Policy on Giant Panda Permits

DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

Policy on Giant Panda Permits

AGENCY: Fish and Wildlife Service, Interior.

ACTION: Notice of policy on the issuance of permits for giant panda

imports.

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

SUMMARY: The U.S. Fish and Wildlife Service (Service) announces a

policy on the issuance of permits for the import of live giant pandas

to clarify what information the Service considers in making the permit

findings under the Convention on International Trade in Endangered

Species and the U.S. Endangered Species Act and to assist persons in

filing a complete application. The policy is intended to complement,

and not replace, the current permit procedures and issuance criteria in

the regulations. The goal of this policy is that all imports directly

benefit panda conservation through a coordinated effort that supports

China's National Plan, National Survey, or Captive Breeding Plan. Based

on current information on the status of pandas and their habitat, the

policy emphasizes research and captive-breeding activities needed to

ensure the captive population becomes self-sustaining and to recover

panda populations in the wild. Thus, all monies used in a loan

agreement or raised as a result of a panda import should fund giant

panda conservation efforts, with a significant portion being used for

priority in-situ conservation projects in China. Display of a panda

would be allowed as an ancillary component that would not interfere

with the research or captive-breeding activities. It is unlikely that

the Service would be able to make the necessary findings to issue a

permit to import animals removed from the wild after December 31, 1996.

The policy also addresses the transfer of live pandas within the United

States and the import or export of tissue samples. The policy

supersedes previous policy. The suspension of the review and processing

of permit applications to import live giant pandas is now lifted.

DATES: This policy is effective August 27, 1998 and will remain in

effect until modified or terminated.

ADDRESSES: Questions regarding this policy should be addressed to the

Chief, Office of Management Authority, U.S. Fish and Wildlife Service,

1849 C Street, N.W., Mailstop ARLSQ-700, Washington, D.C. 20240.

FOR FURTHER INFORMATION CONTACT: Teiko Saito, Chief, Office of

Management Authority, telephone (703) 358-2093 or fax (703)-358-2280,

(see ADDRESSES section).

SUPPLEMENTARY INFORMATION:

Acronyms Used in This Notice

AZA American Zoo and Aquarium Association

CBSG Conservation Breeding Specialist Group (a program of the IUCN)

CITES Convention on International Trade in Endangered Species of Wild

Fauna and Flora

ESA U.S. Endangered Species Act

IUCN World Conservation Union

MOC Ministry of Construction (China)

MOF Ministry of Forestry (China)

SSP Species Survival Program (a program of the AZA)

WWF World Wildlife Fund for Nature

Background

The survival and ultimate recovery of the population of the giant

panda (Ailuropoda melanoleuca) in its ecosystem is the strong desire of

the United States, the People's Republic of China (China), and the

international conservation community. As such, the panda is subject to

strict protection by its listing as an endangered species under the ESA

and its inclusion in Appendix I of CITES. The Service is responsible

for regulating pandas by deciding whether to grant permits to allow

their movement into and within the United States. In making these

decisions the Service, under the ESA, must determine whether the

proposed activities are not likely to jeopardize the continued

existence of the giant panda and would be for scientific research that

promotes the conservation of the species or enhancement of propagation

or survival, and under CITES, would be for purposes that are not

detrimental to the survival of the species and that are not primarily

commercial.

In the late 1980's, the proposals for temporary exhibition (short-

term) loans of giant pandas became an increasingly controversial issue.

During one period in 1988, the Service received reports that as many as

30 institutions may have been negotiating, or planning to negotiate,

with various entities in China to arrange panda loans, potentially

posing additional threats to the wild and captive populations of

pandas. As a result the Service, through the public review process,

published a policy on March 14, 1991 (56 FR 10809), for the issuance of

import permits for short-term exhibition loans. In 1992, after the

Service had issued a permit to the Columbus Zoo to import a pair of

giant pandas for a short-term exhibition loan, the CITES Secretariat

requested the Service to re-evaluate its policy on panda imports. The

Service published a notice in the Federal Register on June 29, 1992 (57

FR 28825), requesting public comment on the existing policy.

Before re-evaluation of the existing policy on short-term

exhibition loans was completed, the Service received an application

from the Zoological Society of San Diego (San Diego Zoo) to import a

pair of giant pandas for a long term, captive-breeding loan. On April

20, 1993, the AZA announced the development of a Giant Panda

Conservation Action Plan, which has since been formalized. The plan

outlines a captive-breeding program with support from 29 zoological

institutions in North America. In addition, in July 1993, China's MOC

(the agency generally responsible for China's ex-situ panda

conservation) published the second giant panda studbook, listing all

pandas then in captivity.

With the possibility of receiving an increasing number of import

permit applications for giant pandas for public exhibition, scientific

research, and/or captive-breeding purposes, the Service felt that a re-

examination of the long-range implications of panda imports was

necessary to ensure that such imports best serve the conservation needs

of the species. Thus, on December 20, 1993, the Service announced in a

news release the temporary suspension of the processing of any new

permit applications for the import of live giant pandas during a

reassessment of the policy. On May 4, 1994, the Service requested

public comments and announced a working public meeting to assist the

Service in formulating the draft revised policy (59 FR 23077). Public

meetings were held by the Service on May 26 and August 23, 1994. The

Service published the proposed policy for comment on March 30, 1995 (60

FR 16487). See that notice for a summary of the comments previously

[[Page 45840]]

received. The comment period on the new proposed policy was

subsequently extended for an additional 60 days in 1995 and reopened

for 150 days in 1997 to receive new information relevant to the

proposed policy (60 FR 33224, 62 FR 35518, and 62 FR 53017).

The following summarizes new information received during the open

comment periods of the proposed policy and discusses the rationale for

decisions reflected in the final policy.

Population Status

The proposed policy summarized the information on the status of

wild panda populations. The 1985-1988 survey remains the most current

information on the status of wild panda populations. The most commonly

accepted current estimate is that there are fewer than 1,000 pandas

left in the wild. A new Chinese national survey is to commence in 1998.

Status of Captive Breeding in China and the Need for Breeding

Efforts Outside of China

The proposed policy indicated that the captive-breeding program in

China is not currently self-sustaining. While this remains true,

advances have been made. In December 1996, the Chinese Association of

Zoological Gardens, MOC, in collaboration with the CBSG, held a Giant

Panda Captive Management Planning Workshop (MOC/CBSG Workshop) in

Chengdu, China. The objectives of the workshop were to assist local

captive population managers and policy makers to: (1) Formulate

priorities for a practical and scientific management program that fully

utilized all founders in captivity for the purpose of developing a

healthy, growing population of giant pandas in China; (2) formulate a

program that has linkage to the wild population, including the possible

reintroduction of individuals, if needed; (3) eliminate the need to

take more giant pandas from the wild; (4) develop a risk analysis and

simulation population model for the captive population that can be used

to guide and evaluate management and research activities; (5) identify

useful technology transfer and training, including evaluating all

adult, reproductive-age giant pandas in Chinese institutions; and (6)

identify and recruit potential international collaborators, when

needed, to enhance action. A final report was published that outlines

recommendations in order to meet these goals.

Reintroduction

The proposed policy noted that reintroduction is a long-term goal

that needs to be incorporated into coordinated international

conservation efforts. The Service still understands that reintroduction

is a stated long-term goal and sees value in discussing this issue as

long as it does not overshadow efforts to protect panda habitat.

In September 1997, WWF and China's MOF (the ministry generally

responsible for in-situ panda conservation) held a workshop on

reintroduction. Several action steps were recommended: (1) Implement a

national survey; (2) conduct further research aimed at improving birth

and neonatal survival rates in the captive population; (3) continue to

urge the government of China to completely implement the China National

Plan for Panda Conservation (National Plan); (4) promote long-term

national and international cooperation in raising funds; and (5)

initiate an experimental program with pandas in the captive population

designed to provide additional information on conducting successful

releases.

Giant Panda Conservation Plans

The proposed policy outlined the status of the National Plan and

AZA's Giant Panda Conservation Action Plan, and focused on funding of

in-situ projects from the National Plan to ensure conservation of

pandas in the wild. While the primary goal of the policy continues to

be conservation of pandas in the wild, the policy has been broadened to

include all of China's giant panda conservation efforts--the National

Plan, National Survey, and Captive Breeding Plan (as updated by the

MOC/CBSG Workshop report). The Service recognizes that although the

National Plan and National Survey are the primary plans identifying

high priority in-situ projects, the Captive Breeding Plan may have in-

situ projects (e.g., surveys or reintroduction efforts). The Service

also recognizes that although the Captive Breeding Plan is the primary

plan identifying high priority ex-situ conservation projects, the

National Plan may have ex-situ projects.

In September 1997, the Chinese hosted the International Symposium

on Environmental Protection and City Development of the 21st Century in

which panda conservation was a key topic. This symposium is a further

example of the willingness of the Chinese to collaborate and cooperate

on an international scale to further the conservation of pandas.

Purposes

The purposes of the ESA are to provide a means by which the

ecosystems upon which endangered and threatened species depend may be

conserved, to provide a program for the conservation of such species,

and to take such steps as may be appropriate to achieve the purposes of

certain conservation treaties and conventions. The purpose of CITES is

to protect animals and plants to ensure that commercial demand does not

threaten their survival in the wild by regulating trade in listed

species. This policy is derived from these purposes. The proposed

policy required that any import should be part of a coordinated

international panda effort. While this should be a long term goal, it

may not be possible to have all institutions worldwide holding pandas

to be part of an international panda conservation effort. Therefore,

the final policy clarifies that any U.S. institution wishing to import

pandas should participate in a coordinated international conservation

effort as much as possible and coordinate efforts in the context of

China's National Plan, National Survey, or Captive Breeding Plan.

Wild-Taken Pandas

The proposed policy set out that no pandas removed from the wild

after December 31, 1986, be allowed to be imported because of the

potential threat of incentives for removal due to demand for captive

pandas. The Service re-evaluated this determination and based on new

information, changed the date to December 31, 1996. This new date

coincides with the date of the MOC/CBSG Workshop where it was

determined that no additional wild-caught pandas were needed to sustain

the captive population. Concerns over take from the wild have decreased

based on information from the giant panda studbook which shows only a

few pandas have been removed from the wild in the past several years

and on previous information from China on rescue guidelines. Changing

the date will allow imports of genetically important wild-caught pandas

that are already in captivity but have not bred. One aim of the AZA

Giant Panda SSP is to focus their expertise on investigating why these

pandas are not breeding. Known breeders would most likely remain in

China as part of the breeding program. See further discussion of this

topic in the Summary of Comments.

Age and Other Parameters of Animals Available for Importation

The proposed policy provided that no post-breeding age pandas

(i.e., 20 years and older) would be considered for

[[Page 45841]]

import because it was felt that the risks from transport were

unacceptable. In the final policy the Service will use age as a factor

in determining issuance of a permit as it relates to the proposed

purpose of import. However, no upper age limit is set since the Service

has no scientific information to show that it would be very risky to

ship older pandas, but infirm animals will not be allowed to be

imported if transport will compromise the health of the panda.

Length of Loans

In the proposed policy, the length of giant panda loans was to be

determined by the purpose(s) of the loan and the length of time

necessary to accomplish the goals of the import. This has not been

changed in the final policy. The Service believes that internationally

coordinated giant panda conservation efforts could incorporate various

types of import, exchange, or loan arrangements requiring varying

lengths of time.

Enhancement and Conservation Benefits of Specific Projects

The Service proposed that the majority of net profits (80 percent)

should be used to fund in-situ conservation projects in China's

National Plan. The Service continues to believe that in-situ

conservation is critical to the recovery of giant pandas in China, but

recognizes the need to ensure to the extent possible that the captive-

breeding program in China is self-sustaining. Additionally, funding of

captive breeding and research can potentially contribute toward

conservation of pandas in the wild, particularly now that China has a

scientifically based captive-breeding/research plan. Thus, the policy

now states that a significant portion of all funds associated with the

loan, not just net profits, should be used to fund in-situ conservation

projects, instead of designating a specific percentage. This retains

the appropriate emphasis on in-situ conservation, but allows more funds

to support ex-situ projects as primarily outlined in the Captive

Breeding Plan. The proposed policy also outlined a regime to identify

and track project implementation. This has been retained, but project

selection may now be expanded beyond the National Plan to include the

National Survey and Captive Breeding Plan.

The Service continues to emphasize the need to relate giant panda

imports to the conservation and enhancement of the species in the wild,

especially through funding of in-situ projects. Presumably, most of the

imports will be from China but funding associated with imports of

pandas from other countries will also need to be linked to in-situ

conservation projects, although more flexibility will be allowed for

these imports. It is expected that most imports would be for multiple

purposes and funds (loan money and/or net profits) would be generated.

The allocation of funds to panda conservation satisfies part of the

conservation and enhancement findings required by an import under the

ESA. If no funds are associated with the import or transfer of live

pandas, the proposed activities must significantly contribute to panda

conservation in the wild. On the other hand, if funds are involved,

then a significant portion of all funds, including net profits received

by an applicant during a loan period, regardless of the source of the

panda, should be used for conservation projects.

Scientific Research

The Service proposed that imports for scientific research must

contribute to the conservation of pandas in the wild and in captivity.

The final policy has added some flexibility in that the research can be

more focused on contributions for captive animals if the import is for

dual purposes (scientific research and enhancement of the propagation

and survival of the species under the ESA).

There needs to be continual coordinated efforts to set priorities

for panda research. China's National Plan provides the following

research priorities: (1) Habitat improvement; (2) captive breeding; (3)

ecology, population status, and monitoring; (4) rearing and nutrition;

(5) prevention of illness; and (6) reintroduction of captive pandas to

the wild. The ``Giant Panda Breeding Plan'' developed in China lists

the following areas that need basic research: (1) artificial

insemination biology and techniques; (2) breeding behavior; (3) disease

prevention; (4) reproductive physiology; (5) diet; (6) mating ability;

(7) reproductive longevity; and (8) fertility. These priorities for the

captive population are further clarified in the report from the MOC/

CBSG Workshop. Because of the precarious level of the panda population,

it is important that research findings are shared quickly and

methodologies are transferred to China for use in the field and in the

captive-breeding program.

The ESA regulations [50 CFR 17.22(a)(1)(vii)] provide that an

applicant must give a full statement of the reasons the applicant is

justified in obtaining a permit for scientific purposes, including

details of the activities. The final policy continues to outline that

the applicant must provide a research proposal that demonstrates that

the research is properly designed and can be accomplished with the

available expertise and resources. The Service will not categorize or

identify acceptable kinds of research, but will retain the option of

evaluating the validity and/or current need of the proposal based on

priorities included in China's National Plan, National Survey, or

Captive Breeding Plan, or any subsequent modification of these plans.

If the panda(s) would also be on exhibition, the applicant should have

a monitoring plan to ensure that the display does not interfere with

the research or bias the data. Thus, under the proposed policy the

applicant needed to have adequate facilities separate and apart from

the public exhibition areas in case it is found that exhibition

interfered with the research. This same guidance was included in the

Captive Breeding section. Through the comments, it was evident that the

wording was interpreted to mean applicants needed facilities totally

separated from the exhibit. The final policy clarifies that the intent

is for an applicant to have off-exhibit facilities of sufficient size

to house pandas on a long term basis, if necessary, to conduct research

or breeding, but not necessarily be physically separated.

Captive Breeding

The ESA regulations [50 CFR 17.22(a)(1)(viii)] provide that an

applicant demonstrate a willingness to participate in a cooperative

breeding program and maintain or contribute data to a studbook. The

current issuance criteria require the Service to find the proposed

activity will not directly or indirectly conflict with any known

program intended to enhance survival probabilities of the population.

Thus, the proposed policy emphasized that institutions that import

pandas for captive breeding should participate actively in a

coordinated international panda conservation effort and needed to

supplement the breeding program in China. The final policy continues to

require that imports for captive breeding supplement China's breeding

program but ties such participation to the MOC/CBSG Workshop report. In

addition, to assist in wild panda recovery and development of a self-

sustaining captive population, captive-breeding activities should have

a research component.

The continued decline of the wild population of giant pandas and

the increasing fragmentation of its habitat may make it increasingly

important to establish a self-sustaining captive

[[Page 45842]]

population. The current captive population represents about 10 percent

of the total panda population, captive and wild. As of December 1996,

there were 124 giant pandas in captivity in 38 institutions: 104

animals were in institutions in China and 20 pandas were in 9

institutions located outside of China. In China, five institutions had

73 animals and were responsible for nearly all the breeding success.

Seventeen institutions held single animals. The Chinese recognize that

these captive pandas need to be moved for better breeding opportunities

and to ensure that all mature individuals participate in breeding. Of

the 20 pandas currently held in 9 institutions outside China, 3

institutions hold only 1 panda. These data demonstrate the great need

to coordinate the movement of captive-held pandas internationally.

The captive-breeding program in China is not currently self-

sustaining. Between 1936 and 1988, 345 pandas held in captivity

produced 67 litters of 106 cubs, with only 32 surviving more than a

year. In recent years, improvement in management and joint efforts

within China enhanced breeding and survival rates and reduced the

infant mortality rate of the captive population. However, a review of

the International Studbook of the Giant Panda suggests that the current

number of founders contributing to the captive population is

inadequate. According to the studbook, the current captive population

is descended from 32 founders. However, recent research suggests that

fewer than 32 founders may exist because the paternity of some of the

captive-born pandas is uncertain. Ongoing research should solve this

question. The current captive population includes 48 wild-caught pandas

that have not reproduced, but only 32 of these are currently of

reproductive age. If these pandas can be encouraged to breed, the

captive population will not need additional genetic material from the

wild population to become self-sustaining. This is supported by

information from the 1996 MOC/CBSG Workshop.

Permittees who import pandas for captive breeding should actively

coordinate with all panda holders as much as possible and must

participate in the AZA's Giant Panda SSP or a similar plan approved by

the Service. Imports of pandas for the sole purpose of producing more

pandas would not likely satisfy the required finding of enhancement

under the ESA. Since it is expected most of the pandas to be imported

into the United States for breeding would have a history of not

reproducing, it is anticipated that there will be a research component

to any captive-breeding activities.

Exhibition

The policy proposed two alternatives for exhibition: (1) Exhibition

solely as an ancillary component, and (2) short-term exhibition. The

final policy reflects Alternative 1. Therefore, applications for import

of pandas solely for exhibition purposes would not be approved as a

general matter. This is consistent with the AZA moratorium on short-

term panda loans. Educational display (exhibition) would be allowed as

an ancillary component of a scientific research or research/captive-

breeding program, when the display will not interfere with the research

or captive-breeding activities. Even temporary loans of pandas solely

for display to another institution during the non-breeding season would

likely not be allowed, as this could be disruptive to behavioral

interactions, endocrine monitoring, and research designed to maximize

breeding success.

With advances in coordinated conservation efforts for the giant

panda, if institutions in the United States are exhibiting captive

pandas, the Service believes that the institutions should focus their

energy on activities that best ensure the recovery of wild pandas. The

Service recognizes that the use of any of these animals for short-term

exhibition could detract from the overall captive conservation efforts

by stimulating institutions to use resources for short-term exhibition,

rather than committing resources to needed captive breeding or

research. Furthermore, the use of breeding age pandas for short-term

exhibition loans could increase the stress and reduce acclimation of

pandas to breeding surroundings while minimizing the opportunities for

important research and captive-breeding activities. Thus, the Service,

as a matter of policy, discourages the issuance of permits for the

import of pandas for solely exhibition purposes (even though such

exhibits might raise substantial funds to go back to China). Every

panda import must have intrinsic conservation benefits in its own

right, in addition to financial contributions to China.

Primarily Commercial

Under CITES, Appendix-I species, such as giant pandas, cannot be

imported for primarily commercial purposes. Therefore, an applicant for

a giant panda import permit must provide sufficient information to the

Service to consider in making a finding that the import is not for

primarily commercial purposes [(50 CFR 23.15(d)(7)]. Thus, the language

on internal accounting systems was clarified in the final policy and

monitoring visitation was added as a way to provide additional

information needed to calculate net profits. No other major changes

were made in the final policy in this section.

Suitability of Facilities

Under the CITES regulations, the recipient of a giant panda is

required to have suitable housing and equipment to care for the

panda(s) [50 CFR 23.15(d)(6)] and under the ESA regulations at 50 CFR

17.22(a)(2)(vi), the facilities and resources must be adequate to

successfully accomplish the objectives stated in the permit

application. Applicants for a giant panda permit must submit sufficient

information to show that they meet these requirements. The proposed

policy enabled applicants to provide copies of existing protocols for

monitoring health and behavior recommended by a coordinated

international panda conservation effort. The final policy allows

applicants to submit protocols recommended by a coordinated panda

conservation effort, such as the AZA Giant Panda SSP, since there is no

one true organized international panda conservation effort at this

time. Additionally, the requirement to note any roads adjacent to panda

facilities was dropped since there is no evidence that shows activity

or noise from adjacent roads negatively affects panda behavior.

Transfers of Pandas to Other Entities Within the United States

The policy clarifies that persons intending to transfer live pandas

in the United States will need to meet the provisions of the policy,

either by obtaining an interstate commerce permit or prior approval of

the Service as conditioned by the import permit.

Summary of Comments and Responses

Comments on the proposed policy were received during four comment

periods (March to May 1995, June to July 1995, July to September 1997,

and September to November 1997) and were considered in formulating this

final policy. The following summarizes those comments organized by

elements in this policy. The Service received 205 comments (letters,

form letters, and form post cards) from 4 zoological institutions, 5

conservation groups, 7 animal interest groups, 3 business or trade

organizations, 1 State agency, 7 foreign governmental agencies, and 178

individuals. The Service has reviewed all of these written comments.

Comments or information updating the data presented in the

Supplementary

[[Page 45843]]

Information section are incorporated into that section of this final

notice.

Purposes

Issue: Several commenters suggested that there was no single

coordinated international panda conservation effort and that there

should be flexibility and discretion to pursue the primary goal of

survival of the species.

Response: The Service agrees that it may not be possible to have

all institutions worldwide that have pandas be part of one

international panda conservation effort. However, this should be a long

term goal and any U.S. institution wishing to import giant pandas

should participate in a coordinated panda conservation effort as much

as possible and should work closely with the Chinese government to

ensure their efforts are based on recommendations of China's National

Plan, National Survey, or the Captive Breeding Plan. The language has

been changed appropriately.

Issue: One commenter stated that the Service should withdraw the

proposed policy, abandon efforts to set any specific policy for imports

of giant pandas, immediately lift the moratorium on panda imports, and

evaluate imports on a case-by-case basis.

Response: The Service disagrees since pandas are critically

endangered and engender much public interest. The purpose of the policy

is to openly and clearly outline how applicants who wish to import

giant pandas can meet the criteria of CITES and the ESA. This policy

will be applied to each application for import on a case-by-case basis

and will provide clear guidance for consistent evaluation so pandas in

the wild will benefit.

Issue: One commenter thought the ban on importing giant pandas

should remain in place so that maximum conservation resources for

saving these animals could be focused on saving them in their natural

habitat. Other commenters stated that no giant pandas should be held in

a zoo.

Response: The Service agrees that conservation efforts should be

primarily focused on saving pandas in the wild. However, pandas that

are already in captivity can serve a role in conservation of pandas in

the wild. Captive pandas offer opportunities to conduct needed research

and can help to educate people worldwide on the plight of pandas. Money

generated from importing and exhibiting captive pandas can be used to

fund in-situ panda projects. While in the past, the motivation for

removing pandas from the wild was questionable, it is clear from the

December 1996 studbook, that very few pandas have been removed from the

wild in the past several years and the Captive Breeding Plan states

that no additional wild-caught pandas are needed to sustain the captive

population. The Service does not believe that importing captive pandas

into the United States at this time under the final policy will lead to

further removal from the wild. However, the Service will consider this

when evaluating specific applications and not allow the import of

pandas removed from the wild, except in exceptional circumstances. The

Service would be remiss if it did not allow activities with captive

pandas to occur, within the criteria of CITES and the ESA, that can be

shown to benefit pandas in the wild.

Wild-Taken Pandas

Issue: Several commenters did not believe the proposed use of

December 31, 1986, as the cut-off date to be justified in light of

current information on the limited removal of pandas from the wild and

the under-represented founder stock of the captive population. Another

commenter stated that they believed that the studbook data was

incorrect and that the MOF was actually ``rescuing'' more pandas than

was reflected in the studbook.

Response: The Service agrees that caution should be used when

considering imports of wild-caught pandas into the United States so

loans will not stimulate further wild take. However, a number of the

wild-caught pandas already in captivity have not bred and are very

important genetic founders, as determined in the MOC/CBSG Workshop. The

AZA Giant Panda SSP recognizes this as an area where U.S. zoos can use

their specialized expertise. The Service agrees that this would be an

appropriate issue for U.S. zoos to become involved in since pandas that

are known breeders would most likely remain in China as part of the

breeding program. Non-breeding pandas could potentially be exported to

the United States to research why they were not breeding. Additionally,

the MOC/CBSG Workshop report noted that no additional wild-caught

pandas were needed to sustain the captive population based on the

assumption that more captive pandas will become successful breeders.

The Service changed the date to December 31, 1996, to coincide with the

MOC/CBSG Workshop date based on information from the workshop,

including the updated studbook showing few recent wild-caught pandas

being added to the captive population, and on the previous information

from China on rescue guidelines. At this time, the Service has no

evidence that the studbook information is incorrect. Should information

become available through genetic research to show that more wild-caught

animals have been added to the captive population in recent years, the

Service will consider revising this section of the policy. Since each

import of a panda will be evaluated on a case-by-case basis, the

Service still reserves the right to deny the import of a wild-caught

animal, regardless of when it was removed from the wild, if the Service

determines that the removal from the wild may have been detrimental to

the species. It is unlikely that the Service would be able to make the

necessary finding to issue a permit to import any pandas ``rescued''

from the wild after December 31, 1996, since it was concluded that

these pandas are not needed for captive population maintenance.

Recently ``rescued'' pandas should remain in China to either be

returned to the wild or used in their captive-breeding program.

Age and Other Parameters of Animals Available for Loans

Issue: Several commenters agreed with the Service's proposal that

post-breeding age pandas not be considered for import due to risks

associated with transport. Several other commenters disagreed,

indicating there is no data to support the proposal.

Response: The Service agrees there is a lack of data on the risk of

transporting pandas over the age of 20, and therefore did not set an

upper age limit for pandas to be imported into the United States.

Additionally, since current research is not focused on aging in pandas,

this may be one area that U.S. institutions may want to conduct

research. The Service feels it should not eliminate the possibility of

doing this type of research in the United States. The Service will,

however, consider age as a factor in determining issuance of a permit

as it relates to the proposed purpose of import on a case-by-case

basis. Regardless of age, the Service agrees that, except in an

emergency situation where there is no reasonable alternative medical

care available, infirm animals should not be imported unless the

medical condition has improved to the point that transport will not

further compromise the health of the panda nor interfere with the

purpose of the import.

Length of Loans

Issue: Several commenters were opposed to short-term loans, in

particular for exhibition purposes. Another commenter felt length of

loans should be a function of permit purposes and flexibility should be

allowed in

[[Page 45844]]

order to accomplish the proposed activities in a reasonable period of

time.

Response: The Service feels the language in the proposed policy

allows flexibility but appropriately ties the length of the loan to the

proposed purpose of the import. Thus, the language in this section has

not been revised.

Enhancement and Conservation Benefits of Specific Projects

Issue: The MOC pointed out that China does not have one national

program for the conservation of the panda but both their agency and MOF

have panda conservation programs.

Response: The Service has clarified the language in this notice.

Issue: The Service received a number of comments on the proposed

distribution of net profits ranging from agreement with the proposed

policy to suggestions on different ways to divide the net profits,

including not designating a ratio. One commenter thought the policy

should not require all net profits be used for panda conservation only.

Another thought China should decide how funds are used.

Response: The Service agrees there should be some flexibility in

how net revenues are used for panda conservation but also strongly

believes that in-situ conservation should remain the central focus to

panda recovery. The Service has changed the policy to read that a

significant portion (rather than 80 percent) of all revenue related to

the holding of the pandas, not just net profits, should go to in-situ

panda conservation. Because there appeared to be some confusion in the

comments regarding the source of funds so allocated, the Service has

also changed the language in the policy to clarify this issue. To make

the required findings under the ESA and CITES, and work toward the

recovery of the giant panda, the Service believes that all panda funds

should be used for panda conservation. The Chinese government and the

applicant select the projects to be funded in the loan agreement. The

policy clarifies that the Service will consider whether these are

priority projects in panda plans developed by the Chinese.

Issue: One commenter stated that it was unreasonable to assume that

any movement of giant pandas generates funds and this part of the

policy concerning non-Chinese pandas be omitted. Several commenters

suggested that the criterion of ownership for allocation of funds be

dropped.

Response: The Service does not agree that it is unreasonable to

assume that any movement of pandas generates funds. The Service would

agree that putting pandas on exhibit may not result in an increase in

profit per se, but there have not been any imports which demonstrate

this. However, there are many examples showing that pandas on exhibit

generate revenue. Since the Service is changing the policy language for

pandas belonging to China to be more flexible, there would be little

difference in the distribution of revenue for the display of pandas

from China and for display of pandas from non-Chinese institutions.

Because of this, the Service has decided to eliminate the distinction

between pandas owned by China and pandas belonging to other entities.

The final policy states that a significant portion of all revenues for

any panda import should be used for in-situ conservation of pandas in

the wild with the remainder being used for either in-situ or ex-situ

panda conservation projects.

Issue: One commenter suggested that the Service clarify the

relationship between the Enhancement section and the Primarily

Commercial section by combining the sections or sequencing them to more

clearly acknowledge the ties between the two sections.

Response: The Service agrees and revised the policy language to

better explain these relationships. In order to validate the CITES

finding that the import is not for primarily commercial purposes, the

policy outlines that any net profit, over the time of holding the

animal(s), should be used to fund panda conservation projects in China.

In addition, the use of net profits and loan agreement monies to fund

conservation projects is part of the findings under the ESA, which

requires that the import benefit the conservation of the species in the

wild. The Service believes that to reach conservation and enhancement

of pandas in the wild, all funds generated by pandas should be used for

pandas and not directly for other species. The Service also continues

to believe that permittees need to track net profits and project status

to ensure the integrity of the original findings.

Issue: Commenters both supported and opposed the proposed policy

requirement to monitor progress of projects funded for panda

conservation in China.

Response: The Service believes the use of funds in meaningful panda

conservation activities in China is a key means to help reach

conservation and enhancement under the ESA and the ability to verify

that this is being met is crucial. Therefore, the Service did not alter

the requirements in this section of the policy.

Issue: One commenter noted that there are several types of in-situ

conservation projects that should be the highest priorities for support

from panda loan revenue, including the National Survey scheduled to

begin in 1998.

Response: The Service agrees that priority should be given to

funding the National Survey and urges institutions to strongly consider

funding this effort during their negotiations to obtain pandas. The

Service also agrees that it may be useful to utilize panda revenues to

integrate field staff into projects and to support field educational

activities and will consider this when reviewing giant panda import

applications.

Scientific Research

Issue: One commenter stated that scientific research on panda

reproduction should be conducted only in the wild, not in zoos or

artificial study facilities. Other commenters stated that the policy

should recognize the expertise and capability outside of China that can

be used to assist the international effort.

Response: The Service believes there are studies which can be

conducted on captive animals that would provide information useful in

studying or managing wild panda populations. Captive pandas should be

utilized to the greatest extent possible to benefit the wild

populations. Scientific research both in China and the United States is

one area where this can happen.

Issue: Two commenters thought the proposed policy was too intrusive

and burdensome. The requirements exceed the Service's goal of ensuring

that applicants are engaging in valid and needed research and could

cause delays or limit research. Two commenters supported the Service's

detailed requirements.

Response: The Service believes an applicant must clearly show that

the scientific research is bona fide and will contribute to the

conservation of the panda, particularly in the wild. This information

is similar to information researchers routinely submit to receive other

research grant funds and is information that a scientist needs to

conduct a valid investigation. The Service needs to be informed of

major procedural changes in the research since the granting of an

import permit for scientific research is based on a particular research

proposal. Radical changes in a scientific investigation could be reason

for suspending a permit if the research no longer contributes to panda

conservation. The Service will make every effort to evaluate any

proposed changes in a research program

[[Page 45845]]

in a timely manner so research is not interrupted, but it is also

important for the permittee to alert the Service to changes as soon as

possible.

Issue: One commenter suggested that milk be added to urine, feces,

and synthetic DNA as substances that would not require a permit for

export or import, when collected as outlined in the proposed policy.

Another commenter indicated that until another decision is made by the

Conference of Parties to CITES, the Secretariat considers urine, feces,

and synthetic DNA as covered by CITES.

Response: The Service has not included milk in this short list of

exempted by-products at this time since, for the most part, it cannot

be obtained without manipulating an animal. The Service has written the

Secretariat outlining the U.S. position on urine, feces, and synthetic

DNA and recognizes that some countries may require permits for these

products. That is why the policy recommends that people contact the

foreign CITES Management Authority to meet their requirements.

Issue: One commenter disagreed that facilities to house pandas

needed to be separate and apart from the public exhibition facility as

there is no evidence that exhibition would interfere with research and

it could be extremely costly. Another commenter stated that a recipient

zoo should provide adequate off-exhibit space in which to conduct

research.

Response: In considering the comments, the Service changed the

policy to no longer require housing or research areas totally separate

and apart from the exhibition areas, but the applicant/permittee should

have adequate housing away from public view should the Service

determine that exhibition of the pandas is not compatible with the

research.

Captive Breeding

Issue: One commenter strongly agreed with the need to: (1)

Coordinate the movement of captive-held pandas internationally since

the captive-breeding effort in China is not currently self-sustaining

and (2) enhance captive propagation efforts, with special emphasis on

unrepresented founders, particularly males.

Response: The Service continues to believe that breeding of

captive-held/captive-born pandas needs to be coordinated

internationally. The MOC/CBSG Workshop held in December 1996 in Chengdu

is an excellent step toward this goal.

Issue: One commenter recognized the concerns of the Service about

the role of captive breeding but felt requiring a detailed breeding

protocol was unnecessary and intrusive. Another commenter stated that

since the policy requires all applicants to be members of a coordinated

international effort, the Service should defer to those coordinated

efforts (AZA programs and SSPs) to ensure that an institution has the

necessary facilities and expertise to import a panda.

Response: The Service needs to be assured that any applicant

wishing to import a giant panda for breeding has the necessary

knowledge, expertise and facilities to accomplish their goal. In order

to be more flexible, the Service will accept a statement that the

applicant is following the AZA Giant Panda SSP recommendations for

breeding protocols in lieu of submitting the actual protocol. However,

the Service will still require submission of facility and exhibit

information in the form of photographs, diagrams, and written

description with each application.

Issue: One commenter did not agree that the name, position, and

qualifications of the individual making the decision to take animals

off display must be supplied but thought that this decision should be

made by the institution's animal managers.

Response: The Service agrees that the submission of this

information is not necessary and has removed the language from the

policy.

Exhibition

Issue: A majority of the commenters supported Alternative 1 which

proposed to allow imports for exhibition solely as an ancillary

component. One commenter, while generally supporting this alternative,

also recommended that the Service recognize the role of exhibition in

raising revenues necessary to support conservation efforts.

Response: The Service selected Alternative 1 for the final policy.

Although exhibition typically cannot be the sole purpose of an import,

the Service expects it will be a component of most applications and the

funds raised will be considered when making the enhancement finding

under the ESA.

Primarily Commercial

Issue: One commenter stated that the Service does not have the

authority to propose that all net profits resulting from the import of

a panda for long term captive-breeding loans be used for the

conservation of pandas in the wild; the Service should recognize that

long term breeding loans are inherently not for primarily commercial

purposes and that the intended purpose of the loan, to save the giant

panda, is non-commercial.

Response: The Service has the authority to propose how net profits

should be used, since this is a part of the not for primarily

commercial purposes and conservation/enhancement findings. The Service

does not have enough information at this time to conclude that long

term breeding loans are inherently not commercial. The intent to save

giant pandas does not necessarily mean that an institution would not

also want to generate revenue while contributing to the panda

conservation effort. Historically, the exhibition of pandas has

generated much public interest and short-term loans have generated much

revenue for the institution exhibiting them. There has only been one

long term loan undertaken and it has only been in effect for little

over a year. Until more experience is gained, the Service needs to

review each application for import and receive information, in the form

of accounting for profit, to satisfy itself that the initial finding

that the import was not for primarily commercial purposes remains valid

for long term loans.

Issue: One commenter was concerned about the degree of specificity

applied to allowable expenses and suggested language to clarify

reasonable expenses.

Response: The Service agrees that these recommendations will

provide additional flexibility and has incorporated them into the

policy. The clarifying changes do not affect the Service's ability to

review the data submitted and to ensure that its finding that the

permitted activity is ``not for primarily commercial purposes'' remains

accurate.

Issue: Two commenters felt that to make the not-for-primarily

commercial finding requires an initial determination concerning the

overall purpose as well as a need for ongoing review in order to be

satisfied that those purposes are being met. One commenter added that

the same measures for compliance with CITES have to be met for each and

every applicant.

Response: The Service agrees with this evaluation which is

reflected in the policy.

Issue: Commenters sought clarification of the term ``indirect

revenues.'' One of these commenters suggested that since the proposed

policy used only direct expenses, the final policy should use a similar

approach for calculating revenue. Commenters also stated that the

Service should clarify that the cost of the loan is included in

reasonable expenses. One commenter

[[Page 45846]]

added that the cost of technology transfer programs and education

programs in the United States also be included.

Response: The Service agrees with the above and has changed the

policy.

Issue: Two commenters stated that it will be extremely difficult

for an institution, over long periods of time, to accurately assess the

exact ``net profits'' related to a panda loan.

Response: The Service agrees that it may be difficult to assess

exact net profits over time, but reasonable information is necessary to

continue to assess that the import is not for primarily commercial

purposes.

Issue: One commenter believed that exhibition of pandas for

whatever purpose remains ``primarily commercial'' and thus falls under

the restriction applied to CITES Appendix-I listings.

Response: The Service does not agree that exhibition of pandas

should automatically be determined primarily commercial. It is true

that exhibition of pandas generates revenue, but if no net profits are

generated or if net profits are generated but are used for conservation

of the affected species, the Service can conclude that the import was

not for primarily commercial purposes.

Issue: Several commenters suggested language changes to help

clarify the intent of the section on internal accounting systems.

Response: The Service agrees with these suggestions and has revised

the policy accordingly.

Issue: One commenter felt the proposed policy was too restrictive

in requiring approval from the Service if the permittee changes the

conservation projects to be funded from those presented in their

application; this requirement was unnecessary and appears to intrude in

the internal affairs of a sovereign nation since all conservation

projects are to be high priorities of the China's National Plan.

Response: To make the findings under the ESA and CITES, the Service

needs to consider whether the funds will be used to support priority

conservation projects identified by the Chinese government in the

National Plan, National Survey or Captive Breeding Plan. The Service

sees this as a way to support China's management of pandas. Requiring

permittees to obtain approval from the Service if they change the

conservation projects to be funded ensures that funds are going to

priority projects identified by the Chinese government in these plans.

Issue: One commenter recommended that reports only be required on a

multiple-year basis, such as every five years. Another commenter

recommended that the Service carefully review and monitor financial

reports annually to determine whether the commercial test is actually

being met, and that the policy provide for possible adjustments in

conservation funding commitments based on actual panda-related income.

Response: The Service believes that it is important to review the

information on primarily commercial before too much time elapses and

has retained the requirement for an annual report.

Issue: One commenter was concerned by the level of what they

considered to be micro management; suggested the Service is not

equipped to deal with the internal accounting procedures and annual

reports as proposed in the policy; and thought the use of marketing

data (such as visitors surveys) would be a more productive way to

obtain information on revenue earned due to exhibition of giant pandas.

Response: The Service feels that the collection of this level of

information has been useful in evaluating the current permit held by

the San Diego Zoo. The Service agrees that marketing data such as

visitation monitoring is also important to collect since it allows for

more accurate calculation of how much revenue a facility is generating

because of pandas and has revised the policy.

Issue: One organization stated that the disparate treatment

business corporations are subjected to under the current policy for

``short-term exhibition only'' loans should have no place in a final

policy dealing with long term captive-breeding loans. They added that

it is the intended use of the species, not the tax status of the

applicant, that should be of concern and that the Service should not

impose a higher burden of proof on business corporations to engage in

long term captive-breeding loans under the AZA plan. Another commenter

stressed that the difficulty for commercial entities is inherent in the

treaty language itself; since commercial entities have as a fundamental

purpose the pursuit of profit, assurances will be sought from profit-

making entities just as from non-profit entities that the requirements

of CITES are being met in an ongoing manner.

Response: The Service views ``for-profit'' (business corporations)

institutions as having a more difficult time in satisfying the burden

of proof, since they are founded with the purpose of making a profit

and have additional factors, such as a fiduciary duty to stockholders,

that must be addressed in the finding that an import is not for

primarily commercial purposes. The captive breeding example in

Resolution Conf. 5.10 specifically mentions the need to account for

benefits to stockholders.

Issue: One commenter cited WWF v. Hodel, Civ. No. 88-1276 (D.D.C.

1988) as evidence that the Service acknowledged that CITES does not

require the types of restrictions that the proposed policy applies in

connection with the issue of commercialism. Another commenter stated

that they are also well aware of this case and pointed out that the

position taken by DOI on commercialism was in fact rejected by the

Court in that matter.

Response: In World Wildlife Fund v. Hodel, District Judge Johnson

found that the Service had failed to articulate the reasons supporting

its ``implicit'' finding that the importation of giant pandas by the

Toledo Zoo for short-term exhibition purposes ``was not primarily for

commercial purposes.'' Judge Johnson, after determining that the

additional fee charged by the Toledo Zoo for the public to view the

pandas was ``significant to a consideration of the CITES requirement

that the import was not primarily for commercial purposes'', issued a

preliminary injunction against the Toledo Zoological Gardens to prevent

the collection of such additional fees. While Judge Johnson's ruling

did not prescribe a firm boundary between those activities that are

primarily commercial in nature from those that are not, her ruling did

correctly identify the responsibility of the Service to explain the

basis of its permitting action with particular emphasis on statutory

and treaty-based requirements and criteria. In dealing with complex

permitting questions like those covered by this policy, it is the

Service's goal that decisions be made on the basis of complete

administrative records and fully explained records of decision. This

policy was intended to achieve that goal, especially on the complex

findings and determinations that must be made as a prerequisite to

issuing any import permits for giant pandas.

Suitability of Facilities and Care

Issue: One organization commented that their experience with pandas

has led to the realization that exercise and open space may be much

more important for the well-being of pandas than had previously been

thought. The suitability of facilities and care should be directly

associated with the purposes of the permit.

Response: The Service agrees the suitability of facilities and care

is tied directly with the purposes of the permit.

[[Page 45847]]

In addition, the amount of open space or opportunities for pandas to

exercise will be considered during review of permit applications when

deciding whether permit issuance criteria under CITES and the ESA are

met.

Issue: One commenter did not understand why the Service needs to

know the existence of adjacent roads to the panda facility and urged

this requirement be deleted.

Response: At the time the proposed policy was written, the Service

was concerned about the impact of traffic noises on panda behavior.

Since then, the Service has received information from facilities

holding pandas that pandas are unaffected by routine traffic noises.

Thus, this has been deleted from the policy.

Issue: One commenter suggested that the Service require that the

importer account for the animals' psychological, behavioral, and

physical needs while housed prior to, after, and during transport.

Additionally, a veterinarian with expertise in panda well-being should

be required to travel with any imported animal to ensure direct and

immediate care throughout the trip.

Response: Importers of pandas are required to ship the animals

under humane and healthful conditions and follow the regulations on

providing care, food, and water during transport (50 CFR Part 14,

Subpart J). The Service agrees that it is a good idea for a

veterinarian or other animal care personnel with expertise in panda

care to accompany pandas. In the past, China has required Chinese

caretakers to accompany pandas in transit. Since the Service is not

aware of any problems that have occurred during prior shipments of

pandas, the Service does not believe it is necessary to change the

policy at this time.

Transfer of Pandas to Other Entities Within the United States

Issue: One commenter did not understand the grounds for requiring

an interstate commerce permit to transfer loaned giant pandas to other

entities within the United States.

Response: Under the ESA, the transfer of a giant panda to another

institution across state lines constitutes interstate commerce, and

therefore requires an ESA permit, since it is expected that the

receiving facility gains financially or otherwise by having that animal

at their facility. The Service has a long-standing policy that

legitimate non-commercial breeding loans do not need interstate

commerce permits because they generally do not involve the transfer of

specimens in the pursuit of gain or profit. However, panda loans

present exceptional facts that require the recipient of any panda

transfer to address all the elements of the panda policy and interstate

commerce permits would be required for any interstate transfer since

exhibition of giant pandas generate much public interest and monetary

gain for the exhibiting institution.

Issue: One organization commented that it is burdensome and

decreases the flexibility in a breeding program to require an applicant

to indicate in the import application any intended transfers of the

pandas within the United States at a later time.

Response: The Service agrees that an importer may not be able to

project whether the pandas they wish to import would need to be moved

to another facility at a later date and has deleted the requirement to

anticipate interstate movement prior to import under the policy.

However, the subsequent transfer of a panda will need to meet the

provisions of the policy through an interstate commerce permit or

intrastate transfer authorization from the Service as conditioned under

the import permit. This is to ensure that all transfers meet the

approval of the Chinese government or the entity that owns the animal

and meet the purposes of the original import under CITES and the ESA.

Required Determinations

Issue: One organization stated that Executive Order 12866 requires

any significant regulatory action be reviewed by the Office of

Management and Budget. The Executive Order defines ``significant

regulatory action'' to include those actions which ``* * * raise novel

legal or policy issues arising out of legal mandates, the President's

priorities, or the principles set forth in this Executive Order.''

Section 1(a) of the order states: ``The Regulatory Philosophy. Federal

agencies should promulgate only such regulations as are required by law

* * * or are made necessary by compelling public need, such as material

failures of private markets to protect or improve * * * the environment

* * *'' Based on the definition of ``significant regulatory action''

and Section 1(a), the commenter asserted that the Service's proposed

policy should be subject to OMB review. They further stated that their

comments on the proposed policy question whether the ``primarily

commercial purposes'' standards the Service proposes ``are required''

by law, and whether there is a compelling public need for the policy

based on ``* * * material failures of private markets to protect or

improve * * * the environment * * *'' The commenter believes that the

``private market'' of zoological institutions, and specifically in this

case the AZA, has protected and continues to protect endangered species

like the panda through non-governmental captive-breeding programs.

Response: While the Service believes that this action is a policy

and not a rule, it has followed the Administrative Procedures Act, the

Regulatory Flexibility Act, and Executive Order 12866. The policy sets

out guidance that is intended to assist the decision-makers and staff

within the Service to carefully review applications for panda import

permits, to ensure that all statutory and treaty-based criteria have

been addressed and fully explained in the administrative record, and,

assuming that these goals are met, to thereby enhance the conservation

of the giant panda. The policy does not prescribe new restrictions or

limitations of general application to those who would apply for such

permits, but instead sets out a ``road map'' on how to develop and

submit a complete application in light of the best available scientific

information available to the Service at this time. No regulatory impact

analyses are required by law for the adoption of this statement of

agency policy. Even if such analyses were required, nothing in this

policy could be construed to impose an economic impact that does not

already exist as a result of the ESA and CITES.

Other Issues

Issue: One commenter pointed out that CITES Notification No. 932

(Loans of Giant Pandas) does not carry forward the implied criticisms

of captive breeding outside of China contained in the CITES Standing

Committee document, Doc. SC.36.15. The notification explicitly

recognizes that there may well be a role for institutions outside of

China for captive breeding. The repeal of Notification No. 477 removes

any open criticism by the Secretariat or the Standing Committee of

captive breeding, especially as this purpose relates to commercialism.

Response: The Service agrees that Notification No. 932 recognizes

the export of giant pandas for captive breeding under specific

circumstances, and believes this has come about because of the positive

changes in panda conservation efforts in China and elsewhere.

Issue: One commenter believed that reasonable assumptions on the

question of commercialism can be drawn from the Notification and Doc.

SC.36.15. The first assumption is the Secretariat's view that the giant

panda is not actually or

[[Page 45848]]

currently threatened by international trade. The second assumption is

that panda loans can be made in accordance with the normal provisions

of CITES. All that is necessary in addressing commercialism is

application of the standard provisions of Conf. 5.10.

Response: The Service agrees. The Secretariat also cautioned that

care needs to be taken that the money offered to China reflect the real

value of pandas to that institution and are not a ``token gesture,''

with the bulk of the monies being retained by the institution itself

for its own benefit. The Secretariat noted that the latter would be

incompatible with the requirement that imports of Appendix-I species be

for purposes which are not primarily commercial.

Issue: One commenter stated that the application of the CITES

standard to only export Appendix-I animals in exceptional circumstances

should not be confused with the subjective and limited definition, when

there is a high degree of probability of captive breeding taking place.

Another commenter added that the emphasis should be on the ``best

interest of the whole species.''

Response: The Service believes that Section 3.c of Notification No.

932 should be interpreted to mean that breeding age animals should only

be exported to institutions either in potential breeding pairs or

singly to facilities that already have breeding age panda(s). This is

further qualified by limiting exports to institutions that cooperate

with others in a breeding program. The Service does not believe that

this would exclude the possibility of exporting animals that have not

bred in China to a United States breeding program, such as AZA's Giant

Panda SSP, in which the focus is to research why these pandas have not

successfully bred.

Issue: One commenter stated that the Service does not have the

authority to implement Notification No. 932 and the proposed policy

itself can only be implemented and enforced as a formal Service

regulation adopted after rulemaking procedures.

Response: The Service has discretion to formulate policy that

defines or clarifies how to interpret or implement already existing

regulations, in this case 50 CFR Parts 13, 17, and 23 for a particular

species.

Issue: One commenter stated they were very concerned by the

negative impact this policy has had on commercial entities in their

desire to help panda conservation through long term breeding loans that

would result in in-situ financial contributions and captive breeding

research in the United States.

Response: The Service recognizes that commercial institutions can

potentially make significant contributions toward conservation programs

for endangered species. However, in the case of all Appendix-I imports,

including giant panda imports, the Service is obligated to determine

that the import is not for primarily commercial purposes. Commercial

entities must be able to show that they will not economically gain by

the import over time, before the Service can approve an import permit.

These types of institutions could still contribute financially to panda

conservation, without importing the animals, if they chose to do so.

With publication of this policy, the Service lifts the suspension

of the review and processing of permit applications to import live

giant pandas, which has been in place since December 20, 1993. The

policy is effective immediately to allow organizations that have, or

are finalizing, loan agreements with China to apply without further

delay. Accordingly, we have good cause under 5 U.S.C. 533(d) to waive

the 30-day effective date. Applicants should allow at least 120 days

for the processing of an application. This time frame includes a notice

in the Federal Register of the availability of each application for a

30-day public comment period as required under the ESA.

Required Determinations

The information collection requirements identified in this policy

as part of the permit application have been approved by the Office of

Management and Budget under the Paperwork Reduction Act, 44 U.S.C. 3501

et seq. and assigned clearance number 1018-0093. OMB has reviewed this

document under Executive Order 12866.

The Service has determined that this policy is categorically

excluded under Departmental procedures from complying with the National

Environmental Policy Act (NEPA) (516 Departmental Manual, Ch. 2, Appx.

1, paragraph 1.10). An Environmental Action Memorandum is on file at

the Service's Office of Management Authority in Arlington, Virginia.

Policy on Import of Giant Pandas

Given the long history and controversial nature of the issue of

giant panda imports, the Service considers the conservation status of

the giant panda sufficiently unique to warrant establishment of a

separate policy on the import of giant pandas. The policy sets out

guidance that is intended to assist the decision-makers and staff

within the Service to carefully review applications for panda import

permits, to ensure that all statutory and treaty-based criteria have

been addressed and fully explained in the administrative record, and,

assuming that these goals are met, to thereby enhance the conservation

of the giant panda. The policy does not prescribe new restrictions or

limitations but instead sets out a ``road map'' on how to develop and

submit a complete application in light of the best scientific

information available to the Service at this time.

Before a decision is made on any application for a permit to import

or engage in interstate commerce in giant pandas, the Service must

review the application in terms of the applicable requirements of CITES

and the ESA. Issuance of an import permit under CITES requires prior

findings that: (1) The proposed import would not be for purposes

detrimental to the survival of the species; (2) the import would not be

for primarily commercial purposes; and (3) the permit applicant is

suitably equipped to house and care for the animals. Issuance of a

permit under the ESA requires prior determinations that, among other

things: (1) The activity would be for scientific purposes or to enhance

the propagation or survival of the species, in a manner consistent with

the purposes and policies of the ESA; and (2) issuance of the permit

would not be likely to jeopardize the continued existence of the

species. These requirements are further implemented by application

requirements and issuance criteria found in 50 CFR 13.12, 17.22, 23.14,

and 23.15. In addition, Section 9(d) of the Lacey Act, with regulations

at 50 CFR 14, Subpart J, requires that shipments of live wild mammals

being shipped to the United States are done under humane and healthful

conditions such that the animals arrive alive, healthy, and uninjured.

This policy provides guidance on Service consideration of these

requirements relative to the giant panda only. These considerations and

this policy are in no way intended to apply to import permit

applications for other species. All such applications must continue to

demonstrate that the proposed imports meet the applicable requirements

of CITES and the ESA consistent with the conservation status of the

particular species in question and the best scientific information

available for that species.

[[Page 45849]]

Purposes

The primary goal of the policy is to ensure that all permitting

decisions involving the transfer of giant pandas into and within the

United States contribute toward the survival, and ultimately the

recovery of panda populations in the wild. The long term goal is to

have all captive-holders of giant pandas cooperate in one international

plan. Toward that goal, all transfers should be part of a coordinated

panda conservation effort, a term used in this policy to mean an

organized effort through which all giant panda movements support high

priority projects in China's National Plan, National Survey, or Captive

Breeding Plan. If an import or transfer has breeding as one of its

purposes, the institution should also coordinate their activities with

China's Captive Breeding Plan and must participate in AZA's Giant Panda

SSP or a similar plan approved by the Service, as required generally

under existing regulations. The Service anticipates that most permit

applications will be for multiple purposes. Applicants must identify

the primary purpose for the proposed import or interstate transfer and

all other intended purposes. No activities for additional purposes

should be undertaken after issuance of a permit without prior approval

from the Service since issuance of the permit would be based on the

purposes identified in the initial application.

The ultimate objective of managing captive pandas should be for

research or research/breeding purposes, and any training or use of

pandas in animal acts would detract from this objective. Therefore, use

of pandas in animal acts or shows most likely would not meet the

current permit issuance criteria in the regulations and is discouraged

under this policy.

Wild-Taken Pandas

The following criteria would be used when evaluating import

applications involving pandas removed from the wild. These temporal

criteria are based on information available to the Service suggesting

that the removal of pandas from the wild has increasingly come under

Chinese control, starting prior to the WWF Plan of August 1989.

In all cases, the Service continues its policy of approving import

permit applications only when it is sure that the import did not, or

will not, contribute to the removal of pandas from the wild.

1. For wild-taken pandas, those removed from the wild prior to

December 31, 1996, would be considered eligible for inclusion in an

import permit.

2. Pandas removed from the wild after December 31, 1996, are not

likely to be eligible for inclusion in an import permit, in part

because the MOC/CBSG Workshop report states that no additional wild-

caught pandas are needed to have a self-sustaining captive population.

No Detriment Finding Under CITES

Under CITES Article III.3(a), the import of any specimen of a

species included in Appendix I requires a finding by the country of

import that the import will be for purposes that are not detrimental to

the survival of the species. This finding must be made within the

context of the fundamental principle that trade in specimens of

Appendix-I species must only be authorized in exceptional

circumstances. This finding is made on a case-by-case basis, and is

governed by the best available scientific information and the status of

the species involved, both in captivity and the wild. The finding also

considers whether the intended purposes cannot be achieved by other

means (better alternative uses for the animals). Relative to imports of

giant pandas, this finding will focus on ensuring that an import will

not adversely affect wild populations by directly or indirectly causing

the removal of animals from the wild either for the specific import

under consideration or by creating a perception that additional imports

will be authorized. The finding will also consider the purpose for

import to ensure that it contributes to improving the conservation

status of the species.

Age and Other Parameters of Animals Available for Importation

1. The Service will consider the age of the pandas and how it

relates to accomplishing the proposed activities.

2. The Service also will consider how each specific panda relates

to accomplishing the proposed activities and how it was selected to

ensure the import will not interfere with China's research and breeding

programs.

3. Except in an emergency situation where there is no reasonable

alternative medical care available, an infirm animal will not be

allowed to be imported unless transport will not further compromise the

health of the panda or interfere with the purposes of the import.

Humane Shipment and Transport

Any giant panda shipped to the United States must comply with the

regulations in 50 CFR Part 14, Subpart J: Standards for the Humane and

Healthful Transport of Wild Mammals and Birds to the United States.

Shipments of pandas by air must meet the International Air Transport

Association's Live Animal Regulations. The Service will evaluate

proposed shipping containers to ensure that live pandas shipped to the

United States arrive alive, healthy, and uninjured and that

transportation occurs under humane and healthful conditions.

Length of Loans

In situations where the movement of the panda is part of a loan

agreement, the Service will evaluate the length of time requested for

the loan to ensure it is appropriate to the proposed activity. The

length of the loan should be of sufficient duration to accomplish the

stated goals. It is anticipated that such activities may require 3 to 5

years, or longer, to produce research results for the maximum benefit

for captive-breeding activities or to produce research results that

benefit captive and wild populations

Section 7 Consultation Under the ESA: No Jeopardy Finding

Under section 7 of the ESA, the Service is required to insure that

its permit action to allow import, export, and interstate or foreign

commerce involving giant pandas is not likely to jeopardize the

continued existence of that species. The Service will conduct

consultation which will conclude with issuance of a biological opinion

stating whether the proposed action is or is not likely to jeopardize

the continued existence of the giant panda. A biological opinion will

be prepared for each permit application.

Each biological opinion will include a description of the proposed

action and take into consideration the status of the giant panda in

China, the status of the giant panda in captivity (domestic and

international), the effects of the action, and the cumulative effects

of the action. If it is determined that the proposed action is likely

to jeopardize giant pandas, reasonable and prudent alternatives would

be recommended to avoid jeopardy. In the event no reasonable and

prudent alternatives are available, the Service will not issue the

permit.

If a specific biological opinion concludes the proposed permit is

not likely to jeopardize giant pandas, an incidental take statement

will be provided to address the anticipated incidental take, if any,

that would result from the permit issuance. In addition, the incidental

take statement would include terms and conditions to

[[Page 45850]]

minimize the impact of incidental take. Such terms and conditions would

also be incorporated into the ESA permit.

Enhancement and Conservation Benefits of Specific Projects

Enhancement of the propagation or survival of a species and

conservation benefits for scientific research under the ESA can be

achieved through the following: (1) The proposed activities must

ultimately benefit pandas in the wild, and (2) all funds should be used

for giant panda conservation including habitat protection or captive

breeding efforts, with a significant portion of all funds being used

for in-situ conservation projects for the giant panda. Both of these

elements should be met to address the conservation/enhancement finding.

1. Whenever funding (import or loan agreement, fundraising money,

and net profits) is associated with the import or transfer of giant

pandas, the following should be addressed:

(a) Conservation projects to be funded should address the

following:

They should be included in China's National Plan, National

Survey, or Captive Breeding Plan and should be formally approved by

China's Project Office of MOF, MOC, or other appropriate entity.

They should be considered a high priority in the most

recent Plan.

They should be described as specifically as possible, with

funding allocations to specific tasks given in foreign currency (e.g.,

yuan) and in U.S. dollars, and projected timeframes given for use of

the funds to initiate and complete specific projects or activities.

Conservation projects that do not meet the above criteria

will be considered by the Service, if compelling reasons are given.

Any change in conservation projects to be funded once a

permit is granted would be considered an amendment and would need prior

approval of the Service.

(b) The applicant should provide a plan to monitor the disbursement

of funds for selected conservation projects or activities. The plan

needs to be sufficiently complete so that the Service is satisfied of

its effectiveness and is assured the projects will be completed. Such a

monitoring plan should include provisions equivalent to the following:

Before funds are transferred to the appropriate office in

China or the lending entity, the permittee and the appropriate foreign

entity should agree on a detailed budget, work plan, and timetable for

project completion. Specific, measurable objectives and a schedule for

progress reports should be identified for each project.

Payments should be made in installments. Each payment

needs to be linked to actions taken toward completion of the

project(s).

Subsequent payments should be contingent on approval of

progress reports by the permittee.

An assessment should be conducted annually to verify

progress toward project implementation.

The permittee should have permission from the Chinese

implementing agency or lending entity for the permittee, an authorized

representative, and the Service to examine records and to make site

visits to funded projects at least annually if needed.

(c) Funds (import or loan agreement money, fund raising money, and

net profits) associated with the import/transfer of giant pandas should

be allocated for panda conservation as follows (see Primarily

Commercial Purposes for additional discussion of net profits):

A significant portion of the funds should be used for in-

situ conservation projects for the giant panda and its habitat in China

as listed in China's National Plan, National Survey, or Captive

Breeding Plan.

The remaining funds should be used to support panda

conservation including breeding or educational efforts for the giant

panda in China or additional in-situ projects or, if the panda

originated in a country outside of China, panda conservation projects

outside of China.

In the event that funds generated exceed the ability of

the Chinese to apply the monies to priority projects or captive

breeding in China at any one time, then funds may be used to support

breeding efforts for the giant panda outside China.

The allocation of funds for other uses than outlined above

will be considered by the Service if compelling reasons are given.

Any change in allocation of funds once a permit is granted

would be considered an amendment and would need prior approval of the

Service.

2. If neither the payment of money nor the generation of revenue

are associated with the import or transfer of live pandas, the

applicant should provide information to the Service to show

convincingly that the results of the proposed activities will

contribute significantly to the conservation of the panda in the wild.

3. Annual reports to the Service will be required, which should

give an accounting and report of funds transferred and portions of the

conservation project completed (see Primarily Commercial Purposes for

further reporting requirements). Copies of reports received by the

applicant from the recipient of funding should be included, with

English translations if reports are not in English.

The policy considerations concerning the enhancement and

conservation benefits in this Section and in the related sections on

the types of activities for which a permit can be issued--Scientific

Research, Biological/Scientific Samples, Captive Breeding, and

Exhibition--would be used by the Service relative to the giant panda

only. These considerations and this policy are in no way intended to

apply to import permit applications for other species. All such

applications must continue to demonstrate that the proposed imports

meet the applicable requirements of the ESA and CITES consistent with

the conservation status of the particular species in question and the

best scientific information available for that species.

Scientific Research

One of the purposes of the ESA is to provide a means whereby the

ecosystems upon which endangered and threatened species depend may be

conserved. The ESA defines ``conservation'' as the use of all methods

and procedures which are necessary to bring an endangered or threatened

species to the point it no longer needs to be protected by the ESA.

There is a great need for scientific research on the giant panda, both

in the wild and in captivity to help achieve this goal. If permits are

issued for imports of live animals for a combination of research and

captive breeding, the proposed research must contribute to panda

conservation but may be more focused on captive populations.

1. The applicant must provide information to show that the research

is bona fide, meaning research that is properly designed using the

scientific method, and can be accomplished with the expertise and

resources available. This should include:

Objectives and goals should be clearly defined in the

research protocol. Hypotheses and experimental designs intended to test

them should be described. Any subsequent substantive procedural changes

and/or additions must be pre-approved by the Service. The Service will

review changes in a timely manner so as not to disrupt the research as

applicable.

Investigative procedures and research protocols should be

described in detail or referenced as published in

[[Page 45851]]

a recognized refereed, peer-review journal.

Estimated time frames need to be given.

Research should not be duplicative unless it is a

collaborative effort, or if repetition can be justified.

The results of the research would be expected to identify,

evaluate, or resolve panda conservation problems or contribute to the

basic knowledge of panda biology and ecology deemed important to the

survival of the panda.

The research results would likely be published in a

recognized refereed, peer-reviewed scientific journal.

2. The applicant must have the expertise and resources to

accomplish the stated objectives of the proposed research, and describe

how the research would not conflict in any way directly or indirectly

with known conservation programs for that species. For research with

live pandas:

Research should be recognized as a high priority activity

in China's National Plan, National Survey, or Captive Breeding Plan.

The proposal should describe how the study may contribute

to the conservation of the giant panda in the wild. If portions of the

research are in-situ, the research must be a collaborative effort with

Chinese scientists. For any ex-situ portion of the research, the

applicant should describe why it is best conducted outside China, and

how any information gained or methodologies developed will be

transferred for use in China, including estimated time frames of

transfers, training, or collaborative efforts.

Any physically invasive procedures to be used or any

behavioral modifications anticipated as part of research activities

should be described.

The permittee must provide an annual report summarizing

research activities associated with the purposes of the permit,

including a brief description of each project, a copy of protocols

developed and methodologies used, a summary of data collected with a

discussion of results and copies of published papers resulting from the

research. The report must also indicate whether the research resulted

in the development of protocols or other methodologies, if the products

were transferred to the Chinese government, and how they have been or

will be used for giant panda conservation.

3. If live pandas are going to be on exhibition at any time during

the term of the research project, the following should be addressed:

The applicant should provide protocols outlining how the

research and exhibition will be monitored to ensure that having the

pandas on exhibit is not interfering with the research or biasing data.

In lieu of submitting the protocol, the applicant may cite the

protocols of the AZA Giant Panda SSP or other relevant breeding plan.

The applicant must have adequate facilities to conduct the

research and provide information on alternative facilities to house the

pandas away from public exhibition in case it is found that exhibition

interferes with the research. The off-exhibit space, in addition,

should be large enough to provide an adequate exercise area should

panda(s) need to be housed there on a long term basis.

Biological/Scientific Samples

Permits for import of panda biological samples can be issued for

scientific research (including, but not limited to, genetic research,

monitoring of health status and diagnosis of disease or other

pathological conditions, physiological and behavioral research,

assessment of contaminant loads, and gene banking).

For research involving biological samples, the applicant should

have the expertise and resources to accomplish the stated objectives:

Salvaged specimens (i.e., those obtained from animals that

have died of natural causes; naturally shed hair; deposited scent gland

secretions) should be obtained without harassing any live animals, and

collection must be authorized by the MOF, MOC, or the Project Office or

the owner of the panda if not owned by China.

Any invasive sampling or sample collection involving

restraint of the animals should be done by qualified personnel (as

determined by the applicant), preferably veterinarians, with

appropriate training and experience in capture, restraint, and sample

collection, so as not to result in death or injury of animals.

Collection of samples, including semen specimens, that involve the use

of general anesthesia generally may be imported if collected by

individuals who possess appropriate expertise in anesthesia of giant

pandas so that risk to the animals is minimized, and in the case of

semen, persons collecting specimens should also possess appropriate

expertise in electro-ejaculation techniques for giant pandas. Invasive

sampling or sample collection involving restraint of wild pandas,

including semen collection, is limited generally to situations

resulting from capture activities conducted for another purpose

approved by MOF authorities and should not involve any type of

remuneration for the collection of the samples. Animals should not be

captured for the sole purpose of collecting samples.

The results of research conducted with imported specimens

must be reported to the Service at least annually; a report should

include copies of any scientific publications produced. The report

should contain information on the number and type (e.g., blood, hair,

skin biopsy) of samples imported, specific source/location from which

each sample was collected (if more than one was authorized), and brief

observations on the effects of sampling on the animals. The report

should also indicate whether the research resulted in the development

of protocols or other methodologies, if the products were transferred

to the Chinese government, and how they have been or will be used for

giant panda conservation.

Permits to import samples to monitor or determine

reproductive status or to import semen for use in captive breeding may

be issued. Imports of semen from China should be coordinated with

China's Captive Breeding Plan, the AZA Giant Panda SSP, or other

coordinated panda conservation plan approved by the Service. Imports of

semen from countries other than China must also be done in accordance

AZA's Giant Panda SSP (or other plan) but may not require specific

written approval from China.

The import or export of urine, feces, and synthetic DNA,

when collected in a manner that does not involve the capture,

detention, or killing of protected wildlife, does not require a permit

from the Service. The CITES Management Authority of any exporting or

importing country should be contacted to meet any requirements it may

have.

Captive Breeding

Any captive breeding conducted with imported pandas needs to

benefit panda conservation by supplementing the breeding program in

China to achieve a self-sustaining captive population (as outlined in

the MOC/CBSG Workshop report), and typically provide a source of funds

for panda conservation in the wild. There may be a need to maximize the

use of pandas currently held in captivity that are not essential to

China's Captive Breeding Plan. The Service expects that most of the

pandas made available for import into the United States will be ones

that have not successfully bred in China. Thus, at this time, the

Service finds that captive breeding for the sole purpose of producing

offspring is not sufficient to satisfy the enhancement requirement of

the ESA. This policy therefore stresses the need for any permit

applications

[[Page 45852]]

involving captive breeding to include a research component that will

benefit panda conservation.

1. If the applicant intends to conduct captive breeding of imported

pandas, in addition to the research requirements, the applicant should

provide sufficient information to demonstrate the necessity of

importing pandas for captive breeding:

Enhancement may be partially satisfied through captive

breeding if it can be convincingly shown that results will be used to

study and/or manage giant pandas in a way that contributes to panda

conservation. The application or request will be expected to include a

research component aimed at increasing reproductive success especially

if the animals involved have a history of being non-breeding animals.

It is expected that requests to import live giant pandas for captive

breeding will also include other enhancement activities, such as the

generation of funds for panda conservation in the wild.

The proposed captive breeding should be part of a

coordinated panda conservation effort designed to complement

conservation efforts for the wild panda population and the applicant

must actively participate in the AZA's Giant Panda SSP or a similar

plan approved by the Service.

The captive breeding program should coordinate with

China's Captive Breeding Plan and should demonstrate how it will

contribute to the preservation of the panda's gene pool (i.e.,

retention of maximum genetic diversity). The choice of individuals to

be imported should be based on scientific management of the captive

populations with genetic and demographic criteria used to determine

mating pairs.

Applications for panda movements should describe how the

study would contribute to the conservation of the giant panda in the

wild or in captivity, and how any information gained or methodologies

developed will be for use in China, including estimated time frames of

transfers, training, or collaborative efforts.

2. The applicant should provide information to show that he/she has

the expertise and resources to accomplish the stated objectives:

The applicant should submit a detailed breeding protocol

that outlines when male and females will be paired for breeding, how

females and males will be visually and physically separated and/or

managed together, with layout of facilities and protocols for rearing

potential young. In lieu of submitting the protocol, the applicant

could show they are using the protocol of the AZA Giant Panda SSP.

However, the Service will still request submission of facility and

exhibit information in the form of photographs, diagrams and written

description with each application.

Artificial insemination or any other physically invasive

procedures should be described, and any subsequent substantive

procedural changes and/or additions must be pre-approved by the

Service.

The permittee must provide quarterly updates and an annual

report summarizing breeding and research activities, including a copy

of protocols developed and methodologies used, a summary of data

collected with a discussion of results, and copies of any published

papers. The report should also indicate whether the activities resulted

in the development of protocols or other methodologies, if such

products were transferred to the Chinese government, and how they have

been or will be used for giant panda conservation.

3. If pandas are going to be on exhibition at any time during the

captive-breeding loan:

The applicant should provide protocols outlining how the

captive breeding, its research component, and exhibition will be

monitored to ensure that having the pandas on exhibit does not

interfere with captive breeding and/or its research component.

The applicant must have adequate facilities to conduct the

captive breeding and its research and provide information on

alternative facilities to house the pandas away from public exhibition

in case it is found that the exhibition interferes with the captive

breeding or research. The off-exhibit area should provide sufficient

space for exercise should pandas need to be housed there long term.

The applicant must consent to the movement, substitution,

or transfer of any panda to another approved institution if, in the

judgment and at the request of the Chinese government or the SSP Panda

Coordinator, such action is needed to maximize successful captive-

breeding opportunities.

Exhibition

1. The import of giant pandas for the sole purpose of educational

exhibition would not be sufficient to satisfy enhancement requirements.

The Service expects institutions importing giant pandas to educate the

U.S. public about the ecological role and conservation needs of the

giant panda, but will not consider this as an adequate justification

for issuing a permit. However, if an applicant is developing a panda

conservation education program that would be transferable to the

Chinese government, or is developing a program specifically for use in

China, particularly in localities near giant panda habitat and

reserves, the Service will consider this project as part of a

coordinated conservation effort in making its enhancement finding.

Educational programs in China should be aimed at local

people, school children, panda researchers (field and captive), reserve

biologists, and managers and should be in conjunction with the full

cooperation of the Chinese authorities.

Educational activities or projects should be described in

detail, including samples of the kinds of educational materials to be

used and a description of evaluation methods.

The messages conveyed through the educational program

should stress historical and contemporary impacts on the status of the

giant panda in the wild and conservation efforts that might be required

to halt the species' decline and degradation of its habitat.

2. Educational displays would only be allowed as an ancillary

component of a research or research/captive-breeding program. However,

if an applicant intends to exhibit the panda(s), educational display(s)

should be developed and implemented to educate the U.S. public about

the ecological role and conservation needs of the giant panda.

Specifically, the import of pandas solely for exhibition loans is

discouraged.

Primarily Commercial Purposes

With regard to the determination of whether an import of giant

pandas is not to be used for primarily commercial purposes, the Service

will utilize the following policy.

1. Resolution Conf. 5.10 of the Conference of Parties to CITES

provides that:

The nature of the transfer of specimens between the owner

in the country of export and the recipient in the country of import may

be commercial. It is the intended use of the specimens in the country

of import that must not be for primarily commercial purposes, and it is

the responsibility of the recipient country's Management Authority to

make this determination.

There may be some commercial aspects of that use, but the

non-commercial uses must predominate in order to be deemed primarily

non-commercial.

2. Any public, private, non-profit, or commercial (profit-making)

institutions, organizations, and agencies will receive consideration

for applications for the

[[Page 45853]]

importation of pandas. The Service's general regulations at 50 CFR

10.12 define ``public'' institutions as those that ``* * * are open to

the general public and are either established, maintained, and operated

as a government service, or are privately endowed and organized but not

operated for profit.'' Although commercial organizations may also

choose to apply for an import permit, the orientation of such

organizations to carry out transactions in the pursuit of gain or

profit would make it more difficult for the Service to find that the

specimen proposed for import is not to be used primarily for commercial

purposes. As in all cases, the burden rests with the applicant to show

that this CITES requirement is satisfied.

3. The Service's policy is that all net profits should be used for

panda conservation in China, with a significant portion of such funds

being used for in-situ conservation (see Enhancement and Conservation

Benefits of Specific Projects). Net profits include all funds or other

valuable considerations (including enhanced value of common stock

shares) received or attained by an institution or related organization

(including any commercial parent organization of the applicant, but not

including unrelated private entities, such as hotels, not associated

with the applicant) as a result of the panda import, to the extent that

such funds or other valuable considerations exceed the reasonable

expenses that are properly attributable to the proposed activities

(e.g., exhibition).

Reasonable expenses would include, but are not limited to,

the following: Facility construction if amortized for the entire

proposed length of stay for the imported animal(s); cost of the

importation agreement; facility maintenance; and direct labor and

operating expenses and supplies needed for the care of the pandas and

necessary to conduct research or research/captive-breeding activities

that have been identified in the application.

In making decisions on panda import permit applications,

the Service's goal would be to maximize funds going back to

conservation projects in China and, as such, costs associated with

ordinary operations, such as advertising, general personnel costs,

general legal expenses (not directly related to the panda import),

would not be considered reasonable expenses unless they can be shown to

be necessary to sustain the conservation purpose of the import.

Collection of revenues generated by import of the panda by

the importing institution (e.g., gate receipts, food and drink sales,

tourist souvenirs), either for its own use or for the use of other

organizations, for purposes other than those previously described

ordinarily would be judged to be a primarily commercial activity, as

would the use of revenues for profit-making purposes.

Monitoring of visitation and other means of tracking

monies earned as a result of panda activities should be employed by the

institution to assist in gathering data used to calculate net profits.

4. Each applicant for a panda import, in satisfying the applicable

requirements of 50 CFR subchapter B, must submit a detailed plan for

the allocation of all funds raised in excess of expenses (net profits),

as a result of the panda import. The application should also include a

statement from a licensed, independent certified public accountant

stating that the applicant's internal accounting system is sufficient

to account for and track funds generated directly by the panda import,

and for the subsequent disbursement of funds.

5. Each recipient of a permit to import pandas is required, in

accordance with 50 CFR 13.45, to submit an annual report to the Service

as a condition of the permit. The annual report must contain a full

accounting of all funds raised directly by the institution or related

organization, the reasonable expenses incurred and the portion of the

funds raised that is in excess of these expenses, and what portion of

these funds are to be disbursed for giant panda conservation projects

or activities as outlined in the prior section, Enhancement and

Conservation Benefits of Specific Projects. A description of the method

used to calculate net profits and categories of expenses and revenues

(including enhanced stock value, if applicable) must also be included

in the report.

The report should include names of people involved,

location of the activities, a brief description of each project and

assessment of project implementation, and the amount and use of money

being provided the project.

Conservation projects other than those projects presented

in the application must receive approval from the Service prior to

allocating funds.

If applicants wish to protect the specific dollar amounts

submitted in their annual report from disclosure under the Freedom of

Information Act, they should indicate this in the report along with a

reasonable justification to withhold confidential business information.

These policy considerations would be used by the Service only for

determining whether panda imports are primarily commercial in nature.

They are not intended to apply to Appendix-I import permit applications

for other species. All such applications must continue to demonstrate

that the proposed import meets the general requirements of CITES

Article III to satisfy the ``not to be used for primarily commercial

purposes'' test.

Suitability of Facilities and Care

Under CITES, the Service must be ``satisfied that the proposed

recipient of a living specimen (to be imported) is suitably equipped to

house and care for it.'' Under the regulations implementing the ESA,

the Service must determine that the applicant has ``* * * The

expertise, facilities, or other resources * * * to successfully

accomplish the objectives * * *'' To aid in satisfying these

requirements, applicants should provide the following information in

addition to the information required in 50 CFR 17.22:

Copies of protocols for monitoring general health and

behavior. In lieu of new protocols, an applicant may submit copies of

protocols recommended by a coordinated panda conservation effort,

including the AZA Giant Panda SSP.

Diagrams and photographs clearly depicting all enclosures

where the panda may be housed, including any off-exhibit areas and

panda holding area(s) in relation to other facilities.

Information to demonstrate the applicant has adequately

consulted with other facilities that have successfully held pandas in

recent years, that the applicant has facility features that address the

National Zoological Park's recommended measures for giant panda care

and facilities, and that zoo staff, especially keepers and

veterinarians, have had proper training and experience to care for

pandas.

Approval of facilities by the Chinese or appropriate

authority in the lending country, if such a stipulation has been made

in a contractual agreement.

Transfer of Pandas to Other Entities Within the United States

Transfer of pandas already in the United States may be allowed as

part of a scientific research or research/captive-breeding program but

should address all of the considerations noted in this policy. Pandas

may be displayed as long as it does not interfere with breeding or

research. The proposed recipient of the panda transferred between

states will need to apply for and receive an interstate commerce permit

under the ESA prior to the transfer since the recipient would

potentially gain

[[Page 45854]]

financially by having pandas at their facility and/or are being held

under a loan (e.g., lease-hold agreement) from China or other lending

entity. The proposed recipient of the panda will need to provide all

the information required by the ESA, its regulations, and this policy

in order for the Service to make its findings prior to issuance of a

permit. The Service will facilitate, to the extent possible, the

transfer of animals within the United States when it is part of a

coordinated research or research/breeding program. If the receiving

institution has a panda permit on file with the Service, it can

reference the permit number and information in this file, and provide

any new information for the Service to review in consideration of an

interstate commerce permit. Because applications will be published in

the Federal Register, the applicant will need to allow at least 90 days

for processing. Since transfers must also have the prior approval of

the Chinese government or the entity that owns the animals, a permittee

must have prior approval of the Service to transfer pandas within a

state, and the proposed recipient should address all of the

considerations noted in this policy. The number of times an individual

panda is transferred within the United States will be closely monitored

by the Service to protect the overall health and well-being of the

animal.

This notice was prepared under the authority of the Endangered

Species Act of 1973, as amended (16 U.S.C. 1531 et seq.).

Dated: June 22, 1998.

Jamie Rappaport Clark,

Director, U.S. Fish and Wildlife Service.

[FR Doc. 98-23074 Filed 8-26-98; 8:45 am]

BILLING CODE 4310-55-P