Protection of Stratospheric Ozone: Reconsideration of Petition Criteria and Incorporation of Montreal Protocol Decisions

SUMMARY: With this action, EPA is proposing revisions to the

accelerated phaseout regulation that governs the production, import and

export of substances that deplete the ozone layer under the authority

of sections 602, 604, 605, 606, and 614 of the Clean Air Act Amendments

of 1990 (CAA). Today's proposed amendments are made to reflect changes

in U.S. obligations under the Montreal Protocol on Substances that

Deplete the Ozone Layer (Protocol) due to recent decisions by signatory

countries to this international agreement. Additionally, in response to

a petition submitted to EPA, the Agency is proposing to remove the

requirement in the petition process for imports of used class I

controlled substances that a person must certify knowledge of tax

liability. Other proposed amendments are made to ease the burden on

affected companies while continuing to ensure compliance with Title VI

of the CAA and meet U.S. obligations under the Protocol.

Elsewhere in this issue of the Federal Register, EPA is amending

the accelerated phaseout regulation as a direct final rule without

prior proposal because the Agency views many of these distinct

revisions as noncontroversial and anticipates no relevant adverse

comments. A detailed list of the many distinct revisions is set forth

in the direct final rule. If no relevant adverse comments are received

on the direct final rule, no further activity is contemplated in

relation to this proposed rule. The EPA believes that many of the

distinct revisions are noncontroversial because they address various

implementation issues without major changes in policy.

DATES: Written comments must be received by September 3, 1998, unless a

public hearing is requested. Comments must then be received on or

before 30 days following the public hearing. Any party requesting a

public hearing must notify the contact person listed below by 5 p.m.

Eastern Standard Time on August 14, 1998. If a hearing is requested it

will be held September 1, 1998, and EPA will publish a document in the

Federal Register announcing the hearing information and the extended

comment period.

ADDRESSES: Comments on the companion to the direct final rule should be

submitted in duplicate (two copies) to: Air Docket No. A-92-13, U.S.

Environmental Protection Agency, 401 M Street, SW, Room M-1500,

Washington, DC, 20460. Comments must be identified with Docket No. A-

92-13 . Inquiries regarding a public hearing should be directed to the

Stratospheric Ozone Protection Hotline at 1-800-269-1996.

Materials relevant to this proposed rulemaking are contained in

Docket No. A-92-13. The Docket is located in room M-1500, First Floor,

Waterside Mall at the address above. The materials may be inspected

from 8 a.m. until 4 p.m. Monday through Friday. A reasonable fee may be

charged by EPA for copying docket materials.

FOR FURTHER INFORMATION CONTACT: Tom Land, U.S. Environmental

Protection Agency, Stratospheric Protection Division, Office of

Atmospheric Programs, 6205J, 401 M Street, SW., Washington, DC, 20460,

(202) 564-9185.

SUPPLEMENTARY INFORMATION: The EPA believes that many of the distinct

revisions in the direct final rule published in today's Federal

Register are noncontroversial; however, should the Agency receive

relevant adverse comment on the companion direct final rule, it will

publish a timely withdrawal informing the public that the rule will not

take effect. All relevant adverse comments received will be addressed

in a subsequent final rule based on this proposed rule. The EPA will

not institute a second comment period on this document. For additional

information, see the direct final rule published in the Final Rules

section of this Federal Register.

For ease of reference to the distinct revisions, the table of

contents for the direct final rule published in the Final Rules section

of this Federal Register is as follows:

Table of Contents

I. Background

II. Revisions to the Stratospheric Ozone Protection Program

A. Amendments to Sec. 82.3--Definitions

1. Adding a Definition for the Term ``Confer'' that Pertains to

Essential-Use Allowances

2. Adding Destruction Technologies to the List of Those Approved

in the Definition of Destruction

3. Simplifying the Definition of ``Importer''

4. Adding a Definition for the Phrase ``Source Facility'' that

Pertains to the Petition Process for Imports of Used Controlled

Substances

5. Clarifying the Definition of Transhipment

B. Amendments to Sec. 82.4--Prohibitions

1. Licensing System for Imports and Exports of Listed Controlled

Substances--both Newly Manufactured and Previously Used

2. Control of Exported Products that Rely on Class I Controlled

Substances for their Continuing Functioning to Article 5 Parties

3. Prohibit Imports and Exports of HBFCs from or to Non-Parties

to the Protocol

4. Application Process for Exemptions to the HCFC Phaseout for

Specific National Security Uses.

5. Simplify Procedure for Apportioning Essential-Use Allowances

and Essential-Use Exemptions through a Notice

6. Prohibit Import of Class I Controlled Substances for

Essential-Uses Except by Companies Allocated Essential-Use

Allowances

C. Amendments to Sec. 82.9--Availability of Production

Allowances in Addition to Baseline Production Allowances

1. Clarification of Increases or Decreases of Article 5

Allowances due to International Transfers

D. Amendments to Sec. 82.12--Transfers

1. Increases or Decreases of Essential-Use Allowances due to

Emergency International Transfers

E. Amendments to Sec. 82.13--Recordkeeping and Reporting

Requirements

1. Removal of Producer Requirement to Report the Quantity of

Used Material Received that Contains Recycled or Reclaimed

Controlled Substances

2. Add to the Producer Recordkeeping and Reporting Requirements

the Need to Maintain and Submit a Certification that a Quantity of

Class I Controlled Substance will be used as a Process Agent.

3. Clarify the Need for Letters that Confer Essential-Use

Allowances and Destruction and Transformation Credits to Producers

and that these Letters be Submitted with Producer's Quarterly

Reports

4. Changes to the Petition Process for Importing Used Class I

Controlled Substances

a. Clarification that a Petition to Import Used Class I

Controlled Substances is Submitted for One Individual Shipment

b. Changing the de minimis Quantity for an Individual Shipment

for which a Person is Required to Submit a Petition to Import Used

Class I Controlled Substances

c. Revised and Expanded Information Requirements for a Petition

to Import Used Class I Controlled Substances

d. Removal of the Information Requirement regarding the Tax for

People Petitioning to Import Used Class I Controlled Substances

e. Clarification of the Timing for EPA Review of a Petition f.

Clarification of Reasons for Disallowing Petitions to

[[Page 41653]]

Import Used Class I Controlled Substances

g. Requirement that the Petition and the Non-Objection Letter

from EPA for the Import of Used Class I Controlled Substances

Accompany the Shipment through U.S. Customs Clearance

5. Requirement that Importers of Controlled Substances and Used

Controlled Substances use the Harmonized Commodity Codes in this

Regulation in completing Customs Entry Documents

6. Modify the Requirement for a Sales Contract that Certifies

Exported Controlled Substances will be Transformed or Destroyed

7. Applying the Recordkeeping and Reporting Requirements to

Material obtained from Importers as well as Producers for a Person

that Transforms or Destroys Class I Controlled Substances

8. Changes to the Recordkeeping and Reporting Requirements for

Entities Allocated Essential-Use Allowances

9. Changes to the Reporting Requirement for Distributors of

Laboratory Supplies under the Global Laboratory Essential Use

Exemption

III. Miscellaneous Additional Changes

Summary of Supporting Analysis

A. Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub.

L. 104-4, establishes requirements for Federal agencies to assess the

effects of their regulatory actions on State, local and tribal

governments and the private sector. Under section 202 of the UMRA, EPA

generally must prepare a written statement, including a cost-benefit

analysis, for proposed and final rules with ``Federal mandates'' that

may result in expenditures by State, local and tribal governments, in

the aggregate, or by the private sector, of $100 million or more in any

one year. If a written statement is required under section 202, section

205 of the UMRA generally requires EPA to identify and consider a

reasonable number of regulatory alternatives and adopt the least

costly, most cost-effective or least burdensome alternative that

achieves the objectives of the rule, unless the Agency explains why

this alternative is not selected or the selection of this alternative

is inconsistent with law.

Section 203 of the UMRA requires the Agency to establish a plan for

obtaining input from and informing, educating, and advising any small

governments that may be significantly or uniquely affected by the rule.

Section 204 of the UMRA requires the Agency to develop a process to

allow elected state, local, and tribal government officials to provide

input in the development of any proposal containing a significant

Federal intergovernmental mandate.

EPA has determined that this rule does not contain a Federal

mandate that may result in expenditures of $100 million or more by

State, local and tribal governments, in the aggregate, or by the

private sector, in any one year. Most of the provisions in today's rule

fulfill the obligations of the United States under the international

treaty, The Montreal Protocol on Substances that Deplete the Ozone

Layer, as well as those requirements specifically set forth by Congress

in sections 604, 606 and 614 of the Clean Air Act Amendments of 1990.

The remainder merely serve to clarify existing regulatory text and

therefore impose no new additional enforceable duties on governmental

entities or the private sector. The majority of the amendments do not

create significant additional costs for either the public or the

private sector because they address various implementation issues

without major changes in policy. Viewed as a whole, today's amendments

do not create a Federal mandate resulting in costs of $100 million or

more in any one year for State, local and tribal governments, in the

aggregate, or for the private sector. Thus, today's rule is not subject

to the requirements of sections 202 and 205 of the UMRA. EPA has also

determined that this rule contains no regulatory requirements that

might significantly or uniquely affect small governments; therefore,

EPA is not required to develop a plan with regard to small governments

under section 203. Finally, because this proposal does not contain a

significant intergovernmental mandate, the Agency is not required to

develop a process to obtain input from elected state, local, and tribal

officials under section 204.

B. Regulatory Flexibility

The Regulatory Flexibility Act (RFA) generally requires an agency

to conduct a regulatory flexibility analysis of any rule subject to

notice and comment rulemaking requirements unless the agency certifies

that the rule will not have a significant economic impact on a

substantial number of small entities. Small entities include small

businesses, small not-for-profit enterprises, and small governmental

jurisdictions.

The Agency performed an initial screening analysis and determined

that this regulation does not have a significant economic impact on a

substantial number of small entities. EPA characterized the regulated

community by identifying the SIC codes of the companies affected by

this rule. The Agency determined that the members of the regulated

community affected by today's rule are generally not small businesses.

Small governments and small not-for-profit organizations are not

subject to the provisions of today's rule. The provisions in the

accelerated phaseout rule and today's action regulate large,

multinational corporations that either produce, import, export,

transform or destroy ozone-depleting chemicals controlled by this rule.

To the extent that today's actions affect entities other than large,

multinational corporations, there are few that are small entities and

the economic impact is negligible. Thus, today's rule will not have a

significant economic impact on a substantial number of small entities.

The rule includes changes to recordkeeping or reporting requirements.

Those changes included in today's rule that increase reporting burden

only apply to large companies (pharmaceutical companies holding

essential-use allowances). In general, for small entities, the changes

in today's action reduce reporting and recordkeeping.

EPA concluded that this proposed rule would not have a significant

impact on a substantial number of small entities, therefore, I hereby

certify that this action will not have a significant economic impact on

a substantial number of small entities. This rule, therefore, does not

require a regulatory flexibility analysis.

C. Executive Order 12866

Under Executive Order 12866 (58 FR 51735, October 4, 1993), the

Agency must determine whether this regulatory action is ``significant''

and therefore subject to OMB review and the requirements of the

Executive Order. The Order defines a ``significant'' regulatory action

as one that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more,

or adversely affect in a material way the economy, a sector of the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities;

(2) Create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; or

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

It has been determined by EPA and OMB that this rule is not a

``significant regulatory action'' within the meaning of the Executive

Order.

[[Page 41654]]

D. Applicability of E.O. 13045--Children's Health Protection

This proposed rule is not subject to E.O. 13045, entitled

``Protection of Children from Environmental Health Risks and Safety

Risks'' (62 FR 19885, April 23, 1997), because it does not involve

decisions on environmental health risks or safety risks that may

disproportionately affect children.

E. Paperwork Reduction Act

The revised information collection requirements in these amendments

have been submitted for approval to OMB under the Paperwork Reduction

Act, 44 U.S.C. 3501 et seq. An Information Collection Request (ICR)

document has been prepared by EPA (ICR No. 1432.17) and a copy may be

obtained from Sandy Farmer by mail at OPPE Regulatory Information

Division; U.S. Environmental Protection Agency (2137); 401 M St., SW;

Washington, DC 20460, by email at [email protected], or by

calling (202) 260-2740. A copy may also be downloaded off the internet

at http://www.epa.gov/icr. The additional information requirements in

these amendments are not effective until OMB approves them.

The information collection under this rule is authorized under

sections 603(b) and 114 of the Clean Air Act Amendments of 1990 (CAA).

This information collection is conducted to meet U.S. obligations under

Article 7, Reporting Requirements, of the Montreal Protocol on

Substances that Deplete the Ozone Layer (Protocol); and to carry out

the requirements of Title VI of the CAA, including sections 603 and

614.

The reporting requirements included in the amendments to the

current rule are designed to:

(1) Ensure compliance with the restrictions on production, import

and export of controlled ozone-depleting substances after the phaseout

of class I substances (except methyl bromide) after January 1, 1996;

(2) Allow exempted production and import for certain essential uses

and the consequent tracking of that production and import;

(3) Address industry and Federal concerns regarding the illegal

import of mislabelled used controlled substances that are claimed to be

undercutting U.S. markets;

(4) Respond to industry comments on the functioning of the program

to streamline reporting and eliminate administrative inefficiencies;

(5) Satisfy U.S. obligations under the international treaty, the

Montreal Protocol on Substances that Deplete the Ozone Layer

(Protocol), to report data under Article 7;

(6) Fulfill statutory obligations under Section 603(b) of Title VI

of the Clean Air Act Amendments of 1990 (CAA) for reporting and

monitoring;

(7) Provide information to report to Congress on the production,

use and consumption of class I and class II controlled substances as

statutorily required in Section 603(d) of Title VI of the CAA.

EPA informs respondents that they may assert claims of business

confidentiality for any of the information they submit. Information

claimed confidential will be treated in accordance with the procedures

for handling information claimed as confidential under 40 CFR Part 2,

Subpart B, and will be disclosed only if EPA determines that the

information is not entitled to confidential treatment. If no claim of

confidentiality is asserted when the information is received by EPA, it

may be made available to the public without further notice to the

respondents (40 CFR 2.203).

The information collection requirements for this action have an

estimated reporting burden averaging 23.3 hours per response. This

estimate includes time for reviewing instructions, searching existing

data sources, gathering and maintaining the data needed and completing

the collection of information.

The estimate includes the time needed to comply with EPA's

reporting requirements, as well as that used for the completion of the

reports under the amended regulations.

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Number of Responses/ Total Hours per

Collection activity respondents respondent responses response Total hours

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

Producer's Report.............................. 8 4 32 16 512

Importer's Report.............................. 12 4 48 16 768

Notification of Trade.......................... 2 1 2 2 4

Export Report.................................. 10 1 10 80 800

Lab Certification.............................. 1000 1 1000 1 1000

Class II Report................................ 14 4 56 16 896

Transformation & Destruction................... 15 1 15 80 1200

Essential Use Allowance Holders................ 12 4 48 32 1536

Lab Suppliers.................................. 4 4 16 24 384

Lab Suppliers--Reference Standards............. 10 1 10 16 160

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Total burden hours....................... ........... ........... ........... ........... 7260

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Burden means the total time, effort, or financial resources

expended by persons to generate, maintain, retain, or disclose or

provide information to or for a Federal agency. This includes the time

needed to review instructions; develop, acquire, install, and utilize

technology and systems for the purposes of collecting, validating, and

verifying information, processing and maintaining information, and

disclosing and providing information; adjust the existing ways to

comply with any previously applicable instructions and requirements;

train personnel to be able to respond to a collection of information;

search data sources; complete and review the collection of information;

and transmit or otherwise disclose the information.

An Agency may not conduct or sponsor, and a person is not required

to respond to, a collection of information unless it displays a

currently valid OMB control number. The OMB control numbers for EPA's

regulations are listed in 40 CFR Part 9 and 48 CFR Chapter 15.

Send comments on the Agency's need for this information, the

accuracy of the provided burden estimates, and any suggested methods

for minimizing respondent burden, including through the use of

automated collection techniques to the Director, OPPE Regulatory

Information Division; U.S. Environmental Protection Agency (2137); 401

M St., SW; Washington, DC 20460; and to the Office of Information and

Regulatory Affairs, Office of Management and Budget, 725 17th St., NW,

Washington, DC 20503, marked

[[Page 41655]]

``Attention: Desk Officer for EPA.'' Include the ICR number in any

correspondence.

F. Executive Order 12875

Today's action does not impose any unfunded mandate upon any State,

local, or tribal government; therefore, Executive Order 12875 does not

apply to this rulemaking.

List of Subjects in 40 CFR Part 82

Environmental protection, Administrative practice and procedure,

Air pollution control, Chemicals, Chlorofluorocarbons, Exports,

Hydrochlorofluorocarbons, Imports, Ozone layer, Reporting and

recordkeeping requirements.

Dated: July 17, 1998.

Carol M. Browner,

Administrator.

[FR Doc. 98-20151 Filed 8-3-98; 8:45 am]

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