Magnuson-Stevens Fishery Conservation and Management Act Provisions; Fisheries of the Northeastern United States; Northeast Groundfish Fishery; Amendment 18, 18706-18716 [2017-08035]

Download as PDF 18706 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations Regional Fisheries Office (address above) or the Office of Management and Budget by email OIRA_Submission@ omb.eop.gov, or fax to (202) 395–7285. FOR FURTHER INFORMATION CONTACT: William Whitmore, Fishery Policy Analyst, phone: 978–281–9182; email: William.Whitmore@noaa.gov. SUPPLEMENTARY INFORMATION: DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 648 [Docket No. 150630567–7360–02] RIN 0648–BF26 Magnuson-Stevens Fishery Conservation and Management Act Provisions; Fisheries of the Northeastern United States; Northeast Groundfish Fishery; Amendment 18 National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Final rule. AGENCY: This final rule implements Amendment 18 to the Northeast Multispecies Fishery Management Plan. The New England Fishery Management Council developed Amendment 18 to promote fleet diversity and in the groundfish fishery, prevent the acquisition of excessive shares of permits, and enhance sector management. This action limits the number of permits and annual groundfish allocation that an entity can hold. This action also removes several effort restrictions to increase operational flexibility for fishermen on limited access handgear vessels. DATES: This rule is effective May 22, 2017, except for the amendments to §§ 648.82(b) and 648.87(c), which will be effective on May 1, 2017. ADDRESSES: Copies of Amendment 18, including the Environmental Impact Statement, the Regulatory Impact Review, and the Initial Regulatory Flexibility Analysis prepared in support of the proposed rule are available from Thomas A. Nies, Executive Director, New England Fishery Management Council, 50 Water Street, Mill 2, Newburyport, MA 01950. The supporting documents are also accessible via the Internet at: http:// www.nefmc.org/management-plans/ northeast-multispecies or http:// www.greateratlantic.fisheries.noaa.gov/ sustainable/species/multispecies. A copy of the record of decision for the Final Environmental Impact Statement can be obtained from the NOAA Fisheries Greater Atlantic Regional Fisheries Office, 55 Great Republic Drive, Gloucester, MA 01930. Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in this final rule may be submitted to the Greater Atlantic nlaroche on DSK30NT082PROD with RULES SUMMARY: VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 Background This action approves and implements the management measures in Amendment 18 to the Northeast (NE) Multispecies Fishery Management Plan (FMP). The measures for this action were explained in a notice of availability published on December 6, 2016 (81 FR 87862), and a proposed rule that published on December 20, 2016 (81 FR 92761). NMFS approved Amendment 18 on March 6, 2017. Summary of Approved Measures 1. Accumulation Limits Accumulation Limit Guidelines Amendment 18 includes several general measures detailing how permit accumulation limits are applied. • Accumulation limits apply to individuals, permit banks, and other entities, including groundfish sectors, at the individual permit and potential sector contribution (PSC) level. • Accumulation limits do not apply to the amount of annual groundfish allocated to a sector, technically referred to as a sector’s annual catch entitlement, or ACE. • Accumulation limits may be modified in a future framework due to changes from a Federal permit buyback or buyout. • If an entity held permits or PSC on the control date (April 7, 2011) that exceed the accumulation limits, it is exempt from the accumulation limit, but is restricted to holding no more permits or PSC than it held as of the control date. The grandfathered holdings may be fished or leased by the entity but are not transferrable. Current analyses show that no entity exceeds the control date accumulation limits. • There is no calculation of partial ownership when considering accumulation limits. Any entity that is a partial owner is assumed to have fullownership when calculating permit and PSC accumulation limits. Excessive Shares This action imposes accumulation limits to prevent the acquisition of excessive shares. For Amendment 18 analyses purposes, an excessive share of fishing privileges was interpreted as a share of PSC that would allow an entity PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 to influence the market to its advantage (i.e., exert market power). Based on this analysis, it was determined that no entity currently holds excessive shares. Also, analysis showed that the accumulation limits and the associated measures established in this action should sufficiently prevent an entity from acquiring an excessive share of fishing permits and exerting market power over the fishery. The limits were also designed, though, to avoid placing adverse impacts on fishing entities that would reduce operational flexibility and market efficiency. Limiting the Number of Permits This action limits an entity to holding no more than 5 percent of all limited access groundfish permits. An entity is prohibited from acquiring a permit that would result in it exceeding the 5percent permit cap. As of February 21, 2017, there were 1,335 limited access permits in the fishery; a 5-percent cap would limit an entity to 67 permits. The most permits held by any entity was 50. Based on this information, this permit cap is unlikely to immediately restrict any entity. Limiting the Potential Sector Contribution This action also limits an entity to holding no more than an aggregated average of all allocated groundfish stocks to 15.5 PSC. With 15 groundfish stocks currently allocated to the fishery, the total PSC across all stocks used by an individual or an entity can be no more than 232.5 (an average PSC of 15.5 percent per stock multiplied by 15 stocks). This allows an entity to hold PSC for a single stock in excess of 15.5 percent, so long as the total holdings used do not exceed 232.5. If the number of allocated groundfish stocks increases or decreases in the future, then this aggregate number (232.5) would increase or decrease by 15.5 per stock. As of February 21, 2017, no entity holds more than 141 PSC. Based on this information, the PSC limit is unlikely to immediately restrict any entity. Compared to other PSC limits that the Council considered, this option is the least restrictive because there is no stock-specific limit. Further, an entity would be permitted to purchase a vessel permit during a fishing year that would result in exceeding the aggregate 232.5 PSC limit. In this case, the entity must render at least one permit unusable (or ‘‘shelve’’ the permit) so that the entity is not operating above the PSC limit the following fishing year. Any permit that is shelved may not be enrolled in a sector, fished, or leased, but could be sold. An entity is prohibited from E:\FR\FM\21APR1.SGM 21APR1 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations purchasing additional permits once it exceeds the PSC limit. This is intended to provide operational flexibility for permit holders while still restricting them to the overall accumulation limit. This measure balances restrictions that are expected to sufficiently prevent excessive shares while avoiding adverse effects on market efficiency and flexibility. Additional information on these accumulation limits is available in the Amendment 18 environmental impact statement and the proposed rule. Effect of Combined Accumulation Limits The combination of the PSC limit and 5 percent permit cap raises the difficulty and cost of acquiring enough permits and PSC for any one entity in the groundfish fishery to exert market power over the fishery. Analyses in Amendment 18 conclude that no entity currently has an excessive share of permits. Analyses also show that the maximum allocation an entity could acquire would be around 20 PSC for the majority of stocks, though PSC for certain stocks, such as Georges Bank winter flounder, could be acquired at higher levels than other stocks. Any payoff from obtaining excessive shares would not be realized for many years, if at all. Therefore, the combination of an aggregate PSC limit of 232.5 and a 5percent permit cap should be sufficient to prevent market power from being exerted. nlaroche on DSK30NT082PROD with RULES Transfer of Permits by an Individual Entity That Has Exceeded the PSC Limit We expressed concern in the proposed rule that Amendment 18 does not include permit transfer restrictions on an individual entity that has exceeded the permit accumulation limit. We determined this could potentially create an unintended loophole that would allow transfers to related parties. Such transfers could result in family members controlling permits or PSC in excess of the limits. We argued this was inconsistent with the Council’s intent for Amendment 18 to limit an entity’s holdings to a level that would prevent exerting market power. We requested public comment on a restriction we proposed that would require permit transfers from an entity with a PSC greater than the PSC limit to be made via an ‘‘arm’s-length’’ transaction. For example, an arm’s-length transaction would be a permit transfer in the ordinary course of business between independent and unrelated entities, which would result in the owner who exceeded the limit maintaining no VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 interest in or control over the transferred permit and its PSC. We view this restriction to be consistent with the Council’s intent and the goals and objectives for the Amendment. This measure also improves the enforceability of the PSC accumulation limit. As a result, using our authority under section 305(d) of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), we are adding regulations to require that a permit transfer for individuals that have exceeded the accumulation limit to be by an arm’s-length transaction. Future Changes to Accumulation Limits Accumulation limits can be modified through a future framework adjustment if a vessel/permit buyback or buyout were enacted in the groundfish fishery. However, any other changes to the accumulation limits would require an amendment to the FMP. We encourage the Council to revisit the accumulation limits established in this Amendment if unanticipated developments adversely affect the goals and objectives of this Amendment. For example, a substantial reduction in the number of NE multispecies limited access permits (due to permit holders relinquishing their permits) could dramatically reduce the permit cap. Ownership Interest In order for an accumulation limit to be developed and applied, it is necessary to first define the ownership interest that will be limited. A unique definition of ownership interest as applied to the groundfish fishery is added in section 50 CFR 648.2 of the regulations. To identify ownership interests and account for accumulation limits in the groundfish fishery, a permit holder is required to identify all persons who hold an ownership interest in a particular permit when submitting a groundfish permit application or renewal form for that permit. 2. Handgear A Measures To reduce effort controls and increase flexibility for small boat fishermen, this action removes or modifies several management measures affecting limited access permitted handgear vessels (Handgear A vessels). First, this action removes the March 1–20 spawning-block closure for all Handgear A vessels. Fishing effort by Handgear A vessels is restricted by a very small annual catch limit, and vessels are subject to other spawning closures. This measure makes the regulations for Handgear A vessels more consistent with vessels fishing in PO 00000 Frm 00021 Fmt 4700 Sfmt 4700 18707 sectors, which account for most of the groundfish fishing effort and are already exempt from the 20-day spawning block. This measure is not anticipated to have any substantial biological consequences and will provide additional fishing opportunities for Handgear A vessels. Handgear A vessels are no longer required to carry a standard fish tote on board. This requirement was initially implemented to aid in the sorting and weighing of fish by both fishermen and enforcement personnel. However, enforcement no longer uses totes for atsea weight and volume estimates, so the requirement for vessels to carry a tote is no longer necessary. Lastly, this action allows a sector to request an exemption from the requirement for Handgear A vessels to use a Vessel Monitoring System (VMS). Handgear A fishermen enrolled in a sector are currently required to utilize a VMS; however, installing and utilizing a VMS system makes enrolling in a sector cost prohibitive for these small vessels. Any sector interested in utilizing this exemption is required to submit an exemption request to us for approval. If a sector exemption were approved, a Handgear A vessel fishing within a sector utilizing the exemption would declare its trips through the interactive voice response call-in system instead of through a VMS. This measure is intended to encourage Handgear A vessels to enroll in a sector by reducing operating expenses. Sectors receive regulatory exemptions and larger allocations that could provide additional flexibility and fishing opportunities to Handgear A vessels. Measures That Can Be Addressed in a Future Framework This action allows two measures analyzed in Amendment 18 to be implemented through a future framework action. The Council explored establishing a separate, optional allocation for the Handgear A fishery. Additionally, there was some interest in considering separate management measures for an inshore/offshore Gulf of Maine (GOM) boundary, including separate allocations for inshore and offshore GOM cod. However, because current catch limits for key groundfish stocks, including GOM cod, are so low, further sub-dividing allocations for Handgear A, as well as inshore and offshore GOM cod, were controversial and would be difficult to develop and implement at this time. As a result, the Council elected to potentially consider these measures in a future framework. In addition, several regulatory clarifications are included at § 648.90 to E:\FR\FM\21APR1.SGM 21APR1 18708 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations better delineate the responsibilities of the groundfish plan development team (PDT) as well as which Council management measures could be modified in a future framework. nlaroche on DSK30NT082PROD with RULES Comments and Responses on Amendment 18 and the Measures Proposed in the Amendment 18 Proposed Rule We received 15 comments during the public comment period on the Amendment 18 proposed rule. We specifically requested comments on the Council’s proposed measures in Amendment 18 and whether they are consistent with the NE Multispecies FMP, the Magnuson-Stevens Act and its National Standards, and other applicable law. Eight commenters, including the Associated Fisheries of Maine (AFM), Environmental Defense Fund (EDF), Northwest Atlantic Marine Alliance (NAMA), Massachusetts Division of Marine Fisheries (MADMF), Penobscot East Resource Center (PERC), Conservation Law Foundation (CLF), and a few commercial fishermen wrote in general opposition to the measures proposed in Amendment 18. The Northeast Seafood Coalition (NSC) and Gloucester Fishermen’s Community Preservation Fund (GFCPF) supported the Amendment. We consolidated responses to similar comments and our responses are below. Comments on the Amendment 18 Environmental Impact Statement Comment 1: One commenter suggested including more details on information and opinions expressed by fishing stakeholders during the Amendment 18 public meeting sessions. This commenter also suggested that the pros and cons of sector management and Amendment 18 be linked more clearly. Response: Ample information and documentation was available to the Council, NMFS, and the public during this decision making process. In addition to topical summaries in section 3.4 of Amendment 18, Appendix II has a 30-page summary of the public hearings, including both oral and written comments on the Amendment. Responses to those public comments are included in Appendix III and provide an adequate description of stakeholder concerns. Section 7.6.1.2 of Amendment 18 includes a social impact analysis that reviews the impacts on fishermen and fishing communities. The influence and interactions of sector management with the groundfish fishery and fishing communities were also described in the Compass Lexecon report summarized in the Amendment and the proposed rule. This report is also publically available VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 online at http://archive.nefmc.org/ nemulti/planamen/Amend%2018/ compass_lexecon/ NEMFC%20Report%20Final.pdf. Comment 2: One commenter argued that there is minimal discussion on how the accumulation limits and catch caps will affect the future viability of the fleet, and that more should be included. Response: Analyses of the social and economic impacts of the accumulation limits are included in section 7.6.2 of Amendment 18, as well as the regulatory impact review, in Section 9.11. These analyses include a discussion of both the short and longterm impacts of the alternatives, which are also summarized in Table 1 of the Amendment. Amendment 18 Goals and Objectives Comment 3: Many commenters, including those that generally supported and opposed the Amendment, argued that the proposed management measures would not meet the goals and objectives of Amendment 18. The general concern was that consolidation would still occur and that fleet diversity would not be promoted as a result. Response: Management measures in Amendment 18 do address the goals and objectives of the Amendment. Accumulation limits address goals 1, 3, and 4 of the Amendment by making it unlikely an entity could gain an excessive share of the fishery and exert market power over other fishermen and stakeholders. A detailed discussion of the goals and objectives was provided in the Amendment and the preamble to the proposed rule. The goals and objectives include promoting fleet diversity, upholding a resilient and stable fishery, and preventing any individual or entity from acquiring or controlling an excessive share of the fishery. Amendment 18 acknowledges that it is likely additional consolidation may occur with these accumulation limits in place. However, it is not expected to occur to the extent where an entity could acquire an excessive share and exert market power over other entities. Curbing consolidation helps to maintain diversity even to a limited degree. While other measures considered were more restrictive, the measures adopted by the Council achieve the goals and objectives. As a result, establishing accumulation limits promotes a more diverse and stable groundfish fishery. Comments 5–14 below provide a detailed discussion on the accumulation limits. Measures modifying and removing limited access handgear fishery restrictions address goals 1, 2, and 3 within the Amendment. PO 00000 Frm 00022 Fmt 4700 Sfmt 4700 Comment 4: Several members of the fishing industry and industry organizations contend that increasing operational flexibility, reducing business expenses such as at-sea monitoring costs, allocating higher and more stable catch limits, reducing input controls, and controlling groundfish catch from other fisheries would be more effective management measures to address the long-term sustainability of the groundfish fleet. Response: The Council’s intent for Amendment 18 was to develop accumulation limits for the groundfish fishery to prevent an entity from acquiring an excessive share. This was explained in the Federal Register notice that established a control date for such limits (67 FR 19305; April 7, 2011) and announced at public scoping hearings (76 FR 79153; December 21, 2011), as well as in the proposed rule for this action (81 FR 92763; December 20, 2016). As explained in Comment 3, the approved management measures meet the goals and objectives of the Amendment. The actions suggested by several members of the fishing industry could also promote the Amendment 18 goals objectives and are worth future consideration by the Council. Accumulation Limits Comment 5: Several commenters were critical of the excessive-shares report developed by Compass Lexecon. Response: The Council contracted Compass Lexecon to provide an independent review of excessive permit shares in the groundfish fishery. Preliminary results of the analysis were presented to the Council’s Groundfish Committee at a number of its meetings so that the Committee and the public could comment. The final report was also peer reviewed, which allowed for additional opportunities for the public to provide input and comment on the analysis. The Council considered the final Compass Lexecon report, the peer review reports, public comments on the analysis, and other analyses conducted in support of the Amendment, when making its decision on Amendment 18 accumulation limit alternatives. The peer reviewer reports can be found here at https://www.st.nmfs.noaa.gov/ science-quality-assurance/cie-peerreviews/cie-review-2014. Comment 6: Most opponents, including MADMF, CLF, EDF, NAMA, and PERC, contend that the proposed accumulation limits are too high and will foster further consolidation, which, in turn, reduces fleet diversity. Several commenters expressed concern that some entities could take advantage of E:\FR\FM\21APR1.SGM 21APR1 nlaroche on DSK30NT082PROD with RULES Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations low allocations and permit prices to acquire additional permits to exert market power over the fishery. On the other hand, supporters of the Amendment, such as NSC, argue that the higher accumulation limits are necessary to offset constraining quotas, and that a lower accumulation limit would have penalized permit holders for what they had already acquired. Response: Since the approval of Amendment 16 and the expansion of sectors in the groundfish fishery, many industry members and stakeholders have become increasingly concerned about fleet consolidation and the resulting negative impacts on fishing vessels and fishing communities. Amendment 18 was developed to address these concerns. Some fishing industry members and organizations argued for more restrictive accumulation limits. Several organizations, such as CLF, viewed the establishment of accumulation limits as an opportunity to readjust the allocations from Amendment 16. For example, some suggested stock-specific PSC limits ranging from 2.5 to 10 PSC, and one commenter proposed reducing the permit cap from 5 to 2.5 percent. These limits are much more restrictive than the PSC many entities currently have and could have adversely affected an entity’s ability to adapt to changing conditions. Also, limits as restrictive as these could have forced divestiture by reallocating PSC from larger businesses to smaller. During the development of Amendment 18, annual catch limits for many groundfish stocks were significantly reduced. Since there was less quota affiliated with each permit, some fishermen acquired more permits and PSC to sustain fishing operations and remain viable. Many entities and organizations argued that more restrictive accumulation limits would have negatively affected many businesses by adversely affecting the market for permits and PSC. The Council had to balance the need for accumulation limits with the need to provide operational flexibility to the fleet. Understanding that no entity currently holds an excessive share of the fishery, the Council selected the alternative that provides the most operational flexibility to the fleet while substantially reducing the risk of an entity acquiring an excessive share of permits. If conditions or circumstances in the fishery change, the Council can re-visit the accumulation limits established through this action if necessary. Comment 7: Several commenters provided hypothetical mathematical VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 scenarios where entities could acquire large allocations for one or more stocks and potentially have an excessive share of permits. For example, an entity could acquire a PSC of 50 for stock A, a PSC of 30 for stock B, a PSC of 30 for stock C, and small allocations of other stocks and still be under the PSC limit. Critics contend that this would allow an entity to acquire an excessive share. Response: While the accumulation limit measures may mathematically allow an entity to acquire an excessive share of groundfish permits, it is very unlikely this will occur. These ‘‘worst case’’ scenarios were described in a ‘‘deterministic analysis’’ in Amendment 18 (Section 9.11.1.4.1). This analysis examined how much PSC an entity could acquire under the accumulation limits if it were able to purchase the permits with the most PSC for a particular stock. For example, an entity could acquire either 40 PSC of GOM cod or 73 PSC of Georges Bank winter flounder, before reaching an accumulation limit. However, as explained in the Amendment and its supporting analyses, the deterministic analysis is not necessarily a realistic scenario because of the high costs and logistical difficulty of acquiring the specific permits that contain the highest PSC for a specific stock that could allow an entity to exert market power. Amendment 18 also includes a probabilistic analysis, which is a model designed to predict the likelihood that an individual could strategically acquire permits that have high levels of PSC while remaining under the permit cap. The probabilistic analysis concludes that this would be very difficult. Under the probabilistic analysis, the median accumulation for all stocks was below 20 PSC. The Amendment 18 economic discussion concludes that the probabilistic analysis is much more realistic than the potential PSC limits projected under the deterministic analysis. The review also explains that even without the accumulation limits, acquiring the necessary permits to hold an excessive share would be extremely complex, expensive, and time consuming. This may explain why no entity currently holds an excessive share of permits, despite years without any limitations. The Compass Lexecon report used by the Council to research excessive shares in the groundfish fishery also found a substantial ‘‘competitive fringe’’ in several groundfish stocks. A competitive fringe is a large group of permit holders who hold a relatively small amount of PSC. If the permit holders in the competitive fringe are efficient, then they are likely to remain in the fishery PO 00000 Frm 00023 Fmt 4700 Sfmt 4700 18709 and help preserve a competitive market structure. In a fishery where there is a competitive fringe, an entity could acquire a high PSC of a given stock yet be unable to exert market power. The Compass Lexecon report concluded that ‘‘an excessive-share cap of about 15 percent would be sufficient to ensure low concentration for ACE regardless of the level of the competitive fringe. The large competitive fringe for some species could allow for a higher share cap, should the [Council] choose to recommend separate caps for different species.’’ While the Compass Lexecon recommendation was stock-specific, the report did not include a permit cap in addition to the PSC cap. The Amendment 18 analyses conclude that combining the PSC limit and permit cap should prevent an entity from acquiring an excessive share of permits. Comment 8: Several commenters, including EDF and CLF, argue the Amendment violates National Standards 4 and 8 because the accumulation limits do nothing to prevent consolidation of the fleet and do not manage fishing access consistent with historical activities. Response: We have carefully reviewed the provisions in Amendment 18 and have determined that the Amendment is consistent with both National Standards 4 and 8. Amendment 18 is designed to fairly and equitably prevent the acquisition of excessive shares as the fishery consolidates. No measures in it are designed to prevent the status quo from continuing or an expansion from occurring as stocks recover. By putting in place measures designed to prevent the acquisition of excessive shares while providing for operational flexibility, this action minimizes to the extent practicable the adverse economic effects that could accompany such restrictions on the purchase and sales of groundfish permits, their PSC, and fishing vessels. An explanation of how Amendment 18 meets National Standards 4 and 8 is provided in Section 9.1.1 of Amendment 18. Amendment 18 suggests that further consolidation is anticipated, even with the accumulation limits, but not to the extent where an entity could acquire an excessive share of the fishery. Consolidation could occur at a greater rate without the accumulation limits established through this action. Importantly, the Amendment 18 analysis concludes that fishing communities would be worse off if the proposed accumulation limits were not implemented because entities would remain unconstrained in their ability to acquire permits and PSC, including E:\FR\FM\21APR1.SGM 21APR1 nlaroche on DSK30NT082PROD with RULES 18710 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations potentially acquiring an excessive share of the fishery. We encourage the Council to continue developing additional management measures that mitigate fleet consolidation and promote fleet diversity. Comment 9: Several commenters, including MADMF, EDF, CLF, and PERC suggested that PSC limits should be species or stock-specific instead of the aggregate PSC limit adopted in this action. Others, like the GFCPF and NSC argued that the PSC limits need to be aggregate because groundfish permits include all groundfish stocks and are not severable. Response: The Council considered these concerns when developing this Amendment. In its report, Compass Lexecon suggested that PSC limits should be stock specific. Four of the six PSC limit alternatives were stockspecific alternatives. However, proponents of an aggregate limit explained that groundfish permits are aggregate permits, with each permit containing a PSC for each allocated stock. A stock-specific PSC limit would restrict the ability for an entity to acquire additional PSC in more than one stock, which is a challenge in a multispecies fishery. Because of this, the Council concluded that the stockspecific limits may be overly restrictive given the current circumstances in the fishery and not necessary at this time. As explained above, the Amendment 18 economic analysis concluded that the aggregate PSC limit, along with the permit cap, should deter an entity from acquiring an excessive share of permits. Comment 10: One commenter suggested that accumulation limits should include limiting a sector’s annual catch entitlement (ACE) at the species or stock level. Response: The accumulation limits in this action do not apply to a sector’s ACE. Available analyses show that there is no need for an excessive share cap on sector-affiliated ACE because the sectors themselves do not control how member vessels use ACE. Since the implementation of Amendment 16, each sector has reallocated its ACE to its members in a manner consistent with each member’s PSC. If a groundfish sector were to modify its operations in a manner where it began to exercise control over how vessel operators used ACE, it could be worthwhile to consider an ACE limit. Also, there are no specific regulations that prevent one sector from dividing into multiple sectors. If an ACE limit was adopted and a sector was at risk of reaching that limit, the members could simply break into two separate sectors VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 to avoid the limit, but continue operating collaboratively. For these reasons, establishing an accumulation limit for sector ACE is not necessary at this time and was not included in Amendment 18. Comment 11: EDF suggested that fishing associations and permit banks should have different PSC caps than individual entities. Response: The Council discussed this idea in detail but was never able to clearly define a permit bank due to the difficulty of identifying and distinguishing different types of owners and permit banks. For example, the difference between an individual or organization that holds multiple permits and a permit bank is not easily defined. Some, such as EDF, argued that nonprofits (particularly environmental nongovernment organizations) should have a higher PSC limit to promote permit banking operations, while opponents were concerned that granting nonprofits higher PSC limits could reduce fishermen’s access to ACE and reduce fishing opportunities and landings. Due to these complications, the Council elected not to focus on this aspect and selected a single PSC and permit limit for all permit holders. Comment 12: CLF contends that an entity should not be able to exceed the PSC limit and ‘‘shelve’’ a permit. It argues that this measure would allow an entity to choose which permit to shelve so that it could target PSC for a particular species with a higher likelihood of achieving market power. CLF also suggested that shelving a permit has a similar economic effect on the fishery as fishing it because other fishermen are unable to utilize the shelved PSC. Response: This measure was selected by the Council because it provides fishermen more flexibility when purchasing aggregated multispecies permits, for reasons similar to those explained in Comment 9. The challenge fishermen encounter is that each permit has PSC for all groundfish stocks. A fisherman looking to acquire a specific permit with a higher PSC in a stock they want or need to target may be unable to do so because of PSCs from other stocks on the permit. This measure was designed to give fishermen the flexibility to shift target species or permits while remaining under the PSC limit. To prevent an entity from trying to acquire an excessive share of permits, vessel owners are not able to acquire an additional permit if they have shelved a permit. The PSC affiliated with a ‘‘shelved’’ permit is unusable and is not redistributed to the fishery. PO 00000 Frm 00024 Fmt 4700 Sfmt 4700 However, we understand some of the concerns expressed by CLF. Although the Council was focused on maintaining flexibility, we recommend that the Council discuss and reconsider the ability for an entity to exceed the PSC limit then ‘‘shelve’’ a permit. Comment 13: One commenter requested that NMFS specifically codify the 5-percent permit cap at 69 permits, which is 5 percent of the approximately 1,373 total limited access NE multispecies permits. Response: This comment is in direct response to our concern expressed in the proposed rule—that an unanticipated dramatic drop in limited access permits (due to permit holders relinquishing their permits) could substantially reduce the permit cap. For example, when Amendment 18 was developed, there were approximately 1,373 limited access groundfish permits, which would result in a 5-percent permit cap of 69 permits. As of February 21, 2017, there were 1,335 limited access groundfish permits, which sets a permit cap at 67 permits. A more substantial reduction could greatly reduce the permit cap. As we explained in the proposed rule, this issue could be discussed and addressed by the Council in a future action, if necessary. We are not including regulations specifying a specific number of permits for the permit cap because we determined it would not be consistent with the Council’s intent to limit the degree of consolidation. Comment 14: Three commenters supported, and two commenters opposed, our suggestion that permit transfers for entities who have exceeded the PSC limit and ‘‘shelved’’ permits should be transferred via an ‘‘arm’slength’’ transaction. Those commenters in opposition suggested that the measure should first be considered and discussed by the Council. Response: As explained in the preamble above, the arm’s-length transaction requirement closes a loophole to the PSC limit restriction. Without this additional restriction, a loophole could allow an entity to indirectly acquire an excessive share of the fishery through collusion of permit holdings. This measure improves the enforceability of the PSC accumulation limit and ensures that the limit is a real limit, not just a limit on paper. Without the arm’s-length transfer requirement, an entity could undermine the intent of the accumulation limits by transferring a permit to a family member or other entity the transferor controls indirectly. The Council did not provide public comment on this measure; however, we determined that ensuring the limits are E:\FR\FM\21APR1.SGM 21APR1 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations nlaroche on DSK30NT082PROD with RULES effective is consistent with the Council’s intent and the goals and objectives of Amendment 18. For these reasons, we are implementing this requirement. Other Measures Comment 15: The Northeast Hook Fishermen’s Association wrote in support of the Handgear A management measures. Response: We agree that these measures will provide additional operating flexibility for Handgear A vessels and have approved these measures. The Council should continue to consider management measures that will provide increased flexibility and additional fishing opportunities for handgear vessels. Comment 16: Two commenters argued there is a greater need for market transparency in the groundfish fishery and urged the Council and NMFS to make ACE trade data more transparent. They expressed concern that a lack of market and trade information is detrimental to some fishermen who may be undervaluing their allocations or unknowingly overpaying for quota. It was suggested that trade data could be aggregated in a manner so that confidential information is not released. Response: The Council considered an alternative in Amendment 18 to exempt ACE disposition data from confidentiality restrictions. Under this alternative, value associated with the movement of ACE within and between sectors would have been considered non-confidential and made available to the public. Consistent with current data submission timeframes, price data on trades made between sectors would have been made available during the fishing year. Price data on the movement of ACE within sectors would have been made available after the end of the fishing year. Under the Magnuson-Stevens Act, only data required to be submitted to NMFS for a determination in a limited access program can be released. The Council did not select this alternative as preferred because NMFS determined that ACE price data are not submitted to NMFS for a determination in the sector catch-share program, and, therefore, may not be released under the Magnuson-Stevens Act data confidentiality provisions. Because these data are confidential per the Magnuson-Stevens Act requirement, neither the Council nor NMFS can release pricing behavior and ACE usage at the level of detail requested. Comment 17: NAMA and PERC suggested that Amendment 18 should have included inshore and offshore management measures for the GOM. VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 These groups requested that a shortterm task force be established to develop inshore and offshore fishery management measures. Response: We agree that inshore and offshore management measures are worth further consideration. As explained in Amendment 18 and the proposed rule for this action, the Council considered, but decided not to pursue, development of distinct inshore and offshore fishery management measures for vessels fishing in the GOM. The Council spent considerable time debating these issues and elected to potentially pursue the measures in a future framework adjustment. Requests to establish a short-term task force should be brought to the Council and its Groundfish Oversight Committee. Comment 18: EDF expressed concern that establishing the Redfish Exemption Area would increase misreporting and suggested that any vessel targeting redfish in an exemption area be required to have 100-percent monitoring coverage, or be monitored electronically. Response: The Council chose not adopt the Redfish Exemption Area in Amendment 18. However, groundfish sector vessels have a regulatory exemption from minimum mesh size requirements so they can better target redfish. A proposed rule soliciting public comment on sector operations plans and exemptions for the 2017–2018 fishing years will be published in spring 2017. Comments on the Redfish Exemption Area should be made through that action. Comment 19: Two commenters were critical of how the Council managed the public comment process during the development of Amendment 18, arguing that the Council often disregards fishermen’s concerns. One organization wrote in support of the Council process. Response: We disagree that the Council mismanaged the public comment process. The public had ample opportunities to comment on Amendment 18 and its proposed management measures. Amendment 18 was developed over several years during dozens of public meetings. All of the management measures were developed with public comment. The public was able to comment on the scope of the Amendment, review draft and final environmental impact statements, critique the Amendment itself, and respond to proposed regulations. The Council and NMFS followed public comment processes required by the National Environmental Policy Act, the Magnuson-Stevens Act, and the Administrative Procedure Act (APA). PO 00000 Frm 00025 Fmt 4700 Sfmt 4700 18711 Changes From the Proposed Rule As explained in the preamble of this rule and in Comment 14 above, using our authority under section 305(d) of the Magnuson-Stevens Act, we added a regulatory measure at 50 CFR 648(a)(1)(i)(N)(4) that requires permit transfers for individuals that exceed the accumulation limit to be made by an arm’s-length transaction. The arm’slength requirement was discussed in the preamble of the proposed rule. The regulatory text proposed at § 648.4(a)(1)(i)(N) was revised to better clarify how the grandfather provision is applied to the accumulation limits implemented through this action. Classification Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that the management measures implemented in this final rule are necessary for the conservation and management of the NE multispecies fishery and consistent with the Magnuson-Stevens Act, and other applicable law. The Council prepared, and NMFS filed, a final environmental impact statement (FEIS) for this action with the Environmental Protection Agency (EPA). The EPA published a notice of availability for the FEIS on October 14, 2016 (81 FR 71094). In approving the Amendment on March 6, 2017, NMFS issued a record of decision (ROD) identifying the selected alternative. A copy of the ROD is available from NMFS (see ADDRESSES). This final rule has been determined to be not significant for purposes of Executive Order (E.O.) 12866. This final rule does not contain policies with Federalism or ‘‘takings’’ implications as those terms are defined in E.O. 13132 and E.O. 12630, respectively. This rule includes two regulatory modifications that will increase the operational flexibility for Handgear A vessels. Because these regulatory changes relieve regulatory restrictions, these measures are not subject to the 30day delayed effectiveness provision of the APA pursuant to 5 U.S.C. 553(d)(1). Currently, Handgear A vessels are required to carry a standard fish tote on board. Because enforcement no longer use totes for at-sea weight and volume estimates, the requirement for vessels to carry a tote is unnecessary and is being removed. This action also allows a groundfish sector to request an exemption from requiring Handgear A vessels to utilize a vessel monitoring system (VMS). Currently, all sector E:\FR\FM\21APR1.SGM 21APR1 18712 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations vessels are required to use a VMS while fishing. Handgear vessels have argued that this requirement is cost prohibitive. If an exemption were requested and approved, Handgear A vessels enrolled in a sector with the exemption would no longer be required to purchase a VMS. This measure increases the feasibility for a Handgear A vessel to enroll in a sector by reducing its operating expenses. nlaroche on DSK30NT082PROD with RULES Final Regulatory Flexibility Analysis Section 604 of the Regulatory Flexibility Act (RFA) requires an agency to prepare a final regulatory flexibility analysis (FRFA) after being required by that section or any other law to publish a general notice of proposed rulemaking and when an agency promulgates a final rule under section 553 of Title 5 of the U.S. Code. The FRFA describes the economic impact of this action on small entities. The FRFA includes a summary of significant issues raised by public comments, the analyses contained in Amendment 18 and its accompanying FEIS/Regulatory Impact Review/Initial Regulatory Flexibility Analysis (IRFA), the IRFA summary in the proposed rule, as well as the summary provided below. A statement of the necessity for and objectives of this action are contained in Amendment 18 and in the preamble to this final rule, and is not repeated here. A copy of this analysis is available from the Council (see ADDRESSES). A Summary of the Significant Issues Raised by the Public in Response to the IRFA, a Summary of the Agency’s Assessment of Such Issues, and a Statement of Any Changes Made in the Final Rule as a Result of Such Comments Our responses to all of the comments received on the proposed rule, including those that raised significant issues with the proposed action, or commented on the economic analyses summarized in the IRFA and below, can be found in the Comments and Responses section of this rule. Comment 2 suggested that additional analyses detailing how permit caps will affect the future viability of the fleet was needed. Comment 5 explained that several commenters were critical of an independent report and analyses utilized by the Council to develop Amendment 18 accumulation limits. Comment 6 summarized that most opponents to the Amendment contend that the accumulation limits will promote additional consolidation and reduced fleet diversity. Detailed responses are provided to each of these specific comments and are not repeated here. There were no other comments VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 directly related to the IRFA; the Chief Counsel for the Office of Advocacy of the Small Business Administration (SBA) did not file any comments. No changes to the proposed rule measures were necessary as a result of these public comments. Description and Estimate of the Number of Small Entities to Which This Rule Will Apply On December 29, 2015, NMFS issued a final rule establishing a small business size standard of $11 million in annual gross receipts for all businesses primarily engaged in the commercial fishing industry (NAICS 11411) for Regulatory Flexibility Act (RFA) compliance purposes only (80 FR 81194, December 29, 2015). The $11 million standard became effective on July 1, 2016, and is to be used in place of the SBA’s current standards of $20.5 million, $5.5 million, and $7.5 million for the finfish (NAICS 114111), shellfish (NAICS 114112), and other marine fishing (NAICS 114119) sectors, respectively, of the U.S. commercial fishing industry in all NMFS rules subject to the RFA after July 1, 2016. Pursuant to the RFA, and prior to July 1, 2016, an IRFA was developed for this regulatory action using SBA’s size standards. NMFS has reviewed the analyses prepared for this regulatory action in light of the new size standard. Under the previously-used SBA’s size standards, all of the commercial finfish and other marine fishing businesses were considered small, while 12 of the 237 shellfish businesses were determined to be large (Tables 1 and 2). The new standard could result in a few more commercial shellfish businesses being considered small. However, taking the size standard change into consideration, NMFS has identified no additional significant alternatives that accomplish statutory objectives and minimize economic impacts of the proposed rule on small entities. Further, the new size standard does not affect the decision to prepare a FRFA as opposed to a certification for this regulatory action. Analyses in Tables 2 and 3 below reveal that no groundfish-dependent entities exceeded the previous SBA standard of $5.5 million in gross sales, with the mean gross sale per entity being less than $2 million. It is therefore unlikely that any finfish, or more specifically, groundfish-dependent vessels, would be considered a large business under the new NMFS size standard. Amendment 18 regulates commercial fish harvesting entities engaged in the NE multispecies limited access fishery. PO 00000 Frm 00026 Fmt 4700 Sfmt 4700 A description of the specific entities that are likely to be impacted is included below for informational purposes, followed by a discussion of those regulated entities likely to be impacted by the proposed regulations. For the purposes of the RFA analysis, the ownership entities, not the individual vessels, are considered the regulated entities. Individually-permitted vessels may hold permits for several fisheries, harvesting species of fish that are regulated by several different FMPs, even beyond those affected by Amendment 18. Furthermore, multiple permitted vessels and/or permits may be owned by entities affiliated by stock ownership, common management, identity of interest, contractual relationships, or economic dependency. For this analysis, ownership entities are defined by those entities with common ownership personnel as listed on permit application documentation. Only permits with identical ownership personnel are categorized as an ownership entity. For example, if five permits have the same seven personnel listed as co-owners on their application paperwork, those seven personnel form one ownership entity, covering those five permits. If one or several of the seven owners also own additional vessels, with sub-sets of the original seven personnel or with new co-owners, those ownership arrangements are deemed to be separate ownership entities for the purpose of this analysis. Ownership entities are identified on June 1 of each year based on the list of all permit numbers for the most recent complete calendar year that have applied for any type of NE Federal fishing permit. At the time of the Amendment 18 analyses, the ownership data set was based on calendar year 2014 permits and contained gross sales associated with those permits for calendar years 2012 through 2014. On June 1, 2015, there were 661 commercial business entities potentially regulated by this action. Entities permitted to operate in the NE multispecies limited access fishery are described in Tables 1 and 2. As of June 1, 2015, there were 1,147 individual limited access permits. The 34 for-hire businesses included here are entities affiliated with limited access commercial groundfish permits, but derive greater than 50 percent of their gross sales from party/charter operations. All are small businesses (average gross revenues from 2012–14 are less than $7.5 million). The remaining 75 entities had no revenue and are classified as small. E:\FR\FM\21APR1.SGM 21APR1 18713 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations These totals may mask some diversity among the entities. Many, if not most, of these ownership entities maintain diversified harvest portfolios, obtaining gross sales from many fisheries and are not dependent on any one. However, not all are equally diversified. Those that depend most heavily on sales from harvesting species affected directly by Amendment 18 are most likely to be affected. By defining dependence as deriving greater than 50 percent of gross sales from sales of regulated species associated with a specific fishery, those ownership groups most likely to be affected by the proposed regulations can be identified. Using this threshold, 61 entities are groundfish-dependent; all of which are small under both the SBA and NMFS size standards (Table 3). TABLE 1—ENTITIES REGULATED BY AMENDMENT 18 Number Number small Primarily finfish ............. Primarily shellfish .......... Primarily for-hire ........... No Revenue .................. 315 237 34 75 315 225 34 75 Total .......................... 661 649 Type TABLE 2—DESCRIPTION OF REGULATED ENTITIES BY GROSS SALES Sales category Number small Number <$50K ....................................................... 50–100K ................................................... 100–500K ................................................. 500K–1mil ................................................ 1–5.5mil .................................................... 5.5mil+ ..................................................... 186 71 225 91 74 14 Mean gross sales 186 71 225 91 73 3 Median gross sales $10,597 76,466 244,672 734,423 1,899,461 11,900,790 Mean permits per entity $1,954 78,736 219,731 720,668 1,498,138 7,383,522 Max permits per entity 1.3 1.3 1.3 1.7 2.4 12.4 30 3 4 7 11 28 TABLE 3—IMPACTED GROUNDFISH-DEPENDENT REGULATED COMMERCIAL GROUNDFISH ENTITIES BY GROSS SALES Sales <$50K ................................... 50–100K ............................... 100–500K ............................. 500K–1mil ............................ 1–5.5mil ................................ Total ownership entities Entities (number) Large businesses (number) nlaroche on DSK30NT082PROD with RULES Median gross sales per entity Mean gross sales per entity Median groundfish sales per entity Mean groundfish sales per entity 0 0 0 0 0 1.0 1.1 1.6 1.2 2.2 1 2 4 2 4 $10,116 72,052 226,938 698,226 1,553,597 $20,316 67,390 240,833 718,231 1,854,052 $8,831 56,221 116,018 398,548 1,292,445 $16,476 49,341 172,331 491,838 1,403,896 61 0 .................... .................... .................... .................... .................... .................... This final rule contains a collectionof-information requirement subject to the Paperwork Reduction Act (PRA) and which is under review by OMB under control number 0648–0202. This revision requires any entity that has exceeded the PSC limit to render one or more permits ‘‘unusable’’ so that the entity would be operating within the allocation limit. If an entity exceeds the PSC limit, the entity would be required to complete a ‘‘Permit Shelving Form’’ and render one or more permits unusable. Public reporting burden for the permit shelving form is estimated to average 30 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. If two entities had to complete a ‘‘Permit Shelving Form,’’ the burden estimate 13:51 Apr 20, 2017 Maximum fishing permits per entity (number) 6 7 22 13 13 Description of Projected Reporting, Record Keeping, and Other Compliance Requirements VerDate Sep<11>2014 Average fishing permits owned per entity (number) Jkt 241001 would be 1 hr and cost $1. Currently, no entity exceeds the PSC allocation limit; the most PSC any entity holds is approximately 140 PSC, and the limit is 232.5 PSC. As a result, it is unlikely that any entity would reach this threshold, or that this action would directly affect fishing operations. Send comments regarding these burden estimates or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS (see ADDRESSES) and by email to OIRA_Submission@omb.eop.gov, or fax to 202–395–7285. Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number. PO 00000 Frm 00027 Fmt 4700 Sfmt 4700 Description of the Steps the Agency Has Taken To Minimize Significant Economic Impact on Small Entities Consistent With the Stated Objectives of Applicable Statutes This FRFA is intended to analyze how small entities would be affected by the Amendment 18 management measures. This action is expected to have minimal, if any, impact on regulated small entities. The vast majority (649 out of 661) of potentially regulated entities are classified as small businesses by SBA and NMFS business size standards. In general, the small entities regulated by this action will be unaffected. The majority of limited access groundfish permit holders possess permits and PSC in far smaller quantities than the proposed accumulation limits. However, individuals who comprise a part of, or the entirety of, these small entities could be restricted in the number of permits or the amount of PSC shares they wish to accumulate in the future, which could affect potential revenue. E:\FR\FM\21APR1.SGM 21APR1 18714 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations nlaroche on DSK30NT082PROD with RULES The PSC limit alternative that was selected for this action provided the most flexibility of all the alternatives proposed. Vessel permit holders can continue to accumulate permits in a manner that allows them to maximize fishing opportunities within their portfolio. Several stock-specific PSC limit alternatives considered in the Amendment were not selected because the Council determined the alternatives would have been too restrictive. For example, limiting an ownership entity to an accumulation limit equivalent to the PSC held as of the control date could have forced divestiture in the fishery and would have prevented ownership entities from growing. Similarly, establishing a specific accumulation limit for a specific groundfish stock could have reduced opportunities for entities to expand into other fisheries and restrict operational flexibility. Additional information on these alternatives is available in section 4.1 of the Amendment. Handgear A permit holders will be largely unaffected by the limited access handgear measures. As explained in the preamble, the Handgear A management measures approved in this action actually remove regulatory restrictions, increasing operational flexibility and fishing opportunities. Several management measures and alternatives were considered but not selected by the Council. Other alternatives may be considered in a future framework, as explained in the preamble above. Additional information on these alternatives and justifications for the Council’s decision are explained in section 4 of the Amendment. Small Entities Compliance Guide Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as ‘‘small entity compliance guides.’’ The agency shall explain the actions a small entity is required to take to comply with a rule or group of rules. As part of this rulemaking process, a letter to permit holders that also serves as small entity compliance guide (the guide) was prepared. Copies of this final rule are available from the Greater Atlantic Regional Fisheries Office, and the guide, (i.e., bulletin), will be sent to all holders of permits for the NE multispecies fishery. The guide and this final rule will be available upon request. VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 List of Subjects in 50 CFR Part 648 Fisheries, Fishing, Reporting and recordkeeping requirements. Dated: April 17, 2017. Alan D. Risenhoover, Acting Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service. For the reasons stated in the preamble, NMFS amends 50 CFR part 648 as follows: PART 648—FISHERIES OF THE NORTHEASTERN UNITED STATES 1. The authority citation for part 648 continues to read as follows: ■ Authority: 16 U.S.C. 1801 et seq. 2. In § 648.2, add a definition for ‘‘Ownership interest’’ in alphabetical order to read as follows: ■ § 648.2 Definitions. * * * * * Ownership interest, in the NE multispecies fishery, includes, but is not limited to holding share(s) or stock in any corporation, any partnership interest, or membership in a limited liability company, or personal ownership, in whole or in part, of a vessel issued a limited access NE multispecies permit or confirmation of permit history (CPH), including any ownership interest in any entity or its subsidiaries or partners, no matter how far removed. * * * * * ■ 3. In § 648.4, add paragraph (a)(1)(i)(N) and revise paragraph (c)(2)(i) to read as follows: § 648.4 Vessel permits. (a) * * * (1) * * * (i) * * * (N) Accumulation limits—(1) 5percent permit/CPH restriction. Any person with an ownership interest in the NE multispecies fishery is not eligible to be issued a limited access NE multispecies permit or CPH for a vessel if the issuance results in the person having an ownership interest in excess of 5 percent of all limited access NE multispecies permits and CPH that are issued as of the date the permit/CPH application is received by the NMFS. (2) PSC limit. Any person with an ownership interest in the NE multispecies fishery is not eligible to be issued a limited access NE multispecies permit or CPH for a vessel that results in that person’s average potential sector contribution (PSC) exceeding a share of 15.5 for all the allocated stocks in aggregate, except as provided in paragraph (a)(1)(i)(N)(4) of this section. PO 00000 Frm 00028 Fmt 4700 Sfmt 4700 (3) Grandfather provision. Paragraphs (a)(1)(i)(N)(1) and (2) of this section do not apply to a limited access NE multispecies permit or CPH if held on April 7, 2011. Any additional limited access NE multispecies permit or CPH that a person acquires after April 7, 2011, are subject to the accumulation limits specified within this section. (4) Any person can be issued one limited access NE multispecies permit or CPH that results in that person’s total PSC exceeding the PSC limit as described in this section. That person must identify to NMFS on or before March 31 of each year, vessel permits or CPH that will be rendered unusable the upcoming fishing year so that the person’s total PSC for the upcoming fishing year is an amount equal to or below the PSC limit. Beginning on May 1, the permits or CPH rendered unusable may not be fished, leased, or enrolled in a sector by that person for the remainder of the fishing year, but may be transferred by that person. The transfer of a permit or CPH rendered unusable shall be made through an arm’s-length transaction (for example, to an independent and unrelated entity that does not share an ownership interest with that person). * * * * * (c) * * * (2) Vessel permit information requirements. (i) An application for a permit issued under this section, in addition to the information specified in paragraph (c)(1) of this section, also must contain at least the following information, and any other information required by the Regional Administrator: Vessel name, owner name or name of the owner’s authorized representative, mailing address, and telephone number; USCG documentation number and a copy of the vessel’s current USCG documentation or, for a vessel not required to be documented under title 46 U.S.C., the vessel’s state registration number and a copy of the current state registration; a copy of the vessel’s current party/charter boat license (if applicable); home port and principal port of landing, length overall, GRT, NT, engine horsepower, year the vessel was built, type of construction, type of propulsion, approximate fish hold capacity, type of fishing gear used by the vessel, number of crew, number of party or charter passengers licensed to be carried (if applicable), permit category; if the owner is a corporation, a copy of the current Certificate of Incorporation or other corporate papers showing the date of incorporation and the names of the current officers of the corporation, and the names and E:\FR\FM\21APR1.SGM 21APR1 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations addresses of all persons holding any ownership interest in a NE multispecies permit or CPH or shareholders owning 25 percent or more of the corporation’s shares for other fishery permits; if the owner is a partnership, a copy of the current Partnership Agreement and the names and addresses of all partners; permit number of any current or, if expired, previous Federal fishery permit issued to the vessel. * * * * * ■ 4. In § 648.14: ■ a. Add paragraphs (k)(2)(v) and (vi); ■ b. Revise paragraph (k)(9)(i); and ■ c. Add paragraph (k)(9)(ii)(N). The additions and revisions read as follows: § 648.14 Prohibitions. * * * * * (k) * * * (2) * * * (v) Fish for, possess, land fish, enroll in a sector, or lease a permit or confirmation of permit history (CPH) as a lessor or lessee, with a permit that has been rendered unusable as specified in § 648.4(a)(1)(i)(N). (vi) Acquire a limited access NE multispecies permit that would result in a permit holder exceeding any of the ownership accumulation limits specified in § 648.4(a)(1)(i)(N), unless authorized under § 648.4(a)(1)(i)(N). * * * * * (9) * * * (i) If operating under the provisions of a limited access NE multispecies Handgear A permit south of the GOM Regulated Mesh Area, as defined at § 648.80(a)(1), fail to declare the vessel operator’s intent to fish in this area via VMS or fail to obtain or retain on board a letter of authorization from the Regional Administrator, as required by § 648.82(b)(6)(iii). * * * * * (ii) * * * (N) Act as a lessor or lessee of NE multispecies DAS to or from a limited access permit that has been rendered unusable as specified in § 648.4(a)(1)(i)(N). * * * * * ■ 5. In § 648.82, revise paragraphs (b)(6) and (g) to read as follows: § 648.82 Effort control program for NE multispecies limited access vessels. nlaroche on DSK30NT082PROD with RULES * * * * * (b) * * * (6) Handgear A category. A vessel qualified and electing to fish under the Handgear A category, as described in § 648.4(a)(1)(i)(A), may retain, per trip, up to 300 lb (135 kg) of cod, one Atlantic halibut, and the daily VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 possession limit for other regulated species and ocean pout, as specified under § 648.86. If either the GOM or GB cod trip limit applicable to a vessel fishing under a NE multispecies DAS permit, as specified in § 648.86(b)(1) and (2), respectively, is reduced below 300 lb (135 kg) per DAS by NMFS, the cod trip limit specified in this paragraph (b)(6) shall be adjusted to be the same as the applicable cod trip limit specified for NE multispecies DAS permits. For example, if the GOM cod trip limit for NE multispecies DAS vessels was reduced to 250 lb (113.4 kg) per DAS, then the cod trip limit for a vessel issued a Handgear A category permit that is fishing in the GOM Regulated Mesh Area would also be reduced to 250 lb (113.4 kg). Qualified vessels electing to fish under the Handgear A category are subject to the following restrictions: (i) The vessel must not use or possess on board gear other than handgear while in possession of, fishing for, or landing NE multispecies; (ii) Tub-trawls must be hand-hauled only, with a maximum of 250 hooks; and (iii) Declaration. For any such vessel that is not required to use VMS pursuant to § 648.10(b)(4), to fish for GB cod south of the GOM Regulated Mesh Area, as defined at § 648.80(a)(1), a vessel owner or operator must obtain, and retain on board, a letter of authorization from the Regional Administrator stating an intent to fish south of the GOM Regulated Mesh Area and may not fish in any other area for a minimum of seven consecutive days from the effective date of the letter of authorization. For any such vessel that is required, or elects, to use VMS pursuant to § 648.10(b)(4), to fish for GB cod south of the GOM Regulated Mesh Area, as defined at § 648.80(a)(1), a vessel owner or operator must declare an intent to fish south of the GOM Regulated Mesh Area on each trip through the VMS prior to leaving port, in accordance with instructions provided by the Regional Administrator. Such vessels may transit the GOM Regulated Mesh Area, as defined at § 648.80(a)(1), provided that their gear is stowed and not available for immediate use as defined in § 648.2. * * * * * (g) Spawning season restrictions. A vessel issued a valid Small Vessel category permit specified in paragraph (b)(5) of this section, or a vessel issued an open access Handgear B permit, as specified in § 648.88(a), may not fish for, possess, or land regulated species or ocean pout from March 1 through March PO 00000 Frm 00029 Fmt 4700 Sfmt 4700 18715 20 of each year. A common pool vessel must declare out and be out of the NE multispecies DAS program, and a sector must declare that the vessel will not fish with gear capable of catching NE multispecies (i.e., gear that is not defined as exempted gear under this part), for a 20-day period between March 1 and May 31 of each calendar year, using the notification requirements specified in § 648.10. A vessel fishing under a Day gillnet category designation is prohibited from fishing with gillnet gear capable of catching NE multispecies during its declared 20-day spawning block, unless the vessel is fishing in an exempted fishery, as described in § 648.80. If a vessel owner has not declared and been out of the fishery for a 20-day period between March 1 and May 31 of each calendar year on or before May 12 of each year, the vessel is prohibited from fishing for, possessing or landing any regulated species, ocean pout, or non-exempt species during the period from May 12 through May 31. * * * * * ■ 6. In § 648.87, revise paragraph (c)(2)(i) introductory text to read as follows: § 648.87 Sector allocation. * * * * * (c) * * * (2) * * * (i) Regulations that may not be exempted for sector participants. The Regional Administrator may not exempt participants in a sector from the following Federal fishing regulations: Specific times and areas within the NE multispecies year-round closure areas; permitting restrictions (e.g., vessel upgrades, etc.); gear restrictions designed to minimize habitat impacts (e.g., roller gear restrictions, etc.); reporting requirements; and AMs specified in § 648.90(a)(5)(i)(D). For the purposes of this paragraph (c)(2)(i), the DAS reporting requirements specified in § 648.82, the SAP-specific reporting requirements specified in § 648.85, VMS requirements for Handgear A category permitted vessels as specified in § 648.10, and the reporting requirements associated with a dockside monitoring program are not considered reporting requirements, and the Regional Administrator may exempt sector participants from these requirements as part of the approval of yearly operations plans. For the purpose of this paragraph (c)(2)(i), the Regional Administrator may not grant sector participants exemptions from the NE multispecies year-round closures areas defined as Essential Fish Habitat Closure Areas as defined in E:\FR\FM\21APR1.SGM 21APR1 18716 Federal Register / Vol. 82, No. 76 / Friday, April 21, 2017 / Rules and Regulations § 648.81(h); the Fippennies Ledge Area as defined in paragraph (c)(2)(i)(A) of this section; Closed Area I and Closed Area II, as defined in § 648.81(a) and (b), respectively, during the period February 16 through April 30; and the Western GOM Closure Area, as defined at § 648.81(e), where it overlaps with GOM Cod Protection Closures I through III, as defined in § 648.81(f)(4). This list may be modified through a framework adjustment, as specified in § 648.90. * * * * * ■ 7. In § 648.90, revise paragraphs (a)(2)(i) through (iii) to read as follows: § 648.90 NE multispecies assessment, framework procedures and specifications, and flexible area action system. nlaroche on DSK30NT082PROD with RULES * * * * * (a) * * * (2) Biennial review. (i) At a minimum, the NE multispecies PDT shall meet on or before September 30 every other year to perform a review of the fishery, using the most current scientific information available provided primarily from the NEFSC. Data provided by states, ASMFC, the USCG, and other sources may also be considered by the PDT. The PDT shall review available data pertaining to: Catch and landings, discards, DAS allocations, DAS use, sector operations, and other measures of fishing effort; survey results; stock status; current estimates of fishing mortality and overfishing levels; social and economic impacts; enforcement issues; and any other relevant information. The PDT may also review the performance of different user groups or fleet sectors. (ii) Based on this review, the PDT shall recommend ACLs for the upcoming fishing year(s), as described in paragraph (a)(4) of this section, and develop options for consideration by the Council, if necessary, on any changes, adjustments, or additions to DAS allocations, closed areas, or other measures necessary to rebuild overfished stocks and achieve the FMP goals and objectives, which may include a preferred option. The range of options developed by the PDT may include any of the management measures in the FMP, including, but not limited to: ACLs, which must be based on the projected fishing mortality levels required to meet the goals and objectives outlined in the FMP for the 12 regulated species and ocean pout if able to be determined; identifying and distributing ACLs and other subcomponents of the ACLs among various segments of the fishery; AMs; DAS changes; possession limits; gear restrictions; closed areas; permitting restrictions; minimum fish sizes; VerDate Sep<11>2014 13:51 Apr 20, 2017 Jkt 241001 recreational fishing measures; describing and identifying EFH; fishing gear management measures to protect EFH; designating habitat areas of particular concern within EFH; and changes to the SBRM, including the CVbased performance standard, the means by which discard data are collected/ obtained, fishery stratification, the process for prioritizing observer sea-day allocations, reports, and/or industryfunded observers or observer set aside programs. The PDT must demonstrate through analyses and documentation that the options it develops are expected to meet the FMP goals and objectives. (iii) In addition, the PDT may develop ranges of options for any of the management measures in the FMP and the following conditions that may be adjusted through a framework adjustment to achieve FMP goals and objectives including, but not limited to: Revisions to DAS measures, including DAS allocations (such as the distribution of DAS among the four categories of DAS), future uses for Category C DAS, and DAS baselines, adjustments for steaming time, etc.; accumulation limits due to a permit buyout or buyback; modifications to capacity measures, such as changes to the DAS transfer or DAS leasing measures; calculation of area-specific ACLs (including sub-ACLs for specific stocks and areas (e.g., Gulf of Maine cod)), area management boundaries, and adoption of area-specific management measures including the delineation of inshore/offshore fishing practices, gear restrictions, declaration time periods; sector allocation requirements and specifications, including the establishment of a new sector, the disapproval of an existing sector, the allowable percent of ACL available to a sector through a sector allocation, an optional sub-ACL specific to Handgear A permitted vessels, and the calculation of PSCs; sector administration provisions, including at-sea and dockside monitoring measures; sector reporting requirements; state-operated permit bank administrative provisions; measures to implement the U.S./Canada Resource Sharing Understanding, including any specified TACs (hard or target); changes to administrative measures; additional uses for Regular B DAS; reporting requirements; declaration requirements pertaining to when and what time period a vessel must declare into or out of a fishery management area; the GOM Inshore Conservation and Management Stewardship Plan; adjustments to the Handgear A or B permits; gear requirements to improve selectivity, PO 00000 Frm 00030 Fmt 4700 Sfmt 4700 reduce bycatch, and/or reduce impacts of the fishery on EFH; SAP modifications; revisions to the ABC control rule and status determination criteria, including, but not limited to, changes in the target fishing mortality rates, minimum biomass thresholds, numerical estimates of parameter values, and the use of a proxy for biomass may be made either through a biennial adjustment or framework adjustment; changes to the SBRM, including the CV-based performance standard, the means by which discard data are collected/obtained, fishery stratification, the process for prioritizing observer sea-day allocations, reports, and/or industry-funded observers or observer set aside programs; and any other measures currently included in the FMP. * * * * * [FR Doc. 2017–08035 Filed 4–20–17; 8:45 am] BILLING CODE 3510–22–P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 665 [Docket No. 160422356–7283–02] RIN 0648–XE587 Pacific Island Fisheries; 2016 Annual Catch Limits and Accountability Measures National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Final specifications. AGENCY: In this final rule, NMFS specifies the 2016 annual catch limits (ACLs) for Pacific Island bottomfish, crustacean, precious coral, and coral reef ecosystem fisheries, and accountability measures (AMs) to correct or mitigate any overages of catch limits. The final ACLs and AMs are effective for fishing year 2016. The fishing year for each fishery begins on January 1 and ends on December 31, except for precious coral fisheries, which begin July 1 and end on June 30 the following year. Although the 2016 fishing year has ended for most stocks, we will evaluate 2016 catches against these final ACLs when data become available in mid-2017. The ACL and AM specifications support the long-term sustainability of fishery resources of the U.S. Pacific Islands. DATES: The final specifications are effective May 22, 2017. The final SUMMARY: E:\FR\FM\21APR1.SGM 21APR1

Agencies

[Federal Register Volume 82, Number 76 (Friday, April 21, 2017)]
[Rules and Regulations]
[Pages 18706-18716]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-08035]



[[Page 18706]]

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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 648

[Docket No. 150630567-7360-02]
RIN 0648-BF26


Magnuson-Stevens Fishery Conservation and Management Act 
Provisions; Fisheries of the Northeastern United States; Northeast 
Groundfish Fishery; Amendment 18

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This final rule implements Amendment 18 to the Northeast 
Multispecies Fishery Management Plan. The New England Fishery 
Management Council developed Amendment 18 to promote fleet diversity 
and in the groundfish fishery, prevent the acquisition of excessive 
shares of permits, and enhance sector management. This action limits 
the number of permits and annual groundfish allocation that an entity 
can hold. This action also removes several effort restrictions to 
increase operational flexibility for fishermen on limited access 
handgear vessels.

DATES: This rule is effective May 22, 2017, except for the amendments 
to Sec. Sec.  648.82(b) and 648.87(c), which will be effective on May 
1, 2017.

ADDRESSES: Copies of Amendment 18, including the Environmental Impact 
Statement, the Regulatory Impact Review, and the Initial Regulatory 
Flexibility Analysis prepared in support of the proposed rule are 
available from Thomas A. Nies, Executive Director, New England Fishery 
Management Council, 50 Water Street, Mill 2, Newburyport, MA 01950. The 
supporting documents are also accessible via the Internet at: http://www.nefmc.org/management-plans/northeast-multispecies or http://www.greateratlantic.fisheries.noaa.gov/sustainable/species/multispecies.
    A copy of the record of decision for the Final Environmental Impact 
Statement can be obtained from the NOAA Fisheries Greater Atlantic 
Regional Fisheries Office, 55 Great Republic Drive, Gloucester, MA 
01930.
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in this 
final rule may be submitted to the Greater Atlantic Regional Fisheries 
Office (address above) or the Office of Management and Budget by email 
OIRA_Submission@omb.eop.gov, or fax to (202) 395-7285.

FOR FURTHER INFORMATION CONTACT: William Whitmore, Fishery Policy 
Analyst, phone: 978-281-9182; email: William.Whitmore@noaa.gov.

SUPPLEMENTARY INFORMATION: 

Background

    This action approves and implements the management measures in 
Amendment 18 to the Northeast (NE) Multispecies Fishery Management Plan 
(FMP). The measures for this action were explained in a notice of 
availability published on December 6, 2016 (81 FR 87862), and a 
proposed rule that published on December 20, 2016 (81 FR 92761). NMFS 
approved Amendment 18 on March 6, 2017.

Summary of Approved Measures

1. Accumulation Limits

Accumulation Limit Guidelines
    Amendment 18 includes several general measures detailing how permit 
accumulation limits are applied.
     Accumulation limits apply to individuals, permit banks, 
and other entities, including groundfish sectors, at the individual 
permit and potential sector contribution (PSC) level.
     Accumulation limits do not apply to the amount of annual 
groundfish allocated to a sector, technically referred to as a sector's 
annual catch entitlement, or ACE.
     Accumulation limits may be modified in a future framework 
due to changes from a Federal permit buyback or buyout.
     If an entity held permits or PSC on the control date 
(April 7, 2011) that exceed the accumulation limits, it is exempt from 
the accumulation limit, but is restricted to holding no more permits or 
PSC than it held as of the control date. The grandfathered holdings may 
be fished or leased by the entity but are not transferrable. Current 
analyses show that no entity exceeds the control date accumulation 
limits.
     There is no calculation of partial ownership when 
considering accumulation limits. Any entity that is a partial owner is 
assumed to have full-ownership when calculating permit and PSC 
accumulation limits.
Excessive Shares
    This action imposes accumulation limits to prevent the acquisition 
of excessive shares. For Amendment 18 analyses purposes, an excessive 
share of fishing privileges was interpreted as a share of PSC that 
would allow an entity to influence the market to its advantage (i.e., 
exert market power). Based on this analysis, it was determined that no 
entity currently holds excessive shares. Also, analysis showed that the 
accumulation limits and the associated measures established in this 
action should sufficiently prevent an entity from acquiring an 
excessive share of fishing permits and exerting market power over the 
fishery. The limits were also designed, though, to avoid placing 
adverse impacts on fishing entities that would reduce operational 
flexibility and market efficiency.
Limiting the Number of Permits
    This action limits an entity to holding no more than 5 percent of 
all limited access groundfish permits. An entity is prohibited from 
acquiring a permit that would result in it exceeding the 5-percent 
permit cap. As of February 21, 2017, there were 1,335 limited access 
permits in the fishery; a 5-percent cap would limit an entity to 67 
permits. The most permits held by any entity was 50. Based on this 
information, this permit cap is unlikely to immediately restrict any 
entity.
Limiting the Potential Sector Contribution
    This action also limits an entity to holding no more than an 
aggregated average of all allocated groundfish stocks to 15.5 PSC. With 
15 groundfish stocks currently allocated to the fishery, the total PSC 
across all stocks used by an individual or an entity can be no more 
than 232.5 (an average PSC of 15.5 percent per stock multiplied by 15 
stocks). This allows an entity to hold PSC for a single stock in excess 
of 15.5 percent, so long as the total holdings used do not exceed 
232.5. If the number of allocated groundfish stocks increases or 
decreases in the future, then this aggregate number (232.5) would 
increase or decrease by 15.5 per stock. As of February 21, 2017, no 
entity holds more than 141 PSC. Based on this information, the PSC 
limit is unlikely to immediately restrict any entity.
    Compared to other PSC limits that the Council considered, this 
option is the least restrictive because there is no stock-specific 
limit. Further, an entity would be permitted to purchase a vessel 
permit during a fishing year that would result in exceeding the 
aggregate 232.5 PSC limit. In this case, the entity must render at 
least one permit unusable (or ``shelve'' the permit) so that the entity 
is not operating above the PSC limit the following fishing year. Any 
permit that is shelved may not be enrolled in a sector, fished, or 
leased, but could be sold. An entity is prohibited from

[[Page 18707]]

purchasing additional permits once it exceeds the PSC limit. This is 
intended to provide operational flexibility for permit holders while 
still restricting them to the overall accumulation limit. This measure 
balances restrictions that are expected to sufficiently prevent 
excessive shares while avoiding adverse effects on market efficiency 
and flexibility.
    Additional information on these accumulation limits is available in 
the Amendment 18 environmental impact statement and the proposed rule.
Effect of Combined Accumulation Limits
    The combination of the PSC limit and 5 percent permit cap raises 
the difficulty and cost of acquiring enough permits and PSC for any one 
entity in the groundfish fishery to exert market power over the 
fishery. Analyses in Amendment 18 conclude that no entity currently has 
an excessive share of permits. Analyses also show that the maximum 
allocation an entity could acquire would be around 20 PSC for the 
majority of stocks, though PSC for certain stocks, such as Georges Bank 
winter flounder, could be acquired at higher levels than other stocks. 
Any payoff from obtaining excessive shares would not be realized for 
many years, if at all. Therefore, the combination of an aggregate PSC 
limit of 232.5 and a 5-percent permit cap should be sufficient to 
prevent market power from being exerted.
Transfer of Permits by an Individual Entity That Has Exceeded the PSC 
Limit
    We expressed concern in the proposed rule that Amendment 18 does 
not include permit transfer restrictions on an individual entity that 
has exceeded the permit accumulation limit. We determined this could 
potentially create an unintended loophole that would allow transfers to 
related parties. Such transfers could result in family members 
controlling permits or PSC in excess of the limits. We argued this was 
inconsistent with the Council's intent for Amendment 18 to limit an 
entity's holdings to a level that would prevent exerting market power. 
We requested public comment on a restriction we proposed that would 
require permit transfers from an entity with a PSC greater than the PSC 
limit to be made via an ``arm's-length'' transaction. For example, an 
arm's-length transaction would be a permit transfer in the ordinary 
course of business between independent and unrelated entities, which 
would result in the owner who exceeded the limit maintaining no 
interest in or control over the transferred permit and its PSC.
    We view this restriction to be consistent with the Council's intent 
and the goals and objectives for the Amendment. This measure also 
improves the enforceability of the PSC accumulation limit. As a result, 
using our authority under section 305(d) of the Magnuson-Stevens 
Fishery Conservation and Management Act (Magnuson-Stevens Act), we are 
adding regulations to require that a permit transfer for individuals 
that have exceeded the accumulation limit to be by an arm's-length 
transaction.
Future Changes to Accumulation Limits
    Accumulation limits can be modified through a future framework 
adjustment if a vessel/permit buyback or buyout were enacted in the 
groundfish fishery. However, any other changes to the accumulation 
limits would require an amendment to the FMP. We encourage the Council 
to revisit the accumulation limits established in this Amendment if 
unanticipated developments adversely affect the goals and objectives of 
this Amendment. For example, a substantial reduction in the number of 
NE multispecies limited access permits (due to permit holders 
relinquishing their permits) could dramatically reduce the permit cap.
Ownership Interest
    In order for an accumulation limit to be developed and applied, it 
is necessary to first define the ownership interest that will be 
limited. A unique definition of ownership interest as applied to the 
groundfish fishery is added in section 50 CFR 648.2 of the regulations. 
To identify ownership interests and account for accumulation limits in 
the groundfish fishery, a permit holder is required to identify all 
persons who hold an ownership interest in a particular permit when 
submitting a groundfish permit application or renewal form for that 
permit.

2. Handgear A Measures

    To reduce effort controls and increase flexibility for small boat 
fishermen, this action removes or modifies several management measures 
affecting limited access permitted handgear vessels (Handgear A 
vessels).
    First, this action removes the March 1-20 spawning-block closure 
for all Handgear A vessels. Fishing effort by Handgear A vessels is 
restricted by a very small annual catch limit, and vessels are subject 
to other spawning closures. This measure makes the regulations for 
Handgear A vessels more consistent with vessels fishing in sectors, 
which account for most of the groundfish fishing effort and are already 
exempt from the 20-day spawning block. This measure is not anticipated 
to have any substantial biological consequences and will provide 
additional fishing opportunities for Handgear A vessels.
    Handgear A vessels are no longer required to carry a standard fish 
tote on board. This requirement was initially implemented to aid in the 
sorting and weighing of fish by both fishermen and enforcement 
personnel. However, enforcement no longer uses totes for at-sea weight 
and volume estimates, so the requirement for vessels to carry a tote is 
no longer necessary.
    Lastly, this action allows a sector to request an exemption from 
the requirement for Handgear A vessels to use a Vessel Monitoring 
System (VMS). Handgear A fishermen enrolled in a sector are currently 
required to utilize a VMS; however, installing and utilizing a VMS 
system makes enrolling in a sector cost prohibitive for these small 
vessels. Any sector interested in utilizing this exemption is required 
to submit an exemption request to us for approval. If a sector 
exemption were approved, a Handgear A vessel fishing within a sector 
utilizing the exemption would declare its trips through the interactive 
voice response call-in system instead of through a VMS. This measure is 
intended to encourage Handgear A vessels to enroll in a sector by 
reducing operating expenses. Sectors receive regulatory exemptions and 
larger allocations that could provide additional flexibility and 
fishing opportunities to Handgear A vessels.

Measures That Can Be Addressed in a Future Framework

    This action allows two measures analyzed in Amendment 18 to be 
implemented through a future framework action. The Council explored 
establishing a separate, optional allocation for the Handgear A 
fishery. Additionally, there was some interest in considering separate 
management measures for an inshore/offshore Gulf of Maine (GOM) 
boundary, including separate allocations for inshore and offshore GOM 
cod. However, because current catch limits for key groundfish stocks, 
including GOM cod, are so low, further sub-dividing allocations for 
Handgear A, as well as inshore and offshore GOM cod, were controversial 
and would be difficult to develop and implement at this time. As a 
result, the Council elected to potentially consider these measures in a 
future framework.
    In addition, several regulatory clarifications are included at 
Sec.  648.90 to

[[Page 18708]]

better delineate the responsibilities of the groundfish plan 
development team (PDT) as well as which Council management measures 
could be modified in a future framework.

Comments and Responses on Amendment 18 and the Measures Proposed in the 
Amendment 18 Proposed Rule

    We received 15 comments during the public comment period on the 
Amendment 18 proposed rule. We specifically requested comments on the 
Council's proposed measures in Amendment 18 and whether they are 
consistent with the NE Multispecies FMP, the Magnuson-Stevens Act and 
its National Standards, and other applicable law. Eight commenters, 
including the Associated Fisheries of Maine (AFM), Environmental 
Defense Fund (EDF), Northwest Atlantic Marine Alliance (NAMA), 
Massachusetts Division of Marine Fisheries (MADMF), Penobscot East 
Resource Center (PERC), Conservation Law Foundation (CLF), and a few 
commercial fishermen wrote in general opposition to the measures 
proposed in Amendment 18. The Northeast Seafood Coalition (NSC) and 
Gloucester Fishermen's Community Preservation Fund (GFCPF) supported 
the Amendment. We consolidated responses to similar comments and our 
responses are below.

Comments on the Amendment 18 Environmental Impact Statement

    Comment 1: One commenter suggested including more details on 
information and opinions expressed by fishing stakeholders during the 
Amendment 18 public meeting sessions. This commenter also suggested 
that the pros and cons of sector management and Amendment 18 be linked 
more clearly.
    Response: Ample information and documentation was available to the 
Council, NMFS, and the public during this decision making process. In 
addition to topical summaries in section 3.4 of Amendment 18, Appendix 
II has a 30-page summary of the public hearings, including both oral 
and written comments on the Amendment. Responses to those public 
comments are included in Appendix III and provide an adequate 
description of stakeholder concerns. Section 7.6.1.2 of Amendment 18 
includes a social impact analysis that reviews the impacts on fishermen 
and fishing communities. The influence and interactions of sector 
management with the groundfish fishery and fishing communities were 
also described in the Compass Lexecon report summarized in the 
Amendment and the proposed rule. This report is also publically 
available online at http://archive.nefmc.org/nemulti/planamen/Amend%2018/compass_lexecon/NEMFC%20Report%20Final.pdf.
    Comment 2: One commenter argued that there is minimal discussion on 
how the accumulation limits and catch caps will affect the future 
viability of the fleet, and that more should be included.
    Response: Analyses of the social and economic impacts of the 
accumulation limits are included in section 7.6.2 of Amendment 18, as 
well as the regulatory impact review, in Section 9.11. These analyses 
include a discussion of both the short and long-term impacts of the 
alternatives, which are also summarized in Table 1 of the Amendment.

Amendment 18 Goals and Objectives

    Comment 3: Many commenters, including those that generally 
supported and opposed the Amendment, argued that the proposed 
management measures would not meet the goals and objectives of 
Amendment 18. The general concern was that consolidation would still 
occur and that fleet diversity would not be promoted as a result.
    Response: Management measures in Amendment 18 do address the goals 
and objectives of the Amendment.
    Accumulation limits address goals 1, 3, and 4 of the Amendment by 
making it unlikely an entity could gain an excessive share of the 
fishery and exert market power over other fishermen and stakeholders. A 
detailed discussion of the goals and objectives was provided in the 
Amendment and the preamble to the proposed rule. The goals and 
objectives include promoting fleet diversity, upholding a resilient and 
stable fishery, and preventing any individual or entity from acquiring 
or controlling an excessive share of the fishery. Amendment 18 
acknowledges that it is likely additional consolidation may occur with 
these accumulation limits in place. However, it is not expected to 
occur to the extent where an entity could acquire an excessive share 
and exert market power over other entities. Curbing consolidation helps 
to maintain diversity even to a limited degree. While other measures 
considered were more restrictive, the measures adopted by the Council 
achieve the goals and objectives. As a result, establishing 
accumulation limits promotes a more diverse and stable groundfish 
fishery. Comments 5-14 below provide a detailed discussion on the 
accumulation limits.
    Measures modifying and removing limited access handgear fishery 
restrictions address goals 1, 2, and 3 within the Amendment.
    Comment 4: Several members of the fishing industry and industry 
organizations contend that increasing operational flexibility, reducing 
business expenses such as at-sea monitoring costs, allocating higher 
and more stable catch limits, reducing input controls, and controlling 
groundfish catch from other fisheries would be more effective 
management measures to address the long-term sustainability of the 
groundfish fleet.
    Response: The Council's intent for Amendment 18 was to develop 
accumulation limits for the groundfish fishery to prevent an entity 
from acquiring an excessive share. This was explained in the Federal 
Register notice that established a control date for such limits (67 FR 
19305; April 7, 2011) and announced at public scoping hearings (76 FR 
79153; December 21, 2011), as well as in the proposed rule for this 
action (81 FR 92763; December 20, 2016). As explained in Comment 3, the 
approved management measures meet the goals and objectives of the 
Amendment.
    The actions suggested by several members of the fishing industry 
could also promote the Amendment 18 goals objectives and are worth 
future consideration by the Council.

Accumulation Limits

    Comment 5: Several commenters were critical of the excessive-shares 
report developed by Compass Lexecon.
    Response: The Council contracted Compass Lexecon to provide an 
independent review of excessive permit shares in the groundfish 
fishery. Preliminary results of the analysis were presented to the 
Council's Groundfish Committee at a number of its meetings so that the 
Committee and the public could comment. The final report was also peer 
reviewed, which allowed for additional opportunities for the public to 
provide input and comment on the analysis. The Council considered the 
final Compass Lexecon report, the peer review reports, public comments 
on the analysis, and other analyses conducted in support of the 
Amendment, when making its decision on Amendment 18 accumulation limit 
alternatives. The peer reviewer reports can be found here at https://www.st.nmfs.noaa.gov/science-quality-assurance/cie-peer-reviews/cie-review-2014.
    Comment 6: Most opponents, including MADMF, CLF, EDF, NAMA, and 
PERC, contend that the proposed accumulation limits are too high and 
will foster further consolidation, which, in turn, reduces fleet 
diversity. Several commenters expressed concern that some entities 
could take advantage of

[[Page 18709]]

low allocations and permit prices to acquire additional permits to 
exert market power over the fishery. On the other hand, supporters of 
the Amendment, such as NSC, argue that the higher accumulation limits 
are necessary to offset constraining quotas, and that a lower 
accumulation limit would have penalized permit holders for what they 
had already acquired.
    Response: Since the approval of Amendment 16 and the expansion of 
sectors in the groundfish fishery, many industry members and 
stakeholders have become increasingly concerned about fleet 
consolidation and the resulting negative impacts on fishing vessels and 
fishing communities. Amendment 18 was developed to address these 
concerns.
    Some fishing industry members and organizations argued for more 
restrictive accumulation limits. Several organizations, such as CLF, 
viewed the establishment of accumulation limits as an opportunity to 
readjust the allocations from Amendment 16. For example, some suggested 
stock-specific PSC limits ranging from 2.5 to 10 PSC, and one commenter 
proposed reducing the permit cap from 5 to 2.5 percent. These limits 
are much more restrictive than the PSC many entities currently have and 
could have adversely affected an entity's ability to adapt to changing 
conditions. Also, limits as restrictive as these could have forced 
divestiture by reallocating PSC from larger businesses to smaller.
    During the development of Amendment 18, annual catch limits for 
many groundfish stocks were significantly reduced. Since there was less 
quota affiliated with each permit, some fishermen acquired more permits 
and PSC to sustain fishing operations and remain viable. Many entities 
and organizations argued that more restrictive accumulation limits 
would have negatively affected many businesses by adversely affecting 
the market for permits and PSC.
    The Council had to balance the need for accumulation limits with 
the need to provide operational flexibility to the fleet. Understanding 
that no entity currently holds an excessive share of the fishery, the 
Council selected the alternative that provides the most operational 
flexibility to the fleet while substantially reducing the risk of an 
entity acquiring an excessive share of permits. If conditions or 
circumstances in the fishery change, the Council can re-visit the 
accumulation limits established through this action if necessary.
    Comment 7: Several commenters provided hypothetical mathematical 
scenarios where entities could acquire large allocations for one or 
more stocks and potentially have an excessive share of permits. For 
example, an entity could acquire a PSC of 50 for stock A, a PSC of 30 
for stock B, a PSC of 30 for stock C, and small allocations of other 
stocks and still be under the PSC limit. Critics contend that this 
would allow an entity to acquire an excessive share.
    Response: While the accumulation limit measures may mathematically 
allow an entity to acquire an excessive share of groundfish permits, it 
is very unlikely this will occur. These ``worst case'' scenarios were 
described in a ``deterministic analysis'' in Amendment 18 (Section 
9.11.1.4.1). This analysis examined how much PSC an entity could 
acquire under the accumulation limits if it were able to purchase the 
permits with the most PSC for a particular stock. For example, an 
entity could acquire either 40 PSC of GOM cod or 73 PSC of Georges Bank 
winter flounder, before reaching an accumulation limit. However, as 
explained in the Amendment and its supporting analyses, the 
deterministic analysis is not necessarily a realistic scenario because 
of the high costs and logistical difficulty of acquiring the specific 
permits that contain the highest PSC for a specific stock that could 
allow an entity to exert market power.
    Amendment 18 also includes a probabilistic analysis, which is a 
model designed to predict the likelihood that an individual could 
strategically acquire permits that have high levels of PSC while 
remaining under the permit cap. The probabilistic analysis concludes 
that this would be very difficult. Under the probabilistic analysis, 
the median accumulation for all stocks was below 20 PSC. The Amendment 
18 economic discussion concludes that the probabilistic analysis is 
much more realistic than the potential PSC limits projected under the 
deterministic analysis. The review also explains that even without the 
accumulation limits, acquiring the necessary permits to hold an 
excessive share would be extremely complex, expensive, and time 
consuming. This may explain why no entity currently holds an excessive 
share of permits, despite years without any limitations.
    The Compass Lexecon report used by the Council to research 
excessive shares in the groundfish fishery also found a substantial 
``competitive fringe'' in several groundfish stocks. A competitive 
fringe is a large group of permit holders who hold a relatively small 
amount of PSC. If the permit holders in the competitive fringe are 
efficient, then they are likely to remain in the fishery and help 
preserve a competitive market structure. In a fishery where there is a 
competitive fringe, an entity could acquire a high PSC of a given stock 
yet be unable to exert market power. The Compass Lexecon report 
concluded that ``an excessive-share cap of about 15 percent would be 
sufficient to ensure low concentration for ACE regardless of the level 
of the competitive fringe. The large competitive fringe for some 
species could allow for a higher share cap, should the [Council] choose 
to recommend separate caps for different species.''
    While the Compass Lexecon recommendation was stock-specific, the 
report did not include a permit cap in addition to the PSC cap. The 
Amendment 18 analyses conclude that combining the PSC limit and permit 
cap should prevent an entity from acquiring an excessive share of 
permits.
    Comment 8: Several commenters, including EDF and CLF, argue the 
Amendment violates National Standards 4 and 8 because the accumulation 
limits do nothing to prevent consolidation of the fleet and do not 
manage fishing access consistent with historical activities.
    Response: We have carefully reviewed the provisions in Amendment 18 
and have determined that the Amendment is consistent with both National 
Standards 4 and 8. Amendment 18 is designed to fairly and equitably 
prevent the acquisition of excessive shares as the fishery 
consolidates. No measures in it are designed to prevent the status quo 
from continuing or an expansion from occurring as stocks recover. By 
putting in place measures designed to prevent the acquisition of 
excessive shares while providing for operational flexibility, this 
action minimizes to the extent practicable the adverse economic effects 
that could accompany such restrictions on the purchase and sales of 
groundfish permits, their PSC, and fishing vessels. An explanation of 
how Amendment 18 meets National Standards 4 and 8 is provided in 
Section 9.1.1 of Amendment 18.
    Amendment 18 suggests that further consolidation is anticipated, 
even with the accumulation limits, but not to the extent where an 
entity could acquire an excessive share of the fishery. Consolidation 
could occur at a greater rate without the accumulation limits 
established through this action. Importantly, the Amendment 18 analysis 
concludes that fishing communities would be worse off if the proposed 
accumulation limits were not implemented because entities would remain 
unconstrained in their ability to acquire permits and PSC, including

[[Page 18710]]

potentially acquiring an excessive share of the fishery. We encourage 
the Council to continue developing additional management measures that 
mitigate fleet consolidation and promote fleet diversity.
    Comment 9: Several commenters, including MADMF, EDF, CLF, and PERC 
suggested that PSC limits should be species or stock-specific instead 
of the aggregate PSC limit adopted in this action. Others, like the 
GFCPF and NSC argued that the PSC limits need to be aggregate because 
groundfish permits include all groundfish stocks and are not severable.
    Response: The Council considered these concerns when developing 
this Amendment. In its report, Compass Lexecon suggested that PSC 
limits should be stock specific. Four of the six PSC limit alternatives 
were stock-specific alternatives. However, proponents of an aggregate 
limit explained that groundfish permits are aggregate permits, with 
each permit containing a PSC for each allocated stock. A stock-specific 
PSC limit would restrict the ability for an entity to acquire 
additional PSC in more than one stock, which is a challenge in a 
multispecies fishery. Because of this, the Council concluded that the 
stock-specific limits may be overly restrictive given the current 
circumstances in the fishery and not necessary at this time. As 
explained above, the Amendment 18 economic analysis concluded that the 
aggregate PSC limit, along with the permit cap, should deter an entity 
from acquiring an excessive share of permits.
    Comment 10: One commenter suggested that accumulation limits should 
include limiting a sector's annual catch entitlement (ACE) at the 
species or stock level.
    Response: The accumulation limits in this action do not apply to a 
sector's ACE. Available analyses show that there is no need for an 
excessive share cap on sector-affiliated ACE because the sectors 
themselves do not control how member vessels use ACE. Since the 
implementation of Amendment 16, each sector has reallocated its ACE to 
its members in a manner consistent with each member's PSC. If a 
groundfish sector were to modify its operations in a manner where it 
began to exercise control over how vessel operators used ACE, it could 
be worthwhile to consider an ACE limit.
    Also, there are no specific regulations that prevent one sector 
from dividing into multiple sectors. If an ACE limit was adopted and a 
sector was at risk of reaching that limit, the members could simply 
break into two separate sectors to avoid the limit, but continue 
operating collaboratively.
    For these reasons, establishing an accumulation limit for sector 
ACE is not necessary at this time and was not included in Amendment 18.
    Comment 11: EDF suggested that fishing associations and permit 
banks should have different PSC caps than individual entities.
    Response: The Council discussed this idea in detail but was never 
able to clearly define a permit bank due to the difficulty of 
identifying and distinguishing different types of owners and permit 
banks. For example, the difference between an individual or 
organization that holds multiple permits and a permit bank is not 
easily defined. Some, such as EDF, argued that non-profits 
(particularly environmental non-government organizations) should have a 
higher PSC limit to promote permit banking operations, while opponents 
were concerned that granting non-profits higher PSC limits could reduce 
fishermen's access to ACE and reduce fishing opportunities and 
landings. Due to these complications, the Council elected not to focus 
on this aspect and selected a single PSC and permit limit for all 
permit holders.
    Comment 12: CLF contends that an entity should not be able to 
exceed the PSC limit and ``shelve'' a permit. It argues that this 
measure would allow an entity to choose which permit to shelve so that 
it could target PSC for a particular species with a higher likelihood 
of achieving market power. CLF also suggested that shelving a permit 
has a similar economic effect on the fishery as fishing it because 
other fishermen are unable to utilize the shelved PSC.
    Response: This measure was selected by the Council because it 
provides fishermen more flexibility when purchasing aggregated 
multispecies permits, for reasons similar to those explained in Comment 
9. The challenge fishermen encounter is that each permit has PSC for 
all groundfish stocks. A fisherman looking to acquire a specific permit 
with a higher PSC in a stock they want or need to target may be unable 
to do so because of PSCs from other stocks on the permit. This measure 
was designed to give fishermen the flexibility to shift target species 
or permits while remaining under the PSC limit. To prevent an entity 
from trying to acquire an excessive share of permits, vessel owners are 
not able to acquire an additional permit if they have shelved a permit. 
The PSC affiliated with a ``shelved'' permit is unusable and is not 
redistributed to the fishery.
    However, we understand some of the concerns expressed by CLF. 
Although the Council was focused on maintaining flexibility, we 
recommend that the Council discuss and reconsider the ability for an 
entity to exceed the PSC limit then ``shelve'' a permit.
    Comment 13: One commenter requested that NMFS specifically codify 
the 5-percent permit cap at 69 permits, which is 5 percent of the 
approximately 1,373 total limited access NE multispecies permits.
    Response: This comment is in direct response to our concern 
expressed in the proposed rule--that an unanticipated dramatic drop in 
limited access permits (due to permit holders relinquishing their 
permits) could substantially reduce the permit cap. For example, when 
Amendment 18 was developed, there were approximately 1,373 limited 
access groundfish permits, which would result in a 5-percent permit cap 
of 69 permits. As of February 21, 2017, there were 1,335 limited access 
groundfish permits, which sets a permit cap at 67 permits. A more 
substantial reduction could greatly reduce the permit cap. As we 
explained in the proposed rule, this issue could be discussed and 
addressed by the Council in a future action, if necessary. We are not 
including regulations specifying a specific number of permits for the 
permit cap because we determined it would not be consistent with the 
Council's intent to limit the degree of consolidation.
    Comment 14: Three commenters supported, and two commenters opposed, 
our suggestion that permit transfers for entities who have exceeded the 
PSC limit and ``shelved'' permits should be transferred via an ``arm's-
length'' transaction. Those commenters in opposition suggested that the 
measure should first be considered and discussed by the Council.
    Response: As explained in the preamble above, the arm's-length 
transaction requirement closes a loophole to the PSC limit restriction. 
Without this additional restriction, a loophole could allow an entity 
to indirectly acquire an excessive share of the fishery through 
collusion of permit holdings. This measure improves the enforceability 
of the PSC accumulation limit and ensures that the limit is a real 
limit, not just a limit on paper. Without the arm's-length transfer 
requirement, an entity could undermine the intent of the accumulation 
limits by transferring a permit to a family member or other entity the 
transferor controls indirectly. The Council did not provide public 
comment on this measure; however, we determined that ensuring the 
limits are

[[Page 18711]]

effective is consistent with the Council's intent and the goals and 
objectives of Amendment 18. For these reasons, we are implementing this 
requirement.

Other Measures

    Comment 15: The Northeast Hook Fishermen's Association wrote in 
support of the Handgear A management measures.
    Response: We agree that these measures will provide additional 
operating flexibility for Handgear A vessels and have approved these 
measures. The Council should continue to consider management measures 
that will provide increased flexibility and additional fishing 
opportunities for handgear vessels.
    Comment 16: Two commenters argued there is a greater need for 
market transparency in the groundfish fishery and urged the Council and 
NMFS to make ACE trade data more transparent. They expressed concern 
that a lack of market and trade information is detrimental to some 
fishermen who may be undervaluing their allocations or unknowingly 
overpaying for quota. It was suggested that trade data could be 
aggregated in a manner so that confidential information is not 
released.
    Response: The Council considered an alternative in Amendment 18 to 
exempt ACE disposition data from confidentiality restrictions. Under 
this alternative, value associated with the movement of ACE within and 
between sectors would have been considered non-confidential and made 
available to the public. Consistent with current data submission 
timeframes, price data on trades made between sectors would have been 
made available during the fishing year. Price data on the movement of 
ACE within sectors would have been made available after the end of the 
fishing year.
    Under the Magnuson-Stevens Act, only data required to be submitted 
to NMFS for a determination in a limited access program can be 
released. The Council did not select this alternative as preferred 
because NMFS determined that ACE price data are not submitted to NMFS 
for a determination in the sector catch-share program, and, therefore, 
may not be released under the Magnuson-Stevens Act data confidentiality 
provisions. Because these data are confidential per the Magnuson-
Stevens Act requirement, neither the Council nor NMFS can release 
pricing behavior and ACE usage at the level of detail requested.
    Comment 17: NAMA and PERC suggested that Amendment 18 should have 
included inshore and offshore management measures for the GOM. These 
groups requested that a short-term task force be established to develop 
inshore and offshore fishery management measures.
    Response: We agree that inshore and offshore management measures 
are worth further consideration. As explained in Amendment 18 and the 
proposed rule for this action, the Council considered, but decided not 
to pursue, development of distinct inshore and offshore fishery 
management measures for vessels fishing in the GOM. The Council spent 
considerable time debating these issues and elected to potentially 
pursue the measures in a future framework adjustment. Requests to 
establish a short-term task force should be brought to the Council and 
its Groundfish Oversight Committee.
    Comment 18: EDF expressed concern that establishing the Redfish 
Exemption Area would increase misreporting and suggested that any 
vessel targeting redfish in an exemption area be required to have 100-
percent monitoring coverage, or be monitored electronically.
    Response: The Council chose not adopt the Redfish Exemption Area in 
Amendment 18. However, groundfish sector vessels have a regulatory 
exemption from minimum mesh size requirements so they can better target 
redfish. A proposed rule soliciting public comment on sector operations 
plans and exemptions for the 2017-2018 fishing years will be published 
in spring 2017. Comments on the Redfish Exemption Area should be made 
through that action.
    Comment 19: Two commenters were critical of how the Council managed 
the public comment process during the development of Amendment 18, 
arguing that the Council often disregards fishermen's concerns. One 
organization wrote in support of the Council process.
    Response: We disagree that the Council mismanaged the public 
comment process. The public had ample opportunities to comment on 
Amendment 18 and its proposed management measures. Amendment 18 was 
developed over several years during dozens of public meetings. All of 
the management measures were developed with public comment. The public 
was able to comment on the scope of the Amendment, review draft and 
final environmental impact statements, critique the Amendment itself, 
and respond to proposed regulations. The Council and NMFS followed 
public comment processes required by the National Environmental Policy 
Act, the Magnuson-Stevens Act, and the Administrative Procedure Act 
(APA).

Changes From the Proposed Rule

    As explained in the preamble of this rule and in Comment 14 above, 
using our authority under section 305(d) of the Magnuson-Stevens Act, 
we added a regulatory measure at 50 CFR 648(a)(1)(i)(N)(4) that 
requires permit transfers for individuals that exceed the accumulation 
limit to be made by an arm's-length transaction. The arm's-length 
requirement was discussed in the preamble of the proposed rule.
    The regulatory text proposed at Sec.  648.4(a)(1)(i)(N) was revised 
to better clarify how the grandfather provision is applied to the 
accumulation limits implemented through this action.

Classification

    Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the 
NMFS Assistant Administrator has determined that the management 
measures implemented in this final rule are necessary for the 
conservation and management of the NE multispecies fishery and 
consistent with the Magnuson-Stevens Act, and other applicable law.
    The Council prepared, and NMFS filed, a final environmental impact 
statement (FEIS) for this action with the Environmental Protection 
Agency (EPA). The EPA published a notice of availability for the FEIS 
on October 14, 2016 (81 FR 71094).
    In approving the Amendment on March 6, 2017, NMFS issued a record 
of decision (ROD) identifying the selected alternative. A copy of the 
ROD is available from NMFS (see ADDRESSES).
    This final rule has been determined to be not significant for 
purposes of Executive Order (E.O.) 12866.
    This final rule does not contain policies with Federalism or 
``takings'' implications as those terms are defined in E.O. 13132 and 
E.O. 12630, respectively.
    This rule includes two regulatory modifications that will increase 
the operational flexibility for Handgear A vessels. Because these 
regulatory changes relieve regulatory restrictions, these measures are 
not subject to the 30-day delayed effectiveness provision of the APA 
pursuant to 5 U.S.C. 553(d)(1). Currently, Handgear A vessels are 
required to carry a standard fish tote on board. Because enforcement no 
longer use totes for at-sea weight and volume estimates, the 
requirement for vessels to carry a tote is unnecessary and is being 
removed. This action also allows a groundfish sector to request an 
exemption from requiring Handgear A vessels to utilize a vessel 
monitoring system (VMS). Currently, all sector

[[Page 18712]]

vessels are required to use a VMS while fishing. Handgear vessels have 
argued that this requirement is cost prohibitive. If an exemption were 
requested and approved, Handgear A vessels enrolled in a sector with 
the exemption would no longer be required to purchase a VMS. This 
measure increases the feasibility for a Handgear A vessel to enroll in 
a sector by reducing its operating expenses.

Final Regulatory Flexibility Analysis

    Section 604 of the Regulatory Flexibility Act (RFA) requires an 
agency to prepare a final regulatory flexibility analysis (FRFA) after 
being required by that section or any other law to publish a general 
notice of proposed rulemaking and when an agency promulgates a final 
rule under section 553 of Title 5 of the U.S. Code. The FRFA describes 
the economic impact of this action on small entities. The FRFA includes 
a summary of significant issues raised by public comments, the analyses 
contained in Amendment 18 and its accompanying FEIS/Regulatory Impact 
Review/Initial Regulatory Flexibility Analysis (IRFA), the IRFA summary 
in the proposed rule, as well as the summary provided below. A 
statement of the necessity for and objectives of this action are 
contained in Amendment 18 and in the preamble to this final rule, and 
is not repeated here. A copy of this analysis is available from the 
Council (see ADDRESSES).

A Summary of the Significant Issues Raised by the Public in Response to 
the IRFA, a Summary of the Agency's Assessment of Such Issues, and a 
Statement of Any Changes Made in the Final Rule as a Result of Such 
Comments

    Our responses to all of the comments received on the proposed rule, 
including those that raised significant issues with the proposed 
action, or commented on the economic analyses summarized in the IRFA 
and below, can be found in the Comments and Responses section of this 
rule. Comment 2 suggested that additional analyses detailing how permit 
caps will affect the future viability of the fleet was needed. Comment 
5 explained that several commenters were critical of an independent 
report and analyses utilized by the Council to develop Amendment 18 
accumulation limits. Comment 6 summarized that most opponents to the 
Amendment contend that the accumulation limits will promote additional 
consolidation and reduced fleet diversity. Detailed responses are 
provided to each of these specific comments and are not repeated here. 
There were no other comments directly related to the IRFA; the Chief 
Counsel for the Office of Advocacy of the Small Business Administration 
(SBA) did not file any comments. No changes to the proposed rule 
measures were necessary as a result of these public comments.

Description and Estimate of the Number of Small Entities to Which This 
Rule Will Apply

    On December 29, 2015, NMFS issued a final rule establishing a small 
business size standard of $11 million in annual gross receipts for all 
businesses primarily engaged in the commercial fishing industry (NAICS 
11411) for Regulatory Flexibility Act (RFA) compliance purposes only 
(80 FR 81194, December 29, 2015). The $11 million standard became 
effective on July 1, 2016, and is to be used in place of the SBA's 
current standards of $20.5 million, $5.5 million, and $7.5 million for 
the finfish (NAICS 114111), shellfish (NAICS 114112), and other marine 
fishing (NAICS 114119) sectors, respectively, of the U.S. commercial 
fishing industry in all NMFS rules subject to the RFA after July 1, 
2016.
    Pursuant to the RFA, and prior to July 1, 2016, an IRFA was 
developed for this regulatory action using SBA's size standards. NMFS 
has reviewed the analyses prepared for this regulatory action in light 
of the new size standard. Under the previously-used SBA's size 
standards, all of the commercial finfish and other marine fishing 
businesses were considered small, while 12 of the 237 shellfish 
businesses were determined to be large (Tables 1 and 2).
    The new standard could result in a few more commercial shellfish 
businesses being considered small. However, taking the size standard 
change into consideration, NMFS has identified no additional 
significant alternatives that accomplish statutory objectives and 
minimize economic impacts of the proposed rule on small entities. 
Further, the new size standard does not affect the decision to prepare 
a FRFA as opposed to a certification for this regulatory action.
    Analyses in Tables 2 and 3 below reveal that no groundfish-
dependent entities exceeded the previous SBA standard of $5.5 million 
in gross sales, with the mean gross sale per entity being less than $2 
million. It is therefore unlikely that any finfish, or more 
specifically, groundfish-dependent vessels, would be considered a large 
business under the new NMFS size standard.
    Amendment 18 regulates commercial fish harvesting entities engaged 
in the NE multispecies limited access fishery. A description of the 
specific entities that are likely to be impacted is included below for 
informational purposes, followed by a discussion of those regulated 
entities likely to be impacted by the proposed regulations. For the 
purposes of the RFA analysis, the ownership entities, not the 
individual vessels, are considered the regulated entities.
    Individually-permitted vessels may hold permits for several 
fisheries, harvesting species of fish that are regulated by several 
different FMPs, even beyond those affected by Amendment 18. 
Furthermore, multiple permitted vessels and/or permits may be owned by 
entities affiliated by stock ownership, common management, identity of 
interest, contractual relationships, or economic dependency. For this 
analysis, ownership entities are defined by those entities with common 
ownership personnel as listed on permit application documentation. Only 
permits with identical ownership personnel are categorized as an 
ownership entity. For example, if five permits have the same seven 
personnel listed as co-owners on their application paperwork, those 
seven personnel form one ownership entity, covering those five permits. 
If one or several of the seven owners also own additional vessels, with 
sub-sets of the original seven personnel or with new co-owners, those 
ownership arrangements are deemed to be separate ownership entities for 
the purpose of this analysis.
    Ownership entities are identified on June 1 of each year based on 
the list of all permit numbers for the most recent complete calendar 
year that have applied for any type of NE Federal fishing permit. At 
the time of the Amendment 18 analyses, the ownership data set was based 
on calendar year 2014 permits and contained gross sales associated with 
those permits for calendar years 2012 through 2014.
    On June 1, 2015, there were 661 commercial business entities 
potentially regulated by this action. Entities permitted to operate in 
the NE multispecies limited access fishery are described in Tables 1 
and 2. As of June 1, 2015, there were 1,147 individual limited access 
permits. The 34 for-hire businesses included here are entities 
affiliated with limited access commercial groundfish permits, but 
derive greater than 50 percent of their gross sales from party/charter 
operations. All are small businesses (average gross revenues from 2012-
14 are less than $7.5 million). The remaining 75 entities had no 
revenue and are classified as small.

[[Page 18713]]

    These totals may mask some diversity among the entities. Many, if 
not most, of these ownership entities maintain diversified harvest 
portfolios, obtaining gross sales from many fisheries and are not 
dependent on any one. However, not all are equally diversified. Those 
that depend most heavily on sales from harvesting species affected 
directly by Amendment 18 are most likely to be affected. By defining 
dependence as deriving greater than 50 percent of gross sales from 
sales of regulated species associated with a specific fishery, those 
ownership groups most likely to be affected by the proposed regulations 
can be identified. Using this threshold, 61 entities are groundfish-
dependent; all of which are small under both the SBA and NMFS size 
standards (Table 3).

               Table 1--Entities Regulated by Amendment 18
------------------------------------------------------------------------
                                                                 Number
                        Type                           Number     small
------------------------------------------------------------------------
Primarily finfish...................................       315       315
Primarily shellfish.................................       237       225
Primarily for-hire..................................        34        34
No Revenue..........................................        75        75
                                                     -------------------
  Total.............................................       661       649
------------------------------------------------------------------------


                                                Table 2--Description of Regulated Entities by Gross Sales
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Mean  gross    Median  gross   Mean permits     Max permits
                     Sales category                           Number       Number  small       sales           sales        per entity      per entity
--------------------------------------------------------------------------------------------------------------------------------------------------------
<$50K...................................................             186             186         $10,597          $1,954             1.3              30
50-100K.................................................              71              71          76,466          78,736             1.3               3
100-500K................................................             225             225         244,672         219,731             1.3               4
500K-1mil...............................................              91              91         734,423         720,668             1.7               7
1-5.5mil................................................              74              73       1,899,461       1,498,138             2.4              11
5.5mil+.................................................              14               3      11,900,790       7,383,522            12.4              28
--------------------------------------------------------------------------------------------------------------------------------------------------------


                             Table 3--Impacted Groundfish-Dependent Regulated Commercial Groundfish Entities by Gross Sales
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Average
                                                                              fishing      Maximum       Median                    Median        Mean
                                                     Entities     Large       permits      fishing       gross     Mean  gross   groundfish   groundfish
                       Sales                         (number)   businesses   owned  per    permits     sales  per   sales  per   sales  per   sales  per
                                                                 (number)      entity     per entity     entity       entity       entity       entity
                                                                              (number)     (number)
--------------------------------------------------------------------------------------------------------------------------------------------------------
<$50K.............................................          6            0          1.0            1      $10,116      $20,316       $8,831      $16,476
50-100K...........................................          7            0          1.1            2       72,052       67,390       56,221       49,341
100-500K..........................................         22            0          1.6            4      226,938      240,833      116,018      172,331
500K-1mil.........................................         13            0          1.2            2      698,226      718,231      398,548      491,838
1-5.5mil..........................................         13            0          2.2            4    1,553,597    1,854,052    1,292,445    1,403,896
                                                   -----------------------------------------------------------------------------------------------------
    Total ownership entities......................         61            0  ...........  ...........  ...........  ...........  ...........  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------

Description of Projected Reporting, Record Keeping, and Other 
Compliance Requirements

    This final rule contains a collection-of-information requirement 
subject to the Paperwork Reduction Act (PRA) and which is under review 
by OMB under control number 0648-0202. This revision requires any 
entity that has exceeded the PSC limit to render one or more permits 
``unusable'' so that the entity would be operating within the 
allocation limit. If an entity exceeds the PSC limit, the entity would 
be required to complete a ``Permit Shelving Form'' and render one or 
more permits unusable.
    Public reporting burden for the permit shelving form is estimated 
to average 30 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. If two entities had to complete a ``Permit 
Shelving Form,'' the burden estimate would be 1 hr and cost $1. 
Currently, no entity exceeds the PSC allocation limit; the most PSC any 
entity holds is approximately 140 PSC, and the limit is 232.5 PSC. As a 
result, it is unlikely that any entity would reach this threshold, or 
that this action would directly affect fishing operations.
    Send comments regarding these burden estimates or any other aspect 
of this data collection, including suggestions for reducing the burden, 
to NMFS (see ADDRESSES) and by email to OIRA_Submission@omb.eop.gov, or 
fax to 202-395-7285.
    Notwithstanding any other provision of the law, no person is 
required to respond to, and no person shall be subject to penalty for 
failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB control number.

Description of the Steps the Agency Has Taken To Minimize Significant 
Economic Impact on Small Entities Consistent With the Stated Objectives 
of Applicable Statutes

    This FRFA is intended to analyze how small entities would be 
affected by the Amendment 18 management measures. This action is 
expected to have minimal, if any, impact on regulated small entities. 
The vast majority (649 out of 661) of potentially regulated entities 
are classified as small businesses by SBA and NMFS business size 
standards.
    In general, the small entities regulated by this action will be 
unaffected. The majority of limited access groundfish permit holders 
possess permits and PSC in far smaller quantities than the proposed 
accumulation limits. However, individuals who comprise a part of, or 
the entirety of, these small entities could be restricted in the number 
of permits or the amount of PSC shares they wish to accumulate in the 
future, which could affect potential revenue.

[[Page 18714]]

    The PSC limit alternative that was selected for this action 
provided the most flexibility of all the alternatives proposed. Vessel 
permit holders can continue to accumulate permits in a manner that 
allows them to maximize fishing opportunities within their portfolio.
    Several stock-specific PSC limit alternatives considered in the 
Amendment were not selected because the Council determined the 
alternatives would have been too restrictive. For example, limiting an 
ownership entity to an accumulation limit equivalent to the PSC held as 
of the control date could have forced divestiture in the fishery and 
would have prevented ownership entities from growing. Similarly, 
establishing a specific accumulation limit for a specific groundfish 
stock could have reduced opportunities for entities to expand into 
other fisheries and restrict operational flexibility. Additional 
information on these alternatives is available in section 4.1 of the 
Amendment.
    Handgear A permit holders will be largely unaffected by the limited 
access handgear measures. As explained in the preamble, the Handgear A 
management measures approved in this action actually remove regulatory 
restrictions, increasing operational flexibility and fishing 
opportunities.
    Several management measures and alternatives were considered but 
not selected by the Council. Other alternatives may be considered in a 
future framework, as explained in the preamble above. Additional 
information on these alternatives and justifications for the Council's 
decision are explained in section 4 of the Amendment.

Small Entities Compliance Guide

    Section 212 of the Small Business Regulatory Enforcement Fairness 
Act of 1996 states that, for each rule or group of related rules for 
which an agency is required to prepare a FRFA, the agency shall publish 
one or more guides to assist small entities in complying with the rule, 
and shall designate such publications as ``small entity compliance 
guides.'' The agency shall explain the actions a small entity is 
required to take to comply with a rule or group of rules. As part of 
this rulemaking process, a letter to permit holders that also serves as 
small entity compliance guide (the guide) was prepared. Copies of this 
final rule are available from the Greater Atlantic Regional Fisheries 
Office, and the guide, (i.e., bulletin), will be sent to all holders of 
permits for the NE multispecies fishery. The guide and this final rule 
will be available upon request.

List of Subjects in 50 CFR Part 648

    Fisheries, Fishing, Reporting and recordkeeping requirements.

    Dated: April 17, 2017.
Alan D. Risenhoover,
Acting Deputy Assistant Administrator for Regulatory Programs, National 
Marine Fisheries Service.

    For the reasons stated in the preamble, NMFS amends 50 CFR part 648 
as follows:

PART 648--FISHERIES OF THE NORTHEASTERN UNITED STATES

0
1. The authority citation for part 648 continues to read as follows:

    Authority: 16 U.S.C. 1801 et seq.


0
2. In Sec.  648.2, add a definition for ``Ownership interest'' in 
alphabetical order to read as follows:


Sec.  648.2  Definitions.

* * * * *
    Ownership interest, in the NE multispecies fishery, includes, but 
is not limited to holding share(s) or stock in any corporation, any 
partnership interest, or membership in a limited liability company, or 
personal ownership, in whole or in part, of a vessel issued a limited 
access NE multispecies permit or confirmation of permit history (CPH), 
including any ownership interest in any entity or its subsidiaries or 
partners, no matter how far removed.
* * * * *

0
3. In Sec.  648.4, add paragraph (a)(1)(i)(N) and revise paragraph 
(c)(2)(i) to read as follows:


Sec.  648.4  Vessel permits.

    (a) * * *
    (1) * * *
    (i) * * *
    (N) Accumulation limits--(1) 5-percent permit/CPH restriction. Any 
person with an ownership interest in the NE multispecies fishery is not 
eligible to be issued a limited access NE multispecies permit or CPH 
for a vessel if the issuance results in the person having an ownership 
interest in excess of 5 percent of all limited access NE multispecies 
permits and CPH that are issued as of the date the permit/CPH 
application is received by the NMFS.
    (2) PSC limit. Any person with an ownership interest in the NE 
multispecies fishery is not eligible to be issued a limited access NE 
multispecies permit or CPH for a vessel that results in that person's 
average potential sector contribution (PSC) exceeding a share of 15.5 
for all the allocated stocks in aggregate, except as provided in 
paragraph (a)(1)(i)(N)(4) of this section.
    (3) Grandfather provision. Paragraphs (a)(1)(i)(N)(1) and (2) of 
this section do not apply to a limited access NE multispecies permit or 
CPH if held on April 7, 2011. Any additional limited access NE 
multispecies permit or CPH that a person acquires after April 7, 2011, 
are subject to the accumulation limits specified within this section.
    (4) Any person can be issued one limited access NE multispecies 
permit or CPH that results in that person's total PSC exceeding the PSC 
limit as described in this section. That person must identify to NMFS 
on or before March 31 of each year, vessel permits or CPH that will be 
rendered unusable the upcoming fishing year so that the person's total 
PSC for the upcoming fishing year is an amount equal to or below the 
PSC limit. Beginning on May 1, the permits or CPH rendered unusable may 
not be fished, leased, or enrolled in a sector by that person for the 
remainder of the fishing year, but may be transferred by that person. 
The transfer of a permit or CPH rendered unusable shall be made through 
an arm's-length transaction (for example, to an independent and 
unrelated entity that does not share an ownership interest with that 
person).
* * * * *
    (c) * * *
    (2) Vessel permit information requirements. (i) An application for 
a permit issued under this section, in addition to the information 
specified in paragraph (c)(1) of this section, also must contain at 
least the following information, and any other information required by 
the Regional Administrator: Vessel name, owner name or name of the 
owner's authorized representative, mailing address, and telephone 
number; USCG documentation number and a copy of the vessel's current 
USCG documentation or, for a vessel not required to be documented under 
title 46 U.S.C., the vessel's state registration number and a copy of 
the current state registration; a copy of the vessel's current party/
charter boat license (if applicable); home port and principal port of 
landing, length overall, GRT, NT, engine horsepower, year the vessel 
was built, type of construction, type of propulsion, approximate fish 
hold capacity, type of fishing gear used by the vessel, number of crew, 
number of party or charter passengers licensed to be carried (if 
applicable), permit category; if the owner is a corporation, a copy of 
the current Certificate of Incorporation or other corporate papers 
showing the date of incorporation and the names of the current officers 
of the corporation, and the names and

[[Page 18715]]

addresses of all persons holding any ownership interest in a NE 
multispecies permit or CPH or shareholders owning 25 percent or more of 
the corporation's shares for other fishery permits; if the owner is a 
partnership, a copy of the current Partnership Agreement and the names 
and addresses of all partners; permit number of any current or, if 
expired, previous Federal fishery permit issued to the vessel.
* * * * *

0
4. In Sec.  648.14:
0
a. Add paragraphs (k)(2)(v) and (vi);
0
b. Revise paragraph (k)(9)(i); and
0
c. Add paragraph (k)(9)(ii)(N).
    The additions and revisions read as follows:


Sec.  648.14  Prohibitions.

* * * * *
    (k) * * *
    (2) * * *
    (v) Fish for, possess, land fish, enroll in a sector, or lease a 
permit or confirmation of permit history (CPH) as a lessor or lessee, 
with a permit that has been rendered unusable as specified in Sec.  
648.4(a)(1)(i)(N).
    (vi) Acquire a limited access NE multispecies permit that would 
result in a permit holder exceeding any of the ownership accumulation 
limits specified in Sec.  648.4(a)(1)(i)(N), unless authorized under 
Sec.  648.4(a)(1)(i)(N).
* * * * *
    (9) * * *
    (i) If operating under the provisions of a limited access NE 
multispecies Handgear A permit south of the GOM Regulated Mesh Area, as 
defined at Sec.  648.80(a)(1), fail to declare the vessel operator's 
intent to fish in this area via VMS or fail to obtain or retain on 
board a letter of authorization from the Regional Administrator, as 
required by Sec.  648.82(b)(6)(iii).
* * * * *
    (ii) * * *
    (N) Act as a lessor or lessee of NE multispecies DAS to or from a 
limited access permit that has been rendered unusable as specified in 
Sec.  648.4(a)(1)(i)(N).
* * * * *

0
5. In Sec.  648.82, revise paragraphs (b)(6) and (g) to read as 
follows:


Sec.  648.82  Effort control program for NE multispecies limited access 
vessels.

* * * * *
    (b) * * *
    (6) Handgear A category. A vessel qualified and electing to fish 
under the Handgear A category, as described in Sec.  648.4(a)(1)(i)(A), 
may retain, per trip, up to 300 lb (135 kg) of cod, one Atlantic 
halibut, and the daily possession limit for other regulated species and 
ocean pout, as specified under Sec.  648.86. If either the GOM or GB 
cod trip limit applicable to a vessel fishing under a NE multispecies 
DAS permit, as specified in Sec.  648.86(b)(1) and (2), respectively, 
is reduced below 300 lb (135 kg) per DAS by NMFS, the cod trip limit 
specified in this paragraph (b)(6) shall be adjusted to be the same as 
the applicable cod trip limit specified for NE multispecies DAS 
permits. For example, if the GOM cod trip limit for NE multispecies DAS 
vessels was reduced to 250 lb (113.4 kg) per DAS, then the cod trip 
limit for a vessel issued a Handgear A category permit that is fishing 
in the GOM Regulated Mesh Area would also be reduced to 250 lb (113.4 
kg). Qualified vessels electing to fish under the Handgear A category 
are subject to the following restrictions:
    (i) The vessel must not use or possess on board gear other than 
handgear while in possession of, fishing for, or landing NE 
multispecies;
    (ii) Tub-trawls must be hand-hauled only, with a maximum of 250 
hooks; and
    (iii) Declaration. For any such vessel that is not required to use 
VMS pursuant to Sec.  648.10(b)(4), to fish for GB cod south of the GOM 
Regulated Mesh Area, as defined at Sec.  648.80(a)(1), a vessel owner 
or operator must obtain, and retain on board, a letter of authorization 
from the Regional Administrator stating an intent to fish south of the 
GOM Regulated Mesh Area and may not fish in any other area for a 
minimum of seven consecutive days from the effective date of the letter 
of authorization. For any such vessel that is required, or elects, to 
use VMS pursuant to Sec.  648.10(b)(4), to fish for GB cod south of the 
GOM Regulated Mesh Area, as defined at Sec.  648.80(a)(1), a vessel 
owner or operator must declare an intent to fish south of the GOM 
Regulated Mesh Area on each trip through the VMS prior to leaving port, 
in accordance with instructions provided by the Regional Administrator. 
Such vessels may transit the GOM Regulated Mesh Area, as defined at 
Sec.  648.80(a)(1), provided that their gear is stowed and not 
available for immediate use as defined in Sec.  648.2.
* * * * *
    (g) Spawning season restrictions. A vessel issued a valid Small 
Vessel category permit specified in paragraph (b)(5) of this section, 
or a vessel issued an open access Handgear B permit, as specified in 
Sec.  648.88(a), may not fish for, possess, or land regulated species 
or ocean pout from March 1 through March 20 of each year. A common pool 
vessel must declare out and be out of the NE multispecies DAS program, 
and a sector must declare that the vessel will not fish with gear 
capable of catching NE multispecies (i.e., gear that is not defined as 
exempted gear under this part), for a 20-day period between March 1 and 
May 31 of each calendar year, using the notification requirements 
specified in Sec.  648.10. A vessel fishing under a Day gillnet 
category designation is prohibited from fishing with gillnet gear 
capable of catching NE multispecies during its declared 20-day spawning 
block, unless the vessel is fishing in an exempted fishery, as 
described in Sec.  648.80. If a vessel owner has not declared and been 
out of the fishery for a 20-day period between March 1 and May 31 of 
each calendar year on or before May 12 of each year, the vessel is 
prohibited from fishing for, possessing or landing any regulated 
species, ocean pout, or non-exempt species during the period from May 
12 through May 31.
* * * * *

0
6. In Sec.  648.87, revise paragraph (c)(2)(i) introductory text to 
read as follows:


Sec.  648.87  Sector allocation.

* * * * *
    (c) * * *
    (2) * * *
    (i) Regulations that may not be exempted for sector participants. 
The Regional Administrator may not exempt participants in a sector from 
the following Federal fishing regulations: Specific times and areas 
within the NE multispecies year-round closure areas; permitting 
restrictions (e.g., vessel upgrades, etc.); gear restrictions designed 
to minimize habitat impacts (e.g., roller gear restrictions, etc.); 
reporting requirements; and AMs specified in Sec.  648.90(a)(5)(i)(D). 
For the purposes of this paragraph (c)(2)(i), the DAS reporting 
requirements specified in Sec.  648.82, the SAP-specific reporting 
requirements specified in Sec.  648.85, VMS requirements for Handgear A 
category permitted vessels as specified in Sec.  648.10, and the 
reporting requirements associated with a dockside monitoring program 
are not considered reporting requirements, and the Regional 
Administrator may exempt sector participants from these requirements as 
part of the approval of yearly operations plans. For the purpose of 
this paragraph (c)(2)(i), the Regional Administrator may not grant 
sector participants exemptions from the NE multispecies year-round 
closures areas defined as Essential Fish Habitat Closure Areas as 
defined in

[[Page 18716]]

Sec.  648.81(h); the Fippennies Ledge Area as defined in paragraph 
(c)(2)(i)(A) of this section; Closed Area I and Closed Area II, as 
defined in Sec.  648.81(a) and (b), respectively, during the period 
February 16 through April 30; and the Western GOM Closure Area, as 
defined at Sec.  648.81(e), where it overlaps with GOM Cod Protection 
Closures I through III, as defined in Sec.  648.81(f)(4). This list may 
be modified through a framework adjustment, as specified in Sec.  
648.90.
* * * * *

0
7. In Sec.  648.90, revise paragraphs (a)(2)(i) through (iii) to read 
as follows:


Sec.  648.90  NE multispecies assessment, framework procedures and 
specifications, and flexible area action system.

* * * * *
    (a) * * *
    (2) Biennial review. (i) At a minimum, the NE multispecies PDT 
shall meet on or before September 30 every other year to perform a 
review of the fishery, using the most current scientific information 
available provided primarily from the NEFSC. Data provided by states, 
ASMFC, the USCG, and other sources may also be considered by the PDT. 
The PDT shall review available data pertaining to: Catch and landings, 
discards, DAS allocations, DAS use, sector operations, and other 
measures of fishing effort; survey results; stock status; current 
estimates of fishing mortality and overfishing levels; social and 
economic impacts; enforcement issues; and any other relevant 
information. The PDT may also review the performance of different user 
groups or fleet sectors.
    (ii) Based on this review, the PDT shall recommend ACLs for the 
upcoming fishing year(s), as described in paragraph (a)(4) of this 
section, and develop options for consideration by the Council, if 
necessary, on any changes, adjustments, or additions to DAS 
allocations, closed areas, or other measures necessary to rebuild 
overfished stocks and achieve the FMP goals and objectives, which may 
include a preferred option. The range of options developed by the PDT 
may include any of the management measures in the FMP, including, but 
not limited to: ACLs, which must be based on the projected fishing 
mortality levels required to meet the goals and objectives outlined in 
the FMP for the 12 regulated species and ocean pout if able to be 
determined; identifying and distributing ACLs and other sub-components 
of the ACLs among various segments of the fishery; AMs; DAS changes; 
possession limits; gear restrictions; closed areas; permitting 
restrictions; minimum fish sizes; recreational fishing measures; 
describing and identifying EFH; fishing gear management measures to 
protect EFH; designating habitat areas of particular concern within 
EFH; and changes to the SBRM, including the CV-based performance 
standard, the means by which discard data are collected/obtained, 
fishery stratification, the process for prioritizing observer sea-day 
allocations, reports, and/or industry-funded observers or observer set 
aside programs. The PDT must demonstrate through analyses and 
documentation that the options it develops are expected to meet the FMP 
goals and objectives.
    (iii) In addition, the PDT may develop ranges of options for any of 
the management measures in the FMP and the following conditions that 
may be adjusted through a framework adjustment to achieve FMP goals and 
objectives including, but not limited to: Revisions to DAS measures, 
including DAS allocations (such as the distribution of DAS among the 
four categories of DAS), future uses for Category C DAS, and DAS 
baselines, adjustments for steaming time, etc.; accumulation limits due 
to a permit buyout or buyback; modifications to capacity measures, such 
as changes to the DAS transfer or DAS leasing measures; calculation of 
area-specific ACLs (including sub-ACLs for specific stocks and areas 
(e.g., Gulf of Maine cod)), area management boundaries, and adoption of 
area-specific management measures including the delineation of inshore/
offshore fishing practices, gear restrictions, declaration time 
periods; sector allocation requirements and specifications, including 
the establishment of a new sector, the disapproval of an existing 
sector, the allowable percent of ACL available to a sector through a 
sector allocation, an optional sub-ACL specific to Handgear A permitted 
vessels, and the calculation of PSCs; sector administration provisions, 
including at-sea and dockside monitoring measures; sector reporting 
requirements; state-operated permit bank administrative provisions; 
measures to implement the U.S./Canada Resource Sharing Understanding, 
including any specified TACs (hard or target); changes to 
administrative measures; additional uses for Regular B DAS; reporting 
requirements; declaration requirements pertaining to when and what time 
period a vessel must declare into or out of a fishery management area; 
the GOM Inshore Conservation and Management Stewardship Plan; 
adjustments to the Handgear A or B permits; gear requirements to 
improve selectivity, reduce bycatch, and/or reduce impacts of the 
fishery on EFH; SAP modifications; revisions to the ABC control rule 
and status determination criteria, including, but not limited to, 
changes in the target fishing mortality rates, minimum biomass 
thresholds, numerical estimates of parameter values, and the use of a 
proxy for biomass may be made either through a biennial adjustment or 
framework adjustment; changes to the SBRM, including the CV-based 
performance standard, the means by which discard data are collected/
obtained, fishery stratification, the process for prioritizing observer 
sea-day allocations, reports, and/or industry-funded observers or 
observer set aside programs; and any other measures currently included 
in the FMP.
* * * * *
[FR Doc. 2017-08035 Filed 4-20-17; 8:45 am]
BILLING CODE 3510-22-P