Procedures for Exemption From Service Contract Regulatory Requirements, 23227-23229 [2020-09003]

Agencies

• Federal Maritime Commission

[Federal Register Volume 85, Number 81 (Monday, April 27, 2020)]
[Rules and Regulations]
[Pages 23227-23229]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-09003]


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FEDERAL MARITIME COMMISSION

46 CFR Part 530

[Docket No. 20-05]
RIN 3072-AC81


Procedures for Exemption From Service Contract Regulatory 
Requirements

AGENCY: Federal Maritime Commission.

ACTION: Final rule.

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SUMMARY: The Federal Maritime Commission is revising its procedures for 
exemptions from the regulatory requirements for service contracts to 
allow such exemptions to be granted without providing an opportunity 
for a hearing.

DATES: This final rule is effective April 27, 2020.

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

SUPPLEMENTARY INFORMATION: The Commission's service contract 
regulations in 46 CFR part 530 provide that exemptions from the 
requirements of that part are governed by 46 U.S.C. 40103 and the 
exemption procedures in 46 CFR part 502. See 46 CFR 530.13(b).\1\ 
Section 40103 provides that the Commission may grant an exemption from 
statutory requirements if the Commission finds that the exemption will 
not result in substantial reduction in competition or be detrimental to 
commerce, and the Commission may attach conditions to an exemption. 
Section 40103(a). Section 40103 also requires that a statutory 
exemption may be issued only if the Commission has provided an 
opportunity for a hearing to interested persons and departments and 
agencies of the United States Government. The Commission's exemption 
procedures in 46 CFR part 502 include a similar hearing requirement and 
provide that the Commission will publish notice of the proposed 
statutory exemption in the Federal Register and will solicit comments. 
46 CFR 502.92. Thus, although the Shipping Act only requires notice and 
opportunity for a hearing for exemptions from the statutory 
requirements in the Act, the Commission requires notice and opportunity 
for a hearing for exemptions from regulatory requirements by 
incorporating section 40103 and the part 502 exemption procedures in 46 
CFR 530.13(b).
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    \1\ Section 530.13(b) includes an out-of-date cross-reference to 
46 CFR 502.67, which formerly contained the Commission's exemption 
procedures. Those procedures are currently located at 46 CFR 502.92.
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    The current COVID-19 pandemic and its effect on the international 
supply chain and commercial operations has demonstrated a need for 
Commission flexibility to provide immediate regulatory relief in 
appropriate circumstances. This is particularly true in the case of 
service contracts given the challenges that the current situation 
presents to contract negotiation, formation, and filing by the carriers 
and their customers. To that end, the

[[Page 23228]]

Commission is revising its exemption procedures for part 530 to allow 
for exemptions from the regulatory requirements in that part to be 
granted without notice and opportunity for a hearing. Specifically, the 
Commission is revising Sec.  530.13(b) to state that exemptions from 
the requirements in part 530 are governed by 46 U.S.C. 40103(a), which 
provides the substantive criteria for granting exemptions, 46 CFR 
502.92, which lays out the procedure for requesting exemptions and how 
exemptions are processed, and 46 CFR 502.10, which permits the 
Commission to waive the rules in part 502 in particular cases to 
prevent undue hardship, manifest injustice, or if the expeditious 
conduct of business so requires.
    The Commission emphasizes that these changes only affect the 
procedures for granting exemptions from the regulatory requirements in 
part 530. The final rule does not affect the procedures for exemptions 
from the statutory requirements of the Shipping Act, which will 
continue to be subject to notice and an opportunity for a hearing 
before issuance. See 46 U.S.C. 40103(b). In addition, these changes 
will not affect the substantive criteria for granting exemptions from 
the regulatory requirements in part 530. Such exemptions will continue 
to be granted when the Commission finds that the exemption will not 
result in substantial reduction in competition or be detrimental to 
commerce. And the Commission will, as a general matter, continue to 
provide notice and an opportunity for comment on proposed exemptions 
before issuing an exemption from requirements in part 530. Under the 
final rule, however, the Commission will have the ability to waive 
these procedural requirements under Sec.  502.10 in appropriate 
circumstances.

Rulemaking Analyses and Notices

Final Rule Justification and Effective Date

    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 final rule relates to the Commission's 
organization, procedures, and practices; it revises the Commission's 
procedures for exempting regulated entities from the regulatory 
requirements in 46 CFR part 530. The Commission has also determined 
given the current challenges faced by the shipping industry due to the 
COVID-19 pandemic, the ability for regulated entities to seek prompt 
regulatory relief from the Commission is needed in the immediate 
future, notice and comment is impracticable and contrary to the public 
interest. See 5 U.S.C. 553(b)(B).
    The Administrative Procedure Act also generally requires a minimum 
of 30 days before a final rule can go into effect, but excepts from 
this requirement: (1) Substantive rules which grant or recognize an 
exemption or relieve a restriction; (2) interpretive rules and 
statements of policy; and (3) when an agency finds good cause for a 
shorter period of time and includes those findings with the rule. 5 
U.S.C. 553(d). For the same reasons as discussed above, good cause 
exists for making this final rule effective upon publication in the 
Federal Register, given the immediate need for regulated entities to 
have the ability to seek prompt regulatory relief from the Commission.

Congressional Review Act

    The 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 final rule relates to agency organization, procedures, and 
practices. Specifically, the final rule revises the Commission's 
exemption procedures under part 530 to give the Commission flexibility 
to forgo notice and opportunity for hearing in certain circumstances 
before granting an exemption from the service contract regulatory 
requirements. Although the final rule will affect interested parties' 
ability to comment on certain proposed regulatory exemptions before 
they are granted, the Commission does not believe the rule 
substantially affects their rights. Notice and comment will continue to 
be generally required before an exemption is granted. Only when 
necessary to prevent undue hardship, manifest injustice, or if the 
expeditious conduct of business so requires, will the Commission waive 
these requirements. Based on the foregoing, the 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 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 final rule revises Commission 
regulations governing the exemption procedures for the service contract 
regulatory requirements in part 530. This rulemaking thus falls within 
the categorical exclusions for procedural rules pursuant to 46 CFR part 
502 (Sec.  504.4(a)(4)), and related to the receipt service contracts 
(Sec.  504.4(a)(5)). 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 final rule does not 
contain any collections of information as defined by 44 U.S.C. 3502(3) 
and 5 CFR 1320.3(c).

Executive Order 12988 (Civil Justice Reform)

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

[[Page 23229]]

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 https://www.reginfo.gov/public/do/eAgendaMain.

List of Subjects in 46 CFR Part 530

    Freight, Maritime carriers, Report and recordkeeping requirements.

    For the reasons set forth above, the Federal Maritime Commission is 
amending 46 CFR part 530 as follows:

PART 530--SERVICE CONTRACTS

0
1. The authority citation for part 530 continues to read as follows:

    Authority:  5 U.S.C. 553; 46 U.S.C. 305, 40301-40306, 40501-
40503, 41307.


0
2. Amend Sec.  530.13 by revising paragraph (b) introductory text to 
read as follows:


Sec.  530.13   Exceptions and exemptions.

* * * * *
    (b) Commission exemptions. Exemptions from the requirements of this 
part are governed by 46 U.S.C. 40103(a) and Sec. Sec.  502.10 and 
502.92 of this chapter. The following commodities and/or services are 
exempt from the requirements of this part:
* * * * *

    By the Commission.
Rachel Dickon,
Secretary.
[FR Doc. 2020-09003 Filed 4-24-20; 8:45 am]
 BILLING CODE 6730-02-P