Federal Register Vol. 81, No.201,

The Director of OGE (Director) is authorized by 18 U.S.C. 207(h) to designate distinct and separate departmental or agency components in the executive branch for purposes of 18 U.S.C. 207(c), the one-year post-employment conflict of interest restriction for senior employees. The representational bar of 18 U.S.C. 207(c) usually extends to the whole of any department or agency in which a former senior employee served in any capacity during the year prior to termination from a senior employee position. However, 18 U.S.C. 207(h) provides that whenever the Director determines that an agency or bureau within a department or agency in the executive branch exercises functions which are distinct and separate from the remaining functions of the department or agency and there exists no potential for use of undue influence or unfair advantage based on past Government service, the Director shall by rule designate such agency or bureau as a separate component of that department or agency. As a result, a former senior employee who served in a “parent” department or agency is not barred by 18 U.S.C. 207(c) from making communications to or appearances before any employees of any designated component of that parent, but is barred as to employees of that parent or of other components that have not been separately designated. Moreover, a former senior employee who served in a designated component of a parent department or agency is barred from communicating to or making an appearance before any employee of that component, but is not barred as to any employee of the parent, of another designated component, or of any other agency or bureau of the parent that has not been designated.

Under 18 U.S.C. 207(h)(2), component designations do not apply to persons employed at a rate of pay specified in or fixed according to subchapter II of 5 U.S.C. chapter 53 (the Executive Schedule). Component designations are listed in appendix B to 5 CFR part 2641.

The Director regularly reviews the component designations and determinations and, in consultation with the department or agency concerned, makes such additions and deletions as are necessary. Specifically, the Director “shall, by rule, make or revoke a component designation after considering the recommendation of the designated agency ethics official.” 5 CFR 2641.302(e)(3). Before designating an agency component as distinct and separate for purposes of 18 U.S.C. 207(c), the Director must find that there exists no potential for use of undue influence or unfair advantage based on past Government service, and that the component is an agency or bureau, within a parent agency, that exercises functions which are distinct and separate from the functions of the parent agency and from the functions of other components of that parent. 5 CFR 2641.302(c).

Pursuant to the procedures prescribed in 5 CFR 2641.302(e), two agencies have forwarded written requests to OGE to amend their listings in appendix B. After carefully reviewing the requested changes in light of the criteria in 18 U.S.C. 207(h) as implemented in 5 CFR 2641.302(c), OGE is proposing to grant these requests and amend appendix B as explained below.

The Department of Labor has requested that OGE revoke the designation of the Employment Standards Administration (ESA) in appendix B to part 2641, and in the place of ESA designate the Office of Federal Contract Compliance Programs (OFCCP), Office of Labor Management Standards (OLMS), Office of Workers' Compensation Programs (OWCP), and the Wage and Hour Division (WHD) as distinct and separate components of the Department of Labor for purposes of 18 U.S.C. 207(c). These four entities were the major program components of ESA until November 8, 2009, when the Secretary of the Department of Labor dissolved ESA into its constituent components. OFCCP, OLMS, OWCP, and WHD are each headed by a director who now reports directly to the Secretary of Labor.

OFCCP enforces, for the benefit of job seekers and wage earners, the contractual promise of affirmative action and equal employment opportunity required of those who do business with the Federal Government (Government contractors and subcontractors). Specifically, OFCCP administers and enforces three legal authorities requiring equal employment opportunity: Executive Order 11246, as amended; Section 503 of the Rehabilitation Act of 1973, as amended; and the Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended, 38 U.S.C. 4212. These authorities prohibit Federal contractors and subcontractors from discriminating on the basis of race, color, religion, sex, sexual orientation, gender identity, national origin, disability, and protected veteran status, and also require Federal contractors and subcontractors to take affirmative action to ensure equal employment opportunity in their employment processes.

OLMS administers and enforces most provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). The LMRDA is a law that promotes union democracy and financial integrity in private sector labor unions through standards for union officer elections and union trusteeships and safeguards for union assets, and also promotes labor union and labor-management transparency through certain reporting and disclosure requirements. In addition to the LMRDA, OLMS administers provisions of the Civil Service Reform Act of 1978 and the Foreign Service Act of 1980 relating to standards of conduct for Federal employee organizations, which are comparable to LMRDA requirements. OLMS' role as an independent enforcement agency overseeing unions gives it a unique and critical role within the Department of Labor with a key stakeholder.

OWCP administers four major disability compensation programs that provide wage replacement benefits, medical treatment, vocational rehabilitation, and other benefits to certain workers or their dependents who experience work-related injury or occupational disease. Specifically, the OWCP administers the Energy Employees Occupational Illness Compensation Program, the Federal Employees' Compensation Program, the Longshore and Harbor Workers' Compensation Program, and the Coal Mine Workers' Compensation Program, each of which serve specific employee groups by mitigating the financial burden resulting from workplace injury.

WHD enforces the federal minimum wage, overtime pay, recordkeeping, and child labor requirements of the Fair Labor Standards Act. WHD also enforces the Migrant and Seasonal Agricultural Worker Protection Act, the Employee Polygraph Protection Act, the Family and Medical Leave Act, the wage garnishment provisions of the Consumer Credit Protection Act, and various employment standards and worker protections provided in several immigration-related statutes. WHD also administers and enforces the prevailing wage requirements of the Davis Bacon Act and the Service Contract Act, and other statues applicable to federal contracts for construction and the provision of goods and services.

According to the Department of Labor, the functions of OFCCP, OLMS, OWCP, and WHD are distinct and separate from each other, and also distinct and separate from every other agency within the Department. This distinction was previously recognized when OGE designated the now-abolished parent agency, ESA, as a separate component of the Department of Labor for purposes of 18 U.S.C. 207(c). The action that abolished the ESA left OFCCP, OLMS, OWCP, and WHD in its place. The four departments were each created by distinct authorities that are separate not only from each other but also from the organic statute for the Department of Labor; have been explicitly delegated distinct responsibilities following dissolution of the ESA; exercise distinct and separate functions to implement and enforce distinct and separate statutes; as noted above, are each headed by a political appointee who reports directly to the Secretary of Labor; and are relatively the same size as other components designated by the Department of Labor in appendix B to part 2641. Given the manner in which OFCCP, OLMS, OWCP, and WHD work independently from other component agencies and the general management of the Department of Labor, there exists no potential for the use of undue influence or unfair advantage based on past Government service.

Accordingly, OGE is proposing to grant the request of the Department of Labor and is proposing to amend the agency's listing in appendix B to part 2641 to remove the ESA from the component designation list and to designate OFCCP, OLMS, OWCP, and WHD as new components for purposes of 18 U.S.C. 207(c).

The Department of Transportation has requested that OGE designate the Pipeline and Hazardous Materials Safety Administration (PHMSA) as a distinct and separate component of the Department of Transportation for purposes of 18 U.S.C. 207(c). Created pursuant to the Norman Y. Mineta Research and Special Programs Improvements Act of 2004, PHMSA is responsible for regulating safety in pipeline transportation and hazardous materials transportation, see 49 U.S.C. 108, and administers the Natural Gas Pipeline Safety Act of 1968, among other authorities. PHMSA is headed by an Administrator who reports directly to the Secretary of Transportation. The Administrator is statutorily authorized to carry out the duties and powers related to pipeline and hazardous materials transportation and safety, as well as other duties and powers prescribed by the Secretary.

According to the Department of Transportation, PHMSA is responsible for exercising functions that are distinct and separate from the Department of Transportation and from the functions of other Operating Administrations within the agency. PHMSA is the only mode within DOT charged with regulating pipeline safety. It is also the only mode with the primary delegated authority to regulate hazardous material packaging, and is responsible for drafting all hazardous material regulations. In light of the distinct and separate functions of PHMSA, there is no potential for the use of undue influence or unfair advantage based on based on past Government service. PHMSA is comparable in size to several other Department of Transportation divisions that are currently designated as separate components in appendix B to part 2641, and with the designation of PHMSA, each of the Operating Administrations of the Department of Transportation will be designated as separate components for purposes of 18 U.S.C. 207(c).

Accordingly, OGE is proposing to grant the request of the Department of Transportation and amend the listing in appendix B to part 2641 to designate the Pipeline and Hazardous Materials Safety Administration as a new component for purposes of 18 U.S.C. 207(c).

The Department of Transportation also has requested revocation of the designation of the Surface Transportation Board (STB) in appendix B to part 2641. The STB, the successor to the Interstate Commerce Commission, was established in 1996 as an independent entity within the Department of Transportation. On December 28, 2015, the Surface Transportation Board Reauthorization Act of 2015 (Pub. L. 114-110) established the STB as a wholly-independent federal agency. Because the STB is now an independent agency and is no longer administratively aligned with the Department of Transportation, OGE is proposing to grant the request of the Department of Transportation and amend the listing in appendix B to part 2641 to remove STB from the component designation list.

As indicated in 5 CFR 2641.302(f), a designation “shall be effective on the date the rule creating the designation is published in the Federal Register and shall be effective as to individuals who terminated senior service either before, on or after that date.” Initial designations in appendix B to part 2641 were effective as of January 1, 1991. The effective date of subsequent designations is indicated by means of parenthetical entries in appendix B. The new component designations made in this proposed rule would be effective on the date the final rule is published in the Federal Register.

As also indicated in 5 CFR 2641.302(f), revocation of a component designation is effective 90 days after the publication in the Federal Register of the rule that revokes the designation. Accordingly, the component designation revocations proposed in this rule would take effect 90 days after the publication of the final rule effectuating these proposed changes. Revocations are not effective as to any individual terminating senior service prior to the expiration of the 90-day period.

As Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this proposed rule will not have a significant economic impact on a substantial number of small entities because it affects only Federal departments and agencies and current and former Federal employees.

The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply to this proposed rule because it does not contain information collection requirements that require the approval of the Office of Management and Budget.

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 25, subchapter II), this proposed rule would not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation) in any one year.

The proposed rule is not a major rule as defined in 5 U.S.C. chapter 8, Congressional Review of Agency Rulemaking.

In promulgating this rule, the Office of Government Ethics has adhered to the regulatory philosophy and the applicable principles of regulation set forth in Executive Orders 12866 and 13563. This proposed rule has not been reviewed by the Office of Management and Budget under Executive Order 12866 because it is not a “significant” regulatory action for the purposes of that order.

As Director of the Office of Government Ethics, I have reviewed this proposed rule in light of section 3 of Executive Order 12988, Civil Justice Reform, and certify that it meets the applicable standards provided therein.

Accordingly, for the reasons set forth in the preamble, the Office of Government Ethics proposes to amend 5 CFR part 2641, as set forth below:

The revisions read as follows:

On October 13, 2011, the Commission published in the Federal Register an ANPRM seeking comment on whether and how to revise the rules at 11 CFR 110.11 regarding disclaimers on internet communications.1 Specifically, the Commission was considering whether to modify the disclaimer requirements for certain internet communications, or to provide exceptions thereto, consistent with the Federal Election Campaign Act, 52 U.S.C. 30101-46 (“the Act”). The Commission received seven substantive comments in response to the ANPRM. All but one of the commenters agreed that the Commission should update the disclaimer rules through a rulemaking, though commenters differed on how the Commission should do so. In light of subsequent legal and technological developments, the Commission is reopening the comment period and will hold a hearing.

As discussed in the ANPRM, a “disclaimer” is a statement that must appear on certain communications to identify who paid for it and, where applicable, whether the communication was authorized by a candidate. 52 U.S.C. 30120(a); 11 CFR 110.11. With some exceptions, the Act and Commission regulations require disclaimers for public communications: (1) Made by a political committee; (2) that expressly advocate the election or defeat of a clearly identified federal candidate; or (3) that solicit a contribution. 52 U.S.C. 30120(a); 11 CFR 110.11(a). While the term “public communication” generally does not include internet communications, it does include “communications placed for a fee on another person's Web site.” 11 CFR 100.26.2 In addition to these internet public communications, “electronic mail of more than 500 substantially similar communications when sent by a political committee . . . and all Internet Web sites of political committees available to the general public” also must have disclaimers. 11 CFR 110.11(a).

Commission regulations set forth certain exceptions to the general disclaimer requirements. For example, disclaimers are not required for communications placed on “[b]umper stickers, pins, buttons, pens, and similar small items upon which the disclaimer cannot be conveniently printed.” 11 CFR 110.11(f)(1)(i) (the “small items exception”). Nor are disclaimers required for “[s]kywriting, water towers, wearing apparel, or other means of displaying an advertisement of such a nature that the inclusion of a disclaimer would be impracticable.” 11 CFR 110.11(f)(1)(ii) (the “impracticable exception”).

As discussed in the ANPRM, some internet advertisements are so character-limited that providing all the disclaimer information required by the Act may take up much of the available ad characters. See Advisory Opinion 2010-19 (Google) (describing 95-character search result advertisements); cf. Advisory Opinion Request 2011-09 (Facebook) (describing several categories of advertisements ranging from zero to 160 characters).3 However, the ANPRM noted that technological options may allow for the display of disclaimers when a user “hovers” or “rolls” over the advertisement, or on the landing page to which the user is taken after clicking the advertisement.4

Since the publication of the ANPRM, the Commission has considered these issues in new factual contexts. See, e.g., Advisory Opinion Request 2013-18 (Revolution Messaging) (asking whether “banner ads” viewed on mobile phones, either in Web site or app, required disclaimers); MUR 6911 (Frankel) (considering whether candidates' and political parties' Twitter profiles and individual tweets required disclaimers). The Commission seeks comments on how the issues and possible approaches discussed in the ANPRM might or might not apply to these new technological presentations. The Commission also notes that, since the ANPRM was published, at least one additional state has joined California in adopting regulations to address small internet advertisements.5 The Commission seeks comments addressing persons' experiences in complying with (and receiving disclosure from) these state rules as well as other disclosure regimes. The Commission is also interested in comments that address:

• How campaigns, parties, and other political committees, voters, and others disseminate and receive electoral information via the internet and other technologies, including any data or experiences in purchasing, selling, or distributing small or character-limited advertisements on Web sites, apps, and mobile devices;

• any challenges in complying with the existing disclaimer rules as applied to internet communications;

• the technological or other characteristics that might define a “small” internet advertisement;

• how a disclaimer requirement or exception for “small” internet advertisements might be implemented;

• the informational benefits of disclaimers on internet communications to assist voters in identifying the source of advertising so they are better “able to evaluate the arguments to which they are being subjected”; 6

• the informational benefits of disclaimers on internet communications, including Web sites and social media pages, to avoid voter confusion and reduce the incidence of solicitations that appear to be for candidates but are actually for non-candidate committees; and

• the extent to which the Commission's consideration of disclaimer requirements should take into account current or anticipated models of internet advertising.

The Commission also invites additional comments on any issues discussed in the ANPRM and is particularly interested in comments addressing advertisements on internet-enabled applications and devices (such as apps, eReaders, and wearable technology). Given the speed at which technological advances are developing, the Commission welcomes comments that address possible regulatory approaches that might minimize the need for serial revisions to the Commission's rules in order to adapt to new or emerging technologies.

FDA is proposing to amend its regulations to revise the list of drug products that have been withdrawn or removed from the market because the drug products or components of such drug products have been found to be unsafe or not effective (referred to as “the withdrawn or removed list” or “the list”) (§ 216.24 (21 CFR 216.24)). Drugs appearing on the withdrawn or removed list may not be compounded under the exemptions provided by sections 503A and 503B of the FD&C Act (21 U.S.C. 353a and 353b).

The Agency is proposing to add three entries (all drug products containing aprotinin, all drug products containing bromocriptine mesylate, and all intravenous drug products containing greater than a 16 milligram (mg) single dose of ondansetron hydrochloride) as described in this document to the list in § 216.24 of drug products that cannot be compounded for human use under the exemptions provided by either section 503A or 503B of the FD&C Act because they have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective.

We are proposing that the following drugs that have been withdrawn or removed from the market because such drug products have been found to be unsafe or not effective be added to the list in § 216.24. The specific entries proposed for addition to the list for each of these drugs are provided as follows:

Aprotinin: All drug products containing aprotinin.

Bromocriptine mesylate: All drug products containing bromocriptine mesylate for prevention of physiological lactation.

Ondansetron hydrochloride: All intravenous drug products containing greater than a 16 mg single dose of ondansetron hydrochloride.

The Agency is not aware of any routine use of the drug products that FDA is proposing to add to the the withdrawn or removed list and, therefore, does not estimate any compliance costs or loss of sales as a result of the prohibition against compounding these drug products for human use. The Agency has determined that this rulemaking is not a significant regulatory action as defined by Executive Order 12866.

Section 503A of the FD&C Act describes the conditions that must be satisfied for human drug products compounded by a licensed pharmacist or licensed physician to be exempt from the following three sections of the FD&C Act: (1) Section 501(a)(2)(B) (21 U.S.C. 351(a)(2)(B)) (concerning current good manufacturing practice); (2) section 502(f)(1) (21 U.S.C. 352(f)(1)) (concerning the labeling of drugs with adequate directions for use); and (3) section 505 (21 U.S.C. 355) (concerning the approval of drugs under new drug applications (NDAs) or abbreviated new drug applications (ANDAs)).

In addition, section 503B of the FD&C Act describes the conditions that must be satisfied for a drug compounded for human use by or under the direct supervision of a licensed pharmacist in an outsourcing facility to be exempt from three sections of the FD&C Act: (1) Section 502(f)(1), (2) section 505, and (3) section 582 (21 U.S.C. 360eee-1) (concerning drug supply chain security).

One of the conditions that must be satisfied to qualify for the exemptions under both sections 503A and 503B of the FD&C Act is that the compounder does not compound a drug product that appears on a list published by the Secretary of drug products that have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective (withdrawn or removed list) (see sections 503A(b)(1)(C), 503B(a)(4), and 503B(a)(11) of the FD&C Act).

The drug products listed in § 216.24 (the withdrawn or removed list) have been withdrawn or removed from the market because they have been found to be unsafe or not effective and are ineligible for the exemptions set forth in sections 503A and 503B of the FD&C Act. A drug product that is included in the list codified at § 216.24 is not eligible for the exemptions provided in section 503A(a) of the FD&C Act, and is subject to sections 501(a)(2)(B), 502(f)(1), and 505 of the FD&C Act, in addition to other applicable provisions, if compounded. In addition, a drug that is included in the list codified at § 216.24 cannot qualify for the exemptions provided in section 503B(a) of the FD&C Act, and is subject to sections 502(f)(1), 505, and 582 of the FD&C Act, in addition to other applicable provisions, if compounded.

Following the addition of section 503A to the FD&C Act on November 21, 1997, through the enactment of the Food and Drug Administration Modernization Act of 1997 (Pub. L. 105-115), FDA proposed a rule in the Federal Register of October 8, 1998 (63 FR 54082), to establish the original list of drug products that have been withdrawn or removed from the market because the drug products or the components of such drug products have been found to be unsafe or not effective (1998 proposed rule) and therefore were not permitted to be compounded for human use under the exemptions provided by section 503A(a).

In the Federal Register of March 8, 1999 (64 FR 10944), FDA published a final rule that codified the original list in § 216.24 (1999 final rule).

Following the addition of section 503B to the FD&C Act on November 27, 2013, through the enactment of the Drug Quality and Security Act (Pub. L. 113-54), FDA proposed to amend the list in § 216.24 on July 2, 2014 (79 FR 37687); FDA published the final rule to amend § 216.24 in the Federal Register of October 7, 2016 (81 FR 69668) (2016 final rule). Given that nearly identical criteria apply for a drug to be included on the list referred to in section 503A(b)(1)(C) and the list referred to in section 503B(a)(4) of the FD&C Act, FDA revised and updated the list at § 216.24 to clarify that it applies for purposes of both sections 503A and 503B.

FDA is proposing to amend § 216.24 to add three drug products, described in the following paragraphs, that have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective.

As with the 1999 final rule establishing the original list, and the 2016 final rule revising that list, the primary focus of this proposed rule is on drug products that have been withdrawn or removed from the market because they have been found to be unsafe. FDA may propose at a later date to add other drug products to the list that have been withdrawn or removed from the market because they have been found to be not effective, or to update the list as new information becomes available to the Agency regarding products that were removed from the market because they have been found to be unsafe.

The following drugs proposed for inclusion in § 216.24 are arranged alphabetically by the established names of the active ingredients contained in the drug products that have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective. For some of the drug products, the proprietary or trade names of some or all of the drug products that contained the active ingredient are also given in the preamble paragraphs describing the withdrawn or removed drug products. In some cases, the withdrawn or removed drug products are identified according to the established name of the active ingredient, listed as a particular salt or ester of the active moiety. The following list includes the specific drug entry FDA is proposing to add to § 216.24, as well as a brief summary of the reasons why each drug is being proposed for inclusion.

a. Aprotinin: All drug products containing aprotinin.

Bayer suspended marketing of aprotinin (TRASYLOL, NDA 20304) in November 2007 for safety reasons. TRASYLOL, NDA 20304, was approved on December 29, 1993. The indication for TRASYLOL, NDA 20304, was for “prophylactic use to reduce perioperative blood loss and the need for blood transfusion in patients undergoing cardiopulmonary bypass in the course of coronary artery bypass graft surgery who are at increased risk for blood loss and blood transfusion.” Prominent known adverse reactions associated with the use of the drug included anaphylactic reactions (with some deaths reported) and impaired renal function. In January 2006, Mangano et al. published a report that described the results from a retrospective analysis of the use of aprotinin compared to two other antifibrinolytic drugs (tranexamic acid and aminocaproic acid) or no antifibrinolytic drugs in 4,374 patients undergoing cardiac surgery (Ref. 1). The conclusions were that there was a statistically greater likelihood of the development of renal dysfunction and the need for hemodialysis, stroke, encephalopathy, myocardial infarction, and congestive heart failure in patients treated with aprotinin than with the other antifibrinolytic drugs or no antifibrinolytic drugs. On February 8, 2006, FDA issued a Public Health Advisory on TRASYLOL, NDA 20304, that called attention to this new information (Ref. 2). On September 21, 2006, FDA convened a meeting of its Cardiovascular and Renal Advisory Committee to evaluate these and other data for the drug (see http://www.fda.gov/ohrms/dockets/ac/cder07.htm#CardiovascularRenal for meeting documents from the September 21, 2006, Cardiovascular and Renal Advisory Committee meeting). The Cardiovascular and Renal Advisory Committee voted that the benefits of TRASYLOL, NDA 20304, compared to its risks warranted continued approvability for the indication (Yes, 18; No, 0; Abstain, 1). Before the advisory committee meeting, the sponsor had funded a study that evaluated a medical database for the outcomes of patients undergoing coronary artery bypass graft surgery (CABG) treated with aprotinin or other antifibrinolytics, which concluded that there was an increased risk of in-hospital death in the aprotinin-treated patients compared to those in patients treated with aminocaproic acid. This information was subsequently published in 2008 by Schneeweiss et al. (Ref. 3). In 2007, Mangano et al. published a report in 3,876 patients undergoing CABG surgery describing a higher mortality after 5 years for those treated with aprotinin compared to those treated with no antifibrinolytic drugs (Ref. 4). In the 2007 Mangano study, patients treated with either tranexamic acid or aminocaproic acid did not experience a higher mortality at 5 years compared to patients treated with no antifibrinolytic drug. These data led to a reconvening of the Cardiovascular and Renal Advisory Committee in a joint meeting with the Drug Safety and Risk Management Advisory Committee on September 12, 2007 (joint meeting), at which these and other data were reviewed (see http://www.fda.gov/ohrms/dockets/ac/cder07.htm#CardiovascularRenal for meeting documents from the September 12, 2007, Cardiovascular and Renal Advisory Committee meeting). The Committees at the joint meeting were informed that there was an ongoing prospective randomized trial of aprotinin, tranexamic acid, and aminocaproic acid in patients undergoing CABG surgery with cardiopulmonary bypass in Canada (named the BART study), but that the results would not be available for several years. Some of the Committee members at the joint meeting stated that the issue should be revisited once the data from the BART study were available. The Advisory Committees at the joint meeting voted that TRASYLOL, NDA 20304, should continue to be authorized to be marketed in the United States. Shortly after the joint meeting, FDA was informed that the Data Monitoring and Safety Committee for the BART study had recommended that the BART trial be terminated early because there appeared to be a greater frequency of death in patients treated with aprotinin (6.0 percent) compared to those treated in the combined tranexamic acid plus aminocaproic acid group (3.9 percent). The study was subsequently published in 2008 by Fergusson (Ref. 5). On October 25, 2007, FDA issued a Safety Alert for Human Medical Products alerting the medical community about the preliminary data from the BART trial (Ref. 6). On November 5, 2007, FDA issued a press release stating that, at the Agency's request, the sponsor had made a decision to suspend the marketing of TRASYLOL, NDA 20304, pending a review of the BART data for safety (Ref. 7). Although some of the data from the BART trial were submitted to FDA and the sponsor submitted its analysis of the data that was made available to the company, FDA was never successful in obtaining the raw data from the trial. Therefore, FDA was not able to conduct its own analyses of the trial data. TRASYLOL, NDA 20304, has not returned to the U.S. market since the sponsor announced its decision to suspend marketing in 2007. Aprotinin was made available by the sponsor for the treatment of certain surgical patients with an established medical need using a treatment protocol under an investigational new drug application (IND) (Ref. 8). Expanded access to aprotinin through this treatment protocol is no longer available (see https://clinicaltrials.gov/ct2/show/NCT00611845?term=aprotinin&rank=4). FDA is not aware of any data that would give us reason to believe that the safety issues identified as having been associated with aprotinin should be restricted to a particular formulation, concentration, indication, route of administration, or dosage form. For these reasons, FDA is proposing to include all drug products containing aprotinin on the withdrawn or removed list.

b. Bromocriptine mesylate: All drug products containing bromocriptine mesylate for prevention of physiological lactation.

Bromocriptine mesylate was associated with risks of hypertension, seizures, and cardiovascular accidents, and the unfavorable benefit-risk balance was specific to the use of bromocriptine mesylate for the prevention of physiological lactation. In 1980, PARLODEL (bromocriptine mesylate) was approved for the prevention of physiological lactation as an acceptable alternative to estrogenic therapy. Subsequently, FDA received postmarket reports of serious and life-threatening adverse reactions (hypertension, seizures, and cerebrovascular accidents) associated with the use of bromocriptine mesylate to suppress lactation. According to the approved labeling for PARLODEL, dated July 15, 1988 (Ref. 9), serious adverse reactions reported in postpartum women included 50 cases of hypertension, 38 cases of seizures (including 4 cases of status epilepticus), 15 cases of strokes, and 3 cases of myocardial infarction. These cases were discussed at a 1989 Fertility and Maternal Health Drugs Advisory Committee meeting (Ref. 10). FDA presented reports of its safety findings, which included 28 reports of hypertension, 36 reports of seizures, and 19 reports of cerebrovascular accidents. FDA had received 85 cases of serious adverse events, including 10 deaths, since the approval of bromocriptine mesylate for lactation suppression in 1980 (August 23, 1994 (59 FR 43347)). The Fertility and Maternal Health Drugs Advisory Committee recommended that no drug then labeled for lactation suppression including bromocriptine mesylate be used for this indication. FDA subsequently asked that all manufacturers of these drugs voluntarily remove this indication from drug labeling. All but Sandoz, the manufacturer of PARLODEL, complied with FDA's request. In a document published in the Federal Register of August 23, 1994, FDA concluded that the risks of hypertension, seizures, and cardiovascular accidents outweighed the product's marginal benefit in preventing postpartum lactation. Accordingly, FDA proposed to withdraw approval of the indication recommending bromocriptine mesylate for preventing physiological lactation in the NDA for PARLODEL, under section 505(e) of the FD&C Act, on the basis that the drug is no longer shown to be safe for this indication. FDA withdrew approval of PARLODEL for the indication of prevention of physiological lactation in a document published in the Federal Register of January 17, 1995 (60 FR 3404). Withdrawal of PARLODEL's indication for the prevention of physiological lactation became effective on February 16, 1995. FDA's review of the withdrawal indicates that the withdrawal of bromocriptine mesylate for prevention of physiological lactation was fundamentally based on an unfavorable benefit-risk balance specific to this indication and not to other approved indications (such as treatment of Parkinson's disease, acromegaly, and prolactin-secreting adenomas). For this reason, FDA is proposing to include all drug products containing bromocriptine mesylate for prevention of physiological lactation on the withdrawn or removed list.

c. Ondansetron hydrochloride: All intravenous drug products containing greater than a 16 mg single dose of ondansetron hydrochloride.

Ondansetron (ondansetron hydrochloride (HCl)) Injection, USP, 32 mg, in 50 milliliters (mL), single intravenous (IV) dose, was associated with a specific type of irregular heart rhythm called QT interval prolongation, and the data suggest that any dose above the maximum recommendation of 16 mg per dose intravenously has the potential for increased risk of QT prolongation. In September 2011, FDA issued a Drug Safety Communication noting concerns that the 32 mg single IV dose of ZOFRAN (ondansetron HCl) and generic versions of that product could increase the risk of abnormal changes in the electrical activity of the heart, which could result in a potentially fatal abnormal heart rhythm (Ref. 11). Based on data subsequently collected from a study conducted at FDA's request by ZOFRAN's sponsor, GlaxoSmithKline (GSK), that identified a significant QT prolongation effect in connection with the 32 mg single IV dose, FDA approved GSK's supplemental application to remove the 32 mg single IV dose information from the labeling for ZOFRAN and has worked with manufacturers of all 32 mg single IV dose ondansetron HCl products to have them removed from the market. On June 29, 2012, FDA issued a Drug Safety Communication to notify health care professionals that the 32 mg single IV dose of ondansetron HCl, indicated for prevention of nausea and vomiting associated with initial and repeat courses of emetogenic cancer chemotherapy in adult patients, should be avoided due to the risk of QT interval prolongation, which can lead to Torsades de Pointes, an abnormal, potentially fatal heart rhythm (Ref. 12). Subsequently, FDA informed the holders of one NDA and four ANDAs for ondansetron HCl that the Agency believes that, in light of the safety concern associated with ondansetron HCl in the 32 mg single IV dose, these drug products should be removed from the market. The application holders agreed to voluntarily remove their respective 32 mg single IV dose ondansetron HCl products from the market and requested that FDA withdraw approval of their respective applications under 21 CFR 314.150(d). On December 4, 2012, FDA issued an updated Drug Safety Communication alerting health care professionals that these products would be removed from the market because of their potential for serious cardiac risks (Ref. 13). In the Federal Register of June 10, 2015 (80 FR 32966), FDA announced that it was withdrawing the approval of these five applications. On the same day, in a different document in the Federal Register (80 FR 32962), FDA announced its determination under 21 CFR 314.161 and 314.162(a)(2) that the NDA for Ondansetron (ondansetron HCl) Injection, USP, 32 mg/50 mL, single IV dose was withdrawn from sale for reasons of safety. As explained in the review of ondansetron HCl 32 mg single IV dose for the withdrawn or removed list (see tab 5 of the FDA briefing document for the June 17-18, 2015, Pharmacy Compounding Advisory Committee, available at http://www.fda.gov/AdvisoryCommittees/CommitteesMeetingMaterials/Drugs/PharmacyCompoundingAdvisoryCommittee/ucm431285.htm), for those approved products for IV ondansetron HCl that remain on the market, the current dosage and administration recommendation for adults and pediatric patients (6 months to 18 years) is three 0.15 mg/kilogram doses, up to a maximum of 16 mg per dose, infused intravenously over 15 minutes, and any dose above the maximum recommended 16 mg per IV dose has the potential for increased risk of QT prolongation. For these reasons, FDA is proposing to include all IV drug products containing greater than a 16 mg single dose of ondansetron HCl on the withdrawn or removed list.

On June 17, 2015, FDA presented these three proposed entries to the Pharmacy Compounding Advisory Committee (see the Federal Register of May 22, 2015 (80 FR 29717)). In addition to these three proposed entries, FDA presented a potential entry for all drug products containing more than 325 mg of acetaminophen per dosage unit to the Pharmacy Compounding Advisory Committee. The addition of all drug products containing more than 325 mg of acetaminophen per dosage unit to the list remains under consideration by the Agency.

The Pharmacy Compounding Advisory Committee voted in favor of including each of FDA's four proposed entries on the list. Although an open public hearing session was scheduled at this meeting to allow members of the public to present their views and opinions on the proposed entries to the committee members and the Agency prior to the vote by the Pharmacy Compounding Advisory Committee, no members of the public signed up to participate. A transcript of the June 2015 Pharmacy Compounding Advisory Committee meeting and briefing information that includes reviews and background on the proposed entries may be found at the Division of Dockets Management (see ADDRESSES) and at http://www.fda.gov/AdvisoryCommittees/CommitteesMeetingMaterials/Drugs/PharmacyCompoundingAdvisoryCommittee/ucm431285.htm.

Sections 503A and 503B of the FD&C Act provide the principal legal authority for this proposed rule. As described previously in the Background section of this document, section 503A of the FD&C Act describes the conditions that must be satisfied for human drug products compounded by a licensed pharmacist or licensed physician to be exempt from three sections of the FD&C Act (sections 501(a)(2)(B), 502(f)(1), and 505). One of the conditions that must be satisfied to qualify for the exemptions under section 503A of the FD&C Act is that the licensed pharmacist or licensed physician does not compound a drug product that appears on a list published by the Secretary in the Federal Register of drug products that have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective (see section 503A(b)(1)(C) of the FD&C Act). Section 503A(c)(1) of the FD&C Act also states that the Secretary shall issue regulations to implement section 503A, and that before issuing regulations to implement section 503A(b)(1)(C) pertaining to the withdrawn or removed rule, among other sections, the Secretary shall convene and consult an advisory committee on compounding unless the Secretary determines that the issuance of such regulations before consultation is necessary to protect the public health.

Section 503B of the FD&C Act describes the conditions that must be satisfied for a drug compounded for human use by or under the direct supervision of a licensed pharmacist in an outsourcing facility to be exempt from three sections of the FD&C Act (sections 502(f)(1), 505, and 582). One of the conditions in section 503B of the FD&C Act that must be satisfied to qualify for the exemptions is that the drug does not appear on a list published by the Secretary of drugs that have been withdrawn or removed from the market because such drugs or components of such drugs have been found to be unsafe or not effective (see section 503B(a)(4)). To be eligible for the exemptions in section 503B, a drug must be compounded in an outsourcing facility in which the compounding of drugs occurs only in accordance with section 503B, including as provided in section 503B(a)(4).

Thus, sections 503A and 503B of the FD&C Act, in conjunction with our general rulemaking authority in section 701(a) of the FD&C Act (21 U.S.C. 371(a)), serve as our principal legal authority for this proposed rule revising FDA's regulations on drug products withdrawn or removed from the market because the drug product or a component of the drug product have been found to be unsafe or not effective in § 216.24.

We have determined under 21 CFR 25.30(h) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

We have examined the impacts of the proposed rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct us to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). We believe that this proposed rule is not a significant regulatory action as defined by Executive Order 12866.

The Regulatory Flexibility Act requires us to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because small businesses are not expected to incur any compliance costs or loss of sales due to this regulation, we propose to certify that the proposed rule will not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires us to prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $146 million, using the most current (2015) Implicit Price Deflator for the Gross Domestic Product. We do not expect this proposed rule to result in any 1-year expenditure that would meet or exceed this amount.

This proposed rule would amend § 216.24 concerning human drug compounding. Specifically, the proposed rule would add to or modify the list of drug products that may not be compounded under the exemptions provided by sections 503A and 503B of the FD&C Act because the drug products have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective (see section II of this document). We are proposing to add three entries to the list. We are not aware of any routine compounding for human use of the drug products that are the subject of this proposed rule, and therefore do not estimate any compliance costs or loss of sales if the proposal is adopted. However, we invite the submission of comments and solicit current compounding usage data for these drug products, if they are compounded for human use.

Unless we certify that a rule will not have a significant economic impact on a substantial number of small entities, the Regulatory Flexibility Act requires us to analyze regulatory options to minimize any significant economic impact of a regulation on small entities. Most pharmacies meet the Small Business Administration definition of a small entity, which is defined as having annual sales less than $25.5 million for this industry. We are not aware of any routine compounding of these drug products and do not estimate any compliance costs or loss of sales to small businesses as a result of the prohibition against compounding these drug products. Therefore, we propose to certify that this proposed rule will not have a significant economic impact on a substantial number of small entities.

FDA tentatively concludes that this proposed rule contains no collection of information. Therefore, clearance by the Office of Management and Budget under the Paperwork Reduction Act of 1995 is not required.

We have analyzed this proposed rule in accordance with the principles set forth in Executive Order 13132. We have determined that this proposed rule does not contain policies that have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, we conclude that the rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

The following references are on display in the Division of Dockets Management (see ADDRESSES) and are available for viewing by interested persons between 9 a.m. and 4 p.m., Monday through Friday; they are also available electronically at http://www.regulations.gov. FDA has verified the Web site addresses, as of the date this document publishes in the Federal Register, but Web sites are subject to change over time.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, it is proposed that 21 CFR part 216 be amended as follows:

Purpose: This proposed rule would amend the rules of practice before the Patent Trial and Appeal Board (PTAB) to recognize that communications between non-attorney U.S. patent agents or foreign patent practitioners and their clients that pertain to authorized practice before the United States Patent and Trademark Office (Office or USPTO) are privileged to the same extent as communications of that sort conducted between clients and U.S. attorneys. Under the proposed rule, those communications would be protected from discovery in trial practice proceedings at the USPTO. The proposed rule would apply to inter partes review (IPR), post-grant review (PGR), the transitional program for covered business method patents (CBM), and derivation proceedings. Currently, the rules governing proceedings at the USPTO do not address the privilege of communications with patent practitioners, and questions regarding that matter are decided on a case-by-case basis under common law principles. This new rule will not affect the duty of disclosure and candor before the Office under 37 CFR 1.56.

Background: Within this notice, the term “patent practitioner” includes both those authorized to practice patent matters before the USPTO and those authorized to practice patent matters in foreign jurisdictions. When referring to these groups separately, the terms “U.S. or domestic patent practitioners” and “foreign patent practitioners” will be used, respectively.

In February 2015, the USPTO held a roundtable and solicited comments on attorney-client privilege issues. See Notice of Roundtable and Request for Comments on Domestic and International Issues Related to Privileged Communications Between Patent Practitioners and Their Clients, 80 FR 3953 (Jan. 26, 2015). As part of that process, the USPTO requested comments on whether it should recognize that communications between patent applicants and owners and their U.S. patent agents or foreign patent practitioners are privileged to the same extent as communications between U.S. patent attorneys and patent applicants and owners. Respondents unanimously supported a rule recognizing such privilege. See USPTO, Summary of Roundtable and Written Comments, available at http://www.uspto.gov/sites/default/files/documents/Summary%20of%20Privileged%20Communication%20Roundtable.pdf (“Privilege Report”).

The USPTO administers various proceedings that entail discovery procedures, namely the IPR, PGR, and transitional program for CBM patents. In addition, the derivation proceedings provided for by the Leahy-Smith America Invents Act, Public Law 112-29, 125 Stat. 284 (2011) (AIA) permit discovery. Questions regarding privilege issues may arise in the course of discovery, and as some roundtable commenters noted, rules regarding privilege for U.S. patent agents and foreign practitioners during discovery in PTAB proceedings are not well defined.

Current Practice: PTAB proceedings are subject to the Federal Rules of Evidence (FRE), which include rules on attorney-client privilege. See 37 CFR 42.62(a). Accordingly, privilege may be asserted in PTAB proceedings by licensed attorneys. However, the FRE does not explicitly address privilege for communications with non-attorney U.S. patent agents or with foreign patent practitioners.

The rules governing PTAB practice likewise do not address this matter, and when it arises, PTAB Administrative Law Judges make legal determinations as to which communications may be protected from disclosure on a case-by-case basis, based on common law. See GEA Process Engineering, Inc. v. Steuben Foods, Inc., IPR2014-00041, Paper 117 (PTAB 2014). U.S. courts have devised several different approaches to determine under what circumstances communications with these practitioners are privileged. As the Privilege Report notes, the common law on privilege for domestic and foreign patent practitioners varies across jurisdictions. Different approaches are taken, and results sometimes conflict. This may lead to administrative inefficiencies and inconsistencies in outcomes, as PTAB must select which set of common law rules to follow. (It is also noted that Administrative Law Judges in other agencies recognize certain confidential communications with a patent agent as privileged. See, e.g., USITC Inv. No. 337-TA-339, slip op. at 2, 1992 WL 811804 (ITC 1992) (finding that confidential communications between a U.S. patent agent and his client in connection with a patent prosecution are privileged).) The Federal Circuit recently recognized that attorney-client privilege applies to U.S. patent agents acting within the scope of their authorized practice. See In re Queen's University at Kingston, PARTEQ Research and Development Innovations, No. 2015-145 (Fed. Cir. 2016).

The Office has strong policy reasons to establish a privilege rule governing trial proceedings before PTAB. Such a rule would help ensure consistent outcomes with respect to privilege matters that arise at the Office, would improve public understanding of how privilege questions are decided before PTAB, and would help further judicial economy by providing PTAB judges with a clear, concise statement of when privilege applies.

Public Comments: In August 2015, the USPTO published in the Federal Register a proposed rule amending the rules for trial practice before the Office. See Amendments to the Rules of Practice for Trials Before the Patent Trial and Appeal Board, 80 FR 50719 (Aug. 20, 2015). Included in that proposed rule was a request for comments on the advisability of a privilege rule for PTAB proceedings. The comments submitted in response to that request are available on the USPTO Web site at http://www.uspto.gov/patents-application-process/patent-trial-and-appeal-board/comments-amendments-rules-practice-trials.

Those responding to the request universally agreed that a privilege rule for PTAB proceedings should be promulgated. Respondents overwhelmingly favored promulgating such a rule, with some noting that it would lead to clarity and consistency and “can reduce uncertainty and mitigate discovery costs.” See Letter from Frederick W. Mau II on behalf of Toyota Motor Corp., David B. Kelley on behalf of Ford Motor Co., and Mark Duell on behalf of American Honda Motor Co., Inc., RE: Comments on Amendments to the Rules of Practice for Trials Before the Patent Trial and Appeal Board, p. 4-5 (Oct. 16, 2015). Others suggested that “[i]f patent agents are not entitled to have their communications be considered privileged, however, then their utility—and associated cost savings for stakeholders—is lost.” See Letter from Sharon A. Israel, President of the American Intellectual Property Law Assoc., RE: Response to Proposed “Amendments to the Rules of Practice for Trials Before the Patent Trial and Appeal Board,” 80 FR 50720 (August 20, 2015), p. 15-16 (Oct. 21, 2015).

Commenters said it “would be particularly useful for patent agents['] communications to be explicitly protected in the discovery rules for post-grant proceedings (e.g., inter parties [sic] review) before the USPTO.” See Letter from Dorothy R. Auth, President of the New York Intellectual Property Law Assoc., RE: NYIPLA Comments in Response to “Amendments to the Rules of Practice for Trials Before the Patent Trial and Appeal Board,” Federal Register Notice, August 20, 2015, Vol. 80, No. 161 (80 FR 50720), p. 6-9 (Nov. 18, 2015). Commenters suggested that the rule should extend at least to communications made in connection with acts that patent agents are authorized to perform in their particular jurisdictions, such as prosecuting patent applications. The USPTO agrees that the scope of a privilege rule should be defined by the activities that the agent is authorized to carry out. Others suggested that it should be “a simple rule . . . that explicitly recognize[s] privilege for communications between patent applicants or owners and their domestic patent agents or foreign professional patent practitioners under the same circumstances as such privilege is recognized for communications between applicants or owners and U.S. attorneys.” See Letter from Andrew D. Meikle, President of the U.S. Section of the International Federation of Intellectual Property Attorneys (FICPI), RE: Comments on “Recognizing Privilege for Communications With Domestic Patent Agents and Foreign Patent Practitioners”, p. 4 (Nov. 24, 2015).

According to these comments, “[t]his approach would provide the greatest uniformity and certainty, and avoid the need for the PTAB to engage in complex fact based analysis regarding application of the privilege under the common law.” Id. These views were echoed by a law professor who has studied this issue since 2008:

The USPTO agrees with these views and believes the proposed rule reflects them. As a policy matter, open and frank discussions between practitioners and clients promotes effective legal representation before the Office.

Taking into consideration comments from the public and insight gained from practice, the Office proposes to amend 37 CFR 42 to add new section 42.57 that clarifies which patent practitioners are eligible for assertions of attorney-client privilege.

The term “patent practitioner” is used to conform with existing terminology and avoid confusion with other terms used around the world, such as “IP Advisor” or “Patent Advisor.” It fits with practice elsewhere in Title 37, which refers to domestic “patent practitioners,” i.e., U.S. patent agents and patent attorneys registered under 37 CFR 11.6. This narrower meaning is appropriate for most sections of Title 37, which deal with practitioners admitted to practice before the USPTO. For the new rule only, the term also includes comparable foreign counterparts practicing before foreign patent offices.

The rule would provide that the privilege only applies where the practitioner performs legal work authorized by the jurisdiction in which the practitioner practices. For instance, communications between clients and U.S. patent agents relating to patent application matters would be protected as privileged under the rule, but communications between these parties regarding litigation strategies would not be protected. The proposed rule also does not recognize privilege as applying to advice given by lay persons in jurisdictions that do not impose professional qualifications as a requirement to practice. However, the proposed rule can apply to communications from an in-house counsel who performs the functions of a patent attorney under appropriate circumstances, even though some civil law jurisdictions may not grant in-house counsel the privilege-type protections given to attorneys.

The Office invites the public to provide any comments on the proposed rule to inform further action.

Costs and Benefits: This rulemaking is not economically significant, and is not significant, under Executive Order 12866 (Sept. 30, 1993), as amended by Executive Order 13258 (Feb. 26, 2002) and Executive Order 13422 (Jan. 18, 2007).

This proposed rule revises the rules of practice before PTAB to recognize that communications between non-attorney or foreign patent practitioners and their clients that pertain to authorized practice before the USPTO are privileged. The changes in this rulemaking involve rules of agency practice and procedure and/or interpretive rules. See Nat'l Org. of Veterans' Advocates v. Secretary of Veterans Affairs, 260 F.3d 1365, 1375 (Fed. Cir. 2001) (rule that clarifies interpretation of a statute is interpretive); Bachow Commc'ns Inc. v. F.C.C., 237 F.3d 683, 690 (D.C. Cir. 2001) (rules governing an application process are procedural under the Administrative Procedure Act); Inova Alexandria Hosp. v. Shalala, 244 F.3d 342, 350 (4th Cir. 2001) (rules for handling appeals were procedural where they did not change the substantive requirements for reviewing claims).

Accordingly, prior notice and opportunity for public comment are not required pursuant to 5 U.S.C. 553(b) or (c), or any other law. See Cooper Techs. Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5 U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), do not require notice and comment rulemaking for “interpretative rules, general statements of policy, or rules of agency organization, procedure, or practice” (quoting 5 U.S.C. 553(b)(A))). However, the Office chose to seek public comment before implementing the rule to benefit from the public's input.

For the reasons set forth herein, the Deputy General Counsel for General Law of the USPTO has certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule will not have a significant economic impact on a substantial number of small entities. See 5 U.S.C. 605(b).

The changes proposed in this rule are to revise the rules of practice before PTAB to explicitly recognize that communications between non-attorney or foreign patent practitioners and their clients that pertain to authorized practice before the USPTO or foreign patent offices are privileged and to define those persons who may avail themselves of this privilege. These proposed changes are expected to create no additional burden to those practicing before the Board as this rule merely clarifies rights and protections for the practitioner and client and does not impose a change in practice or requirements. In fact, this rule may produce a small benefit from a reduction in uncertainty and mitigation of discovery costs. For the foregoing reasons, the changes proposed in this rule will not have a significant economic impact on a substantial number of small entities.

This rulemaking has been determined to be not significant for purposes of Executive Order 12866 (Sept. 30, 1993).

The Office has complied with Executive Order 13563. Specifically, the Office has, to the extent feasible and applicable: (1) Made a reasoned determination that the benefits justify the costs of the rule; (2) tailored the rule to impose the least burden on society consistent with obtaining the regulatory objectives; (3) selected a regulatory approach that maximizes net benefits; (4) specified performance objectives; (5) identified and assessed available alternatives; (6) involved the public in an open exchange of information and perspectives among experts in relevant disciplines, affected stakeholders in the private sector and the public as a whole, and provided on-line access to the rulemaking docket; (7) attempted to promote coordination, simplification, and harmonization across government agencies and identified goals designed to promote innovation; (8) considered approaches that reduce burdens and maintain flexibility and freedom of choice for the public; and (9) ensured the objectivity of scientific and technological information and processes.

This rulemaking does not contain policies with federalism implications sufficient to warrant preparation of a Federalism Assessment under Executive Order 13132 (Aug. 4, 1999).

This rulemaking will not: (1) Have substantial direct effects on one or more Indian tribes; (2) impose substantial direct compliance costs on Indian tribal governments; or (3) preempt tribal law. Therefore, a tribal summary impact statement is not required under Executive Order 13175 (Nov. 6, 2000).

This rulemaking is not a significant energy action under Executive Order 13211 because this rulemaking is not likely to have a significant adverse effect on the supply, distribution, or use of energy. Therefore, a Statement of Energy Effects is not required under Executive Order 13211 (May 18, 2001).

This rulemaking meets applicable standards to minimize litigation, eliminate ambiguity, and reduce burden as set forth in sections 3(a) and 3(b)(2) of Executive Order 12988 (Feb. 5, 1996).

This rulemaking does not concern an environmental risk to health or safety that may disproportionately affect children under Executive Order 13045 (Apr. 21, 1997).

This rulemaking will not affect a taking of private property or otherwise have taking implications under Executive Order 12630 (Mar. 15, 1988).

Under the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the USPTO will submit a report containing the rule and other required information to the United States Senate, the United States House of Representatives, and the Comptroller General of the Government Accountability Office. The changes in this final rule are not expected to result in an annual effect on the economy of 100 million dollars or more, a major increase in costs or prices, or significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets. Therefore, this final rule is not a “major rule” as defined in 5 U.S.C. 804(2).

The changes set forth in this rulemaking do not involve a Federal intergovernmental mandate that will result in the expenditure by State, local, and tribal governments, in the aggregate, of 100 million dollars (as adjusted) or more in any one year, or a Federal private sector mandate that will result in the expenditure by the private sector of 100 million dollars (as adjusted) or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions are necessary under the provisions of the Unfunded Mandates Reform Act of 1995. See 2 U.S.C. 1501 et seq.

This rulemaking will not have any effect on the quality of the environment and is thus categorically excluded from review under the National Environmental Policy Act of 1969. See 42 U.S.C. 4321 et seq.

The requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because this rulemaking does not contain provisions which involve the use of technical standards.

The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3549) requires that the Office consider the impact of paperwork and other information collection burdens imposed on the public. This proposed rule not does not involve any new information collection requirements that are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3549). Any information collections associated with this rule have been previously approved under OMB control number 0651-0069.

Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to, a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a currently valid OMB control number.

For the reasons set forth in the preamble, 37 CFR part 42 is proposed to be amended as follows:

On July 25, 2016, the Judges published a proposed rule and requested comments. 81 FR 48371. The proposed rule was based upon a partial settlement 1 regarding copyright royalty rates and terms applicable during the upcoming rate period for the section 115 statutory license for making and distributing phonorecords of nondramatic musical works. See Joint Motion to Adopt Partial Settlement, Docket No. 16-CRB-0003-PR (2018-2022) (June 15, 2016).

On or before August 24, 2016, the Judges received two timely comments, one from the American Association of Independent Music (A2IM) that supported it and one from Sony Music Entertainment (“Sony”) that supported it in part and opposed it in part.

On August 30, 2016, the National Music Publishers' Association and the Nashville Songwriters Association International filed a joint Motion for Leave to Respond to the Comments and Objections of Sony Music Entertainment Concerning Proposed Settlement (Joint Motion). In the interest of promoting a more complete record with regard to the proposed rule, the Judges will grant the Joint Motion. In addition, the Judges hereby announce that they will accept, without additional motions required, additional reply comments, if any, to the comments filed by A2IM and Sony.

The reply comments, if any, must be submitted no later than November 17, 2016.

Interested members of the public must submit reply comments to only one of the following addresses. If not submitting by email or online, commenters must submit an original of their reply comments, five paper copies, and an electronic version in searchable PDF format on a CD.

Email: [email protected]; or

Online: http://www.regulations.gov; or

U.S. mail: Copyright Royalty Board, P.O. Box 70977, Washington, DC 20024-0977; or

Overnight service (only USPS Express Mail is acceptable): Copyright Royalty Board, P.O. Box 70977, Washington, DC 20024-0977; or

Commercial courier: Address package to: Copyright Royalty Board, Library of Congress, James Madison Memorial Building, LM-403, 101 Independence Avenue SE., Washington, DC 20559-6000. Deliver to: Congressional Courier Acceptance Site, 2nd Street NE. and D Street NE., Washington, DC; or

Hand delivery: Library of Congress, James Madison Memorial Building, LM-401, 101 Independence Avenue SE., Washington, DC 20559-6000.

The Veterans' Mortgage Life Insurance (VMLI) program was established in 1971 to provide mortgage protection insurance to service-disabled veterans who receive Specially Adapted Housing Grants from VA. Under 38 U.S.C. 2106(g), the amount of VMLI coverage for a veteran is the amount necessary to pay the veteran's mortgage indebtedness in full, except as limited by section 2106(b) or “regulations prescribed by the Secretary under this section.” Section 2106(b) currently limits the amount of VMLI available to $200,000. Therefore, currently, a veteran who has a mortgage indebtedness that is greater than $200,000 and seeks VMLI must be covered in the amount of $200,000 and pay the corresponding premiums for such coverage. VA has concluded that requiring this level of coverage in such circumstance may cause some individuals to forego VMLI protection because they cannot afford the premiums. To address this specific problem and to allow veterans to pay lower premiums regardless of their mortgage indebtedness, VA proposes to exercise its explicit statutory authority set forth in section 2106(g) and amend its regulations to permit program participants to lower their premiums by carrying VMLI in an amount less than both the $200,000 statutory maximum and the amount necessary to pay the covered mortgage indebtedness in full.

As noted, paying the premiums on the level of coverage required under current regulations can present a financial hardship to individuals insured under the program. We realize that allowing eligible individuals to carry an amount of VMLI lower than the amount outstanding on the mortgage loan may result in circumstances where an insured dies with a balance on the loan that exceeds the amount of VMLI in effect, which currently occurs when an individual's mortgage balance exceeds the statutory maximum level of coverage. In such a situation, the individual's survivors may have to assume payment on the mortgage. However, VA believes that it is preferable for individuals to participate in the VMLI program to the extent they can financially, rather than foregoing coverage entirely because they cannot afford it. If an eligible individual opts out of the program, and then dies with an outstanding balance on the loan, his or her survivors could ultimately be forced to assume an even greater indebtedness than if the individual had carried partial VMLI coverage.

Individuals often seek to lower their VMLI premiums by requesting an amount of coverage less than both the statutory limit and the amount necessary to pay the mortgage indebtedness in full. For example, from January 1, 2005, to December 31, 2010, when the statutory coverage limit was $90,000, VA received 231 requests to terminate existing VMLI coverage. VA reviewed approximately 100 requests to determine if financial hardship was a factor in individuals' decisions to terminate coverage. Thirty percent of veterans who terminated their coverage during that period stated that the premium charged for their coverage was the main factor motivating their requests.

Effective October 1, 2011, the Veterans' Benefits Act of 2010 raised the statutory maximum coverage for VMLI from $90,000 to $150,000, and to $200,000 after January 1, 2012. See Public Law 111-275, Title IV, § 407, 124 Stat. 2864, 2880. Depending on a veteran's age and mortgage balance, this statutory change could cause an individual's monthly premiums to increase by almost $400.00—from less than $460.00 to more than $850.00 per month. As such, VA has concluded that, because premiums for the new statutory maximum amount of $200,000 are considerably higher than premiums for the former maximum amount, an increasing number of individuals may terminate their VMLI coverage or decline coverage entirely unless VA offers options to buy a lesser amount of VMLI.

To promptly address this problem, VA adopted an interim policy allowing insureds to select less than both the statutory maximum and their outstanding mortgage balance. VA implemented this interim policy to avoid unintended harm to program participants. VA now seeks to amend its regulations to make this policy permanent.

In establishing the VMLI program, Congress intended to provide seriously disabled veterans with a reasonable level of mortgage protection insurance. If individuals decline coverage because they cannot afford the premiums, the purpose of the program is undermined. Therefore, VA proposes to amend its Part 8a regulations to reflect the new statutory maximum and provide program participants the option to select a more affordable level of coverage that is lower than both the statutory maximum and their outstanding mortgage balance. VA believes this change would benefit all VMLI-eligible individuals because it would provide needed flexibility in the program and empower veterans to decide what level of coverage they can afford. As explained above, VA has concluded that it is preferable for individuals to make their own financial decisions as to what level of VMLI they can afford, rather than foregoing coverage because they cannot afford a higher amount mandated by statute. Absent VA's proposed amendment, current regulations would likely prompt some veterans to decline VMLI coverage because they cannot afford the required premiums, ultimately forcing more survivors into greater mortgage debt than if partial VMLI coverage were available.

We interpret 38 U.S.C. 2106 as authorizing VA to prescribe regulations permitting VMLI coverage in amounts less than the statutory maximum and the outstanding mortgage indebtedness. Section 2106(g) requires that VMLI participants carry the amount of insurance necessary to pay their mortgage indebtedness in full, but explicitly authorizes the Secretary to prescribe an exception to this requirement. Moreover, section 2106(b) imposes a cap of $200,000 in coverage but does not mandate that VMLI participants carry the maximum amount of coverage available. Therefore, VA's proposed amendments to its regulations are implicitly authorized by 38 U.S.C. 2106.

The proposed amendment would exercise this authority by amending 38 CFR 8a.1(c) and 38 CFR 8a.2(a) to provide insureds with the option to select a more affordable level of coverage. We propose to revise the term “initial amount of insurance” in § 8a.1(c) to mean “the amount of insurance selected by the insured, which may be less than the statutory maximum of $200,000 and less than the amount necessary to pay the mortgage indebtedness in full.” This change would make clear that VMLI-eligible individuals are authorized to carry such VMLI coverage as they select, up to the lesser of the $200,000 statutory maximum or the amount necessary to pay their mortgage indebtedness in full. We would also amend § 8a.2(a) and (b)(1) and § 8a.4(b) and (c) to reflect that the current statutory maximum of VMLI coverage, as previously increased, is $200,000.

The proposed amendments to 38 CFR 8a.4(b)-(c) removing “available to” and adding in its place “selected by” are designed to ensure conformity with this change by making clear that the amount of insurance on the life of the eligible individual may be a reduced amount selected by the eligible individual, up to the lesser of the $200,000 statutory maximum or the amount necessary to pay their mortgage indebtedness in full. For the reasons discussed above, these amendments would benefit veterans and their beneficiaries by adding needed flexibility to the program and empowering individuals to make financial decisions based on the level of VMLI coverage they can afford. While such decisions require veterans and their families to consider the financial risk of choosing a lower amount of VMLI that may not cover their mortgage indebtedness in full, we feel that such personal financial decisions are best left to veterans and their families. Accordingly, VA's proposed amendments seek to provide veterans with the flexibility to choose the level of VMLI coverage that meets their financial needs. In doing so, we seek to minimize the number of eligible individuals who opt out of the program for financial reasons, and reduce instances where a veteran's survivors must assume greater indebtedness than if the veteran had carried at least partial VMLI coverage. In short, VA has concluded that veterans should enjoy the option to obtain VMLI coverage tailored to their specific needs.

We also propose a number of technical changes to 38 CFR part 8a to ensure consistency with current statutory authority. In the Housing and Economic Recovery Act of 2008, Congress extended eligibility for VMLI coverage to servicemembers in addition to veterans. See Public Law 110-289, section 2602, 122 Stat. 2654, 2858-2860. We propose to add a new definition of “eligible individual” at § 8a.1(f) to reflect this extension of eligibility for VMLI coverage and replace the term veteran with individual wherever appropriate in §§ 8a.1 through 8a.4. These substitutions would not cause any substantive change other than that brought about by Public Law 110-289.

Additionally, we propose one technical change to 38 CFR 8a.2(b)(8), which currently prescribes, “[a]ll claims, arising out of the deaths of insured veterans occurring prior to (date of final publication), shall be subject to the provisions of paragraph (a) of this section then in effect which limited the amount of VMLI coverage to a lifetime maximum per eligible veteran.” The parenthetical “(date of final publication)” appears to have been erroneously maintained in the Code of Federal Regulations, rather than being replaced by the appropriate date. We are correcting this error by striking “(date of final publication)” and inserting “December 24, 1987,” which is the effective date of the final rule that codified that regulation. See 52 FR 26356-01 (July 14, 1987) (proposed); 52 FR 48681-02 (Dec. 24, 1987) (final). No substantive change is intended.

We would also revise the authority citations at the end of § 8a.2 and § 8a.4 and add authority citations at the end of § 8a.1 and § 8a.3 to cite to 38 U.S.C. 501, 2101, 2101A, and 2106.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in an expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal governments or on the private sector.

This proposed rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12886 (Regulatory Planning and Review) defines a “significant regulatory action,” which requires review by the Office of Management and Budget (OMB), unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866. VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's Web site at http://www.va.gov/orpm/, by following the link for “VA Regulations Published From FY 2004 Through Fiscal Year to Date.”

The Secretary of Veterans Affairs hereby certifies that this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule would directly affect only individuals and would not directly affect any small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

The Catalog of Federal Domestic Assistance number and title for the program affected by this document is 64.103, Life Insurance for Veterans.

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Gina S. Farrisee, Deputy Chief of Staff, Department of Veterans Affairs, approved this document on October 7, 2016, for publication.

For the reasons stated in the preamble, VA proposes to amend 38 CFR part 8a as set forth below:

The revision and additions read as follows:

The revision reads as follows:

The addition reads as follows:

The revision reads as follows:

Preamble Acronyms and Abbreviations. We use multiple acronyms and terms in this preamble. While this list may not be exhaustive, to ease the reading of this preamble and for reference purposes, the EPA defines the following terms and acronyms here:

Organization of This Document. The information in this preamble is organized as follows:

The statutory authority for this action is provided by sections 112 and 307(d)(7)(B) of the Clean Air Act (CAA)(42 U.S.C. 7412 and 7607(d)(7)(B)).

Regulated Entities. Categories and entities potentially regulated by this action are shown in Table 1 of this preamble.

Table 1 of this preamble is not intended to be exhaustive, but rather to provide a guide for readers regarding entities likely to be affected by this action for the source categories listed. To determine whether your facility is affected, you should examine the applicability criteria in the appropriate NESHAP. If you have any questions regarding the applicability of any aspect of these NESHAP, please contact the appropriate person listed in the preceding FOR FURTHER INFORMATION CONTACT section of this preamble.

In addition to being available in the docket, an electronic copy of this proposal will also be available on the Internet through the Technology Transfer Network (TTN) Web site, a forum for information and technology exchange in various areas of air pollution control. Following signature by the EPA Administrator, the EPA will post a copy of this proposed action at: https://www.epa.gov/stationary-sources-air-pollution/petroleum-refinery-sector-risk-and-technology-review-and-new-source. Following publication in the Federal Register, the EPA will post the Federal Register version and key technical documents at this Web site.

On June 30, 2014, the EPA published a proposed rule in the Federal Register addressing the risk and technology review (RTR) for the Petroleum Refinery NESHAP, 40 CFR part 63, subparts CC (Refinery MACT 1) and UUU (Refinery MACT 2). On December 1, 2015 (80 FR 75178), after receiving and addressing public comments, the EPA finalized determinations pursuant to CAA section 112(d)(6) and (f)(2) for the Petroleum Refinery source categories and amended Refinery MACT 1 and 2 based on those determinations. The final December 2015 action included a determination that the remaining risk after promulgation of the revised NESHAP are acceptable and provide an ample margin of safety. The December 2015 action also finalized changes to Refinery MACT 1 and 2 pursuant to CAA section 112(d)(2) and (3), notably revising the requirements for flares and pressure relief devices (PRD). The December 2015 action also finalized technical corrections and clarifications to Refinery NSPS subparts J and Ja to address issues raised by the American Petroleum Institute (API) in their 2008 petition for reconsideration of the final NSPS Ja rule that had not been previously addressed. These include corrections and clarifications to provisions for sulfur recovery plants, performance testing, and control device operating parameters.

Following promulgation, the EPA received three separate petitions for reconsideration: Two jointly from API and the American Fuel and Petrochemical Manufacturers (AFPM) and one from Earthjustice (submitted on behalf of Air Alliance Houston, California Communities Against Toxics, Clean Air Council, Coalition for a Safe Environment, Del Amo Action Committee, Environmental Integrity Project, Sierra Club, Texas Environmental Justice Advocacy Services and Utah Physicians for a Healthy Environment). The petitions are available for review in the rulemaking docket (see Docket ID No. EPA-HQ-OAR-2010-0682).

On January 19, 2016, API and AFPM requested an administrative reconsideration under section 307(d)(7)(B) of the CAA of certain provisions of Refinery MACT 1 and 2, as promulgated in the December 2015 final rule. Specifically, API and AFPM requested that the EPA reconsider the maintenance vent provisions in Refinery MACT 1 for sources constructed on or before June 30, 2014; the alternate startup, shutdown, or hot standby standards for fluid catalytic cracking units (FCCU) constructed on or before June 30, 2014, in Refinery MACT 2; the alternate startup and shutdown for sulfur recovery units (SRU) constructed on or before June 30, 2014, in Refinery MACT 2; and the new catalytic reforming units (CRU) purging limitations in Refinery MACT 2. The request pertained to providing and/or clarifying the compliance time for these sources. In response to this request and additional information received relative to providing additional compliance time for these provisions, the EPA issued a proposal on February 9, 2016 (81 FR 6814). A final rule was published on July 13, 2016 (81 FR 45232, July 13, 2016), fully responding to the January 19, 2016, initial petition for reconsideration submitted by API and AFPM.

On February 1, 2016, Earthjustice filed a petition for reconsideration of several aspects of the December 1, 2015, final rule, and on that same day API and AFPM submitted a supplemental petition for reconsideration, identifying additional issues on which they sought reconsideration. In these petitions, both Earthjustice and API/AFPM requested that the EPA reconsider certain aspects of the December 2015 revisions to Refinery MACT 1 and 2, noting that CAA section 307(d)(7)(B) authorizes the EPA to reconsider a rule where it is impracticable to raise an objection during the period for public comment (but within the time specified for judicial review) or if the grounds for such an objection arose after the close of the public comment period. In particular, Earthjustice claimed that several aspects of the revisions to Refinery MACT 1 were not proposed, and, thus they were precluded from commenting on them during the public comment period: (1) Work practice standards for PRDs and flares; (2) alternative water overflow provisions for delayed coking units (DCU); (3) reduced monitoring provisions for fenceline monitoring; and (4) adjustments to the risk assessment to account for these new work practice standards. The API/AFPM petition outlined a number of specific issues related to the work practice standards for PRDs and flares, and the alternative water overflow provisions for DCUs, as well as a number of other specific issues on other aspects of the rule. On June 16, 2016, the EPA granted the petitions for reconsideration from Earthjustice and API/AFPM on the petitioners' claims as they relate to the following aspects of the December 2015 revisions to the final rule to provide an opportunity for public notice and comment: (1) The work practice standards for PRDs; (2) the work practice standards for emergency flaring events; (3) the assessment of risk as modified based on implementation of these PRD and emergency flaring work practice standards; (4) the alternative work practice standards for DCUs employing the water overflow design; and (5) the provision allowing refineries to reduce the frequency of fenceline monitoring at sampling stations that consistently record benzene concentrations below 0.9 micrograms per cubic meter.

After reviewing the two February 1, 2016, petitions for reconsideration as described above, we granted reconsideration to provide the public an opportunity to comment on selected provisions of the December 2015 amendments and the assessment of risk as modified to account for the implementation of the PRD and emergency flaring work practice standards included in the December 2015 final rule. To ensure public participation in its final decisions, the Agency is requesting public comment on these issues as described below. The EPA is seeking comment only on these five specific issues. The EPA will not respond to any comments addressing any other provisions of the December 1, 2015, final Refinery Sector Rule or any other rule or issues.

In the proposed rule (79 FR 36970, June 30, 2014), EPA proposed to revise Refinery MACT 1 to establish operating and pressure release requirements that apply to all PRDs and to prohibit atmospheric releases of hazardous air pollutants (HAP) from PRDs. To ensure compliance, we proposed to require that sources monitor PRDs using a system that is capable of recording the time and duration of each pressure release and notifying operators that a pressure release has occurred. Many commenters suggested that a prohibition on atmospheric PRD releases was not indicative of the best performing facilities, was unachievable and/or very costly, and would have negative environmental impacts due to additional flares that would need to be installed and operated in standby mode to accept the PRD releases. Some commenters suggested that we should instead consider the rules on PRDs that apply to refineries in the South Coast Air Quality Management District (SCAQMD) and the Bay Area Air Quality Management District (BAAQMD).

Based on these comments, we evaluated the two California district rules and determined that 8 percent (or 12 refineries) are subject to these requirements, which was a sufficient number of subject refineries to establish work practice standards that represent the emissions limitation achieved in practice by the best performers. The two rules are similar in that they both establish comprehensive regulatory programs to address the group or system of PRDs at refineries by requiring monitoring, root cause analysis, and corrective action, and by focusing on PRDs with the greatest emissions potential through a combination of applicability thresholds (albeit with differing thresholds between the two rules). In addition, both rules exclude emissions from certain types of PRDs—typically lower-release potential PRDs, liquid-type PRDs, or in the case of SCAAMD PRDs resulting from events outside of the refinery's control. We considered the two rules as the basis for determining the best performers for establishing the work practice standard that is included in the December 2015 final Refinery Sector Rule (see 40 CFR 63.648(j)(3)). In doing so, similar to these two rules, we established a work practice standard that is a comprehensive set of requirements that apply to the group of PRDs at refineries, and that focuses on reducing the size and frequency of atmospheric releases of HAP from PRDs, with an emphasis on prevention, monitoring, correction, and limitations on the frequency of release events. For further details on our analysis of the SCAQMD and BAAQMD rules and our use of those rules to establish a comprehensive work practice standard for PRDs that are representative of the best performing refineries, refer to the December 1, 2015, notice at 80 FR 75216 and the memorandum in the docket titled, “Pressure Relief Device Control Option Impacts for Final Refinery Sector Rule, July 30, 2015 (Docket ID No. EPA-HQ-OAR-2010-0682-0750).

In the final rule, we established a four-part work practice standard in place of the prohibition on release to the atmosphere based on what was achieved by the best performers, as represented by the two California rules. Consistent with the proposed rule, the first component of the work practice standard requires that owners or operators monitor PRDs using a system that is capable of recording the time and duration of each pressure release and notifying operators that a pressure release has occurred. Second, the work practice standard requires refinery owners or operators to establish preventative measures for each affected PRD to prevent direct release of HAP to the atmosphere as a result of pressure release events. Third, in the event of an atmospheric release, the work practice standard requires refinery owners or operators to conduct a root cause analysis to determine the cause of a PRD release event. If the root cause was due to operator error or negligence, then the release would be a violation of the work practice standard. A second release due to the same root cause for the same equipment in a 3-year period would be a violation of the work practice standard. A third release in a 3-year period would be a violation of the work practice standard, regardless of the root cause. Force majeure events, as defined in the final rule, would not count in determining whether there has been a second or third event. The fourth component of the work practice standard is a requirement for corrective action. For any event other than a force majeure event, the owner or operator would be required to conduct a corrective action analysis and implement the results of the corrective action analysis. Refiners have 45 days to complete the root cause analysis and implement corrective action after the release event. The results of the root cause analysis and corrective action are due with the periodic reports on a semi-annual basis.

We excluded the following PRDs that have very low potential to emit (PTE) based on their type of service, size and pressure from the work practice standard: PRDs that only release material that is liquid at standard temperature and pressure (STP) and that are hard-piped to a controlled drain system, PRDs that do not have a PTE of 72 pounds per day (lbs/day) or more of volatile organic compounds (VOC), PRDs with design release pressure of less than 2.5 pounds per square inch gauge (psig), PRDs on mobile equipment, PRDs in heavy liquid service, and PRDs that are designed solely to release due to liquid thermal expansion. Although these PRDs are excluded from the work practice standard, they are subject to the operating and pressure relief requirements in 40 CFR 63.648(j)(1) and (2), which apply to all PRDs.

We request public comments on the work practice standard for PRDs as provided in 40 CFR 63.648(j)(3) and (5) through (7), including the number and type of release/event allowances; the type of PRDs covered by the work practice standard; and the definition of “force majeure event” in 40 CFR 63.641. We also request public comments on the recordkeeping and reporting requirements associated with the work practice standard in 40 CFR 63.655(g)(10)(iii) and (i)(11).

In the June 2014 proposed rule, the EPA proposed to amend the operating and monitoring requirements for petroleum refinery flares. As discussed in the proposal at 79 FR 36904, we determined that the requirements for flares in the General Provisions at 40 CFR 63.18 were not adequate to ensure compliance with the Refinery MACT standards. In general, flares used as air pollution control devices are expected to achieve a 98-percent HAP destruction efficiency. However, because flows of waste gases to the flares had diminished based on reductions achieved by the increased use of flare gas recovery systems, there were times when the waste gas to the flare contained insufficient heat content to adequately combust and, thus, a 98-percent HAP destruction efficiency was not being achieved. In addition, the practice of applying assist media to the flare (particularly steam to prevent smoking of the flare tip) had led to a decrease in the combustion efficiency of flares.

To ensure that a 98-percent HAP destruction efficiency was being met, as contemplated at the time the MACT standard was promulgated, we proposed revisions to Refinery MACT 1 that required flares to operate with a continuously-lit pilot flame at all times when gases are sent to the flare, with no visible emissions except for periods not to exceed 5 minutes during any 2 consecutive hours, and to meet flare tip velocity limits and combustion zone operating limits at all times when gases are flared.

During the comment period on the proposed rule, we received comments that the concern over insufficient heat content of the waste gas or over-assisting are less problematic in attaining a high level of destruction efficiency at the flare in emergency situations, where the flow in the flare exceeds the smokeless capacity of the flare. Thus, commenters suggested that better combustion was assured closer to the incipient smoke point of the flare and that flow velocity limits and limits on visible emissions should not apply during flaring events.

In the final rule, we determined that it was appropriate to set different standards for when a flare is operating below its smokeless capacity and when it is operating above its smokeless capacity. We finalized the proposed requirements (with minor revisions) to apply when a flare is operating below its smokeless capacity.

We established a separate work practice standard that applies when a flare exceeds its smokeless capacity. As with flares operating below the smokeless capacity, the work practice standard requires the refinery to have a continuously-lit pilot flame and meet combustion zone operating limits (e.g., heat content in the combustion zone) at all times and meet the monitoring, recordkeeping, and reporting requirements. These requirements are the most critical in ensuring that a 98-percent destruction efficiency is being met. The work practice standard also requires owners or operators to develop flare management plans to identify the flare system smokeless capacity and flare components, waste gas streams that are flared, monitoring systems and their locations, procedures that will be followed to limit discharges to the flare that cause the flare to exceed its smokeless capacity, and prevention measures implemented for PRDs that discharge to the flare header. The work practice standard requires refinery owners or operators to conduct a specific root cause analysis and take corrective action for any flaring event that exceeds the flare's smokeless capacity and that also exceeds the flare tip velocity and/or visible emissions limit. Refiners have 45 days to complete the root cause analysis and implement corrective action after an event. The results of the root cause and corrective action are due with the periodic reports on a semi-annual basis.

If the root cause analysis indicates that the exceedance of the flare tip velocity and/or the visible emissions limit is caused by operator error or poor maintenance, the exceedance is a violation of the work practice standard. A second event causing an exceedance of either the flare tip velocity or the visible emissions limit within a rolling 3-year period from the same root cause on the same equipment is a violation of the standard. A third exceedance of the velocity or visible emissions limit occurring from the same flare in a rolling 3-year period is a violation of the work practice standard, regardless of the cause. However, force majeure events are excluded from the event count. The requirements for a continuously-lit pilot flame, combustion-zone operating limits and the monitoring, recordkeeping and reporting requirements apply at all times (whether the flare is operating below, at, or above its smokeless capacity), including during a force majeure event.

In reviewing the regulatory text for this proposed action, we determined that 40 CFR 63.670(o)(1)(ii)(B) contains an incorrect reference to pressure relief devices for which preventative measures must be implemented. The correct reference is paragraph 40 CFR 63.648(j)(3)(ii) not 40 CFR 63.648(j)(5). We are proposing to correct this referencing error.

We request public comments on the above smokeless capacity work practice standard in 40 CFR 63.670(o), including the requirements to maintain records of prevention measures in 40 CFR 63.670(o)(1)(ii)(B) and (o)(1)(vi); the requirement to establish a single smokeless design capacity in 40 CFR 63.670(o)(1)(iii)(B); the number and type of releases/events that constitute a violation; the phrase “. . . and the flare vent gas flow rate is less than the smokeless design capacity of the flare” in 40 CFR 63.670(c) and (d)”; the proposed correction to paragraph 40 CFR 63.670(o)(1)(ii)(B); and other provisions in 40 CFR 63.670(o)(3) through (7). We also request public comments on the recordkeeping and reporting requirements associated with these work practice standards in 40 CFR 63.655(g)(11)(iv) and (i)(9)(x) through (xii).

The results of our residual risk review for the Petroleum Refinery source categories were published in the June 30, 2014, proposal (79 FR 36934 through 36942), and included assessment of chronic and acute inhalation risk, as well as multipathway and environmental risk, to inform our decisions regarding acceptability and ample margin of safety. The results indicated that the cancer risk to the individual most exposed (maximum individual risk or “MIR”) based on allowable HAP emissions is no greater than approximately 100-in-1 million, which is the presumptive limit of acceptability, and that the MIR based on actual HAP emissions is no greater than approximately 60-in-1 million but may be closer to 40-in-1 million. In addition, the maximum chronic non-cancer target organ-specific hazard index (TOSHI) due to inhalation exposures was less than 1. The evaluation of acute non-cancer risks, which was conservative, showed acute risks below a level of concern. Based on the results of a refined site-specific multipathway analysis portion of the risk review, we also concluded that the cancer risk to the individual most exposed through ingestion is considerably less than 100-in-1 million.

In the final Refinery MACT 1 rule, we established work practice standards for PRD releases and emergency flaring events, which under the proposed rule would not have been allowed. Thus, because we did not consider such non-routine emissions under our risk assessment for the proposed rule, we performed a screening assessment of risk associated with these emissions for the final rule as discussed in detail in “Final Residual Risk Assessment for the Petroleum Refining Source Sector” in Docket ID No. EPA-HQ-OAR-2010-0682. Our analysis showed that these HAP emissions could increase the MIR based on actual emissions by as much as 2-in-1 million, which results in essentially the same level of risk as was estimated at proposal. We also estimated that chronic non-cancer TOSHIs attributable to the additional exposures from non-routine flaring and PRD HAP emissions are well below 1. When adding the additional chronic noncancer TOSHI risks from the screening analysis with the analysis in the proposal, chronic noncancer TOSHI risks still remain below 1. Further, our screening analysis also projected that maximum acute exposure to non-routine PRD and flare emissions would result in a maximum hazard quotient (HQ) of 14 from benzene emissions based on a reference exposure level (REL). Based on risk analysis performed for the proposed rule and the screening assessment to consider how conclusions from that analysis would be affected by the additional non-routine flare and PRD emissions allowed under the final rule, we determined that the risk posed after implementation of the revisions to the MACT standards is acceptable.

We request public comments on the screening analysis and the conclusions reached based on that analysis in conjunction with the risk analysis performed for the proposed rule.

In Refinery MACT 1, we finalized MACT standards for DCU decoking operations. Existing DCU-affected sources must comply with a 2 psig or 220 degrees Fahrenheit (°F) limit in the drum overhead line determined on a rolling 60-event basis prior to venting to the atmosphere, draining, or deheading the coke drum. New DCU affected sources must comply with a 2.0 psig or 218 °F limit in the drum overhead line on a per-event, not-to-exceed basis. In the final rule, we also finalized an alternative requirement to address DCU with water overflow design that we did not propose, where pressure monitoring would not be appropriate. As part of these provisions, we also included a new requirement in the final rule for DCU with water overflow design to hard-pipe the overflow drain water to the receiving tank via a submerged fill pipe (pipe below the existing liquid level) whenever the overflow water exceeds 220 °F.

We request public comments on the alternative work practice standard for delayed coking units employing a water overflow design provided in 40 CFR 63.657(e).

In the December 2015 final rule, we revised Refinery MACT 1 to establish a work practice standard requiring refinery owners to monitor benzene concentrations around the fenceline or perimeter of the refinery. We promulgated new EPA Methods 325A and B which specify monitor siting and quantitative sample analysis procedures. The work practice is designed to improve the management of fugitive emissions at petroleum refineries through the use of passive monitors by requiring sources to implement corrective measures if the benzene concentration in air attributable to emissions from the refinery exceeds a fenceline benzene concentration action level. The work practice requires refinery owners to reduce fenceline levels that exceed the concentration action level to at or below that level. In the final rule, we included provisions that were not proposed that would allow for reduced monitoring frequency (after 2 years of continual monitoring) at monitoring locations with consistently low fenceline concentrations.

We request public comments on the provision allowing refineries to reduce the frequency of fenceline monitoring at monitoring sites that consistently record benzene concentrations below 0.9 micrograms per cubic meter, as provided in 40 CFR 63.658(e)(3).

In this action, the EPA is proposing to amend provisions related to how to address overlapping requirements for equipment leaks that are contained in Refinery MACT 1 and in the Refinery Equipment Leak NSPS (40 CFR part 60, subpart GGGa). The Refinery MACT 1 provision at 40 CFR 63.640(p)(2) currently states that equipment leaks that are subject to the provisions in the Refinery Equipment Leak NSPS (40 CFR part 60 subpart GGGa) are only required to comply with the provisions in the Refinery Equipment Leak NSPS. However, the Refinery Equipment Leak NSPS does not include the new work practice standards finalized in the final Refinery MACT 1 at 40 CFR 63.648(j) which apply to releases from PRD. Certain provisions of 40 CFR 63.648(j) detail a work practice standard for the management of releases from PRD. We intended that these new work practice standards would be applicable to all PRD at refineries, including those PRD subject to the requirements in the Refinery Equipment Leaks NSPS. In order to provide clarity and assure that stakeholders subject to these provisions fully understand their compliance obligations, we are proposing that equipment components that are also subject to the provisions of the Refinery Equipment Leak NSPS, are required to comply with the provisions specified in the Refinery Equipment Leaks NSPS, except for PRDs in organic HAP service, which must only comply with the requirements in Refinery MACT 1 at 40 CFR 63.648(j) for PRDs. We are also amending the introductory text in 40 CFR 63.648(j) to reference Refinery Equipment Leaks NSPS at 40 CFR 60.482-4a and amending paragraphs (j)(2)(i) through (iii) of Refinery MACT 1 to correct the existing reference to 40 CFR 60.485(b), which should refer to 40 CFR 60.485(c) and 40 CFR 60.485a(c).

Additional information about these statues and Executive Orders can be found at http://www2.epa.gov/laws-regulations/laws-and-executive-orders.

This action is not a significant regulatory action and was, therefore, not submitted to the Office of Management and Budget (OMB) for review.

This action does not impose any new information collection burden under the PRA. OMB has previously approved the information collection activities contained in the existing regulations at 40 CFR part 63, subpart CC and has assigned OMB control number 2060-0340. The proposed amendments are the result of a clarification that does not affect the estimated burden of the existing rule. Specifically, we are proposing amendments clarifying that facilities using the equipment leak overlap provisions must also comply with the PRD work practice standard in 40 CFR part 63, subpart CC. In our burden estimates for the December 1, 2015, final rule, we assumed that all major source refineries would have to comply with the PRD work practice standards. Consequently, the burden estimates provided with the December 1, 2015, final rule are consistent with the proposed clarifying amendment. Therefore, we have not revised the information collection request for the existing rule.

I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. In making this determination, the impact of concern is any significant adverse economic impact on small entities. An agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, has no net burden, or otherwise has a positive economic effect on the small entities subject to the rule. The proposed rule consists of a clarification which does not change the expected economic impact analysis performed for the existing rule. We have, therefore, concluded that this action will have no net regulatory burden for all directly regulated small entities.

This action does not contain an unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local, or tribal governments or the private sector.

This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.

This action does not have tribal implications as specified in Executive Order 13175. It will not have substantial direct effect on tribal governments, on the relationship between the federal government and Indian tribes, or on the distribution of power and responsibilities between the federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this action.

This action is not subject to Executive Order 13045 because it is not economically significant as defined in Executive Order 12866, and because the EPA does not believe the environmental health or safety risks addressed by this action present a disproportionate risk to children. This action requests comment on a risk assessment that is described in section III. C. of this preamble.

This action is not subject to Executive Order 13211 because it is not a significant energy action under Executive Order 12866.

This rulemaking does not involve technical standards.

The EPA believes that this action does not have disproportionately high and adverse human health or environmental effects on minority populations, low-income populations, and/or indigenous peoples, as specified in Executive Order 12898 (59 FR 7629, February 16, 1994). The proposed amendments serve to clarify one aspect of the rule. They do not relax the control measures on regulated sources, and, therefore, do not change the level of environmental protection.

For the reasons stated in the preamble, title 40, chapter I, of the Code of Federal Regulations is proposed to be amended as follows:

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT for the division listed at the end of the pesticide petition summary of interest.

1. Submitting CBI. Do not submit this information to EPA through regulations.gov or email. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.

2. Tips for preparing your comments. When preparing and submitting your comments, see the commenting tips at http://www.epa.gov/dockets/comments.html.

3. Environmental justice. EPA seeks to achieve environmental justice, the fair treatment and meaningful involvement of any group, including minority and/or low-income populations, in the development, implementation, and enforcement of environmental laws, regulations, and policies. To help address potential environmental justice issues, the Agency seeks information on any groups or segments of the population who, as a result of their location, cultural practices, or other factors, may have atypical or disproportionately high and adverse human health impacts or environmental effects from exposure to the pesticides discussed in this document, compared to the general population.

EPA is announcing its receipt of several pesticide petitions filed under section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a, requesting the establishment or modification of regulations in 40 CFR part 180 for residues of pesticide chemicals in or on various food commodities. The Agency is taking public comment on the requests before responding to the petitioners. EPA is not proposing any particular action at this time. EPA has determined that the pesticide petitions described in this document contain the data or information prescribed in FFDCA section 408(d)(2), 21 U.S.C. 346a(d)(2); however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the pesticide petitions. After considering the public comments, EPA intends to evaluate whether and what action may be warranted. Additional data may be needed before EPA can make a final determination on these pesticide petitions.

Pursuant to 40 CFR 180.7(f), a summary of each of the petitions that are the subject of this document, prepared by the petitioner, is included in a docket EPA has created for each rulemaking. The docket for each of the petitions is available at http://www.regulations.gov.

As specified in FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), EPA is publishing notice of the petition so that the public has an opportunity to comment on this request for the establishment or modification of regulations for residues of pesticides in or on food commodities. Further information on the petition may be obtained through the petition summary referenced in this unit.

1. PP 5E8431. (EPA-HQ-OPP-2016-0087). Bayer CropScience LP, 2 T.W. Alexander Dr., Research Triangle Park, NC, requests to establish a tolerance in 40 CFR part 180.435 for residues of the insecticide, deltamethrin, in or on orange, fruit at 0.3 ppm, orange, dried pulp at 3 ppm, and orange, oil at 50 ppm. The gas chromatography equipped with an electron capture detector (GC/ECD) is used to measure and evaluate the chemical cis-deltamethrin, alpha-R-deltamethrin and trans-deltamethrin. Contact: RD.

2. PP 6E8482. (EPA-HQ-OPP-2016-0352). Interregional Research No 4 (IR-4) Project, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W., Princeton, NJ 08540, requests to establish a tolerance in 40 CFR part 180.442 for residues of the insecticide, Bifenthrin (2-methyl [1,1′-biphenyl]-3-yl) methyl-3-(2-chloro-3,3,3,-trifluoro-1-propenyl)-2,2-dimethylcyclopropanecarboxylate in or on apple, wet pomace at 1.3 ppm; avocado at 0.50 ppm; berry, low growing, subgroup 13-07G at 3.0 ppm; brassica, leafy greens, subgroup 4-16B at 15 ppm; caneberry subgroup 13-07A at 1.0 ppm; fruit, citrus, group 10-10 at 0.05 ppm; fruit, pome, group 11-10, except mayhaw, at 0.70 ppm; fruit, small, vine climbing, except fuzzy kiwifruit, subgroup 13-07F at 0.20 ppm; nut, tree, group 14-12 at 0.05 ppm; peach, subgroup 12-12B at 0.70 ppm; pepper/eggplant subgroup 8-10B at 0.50 ppm; pomegranate at 0.50 ppm; and tomato, subgroup 8-10A at 0.30 ppm. The GC/ECD is used to measure and evaluate the chemical bifenthrin. Contact: RD.

3. PP 6E8483. (EPA-HQ-OPP-2016-0448). IR-4, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201-W, Princeton, NJ 08540, requests to establish tolerances in 40 CFR part 180.686 for residues of the fungicide, benzovindiflupyr (N-[9-(dichloromethylene)-1,2,3,4-tetrahydro-1,4-methanonaphthalen-5-yl]-3-(difluoromethyl)-1-methyl-1H-pyrazole-4-carboxamide) in or on onion, bulb, subgroup 3-07A at 0.02 ppm and onion, green, subgroup 3-07B at 0.4 ppm. The multi-residue analytical method consisting of high pressure liquid chromatography with tandem mass spectrometry (LC/MS/MS) is used to measure and evaluate the chemical benzovindiflupyr. Contact: RD.

4. PP 6E8484. (EPA-HQ-OPP-2016-0475). IR-4, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W., Princeton, NJ 08540, requests to establish tolerances in 40 CFR part 180.475 for residues of the fungicide difenoconazole, 1-[2-[2-chloro-4-(4-chlorophenoxy)phenyl]-4-methyl-1,3-dioxolan-2-ylmethyl]-1H-1,2,4,—triazole, including its metabolites and degradates, in or on brassica, leafy greens, subgroup 4-16B at 35 ppm; cranberry at 0.6 ppm; fruit, small, vine climbing, except fuzzy kiwifruit, subgroup 13-07F at 4.0 ppm; guava at 3.0 ppm; kohlrabi at 2.0 ppm; papaya at 0.6 ppm; and vegetable, brassica, head and stem, group 5-16 at 2.0 ppm. Available analytical methods for crops include gas chromatography (GC) equipped with a nitrogen-phosphorous detector; and LC/MS/MS; and for meat, milk, poultry or eggs, Syngenta's method, AG544A, is used to measure and evaluate the chemical difenoconazole. Contact: RD.

1. PP 6E8482. (EPA-HQ-OPP-2016-0352). IR-4 Project, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W, Princeton, NJ 08540, proposes upon establishment of tolerances referenced above under “New Tolerances” to remove existing tolerances in 40 CFR 180.442 for residues of the insecticide, Bifenthrin (2-methyl [1,1′-biphenyl]-3-yl) methyl-3-(2-chloro-3,3,3,-trifluoro-1-propenyl)-2,2-dimethylcyclopropanecarboxylate in or on apple at 0.5 parts per million (ppm) brassica, leafy greens, subgroup 5B at 3.5 ppm; caneberry, subgroup 13A at 1.0 ppm; eggplant 0.05 ppm; fruit, citrus, group 10 at 0.05 ppm; grape at 0.20 ppm; groundcherry 0.5 ppm; nectarine at 0.5 ppm; nut, tree, group 14 at 0.05 ppm; okra at 0.50 ppm; peach at 0.5 ppm; pear at 0.5 ppm; pepino 0.5 ppm; pepper, bell at 0.5 ppm; pepper, nonbell at 0.5 ppm; pistachio at 0.05 ppm; strawberry at 3.0 ppm; tomato at 0.15 ppm; and turnip, greens at 3.5 ppm. The GC/ECD is used to measure and evaluate the chemical bifenthrin. Contact: RD.

2. PP 6E8484. (EPA-HQ-OPP-2016-0475). IR-4, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W., Princeton, NJ 08540, requests that upon establishing tolerances for this petition under “New Tolerances” above, 40 CFR part 180.475 is amended to remove existing tolerances for residues of the fungicide difenoconazole, 1-[2-[2-chloro-4-(4-chlorophenoxy)phenyl]-4-methyl-1,3-dioxolan-2-ylmethyl]-1H-1,2,4,—triazole, including its metabolites and degradates, in or on brassica, head and stem, subgroup 5A at 1.9 ppm, brassica, leafy greens, subgroup 5B at 35 ppm; grape at 4.0 ppm; and turnip, greens at 35 ppm. Contact: RD

1. PP IN-10922. (EPA-HQ-OPP-2016-0487). Itaconix, 2 Marin Way, Stratham, NH 03885, requests to establish an exemption from the requirement of a tolerance for residues of butanedioic acid, 2-methylene-, telomer with sodium phosphinate (1:1), acidified, potassium salt, 4000 amu, (CAS Reg. No. 1663489-14-2) with a number-average molecular weight (in amu) of 3811 grams/mole when used as an inert ingredient in pesticide formulations under 40 CFR 180.960. The petitioner believes no analytical method is needed because it is not required for an exemption from the requirement of a tolerance. Contact: RD.

2. PP IN-10905. (EPA-HQ-OPP-2016-0472). Technology Sciences Group (1150 18th St., NW., Suite 1000, Washington, DC 20036) on behalf of Central Garden & Pet (1501 East Woodfield Road, Suite 200 West, Schaumburg, IL 60173) requests to establish an exemption from the requirement of a tolerance for residues of ethoxyquin (CAS Reg No. 91-53-2) when used as an inert ingredient (antioxidant and stabilizing agent) in pesticide formulations applied to animals under 40 CFR 180.930 at a concentration not to exceed 0.015% by weight (150 ppm) in finished feed-through pesticide formulations. The petitioner believes no analytical method is needed because it is not required for an exemption from the requirement of a tolerance. Contact: RD

1. PP IN-10965. (EPA-HQ-OPP-2016-0500). Monsanto Company, 1300 I Street NW., Suite 450 East, Washington, DC 20005, requests to amend the exemption from the requirement of a tolerance in 40 CFR 180.910 for residues of mono-, di-, and trimethylnapthalenesulfonic acids and napthalenesulfonic acids formaldehyde condensates, ammonium and potassium salts (CAS Reg. Nos. 9008-63-3, 9069-80-1, 9084-06-4, 36290-04-7, 91078-68-1, 141959-43-5, 68425-94-5) to include the corresponding potassium salt (CAS Reg. No. 67828-14-2) when used as an inert ingredient (surfactant, related adjuvant of surfactant in pesticide formulations applied to growing crops and raw agricultural commodities after harvest. The petitioner believes no analytical method is needed because it is not required for an exemption from the requirement of a tolerance. Contact: RD.

Background Species Information

Please refer to the February 4, 2013, proposed listing rule at 78 FR 7864 for information about the wolverine's taxonomy; life history; requirements for habitat, space, and food; densities; status in Canada and Alaska; geographic range delineation complexities; distribution; and habitat relationships and distribution. Please also refer to our December 14, 2010, 12-month petition finding (75 FR 78030) and our February 4, 2013, proposed rule to list the North American wolverine (78 FR 7864) for a detailed evaluation of the wolverine under our distinct population segment (DPS) policy, which published in the Federal Register on February 7, 1996 (61 FR 4722).

Please refer to the proposed listing rule for the wolverine (78 FR 7864; February 4, 2013) for a detailed description of previous Federal actions concerning the wolverine prior to 2013. On February 4, 2013, we published a proposed rule to list the DPS of wolverine occurring in the contiguous United States as threatened, under the Act, with a proposed rule under section 4(d) of the Act that outlines the prohibitions necessary and advisable for the conservation of the wolverine (78 FR 7864). We also published a February 4, 2013, proposed rule to establish a nonessential experimental population (NEP) area for the North American wolverine in the Southern Rocky Mountains of Colorado, northern New Mexico, and southern Wyoming (78 FR 7890). On October 31, 2013, we reopened the comment period on the proposed listing rule for an additional 30 days (78 FR 65248).

Following publication of the 2013 proposed rules, there was scientific disagreement and debate about the interpretation of the habitat requirements for wolverines and the available climate change information used to determine the extent of threats to the DPS. Based on this substantial disagreement regarding the sufficiency or accuracy of the available data relevant to the proposed listing, on February 5, 2014 (79 FR 6874), we announced a 6-month extension of the final determination of whether to list the wolverine DPS as a threatened species. We also reopened the comment period on the proposed rule to list the contiguous U.S. DPS of the North American wolverine for 90 days.

On August 13, 2014, we withdrew the proposed rule to list the DPS of the North American wolverine as a threatened species under the Act (79 FR 47522). This withdrawal was based on our conclusion that the factors affecting the DPS as identified in the proposed rule were not as significant as believed at the time of the proposed rule's publication in 2013. As a result, we also withdrew our associated proposed rule under section 4(d) of the Act contained in the proposed listing rule and withdrew the proposed NEP designation under section 10(j) of the Act for the southern Rocky Mountains.

In October 2014, three complaints were filed in the District Court for the District of Montana by Defenders of Wildlife, WildEarth Guardians, Center for Biological Diversity, and other organizations challenging the withdrawal of the proposal to list the North American wolverine DPS. Numerous parties intervened in the litigation. These three cases were consolidated, and on April 4, 2016, the court issued a decision. As a result of the court order, the August 13, 2014, withdrawal was vacated and remanded to the Service for further consideration consistent with the order.

In effect, the court's action returns the process to the proposed rule stage, and the status of the wolverine under the Act has effectively reverted to that of a proposed species for the purposes of consultation under section 7 of the Act. Therefore, this document notifies the public that we are reopening the comment period on the February 4, 2013, proposed rule to list the DPS of wolverine occurring in the contiguous United States as threatened, under the Act (78 FR 7864). We also announce that we will be initiating an entirely new status review of the North American wolverine, to determine whether this DPS meets the definition of an endangered or threatened species under the Act, or whether the species is not warranted for listing. Any listing determination we make must be made based on the best available information. We invite the public to comment on the proposed rule, and we request new information regarding the North American wolverine that has become available since the publication of the proposed rule to inform this status review.

We will accept written comments and information during this reopened comment period on our proposed rule to list the DPS of wolverine occurring in the contiguous United States as threatened that was published in the Federal Register on February 4, 2013 (78 FR 7864). We will consider information and recommendations from all interested parties. We are particularly interested in comments concerning:

(1) Biological, commercial trade, or other relevant data concerning any threats (or lack thereof) to this species and regulations that may be addressing those threats.

(2) Additional information concerning the historical and current status, range, distribution, and population size of this species, including the locations of any additional populations of this species.

(3) Any information on the biological or ecological requirements of the species, and ongoing conservation measures or efforts for the species and its habitat.

(4) Current or planned activities in the areas occupied by the species and possible impacts of these activities on this species.

(5) The reasons why we should or should not designate habitat as “critical habitat” under section 4 of the Act (16 U.S.C. 1531 et seq.) including whether and how the wolverine may benefit from such a designation; whether there are threats to the species from human activity, the degree to which it can be expected to increase due to a critical habitat designation, and whether that increase in threat outweighs the benefit of designation such that the designation of critical habitat may not be prudent.

(6) Specific information on the amount and distribution of wolverine habitat, including den sites.

(7) Specific information on the impacts of small population size and genetic diversity on the wolverine.

(8) Information on the projected and reasonably likely impacts of climate change on the wolverine and its habitat, including the loss of snowpack and impacts to wolverine denning habitat.

(9) Additional provisions the Service may wish to consider to conserve, recover, and manage the proposed DPS of the North American wolverine occurring in the contiguous United States.

If you submitted comments or information on the proposed rule (78 FR 7864) during the initial comment periods from February 4, 2013, to May 6, 2013, from October 31, 2013 to December 2, 2013, or from February 4, 2014, to May 6, 2014, please do not resubmit them. Any such comments are incorporated as part of the public record of this rulemaking proceeding, and we will fully consider them in the preparation of our final determination. Our final determination will take into consideration all written comments and any additional information we receive during all comment periods. The final decision may differ from the proposed rule, based on our review of all information received during this rulemaking proceeding. If we receive significant new scientific information, we may need to reopen the public comment period so that the public can comment on the new information.

You may submit your comments and materials concerning the proposed rule by one of the methods listed in ADDRESSES. We request that you send comments only by the methods described in ADDRESSES.

If you submit a comment via http://www.regulations.gov, your entire comment—including any personal identifying information—will be posted on the Web site. We will post all hardcopy comments on http://www.regulations.gov as well. If you submit a hardcopy comment that includes personal identifying information, you may request at the top of your document that we withhold this information from public review. However, we cannot guarantee that we will be able to do so.

Comments and materials we receive will be available for public inspection on http://www.regulations.gov at Docket No. FWS-R6-ES-2016-0106, and supporting documentation we used in preparing the proposed rule will be available for public inspection on the internet at https://www.fws.gov/mountain-prairie/es/wolverine.php or at http://www.regulations.gov at Docket No. FWS-R6-ES-2012-0107, or by appointment, during normal business hours, at the U.S. Fish and Wildlife Service, Montana Ecological Services Office (see FOR FURTHER INFORMATION CONTACT). You may obtain copies of the proposed rule on the Internet at http://www.regulations.gov at Docket No. FWS-R6-ES-2012-0107, or by mail from the Montana Ecological Services Office (see FOR FURTHER INFORMATION CONTACT). Please note that the 2012 docket has documents and other information related to the proposed rule, as well as the comments received and the proposed rule itself, and the 2016 docket is the correct docket for submission of comments.

The primary authors of this notice are the staff members of the Mountain Prairie Regional Office, U.S. Fish and Wildlife Service.

The authority for this action is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et seq.).

The Atlantic commercial shark fisheries are managed primarily under the authority of the Magnuson-Stevens Act. The 2006 Consolidated HMS FMP and its amendments are implemented by regulations at 50 CFR part 635. A brief summary of the background of this proposed rule is provided below. Additional information regarding Atlantic HMS management can be found in the Draft Environmental Impact Statement (DEIS) for Amendment 5b to the 2006 Consolidated HMS FMP (Amendment 5b), the 2006 Consolidated HMS FMP and its amendments, the annual HMS Stock Assessment and Fishery Evaluation (SAFE) Reports, and online at http://www.nmfs.noaa.gov/sfa/hms/.

NMFS has prohibited the retention of dusky sharks in commercial and recreational fisheries since 2000. In 2008, in response to a 2006 stock assessment declaring dusky sharks to be overfished with overfishing occurring despite this complete prohibition, NMFS adopted a rebuilding plan for the stock. This rebuilding plan, set out in Amendment 2 to the Consolidated HMS FMP, undertook a suite of measures to address dusky shark overfishing, focusing primarily on bycatch of the species in other shark fisheries. Major components of this plan—which are unchanged by this action—include a continued prohibition on retention of dusky sharks (§§ 635.22(c)(4) and 635.24(a)(5)), time/area closures (§ 635.21(d)), and the prohibition of landing sandbar sharks (the historic target species for the large coastal shark fishery) outside of the shark research fishery along with significant retention limit reductions in the bottom longline fishery where interactions were commonly occurring (§§ 635.24(a)(1), (2), and (3)). The terminal year for rebuilding was set at 2108, consistent with the assessment, which concluded that the stock could rebuild within 100 to 400 years. In 2011, three years into this 100-year rebuilding plan, a benchmark stock assessment for dusky sharks was completed through the Southeast Data, Assessment, and Review (SEDAR) 21 process (76 FR 62331, October 7, 2011), the first assessment for dusky sharks conducted within the SEDAR process. The 2011 stock assessment provided an update to a 2006 dusky shark stock assessment and concluded that the stock remained overfished with overfishing occurring.

On October 7, 2011 (76 FR 62331), NMFS made stock status determinations for several shark species based on the results of the SEDAR 21 process. NMFS determined in the notice that dusky sharks, a prohibited species, were still overfished and still experiencing overfishing (i.e., their stock status has not changed from a 2006 assessment). The stock assessment recommended a decrease in dusky shark mortality of 58 percent against 2009 levels. NMFS announced its intent to prepare an Environmental Impact Statement (EIS) for Amendment 5 to the 2006 Atlantic Consolidated HMS FMP, which would assess the potential effects on the human environment of additional action proposed through rulemaking to rebuild and end overfishing of several stocks assessed in SEDAR 21, including dusky sharks, consistent with the Magnuson-Stevens Act.

NMFS considered alternatives to rebuild several overfished Atlantic shark species, including dusky sharks, in Draft Amendment 5 (77 FR 70552, November 26, 2012). The proposed measures were designed to reduce fishing mortality and effort, while ensuring that a limited sustainable shark fishery for certain species could be maintained consistent with legal obligations and the 2006 Consolidated HMS FMP. NMFS received substantial public comment disputing the basis for the proposed dusky shark measures, and NMFS decided further analysis was necessary on those measures in a separate FMP amendment, EIS, and proposed rule. NMFS finalized management measures for the other Atlantic shark species included in Draft Amendment 5 in the Final Amendment 5a and associated final rule (78 FR 40318, July 3, 2013), while announcing that dusky shark management measures would be included in an upcoming, separate rulemaking known as Amendment 5b (i.e., this rule).

NMFS prepared a Predraft for Amendment 5b in March 2014 that considered the feedback received on Draft Amendment 5, solicited additional public input, and consulted with its Advisory Panel at the Spring 2014 meeting. The Predraft considered alternatives that were not included in Draft Amendment 5, as well as new information.

Following the Predraft for Amendment 5b, additional information regarding dusky sharks became available that was not available at the time of the SEDAR 21 stock assessment. NMFS, in response to two petitions from environmental groups regarding listing dusky sharks under the Endangered Species Act (ESA), conducted an ESA Status Review for the Northwest Atlantic population of dusky sharks, which was completed in October 2014. That status review included an updated analysis of three fishery-independent surveys, the Northeast Fisheries Science Center (NEFSC) Coastal Shark Bottom Longline Survey (NELL), the Virginia Institute of Marine Science Shark Longline Survey (VIMS LL), and the University of North Carolina Shark Longline Survey (UNC LL), using the same methodology as the SEDAR 21 Data Workshop (McCandless et al., 2014). The updated analysis included data from 2010—2012 and showed an increasing trend in dusky shark indices of abundance for all three surveys since 2009, the terminal year of data used for dusky sharks in the SEDAR 21 stock assessment. The ESA Status Review Team concluded that, based on the most recent stock assessment, abundance projections, updated analyses, and the potential threats and risks to population extinction, the dusky shark population in the Northwest Atlantic and Gulf of Mexico has a low risk of extinction currently and in the foreseeable future. On December 16, 2014, NMFS announced a 12-month finding that determined that the Northwest Atlantic and Gulf of Mexico population of dusky sharks did not warrant listing under the ESA at that time (79 FR 74954).

NMFS applied additional restrictions in the shark research fishery to reduce dusky shark mortality in 2013 (refer to the Amendment 5b DEIS; see ADDRESSES). This included establishing a dusky shark interaction cap for the entire shark research fishery of 45 dusky sharks per year, with more specific caps within the regions, which has been an effective way to minimize dusky shark dead discards within the limited shark research fishery, which only involves 6 to 10 participants annually.

By Fall 2015, as described in an HMS staff presentation to its Advisory Panel, the reductions in dusky shark mortality since 2009, and the increasing population trends from fishery-independent surveys, had indicated that management actions may have already reduced dusky shark mortality to levels prescribed by the SEDAR 21 stock assessment (i.e., reduced mortality by at least 58 percent against 2009 levels). In light of this updated information, the Southeast Fisheries Science Center (SEFSC) prioritized an update of the SEDAR 21 dusky shark stock assessment using data through 2015, to be completed in summer 2016. It was determined that further action on Amendment 5b should wait until after the completion of the assessment update to ensure that it was based on the best available scientific information.

On October 27, 2015, the environmental advocacy organization Oceana filed a complaint against NMFS in Federal district court alleging violations of the Magnuson-Stevens Act and Administrative Procedure Act with respect to delays in taking action to rebuild and end overfishing of dusky sharks. A settlement agreement was reached between NMFS and the Plaintiffs on May 18, 2016, regarding the timing of the pending agency action. This settlement acknowledged that NMFS was in the process of developing an action to address overfishing and rebuilding of dusky sharks and that an assessment update was ongoing and stipulated that, based upon the results of the assessment update, NMFS would submit a proposed rule to the Federal Register no later than October 14, 2016.

A draft of the SEDAR 21 stock assessment update for dusky sharks became available in July 2016 and underwent internal NMFS peer review in August 2016. The assessment update added 2010-2015 data inputs from the same data sources vetted and approved in SEDAR 21 (fishery-dependent and -independent data, relative effort series, etc.) to the accepted models in order to update the status of the stock using the most recent data. Five model scenarios were run, all of which were considered to be plausible states of nature according to SEDAR 21 (i.e., no single model is considered preferred to the others). The peer reviewers did not identify any issues or concerns with the methods applied or the results or conclusions of the assessment update. However, SEDAR 21 and the 2016 update noted a high level of uncertainty in the input observations, as well as the model outputs, beyond that of many other Atlantic shark stock assessments. The final SEDAR 21 stock assessment update report was made available in September 2016 and is available on the SEDAR Web site (http://sedarweb.org/sedar-21).

Despite including much of the same data as those used in the 2014 ESA Dusky Shark Status Review Report (McCandless et al., 2014), which suggested mostly positive trends in dusky shark relative abundance, the 2016 assessment update concluded that the stock is still overfished and experiencing overfishing, although the level of overfishing has decreased compared to previous assessments and is low. Specifically, Spawning Stock Fecundity (SSF) relative to SSFMSY (proxy biomass target) ranges from 0.41 to 0.64 (i.e., overfished) (median = 0.53). The fishing mortality rate (F) in 2015 relative to FMSY is estimated to be 1.08-2.92 (median = 1.18) (values >1 indicate overfishing).

The rebuilding year was also updated according to the new model projections. The target rebuilding year was calculated as the amount of time needed for the stock to reach the target (SSFMSY) with a 70% probability in the absence of fishing mortality (F=0) plus one mean generation time (40 years). The updated projections estimate that the target rebuilding years range from 2084-2204, with a median of 2107. The previous rebuilding year under SEDAR 21 was 2108.

In order to achieve rebuilding by 2107 with a 50% probability, the final models projected that F on the stock would have to be reduced 24-80% (median = 35%) from 2015 levels. The assessment update states that the stock can sustain small amounts of fishing mortality during its rebuilding. When developing measures to address overfishing or rebuilding in HMS fisheries, NMFS' general approach is that measures should have at least a 50-percent probability of success in achieving those goals. For Atlantic highly migratory sharks, however, NMFS has, since 1999, typically used a 70-percent probability for sharks, in light of their late age to maturity, reproduction, population growth rate, and other considerations. Given particular issues specific to the 2016 SEDAR 21 dusky shark assessment update (explained below), NMFS used the F reduction associated with the 50-percent probability to develop Draft Amendment 5b.

While peer reviewers did not identify any issues with how the 2016 assessment update was conducted, SEDAR 21 and the 2016 update noted a high level of uncertainty in the input observations, as well as the model outputs, beyond that of many other Atlantic shark stock assessments. Data on dusky sharks is limited, given the retention prohibition and fact that interactions with prohibited sharks are rare events, and dusky shark sharks are often misidentified. Data input to the models came from different types of fishing vessels/gears and time series collected by different entities, including the Atlantic Shark Bottom Longline Observer Program, Shark Bottom Longline Research Fishery, the Atlantic Pelagic Observer Program, the recreational Large Pelagics Survey, the Northeast Fisheries Science Center's Bottom Longline Survey, and the Virginia Institute of Marine Science's Bottom Longline Survey. Based on these data, the five plausible model scenarios in the 2016 assessment update produced a very wide range of estimates (overfishing and overfished status) and outcomes (F reductions, rebuilding timelines, etc.). In light of the range of estimates and outcomes, NMFS used the median of the five scenarios in its development of measures in Draft Amendment 5b to address overfishing and rebuilding of dusky sharks. Given the range of plausible scenarios from the assessment update, using the median of multiple scenarios is an acceptable method because it is an objective approach for reconciling a range of management options. It is also consistent with the management approach to similar situations in other fisheries (e.g., New England Fishery Management Council's Scientific and Statistical Committee's recommendation for yellowtail flounder in September 2009; Scott et al. 2016).

Because of the above issues, NMFS decided it was appropriate from a scientific, technical perspective to use the F reduction associated with the 50-percent probability when developing Draft Amendment 5b. While NMFS typically uses a 70-percent probability for Atlantic highly migratory shark species, the 2016 update has a higher level of uncertainty than other shark assessments and presents a more pessimistic view of stock status than was expected based on our preliminary review of the same information and other available information. Such information includes the information reviewed in the ESA Status Review, reductions in U.S. fleet fishing effort due to management actions, and updated age and growth information indicating that dusky sharks are more productive than previously thought (Natanson et al. 2014). This information could not be used in the 2016 assessment update, because assessment updates only incorporate data inputs (e.g., time series, life history parameters, etc.) that were previously vetted through the SEDAR process and approved as part of the most recent benchmark assessment. Here, that was the 2011 benchmark stock assessment (SEDAR 21). Based on its review of the 2016 update, understanding about the operation of the HMS fisheries under current management measures, and other available information, the F estimate associated with the 50-percent probability more accurately reflects current fishing pressure and accounts for the new information on dusky shark productivity than the F estimate associated with the 70-percent probability. From a statistical perspective, the wider confidence band in the projections results in the F estimate associated with a 70-percent probability being substantially lower than the apical value. Thus, the F reduction associated with 70-percent goes well beyond what we would consider appropriately precautionary even for species with relatively slow life history such as sharks (refer to the Amendment 5b DEIS for more details; see ADDRESSES). NMFS also notes that the rebuilding year (i.e., length of time the species could rebuild with no fishing mortality plus one mean generation time) was calculated using a 70-percent probability, as is typically done in assessments, which additionally increases the likelihood of achieving rebuilding within the mandated time period.

Therefore, based on the 2016 assessment update, NMFS needs to reduce dusky shark fishing mortality by approximately 35% relative to 2015 levels to rebuild the stock by the year 2107. NMFS also needs to address overfishing, but the level of overfishing is not high (median F2015/FMSY is 1.18). NMFS solicits public comment on its approach in Draft Amendment 5b based on the 2016 update, particularly ideas on different approaches and any scientific support for them.

The Magnuson-Stevens Act requires that each FMP establish a mechanism for specifying ACLs at a level such that overfishing does not occur, including measures to ensure accountability (AMs) (16 U.S.C. 1853(a)(15)). In 2010, NMFS addressed these requirements for Atlantic highly migratory shark stocks in Amendment 3 to the 2006 Consolidated HMS FMP (Amendment 3) (NMFS 2010), including sharks in the prohibited shark complex, which includes dusky sharks. Draft Amendment 5b clarifies that the ACL for the 19 species of sharks in the prohibited shark complex is zero. NMFS believes that an ACL of zero is appropriate and, along with existing and proposed conservation and management measures, will prevent overfishing.

In its proposed revisions to the NS 1 guidelines (80 FR 2786; January 20, 2015), NMFS explains in § 600.310(g)(3) that if an ACL is set equal to zero and the AM for the fishery is a closure that prohibits fishing for a stock, additional AMs are not required if only small amounts of catch (including bycatch) occur, and the catch is unlikely to result in overfishing. According to the available analyses, prohibited shark species—basking sharks (Campana 2008), night sharks (Carlson et al. 2008), sand tiger sharks (Carlson et al., 2009), white sharks (Curtis et al. 2014), and bigeye thresher sharks (Young et al. 2016)—are not experiencing overfishing. While such analyses have not been completed for all other prohibited shark species, there is no information suggesting that overfishing is occurring on other members of this complex. In addition, commercial and recreational retention of prohibited sharks is prohibited, and there is only a small amount of bycatch occurring for the complex. The annual number of observed bycatch mortalities of prohibited sharks ranged from 293 to 1,829 sharks per year over the time series, and the most recent observed three-year average annual mortality for all sharks in the complex was 498 sharks (refer to the DEIS for this action for more detail; see ADDRESSES).

NMFS acknowledges that, in addition to the small amount of bycatch, there is also information on a small amount of occasional prohibited shark landings. Based on observer and other data and input from the HMS AP, NMFS believes that these landings most likely are due to misidentification issues and lack of awareness of shark fishing regulations, which would be addressed through this action. Even though dusky sharks are experiencing overfishing, NMFS believes that an ACL of zero is still appropriate for the prohibited shark complex. The estimated level of overfishing for dusky sharks is not high (median F2015/FMSY is 1.18; values >1 indicates overfishing), and measures under Draft Amendment 5b and this proposed rule are expected to prevent this overfishing (See “Proposed Measures” below.) NMFS notes that there would be policy and scientific/data concerns if we were to specify an ACL other than zero. As noted earlier, there was a high level of uncertainty in the 2016 assessment update, given limited data on dusky sharks, multiple data sources, and five plausible model scenarios. The update had five different total allowable catch (TAC) estimates ranging from 7,117 to 47,400 lb (3.2 to 21.5 mt) dressed weight (median = 27,346 lb (12.4 mt) dressed weight). NMFS does not have a basis for picking one model over another, and is concerned that setting an ACL based on the highly uncertain TAC estimates could encourage increased catch. Retention of dusky sharks is prohibited, thus NMFS believes that the ACL for dusky sharks (along with other species in the prohibited shark complex) should be zero.

NMFS is proposing additional measures in Draft Amendment 5b and this proposed rule to prevent overfishing of dusky sharks (see “Proposed Measures” below). These measures are in addition to previously-adopted shark management measures. NMFS considers these and other management measures for dusky sharks (e.g., prohibition on retention) to be AMs. After considering the proposed revisions to the NS1 guidelines at 50 CFR 600.310(g)(3), NMFS does not believe additional AMs are needed for dusky sharks or other prohibited sharks. Over the past years, NMFS has taken significant regulatory action that has reduced fishing effort and mortality on shark species. Most significantly, Amendment 2 regulations, which were implemented in July 2008 (73 FR 35778, June 24, 2008, as corrected at 73 FR 40658, July 15 2008), dramatically changed how the directed shark fishery (which had frequent interactions with dusky sharks) operates by, among other things, reducing the commercial trip limit from 4,000 lb (1.81 mt) dw to 36 non-sandbar LCS per trip (approximately 1,213 lb or 0.55 mt dw), significantly reducing the sandbar quota and prohibiting the retention of sandbar sharks outside a limited shark research fishery, and requiring that sharks be landed with their fins attached. Because dusky sharks have a similar distribution to sandbar sharks, and they were frequently caught together, measures that reduced sandbar shark catches also reduced dusky shark bycatch. To address bycatch of dusky sharks on bottom longline gear, the quota for sandbar sharks was reduced by 80 percent, leaving only a small, very closely monitored research fishery. Other measures to reduce dusky shark bycatch, which remain in place, included limiting the number of vessels authorized to land sandbar sharks and setting a finite number of trips that would be taken targeting sandbar sharks in the research fishery. Once this quota was met, there would be no more targeting or possession of sandbar sharks and other shark species within the shark research fishery. Implementing a more restrictive retention limit for non-sandbar LCS (e.g., 36 non-sandbar LCS/vessel/trip for directed permit holders) was also adopted to result in reduced fishing effort targeting sharks with bottom longline (BLL) gear. NMFS also adopted measures that would not allow dusky sharks to be collected for public display, limiting the number of dusky sharks authorized for research, not allowing certain species of sharks that look like dusky sharks to be possessed in recreational fisheries, maintaining the mid-Atlantic shark closed area, and implementing additional time/area closures for BLL gear as recommended by the South Atlantic Fishery Management Council in its Amendment 14. These measures have already reduced effort and fishing mortality, which will increase the likelihood of rebuilding dusky sharks.

Additionally, Amendment 7 to the 2006 Consolidated HMS FMP in 2015 effected management measures in the pelagic longline fishery by implementing measures to control bluefin tuna bycatch in that fishery. As a result, pelagic longline fishery management and monitoring has changed significantly and, at least in the initial years of management under these controls, effort has decreased.

The time series NMFS used to evaluate the impact of conservation and management measures and fishing mortality on the prohibited shark complex begins in 2008 to coincide with the implementation of Amendment 2 and ends in 2015, the most recent year for which data are available. Bycatch data are not available in as timely a manner as data on landed catch, and interactions with prohibited sharks are rare events, which can be highly variable from year to year. Thus, three-year rolling averages were used to smooth interannual variability in the observed catches.

On an annual basis, NMFS will continue to monitor the prohibited shark complex, based on a comparison of the most recent three-year average mortality to previous three-year averages to evaluate the impact of conservation and management measures, and evaluate fishing mortality on the prohibited shark complex. NMFS anticipates that bycatch of dusky and other prohibited sharks will continue to occur; in other words, the three-year averages will be higher than zero. However, small amounts of bycatch are permissible where the ACL is set to zero and the bycatch is small and does not lead to overfishing. For the reasons discussed above, NMFS does not believe that further AMs are needed to prevent overfishing. If significant changes in the three-year average mortality occur, NMFS would evaluate trends in relative abundance data from species within the prohibited shark complex and evaluate current fisheries practices and look for patterns in bycatch mortality of species within the complex to determine if additional measures are needed to address overfishing.

NMFS solicits public comment on its approach to the ACL/AMs for the prohibited shark complex and whether other approaches might address the scientific and management concerns noted above.

The objectives of Draft Amendment 5b are to end overfishing and rebuild the dusky shark stock. This section summarizes NMFS' proposed, preferred measures. NMFS expects that these measures will prevent overfishing and achieve at least a 35% mortality reduction for dusky sharks to ensure stock rebuilding with at least 50% probability in conjunction with the measures already in place. A description of other alternatives analyzed is provided in the Initial Regulatory Flexibility Analysis (IRFA) summary, below. NMFS' detailed analysis of a range of alternatives is in the DEIS for Draft Amendment 5b (see ADDRESSES for how to get a copy of the DEIS). In developing the alternatives, NMFS considered the existing rebuilding plan, other conservation and management measures that have been implemented in the HMS fisheries since 2008 and that have affected the shark fisheries or shark bycatch in other fisheries, public response to the results of SEDAR 21 and the 2016 SEDAR 21 update, public comments received on Draft Amendment 5 and the Amendment A5b Predraft and comments at Advisory Panel meetings during the course of development of this action.

A number of alternatives that were considered and/or commented on during the development of this action are not preferred alternatives at this time, because they are not needed to meet the objectives of the amendment and would result in negative economic impacts, would not meet the objectives of the amendment, would not be logistically/administratively feasible, are not scientifically supportable, and/or they would result in other unnecessary, negative impacts, as described in the DEIS (see ADDRESSES). In general terms, these non-preferred alternatives included requirements for vessels to carry shark identification placards, prohibiting recreational retention of all ridgeback sharks, increasing the recreational minimum size limit, allowing only catch and release of all sharks in the recreational fishery, limiting the number of hooks that could be deployed by pelagic longline vessels, dusky shark time-area closures, closure of the pelagic longline fishery, and individual dusky shark bycatch quotas.

As explained in this proposed rule and the DEIS, NMFS has already taken significant actions that reduce fishing effort and mortality. After extensive review of available management measures, NMFS has determined that the proposed measures will prevent overfishing and rebuild dusky sharks. However, we specifically request comment from the public on other potential management measures and any scientific, policy, or other support for them. In response to public comment, NMFS may make changes in Final Amendment 5b and the final rule by modifying the proposed measures or adopting different or additional measures, which are not currently preferred.

The two proposed recreational measures address permitting (Alternative A2) and gear use (Alternative A6a). The first proposed measure would require HMS permit holders that recreationally fish for, retain, possess, or land sharks to obtain a “shark endorsement,” which would require completing an online shark identification and fishing regulation training course, before they will be permitted to fish for, retain, possess, or land sharks. This would include HMS Angling and Charter/Headboat permit holders, as well as General category and Swordfish General Commercial permit holders when participating in a registered HMS fishing tournament. Obtaining the shark endorsement would be included in the annual HMS Angling, Charter/Headboat, Atlantic tunas General category, and Swordfish General Commercial permit application or annual renewal process and would not result in any additional fees beyond the cost of the permit itself. NMFS requests public input on how to most effectively implement the requirement through this process, including the appropriate effective date and implementation strategy. Unlike changing permit categories (which can only be done within 45 calendar days of the date of issuance of the permit), vessel owners could obtain a shark endorsement, which would be added to their relevant permit, throughout the year. An online quiz, administered during the application or renewal process, would be required in order to obtain the shark endorsement. This online quiz would focus on identification of prohibited species (e.g., dusky sharks), current recreational rules and regulations, and safe handling instructions. Currently, retention of dusky sharks is prohibited in the recreational fishery. Mortality or landings in the recreational fishery, then, is likely a result of either species misidentification or a lack of knowledge about prohibited shark species regulations or safe handling to minimize harm to accidentally caught fish. The application process for the shark endorsement would also provide an opportunity for focused outreach, and the list of shark endorsement holders would allow for more targeted surveys, increasing the reliability of recreational shark catch estimates. As a result of this measure, NMFS expects accidental retention of dusky sharks to decrease and for dusky shark fishing mortality to decrease in recreational fisheries. Therefore, implementing this measure would likely result in direct short- and long-term moderate beneficial ecological impacts.

The second proposed measure would require HMS permit holders that recreationally fish for, retain, possess, or land sharks (the same permit holders as those described above) to use circle hooks when fishing for, retaining, possessing, or landing sharks. Any shark caught on a hook other than a circle hook would have to be released. This requirement is intended to apply across the recreational shark fishery. To ensure that the measure encompasses all shark fishing activity, we also specify that a person on board an HMS-permitted vessel fishing with natural baits and using wire or heavy (200 lb test or greater) monofilament or fluorocarbon leaders (i.e., the terminal tackle most commonly used for shark fishing) would be presumed to be fishing for sharks. NMFS is specifically inviting public comment on whether this approach will ensure that the measure applies to the entire fishery or whether different indicators of recreational shark fishing should be adopted.

By requiring circle hooks across the recreational shark fishery, dusky shark mortality is expected to decrease. Most evidence suggests that circle hooks reduce shark at-vessel and post-release mortality rates without significantly reducing catchability compared to J-hooks, although it varies by species, gear configuration, bait, and other factors. Willey et al. (2016) found that 3% of sharks caught recreationally with circle hooks were deep hooked while 6% caught on J-hooks were deep hooked. Campana et al. (2009) observed that 96% of sharks that were deep hooked were severely injured or dead while 97% of sharks that were hooked superficially (mouth or jaw) were released healthy and with no apparent trauma. As deep hooked sharks are more likely to die, Willey et al.'s (2016) results indicate circle hooks could reduce mortality of sharks deep-hooked by J-hooks by approximately 48 percent (i.e., a 50 percent reduction from 96 percent deep hooked sharks). For this reason, this alternative would likely have direct moderate beneficial impacts in both the short- and long-term for dusky sharks. Requiring these hooks whenever this gear/bait combination is used and further specifying that sharks may not be retained unless circle hooks have been used is expected to reduce dusky shark mortality because dusky sharks that are inadvertently caught in the recreational fishery would be more easily released in better condition, reducing dead discards and post-release mortality.

Under these recreational measures combined, HMS permitted recreational vessels without a shark endorsement and/or not fishing with circle hooks would be prohibited from retaining any sharks.

In total, the DEIS considers nine main commercial alternatives that cover education, outreach, gear, and time/area measures for pelagic longline, bottom longline, and shark gillnet fisheries. The four commercial fishery measures that are proposed would address dusky shark post-release mortality (Alternatives B3 and B9), avoidance (Alternative B6), and outreach and education (Alternatives B5 and B6) and thus would decrease fishing mortality of dusky sharks in the commercial fisheries. The first proposed measure would require that all pelagic longline fishermen release all sharks that are not being boarded or retained by using a dehooker, or by cutting the gangion no more than three feet from the hook. This alternative would reduce post-release mortality on dusky sharks because using a dehooker or cutting the gangion no more than three feet from the hook would reduce the amount of trailing gear attached to released dusky sharks. A study on recreationally caught thresher sharks (Sepulveda et al. 2015), suggested that thresher sharks that had ~2 m of trailing gear had 88% higher mortality rates than those without. While this study focuses on thresher sharks and not dusky sharks, its conclusion regarding the effects of trailing gear on post-release mortality rates of sharks can be presumed to be generally applicable to other sharks, although further research would be needed to better quantify the percent mortality reductions that could be expected under different species and gear combinations. NMFS Tech Memo OPR-29 on marine turtle mortality indicates that reducing gear left on sea turtles reduces post-interaction mortality of mouth-hooked turtles by 25-33%, further supporting the approach that reducing trailing gear on animals generally improves post-release survival. Because it would apply to all sharks that are not being retained, it would also reduce misidentification problems that occur in identifying dusky sharks from other shark species, because fishermen would have to cut the gangion closer to the shark, allowing a better view for identification purposes. Therefore, implementing this measure is anticipated to have direct short- and long-term minor, beneficial ecological impacts.

The second proposed measure would require additional training on shark identification and safe handling for HMS permitted pelagic longline, bottom longline, and shark gillnet vessels. The course would be taught in conjunction with current Protected Species Safe Handling, Release, and Identification workshops that these vessel owners and operators are already required to attend. The training course would provide information regarding shark identification and regulations, as well as best practices to avoid interacting with dusky sharks and how to minimize mortality of dusky sharks and other prohibited species caught as bycatch. This training course requirement provides outreach to those who are likely to interact with dusky sharks, and should decrease interactions and post-release mortality of dusky sharks. Implementing this measure could result in direct, moderate, beneficial ecological impacts after these vessel owners and operators complete the training course.

In the third proposed measure, NMFS would develop additional outreach materials for commercial fisheries regarding shark identification, and require that all HMS permitted pelagic longline, bottom longline, and shark gillnet vessels abide by a dusky shark fleet communication and relocation protocol. The protocol would require vessels to report the location of dusky shark interactions over the radio to other vessels in the area and that subsequent fishing sets on that fishing trip could be no closer than 1 nautical mile from where the encounter took place. Providing the fleet with more information regarding dusky shark locations and avoiding areas and conditions where dusky sharks are located should reduce dusky shark bycatch. This additional awareness from enhanced outreach methods and the fleet communication and relocation protocol would have direct short- and long-term minor beneficial ecological impacts as it would help reduce bycatch of dusky sharks.

The fourth proposed measure would require the use of circle hooks by HMS directed limited access shark permit holders fishing with bottom longline gear. Circle hooks are already required in the pelagic longline fishery, and this would extend that requirement to the bottom longline fishery to help reduce dusky shark mortality. Currently, approximately 25% of bottom longline vessels do not solely use circle hooks, so this measure would result in additional reductions in dusky shark post-release mortality on those vessels that switch to circle hooks. As in the recreational fishery circle hook measure described above, implementing a circle hook requirement would reduce post-release mortality rates and have direct moderate beneficial impacts in both the short- and long-term for dusky sharks.

NMFS is requesting comments on the alternatives and analyses described in this proposed rule and contained in Draft Amendment 5b and its DEIS, IRFA and RIR. Comments may be submitted via http://www.regulations.gov, mail, or fax. Comments may also be submitted at a public hearing (see Public Hearings and Special Accommodations below). We solicit comments on this proposed rule by December 22, 2016 (see DATES and ADDRESSES).

Comments on this proposed rule may be submitted via http://www.regulations.gov, mail, or fax and comments may also be submitted at a public hearing. NMFS solicits comments on this proposed rule by December 22, 2016. During the comment period, NMFS will hold 6 public hearings and 1 conference call for this proposed rule. The hearing locations will be physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Guý DuBeck at 301-427-8503, at least 7 days prior to the meeting. NMFS has also asked to present information on the proposed rule and draft Amendment 5b to the Caribbean, Gulf of Mexico, South Atlantic, Mid-Atlantic, and New England Fishery Management Councils and the Atlantic States Marine Fisheries Commissions at their meetings during the public comment period. Please see their meeting notices for dates, times, and locations. In addition, NMFS will have an HMS Advisory Panel meeting on December 1-2, 2016, to discuss this rulemaking. NMFS will announce the location and times of HMS Advisory Panel meeting in a future Federal Register notice.

The public is reminded that NMFS expects participants at the public hearings to conduct themselves appropriately. At the beginning of each public hearing, a representative of NMFS will explain the ground rules (e.g., alcohol is prohibited from the hearing room; attendees will be called to give their comments in the order in which they registered to speak; each attendee will have an equal amount of time to speak; and attendees should not interrupt one another). At the beginning of the conference call, the moderator will explain how the conference call will be conducted and how and when attendees can provide comments. The NMFS representative will attempt to structure the meeting so that all attending members of the public will be able to comment, if they so choose, regardless of the controversial nature of the subject(s). Attendees are expected to respect the ground rules, and, if they do not, they may be asked to leave the hearing or may not be allowed to speak during the conference call.

Pursuant to the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that the proposed rule is consistent with the 2006 Consolidated HMS FMP and its amendments, other provisions of the Magnuson-Stevens Act, ATCA, and other applicable law, subject to further consideration after public comment.

This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

NMFS prepared a DEIS for this proposed rule that discusses the impact on the environment that would result from this rule. A copy of the DEIS is available from NMFS (see ADDRESSES). The Notice of Availability of the DEIS is publishing in the Federal Register on the same day as this proposed rule. A summary of the impacts of the alternatives considered is described above.

This proposed rule would require HMS-permitted recreational fishermen to obtain a shark endorsement in order to fish for, retain, possess, or land sharks. Public comment is sought regarding: whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection of information to (enter office name) at the ADDRESSES above, and by email to [email protected] or fax to (202) 395-7285.

Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to, a penalty for failure to comply with, a collection-of-information subject to the requirements of the PRA, unless that collection-of-information displays a currently valid OMB Control Number.

An initial regulatory flexibility analysis (IRFA) was prepared, as required by section 603 of the Regulatory Flexibility Act (RFA). The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities. A summary of the analysis follows. A copy of this analysis is available from NMFS (see ADDRESSES).

As described in the preamble of this rule and in the Draft Amendment 5b DEIS (see ADDRESSES), the proposed action is designed to provide measures in addition to those previously adopted to further address the overfished and overfishing occurring status of the dusky shark stock. NMFS previously considered alternatives for management of dusky sharks in Draft Amendment 5, which proposed measures that were designed to reduce fishing mortality and effort in order to prevent overfishing and rebuild various overfished Atlantic shark species, including dusky sharks, while ensuring that a limited sustainable shark fishery for certain species could be maintained consistent with legal obligations and the 2006 Consolidated HMS FMP. After reviewing all of the comments received, NMFS determined further analyses were warranted on measures pertaining to dusky sharks in a separate FMP amendment (Amendment 5b), EIS, and this proposed rule.

The objectives of, and legal basis for, this proposed rule are summarized in the preamble of this rule and in the Draft Amendment 5b DEIS (see ADDRESSES).

This proposed rule is expected to directly affect commercial pelagic longline, bottom longline, shark gillnet, and recreational shark fishing vessels that possess HMS permits. To fish for Atlantic HMS, pelagic longline vessels must possess an Atlantic shark limited access permit, an Atlantic swordfish limited access permit, and an Atlantic Tunas Longline category permit. For the recreational management measures, the proposed management measures would only directly apply to small entities that are Charter/Headboat permit holders that provide for-hire trips that target sharks. Other HMS recreational fishing permit holders are considered individuals, not small entities.

For RFA purposes only, NMFS has established a small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing (see 50 CFR 200.2). A business primarily engaged in commercial fishing (NAICS code 11411) is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and has combined annual receipts not in excess of $11 million for all its affiliated operations worldwide. The Small Business Administration (SBA) has established size standards for all other major industry sectors in the U.S., including the scenic and sightseeing transportation (water) sector (NAICS code 487210, for-hire), which includes charter/party boat entities. The Small Business Administration (SBA) has defined a small charter/party boat entity as one with average annual receipts (revenue) of less than $7.5 million.

Regarding those entities that would be directly affected by the recreational management measures, HMS Angling (Recreational) category permits are typically obtained by individuals who are not considered businesses or small entities for purposes of the RFA. Additionally, while Atlantic Tunas General category and Swordfish General commercial permit holders hold commercial permits and are usually considered small entities, because the proposed management measures would only affect them when they are fishing under the recreational regulations for sharks during a registered tournament, NMFS is not considering them small entities for this rule. However, because vessels with the HMS Charter/Headboat category permit are for-hire vessels, these permit holders can be regarded as small entities for RFA purposes. At this time, NMFS is unaware of any charter/headboat businesses that could exceed the SBA receipt/revenue thresholds for small entities. Overall, the recreational alternatives would impact a portion of the 3,596 HMS Charter/Headboat permit holders interested in shark fishing.

Regarding those entities that would be directly affected by the commercial management measures, the average annual revenue per active pelagic longline vessel is estimated to be $187,000 based on the 170 active vessels between 2006 and 2012 that produced an estimated $31.8 million in revenue annually. The maximum annual revenue for any pelagic longline vessel between 2006 and 2015 was less than $1.9 million, well below the NMFS small business size standard for commercial fishing businesses of $11 million. Other non-longline HMS commercial fishing vessels typically generally earn less revenue than pelagic longline vessels. Therefore, NMFS considers all Atlantic HMS commercial permit holders to be small entities. The preferred commercial alternatives would apply to the 280 Atlantic tunas Longline category permit holders and 224 directed shark permit holders. Of these 280 permit holders, only 136 have Individual Bluefin Quotas (IBQ) shares required to go commercial pelagic longline fishing.

NMFS has determined that the preferred alternatives would not likely directly affect any small organizations or small government jurisdictions defined under RFA. More information regarding the description of the fisheries affected, and the categories and number of permit holders, can be found in Chapter 3 of the Draft Amendment 5b DEIS (see ADDRESSES).

Several of the preferred alternatives in Draft Amendment 5b would result in reporting, record-keeping, and compliance requirements that may require new Paperwork Reduction Act (PRA) filings and some of the preferred alternatives would modify existing reporting and record-keeping requirements, and add compliance requirements. NMFS estimates that the number of small entities that would be subject to these requirements would include the Atlantic tuna Longline category (280), Directed and Incidental Shark Limited Access (224 and 275, respectively), and HMS Charter/Headboat category (3,596) permit holders.

The preferred recreational alternative, A2, would require recreational fishermen fishing for, retaining, possessing, or landing sharks to obtain a shark endorsement in addition to other existing permit requirements. Obtaining the shark endorsement would be included in the online HMS permit application and renewal processes and would require the applicant to learn about prohibited shark species identification, regulations, and safe handling guidelines, and then complete a short quiz focusing on shark species identification. The applicant would simply need to indicate the desire to obtain the shark endorsement, after which he or she would be directed to a short online quiz that would take minimal time to complete. Adding the endorsement to the permit and requiring applicants to take the online quiz to obtain the endorsement will require a modification to the existing PRA for the permits.

Alternative B5, a preferred alternative, would require completion of shark identification and fishing regulation training as a new part of all Safe Handling and Release Workshops for HMS pelagic longline (PLL), BLL, and shark gillnet vessel owners and operators. The training course would provide information regarding shark identification and regulations, as well as best practices to avoid interacting with dusky sharks and how to minimize mortality of dusky sharks caught as bycatch. Compliance with this course requirement would be mandatory and be a condition for permit renewal. A certificate would be issued to all commercial pelagic longline vessel owners indicating compliance with this requirement and the certificate would be required for permit renewal.

Alternative B6, a preferred alternative, would require that all vessels with an Atlantic shark commercial permit and fishing with pelagic longline, bottom longline, or shark gillnet gear abide by a dusky shark fleet communication and relocation protocol. The protocol would require vessels to report the location of dusky shark interactions over the radio to other pelagic longline, bottom longline, or shark gillnet vessels in the area and that subsequent fishing sets on that fishing trip could be no closer than 1 nautical mile (nm) from where the encounter took place.Identification of All Relevant Federal Rules Which May Duplicate, Overlap, or Conflict with the Proposed Rule

The proposed rule would not conflict with any relevant regulations, Federal or otherwise. Description of Any Significant Alternatives to the Proposed Rule That Accomplish the Stated Objectives of the Applicable Statutes and That Minimize Any Significant Economic Impact of the Proposed Rule on Small Entities

The RFA (5 U.S.C. 603 (c) (1)-(4)) lists four general categories of “significant” alternatives that would assist an agency in the development of significant alternatives. These categories of alternatives are:

In order to meet the objectives of this proposed rule, consistent with all legal requirements, NMFS cannot exempt small entities or change the reporting requirements only for small entities because all the entities affected are considered small entities. Thus, there are no alternatives discussed that fall under the first and fourth categories described above. Under the third category, “use of performance rather than design standards,” NMFS considers Alternative B5, which would provide additional training for pelagic longline, bottom longline, and shark gillnet fishermen, to be a performance standard rather than a design standard. Alternative B5's training requirement will apply to all commercial vessels and take place in conjunction with other currently required training workshops. As described below, NMFS analyzed several different alternatives in this proposed rulemaking and provides the rationale for identifying the preferred alternative to achieve the desired objective.

In this rulemaking, NMFS considers two different categories of alternatives. The first category, recreational alternatives, covers seven main alternatives that address various strategies of reducing dusky shark mortality in the recreational fishery. The second category of alternatives, commercial measures, considers eight main alternatives that address various strategies of reducing dusky shark mortality in the commercial fishery.

The potential impacts these alternatives may have on small entities have been analyzed and are discussed in the following sections. The preferred alternatives include: Alternative A2, Alternative A6a, Alternative B3, Alternative B5, Alternative B6, and Alternative B9. The economic impacts that would occur under these preferred alternatives were compared with the other alternatives to determine if economic impacts to small entities could be minimized while still accomplishing the stated objectives of this rule.

Alternative A1, the no action alternative, would not implement any management measures in the recreational shark fishery to decrease mortality of dusky sharks, likely resulting in direct, short- and long-term neutral economic impacts. Since there would be no changes to the fishing requirements, there would be no economic impacts on small entities. If more restrictive measures are required in the long-term under MSA or other statutes such as the Endangered Species Act, moderate adverse economic impacts may occur. NMFS does not prefer this alternative at this time, given that the purpose of this action is to address overfishing and rebuilding.

Under Alternative A2, a preferred alternative, HMS Angling and Charter/Headboat permit holders would be required to obtain a shark endorsement, which requires completion of an online shark identification and fishing regulation training course and quiz in order to fish for, retain, possess, or land sharks. Obtaining the shark endorsement would be included in the online HMS permit application and renewal processes and would require the applicant to complete a training course focusing on shark species identification, fishing regulations, and safe handling. This alternative would likely result in no economic impacts since there would be no additional cost to the applicant and only a small additional investment in time. Obtaining the shark endorsement would be a part of the normal HMS permit application or renewal. The applicant would simply need to indicate the desire to obtain the shark endorsement, after which he or she would be directed to an online training course and quiz. The goal of the training course is to help prevent anglers from landing prohibited or undersized sharks, and thus, help rebuild stocks. Furthermore, the list of shark endorsement holders would allow for more targeted surveys and outreach, likely increasing the reliability of recreational shark catch estimates. This preferred alternative helps achieve the objectives of this proposed rule while minimizing any significant economic impacts on small entities.

Alternative A3 would require participants in the recreational shark fishery (Angling and Charter/Headboat permit holders) to carry an approved shark identification placard on board the vessel when fishing for sharks. This alternative would likely result in short- and long-term minor economic impacts. The cost of obtaining a placard, which would be provided by NMFS, whether by obtaining a pre-printed one or self-printing, would be modest. To comply with the requirement of this alternative, the angler would need to keep the placard on board the vessel when fishing for sharks and, since carrying other documents such as permits and boat registration is already required, this is unlikely to be a large inconvenience. This alternative would have slightly more economic impacts than Alternative A2 on small entities and would likely be less effective than the training course in Alternative A2.

Under Alternative A4, NMFS would extend the existing prohibition on the retention of certain ridgeback sharks (bignose, Caribbean reef, dusky, Galapagos, night, sandbar, and silky sharks) to include the rest of the ridgeback sharks, namely oceanic whitetip, tiger sharks, and smoothhound sharks, which currently may be retained by recreational shark fishermen (HMS Angling and Charter/Headboat permit holders) under certain circumstances. This alternative would simplify compliance with the ridgeback prohibition, which includes dusky sharks, for the majority of fishermen targeting sharks. Dusky shark mortality in the recreational fishery is in part due to misidentification of dusky sharks (which are prohibited) as one the retainable species. This alternative, however, could also potentially have adverse economic impacts for a small subset of fishermen that target oceanic whitetip, tiger, and smoothhound sharks. These adverse impacts would be quite small, however, for oceanic whitetip and tiger sharks because few fishermen recreationally fish for these species. Based on MRIP data, however, this alternative could have considerable impacts on fishermen targeting sharks in the smoothhound shark complex because smoothhound sharks are commonly caught by recreational fishermen. Recreational fishermen with only state-issued permits would still be able to retain smoothhound sharks (those that hold an HMS permit must abide by Federal regulations, even in state waters). Alternative A4 would likely result in both direct short- and long-term, minor adverse economic impacts on HMS Charter/Headboat operators if prohibiting landing of additional shark species reduces demand for fishing charters. While this alternative may help reduce dusky mortality, the other proposed measures will address overfishing and rebuilding without the greater economic impacts associated with Alternative A4.

Under Alternative A5, the minimum recreational size limit for authorized shark species, except for Atlantic sharpnose, bonnethead, and hammerhead (great, scalloped, and smooth) sharks, would increase from 54 to 89 inches fork length, which is the approximate length at maturity for dusky sharks. Under this alternative, increasing the recreational size limit would likely result in both direct short- and long-term, moderate adverse economic impacts for recreational fishermen, charter/headboat operators, and tournament operators. Because many shark species have a maximum size below an 89 inch size limit, there could be reduced incentive to fish recreationally for sharks due to the decreased potential to legally land these fish. Increasing the minimum size for retention would also impact the way that tournaments and charter vessels operate. While the impacts of an 89 inch fork length minimum size on tournaments awarding points for pelagic sharks may be lessened because these tournament participants target larger sharks, such as shortfin mako, blue, and thresher, that grow to larger than 89 inches fork length, this may not be the case for tournaments targeting smaller sharks. Tournaments that target smaller sharks, especially those that target shark species that do not reach sizes exceeding 89 inches fork length such as blacktip sharks, may be heavily impacted by this alternative. Reduced participation in such tournaments could potentially decrease the amount of monetary prizes offered to winners. Thus, implementation of this management measure could significantly alter the way some tournaments and charter vessels operate, or reduce both opportunities to fish for sharks and thus drastically reduce general interest and demand for recreational shark fishing, which could create adverse economic impacts. While this alternative may result in minor beneficial ecological impacts for dusky sharks, for the aforementioned reasons, NMFS does not prefer this alternative at this time.

Sub-alternative A6a is a preferred alternative and would require all persons on board vessels with Atlantic HMS permits participating in fishing tournaments that bestow points, prizes, or awards for sharks to use circle hooks when fishing for or retaining sharks, and require the use of circle hooks by all HMS recreational permit holders when fishing for or retaining sharks outside of a tournament. Any sharks caught on non-circle hooks would have to be released. It would be presumed that an operator is recreationally fishing for sharks if it is fishing with natural bait and using wire or heavy (200 pound test or greater) monofilament or fluorocarbon leader. Relative to the total cost of gear and tackle for a typical fishing trip, the cost associated with switching from J-hooks to circle hooks is negligible. Thus, the immediate cost in switching hook type is likely minimal. However, there is conflicting indication that the use of circle hooks may reduce or increase catch per unit effort (CPUE) resulting in lower catch of target species. In the event that CPUE is reduced, some recreational fishermen may choose not to fish for sharks or to enter tournaments that offer awards for sharks. These missed fishing opportunities could result in minor adverse economic impacts in the short- and long-term. However, since the economic impacts are minor and circle hooks would likely reduce fishing mortality for dusky sharks, NMFS prefers this alternative at this time.

Sub-Alternative Ab6 is similar to A6a, but instead of requiring circle hooks when fishing for sharks defined by deploying natural bait while using a wire or heavy (200 pound test or greater) monofilament or fluorocarbon leader, it instead requires circle hooks when fishing for sharks defined by deploying a 5/0 or greater size hook to fish with natural bait outside of a fishing tournament. This use of the hook size standard to determine if the trip could be targeting sharks may result in more recreational trips requiring circle hooks than under alterative A6a, but many of those trips might actually not be targeting sharks, but instead other large pelagic fish. The use of a heavy leader is probably more correlated with angling activity that is targeting sharks.

Sub-Alternative A6c is similar to A6a and A6b, but restricted to requiring the use of circle hooks by all HMS permit holders participating in fishing tournaments that bestow points, prizes, or awards for sharks. This alternative impacts a smaller universe of recreational fishermen, so the adverse impacts are smaller. However, given the limited scope of this requirement, the benefits to reducing dusky shark mortality via the use of circle hooks are also more limited.

Alternative A7 would prohibit any HMS permit holders from retaining any shark species in the recreational fishery. Recreational fishermen may still fish for and target authorized shark species for catch and release. The large number of fishermen who already practice catch and release and the catch and release shark fishing tournaments currently operating would not be impacted. As this alternative would help eliminate accidental landings of already-prohibited dusky sharks, it would have minor beneficial ecological impacts. However, prohibiting retention of sharks could have major impacts on fishing behaviors and activity of other recreational shark fishermen and reduce their demand for charter/headboat trips. Only allowing catch and release of authorized sharks in the recreational fishery could impact some fishermen that retain sharks recreationally and tournaments that award points for landing sharks. Thus, prohibiting retention of Atlantic sharks in the recreational shark fisheries could drastically alter the nature of recreational shark fishing and reduce incentives to fish for sharks. Additionally, the reduced incentive to fish for sharks could negatively impact profits for the HMS Charter/Headboat industry. Because there could be major impacts to the recreational shark fisheries from this management measure, Alternative A7 would likely have direct short- and long-term, moderate adverse economic impacts on small business entities.

Under Alternative B1, the no action alternative, NMFS would not implement any measures to reduce dusky shark mortality in the commercial shark or HMS fisheries. Since no management measures would be implemented under this alternative, NMFS would expect fishing practices to remain the same and economic impacts to be neutral in the short-term. Dusky sharks are a prohibited species and fishermen are not allowed to harvest this species. Thus, there would not be any economic impacts on the fishery in the short-term. If more restrictive measures are required in the long-term under MSA or other statutes such as the Endangered Species Act, moderate adverse economic impacts may occur. NMFS does not prefer this alternative at this time, given that the purpose of this action is to address overfishing and rebuilding.

Under Alternative B2, HMS commercial fishermen would be limited to 750 hooks per pelagic longline set with no more than 800 assembled gangions onboard the vessel at any time. Based on average number of hooks per pelagic longline set data, the hook restriction in this alternative could have neutral economic impacts on fishermen targeting bigeye tuna, mixed tuna species, and mixed HMS species, because the average number of hooks used on pelagic longline sets targeting these species is slightly above or below the limit considered in this alternative. This alternative would likely have adverse economic impacts on pelagic longline fishermen who target dolphin fish, because these fishermen on average use 1,066 hooks per set. If NMFS implemented this alternative, fishermen targeting dolphin fish with pelagic longline gear would have to reduce their number of hooks by approximately 30 percent per set, which may result in a similar percent reduction in set revenue or could result in increased operating costs if fishermen decide to offset the limited number of hooks with more fishing sets. While this alternative would have minor beneficial ecological impacts, overall, Alternative B2 would be expected to have short- and long-term minor adverse economic impacts on the pelagic longline fishery.

Under Alternative B3, a preferred alternative, HMS commercial fishermen must release all sharks that are not being boarded or retained by using a dehooker, or by cutting the gangion no more than three feet from the hook. This alternative would have neutral to adverse economic impacts on commercial shark fishermen using pelagic longline gear. Currently, fishermen are required to use a dehooking device if a protected species is caught. This alternative would require this procedure to be used on all sharks that would not be retained, or fishermen would have to cut the gangion to release the shark. Currently, it is common practice in the pelagic longline fishery to release sharks that are not going to be retained (especially larger sharks) by cutting the gangion, but they usually do not cut the gangion so only 3 feet remain, so there might be a slight learning curve. Using a dehooker to release sharks in the pelagic longline fishery is a less common practice; therefore, there may be more of a learning curve that would make using this technique more time consuming and would make fishing operations temporarily less efficient while fishermen become used to this technique. NMFS expects that these inefficiencies would be minimal and that fishermen would become adept in using a dehooker to release sharks over time given they are all practiced at using a dehooker to release protected species. Thus, Alternative B3 would be expected to have short- and long-term neutral economic impacts on the pelagic longline fishery.

Under Alternative B4, NMFS considered various dusky shark hotspot closures for vessels fishing with pelagic longline gear. The hotspot closures considered are the same areas that were analyzed in Draft Amendment 5 and the A5b Predraft. These hotspot closure alternatives are located where increased levels of pelagic longline interactions with dusky sharks had been identified based on HMS Logbook data. During the months that hotspot closures are effective, Atlantic shark commercial permit holders (directed or incidental) would not be able to fish with pelagic longline gear in these areas. While these closures would result in minor ecological benefits, NMFS does not prefer them at this time because the preferred alternatives would address overfishing and rebuilding without the adverse social and economic impacts associated with these closures.

This alternative would define a rectangular area in a portion of the existing Charleston Bump time/area closure area, and prohibit the use of pelagic longline gear by all vessels during the month of May in that area. This alternative is expected to have moderate short and long-term direct adverse economic impacts on 46 vessels that have historically fished in this Charleston Bump area during the month of May. This closure would result in the loss of approximately $15,250 in gross revenues per year per vessel assuming no redistribution of effort outside of the closed area.

However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. Based on natural breaks in the percentage of sets vessels made inside and outside of this alternative's hotspot closure area, NMFS estimated that if a vessel historically made less than 40 percent of its sets in the hotspot closure area, it would likely redistribute all of its effort. If a vessel made more than 40 percent but less than 75 percent of its sets in the hotspot closure area, it would likely redistribute 50 percent of its effort impacted by the hotspot closure area to other areas. Finally, if a vessel made more than 75 percent of its sets solely within the hotspot closure area, NMFS assumed the vessel would not likely shift its effort to other areas. Based on these individually calculated redistribution rates, the percentage of fishing in other areas during the gear restriction time period, the percentage of fishing in other areas during the hotspot closure time period, and the catch per unit effort for each vessel in each statistical area, NMFS estimated the potential landings associated with redistributed effort associated with fishing sets displaced by the hotspot closure area. The net loss in fishing revenues as a result of the Charleston Bump Hotspot May closure after considering likely redistribution of effort is estimated to be $8,300 per vessel per year. Alternative B4a would result in moderate short- and long-term adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Charleston Bump Hotspot May area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear in the vicinity of the “Hatteras Shelf” area of the Cape Hatteras Special Research Area during the month of May where elevated levels of dusky shark interactions have been reported. This alternative is expected to have moderate short and long-term direct adverse economic impacts on 42 vessels that have historically fished in this Hatteras Shelf Hotspot area during the month of May. The average annual revenue per vessel from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $9,980 during the month of May, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Hatteras Shelf Hotspot May closure on fishing revenues after considering likely redistribution of effort is estimated to be $5,990 per vessel per year. Alternative B4b would result in moderate adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Hatteras Shelf Hotspot May area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear in the vicinity of the “Hatteras Shelf” area of the Cape Hatteras Special Research Area during the month of June where elevated levels of dusky shark interactions have been reported. This alternative is expected to have moderate short and long-term direct adverse economic impacts on 37 vessels that have historically fished in this Hatteras Shelf Hotspot area during the month of June. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $7,640 per vessel during the month of June, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Hatteras Shelf Hotspot June closure on fishing revenues after considering likely redistribution of effort is estimated to be $4,010 per vessel per year. Alternative B4c would result in moderate adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Hatteras Shelf Hotspot June area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear in the vicinity of the “Hatteras Shelf” area of the Cape Hatteras Special Research Area during the month of November where elevated levels of dusky shark interactions have been reported. This alternative is expected to have minor short and long-term direct adverse economic impacts on 23 vessels that have historically fished in this Hatteras Shelf Hotspot area during the month of November. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $5,230 per vessel during the month of November, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Hatteras Shelf Hotspot November closure on fishing revenues after considering likely redistribution of effort is estimated to be $3,540 per vessel per year. Alternative B4d would result in minor adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Hatteras Shelf Hotspot November area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear by all U.S. flagged-vessels permitted to fish for HMS in the three distinct closures in the vicinity of the Mid-Atlantic Canyons during the month of October where elevated levels of dusky shark interactions have been reported. This alternative is expected to have moderate short and long-term direct adverse economic impacts on 64 vessels that have historically fished in this Canyons Hotspot October area. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $9,950 per vessel during the month of October, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Canyons Hotspot October closure on fishing revenues after considering likely redistribution of effort is estimated to be $3,720 per vessel per year. Alternative B4e would result in moderate adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Canyons Hotspot October area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear by all U.S. flagged-vessels permitted to fish for HMS in July in an area adjacent to the existing Northeastern U.S. closure which is currently effective for the month of June, where elevated levels of dusky shark interactions have been reported. This alternative is expected to have moderate short- and long-term direct adverse economic impacts on 35 vessels that have historically fished in this Southern Georges Banks Hotspot area during the month of July. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $14,230 per vessel during the month of July, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Southern Georges Banks Hotspot July closure on fishing revenues after considering likely redistribution of effort is estimated to be $8,290 per vessel per year. Alternative B4f would result in moderate adverse economic impacts as a result of restricting longline vessels from fishing in the Southern Georges Banks Hotspot July area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear by all U.S. flagged-vessels permitted to fish for HMS in August in an area adjacent to the existing Northeastern U.S. closure, which is currently effective for the month of June, where elevated levels of dusky shark interactions have been reported. This alternative is expected to have moderate short and long-term direct adverse economic impacts on 35 vessels that have historically fished in this Southern Georges Banks Hotspot area during the month of August. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $12,260 per vessel during the month of August, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Southern Georges Banks Hotspot August closure on fishing revenues after considering likely redistribution of effort is estimated to be $5,990 per vessel per year. Alternative B4g would result in moderate adverse economic impacts as a result of restricting pelagic longline vessels from fishing in the Southern Georges Banks Hotspot August area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would prohibit the use of pelagic longline gear by all U.S. flagged-vessels permitted to fish for HMS in a portion of the existing Charleston Bump time/area closure during the month of November where elevated levels of dusky shark interactions have been reported. This alternative is expected to have minor short and long-term direct adverse economic impacts on 32 vessels that have historically fished in this Charleston Bump Hotspot area during the month of November. The average annual revenue from 2008 through 2014 from all fishing sets made in this hotspot closure area has been approximately $7,030 per vessel during the month of November, assuming that fishing effort does not move to other areas. However, it is likely that some of the vessels that would be impacted by this hotspot closure would redistribute their effort to other fishing areas. The net impact of the Charleston Bump Hotspot November closure on fishing revenues after considering likely redistribution of effort is estimated to be $2,720 per vessel per year. Alternative B4h would result in minor adverse social and economic impacts as a result of restricting pelagic longline vessels from fishing in the Charleston Bump Hotspot November area, thus causing decreased revenues and increased costs associated with fishing in potentially more distant waters if vessel operators redistribute their effort.

This alternative would allow PLL vessels that have demonstrated an ability to avoid dusky sharks and comply with dusky shark regulations to fish within any dusky hotspot closure adopted. This approach would address the fact that, according to HMS logbook data, relatively few vessels have consistently accounted for the majority of the dusky shark interactions and also address requests from PLL participants to increase individual accountability within the fishery. Depending on the metrics selected and fishery participant behavior, this alternative could have adverse socioeconomic effects on certain vessels that are both poor avoiders of dusky sharks and are non-compliant with the regulations. This alternative would require an annual determination of which vessels would qualify for conditional access based on dusky shark interactions. NMFS would analyzed the socioeconomic impact by using similar fishing effort redistribution proposed in Draft Amendment 7 and described in Alternative B5. This alternative would have neutral to beneficial effects for vessels that are still authorized to fish in a hotspot closure(s), and would reduce adverse socioeconomic effects of a closure(s). As explained above, NMFS is not preferring any hotspot closure alternative and thus is not preferring this alternative, which would work in conjunction with a closure.

This alternative would implement bycatch caps on dusky shark interactions over a three-year period in hotspot areas. Under this alternative, NMFS would allow pelagic longline vessels limited access to high dusky shark interaction areas with an observer onboard while limiting the number of dusky shark interactions that could occur in these areas. Once the dusky shark bycatch cap for an area is reached, that area would close until the end of the three-year bycatch cap period. This alternative could lead to adverse economic impacts by reducing annual revenue from fishing in the various hot spot areas depending on the number of hotspots where bycatch cap limits are reached, the timing of those potential closures during the year, and the amount of effort redistribution that occurs after the closures. In addition to direct impacts to vessels owners, operators, and crew members, this alternative would have moderate, adverse indirect impacts in the short and long-term on fish dealers, processors, bait/gear suppliers, and other shore-based businesses impacted by reduced fishing opportunities for pelagic longline vessel owners that would have fished in the hotspot area. As explained above, NMFS is not preferring any hotspot closure alternative and thus is not preferring this alternative, which would work in conjunction with a closure.

Alternative B5, a preferred alternative, would provide additional training to pelagic longline, bottom longline, and shark gillnet vessel owners and operators as a new part of all currently required Safe Handling and Release Workshops. The training course would provide information regarding shark identification and regulations, as well as best practices to avoid interacting with dusky sharks and how to minimize mortality of dusky sharks caught as bycatch. This training course requirement provides targeted outreach to those who continue to interact with dusky sharks, which should decrease interactions with dusky sharks. This alternative would have minor adverse economic impacts since the fishermen would be required to attend a workshop, incur some travel costs, and would not be fishing while taking attending the workshop. Given the minor economic impacts and this alternative's potential to decrease dusky interactions and mortality, NMFS prefers this alternative.

The economic impacts associated with Alternative B6, a preferred alternative, which would increase dusky shark outreach and awareness through development of additional commercial fishery outreach materials and establish a communication and fishing set relocation protocol for HMS commercial fishermen following interactions with dusky sharks and increase outreach, are anticipated to be neutral. These requirements would not cause a substantial change to current fishing operations, but have the potential to help fishermen become more adept in avoiding dusky sharks. If fishermen become better at avoiding dusky sharks, there is the possibility that target catch could increase. On the other hand, the requirement to move the subsequent fishing set one nautical mile from where a previous dusky shark interaction occurred could move fishermen away from areas where they would prefer to fish and it could increase fuel usage and fuel costs. Given the low economic impacts of this alternative and its potential to decrease dusky shark interactions, NMFS prefers this alternative.

NMFS would seek, through collaboration with the affected states and the ASMFC, to extend the end date of the existing state shark closure from July 15 to July 31. Currently, the states of Virginia, Maryland, Delaware, and New Jersey have a state-water commercial shark closure from May 15 to July 15. Extending the closure period in state waters would result in minor beneficial ecological impacts. In 2014, 621 lb dw of aggregated LCS and 669 lb dw of hammerhead sharks were landed by commercial fishermen in Virginia, Maryland, and New Jersey from July 15 to July 31. Based on 2014 ex-vessel prices, the annual gross revenues loss for aggregated LCS and hammerhead shark meat to the regional fleet in revenues due to an extended closure date would be $847, while the shark fins would be $207. Thus the total loss annual gross revenue for aggregated LCS and hammerhead sharks would be $1,054. Extending this closure by 16 days could cause a reduction of commercial fishing opportunity, likely resulting in minor adverse economic impacts due to reduced opportunities to harvest aggregated LCS and hammerhead sharks. In the long-term, this reduction would be neutral since fishermen would be able to adapt to the new opening date.

Under Alternative B8, NMFS would remove pelagic longline gear as an authorized gear for Atlantic HMS. All commercial fishing with pelagic longline gear for HMS in the Atlantic, Gulf of Mexico, and Caribbean would be prohibited, which would have beneficial ecological impacts. However, this would greatly reduce fishing opportunities for pelagic longline fishing vessel owners. Prohibiting the use of pelagic longline fishing gear would result in direct and indirect, major adverse economic impacts in the short and long-term for pelagic longline vessel owners, operators, and crew.

Between 2008 and 2014, 168 different vessels reported using pelagic longline fishing gear in Atlantic HMS Logbooks. Average annual revenues were estimated to be approximately $34,322,983 per year based on HMS logbook records, bluefin tuna dealer reports, and the eDealer database. In 2014, there were 110 active pelagic longline vessels which produced approximately $33,293,118 in revenues. The 2014 landings value is in line with the 2008 to 2014 average. Therefore, NMFS expects future revenues forgone revenue on a per vessel basis to be approximately $309,000 per year based on 110 vessels generating an estimated $34 million in revenues per year. This displacement of fishery revenues would likely cause business closures for a majority of these pelagic longline vessel owners. Given the magnitude of the economic impact of this alternative, it is not a preferred alternative.

Under Alternative B9, a preferred alternative, NMFS would require the use of circle hooks by all HMS directed shark permit holders in the bottom longline fishery. This requirement would likely reduce the mortality associated with dusky shark bycatch in the bottom longline fishery. There is negligible cost associated with switch from J-hooks to circle hooks. However, it is possible that circle hooks may reduce catch per unit effort (CPUE) resulting in lower catch of target species. To the extent that CPUE is reduced, some commercial fishermen using BLL gear may experience reduced landings and associated revenue with the use of circle hooks. This alternative would require the 224 vessels that hold a shark directed limited access permit as of 2015 to use circle hooks. However, 104 of the 224 vessels have an Atlantic tunas longline permit, which requires fishermen to use circle hooks with pelagic longline gear. Thus, those vessels would already possess and use circle hooks. The remaining 120 permit holders would be required to use circle hooks when using bottom longline gear. Given the low switching costs from J-hooks to circle hooks and the potential to reduce dusky shark mortality, NMFS prefers this alternative.

Under this alternative, NMFS would annually allocate individual dusky shark bycatch quota (IDQ) to each individual shark directed or incidental limited access permit holder in the HMS pelagic and bottom longline fisheries for assignment to permitted vessels. These allocations would be transferable between permit holders. When each vessel's IDQ is reached, the vessel would no longer be authorized to fish for HMS for the remainder of the year. The concept of this alternative is similar to the Individual Bluefin Tuna Quota (IBQ) Program implemented in Amendment 7 to the 2006 Consolidated HMS FMP (79 FR 71510; December 2, 2014), which established individual quotas for bluefin tuna bycatch in the pelagic longline fishery and authorized retention and sale of such bycatch. Under this alternative, however, NMFS would continue to prohibit retention and sale of dusky sharks. The goal of individual quotas generally is to provide strong individual incentives to reduce interactions while providing flexibility for vessels to continue to operate in the fishery; however, several unique issues associated with dusky sharks would make these goals difficult to achieve.

In order to achieve the mortality reductions based upon the 2016 SEDAR 21 dusky shark assessment update, the number of dusky shark interactions may need to be substantially reduced. NMFS expects the allocations to each vessel may be extremely low and highly inaccurate/uncertain. As stated above, there is significant uncertainty in estimating dusky shark catches and calculating the appropriate level of catch for this alternative to be feasible. It is not clear that an IDQ system without an appropriate scientific basis would actually reduce interactions with dusky sharks. To the extent that any reduction actually occurred, some vessels would be constrained by the amount of individual quota they are allocated and this could reduce their annual revenue. If a pelagic longline vessel interacts with dusky sharks early in the year and uses their full IDQ allocation, they may be unable to continue fishing with pelagic longline or bottom longline gear for the rest of the year if they are unable to lease quota from other IDQ holders. This would result in reduced revenues and potential cash flow issues for these small businesses.

If vessel owners are only allocated a very low amount of IDQs, it is very unlikely that an active trading market for IDQs will emerge. The initial allocations could be insufficient for many vessels to maintain their current levels of fishing activity and they may not be able to find IDQs to lease or have insufficient capital to lease a sufficient amount of IDQs. Some vessel owners may view the risk of exceeding their IDQ allocations and the associated costs of acquiring additional quota to outweigh the potential profit from fishing, so they may opt to not continue participating in the fishery. The annual transaction costs associated with matching lessor and lessees, the costs associated with drafting agreements, and the uncertainty vessel owners would face regarding quota availability would reduce some of the economic benefits associated with leasing quota and fishing. There would also be increased costs associated with bottom longline vessels obtaining and installing EM and VMS units. Some bottom longline vessel owners might have to consider obtaining new vessels if their current vessels cannot be equipped with EM and VMS. There would be increased costs associated with VMS reporting of dusky interactions. Some fishermen would also need to ship EM hard drives after each trip and they may need to consider acquiring extra hard drives to avoid not having one available when they want to go on a subsequent trip.

NMFS is not preferring this alternative, as it does not further the objectives of this action. Given the challenges in properly identifying dusky sharks, every shark would need to be brought on board the vessel and ensure an accurate picture of identifying features was taken by the EM cameras. Such handling would likely increase dusky shark and other shark species mortality, and this action is supposed to reduce mortality. In addition, this alternative is also unlikely to minimize the economic impact of this rule as compared to the preferred alternatives given the potential for reduced fishing revenues, monitoring equipment costs, and transaction costs.

For reasons set out in the preamble, 50 CFR part 635 is proposed to be amended as follows:

The additions and revisions read as follows: