Delegations to Bureau of Enforcement and Enforcement Procedures, 54037-54040 [2019-21640]

Download as PDF khammond on DSKJM1Z7X2PROD with RULES Federal Register / Vol. 84, No. 196 / Wednesday, October 9, 2019 / Rules and Regulations • Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999); • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997); • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001); • Is not subject to requirements of the National Technology Transfer and Advancement Act (NTTA) because this rulemaking does not involve technical standards; and • Does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994). In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. The EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a ‘‘major rule’’ as defined by 5 U.S.C. 804(2). Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by December 9, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be VerDate Sep<11>2014 15:56 Oct 08, 2019 Jkt 250001 challenged later in proceedings to enforce its requirements. (See section 307(b)(2)). List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds. Dated: September 30, 2019. James Gulliford, Regional Administrator, Region 7. For the reasons stated in the preamble, the EPA amends 40 CFR part 52 as set forth below: PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: ■ Authority: 42 U.S.C. 7401 et seq. Subpart AA—Missouri § 52.1320 [Amended] 2. In § 52.1320, the table in paragraph (c) is amended by removing the entry for ‘‘10–2.390’’ under the heading ‘‘Chapter 2—Air Quality Standards and Air Pollution Control Regulations for the Kansas City Metropolitan Area’’. ■ [FR Doc. 2019–21701 Filed 10–8–19; 8:45 am] BILLING CODE 6560–50–P FEDERAL MARITIME COMMISSION 46 CFR Parts 501 and 502 [Docket No. 19–07] RIN 3072–AC78 Delegations to Bureau of Enforcement and Enforcement Procedures Federal Maritime Commission. Direct final rule; request for comments. AGENCY: ACTION: The Federal Maritime Commission (Commission) is revising its delegations to the Bureau of Enforcement and its procedures for initiating enforcement action in order to facilitate Commission oversight. DATES: The rule is effective without further action on December 23, 2019, unless significant adverse comments are filed prior to November 8, 2019. If significant adverse comments are received, the Commission will publish a timely withdrawal of the rule in the SUMMARY: PO 00000 Frm 00043 Fmt 4700 Sfmt 4700 54037 Federal Register no later than November 25, 2019. ADDRESSES: You may submit comments, identified by Docket No. 19–07, by the following methods: • Email: secretary@fmc.gov. For comments, include in the subject line: ‘‘Docket No. 19–07, Comments on Delegations to Bureau of Enforcement and Enforcement Procedures.’’ Comments should be attached to the email as a Microsoft Word or textsearchable PDF document. Only nonconfidential and public versions of confidential comments should be submitted by email. • Mail: Rachel E. Dickon, Secretary, Federal Maritime Commission, 800 North Capitol Street NW, Washington, DC 20573–0001. Instructions: For detailed instructions on submitting comments, including requesting confidential treatment of comments, and additional information on the rulemaking process, see the Public Participation heading of the Supplementary Information section of this document. Note that all comments received will be posted without change to the Commission’s website, unless the commenter has requested confidential treatment. Docket: For access to the docket to read background documents or comments received, go to the Commission’s Electronic Reading Room at: https://www2.fmc.gov/readingroom/ proceeding/19–07/, or to the Docket Activity Library at 800 North Capitol Street NW, Washington, DC 20573, between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal holidays. Telephone: (202) 523–5725. FOR FURTHER INFORMATION CONTACT: Rachel E. Dickon, Secretary; Phone: (202) 523–5725; Email: secretary@ fmc.gov. SUPPLEMENTARY INFORMATION: I. Introduction The Commission’s Bureau of Enforcement (BOE) is responsible for investigating potential violations of the Shipping Act of 1984 and Commission regulations, and initiating enforcement actions. Such actions include formal Commission proceedings and informal compromises of civil penalties. While Commission approval is necessary to initiate formal Commission proceedings, BOE currently has broad delegated authority with respect to informal enforcement action. Specifically, BOE has the authority, with the approval of the Commission’s Managing Director, to send out Notice and Demand Letters (NDLs) describing alleged violations and demanding civil penalties, and to enter E:\FR\FM\09OCR1.SGM 09OCR1 54038 Federal Register / Vol. 84, No. 196 / Wednesday, October 9, 2019 / Rules and Regulations khammond on DSKJM1Z7X2PROD with RULES into agreements with the respondents compromising the penalties (compromise agreements). These activities may currently be conducted without input from or approval by the Commission, thereby denying the Commissioners—the policy officers for the Commission—the opportunity to provide ongoing oversight and guidance to BOE enforcement priorities or to approve final settlement agreements. In order to improve such oversight, the Commission is revising the delegations to BOE and the regulations governing formal enforcement action and informal compromise procedures. These revised procedures include a single pre-enforcement process that will: (1) Provide notice to the subjects of investigations that BOE intends to recommend that the Commission initiate enforcement proceedings and allow them an opportunity to respond before BOE submits those recommendations; (2) require Commission approval before formal or informal enforcement action is undertaken; and (3) require Commission approval of any proposed compromise agreements. II. Background The Commission regulations currently provide for two types of enforcement actions seeking civil penalties, formal enforcement action under 46 CFR 502.63 and informal compromise procedures under 46 CFR 502.604. Both types of actions begin with a BOE investigation of potential violations. BOE does not have delegated authority to initiate formal enforcement action under § 502.63; when BOE determines that such action is warranted, BOE recommends to the Commission that it issue an Order of Investigation and Hearing initiating an adjudicatory investigation before a Commission Administrative Law Judge. The Commission then votes on the recommendation. There is no current requirement, however, that BOE notify the subject of the investigation or allow them to submit their written views on the investigation prior to BOE making a recommendation to the Commission. BOE does, however, have delegated authority under §§ 501.5(i)(2), 501.28, and 502.604(g) to initiate informal compromise procedures under § 502.604, subject to the prior approval of the Commission’s Managing Director. Those procedures begin with the issuance of an NDL to the person believed to have committed one or more violations. See § 502.604(b). The NDL describes: (1) The specific violation(s) on which the claim is based, including VerDate Sep<11>2014 15:56 Oct 08, 2019 Jkt 250001 the particular facts, dates, and other elements necessary for the respondent to identify the specific conduct constituting the alleged violation; (2) the amount of the penalty demanded; (3) the availability of alternative dispute resolution; and (4) the names of Commission personnel with whom the demand may be discussed, if the person desires to compromise the penalty. Id. The NDL also states the deadlines for the institution and completion of compromise negotiations and the consequences of failure to compromise. Id. Any person receiving an NDL may, within the time period specified in the NDL, deny the violation or submit matters explaining, mitigating or showing extenuating circumstances, and may also make voluntary disclosures of information and documents. § 502.604(c). Civil penalties demanded by an NDL may be compromised based on specific criteria, and the person receiving the NDL may enter into a compromise agreement with the Commission that includes certain specified terms. § 502.604(d)–(e). BOE currently has delegated authority to negotiate the terms of compromise agreements, but both the BOE Director and the Managing Director must approve and sign the compromise agreement for it to be effective. § 502.604(g). III. Regulatory Changes As described briefly above, the Commission is amending its delegations of authority and enforcement procedures in order to increase Commission oversight over the institution of enforcement proceedings and to allow the subjects of investigations an opportunity to respond to BOE’s allegations prior to a recommendation for enforcement action being submitted to the Commission. This process is based on the Wells Process used by the Securities and Exchange Commission’s (SEC) Division of Enforcement. See SEC, Division of Enforcement, Enforcement Manual section 2.4 (Nov. 28, 2017).1 A. Delegation of Authority to BOE Similar to the current process for formal Commission enforcement action, the Commission is revising its delegations of authority in §§ 501.5(i), 501.28, and 502.604 to require Commission approval to initiate informal compromise procedures and Commission approval of any 1 Available at https://www.sec.gov/divisions/ enforce/enforcementmanual.pdf. PO 00000 Frm 00044 Fmt 4700 Sfmt 4700 compromise agreement before it becomes effective. B. Pre-Enforcement Process The Commission is adding a new paragraph to § 502.63 to reflect a new pre-enforcement process that includes notice to the subject of an investigation that BOE is planning to recommend that the Commission initiate enforcement action, and an opportunity for the subject of the investigation to submit a written statement to BOE that will be included in BOE’s recommendation to the Commission. The regulatory changes are intended to provide a basic framework for the new process; the Commission may issue additional guidance or internal enforcement policies to facilitate implementation. Because the new process includes notice and an opportunity to respond, the Commission is eliminating the NDL and response provisions in § 502.604(b) and (c) as duplicative. The Commission is making other conforming amendments to §§ 502.603 and 502.604 to reflect the changes in § 502.63. IV. Public Participation How do I prepare and submit comments? Your comments must be written and in English. To ensure that your comments are correctly filed in the docket, please include the docket number of this document in your comments. You may submit your comments via email to the email address listed above under ADDRESSES. Please include the docket number associated with this notice and the subject matter in the subject line of the email. Comments should be attached to the email as a Microsoft Word or text-searchable PDF document. Only non-confidential and public versions of confidential comments should be submitted by email. You may also submit comments by mail to the address listed above under ADDRESSES. How do I submit confidential business information? The Commission will provide confidential treatment for identified confidential information to the extent allowed by law. If your comments contain confidential information, you must submit the following by mail to the address listed above under ADDRESSES: • A transmittal letter requesting confidential treatment that identifies the specific information in the comments for which protection is sought and E:\FR\FM\09OCR1.SGM 09OCR1 Federal Register / Vol. 84, No. 196 / Wednesday, October 9, 2019 / Rules and Regulations demonstrates that the information is a trade secret or other confidential research, development, or commercial information. • A confidential copy of your comments, consisting of the complete filing with a cover page marked ‘‘Confidential-Restricted,’’ and the confidential material clearly marked on each page. You should submit the confidential copy to the Commission by mail. • A public version of your comments with the confidential information excluded. The public version must state ‘‘Public Version—confidential materials excluded’’ on the cover page and on each affected page, and must clearly indicate any information withheld. You may submit the public version to the Commission by email or mail. Will the Commission consider late comments? The Commission will consider all comments received before the close of business on the comment closing date indicated above under DATES. Because this is a direct final rule that will go into effect as specified in the DATES section in the absence of significant adverse comment received during the comment period, the Commission will not consider any comments filed after the comment closing date. How can I read comments submitted by other people? You may read the comments received by the Commission at the Commission’s Electronic Reading Room or the Docket Activity Library at the addresses listed above under ADDRESSES. V. Rulemaking Analyses and Notices khammond on DSKJM1Z7X2PROD with RULES Direct Final Rule Justification Under the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(A), rules of agency organization, procedure, or practice do not require notice and comment. This direct final rule relates to the Commission’s organization, procedures, and practices; it revises internal Commission delegations of authority to BOE and the regulations governing enforcement procedures. This rule will therefore become effective on the date listed in the DATES section, unless the Commission receives significant adverse comments within the specified period. The Commission recognizes that parties may have information that could impact the Commission’s views and intentions with respect to the revised regulations, and the Commission intends to consider any comments filed. Filed comments that are not adverse may be considered VerDate Sep<11>2014 15:56 Oct 08, 2019 Jkt 250001 for modifications to the Commission’s regulations at a future date. If no significant adverse comments are received, the rule will become effective without additional action by the Commission. If significant adverse comments are received, the Commission will withdraw the rule by the date specified in the DATES section. Congressional Review Act The direct final rule is not a ‘‘rule’’ as defined by the Congressional Review Act (CRA), codified at 5 U.S.C. 801 et seq., and is not subject to the provisions of the CRA. The CRA adopts the Administrative Procedure Act’s definition of a ‘‘rule’’ in 5 U.S.C. 551, subject to certain exclusions. See 5 U.S.C. 804(3). In particular, the CRA does not apply to rules relating to agency management and personnel and rules of agency organization, procedure, and practice that do not substantially affect the rights or obligations of nonagency parties. Id. This direct final rule relates to agency management and personnel as well as agency organization, procedures, and practices. Specifically, the direct final rule revises internal Commission delegations of authority to BOE and the regulations governing enforcement procedures. The only effect the changes have with respect to non-agency parties is to provide parties with notice of alleged violations and an opportunity to respond prior to the initiation of enforcement action by the Commission. The Commission already provides notice and an opportunity to respond in both formal and informal enforcement procedures. For formal enforcement action, the rule merely adds an additional opportunity for parties to respond prior to the Commission decision on whether to initiate enforcement action. For informal compromise actions, the rule merely shifts the timing of the notice and opportunity for response so that these steps occur prior to the Commission’s decision to pursue a compromise agreement. Accordingly, although the direct final rule may affect the timing and manner of non-agency parties’ interactions with the Commission, it does not affect their underlying rights and obligations under the Shipping Act and the Commission’s regulations. Therefore, the direct final rule is not a ‘‘rule’’ under the CRA and is not subject to the CRA’s requirements. Regulatory Flexibility Act The Regulatory Flexibility Act (codified as amended at 5 U.S.C. 601– 612) provides that whenever an agency promulgates a final rule after being PO 00000 Frm 00045 Fmt 4700 Sfmt 4700 54039 required to publish a notice of proposed rulemaking under the APA (5 U.S.C. 553), the agency must prepare and make available a final regulatory flexibility analysis (FRFA) describing the impact of the rule on small entities. 5 U.S.C. 604. An agency is not required to publish an FRFA, however, for the following types of rules, which are excluded from the APA’s notice-andcomment requirement: interpretative rules; general statements of policy; rules of agency organization, procedure, or practice; and rules for which the agency for good cause finds that notice and comment is impracticable, unnecessary, or contrary to public interest. See 5 U.S.C. 553(b). As discussed above, this direct final rule is a rule of agency organization, procedure, or practice. Therefore, the APA does not require publication of a notice of proposed rulemaking in this instance, and the Commission is not required to prepare an FRFA. National Environmental Policy Act The Commission’s regulations categorically exclude certain rulemakings from any requirement to prepare an environmental assessment or an environmental impact statement because they do not increase or decrease air, water or noise pollution or the use of fossil fuels, recyclables, or energy. 46 CFR 504.4. The direct final rule revises internal Commission delegations of authority to BOE and the regulations governing enforcement procedures with respect to potential Shipping Act violations. This rulemaking thus falls within the categorical exclusions for procedural rules pursuant to 46 CFR part 502 (§ 504.4(a)(4)), investigatory and adjudicatory proceedings, the purpose of which is to ascertain past violations of the Shipping Act of 1984 (§ 504.4(a)(22)), and matters related to Commission personnel (§ 504.4(a)(28)). Therefore, no environmental assessment or environmental impact statement is required. Paperwork Reduction Act The Paperwork Reduction Act of 1995 (44 U.S.C. 3501–3521) (PRA) requires an agency to seek and receive approval from the Office of Management and Budget (OMB) before collecting information from the public. 44 U.S.C. 3507. The agency must submit collections of information in rules to OMB in conjunction with the publication of the notice of proposed rulemaking. 5 CFR 1320.11. This direct final rule does not contain any collections of information as defined by 44 U.S.C. 3502(3) and 5 CFR 1320.3(c). E:\FR\FM\09OCR1.SGM 09OCR1 54040 Federal Register / Vol. 84, No. 196 / Wednesday, October 9, 2019 / Rules and Regulations Executive Order 12988 (Civil Justice Reform) This rule meets the applicable standards in E.O. 12988 titled, ‘‘Civil Justice Reform,’’ to minimize litigation, eliminate ambiguity, and reduce burden. Regulation Identifier Number The Commission assigns a regulation identifier number (RIN) to each regulatory action listed in the Unified Agenda of Federal Regulatory and Deregulatory Actions (Unified Agenda). The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading at the beginning of this document to find this action in the Unified Agenda, available at http:// www.reginfo.gov/public/do/ eAgendaMain. List of Subjects 46 CFR Part 501 Administrative practice and procedure, Authority delegations (Government agencies), Organization and functions (Government agencies). 46 CFR Part 502 Administrative practice and procedure, Claims, Equal access to justice, Investigations, Lawyers, Maritime carriers, Penalties, Reporting and recordkeeping requirements. For the reasons set forth above, the Federal Maritime Commission amends 46 CFR parts 501 and 502 as follows: PART 501—THE FEDERAL MARITIME COMMISSION—GENERAL 1. The authority citation for part 501 continues to read as follows: ■ Authority: 5 U.S.C. 551–557, 701–706, 2903 and 6304; 31 U.S.C. 3721; 41 U.S.C. 414 and 418; 44 U.S.C. 501–520 and 3501–3520; 46 U.S.C. 301–307, 40101–41309, 42101– 42109, 44101–44106; Pub. L. 89–56, 70 Stat. 195; 5 CFR part 2638; Pub. L. 104–320, 110 Stat. 3870. 2. Amend § 501.5 by: a. Revising paragraph (i)(2); b. Redesignating paragraphs (i)(4) and (5) as paragraphs (i)(3) and (4), respectively; and ■ c. Revising newly redesignated paragraphs (i)(3) and (4). The revisions read as follows: khammond on DSKJM1Z7X2PROD with RULES ■ ■ ■ § 501.5 Functions of the organizational components of the Federal Maritime Commission. * * * * * (i) * * * (2) Subject to the prior approval of the Commission, negotiates the informal VerDate Sep<11>2014 15:56 Oct 08, 2019 Jkt 250001 compromise of civil penalties under § 502.604 of this chapter, prepares and presents compromise agreements for Commission approval, and represents the Commission in proceedings and circumstances as designated; (3) Subject to consultation with and guidance of the General Counsel, coordinates with other bureaus and offices to provide legal advice, attorney liaison, and prosecution, as warranted, in connection with enforcement matters; and (4) Conducts investigations and recommends enforcement action. * * * * * § 501.28 ■ [Removed] PART 502—RULES OF PRACTICE AND PROCEDURE 4. The authority citation for part 502 continues to read as follows: ■ Authority: 5 U.S.C. 504, 551, 552, 553, 556(c), 559, 561–569, 571–596; 5 U.S.C. 571– 584; 18 U.S.C. 207; 28 U.S.C. 2112(a); 31 U.S.C. 9701; 46 U.S.C. 305, 40103–40104, 40304, 40306, 40501–40503, 40701–40706, 41101–41109, 41301–41309, 44101–44106; 5 CFR part 2635. 5. Amend § 502.63 by revising paragraph (c)(4)(ii) and adding paragraph (d) to read as follows: ■ Commission enforcement action. * * * * * (c) * * * (4) * * * (ii) The Bureau of Enforcement may make a motion for decision on default. (d) Pre-enforcement process. (1) Prior to recommending formal enforcement action under this section or informal compromise procedures under § 502.604, the Bureau of Enforcement will advise the person or persons who are the subject of an investigation that: (i) The Bureau of Enforcement has made a preliminary determination to recommend that the Commission initiate enforcement action against them; (ii) Identifies the specific violations that the Bureau of Enforcement has preliminarily determined to include in the recommendation; and (iii) Provides notice that the person may make a written submission to the Bureau of Enforcement concerning the proposed recommendation, including the deadline for the submission and any other relevant information (e.g., how and where to send such statements). (2) Persons notified of such investigations may submit a written statement to the Bureau of Enforcement setting forth their interests and positions PO 00000 Frm 00046 Fmt 4700 § 502.603 [Amended] 6. Amend § 502.603(c) by removing the citation ‘‘§ 502.604(e)’’ and adding in its place the citation ‘‘§ 502.604’’. ■ 7. Amend § 502.604 by: a. Revising paragraph (a); ■ b. Removing paragraphs (b), (c), and (g); and ■ c. Redesignating paragraphs (d), (e), and (f) as paragraphs (b), (c), and (d), respectively. The revision reads as follows: ■ ■ 3. Remove § 501.28 § 502.63 regarding the subject matter of the investigation. (3) The Bureau of Enforcement will consider any written statements submitted under paragraph (d)(2) of this section when making recommendations to the Commission and will attach such written statements to the Bureau’s recommendations. [Rule 63.] Sfmt 4700 § 502.604 Compromise of penalties: Relation to assessment proceedings. (a) Scope. Except in pending civil penalty assessment proceedings provided for in § 502.603, the Commission, when it has reason to believe a violation has occurred, may invoke the informal compromise procedures of this section after observing the procedures in § 502.63(d). * * * * * By the Commission. Rachel Dickon, Secretary. [FR Doc. 2019–21640 Filed 10–8–19; 8:45 am] BILLING CODE 6731–AA–P FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 0 Commission Organization CFR Correction In Title 47 of the Code of Federal Regulations, parts 0 to 59, revised as of October 1, 2018, on page 7, in part 0, the authority citation is corrected to read as follows: ■ Authority: 47 U.S.C. 155, 225, unless otherwise noted. And on the same page, in the same part, the authority citation for Subpart A is reinstated to read as follows: ■ Authority: Secs. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155. [FR Doc. 2019–22249 Filed 10–8–19; 8:45 am] BILLING CODE 1301–00–D E:\FR\FM\09OCR1.SGM 09OCR1

Agencies

[Federal Register Volume 84, Number 196 (Wednesday, October 9, 2019)]
[Rules and Regulations]
[Pages 54037-54040]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-21640]


=======================================================================
-----------------------------------------------------------------------

FEDERAL MARITIME COMMISSION

46 CFR Parts 501 and 502

[Docket No. 19-07]
RIN 3072-AC78


Delegations to Bureau of Enforcement and Enforcement Procedures

AGENCY: Federal Maritime Commission.

ACTION: Direct final rule; request for comments.

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

SUMMARY: The Federal Maritime Commission (Commission) is revising its 
delegations to the Bureau of Enforcement and its procedures for 
initiating enforcement action in order to facilitate Commission 
oversight.

DATES: The rule is effective without further action on December 23, 
2019, unless significant adverse comments are filed prior to November 
8, 2019. If significant adverse comments are received, the Commission 
will publish a timely withdrawal of the rule in the Federal Register no 
later than November 25, 2019.

ADDRESSES: You may submit comments, identified by Docket No. 19-07, by 
the following methods:
     Email: [email protected]. For comments, include in the 
subject line: ``Docket No. 19-07, Comments on Delegations to Bureau of 
Enforcement and Enforcement Procedures.'' Comments should be attached 
to the email as a Microsoft Word or text-searchable PDF document. Only 
non-confidential and public versions of confidential comments should be 
submitted by email.
     Mail: Rachel E. Dickon, Secretary, Federal Maritime 
Commission, 800 North Capitol Street NW, Washington, DC 20573-0001.
    Instructions: For detailed instructions on submitting comments, 
including requesting confidential treatment of comments, and additional 
information on the rulemaking process, see the Public Participation 
heading of the Supplementary Information section of this document. Note 
that all comments received will be posted without change to the 
Commission's website, unless the commenter has requested confidential 
treatment.
    Docket: For access to the docket to read background documents or 
comments received, go to the Commission's Electronic Reading Room at: 
https://www2.fmc.gov/readingroom/proceeding/19-07/, or to the Docket 
Activity Library at 800 North Capitol Street NW, Washington, DC 20573, 
between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal 
holidays. Telephone: (202) 523-5725.

FOR FURTHER INFORMATION CONTACT: Rachel E. Dickon, Secretary; Phone: 
(202) 523-5725; Email: [email protected].

SUPPLEMENTARY INFORMATION: 

I. Introduction

    The Commission's Bureau of Enforcement (BOE) is responsible for 
investigating potential violations of the Shipping Act of 1984 and 
Commission regulations, and initiating enforcement actions. Such 
actions include formal Commission proceedings and informal compromises 
of civil penalties. While Commission approval is necessary to initiate 
formal Commission proceedings, BOE currently has broad delegated 
authority with respect to informal enforcement action. Specifically, 
BOE has the authority, with the approval of the Commission's Managing 
Director, to send out Notice and Demand Letters (NDLs) describing 
alleged violations and demanding civil penalties, and to enter

[[Page 54038]]

into agreements with the respondents compromising the penalties 
(compromise agreements).
    These activities may currently be conducted without input from or 
approval by the Commission, thereby denying the Commissioners--the 
policy officers for the Commission--the opportunity to provide ongoing 
oversight and guidance to BOE enforcement priorities or to approve 
final settlement agreements. In order to improve such oversight, the 
Commission is revising the delegations to BOE and the regulations 
governing formal enforcement action and informal compromise procedures.
    These revised procedures include a single pre-enforcement process 
that will: (1) Provide notice to the subjects of investigations that 
BOE intends to recommend that the Commission initiate enforcement 
proceedings and allow them an opportunity to respond before BOE submits 
those recommendations; (2) require Commission approval before formal or 
informal enforcement action is undertaken; and (3) require Commission 
approval of any proposed compromise agreements.

II. Background

    The Commission regulations currently provide for two types of 
enforcement actions seeking civil penalties, formal enforcement action 
under 46 CFR 502.63 and informal compromise procedures under 46 CFR 
502.604. Both types of actions begin with a BOE investigation of 
potential violations.
    BOE does not have delegated authority to initiate formal 
enforcement action under Sec.  502.63; when BOE determines that such 
action is warranted, BOE recommends to the Commission that it issue an 
Order of Investigation and Hearing initiating an adjudicatory 
investigation before a Commission Administrative Law Judge. The 
Commission then votes on the recommendation. There is no current 
requirement, however, that BOE notify the subject of the investigation 
or allow them to submit their written views on the investigation prior 
to BOE making a recommendation to the Commission.
    BOE does, however, have delegated authority under Sec. Sec.  
501.5(i)(2), 501.28, and 502.604(g) to initiate informal compromise 
procedures under Sec.  502.604, subject to the prior approval of the 
Commission's Managing Director. Those procedures begin with the 
issuance of an NDL to the person believed to have committed one or more 
violations. See Sec.  502.604(b). The NDL describes: (1) The specific 
violation(s) on which the claim is based, including the particular 
facts, dates, and other elements necessary for the respondent to 
identify the specific conduct constituting the alleged violation; (2) 
the amount of the penalty demanded; (3) the availability of alternative 
dispute resolution; and (4) the names of Commission personnel with whom 
the demand may be discussed, if the person desires to compromise the 
penalty. Id. The NDL also states the deadlines for the institution and 
completion of compromise negotiations and the consequences of failure 
to compromise. Id.
    Any person receiving an NDL may, within the time period specified 
in the NDL, deny the violation or submit matters explaining, mitigating 
or showing extenuating circumstances, and may also make voluntary 
disclosures of information and documents. Sec.  502.604(c). Civil 
penalties demanded by an NDL may be compromised based on specific 
criteria, and the person receiving the NDL may enter into a compromise 
agreement with the Commission that includes certain specified terms. 
Sec.  502.604(d)-(e). BOE currently has delegated authority to 
negotiate the terms of compromise agreements, but both the BOE Director 
and the Managing Director must approve and sign the compromise 
agreement for it to be effective. Sec.  502.604(g).

III. Regulatory Changes

    As described briefly above, the Commission is amending its 
delegations of authority and enforcement procedures in order to 
increase Commission oversight over the institution of enforcement 
proceedings and to allow the subjects of investigations an opportunity 
to respond to BOE's allegations prior to a recommendation for 
enforcement action being submitted to the Commission. This process is 
based on the Wells Process used by the Securities and Exchange 
Commission's (SEC) Division of Enforcement. See SEC, Division of 
Enforcement, Enforcement Manual section 2.4 (Nov. 28, 2017).\1\
---------------------------------------------------------------------------

    \1\ Available at https://www.sec.gov/divisions/enforce/enforcementmanual.pdf.
---------------------------------------------------------------------------

A. Delegation of Authority to BOE

    Similar to the current process for formal Commission enforcement 
action, the Commission is revising its delegations of authority in 
Sec. Sec.  501.5(i), 501.28, and 502.604 to require Commission approval 
to initiate informal compromise procedures and Commission approval of 
any compromise agreement before it becomes effective.

B. Pre-Enforcement Process

    The Commission is adding a new paragraph to Sec.  502.63 to reflect 
a new pre-enforcement process that includes notice to the subject of an 
investigation that BOE is planning to recommend that the Commission 
initiate enforcement action, and an opportunity for the subject of the 
investigation to submit a written statement to BOE that will be 
included in BOE's recommendation to the Commission. The regulatory 
changes are intended to provide a basic framework for the new process; 
the Commission may issue additional guidance or internal enforcement 
policies to facilitate implementation.
    Because the new process includes notice and an opportunity to 
respond, the Commission is eliminating the NDL and response provisions 
in Sec.  502.604(b) and (c) as duplicative. The Commission is making 
other conforming amendments to Sec. Sec.  502.603 and 502.604 to 
reflect the changes in Sec.  502.63.

IV. Public Participation

How do I prepare and submit comments?

    Your comments must be written and in English. To ensure that your 
comments are correctly filed in the docket, please include the docket 
number of this document in your comments.
    You may submit your comments via email to the email address listed 
above under ADDRESSES. Please include the docket number associated with 
this notice and the subject matter in the subject line of the email. 
Comments should be attached to the email as a Microsoft Word or text-
searchable PDF document. Only non-confidential and public versions of 
confidential comments should be submitted by email.
    You may also submit comments by mail to the address listed above 
under ADDRESSES.

How do I submit confidential business information?

    The Commission will provide confidential treatment for identified 
confidential information to the extent allowed by law. If your comments 
contain confidential information, you must submit the following by mail 
to the address listed above under ADDRESSES:
     A transmittal letter requesting confidential treatment 
that identifies the specific information in the comments for which 
protection is sought and

[[Page 54039]]

demonstrates that the information is a trade secret or other 
confidential research, development, or commercial information.
     A confidential copy of your comments, consisting of the 
complete filing with a cover page marked ``Confidential-Restricted,'' 
and the confidential material clearly marked on each page. You should 
submit the confidential copy to the Commission by mail.
     A public version of your comments with the confidential 
information excluded. The public version must state ``Public Version--
confidential materials excluded'' on the cover page and on each 
affected page, and must clearly indicate any information withheld. You 
may submit the public version to the Commission by email or mail.

Will the Commission consider late comments?

    The Commission will consider all comments received before the close 
of business on the comment closing date indicated above under DATES. 
Because this is a direct final rule that will go into effect as 
specified in the DATES section in the absence of significant adverse 
comment received during the comment period, the Commission will not 
consider any comments filed after the comment closing date.

How can I read comments submitted by other people?

    You may read the comments received by the Commission at the 
Commission's Electronic Reading Room or the Docket Activity Library at 
the addresses listed above under ADDRESSES.

V. Rulemaking Analyses and Notices

Direct Final Rule Justification

    Under the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(A), 
rules of agency organization, procedure, or practice do not require 
notice and comment. This direct final rule relates to the Commission's 
organization, procedures, and practices; it revises internal Commission 
delegations of authority to BOE and the regulations governing 
enforcement procedures.
    This rule will therefore become effective on the date listed in the 
DATES section, unless the Commission receives significant adverse 
comments within the specified period. The Commission recognizes that 
parties may have information that could impact the Commission's views 
and intentions with respect to the revised regulations, and the 
Commission intends to consider any comments filed. Filed comments that 
are not adverse may be considered for modifications to the Commission's 
regulations at a future date. If no significant adverse comments are 
received, the rule will become effective without additional action by 
the Commission. If significant adverse comments are received, the 
Commission will withdraw the rule by the date specified in the DATES 
section.

Congressional Review Act

    The direct final rule is not a ``rule'' as defined by the 
Congressional Review Act (CRA), codified at 5 U.S.C. 801 et seq., and 
is not subject to the provisions of the CRA. The CRA adopts the 
Administrative Procedure Act's definition of a ``rule'' in 5 U.S.C. 
551, subject to certain exclusions. See 5 U.S.C. 804(3). In particular, 
the CRA does not apply to rules relating to agency management and 
personnel and rules of agency organization, procedure, and practice 
that do not substantially affect the rights or obligations of non-
agency parties. Id. This direct final rule relates to agency management 
and personnel as well as agency organization, procedures, and 
practices. Specifically, the direct final rule revises internal 
Commission delegations of authority to BOE and the regulations 
governing enforcement procedures. The only effect the changes have with 
respect to non-agency parties is to provide parties with notice of 
alleged violations and an opportunity to respond prior to the 
initiation of enforcement action by the Commission. The Commission 
already provides notice and an opportunity to respond in both formal 
and informal enforcement procedures. For formal enforcement action, the 
rule merely adds an additional opportunity for parties to respond prior 
to the Commission decision on whether to initiate enforcement action. 
For informal compromise actions, the rule merely shifts the timing of 
the notice and opportunity for response so that these steps occur prior 
to the Commission's decision to pursue a compromise agreement. 
Accordingly, although the direct final rule may affect the timing and 
manner of non-agency parties' interactions with the Commission, it does 
not affect their underlying rights and obligations under the Shipping 
Act and the Commission's regulations. Therefore, the direct final rule 
is not a ``rule'' under the CRA and is not subject to the CRA's 
requirements.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (codified as amended at 5 U.S.C. 
601-612) provides that whenever an agency promulgates a final rule 
after being required to publish a notice of proposed rulemaking under 
the APA (5 U.S.C. 553), the agency must prepare and make available a 
final regulatory flexibility analysis (FRFA) describing the impact of 
the rule on small entities. 5 U.S.C. 604. An agency is not required to 
publish an FRFA, however, for the following types of rules, which are 
excluded from the APA's notice-and-comment requirement: interpretative 
rules; general statements of policy; rules of agency organization, 
procedure, or practice; and rules for which the agency for good cause 
finds that notice and comment is impracticable, unnecessary, or 
contrary to public interest. See 5 U.S.C. 553(b).
    As discussed above, this direct final rule is a rule of agency 
organization, procedure, or practice. Therefore, the APA does not 
require publication of a notice of proposed rulemaking in this 
instance, and the Commission is not required to prepare an FRFA.

National Environmental Policy Act

    The Commission's regulations categorically exclude certain 
rulemakings from any requirement to prepare an environmental assessment 
or an environmental impact statement because they do not increase or 
decrease air, water or noise pollution or the use of fossil fuels, 
recyclables, or energy. 46 CFR 504.4. The direct final rule revises 
internal Commission delegations of authority to BOE and the regulations 
governing enforcement procedures with respect to potential Shipping Act 
violations. This rulemaking thus falls within the categorical 
exclusions for procedural rules pursuant to 46 CFR part 502 (Sec.  
504.4(a)(4)), investigatory and adjudicatory proceedings, the purpose 
of which is to ascertain past violations of the Shipping Act of 1984 
(Sec.  504.4(a)(22)), and matters related to Commission personnel 
(Sec.  504.4(a)(28)). Therefore, no environmental assessment or 
environmental impact statement is required.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA) 
requires an agency to seek and receive approval from the Office of 
Management and Budget (OMB) before collecting information from the 
public. 44 U.S.C. 3507. The agency must submit collections of 
information in rules to OMB in conjunction with the publication of the 
notice of proposed rulemaking. 5 CFR 1320.11. This direct final rule 
does not contain any collections of information as defined by 44 U.S.C. 
3502(3) and 5 CFR 1320.3(c).

[[Page 54040]]

Executive Order 12988 (Civil Justice Reform)

    This rule meets the applicable standards in E.O. 12988 titled, 
``Civil Justice Reform,'' to minimize litigation, eliminate ambiguity, 
and reduce burden.

Regulation Identifier Number

    The Commission assigns a regulation identifier number (RIN) to each 
regulatory action listed in the Unified Agenda of Federal Regulatory 
and Deregulatory Actions (Unified Agenda). The Regulatory Information 
Service Center publishes the Unified Agenda in April and October of 
each year. You may use the RIN contained in the heading at the 
beginning of this document to find this action in the Unified Agenda, 
available at http://www.reginfo.gov/public/do/eAgendaMain.

List of Subjects

46 CFR Part 501

    Administrative practice and procedure, Authority delegations 
(Government agencies), Organization and functions (Government 
agencies).

46 CFR Part 502

    Administrative practice and procedure, Claims, Equal access to 
justice, Investigations, Lawyers, Maritime carriers, Penalties, 
Reporting and recordkeeping requirements.
    For the reasons set forth above, the Federal Maritime Commission 
amends 46 CFR parts 501 and 502 as follows:

PART 501--THE FEDERAL MARITIME COMMISSION--GENERAL

0
 1. The authority citation for part 501 continues to read as follows:

    Authority:  5 U.S.C. 551-557, 701-706, 2903 and 6304; 31 U.S.C. 
3721; 41 U.S.C. 414 and 418; 44 U.S.C. 501-520 and 3501-3520; 46 
U.S.C. 301-307, 40101-41309, 42101-42109, 44101-44106; Pub. L. 89-
56, 70 Stat. 195; 5 CFR part 2638; Pub. L. 104-320, 110 Stat. 3870.


0
2. Amend Sec.  501.5 by:
0
 a. Revising paragraph (i)(2);
0
b. Redesignating paragraphs (i)(4) and (5) as paragraphs (i)(3) and 
(4), respectively; and
0
 c. Revising newly redesignated paragraphs (i)(3) and (4).
    The revisions read as follows:


Sec.  501.5  Functions of the organizational components of the Federal 
Maritime Commission.

* * * * *
    (i) * * *
    (2) Subject to the prior approval of the Commission, negotiates the 
informal compromise of civil penalties under Sec.  502.604 of this 
chapter, prepares and presents compromise agreements for Commission 
approval, and represents the Commission in proceedings and 
circumstances as designated;
    (3) Subject to consultation with and guidance of the General 
Counsel, coordinates with other bureaus and offices to provide legal 
advice, attorney liaison, and prosecution, as warranted, in connection 
with enforcement matters; and
    (4) Conducts investigations and recommends enforcement action.
* * * * *


Sec.  501.28  [Removed]

0
3. Remove Sec.  501.28

PART 502--RULES OF PRACTICE AND PROCEDURE

0
4. The authority citation for part 502 continues to read as follows:

    Authority:  5 U.S.C. 504, 551, 552, 553, 556(c), 559, 561-569, 
571-596; 5 U.S.C. 571-584; 18 U.S.C. 207; 28 U.S.C. 2112(a); 31 
U.S.C. 9701; 46 U.S.C. 305, 40103-40104, 40304, 40306, 40501-40503, 
40701-40706, 41101-41109, 41301-41309, 44101-44106; 5 CFR part 2635.


0
5. Amend Sec.  502.63 by revising paragraph (c)(4)(ii) and adding 
paragraph (d) to read as follows:


Sec.  502.63  Commission enforcement action.

* * * * *
    (c) * * *
    (4) * * *
    (ii) The Bureau of Enforcement may make a motion for decision on 
default.
    (d) Pre-enforcement process. (1) Prior to recommending formal 
enforcement action under this section or informal compromise procedures 
under Sec.  502.604, the Bureau of Enforcement will advise the person 
or persons who are the subject of an investigation that:
    (i) The Bureau of Enforcement has made a preliminary determination 
to recommend that the Commission initiate enforcement action against 
them;
    (ii) Identifies the specific violations that the Bureau of 
Enforcement has preliminarily determined to include in the 
recommendation; and
    (iii) Provides notice that the person may make a written submission 
to the Bureau of Enforcement concerning the proposed recommendation, 
including the deadline for the submission and any other relevant 
information (e.g., how and where to send such statements).
    (2) Persons notified of such investigations may submit a written 
statement to the Bureau of Enforcement setting forth their interests 
and positions regarding the subject matter of the investigation.
    (3) The Bureau of Enforcement will consider any written statements 
submitted under paragraph (d)(2) of this section when making 
recommendations to the Commission and will attach such written 
statements to the Bureau's recommendations. [Rule 63.]


Sec.  502.603  [Amended]

0
6. Amend Sec.  [thinsp]502.603(c) by removing the citation ``Sec.  
[thinsp]502.604(e)'' and adding in its place the citation ``Sec.  
[thinsp]502.604''.

0
7. Amend Sec.  502.604 by:
0
a. Revising paragraph (a);
0
 b. Removing paragraphs (b), (c), and (g); and
0
 c. Redesignating paragraphs (d), (e), and (f) as paragraphs (b), (c), 
and (d), respectively.
    The revision reads as follows:


Sec.  502.604  Compromise of penalties: Relation to assessment 
proceedings.

    (a) Scope. Except in pending civil penalty assessment proceedings 
provided for in Sec.  502.603, the Commission, when it has reason to 
believe a violation has occurred, may invoke the informal compromise 
procedures of this section after observing the procedures in Sec.  
502.63(d).
* * * * *

    By the Commission.
Rachel Dickon,
 Secretary.
[FR Doc. 2019-21640 Filed 10-8-19; 8:45 am]
 BILLING CODE 6731-AA-P