[Federal Register Volume 60, Number 120 (Thursday, June 22, 1995)]
[Rules and Regulations]
[Pages 32447-32466]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-14978]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
21 CFR Parts 1307, 1309, 1310, 1313 and 1316
[DEA No. 112F]
RIN 1117-AA23
Implementation of the Domestic Chemical Diversion Control Act of
1993 (PL 103-200)
AGENCY: Drug Enforcement Administration (DEA), Justice.
ACTION: Final rule.
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SUMMARY: This final rule establishes regulations to implement the
Domestic Chemical Diversion Control Act of 1993 (DCDCA or Act). These
regulations provide additional safeguards to prevent and detect the
diversion of listed chemicals by illicit drug manufacturers.
EFFECTIVE DATE: August 21, 1995. Persons seeking registration must
apply on or before October 5, 1995 in order to continue their business
pending final action by DEA on their application.
FOR FURTHER INFORMATION CONTACT: G. Thomas Gitchel, Chief, Liaison and
Policy Section, Office of Diversion Control, Drug Enforcement
Administration, Washington, D.C. 20537, Telephone (202) 307-7297.
SUPPLEMENTARY INFORMATION: On October 13, 1994, DEA published a notice
of proposed rulemaking (NPRM) entitled Implementation of the Domestic
Chemical Diversion Control Act of 1993 (Pub. L. 103-200) in the Federal
Register (59 FR 51887). The NPRM proposed to amend Title 21, Code of
Federal Regulations (21 CFR) by adding a new Part 1309, relating to the
registration of List I chemical manufacturers, distributors, retail
distributors, importers and exporters; revising Parts 1310 and 1313 to
amend the recordkeeping and reporting requirements for domestic as well
as import/export activities; adding new procedures with respect to the
exemption of regulated chemicals, including chemical mixtures and
certain drug products that are marketed under the Food, Drug and
Cosmetic Act; adding new procedures regarding ``brokers'', ``traders''
and ``international transactions''; and revising Part 1316 with respect
of DEA's administrative inspection authority.
There are two additional notices that DEA has published in the
Federal Register that relate to these regulations. On March 24, 1994 an
Interim Rule notice entitled Provisional Exemption From Registration
for Certain List I Chemical Handlers was published in the Federal
Register (59 FR 13881). This rule grants a temporary exemption from the
registration requirements of the DCDCA. The exemption will remain in
effect for any person who files with DEA a properly completed
application for registration on or before October 5, 1995, until such a
time as DEA takes final action on their application.
DEA published the second notice in the Federal Register on December
9, 1994, (59 FR 63738) withdrawing, for further study, Sections
1310.05(d) and 1310.06(h), which relate to manufacturer reports, and
Sections 1310.12 and 1310.13, which relate to the exemption of chemical
mixtures. The regulations regarding manufacturer reports and the
exemption of chemical mixtures will be re-proposed at a later date
following additional consultations with the affected chemical industry.
Formal comments that were received in response to the NPRM regarding
the withdrawn sections will be given consideration in the redrafting of
a new proposal for these sections.
Regulatory Flexibility and Small Business Impact
As required under the Regulatory Flexibility Act (5 U.S.C. 601, et
seq.), DEA addressed in detail regulatory flexibility and small
business impact as part of the NPRM. The NPRM discussed the difficulty
in determining with certainty how many persons would continue to handle
regulated ephedrine drug products, and thus be subject to the
regulations. This is due to the rapidly changing market affected by
state laws restricting the availability of ephedrine, the availability
of alternative products that are not regulated, and the intent of the
DCDCA to eliminate sales to clandestine laboratories.
No comments were received on this topic or on DEA's estimate of the
number of persons that will seek registration to handle regulated
ephedrine drug products. Since publication of the NPRM, the number of
states taking restrictive actions has increased. DEA is now aware of
twelve states that have enacted laws controlling regulated ephedrine
drug products, eleven by making them either prescription only or a
controlled substance, and one by setting state licensure and reporting
requirements. An additional four states have recently introduced
legislation to control the products, three by making them a controlled
substance and one by setting age restrictions and requiring reports of
all transactions. In addition, DEA has documented that several
wholesalers of regulated ephedrine drug products, the primary source of
supply for retail distributors, have changed their product line to
combination products that are not subject to regulation. Finally,
recent reports that the Food and Drug Administration (FDA) is
considering moving ephedrine into the prescription drug category may
further influence persons handling ephedrine drug products. Under the
circumstances, the number of retail distributor applicants under the
DCDCA remains uncertain.
In the NPRM, DEA was able to provide relief from the chemical
registration requirement for persons handling regulated ephedrine drug
products who are already registered with DEA to engage in similar
activities with controlled substances. In addition, manufacturers of
List I chemicals for internal use, with no subsequent distribution or
exportation of the chemical, were also exempted from the registration
requirement. Both of these proposals have been retained in the final
rule. Consideration was also given to exempting retail distributors
from the registration, recordkeeping and reporting requirements.
However, such an action would negate the purpose of the DCDCA by
leaving a significant portion of the sales of regulated ephedrine drug
products unregulated.
Following submission and review of the comments concerning the
proposed regulations, two requirements were identified which DEA
determined could be removed from the final regulations to reduce the
impact of compliance without compromising the control goals of the
DCDCA. The proposals were the reporting requirement for sales of 375
dosage units or more of regulated ephedrine drug products (proposed
[[Page 32448]] Section 1310.05(a)(2)) and the restrictions regarding
employment of certain persons (proposed Section 1309.72). These
proposals have been removed from this final rule.
Further, DEA also determined that the proposed regulations
regarding manufacturer reporting (proposed Sections 1310.05(d) and
1310.06(h)) and the exemption of chemical mixtures (proposed Sections
1310.12 and 1310.13) could result in a greater than anticipated burden
and, possibly, a duplicative reporting requirement, for the industry.
The requirements were withdrawn by notice published in the Federal
Register on December 9, 1994, (59 FR 63738) for reassessment and
redrafting following consultation with the affected industry.
DEA has endeavored, within the requirements and goals of the DCDCA,
to limit the impact of these regulations on the affected industry. In
some instances, as discussed below in the responses to specific
comments (e.g., separate registration for separate locations) the
specific language of the DCDCA established the parameters of control.
However, in other areas, DEA has been able to take additional steps in
these final regulations to lessen the impact of the DCDCA's
requirements on the affected industry, while simultaneously carrying
out the chemical control mandate of the DCDCA.
Public Comments
A total of 22 comments were submitted regarding the proposed
rulemaking. While the general tone of the comments was supportive of
efforts to prevent the flow of listed chemicals to clandestine
laboratories, the commentors raised a number of concerns regarding
certain provisions of the proposed regulation, as follows:
Registration
1. Six comments objected to the requirement in Section 1309.23 that
a separate registration be obtained for each location at which List I
chemical activities are carried out. The comments suggested that DEA
allow companies to obtain a single registration, with attendant fee,
for multiple locations or activities.
The law is specific on this point. The DCDCA requires that a
separate registration be obtained at each location at which List I
chemicals are distributed, imported or exported (21 U.S.C. 822(e) and
958(h)). In accordance with the requirements of the Office of
Management and Budget (OMB) Circular A-25, the costs associated with
each preregistration investigation must be recovered through the fees.
2. Four comments noted the chemical industry's practice of storing
and distributing chemicals from independently operated warehouses.
These commentors questioned how the requirement for separate
registrations for separate locations would apply to these warehouses.
In reviewing these comments, there appeared to be some confusion
regarding whether the commentors were addressing warehouse activities
that involved List I chemicals or List II chemicals. In subsequent
contacts with commentors for clarification, DEA was able to
specifically identify only two comments involving warehouses that
handle List I chemicals. DEA wishes to clarify that the registration
requirement applies only to the distribution, importation or
exportation of List I chemicals. Activities involving List II chemicals
are not subject to the registration requirement.
With respect to the use of independently owned warehouses, the
Controlled Substances Act (CSA), as amended, exempts warehousemen from
the registration requirement (21 U.S.C. 802(39), 822(c)(2), and
957(b)(1)(B)) for activities carried out in the normal course of their
business. Instead, the person who distributes List I chemicals from
independently owned warehouses must register at each location and
ensure that the other chemical control requirements, including
security, record keeping, reporting, etc., for their products are met
while under the supervision of the non-registered warehouseman.
3. One comment questioned what procedures would apply if more than
one chemical company stored and distributed chemicals from a single
warehouse, and whether separate registrations, if required, would
result in duplicative fees.
Each person who distributes, imports or exports a List I chemical
must register with DEA for each separate location at which such
activities are carried out. If more than one person independently
carries out such activities at the same location, then each person must
obtain a registration for their activities at that location. Each
application would be subject to a separate pre-registration
investigation that would require, among other things, a visit to the
applicant's business offices (which in this circumstance would be
separate from the warehouse). Therefore, the fees would not be
duplicative. The fees for registration are based on the costs
associated with the registration, as set forth in the NPRM. DEA's
experience in working with the chemical industry indicates this is a
rare business practice with respect to List I chemicals.
4. Two comments questioned the impact that registration would have
on research and development (R&D) activities that were described by the
commentors as involving ``very small quantities'' of chemicals in
mixtures that may be sent to laboratories for physical property or
performance testing.
The DCDCA does not require registration for research or development
activities, only distributing, importing or exporting. Thus
laboratories performing such testing would not be subject to the
registration requirement for research and development activities.
Further, the products referenced by the commentors are chemical
mixtures, therefore, they will be subject to the chemical mixture
exemption regulations that are being developed. It is DEA's intent, to
the extent possible, that the distribution of such mixtures to
laboratories for testing be exempted from the registration requirement.
5. Two comments expressed concern that manufacturers would be
forced to suspend their activities due to delays in the approval of
their registrations.
Early in the regulatory development process, DEA recognized that
the demands of establishing a new registration program would require a
transitional procedure that did not disrupt ongoing legitimate business
activities. As a consequence, DEA published a notice in the Federal
Register on March 24, 1994 (59 FR 13881), that provides a temporary
exemption from the registration requirement. Any person who submits a
proper application for registration on or before October 5, 1995 will
remain exempt from the registration requirement until DEA takes final
action regarding their application. There is no cause for current
legitimate manufacturers to be concerned that they will have to suspend
their activities pending issuance of their registrations.
6. Two comments questioned how the registration requirement would
apply to manufacturers of non-regulated chemicals that contain List I
chemicals as either unintentional by-products or impurities.
This concern has been raised with respect to the application of
chemical diversion control requirements on a number of occasions in the
past. The manufacture of a List I chemical as an unintentional by-
product during the manufacture of another chemical does not require
registration, so long as the List I chemical is not distributed or
exported. As to the presence of List I [[Page 32449]] chemicals as
impurities in non-regulated products, it is DEA's understanding that
the impurities are present only in trace amounts. It is not DEA's
intent that the distribution of non-regulated chemicals that contain
trace amounts of List I chemicals as unintentional by-products of the
manufacturing process be subject to the registration requirement.
7. One comment suggested that if the Food and Drug Administration
(FDA) removes ephedrine from over-the-counter status, the primary
reason for, and economic foundation of, the registration program would
be removed through the elimination of the need to register and collect
fees from the estimated 10,000 retail distributors that handle
ephedrine drug products that are regulated as List I chemicals. The
comment urged that if such a circumstance occurs, DEA should withdraw
the registration requirement.
The DCDCA requires registration of any person who distributes,
imports or exports any List I chemical and was not intended solely to
control the distribution of regulated ephedrine drug products. DEA's
chemical control program, including registration, applies to all List I
chemicals. The potential elimination of the need to register retail
distributors of ephedrine drug products would not change the purpose of
the program. Secondly, the FDA action is only speculative at this time,
and its subsequent impact, if passed, is even more uncertain. However,
OMB Circular A-25 requires the review of all fees every two years.
Under this review, any major change in the registration population
would require reassessment of the fees for other registrants. Any
change to the fees would be subject to notice and comment.
8. One comment characterized the registration of sites that
manufacture List I chemicals as unnecessary, since it duplicates
existing site reporting requirements under other Federal laws. A second
comment questioned the need for a pre-registrant investigation and fee
for high volume manufacturers.
The DCDCA requires persons who distribute, import or export a List
I chemical to obtain a registration and requires that DEA determine if
such registration would be in the public interest pursuant to the
criteria set forth in Section 823(h) of the Act. The pre-registrant
investigation must be conducted to determine whether the criteria
regarding the public interest are met. The required fee is assessed to
cover the costs of that investigation.
9. One comment requested clarification of the exemption from
chemical registration found in Section 1309.25, for companies that are
registered with DEA to handle controlled substances.
A controlled substance registrant that distributes, imports or
exports a List I chemical, other than a regulated drug product that may
be marketed or distributed under the Food, Drug, and Cosmetic Act
(FDCA), must obtain a chemical registration for such activities. The
exemption in Section 1309.25 applies only to controlled substance
registrants who engage in similar activities with a regulated drug
product that may be marketed or distributed under the FDCA. The
exemption is directed at the approximately 65,000 pharmacies and others
who are already registered with DEA under the CSA, so as to avoid a
duplicative registration requirement on these registrants. In response
to this comment and to help clarify the provisions of the exemption,
Section 1309.25 has been amended to specify that the exemption applies
only to activities involving drug products that may be marketed or
distributed under the Food, Drug and Cosmetic Act, that are regulated
as List I chemicals pursuant to Section 1310.01(f)(1)(iv).
10. One comment expressed concerns that the regulations will
require persons who handle exempt chemical mixtures containing List I
chemicals to register.
The proposed Section 1310.13, which was withdrawn for re-
publication at a later date, established that the chemical mixtures
exempted by the Administrator would not be subject to the registration,
recordkeeping, reporting, and import/export provisions of the Act. It
is DEA's intention that the same provision will be included in the new
chemical mixture exemption regulations. In the interim, chemical
mixtures will be exempt until the exemption regulations are
promulgated. However, creation of a chemical mixture for the purpose of
evading the requirements of the CSA is a violation of CSA (21 U.S.C.
843(a)(8), subject to a penalty of imprisonment for not more than four
years, a fine of $30,000, or both.
Brokers and Traders
11. Three comments found the definition of ``broker'' and
``trader'' in Sections 1310.01(k) and 1313.02(m) to be overly broad.
Specifically, subparagraph (3) of each section may be read as covering
any action, whether deliberate or inadvertent, that results in an
international transaction taking place, i.e., a chemical distributor
provides a foreign customer with a list of possible sources for a
chemical that the distributor does not carry, thus ``bringing together
a buyer and a seller.''
DEA agrees that the definition is not intended to cover such
circumstances. DEA has amended the wording of subparagraph (3) of the
definition to read ``Fulfilling a formal obligation to effect the
transaction by bringing together a buyer and seller, a buyer and
transporter, or a seller and transporter; or by receiving any form of
compensation for so doing.''
12. One comment requested clarification of whether import brokers
and freight forwarders would be considered brokers or traders.
Brokers and traders are defined as U.S. based persons who assist in
arranging international transactions in listed chemicals; the
definition does not apply to domestic transactions, including imports
into or exports from the United States. Further, brokers and traders,
as defined, do not take possession of listed chemicals. Under the
circumstances, U.S. based import brokers and freight forwarders would
not be considered brokers or traders, as defined, while acting in the
normal course of their business. However, it must be understood that
imports, exports and distributions of listed chemicals are subject to
other provisions of the CDTA and DCDCA and a regulated person is
responsible for those transactions.
Security Provisions
13. Two comments questioned the appropriateness of the proposed
Section 1309.72, which concerns employment of persons who have been
convicted of a felony relating to controlled substances or listed
chemicals or have been subject to a denial, suspension or revocation of
a DEA registration. One comment raised the issue of whether the
requirements violate occupational safety and health, privacy, and non-
discrimination laws. The other pointed out that in the absence of the
stringent security and storage requirements applied to controlled
substances, a far greater number of personnel would have access to List
I chemicals, such as ephedrine, thus increasing the burden required to
satisfy the requirements of this section.
DEA agrees that the lack of restrictions regarding possession of
List I chemicals makes it difficult to employ comprehensive screen
practices for all potential employees as proposed in Section 1309.72.
However, registrants must employ safeguards to prevent List I chemicals
from being diverted from their businesses into the illicit traffic. DEA
is, therefore, withdrawing the proposal prohibiting such employment,
and in its place establishing that registrants must exercise caution in
their employment practices regarding [[Page 32450]] persons who have
been convicted of a felony relating to controlled substances or listed
chemicals, or have been subject to denial, suspension or revocation of
a DEA registration. The registrant must understand that if an employee
diverts a listed chemical, the registrant may be subject to a
revocation action. The registrant must assess the risks involved in
employing such a person and, in the event of employment, institute
procedures to limit the potential for diversion of List I chemicals by
such an employee.
14. One comment requested that DEA provide comprehensive guidance
regarding assessment of security measures as outlined in Section
1309.71(b).
List I chemical handlers vary greatly in size, type of business and
volume handled. Under such circumstances, it would not be desirable to
establish specific, inflexible security controls and procedures. The
factors outlined in Section 1309.71(b) provide a general framework of
elements that allow potential registrants flexibility in assessing the
potential threat of diversion and to determine measures necessary to
prevent diversion. DEA has made and will continue to make available
additional suggestions regarding security in separate publications for
the chemical industry. In addition, as set forth in Section 1309.71(c),
an applicant or registrant may, following development of a proposed
system of controls and procedures, submit materials and plans regarding
the system to DEA for assessment.
15. One comment opposed the proposal that retailers stock ephedrine
drug products that are regulated as List I chemicals behind a counter
on the basis that this requirement creates a third class of drugs
(Section 1309.71(a)(2)).
DEA is regulating a List I chemical, not a drug. Section
1309.71(a)(2) provides a basic security measure for a List I chemical
that is known to have been diverted from both the retail and wholesale
levels for the purposes of manufacturing illicit controlled substances.
The section does not prohibit any person from purchasing the product or
establish any restrictive requirements, such as sale by prescription
only, that must be met by the purchaser. The requirement simply
provides an additional means of controlling diversion without
restricting public access to the product.
Section 1313.12 Requirement of 486 for Imports
16. One comment questioned the need for advance notice of
importation in cases of a return of a previously exported listed
chemical and suggested that manufacturers be exempted from this
requirement for the return of chemicals which they exported.
DEA previously recognized, under the 1988 Chemical Diversion and
Trafficking Act, that exports of listed chemicals might be rejected or
otherwise undeliverable, requiring that they be returned to the U.S.
exporter. Existing Section 1313.22(e) provides that exports of listed
chemicals that are refused, rejected, or otherwise deemed undeliverable
may be returned to the U.S. exporter of record without advance notice
or a 486 form. That section requires that a written notification be
submitted to DEA within a reasonable time following the return.
However, an export that has cleared foreign customs and been
accepted by the foreign consignee is not subject to this exception. Any
such shipments subsequently returned to the U.S. are imports, subject
to all applicable requirements.
17. Two comments questioned the provisions of Section 1313.12(e).
One objected that the summary reports of imports required by Section
1313.12(e) are duplicative, since DEA would already have the
information available from previously filed 486 forms. The second
questioned whether waiver of the advance notice requirement in Section
1313.21(f) would also mean waiver of the quarterly report in Section
1313.21(e), and suggested that DEA publish in Section 1313.21(f) a list
of countries with waivers when the final rule is published.
DEA agrees that the wording of this section needed clarification.
Section 1313.12(e) proposed minimized reporting procedures for export
transactions in circumstances where the Administrator has waived the
advance notice requirements as unnecessary for effective chemical
diversion control. The comments point out that the proposed section did
not specify that a 486 form need not be filed for such transactions.
The section has been amended to clarify that a 486 form does not have
to be submitted for exports under this section; the regulated person
need only file a quarterly summary of such exports. There are presently
no waivers established under Section 1313.21(f). This is a new
authority granted to the Administrator by the DCDCA. Countries to which
this new provision will apply will be determined after implementation
of these regulations.
18. One comment raised concerns regarding the need to file an
Import 486 form when foreign customers return containers that have not
been completely emptied.
DEA has long recognized the standard industry practice to allow a
certain level of `overage' in the amount of chemicals actually shipped
in very large tank car/cargo ship type exports due to the difficulty to
full recovery and, therefore, that containers that still contain some
of the chemicals may be returned. DEA has not required that a 486 form
be filed for the return of containers with such ``leavings'', when the
amount of chemical is within normal or standard residue levels.
Exports
19. One comment noted the provisions of the DCDCA allowing the
Administrator to withdraw the waiver of the advance notice requirement
for all exports of listed chemical to a specified country. The
commentor asked if, in the future, existing waivers might be withdrawn.
The comment also questioned whether other countries have agreed to
comply with the same rules.
The DCDCA allows DEA to require, by regulation, that all exports of
a listed chemical to a specified country be subject to the advance
notice requirement, regardless of regular customer status, if it is
determined that advance notification of export is necessary for
compliance with international agreements regarding chemical controls or
is necessary to support chemical control programs in other countries.
It is possible that the waiver of the advance notice requirement for
exports of a listed chemical to a specified country may be withdrawn.
However, DEA would be required to publish a notice in the Federal
Register regarding the withdrawal of the waiver and provide an
opportunity for public comment. With respect to the question of
compliance with these rules by other countries, all parties to the
United Nations Convention Against Illicit Traffic in Narcotic Drugs and
Psychotrophic Substances of 1988 are required to be able to provide
advance notice of exports of List I chemicals, if requested by the
importing country.
20. One comment requested clarification of the term ``reasonable
cause'' as used in Section 1313.21(g) and of the responsibilities of
exporters to know the laws of the countries to which chemicals are
exported. [[Page 32451]]
The term ``reasonable cause'' applies to transactions that, due to
circumstances such as an unusual method of payment or shipping or
quantities inconsistent with stated uses, raise concerns that a
customer or a transaction is not what it is represented to be.
Exporters should understand the nature of their legitimate transactions
and should make informed decisions as to whether the circumstances
surrounding a specific transaction give rise to questions regarding the
legitimacy of the transaction. As to the laws of other countries, the
exporter is expected to make a reasonable effort to determine the
validity of a transaction prior to exporting a listed chemical to a
country. DEA has published information regarding foreign import
restrictions in the Federal Register. If further restrictions become
known to DEA, they also will be published in the Federal Register.
21. One comment objected to the general export reporting
requirements as burdensome and unnecessary.
The general export reporting requirements were established by the
CDTA in 1988, and have been in continuous use for over five years
without presenting any significant obstacles to legitimate chemical
exports. As noted in the preamble to the NPRM, the export controls have
been successful in significantly reducing the availability of U.S.
chemicals to clandestine laboratories in foreign countries.
Definition of Therapeutically Insignificant
22. Two comments argued that the U.S. Food and Drug Administration
(FDA) is the appropriate authority for determining whether a product
contains therapeutically significant quantities of a medicinal
ingredient and that FDA's tentative final monograph for ephedrine
combination products should be used as the standard for making such
determinations.
At this time, the monograph is a proposed rule. FDA acknowledges
that it must publish a final rule in order to actually establish a
monograph. When FDA publishes the final monograph, DEA will consider
use of the monograph as the determinative standard for therapeutically
significant quantities of a medicinal ingredient under the DCDCA. Until
such a time, the compendiums set forth in Section 1310.01(f)(1)(iv)(A)
provide additional flexibility and will be the primary standard for
determining if therapeutically significant quantities of a medicinal
ingredient are present in a product.
23. Two comments objected to the provision that a person applying
for exemption of a product, the formulation of which is not listed in
the compendiums, must submit verification from FDA that the product may
be lawfully marketed under the Food, Drug and Cosmetic Act. The
commentor noted that FDA does not provide such verifications.
DEA agrees and has removed that language. In its place, the person
applying for the exemption must certify to DEA that the product may be
lawfully marketed under the Food, Drug and Cosmetic Act.
24. One comment questioned the lack of justification for the
choices of compendiums and suggested that the regulation be expanded to
include any recognized authority, such as textbooks, treatises,
compendia, statements of qualified experts, medical/scientific journals
or clinical studies conducted by outside researchers or by a drug
company.
The listed compendiums were chosen because they are readily
available and are widely recognized as reliable, scientifically
accurate and comprehensive listings of products that are commercially
available. With respect to the additional sources of information
suggested, if a product does not appear in the named compendiums, DEA
has provided manufacturers an additional avenue for product exemption.
A person requesting a determination from the Administrator that a
product does contain therapeutically significant amounts of a certain
medicinal ingredient may submit any such information that the person
believes supports their request.
25. One comment suggested that wholesalers do not have the
expertise to determine whether a drug meets the therapeutically
significant standard. Manufacturers should be responsible for making
the determination and providing notification to wholesalers that the
product meets the requirements.
DEA agrees that manufacturers are responsible for determining
whether a product meets the therapeutically significant standard and
for notifying their customers of whether the product is, therefore,
exempt from List I chemical controls. However, if a distributor has any
reason to question a product, then the distributor has an obligation to
attempt to determine whether the product meets the standard. If any
person, wholesaler or otherwise, is unable to determine from the listed
compendiums that a product meets the therapeutically significant
criteria, then that person may contact the DEA for assistance in making
such a determination.
Contents of Records and Reports
26. One comment acknowledged that most of the information required
by the regulations is already maintained in general business records
for all transactions. The exception is the registration number of the
purchaser. The comment objected that manufacturers should not be
required to inquire about the registration number of the customer so
long as the legitimacy of the customer is known.
DEA attempted to design the DCDCA recordkeeping requirements to be
consistent with existing business records to the extent possible, as
recognized by this commentor. One step in establishing the legitimacy
of a customer is determining the customer's activity with the regulated
chemical and, if that activity requires registration, that the customer
is registered to engage in the activity. A record of the customer's
registration number confirms that the supplier has taken one of the
appropriate steps to determine the legitimacy of the customer and the
transaction.
27. One comment noted that the disparity between the requirements
for maintenance of records for controlled substances (2 years) and List
I chemicals (4 years) would compel the maintenance of separate
recordkeeping systems for chemical and pharmaceutical records.
Although both laws are enforced by DEA, the chemical control
requirements of the CDTA and DCDCA are entirely separate from the
pharmaceutical requirements under the CSA. Each law establishes
different recordkeeping standards (21 U.S.C. 827 for controlled
substances and 21 U.S.C. 830 for listed chemicals), and with the
exception of one List I chemical (regulated ephedrine products) there
is little overlap between firms required to keep records under the two
laws.
28. One comment objected to the reporting requirement in Section
1310.05(a)(2) as inappropriate. The commentor suggested that
establishing a specific level for what constitutes an extraordinary
quantity and subjecting a registrant to civil and criminal penalties
for failing to file such reports should not be a role for DEA. DEA has
not set specific levels for what constitutes extraordinary quantities
for controlled substances, and should not do so for OTC drug products.
Further, the pharmacist counseling provision would create a third class
of drugs and would limit availability of the drugs to the public, since
there are many more retailers that sell the regulated
[[Page 32452]] ephedrine products than there are pharmacies.
This reporting requirement was proposed with the intent of
providing a clear standard with respect to reportable transactions
involving regulated ephedrine drug products. However, the comments
demonstrate that industry would prefer flexibility and discretion based
on the circumstances of the transaction rather than a specific
standard. Therefore, the proposed section 1310.05(a)(2) and related
language in Section 1310.05(b) have been removed.
However, removal of the specific standard for reporting does not
relieve regulated persons and registrants of the responsibility to
report transactions involving an extraordinary quantity of a listed
chemical. Registrants must review transactions involving the sale of
regulated ephedrine drug products to individuals for personal use
within the context of the established FDA guideline regarding the
manner in which the products should be used and the appropriate dosing
levels. In this regard, 375 dosage units of regulated ephedrine drug
products within a calendar month for individual use provides a valid
reference for registrants in determining whether additional efforts
should be made to confirm the validity of a transaction.
Miscellaneous
29. Two comments were received questioning the use of the DEA
Chemical Code Numbers set forth in Section 1310.02, rather than the
familiar Chemical Abstract Services (CAS) or Harmonized Tariff System,
(HTS) Numbers.
DEA has reviewed these numbering systems and determined that they
were designed for other purposes and that their use could lead to
confusion and jeopardize the accuracy of the information reported to
DEA. In the HTS numbering system there are multiple chemicals that are
assigned the same number and in the CAS numbering system that are
chemicals that are assigned multiple codes. DEA has produced and made
available a chemical reference guide that provides a cross reference to
the CAS and HTS numbers, which will be updated to include the new
Chemical Code Numbers.
With respect to the chemical codes, DEA discovered, following
publication of the NPRM, that the Chemical Code Numbers assigned to
Benzyl Chloride (8568) and Benzyl Cyanide (8570) were incorrect. The
correct Chemical Code Number for Benzyl Chloride is 8570 and for Benzly
Cyanide is 8735. These corrections have been made in this final order.
30. Three comments were submitted regarding the addition of new
chemicals to List I or List II. The first comment questioned the
addition of hydrochloric and sulfuric acid to List II without any
justification. The second questioned the addition of benzaldehyde and
nitroethane without specific justification of the addition or the
thresholds. The third recommended that DEA continue to publish the
proposed addition of any new chemicals for notice and comment and
suggested that DEA hold public hearings on the proposed addition of new
chemicals.
With respect to the hydrochloric and sulfuric acid, these chemicals
were added to List II by final order published in the Federal Register
on September 22, 1992 (57 FR 43615). The justification for the action
was provided in the Federal Register notice regarding the addition of
the two chemicals. With respect to nitroethane and benzaldehyde,
Section 8 of the DCDCA amended Section 802(34) of the CSA to add the
chemicals to List I; there addition to Section 1310.02 is simply a
conforming amendment. Regarding the thresholds, benzaldehyde and
nitroethane are diverted and used in clandestine laboratories for the
illicit manufacture of controlled stimulants in a manner similar to
other List I chemicals. These other chemicals, with the exception of
ephedrine, have established threshold levels that were based on a
review of data regarding the quantities distributed and used licitly,
the quantities diverted and used illicitly, and the amount of each
chemical necessary to synthesize a certain amount of controlled
substance. DEA has reviewed the same type of data for benzaldehyde and
nitroethane and found that the data supported the establishment of
similar thresholds for the two chemicals. The specific thresholds of 4
kilograms for benzaldehyde and 2.5 kilograms for nitroethane were based
on the licit and illicit uses of the two chemicals, and are consistent
with the thresholds set for other List I chemicals used in the illicit
production of controlled stimulants. Regarding the third comment,
Section 1310.02 already clearly establishes that any proposed addition
or deletion of chemicals from List I or List II must be published in
the Federal Register with opportunity for public comment. It has been
DEA's experience that the notice and comment procedure provides a
satisfactory opportunity for affected persons to provide important
information and advice regarding the proposed action. The comment
period also satisfies the compelling need for quick response while
providing DEA the option to extend the comment period, should the need
for additional comment arise.
31. Two comments argued that DEA cannot regulate ``herb-containing
dietary supplements and herbs containing Ephedra and its alkaloids'' on
the grounds that the products are dietary or nutritional supplements
and not drugs.
The CDTA and DCDCA define and establish controls over List I and
List II chemicals. Under these acts, the only exceptions to the
application of regulatory controls over products containing listed
chemicals are for certain drug products that are lawfully marketed
under the Food, Drug and Cosmetic Act (21 U.S.C. 802(39)(A)(iv)) and
for chemical mixtures. Within this context, DEA has reviewed the issue
of ephedra, e.g., the entire plant or the overground portion the
ephedra plant and determined that the unprocessed plant material
ephedra and products containing the unprocessed plant material ephedra
are not subject to the regulatory provisions of the CDTA and DCDCA.
However, preparations of the ephedra plant, such as extracts and
concentrates, that contain ephedrine, do fall within the definition of
chemical mixture (21 C.F.R. 1310.01(g)), thus, they are subject to the
regulations as they apply to chemical mixtures. Chemical mixtures are
currently exempt from the regulatory provisions of the CDTA and DCDCA,
pending promulgation of regulations concerning the exemption of
chemical mixtures.
32. One comment requested clarification of what constitutes
``unusual or excessive loss or disappearance of a listed chemical.''
This term applies to circumstances that appear to be outside the
framework of normal business occurrences. Regulated persons and
registrants understand the nature of their chemical activities and
should be able to make informed decisions as to whether the above term
applies to conditions they may encounter and to be able to explain
their decision sufficiently to convince a ``reasonable person.''
33. One comment requested clarification of the term transshipments.
For purposes of DEA's regulations, a transshipment is an
exportation of a listed chemical from one foreign country to another
foreign country, which exportation transits the jurisdiction of the
United States.
34. Two comments questioned the format of paragraphs (f)(1)(iv)(B)
and (f)(1)(iv)(C) of Section 1310.01. The first noted that while the
present format suggests independent subjects, the use [[Page 32453]] of
``and'' at the end of (B) implies that (C) is a subpart of (B). A
second comment suggested that paragraph (f)(1)(iv)(B) should contain a
reference to Section 1310.10, which sets the criteria for removal of
the exemption.
DEA agrees. The two paragraphs have been redesignated as paragraphs
(f)(1)(iv)(B)(1) and (f)(1)(iv)(B)(2) of Section 1310.01, and the
appropriate citation to Section 1310.10 will be included. Further, in
order to keep the language of the section consistent with the language
of the DCDCA, the period at the end of Section 1310.01(f)(1)(iv)(A)(4)
will be deleted and ``; or '' will be inserted in its place.
35. One comment requested clarification of the term ``imminent
danger'' as used in the revocation provisions as uses in Section
1309.44.
The term ``imminent danger'', as used in Section 1309.44, refers to
actions by a registrant that demonstrate a flagrant indifference to and
disregard for the law and the health and safety of the public. There
are no specific criteria for determining what constitutes ``imminent
danger''. However, interested persons may wish to review the Federal
Register for past notices of suspension of controlled substance
registrations. In any action under this section related to the
activities of a specific registrant, DEA will list the facts that are
considered to present an imminent danger.
36. One comment requested clarification of Section
1310.01(f)(1)(ii), with specific emphasis on whether a common or
contract carrier would be required to register with DEA for activities
involving the delivery of a listed chemical either to or by the
carrier.
Section 1310.01(f)(1)(ii) specifically excludes the delivery of a
listed chemical by a common or contract carrier for carriage in the
lawful and usual course of business from the definition of a regulated
transaction. The common or contract carrier is not subject to the
registration requirement when transporting chemicals on a registrant's
behalf. The registrant remains responsible for the listed chemicals
until they are delivered to and accepted by the consignee. In this
regard, it is important that a registrant take reasonable measures to
insure that any common or contract carrier used to ship listed
chemicals to customers will provide adequate security against in-
transit losses or thefts.
37. Two comments questioned the provisions in Sections 1310.11(b)
and 1310.15(b), which establish recordkeeping and reporting
requirements for regulated persons who manufacture exempted drug
products, on the grounds that a person who manufactures an exempted
drug product is not a regulated person.
The referenced sections as well as Section 1310.13(b), were written
with respect to a regulated person who also manufactures an exempted
drug product. Upon further consideration, DEA has determined that
regulated persons should not be required, solely because of their
status as a regulated person, to keep records and make reports of
transactions that would otherwise be exempted from those requirements.
Sections 1310.11(b), 1310.13(b) and 1310.15(b) have been removed.
38. One comment requested clarification of Section 1309.45 and
raised questions regarding procedures to be followed if an application
for registration renewal form (DEA Form 510a) is not received in a
timely manner.
Section 1309.45 applies only to a registrant who is subject to
action by the Administrator to revoke or suspend his or her
registration. If the registrant submits a renewal application within
the prescribed time period and the Administrator has not issued a final
order suspending or revoking the registration, then the registration is
deemed to continue in effect until the Administrator issues his final
order. As to renewal in circumstances other than those set out in
Section 1309.45, Section 1309.32(c) establishes the procedures. DEA
will mail out renewal notices to registrants approximately 60 days
prior to the date of expiration. If a registrant has not received their
renewal notice within 45 days of their expiration date, then a written
request for a replacement form must be provided to DEA. A properly
completed renewal application and fee must be received by DEA prior to
the registrant's expiration date if registration is to be continued
without interruption. If a registration is allowed to expire, the
registrant is no longer authorized to distribute, import or export a
List I chemical. DEA will mail delinquency notices to expired
registrants approximately 90 days after the expiration date.
39. One comment questioned the DEA's placing priority on the
completion of pre-registration investigations of non-retail firms while
DEA's Federal Register notice of March 17, 1994 (59 FR 12562,
Elimination of Threshold for Ephedrine) focused on the diversion of
ephedrine tablets at the retail level. The comment also questioned why
DEA has proposed steps to lessen the impact on retail distributors and
yet has not specifically proposed steps to lessen the impact on non-
retail distributors.
By directing its focus at the non-retail level during the initial
registration phase, DEA will identify those firms that have failed to
adequately identify their customers or have been shipping to
questionable retail firms. With this information, DEA can focus its
initial retail investigations on the most likely sources of diversion.
With respect to the second question, DEA has taken steps to limit the
impact of the chemical controls on all persons. The exemption from the
registration requirement in Section 1309.25 applies to any person,
either retail or non-retail, registered with DEA to handle controlled
substances, who also engages in activities with regulated ephedrine
drug products. Further, DEA has attempted to design the chemical
control requirements to be consistent with existing business practices,
as noted in comment number 26 with respect to the recordkeeping
requirements.
40. One comment objected to the exclusion of mail order activities
from the definition of retail distribution.
As noted in the supplemental information to the NPRM, retail
distributors engage in a limited activity as regulated by the DCDCA.
The amounts of product distributed per transaction are generally small
and sales are to individuals only. By contrast, it has been DEA's
experience that mail order distributors of ephedrine drug products that
are regulated deal with both individuals and businesses and the volume
of sales and product can be quite large. Additionally, such firms are
often less readily able to positively identify their customers.
Investigations will be significantly more complex and time consuming
for a mail order distributor than for a retail distributor. It is
appropriate that mail order activities remain classified as
distributors rather than retail distributors.
Protection of Confidential Business Information
41. Four comments expressed concern regarding the safeguarding of
confidential business information (CBI) that will be collected by DEA
in connection with chemical control activities. Two of the comments
suggested that DEA establish specific and strong provisions regarding
protection of CBI.
DEA operates national diversion control programs related to
controlled substances and listed chemicals. The controlled substance
program has been in effect since the early 1970's and the chemical
program since the late 1980's. [[Page 32454]] In each program, DEA
collects CBI in the course of investigations and required reporting.
With respect to the chemical program, the release of CBI that is
protected from disclosure under Exemption 4 of the Freedom of
Information Act, 5 U.S.C. 552(b)(4) (FOIA), is governed by Section
830(c) of the CSA (21 U.S.C. 830(c)) and the Department of Justice
procedures set forth in 28 CFR 16.7.
Section 830(c) provides that information collected under Section
830 that is protected from disclosure under Exemption 4 may only be
released in circumstances related to the enforcement of controlled
substance or chemical laws, customs laws, or for compliance with U.S.
obligations under treaty or international agreements. The Department of
Justice procedures establish that if a FOIA request is received for
release of information that is protected under Exemption 4, the
submitter of the protected information must be notified of such a
request, given an opportunity to object to the disclosure and allowed
to provide justification as to why the information should not be
disclosed.
In addition to the statutory and regulatory requirements, DEA has
established internal guidelines governing the handling of CBI,
including provisions that the material be maintained in locked
containers, that access to the information be on a need-to-know basis,
and that any disclosure under Section 830 be made only pursuant to a
non-disclosure agreement by the receiving party.
This regulation has been drafted and reviewed in accordance with
Executive Order 12866, Section 1(b), Principals of Regulation. The DEA
has determined that this rule is a significant regulatory action under
Executive Order 12866, Section 3(f), Regulatory Planning and Review,
and accordingly this rule has been reviewed by the Office of Management
and Budget.
This action has been analyzed in accordance with the principles and
criteria in Executive Order 12612, and it has been determined that the
proposed rule does not have sufficient federalism implications to
warrant the preparation of a Federalism Assessment.
List of Subjects
21 CFR Part 1307
Drug traffic control.
21 CFR Part 1309
Administrative practice and procedure, Drug Traffic Control,
Security measures, List I and List II chemicals.
21 CFR Part 1310
Drug Traffic Control, Reporting Requirements, List I and List II
chemicals.
21 CFR Part 1313
Drug Traffic Control, Imports, Exports, Transshipment and in-
transit shipments, List I and List II Chemicals.
21 CFR Part 1316
Administrative practice and procedure, Drug Traffic Control,
Research, Seizures and forfeitures.
For the reasons set out above, 21 CFR Parts 1307, 1309, 1310, 1313
and 1316 are amended as follows:
PART 1307--[AMENDED]
1. The authority citation for part 1307 continues to read as
follows:
Authority: 21 U.S.C. 821, 822(d), 871(b), unless otherwise
noted.
2. Section 1307.03 is revised to read as follows:
Sec. 1307.03 Exceptions to regulations.
Any person may apply for an exception to the application of any
provision of parts 1301-1313, or 1316 of this chapter by filing a
written request stating the reasons for such exception. Requests shall
be filed with the Administrator, Drug Enforcement Administration,
Department of Justice, Washington, D.C. 20537. The Administrator may
grant an exception in his discretion, but in no case shall he be
required to grant an exception to any person which is not otherwise
required by law or the regulations cited in this section.
1. 21 CFR Part 1309 is added to read as follows:
PART 1309--REGISTRATION OF MANUFACTURERS, DISTRIBUTORS, IMPORTERS
AND EXPORTERS OF LIST I CHEMICALS
General Information
Sec.
1309.01 Scope of part 1309.
1309.02 Definitions.
1309.03 Information; special instructions.
Fees for Registration and Reregistration
1309.11 Fee amounts.
1309.12 Time and method of payment; refund.
Requirements for Registration
1309.21 Persons required to register.
1309.22 Separate registration for independent activities.
1309.23 Separate registration for separate locations.
1309.24 Exemption of agents and employees.
1309.25 Exemption of certain controlled substance registrants.
1309.26 Exemption of law enforcement officials.
1309.27 Exemption of certain manufacturers.
Application for Registration
1309.31 Time for application for registration; expiration date.
1309.32 Application forms; contents, signature.
1309.33 Filing of application; joint filings.
1309.34 Acceptance for filing; defective applications.
1309.35 Additional information.
1309.36 Amendments to and withdrawals of applications.
Action on Applications for Registration: Revocation or Suspension of
Registration
1309.41 Administrative review generally.
1309.42 Certificate of registration; denial of registration.
1309.43 Suspension or revocation of registration.
1309.44 Suspension of registration pending final order.
1309.45 Extension of registration pending final order.
1309.46 Order to show cause.
Hearings
1309.51 Hearings generally.
1309.52 Purpose of hearing.
1309.53 Waiver or modification of rules.
1309.54 Request for hearing or appearance; waiver.
1309.55 Burden of proof.
1309.56 Time and place of hearing.
1309.57 Final order.
Modification, Transfer and Termination of Registration
1309.61 Modification in registration.
1309.62 Termination of registration.
1309.63 Transfer of registration.
Security Requirements
1309.71 General security requirements.
1309.72 Felony conviction; employer responsibilities.
1309.73 Employee responsibility to report diversion.
Authority: 21 U.S.C. 821, 822, 823, 824, 830, 871(b), 875, 877,
958.
General Information
Sec. 1309.01 Scope of Part 1309.
Procedures governing the registration of manufacturers,
distributors, importers and exporters of List I chemicals pursuant to
Sections 102, 302, 303, 1007 and 1008 of the Act (21 U.S.C. 802, 822,
823, 957 and 958) are set forth generally by those sections and
specifically by the sections of this part.
Sec. 1309.02 Definitions.
(a) The term Act means the Controlled Substances Act (84 Stat.
1242; 21 U.S.C. 801) and/or the Controlled Substances Import and Export
Act (84 Stat. 1285; 21 U.S.C. 951).
(b) The term hearing means any hearing held pursuant to the part
for the [[Page 32455]] granting, denial, revocation, or suspension of a
registration pursuant to sections 303 and 304 of the Act (21 U.S.C.
823-824).
(c) The term person includes any individual, corporation,
government or governmental subdivision or agency, business trust,
partnership, association, or other legal entity.
(d) The term register and registration refer only to registration
required and permitted by sections 302 and 1007 of the Act (21 U.S.C.
822 and 957).
(f) The term registrant means any person who is registered pursuant
to either section 303 or section 1008 of the Act (21 U.S.C. 823 and
958).
(g) The term retail distributor means a distributor whose List I
chemical activities are restricted to the sale of drug products that
are regulated as List I chemicals pursuant to Section
1310.01(f)(1)(iv), directly to walk-in customers for personal use.
(h) Any term not defined in this section shall have the definition
set forth in section 102 of the Act (21 U.S.C. 802) or in Sections
1310.01 and 1313.02 of this chapter.
Sec. 1309.03 Information; special instructions.
Information regarding procedures under these rules and instructions
supplementing these rules will be furnished upon request by writing to
the Drug Enforcement Administration, Chemical Operations Section,
Office of Diversion Control, Washington, D.C. 20537.
Fees for Registration and Reregistration
Sec. 1309.11 Fee amounts.
(a) For each initial registration to manufacture for distribution,
distribute, import, or export, the applicant shall pay a fee of $595
for a annual registration.
(b) For each reregistration to manufacture for distribution,
distribute, import, or export, the registrant shall pay a fee of $477
for an annual registration.
(c) For each initial registration to conduct business as a retail
distributor the applicant shall pay an application processing fee of $7
and an investigation fee of $248, for an annual registration.
(d) For each reregistration to conduct business as a retail
distributor the registrant shall pay a fee of $116.
Sec. 1309.12 Time and method of payment; refund.
(a) For each application for registration or reregistration to
manufacture for distribution, distribute, import, or export, the
applicant shall pay the fee when the application for registration or
reregistration is submitted for filing.
(b) For retail the distributor initial applications, the applicant
shall pay the application processing fee when the application for
registration is submitted for filing. The investigation fee shall be
paid within 30 days DEA notifies the applicant that the preregistration
investigation has been scheduled.
(c) For retail distributor reregistration applications, the
registrant shall pay the fee when the application for reregistration is
submitted for filing.
(d) Payments should be made in the form of a personal, certified,
or cashier's check or money order made payable to ``Drug Enforcement
Administration.'' Payments made in the form of stamps, foreign
currency, or third party endorsed checks will not be accepted. These
application fees are not refundable.
Requirements for Registration
Sec. 1309.21 Persons required to register.
(a) Every person who distributes, imports, or exports any List I
chemical, other than those List I chemicals contained in a product
exempted under Sec. 1310.01(f)(1)(iv), or who proposes to engage in the
distribution, importation, or exportation of any List I chemical, shall
obtain annually a registration specific to the List I chemicals to be
handled, unless exempted by law or pursuant to Secs. 1309.24 through
1309.27. Only persons actually engaged in such activities are required
to obtain a registration; related or affiliated persons who are not
engaged in such activities are not required to be registered. (For
example, a stockholder or parent corporation of a corporation
distributing List I chemicals is not required to obtain a
registration.)
(b) Every person who distributes or exports a List I chemical they
have manufactured, other than a List I chemical contained in a product
exempted under Sec. 1310.01(f)(1)(iv), or proposes to distribute or
export a List I chemical they have manufactured, shall obtain annually
a registration specific to the List I chemicals to be handled, unless
exempted by law or pursuant to Secs. 1309.24 through 1309.27.
Sec. 1309.22 Separate registration for independent activities.
(a) The following groups of activities are deemed to be independent
of each other:
(1) Retail distributing of List I chemicals;
(2) Non-Retail distributing of List I chemicals;
(3) Importing List I chemicals; and
(4) Exporting List I chemicals.
(b) Every person who engages in more than one group of independent
activities shall obtain a separate registration for each group of
activities, unless otherwise exempted by the Act or Secs. 1309.24
through 1309.26, except that a person registered to import any List I
chemical shall be authorized to distribute that List I chemical after
importation, but no other chemical that the person is not registered to
import.
Sec. 1309.23 Separate registration for separate locations.
(a) A separate registration is required for each principal place of
business at one general physical location where List I chemicals are
distributed, imported, or exported by a person.
(b) The following locations shall be deemed to be places not
subject to the registration requirement:
(1) A warehouse where List I chemicals are stored by or on behalf
of a registered person, unless such chemicals are distributed directly
from such warehouse to locations other than the registered location
from which the chemicals were originally delivered; and
(2) An office used by agents of a registrant where sales of List I
chemicals are solicited, made, or supervised but which neither contains
such chemicals (other than chemicals for display purposes) nor serves
as a distribution point for filling sales orders.
Sec. 1309.24 Exemption of agents and employees.
The requirement of registration is waived for any agent or employee
of a person who is registered to engage in any group of independent
activities, if such agent or employee is acting in the usual course of
his or her business or employment.
Sec. 1309.25 Exemption of certain controlled substance registrants.
(a) The requirement of registration is waived for any person who
distributes a product containing a List I chemical that is regulated
pursuant to Sec. 1310.01(f)(1)(iv), if that person is registered with
the Administration to manufacture, distribute or dispense a controlled
substance.
(b) The requirement of registration is waived for any person who
imports or exports a product containing a List I chemical that is
regulated pursuant to Sec. 1310.01(f)(1)(iv), if that person is
registered with the Administration to engage in the same activity with
a controlled substance.
(c) The Administrator may, upon finding that continuation of the
waiver would not be in the public interest, suspend or revoke a
person's waiver [[Page 32456]] pursuant to the procedures set forth in
Secs. 1309.43 through 1309.46 and 1309.51 through 1309.57. In
considering the revocation or suspension of a person's waiver, the
Administrator shall also consider whether action to revoke or suspend
the person's controlled substance registration pursuant to 21 U.S.C.
824 is warranted.
(d) Any person exempted from the registration requirement under
this section shall comply with the security requirements set forth in
Sections 1309.71-1309.73 and the recordkeeping and reporting
requirements set forth under Parts 1310 and 1313 of this chapter.
Sec. 1309.26 Exemption of law enforcement officials.
(a) The requirement of registration is waived for the following
persons in the circumstances described in this section:
(1) Any officer or employee of the Administration, any officer of
the U.S. Customs Service, any officer or employee of the United States
Food and Drug Administration, any other Federal officer who is lawfully
engaged in the enforcement of any Federal law relating to listed
chemicals, controlled substances, drugs or customs, and is duly
authorized to possess and distribute List I chemicals in the course of
official duties; and
(2) Any officer or employee of any State, or any political
subdivision or agency thereof, who is engaged in the enforcement of any
State or local law relating to listed chemicals and controlled
substances and is duly authorized to possess and distribute List I
chemicals in the course of his official duties.
(b) Any official exempted by this section may, when acting in the
course of official duties, possess any List I chemical and distribute
any such chemical to any other official who is also exempted by this
section and acting in the course of official duties.
Sec. 1309.27 Exemption of certain manufacturers.
The requirement of registration is waived for any manufacturer of a
List I chemical, if that chemical is produced solely for internal
consumption by the manufacturer and there is no subsequent distribution
or exportation of the List I chemical.
Application for Registration
Sec. 1309.31 Time for application for registration; expiration date.
(a) Any person who is required to be registered and who is not so
registered may apply for registration at any time. No person required
to be registered shall engage in any activity for which registration is
required until the application for registration is approved and a
Certificate of Registration is issued by the Administrator to such
person.
(b) Any person who is registered may apply to be reregistered not
more than 60 days before the expiration date of his registration.
(c) At the time a person is first registered, that person shall be
assigned to one of twelve groups, which shall correspond to the months
of the year. The expiration date of the registrations of all
registrants within any group will be the last day of the month
designated for that group. In assigning any of the above persons to a
group, the Administration may select a group the expiration date of
which is less than one year from the date such business activity was
registered. If the person is assigned to a group which has an
expiration date less than eleven months from the date of which the
person is registered, the registration shall not expire until one year
from that expiration date; in all other cases, the registration shall
expire on the expiration date following the date on which the person is
registered.
Sec. 1309.32 Application forms; contents; signature.
(a) Any person who is required to be registered pursuant to Section
1309.21 and is not so registered, shall apply on DEA Form 510.
(b) Any person who is registered pursuant to Section 1309.21, shall
apply for reregistration on DEA Form 510a.
(c) DEA Form 510 may be obtained at any divisional office of the
Administration or by writing to the Registration Unit, Drug Enforcement
Administration, Department of Justice, Post Office Box 28083, Central
Station, Washington, DC 20005. DEA Form 510a will be mailed to each
List I chemical registrant approximately 60 days before the expiration
date of his or her registration; if any registered person does not
receive such forms within 45 days before the expiration date of the
registration, notice must be promptly given of such fact and DEA Form
510a must be requested by writing to the Registration Unit of the
Administration at the foregoing address.
(d) Each application for registration shall include the
Administration Chemical Code Number, as set forth in Section 1310.02 of
this chapter, for each List I chemical to be distributed, imported, or
exported.
(e) Registration shall not entitle a person to engage in any
activity with any List I chemical not specified in his or her
application.
(f) Each application shall include all information called for in
the form, unless the item is not applicable, in which case this fact
shall be indicated.
(g) Each application, attachment, or other document filed as part
of an application, shall be signed by the applicant, if an individual;
by a partner of the applicant, if a partnership; or by an officer of
the applicant, if a corporation, corporate division, association, trust
or other entity. An applicant may authorize one or more individuals,
who would not otherwise be authorized to do so, to sign applications
for the applicant by filing with the application or other document a
power of attorney for each such individual. The power of attorney shall
be signed by a person who is authorized to sign applications under this
paragraph and shall contain the signature of the individual being
authorized to sign the application or other document. The power of
attorney shall be valid until revoked by the applicant.
Sec. 1309.33 Filing of application; joint filings.
(a) All applications for registration shall be submitted for filing
to the Registration Unit, Drug Enforcement Administration, Chemical
Registration/ODC, Post Office Box 2427, Arlington, Virginia 22202-2427.
The appropriate registration fee and any required attachments must
accompany the application.
(b) Any person required to obtain more than one registration may
submit all applications in one package. Each application must be
complete and must not refer to any accompanying application for
required information.
Sec. 1309.34 Acceptance for filing; defective applications.
(a) Applications submitted for filing are dated upon receipt. If
found to be complete, the application will be accepted for filing.
Applications failing to comply with the requirements of this part will
not generally be accepted for filing. In the case of minor defects as
to completeness, the Administrator may accept the application for
filing with a request to the applicant for additional information. A
defective application will be returned to the applicant within 10 days
of receipt with a statement of the reason for not accepting the
application for filing. A defective application may be corrected and
resubmitted for filing at any time.
(b) Accepting an application for filing does not preclude any
subsequent request for additional information [[Page 32457]] pursuant
to Section 1309.35 and has no bearing on whether the application will
be granted.
Sec. 1309.35 Additional information.
The Administrator may require an applicant to submit such documents
or written statements of fact relevant to the application as he deems
necessary to determine whether the application should be granted. The
failure of the applicant to provide such documents or statements within
a reasonable time after being requested to do so shall be deemed to be
a waiver by the applicant of an opportunity to present such documents
or facts for consideration by the Administrator in granting or denying
the application.
Sec. 1309.36 Amendments to and withdrawals of applications.
(a) An application may be amended or withdrawn without permission
of the Administration at any time before the date on which the
applicant receives an order to show cause pursuant to Sec. 1309.46. An
application may be amended or withdrawn with permission of the
Administrator at any time where good cause is shown by the applicant or
where the amendment or withdrawal is in the public interest.
(b) After an application has been accepted for filing, the request
by the applicant that it be returned or the failure of the applicant to
respond to official correspondence regarding the application, including
a request that the applicant submit the required fee, when sent by
registered or certified mail, return receipt requested, shall be deemed
to be a withdrawal of the application.
Action on Applications for Registration: Revocation or Suspension
of Registration
Sec. 1309.41 Administrative review generally.
The Administrator may inspect, or cause to be inspected, the
establishment of an applicant or registrant, pursuant to subpart A of
Part 1316 of this chapter. The Administrator shall review the
application for registration and other information gathered by the
Administrator regarding an applicant in order to determine whether the
applicable standards of Section 303 of the Act (21 U.S.C. 823) have
been met by the applicant.
Sec. 1309.42 Certificate of registration; denial of registration.
(a) The Administrator shall issue a Certificate of Registration
(DEA Form 511) to an applicant if the issuance of registration or
reregistration is required under the applicable provisions of section
303 of the Act (21 U.S.C. 823). In the event that the issuance of
registration or reregistration is not required, the Administrator shall
deny the application. Before denying any application, the Administrator
shall issue an order to show cause pursuant to Section 1309.46 and, if
requested by the applicant, shall hold a hearing on the application
pursuant to Sec. 1309.51.
(b) The Certificate of Registration (DEA Form 511) shall contain
the name, address, and registration number of the registrant, the
activity authorized by the registration, the amount of fee paid, and
the expiration date of the registration. The registrant shall maintain
the certificate of registration at the registered location in a readily
retrievable manner and shall permit inspection of the certificate by
any official, agent or employee of the Administration or of any
Federal, State, or local agency engaged in enforcement of laws relating
to List I chemicals or controlled substances.
Sec. 1309.43 Suspension or revocation of registration.
(a) The Administrator may suspend any registration pursuant to
section 304(a) of the Act (21 U.S.C. 824(a)) for any period of time he
determines.
(b) The Administrator may revoke any registration pursuant to
section 304(a) of the Act (21 U.S.C. 824(a)).
(c) Before revoking or suspending any registration, the
Administrator shall issue an order to show cause pursuant to Section
1309.46 and, if requested by the registrant, shall hold a hearing
pursuant to Section 1309.51. Notwithstanding the requirements of this
Section, however, the Administrator may suspend any registration
pending a final order pursuant to Sec. 1309.44.
(d) Upon service of the order of the Administrator suspending or
revoking registration, the registrant shall immediately deliver his or
her Certificate of Registration to the nearest office of the
Administration.
Sec. 1309.44 Suspension of registration pending final order.
(a) The Administrator may suspend any registration simultaneously
with or at any time subsequent to the service upon the registrant of an
order to show cause why such registration should not be revoked or
suspended, in any case where he finds that there is an imminent danger
to the public health or safety. If the Administrator so suspends, he
shall serve with the order to show cause pursuant to Sec. 1309.46 an
order of immediate suspension that shall contain a statement of his
findings regarding the danger to public health or safety.
(b) Upon service of the order of immediate suspension, the
registrant shall promptly return his Certificate of Registration to the
nearest office of the Administration.
(c) Any suspension shall continue in effect until the conclusion of
all proceedings upon the revocation or suspension, including any
judicial review thereof, unless sooner withdrawn by the Administrator
or dissolved by a court of competent jurisdiction. Any registrant whose
registration is suspended under this section may request a hearing on
the revocation or suspension of his registration at a time earlier than
specified in the order to show cause pursuant to Section 1309.46, which
request shall be granted by the Administrator, who shall fix a date for
such hearing as early as reasonably possible.
Sec. 1309.45 Extension of registration pending final order.
In the event that an applicant for reregistration (who is doing
business under a registration previously granted and not revoked or
suspended) has applied for reregistration at least 45 days before the
date on which the existing registration is due to expire, and the
Administrator has issued no order on the application on the date on
which the existing registration is due to expire, the existing
registration of the applicant shall automatically be extended and
continue in effect until the date on which the Administrator so issues
his order. The Administrator may extend any other existing registration
under the circumstances contemplated in this section even though the
registrant failed to apply for reregistration at least 45 days before
expiration of the existing registration, with or without request by the
registrant, if the Administrator finds that such extension is not
inconsistent with the public health and safety.
Sec. 1309.46 Order to show cause.
(a) If, upon examination of the application for registration from
any applicant and other information gathered by the Administration
regarding the applicant, the Administrator is unable to make the
determinations required by the applicable provisions of section 303 of
the Act (21 U.S.C. 823) to register the applicant, the Administrator
shall serve upon the applicant an order to show cause why the
application for registration should not be denied. [[Page 32458]]
(b) If, upon information gathered by the Administration regarding
any registrant, the Administrator determines that the registration of
such registrant is subject to suspension or revocation pursuant to
section 304 of the Act (21 U.S.C. 824), the Administrator shall serve
upon the registrant an order to show cause why the registration should
not be revoked or suspended.
(c) The order to show cause shall call upon the applicant or
registrant to appear before the Administrator at a time and place
stated in the order, which shall not be less than 30 days after the
date of receipt of the order. The order to show cause shall also
contain a statement of the legal basis for such hearing and for the
denial, revocation, or suspension of registration and a summary of the
matters of fact and law asserted.
(d) Upon Receipt of an order to show cause, the applicant or
registrant must, if he desires a hearing, file a request for a hearing
pursuant to Sec. 1309.54. If a hearing is requested, the Administrator
shall hold a hearing at the time and place stated in the order,
pursuant to Sec. 1309.51.
(e) When authorized by the Administrator, any agent of the
Administration may serve the order to show cause.
Hearings
Sec. 1309.51 Hearings generally.
(a) In any case where the Administrator shall hold a hearing on any
registration or application therefore, the procedures for such hearing
shall be governed generally by the adjudication procedures set forth in
the Administrative Procedure Act (5 U.S.C. 551-559) and specifically by
sections 303 and 304 of the Act (21 U.S.C. 823-824), by Secs. 1309.52
through 1309.57, and by the procedures for administrative hearings
under the Act set forth in Secs. 1316.41 through 1316.67 of this
chapter.
(b) Any hearing under this part shall be independent of, and not in
lieu of, criminal prosecutions or other proceedings under the Act or
any other law of the United States.
Sec. 1309.52 Purpose of hearing.
If requested by a person entitled to a hearing, the Administrator
shall hold a hearing for the purpose of receiving factual evidence
regarding the issues involved in the denial, revocation, or suspension
of any registration. Extensive argument should not be offered into
evidence but rather presented in opening or closing statements of
counsel or in memoranda or proposed findings of fact and conclusions of
law.
Sec. 1309.53 Waiver or modification of rules.
The Administrator or the presiding officer (with respect to matters
pending before him) may modify or waive any rule in this part by notice
in advance of the hearing, if he determines that no party in the
hearing will be unduly prejudiced and the ends of justice will thereby
be served. Such notice of modification or waiver shall be made a part
of the record of the hearing.
Sec. 1309.54 Request for hearing or appearance; waiver.
(a) Any person entitled to a hearing pursuant to Secs. 1309.42 and
1309.43 and desiring a hearing shall, within 30 days after the date of
receipt of the order to show cause, file with the Administrator a
written request for a hearing in the form prescribed in Sec. 1316.47 of
this chapter.
(b) Any person entitled to a hearing pursuant to Secs. 1309.42 and
1309.43 may, within the period permitted for filing a request for a
hearing, file with the Administrator a waiver of an opportunity for a
hearing, together with a written statement regarding his position on
the matters of fact and law involved in such hearing. Such statement,
if admissible, shall be made a part of the record and shall be
considered in light of the lack of opportunity for cross-examination in
determining the weight to be attached to matters of fact asserted
therein.
(c) If any person entitled to a hearing pursuant to Secs. 1309.42
and 1309.43 fails to file a request for a hearing, or if he so files
and fails to appear at the hearing, he shall be deemed to have waived
his opportunity for the hearing, unless he shows good cause for such
failure.
(d) If any person entitled to a hearing waives or is deemed to
waive his or her opportunity for the hearing, the Administrator may
cancel the hearing, if scheduled, and issue his final order pursuant to
Sec. 1309.57 without a hearing.
Sec. 1309.55 Burden of proof.
(a) At any hearing for the denial of a registration, the
Administration shall have the burden of proving that the requirements
for such registration pursuant to section 303 of the Act (21 U.S.C.
823) are not satisfied.
(b) At any hearing for the revocation or suspension of a
registration, the Administration shall have the burden of proving that
the requirements for such revocation or suspension pursuant to section
304(a) of the Act (21 U.S.C. 824(a)) are satisfied.
Sec. 1309.56 Time and place of hearing.
The hearing will commence at the place and time designated in the
order to show cause or notice of hearing published in the Federal
Register (unless expedited pursuant to Section 1309.44(c)) but
thereafter it may be moved to a different place and may be continued
from day to day or recessed to a later day without notice other than
announcement thereof by the presiding officer at the hearing.
Sec. 1309.57 Final order.
As soon as practicable after the presiding officer has certified
the record to the Administrator, the Administrator shall cause to be
published in the Federal Register his final order in the proceeding,
which shall set forth the final rule and the findings of fact and
conclusions of law upon which the rule is based. This order shall
specify the date on which it shall take effect, which date shall not be
less than 30 days from the date of publication in the Federal Register
unless the Administrator finds that the public interest in the matter
necessitates an earlier effective date, in which case the Administrator
shall specify in the order his findings as to the conditions which led
him to conclude that an earlier effective date was required.
Modification, Transfer and Termination of Registration
Sec. 1309.61 Modification in registration.
Any registrant may apply to modify his or her registration to
authorize the handling of additional List I chemicals or to change his
or her name or address, by submitting a letter of request to the Drug
Enforcement Administration, Chemical Registration/ODC, Post Office Box
2427, Arlington, Virginia 22202-2427. The letter shall contain the
registrant's name, address, and registration number as printed on the
certificate of registration, and the List I chemicals to be added to
his registration or the new name or address and shall be signed in
accordance with Sec. 1309.32(g). No fee shall be required to be paid
for the modification. The request for modification shall be handled in
the same manner as an application for registration. If the modification
in registration is approved, the Administrator shall issue a new
certificate of registration (DEA Form 511) to the registrant, who shall
maintain it with the old certificate of registration until expiration.
Sec. 1309.62 Termination of registration.
The registration of any person shall terminate if and when such
person dies, ceases legal existence, or discontinues
[[Page 32459]] business or professional practice. Any registrant who
ceases legal existence or discontinues business or professional
practice shall notify the Administrator promptly of such fact.
Sec. 1309.63 Transfer of registration.
No registration or any authority conferred thereby shall be
assigned or otherwise transferred except upon such conditions as the
Administrator may specifically designate and then only pursuant to his
written consent.
Security Requirements
Sec. 1309.71 General security requirements.
(a) All applicants and registrants shall provide effective controls
and procedures to guard against theft and diversion of List I
chemicals. Specific attention shall be paid to storage of and
controlling access to List I chemicals as follows:
(1) Chemicals shall be stored in containers sealed in such a manner
as to indicate any attempts at tampering with the container. Where
chemicals cannot be stored in sealed containers, access to the
chemicals should be controlled through physical means or through human
or electronic monitoring.
(2) In retail settings open to the public where drugs containing
List I chemicals that are regulated pursuant to Sec. 1310.01(f)(1)(iv)
are distributed, such drugs will be stocked behind a counter where only
employees have access.
(b) In evaluating the effectiveness of security controls and
procedures, the Administrator shall consider the following factors:
(1) The type, form, and quantity of List I chemicals handled;
(2) The location of the premises and the relationship such location
bears on the security needs;
(3) The type of building construction comprising the facility and
the general characteristics of the building or buildings;
(4) The availability of electronic detection and alarm systems;
(5) the extent of unsupervised public access to the facility;
(6) The adequacy of supervision over employees having access to
List I chemicals;
(7) The procedures for handling business guests, visitors,
maintenance personnel, and nonemployee service personnel in areas where
List I chemicals are processed or stored;
(8) The adequacy of the registrant's or applicant's systems for
monitoring the receipt, distribution, and disposition of List I
chemicals in its operations.
(c) Any registrant or applicant desiring to determine whether a
proposed system of security controls and procedures is adequate may
submit materials and plans regarding the proposed security controls and
procedures either to the Special Agent in Charge in the region in which
the security controls and procedures will be used, or to the Chemical
Operations Section Office of Diversion Control, Drug Enforcement
Administration, Washington, D.C. 20537.
Sec. 1309.72 Felony conviction; employer responsibilities.
(a) The registrant shall exercise caution in the consideration of
employment of persons who will have access to listed chemicals, who
have been convicted of a felony offense relating to controlled
substances or listed chemicals, or who have, at any time, had an
application for registration with the DEA denied, had a DEA
registration revoked, or surrendered a DEA registration for cause. (For
purposes of this subsection, the term ``for cause'' means a surrender
in lieu of, or as a consequence of, any Federal or State
administrative, civil or criminal action resulting from an
investigation of the individual's handling of controlled substances or
listed chemicals.) The registrant should be aware of the circumstances
regarding the action against the potential employee and the
rehabilitative efforts following the action. The registrant shall
assess the risks involved in employing such persons, including the
potential for action against the registrant pursuant to Sec. 1309.43,
If such person is found to have diverted listed chemicals, and, in the
event of employment, shall institute procedures to limit the potential
for diversion of List I chemicals.
(b) It is the position of DEA that employees who possess, sell, use
or divert listed chemicals or controlled substances will subject
themselves not only to State or Federal prosecution for any illicit
activity, but shall also immediately become the subject of independent
action regarding their continued employment. The employer will assess
the seriousness of the employee's violation, the position of
responsibility held by the employee, past record of employment, etc.,
in determining whether to suspend, transfer, terminate or take other
action against the employee.
Sec. 1309.73 Employee responsibility to report diversion.
Reports of listed chemical diversion by fellow employees is not
only a necessary part of an overall employee security program but also
serves the public interest at large. It is, therefore, the position of
DEA that an employee who has knowledge of diversion from his employer
by a fellow employee has an obligation to report such information to a
responsible security official of the employer. The employer shall treat
such information as confidential and shall take all reasonable steps to
protect the confidentiality of the information and the identity of the
employee furnishing information. A failure to report information of
chemical diversion will be considered in determining the feasibility of
continuing to allow an employee to work in an area with access to
chemicals. The employer shall inform all employees concerning this
policy.
PART 1310--[AMENDED]
1. The authority citation for part 1310 continues to read as
follows:
Authority: 21 U.S.C. 802, 830, 871(b).
2. Section 1310.01 is amended by revising paragraphs (b), (c), (d),
(e), (f)(1) and (g), redesignating paragraph (k) as paragraph (m) and
inserting new paragraphs (k) and (l) as follows:
Sec. 1310.01 Definitions.
* * * * *
(b) The term listed chemical means any List I chemical or List II
chemical.
(c) The term List I chemical means a chemical specifically
designated by the Administrator in Sec. 1310.02(a) that, in addition to
legitimate uses, is used in manufacturing a controlled substance in
violation of the Act and is important to the manufacture of a
controlled substance.
(d) The term List II chemical means a chemical, other than a List I
chemical, specifically designated by the Administrator in Section
1310.02(b) that, in addition to legitimate uses, is used in
manufacturing a controlled substance in violation of the Act.
(e) The term regulated person means any individual, corporation,
partnership, association, or other legal entity who manufactures,
distributes, imports, or exports a listed chemical, a tableting
machine, or an encapsulating machine, or who acts as a broker or trader
for an international transaction involving a listed chemical, tableting
machine, or encapsulating machine.
(f) The term regulated transaction means:
(1) A distribution, receipt, sale, importation, or exportation of a
listed chemical, or an international transaction involving shipment of
a listed chemical, or if the Administrator establishes a threshold
amount for a specific listed chemical, a threshold amount as determined
by the Administrator, which includes a cumulative threshold amount
[[Page 32460]] for multiple transactions, of a listed chemical, except
that such terms does not include:
(i) A domestic lawful distribution in the usual course of business
between agents or employees of a single regulated person; in this
context, agents or employees means individuals under the direct
management and control of the regulated person;
(ii) A delivery of a listed chemical to or by a common or contract
carrier for carriage in the lawful and usual course of the business of
the common or contract carrier, or to or by a warehouseman for storage
in the lawful and usual course of the business of the warehouseman,
except that if the carriage or storage is in connection with the
distribution, importation, or exportation of a listed chemical to a
third person, this paragraph does not relieve a distributor, importer,
or exporter from compliance with this part or parts 1309 and 1313 of
this chapter;
(iii) Any category of transaction or any category of transaction
for a specific listed chemical or chemicals specified by regulation of
the Administrator as excluded from this definition as unnecessary for
enforcement of the Act;
(iv) Any transaction in a listed chemical that is contained in a
drug that may be marketed or distributed lawfully in the United States
under the Federal Food, Drug, and Cosmetic Act unless--
(A) The drug contains ephedrine or its salts, optical isomers, or
salts of optical isomers as the only active medicinal ingredient or
contains ephedrine or its salts, optical isomers or salts of optical
isomers and therapeutically insignificant quantities of another active
medicinal ingredient. For purposes of this paragraph, the term
``therapeutically insignificant quantities'' shall apply if the product
formulation (i.e., the qualitative and quantitative composition of
active ingredients within the product) is not listed in American
Pharmaceutical Association (Apha) Handbook of Nonprescription Drugs;
Drug Facts and Comparisons (published by Wolters Kluwer Company); or
USP DI (published by authority of the United States Pharmacopeial
Convention, Inc.); or the product is not listed in Sec. 1310.15 as an
exempt drug product. For drug products having formulations not found in
the above compendiums, the Administrator shall determine, pursuant to a
written request as specified in Sec. 1310.14, whether the active
medicinal ingredients are present in quantities considered
therapeutically significant for purposes of this paragraph; or
(B) The Administrator has determined pursuant to the criteria in
Sec. 1310.10 that:
(1) The drug or group of drugs is being diverted to obtain the
listed chemical for use in the illicit production of a controlled
substance; and
(2) The quantity of ephedrine or other listed chemical contained in
the drug included in the transaction or multiple transactions equals or
exceeds the threshold established for that chemical by the
Administrator;
(v) Any transaction in a chemical mixture listed in Sec. 1310.13.
* * * * *
(g) The term chemical mixture means a combination of two or more
chemical substances, at least one of which is not a listed chemical,
except that such term does not include any combination of a listed
chemical with another chemical that is present solely as an impurity or
which has been created to evade the requirements of the act.
* * * * *
(k) The terms broker and trader mean any individual, corporation,
corporate division, partnership, association, or other legal entity
which assists in arranging an international transaction in a listed
chemical by--
(1) negotiating contracts;
(2) serving as an agent or intermediary; or
(3) fulfilling a formal obligation to complete the transaction by
bringing together a buyer and seller, a buyer and transporter, or a
seller and transporter, or by receiving any form of compensation for so
doing.
(1) The term international transaction means a transaction
involving the shipment of a listed chemical across an international
border (other than a United States border) in which a broker or trader
located in the United States participates.
* * * * *
3. Section 1310.02 is amended by revising the introductory text and
paragraphs (a) and (b) to read as follows:
Sec. 1310.02 Substances Covered.
The following chemicals have been specifically designated by the
Administrator of the Drug Enforcement Administration as the listed
chemicals subject to the provisions of this part and parts 1309 and
1313 of this chapter. Each chemical has been assigned the DEA Chemical
Code Number set forth opposite it.
(a) List I chemicals
(1) Anthranilic acid, its esters, and its salts
8530
(2) Benzyl cyanide
8735
(3) Ephedrine, its salts, optical isomers, and salts of optical isomers
8113
(4) Ergonovine and its salts
8675
(5) Ergotamine and its salts
8676
(6) N-Acetylanthranilic acid, its esters, and its salts
8522
(7) Norpseudoephedrine, its salts, optical isomers, and salts of
optical isomers
8317
(8) Phenylacetic acid, its esters, and its salts
8791
(9) Phenylpropanolamine, its salts, optical isomers, and salts of
optical isomers
1225
(10) Piperidine and its salts
2704
(11) Pseudoephedrine, its salts, optical isomers, and salts of optical
isomers
8112
(12) 3,4-Methylenedioxyphenyl-2-propanone
8502
(13) Methylamine and its salts
8520
(14) Ethylamine and its salts
8678
(15) Propionic anhydride
8328
(16) Insosafrole (Isosafrole)
8704
(17) Safrole
8323
(18) Piperonal
8750
(19) N-Methylephedrine, its salts, optical isomers, and salts of
optical isomers (N-Methylephedrine)
8115
(20) N-Methylpseudoephedrine, its salts, optical isomers, and salts of
optical isomers
8119
(21) Hydriotic acid (Hydriodic Acid)
6695
(22) Benzaldehyde
8256
(23) Nitroethane
6724
(b) List II Chemicals:
(1) Acetic anhydride
8519
(2) Acetone
6532
(3) Benzyl chloride
8570
(4) Ethyl ether
6584
(5) Potassium permanganate
6579
(6) 2-Butanone (or Methyl Ethyl Ketone or MEK)
6714
(7) Toluene
6594
(8) Hydrochloric acid
6545
(9) Sulfuric acid
6552
(10) Methyl Isobutyl Ketone (MIBK)
6715
* * * * *
4. Section 1310.04 is amended by revising paragraphs (a), (b),
(f)(1) introductory, and (f)(2) introductory text and (iv), by removing
paragraphs (f)(1)(xiv), (f)(1)(xx), and (f)(1)(xxii); redesignating
paragraphs (f)(1)(xv) through (xix) as (f)(1)(xiv) through (xviii),
paragraph (f)(1)(xxi) as (f)(1)(xix) and paragraph (f)(1)(xxiii) as
(f)(1)(xx); and adding new paragraphs (f)(1)(xxi) and (xxii) to read as
follows:
Sec. 1310.04 Maintenance of records.
(a) Every record required to be kept subject to Section 1310.03 for
a List I chemical, a tableting machine, or an encapsulating machine
shall be kept by the regulated person for four years after the date of
the transaction.
(b) Every record required to be kept subject to Section 1310.03 for
List II chemical shall be kept by the regulated [[Page 32461]] person
for two years after the date of the transaction.
* * * * *
(f) * * *
(1) List I Chemicals:
------------------------------------------------------------------------
Chemical Threshold by base weight
------------------------------------------------------------------------
(i) * * *............................
(xxii) Benzaldehyde.................. 4 Kilograms.
(xxiii) Nitroethane.................. 2.5 Kilograms.
------------------------------------------------------------------------
(2) List II chemicals:
(i) * * *
(iv) Exports, transshipments and international transactions to
Designated Countries set forth in Sec. 1310.08(b)
* * * * *
5. Section 1310.06 is amended by revising paragraphs (a)
introductory text, (a)(1), (c), and (d) to read as follows:
Sec. 1310.06 Content of records and reports.
(a) Each record required by Sec. 1310.03 shall include the
following:
(1) The name, address, and, if required, DEA registration number of
each party to the regulated transaction.
* * * * *
(c) Each report required by Section 1310.05(a) shall include the
information as specified by Section 1310.06(a) and, where obtainable,
the registration number of the other party, if such party is
registered. A report submitted pursuant to Sec. 1310.05(a)(1) or (a)(4)
must also include a description of the circumstances leading the
regulated person to make the report, such as the reason that the method
of payment was uncommon or the loss unusual. If the report is for a
loss or disappearance under Sec. 1310.05(a)(4), the circumstances of
such loss must be provided (in-transit, theft from premises, etc.)
(d) A suggested format for the reports is provided below:
Supplier:
Registration Number----------------------------------------------------
Name-------------------------------------------------------------------
Business Address-------------------------------------------------------
City-------------------------------------------------------------------
State------------------------------------------------------------------
Zip--------------------------------------------------------------------
Business Phone---------------------------------------------------------
Purchaser:
Registration Number----------------------------------------------------
Name-------------------------------------------------------------------
Business Address-------------------------------------------------------
City-------------------------------------------------------------------
State------------------------------------------------------------------
Zip--------------------------------------------------------------------
Business Phone---------------------------------------------------------
Identification---------------------------------------------------------
Shipping Address (if different than purchaser Address):
Street-----------------------------------------------------------------
City-------------------------------------------------------------------
State------------------------------------------------------------------
Zip--------------------------------------------------------------------
Date of Shipment-------------------------------------------------------
Name of Listed Chemical(s)---------------------------------------------
Quantity and Form of Packaging-----------------------------------------
Description of Machine:
Make-------------------------------------------------------------------
Model------------------------------------------------------------------
Serial #---------------------------------------------------------------
Method of Transfer-----------------------------------------------------
If Loss or Disappearance:
Date of Loss-----------------------------------------------------------
Type of Loss-----------------------------------------------------------
Description of Circumstances-------------------------------------------
Public reporting burden for this collection of information is estimated
to average ten minutes per response, including the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information. Send comments regarding this burden estimate
or any other aspect of this collection of information, including
suggestions for reducing this burden to the Drug Enforcement
Administration, Records Management Section, Washington, D.C. 20537; and
to the Office of Management and Budget, Paperwork Reduction Project No.
1117-0024, Washington, D.C. 20503.
* * * * *
6. Section 1310.07 is amended by revising paragraphs (a) and (b) to
read as follows:
Sec. 1310.07 Proof of identity.
(a) Each regulated person who engages in a regulated transaction
must identify the other party to the transaction. For domestic
transaction, this shall be accomplished by having the other party
present documents which would verify the identity, or registration
status if a registrant, of the other party to the regulated person at
the time the order is placed. For export transactions, this shall be
accomplished by good faith inquiry through reasonably available
research documents or publicly available information which would
indicate the existence of the foreign customer. No proof of identity is
required for foreign suppliers.
(b) The regulated person must verify the existence and apparent
validity of a business entity ordering a listed chemical, tableting
machine or encapsulating machine. For domestic transactions, this may
be accomplished by such methods as checking the telephone directory,
the local credit bureau, the local Chamber of Commerce or the local
Better Business Bureau, or, if the business entity is a registrant, by
verification of the registration. For export transactions, a good faith
inquiry to verify the existence and apparent validity of a foreign
business entity may be accomplished by such methods as verifying the
business telephone listing through international telephone information,
the firm's listing in international or foreign national chemical
directories or other commerce directories or trade publications,
confirmation through foreign subsidiaries of the U.S. regulated person,
verification through the country of destination's embassy Commercial
Attache, or official documents provided by the purchaser which confirm
the existence and apparent validity of the business entity.
* * * * *
7. Section 1310.08 is amended by revising paragraph (b)
introductory text to read as follows:
Sec. 1310.08 Excluded transactions.
* * * * *
(b) Exports, transshipments, and international transactions of
hydrochloric and sulfuric acids, except for exports, transshipments and
international transactions to the following countries:
* * * * *
8. Sections 1310.10 and 1310.11 are added to read as follows:
Sec. 1310.10 Removal of the exemption of drugs distributed under the
Food, Drug and Cosmetic Act.
(a) The Administrator may remove from exemption under
1310.01(f)(1)(iv) any drug or group of drugs that the Administrator
finds is being diverted to obtain a listed chemical for use in the
illicit production of a controlled substance. In removing a drug or
group of drugs from the exemption the Administrator shall consider:
(1) the scope, duration, and significance of the diversion;
(2) whether the drug or group of drugs is formulated in such a way
that it cannot be easily used in the illicit production of a controlled
substance; and
(3) whether the listed chemical can be readily recovered from the
drug or group of drugs.
(b) Upon determining that a drug or group of drugs should be
removed from the exemption under paragraph (a) of this section, the
Administrator shall issue and publish in the Federal Register his
proposal to remove the drug or group of drugs from the exemption, which
shall include a reference to the legal authority under which the
proposal is based. The Administrator shall permit any interested person
to file written comments on or objections to [[Page 32462]] the
proposal. After considering any comments or objections filed, the
Administrator shall publish in the Federal Register his final order.
(c) The Administrator shall limit the removal of a drug or group of
drugs from exemption under paragraph (a) of this section to the most
identifiable type of the drug or group of drugs for which evidence of
diversion exists unless there is evidence, based on the pattern of
diversion and other relevant factors, that the diversion will not be
limited to that particular drug or group of drugs.
(d) Any manufacturer seeking reinstatement of a particular drug
product that has been removed from an exemption under paragraph (a) of
this section, may apply to the Administrator for reinstatement of the
exemption for that particular drug product on the grounds that the
particular drug product is manufactured and distributed in a manner
that prevents diversion. In determining whether the exemption should be
reinstated the Administrator shall consider:
(1) the package sizes and manner of packaging of the drug product;
(2) the manner of distribution and advertising of the drug product;
(3) evidence of diversion of the drug product;
(4) any actions taken by the manufacturer to prevent diversion of
the drug product; and
(5) such other factors as are relevant to and consistent with the
public health and safety, including the factors described in paragraph
(a) of this section as applied to the drug product.
(e) Within a reasonable period of time after receipt of the
application for reinstatement of the exemption, the Administrator shall
notify the applicant of his acceptance or non-acceptance of his
application, and if not accepted, the reason therefor. If the
application is accepted for filing, the Administrator shall issue and
publish in the Federal Register his order on the reinstatement of the
exemption for the particular drug product, which shall include a
reference to the legal authority under which the order is based. This
order shall specify the date on which it shall take effect. The
Administrator shall permit any interested person to file written
comments on or objections to the order. If any such comments raise
significant issues regarding any finding of fact or conclusion of law
upon which the order is based, the Administrator shall immediately
suspend the effectiveness of the order until he may reconsider the
application in light of the comments and objections filed. Thereafter,
the Administrator shall reinstate, revoke, or amend his original order
as he determines appropriate.
(f) Unless the Administrator has evidence that the drug product is
being diverted, as determined by applying the factors set forth in
paragraph (a) of this section, and the Administrator so notifies the
applicant, transactions involving a specific drug product will not be
considered regulated transactions during the following periods:
(1) while a bonafide application for reinstatement of exemption
under paragraph (d) of this section for the specific drug product is
pending resolution, provided that the application for reinstatement is
filed not later than 60 days after the publication of the final order
removing the exemption; and
(2) for a period of 60 days following the Administrator's denial of
an application for reinstatement.
(g) An order published by the Administrator in the Federal
Register, pursuant to paragraph (e) of this section, to reinstate an
exemption may be modified or revoked with respect to a particular drug
product upon a finding that:
(1) applying the factors set forth in paragraph (a) of this section
to the particular drug product, the drug product is being diverted; or
(2) there is a significant change in the data that led to the
issuance of the final rule.
Sec. 1310.11 Reinstatement of exemption for drug products distributed
under the Food, Drug and Cosmetic Act.
(a) The Administrator has reinstated the exemption for the drug
products listed in paragraph (e) of this section from application of
sections 302, 303, 310, 1007, and 1008 of the Act (21 U.S.C. 822-823,
830, and 957-958), to the extent described in paragraphs (b), (c), and
(d) of this section.
(b) No reinstated exemption granted pursuant to 1310.10 affects the
criminal liability for illegal possession or distribution of listed
chemicals contained in the exempt drug product.
(c) Changes in exempt drug product compositions: Any change in the
quantitative or qualitative composition, trade name or other
designation of an exempt drug product listed in paragraph (d) requires
a new application for reinstatement of the exemption.
(d) The following drug products, in the form and quantity listed in
the application submitted (indicated as the ``date'') are designated as
reinstated exempt drug products for the purposes set forth in this
section:
Exempt Drug Products
------------------------------------------------------------------------
Supplier Product name Form Date
------------------------------------------------------------------------
[Reserved]....... ................. ................ ................
------------------------------------------------------------------------
9. Section 1310.14 and 1310.15. are added to read as follows:
Sec. 1310.14 Exemption of drug products containing ephedrine and
therapeutically significant quantities of another active medicinal
ingredient.
(a) Any manufacturer of a drug product containing ephedrine in
combination with another active medicinal ingredient, the product
formulation of which is not listed in the compendiums set forth in
section 1310.01(f)(1)(iv)(A), may request that the Administrator exempt
the product as one which contains ephedrine together with a
therapeutically significant quantity of another active medicinal
ingredient.
(b) An application for an exemption under this section shall
contain the following information:
(1) The name and address of the applicant;
(2) The exact trade name of the drug product for which exemption is
sought;
(3) The complete quantitative and qualitative composition of the
drug product;
(4) A brief statement of the facts which the applicant believes
justify the granting of an exemption under this section; and
(5) Certification by the applicant that the product may be lawfully
marketed or distributed under the Food, Drug, and Cosmetic Act.
(6) The identification of any information on the application which
is considered by the applicant to be a trade secret or confidential and
entitled to protection under U.S. laws restricting the public
disclosure of such information by government employees.
(c) The Administrator may require the applicant to submit such
additional documents or written statements of fact relevant to the
application which he deems necessary for determining if the application
should be granted.
(d) Within a reasonable period of time after the receipt of a
completed application for an exemption under this section, the
Administrator shall notify the applicant of acceptance or non-
acceptance of the application. If the application is not accepted, an
explanation will be provided. The Administrator is not required to
accept an application if any of the information required in paragraph
(b) of this section or requested pursuant to paragraph (c) of this
section is lacking or not readily [[Page 32463]] understood. The
applicant may, however, amend the application to meet the requirements
of paragraphs (b) and (c) of this section. If the application is
accepted for filing, the Administrator shall issue and publish in the
Federal Register an order on the application, which shall include a
reference to the legal authority under which the order is based. This
order shall specify the date on which it shall take effect. The
Administrator shall permit any interested person to file written
comments on or objections to the order. If any comments or objections
raise significant issues regarding any findings of fact or law upon
which the order is based, the Administrator shall immediately suspend
the effectiveness of the order until he may reconsider the application
in light of the comments and objections filed. Thereafter, the
Administrator shall reinstate, revoke, or amend the original order as
deemed appropriate.
Sec. 1310.15 Exempt drug products containing ephedrine and
therapeutically significant quantities of another active medicinal
ingredient.
(a) The drug products containing ephedrine and therapeutically
significant quantities of another active medicinal ingredient listed in
paragraph (e) of this section have been exempted by the Administrator
from application of sections 302, 303, 310, 1007, and 1008 of the Act
(21 U.S.C. 822-3, 830, and 957-8) to the extent described in paragraphs
(b), (c), and (d) of this section.
(b) No exemption granted pursuant to 1310.14 affects the criminal
liability for illegal possession or distribution of listed chemicals
contained in the exempt drug product.
(c) Changes in drug product compositions: Any change in the
quantitative or qualitative composition of an exempt drug product
listed in paragraph (d) requires a new application for exemption.
(d) In addition to the drug products listed in the compendium set
forth in Sec. 1310.01(f)(1)(iv)(A), the following drug products, in the
form and quantity listed in the application submitted (indicated as the
``date'') are designated as exempt drug products for the purposes set
forth in this section:
Exempt Drug Products Containing Ephedrine and Therapeutically
Significant Quantities of Another Active Medicinal Ingredient
------------------------------------------------------------------------
Supplier Product name Form Date
------------------------------------------------------------------------
[Reserved]....... ................. ................ ................
------------------------------------------------------------------------
PART 1313--[AMENDED]
1. The authority citation for part 1313 continues to read as
follows:
Authority: 21 U.S.C. 802, 830, 871(b), 971.
2. Section 1313.02 is amended by revising paragraphs (c), (d)
introductory text, (d)(1), (h) and (i); redesignating paragraph (m) as
paragraph (o) and adding new paragraphs (m) and (n) to read as follows:
Sec. 1313.02 Definitions.
* * * * *
(c) The term regulated person means any individual, corporation,
partnership, association, or other legal entity who manufactures,
distributes, imports, or exports a listed chemical, a tableting
machine, or an encapsulating machine, or who acts as a broker or trader
for an international transaction involving a listed chemical, a
tableting machine, or an encapsulating machine.
(d) The term regulated transaction means:
(1) A distribution, receipt, sale, importation, exportation, or
international transaction of a listed chemical, or if the Administrator
establishes a threshold amount for a specific listed chemical, a
threshold amount as determined by the Administrator, which includes a
cumulative threshold amount for multiple transactions, of a listed
chemical, except that such term does not include:
(i) A domestic lawful distribution in the usual course of business
between agents or employees of a single regulated person; in this
context, agents or employees means individuals under the direct
management and control of the regulated person;
(ii) A delivery of a listed chemical to or by a common or contract
carrier for carriage in the lawful and usual course of the business of
the common or contract carrier, or to or by a warehouseman for storage
in the lawful and usual course of the business of the warehouseman,
except that if the carriage or storage is in connection with the
distribution, importation, or exportation of a listed chemical to a
third person, this paragraph does not relieve a distributor, importer,
or exporter from compliance with this part or parts 1309 and 1310 of
this chapter;
(iii) Any category of transaction or any category of transaction
for a specific listed chemical or chemicals specified by regulation of
the Administrator as excluded from this definition as unnecessary for
enforcement of the Act;
(iv) Any transaction in a listed chemical that is contained in a
drug that may be marketed or distributed lawfully in the United States
under the Federal Food, Drug, and Cosmetic Act unless)--
(A) The drug contains ephedrine or its salts, optical isomers, or
salts of optical isomers as the only active medicinal ingredient or
contains ephedrine or its salts, optical isomers or salts of optical
isomers and therapeutically insignificant quantities of another active
medicinal ingredient (for purposes of this paragraph, the term
``therapeutically insignificant quantities'' shall apply if the product
formulation (i.e., the qualitative and quantitative composition of
active ingredients within the product) is not listed in American
Pharmaceutical Association (Apha) Handbook of Nonprescription Drugs;
Drug Facts and Comparisons (published by Wolters Kluwer Company); or
USP DI (published by authority of the United States Pharmacopeial
Convention, Inc.); or the product is not listed in Section 1310.15 as
an exempt drug product. For drug products having formulations not found
in the above compendiums, the Administrator shall determine, pursuant
to a written request as specified in Section 1310.14, whether the
active medicinal ingredients are present in quantities considered
therapeutically significant for purposes of this paragraph; or
(B) The Administrator has determined pursuant to the criteria in
Section 1310.10 that:
(1) The drug or group of drugs is being diverted to obtain the
listed chemical for use in the illicit production of a controlled
substance; and
(2) The quantity of ephedrine or other listed chemical contained in
the drug included in the transaction or multiple transactions equals or
exceeds the threshold established for that chemical by the
Administrator;
(v) Any transaction in a chemical mixture listed in Section
1310.13.
* * * * *
(h) The term regular importer means, with respect to a listed
chemical, a person that has an established record as an importer of
that listed chemical that is reported to the Administrator.
(i) The term established record as an importer means that the
regulated [[Page 32464]] person has imported a listed chemical at least
once within the past six months, or twice within the past twelve months
from a foreign supplier. The term also means that the regulated person
has provided the Administration with the following information in
accordance with the waiver of the 15-day advance notice requirements of
Section 1313.15:
(1) the name, DEA registration number (where applicable), street
address, telephone number, telex number, and, where available, the
facsimile number of the regulated person and of each foreign supplier;
and
(2) the frequency and number of transactions occurring during the
preceding 12-month period.
* * * * *
(m) The terms broker and trader mean any individual, corporation,
corporate division, partnership, association, or other legal entity
which assists in arranging an international transaction in a listed
chemical by--
(1) negotiating contracts;
(2) serving as an agent or intermediary; or
(3) fulfilling a formal obligation to complete the transaction by
bringing together a buyer and seller, a buyer and transporter, or a
seller and transporter, or by receiving any form of compensation for so
doing.
(n) The term international transaction means a transaction
involving the shipment of a listed chemical across an international
border (other than a United States border) in which a broker or trader
located in the United States participates.
* * * * *
3. Section 1313.12 is amended by revising paragraph (c) and adding
new paragraphs (d), (e) and (f) to read as follows:
Sec. 1313.12 Requirement of authorization to import.
* * * * *
(c) The 15-day advance notification requirement for listed chemical
imports may be waived for:
(1) Any regulated person who has satisfied the requirements for
reporting to the Administration as a regular importer of such listed
chemicals; or
(2) A specific listed chemical, as set forth in paragraph (f) of
this section, for which the Administrator determines that advance
notification is not necessary for effective chemical diversion control.
(d) For imports where advance notification is waived pursuant to
paragraph (c)(1) of this section, the DEA Form 486 must be received by
the Drug Enforcement Administration, Chemical Operations Section, on or
before the date of importation through use of the mailing address
listed in Sec. 1313.12(b) or through use of electronic facsimile media.
(e) For importations where advance notification is waived pursuant
to paragraph (c)(2) of this section no DEA Form 486 is required,
however, the regulated person shall submit quarterly reports to the
Drug Enforcement Administration, Chemical Operations Section, P.O. Box
28346, Washington, DC 20038, by no later than the 15th day of the month
following the end of each quarter. The report shall contain the
following information regarding each individual importation:
(1) The name of the listed chemical;
(2) The quantity and date imported;
(3) The name and full business address of the supplier;
(4) The foreign port of embarkation; and
(5) The port of entry.
(f) The 15 day advance notification requirement set forth in
paragraph (a) has been waived for imports of the following listed
chemicals:
(1) [Reserved]
4. Section 1313.15 is revised to read as follows:
Sec. 1313.15 Waiver of 15-day advance notice for regular importers.
(a) Each regulated person seeking designation as a ``regular
importer'' shall provide, by certified mail return receipt requested,
to the Administration such information as is required under
Sec. 1313.02(i), documenting their status as a regular importer.
(b) Each regulated person making application under paragraph (a) of
this section shall be considered a ``regular importer'' for purposes of
waiving the 15-day advance notice, 30 days after receipt of the
application by the Administration, as indicated on the return receipt,
unless the regulated person is otherwise notified in writing by the
Administration.
(c) The Administrator, may, at any time, disqualify a regulated
person's status as a regular importer on the grounds that the chemical
being imported may be diverted to the clandestine manufacture of a
controlled substance.
(d) Unless the Administration notifies the chemical importer to the
contrary, the qualification of a regular importer of any one of these
three chemicals, acetone, 2-Butanone (MEK), or toluene, qualifies that
importer as a regular importer of all three of these chemicals.
(e) All chemical importers shall be required to file a DEA Form 486
as required by Section 1313.12.
5. Section 1313.21 is amended by redesignating paragraph (d) as
paragraph (g) by revising paragraph (c) and newly designated paragraph
(g) and by adding new paragraphs (d), (e), and (f) to read as follows:
Sec. 1313.21 Requirement of authorization to export.
* * * * *
(c) The 15-day advance notification requirement for listed chemical
exports may be waived for:
(1) any regulated person who has satisfied the requirements of
Section 1313.24 for reporting to the Administration an established
business relationship with a foreign customer as defined in
Sec. 1313.02(j).
(2) A specific listed chemical to a specified country, as set forth
in paragraph (f) of this section, for which the Administrator
determines that advance notification is not necessary for effective
chemical diversion control.
(d) For exports where advance notification is waived pursuant to
paragraph (c)(1) of this section, the DEA Form 486 must be received by
the Drug Enforcement Administration, Chemical Operations Section, on or
before the date of exportation through use of the mailing address
listed in Section 1313.12(b) or through use of electronic facsimile
media.
(e) For exportations where advance notification is waived pursuant
to paragraph (c)(2) of this section, the regulated person shall file
quarterly reports to the Drug Enforcement Administration, Chemical
Operations Section, P.O. Box 28346, Washington, DC 20038, by no later
than the 15th day of the month following the end of each quarter. The
report shall contain the following information regarding each
individual importation:
(1) The name of the listed chemical;
(2) The quantity and date exported;
(3) The name and full business address of the foreign customer;
(4) The port of embarkation; and
(5) The foreign port of entry.
(f) The 15 day advance notification requirement set forth in
paragraph (a) of this section has been waived for exports of the
following listed chemicals to the following countries:
------------------------------------------------------------------------
Name of Chemical Country
------------------------------------------------------------------------
[Reserved]......................... ...................................
------------------------------------------------------------------------
(g) No person shall export or cause to be exported any listed
chemical, knowing or having reasonable cause to believe the export is
in violation of the laws of the country to which the chemical is
exported or the chemical will be used to manufacture a controlled
substance in violation of the Act or the [[Page 32465]] laws of the
country to which the chemical is exported. The Administration will
publish a notice of foreign import restrictions for listed chemicals of
which DEA has knowledge as provided in Sec. 1313.25.
6. A new undesignated center heading is added preceding
Sec. 1313.31 to read as follows:
Transshipments, In-Transit Shipments and International Transactions
Involving Listed Chemicals
7. Sections 1313.32, 1313.33, and 1313,34 are added to read as
follows:
1313.32 Requirement of authorization for international
transactions.
1313.33 Contents of an international transaction declaration.
1313.34 Distribution of the international transaction declaration.
Sec. 1312.32 Requirement of authorization for international
transactions.
(a) A broker or trader shall notify the Administrator prior to an
international transaction involving a listed chemical which meets or
exceeds the threshold amount identified in Section 1310.04 of this
chapter, in which the broker or trader participates. Notification must
be made no later than 15 days before the transaction is to take place.
In order to facilitate an international transaction involving listed
chemicals and implement the purpose of the Act, regulated persons may
wish to provide advance notification to the Administration as far in
advance of the 15 days as possible.
(b) (1) A completed DEA Form 486 must be received at the following
address not later than 15 days prior to the international transaction:
Drug Enforcement Administration, P.O. Box 28346, Washington,
D.C. 20038
(2) A copy of the DEA Form 486 may be transmitted directly to the
Drug Enforcement Administration, Chemical Operations Section, through
electronic facsimile media not later than 15 days prior to the
exportation.
(c) No person shall serve as a broker or trader for an
international transaction involving a listed chemical knowing or having
reasonable cause to believe that the transaction is in violation of the
laws of the country to which the chemical is exported or the chemical
will be used to manufacture a controlled substance in violation of the
laws of the country to which the chemical is exported. The
Administration will publish a notice of foreign import restrictions for
listed chemicals of which DEA has knowledge as provided in Section
1313.25.
Sec. 1313.33 Contents of an international transaction declaration.
(a) An international transaction involving a chemical listed in
Sec. 1310.02 of this chapter which meets the threshold criteria
established in Sec. 1310.04 of this chapter may be arranged by a broker
or trader if the chemical is needed for medical, commercial,
scientific, or other legitimate uses.
(b) Any broker or trader who desires to arrange an international
transaction involving a listed chemical which meets the criteria set
forth in Section 1310.04 shall notify the Administration through the
procedures outlined in Section 1313.32(b).
(c) The DEA Form 486 must be executed in triplicate and must
include all the following information:
(1) The name, address, telephone number, telex number, and, where
available, the facsimile number of the chemical exporter; the name,
address, telephone number, telex number, and, where available, the
facsimile number of the chemical importer;
(2) The name and description of each listed chemical as it appears
on the label or container, the name of each listed chemical as it is
designated in Section 1310.02 of this chapter, the size or weight of
container, the number of containers, the net weight of each listed
chemical given in kilograms or parts thereof, and the gross weight of
the shipment given in kilograms or parts thereof;
(3) The proposed export date, the port of exportation, and the port
of importation; and
(4) The name, address, telephone, telex, and where available, the
facsimile number, of the consignee in the country where the chemical
shipment is destined; the name(s) and address(es) of any intermediate
consignee(s).
Sec. 1313.34 Distribution of the international transaction
declaration.
The required three copies of the DEA Form 486 will be distributed
as follows:
(a) Copies 1 and 3 shall be retained on file by the broker or
trader as the official record of the international transaction.
Declaration forms involving List I chemicals shall be retained for List
II chemicals shall be retained for two years.
(b) Copy 2 is the Drug Enforcement Administration copy used to
fulfill the notification requirements of Section 1313.32.
* * * * *
7. In the heading of part 1313, the undesignated center heading
preceding section 1313.12, and the undesignated center heading
preceding section 1313.21 remove the words ``Precursors and Essential
Chemicals'' and add, in their place, the words ``Listed Chemicals'';
Sec. 1313.01 [Amended]
8. In Section 1313.01 remove the words ``precursors and essential
chemicals'' and add, in their place, the words ``listed chemicals'';
Sec. 1313.14 [Amended]
9. In Section 1313.14 introductory text, and in Section 1313.23
introductory text, remove the words ``precursor and essential
chemical'' and add, in their place, ``listed chemical''.
Sec. 1313.13 [Amended]
10. In Sections 1313.13(a) and 1313.22(a) DEA is removing the words
``precursor or essential chemical'' and adding, in their place, the
words ``List I or List II chemical''.
Sec. 1313.14 [Amended]
11. In Sections 1313.14(a) and 1313.23(a) DEA is removing the words
``listed precursor chemical'' and ``listed essential chemical'' and
adding, in their place, the words ``List I chemical'' and ``List II
chemical'' respectively.
PART 1316--[AMENDED]
1. The authority citation for part 1316 is amended to read as
follows:
Authority: 21 U.S.C. 822(f), 830(a), 871(b), 880, 958(f), 965.
2. Section 1316.02 is amended by revising paragraph (c)(2) to read
as follows:
Sec. 1316.02 Definitions.
* * * * *
(c) * * *
(2) Places, including factors, warehouses, or other establishments
and conveyances, where persons registered under the Act or exempted
from registration under the Act, or regulated persons may lawfully
hold, manufacture, or distribute, dispense, administer, or otherwise
dispose of controlled substances or listed chemicals or where records
relating to those activities are maintained.
* * * * *
3. Section 1316.03 is amended by revising paragraphs (b), (c), (d)
and (e) to read as follows:
Sec. 1316.03 Authority to make inspections.
* * * * *
(b) Inspecting within reasonable limits and to a reasonable manner
all pertinent equipment, finished and unfinished controlled substances,
listed chemicals, and other substances or materials, containers, and
labeling [[Page 32466]] found at the controlled premises relating to
this Act;
(c) Making a physical inventory of all controlled substances and
listed chemicals on-hand at the premises;
(d) Collecting samples of controlled substances or listed chemicals
(in the event any samples are collected during an inspection, the
inspector shall issue a receipt for such samples on DEA Form 84 to the
owner, operator, or agent in charge of the premises);
(e) Checking of records and information on distribution of
controlled substances or listed chemicals by the registrant or
regulated person (i.e., has the distribution of controlled substances
or listed chemicals increased markedly within the past year, and if so
why);
* * * * *
4. Section 1316.09 is amended by revising paragraph (a)(3) to read
as follows:
Sec. 1316.09 Application for administrative inspection warrant.
(a) * * *
(3) A statement relating to the nature and extent of the
administrative inspection, including, where necessary, a request to
seize specified items and/or to collect samples of finished or
unfinished controlled substances or listed chemicals;
* * * * *
Dated: May 1, 1995.
Stephen H. Greene,
Deputy Administrator, Drug Enforcement Administration.
[FR Doc. 95-14978 Filed 6-21-95; 8:45 am]
BILLING CODE 4410-09-M
