03-15640. Country of Origin Codes and Revision of Regulations on Hull Identification Numbers

AGENCY:

Coast Guard, DHS.

ACTION:

Notice of proposed rulemaking.

SUMMARY:

The Coast Guard proposes to allow U.S. manufacturers of recreational boats to display a 2-character, country of origin code before the 12-character Hull Identification Number (HIN) without separating the 2-character code by means of borders or on a separate label as is currently required by the HIN regulations. The current prohibition adversely affects U.S. manufacturers who seek to export some of their recreational boats. The removal of the current restriction would allow U.S. manufacturers to comply with the International Organization for Standardization (ISO) HIN standard, without changing the information collected by States on undocumented vessels they register.

DATES:

Comments and related material must reach the Docket Management Facility on or before September 18, 2003.

ADDRESSES:

You may submit comments identified by the Coast Guard docket number USCG-2003-14272 to the Docket Management Facility at the U.S. Department of Transportation. To avoid duplication, please use only one of the following methods:

(1) Web site: http://dms.dot.gov.

(2) Mail: Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street SW., Washington, DC 20590-0001.

(3) Fax: [phone].

(4) Delivery: Room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-366-9329.

(5) Federal Rulemaking Portal:http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT:

If you have questions on this proposed rule, call Mr. Alston Colihan, Office of Boating Safety, Coast Guard, telephone [phone]. If you have questions on viewing or submitting material to the docket, call Ms. Dorothy Beard, Chief, Dockets, Department of Transportation, telephone [phone].

SUPPLEMENTARY INFORMATION:

Public Participation and Access to Comments

We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted, without change, to http://dms.dot.gov and will include any personal information you have provided. We have an agreement with the Department of Transportation (DOT) to use the Docket Management Facility. Please see the “Privacy Act” paragraph below.

Submitting comments. If you submit a comment, please include your name and address, identify the docket number for this rulemaking (USCG-2003-14272), indicate the specific section of this document to which each comment applies, and give the reason for each comment. You may submit your comments and material by electronic means, mail, fax, or delivery to the Docket Management Facility at the address under ADDRESSES; but please submit your comments and material by only one means. If you submit them by mail or delivery, submit them in an unbound format, no larger than 81/2 by 11 inches, suitable for copying and electronic filing. If you submit them by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them.

Viewing comments and documents: To view comments, as well as documents mentioned in this preamble as being available in the docket, go to http://dms.dot.gov at any time and conduct a simple search using the docket number. You may also visit the Docket Management Facility in room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

Privacy Act. Anyone can search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the Department of Transportation's Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477), or you may visit http://dms.dot.gov.

Public Meeting

We do not now plan to hold a public meeting. But you may submit a request for one to the Docket Management Facility at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the Federal Register.

Background and Purpose

In 1995, the International Organization for Standardization (ISO) issued a Hull Identification Number standard (ISO 10087:1995(E)) consisting of the same format as the existing Coast Guard 12-character HIN (manufacturer's identification, serial number, month of manufacture, year of manufacture, and model year) preceded by a 2-character country code and a hyphen. Under the ISO HIN standard, a boat made in the U.S. for export to a foreign country would bear a HIN such as: US-ABC12345G303.

Boat manufacturers in the United States that export to Europe started using the ISO HIN standard beginning with the 1996 model year. According to ISO 10087:1995(E), paragraph (4), Composition of HIN, “A HIN shall consist of 14 consecutive characters plus a hyphen * * *.” But our regulation for displaying information near the HIN, 33 CFR 181.27, states, “If additional information is displayed on the boat within two inches of the hull identification number, that information must be separated from the hull identification number by means of borders or must be on a separate label so that it will not be interpreted as part of the hull identification number.” While the ISO HIN standard includes a paragraph with language that is nearly identical to § 181.27, these ISO requirements do not apply to the country code and hyphen, which precede our 12-character HIN.

The American Boat and Yacht Council (ABYC) develops voluntary consensus safety standards for the design, construction, equipage, maintenance, and repair of small craft. An ABYC Technical Committee studying the ISO HIN standard and our HIN standard concluded that the differing requirements create a problem for U.S. builders exporting to Europe. One large U.S. manufacturer that exports to Europe pointed out that use of a separate tape to create the border required by our HIN standard often results in misalignment and other flaws that may be confused with attempts to alter an HIN. This proposal was discussed at the October 29, 2001 meeting of the National Boating Safety Advisory Council and there were no objections by State Boating Law Administrators in attendance at the meeting. (66 FR 49445, September 27, 2001). The NBSAC unanimously passed a resolution requesting the Coast Guard to immediately pursue rulemaking for an exception to current regulations to allow the USA HIN system to conform to the ISO HIN standard while still allowing the states to not require the “Country Code” in their registration process.

Discussion of Proposed Rule

This rule would relieve manufacturers of recreational boats who sell both internationally and domestically of the burden of separating the country of origin code for the United States, “US-”, from the other 12 characters in a HIN by means of borders or a separate label. Any other information would still have to be separated from characters in the HIN by means of borders or a separate label.

Regulatory Evaluation

This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS).

We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. Allowing manufacturers to separate the Country of Origin Code without the use of borders or a separate label would relieve a burden and thereby reduce the costs of complying with the HIN display requirement.

Small Entities

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

The Small Business Administration (SBA) has set up size standards for each SIC code based on the number of employees or annual receipts. The only type of small entity that this rule would affect would be small businesses. There were 4,420 U.S. manufacturers of recreational boats in 2002, an estimated 80 percent of which qualify as small businesses by the size standards of the SBA. However, we have observed that the businesses we have identified as small do not manufacture as many boats as their larger competitors. In addition, most of the businesses we have identified as small do not export to the European market and therefore would not follow the ISO HIN format.

Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment to the Docket Management Facility at the address under ADDRESSES. In your comment, explain why you think it qualifies and how and to what degree this rule would economically affect it.

Assistance for Small Entities

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effect on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact Mr. Alston Colihan, Project Manager, Office of Boating Safety, by telephone at [phone] or by e-mail at [e-mail].

Collection of Information

This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

Federalism

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism.

Unfunded Mandates Reform Act

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

Taking of Private Property

This proposed rule would not affect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

Civil Justice Reform

This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

Protection of Children

We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children.

Indian Tribal Governments

This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

Energy Effects

We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

Environment

We have analyzed this proposed rule under Commandant Instruction M16475.lD, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(a) of the Instruction, from further environmental documentation. The proposed rule to remove the requirement to separate the 2-character country of origin code from the 12-character HIN by means of borders or on a separate label relates to the documentation of vessels and is not expected to have any environmental impact.

A draft “Environmental Analysis Check List” and a draft “Categorical Exclusion Determination” are available in the docket where indicated under ADDRESSES. Comments on this section will be considered before we make the final decision on whether the rule should be categorically excluded from further environmental review.

List of Subjects in 33 CFR Part 181

• Labeling
• Marine safety
• Reporting and recordkeeping requirements

For the reasons set out in the preamble, the Coast Guard proposes to amend 33 CFR part 181 as follows:

PART 181—MANUFACTURER REQUIREMENTS

1. The authority citation for part 181 is revised to read as follows:

Authority: 46 U.S.C. 4302 and 4310; Pub. L. 103-206, 107 Stat. 2439; Department of Homeland Security Delegation No. 0170.

2. Revise § 181.27 to read as follows:

§ 181.27

Information displayed near hull identification number.

With the exception of the characters “US-”, which constitute the country of origin code for the United States, if information is displayed on the boat within 2 inches of the hull identification number (HIN), that information must be separated from the HIN by means of borders or must be on a separate label, so that it will not be interpreted as part of the hull identification number.

Dated: June 12, 2003.

David S. Belz,

Rear Admiral, U.S. Coast Guard, Director of Operations.