subsidiaries, employees and assignees, or any (b) Notwithstanding any provision of this
responsible, for Property Damage they
of them from and against liability, loss or Agreement to the contrary, any waiver,
sustain and to be responsible, hold harmless
damage arising out of claims that Customer’s release, assumption of responsibility or
and indemnify Customer, the United States,
Contractors, Subcontractors, or customers agreement to hold harmless and indemnify
any Part 440 Customer, and each of their
may have for Property Damage sustained by herein shall not apply to claims for Bodily
respective Contractors and Subcontractors,
them and for Bodily Injury or Property Injury or Property Damage resulting from
for Bodily Injury or Property Damage
Damage sustained by their employees, willful misconduct of any of the Parties, the
sustained by their own employees, resulting
resulting from Licensed Activities and arising Contractors and Subcontractors of any of the
from Licensed Activities, regardless of fault.
out of the indemnifying party’s failure to Parties, any Part 440 Customer, the
(b) Customer shall extend the requirements implement properly the waiver requirement.
of the waiver and release of claims, and the Contractors and Subcontractors of any Part
(c) To the extent provided in advance in an 440 Customer, and in the case of Licensee,
assumption of responsibility, hold harmless, appropriations law or to the extent there is
and indemnification, as set forth in Customer, any Part 440 Customer, and the
enacted additional legislative authority Contractors and Subcontractors of each of
paragraphs 2(b) and 3(a), respectively, to its providing for the payment of claims, the
customers, Contractors, and Subcontractors, them, the directors, officers, agents and
United States shall hold harmless and employees of any of the foregoing, and in the
by requiring them to waive and release all indemnify Licensee, Customer, any Part 440
claims they may have against Licensee, the case of the United States, its agents.
Customer, and their respective directors, (c) This Agreement shall be governed by
United States, and any other customer, and officers, servants, agents, subsidiaries,
each of their respective Contractors and and construed in accordance with United
employees and assignees, or any of them, States Federal law.
Subcontractors, and to agree to be from and against liability, loss or damage
responsible, for Property Damage they In Witness Whereof, the Parties to this
arising out of claims that Contractors and Agreement have caused the Agreement to be
sustain and to be responsible, hold harmless Subcontractors of the United States may have
and indemnify Licensee, the United States, duly executed by their respective duly
for Property Damage sustained by them, and authorized representatives as of the date
and any other customer, and each of their for Bodily Injury or Property Damage
respective Contractors and Subcontractors, written above.
sustained by their employees, resulting from
for Bodily Injury or Property Damage Licensed Activities and arising out of the Licensee
sustained by their own employees, resulting indemnifying party’s failure to implement By: lllllllllllllllllll
from Licensed Activities, regardless of fault. properly the waiver requirement, to the Its: lllllllllllllllllll
(c) The United States shall extend the extent that claims they would otherwise have
requirements of the waiver and release of Customer
for such damage or injury exceed the amount
claims, and the assumption of responsibility of insurance or demonstration of financial By: lllllllllllllllllll
as set forth in paragraphs 2(c) and 3(b), responsibility required under § 440.9(c) and Its: lllllllllllllllllll
respectively, to its Contractors and (e) of the Regulations. Federal Aviation Administration of the
Subcontractors by requiring them to waive Department of Transportation on Behalf of
and release all claims they may have against 6. Assurances Under 51 U.S.C. 50914(e)
the United States Government
Licensee, Customer, any Part 440 Customer, Notwithstanding any provision of this
and each of their respective Contractors and Agreement to the contrary, Licensee shall By: lllllllllllllllllll
Subcontractors, and to agree to be hold harmless and indemnify the United Its: lllllllllllllllllll
responsible, for any Property Damage they States and its agencies, servants, agents, Associate Administrator for Commercial
rmajette on DSK2TPTVN1PROD with RULES
sustain and for any Bodily Injury or Property employees and assignees, or any of them, Space Transportation
Damage sustained by their own employees, from and against liability, loss or damage
resulting from Licensed Activities, regardless arising out of claims for Bodily Injury or Subpart B—Waiver of Claims and
of fault, to the extent that claims they would Property Damage, resulting from Licensed Assumption of Responsibility for Licensed
otherwise have for such damage or injury Activities, regardless of fault, except to the Reentry With More Than One Customer
exceed the amount of insurance or extent that: (i) As provided in paragraph 7(b) This agreement is entered into this ll
demonstration of financial responsibility of this Agreement, claims result from willful day of llll, by and among [Licensee]
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![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55129
(the ‘‘Licensee’’); [List of Customers] (with 3. Assumption of Responsibility they sustain and for any Bodily Injury or
[List of Customers] hereinafter referred to in (a) Licensee and each Customer shall each Property Damage sustained by their own
their individual capacity as ‘‘Customer’’); and be responsible for Property Damage it employees, resulting from Licensed
the Federal Aviation Administration of the sustains and for Bodily Injury or Property Activities, regardless of fault, to the extent
Department of Transportation, on behalf of Damage sustained by its own employees, that claims they would otherwise have for
the United States Government (collectively, resulting from Licensed Activities, regardless such damage or injury exceed the amount of
the ‘‘Parties’’), to implement the provisions of of fault. Licensee and each Customer shall insurance or demonstration of financial
§ 440.17(c) of the Commercial Space each hold harmless and indemnify each responsibility required under § 440.9(c) and
Transportation Licensing Regulations, 14 other, the United States, any other customer, (e), respectively, of the Regulations.
CFR Ch. III (the ‘‘Regulations’’). This and the Contractors and Subcontractors of 5. Indemnification
agreement applies to the reentry of [Payload] each, for Bodily Injury or Property Damage
payload on a [Reentry Vehicle] vehicle. (a) Licensee shall hold harmless and
sustained by its own employees, resulting indemnify each Customer and its directors,
In consideration of the mutual releases and
from Licensed Activities, regardless of fault. officers, servants, agents, subsidiaries,
promises contained herein, the Parties hereby
(b) The United States shall be responsible employees and assignees, or any of them; the
agree as follows:
for Property Damage it sustains, and for United States and its agencies, servants,
1. Definitions Bodily Injury or Property Damage sustained agents, subsidiaries, employees and
Contractors and Subcontractors means by its own employees, resulting from assignees, or any of them; and any Part 440
entities described in § 440.3 of the Licensed Activities, regardless of fault, to the Customer and its directors, officers, servants,
Regulations. extent that claims it would otherwise have agents, subsidiaries, employees and
Customer means each above-named for such damage or injury exceed the amount assignees, or any of them, from and against
Customer. of insurance or demonstration of financial liability, loss or damage arising out of claims
Part 440 Customer means a customer responsibility required under § 440.9(c) and that Licensee’s Contractors and
defined by § 440.3 of the Regulations, other (e), respectively, of the Regulations. Subcontractors may have for Property
than the above-named customer. 4. Extension of Assumption of Responsibility Damage sustained by them and for Bodily
License means License No. ll issued on and Waiver and Release of Claims Injury or Property Damage sustained by their
llll, by the Associate Administrator for employees, resulting from Licensed
Commercial Space Transportation, Federal (a) Licensee shall extend the requirements
of the waiver and release of claims, and the Activities and arising out of the indemnifying
Aviation Administration, Department of party’s failure to implement properly the
Transportation, to the Licensee, including all assumption of responsibility, hold harmless,
and indemnification, as set forth in waiver requirement.
license orders issued in connection with the (b) Each Customer shall hold harmless and
License. paragraphs 2(a) and 3(a), respectively, to its
indemnify Licensee and its directors, officers,
Licensee means the Licensee and any Contractors and Subcontractors by requiring
servants, agents, subsidiaries, employees and
transferee of the Licensee under 51 U.S.C. them to waive and release all claims they
assignees, or any of them; and the United
Subtitle V, ch. 509. may have against each Customer, the United
States and any other customer as defined by
United States means the United States and States, any Part 440 Customer, and each of
§ 440.3 its agencies, servants, agents,
its agencies involved in Licensed Activities. their respective Contractors and
subsidiaries, employees and assignees, or any
Except as otherwise defined herein, terms Subcontractors, and to agree to be
of them; and any other customer and its
used in this Agreement and defined in 51 responsible, for Property Damage they
directors, officers, servants, agents,
U.S.C. Subtitle V, ch. 509—Commercial sustain and to be responsible, hold harmless
subsidiaries, employees and assignees, or any
Space Launch Activities, or in the and indemnify each Customer, the United of them, from and against liability, loss or
Regulations, shall have the same meaning as States, any Part 440 Customer, and each of damage arising out of claims that each
contained in 51 U.S.C. Subtitle V, ch. 509, or their respective Contractors and Customer’s Contractors, Subcontractors, and
the Regulations, respectively. Subcontractors, for Bodily Injury or Property customers, may have for Property Damage
2. Waiver and Release of Claims Damage sustained by their own employees, sustained by them and for Bodily Injury or
resulting from Licensed Activities, regardless Property Damage sustained by their
(a) Licensee hereby waives and releases of fault.
claims it may have against each Customer, employees, resulting from Licensed
(b) Each Customer shall extend the Activities and arising out of the indemnifying
the United States, any Part 440 Customer,
requirements of the waiver and release of party’s failure to implement properly the
and each of their respective Contractors and
claims, and the assumption of responsibility, waiver requirement.
Subcontractors, for Property Damage it
hold harmless, and indemnification, as set (c) To the extent provided in advance in an
sustains and for Bodily Injury or Property
forth in paragraphs 2(b) and 3(a), appropriations law or to the extent there is
Damage sustained by its own employees,
resulting from Licensed Activities, regardless respectively, to its customers, Contractors, enacted additional legislative authority
of fault. and Subcontractors, by requiring them to providing for the payment of claims, the
(b) Each Customer hereby waives and waive and release all claims they may have United States shall hold harmless and
releases claims it may have against Licensee, against Licensee, the United States, and any indemnify Licensee, each Customer, any Part
the United States, any other customer, and other customer, and each of their respective 440 Customer, and their respective directors,
each of their respective Contractors and Contractors and Subcontractors, and to agree officers, servants, agents, subsidiaries,
Subcontractors, for Property Damage it to be responsible, for Property Damage they employees and assignees, or any of them,
sustains and for Bodily Injury or Property sustain and to be responsible, hold harmless from and against liability, loss or damage
Damage sustained by its own employees, and indemnify Licensee, the United States, arising out of claims that Contractors and
resulting from Licensed Activities, regardless and any other customer, and each of their Subcontractors of the United States may have
of fault. respective Contractors and Subcontractors, for Property Damage sustained by them, and
(c) The United States hereby waives and for Bodily Injury or Property Damage for Bodily Injury or Property Damage
releases claims it may have against Licensee, sustained by their own employees, resulting sustained by their employees, resulting from
each Customer, any Part 440 Customer, and from Licensed Activities, regardless of fault. Licensed Activities and arising out of the
each of their respective Contractors and (c) The United States shall extend the indemnifying party’s failure to implement
Subcontractors, for Property Damage it requirements of the waiver and release of properly the waiver requirement, to the
sustains, and for Bodily Injury or Property claims, and the assumption of responsibility extent that claims they would otherwise have
Damage sustained by its own employees, as set forth in paragraphs 2(c) and 3(b),
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for such damage or injury exceed the amount
resulting from Licensed Activities, regardless respectively, to its Contractors and of insurance or demonstration of financial
of fault, to the extent that claims it would Subcontractors by requiring them to waive responsibility required under § 440.9(c) and
otherwise have for such damage or injury and release all claims they may have against (e), respectively, of the Regulations.
exceed the amount of insurance or Licensee, each Customer, any Part 440
demonstration of financial responsibility Customer, and each of their respective 6. Assurances Under 51 U.S.C. 50914(e)
required under § 440.9(c) and (e), Contractors and Subcontractors, and to agree Notwithstanding any provision of this
respectively, of the Regulations. to be responsible, for any Property Damage Agreement to the contrary, Licensee shall
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![55130 Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations
hold harmless and indemnify the United Federal Aviation Administration of the Injury or Property Damage sustained by its
States and its agencies, servants, agents, Department of Transportation on Behalf of own employees, resulting from Permitted
employees and assignees, or any of them, the United States Government Activities, regardless of fault. Permittee shall
from and against liability, loss or damage By: lllllllllllllllllll hold harmless and indemnify the United
arising out of claims for Bodily Injury or Its: lllllllllllllllllll States, and the Contractors and
Property Damage, resulting from Licensed Subcontractors of the United States, for
Activities, regardless of fault, except to the Associate Administrator for Commercial Bodily Injury or Property Damage sustained
extent that: (i) As provided in paragraph 7(b) Space Transportation by its own employees, resulting from
of this Agreement, claims result from willful ■ 5. Revise appendix C to part 440 to Permitted Activities, regardless of fault.
misconduct of the United States or its agents; read as follows: (b) The United States shall be responsible
(ii) claims for Property Damage sustained by for Property Damage it sustains, resulting
the United States or its Contractors and Appendix C to Part 440—Agreement for from Permitted Activities, regardless of fault,
Subcontractors exceed the amount of Waiver of Claims and Assumption of to the extent that claims it would otherwise
insurance or demonstration of financial Responsibility for Permitted Activities have for such damage exceed the amount of
responsibility required under § 440.9(e) of insurance or demonstration of financial
the Regulations; (iii) claims by a Third Party Part 1—Waiver of Claims and Assumption of responsibility required under § 440.9(e) of
for Bodily Injury or Property Damage exceed Responsibility for Permitted Activities With the Regulations.
the amount of insurance or demonstration of No Customer
4. Extension of Assumption of Responsibility
financial responsibility required under This agreement is entered into this ll and Waiver and Release of Claims
§ 440.9(c) of the Regulations, and do not day of llll, by and between [Permittee]
exceed $1,500,000,000 (as adjusted for (the ‘‘Permittee’’) and the Federal Aviation (a) Permittee shall extend the requirements
inflation after January 1, 1989) above such Administration of the Department of of the waiver and release of claims, and the
amount, and are payable pursuant to the Transportation, on behalf of the United States assumption of responsibility, hold harmless,
provisions of 51 U.S.C. 50915 and § 440.19 of Government (collectively, the ‘‘Parties’’), to and indemnification, as set forth in
the Regulations; or (iv) Licensee has no implement the provisions of § 440.17(c) of paragraphs 2(a) and 3(a), respectively, to its
liability for claims exceeding $1,500,000,000 the Commercial Space Transportation Contractors and Subcontractors by requiring
(as adjusted for inflation after January 1, Licensing Regulations, 14 CFR Ch. III (the them to waive and release all claims they
1989) above the amount of insurance or ‘‘Regulations’’). This agreement applies to may have against the United States, and
demonstration of financial responsibility [describe permitted activity]. In against the Contractors and Subcontractors of
required under § 440.9(c) of the Regulations. consideration of the mutual releases and the United States, and to agree to be
promises contained herein, the Parties hereby responsible for Property Damage they sustain
7. Miscellaneous and to be responsible, hold harmless, and
agree as follows:
(a) Nothing contained herein shall be indemnify the United States, and the
construed as a waiver or release by Licensee, 1. Definitions
Contractors and Subcontractors of the United
any Customer or the United States of any Contractors and Subcontractors means States, for Bodily Injury or Property Damage
claim by an employee of the Licensee, any entities defined by § 440.3 of the Regulations. sustained by their own employees, resulting
Customer or the United States, respectively, Permit means Permit No._______issued on from Permitted Activities, regardless of fault.
including a member of the Armed Forces of ____________, by the Associate Administrator (b) The United States shall extend the
the United States, for Bodily Injury or for Commercial Space Transportation, requirements of the waiver and release of
Property Damage, resulting from Licensed Federal Aviation Administration, Department claims, and the assumption of responsibility
Activities. of Transportation, to the Permittee, including as set forth in paragraphs 2(b) and 3(b),
(b) Notwithstanding any provision of this all permit orders issued in connection with respectively, to its Contractors and
Agreement to the contrary, any waiver, the Permit. Subcontractors by requiring them to waive
release, assumption of responsibility or Permittee means the holder of the Permit and release all claims they may have against
agreement to hold harmless and indemnify issued under 51 U.S.C. Subtitle V, ch. 509. Permittee, and against the Contractors and
herein shall not apply to claims for Bodily United States means the United States and
Subcontractors of Permittee, and to agree to
Injury or Property Damage resulting from its agencies involved in Permitted Activities.
be responsible, for any Property Damage they
willful misconduct of any of the Parties, the Except as otherwise defined herein, terms
sustain, resulting from Permitted Activities,
Contractors and Subcontractors of any of the used in this Agreement and defined in 51
regardless of fault, to the extent that claims
Parties, any Part 440 Customers, the U.S.C. Subtitle V, ch. 509—Commercial
Space Launch Activities, or in the they would otherwise have for such damage
Contractors and Subcontractors of any Part exceed the amount of insurance or
440 Customer, and in the case of Licensee, Regulations, shall have the same meaning as
contained in 51 U.S.C. Subtitle V, ch. 509, or demonstration of financial responsibility
each Customer, any Part 440 Customer, and required under § 440.9(e) of the Regulations.
the Contractors and Subcontractors of each of the Regulations, respectively.
them, the directors, officers, agents and 2. Waiver and Release of Claims 5. Indemnification
employees of any of the foregoing, and in the (a) Permittee hereby waives and releases Permittee shall hold harmless and
case of the United States, its agents. claims it may have against the United States, indemnify the United States and its agencies,
(c) References herein to Customer shall and against its Contractors and servants, agents, subsidiaries, employees and
apply to, and be deemed to include, each Subcontractors, for Property Damage it assignees, or any of them, from and against
such customer severally and not jointly. sustains and for Bodily Injury or Property liability, loss, or damage arising out of claims
(d) This Agreement shall be governed by Damage sustained by its own employees, that Permittee’s Contractors and
and construed in accordance with United resulting from Permitted Activities, Subcontractors may have for Property
States Federal law. regardless of fault. Damage sustained by them and for Bodily
In witness whereof, the Parties to this (b) The United States hereby waives and Injury or Property Damage sustained by their
Agreement have caused the Agreement to be releases claims it may have against Permittee employees, resulting from Permitted
duly executed by their respective duly and against its Contractors and Activities and arising out of the indemnifying
authorized representatives as of the date Subcontractors, for Property Damage it party’s failure to implement properly the
written above. sustains resulting from Permitted Activities, waiver requirement.
Licensee regardless of fault, to the extent that claims 6. Assurances Under 51 U.S.C. 50914(e)
rmajette on DSK2TPTVN1PROD with RULES
it would otherwise have for such damage
By: lllllllllllllllllll exceed the amount of insurance or (a) Permittee shall hold harmless and
Its: lllllllllllllllllll demonstration of financial responsibility indemnify Customer and its directors,
Customer 1 required under § 440.9(e) of the Regulations. officers, servants, agents, subsidiaries,
employees and assignees, or any of them; the
By: lllllllllllllllllll 3. Assumption of Responsibility United States and its agencies, servants,
Its: lllllllllllllllllll (a) Permittee shall be responsible for agents, subsidiaries, employees and
[Signature lines for each additional customer] Property Damage it sustains and for Bodily assignees, or any of them; and any Part 440
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![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55131
Customer and its directors, officers, servants, and the Federal Aviation Administration of from Permitted Activities, regardless of fault.
agents, subsidiaries, employees and the Department of Transportation, on behalf Permittee and Customer shall each hold
assignees, or any of them, from and against of the United States Government harmless and indemnify each other, the
liability, loss or damage arising out of claims (collectively, the ‘‘Parties’’), to implement the United States, any other customer, and the
that Permittee’s Contractors and provisions of § 440.17(c) of the Commercial Contractors and Subcontractors of each, for
Subcontractors may have for Property Space Transportation Licensing Regulations, Bodily Injury or Property Damage sustained
Damage sustained by them and for Bodily 14 CFR Ch. III (the ‘‘Regulations’’). This by its own employees, resulting from
Injury or Property Damage sustained by their agreement applies to [describe permitted Permitted Activities, regardless of fault.
employees, resulting from Permitted activity]. In consideration of the mutual (b) The United States shall be responsible
Activities. releases and promises contained herein, the for Property Damage it sustains, resulting
(b) Customer shall hold harmless and Parties hereby agree as follows: from Permitted Activities, regardless of fault,
indemnify Permittee and its directors, 1. Definitions to the extent that claims it would otherwise
officers, servants, agents, subsidiaries, have for such damage exceed the amount of
employees and assignees, or any of them; the Contractors and Subcontractors means insurance or demonstration of financial
United States and its agencies, servants, entities defined by § 440.3 of the Regulations. responsibility required under § 440.9(e) of
agents, subsidiaries, employees and Customer means the above-named the Regulations.
assignees, or any of them; and any other Customer.
Part 440 Customer means a customer 4. Extension of Assumption of Responsibility
customer and its directors, officers, servants, and Waiver and Release of Claims
agents, subsidiaries, employees and defined by § 440.3 of the Regulations, other
assignees, or any of them, from and against than the above-named customer. (a) Permittee shall extend the requirements
liability, loss or damage arising out of claims Permit means Permit No. __ issued on of the waiver and release of claims, and the
that Customer’s Contractors, Subcontractors, ____, by the Associate Administrator for assumption of responsibility, hold harmless,
and customers, may have for Property Commercial Space Transportation, Federal and indemnification, as set forth in
Damage sustained by them and for Bodily Aviation Administration, Department of paragraphs 2(a) and 3(a), respectively, to its
Injury or Property Damage sustained by their Transportation, to the Permittee, including Contractors and Subcontractors by requiring
employees, resulting from Permitted all permit orders issued in connection with them to waive and release all claims they
Activities. the Permit. may have against Customer, the United
Permittee means the holder of the Permit States, any Part 440 Customer, and each of
7. Miscellaneous issued under 51 U.S.C. Subtitle V, ch. 509. their respective Contractors and
(a) Nothing contained herein shall be United States means the United States and Subcontractors, and to agree to be
construed as a waiver or release by Permittee its agencies involved in Permitted Activities. responsible, for Property Damage they
or the United States of any claim by an Except as otherwise defined herein, terms sustain and to be responsible, hold harmless
employee of the Permittee or the United used in this Agreement and defined in 51 and indemnify Customer, the United States,
States, respectively, including a member of U.S.C. Subtitle V, ch. 509—Commercial any Part 440 Customer, and each of their
the Armed Forces of the United States, for Space Launch Activities, or in the respective Contractors and Subcontractors,
Bodily Injury or Property Damage, resulting Regulations, shall have the same meaning as for Bodily Injury or Property Damage
from Permitted Activities. contained in 51 U.S.C. Subtitle V, ch. 509, or sustained by their own employees, resulting
(b) Notwithstanding any provision of this the Regulations, respectively. from Permitted Activities, regardless of fault.
Agreement to the contrary, any waiver, (b) Customer shall extend the requirements
2. Waiver and Release of Claims of the waiver and release of claims, and the
release, assumption of responsibility, or
agreement to hold harmless and indemnify (a) Permittee hereby waives and releases assumption of responsibility, hold harmless,
herein shall not apply to claims for Bodily claims it may have against Customer, the and indemnification, as set forth in
Injury or Property Damage resulting from United States, any Part 440 Customer, and paragraphs 2(b) and 3(a), respectively, to its
willful misconduct of any of the Parties, the each of their respective Contractors and customers, Contractors, and Subcontractors,
Contractors and Subcontractors of any of the Subcontractors, for Property Damage it by requiring them to waive and release all
Parties, and in the case of Permittee and its sustains and for Bodily Injury or Property claims they may have against Permittee, the
Contractors and Subcontractors, the Damage sustained by its own employees, United States, any other customer, and each
directors, officers, agents, and employees of resulting from Permitted Activities, of their respective Contractors and
any of the foregoing, and in the case of the regardless of fault. Subcontractors, and to agree to be
United States, its agents. (b) Customer hereby waives and releases responsible, for Property Damage they
(c) This Agreement shall be governed by claims it may have against Permittee, the sustain and to be responsible, hold harmless
and construed in accordance with United United States, any other customer, and each and indemnify Permittee, the United States,
States Federal law. of their respective Contractors and any other customer, and each of their
In witness whereof, the Parties to this Subcontractors, for Bodily Injury or Property respective Contractors and Subcontractors,
Agreement have caused the Agreement to be Damage sustained by its own employees, for Bodily Injury or Property Damage
duly executed by their respective duly resulting from Permitted Activities, sustained by their own employees, resulting
authorized representatives as of the date regardless of fault. from Permitted Activities, regardless of fault.
written above. (c) The United States hereby waives and (c) The United States shall extend the
releases claims it may have against Permittee, requirements of the waiver and release of
Permittee claims, and the assumption of responsibility
Customer, any Part 440 Customer, and each
By: lllllllllllllllllll of their respective Contractors and as set forth in paragraphs 2(c) and 3(b),
Its: lllllllllllllllllll Subcontractors, for Property Damage it respectively, to its Contractors and
Federal Aviation Administration of the sustains, and for Bodily Injury or Property Subcontractors by requiring them to waive
Department of Transportation on Behalf of Damage sustained by its own employees, and release all claims they may have against
the United States Government resulting from Permitted Activities, Permittee, Customer, any Part 440 Customer,
regardless of fault, to the extent that claims and each of their respective Contractors and
By: lllllllllllllllllll Subcontractors, and to agree to be
it would otherwise have for such damage or
Its: lllllllllllllllllll responsible, for any Property Damage they
injury exceed the amount of insurance or
Associate Administrator for Commercial demonstration of financial responsibility sustain and for any Bodily Injury or Property
Space Transportation Damage sustained by their own employees,
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required under § 440.9(c) and (e),
respectively, of the Regulations. resulting from Permitted Activities,
Part 2—Waiver of Claims and Assumption of regardless of fault, to the extent that claims
Responsibility for Permitted Activities With 3. Assumption of Responsibility they would otherwise have for such damage
One Customer (a) Permittee and Customer shall each be or injury exceed the amount of insurance or
This agreement is entered into this __ day responsible for Property Damage it sustains demonstration of financial responsibility
of ____, by and among [Permittee] (the and for Bodily Injury or Property Damage required under § 440.9(c) and (e),
‘‘Permittee’’), [Customer] (the ‘‘Customer’’) sustained by its own employees, resulting respectively, of the Regulations.
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![55132 Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations
5. Indemnification Customer or the United States of any claim Commercial Space Transportation, Federal
(a) Permittee shall hold harmless and by an employee of the Permittee, Customer Aviation Administration, Department of
indemnify Customer and its directors, or the United States, respectively, including Transportation, to the Permittee, including
officers, servants, agents, subsidiaries, a member of the Armed Forces of the United all permit orders issued in connection with
employees and assignees, or any of them; the States, for Bodily Injury or Property Damage, the Permit.
United States and its agencies, servants, resulting from Permitted Activities. Permittee means the holder of the Permit
agents, subsidiaries, employees and (b) Notwithstanding any provision of this issued under 51 U.S.C. Subtitle V, ch. 509.
assignees, or any of them; and any Part 440 Agreement to the contrary, any waiver, United States means the United States and
Customer and its directors, officers, servants, release, assumption of responsibility or its agencies involved in Permitted Activities.
agents, subsidiaries, employees and agreement to hold harmless and indemnify Except as otherwise defined herein, terms
assignees, or any of them, from and against herein shall not apply to claims for Bodily used in this Agreement and defined in 51
liability, loss or damage arising out of claims Injury or Property Damage resulting from U.S.C. Subtitle V, ch. 509—Commercial
that Permittee’s Contractors and willful misconduct of any of the Parties, the Space Launch Activities, or in the
Subcontractors may have for Property Contractors and Subcontractors of any of the Regulations, shall have the same meaning as
Parties, any Part 440 Customer, the contained in 51 U.S.C. Subtitle V, ch. 509, or
Damage sustained by them and for Bodily
Contractors and Subcontractors of any Part the Regulations, respectively.
Injury or Property Damage sustained by their
440 Customer, and in the case of Permittee,
employees, resulting from Permitted 2. Waiver and Release of Claims
Customer, any Part 440 Customer, and the
Activities and arising out of the indemnifying (a) Permittee hereby waives and releases
Contractors and Subcontractors of each of
party’s failure to implement properly the claims it may have against each Customer,
them, the directors, officers, agents and
waiver requirement. the United States, any Part 440 Customer,
employees of any of the foregoing, and in the
(b) Customer shall hold harmless and and each of their respective Contractors and
case of the United States, its agents.
indemnify Permittee and its directors, Subcontractors, for Property Damage it
(c) This Agreement shall be governed by
officers, servants, agents, subsidiaries, and construed in accordance with United sustains and for Bodily Injury or Property
employees and assignees, or any of them; the States Federal law. Damage sustained by its own employees,
United States and its agencies, servants, In witness whereof, the Parties to this resulting from Permitted Activities,
agents, subsidiaries, employees and Agreement have caused the Agreement to be regardless of fault.
assignees, or any of them; and any other duly executed by their respective duly (b) Each Customer hereby waives and
customer and its directors, officers, servants, authorized representatives as of the date releases claims it may have against Permittee,
agents, subsidiaries, employees and written above. the United States, any other customer, and
assignees, or any of them, from and against
Permittee each of their Contractors and Subcontractors,
liability, loss or damage arising out of claims
for Property Damage it sustains and for
that Customer’s Contractors, Subcontractors, By: lllllllllllllllllll Bodily Injury or Property Damage sustained
and customers, may have for Property Its: lllllllllllllllllll
by its own employees, resulting from
Damage sustained by them and for Bodily Customer Permitted Activities, regardless of fault.
Injury or Property Damage sustained by their
employees, resulting from Permitted By: lllllllllllllllllll (c) The United States hereby waives and
Activities and arising out of the indemnifying Its: lllllllllllllllllll releases claims it may have against Permittee,
each Customer, any Part 440 Customer, and
party’s failure to implement properly the Federal Aviation Administration of the
waiver requirement. each of their respective Contractors and
Department of Transportation on Behalf of
Subcontractors, for Property Damage it
6. Assurances Under 51 U.S.C. 50914(e) the United States Government
sustains, and for Bodily Injury or Property
Notwithstanding any provision of this By: lllllllllllllllllll Damage sustained by its own employees,
Agreement to the contrary, Permittee shall Its: lllllllllllllllllll resulting from Permitted Activities,
hold harmless and indemnify the United Associate Administrator for Commercial regardless of fault, to the extent that claims
States and its agencies, servants, agents, Space Transportation it would otherwise have for such damage or
employees and assignees, or any of them, injury exceed the amount of insurance or
from and against liability, loss or damage Part 3—Waiver of Claims and Assumption of demonstration of financial responsibility
arising out of claims for Bodily Injury or Responsibility for Permitted Activities With required under § 440.9(c) and (e),
Property Damage, resulting from Permitted More Than One Customer respectively, of the Regulations.
Activities, regardless of fault, except to the This agreement is entered into this __ day 3. Assumption of Responsibility
extent that: (i) As provided in paragraph 7(b) of ____, by and among [Permittee] (the
of this Agreement, claims result from willful ‘‘Permittee’’); [List of Customers]; (with [List (a) Permittee and each Customer shall each
misconduct of the United States or its agents; of Customers] hereinafter referred to in their be responsible for Property Damage it
(ii) claims for Property Damage sustained by individual capacity as ‘‘Customer’’); and the sustains and for Bodily Injury or Property
the United States or its Contractors and Federal Aviation Administration of the Damage sustained by its own employees,
Subcontractors exceed the amount of Department of Transportation, on behalf of resulting from Permitted Activities,
insurance or demonstration of financial the United States Government (collectively, regardless of fault. Permittee and each
responsibility required under § 440.9(e) of the ‘‘Parties’’), to implement the provisions of Customer shall each hold harmless and
the Regulations; (iii) claims by a Third Party § 440.17(c) of the Commercial Space indemnify each other, the United States, any
for Bodily Injury or Property Damage exceed Transportation Licensing Regulations, 14 other customer, and the Contractors and
the amount of insurance or demonstration of CFR Ch. III (the ‘‘Regulations’’). This Subcontractors of each, for Bodily Injury or
financial responsibility required under agreement applies to [describe permitted Property Damage sustained by its own
§ 440.9(c) of the Regulations, and do not activity]. employees, resulting from Permitted
exceed $1,500,000,000 (as adjusted for In consideration of the mutual releases and Activities, regardless of fault.
inflation after January 1, 1989) above such promises contained herein, the Parties hereby (b) The United States shall be responsible
amount, and are payable pursuant to the agree as follows: for Property Damage it sustains, resulting
provisions of 51 U.S.C. 50915 and § 440.19 of from Permitted Activities, regardless of fault,
1. Definitions
the Regulations; or (iv) Licensee has no to the extent that claims it would otherwise
liability for claims exceeding $1,500,000,000 Contractors and Subcontractors means have for such damage or injury exceed the
entities defined by § 440.3 of the Regulations. amount of insurance or demonstration of
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(as adjusted for inflation after January 1,
1989) above the amount of insurance or Customer means each above-named financial responsibility required under
demonstration of financial responsibility Customer. § 440.9(e) of the Regulations.
required under § 440.9(c) of the Regulations. Part 440 Customer means a customer
defined by § 440.3 of the Regulations, other 4. Extension of Assumption of Responsibility
7. Miscellaneous than the above-named Customer. and Waiver and Release of Claims
(a) Nothing contained herein shall be Permit means Permit No. __ issued on (a) Permittee shall extend the requirements
construed as a waiver or release by Permittee, ____, by the Associate Administrator for of the waiver and release of claims, and the
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![Federal Register / Vol. 81, No. 160 / Thursday, August 18, 2016 / Rules and Regulations 55133
assumption of responsibility, hold harmless, party’s failure to implement properly the each Customer, any Part 440 Customer, and
and indemnification, as set forth in waiver requirement. the Contractors and Subcontractors of each of
paragraphs 2(a) and 3(a), respectively, to its (b) Each Customer shall hold harmless and them, the directors, officers, agents and
Contractors and Subcontractors by requiring indemnify Permittee and its directors, employees of any of the foregoing, and in the
them to waive and release all claims they officers, servants, agents, subsidiaries, case of the United States, its agents.
may have against each Customer, the United employees and assignees, or any of them; the (c) References herein to Customer shall
States, any Part 440 Customer, and each of United States and its agencies, servants, apply to, and be deemed to include, each
their respective Contractors and agents, subsidiaries, employees and such customer severally and not jointly.
Subcontractors, and to agree to be assignees, or any of them; and any other (d) This Agreement shall be governed by
responsible, for Property Damage they customer and its directors, officers, servants, and construed in accordance with United
sustain and to be responsible, hold harmless agents, subsidiaries, employees and States Federal law.
and indemnify each Customer, the United assignees, or any of them, from and against In witness whereof, the Parties to this
States, any Part 440 Customer, and each of liability, loss or damage arising out of claims Agreement have caused the Agreement to be
their respective Contractors and that each Customer’s Contractors, duly executed by their respective duly
Subcontractors, for Bodily Injury or Property Subcontractors, and customers, may have for authorized representatives as of the date
Damage sustained by their own employees, Property Damage sustained by them and for written above.
resulting from Permitted Activities, Bodily Injury or Property Damage sustained Permittee
regardless of fault. by their employees, resulting from Permitted
Activities and arising out of the indemnifying By: lllllllllllllllllll
(b) Each Customer shall extend the Its: lllllllllllllllllll
requirements of the waiver and release of party’s failure to implement properly the
claims, and the assumption of responsibility, waiver requirement. Customer 1
hold harmless, and indemnification, as set 6. Assurances Under 51 U.S.C. 50914(e) By: lllllllllllllllllll
forth in paragraphs 2(b) and 3(a), Notwithstanding any provision of this Its: lllllllllllllllllll
respectively, to its customers, Contractors, Agreement to the contrary, Permittee shall [Signature lines for each additional
and Subcontractors, by requiring them to hold harmless and indemnify the United customer]
waive and release all claims they may have States and its agencies, servants, agents, Federal Aviation Administration of the
against Permittee, the United States, any employees and assignees, or any of them, Department of Transportation on Behalf of
other customer, and each of their respective from and against liability, loss or damage the United States Government
Contractors and Subcontractors, and to agree arising out of claims for Bodily Injury or
to be responsible, for Property Damage they Property Damage, resulting from Permitted By: lllllllllllllllllll
sustain and to be responsible, hold harmless Activities, regardless of fault, except to the Its: lllllllllllllllllll
and indemnify Permittee, the United States, extent that: (i) As provided in paragraph 7(b) Issued under authority provided by 49
any other customer, and each of their of this Agreement, claims result from willful U.S.C. 106(f), 44701(a), and 44703 in
respective Contractors and Subcontractors, misconduct of the United States or its agents; Washington, DC, on July 25, 2016.
for Bodily Injury or Property Damage (ii) claims for Property Damage sustained by Michael P. Huerta,
sustained by their own employees, resulting the United States or its Contractors and
from Permitted Activities, regardless of fault. Administrator.
Subcontractors exceed the amount of
(c) The United States shall extend the insurance or demonstration of financial [FR Doc. 2016–18765 Filed 8–17–16; 8:45 am]
requirements of the waiver and release of responsibility required under § 440.9(e) of BILLING CODE 4910–13–P
claims, and the assumption of responsibility the Regulations; (iii) claims by a Third Party
as set forth in paragraphs 2(c) and 3(b), for Bodily Injury or Property Damage exceed
respectively, to its Contractors and the amount of insurance or demonstration of
Subcontractors by requiring them to waive
DEPARTMENT OF THE TREASURY
financial responsibility required under
and release all claims they may have against § 440.9(c) of the Regulations, and do not Internal Revenue Service
Permittee, each Customer, any Part 440 exceed $1,500,000,000 (as adjusted for
Customer, and each of their respective inflation after January 1, 1989) above such
Contractors and Subcontractors, and to agree amount, and are payable pursuant to the 26 CFR Parts 1, 301, and 602
to be responsible, for any Property Damage provisions of 51 U.S.C. 50915 and § 440.19 of [TD 9782]
they sustain and for any Bodily Injury or the Regulations; or (iv) Licensee has no
Property Damage sustained by their own liability for claims exceeding $1,500,000,000 RIN 1545–BK06
employees, resulting from Permitted (as adjusted for inflation after January 1,
Activities, regardless of fault, to the extent 1989) above the amount of insurance or Tax on Certain Foreign Procurement
that claims they would otherwise have for demonstration of financial responsibility
such damage or injury exceed the amount of required under § 440.9(c) of the Regulations. AGENCY: Internal Revenue Service (IRS),
insurance or demonstration of financial Treasury.
7. Miscellaneous
responsibility required under § 440.9(c) and ACTION: Final regulations.
(e), respectively, of the Regulations. (a) Nothing contained herein shall be
construed as a waiver or release by Permittee, SUMMARY: This document contains final
5. Indemnification any Customer or the United States of any regulations under section 5000C of the
(a) Permittee shall hold harmless and claim by an employee of the Permittee, any Internal Revenue Code relating to the 2
indemnify each Customer and its directors, Customer or the United States, respectively,
percent tax on payments made by the
officers, servants, agents, subsidiaries, including a member of the Armed Forces of
employees and assignees, or any of them; the the United States, for Bodily Injury or U.S. government to foreign persons
United States and its agencies, servants, Property Damage, resulting from Permitted pursuant to certain contracts. The
agents, subsidiaries, employees and Activities. regulations affect U.S. government
assignees, or any of them; and any Part 440 (b) Notwithstanding any provision of this acquiring agencies and foreign persons
Customer and its directors, officers, servants, Agreement to the contrary, any waiver, providing certain goods or services to
agents, subsidiaries, employees and release, assumption of responsibility or the U.S. government pursuant to a
assignees, or any of them, from and against agreement to hold harmless and indemnify contract. This document also contains
rmajette on DSK2TPTVN1PROD with RULES
liability, loss or damage arising out of claims herein shall not apply to claims for Bodily final regulations under section 6114,
that Permittee’s Contractors and Injury or Property Damage resulting from
with respect to foreign persons claiming
Subcontractors may have for Property willful misconduct of any of the Parties, the
Damage sustained by them and for Bodily Contractors and Subcontractors of any of the an exemption from the 2 percent tax
Injury or Property Damage sustained by their Parties, any Part 440 Customer, the under an income tax treaty.
employees, resulting from Permitted Contractors and Subcontractors of any Part DATES: Effective Date: These regulations
Activities and arising out of the indemnifying 440 Customer, and in the case of Permittee, are effective on August 18, 2016.
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Document Created: 2016-08-17 23:46:22
Document Modified: 2016-08-17 23:46:22
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Rules and Regulations | |
| Action | Final rule. | |
| Dates | Effective October 17, 2016. | |
| Contact | For questions concerning this rule, contact Shirley McBride, Regulations Program Lead, AST-300, Office of Commercial Space Transportation, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267- 7470; email [email protected] | |
| FR Citation | 81 FR 55115 | |
| RIN Number | 2120-AK44 | |
| CFR Associated | Indemnity Payments; Insurance; Reporting and Recordkeeping Requirements and Space Transportation and Exploration |
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