Safety Approvals, 46847-46856 [E6-13313]

Agencies

• Federal Aviation Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 71, Number 157 (Tuesday, August 15, 2006)]
[Rules and Regulations]
[Pages 46847-46856]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-13313]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 71, No. 157 / Tuesday, August 15, 2006 / 
Rules and Regulations

[[Page 46847]]



DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 413 and 414

[Docket No.: FAA-FAA-2005-21332; Amendment Nos. 413-6 and 414-1]
RIN 2120-AI50


Safety Approvals

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: This action amends commercial space transportation regulations 
by adding procedures for obtaining a safety approval for a safety 
element. Also, this action adds procedures for including a safety 
approval in a license application. Once the FAA issues a safety 
approval, the holder could offer the approved safety element to 
prospective launch and reentry operators for use within a defined and 
proven envelope. Those operators would not need added FAA approval of 
that portion of their license application. The decision to apply for a 
safety approval is voluntary. The intent of this action is to 
facilitate the launch and reentry license application and approval 
processes.

DATES: This amendment becomes effective September 14, 2006.

FOR FURTHER INFORMATION CONTACT: For questions about the safety 
approval process, you may contact either of the following persons:
     Charles P. Brinkman, Licensing and Safety Division (AST-
200), FAA, Associate Administrator for Commercial Space Transportation, 
Room 331, 800 Independence Avenue, SW., Washington, DC 20591; telephone 
(202) 267-7715; or
     Gary Michel, Office of the Chief Counsel (AGC-200), FAA, 
Room 915, 800 Independence Avenue, SW., Washington, DC 20591; telephone 
(202) 267-3148.
    For questions about technical standards, you may contact Jim 
Kabbara, Systems Engineering and Training Division (AST-300), FAA, 
Associate Administrator for Commercial Space Transportation, Room 331, 
800 Independence Avenue, SW., Washington, DC 20591; telephone (202) 
267-8379.

SUPPLEMENTARY INFORMATION:

Availability of Rulemaking Documents

    You can get an electronic copy using the Internet by:
    (1) Searching the Department of Transportation's electronic Docket 
Management System (DMS) Web page (https://dms.dot.gov/search);
    (2) Visiting the FAA's Regulations and Policies Web page at https://
www.faa.gov/regulations_policies/; or
    (3) Accessing the Government Printing Office's Web page at https://
www.gpoaccess.gov/fr/.
    You can also get a copy by sending a request to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue, SW., Washington, DC 20591, or by calling (202) 267-9680. Make 
sure to identify the amendment number or docket number of this 
rulemaking.
    Anyone is able to search the electronic form of all comments 
received into any of our dockets by the name of the individual 
submitting the comment (or signing the comment, if submitted for an 
association, business, labor union, etc.). You may review DOT's 
complete Privacy Act statement in the Federal Register published on 
April 11, 2000 (Volume 65, Number 70; Pages 19477-78) or you may visit 
https://dms.dot.gov.

Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires FAA to comply with small entity requests for information 
or advice about compliance with statutes and regulations within its 
jurisdiction. If you are a small entity and you have a question about 
this document, you may contact the local FAA official, or the person 
listed under FOR FURTHER INFORMATION CONTACT. You can find out more 
about SBREFA on the Internet at https://www.faa.gov/regulations_
policies/rulemaking/sbre_act/.

Authority for This Rulemaking

    The Commercial Space Launch Act of 1984, as codified and amended at 
49 U.S.C. Subtitle IX-Commercial Space Transportation, ch. 701, 
Commercial Space Launch Activities, 49 U.S.C. 70101-70121 (the Act), 
authorizes the Department of Transportation and the FAA, through 
delegations, to oversee, license, and regulate commercial launch and 
reentry activities and the operation of launch and reentry sites as 
carried out by United States citizens or within the United States.\1\ 
The Act directs the FAA to exercise this responsibility consistent with 
public health and safety, safety of property, and the national security 
and foreign policy interests of the United States.\2\ The FAA is also 
responsible for encouraging, facilitating, and promoting commercial 
space launches by the private sector.\3\
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    \1\ 49 U.S.C. 70104, 70105.
    \2\ 49 U.S.C. 70105.
    \3\ 49 U.S.C. 70103.
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    Authority for this particular rulemaking is derived from section 
70105(a)(2) of the Act, which states the Secretary may establish 
procedures for safety approval of launch vehicles, reentry vehicles, 
safety systems, processes, services, or personnel for use in conducting 
licensed commercial space launch or reentry activities.\4\ The 2004 
amendments to the Act provided details regarding safety approvals for 
personnel to include explicit approval procedures for the purpose of 
protecting the health and safety of crews and space flight 
participants.\5\
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    \4\ See Commercial Space Act of 1998, Public Law 105-303.
    \5\ See Commercial Space Launch Amendments Act of 2004, Public 
Law 108-492.
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Background

    Under the authority derived from the Act, on June 1, 2005, the FAA 
published the notice of proposed rulemaking (NPRM), ``Safety Approvals; 
Proposed Rule'' (70 FR 32192). This final rule adopts the provisions in 
that NPRM with some changes, which we describe later in this preamble. 
It also responds to the comments to that proposed rule.
    The nature of the commercial space transportation industry makes 
safety approvals attractive to prospective

[[Page 46848]]

launch or reentry license \6\ applicants, launch and reentry vehicle 
operators, and other industry representatives. Different operators 
often use major components, parts, or services that could potentially 
qualify for a safety approval on different launch vehicles. Personnel 
involved in operational safety support such as telemetry, tracking, and 
range safety may support multiple launch or reentry operators and could 
also qualify for a safety approval.
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    \6\ Commercial Space Launch Amendments Act of 2004 
(70105a(i)(4)) states ``the issuance of a permit shall be considered 
licensing.'' Therefore, when used in this regulation, the term 
``license'' means any license or permit the FAA may issue under 14 
CFR chapter III.
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    Historically, the launch operator has borne the monetary risk of 
proposing a new system, process, or service. Many launch operators have 
not thought the benefits worth the cost to prove the safety of a new 
safety element \7\ through the licensing process because of the small 
number of launches. With the safety approval process in place, the risk 
of approval is transferred to the prospective safety approval applicant 
(i.e., the provider of the approved safety element). This optional 
process opens the door to new providers that may want to offer these 
safety elements for use in launch and reentry activities. The safety 
approval allows for the potential use of an approved safety element on 
more than one launch or reentry vehicle. Therefore, safety approvals 
have the potential to make the industry more willing to adopt 
innovative systems and processes because the cost of obtaining the 
approval would be shared, rather than borne by a single launch 
operator.
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    \7\ For purposes of 14 CFR part 414, a safety element is any one 
of the following: launch vehicle, reentry vehicle, safety system, 
process, service, or any identified component thereof; or qualified 
and trained personnel, performing a process or function related to 
license launch activities or vehicles.
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    This rule may benefit the commercial space industry and the FAA by 
streamlining the processes for reviewing and issuing launch and reentry 
licenses. It will allow eligible persons to apply for a safety approval 
for an eligible safety element that can be used as part of prospective 
launch or reentry activities. A holder of a safety approval will be 
able to offer the approved safety element to prospective launch or 
reentry operators. Operators may include the approved element in their 
part 413 licensing application with minimal added documentation. The 
FAA may benefit from safety approvals because a portion of the 
documentation and analysis necessary to make a licensing determination 
on an application that includes such approvals will already have been 
done as part of the safety approval process.

General Discussion of Rule

    This regulation amends part 413 to incorporate procedures for 
including a safety approval in an application for a launch or reentry 
activity. It also establishes a new part 414, which includes the 
requirements and procedures for voluntarily obtaining a safety approval 
for the following safety elements: a launch vehicle, reentry vehicle, 
safety system, process, service, or any identified component thereof, 
or qualified and trained personnel.
    This rule will enable launch and reentry vehicle operators to use 
an approved safety element within the scope specified in the safety 
approval without having to go through a re-examination of the element's 
fitness and suitability for a particular launch or reentry proposal. 
The approval allows these operators to rely on an approved element in 
constructing a launch vehicle or in conducting a safe launch. Use of a 
safety element for which a safety approval has been issued is not 
required as part of the part 413 application process. The safety 
approval, separate from any license, does not confer any authority to 
conduct activities for which a license is required. The FAA will 
evaluate the planned use of a safety approval for a proposed launch or 
reentry activity to ensure that use of the safety approval does not 
exceed its approved scope.
    Where appropriate, the FAA will coordinate its review of 
applications for safety approvals with other government agencies and 
especially with the operators of Federal launch ranges. Currently, the 
FAA works closely with the U.S. Air Force because most FAA-licensed 
launches have occurred at ranges operated by the U.S. Air Force. 
However, other Federal agencies may have an interest in a safety 
element under consideration for a safety approval. The FAA expects to 
consult with these agencies to minimize the possibility of a 
discrepancy between its evaluation and any later evaluation by another 
Federal agency.

Discussion of Comments

    Three commenters provided multiple comments to the NPRM--Mr. Hugh 
Q. Cook, commenting as a private citizen, Lockheed Martin Corporation 
and International Launch Services (LMC/ILS), and Eric Miller of Central 
Missouri State University. Each commenter expressed strong support for 
the rule and each made recommendations for improvements. Most of the 
comments were from Mr. Cook.

Safety Approval Definition

    Mr. Cook suggested rewriting the definition of ``safety approval'' 
to remove ``circular reasoning.'' Also, he said the FAA's emphasis in 
the preamble discussion that an approval is not a certification is an 
unnecessary distinction. This is particularly true, he said, given the 
U.S. space launch industry does not operate under a certification 
regime; and the fundamentals of licensing versus certification places 
responsibility for safe conduct of operations on the licensee.
    The FAA agrees with Mr. Cook that the safety approval definition as 
written in the proposed rule could be clearer, so we revised the final 
rule version, accordingly. However, we do not agree that explaining the 
distinction between an approval and a certification is unnecessary. 
Although Mr. Cook is correct that the U.S. space industry does not 
currently operate under a certification regime, new entrants, 
particularly those proposing reusable launch vehicles that would 
operate more like aircraft, are very likely to be familiar with the 
aircraft certification process. Therefore, we believe it is important 
to point out that a safety approval is not the equivalent of a 
certification under a design standard. By making this distinction, the 
FAA seeks to avoid any misunderstanding that an approval means 
certification. Mr. Cook is also correct that the FAA's licensing regime 
places responsibility for safe conduct of operations on the licensee. 
However, we do not believe the distinction between an approval and a 
certification in any way conflicts with this position. The distinction 
simply reaffirms that a safety approval is limited to use within a 
defined parameter.

Safety Approvals Are Voluntary

    Mr. Eric Miller commented that the rule would be more effective in 
ensuring public safety if the FAA makes the use of safety approvals 
mandatory for all persons conducting space flights.
    We do not agree that it is necessary to make the use of safety 
approvals mandatory to increase the safety of space launches. This 
regulation will make safety approvals available for use by prospective 
launch and reentry operators. To conduct a launch or reentry activity, 
these operators must apply for a license under 14 CFR chapter III. To 
obtain a license under this chapter, applicants must demonstrate that 
the prospective activities will not endanger public health and safety 
and safety of property.

[[Page 46849]]

Eligibility

    Mr. Cook said the statement in the NPRM regulatory text that 
``anyone'' may apply for a safety approval is misleading and sets a 
``frivolous tone.'' He recommended that we identify persons likely to 
benefit from the regulation.
    We appreciate Mr. Cook's concern. The intent of the NPRM language 
under Sec.  414.9 was to convey that the restrictions that exist for 
licensing do not apply to safety approval applicants. We placed the 
specific eligibility requirements, including the persons who may be 
eligible to apply for a safety approval, in proposed Sec.  414.15 (How 
will the FAA determine whether something is eligible and suitable for a 
safety approval?). We agree that placing these requirements in separate 
sections may be misleading. Therefore, in the final rule, we placed 
them in one section.\8\ In addition, we removed the statement that 
``anyone may apply for a safety approval.''
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    \8\ Sec.  414.7 (Eligibility).
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The Application Process

    Mr. Cook said he found the statement that the FAA will incorporate 
prior findings from a past licensing determination in issuing a new 
license ``troubling'' because it implies that there is a different 
process and a higher standard for a new applicant to obtain a safety 
approval compared to a current licensee. Also, he believes this 
statement implies the FAA will not do a thorough review of previously 
approved parts, materials, and services, but will simply rubber-stamp 
them as a part of the licensing process.
    The FAA did not intend to convey the inferences Mr. Cook has drawn. 
First, the process or standard for assessing and issuing a safety 
approval is the same for a new applicant as for an existing licensee. 
The statement that the FAA incorporates prior findings from a past 
licensing determination recognizes current FAA practice. This statement 
in no way means the FAA will automatically issue an approval for a 
safety element because the element was previously approved as part of a 
licensing process. As required by Sec.  414.11(c)(1) of this final 
rule, all applicants must include in their application a Statement of 
Conformance letter. This letter must describe the specific criteria 
applicants used to demonstrate the adequacy of the safety element for 
which they seek a safety approval. It must also show that the safety 
element complies with the specific criteria. The FAA will review each 
application according to the procedures in part 414, subpart C of this 
final rule.
    Mr. Cook said the FAA should not have commented on the 
``comparative merits of the safety approval procedure vis-a-vis the 
existing licensing procedure'' as the merits of the two should speak 
for themselves.
    We agree in part with Mr. Cook's comment that our discussion about 
the applicant's responsibility for determining the value of seeking a 
safety approval is not necessary. Perhaps we stated the obvious since 
applying for a safety approval is strictly voluntary so it is unlikely 
anyone would pursue one if it were not cost beneficial to do so. 
However, we believe that determining the value of a safety approval 
independent of the licensing process is an important enough point to 
make as part of the discussion of the application process.
    Mr. Cook suggested the FAA allow a corporation to authorize someone 
other than an officer to certify a safety approval application.
    The FAA agrees with Mr. Cook's comment. For license applications, 
the FAA has found that the individuals who sign and certify license 
applications are not typically officers of the corporation. Therefore, 
we added a similar provision in this final rule under Sec.  
414.11(d)(1) to allow an individual authorized to act for the 
corporation to sign and certify the accuracy of a safety approval 
application. In addition, in another rulemaking action, we proposed a 
similar change to Sec.  413.7(c)(1) \9\ to also allow an individual 
authorized to act for the corporation to sign and certify license 
applications.
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    \9\ ``Experimental Permits for Reusable Suborbital Rockets'' 
Notice of proposed rulemaking (70 FR 16251, March 31, 2006).
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Timeframe for Application Review

    Mr. Cook suggested a goal of 30 days for the FAA to review and make 
a determination on a substantially complete application.
    The FAA disagrees with Mr. Cook's comment that there should be a 
30-day review period for safety approval applications. Until industry 
and the FAA gain experience with filing and processing these 
applications, it would not be prudent for us to consider setting a 
specific time frame for our review. Also, we do not believe that having 
a set review period for all applications without first considering the 
level of complexity for each is the most practical approach. Instead, 
the FAA and the applicant will discuss what is a reasonable time frame 
to complete review of a specific application during the pre-application 
consultation. The Act gives the FAA up to 180 days to make a licensing 
determination after receipt of an application. We believe making a 
safety approval determination could take this much time.

Technical Criteria for Issuing a Safety Approval

    The rule includes a hierarchy of technical criteria for reviewing a 
safety approval. One such criterion in proposed Sec.  414.27(b) is 
``government-developed or adopted standards.'' Mr. Cook suggested 
revising this section to read, ``Government-developed or adopted 
standards, including approved tailoring applicable to a specific 
application for safety approval.'' He also suggested we define 
``approved tailoring'' to include the necessity of publishing the 
details of the tailoring in an accessible form.
    We appreciate Mr. Cook's suggestions; however, we do not believe a 
change to the rule is necessary. As written, the rule lists specific 
technical criteria \10\ the FAA will use to make a safety approval 
determination. The criteria include government-developed or adopted 
standards and applicant developed standards, which are variations of 
tailored standards. Also, the rule requires applicants to allow the FAA 
to make their proposed safety approval criteria available to the public 
as part of the approval process.
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    \10\ See 414.27(d) in the proposed rule and 414.19(a) in the 
final rule.
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    Lockheed Martin Corporation and International Launch Services (LMC/
ILS), commenting together, had a recommendation related to the 
statement in proposed Sec.  414.27 that reads, ``You must agree to 
allow the FAA to make proposed safety approval criteria available to 
the public as part of the approval process.'' LMC/ILS asserted that 
this statement would require the applicant to waive the customary 
protections associated with proprietary or otherwise sensitive 
information. They recommended revising the rule language to allow 
individual determinations on whether the FAA will make proposed safety 
approval criteria public and allow applicants to withdraw their 
application to avoid public release of their approval criteria.
    The FAA does not agree with LMC/ILS's assertion. In the section-by-
section discussion under proposed Sec.  414.19 (How can I assure 
confidentiality of the information I submit on a safety approval 
application?), the FAA states, ``Do not propose standards that you

[[Page 46850]]

consider secret, proprietary, and confidential.'' In the regulatory 
text itself, the FAA states, ``If the proposed criteria for evaluating 
a safety approval is secret, as classified by the U.S. Government, or 
the applicant wants it to remain proprietary or confidential, it cannot 
be used as a basis for the issuance of a safety approval.'' \11\
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    \11\ See Sec.  414.19(e) of the NPRM and Sec.  414.13 
(Confidentiality) of this final rule.
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    The FAA intends, as part of our on-going dialogue with the 
applicant, to discuss the criteria that would appear in the public 
record. Because the goal would be for the criteria to be performance-
based, to the greatest extent possible, the FAA does not believe that 
safety approval applicants would need to waive protections in order to 
obtain a safety approval. The FAA believes it is essential to make 
public the basis for issuance of a safety approval. We also believe the 
right of the applicant to withdraw an application is implicit. However, 
stating this right in the regulations will avoid any confusion. Hence, 
in the final rule under Sec.  414.15(d), we added the right of the 
applicant to withdraw the application before we make a final 
determination.

Terms and Conditions of a Safety Approval

    Mr. Cook commented that the FAA introduced an important new term in 
the preamble discussion, ``scope of the demonstration.'' He noted that 
in the regulatory text, we modified this term to ``scope of the safety 
demonstration.'' Further, he said in other rulemakings the FAA 
established an equivalent definition of ``demonstration'' to the 
aerospace industry's definition of ``verification.'' He requested that 
the FAA define what we mean by the term ``scope of the (safety) 
demonstration.''
    The FAA believes the regulation as written makes clear what is 
meant by ``scope of demonstration.'' In the NPRM preamble discussion 
under the heading ``How do I prepare an application?'', we explain that 
the scope of the safety approval would be based on the scope of the 
safety demonstration. The demonstration might consist of analysis, 
testing, actual use, observation, physical inspection, simulation, 
historical data, or other means of verifying performance. Different 
means of demonstration might be used for a safety approval of a design 
of a system than for a safety approval for personnel to perform a 
particular safety task.
    In the NPRM preamble discussion, we give a specific example of what 
we mean by ``the scope of the demonstration.'' The example reads as 
follows: for a radar tracking system integral to range safety, you 
might demonstrate the ability of the radar to track launch vehicles as 
a function of radar cross section, vehicle velocity, acceleration, and 
trajectory along with notable ambient effects, such as weather 
conditions. The demonstration and, therefore, the scope of the 
applicability of the safety approval would not be specific to a 
particular vehicle.
    In another comment Mr. Cook said the statutory authority would not 
agree with the FAA's statement that a safety approval has no meaning 
independent of its use in facilitating the FAA licensing process. He 
said he believes the safety approval rulemaking ``has profound meaning 
in the context of 'facilitate and promote'.''
    We do not agree with Mr. Cook that the statutory authority intends 
for a safety approval to have meaning independent of the licensing 
process. Section 70105(a)(2) of the Act states ``* * * the Secretary 
may establish procedures for safety approvals of launch vehicles, 
reentry vehicles, * * * that may be used in conducting licensed 
commercial space launch or reentry activities.'' In other words, the 
intent of the statute is to make safety approvals available to 
facilitate the licensing process, not as an independent service. We do 
agree, however, that the Act encourages (i.e., facilitates and 
promotes) private sector launches, reentries, and associated services, 
which includes safety approvals.

Modification, Suspension, Revocation of a Safety Approval

    In reference to proposed Sec.  414.39, Mr. Cook raised the 
following two questions: (1) Who is responsible for alerting a launch 
operator that is affected by the revocation of a safety approval? (2) 
What is the effect on a launch license that is issued based on a 
licensing determination that relies on a revoked safety approval?
    In response to the first question, the FAA does not believe it is 
necessary to include in the regulations that the licensee will be 
notified if we modify, suspend, or revoke a safety approval. This final 
rule contains the procedures for inclusion of a safety approval in a 
license application. Therefore, the FAA will know which of our 
licensees is using which safety approval(s). As a result, we will be 
able to make any necessary notifications to the affected licensee.
    With regard to the second question, a revocation may or may not 
affect an existing license. In his comments on the regulatory text, Mr. 
Cook suggested licensees be afforded the opportunity to amend their 
license applications to demonstrate that the safety approval action 
taken under this section does not have a material effect on public 
safety or the safety of property. As we explained in the preamble to 
the proposed rule, the FAA would afford licensees such an opportunity 
unless an immediate threat to public health and safety or the safety of 
property requires more immediate action, including a license 
suspension. We do not believe the addition of regulatory text stating 
this adds any value. Because of the sporadic nature of launches, in 
many instances the FAA could work with the affected licensee to resolve 
any issues. However, as discussed in the section-by-section analysis in 
the proposed rule, if an immediate threat to public health and safety 
or safety of property presented itself as a result of an issue 
regarding a safety approval, the FAA might need to suspend a license to 
prevent a potentially dangerous launch or reentry.

Changes to the NPRM

    We made substantial formatting changes to the regulatory text. Our 
intent is to further clarify the regulations and make them more 
concise, not change their intent. First, we changed the question and 
answer format of the section headings to regular headings that are more 
reflective of the section content. For example, Sec.  414.1 in the NPRM 
is titled ``What is the basis and scope of this rule?''. We changed 
this section heading to ``Scope'' in the final rule. Second, in some 
instances we moved text into different sections under more appropriate 
headings and combined text from multiple sections under a single 
heading. For example, we moved text from proposed Sec.  414.15 (How 
will the FAA determine whether something is eligible and suitable for a 
safety approval?) to two separate sections of the final rule. That is, 
we placed the specific requirements in proposed Sec.  414.15 related to 
determining eligibility under ``Eligibility'' (Sec.  414.7) in the 
final rule. However, we moved the requirements in proposed Sec.  
414.15(e) about the criteria for the FAA's evaluation of a safety 
approval application to Sec.  414.19 (Technical criteria for reviewing 
a safety approval application) in the final rule.
    In the NPRM when we refer to safety elements that are eligible for 
a safety approval, we list each of the elements (launch vehicle, 
reentry vehicle, safety system, process, service, or any identified 
component thereof, or qualified and trained personnel). Since we 
recognize that these elements are the

[[Page 46851]]

only ones eligible for a safety approval, in the final rule we define 
the term ``safety element'' to mean any one of these elements.\12\
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    \12\ See Sec.  414.3 (Definitions) in the final rule.
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    Under proposed Sec.  414.31 (How would a license applicant 
incorporate a safety approval into a launch or reentry license 
application?), we inadvertently placed some requirements related to 
part 413 applicants in part 414. While we state in proposed Sec.  
414.31 that these requirements apply to part 413 applicants, we should 
have amended part 413 to include these requirements. This final rule 
corrects this oversight by amending the license application procedures 
in Sec.  413.7 to add paragraph (d). This new paragraph includes the 
same requirements for part 413 applicants that are in proposed Sec.  
414.31.
    In addition to these changes and as indicated under the 
``Discussion of Comments'' heading, we made a few changes recommended 
by commenters. First, we added a provision that allows authorized 
individuals to sign and certify safety approval applications. Second, 
we added a provision, which states the applicant may withdraw the 
safety approval application before we make a final determination.

Paperwork Reduction Act

    Information collection requirements associated with this final rule 
have been approved previously by the Office of Management and Budget 
(OMB) under the provisions of the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507(d)), and have been assigned OMB Control Numbers 2120-0608 
and 2120-0643. These prior approvals are applicable because this final 
rule merely permits consideration of a portion of the activity covered 
by the cited documents. In other words, a part of the information 
required for FAA-licensed activity is collected for the safety approval 
and does not need to be collected again as part of the license 
application.

International Compatibility

    In keeping with U.S. obligations under the Convention on 
International Civil Aviation, it is FAA policy to comply with 
International Civil Aviation Organization (ICAO) Standards and 
Recommended Practices to the maximum extent practicable. The FAA has 
determined that there are no ICAO Standards and Recommended Practices 
that correspond to these proposed regulations.

Executive Order 12866 and DOT Regulatory Policies and Procedures

    Executive Order 12866, Regulatory Planning and Review, directs the 
FAA to assess both the costs and the benefits of a regulatory change. 
We are not allowed to propose or adopt a regulation unless we make a 
reasoned determination that the benefits of the intended regulation 
justify the costs. Our assessment of this rulemaking indicates that its 
economic impact is minimal because safety approvals under the 
rulemaking action are not mandatory so there would be no costs imposed 
on industry. The FAA anticipates that launch license applicants would 
only pursue a safety approval if they believe they can save money by 
using a safety approval. If not, they would continue to obtain approval 
through the licensing determination. The final rule might result in 
slight costs to the government, but more likely it will result in 
government cost savings.
    Because the costs and benefits of this action do not make it a 
``significant regulatory action'' as defined in the Order, we have not 
prepared a ``regulatory evaluation,'' which is the written cost/benefit 
analysis ordinarily required for all rulemakings under the DOT 
Regulatory Policies and Procedures. We do not need to do a full 
evaluation where the economic impact of a rule is minimal.

Economic Assessment, Regulatory Flexibility Determination, Trade Impact 
Assessment, and Unfunded Mandates Assessment

    Proposed changes to Federal regulations must undergo several 
economic analyses. First, Executive Order 12866 directs that each 
Federal agency shall propose or adopt a regulation only upon a reasoned 
determination that the benefits of the intended regulation justify its 
costs. Second, the Regulatory Flexibility Act of 1980 (Pub. L. 96-354) 
requires agencies to analyze the economic impact of regulatory changes 
on small entities. Third, the Trade Agreements Act (Pub. L. 96-39) 
prohibits agencies from setting standards that create unnecessary 
obstacles to the foreign commerce of the United States. In developing 
U.S. standards, this Trade Act requires agencies to consider 
international standards and, where appropriate, to be the basis of U.S. 
standards. Fourth, the Unfunded Mandate Reform Act of 1995 (Pub. L. 
104-4) requires agencies to prepare a written assessment of the costs, 
benefits, and other effects of proposed or final rules that include a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more annually (adjusted for inflation with a base year of 
1995). This portion of the preamble summarizes the FAA's analysis of 
the economic impacts of this final rule.
    The Department of Transportation Order DOT 2100.5 prescribes 
policies and procedures for simplification, analysis, and review of 
regulations. If the expected cost impact is so minimal that a proposal 
does not warrant a full evaluation, this order permits a statement to 
that effect. The basis for the minimal impact must be included in the 
preamble, if a full regulatory evaluation of the cost and benefits is 
not prepared. Such a determination has been made for this final rule. 
The reasoning for that determination follows.
    The 1998 amendments to the Commercial Space Launch Act of 1984 
added authority for establishing procedures for ``safety approvals'' of 
launch vehicles, reentry vehicles, safety systems, processes, services, 
or personnel that may be used in conducting licensed commercial space 
launch or reentry activities. (See Commercial Space Act of 1998, Pub. 
L. 105-303.) This rulemaking will establish those procedures. The rule 
will enable license applicants to use safety-approved elements for 
proposed launch or reentry activities without having to resubmit 
certain information. The existence of a safety approval could 
streamline the licensing process. The final rule defines the 
requirements for obtaining these voluntary safety approvals.
    A key element of the final rule is that the safety approvals are 
strictly elective. A safety approval will enable the U.S. commercial 
space transportation industry to select ``approved'' systems, 
processes, services, and personnel, possibly reducing the information 
required for a license application. Because safety approvals under the 
final rulemaking are not mandatory, the FAA anticipates that applicants 
will only pursue a safety approval if they believe the benefits 
outweigh the costs.
    The final rule does not impose any costs on the license applicant, 
because the applicant is free to continue to obtain approval through 
the licensing determination. There might even be cost savings to 
license applicants because the cost of using safety-approved elements 
could be less than the cost the licensee might incur in seeking 
approval directly through the licensing determination. This is because 
a safety approval could be used for multiple launch licenses without 
added FAA

[[Page 46852]]

approval of that portion of the license application other than an 
evaluation of its intended use relative to the proposed activity.
    The final rule might result in additional cost to the Federal 
government. This might occur if a company obtains a safety approval 
from the FAA, but does not use it. In this case, the FAA will have 
spent the time for naught in issuing the safety approval. The FAA 
expects this to be unlikely, as companies will not seek to obtain 
safety approvals unless the likelihood of selling their approved 
product to a licensee is very high.
    On the other hand, the final rule might result in cost savings to 
the government. If the safety approval is used for several licenses, 
then the FAA could apply findings related to safety approvals to 
different license applicants that propose to use the approved element.
    In view of the possible minor additional cost to the Federal 
government and the anticipated benefits of the rule, the FAA has 
determined that this rule is cost-justified. Since seeking a safety 
approval and using it as a part of a launch or reentry activity is 
voluntary, the expected outcome will be a minimal impact with positive 
net benefits, and a regulatory evaluation was not prepared.
    The FAA has, therefore, determined this final rule is not a 
``significant regulatory action'' as defined in section 3(f) of 
Executive Order 12866, and is not ``significant'' as defined in DOT's 
Regulatory Policies and Procedures.

Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980 (RFA) establishes ``as a 
principle of regulatory issuance that agencies shall endeavor, 
consistent with the objective of the rule and of applicable statutes, 
to fit regulatory and informational requirements to the scale of the 
business, organizations, and governmental jurisdictions subject to 
regulation.'' To achieve that principle, the RFA requires agencies to 
consider flexible regulatory proposals, to explain the rationale for 
their actions, and to solicit comments. The RFA covers a wide-range of 
small entities, including small businesses, not-for-profit 
organizations and small governmental jurisdictions.
    Agencies must perform a review to determine whether a proposed or 
final rule will have a significant economic impact on a substantial 
number of small entities. If the agency determines that it will, the 
agency must prepare a regulatory flexibility analysis as described in 
the RFA.
    However, if an agency determines that a proposed or final rule is 
not expected to have a significant economic impact on a substantial 
number of small entities, section 605(b) of the RFA provides that the 
head of the agency may so certify and a regulatory flexibility analysis 
is not required. The certification must include a statement providing 
the factual basis for this determination, and the reasoning should be 
clear.
    The final rule does not impose costs on industry because it 
establishes a wholly voluntary process as an alternative to a part of 
the current licensing process.
    Therefore, as the FAA Administrator, I certify that this rulemaking 
action will not have a significant economic impact on a substantial 
number of small entities.

International Trade Impact Assessment

    The Trade Agreements Act of 1979 prohibits Federal agencies from 
establishing any standards or engaging in related activities that 
create unnecessary obstacles to the foreign commerce of the United 
States. Legitimate domestic objectives, such as safety, are not 
considered unnecessary obstacles. The statute also requires 
consideration of international standards and, where appropriate, that 
they be the basis for U.S. standards. The FAA has assessed the 
potential effect of this rule and has determined that since it will not 
impose standards on industry and because it establishes a wholly 
voluntary program, it will not create an unnecessary obstacle to the 
foreign commerce of the United States.

Unfunded Mandates Assessment

    Title II of the Unfunded Mandate Reform Act of 1995 requires each 
Federal agency to prepare a written statement assessing the effects of 
any Federal mandate in a proposed or final agency rule that may result 
in an expenditure of $100 million or more (adjusted annually for 
inflation with a base year of 1995) in any one year by State, local, 
and tribal governments, in the aggregate, or by the private sector; 
such a mandate is deemed a ``significant regulatory action.'' The FAA 
currently uses an inflation-adjusted value of $128.1 million in lieu of 
$100 million. This final rule does not contain such a mandate.

Executive Order 13132, Federalism

    The FAA has analyzed this final rule under the principles and 
criteria of Executive Order 13132, Federalism. We determined that this 
action will not have a substantial direct effect on the States, on the 
relationship between the national Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government, and therefore will not have federalism implications.

Environmental Analysis

    FAA Order 1050.1E identifies FAA actions that are categorically 
excluded from preparation of an environmental assessment or 
environmental impact statement under the National Environmental Policy 
Act in the absence of extraordinary circumstances. The FAA has 
determined this final rulemaking action qualifies for the categorical 
exclusion identified in paragraph 308b and involves no extraordinary 
circumstances.

Regulations That Significantly Affect Energy Supply, Distribution, or 
Use

    The FAA has analyzed this final rule under Executive Order 13211, 
Actions Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (May 18, 2001). We have determined that it is not 
a ``significant energy action'' under the executive order because it is 
not a ``significant regulatory action'' under Executive Order 12866, 
and it is not likely to have a significant adverse effect on the 
supply, distribution, or use of energy.

List of Subjects

14 CFR Part 413

    Confidential business information, Space transportation and 
exploration.

14 CFR Part 414

    Airspace, Aviation safety, Space transportation and exploration.

The Amendments

0
In consideration of the foregoing, the Federal Aviation Administration 
amends Chapter III of Title 14, Code of Federal Regulations, as 
follows:

PART 413--LICENSE APPLICATION PROCEDURES

0
1. The authority citation for part 413 continues to read as follows:


    Authority: 49 U.S.C. 70101-70121. 1


0
2. Amend Sec.  413.7 to add paragraph (d) to read as follows:


Sec.  413.7  Application.

* * * * *
    (d) Safety approval. If the applicant proposes to include a safety 
element for which the FAA issued a safety approval under part 414 in 
the proposed license activity, the applicant must--

[[Page 46853]]

    (1) Identify the safety approval in the application and explain the 
proposed use of the approved safety element.
    (2) Show that the proposed use of the approved safety element is 
consistent with the designated scope specified in the safety approval.
    (3) Certify that the safety element will be used according to any 
terms and conditions of the issued safety approval.

0
3. Add part 414 to read as follows:

PART 414--SAFETY APPROVALS

Subpart A--General
Sec.
414.1 Scope.
414.3 Definitions.
414.5 Applicability.
414.7 Eligibility.
Subpart B--Application Procedures
414.9 Pre-application consultation.
414.11 Application.
414.13 Confidentially.
414.15 Processing the initial application.
414.17 Maintaining the continued accuracy of the initial 
application.
Subpart C--Safety Approval Review and Issuance
414.19 Technical criteria for reviewing a safety approval 
application.
414.21 Terms and conditions for issuing a safety approval; duration 
of a safety approval.
414.23 Maintaining the continued accuracy of the safety approval 
application.
414.25 Safety approval records.
414.27 Safety approval renewal.
414.29 Safety approval transfer.
414.31 Monitoring compliance with the terms and conditions of a 
safety approval.
414.33 Modification, suspension, or revocation of a safety approval.
414.35 Public notification of the criteria by which a safety 
approval was issued.
Subpart D--Appeal Procedures
414.37 Hearings in safety approval actions.
414.39 Submissions; oral presentations in safety approval actions.
414.41 Administrative law judge's recommended decision in safety 
approval actions.

    Authority: 49 U.S.C. 106(g), 40113, 44701.

Subpart A--General


Sec.  414.1  Scope.

    This part establishes procedures for obtaining a safety approval 
and renewing and transferring an existing safety approval. Safety 
approvals issued under this part may be used to support the application 
review for one or more launch or reentry license requests under other 
parts of this chapter.


Sec.  414.3  Definitions.

    Safety approval. For purposes of this part, a safety approval is an 
FAA document containing the FAA determination that one or more of the 
safety elements listed in paragraphs (1) and (2) of this definition, 
when used or employed within a defined envelope, parameter, or 
situation, will not jeopardize public health and safety or safety of 
property. A safety approval may be issued independent of a license, and 
it does not confer any authority to conduct activities for which a 
license is required under 14 CFR Chapter III. A safety approval does 
not relieve its holder of the duty to comply with all applicable 
requirements of law or regulation that may apply to the holder's 
activities.
    (1) Launch vehicle, reentry vehicle, safety system, process, 
service, or any identified component thereof; or
    (2) Qualified and trained personnel, performing a process or 
function related to licensed launch activities or vehicles.
    Safety Element. For purposes of this part, a safety element is any 
one of the items or persons (personnel) listed in paragraphs (1) and 
(2) of the definition of ``safety approval'' in this section.


Sec.  414.5  Applicability.

    This part applies to an applicant that wants to obtain a safety 
approval for any of the safety elements defined under this part and to 
persons granted a safety approval under this part. Any person eligible 
under this part may apply to become the holder of a safety approval.


Sec.  414.7  Eligibility.

    (a) There is no citizenship requirement to obtain a safety 
approval.
    (b) You may be eligible for a safety approval if you are--
    (1) A manufacturer or designer of a launch or reentry vehicle or 
component thereof;
    (2) The designer or developer of a safety system or process; or
    (3) Personnel who perform safety critical functions in conducting a 
licensed launch or reentry.
    (c) A safety approval applicant must have sufficient knowledge and 
expertise to show that the design and operation of the safety element 
for which safety approval is sought qualify for a safety approval.
    (d) Only the safety elements defined under this part are eligible 
for a safety approval.

Subpart B--Application Procedures


Sec.  414.9  Pre-application consultation.

    The applicant must consult with the FAA before submitting an 
application. Unless the applicant or the FAA requests another form of 
consultation, consultation is oral discussion with the FAA about the 
application process and the potential issues relevant to the FAA's 
safety approval decision.


Sec.  414.11  Application.

    (a) The application must be in writing, in English, and filed in 
duplicate with the Federal Aviation Administration, Associate 
Administrator for Commercial Space Transportation, 800 Independence 
Avenue, SW., Washington, DC 20591.
    (b) The application must identify the following basic information:
    (1) Name and address of the applicant.
    (2) Name, address, and telephone number of any person to whom 
inquiries and correspondence should be directed.
    (3) Safety element (i.e., launch vehicle, reentry vehicle, safety 
system, process, service, or any identified component thereof; or 
personnel) for which the applicant seeks a safety approval.
    (c) The application must contain the following technical 
information:
    (1) A Statement of Conformance letter, describing the specific 
criteria the applicant used to show the adequacy of the safety element 
for which a safety approval is sought, and showing how the safety 
element complies with the specific criteria.
    (2) The specific operating limits for which the safety approval is 
sought.
    (3) The following as applicable:
    (i) Information and analyses required under this chapter that may 
be applicable to demonstrating safe performance of the safety element 
for which the safety approval is sought.
    (ii) Engineering design and analyses that show the adequacy of the 
proposed safety element for its intended use, such that the use in a 
licensed launch or reentry will not jeopardize public health or safety 
or the safety of property.
    (iii) Relevant manufacturing processes.
    (iv) Test and evaluation procedures.
    (v) Test results.
    (vi) Maintenance procedures.
    (vii) Personnel qualifications and training procedures.
    (d) The application must be in English, legibly signed, dated, and 
certified as true, complete, and accurate by one of the following:
    (1) For a corporation, an officer or other individual authorized to 
act for the corporation in licensing or safety approval matters.
    (2) For a partnership or a sole proprietorship, a general partner 
or proprietor, respectively.
    (3) For a joint venture, association, or other entity, an officer 
or other

[[Page 46854]]

individual duly authorized to act for the joint venture, association, 
or other entity in licensing matters.
    (e) Failure to comply with any of the requirements set forth in 
this section is sufficient basis for denial of a safety approval 
application.


Sec.  414.13  Confidentiality.

    (a) To ensure confidentiality of data or information in the 
application, the applicant must--
    (1) Send a written request with the application that trade secrets 
or proprietary commercial or financial data be treated as confidential, 
and include in the request the specific time frame confidential 
treatment is required.
    (2) Mark data or information that require confidentiality with an 
identifying legend, such as ``Proprietary Information,'' ``Proprietary 
Commercial Information,'' ``Trade Secret,'' or ``Confidential Treatment 
Requested.'' Where this marking proves impracticable, attach a cover 
sheet that contains the identifying legend to the data or information 
for which confidential treatment is sought.
    (b) If the applicant requests confidential treatment for previously 
submitted data or information, the FAA will honor that request to the 
extent practicable in case of any prior distribution of the data or 
information.
    (c) Data or information for which confidential treatment is 
requested or data or information that qualifies for exemption under 
section 552(b)(4) of Title 5, U.S.C., will not be disclosed to the 
public unless the Associate Administrator determines that withholding 
the data or information is contrary to the public or national interest.
    (d) If the proposed criteria for evaluating a safety approval is 
secret, as classified by the U.S. Government, or the applicant wants it 
to remain proprietary or confidential, it cannot be used as a basis for 
issuance of a safety approval.


Sec.  414.15  Processing the initial application.

    (a) The FAA will initially screen an application to determine if 
the application is sufficiently complete to enable the FAA to initiate 
the reviews or evaluations required under this part.
    (b) After completing the initial screening, the FAA will inform the 
applicant in writing of one of the following:
    (1) The FAA accepts the application and will begin the reviews or 
evaluations required for a safety approval determination under this 
part.
    (2) The FAA rejects the application because it is incomplete or 
indefinite making initiation of the reviews or evaluations required for 
a safety approval determination under this part inappropriate.
    (c) The written notice will state the reason(s) for rejection and 
corrective actions necessary for the application to be accepted. The 
FAA may return a rejected application to the applicant or may hold it 
until the applicant provides more information.
    (d) The applicant may withdraw, amend, or supplement an application 
anytime before the FAA makes a final determination on the safety 
approval application by making a written request to the Associate 
Administrator. If the applicant amends or supplements the initial 
application, the revised application must meet all the applicable 
requirements under this part.


Sec.  414.17  Maintaining the continued accuracy of the initial 
application.

    The applicant is responsible for the continuing accuracy and 
completeness of information provided to the FAA as part of the safety 
approval application. If at any time after submitting the application, 
circumstances occur that cause the information to no longer be accurate 
and complete in any material respect, the applicant must submit a 
written statement to the Associate Administrator explaining the 
circumstances and providing the new or corrected information. The 
revised application must meet all requirements under Sec.  414.11.

Subpart C--Safety Approval Review and Issuance


Sec.  414.19  Technical criteria for reviewing a safety approval 
application.

    (a) The FAA will determine whether a safety element is eligible for 
and may be issued a safety approval. We will base our determination on 
performance-based criteria, against which we may assess the effect on 
public health and safety and on safety of property, in the following 
hierarchy:
    (1) FAA or other appropriate Federal regulations.
    (2) Government-developed or adopted standards.
    (3) Industry consensus performance-based criteria or standard.
    (4) Applicant-developed criteria. Applicant-developed criteria are 
performance standards customized by the manufacturer that intends to 
produce the system, system component, or part. The applicant-developed 
criteria must define--
    (i) Design and minimum performance;
    (ii) Quality assurance system requirements;
    (iii) Production acceptance test specifications; and
    (iv) Continued operational safety monitoring system 
characteristics.
    (b) The applicant must allow the FAA to make its proposed safety 
approval criteria available to the public as part of the approval 
process.


Sec.  414.21  Terms and conditions for issuing a safety approval; 
duration of a safety approval.

    (a) The FAA will issue a safety approval to an applicant that meets 
all the requirements under this part.
    (b) The scope of the safety approval will be limited by the scope 
of the safety demonstration contained in the application on which the 
FAA based the decision to grant the safety approval.
    (c) The FAA will determine specific terms and conditions of a 
safety approval individually, limiting the safety approval to the scope 
for which the safety-approved launch or reentry element was approved. 
The terms and conditions will include reporting requirements tailored 
to the individual safety approval.
    (d) A safety approval is valid for five years and may be renewed.
    (e) If the FAA denies the application, the applicant may correct 
any deficiency the FAA identified and request a reconsideration of the 
revised application. The applicant also has the right to appeal a 
denial as set forth in subpart D of this part.


Sec.  414.23  Maintaining the continued accuracy of the safety approval 
application.

    (a) The holder of a safety approval must ensure the continued 
accuracy and completeness of representations contained in the safety 
approval application, on which the approval was issued, for the entire 
term of the safety approval.
    (b) If any representation contained in the application that is 
material to public health and safety or safety of property ceases to be 
accurate and complete, the safety approval holder must prepare and 
submit a revised application according to Sec.  414.11 under this part. 
The safety approval holder must point out any part of the safety 
approval or the associated application that would be changed or 
affected by a proposed modification. The FAA will review and make a 
determination on the revised application under the terms of this part.
    (c) If the FAA approves the revised application, the FAA will 
provide written notice to the holder, stating the terms and conditions 
to which the approval is subject.

[[Page 46855]]

Sec.  414.25  Safety approval records.

    The holder of a safety approval must maintain all records necessary 
to verify that the holder's activities are consistent with the 
representations contained in the application for which the approval was 
issued for the duration of the safety approval plus one year.


Sec.  414.27  Safety approval renewal.

    (a) Eligibility. A holder of a safety approval may apply to renew 
it by sending the FAA a written application at least 90 days before the 
expiration date of the approval.
    (b) Application. (1) A safety approval renewal application must 
meet all the requirements under Sec.  414.11.
    (2) The application may incorporate by reference information 
provided as part of the application for the expiring safety approval or 
any modification to that approval.
    (3) Any proposed changes in the conduct of a safety element for 
which the FAA has issued a safety approval must be described and must 
include any added information necessary to support the fitness of the 
proposed changes to meet the criteria upon which the FAA evaluated the 
safety approval application.
    (c) Review of application. The FAA conducts the reviews required 
under this part to determine whether the safety approval may be 
renewed. We may incorporate by reference any findings that are part of 
the record for the expiring safety approval.
    (d) Grant of safety approval renewal. If the FAA makes a favorable 
safety approval determination, the FAA issues an order that amends the 
expiration date of the safety approval or issues a new safety approval. 
The FAA may impose added or revised terms and conditions necessary to 
protect public health and safety and the safety of property.
    (e) Written notice. The FAA will provide written notice to the 
applicant of our determination on the safety approval renewal request.
    (f) Denial of a safety approval renewal. If the FAA denies the 
renewal application, the applicant may correct any deficiency the FAA 
identified and request a reconsideration of the revised application. 
The applicant also has the right to appeal a denial as set forth in 
subpart D of this part.


Sec.  414.29  Safety approval transfer.

    (a) Only the FAA may approve a transfer of a safety approval.
    (b) Either the holder of a safety approval or the prospective 
transferee may request a safety approval transfer.
    (c) Both the holder and prospective transferee must agree to the 
transfer.
    (d) The person requesting the transfer must submit a safety 
approval application according to Sec.  414.11, must meet the 
applicable requirements of this part, and may incorporate by reference 
relevant portions of the initial application.
    (e) The FAA will approve a transfer of a safety approval only after 
all the approvals and determinations required under this chapter for a 
safety approval have been met. In conducting reviews and issuing 
approvals and determinations, the FAA may incorporate by reference any 
findings made part of the record to support the initial safety approval 
determination. The FAA may modify the terms and conditions of a safety 
approval to reflect any changes necessary because of a safety approval 
transfer.
    (f) The FAA will provide written notice to the person requesting 
the safety approval transfer of our determination.
    (g) If the FAA denies a transfer request, the applicant may correct 
any deficiency the FAA identified and request a reconsideration of the 
revised application. The applicant also has the right to appeal a 
denial as set forth in subpart D of this part.


Sec.  414.31  Monitoring compliance with the terms and conditions of a 
safety approval.

    Each holder of a safety approval must allow access by, and 
cooperate with, Federal officers or employees or other individuals 
authorized by the Associate Administrator to inspect manufacturing, 
production, testing, or assembly performed by a holder of a safety 
approval or its contractor. The FAA may also inspect a safety approval 
process or service, including training programs and personnel 
qualifications.


Sec.  414.33  Modification, suspension, or revocation of a safety 
approval.

    (a) The safety approval holder. The safety approval holder may 
submit an application to the FAA to modify the terms and conditions of 
the holder's safety approval. The application must meet all the 
applicable requirements under this part. The FAA will review and make a 
determination on the application using the same procedures under this 
part applicable to an initial safety approval application. If the FAA 
denies the request to modify a safety approval, the holder may correct 
any deficiency the FAA identified and request reconsideration. The 
holder also has the right to appeal a denial as set forth in subpart D 
of this part.
    (b) The FAA. If the FAA finds it is in the interest of public 
health and safety, safety of property, or if the safety approval holder 
fails to comply with any applicable requirements of this part, any 
terms and conditions of the safety approval, or any other applicable 
requirement, the FAA may--
    (1) Modify the terms and conditions of the safety approval; or
    (2) Suspend or revoke the safety approval.
    (c) Effective Date. Unless otherwise stated by the FAA, any 
modification, suspension, or revocation of a safety approval under 
paragraph (b)--
    (1) Takes effect immediately; and
    (2) Continues in effect during any reconsideration or appeal of 
such action under this part.
    (d) Notification and Right to Appeal. If the FAA determines it is 
necessary to modify, suspend, or revoke a safety approval, we will 
notify the safety approval holder in writing. If the holder disagrees 
with the FAA's determination, the holder may correct any deficiency the 
FAA identi