[Federal Register Volume 59, Number 117 (Monday, June 20, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-14871]
[[Page Unknown]]
[Federal Register: June 20, 1994]
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DEPARTMENT OF TRANSPORTATION
Coast Guard
46 CFR Part 67
[CGD 94-008]
RIN 2115-AE83
Documentation of Vessels
AGENCY: Coast Guard, DOT.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Coast Guard proposes to amend its vessel documentation
regulations. The proposed amendments would clarify the vessel
documentation regulations by restating the citizenship requirements for
trusts to reflect the Coast Guard's policy; by correcting an existing
cross-reference error regarding mortgagee consent for exchange of
Certificates of Documentation; by implementing statutory requirements
concerning the endorsements on Certificates of Documentation for
dredges and towing vessels; and by making other minor technical
amendments.
DATES: Comments must be received on or before August 19, 1994.
ADDRESSES: Comments may be mailed to the Executive Secretary, Marine
Safety Council (G-LRA/3406) (CGD 94-008), U.S. Coast Guard
Headquarters, 2100 Second Street SW., Washington, DC 20593-0001, or may
be delivered to room 3406 at the same address between 8 a.m. and 3
p.m., Monday through Friday, except Federal holidays. The telephone
number is (202) 267-1477.
The Executive Secretary maintains the public docket for this
rulemaking. Comments will become part of this docket and will be
available for inspection or copying at room 3406, U.S. Coast Guard
Headquarters, between 8 a.m. and 3 p.m., Monday through Friday, except
Federal holidays.
FOR FURTHER INFORMATION CONTACT:
Lieutenant Commander Don M. Wrye, Vessel Documentation and Tonnage
Survey Branch, Merchant Vessel Inspection and Documentation Division,
Office of Marine Safety, Security and Environmental Protection; (202)
267-1492.
SUPPLEMENTARY INFORMATION:
Request for Comments
The Coast Guard encourages interested persons to participate in
this rulemaking by submitting written data, views, or arguments.
Persons submitting comments should include their names and addresses,
identify this rulemaking (CGD 94-008) and the specific section of this
proposal to which each comment applies, and give the reason for each
comment. Please submit two copies of all comments and attachments in an
unbound format, no larger than 8\1/2\ by 11 inches, suitable for
copying and electronic filing. Persons wanting acknowledgment of
receipt of comments should enclose stamped, self-addressed postcards or
envelopes.
The Coast Guard will consider all comments received during the
comment period. It may change this proposal in view of the comments.
The Coast Guard plans no public hearing. Persons may request a
public hearing by writing to the Marine Safety Council at the address
under ADDRESSES. The request should include the reasons why a hearing
would be beneficial. If it determines that the opportunity for oral
presentations will aid this rulemaking, the Coast Guard will hold a
public hearing at a time and place announced by a later notice in the
Federal Register.
Drafting Information
The principal person involved in drafting this document are
Lieutenant Commander Don M. Wrye, Project Manager, and C.G. Green,
Project Counsel, Office of Chief Counsel.
Background and Purpose
On November 15, 1993, the Coast Guard published a final rule in the
Federal Register (58 FR 60256) which revised 46 CFR Part 67 to
implement a number of statutory initiatives to simplify and streamline
the documentation process, to implement user fees for vessel
documentation services, and to clarify the regulations and present them
in a more orderly fashion. The final rule was the subject to two
correction documents which appeared in the Federal Register on December
13, 1993, at 58 FR 65130 and 58 FR 65243. The final rule became
effective on January 1, 1994. This rulemaking, among other things,
corrects certain errors and omissions in the final rule. It also
clarifies the citizenship requirements for a trust arrangement as a
vessel-owning entity, and states the endorsements required for dredges
and towing vessels.
On June 7, 1998 Congress amended 46 U.S.C. app. Sec. 316 (Pub. L.
100-329) to require towing vessels to be documented with a coastwise or
Great Lakes endorsement, as appropriate. On November 4, 1992, Congress
amended 46 U.S.C. app. Sec. 292 (Pub. L. 102-587) to require vessels of
at least five net tons engaged in dredging in the navigable waters of
the United States to be documented with a coastwise endorsement.
Neither of these statutory requirements were included in the revision
of Part 67. In order to state those requirements and to clarify the
endorsement requirements for vessels employed in towing or dredging,
the regulations need to be amended. This rulemaking proposes that
amendment.
Discussion of Proposed Amendments
The Coast Guard proposes to revise paragraphs (a) and (b) of
Sec. 67.19, which respectively describe a coastwide and Great Lakes
endorsement, by adding the words ``, dredging, towing,'' in paragraph
(a), and adding the words ``, towing in the Great Lakes,'' in paragraph
(b). The revision to paragraph (a) reflects the requirement expressed
in 46 U.S.C. app. Sec. 292 that vessels engaged in dredging in the
navigable waters of the United States be documented with a coastwise
endorsement. The revision to paragraph (b) reflects the requirement
expressed in 46 U.S.C. app. Sec. 316 that vessels engaged in towing,
other than in circumstances of distress, in waters subject to the
jurisdiction of the United States be documented with an appropriate
coastwide or Great Lakes endorsement.
The Coast Guard proposes to revise several sections regarding
citizenship requirements for vessel documentation. These revisions
would reorder and set out the citizenship requirements for a
partnership in a separate section; describe the citizenship
requirements for a trust in detail to specify the requirements for each
endorsement; set out the citizenship requirements for an association or
joint venture in a separate section; and reorder the citizenship
requirements for a corporation. None of the current citizenship
requirements for these entities would be changed by the revisions.
The proposed revision to Sec. 67.35 would set out the citizenship
requirements for a partnership in a separate section and in a more
logical order. Currently, Sec. 67.35 sets out the citizenship
requirements for a partnership, association, or joint venture together.
The partnership is frequently used as a vessel-owning business entity
for documentation purposes and has citizenship requirements quite
different from those of an association or joint venture. On the other
hand, the citizenship requirements for an association or joint venture
as a vessel-owning business entity for documentation purposes are the
same. Setting forth the citizenship requirements for a partnership in a
separate section would present them in a more appropriate format. None
of the current citizenship requirements for a partnership would be
changed.
Section 67.37, which sets forth the citizenship requirements for
trust arrangements as vessel-owning entities, would be redesignated as
Sec. 67.36. In addition, the citizenship requirements for trust
arrangements would be described in detail, like those for corporations
and partnerships, to specify the requirements for the relevant
endorsements. Paragraph (a) of proposed Sec. 67.36 would set forth the
general requirements for a registry or recreational endorsement that
each trustee and each beneficiary with an enforceable interest in the
trust be citizens. This paragraph would simply restate the current
regulatory requirements for trusts found in Sec. 67.37. Paragraphs (b)
and (c) of proposed Sec. 67.36 would set forth the citizenship
requirements for a fishery endorsement and a coastwise or Great Lakes
endorsement, respectively. These requirements would reflect the
statutory citizenship requirements for these endorsements applicable to
any business entity owning a documented vessel. The owner citizenship
requirements for a coastwise or Great Lakes endorsement may be found in
Sec. 2 of the Shipping act, 1916 (46 U.S.C. app. Sec. 802) and 46
U.S.C. 12107, respectively, and the owner citizenship requirements for
a fishery endorsement may be found in 46 U.S.C. 12108. The proposed
regulatory requirements would reflect the Coast Guard's policy in
enforcement of the statutory requirements. None of the current
citizenship requirements for trusts would be changed.
The proposed addition of a new Sec. 67.37 would set out the
citizenship requirements for associations and joint ventures as vessel-
owning entities for documentation purposes. The citizenship
requirements for associations and joint ventures are currently stated
in Sec. 67.35 with those for partnerships. However, there is no logical
reason to continue this grouping. Separating the requirements for
associations and joint ventures, which are identical, from those for
partnerships would present the information in a more logical and
orderly fashion. None of the current citizenship requirements for
associations or joint ventures would be changed.
The proposed revision to paragraphs (b), (c), and (d) of Sec. 67.39
would clarify the current regulations by rearranging the citizenship
requirements for corporations in a more logical order. None of the
current citizenship requirements for corporations would be changed.
The proposed revision to paragraph (e) of Sec. 67.119 would clarify
the current regulations. Paragraph (e) of Sec. 67.119 was intended to
serve as a savings or ``grandfather'' provision with regard to hailing
port requirements for vessels issued a Certificate of Documentation
prior to July 1, 1982. The language of the final rule implies that the
provisions of the entire section do not apply to the identified
vessels, rather than only the provisions of paragraph (c). This
revision will remove the confusion that currently exists because of the
omission from the final rule. The proposed revision would clearly state
that only the requirements of paragraph (c) of Sec. 67.119,
specifically that a hailing port include a State, territory, or
possession designation, do not apply to vessels issued a Certificate of
Documentation before July 1, 1982, until:
a. a port of record assignment is required under the regulations,
or
b. the owner elects to designate a new hailing port. Therefore,
vessels to which Sec. 67.119(c) do not apply can display a hailing port
consisting of the name of a city only until either of the conditions
described are met.
The proposed amendment to Sec. 67.145 would correct the cross-
reference to appropriate paragraphs in Sec. 67.167 where mortgagee
consent is required to exchange a Certificate of Documentation. The
current regulation cites, in part, to paragraph (a) of Sec. 67.167,
which is incorrect since that paragraph contains only procedural
information and refers to the remaining paragraphs of that section.
This cross-reference error has led to confusion, causing some
documentation officers to conclude that mortgagee consent is required
for any cause of exchange listed in Sec. 67.167. The reasons requiring
mortgagee consent contained in the paragraphs referenced in the amended
language are those for which consent has been traditionally required.
The proposed revision to paragraph (d) of Sec. 67.171 would clarify
that the request for a certificate evidencing deletion from
documentation must be made to the vessel's port of record. Since the
port of record is the custodian of the vessel's file, only that port
should issue a deletion certificate.
The proposed revision to Sec. 67.321 would clarify that when the
address of the managing owner of a vessel changes, the managing owner
must report that change to the documentation officer at the vessel's
port of record within 10 days of its occurrence. This revision would
conform Sec. 67.321 to a similar requirement in Sec. 67.113. Unreported
changes of address have proved to be a particularly bothersome problem.
If changes of address for the managing owner are not reported, the
Coast Guard may send the renewal notice to the wrong address which can
lead to late renewal or a failure to renew with civil penalty action.
The proposed revision would clarify the responsibility of the managing
owner to provide proper notice of changes of address.
The proposed revision to Sec. 67.539, adding the words ``or
document'', would clarify that the fee is charged for a copy of any
instrument or document for which a specific fee is not listed. Also,
the revision would clarify that the cross-reference to 49 CFR 7.95 is
solely for the purpose of calculating the fee in the same manner as
described in that section. It does not mean that a request for a copy
of any instrument or document not specifically identified in Subpart Y
of Part 67 is to be processed as a request pursuant to the Freedom of
Information Act. Therefore, once the fee for the copy has been
calculated in the manner described in 49 CFR 7.95, it is incorrect to
refer to any other section in 49 CFR Part 7 for any purpose with regard
to the fee.
Regulatory Evaluation
This proposal is not a significant regulatory action under section
3(f) of Executive Order 12866 and does not require an assessment of
potential costs and benefits under section 6(a)(3) of that order. It
has not been reviewed by the Office of Management and Budget under that
order. It is not significant under the regulatory policies and
procedures of the Department of Transportation (DOT) (44 FR 11040;
February 26, 1979).
The Coast Guard expects the economic impact of this proposal to be
so minimal that a full Regulatory Evaluation under paragraph 10e of the
regulatory policies and procedures of DOT is unnecessary. As discussed
earlier in this preamble, this proposal, if adopted, would clarify the
citizenship requirements of a trust as a vessel-owning entity, correct
certain errors and omissions made in the final rule for 46 CFR part 67,
clarify a cross-reference with regard to calculation of fees for copies
of instruments and documents, and address the statutorily required
endorsements for vessels employed in towing and dredging. These matters
are administrative in nature and do not have any economic impacts on
the regulated public.
Small Entities
Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the
coast Guard must consider whether this proposal, if adopted, will have
a significant economic impact on a substantial number of small
entities. ``Small entities'' may include (1) small businesses and not-
for-profit organizations that are independently owned and operated and
are not dominant in their fields and (2) governmental jurisdictions
with populations of less than 50,000.
The Coast Guard expects the impact of this proposal to be minimal
because it would only clarify the structure of a trust as a vessel-
owning entity, correct certain errors and omissions made in the final
rule for 46 CFR part 67, clarify a cross-reference with regard to
calculation of fees for copies of instruments and documents, and
address the statutorily required endorsements for vessels employed in
towing or dredging. This proposal would bring the regulations into
conformity with current policy and practice. These matters are
administrative in nature and do not have any economic impacts on the
regulated public. Because it expects the impact of this proposal to be
minimal, the Coast Guard certifies under 5 U.S.C. 605(b) that this
proposal, if adopted, will not have a significant economic impact on a
substantial number of small entities.
Collection of Information
This proposal contains no collection-of-information requirements
under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.).
Federalism
The Coast Guard has analyzed this proposal under the principles and
criteria contained in Executive Order 12612 and has determined that
this proposal does not have sufficient federalism implications to
warrant the preparation of a Federalism Assessment.
Environment
The coast guard considered the environmental impact of this
proposal and concluded that under section 2.B.2. of Commandant
Instruction M16475.1B, this proposal is categorically excluded from
further environmental documentation. This proposal has been determined
to be categorically excluded because the changes proposed are
administrative in nature and clearly have no environmental impact. A
``Categorical Exclusion Determination'' is available in the docket for
inspection or copying where indicated under ADDRESSES.
List of Subjects in 46 CFR Part 67
Fees, Incorporation by reference, Vessels.
For the reasons set out in the preamble, the Coast Guard proposes
to amend 46 CFR part 67 as follows:
PART 67--[AMENDED]
1. The authority citation for part 67 is revised to read as
follows:
Authority: 14 U.S.C. 664; 31 U.S.C. 9701; 42 U.S.C. 9118; 46
U.S.C. 2103, 2107, 2110; 46 U.S.C. app. 841a, 876; 49 CFR 1.46.
2. In Sec. 67.19, paragraphs (a) and (b) are revised to read as
follows:
Sec. 67.19 Coastwise or Great Lakes endorsement.
(a) A coastwise endorsement entitles a vessel to employment in
unrestricted coastwise trade, dredging, towing, and any other
employment for which a registry, fishery, or Great Lakes endorsement is
not required.
(b) A Great lakes endorsement entitles a vessel to employment in
the Great Lakes trade, towing in the Great Lakes, and any other
employment for which a registry, fishery, or coastwise endorsement is
not required.
* * * * *
3. Section 67.35 is revised to read as follows:
Sec. 67.35 Partnership.
A partnership is a citizen if all its general partners are
citizens, and:
(a) For the purpose of obtaining a registry or recreational
endorsement, at least 50 percent of the equity interest in the
partnership is owned by citizens.
(b) For the purpose of obtaining a fishery endorsement, more than
50 percent of the equity interest in the partnership is owned by
citizens.
(c) For the purpose of obtaining a coastwise or Great Lakes
endorsement or both, at least 75 percent of the equity interest in the
partnership is owned by citizens.
4. Section 67.37 is redesignated as Sec. 67.36 and revised to read
as follows:
Sec. 67.36 Trust.
(a) For the purpose of obtaining a registry or recreational
endorsement, a trust arrangement is a citizen if:
(1) Each of its trustees is a citizen; and
(2) Each beneficiary with an enforceable interest in the trust is a
citizen.
(b) For the purpose of obtaining a fishery endorsement, a trust
arrangement is a citizen if:
(1) It meets all the requirements of paragraph (a) of this section;
and
(2) More than 50 percent of the equity interest in the trust is
owned by citizens.
(c) For the purpose of obtaining a coastwise or Great Lakes
endorsement or both, a trust arrangement is a citizen if:
(1) It meets all the requirements of paragraph (a) of this section;
and
(2) At least 75 percent of the equity interest in the trust is
owned by citizens.
5. Section 67.37 is added to read as follows:
Sec. 67.37 Association or joint venture.
(a) An association is a citizen if each of its members is a
citizen.
(b) A joint venture is a citizen if each of its members is a
citizen.
6. In Sec. 67.39, paragraphs (b), (c), and (d) are revised to read
as follows:
Sec. 67.39 Corporation.
* * * * *
(b) for the purpose of obtaining a fishery endorsement, a
corporation is a citizen if:
(1) It meets all the requirements of paragraph (a) of this section;
and
(2) More than 50 percent of the stock interest in the corporation
including a majority of voting shares in the corporation is owned by
citizens.
(c) For the purpose of obtaining a coastwise or Great Lakes
endorsement or both, a corporation is a citizen if:
(1) It meets all the requirements of paragraph (a) of this section;
and
(2) At least 75 percent of the stock interest in the corporation is
owned by citizens.
(d) A corporation which does not meet the stock interest
requirement of paragraph (c) of this section may qualify for limited
coastwise trading privileges by meeting the requirements of part 68 of
this chapter.
7. In Sec. 67.119, paragraph (e) is revised to read as follows:
Sec. 67.119 Hailing port designation.
* * * * *
(e) Until such time as a port of record assignment is required in
accordance with Sec. 67.115, or the owner elects to designate a new
hailing port, the provisions of paragraph (c) of this section do not
apply to vessels which were issued a Certificate of Documentation
before July 1, 1982.
8. In Sec. 67.145, paragraph (a) is amended by removing the cross-
reference to ``Secs. 67,167(a) or 67.167(b) (1) through (6)'' and
adding, in its place, ``Secs. 67.167(b) (1) through (6) or 67.167(c)
(1) through (8)''.
9. In Sec. 67.171, paragraph (d) is revised to read as follows:
Sec. 67.171 Deletion; requirement and procedure.
* * * * *
(d) A certificate evidencing deletion from U.S. documentation will
be issued upon request of the vessel owner to the vessel's port of
record upon compliance with the applicable requirements of this
subpart.
10. Section 67.321 is revised to read as follows:
Sec. 67.321 Requirement to report change of address of managing owner.
Upon the change of address of the managing owner of a documented
vessel, the managing owner shall report the change of address to the
documentation officer at the port of record of the vessel within 10
days of its occurrence.
11. Section 67.539 is revised to read as follows:
Sec. 67.539 Copies of instruments and documents.
The fee charged for furnishing a copy of any instrument or document
is calculated in the same manner as described in 49 CFR 7.95.
Dated: June 10, 1994.
J.F. McGowan,
Captain, U.S. Coast Guard, Acting Chief, Office of Marine Safety,
Security and Environmental Protection.
[FR Doc. 94-14871 Filed 6-17-94; 8:45 am]
BILLING CODE 4910-14-M
