[Federal Register Volume 77, Number 39 (Tuesday, February 28, 2012)]
[Proposed Rules]
[Pages 11995-11997]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-4749]



 46 CFR Parts 501 and 540

[Docket No. 11-16]
RIN 3072-AC45

Passenger Vessel Operator Financial Responsibility Requirements 
for Non-Performance of Transportation

AGENCY: Federal Maritime Commission.

ACTION: Proposed rule: Request for additional comments and information.


SUMMARY: The Federal Maritime Commission requests additional comments 
and information in order to assist the Commission's determination 
whether passenger vessel operators may be deemed ``small entities'' 
under the Regulatory Flexibility Act (as amended by the Small Business 
Regulatory Enforcement Fairness Act).

DATES: Submit comments on or before March 30, 2012.

ADDRESSES: Address all comments concerning this proposed rule to: Karen 
V. Gregory, Secretary, Federal Maritime Commission, 800 North Capitol 
Street NW., Washington, DC 20573-0001, Phone: (202) 523-5725, Email: 
[email protected].

FOR FURTHER INFORMATION CONTACT: Vern W. Hill, Director, Bureau of 
Certification and Licensing, 800 North Capitol Street NW., Washington, 
DC 20573-0001, Phone: (202) 523-5787, Email: [email protected].


Submit Comments

    Non-confidential Comments and Information. For non-confidential 
comments submit an original and five (5) paper copies, and if possible, 
send a PDF of the document by email to [email protected]. Include in 
the subject line: Docket No. 11-16 and [Company/Individual Name].
    Confidential Comments and Information. Confidential filings must be 
submitted in the traditional manner on paper, rather than by email. 
Comments and information that are submitted for confidential treatment 
must be submitted in hard copy by U.S. mail or courier. Confidential 
filings must be accompanied by a transmittal letter that identifies the 
filing as ``confidential'' and describes the nature and extent of the 
confidential treatment requested. Responses to this Request that 
contain confidential information must consist of (1) the complete 
filing and (2) be marked by the filer as ``Confidential-Restricted,'' 
with the confidential material clearly marked on each page. When a 
confidential filing is submitted, an original and one additional copy 
of the public version of the filing must be submitted. The public 
version of the filing should exclude confidential materials, and be 
clearly marked on each affected page, ``confidential materials 
excluded.'' The Commission will provide confidential treatment to the 
extent allowed by law for those submissions, or parts of submissions, 
for which the parties request confidentiality.
    Questions regarding filing or treatment of confidential responses 
to this NPRM should be directed to the Commission's Secretary, Karen V. 
Gregory, at the telephone number or email provided above.


    On September 13, 2011, the Commission issued its Notice of Proposed 
Rulemaking (NPRM) to update its financial responsibility requirements 
for nonperformance of passenger vessel service by passenger vessel 
operators that are subject to section 3 of Public Law 89-777, 46 U.S.C. 
44101-44106. The NPRM was published in the Federal Register on 
September 20, 2011. 76 FR 58227-58236.
    In the NPRM, the Commission relied upon the rebuttable presumption 
established in 2003\1\ that PVOs are generally large companies with 
more than 500 employees and noted that there are no PVO small entities 
that would be affected by the proposed rule. NPRM, p. 12. In addition, 
the Commission also provided the factual basis under the Regulatory 
Flexibility Act (RFA),\2\ as amended by the Small

[[Page 11996]]

Business Regulatory Enforcement Fairness Act (SBREFA),\3\ for the 
Chairman's certification that the rule will not have a significant 
economic impact on a substantial number of small entities. It was noted 
that the proposed rule could result in significant reductions in the 
cost of financial responsibility coverage because of the use of 
alternative coverage options. However, the public was requested to 
comment on the certification and its underlying assumptions.\4\

    \1\ See, FMC Policy and Procedures Regarding Proper 
Consideration of Small Entities in Rulemakings (February 7, 2003). 
(Commission SBREFA Policy). See, http://www.fmc.gov/assets/1/Page/SBREFA_Guidelines_2003.pdf.
    \2\ Regulatory Flexibility Act, Pub. L. 96-354, 94 Stat. 1164 
(codified at 5 U.S.C. 601 et seq.).
    \3\ Small Business Regulatory Enforcement Fairness Act of 1996, 
Pub. L. 104-121, 110 Stat. 857.
    \4\ The Commission SBREFA Policy also encourages small PVOs to 
``submit a request for such treatment * * *, along with payroll * * 
* evidence * * *, to substantiate its claim and rebut the 
presumption.'' SBREFA Policy, p. 4.

    American Cruise Lines, Inc. (ACL) requests in its comments that the 
Commission treat it as a small entity under the RFA and SBREFA. ACL 
informed the Commission that it has less than 500 employees, which is 
the maximum number a PVO can employ and be considered a small entity 
under SBA's current size standards.\5\ ACL Comments, pp. 2-3. The 
Passenger Vessel Association (PVA) similarly asserts that four of its 
members would qualify as small entities under RFA and SBREFA and that a 
``good faith analysis'' under those statutes should be made. PVA 
Comments, p. 3. In view of these comments, the Commission seeks 
additional information relevant to the Commission's analysis whether 
there will be significant economic impacts on a substantial number of 
small entities.

    \5\ See http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf.

    In its SBREFA Policy, the Commission adopted the small business 
size standards established by the Small Business Administration that 
are matched to industry classifications in the North American Industry 
Classification System (NAICS).\6\ The Commission specifically 
identified industry code and title: 483112--Deep Sea Passenger 
Transportation. However, two additional code classifications in the 
NAICS may apply to passenger vessel operators: 483114--Coastal and 
Great Lakes Passenger Transportation; and, 483212 Inland Water 
Passenger Transportation. For each of these three code classifications, 
the same size standard applies. In other words, a PVO may have no more 
than 500 employees in order to be considered a small entity.

    \6\ SBREFA Policy, at p. 3.

    In order to determine the number and extent to which small entity 
PVOs may be affected by the proposed rule, the Commission invites 
response from all PVOs as to the number of employees employed by their 
companies.\7\ The employee data sought includes full time and temporary 
employees, and the number of employees of each PVO's foreign and 
domestic affiliates.

    \7\ SBA regulations establish principles relative to the 
calculation of a business' total number of employees. For example 
``the average number of employees of the concern is used * * * based 
upon the numbers of employees for each of the pay periods for the 
preceding completed 12 calendar months.'' 13 CFR 121.106(b).

    In addition, the Commission's threshold analysis under RFA and 
SBREFA also involves estimating:
     The economic impacts upon those entities,
     Whether those impacts are significant (including whether 
such entities would be placed at a competitive disadvantage relative to 
larger entities), and
     Whether such effects will fall upon a substantial number 
of small entities.
    In pursuing this analysis, the Commission needs information from 
large and small PVOs. The questions set forth below seek information 
related to: each PVO's estimated cost of compliance with the proposed 
rule; the company's total revenues, expenses and earnings; the average 
revenue per passenger; the number of passengers embarked at U.S. and 
foreign ports; and identification of direct competitors in the United 
States cruise markets in which the PVO is currently operating.
    In view of the foregoing, the Commission requests written comments 
and responses to the following questions by interested parties, 
including those that previously filed comments in response to the 
proposed rulemaking.\8\

    \8\ Comments were received from Congressman Andy Harris, M.D. 
(Maryland), The Surety & Fidelity Association of America, Lindblad 
Expeditions, Inc., Royal Caribbean Cruises Ltd., National 
Association of Surety Bond Producers, Cruise Lines International 
Association, Inc., American Cruise Lines, Inc., Passenger Vessel 
Association, Carnival Corporation & plc.


    1. Please detail your estimated cost of compliance with the 
proposed rule's requirements pertaining to financial responsibility for 
nonperformance of passenger vessel transportation (i.e., premiums and 
fees by sureties; collateral required by credit card issuers; other 
    (a) Based on current operations and costs for the past year (2011).
    (b) Your estimated cost of compliance if alternative forms of 
protections as contained in the proposed rule are available.
    2. Will the nonperformance requirements in the proposed rule change 
your type of coverage? If so, explain how.
    3. How will the proposed changes to the requirements affect your 
continuing operations?
    4. Estimated number of your company's staff hours required to 
comply with proposed changes to the application form (Form 131).
    5. Estimated number of your company's staff hours required to 
comply with proposed changes to Unearned Passenger Revenue (UPR) 
    6. What was your total revenue in 2011? These figures should 
reflect revenues obtained from all sources (not just from cruises under 
the Commission's program).
    7. What were your total expenses in 2011? These figures should 
reflect expenditures incurred by all activities (not just by cruises 
under the Commission's program).
    8. What were your earnings after taxes in 2011? These figures 
should reflect earnings after taxes from all operations (not just 
operations conducted under the Commission's program).
    9. Please provide the following information regarding the number of 
employees your company employed in the most recent 12 calendar months 
(include any domestic and/or foreign affiliates in calculating number 
of employees):
    (a) Full-time, permanent employees (head-count).
    (b) Part-time, permanent employees (head-count and full-time 
    (c) Full-time, seasonal or temporary employees (head-count).
    (d) Part-time, seasonal or temporary employees (head-count and 
full-time equivalents).
    (e) Staff obtained from temporary employment agencies (head-count 
and full-time equivalents). Do not include these totals in (a) through 
(d) above.
    (f) Staff obtained from professional employee organizations (head-
count and full-time equivalents). Do not include these totals in (a) 
through (d) above.
    10. Which passenger vessel operators (brand(s)) do you consider 
your closest competitor(s) in U.S.-based markets?
    11. What was the average revenue generated by each passenger who 
embarked on your U.S.-based cruises in 2011?
    12. How many passengers did you embark in 2011 at:
    (a) U.S. ports.
    (b) Non-U.S. ports.
    13. Please provide any other comments or information that you 
believe would assist the Commission in analyzing the economic or 
competitive impact of the proposed rule in this proceeding.

[[Page 11997]]

    By the Commission.
Karen V. Gregory,
[FR Doc. 2012-4749 Filed 2-27-12; 8:45 am]