issue-1996-05-30•Federal Register final rules — 1996-05-30
Federal Register final rules — 1996-05-30
issue-1996-05-30Federal Register final rules — 1996-05-30Regulation
Published Federal Register documents, not public-inspection drafts. The GPO XML/text rendition is a research aid; the linked complete official PDF retains the printed layout and all graphics. Graphics are retained in that PDF and are not independently reproduced in this text rendition. Publication does not establish that every provision remains legally in force.
FR Doc. 96-13614 Fluid Milk Promotion Order; Amendments to the Order
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Page 27003]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13614]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
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Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / Rules
and Regulations
[[Page 27003]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1160
[DA-96-07]
Fluid Milk Promotion Order; Amendments to the Order
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule amends the Fluid Milk Promotion Order to modify the
term of the chairperson of the National Fluid Milk Processor Promotion
Board, effective July 1, 1996. The proposal was submitted by the
National Fluid Milk Processor Promotion Board which contends the action
is necessary to enable it to operate more effectively.
EFFECTIVE DATE: July 1, 1996.
FOR FURTHER INFORMATION CONTACT: Eugene E. Krueger, Head, Promotion and
Research Staff, USDA/AMS/Dairy Division, Room 2734, South Building,
P.O. Box 96456, Washington, DC 20090-6456, (202) 720-6909.
SUPPLEMENTARY INFORMATION: Prior document in this proceeding:
Invitation to Submit Comments on Proposed Amendment to the Order:
Issued May 2, 1996; published May 8, 1996 (61 FR 20759).
The Regulatory Flexibility Act (5 U.S.C. 601-612) requires the
Agency to examine the impact of a proposed rule on small entities.
Pursuant to 5 U.S.C. 605(b), the Agricultural Marketing Service has
certified that this rule will not have a significant economic impact on
a substantial number of small entities. The amendment modifies the term
of the chairperson of the National Fluid Milk Processor Promotion Board
and will not have an economic effect on any entity engaged in the dairy
industry.
The Department is issuing this final rule in conformance with
Executive Order 12866.
This final rule has been reviewed under Executive Order 12778,
Civil Justice Reform. This rule is not intended to have a retroactive
effect. This rule will not preempt any state or local laws,
regulations, or policies unless they present an irreconcilable conflict
with this rule.
The Fluid Milk Promotion Act of 1990, as amended, authorizes the
Fluid Milk Promotion Order. The Act provides that administrative
proceedings must be exhausted before parties may file suit in court.
Under section 1999K of the Act, any person subject to a Fluid Milk
Promotion Order may file with the Secretary a petition stating that the
order, any provision of the order, or any obligation imposed in
connection with the order is not in accordance with the law and request
a modification of the order or to be exempted from the order. A person
subject to an order is afforded the opportunity for a hearing on the
petition. After a hearing, the Secretary would rule on the petition.
The Act provides that the district court of the United States in any
district in which the person is an inhabitant, or has his principal
place of business, has jurisdiction to review the Secretary's ruling of
the petition, provided a complaint is filed not later than 20 days
after the date of the entry of the ruling.
In accordance with the Paperwork Reduction Act (44 U.S.C. Chapter
35), the forms and reporting and recordkeeping requirements that are
included in the Fluid Milk Promotion Order have been approved by the
Office of Management and Budget (OMB) and were assigned OMB No. 0581-
0093, except for Board members' nominee information sheets that were
assigned OMB No. 0505-0001.
Statement of Consideration
Section 1160.209(a) of the Fluid Milk Promotion Order currently
provides that the National Fluid Milk Processor Promotion Board meet at
least once a year and elect from among its members a chairperson to
serve a term of one year and not more than two consecutive terms. The
proposed amendment would modify, from one year to a fiscal period, the
term of the chairperson and provide that such chairperson may serve not
more than two consecutive fiscal periods.
Currently, a term of office for the chairperson of the National
Fluid Milk Processor Promotion Board is based on an annual period,
which expires on July 27, 1996, rather than a fiscal period. The Board
contends that the proposed amendment will provide continuity between
fiscal periods and the terms of office of the chairperson. The Board
indicates that this will allow the Board to operate more effectively.
Interested parties were provided an opportunity to submit comments
on the proposed amendment, published in the Federal Register at 61 FR
20759 on May 8, 1996; no comments were received.
Issuance of this final rule is necessary to provide continuity
between fiscal periods and the terms of office of the chairperson, and
to allow the Board to operate more effectively. Accordingly, the
proposed amendment to the order is made final in this action.
List of Subjects in 7 CFR Part 1160
Milk, Fluid milk products, Promotion.
For the reasons set forth in the preamble, the following provision
in Title 7, Part 1160, is amended as follows:
PART 1160--FLUID MILK PROMOTION ORDER
1. The authority citation for 7 CFR Part 1160 continues to read as
follows:
Authority: 7 U.S.C. 6401-6417.
2. Section 1160.209(a) is revised to read as follows:
Sec. 1160.209 Duties of the Board.
* * * * *
(a) To meet not less than annually, and to organize and select from
among its members a chairperson, who may serve for a term of a fiscal
period pursuant to Sec. 1160.113, and not more than two consecutive
terms, and to select such other officers as may be necessary;
* * * * *
Dated: May 24, 1996.
Shirley R. Watkins,
Deputy Assistant Secretary, Marketing and Regulatory Programs.
[FR Doc. 96-13614 Filed 5-29-96; 8:45 am]
BILLING CODE 3410-02-P
Complete official Federal Register PDF
FR Doc. 96-13555 Amendment of Class E Airspace; Ely, NV
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Page 27004]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13555]
[[Page 27004]]
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 71
[Airspace Docket No. 96-AWP-5]
Amendment of Class E Airspace; Ely, NV
AGENCY: Federal Aviation Administration (FAA), DOT
ACTION: Final rule.
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SUMMARY: This action amends the Class E airspace area at Ely, NV. The
establishment of a Global Positioning System (GPS) Standard Instrument
Approach Procedure (SIAP) to Runway (RWY) 18 has made this action
necessary. The intended effect of this action is to provide additional
controlled airspace for Instrument Flight Rules (IFR) operations at Ely
Airport (Yelland Field), Ely, NV.
EFFECTIVE DATE: 0901 UTC August 15, 1996.
FOR FURTHER INFORMATION CONTACT:
William Buck, Airspace Specialist, Operations Branch, AWP-530, Air
Traffic Division, Western-Pacific Region, Federal Aviation
Administration, 15000 Aviation Boulevard, Lawndale, California 90261,
telephone (310) 725-6556.
SUPPLEMENTARY INFORMATION:
History
On March 11, 1996, the FAA proposed to amend part 71 of the Federal
Aviation Regulations (14 CFR part 71) by amending the Class E airspace
area at Ely, NV (61 FR 9656). On April 8, 1996, the FAA issued a
supplemental notice to amend this proposal to establish a Class E
airspace area at Ely, NV (61 FR 15432).
Interested parties were invited to participate in this rulemaking
proceeding by submitting written comments on the proposals to the FAA.
No comments to the proposals were received. Class E airspace
designations are published in paragraph 6005 of FAA Order 7400.9C dated
August 17, 1995, and effective September 16, 1995, which is
incorporated by reference in 14 CFR 71.1. The Class E airspace
designation listed in this document will be published subsequently in
this Order.
The Rule
This amendment to part 71 of the Federal Aviation Regulations (14
CFR part 71) amends the Class E airspace area at Ely, NV. The
development of a GPS SIAP to RWY 18 has made this action necessary. The
intended effect of this action is to provide additional controlled
airspace for IFR operations at Ely Airport (Yelland Field), Ely, NV.
The FAA has determined that this regulation only involves an
established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current.
Therefore, this regulation--(1) is not a ``significant regulatory
action'' under Executive Order 12866; (2) is not a ``significant rule''
under DOT Regulatory Policies and Procedures (44 FR 10034; February 26,
1979); and (3) does not warrant preparation of a Regulatory Evaluation
as the anticipated impact is so minimal. Since this is a routine matter
that will only affect air traffic procedures and air navigation, it is
certified that this rule will not have a significant economic impact on
a substantial number of small entities under the criteria of the
Regulatory Flexibility Act.
List of Subjects in 14 CFR Part 71
Airspace, Incorporation by reference, Navigation (air).
Adoption of the Amendment
In consideration of the foregoing, the Federal Aviation
Administration amends 14 CFR part 71 as follows:
PART 71--[AMENDED]
1. The authority citation for 14 CFR part 71 continues to read as
follows:
Authority: 49 U.S.C. 106(g), 40103, 40113, 40120; E.O. 10854, 24
FR 9565, 3 CFR, 1959-1963 Comp., p. 389; 14 CFR 11.69.
Sec. 71.1 [Amended]
2. The incorporation by reference in 14 CFR 71.1 of the Federal
Aviation Administration Order 7400.9C, Airspace Designation and
Reporting Points, dated August 17, 1995, and effective September 16,
1995, is amended as follows:
Paragraph 6005 Class E airspace areas extending upward from 700
feet or more above the surface of the earth.
* * * * *
AWP NV E5 Ely, CA [Revised]
Ely VOR/DME
(Lat. 39 deg.17'53'' N, long. 114 deg.50'54'' W)
That airspace extending upward from 700 feet above the surface
within a 4.3-mile radius of Ely VOR and within 4.3-miles northeast
and 8.3 miles southwest of the Ely VOR 303 deg. radial, extending
from the Ely VOR to 16.1 miles northwest and within 3 miles each
side of the Ely VOR 014 deg. radial, extending from the Ely VOR to
12.6 miles northeast and within 3 miles each side of the Ely VOR
167 deg. radial, extending from the Ely VOR to 7.7 miles south of
the Ely VOR. That airspace extending upward from 1,200 feet above
the surface within 19.1-mile radius of Ely VOR and within 6.1 miles
northeast and 8.7 miles southwest of the Ely VOR 335 deg. radial,
extending from the 19.1-mile radius to 33 miles northwest of the Ely
VOR and within 4.3 miles east and 6.5 miles west of the Ely VOR
014 deg. radial, extending from the 19.1-mile radius to 21.3 miles
north of the Ely VOR and within 14 miles east and 12.5 west of the
Ely VOR 169 deg. radial, extending from the 19.1-mile radius to 53
miles south of the Ely VOR.
* * * * *
Issued in Los Angeles, California, on May 17, 1996.
Thomas S. Kamman,
Acting Manager, Air Traffic Division, Western-Pacific Region.
[FR Doc. 96-13555 Filed 5-29-96; 8:45 am]
BILLING CODE 4910-13-M
Complete official Federal Register PDF
FR Doc. 96-13537 Change of Names and Addresses; Technical Amendment; Correction
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27004-27005]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13537]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
21 CFR Parts 172, 173, 175, 176, 177, 178, 180, 181, and 189
Change of Names and Addresses; Technical Amendment; Correction
AGENCY: Food and Drug Administration, HHS.
ACTION: Technical amendment; correction.
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SUMMARY: The Food and Drug Administration (FDA) is correcting a
technical amendment that appeared in the Federal Register of April 2,
1996 (61 FR 14481). The document amended the regulations in 21 CFR
parts 172, 173, 175, 176, 177, 178, 180, 181, and 189 to reflect a
change in the name and mailing address for the Association of Official
Analytical Chemists International. The document was published with some
errors. This document corrects those errors.
DATES: Effective April 1, 1996.
FOR FURTHER INFORMATION CONTACT: LaJuana D. Caldwell, Office of Policy
(HF-27), Food and Drug Administration, 5600 Fishers Lane, Rockville, MD
20857, 301-443-2994.
SUPPLEMENTARY INFORMATION: In FR doc. 96-7919, appearing on p.14481, in
the Federal Register of Tuesday, April 2, 1996, the following
correction is made:
Secs. 172, 173, 175, 176, 177, 178, 180, 181, and 189 [Corrected]
On page 14482, in the 1st column, under the ``Supplementary
Information'' caption, beginning in line 12, the name and mailing
address for the Association of Official Analytical Chemists
International is corrected to read: ``AOAC INTERNATIONAL, 481 North
Frederick, suite 500, Gaithersburg, MD 20877-2417''.
[[Page 27005]]
Dated: May 22, 1996.
William K. Hubbard,
Associate Commissioner for Policy Coordination.
[FR Doc. 96-13537 Filed 5-29-96; 8:45 am]
BILLING CODE 4160-01-F
Complete official Federal Register PDF
FR Doc. 96-13527 Federal Motor Vehicle Safety Standards; Head Restraints
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27023-27025]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13527]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 571
[Docket No. 95-84; Notice 02]
RIN 2127-AF70
Federal Motor Vehicle Safety Standards; Head Restraints
AGENCY: National Highway Traffic Safety Administration (NHTSA), DOT.
ACTION: Final rule.
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SUMMARY: This final rule clarifies the test procedures in Standard No.
202, ``Head Restraints,'' by replacing the phrase ``rearmost portion of
the head form'' with a reference to the portion of the head form in
contact with the head restraint. The proposal on which this rule is
based contained two other proposed amendments to the standard; this
document terminates rulemaking on those proposals.
DATES: Effective Date: The amendments made in this rule are effective
July 15, 1996.
PETITION DATES: Any petitions for reconsideration must be received by
NHTSA no later than July 15, 1996.
ADDRESSES: Any petitions for reconsideration should refer to the docket
and notice number of this notice and be submitted to: Administrator,
National Highway Traffic Safety Administration, 400 Seventh Street, SW,
Washington, DC 20590.
FOR FURTHER INFORMATION CONTACT: The following persons at the National
Highway Traffic Safety Administration, 400 Seventh Street, SW,
Washington, DC 20590:
For non-legal issues: Clarke Harper, Frontal Crash Protection
Division, Office of Vehicle Safety Standards, NPS-12, telephone (202)
366-4916, fax (202) 366-4329, electronic mail
``[email protected]''.
For legal issues: Steve Wood, Office of the Chief Counsel, NCC-20,
telephone (202) 366-2992, facsimile (202) 366-3820, electronic mail
``[email protected]''.
SUPPLEMENTARY INFORMATION: Pursuant to the March 4, 1994 directive,
``Regulatory Reinvention Initiative,'' from the President to the heads
of departments and agencies, NHTSA has undertaken a review of all its
regulations and directives. During the course of this review, the
agency identified several requirements and regulations that are
potential candidates for amendment or rescission. Some of these
provisions were found in Federal Motor Vehicle Safety Standard No. 202,
``Head Restraints.''
On October 24, 1995, NHTSA published a notice of proposed
rulemaking (NPRM), proposing to delete one of two alternative
performance requirements for head restraints. The NPRM also proposed to
clarify the test procedures by replacing the phrase ``rearmost portion
of the head form'' with a reference to the portion of the head form in
contact with the head restraint. Last, the NPRM proposed to specify
that head restraints on bench-type seats are loaded simultaneously
during compliance testing.
The agency received eight comments in response to this NPRM. As
explained below, after reviewing these comments the agency has decided
to amend Standard No. 202 to replace the phrase ``rearmost portion of
the head form'' with a reference to the portion of the head form in
contact with the head restraint. However, the agency is terminating
rulemaking on the other proposed amendments.
[[Page 27024]]
Dynamic Test Requirement
Standard No. 202 allows manufacturers a choice of two performance
requirements which provide equivalent levels of safety. One
alternative, found in S4.3(b) and S5.2, requires the head restraint to
have minimum dimensions and to not displace more than 4 inches when a
3,300 inch pound moment is applied to the head restraint. The other
alternative, found in S4.3(a) and S5.1, limits rearward angular
displacement of the dummy head to less than 45 degrees during a forward
acceleration of at least 8g applied to the seat supporting structure.
The second alternative involves a testing procedure that is more
cumbersome than the first alternative and subsequently has rarely, if
ever, been used. Because this alternative has rarely been used, NHTSA
proposed to remove this alternative to simplify the regulatory language
of the standard.
AAMA and Volkswagen supported this proposal; however, other
commenters did not agree. Some commenters stated that Standard No. 202
should be amended by strengthening the dynamic test rather than
removing it. Other commenters stated that manufacturers should be
allowed this alternate test, and that the dynamic test more closely
depicted the real world.
Atwood Mobile Products and the Recreation Vehicle Industry
Association stated that removal of the dynamic test could stifle future
technological innovation in the area of deployable crash protections
systems for head restraints. The Insurance Institute for Highway Safety
agreed, stating that development of such systems would be impeded by a
standard that only specifies geometric requirements.
Based on these comments, NHTSA has decided to terminate rulemaking
on the proposal to rescind the dynamic test alternative in Standard No.
202. NHTSA is concerned that removal of this alternative could stifle
technological improvements in this area. In addition, it was not the
intention of the proposal to restrict the choice of options available
to manufacturers.
``Rearmost Portion of the Head Form''
Paragraph S4.3(b)(3) of Standard No. 202 states that a head
restraint installed under option (b) of the standard must limit the
rearward displacement of ``the rearmost portion'' of the head form used
to apply a test load to the restraint. During agency compliance
testing, questions have occasionally arisen regarding what is meant by
the phrase ``rearmost portion of the head form'' in S4.3(b)(3).
Therefore, the agency proposed to clarify the standard by replacing the
reference to the phrase ``rearmost portion of the head form'' with a
reference to the portion of the head form in contact with the head
restraint.
Three commenters addressed this issue. Two supported the proposal
and only one commenter (Liability Research Group (LRG)) objected to it.
LRG believed that the proposed change would allow head form contact
below the level of the mid-line of the head form and lead to poor head
restraint designs. LRG provided no explanation of how the wording
change would be detrimental to safety.
The wording change merely clarifies the location on the head form
which is subject to the requirement. Therefore, the change will have no
effect on safety and will not allow designs not already allowed by the
standard. Therefore, NHTSA is adopting the proposed amendment.
Test Consolidation for Bench Seats
To reduce compliance testing costs, the agency proposed to specify
that head restraints on bench-type seats would be loaded simultaneously
during testing. On front bench seats, this proposal would have required
the driver's and right passenger's head restraints to be tested in a
single test instead of in two separate tests. Under the current test
procedure, a load that will produce a 3,300 inch pound moment is
applied to the head restraint. That load is then increased until either
a 200 pound load is applied or the seat back fails. NHTSA tentatively
concluded that manufacturers could experience minor cost savings as a
result of running one test of both head restraints simultaneously,
rather than two separate tests.
In the NPRM, the agency recognized that the proposal might
theoretically allow manufacturers to install less strong head
restraints. If simultaneous loads were to cause the seat back to fail
before the 200 pound load were applied, the test would be considered
incomplete, rather than a failure. The agency would not have been able
to fully evaluate compliance of the vehicle with Standard No. 202.
However, NHTSA did not believe that testing head restraints
simultaneously would result in a seat back failure. This is because
NHTSA has never had a seat back fail during its compliance testing for
Standard No. 202, and because the total load would be less than seats
are required to withstand under Standard No. 207, Seating Systems.
Therefore, the agency did not expect this proposal to result in a
lessening of the safety requirements of the standard.
No commenter supported this proposal. Commenters expressed concern
that the proposal could allow manufacturers to install weaker seats
rather than strong head restraints. The commenters stated that there
was no data to support the agency's belief that the proposal would not
result in a reduction in safety.
Commenters also stated that the savings to manufacturers would not
result. Commenters stated that the test setup would not be noticeably
different for a test of two head restraints in comparison to two single
tests. Commenters also stated that manufacturers would incur initial
costs to upgrade laboratory equipment to conduct simultaneous tests.
Based on these comments, NHTSA is terminating rulemaking on this
proposal. The intent of the proposal was to (a) reduce compliance test
costs (b) without a reduction in safety. Commenters provided
information that the first of these goals was not likely to be met. In
addition, commenters raised doubts that the second goal would be met
also.
Rulemaking Analyses and Notices
Executive Order 12866 and DOT Regulatory Policies and Procedures
NHTSA has considered the impact of this rulemaking action under
E.O. 12866 and the Department of Transportation's regulatory policies
and procedures. This rulemaking document was not reviewed under E.O.
12866, ``Regulatory Planning and Review.'' This action has been
determined to be not ``significant'' under the Department of
Transportation's regulatory policies and procedures. This rule merely
clarifies a phrase in the test procedure, and does not change the
regulatory requirements of the standard. Therefore, there should be no
economic impact from this rule.
Regulatory Flexibility Act
NHTSA has also considered the impacts of this final rule under the
Regulatory Flexibility Act. I hereby certify that this rule will not
have a significant economic impact on a substantial number of small
entities. As explained above, the agency expects no economic impact
from this rule.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1980 (P.L. 96-
511), there are no requirements for information collection associated
with this final rule.
[[Page 27025]]
National Environmental Policy Act
NHTSA has also analyzed this final rule under the National
Environmental Policy Act and determined that it will not have a
significant impact on the human environment.
Executive Order 12612 (Federalism)
NHTSA has analyzed this rule in accordance with the principles and
criteria contained in E.O. 12612, and has determined that this rule
will not have significant federalism implications to warrant the
preparation of a Federalism Assessment.
Civil Justice Reform
This final rule does not have any retroactive effect. Under 49
U.S.C. 30103, whenever a Federal motor vehicle safety standard is in
effect, a State may not adopt or maintain a safety standard applicable
to the same aspect of performance which is not identical to the Federal
standard, except to the extent that the State requirement imposes a
higher level of performance and applies only to vehicles procured for
the State's use. 49 U.S.C. 30161 sets forth a procedure for judicial
review of final rules establishing, amending or revoking Federal motor
vehicle safety standards. That section does not require submission of a
petition for reconsideration or other administrative proceedings before
parties may file suit in court.
List of Subjects in 49 CFR Part 571
Imports, Motor vehicle safety, Motor vehicles.
In consideration of the foregoing, 49 CFR Part 571 is amended as
follows:
PART 571--FEDERAL MOTOR VEHICLE SAFETY STANDARDS
1. The authority citation for Part 571 of Title 49 continues to
read as follows:
Authority: 49 U.S.C. 322, 30111, 30115, 30117, and 30166;
delegation of authority at 49 CFR 1.50.
2. Section 571.202 is amended by revising section S4.3(b)(3) to
read as follows:
Sec. 571.202 Standard No. 202; Head restraints.
* * * * *
S4.3
* * * * *
(b)
* * * * *
(3) When tested in accordance with S5.2, any portion of the head
form in contact with the head restraint shall not be displaced to more
than 4 inches perpendicularly rearward of the displaced extended torso
reference line during the application of the load specified in S5.2(c);
and
* * * * *
Issued on May 22, 1996.
Ricardo Martinez,
Administrator.
[FR Doc. 96-13527 Filed 5-29-96; 8:45 am]
BILLING CODE 4910-59-P
Complete official Federal Register PDF
FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27178-27222]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13524]
[[Page 27177]]
_______________________________________________________________________
Part V
Federal Trade Commission
_______________________________________________________________________
16 CFR Parts 19 and 23
Guides for the Metallic Watch Band Industry and the Jewelry Industry,
Final Rules; and Guides for the Jewelry, Precious Metals, and Pewter
Industries, Proposed Rule
Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / Rules
and Regulations
[[Page 27178]]
FEDERAL TRADE COMMISSION
16 CFR Part 23
Guides for the Metallic Watch Band Industry and Guides for the
Jewelry Industry
AGENCY: Federal Trade Commission.
ACTION: Final guides.
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SUMMARY: The Federal Trade Commission (``Commission'') announces that
it has concluded a review of its Guides for the Metallic Watch Band
Industry (``Watch Band Guides'') and Guides for the Jewelry Industry
(``Jewelry Guides''). The Commission rescinds the Watch Band Guides in
a document published elsewhere in this issue of the Federal Register.
The Commission is consolidating certain provisions of the Watch Band
Guides with the Jewelry Guides. The Commission is renaming the Guides
for the Jewelry Industry the Guides for the Jewelry, Precious Metals
and Pewter Industries. The Commission also revises the Jewelry Guides
by defining the scope and application of the Guides and adding new
provisions regarding the use of the terms ``vermeil'' and ``pewter.''
The Commission is also making substantive changes to the existing
provisions of the Jewelry Guides, as discussed in detail herein. The
Commission is not making any changes to the provisions regarding the
use of the word ``platinum'' at this time and will request additional
comment on possible revisions to this section in a separate Federal
Register notice.
EFFECTIVE DATE: May 30, 1996.
ADDRESSES: Requests for copies of this document should be sent to the
Public Reference Branch, Room 130, Federal Trade Commission,
Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT: Constance M. Vecellio, Attorney, 202-
326-2966, or Laura J. DeMartino, Attorney, 202-326-3030, Division of
Enforcement, Federal Trade Commission, Washington, DC 20580.
SUPPLEMENTARY INFORMATION:
I. Introduction
The Commission revises the Guides for the Jewelry Industry and the
Guides for the Metallic Watch Band Industry (``Guides''), 16 CFR Parts
23 and 19, respectively, as described in detail below. The Commission
will announce the results of its review of the Guides for the Watch
Industry, 16 CFR Part 245, which was conducted at the same time as the
review of the other Guides, in a separate notice. The Commission
published a Federal Register Notice (``FRN'') soliciting public comment
on amendments to the Guides on June 12, 1992, in response to a petition
from the Jewelers Vigilance Committee, Inc. (``JVC'').\1\ The comment
period, as extended, ended on September 25, 1992.\2\
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\1\ 57 FR 24996 (June 12, 1992). The JVC, located at 401 East
34th Street, NY, NY 10016, is a trade association that was formed in
1912 to promote ethical practices in the jewelry industry. Its
initial petition is dated April 15, 1986; additional proposed
revisions were submitted on February 20, 1989.
\2\ 57 FR 34532 (Aug. 5, 1992).
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The FRN solicited comment on the JVC's proposal to revise the
Guides.\3\ The FRN summarized the major amendments proposed by the JVC,
as well as revisions that Commission staff was proposing. In addition
to requesting comment on the proposed revisions generally, the FRN
asked for comment on 34 questions.
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\3\ Because of its 71-page length, the JVC proposal was not
published. But, the proposal, and a document showing how the current
Guides would be changed by the JVC proposal, was placed on the
public record for inspection and is available in the Public
Reference Room of the Commission.
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The Commission received 263 comments. In the remainder of this
notice, the comments are cited to by an abbreviation of the commenter's
name and the document number assigned to the comment on the public
record. A list of the commenters, including the abbreviations and
document numbers used to identify each commenter, is attached as an
Appendix.\4\
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\4\ In summary, the comments are from 19 trade associations, 85
diamond dealers, 53 colored stone dealers, 37 retail jewelers, 10
synthetic gemstone manufacturers, 12 pewter manufacturers, 10 watch
manufacturers, 9 general manufacturers, 5 gemologist/appraisers, 7
precious metals firms, 3 catalog houses, 2 manufacturer
representatives, 2 writing implement manufacturers, 3 pearl dealers,
and one each from: The Canadian Government, the U.S. Postal Service,
the National Association of Consumer Agency Administrators, a
scientist who works with laser technology and crystal growth, an
economics professor, an importer, a retired trade association
executive, and an editor of Jewelers Circular-Keystone, and a trade
magazine.
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The revisions are discussed section-by-section by category.\5\
Below, Part II addresses the standard regulatory review questions that
were included in the FRN. Part III discusses general issues regarding
the proposed revisions to the Guides. Part IV analyzes the proposed
revisions to the Jewelry Guides section-by-section (including the Watch
Band Guides, now consolidated with the Jewelry Guides).
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\5\ Various sections of the Guides that pertain to particular
subject areas are referred to as ``categories,'' in the Appendix to
the current Guides, i.e., Category I: Jewelry industry products in
general; Category II: precious metals; Category III: diamonds,
genuine and imitation; Category IV: pearls, genuine, cultured and
imitation; Category V: gemstones, genuine, synthetic and imitation.
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II. Regulatory Review and Related Questions
As part of the Commission's ongoing program to review all of its
rules and guides periodically, the FRN included questions about the
Guides' economic impact and continuing relevance, any compliance
burdens, changes needed to minimize their economic impact, their
relation to other federal or state laws or regulations, and the effect
of any changed conditions since the Guides were issued. The Commission
also solicited comment on general issues regarding the Guides, such as
whether the JVC's proposed provisions accurately reflect accepted
practices, technology or nomenclature used in the trade; whether
proposed changes would result in a lessening of competition or
increased prices; and whether the JVC's petition to revise should be
rejected and the current Guides retained. Because these questions
concern fundamental issues about whether the Guides should be retained,
deleted or revised, the Commission addresses them first.
A. Summary of the Comments
All but one of the 37 comments specifically addressing the economic
impact of the Guides stated that any compliance costs are far
outweighed by the benefits to the industry and to consumers.\6\ None of
the comments provided any figures or estimates of the monetary costs
incurred in complying with the Guides.
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\6\ E.g., Fasnacht (4) p.1 (the Guides have a positive economic
impact by creating a level playing field); Schwartz (52) (the Guides
have a positive impact on the industry by establishing standards
that offer consumers protection without undue cost); JMC (1); Thorpe
(7); King (11); Gold Institute (13); Honora (15); Argo (17); AGS
(18); AGTA (49); Estate (23); G&B (30); Jabel (47); Skalet (61);
Handy (62); Lannyte (65); Newhouse (76); GIA (81); Nowlin (109);
McGee (112); ArtCarved (155); Bales (156); Bridge (163); LaPrad
(181); IJA (192); CPAA (193); Mark (207); Canada (209); Bedford
(210); JVC (212); Matthey (213); Bruce (218); Service (222); MJSA
(226); Preston (229); Timex (239); and Sheaffer (249).
Service (222) agreed with regard to the current Guides, but
thought that the compliance costs associated with the proposed
revisions outweighed the benefits.
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Thirty-eight comments specifically addressed the continuing need
for the Guides and all agreed that there is a continuing need, with
most stating that the Guides protect consumers and industry.\7\ One
comment stated,
[[Page 27179]]
``Without the guides to serve as a reference manual, every manufacturer
or producer would have their own interpretation [of what constitutes
fair industry practices].'' \8\
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\7\ The commenters are the same as in footnote 6 supra, with the
addition of Eisen (91). With regard to the current Guides, Best
(225) stated, at p.2, that the Guides ``are well developed and
provide protection to consumers and to reputable jewelers against
otherwise false and deceptive practices. The Guides offer a great
measure of certainty to jewelers' business practices as historical
application and interpretation have better defined the parameters of
acceptable conduct. This certainty has value because it contributes
to an efficient and free flow of information to consumers in the
marketplace.'' AGTA (49), at p.2, stated: ``If consumers cannot be
confident that what they are paying for is what they have been told
it is, our trade cannot survive. The FTC guides provide a structure
upon which our industry has built regulations for the consumer's
protection, which is ultimately our own as a trade. Therefore, AGTA
endorses their continued existence, timely revision, and a strong
enforcement.''
\8\ Skalet (61) p.1.
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Twenty-nine comments specifically addressed the burdens of
complying with the Guides. Seven comments stated there are no
compliance burdens.\9\ Three also stated that, if everyone complies,
the burdens of compliance are evenly distributed and will not benefit
one business at the expense of another.\10\ Ten comments stated that
the burdens are minimal \11\ and six thought the burdens were ``worth
it.'' \12\ The seven comments that itemized the burdens (``testing and
planning,'' ``monitoring suppliers,'' ``controls,'' ``measurements,''
``record keeping,'' ``time,'' and ``personnel''), concluded that the
costs are acceptable because of the benefits received.\13\ None of the
comments identified the extent of the costs in money or in time.
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\9\ Fasnacht (4); Honora (15); G&B (30); Lannyte (65); Newhouse
(76); CPAA (193); and Bedford (210).
\10\ Honora (15); G&B (30); and Newhouse (76).
\11\ JMC (1); King (11); AGS (18); Estate (23); Schwartz (52);
Handy (62); Nowlin (109); Bridge (163); MJSA (226); and Preston
(229).
\12\ Argo (17); AGTA (49); Bales (156); LaPrad (181); Mark
(207); and Matthey (213).
\13\ Jabel (47); Skalet (61); McGee (112); ArtCarved (155); IJA
(192); Canada (209); and MJSA (226).
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Although 29 comments responded to the question regarding changes
needed to minimize the economic effect of the Guides, they did not
offer detailed explanations or suggestions. Fifteen comments stated
that no changes are necessary.14 Six comments stated that the
changes proposed by the JVC are sufficient to minimize their economic
effects.15 Two comments recommended simplifying the Guides to
avoid misunderstandings (e.g., about the proper use of
terminology).16 Canada stated that harmonizing standards with
Canada would minimize the economic effect on entities subject to the
Guides' requirements, reduce costs and promote international trade, by
not requiring manufacturers to mark products for domestic use
differently than those made for foreign use.17
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\14\ JMC (1); Fasnacht (4); Thorpe (7); Honora (15); Argo (17);
Estate (23); G&B (30); Jabel (47); Schwartz (52); Skalet (61); Handy
(62); McGee (112); LaPrad (181); IJA (192); and Mark (207).
\15\ AGTA (49); GIA (81); Bridge (163); Bedford (210); JVC
(212); and Preston (229).
\16\ ArtCarved (155) and Matthey (213).
\17\ Comment 209, p.1.
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Twenty-seven comments addressed the relation of the Guides to
federal, state or local laws or regulations. Twenty-one comments
specifically stated either that there is no conflict or overlapping or
that they are unaware of any.18 Six stated that if there was any
duplication, it should not deter the Commission from approving
comprehensive guidelines.19 (No examples of duplication were
provided.) However, the Postal Service stated that the Guides ``overlap
with Postal authority, sometimes undermining our position in false
representation and fraud actions.'' 20 The Postal Service stated
that the Guides do not adequately address the situation where the
consumer purchases jewelry before actually seeing it. The Postal
Service proposed changes to the Guides to help remedy this
problem.21 As discussed below, the Commission has revised the
Guides to mitigate this problem.
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\18\ JMC (1); Fasnacht (4); Thorpe (7); King (11); Honora (15);
Argo (17); Handy (62); Lannyte (65); GIA (81); NACAA (90); McGee
(112); ArtCarved (155); Bridge (163); IJA (192); Phillips (204);
Bedford (210); JVC (212); Matthey (213); Best (225); MJSA (226); and
Preston (229).
\19\ Estate (23); G&B (30); Jabel (47); AGTA (49); LaPrad (181);
and CPAA (193).
\20\ Comment 244, p.1. The Postal Service enforces 39 U.S.C.
3005, which prohibits persons from obtaining mail or property
through the mail by means of false representation. The Postal
Service also brings actions under the criminal mail and wire fraud
statutes, 18 U.S.C. 1341, 1342 & 1345. Id.
\21\ Comment 244, pp.1-3.
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Thirty-one comments discussed economic or technological changes
since the Guides were issued and the effect on the Guides. Three
comments 22 stated that economic and technological changes have
had no effect on the Guides and 28 comments stated that such changes
have had an effect on the Guides.23 The changes the commenters
specified, which they thought should be reflected in the Guides, are
new gemstone enhancement techniques,24 laser treatment of
diamonds,25 fracture-filling of diamonds,26 new methods of
metal plating,27 diffusion-treated sapphires,28 advanced
testing techniques,29 new synthetic gemstones,30 and possible
new platinum products.31
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\22\ JMC (1); Handy (62); and McGee (112).
\23\ JMC (1); Fasnacht (4); Thorpe (7); King (11); Honora (15);
Argo (17); AGS (18); Estate (23); AGTA (49); Lannyte (65); Newhouse
(76); GIA (81); Eisen (91); McGee (112); ArtCarved (155); Bales
(156); Bridge (163); LaPrad (181); IJA (192); CPAA (193); Mark
(207); Canada (209); Bedford (210); Matthey (213); MJSA (226);
Preston (229); Timex (239); and Sheaffer (249).
\24\ AGS (18); AGTA (49); GIA (81); Eisen (91); ArtCarved (155);
LaPrad (181); and IJA (192).
\25\ Fasnacht (4); Thorpe (7); Honora (15); ArtCarved (155); and
Preston (229).
\26\ Thorpe (7); Estate (23); ArtCarved (155); IJA (192); and
Preston (229).
\27\ Newhouse (76); ArtCarved (155); Canada (209); and Preston
(229).
\28\ Thorpe (7); Honora (15); and Preston (229).
\29\ ArtCarved (155); LaPrad (181); and Preston (229).
\30\ Honora (15) and ArtCarved (155).
\31\ ArtCarved (155).
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On the economic side, Richard C. Mark commented on the dramatic
increase in the price of gold since the Guides were most recently
revised, which, he stated, increases the significance of any rules
dealing with gold.32 Another comment stated that greater economic
advantage to the trade would occur if national and international
standards are uniform.33
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\32\ Comment 207, p.2. In 1957, when the Guides were last
revised, gold cost $35 an ounce. The current price fluctuates
between $350 and $400 per ounce.
\33\ Matthey (213) p.1 (stating that ``Competition on a global
as well as a national basis make the establishment of standards and
clear definitions of terminology even more critical'').
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Twenty-four comments addressed whether proposed provisions
accurately reflect accepted practices, technology or nomenclature used
in the trade. Fourteen comments stated that there are no requirements
in the JVC proposal that do not fairly and accurately reflect trade
practices.34 Some comments, however, identified parts of the
proposed Guides that they contended are contrary to accepted industry
practices. Specifically, Best and Service Merchandise stated that the
JVC's proposed diamond weight tolerances, restrictions on the use of
the term ``point,'' and proposed disclosures regarding gemstone
enhancement do not conform with accepted trade practices.35 Other
responses to this question were not directly responsive because they
did not contend the JVC's proposals were out of step with current trade
practices, but instead proposed adding new terms and standards to the
Guides.36
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\34\ JMC (1); Fasnacht (4); Argo (17); Capital (19); Estate
(23); Jabel (47); Skalet (61); Handy (62); Newhouse (76); GIA (81);
McGee (112); ArtCarved (155); IJA (192); and Bedford (210).
\35\ Best (225) p.4 and pp.7-8 and Service (222) p.1 and 5 of
letter and p.3 of comment. See also MJSA (226) p.7 (opposing
proposed diamond weight tolerances as contrary to industry
practice).
\36\ For example, AGTA (49) suggested banning certain terms in
use that relate to synthetic gemstones and plated gold jewelry. See
also Lannyte (65); Eisen (91); CPAA (193); and Matthey (213). (Their
proposals are discussed under the appropriate categories infra.)
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Thirty-one comments directly responded to the question regarding
[[Page 27180]]
whether any proposed changes to the Guides would result in a lessening
of competition, barriers to entering the industry or increased prices
to consumers. Twenty-five answered ``no'' or ``probably not.'' 37
But, numerous comments regarding the JVC's proposed weight tolerances
for diamonds believed a narrow tolerance requirement (as the JVC
proposed) would increase costs to consumers.38 Jabel stated that
paperwork and the printing of definitions and descriptions the JVC
proposed as new requirements may increase consumer prices.39
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\37\ JMC (1); Fasnacht (4); Sibbing (5); Thorpe (7); King (11);
Honora (15); Argo (17); AGS (18); Estate (23); G&B (30); AGTA (49);
Schwartz (52); Skalet (61); Handy (62); Lannyte (65); GIA (81);
Nowlin (109); McGee (112); ArtCarved (155); IJA (192); CPAA (193);
Mark (207); Canada (209); Bedford (210); and Matthey (213). In
addition, most of the 72 comments supporting a different tolerance
for diamond weights indicated that requiring the merchant to state
more accurately the weight or weights of diamonds would result in
increased costs to consumers.
\38\ E.g., Service (222) and Best (225) (implementation of the
JVC proposal would result in lessened competition and higher prices,
particularly for low margin jewelry retailers, which would be passed
on to consumers). The comments opposing the proposed diamond weight
tolerance and alleging consequential costs are listed and examined
in detail in the discussion of diamonds below.
\39\ Comment 47, p.2.
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Preston commented that, although he was not specifically aware of
any proposals that would lessen competition, produce barriers to entry
or increase prices to consumers, he thought these results could occur
on a modest scale.40 Thorpe stated, on the other hand, but without
giving any reasons, that the JVC proposal would increase competition
based on quality, value and service, and that the proposal would lower
prices to consumers by allowing them to shop and compare ``on a level
playing field.'' 41 Bales recommended that the Guides allow
products of less than 10 karat gold to be sold as a karat gold product
because it would increase competition in the industry.42 Other
comments, while not specifically responding to this question, stated
that the JVC's proposal to prohibit the use of the term ``gemstone'' to
describe synthetic or imitation products would be
anticompetitive.43
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\40\ Comment 229.
\41\ Comment 7, p.2.
\42\ Bales (156) suggested that a quality mark be permitted on a
product called Balesium that is 4\1/2\ karat gold. See discussion
below regarding the 10 karat minimum standard for karat gold.
\43\ Service (222) p.1 and p.4; Best (225) p.3; AGL (230) p.3;
NRF (238) pp.1-2; Kyocera (242) p.1; River (254) p.1. Dealers in
synthetics, which are materials made in a laboratory that have the
same chemical, physical and optical properties as a natural
gemstone, contend they should be able to describe their products as
gemstones with appropriate qualification to indicate that they are
laboratory made.
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One hundred eighty-one comments responded to the question of
whether the JVC's petition to revise should be rejected and the current
Guides retained. Many comments stated that the petition to revise
should not be rejected.44 For example, AGTA affirmatively favored
revising the Guides and 56 AGTA members filed individual comments
endorsing the AGTA position. Twenty three other comments did not
respond specifically to Question 34, but endorsed revision of the
Guides.45
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\44\ E.g., JMC (1); Fasnacht (4); Thorpe (7); King (11); Gold
Institute (13); Argo (17); AGS (18); Capital (19); Estate (23); G&B
(30); Jabel (47); AGTA (49); Schwartz (52); Skalet (61); Handy (62);
GIA (81); Nowlin (105); McGee (112); ArtCarved (155); Bales (156);
LaPrad (181); IJA (192); CPAA (193); Mark (207); Canada (209);
Bedford (210); Matthey (213); and Preston (229).
\45\ JMC (1); Littman (2); JA (3); Overstreet (8); Kennedy (9);
Collins (12); Von's (16); Jeffery (21); Stanley (83); General (88);
APG (89); NACAA (90); Eisen (91); Alie (106); AWI (116); USWC (118);
Krementz (208); JVC (212); WGC (223); MJSA (226); Swiss Federation
(232); AWA (236); and ISA (237A).
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Service Merchandise and Best recommended rejecting the petition to
revise in favor of retaining the current Guides.46 Service
Merchandise stated that the proposed revisions are anti-competitive and
offer insufficient benefit to the affected industries or their
consumers to justify the additional efforts and costs that they allege
will result.47 Additionally, 72 comments recommended rejecting the
JVC proposal and retaining the current Guides, apparently because of
their objection to the JVC's proposal regarding diamond weight
tolerances.48
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\46\ Comment 222 and Comment 225.
\47\ Comment 222, p.1.
\48\ These 72 comments, mostly using one of four form letters,
also urged that all proposed changes be rejected. One writer from
this group indicated that he had a change he would like to suggest
but stated ``my understanding is that it [the JVC proposal] must be
accepted in whole or rejected in total.'' Comment 60, p.1. Staff
contacted this commenter, Richard Goldman, president of Frederick
Goldman, Inc., who indicated that the group to which he belongs was
advised, by a person he did not identify, that the JVC proposal had
to be accepted or rejected in its entirety. Thus, this group's
opposition to all other proposed revisions appears to be based on a
false premise.
These 72 commenters are: London Star (20); Luria (28); Armel
(32); Mendelson (33); Fashion (35); Courtship (36); MAR (37); NY
Gold (39); Aviv (40) and (41); TransAmerican (43); Saturn (46);
Faleck (50); Alarama (51); Fabrikant (53); Light Touch (54); Disons
(55); Astoria (56); PanAmerican (57) and (101); Odi-Famor (58);
Black Hills (59); Goldman (60); Almond (63); Brilliance (68); Oroco
(69); Fargotstein (70); Simmons (71); Mikimoto (72); Evvco (73);
Renaissance (74); Harvey (75); JGL (77); Raphael (78); AMG (79);
Vijaydimon (80); Philnor (93); Orion (94); Flyer (95); Classique
(96); Vardi (97); K's (98); Diastar (99); Foster (100); Fame (102);
Cheviot (104); M&L (105); Kurgan (107); Rosy Blue (108); NEI (110);
Leer (114); Majestic (115); Imperial (117); Schneider (119);
Precision (121); New Castle (122); Stern (157); Consumers (158);
Ultra Blue (160); DeMarco (161); Little (164); Golden West (179);
Stanley (180); Mastro (190); Capitol Ring (191); Bogo (201);
Schaeffer (211); Suberi (214); Impex (220); Landstrom's (241);
Ultimate (243); and Murrays (264).
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B. Conclusion
The comments largely favor retention of the Guides and state that
there is a continuing need for the Guides. The comments indicate that
the benefits of the Guides outweigh the costs, and present no
persuasive evidence that the Guides have outlived their usefulness or
impose substantial economic burdens. Accordingly, the Commission is
retaining the Guides.
Many comments recommended that the Guides be revised to reflect
changed technologies, and the Commission has considered these comments
in amending the specific provisions of the Guides, discussed below. The
comments that favored rejecting the JVC proposal and retaining the
Guides as they exist now usually did so because of a particular JVC
recommendation. The objections to those proposals also are addressed as
they occur in the different Guide categories.
III. Changes to the Form of the Guides
A. Legal Language Used in the Guides
The legal language in the Guides has been revised to conform to the
Commission's view on deception and unfairness as expressed in its
Policy Statements on Deception and Unfairness.49 Specifically, the
phrase ``it is an unfair trade practice,'' generally has been revised
to state ``it is unfair or deceptive to * * *.''
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\49\ Statement on Deception, appendix to Cliffdale Assocs.,
Inc., 103 F.T.C. 110, 1734-84 (1984) and Statement on Unfairness,
appendix to International Harvester Co., 104 F.T.C. 949, 1072
(1984).
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B. Consolidation of the Guides
Detachable metallic watch bands are the subject of the Guides for
the Metallic Watch Band Industry (``Watch Band Guides''), 16 CFR Part
19. Metallic watch bands that are permanently attached to the watch are
included in the Guides for the Watch Industry, 16 CFR Part 245. The JVC
proposed combining the Watch and Metallic Watch Band Guides with the
Jewelry Guides and the FRN solicited comment on this proposal. Thirty
comments addressed this issue, and 22 stated the Guides should be
consolidated.50 Most
[[Page 27181]]
of those who gave reasons for favoring consolidation mentioned the
Watch Band Guides rather than the Watch Guides.51
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\50\ JMC (1); Fasnacht (4); Gold Institute (13); Benrus (22);
Estate (23); G&B (30); Jabel (47); Skalet (61); Lannyte (65);
Newhouse (76); Nowlin (109); McGee (112); ArtCarved (155); Bales
(156); Bedford (210); Bridge (163); IJA (192); Canada (209); Matthey
(213); Bedford (210); MJSA (226); and Leach (258).
\51\ E.g., Bedford (210) commented, at p.3, that ``as watch
bands are mostly sold and fitted by jewelers, it would seem
appropriate * * * that they be combined with the jewelry
guidelines.'' However, no commenters identified themselves as
watchband manufacturers.
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Six of the eight comments opposing consolidating the Guides were
from watch manufacturers or trade associations.52 The reasons
given for opposition were primarily related to the consolidation of the
Watch Guides, not the Watch Band Guides. The American Watch Association
stated that the Guides correctly reflect the fact that watches and
jewelry are different products, ``by imposing substantially different
definitions and standards for watches and jewelry.'' 53 For
example, the minimum thickness in the Watch Guides for gold
electroplated watches is about 100 times thicker than the minimum
thickness for gold electroplated jewelry in the Jewelry Guides.54
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\52\ USWC (118); JCWA (216); NACSM (219); Best (225); Citizen
(228); Swiss Federation (232); AWA (236); and Timex (239). Only one
comment from the affected industry, Benrus (22), favored
consolidation of the Watch Guides.
\53\ Comment 236, p.1. See also Swiss Federation (232) p.1 (the
industries are separate and consolidating the Guides would make use
of the Guides difficult) and Citizen (228) p.5 (watches and jewelry
are dissimilar and should not be combined).
\54\ See also JCWA (216) p.4 (favoring separate Guides because
the application of materials and quality demands differ for watches
and jewelry); Timex (239) pp.9-10 (opposing consolidation if doing
so would create any additional compliance obligations); Swiss
Federation (232) p.38 (stating that jewelry, watch and watch band
companies are separate industries, with separate trade
associations).
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Based on the comments, the Commission has determined not to combine
the Guides for the Watch Industry with the other two Guides. The Guides
for the Watch Industry will remain as separate Guides and are discussed
in another Federal Register notice. However, the Commission has
determined to consolidate the Guides for the Metallic Watch Band
Industry with the Jewelry Guides.55 The Watch Band Guides
primarily concern ``fineness'' standards for precious metals, which are
the same as those contained in the Jewelry Guides.56 Thus, unlike
the Guides for the Watch Industry, the Watch Band Guides share many
common elements with the Jewelry Guides.57 Therefore,
consolidation of these two Guides eliminates unnecessary
duplication.58
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\55\ JCWA (216), Citizen (228), and AWA (236) stated that all
three Guides should be kept separate, but none of these provide
reasons for keeping the Watch Band Guides separate.
\56\ ``Fineness'' refers to the amount of precious metal in an
article.
\57\ For example, the provisions for gold electroplated metal
watch bands in the Watch Band Guides are the same as those for gold
electroplated metal products included in the Guides for the Jewelry
Industry.
\58\ More than half of the material in the Metallic Watch Band
Guides duplicates material in the Jewelry Guides.
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IV. Category-By-Category Explanation of Revisions
This section discusses specific proposed revisions on which the
Commission sought comment in the FRN and additional issues raised by
the comments. This discussion includes a summary and analysis of the
comments on each issue and a discussion of the revisions that the
Commission has made. (In some instances there were no comments on
particular proposals.)
A. Pre-Category I--Scope and Application: Sec. 23.0
Section 23.0 in the current Guides is captioned ``Definitions,''
and gives definitions for: ``diamond,'' ``pearl,'' ``cultured pearl''
and ``imitation pearl.'' In the JVC proposal, section 23.0 is titled
``Scope and Application,'' and the definitions appear in the sections
that specifically address these products. The Commission has determined
that this organizes the Guides in a more helpful fashion and adopts
these changes.
Part (a) of section 23.0, as proposed by the JVC, lists industry
products to which the Guides apply and part (b) defines industry
members. The term ``industry products'' is used throughout the Guides,
but it is not explicitly defined. To avoid any uncertainty about their
intended coverage, the revised Guides include a definition of
``industry products.''
The JVC petition specifically suggested that the term ``industry
products'' include pens, pencils and optical frames containing gold or
silver. The FRN sought comment on whether provisions applying to the
gold or silver content of pens, pencils and optical products should be
included in the Guides, and whether they should be the same as the
current provisions for jewelry. Thirty-one comments addressed this
issue, and 25 favored including these products, including two major
manufacturers of writing implements, Sheaffer and A.T. Cross.59
The six commenters that opposed the inclusion of these products simply
stated that they saw no need for the inclusion of these products or
that they were not ``really'' jewelry products.60
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\59\ Fasnacht (4); Gold Institute (13); Estate (23); Korbelak
(27); G&B (30); Jabel (47); Schwartz (52); Skalet (61) p.3 (stating
that the items are typically sold in jewelry, department and gift
stores, and thus should be subject to the same standards as jewelry
sold in the same store); Handy (62); Lannyte (65); Newhouse (76);
McGee (112); Bales (156); Bridge (163) p.2 (stating that the
metallic content of the items is more likely to be misrepresented if
they are not included in the Guides); Cross (165) p.1 (favoring
inclusion, because the mislabeling of these products, ``especially
by counterfeiters, has caused confusion by customers and harmed the
business of legitimate manufacturers''); IJA (192); Tru-Kay (196)
p.1 (stating that the public would find different standards for the
metal content of these items as opposed to jewelry confusing); Mark
(207) p.3 (same as Tru-Kay); Canada (209); Bedford (210); MJSA (226)
p.3 (stating that without inclusion in the Guides, there may be more
misrepresentation of metallic content); Preston (229); Sheaffer
(249) p.2 (favoring inclusion, but objecting to ``unnecessary and
arbitrary limitations'' on the use of the term `Plate' to describe
gold electroplated articles); Franklin (250); and Knight (256).
Although no current manufacturers of eyeglass frames commented,
Knight (256) stated, at p.2, that ``We at one time owned the largest
manufacturer of gold filled and rolled gold plate frames in the
U.S.A. and they followed the jewelry guides.''
\60\ LaPrad (181); Nowlin (109); ArtCarved (155); Service (222);
Franklin (250); and NACSM (219).
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The comments generally indicate that pens, pencils, and opticals
made of precious metals are viewed by consumers as similar to jewelry
because of their metallic content and where they are sold. Thus,
consumers would tend to expect that claims about such products would be
guided by the same standards that apply to other industry products.
Because consumers' expectations about the meaning of terms such as
``gold'' are likely to be the same for any product, the Commission is
including these items in the Guides. These products and detachable
metallic watch bands are now specifically listed in Sec. 23.0(a) of the
revised Guides. The title of the Guides is now the Guides for the
Jewelry, Precious Metals, and Pewter Industries to reflect the coverage
of the Guides.61
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\61\ See infra for a discussion of the inclusion of items made
from pewter.
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Although the JVC petition did not list hollowware or flatware as
``covered products,'' section 23.6A of the JVC petition addresses
sterling hollowware and flatware. The Franklin Mint objected to this
because these items are not jewelry.62 However, these items are
commonly sold in jewelry stores, and at least one of the commenters
simply presumed that these items were covered
[[Page 27182]]
by the Guides.63 As with pens and pencils made of precious metal,
the Commission believes that consumers would tend to expect that claims
about silver or gold hollowware or flatware would be guided by the same
standards that apply to other industry products. Therefore, these
products also are included in the list of industry products covered by
the Guides.
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\62\ Comment 250, p.3. The Franklin Mint stated that ``industry
products'' should be limited to jewelry, which it defined as an
ornamental item worn on or about one's person for personal
adornment. (The Franklin Mint primarily markets objects that are not
used for personal adornment, but which incorporate or are made of
precious metals or gemstones, so that its proposal would exempt most
of the products it carries from the application of the Guides.)
\63\ See Gold Institute (13).
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The Guides also refer to ``industry members,'' but do not define
this term or give examples. The JVC proposed that the Guides state they
apply to ``every firm (a person, group of persons, or corporation)
engaged in the business of selling'' industry products. One commenter
noted that the Guides need to clarify that purchasers at all levels of
the industry are protected by the Guides, since it is commonly assumed
by courts that merchants are experts who should know better than to
rely on suppliers' representations as being accurate.64
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\64\ ISA (237) p.12 (stating further that the Guides should
``address all issues of intended disclosure to resellers of jewelry
products so that this information can accurately and completely be
passed on to the ultimate consumer'').
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The Commission agrees that it would be useful to clarify that
retailers, as well as consumers, are meant to be protected from
deceptive practices addressed by the Guides. Therefore, the revised
Guides state that they apply to persons, partnerships, or corporations
at every level of the trade.
The JVC also proposed, in section 23.0(b), including in the
description of industry members (in addition to sellers) those who are
engaged in ``identifying, grading, appraising, promoting the sale of or
counseling the purchase or barter of industry products.'' The FRN
specifically requested comment on whether the Guides should be expanded
to include appraisals of jewelry in addition to sales and offers to
sell jewelry.
Thirty-five comments addressed this question.65 The comments
generally favored including appraisers of jewelry industry products
among those subject to the Guides. The main effect of including
appraisers (or those ``identifying'' and ``grading'' industry products)
among those covered by the Guides would be to ensure that they would be
guided by the same definitions and standards as those selling the
products. To confirm the value of an intended purchase, consumers often
seek an appraisal because they rarely independently have the knowledge
to determine the quality or value of jewelry.66 The Commission has
concluded that it would be unfair or deceptive for appraisers to
ascribe meanings to standard terms that are used in the jewelry
industry that are different from the meanings attached to those terms
by the sellers of the products. Thus, appraisers and those
``identifying'' and ``grading'' industry products are advised to follow
the admonitions of the Guides.67
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\65\ E.g., AGS (18); AGTA (49); GIA (81); IJA (192); and ISA
(237 and 237A).
\66\ An ``independent'' appraisal is one done by a person who
has no commercial relationship to the seller and does not sell
competitive merchandise. In other words, the person who does the
appraisal does not stand to benefit beyond his appraisal fee.
\67\ The Commission is omitting from the list those who promote
the sale, or counsel the purchase or barter, of industry products,
because this language is unnecessarily specific, and because such
persons are already covered by the language of the Guides (e.g.,
persons who sell or offer for sale industry products).
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However, 29 of the comments also recommended that the content of
appraisals be covered by the Guides. Fifteen of these stated this
change should be effective with this revision.68
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\68\ JMC (1); Sibbing (5); Thorpe (7) p.2 (stating that
appraisals are sometimes used to make a sale by showing the consumer
``a signed document stating an inflated value''); King (11); Estate
(23); G&B (30) p.7 (noting that ``you are going to have to
understand appraisals are subjective''); Jabel (47); Skalet (61) p.3
(suggesting that ``appraisers should be certified or licensed and
should have no connection with those who are making the sale'');
Lannyte (65) p.4 (proposing that the Guides state that ``an
appraisal has to be qualified as to the purpose of appraisal and the
market level of the value quoted''); Eisen (91) p.1 (suggesting that
the Guides should provide for ``a statement on no conflict of
interest, disallowance of a percentage fee, and a resume with the
appraiser's qualifications''); McGee (112); ArtCarved (155); LaPrad
(181); AGL (230) pp.4-6 (proposing that the Guides state that it is
unfair for a seller to provide an appraisal to a consumer when the
appraiser is also the supplier of the item being appraised, and
recommending that the Guides specify certain required content of
appraisals of diamonds or colored stones (e.g., ``appropriate
tolerance information for each element that impacts on the value of
the gemstone''); and ISA (237) and (237A) p.5 (stating that
important problems are misrepresentation of qualifications and
overstating of value to justify the selling price). Only one
comment, LaPrad (181), proposed standards to use (those of the
Appraisal Foundation).
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However, if the Guides were to regulate the content of appraisals,
standards for establishing a value would be needed.69 Fourteen
comments, including those of the American Gem Society, the American Gem
Trade Association, and the Gemological Institute of America,
recommended including appraisals in the Guides when there is adequate
agreement on what the standards for appraisals should be.70
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\69\ ISA (237A) noted, at p.18, that a New York City ordinance
requires that appraisals state that ``the opinions of appraisers can
vary up to 25%.'' ISA stated that the opinions of appraisers,
``depending on marketplace, variances in grading, and geographical
market locations, as well as various purposes and functions and the
method of value conclusion can cause appraisers to vary in their
opinions of value for amounts potentially greater than 25%.'' Id.
\70\ AGS (18); AGTA (49); GIA (81); IJA (192); Fasnacht (4);
Honora (15); Bridge (163); Mark (207); Bedford (210); Matthey (213);
MJSA (226); and Preston (229) p.6 (stating that there are different
formats and standards used for jewelry appraisals and that ``[t]here
is no overall agreement within the industry on precisely what does
or does not constitute the ultimate desirable appraisal'').
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Although the Commission has determined that for the sake of
consistency for consumers purchasing industry products, the Guides will
state that those who appraise, identify or grade industry products
should follow the Guides, they do not otherwise purport to guide these
industries.71
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\71\ ISA (237) noted, at p.2, that its members are appraisers in
more than ``130 subspecialty areas of the major personal property
disciplines * * *.'' It stated, at p.7, that while it prefers to
have its own industry guide, it favors the inclusion of appraisals
in the Guides, because ``many times we serve as expert witnesses in
court and rely on the content of the guides to inform the court as
to what is or is not acceptable.'' The Commission believes ISA's
concerns will be satisfied by the language added to the Guides.
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The JVC proposal included, in section 23.0(c), a description of the
behavior (claims and representations) to which the Guides apply. It is
similar to Sec. 23.1(b) of the current Guides, but does not list the
specific forms of advertising (periodicals, radio, television) that are
described in Sec. 23.1(b). The Commission's authority, however, is
broader than the items currently listed as advertising in the Guides,
and therefore the specific list unnecessarily limits the scope of the
Guides. The National Retail Federation comment stated that such
specifically enumerated limitations are helpful as they may prevent
other representations, such as in-store signs or flyers, from being
treated as advertising.72 However, that is not the intent of that
section. Accordingly, Sec. 23.0(c) of the revised Guides encompasses
express and implied claims in all types of advertising and promotion.
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\72\ Comment 238, p.1.
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B. Category I: Secs. 23.1-23.4
Guides in this part apply to all industry products regardless of
their composition.
Section 23.1(a) of the current Guides contains a list of
attributes, such as origin and durability, which industry members are
advised not to misrepresent. The JVC proposal omits ``manufacture''
from the list (possibly in error). The Commission has found no basis in
the record for deleting ``manufacture'' from the list of items not to
be misrepresented.
The JVC proposed adding the following attributes to the list of
[[Page 27183]]
characteristics that should not be misrepresented: ``clarity,''
``enhancement,'' ``future value,'' and ``prospects of resale.'' The
Commission believes that the term ``clarity'' is unnecessarily
specific, as it is already covered by the current Guides under
``grade'' and ``quality.'' Therefore, this term has not been included.
``Enhancement'' is the term used by the trade to describe the treatment
of gemstones to improve their color or otherwise improve their
appearance. However, the Commission has determined that a more accurate
term is ``treatment'' and has added this term, in lieu of
``enhancement,'' to the list of attributes that should not be
misrepresented. The Commission has determined that the third term,
``future value'' should not be added to the Guides, because the Guides
already list ``value,'' and ``future value'' is subsumed in value. The
Commission also has determined that ``prospects of resale'' should not
be added to the Guides. Representations regarding the prospects of
resale go to the investment of gems, and the Commission has concluded
that the sale of investment gems is unsuitable for treatment in guides.
The JVC proposed adding five additional parts to Sec. 23.1, which
would be designated as follows: Misrepresentation of the character or
identity of business; Misuse of the term ``certified,'' etc.; Deception
(as to gemstone investments); Misuse of the term ``investment
quality''; and Deception as to warranties on gemstone investments.
Discussion of each of these proposed additions follows.
Misrepresentation of the character or identity of business was the
caption of a section of the Jewelry Guides that was in effect from 1957
to 1979. This section admonished sellers from, for example,
misrepresenting themselves as wholesalers or as offering wholesale
prices.73 NACAA commented that it is important to prohibit such a
misrepresentation, noting that ``retailers use phrases such as `factory
direct' to imply that items are less expensive, when in fact they
obtain their merchandise through jobbers and other outside sources.''
74 However, Sec. 23.1 warns against misrepresentation as to the
``manufacture'' or ``distribution'' of industry products and this
provision would encompass misrepresentations about the nature of the
seller's business.
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\73\ The JVC also proposed expanding this section by adding
``investment broker'' and ``independent testing laboratory'' to the
list of examples of trade designations that firms are not to use
falsely. ISA (237) recommended adding ``gemological laboratory'' and
``appraisal facility'' to the list.
\74\ Comment 90, p.2.
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Misuse of the term ``certified,'' etc. was the caption of a section
in the Guides that were in effect between 1957 and 1979 and which the
JVC proposed reinstating. This section stated that it was an unfair
trade practice to refer to an industry product as ``certified'' unless
the identity of the certifier and the specific matter to be certified
is disclosed; the certifier examines the product, makes the
certification, and is qualified to certify; and the certifier makes
available a certificate that includes certain information about the
certifier and the certification.75
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\75\ The JVC also proposed requiring the disclosure of any
business relationship between the certifier and the seller.
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Thirty-two comments favored requiring the seller to make available
to the purchaser a certificate disclosing the name of the certifier and
the matters and qualities certified.76 The term ``certified'' or
certificates of authenticity are likely to be used as a way of giving
credence to a quality claim. If, in fact, the product is not
``certified'' in a valid manner or a certificate misrepresents the
qualities of the item, the seller is not complying with the Guides'
admonition in Sec. 23.1 not to misrepresent important qualities or
otherwise deceive purchasers. For this reason, the Commission is not
including a provision relating to certificates in the Guides.77
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\76\ JMC (1); Fasnacht (4); Thorpe (7); King (11); Honora (15);
Argo (17); AGS (18); Capital (19); Estate (23); G&B (30); Jabel
(47); AGTA (49); Schwartz (52); Skalet (61); Lannyte (65); Newhouse
(76); GIA (81); NACAA (90); Nowlin (109); McGee (112); ArtCarved
(155); Bridge (163); LaPrad (181); IJA (192); Matlins (205); Bedford
(210); Matthey (213); Bruce (218); MJSA (226); Preston (229); ISA
(237A); and Leach (257).
Opposed to this provision are: Bales (156) p.5 (stating that it
would raise costs and eliminate many smaller jewelers); NACSM (219);
Service (222); and Franklin (250).
With respect to the issue of whether there should be a
disclosure that there is subjectivity in the grading and appraising
of diamonds and colored stones, a comment form AGTA (49) and 56
individual AGTA members opposed disclosure, stating at p.6, that the
degree of subjectivity is ``better addressed by those in the
business of operating laboratories for certificates * * * and to
those associations governing appraisers.'' However, ISA (237A)
stated at p.21, that appraisal reports should disclose that diamond
and colored stone gradings are subjective in nature. Thorpe (7), AGS
(18), Schwartz (52), Skalet (61), NACAA (90), Bruce (218), and
Preston (229) were also in favor of the disclosure of the degree of
subjectivity in grading.
\77\ Certificates have no accepted meaning in the industry and
are not defined in the standard dictionary for the industry
[``Jewelers' Dictionary'' (3d ed. 1976)]. See AGTA (49) p.5
(favoring the proposal, but stating that since ``there are no
nationally accepted standards for certification,'' the requirement
that a certificate state the name of the certifier ``is no assurance
of either expertise or quality''); NACSM (219) p.24 (stating that
the proposed section was ``vague and broad in that it could be
construed to make any sales slip identifying the product a
certification''); Service (222) p.2 (stating that the current Guides
``are sufficient to prevent deception with certifications and
appraisals'').
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However, some commenters suggested that the Guides address
misrepresentation of the system of grading that was used in any
certificate or grading report.78 There are several different
diamond color grading systems in general use, each having its own
standards and terminology, and several grading systems for colored
stones.79
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\78\ Rapaport (233) p.1 (stating that misuse of GIA color and
clarity terminology by sellers (as opposed to appraisers or graders)
is a major problem and suggesting that the Guides state that it is
unfair to misuse GIA grading terminology); Thorpe (7) p.2 (stating
that an identification of the grading system used ``is necessary to
make accurate quality comparisons''); Shor (257) p.1 (suggesting
that the Guides state that it is unfair to describe diamonds by
color and clarity grades developed by GIA or other recognized gem
labs ``unless they conform exactly to the standards set forth by
those institutions'').
\79\ Richard T. Liddicoat, Jr. & Lawrence L. Copeland, ``The
Jewelers' Manual'' 29-32 (1967); AGL (230); Rapaport (233) p.1. The
Gemological Institute of America (GIA) and the American Gem Society
(AGS) employ different grading systems, and some diamond graders
have their own ``in-house'' grading systems. The letter ``D''
designates the best color in the GIA grading system. Some in-house
grading systems have grades that start with ``A,'' ``AA,'' or
``AAA'' and consequently ``D'' in their systems stands for a much
poorer color grade.
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The Commission is persuaded that a representation that a stone is a
specific grade could be deceptive if the identity of the grading system
used is not disclosed. Section 23.1 states that it is unfair or
deceptive to misrepresent the grade of an industry product. The
Commission has added a Note to Sec. 23.1 that states that, if any
representation is made regarding the grade assigned to an industry
product, the identity of the grading system used should be disclosed.
The FRN solicited comment on the JVC's proposed subsections 23.1(d)
through (f), which address deception involving gemstone investments.
Section 23.1(d) would require, in the sale of gemstones as investments,
a disclosure that profit or appreciation cannot be assured, that no
organized market exists for the resale of gemstones by private owners,
and that the seller is in compliance with all applicable laws and
regulations governing securities dealers. In general, the comments
favored these disclosures.80
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\80\ JMC (1); Fasnacht (4); Sibbing (5); Thorpe (7); King (11);
Honora (15); Argo (17); AGS (18); Capital (19); G&B (30); Jabel
(47); Schwartz (52); Skalet (61); Lannyte (65); GIA (81); Eisen
(91); Nowlin (109); McGee (112); ArtCarved (155); Bales (156);
Bridge (163); IJA (192); Bedford (210); Matthey (213); Bruce (218);
Shire (221); MJSA (226); Preston (229); Limon (235); ISA (237A);
Leach (257); and AGTA (49) (favoring the proposal for sales to
consumers but opposing the proposal for inter-trade transactions
(e.g., a sale by a dealer to a retailer).
Opposed to this provision: Onyx (162) and Rapaport (233) p.4
(stating that ``there are regular ongoing markets for the resale of
diamonds and colored stones by private owners'' such as auction
houses, jewelry stores, estate jewelry shows, and pawnshops). But
see Shire (221) p.3 (stating that these examples do not constitute a
ready market, since auction houses, for example, only want specific
items and do not take everything for sale). The Commission believes
that most consumers know that they, as individuals, would not have
access to a market comparable to the stock market; hence, a
disclosure would not be necessary to prevent deception in the
absence of an affirmative misrepresentation as to the nature of the
market.
There is no evidence indicating that consumers believe that
sellers of investment gemstones are governed by laws and regulations
covering securities dealers.
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[[Page 27184]]
The comments favoring these disclosures also generally favored the
proposed sections 23.1(e) and (f). Proposed part (e) would prohibit the
seller from implying that a gemstone sold for investment purposes is
more desirable or different than gemstones marketed for use in
jewelry.81 Proposed part (f) states that it is an unfair practice
to limit a purchaser's opportunity for an independent examination of an
industry product by delivering a product in a sealed container with a
warranty that becomes void if the seal is broken.82 This practice
makes it impossible for the consumer to examine the product or retain
an independent expert to examine or appraise the product to determine
whether the seller has fairly represented it. On the other hand, a
consumer can refuse to buy a product sold under these conditions.
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\81\ See comments cited in note 80, and NACAA (90) and LaPrad
(181). These comments are mostly from retail jewelers who would not
usually sell gemstones as investments. Ethical sellers of gemstones
for investment purposes may provide gemstones that are a higher
grade then those commonly sold as jewelry.
\82\ See comments cited in note 80. Rapaport (233) stated, at
p.4, that it would be acceptable to deliver the product in a sealed
container with a warranty that becomes void if the seal is broken,
if the sealing agency allows the re-sealing of the product at a
reasonable cost and discloses this at the time of sale.
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The FRN asked if there would be voluntary compliance with the
proposed guidelines for sellers of investment gemstones. Thirteen
comments stated that voluntary compliance could not be expected.\83\
Six comments stated that compliance could be expected only from
legitimate operators.\84\ Five comments anticipated voluntary
compliance by all concerned.\85\
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\83\ King (11); Argo (17); Jabel (47); Schwartz (52); Skalet
(61); GIA (81); Nowlin (109); McGee (112); ArtCarved (155); IJA
(192); Matthey (213); Shire (221); and Leach (257).
\84\ Fasnacht (4); AGTA (49); Bales (156); LaPrad (181); Bedford
(210); and ISA (237A).
\85\ Sibbing (5); Thorpe (7); Honora (15); Bridge (163); and
MJSA (226).
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An industry guide is not appropriate if there is an indication that
the violations are willful or wanton and will not be voluntarily
abandoned. The experience of the Commission in bringing cases against
sellers of investment gemstones indicates that most of the sellers have
been engaged in fraud. Thus, they are unlikely to comply with practices
that would be likely to put them out of business. The Commission has
concluded that a case-by-case approach is a more appropriate way to
address the problem of gemstone investment claims than inclusion in the
Guides.
The JVC did not propose any substantive changes in the last three
sections in Category I (23.2, 23.3, 23.4), and there were no comments
pertaining to these sections. The Commission has decided to retain
sections 23.2 and 23.4. Section 23.2 states that it would be deceptive
to use depictions that would materially mislead consumers about the
product shown.\86\ Section 23.4 states that it would be deceptive to
use the term ``handmade'' unless the item is entirely handmade or made
by manually controlled methods consistent with consumer expectations.
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\86\ The Postal Service (244) stated that mail order purveyors
of jewelry sometimes use deceptive photographs to sell their wares.
This section notes that such a practice is unfair or deceptive, and
a following Note specifically states diamonds should not be depicted
in greater than actual size without a disclosure that the depiction
is an enlargement. The JVC proposed expanding the Note to include
depictions of gemstones other than diamonds, and the Commission has
made this change. In addition, because television shopping programs
or computer images also may contain misleading images of jewelry,
the Commission has added ``televised or computer image'' to the list
of covered ``visual depictions'' in this section.
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However, the Commission has determined to delete section 23.3. The
admonition in section 23.3(a) against misrepresenting the origin of a
product repeats the general guidance provided in section 23.1 (which
provides a list of characteristics, including origin, which should not
be misrepresented). Section 23.3(b) states that a disclosure of foreign
origin should be made only when it is deceptive not to do so. A Note
following this section explains that it is not necessary to disclose
the foreign origin of small and functional parts, or other items (such
as diamonds) which are primarily obtained from sources outside the
United States. U.S. Customs requires products being imported into the
U.S. to be marked with the country of origin unless they will be
substantially transformed in the United States.\87\ Thus, the
Commission has concluded that this section of the Guides is
unnecessary.
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\87\ See The Tariff Act of 1930, as amended, 19 U.S.C. 1304, and
Customs' implementing regulations, 19 CFR 134.11.
---------------------------------------------------------------------------
The Commission also has deleted Sec. 19.4(b) of the Watch Band
Guides, which states that it is unfair to fail to disclose that a
metallic watchband, or a substantial part thereof, is of foreign
origin.\88\ No commenters identified themselves as watchband
manufacturers or marketers, and very few commenters even addressed the
existence of the Watch Band Guides. It is unclear whether the fact that
a watchband is made abroad is material to consumers, or whether
consumers currently expect that any unmarked metallic watchband was
made in the U.S.A. However, as noted, U.S. Customs requires imported
watchbands (and other items of commerce) to be marked with the country
of origin. Therefore, the Commission has concluded that this section is
unnecessary.\89\
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\88\ The Watch Band Guides contain very detailed instructions
as to the labeling of watchbands assembled in the U.S. of foreign
components. 16 CFR 19.4(b), note 2. Several Commission orders, from
the 1960's or earlier, require similar detailed disclosures.
However, the Commission recently issued a ``Sunset Rule'' that
terminates administrative orders automatically after 20 years. 60 FR
58514 (Nov. 28, 1995).
\89\ More specific guidance on when industry products can be
marked ``Made in the U.S.A.'' is likely to be addressed further by
the Commission later this year.
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C. Metals (Category II): Secs. 23.5-23.8
Guides in Category II, in both the current Guides and the JVC
petition, apply to industry products composed in whole or in part of
precious metal. In the JVC petition, this category also includes a
proposed standard for pewter.
1. Inclusion of Metallic Watchbands
As noted previously, the Guides for the Metallic Watchband Industry
have been combined with the Jewelry Guides. The Commission believes
that, in most respects in which the Watch Band Guides differ from the
Jewelry Guides, the Watch Band Guides are unnecessarily restrictive or
no longer represent the Commission's views of how the law should be
applied. For example, unlike the Jewelry Guides, the Watch Band Guides
state that it is unfair to fail to disclose the metallic composition of
a product which has the appearance of gold but is not gold
(Sec. 19.2(A)(2)). There is no evidence that suggests that consumers
today will infer that a gold-colored metal watch band is gold. The
prices for gold-colored
[[Page 27185]]
metallic watch bands compared to what gold watch bands (or other gold
jewelry) would sell for is at least one way consumers are alerted that
a gold-colored band is not gold.\90\ Thus, the Commission has omitted
this provision from the Guides.
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\90\ To the extent that sellers purposely inflate the price of
their gold-colored products to lead consumers to believe they are
purchasing a gold item, they are probably engaging in fraud and are
likely to misrepresent the item as gold when it is not, which would
be a deceptive practice under Sec. 23.5(a).
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Other differences between the Watch Band Guides and the Jewelry
Guides are noted at appropriate portions below.
2. Misrepresentation as to Gold Content: Sec. 23.5
Section 23.5(a) of the current Guides states that it is an unfair
trade practice to sell or offer for sale any industry product by means
of any representation that would deceive purchasers as to the gold
content. Section 23.5(b) identifies specific practices that may be
misleading and section 23.5(c) lists markings and descriptions that are
consistent with the principles described in the section. These latter
provisions are ``safe harbors'' (i.e., examples of ways of avoiding
misrepresentations).
a. General provision as to misrepresentation: Sec. 23.5(a). As
noted, Sec. 23.5(a) of the current Guides contains a general provision
admonishing against misrepresenting the gold content of industry
products. The JVC proposed adding definitions of ``karat,'' ``gold,''
``karat gold,'' ``fine gold,'' ``mark,'' and ``apply or applied'' to
this section.91 No evidence indicating confusion as to the meaning
of the terms was presented. In some cases, the terms are already
defined very succinctly in the current Guides.92 For these
reasons, the Commission has not included the proposed definitions in
the Guides.
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\91\ Only one comment specifically addressed the proposed
definitions. Finlay (253) stated at p.1 that it did not object to
the proposed definitions of ``gold.''
\92\ For example, the JVC proposed defining ``fine gold'' as
``gold of 24 karat quality.'' However, Sec. 23.5(b)(1) of the
current Guides simply refers to ``fine (24 karat) gold.'' Similarly,
although the JVC proposed a new definition for ``quality mark''
specifically for gold, the more general definition in Sec. 23.8 of
the current Guides (defining the term ``mark'' in conjunction with
precious metals generally) is clearer and more accurate. See
discussion regarding quality marks below.
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The JVC also proposed including a statement that no mark other than
the quality mark (e.g., 14 K) shall be applied to an article indicating
that it contains gold or as to the quality, fineness, quantity, weight,
or kind of gold in an article. The Commission found no justification or
need for such a broad statement. Section 23.5(a) already states that
misrepresentations about the gold content of an article are unfair or
deceptive.
b. Specific provisions and ``safe harbors'': Sec. 23.5(b)-(c).
Section 23.5(b) in the current Guides identifies specific practices
that may be misleading. Subsection (1) states that the unqualified use
of the word ``gold'' is limited to 24 karat gold. The JVC proposed
adding that the unqualified use of ``solid gold'' is limited to 24
karat gold. There were two comments on this issue, one favoring the JVC
proposal because ``solid gold should mean that the product is 100%
gold,'' and one against the proposal, since fineness must be disclosed
for all gold other than 24 karat gold.93 The Commission believes
that the term ``solid gold'' is not inherently deceptive or
unfair.94 Accordingly, the Commission has rejected this proposal.
---------------------------------------------------------------------------
\93\ Lee (153); NRF (238) p.1.
\94\ For example, the phrase ``solid 10 karat gold'' is not
likely to lead consumers to believe the item is 24 karat gold. See
Advisory Opinion, ``Solid'' and ``karat'' used together, 71 F.T.C.
1739 (1967).
---------------------------------------------------------------------------
Subsection (2) in the current Guides advise that (except for 24
karat gold), the karat fineness be stated when the word ``gold'' is
used. The JVC did not suggest any changes in this section, and only
suggested minor changes in the corresponding ``safe harbor'' provision
in Sec. 23.5(c)(1).95 However, Finlay argued that the word
``gold'' should be allowed in product advertising without a designation
as to karat fineness.96 Including karat fineness in advertising,
however, helps consumers make basic comparisons among competing
products offered by different retailers. Therefore, the Commission has
not changed this provision.
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\95\ This safe harbor provision simply states that an industry
product composed throughout of an alloy of gold of not less than 10
karat fineness, may be described as ``Gold'' when the word ``Gold''
is immediately preceded by a correct designation of the karat
fineness. The JVC suggested following the words ``an alloy of gold
of not less than 10 karat fineness'' with ``less tolerance set out
in 15 U.S.C. 294, et seq.'' [the National Stamping Act] and
footnoting that statement with a detailed explanation of the
tolerance. The tolerances are set forth in Sec. 23.5(d) of the
current Guides and are more easily understood in the current format.
\96\ Comment 253, p.1 (stating that this ``will not mislead
consumers where all other requirements of the guidelines have been
met and where information as to karat fineness is given at the point
of sale''). See NRF (238) p.1 and discussion infra, regarding the
scope and application of the Guides.
---------------------------------------------------------------------------
A Note following the first ``safe harbor'' provision,
Sec. 23.5(c)(1) in the current Guides, deals with hollow products and
advises that there be a disclosure that these products, whatever their
gold content, have hollow centers, when the failure to make such a
disclosure would be deceptive. It also states that these products
should not be referred to as solid gold. The JVC proposed revising the
note to drop the guidance that there be a disclosure that the product
is hollow. However, the Commission has determined that this disclosure
is useful because, otherwise, consumers would be unaware that the
product is only hollow. Thus, the Commission has not deleted this
FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
provision. The JVC also suggested that the note be changed to state
that products that are filled with cement or some other filler may not
bear a quality mark. However, such products are essentially ``gold
plated'' products, and as long as they conform with the Guides'
provisions about how to mark such products, consumers are not likely to
be deceived. Thus, the Commission has decided not to adopt this
proposal.
Subsections (3)-(5) advise against particular uses of the word
``gold'' (e.g., plated, filled, rolled, overlay) unless they are so
qualified as to be non-deceptive. Subsection (6) advises against
representing that one gold product is superior to another unless the
representation is true.97
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\97\ A Note following this section provides guidance for the use
of the word ``gold'' as applied to certain words (Duragold,
Diragold, Noblegold, Goldine). The JVC proposed adding ``Layered
Gold'' to this list, and the Commission has done so.
---------------------------------------------------------------------------
Subsection (7) advises against the use of the word ``gold'' on any
product of less than 10 karat fineness. Bales proposed in its comment
that the Guides be amended to permit gold alloys containing less than
10 karats of gold (less than .416 percent gold) to be marketed as
containing gold. Bales has a patent on a product in which the gold
content varies from four to six karats and which is alleged to have
good corrosion resistance.98 This issue was addressed
comprehensively by the Commission in 1977.99 Thus, the
[[Page 27186]]
Commission has not changed this provision.
---------------------------------------------------------------------------
\98\ Comment 156, pp.5-8. LaPrad (181) stated at p.2 that ``gold
plated items should include any item that is not at least 10 karat
solid gold in fineness throughout the item.'' This suggests that an
alloy that contained less than 10 karat gold could be described as
``plated.'' However, ``plated'' has been used for many years to
refer to a base metal product with a coating of gold. Extending the
meaning of the term to low-karat alloys would be confusing.
\99\ The 10 karat minimum standard has been used at least since
1933, when it first appeared in Commercial Standard CS 67-38,
promulgated by the then Bureau of Standards of the U.S. Department
of Commerce. It was incorporated into the Trade Practice Rules for
the Jewelry Industry, 16 CFR Part 23, in 1957. In 1977, the
Commission proposed permitting sellers to market gold of less than
10 karat and silver of less than 92.5% if the quality was accurately
disclosed. This proposal was published for public comment. Over 1200
comments were received, many from consumers, and over 98% of the
comments opposed lowering the 10K standard. The Commission found,
based on articles and test reports, that articles of less than 10
karat fineness tend to tarnish and corrode. The Commission
ultimately retained the 10 karat minimum fineness for gold and the
92.5% standard for silver. 42 FR 29916, 29917 (1977).
---------------------------------------------------------------------------
The JVC petition also included an admonition against applying a
quality mark (e.g., 9 karats) to any article of less than 10 karat
fineness regardless of whether the word ``gold'' is used. Because the
word ``karat'' is so clearly associated with gold content (even without
the use of the word ``gold''), the use of the term ``9 karat'' is
likely to represent that the item is 9 karat gold. The Commission has
determined that advising against this use is consistent with and
clarifies the Guides.
On the basis of comments received in response to questions in the
FRN, the Commission has revised current Secs. 23.5(b)(3), (4), and (5).
These changes are explained in detail below, along with the changes to
the corresponding ``safe harbor'' provisions in subsection 23.5(c) of
the current Guides.
i. Mechanically or electrolytically ``plated'' products. There are
two basic kinds of ``plated'' gold. Mechanically plated gold has a
layer of gold alloy bonded to a base metal by heat and pressure. Gold
electroplate has a layer of gold alloy electrolytically deposited on a
base metal. Section 23.5(b)(3) of the current Guides states that a
surface-plated or coated article can only be referred to as ``gold''
when the term is adequately qualified so as to disclose that the
product or part is only surface-plated or coated with an alloy of gold.
However, for mechanically plated articles, it adds that the word
``gold'' should be preceded by a designation of the karat
fineness.100
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\100\ Canada (209) suggested, at p.4, that gold plated articles
``be prohibited from using the quality mark `karat'* * *'' because
such use confuses the consumer as to the value of the article. In
fact, the current Guides (in Secs. 23.5(b)(5) and (c)(3)) appear to
prohibit a quality mark on gold electroplated items. However, a
designation of karat fineness has been recommended in the Guides for
mechanically plated articles for many years, and Commission staff is
not aware of complaints from consumers who were deceived by this
representation. No other commenters suggested that the Guides advise
against the use of a quality mark on mechanically plated items.
Hence, the revised Guides, in Secs. 23.4(b)(5) and (c)(3), continue
to recommend that items identified as mechanically plated contain
quality marks.
---------------------------------------------------------------------------
Section 23.5(b)(4) states that certain terms (``gold-filled,''
``rolled gold plate,'' ``rolled gold plated,'' ``gold overlay,'' ``gold
plated,'' or ``gold plate'') should only be used for mechanically-
plated items (i.e., not gold electroplate) and that the gold on these
items should be of ``such thickness and extent of coverage that the
terms will not be deceptive.'' It also states that the karat fineness
should be included with these terms. The safe harbor provision in
Sec. 23.5(c)(2) states that these terms are not deceptive when used for
mechanically-plated items if the karat fineness is stated and the gold
is of ``substantial thickness'' and constitutes 5% of the weight of the
item. Section 23.5(c)(2) also creates a safe harbor for all these terms
except ``gold filled'' when the gold weight is less than 5% if they are
preceded by a fraction indicating the gold weight (e.g., \1/40\ 12 Kt.
Rolled Gold Plate). ``Gold filled'' is reserved for items with a gold
weight of 5% or more.101
---------------------------------------------------------------------------
\101\ The Watch Band Guides contain almost identical provisions
for mechanically plated watch bands, but they contain a section
(Sec. 19.2(e)(2)) entitled ``Examples of Proper Markings for
Expansion Bands of Specified Composition and Construction.'' The
main point made by the ``Examples'' is that quality marks on gold-
filled portions of a watchband should not imply that base metal
portions of the band are gold. The Commission believes the section
of the current Jewelry Guides dealing with quality marks (Sec. 23.8)
adequately addresses this issue. See discussion of quality marks,
infra. Therefore, the Commission is not including the ``Examples''
in the revised Guides.
---------------------------------------------------------------------------
The JVC proposed adding a note to Sec. 23.5(c)(2) of the current
Guides, stating ``The actual gold content of gold-filled and rolled
gold plate articles shall not be less than the gold content indicated
by the quality mark by more than ten percent.'' Only three comments
addressed this issue, all opposing the provision.102 Section
23.5(d) of the current Guides provide that ``the requirements of this
section relating to markings and descriptions of industry products and
parts thereof are subject to the tolerances applicable thereto under
the National Stamping Act (15 U.S.C. 294, et seq.) * * *.'' The
National Stamping Act provides that, for articles made of gold, ``the
actual fineness * * * shall not be less by more than three one-
thousandths parts than the fineness indicated by the mark * * *.'' 15
U.S.C. 295 (1993). No reason was offered for the much larger, proposed
tolerance. Accordingly, the Commission has not adopted this
change.103
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\102\ NACSM (219) p.24; Leach (258) p.9 (stating that the
tolerance is ``by far too liberal''); Korbelak (27) p.4 of attached
letter of April 23, 1982 to Susanne S. Patch (stating that the
proposal is ``unsupportable'' and ``contrary to the spirit of the
recent amendment of the Marking Act which tightened tolerances on
karat goods''). [The National Stamping Act was amended in 1976.]
\103\ A ten percent tolerance is found in Voluntary Product
Standard PS 67-76, ``Marking of Gold Filled and Rolled Gold Plate
Articles Other than Watchcases.'' The tolerance is apparently meant
to apply to weight claims, such as ``10% 14 karat gold''.
This standard is referred to in the current Guides
[Secs. 23.5(d) and 23.5(f) (as ``Commercial Standard CS 47-34'')]
with respect to the exemptions applicable to the tolerance when a
test for metal content is being performed (e.g., excluding ``joints,
catches, screws'' etc.) Other Voluntary Product Standards are also
referred to in the current Guides for the same reason (i.e., a list
of parts of jewelry exempt from assay.) The JVC recommended
including in the Guides the full text of all five Voluntary Product
Standards for precious metals that are referred to in the current
Guides as ``Commercial Standards.'' Commercial Standards were
promulgated by the U.S. Department of Commerce and administered by
the National Bureau of Standards (``NBS''). Later renamed by the NBS
as Voluntary Product Standards (``VPS''), they had the same legal
significance as FTC guides. The Department of Commerce and the NBS,
which is now called the National Institute of Standards and
Technology (``NIST''), withdrew these and all other VPS, as an
economy measure, on January 20, 1984. The JVC proposed preserving
the material in the VPS by incorporating it into the Jewelry Guides.
Only one comment addressed the issue of whether to include the
VPS in the Guides. The Gold Institute (13) agreed that the VPS
should be incorporated, but gave no reasons. The Commission has
included the material pertaining to exemptions from assay (with some
changes, discussed infra) in the Appendix. However, the Commission
has concluded that it is not necessary to include other portions of
the VPS. The VPS state the standards that must be met for each
product, if the product is represented to be in compliance with the
VPS. However, the VPS have been withdrawn so such a representation
is obsolete.
---------------------------------------------------------------------------
Section 23.5(b)(5) states that the terms ``gold electroplate'' or
``gold electroplated'' can only be used when the plating ``is of such
karat fineness, thickness, and extent of surface coverage that the use
of the term will not be deceptive.'' The safe harbor provision in
Sec. 23.5(c)(3) states that these terms are not unfair or deceptive
when used for items with a coating of seven millionths of an inch of
fine (24 karat) gold, or the equivalent. [If the gold coating is, for
example, 12K (half as fine), the coating should be 14 millionths of an
inch thick (twice as thick).] ``Heavy gold electroplate'' may be used
for a coating equivalent to 100 millionths of an inch of fine gold.
This subsection also states that the terms ``gold flashed'' or ``gold
washed'' may be used to describe an electroplated coating that is
thinner than seven millionths of an inch of fine gold or its equivalent
(the minimum thickness for the use of the term ``gold
electroplate'').104
---------------------------------------------------------------------------
\104\ The Postal Service (244) p.2, commented that the use of
``gold flashed'' or ``gold washed'' is misleading to consumers,
particularly where items are ordered by mail and not seen by the
consumer until after purchase. However, the terms ``gold flashed''
and ``gold washed'' have been in common use for many years. The
Commission does not have sufficient evidence at this time to advise
against the use of these terms in all circumstances.
---------------------------------------------------------------------------
The FRN sought comment on how ``gold plate'' should be defined in
the Guides. (As noted, current Sec. 23.5(b)(4) allows ``gold plate'' to
be used to describe only mechanically plated items.) Six comments
opposed allowing
[[Page 27187]]
electroplated items to be described as ``gold plate.'' 105 Most
gave no reason other than stating that there should be a distinction
between products that are mechanically plated and those that are
electroplated.
---------------------------------------------------------------------------
\105\ Gold Institute (13) p.2 (defining ``gold plate'' as an
optional term to describe a mechanically plated article); Handy
(62); Newhouse (76); Mark (207); MJSA (226) p.4 (limiting ``gold
plate'' to mechanically plated articles is ``generally consistent
with terminology used in the trade''); and Knight (256) p.2 (stating
that consumers know electroplate is inferior to mechanically plated
gold).
---------------------------------------------------------------------------
Twelve commenters favored letting electroplated items be designated
as ``plate.'' 106 Sheaffer noted that ``gold electroplate,'' the
designation currently advised by the Guides, is too lengthy for many of
its products and is unknown to consumers in foreign countries, who are
familiar with the term ``plate.'' 107 Sheaffer stated that most
foreign countries permit ``plate'' or ``plated'' to be used to describe
an article coated with gold, regardless of the method of application,
and that a change in U.S. requirements would allow them to stock
inventory of items marked as ``gold plate.'' Further, one commenter
interviewed by Commission staff stated that some manufacturers would
like to market items that are the product of both mechanical plating
and electrolytic plating, that could be labeled ``gold plate.''
108
---------------------------------------------------------------------------
\106\ Fasnacht (4) p.1 (stating that ``gold plate'' has
historically been used in the trade ``for any application of a karat
gold to a base''); Benrus (22); Estate (23); Korbelak (27) p.3
(stating that the trade now uses ``gold plate'' to mean gold applied
electrolytically); G&B (30); ArtCarved (155); LaPrad (181); Matthey
(213); Bruce (218) p.7 (stating that the trade now uses the term
``gold plate'' to mean gold applied electrolytically); Citizen (228)
p.3 (stating that the term should not ``be restricted to any
particular method of applying the gold covering'' and noting that
``the vast majority of gold coverings are applied
electrolytically''); Sheaffer (249); and Leach (257). Four of these
(Fasnacht, G&B, Matthey, and Estate) stated that the method should
be disclosed.
\107\ Comment 249, p.2. Section 23.5(c)(2) states that
``adequate abbreviations'' are not unfair or deceptive for
mechanically plated gold, which is also referred to as ``gold
filled'' and abbreviated as G. F. Section 23.5(c)(3) makes no such
provision for electrolytically plated gold. Moreover, in an advisory
opinion issued in 1971, the Commission stated that ``gold
electroplate'' could not be abbreviated. Advisory Opinion,
Designation of gold content on ball point pens, 79 F.T.C. 1052
(1971). However, the Commission currently has no information that
consumers would understand abbreviations for mechanically plated
gold but not for electrolytically plated gold. Thus, the Commission
has revised the Guides to state that adequate abbreviations are not
unfair or deceptive for electrolytically plated gold (e.g., 12 Kt.
G. E. P.). Therefore, the advisory opinion is withdrawn.
\108\ Matthew Runci from MJSA.
---------------------------------------------------------------------------
Some comments stated that the relevant issue for consumers is
durability, and not the method of plating. Sheaffer stated that ``[t]he
normal consumer is totally unconcerned about the process which a
manufacturer might use to apply gold or silver plate to an article so
long as the precious metal plate meets all appropriate required
standards.'' 109 Canada commented that ``gold plate'' is ``simply
a layer of gold placed over a base substance'' and that the ``important
reference should inform the consumer of the thickness of the plate.''
110
---------------------------------------------------------------------------
\109\ Comment 249, p.3 (noting that ``silverplate'' is allowed
under the current Guides regardless of the method of application and
that this has not misled consumers).
\110\ Comment 209, p.4.
---------------------------------------------------------------------------
Although the comments indicate that there are differences of
opinion in the industry regarding industry custom and usage of the term
``plate,'' under the current Guides the term ``gold plate'' can only be
used for mechanically plated gold. Historically, mechanically plated
gold has contained a thicker coating of gold and has been more durable
than gold electroplate, both because it was thicker and because it was
less porous.
However, the comments indicate that electroplating has been
significantly improved in recent years.111 Other comments indicate
that gold electroplate could now be as desirable, or more desirable,
than mechanically plated gold.112 Commission staff conducted
telephone interviews of seven commenters, who, with one exception,
indicated that gold electroplate can be made as thick and as durable as
mechanically plated gold.113 Furthermore, all of the commenters
whom Commission staff interviewed stated that mechanically plated gold
has usually been marketed as ``filled gold,'' ``rolled gold,'' or
``gold overlay'' (instead of ``gold plate'').
---------------------------------------------------------------------------
\111\ Benrus (22) p.2 (stating that ``The science of gold
plating has improved greatly in the past 15 years and the
requirements in the current Guides . . . are simply not in tune with
today's technology or market practices''); Alan Foster,
``Electrodeposited and Rolled Gold,'' Gold Bulletin 64 (1982),
attached to comment 27 (indicating that the electroplating of gold
was greatly improved about 30 years ago). Korbelak (27) (attached
letter of April 23, 1982 to Susanne S. Patch) states that the
current Guides ``perpetuate an economic advantage to one method of
manufacturing [mechanical] over another.''
\112\ Catholyte (34) p.1 (stating that when corrosion is the
quality criterion, ``mechanically cladded material is not the
present day choice because machining processes which produce the
desired designs will destroy the starting clad stock and yield `raw'
or cut edges which will have little or no clad matter present. (This
procedure necessitates the use of electroplate to `cover' those
edges which are exposed.)''). Other comments indicate that
mechanically plated gold normally has a surface coating of
electroplate. Korbelak (27) (see articles attached to comment); Tru-
Kay (196) p.1 (stating that its major product was mechanically-
plated jewelry, and noting the existence of ``the surface coating of
gold electroplate'' on gold filled items); Mark (207) p.3 (owned and
operated a gold-filled manufacturer and distributor for 25 years and
referred to the ``surface coating of gold electroplate'' on gold
filled (i.e., mechanically-plated) items).
\113\ Matthew Runci, Executive Director, MJSA (226); George
Knight, former president of the Gold Filled Manufacturers
Association (256); Irving Ornstein, Vice President, Leach & Garner
(258); Howard Solomon, Vice President, Donald Bruce & Co. (218);
I.L. Wein, President, Benrus (22); Barry Sullivan, President,
ArtCarved (155); Kenneth Genender, U.S. Watch Council (118). Only
Mr. Knight stated that gold electroplate is inherently inferior to
mechanically plated gold.
---------------------------------------------------------------------------
Based on the comments, the Commission has determined that the
current Guides reflect the now-outdated belief that gold electroplate
is inherently inferior to mechanically plated gold. The Guides may thus
unfairly give mechanical plating a competitive advantage and may make
international trade more difficult. Further, the comments indicate that
the term ``gold plate'' has not been used extensively for mechanically
plated items, and therefore, consumers may not expect an item labeled
as ``gold plate'' to have been mechanically plated. Moreover, the
Commission agrees with the comments that state that consumers are
unlikely to distinguish between products on the basis of the method of
plating used and are more concerned with the durability.114 Thus,
the distinction between mechanically plated and electroplated products
no longer serves a useful purpose. Therefore, the Commission has
concluded that the term ``gold plate'' would not be inherently
deceptive when applied to electroplated items with a sufficient layer
of gold that assures reasonable durability. This will allow products
composed of a combination of types of plating, or newer methods of
plating that are developed, to be called ``gold plate.''
---------------------------------------------------------------------------
\114\ Consumers can determine for themselves whether they like
the appearance of the product, but the consumer has no way of
determining durability.
---------------------------------------------------------------------------
For these reasons, the Commission has created a safe harbor that
would allow ``gold plate'' to be used for gold applied by any process
so long as the coating is sufficiently durable to satisfy consumer
expectations that the plated product would retain its appearance for a
reasonable period of time.115 The Commission believes that a
standard based on thickness, rather than weight of the gold coating, is
more relevant to
[[Page 27188]]
consumer expectations.116 For the reasons discussed below, the
Commission has established a safe harbor for products with a minimum
thickness of one half micron of gold coating.
---------------------------------------------------------------------------
\115\ Although the evidence indicates that the term ``gold
plate'' has not been frequently used, because plating generally has
been in use for many years, consumers reasonably would expect a
certain minimum level of durability from an item so labeled. The
Commission believes it is appropriate to create a safe harbor with a
numerical standard for a specific term such as ``gold plate'' when
consumers would expect certain qualities from products described by
the term and products at or above the standard would have such
qualities.
\116\ Sheaffer (249) p.4 (stating that a standard based on a
weight ratio (e.g., 1/20th) can ``encourage the production of
inferior articles lacking strength and rigidity as the thickness,
and thus, the cost of the plate can readily be reduced by use of a
very thin base material''). But cf. AWA (236) p.2 (in discussing
``gold flashed'' watches, stating that thickness ``is only one
factor in determining the esthetic qualities and durability of the
electroplating process,'' that different technologies produce
varying thicknesses, all of which provide durable coverage, and that
establishing a threshold standard for ``gold flashed'' or other
similar terms creates an arbitrary standard that distorts the
marketplace); and NAW (251). However, because of the other comments
discussed in the text, the Commission believes that identifying a
minimum thickness and fineness is appropriate for a safe harbor for
``gold plate'' claims for jewelry.
---------------------------------------------------------------------------
In developing this safe harbor, the Commission has considered the
standard for gold plated jewelry established by the International
Organization for Standardization (``ISO''): ``ISO International
Standard 10713 Jewellery [sic]--Gold alloy coatings.'' 117 This
standard sets a minimum thickness of half a micron of fine gold (or its
equivalent) for both mechanically plated and electrolytically plated
gold jewelry.
---------------------------------------------------------------------------
\117\ The Trade Agreements Act of 1979 states that federal
agencies must, in developing standards, ``take into consideration
international standards and shall, if appropriate, base the
standards on international standards.'' 19 U.S.C. 2532(2)(A) (1980).
A ``standard'' is defined as ``a document approved by a recognized
body that provides, for common and repeated use, rules, guidelines,
or characteristics for products or related processes and production
methods, with which compliance is not mandatory.'' 19 U.S.C.
2571(13) (1995). An international standard is defined as a standard
promulgated by an organization engaged in international standards-
related activities, the membership of which is open to
representatives, whether public or private, of the United States and
all members of the World Trade Organization (``WTO''). 19 U.S.C.
2571(5), (6), and (8) (1995). A WTO member is ``a state or separate
customs territory (within the meaning of Article XII of the WTO
Agreement), with respect to which the United States applies the WTO
Agreement. 19 U.S.C. 3501(10) (1995).
ISO is, according to the ``foreword'' sections in several ISO
standards attached to the Swiss Federation comment (232), ``a
worldwide federation of national standards bodies. The work of
preparing International Standards is normally carried out through
ISO technical committees.'' ISO is open to representatives from the
United States and to representatives from members of the WTO, and
qualifies as an international standards organization.
However, the Trade Agreements Act also explicitly states several
reasons why basing a standard on an international standard may not
be appropriate, including the prevention of deceptive practices and
fundamental technological problems. 19 U.S.C. 2532(2)(B)(i).
---------------------------------------------------------------------------
The Commission also considered the ISO standard for gold plated
watches, which sets a minimum thickness standard of 5 microns, and
comments submitted as to the current standard in the Watch Guides, to
determine a sufficiently durable coating of gold for plated jewelry.
Watches have historically been assumed to be subjected to more wear
than other articles of jewelry.118 The comments that address gold-
plated watches indicate that a one micron thickness may be durable.
Benrus commented that thicknesses of up to \1/2\ micron ``are
unsubstantial and wear very quickly'' but that there is ``a new
industry `standard' of a minimum of 1 micron of gold plating (40
millionths of an inch) which has substantial durability and reliability
and gives years of satisfactory service.'' 119 The U.S. Watch
Council also noted that the watch industry has adopted 1 micron of
thickness (described as 40 millionths of an inch of 23 karat gold) as a
standard for gold plating.120 Two commenters interviewed by
Commission staff, Benrus and U.S. Watch Council, stated that watches
with a one micron coating of gold, if worn every day, could be expected
to last between two and four years.
---------------------------------------------------------------------------
\118\ This is reflected in the current Guides. Watches marked
``gold electroplate'' should be plated with at least three-fourths
one thousandths of an inch of 10 karat gold (or 750 millionths of an
inch) whereas jewelry should be plated with at least 7 millionths of
an inch of 24 karat gold or the equivalent.
The American Watch Association (236) stated at p.1, that
standards for gold plating should be similar for watches and jewelry
because ``consumers can be confused when faced with jewelry and
watch products subject to entirely different definitions and
standards.'' However, watches may be subjected to more wear than
most jewelry (because they are usually worn daily), and, based on
past practice, consumers may expect watches to have a thicker
coating of gold plate than jewelry. Moreover, there are different
ISO standards for plated jewelry and plated watches.
\119\ Other commenters interviewed by Commission staff stated
that \1/2\ micron was not very durable [Irving Ornstein from Leach
(257); Kenneth Genender from U.S.W.C. (118)]. Catholyte, (34) p.1 (a
``quality'' product would contain 5 microns).
\120\ Benrus (22); USWC (118).
---------------------------------------------------------------------------
Because most jewelry gets less wear than watches, the Commission
believes that the ISO standard of half a micron of fine (24 karat) gold
plating for jewelry constitutes a ``floor'' of sufficient durability,
so that consumers are unlikely to be misled about the durability of an
item marked ``gold plate.'' However, the Commission recognizes that
some commenters indicated that half a micron is not very durable. Also,
certain items of jewelry receive more wear than others, and some items,
such as rings, might actually receive more wear (and more friction with
skin) than watches.121
---------------------------------------------------------------------------
\121\ Telephone interview with I. L. Wein, President, Benrus.
Bruce (218), in discussing vermeil (which is gold plate over
sterling silver), stated that one micron of plating would be
sufficient for some items such as earrings, two microns for other
such as necklaces, but that an item like a ring would require three
microns.
---------------------------------------------------------------------------
Therefore, to ensure that consumers are not deceived by the implied
claims of durability arising from the term ``gold plate,'' the ``safe
harbor'' in the revised Guides (Sec. 23.4(c)(2)) reflects the
Commission's view that the term ``gold plate'' is not inherently
deceptive or unfair when used for gold applied to an industry product
(excluding watches) by any process so long as the following two
conditions are met: (1) The product contains a coating of half a
micron, or 20 millionths of an inch, of fine gold or the equivalent;
and (2) The coating is ``of substantial thickness,'' 122 which for
items that are subject to a great amount of wear, such as rings, should
be more than half a micron of fine gold or the equivalent. This second
provision ensures that products that are subject to greater wear should
have a coating of greater thickness than the minimum half micron.
Moreover, it ensures that products that are subject to a great amount
of wear in certain areas would have a more substantial coating in those
areas.
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\122\ ``Substantial thickness'' is defined in a footnote which
is similar to the present footnote 1 in the current Guides.
---------------------------------------------------------------------------
The Commission has indicated that the thickness of the gold plating
may be marked in microns on the item itself if it is followed in close
proximity by a gold quality mark (e.g., 2 microns 12 K. G. P.). A note
following this section recommends that if a product has a thicker
coating in some areas than others, the area of least thickness should
be marked. This allows manufacturers to inform consumers of the minimum
thickness of the plating, and consumers may therefore shop for items
with more or less plating depending on their needs and budget.
The ISO standard, in section 5.4, prohibits quality marks on gold
plated items. However, the Commission does not believe it is
appropriate to include this portion of the international standard in
the revised Guides. The quality mark in combination with an indication
of the thickness of the gold plate, can communicate important
information to consumers. The ISO standard also sets up a system
whereby gold plated products can be labeled ``A,'' ``B,'' or ``C,''
with A indicating products that have a minimum of 5 microns of 14 karat
gold (or the equivalent), B indicating a minimum of 3 microns of 14
karat gold (or the equivalent), and C indicating a half micron of 24
karat gold (or the equivalent). However, American
[[Page 27189]]
consumers are not familiar with this system, and the Commission does
not believe it is appropriate to include it in the Guides at this
time.123
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\123\ ISO standard 17013 also provides a similar system of
marking mechanically plated gold items (e.g., ``A'' indicates a
thickness of 5 microns), based on the thickness of the gold plate.
However, the Guides allow marking of mechanically plated items
(e.g., gold-filled or rolled gold plate), based on the weight of the
gold in the item. The current system in the Guides has been used for
many years and the ISO system of marking may be confusing to
consumers. Thus, the Commission has not included the ISO system in
the revised Guides. The Commission believes that omitting the ISO
system of marking mechanically plated gold from the Guides will not
pose a barrier to international trade, because manufacturers can
mark the product ``gold plate'' according to the new provisions for
gold plated items, discussed above.
---------------------------------------------------------------------------
The safe harbor for ``gold plate'' (Secs. 23.4 (b)(4) and (c)(2))
will be in addition to those already contained in the Guides. Thus,
Secs. 23.4 (b)(5) and (c)(3) of the revised Guides indicate that
mechanically plated gold can be called ``gold filled,'' ``rolled gold
plate,'' or ``gold overlay.'' However, items mechanically plated with
gold also can be referred to as ``gold plate,'' in accordance with the
guidance of Sec. 23.4 (c)(2) of the revised Guides. Electroplated items
can be marked as ``gold electroplate'' or ``GEP,'' in accordance with
the guidance of Secs. 23.4(b)() and (c)(4) of the revised
Guides,124 or as ``gold plate,'' in accordance with
Sec. 23.4(c)(2).
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\124\ The JVC petition suggests revising the sections pertaining
to electroplate by substituting the word ``electroplate'' for the
word ``plate'' and ``electroplating'' for ``plating.'' This revision
clarifies that products coated with gold by a process other than
electroplating should not be sold as ``gold electroplate.''
---------------------------------------------------------------------------
c. New methods of plating. The FRN solicited comment on whether
newer methods of plating should be included in the guides and how they
should be addressed. Nineteen comments addressed this issue, and of
this group, only one commenter stated that he was unaware of new
techniques.125 The most frequently mentioned new method was
``electroforming,'' a process in which gold is deposited over materials
that are removed, leaving a hollow item.126 (If all of the foreign
material is removed, the product is not actually plated.) Citizen Watch
(228) described a process called ``ion plating,'' and Sheaffer (249)
described ``vapor deposition,'' ``sputtering,'' and ``electroless
immersion.'' However, Sheaffer stated that these processes could be
handled in the same basic manner as mechanical plating and
electroplating and noted that the terms ``plate'' or ``plated'' should
be available to describe products coated by any of these
methods.127 As discussed supra, the Commission has revised the
Guides to indicate that it is not misleading to describe an item as
gold plate, whatever method is used to apply the gold, so long as it
meets the suggested minimum thickness and fineness standards. The
Commission does not have enough information at this time to provide
more detailed guidance regarding the newer methods of plating.
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\125\ Gold Institute (13); Estate (23); Korbelak (27); G&B (30);
Handy (62); Newhouse (76); Eisen (91); ArtCarved (155); Bales (156);
LaPrad (181); Mark (207); Canada (209); Matthey (213); Bruce (218);
WGC (223); MJSA (226); Citizen (228); Sheaffer (249); and Leach
(257). Leon Newhouse (76), a former executive in the watch industry
who stated that he has been retired since 1971, said he was not
aware of any new techniques. Handy, Mark, Matthey and MJSA stated
the techniques can be adequately dealt with by the existing
provisions in the Guides.
\126\ Bruce (218) (stating that it produces this type of
jewelry); Bales (156) p.8 (stating that such jewelry is often sold
by weight and that ``[m]any times, the manufacturer leaves a
measurable amount of residue inside the shell and weighs it, and
actually sells [it] as gold or silver''); Canada (209) (stating that
the problem of foreign substances left inside plated articles
deserves review). Section 23.5(a) of the Guides makes clear that
overstatement of the quantity of gold in a product is unfair and
deceptive.
\127\ Comment 249, p.3; ArtCarved (155) (stating that ``gold
plate'' should be allowed for all methods). Two comments, Estate
(23) and G&B (30), stated that the method of application should be
revealed, but gave no reasons.
---------------------------------------------------------------------------
d. Nickel in gold-filled jewelry. The FRN solicited comment on
whether the Guides should advise against the use of the term ``gold-
filled'' to describe a product in which nickel is inserted between the
gold-filled item and a surface coating of gold electroplate. The FRN
also asked if it would be acceptable to permit the insertion of nickel
so long as the lessened durability of such an item is disclosed, and
asked what type of disclosure should be made.128
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\128\ The JVC proposed this provision to prevent ``the
occasional expediency, in the manufacturing of finished products, to
`hot nickel' or use some other non-precious electroplating over the
mechanical precious metal surface and then merely to apply a flash
of precious metal electroplating.'' Petition Section 23.5 C(2),
Footnote 2. ArtCarved (155) suggested, at p.3, that ``on some
surfaces nickel serves as a leveling agent.'' Korbelak (27) stated,
at p.4, that ``nickel is apparently used to prevent corrosion of the
unavoidably exposed copper alloy base of the mechanically coated
stock.''
---------------------------------------------------------------------------
Most of those who commented believed that jewelry made in this way
should not be called ``gold-filled.'' 129 Tru-Kay (which stated
that gold-filled jewelry is its major product line) noted that the
insertion of nickel would adversely affect durability and
quality.130 Three comments contended that nickel should not lessen
durability.131
---------------------------------------------------------------------------
\129\ Fasnacht (4); Gold Institute (13); Estate (23); Korbelak
(27); Newhouse (76); Tru-Kay (196); Phillips (204); Mark (207);
Matthey (213); Bruce (218); WGC (223); MJSA (226); and Leach (257).
Two commenters, G&B (30) and Jabel (47), favored allowing the
insertion of nickel with a disclosure, but G&B noted that there may
be a need to ``have a new term.''
\130\ Tru-Kay (196) p.1.
\131\ Handy (62); ArtCarved (155); and Sheaffer (249).
---------------------------------------------------------------------------
Mark stated that if a layer of nickel ``has covered the basic
material, it will show up as soon as any gold surface coloration has
worn through* * *.'' 132 This is particularly important since the
metal color would change from yellow to white. Mark also stated that
``[t]o cover the mechanically bonded layer of gold [with nickel] which
is the essence of the gold-filled product defeats the purpose of the
gold-filled standard to the consumer.'' 133
---------------------------------------------------------------------------
\132\ Mark (207) p.4.
\133\ Id.
---------------------------------------------------------------------------
The Commission agrees with the argument of the majority of the
commenters that a thin wash of gold could wear away and reveal the
nickel. Thus, the use of the term ``gold-filled'' to describe such a
product does not comport with Sec. 23.4(b)(5) of the revised Guides,
which states that the product should contain ``a surface-plating of
gold alloy applied by a mechanical process which is of such thickness
and extent of surface coverage that reasonable durability is assured.''
The Commission has concluded that the use of ``gold-filled'' or other
terms to describe mechanically plated gold covered with nickel that is
washed with gold involves a misleading use of the word ``gold'' because
it does not disclose that this product has only a thin wash of gold
over a surface layer of nickel.134 To clarify this point in the
revised Guides, the Commission has added a provision, Sec. 23.4(b)(6),
that states that such a product should not be described as ``gold
plate'' or ``gold-filled'' unless it contains a disclosure that the
primary gold coating is covered with a base metal, which is gold
washed. Such a product comports with the guidance in the current and
revised Guides for ``gold washed'' or ``gold flashed'' and, if the
seller wished to do so, the seller could so describe it.135
---------------------------------------------------------------------------
\134\ The Commission rendered an advisory opinion on this issue
in 1966, stating that ``a purchaser of such an article would not get
the type of performance expected from gold filled articles because
points of wear would expose the coating of white nickel at a very
early stage and the ornamental value would be seriously reduced.''
Advisory Opinion, Improper Use of terms such as ``gold filled'' or
``rolled gold plate'', 69 F.T.C. 1234 (1966).
\135\ The Gold Institute stated, that ``Nickel is a recognized
skin irritant,'' and urged that the use of nickel in gold jewelry be
prohibited. Comment 13, p.2. Several other commenters took this
position. However, the fact that nickel is a skin irritant would
require the disclosure of its presence in all jewelry, not just
rolled gold jewelry. This was not proposed in the FRN and there is
not an adequate basis at this time for adding such a provision.
---------------------------------------------------------------------------
[[Page 27190]]
e. Provisions relating to vermeil. Vermeil, a product made of
sterling silver with a coating of gold, is a special form of gold
plate.136 The JVC proposed including provisions for vermeil in the
Guides and the FRN solicited comment on whether a recommended minimum
plating of 120 millionths of an inch of fine gold, or its equivalent,
over sterling, was appropriate.
---------------------------------------------------------------------------
\136\ ``Tiffany's Sterling: History and Status,'' National
Jeweler (undated) (attached to Korbelak (22)) (stating that vermeil
is a unique product with a ``silver-gold'' glow, which has been on
the market for a long time). However, no provisions pertaining to
vermeil have ever been included in the Jewelry Guides.
---------------------------------------------------------------------------
Eighteen comments addressed this issue.137 Two comments stated
the proposed standard was not appropriate; one offered no reason and
the other stated that the standard should be up to the
manufacturers.138 Three comments stated that the proposed standard
was thicker than necessary.139 Other commenters offered various
opinions on the proposed standard.140 Most of the other comments
simply said the proposed standard was appropriate but offered no
reasons.
---------------------------------------------------------------------------
\137\ Fasnacht (4); Gold Institute (13); Korbelak (27); G&B
(30); Jabel (47); Handy (62); Newhouse (76); ArtCarved (155); IJA
(192); Tru-Kay (196); Mark (207); Canada (209); Bruce (218); Impex
(219); MJSA (226); Sheaffer (249); Knight (256) and Leach (257).
\138\ Newhouse (76) and Impex (219).
\139\ Korbelak (27) p.4 (stating that ``a floor of 100
millionths of an inch was established by the trade many years
ago''); Tru-Kay (196) p.2 (stating that the proposed standard was
``quite excessive'' and not necessary ``in order to give the
consumer a quality product''); Bruce (218) p.8 (stating that the
proposed standard was ``very heavy'' and noted that ``the nature of
the product and the wear it is subjected to would be a more
appropriate guide for plating thickness''). Bruce (218) suggested
that the proposed standard was appropriate for items such as rings
(which receive a lot of wear) but suggested 40 millionths of an inch
for earrings and pendants and 80 millionths of an inch for bracelets
and neck chains.
\140\ MJSA (226) pp.4-5 (stating that the JVC recommended 120
millionths of an inch simply because it is higher than the 100
millionths of an inch required for heavy gold electroplate); G&B
(30) p.8 (indicating that the point was simply to set some
standard); ArtCarved (155) p.4 (stating that ``if vermeil is the
standard word used for 120 millionths of an inch, this would be
okay''); Canada (209) p.4 (noting that it has a quality mark for
vermeil but has yet to establish a minimum standard for plating).
---------------------------------------------------------------------------
MJSA supported the proposed standard stating that it ``assures an
extremely high level of durability and low porosity.'' However, MJSA
stated that ``it is possible to establish a highly durable coating of
gold over silver at substantially lesser thicknesses,'' and noted that
many manufacturers currently produce such a product.141 In the
Jeweler's Dictionary, modern usage of ``vermeil'' is defined as ``Heavy
gold electroplate over sterling silver * * * or a substantial layer of
karat gold mechanically applied over sterling silver.'' 142 The
current Guides identify the minimum thickness for heavy gold
electroplate as the equivalent to 100/1,000,000ths of an inch of fine
gold.
---------------------------------------------------------------------------
\141\ Comment 226, pp.4-5.
\142\ ``Jewelers' Dictionary'' 253 (3d ed. 1976).
---------------------------------------------------------------------------
The JVC petition indicates that vermeil is susceptible to
discoloration, presumably because the silver might tarnish.143
Because gold itself deters tarnishing, the thicker the coating of gold,
the less likely the underlying silver will tarnish. However, Korbelak
(27) p.4, stated that ``gold coatings are permeated by sulfides in the
average atmosphere up to thicknesses of 10 microns (0.0004 inch).''
Thus, even a gold coating of 120 millionths of an inch (or 0.00012
inch), or about 3 microns would not completely solve this problem.
---------------------------------------------------------------------------
\143\ The JVC recommended the addition of a note that states
that a diffusion barrier (typically of nickel) may be
electrolytically applied, in a thickness of no more than 50/
1,000,000ths of an inch, under the layer of gold.
---------------------------------------------------------------------------
The Commission believes it is appropriate to reference a numerical
thickness in the Guides when consumers have come to expect certain
qualities from products described by the term and products below the
standard would not have such qualities. The comments indicate that
there are items sold as ``vermeil'' that have the qualities consumers
associate with ``vermeil,'' and that have a gold coating of less than
120 millionths of an inch. Furthermore, the definition of vermeil in
the Jeweler's Dictionary is consistent with Korbelak's comment (27)
that many years ago, the trade established a floor of 100 millionths of
an inch for vermeil. Therefore, the Commission has concluded that a
thickness of 100 millionths of an inch, or 2.5 microns, of fine gold is
an appropriate thickness ``floor'' for vermeil.
Because there may be items currently sold as ``vermeil'' that do
not comport with the generally accepted meaning (i.e., gold over
silver), the Commission has added a general provision stating that it
would be unfair or deceptive to describe an article as ``vermeil'' if
it misrepresents the product's true composition. The Commission has
also added a section, 23.5(b), which provides guidance on when a
product may be described as ``vermeil.'' This section states that a
product may be described as ``vermeil,'' ``if it consists of a base of
sterling silver,144 coated or plated on all significant surfaces,
with gold or gold alloy of not less than 10 karat fineness, which is of
substantial thickness and a minimum thickness throughout which is
equivalent to two and one half (2\1/2\) microns (or approximately 100/
1,000,000ths of an inch) of fine gold.'' As with other gold-plated
items (covered in Sec. 23.4 of the revised Guides), ``substantial
thickness'' is defined in a footnote which is similar to the present
footnote 1 in the current Guides.
---------------------------------------------------------------------------
\144\ The comments indicate that the sterling silver base is
part of the common understanding of the term ``vermeil.''
---------------------------------------------------------------------------
With respect to the problem of the tarnishing of the silver base,
the JVC recommended the addition of a note allowing a nickel barrier.
However, the nickel is placed over the silver base, and it is the
silver that distinguishes vermeil from other gold plated items.
Moreover, vermeil is by definition composed completely of precious
metal alloys.145 Although the note indicates that the purpose of
the ``diffusion barrier'' is to prevent premature discoloration, there
was no discussion of the effect a ``diffusion barrier'' over the silver
would have on the unique coloration of vermeil. Moreover, no
explanation was offered for limiting the thickness of the barrier to
50/1,000,000ths of an inch.146 Although there may be a need for
such a barrier, in the absence of adequate information on this issue
(including whether it changes the appearance of the product in a manner
that would be objectionable to consumers), the Commission has
determined not to add this note to the Guides. Instead, the Commission
has added a Note which states that such a product should not be
described as vermeil unless there is a disclosure that the sterling
silver is covered with a base metal, which is gold-plated.
---------------------------------------------------------------------------
\145\ See also Advisory Opinion, Impropriety of description
``14K'' for item not entirely gold, 69 F.T.C. 1212 (1966) (stating
that an earring post with a 14K gold base, electroplated with
copper, nickel and then karat gold, could not be described as 14
karat gold, because it would ``contains substantial electroplatings
of base metals'').
\146\ Franklin Mint (250) p.4 (objecting to the proposal and
stating that their own tarnish testing indicates the need for a
barrier of 150/1,000,000ths of an inch).
---------------------------------------------------------------------------
The JVC petition suggested several other qualifications of the use
of ``vermeil'' that the Commission has not included in the revised
Guides. The petition suggested that the application of the gold must be
either by mechanical bonding or electroplating. However, comments have
indicated that some new methods of application have been developed, and
no reasons were offered
[[Page 27191]]
for excluding those methods. (See infra for a discussion of these
comments.) The JVC also proposed that a vermeil industry product only
be represented by the word `Vermeil' standing alone,147 and
proposed prohibiting use of the words ``gold'' or ``silver'' to modify
``vermeil.'' However, no reasons were offered as to why the terms
``gold vermeil'' or ``silver vermeil'' would be deceptive. The use of
the terms ``gold'' and ``silver'' are covered by other sections of the
revised Guides, and the Commission believes these sections are adequate
to prevent the deceptive use of these terms in connection with vermeil.
---------------------------------------------------------------------------
\147\ Franklin (250), at p.4, objected to the exclusion of
``alternative descriptions and markings . . . such as `sterling
silver electroplated with 24 kt. gold'' and noted that ``no evidence
has been produced that such designations would mislead the public.''
The Commission believes that alternative truthful descriptions of a
vermeil product (e.g., sterling silver electroplated with 24 kt.
gold) are acceptable.
---------------------------------------------------------------------------
Finally, the JVC suggested including a requirement that when
``vermeil'' is used as a quality mark, it must be accompanied by the
name or trademark of the manufacturer or importer according to the
provisions of the National Stamping Act. The National Stamping Act
creates such a requirement for any quality mark indicating the presence
of gold or silver. Thus, the requirements of the Act may apply to a
``vermeil'' quality mark. However, there is currently a Note in the
Guides, following the section dealing with quality marks, referring to
the requirements of the National Stamping Act. Instead of creating a
second note, the Commission has added ``vermeil'' to the list of
quality marks in that Note (and in Sec. 23.9 of the revised Guides).
3. Misrepresentation as to Silver Content: Sec. 23.6
Section 23.6(a) of the current Guides cautions against
misrepresenting the silver content in any industry product. The JVC
proposed adding the abbreviation ``Ster.'' to Sec. 23.6(b) of the
Guides, which states that the use of the terms ``silver,'' ``solid
silver,'' ``Sterling,'' or ``Sterling Silver'' is deceptive unless the
product is 925/1000ths pure silver. Because consumers are likely to
believe this term stands for ``Sterling,'' the Commission has added the
abbreviation ``Ster.'' to this section.
The JVC proposed stating that abbreviating the term ``Sterling''
was not allowed when used to describe hollowware or flatware. No reason
was offered for prohibiting this practice, and the Commission has no
reason to conclude that this practice is inherently unfair or
deceptive.148 The JVC also proposed stating that ``Sterling'' or
``Ster.'' was not allowed to be applied to a silverplated article. This
proposed addition to Sec. 23.6(b) essentially restates Sec. 23.6(d) of
the current Guides, which states that it is unfair to apply the terms
``Sterling'' or ``Coin'' to any silver-plated article or the plating
thereon. In fact, the National Stamping Act states that silverplated
articles shall not ``be stamped, branded, engraved or imprinted with
the word `sterling' or the word `coin,' either alone or in conjunction
with other words or marks.'' 15 U.S.C. 297(a). However, the Commission
has determined that Sec. 23.6(d) of the current Guides may
unnecessarily inhibit the use in advertising of phrases such as
``sterling silver plated'' or ``coin silver plated.'' Thus, the
Commission has deleted Sec. 23.6(d) and has added a Note referring to
the requirements of the National Stamping Act.
---------------------------------------------------------------------------
\148\ Franklin (250) commented at p.5, that the presumption
implicit in allowing sterling to be abbreviated on other products
``is that buyers of the other products named therein for which
`ster.' is an acceptable usage understand its meaning; it defies
logic to assume that the term `ster.' is not recognized and
understood by the hollowware and flatware buying public.''
---------------------------------------------------------------------------
Section 23.6(c) states that the use of ``coin'' is deceptive unless
the product is at least 900/1000ths pure silver. The JVC proposed
adding a prohibition against abbreviating the term ``coin.'' There is
no evidence that ``coin'' is being abbreviated or, if it were, that it
would be misleading to consumers. Accordingly, the Commission has not
adopted this proposal.
a. Silverplate. Section 23.6(e) of the current Guides state that it
is an unfair trade practice to represent an industry product as plated
with silver unless all significant surfaces are coated with silver
``which is of substantial thickness.'' 149 The JVC proposed
continuing the use of the ``substantial thickness'' standard but adding
a footnote stating this means thickness sufficient to assure durable
coverage of the base metal. (The current Guides contain such a footnote
in Sec. 23.5(c)(2) with respect to gold-filled items.) The FRN
solicited comment on whether this addition should be made or whether
the thickness should be defined numerically.
---------------------------------------------------------------------------
\149\ The Watch Band Guides differ from the Jewelry Guides in
that they state that when an industry product is marked as ``silver
plate'' all significant surfaces ``shall have a plating or coating
of silver of a high degree of fineness and such plating or coating
shall be of substantial thickness.'' 16 CFR 19.2(b) (emphasis
added). The Jewelry Guides simply state that such a product should
contain a ``plating or coating of silver which is of substantial
thickness.'' The Jewelry Guides state that ``silver'' means sterling
silver (i.e., unless qualified by the word ``coin''). Thus, the
Jewelry Guides appear to limit the use of ``silver plate'' to
sterling silver plate, whereas the Watch Band Guides appear to allow
coin silver to be used on an item marked ``silver plate.'' Because
no one objected to the current provision in the Jewelry Guides, the
Commission has retained the provision as it appears in the Jewelry
Guides for both jewelry and detachable watch bands.
---------------------------------------------------------------------------
All but one of the 16 pertinent comments indicated that giving a
numerical value to ``substantial thickness'' would be
desirable.150 However, four of these suggested that additional
data were needed.151 Moreover, only a few made specific
recommendations. Sheaffer noted that it was ``not aware of any problems
resulting from the current definition of `substantial thickness''' but
nevertheless proposed a coating five microns (200 millionths of an
inch) thick. Mr. Korbelak suggested 500 millionths of an inch where it
is functionally necessary.152
---------------------------------------------------------------------------
\150\ Gold Institute (13); Korbelak (27); G&B (30); Handy (62);
Newhouse (76); ArtCarved (155); Bales (156); Phillips (204); Canada
(209); Bruce (218); MJSA (226); Sheaffer (249); and Leach (257). The
one dissenter was the JCWA (216), which stated at p.3 that ``there
is insufficient data to determine an `acceptable' thickness of
silver plating, and because related ISO standards have not been
established, it is difficult to determine the durability of specific
levels of silver plating. Therefore, it is not practical to define
`durability' in numerical terms. The existing definition is
appropriate.''
\151\ G&B (30); Handy (62); Canada (209); and MJSA (226).
\152\ Sheaffer (249) p.4; Korbelak (27) p.4.
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The Gold Institute made detailed recommendations, but only for
silver plated flatware and hollowware.153 However, without more
evidence of the need for, and desirability of, these particular
standards, the Commission does not believe it is appropriate to adopt
specific standards for flatware and hollowware. Moreover, the amount of
wear received by jewelry is different from the amount of wear received
by flatware and hollowware. Therefore, the proposed standards for
flatware may not be appropriate for jewelry. Indeed, the amount of wear
received by different kinds of jewelry varies greatly (e.g., earrings
as compared to bracelets) and manufacturers may need flexibility in any
silver plate standard for jewelry.
---------------------------------------------------------------------------
\153\ Comment 13, pp.2-3.
---------------------------------------------------------------------------
Based on the comments, the Commission does not believe that there
is currently a consensus in the industry as to what would constitute an
appropriate minimum numerical thickness for the purpose of identifying
a safe harbor for the term silverplate.154 However, the Commission
has added a note to Sec. 23.6(e) to provide some guidance to the
industry regarding ``substantial thickness'' in connection
[[Page 27192]]
with the use of the term silverplate. This note is similar to footnote
1 in the current Guides, which annotates the use of the phrase
``substantial thickness'' in connection with ``gold plate.''
---------------------------------------------------------------------------
\154\ There is no ISO standard for silverplate.
---------------------------------------------------------------------------
Finally, the JVC recommended adding a section to the Guides that
would allow items with an inner core of base metal to be referred to as
sterling or coin (instead of silverplate) as long as the item as a
whole contained 925 or 900 parts silver per thousand. A literal reading
of the sections of the current Guides pertaining to sterling and coin
[Secs. 23.6 (b) and (c)] indicates that this practice is not currently
perceived as misleading. However, the actual practice in most of the
industry is only to label an item sterling if it is a uniform mixture
throughout of 92.5% silver and a base metal (or, for coin, 90% silver
and the rest base metal). Without more information as to consumer
beliefs, the Commission is not adopting this specific provision at this
time.
b. Diffusion barrier on sterling silver. The JVC recommended adding
a note to the Guides that states that a diffusion barrier (typically of
nickel) may be electrolytically applied, in a thickness of no more than
50/1,000,000ths of an inch, under a layer of rhodium, to deter
premature tarnishing on sterling silver products.\155\
---------------------------------------------------------------------------
\155\ Rhodium, a member of the platinum group metals, is very
hard.
---------------------------------------------------------------------------
Although this note refers to ``sterling silver products,'' it
follows the section on silver plate, and it is unclear whether this
note is meant to apply to sterling silver products or silver plated
products or both. In either event, the described product would have no
silver on the surface, and thus, strictly speaking, it would not fall
within the definitions in the Guides of either sterling silver or
silver plate. John Lutley, Executive Director of the Silver Institute
and President of the Gold Institute, stated, ``[s]ome jewelry
manufacturers plate pure silver over a nickel flash on sterling silver
to achieve a mirror finish and reduce the rate of tarnishing.'' \156\
This may be the practice the note was designed to address. However, in
the absence of adequate information on this issue (e.g., how such
products are described to consumers), the Commission has not included
this Note in the revised Guides.
---------------------------------------------------------------------------
\156\ Comment 13, p.2.
---------------------------------------------------------------------------
c. Quality marks. The JVC proposed adding three subsections dealing
with quality marks. Two subsections [23.6 Section I(g) and I(h) in the
JVC petition] reiterate the general provisions concerning the use of
the terms ``Sterling,'' ``Ster,'' ``Sterling Silver,'' ``Silver,'' or
``Solid Silver'' and ``Coin'' or ``Coin Silver,'' set out in
subsections (a), (b), and (c) of the silver section. Therefore, the
Commission is not restating these provisions in another section.
The third proposed section dealing with quality marks [section 23.6
Section I (i) of the JVC petition] states that no quality marks shall
be used ``other than those herein specified.'' The Franklin Mint
commented that this ``inexplicably prohibits use of such universally
recognized numerical terms as `.925' in conjunction with other
applicable quality marks such as `ster.' or `sterling.' '' \157\ The
Commission does not believe that a marking such as ``.925 ster.'' is
inherently deceptive, and is not including this proposal in the Guides.
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\157\ Comment 250, p.5.
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d. Tolerances and exemptions for testing purposes. Footnote 2 of
the current Guides notes that the tolerances of the National Stamping
Act are applicable to claims made with respect to silver content. The
JVC suggested reorganizing this information, and the Commission
believes that this change will be helpful to industry members who are
using the Guides. Footnote 2 of the current Guides also refers to the
exemptions recognized in an assay for quality (to determine the amount
of fine silver in the item which is assayed), which are taken from
Commercial Standard CS 118-44 [Marking of Jewelry and Novelties of
Silver] and Commercial Standard CS 51-35 [Marking Articles Made of
Silver in Combination with Gold]. The JVC suggested identifying these
exemptions in an additional subsection. Because the exemptions apply to
both silver and gold, and because the lists of exemptions distract from
the main points of the text of the Guides, the Commission has included
this information as an appendix to the Guides. A Note following the
silver section refers to the Appendix.
4. Marking of Articles Made of Silver in Combination With Gold
The current Guides do not contain a separate section addressing how
products which are a combination of silver and gold can be
nondeceptively described. The JVC proposed including in the Guides most
of the text of Voluntary Product Standard PS 68-76, ``Marking of
Articles Made of Silver in Combination with Gold.'' \158\ The proposed
section defines the covered products as sterling silver in combination
with gold.\159\
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\158\ Footnote 2 in the current Guides references former
Commercial Standard CS 51-35 (``Marking of Articles Made of Silver
in Combination with Gold'') but only to note that it sets out
exemptions from an assay in quality. See discussion, infra,
regarding Commercial Standards generally.
\159\ The VPS provides that articles where the gold and silver
are visually indistinguishable (e.g., where the gold covers the
entire article, or where white gold is combined with silver) may be
marked, e.g., ``Sterling and \1/5\ 10 K,'' where the fraction
represents the proportion of the weight of the alloyed gold to the
weight of the entire metal in the article. It also provides that the
karat mark can only be used if the gold alloy is \1/20\ of the
weight of the entire metal in the article. For articles where the
gold and silver are visually distinguishable, the karat mark must
always follow the Sterling mark, e.g., ``Sterling and 10 K,'' and
there is no requirement that the proportion of the weight of the
alloyed gold to the weight of the entire metal in the article be
disclosed. The JVC also proposed that articles so marked must not
contain any metal other than Sterling silver and 10 karat or better
gold.
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The JVC's proposals, at least in the case of products with
distinguishable components, result in markings that the Commission has
already identified as deceptive.\160\ However, claims as to silver
content are covered by the silver section and claims as to gold content
are covered by the gold section. Furthermore, the marking of articles
which are a combination of silver and gold is adequately addressed by
Sec. 23.8(a) of the current Guides. That section provides that it is
unfair to place a quality mark on a product when the mark would deceive
purchasers as to the metallic composition of the product or any part
thereof. Moreover, subsection (a)(2) notes that, when a quality mark
applies to one part of a product but not another part of a similar
appearance, it should be accompanied by an identification of the part
to which it applies. The JVC offered no evidence regarding why
additional guidance on these issues was needed or that any combination
gold and silver products
[[Page 27193]]
were being marketed in a manner that deceived consumers as to their
metallic content.\161\
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\160\ In an advisory opinion, Marking of jewelry produced from a
14 karat gold sheet laminated upon sterling, 89 F.T.C. 651 (1977),
the Commission stated that the mark ``Sterling and 14K'' was
deceptive as applied to an article in which a 14K gold sheet was
laminated on sterling, and the gold constituted at least 5% of the
weight of the article. The Commission noted that the different
metals were visually distinguishable ``but casual inspection cannot
determine the relative thickness of the gold layer and the silver.''
Id. at 651. The Commission stated that the suggested markings
``could suggest to consumers that the amount of gold and silver. . .
are approximately equal or, at least, would suggest more than five
percent 14K gold.'' Id.
In an advisory opinion involving two visually indistinguishable
metals, Marking of 18 karat white gold ring with platinum baguette
prongs, 74 F.T.C. 1686 (1968), the Commission stated that a white
gold ring with platinum baguettes could not be marked ``18K--10%
Plat.'' The Commission reasoned that ``the consumer might conclude
that all of the prongs, including those for the center stone, are of
platinum composition. Under these circumstances, it is not enough to
merely say that the ring contains 10% platinum and 90% gold without
disclosing the true composition of the various parts of the ring.''
Id. The Commission suggested that the ring could be marked ``18K-
baguette prongs Plat.''
\161\ The Franklin Mint (250) stated at p.4, that there is no
evidence that a gold karat mark is misleading on a gold and silver
item when the gold constitutes less than \1/20\ of the total metal
weight. Moreover, it also noted that the JVC did not propose any
such prohibition for vermeil products, ``which are but another form
of gold and silver item. . . .''
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Finally, the JVC's proposal to permit quality marks only for
sterling and gold items is unduly restrictive. For example, an article
made of coin silver combined with gold could not contain a quality mark
under the JVC proposal, nor could an article which contains any metal
other than sterling silver or gold. For all these reasons, the
Commission has not included in the Guides, the proposed provisions
relating to articles made of silver in combination with gold.
5. Platinum: Sec. 23.7
Section 23.7 of the current Guides states that it is an unfair
trade practice to use the words ``platinum,'' ``iridium,''
``palladium,'' ``ruthenium,'' ``rhodium,'' or ``osmium,'' or any
abbreviations thereof, in a way likely to deceive purchasers as to the
true composition of the product. The JVC and a number of commenters
proposed changes to this section. However, the Commission recently
received a request for an advisory opinion from the JVC and Platinum
Guild International for markings of platinum products. This request
indicated that members of the platinum industry are interested in
simplifying current Commission guidance regarding platinum descriptions
and bringing this guidance into closer accord with international
standards. The comments submitted in response to the FRN do not address
some of these issues. Therefore, the Commission has decided that it
would be beneficial to solicit additional comment from the entire
industry on markings and descriptions of platinum products before
making any changes in this section. A request for comment on these
issues will be published in a separate Federal Register notice.
6. Pewter
The current Guides do not pertain to products made from pewter. The
JVC recommended including a section on pewter and the FRN solicited
comment on whether the guides should include a provision, and whether
the standard of any alloy consisting of at least 900 parts per thousand
Grade A Tin is appropriate.
Thirty comments addressed this issue, and most thought pewter
should be included in the Guides and that the proposed standard was
appropriate. Four opposed the change, stating that the Guides should
only address precious metals.162 One comment stated that there was
no apparent need for regulation of pewter but another stated that there
are ``many companies that are abusing the representation of pewter
products.'' 163
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FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
\162\ Nowlin (109); LaPrad (181); Sheaffer (249); and Leach
(258).
\163\ NACSM (219) p.7; Bales (156) p.9.
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It appears that pewter has been increasingly utilized in costume or
fashion jewelry. Nellie Fischer of the American Pewter Guild advised
staff in a telephone interview that over the past five years her
company's sales of pewter jewelry to the trade have increased by 40
percent.164 Pewter jewelry and other pewter products are sold by
at least some of the same entities that sell other products covered by
the current Guides. The Commission has concluded that inclusion of a
provision for pewter may prevent misrepresentations.
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\164\ Christopher R. Mellott, counsel for the Pewter Guild,
compiles voluntary statistical reports from samplings of pewter
manufacturers and, over the period from 1983 to 1990, found a six-
fold increase in the value at wholesale of pewter jewelry sales.
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With respect to the proposed standard, Salisbury Pewter stated that
``a 90% tin requirement is justified by the metallurgical restraints
for strength and hardness.'' 165 The American Pewter Guild, a
trade association, attached a list of historical references to pewter
which indicate that pewter has virtually always had a tin content of at
least 90%.166 Ten pewter producers also supported the proposed
standard.167
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\165\ Comment 86, p.1.
\166\ Comment 89 (also stating that pewter has been defined as
containing 90% tin in the Guild's By-Laws since their adoption in
1976).
\167\ Stieff (25); Empire (44); Woodbury (64); Lance (84); Web
(85); Salisbury (86); Fischer (87); Seagull (111 and 120); Universal
(178); and Heritage (215). Other comments favoring the proposed
standard for pewter are: Fasnacht (4); Estate (23); G&B (30); Jabel
(47); Bales (156); Canada (209); Bruce (218); MJSA (226); and
Preston (229).
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Because pewter has historically contained at least 90% tin,
consumers presumably expect pewter to have the qualities that are
associated with an alloy containing at least 90% tin. Thus, the
Commission has included a section on pewter in the Guides. Section
23.8(a) states that it is unfair and deceptive to describe a product as
``pewter'' if the description misrepresents the product's true
composition. Section 23.8(b) states that a product may be described as
``pewter'' if it contains at least 90% tin, with the remainder composed
of metals appropriate for use in pewter.
7. Additional Guidance Relating to Quality Marks: Sec. 23.8
The JVC proposed several changes in Sec. 23.8 of the current
Guides. The introductory paragraph of this section defines ``quality
mark'' and gives specific examples of words (e.g., ``gold,'' ``karat,''
``silver,'' etc.) that are considered to be quality marks. (As noted
previously, the Commission has added the word ``vermeil'' to this list
of words that constitute quality marks.) 168
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\168\ The Watch Band Guides differ from the Jewelry Guides with
respect to quality marks in that they list the words duragold,
diragold, noblegold, and goldine as quality marks in Sec. 19.2(g).
However, the Jewelry Guides, in a Note following Sec. 23.8 on
quality marks, reach the same practices by stating that quality
marks ``include those in which the words or terms `gold,' `karat,'
`silver,' `platinum,' (or platinum related metals), or their
abbreviations, are included, either separately or as suffixes,
prefixes, or syllables.'' The Commission has added this sentence of
this Note to the introductory paragraph of this section in the
revised Guides (Sec. 23.9). The Commission does not believe it is
necessary to add the words duragold, diragold, noblegold, and
goldine to the examples of quality marks listed in current
Sec. 23.8.
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Part (a) of this section addresses the use of quality marks on
articles that are made from more than one metal. The JVC suggested that
the title be changed from ``Deception as to applicability of marks'' to
``Deception as to application of marks'' and that a definition of
application be added. The definition of application suggested by the
JVC includes bills, invoices, orders, statements, letters, and
advertisements. However, this definition is inappropriate in the
context of part (a) of this section, which is limited to deception in
the use of quality marks, which do not encompass bills, invoices, etc.
The term ``quality mark'' is defined as a mark ``which has been
stamped, embossed, inscribed, or otherwise placed, on any industry
product and which indicates or suggests that such product is composed
throughout of any precious metal or any alloy thereof or has a surface
or surfaces on which there has been plated or deposited any precious
metal or any alloy thereof.'' 169 Section 23.8 contains specific
guidance for marks on the products themselves
[[Page 27194]]
(or attached thereto). Other sections of the Guides apply to claims
made in bills, invoices, orders, statements, letters, and
advertisements. Thus, the Commission has not included the proposed
definition of application in the Guides.
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\169\ This is consistent with the references to such marks in
the National Stamping Act, which applies to articles ``having
stamped, branded, engraved, or printed thereon, or upon any tag,
card, or label attached thereto, or upon any box, package, cover, or
wrapper in which said article is incased or inclosed, any mark or
word indicating or designed or intended to indicate'' the degree of
fineness of the gold or silver in the article. 15 U.S.C. 294. A
quality mark does not have to be placed on a product, but, if it is,
it must be accurate within the tolerances prescribed by the National
Stamping Act. 15 U.S.C. 294-296. The National Stamping Act goes
beyond embossing quality marks on products to things surrounding the
product (e.g., labels, wrappers), but not as far as bills,
advertisements, etc., as the JVC proposes for the Guides.
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Part (b) of this section addresses deception by reason of the
difference in the size of letters or words in quality marks (e.g., GOLD
electroplate). A Note following this section, entitled ``Legibility of
markings,'' recommends that quality marks be of sufficient size to be
legible and be so placed as to be likely to be observed. The JVC has
not suggested any changes to this section, or to the Note following it.
The Commission agrees that the portion of the Note pertaining to
legibility should remain unchanged.170 However, the second
sentence of the Note implies that quality marks should normally be
engraved on products and that tag or labels can only be used when
``such marking cannot be achieved without injury to the appearance of
the product.'' The National Stamping Act indicates that quality marks
can be applied by means of tags or labels, regardless of whether
engraving would damage the product. The Commission has therefore
modified this Note to clarify the fact that if a quality mark is used,
it may be either engraved on the product or placed on a tag or label.
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\170\ There is no requirement that there be a quality mark;
however, it may be deceptive to place an illegible mark on a
product, because consumers might interpret such a mark to mean the
product is of higher quality than it actually is.
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The second Note following this section currently states that it is
the consensus of the members of the industry that quality marks on such
items should be accompanied by identification of the manufacturer,
processor, or distributor. The Commission has changed this Note to
reference the requirements for identification contained in the National
Stamping Act.171
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\171\ The Watch Band Guides differ from the Jewelry Guides in
their treatment of quality marks in two respects (in addition to
that discussed in note , supra). Section 19.2(g)(3) of the Watch
Band Guides, dealing with the marking of watch bands composed of two
metals of similar appearance, is adequately addressed by
Sec. 23.8(a) of the current Jewelry Guides, discussed above. Section
19.2(g)(1) of the Watch Band Guides provides that if a quality mark
is concealed by packaging, it should appear on the outside of the
packaging if the failure to so display it would deceive consumers.
The Jewelry Guides do not require that products contain quality
marks and, thus, do not require that a quality mark be visible in
spite of packaging. The Commission believes it is neither unfair nor
deceptive to fail to include a quality mark; hence, it is neither
unfair nor deceptive to allow packaging to conceal a quality mark.
Thus, the Commission has not included this provision in the revised
Guides.
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8. Exemptions From Assay
Some functional parts of gold alloy, gold-filled, silver and
platinum items may need to be made of other sturdier metals to function
properly, and thus, are exempt from any assay for quality. (An assay is
a test made to determine the quantity of precious metal in a product
compared to the weight of the whole product.) The current Guides
include the exemptions for these parts that are set out in the various
Voluntary Product Standards. Since trade practice for many years has
been to make such parts of base metals, it is unlikely that consumers
would expect them to be made of precious metal; hence, a claim that an
item was silver would not be deceptive because the screws and rivets
were made of base metal.
The current Guides list the exemptions for gold and gold-filled
items in section 23.5(e) and (f) and for silver and for silver in
combination with gold, in footnote 2.172 However, the Commission
believes that detailed listings of the exemptions need not appear in
the body of the Guides and has included the list of exemptions for all
covered metal products in an Appendix.173
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\172\ The Guides contain no exemptions for products which are
never assayed. This includes products made of gold or silver
electroplate. (Such articles are not sold with the representation
that they contain a specific percent by weight of precious metal.)
\173\ The current Guides use the Appendix to list and classify
the Guides. The JVC proposed placing this material first as a Table
of Contents. The Commission believes that the existing list of
section numbers and titles in the table of contents is sufficient
and has omitted this classification from the revised Guides.
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The list includes all exemptions from the current Guides and, based
on the comments, includes some additions.174 Tru-Kay stated that
there is a significant inconsistency in the Guides between the
exemptions recognized in the manufacture of gold-filled jewelry and
those which are exempted in the manufacture of silver jewelry. Tru-Kay
stated that ``industry trade practice over many years has been to apply
the exemptions as listed for gold-filled to both gold-filled and
sterling silver,'' because the same reasons that certain parts are
exempt in gold-filled jewelry are also applicable in silver
jewelry.175 Tru-Kay explained that when the exemptions were first
written, ``many articles that were being produced in gold-filled, were
not at that time being produced in sterling silver.'' 176 Since
this is no longer the case, Tru-Kay urged that ``these exemptions be
standardized in a consistent manner.'' 177 The Commission agrees
with this proposal and has expanded the list of exemptions for silver
items to include all exemptions listed for gold-filled items.178
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\174\ In addition, because the revised Guides cover items other
than jewelry, the exemptions are stated as applying to industry
products, not to jewelry industry products.
The JVC proposed exemptions from assay for optical products,
which are based on the VPS, with some additions. There were no
comments opposing this proposal, and the Commission has included
this list of exemptions for optical products in the Guides.
\175\ Comment 196, p.2.
\176\ Id.
\177\ Id.
\178\ Silver is relatively soft. Hence, it is logical for the
exemptions for gold-filled items to apply also to silver items.
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General Findings, which makes small functional components of
jewelry, suggested that there should be two additions to the gold
exemptions.179 First, it suggested the exemptions for karat gold
jewelry include ``metallic parts completely encased in nonmetallic
covering.'' This would include base-metal pegs used in gluing pearls or
stones to the findings. (According to General Findings, ``the pegs are
completely encased within the stone or pearl.'') The current Guides
exempt ``metallic parts completely encased in nonmetallic covering''
when they are included in articles made of silver in combination with
gold.180 On the basis of the comment, the Commission has
determined that such parts should be added to the list of exemptions
for gold alloy jewelry (and to the list of exemptions for silver items,
under the rationale advanced by Tru-Kay). The second suggestion was
that ``bracelet and necklace snap tongues, i.e., clasps'' (sometimes
referred to as springs) should be added to the exemptions for rolled
gold plate jewelry. Bracelet and necklace snap tongues are already an
exemption for articles made of platinum, and the Commission has added
this to the list of exemptions for rolled gold plate jewelry (and to
the list of exemptions for silver items).
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\179\ Comment 88, p.1.
\180\ Footnote 2 to current Guides.
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Donald Bruce also suggested that the mechanical parts of lockets be
added to the lists of exemptions for silver and gold alloy jewelry.
These are already in the list of exemptions for gold-filled jewelry
(which exempt ``field pieces and bezels for lockets''), and Bruce
stated that ``the trade practice has interpreted this for Silver and
Gold as well'' because a base metal hinged frame ``offers stability and
strength to the moving parts.'' 181 Adding these to the list of
exemptions for silver is logical because silver is relatively soft.
Gold
[[Page 27195]]
alloy, however, is relatively hard.182 Nevertheless, because trade
practice has interpreted this exemption as applying to gold lockets for
some time, it is unlikely that consumers would believe that the field
pieces and bezels of a locket advertised as 14 karat gold were 14 karat
gold. Therefore, the Commission has added these exemptions to the list
of exemptions of silver and gold alloy products.183
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\181\ Comment 218, p.3.
\182\ As a result, the list of exemptions in the current Guides
is much shorter for gold items than for silver items.
\183\ The following were added to each list of exemptions: (1)
karat gold: metallic parts completely and permanently encased in a
nonmetallic covering, and field pieces and bezels for lockets; (2)
gold-filled: bracelet and necklace snap tongues; (3) silver: field
pieces and bezels for lockets; bracelet and necklace snap tongues;
any other joints, catches, or screws; metallic parts completely and
permanently encased in a nonmetallic covering. There were no
additions to the exemptions for silver in combination with gold or
for platinum.
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9. Misuse of ``Corrosion Proof,'' ``Noncorrosive,'' etc.
The Watch Band Guides, 16 CFR 19.3, contain a section regarding the
use of the terms ``corrosion proof,'' ``noncorrosive,'' ``corrosion
resistant,'' ``rust proof,'' ``rust resistant,'' or any word or term of
equivalent import. The JVC did not recommend any changes in this
section. Thus, the Commission has included this provision, unchanged,
in the revised Guides as the last section pertaining to metals
(Sec. 23.10).
D. Diamonds (Category III): Secs. 23.9-23.14
The current Guides address diamonds in the definition section,
Sec. 23.0, and in Secs. 23.9-23.14. Section 23.9 describes practices
which are unfair uses of the word ``diamond.'' Sections 23.10-23.14
deal with misuse of the terms ``perfect,'' ``blue white,'' ``properly
cut,'' ``brilliant,'' ``full cut,'' and ``clean.'' In addition,
artificial coloring, imitation and synthetic diamonds, and the words
``reproduction,'' ``replica,'' ``gem,'' ``real,'' ``genuine,'' and
``natural'' are addressed in Secs. 23.18-23.21.
1. Definition
The Commission has moved the definition of ``diamond'' from
Sec. 23.0 to the beginning of the substantive sections that deal with
diamonds (Sec. 23.11, which is renamed ``Definition and misuse of the
word `diamond' ''). The JVC proposed adding the following sentence to
the definition of the word diamond: ``It is the hardest natural
substance and in 1818 was arbitrarily given 10 on the Mohs relative
scratch hardness scale.'' The JVC also proposed adding, after the
definition of diamond, a ``Note'' regarding the Mohs scale and the
standards for determining mineral ``hardness.''
A definition of diamond is helpful to the extent that it makes
clear what can nondeceptively be represented to be a diamond. However,
there is no indication that the current definition of diamond has ever
failed to serve its purpose, and some comments indicated the current
definition is better.184 The Commission, therefore, is not
adopting this proposal.
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\184\ AGTA (49) p.15 (commenting that either information should
be added to the proposed JVC definition or the last sentence of that
definition and the following Note should ``be struck,'' adding that
``AGTA prefers that both be struck from the guides''); NACSM (219)
pp.25-26 (stating that the proposed addition to the definition is
``not an improvement on the clarity of the mandates of the law'').
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The Postal Service stated that mail order jewelry promoters sell
``tiny, unattractive, industrial grade diamonds'' as jewelry which ``no
one would buy if they saw them.'' It suggested that the Guides be
modified to prohibit ``advertisers from representing expressly or
impliedly, that industrial or other non-jewelry quality diamonds are of
jewelry quality.'' 185 The Commission agrees that such a practice
is unfair and deceptive, and has included a Note that states the
practice of advertising industrial grade diamonds as jewelry is unfair
and deceptive. The provision advising against misrepresenting products
visually, in Sec. 23.2, also would apply to this practice.
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\185\ Comment 244, p.2.
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2. Misuse of the Word ``Diamond''
Section 23.9 of the current Guides deals with misuse of the word
``diamond.'' Neither the JVC nor any of the commenters proposed a
change in this section, and there is no other information indicating a
need for changing this section.
3. Misuse of the Words ``Perfect'' and ``Flawless''
Section 23.10 of the current Guides, and the accompanying Note,
deal with the use of the words ``perfect'' and ``flawless'' to describe
a diamond. The JVC proposed revising this section to focus on the use
of the term ``flawless,'' with a subsection stating that it is unfair
to use the word ``perfect'' with respect to any diamond which is not
flawless, or which is of inferior color or make. The organization of
the current section is convoluted and difficult to understand. The
Commission has determined that the proposed change will improve the
clarity of the Guides, and has revised this section accordingly.
To determine whether there was evidence that the term ``perfect''
has been used to mislead consumers, the FRN sought comment on whether
the Guides should advise against use of the term ``perfect.'' Thirty-
two comments addressed this issue.
Seven comments indicated that the term ``perfect'' is acceptable as
defined in the current Guides.186 Twenty-eight commenters stated
that the term ``perfect'' should be prohibited, and one stated it
should be allowed only as a synonym for flawless.187 However, the
current Guides allow diamonds to be called ``perfect'' if they are
flawless and not of inferior color or make, and there is no evidence
that large numbers of consumers have been deceived by the use of the
word ``perfect.'' 188 The Commission has determined that the
scheme in the current Guides adequately explains the type of diamond
that nondeceptively may be described as ``perfect'' and that guidance
that in effect totally bars the use of the word ``perfect'' would be an
unwarranted infringement on free speech.189
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\186\ King (11); Estate (23); Lannyte (65); GIA (81); Bales
(156); NACSM (219); and Best (225).
\187\ JMC (1); Fasnacht (4); Sibbing (5); Thorpe (7); Honora
(14) and (15) p.1 (stating that if diamonds can be called perfect,
``it would open vast opportunities for deceptive advertising and
many consumers would be hurt''); Argo (17); AGS (18) p.3 (favoring
the prohibition because ``[t]he potential for misuse is too
great''); Capital (19); Estate (23); G&B (30); Jabel (47); Schwartz
(52); Skalet (61); Eisen (91); Nowlin (109); McGee (112); ArtCarved
(155); Bridge (163) p.2 (stating that ``perfect'' should not be
allowed because relatively few diamonds ``meet all these very high
standards''); LaPrad (181); IJA (192); Phillips (204); Bedford
(210); Matthey (213); Bruce (218); MJSA (226); Preston (229); Limon
(235); Leach (258); and Solid Gold (261).
\188\ Indeed, many consumers may regard the word as ``mere
puffing.'' One comment noted, ```Perfect' pertaining to anything is
a dumb word and should arouse suspicion.'' Jabel (47) p.2.
\189\ One comment stated that limiting the use of the term
``perfect'' as a synonym for ``flawless'' to those situations in
which the diamond described is not ``of inferior color or make'' is
meaningless because ``inferior color or make'' cannot be defined.
Limon (235) p.2. The Commission agrees that the definition is not
precise, but nevertheless believes that the word can be used in a
non-deceptive manner.
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The JVC also proposed changing current Sec. 23.10 to state that it
is unfair to use the word ``flawless'' to describe a diamond ``which
discloses blemishes, inclusions, lasering, prominent reflective whitish
or colored grain lines, or clarity faults of any sort when examined
under a corrected magnifier at 10-power, with adequate illumination, by
a person skilled in diamond grading.'' With the exception of the
addition of ``lasering,'' the changes appear to be simply a change in
terminology. No reasons for the changes
[[Page 27196]]
in terminology are apparent (e.g., changing the terms ``flaws, cracks,
carbon spots, clouds or other blemishes or imperfections'' to
``blemishes, inclusions, lasering, prominent reflective whitish or
colored grain lines, or clarity faults''). Thus, the Commission has not
adopted these changes. However, the numerous comments which addressed
lasering of diamonds in the context of a related JVC proposal,
discussed below, indicate that lasering leaves channels or surface
openings in a diamond that are similar to grains or other clarity
faults. The Commission believes that it would be deceptive to describe
a diamond that discloses internal lasering under the conditions
specified in that section as ``flawless,'' and therefore has revised
this section.190
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\190\ Preston (229) stated, at p.10, that the word ``internal''
should precede the word ``lasering'' in this section, apparently to
clarify that ``lasering'' in this section is not meant to include
the use of lasers to cut diamonds but rather the use of lasers to
remove blemishes. The Commission agrees with this comment and has
included this clarification in the revised Guides.
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The Commission also has included the JVC's descriptions of when the
flaws are visible--i.e., ``when examined under a corrected magnifier at
10-power, with adequate illumination, by a person skilled in diamond
grading.'' This is an updating of the current Guides (which refer to an
examination ``in normal daylight, or its equivalent, by a trained eye
under a ten-power, corrected diamond eye loupe or equal magnifier'') to
reflect changes in available equipment.191
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\191\ ICT (189) also suggested, at p.2, a modification of
Sec. 23.10, i.e., that the word ``flawless'' should always be
accompanied by the magnification level at which no flaws are visible
[for example, ``flawless under 15X loupe'']. However, there is no
evidence that such detailed information is material to consumers.
---------------------------------------------------------------------------
In the current Guides, the Note following Sec. 23.10(a) also states
that the use of a phrase such as ``commercially perfect'' for a diamond
that has flaws is ``regarded as misleading and in violation of this
section.'' The JVC proposed expanding this portion of the Note to also
cover the phrase ``commercially flawless.'' 192 The Commission
believes that the provision in the revised Guides, which applies to use
of the words ``perfect,'' ``flawless,'' or ``any representation of
similar meaning,'' is sufficient to prevent deception. The current Note
is superfluous, and the Commission has deleted it.193
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\192\ Eisen (91) stated, at p.1, that ``commercially flawless''
should not be allowed but did not offer any reasons.
\193\ The JVC also proposed adding a Note that states that the
term ``internally flawless'' may be used to describe a diamond
``which meets the requirements set forth . . . but possesses only
minor surface blemishes such as grain lines, polish or burn marks,
scratches, nicks, or small naturals.'' No reasons were offered for
this change. However, Lannyte (65) p. 5, stated ``Do not play games
with the word `internally.' Any surface blemish has to exist on or
in the surface to exist at all.'' Based on this comment, and the
lack of other explanation for this provision, the Commission has not
included this Note in the Guides.
---------------------------------------------------------------------------
Section 23.10(b) states that it is unfair to describe a ring or
other article of jewelry with a ``perfect'' center stone and side
stones which are not ``perfect,'' as ``perfect,'' without disclosing
that the description applies only to the center stone. The JVC proposed
modifying this to apply to representations that stones are
``flawless,'' and also proposed changing the reference to ``center
stone or stones'' to ``principal diamond or diamonds.'' Such a change
appropriately includes jewelry in which the principal stone is not the
center stone.
4. Disclosure of Treatments
Section 23.18 of the current Guides, entitled ``Deception as to
precious and semi-precious stones,'' contains a Note which states that
any artificial coloring or tinting of a diamond or precious or semi-
precious stone by ``coating, irradiating, or heating, or by use of
nuclear bombardment, or by any other means'' should be disclosed and
the fact that the coloring is not permanent, if such is the fact.
The JVC proposed moving the portion of this section that applies to
diamonds into the diamond category, modifying it to apply to any
diamond that has been treated (rather than colored) by certain methods,
and adding the following treatments to this list of those that should
be disclosed: the internal use of a laser beam, the introduction or the
infusion of any foreign substance, or treatment ``by any other means,
without disclosure of the fact that the inherent quality and/or
appearance of such diamond has been enhanced, and the result of this
enhancement is not or may not be permanent, if such is the case.''
194
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\194\ ISA (237A) proposed, at p.53, changing ``internal use of
laser beam'' to ``the penetration of a laser drilling technique and/
or acid bath(s) which is customarily used by the trade to change the
color of `black' inclusions to `white.''' It also suggested that
``infusion of any foreign substance'' should be followed by the
words ``fracture filled.'' However, the Commission believes that the
words used in the JVC proposal adequately identify the processes
that are being addressed.
---------------------------------------------------------------------------
Internal laser treatment and the infusion of a foreign substance
are treatments that did not exist in 1959 when the Guides were last
substantively revised. A laser treatment involves the use of a laser
beam to improve the appearance of diamonds having black inclusions by
directing the laser beam at the black inclusion and then forcing acid
through the tunnel made by the laser beam to remove the inclusion or to
alter it so that the inclusion is not visible to the naked eye.
``Infusion'' treatment, also known as ``fracture-filling,'' conceals
cracks in diamonds by filling them with a foreign substance.
Thirteen comments opposed the disclosure of laser treatment stating
that it is ``a common practice'' and ``an extension of cutting, since
soaking out surface black leaves no evidence of soaking. The channel
left by the laser is often just one of several or numerous `natural'
cracks, inclusions, or grain.'' 195 Verstandig stated that the
other treatments which the JVC proposed should be disclosed ``are
hardly-if at all-noticeable under a 10X magnification'' but that
lasering is obvious under such magnification. It also noted that while
lasering produces a small surface opening, the majority of diamonds
sold in the U.S. have similar surface imperfections, and disclosure of
these is not required.196
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\195\ Green (6) p.1; see also London Star (20); DMIA (26);
Roisen (31); Werdiger (48); Verstandig (154); David (194); H.R.
Diamonds (195); ADS (197); Weitz (200); Kwiat (203); NACSM (219);
and Service (222).
\196\ Comment 154, p.2.
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DMIA noted that lasering is ``irreversible, does not add a foreign
substance, is readily detectable with a ten power loupe, and does not
require disclosure any more than * * * cutting an additional facet to
improve the purity of a diamond.'' It also noted that GIA, which it
described as a world-renowned diamond grading lab, refuses to grade
diamonds infused with a foreign substance but does grade lasered
diamonds, indicating on the grading report ``inclusions, naturals,
extra facets, as well as lasering.'' 197 In addition, it noted
that resolutions have been adopted on ``a world-wide basis requiring
full disclosure of any ``treatment'' of diamonds such as irradiation
which changes the color and atomic structure or the infusion of a
foreign substance which produces a product no longer a pure diamond,
but a ``composite'' material.'' It stated that ``[l]asering, on the
other hand, is not a ``treatment'' * * * .'' 198
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\197\ Comment 26, pp.1-2.
\198\ Comment 26, p.1. Roisen (31), David (194), H.R. Diamonds
(195), ADS (197), and Weitz (200), all referred to the fact that the
rules of the World Federation of Diamond Bourses require strict
punishment of a member who fails to disclose treatment of a diamond,
such as irradiation or infusion of a foreign substance. See the text
of the joint resolution of the World Federation of Diamond Bourses
and the International Diamond Manufacturers Association, as
described in the Rapaport Diamond Report, July 17, 1992, p.5
(attached to Rapaport (233)).
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[[Page 27197]]
On the other hand, one comment contained an attachment that argued
that internal lasering should be disclosed because it adversely affects
the value of the diamond.199 The attachment stated that lasered
stones are inferior because they ``are worth less than normal non-
lasered stones of the same grade.'' It further stated that a diamond
purchaser who is unaware of the lasering, will be upset ``when the
appraisal indicates laser treatment, or upon resale when the buyer
offers a lower price due to lasering.'' 200
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\199\ Rapaport Diamond Report, July 17, 1992, p.6, attached to
Rapaport (233); see also Preston (229) p.3; ISA (237A) p.51.
\200\ Rapaport Diamond Report, July 17, 1992, p.6, attached to
Rapaport (233).
---------------------------------------------------------------------------
However, the comments (including eleven comments from diamond
dealers and a diamond trade association) indicated that lasering is a
common practice and not an extraordinary process that would be
deceptive to conceal from the consumer. Moreover, a consumer acting
reasonably under the circumstances would be on notice of laser
treatment before sale. A grading report would indicate that the diamond
had been laser-cleaned, and, if the buyer chose to examine the diamond
under standard ten-power magnification, the laser tunnels would be
obvious to the buyer. Thus, the Commission has determined not to
include lasering among the treatments that always should be disclosed
to avoid misleading consumers.
By contrast, twelve of the thirteen comments that opposed
disclosure of lasering stated that the fracture-filling process is a
treatment of a diamond that should be disclosed to the
consumer.201 As previously noted, several of these comments stated
that the rules of the World Federation of Diamond Bourses require
disclosure of fracture-filling. Because fracture-filling is not the
norm or what consumers acting reasonably under the circumstances would
expect, it would be deceptive to fail to disclose fracture-filling.
Consumers will not likely expect, in the absence of disclosure, that
the stone was so treated. Thus, the absence of disclosure is also
unfair in that it is likely to cause injury to consumers by
affirmatively misleading their informed choice and so causing
substantial, unavoidable injury that is not outweighed by any
countervailing benefits.202 Accordingly, the revised Guides advise
sellers to disclose this treatment.
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\201\ Green (6); London Star (20); DMIA (26); Roisen (31);
Werdiger (48); Verstandig (154); David (194); H.R. Diamonds (195);
ADS (197); Weitz (200); Kwiat (203); and NACSM (219). Service (222)
opposed all disclosure of diamond treatments, and did not
specifically discuss fracture-filling. Best (225) opposed all the
changes proposed by the JVC, but stated that fracture-filling ``may
justify some future study and potential regulation by the FTC.''
\202\ International Harvester Co., 104 F.T.C. 949, 1051 (1984).
NACSM (219), at p. 26, pointed out that the process can sometimes be
reversed by heat. For example, it is not uncommon for a diamond to
be remounted and the heat from that process may partly melt out the
foreign material used to fill the fracture. This adversely affects
the appearance of the diamond and it may not be possible to remove
the remainder of the fracture-filling material. See S. Lynn Diamond,
``Filled Diamonds in the Spotlight,'' National Jeweler, Dec. 1,
1994, at 36, 42 & 43.
---------------------------------------------------------------------------
The JVC also proposed that this section require the disclosure of
treatment of a diamond ``by any other means.'' However, the Commission
believes that phrase is sufficiently vague to imply, for example, that
removal of blemishes by lasering always should be disclosed, and thus,
has not included this phrase in the section.
5. ``Blue White'': Sec. 23.11
Section 23.11 of the current Guides prohibits the use of ``blue
white'' to describe a diamond ``which under normal, north daylight or
its equivalent, shows any color or any trace of color other than blue
or bluish.'' The JVC proposed prohibiting the use of this term.
The term ``blue white'' has apparently been misused in the past to
describe poorer quality or ``off color'' diamonds.203 The use of
blue white appears to have diminished because most of the industry now
uses formal diamond grading systems. One comment suggested that ``blue
white'' be restricted to ``a diamond that has strong blue fluorescence
and is of the D-G color range [in the GIA grading system].'' 204
However, the current Guides describe a proper use of blue-white and
discourage its misuse. The Commission therefore has retained this
section of the Guides.205
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\203\ The definition of blue white in the Jewelers' Dictionary
states: ``Term, often abused, to describe the color of a diamond. As
frequently abused, it includes anything from a Jager to a Silver
Cape. . . . [n.b., Jager refers to a fine white diamond; Silver Cape
is a yellow one.] Better Business Bureaus recommend avoidance of the
term and the American Gem Society prohibits its use.'' ``Jewelers'
Dictionary'' 28 (3d ed. 1976). However, the proprietor of Solid Gold
(261) stated, at p.2, that he has seen ``many diamonds which are
accurately described as having a bluish-white color.''
\204\ Rapaport (233) p. 2 (stating that the ``guides should not
outlaw any terminology used by the trade'' but instead should define
it ``so that it is not misleading'').
\205\ ISA (237A) recommended, at p.53, the addition of a
definition of ``normal north daylight'' and an addition which would
limit the use of the term blue white to ``a diamond which is totally
natural and free from any man induced treatments which exhibits a
partially white body color and a partially blue body color. . . .
The term blue body color is not to be blue caused by visible
fluorescence . . . '' However, no evidence was provided that either
of these additions were necessary, and the Commission has not
included them in the Guides.
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6. Cuts of Diamonds and ``Clean Diamonds'': Secs. 23.12- 23.14
Section 23.12 of the current Guides states that it is unfair to
describe a diamond as ``properly cut,'' ``well made,'' or ``modern
cut'' or words of similar meaning, if it is ``lopsided, or so thick or
so thin in depth as materially to detract from the brilliance of the
stone.'' Section 23.13 restricts the use of the terms ``brilliant,''
``brilliant cut'' or ``full cut'' to a round diamond having at least 56
facets.206
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\206\ This section does allow certain other cuts (emerald,
pear-shaped, heart-shaped, oval-shaped, and marquise) meeting the
above-stated facet requirements to be described as ``brilliant cut''
or ``full cut'' if ``disclosure is made of the fact that the diamond
is of such form.''
---------------------------------------------------------------------------
The JVC did not propose any changes to these sections, but several
comments did propose revisions. Two comments proposed certain numerical
standards for describing ``properly cut'' diamonds.207 AGL
proposed that the Guides state that it is unfair for ``a diamond
quality assessment report to itemize a series of percentages and non-
integrated cutting details without reference to a meaningful and
comprehensive evaluation of cutting in order to facilitate a consumer's
understanding of these critical value components.'' 208 However,
AGL also indicated that such reports do not usually contain such an
evaluation of cutting.209 No other comments addressed this issue.
Because there is insufficient information in the record to evaluate the
proposals, the Commission has not changed these sections.
---------------------------------------------------------------------------
\207\ ISA (237A) pp.54-56; Rapaport (233) p.3 (proposing a
definition for a range of `Properly Cut' round diamonds and
numerical standards (which differ from ISA's proposed numerical
standards)).
\208\ Comment 230, p.5. AGL also suggested that the Guides
state that it is unfair for any diamond or colored stone quality
assessment reports or appraisals to fail to contain adequate
tolerance information for each element that impacts on the value.
Id. at 4. However, the Commission believes such a proposal, which
would involve providing guidance on the manner in which appraisers
and graders prepare reports, is beyond the scope of these Guides.
\209\ Comment 230, p.5. Preston (229) stated, at p.6, that
``AGS attempts to train its members to specify cutting grades rather
precisely. GIA, on the other hand, does not specify a cutting grade
at this time.''
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Section 23.14 states that it is unfair to use the terms ``clean,''
``eye clean,'' ``commercially clean,'' ``commercially white,'' or
similar terms to mislead or deceive consumers. The JVC did not propose
any changes to this section. Unlike other provisions of the Guides,
this section does not provide guidance regarding the use of these
terms, other
[[Page 27198]]
than to state that they should not be used to deceive purchasers.
Although one comment indicated that these terms are still in
use,210 the Commission has concluded that the admonition in
Sec. 23.1 not to misrepresent material characteristics of a product
adequately encompasses misrepresentations regarding these terms.
Therefore, the Commission has deleted this provision from the Guides.
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\210\ Rapaport (233) stated, at pp.2-3, that the terms
``clean,'' ``eye clean,'' and ``commercial white'' are ``regularly
used by the diamond trade to describe diamonds,'' noting
specifically that the term ``eye clean'' is ``commonly used to
describe diamonds that do not have inclusions that are visible to
the naked eye.''
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7. Proposals Relating to Diamond Weight
a. Misrepresentation of weight. Section 23.16 of the JVC petition
deals with misrepresentations of diamond weights, an issue which is not
specifically addressed in the current Guides. The JVC's proposed
preamble to this section states that the standard unit of weight for
diamonds is the carat, defines the terms carat and point, and states
that the abbreviation for carat is ct. The Commission has not included
this preamble in the revised Guides. As discussed below, the Commission
has included a provision relating to the use of ``points'' in the
revised Guides, and that provision contains an explanation of the
meaning of ``carat'' and ``point.''
The JVC suggested adding a section stating that it is unfair to
misrepresent the weight of a diamond. Section 23.1 of the current
Guides provides that it is unfair to misrepresent various material
characteristics of industry products, including weight. However, the
Commission has included this admonition against misrepresenting the
weight of diamonds in section 23.17 of the revised Guides, and has
provided additional guidance for diamond weight representations in that
section, as discussed in detail below.
b. Use of ``points''. The JVC, in section 23.16(a), proposed that a
section be added to the Guides stating that the use of the term
``points'' 211 to represent the weight of a diamond is unfair
except ``in direct conversations.'' In some instances, according to the
comments, consumers perceive a representation that a diamond is ``.25
pt.'' to mean ``.25 ct.'' 212 The latter is \1/4\th carat; the
former (.25 pt.) is 1/400th carat. To obtain more information about
this issue, the FRN asked whether the use of ``points'' to describe
diamond weights should be limited to oral representations.
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\211\ The term ``point'' is used to express one-hundredths of a
carat (e.g., .25 ct = 25 points).
\212\ Limon (235) p.3 (stating that the proposal ``was inspired
by a nationally published advertisement for an item containing a
diamond weighing `.25 pt.'[which was] universally misread as `.25
ct.'''); Skalet (61) p.4 (stating that ``considerable deception has
been leveled at the consuming public to make a `point .25 carat' or
`.25 point' gemstone appear to be describing a \1/4\ carat
gemstone''); Bedford (210) p.2 (stating ``I have had some people
come in thinking they were going to win a .25ct. diamond and they
were actually getting a .025 point diamond''); Bruce (218) p.10
(noting that ``we have seen advertisements where people confuse
points with carats (pt. with ct.)'').
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Thirty-five comments addressed this issue. Four comments, including
ones from the Postal Service and NACAA, supported eliminating use of
the term ``points'' in either oral or written representations.213
Twenty-two comments supported limiting the use of the term ``points''
to oral representations.214 Nine comments stated that the use of
the term should be permitted in written as well as oral
representations, contending that the term can be used in writing in a
manner that is not unfair or deceptive.215
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\213\ Honora (15); Lannyte (65); NACAA (90); and Postal Service
(244).
\214\ Fasnacht (4); Sibbing (5); Thorpe (7); Argo (17); AGS
(18); Capital (19); Estate (23); Jabel (47); Schwartz (52); Skalet
(61); GIA (81); Nowlin (109); McGee (112); Bridge (163); IJA (192);
Phillips (204); Bedford (210); Matthey (213); Bruce (218); MJSA
(226); Preston (229); and Limon (235).
\215\ G&B (30); ArtCarved (155); Bales (156); LaPrad (181);
NACSM (219); Service (222); Diamonique (224); Best (225); and Leach
(256). Diamonique (224) stated, at p.1, that prohibition of
``point'' or ``pt.'' would ``result in the use of fractional
definitions of diamond weights as used in the past.'' However, other
comments (discussed below), stated that fractions are currently in
wide use, and are not deceptive.
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One comment noted that ``points'' is ``a term that the layman is
not familiar with.'' 216 The Postal Service favored a prohibition,
stating that, in many situations, consumers do not actually see the
jewelry before purchasing it, and the term point (i.e., .25 pt.) is
used to misrepresent the value of a diamond.217
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\216\ Bruce (218) p.10.
\217\ Comment 244, pp.1-2.
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The comments clearly believe that the term ``pt.'' is being used to
deceive the public, particularly in mail order transactions.218
The deception described in the comments appears to arise primarily when
the abbreviation for point (``pt.'') appears in writing.219
---------------------------------------------------------------------------
\218\ Thorpe (7) p.2 (stating that the ``consumer sees a
jewelry term they are `familiar' with and read it as 0.25 ct.'').
\219\ However, one comment noted that problems also occur in
television advertising. Sibbing (5) p.1 (stating ``No more `quarter
point diamonds' as can be found on TV advertisements'').
---------------------------------------------------------------------------
Nevertheless, the term ``point,'' with adequate disclosure, could
be used in a non-deceptive manner. Therefore, the Commission has added
a provision to the Guides which states that if the term ``point'' is
used in advertising (including television) or in point of sale
materials to describe the weight of a diamond, the weight should also
be given in decimal parts of a carat (e.g., .25 pt. is .0025 ct.). The
admonition to include the carat weight in decimals should deter sellers
from attempting to mislead consumers. Furthermore, Sec. 23.2 of the
Guides addresses the use of misleading visual representations of
diamonds.
c. Disclosure of minimum total weight. The JVC also proposed adding
provisions to the Guides stating that it is unfair to fail to mark new
industry products containing one or more diamonds with the minimum
weight of the diamonds in the product and that it is unfair to refer to
the weight of a diamond or diamonds in advertising for new industry
products without disclosing the minimum total weight.220 The FRN
solicited comment on this proposal.
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\220\ Apparently the proposal was limited to new products
because, as one comment noted, ``it is impossible to get exact
measurements of a diamond weight when measuring diamonds when
mounted.'' Bedford (210) p.2.
---------------------------------------------------------------------------
Thirty-nine comments addressed this issue. Thirty-one comments
approved marking jewelry, or tags or invoices attached to it, with the
minimum weight of the diamonds set in it.221 Eight comments
opposed the proposal.222
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\221\ JMC (1); Fasnacht (4); Sibbing (5); Thorpe (7); Honora
(15); AGS (18); Capital (19); Estate (23); G&B (30); Jabel (47);
Schwartz (52); Skalet (61); Lannyte (65); GIA (81); NACAA (90);
Nowlin (109); McGee (112); ArtCarved (155); Bales (156); Bridge
(163); LaPrad (181); IJA (192); Phillips (204); Bedford (210); JVC
(212); Matthey (213); Bruce (218); MJSA (226); Preston (229); Limon
(235); and Leach (258). Two of these stated that diamonds under .10
carat should be exempt [Skalet (61) and ArtCarved (155)], and one
stated that the minimum weight information should only be required
on the invoice [Honora (15)].
\222\ Argo (17); Schaeffer (211); NACSM (219); Service (222);
Best (225); Sheaffer (249); and Franklin (250). (Solid Gold (261)
also opposed this provision, but apparently did not understand that
it would only apply to new jewelry.) Several of these comments
stated that this requirement would increase costs.
---------------------------------------------------------------------------
Generally, the comments indicated a belief that marking new jewelry
with the minimum diamond weight would prevent misrepresentation of
weight by the manufacturer or other sellers farther down in the line of
commerce. GIA stated that there was a tendency for ``multistone rings
and other jewelry sold as a given weight to weigh less than the
indicated weight,'' especially where the ring is not stamped with the
minimum weight.223 GIA further stated that ``[i]n our experience,
if the total weight is stamped on the jewelry, the manufacturer usually
makes sure that
[[Page 27199]]
the weight is accurate,'' and believed that ``requiring stamping of a
minimum weight on the jewelry (particularly in combination with
trademark stamping) would provide a strong deterrent against
underweighting diamond content.'' 224
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\223\ Comment 81, p.2.
\224\ Comment 81, p.2. AGS (18) p.2 (stating, ``The market place
is replete with purveyors of diamond jewelry who overstate the total
carat weight of multi-diamond items'').
---------------------------------------------------------------------------
NACAA commented that its members received complaints about
exaggeration of the weights of stones (not limited to diamonds) and
stated that it would be ``helpful to consumers'' for the Guides to
require marking of minimum total weight on new items.225 However,
the Guides already state that it is unfair to misrepresent the weight
of a diamond (or any other jewelry). Moreover, none of the comments
explained why it would be unfair or deceptive to fail to mark new
jewelry containing diamonds with the minimum total weight of the
diamonds, nor is there any obvious reason why a failure to so mark the
jewelry, or to include this in advertising, would be unfair or
deceptive.226 Therefore, the Commission has not included this
provision in the revised Guides.
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\225\ Comment 90, pp.1-2.
\226\ Indeed, if this practice is unfair or deceptive for
``new'' jewelry, logically it is also unfair or deceptive for
``old'' jewelry and for jewelry containing gemstones other than
diamonds. LaPrad (181) p.2, and Limon (235) p.4, each suggested that
the weight marking requirement should apply to colored stones as
well as diamonds.
---------------------------------------------------------------------------
d. Weight tolerance. The JVC also proposed adding provisions to the
Guides setting forth specific tolerances for diamond weight
representations. The JVC proposed in sections 23.16(c)-(e) of its
petition, a tolerance of .005 carat for weight representations for
individual diamonds, whether mounted or unmounted, and a tolerance of
.01 carat for weight representations pertaining to ``two or more
diamonds in a single product.'' This proposal generated 84
comments.227 Three comments specifically supported the JVC's
proposed tolerance.228 Eighty-one commenters opposed the proposed
tolerances.229
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\227\ This figure is exclusive of comments that simply favored
all the changes suggested by the JVC.
\228\ Bruce (218); Limon (235); and Schwartz (52).
\229\ NACSM (219); Service (222); Diamonique (224); Best (225);
MJSA (226); Rapaport (233); and NRF (238) submitted individual
comments. The other 74 were form letters. In the interest of
brevity, the 74 commenters are listed here by their comment number
only: 28; 32; 33; 35; 36; 37; 39; 40; 41; 43; 45; 46; 50; 51; 53;
54; 55; 56; 57; 58; 59; 60; 63; 67; 68; 69; 70; 71; 72; 73; 74; 75;
77; 78; 79; 80; 93; 94; 95; 96; 97; 99; 100; 101; 102; 104; 105;
107; 108; 110; 114; 115; 117; 119; 121; 122; 157; 158; 160; 164;
179; 180; 190; 191; 201; 211; 214; 220; 241; 243; 260; 263; and 264.
---------------------------------------------------------------------------
One comment stated that the proposed tolerance was too small
because few diamond scales are so finely calibrated, and that the
tolerance should be .01 ct.--one hundredth of a carat.230 However,
Commission staff telephoned several companies, and determined that most
have scales that can weigh diamonds to .005 carats.231
---------------------------------------------------------------------------
\230\ Rapaport (233) p.4. Diamonique (224) pp.1-2 (stating that
current measuring devices are not adequate and the present tolerance
is .01 carat). But see Fasnacht (4) p.2 (stating that weighing is
fast and accurate with today's electronic scales).
\231\ Commission staff interviewed 5 jewelers (Boone and Sons
Jewelers, Fleisher Jewelers, Kings Jewelry, Loubons, and Jewelry by
Design) in the Washington area about what kind of scales they use.
No store utilized a scale that was not accurate enough to meet the
proposed .005 carat tolerance. Staff also interviewed Ben Fine, who
sells Melter Scales; Gaston Lopez, a sales representative of
Gemological Institute of America, which sells several different
makes of scales; and a representative from Dendritic Scales. All
confirmed that they sell scales that are accurate to within \1/2\
point.
---------------------------------------------------------------------------
Numerous other comments opposed the tolerances because they would
increase the cost of sorting diamonds, raise the price of diamonds for
high-volume manufacturers, and increase prices for consumers. MJSA
explained that high-volume manufacturers sieve rather than weigh
individual stones, and that the proposed tolerance would require
manufacturers to ``weigh, tag, and flute the stones to be incorporated
in a piece of jewelry.'' 232 MJSA stated that ``the added costs of
this procedure would be reflected in the price of the finished article
and be passed on to the consumer.'' 233
---------------------------------------------------------------------------
\232\ Comment 226, p.8.
\233\ Comment 226, p.8. NACSM (219) pp.20-21 (explaining that
rough diamonds ``are purchased most often from DeBeers * * * [and]
sold to manufacturers * * * in parcels containing certain grade and
quantities such as `one fifths,' `quarters,' `one thirds,' `halves,'
`carats,' etc. The fractions refer to the approximate sizes of the
diamonds contained in the parcels''); Goldman (60) p.3 (stating that
the international market ``sells as a fifth of a carat, goods
(diamonds) from 18 to 23 points'').
---------------------------------------------------------------------------
Although Bruce supported the proposed tolerance and opposed the use
of fractions to describe diamond weights, it noted that ``fractional
diamond sizes are a convenience for the industry, in the trading of
loose stones,'' and that ``keeping track of diamond sizes for tagging
purposes would require a little more care and planning, but it can be
done.'' 234
---------------------------------------------------------------------------
\234\ Comment 218, pp.2-3 (also stating that ``if people in the
trade buy a single stone they will pay for it by its exact
weight'').
---------------------------------------------------------------------------
Many commenters stated that the current industry practice is to use
fractions to designate weights of less than a carat, and that there is
a standard tolerance for such fractional representations. Service
explained that chain retailers use fractions to advertise diamonds so
that specific prices can be given for specific weights. Service
explained that the proposed tolerance would be costly because it
``would narrowly and unreasonably limit the range of weights available
for particular fractions of a carat.'' 235 For example, a fifth
represents 20 points and under the JVC's proposed tolerances, only
diamonds that weigh at least 19.5 points could be described as a fifth.
Several commenters stated that they used the standards contained in the
GIA publication, ``Diamonds 3.'' 236 This 1986 GIA booklet,
states, at p.19, that ``approximate weights are often stated in
fractions,'' and it sets out a chart stating the average weight range
associated with the various fractions (i.e., \1/5\ carat refers to .18
through .22 carat).237
---------------------------------------------------------------------------
\235\ Comment 222, p.3. Numerous comments also indicated that
there would be high demand for stones close enough to the fractions
to be designated as fractions, and other stones could not be used by
mass retailers. ``If retailers were no longer allowed to sell 18
points as a fifth, then what would happen to all the 18 and 19
pointers * * *?'' Goldman (60) p.2. London Star stated, ``This
standard would considerably lessen the availability of stones within
each size and therefore drastically increase the price to the
consumer.'' Comment 20, p.2. Of course, diamond weights can be, and
often are, expressed in the decimal system. However, the mass
marketers, for the reasons described above, state that it is more
efficient for them to describe diamond weights as fractions.
\236\ Attachment B to NACSM (219). Best (225) pp.4-5 (stating
that these standards ``have been widely used and accepted for many
years and have effectively become the national and international
industry standard''); NACSM (219) p.11 (stating that these GIA
ranges ``merely recognize industry standards which have resulted
from longstanding accepted custom and usage'').
\237\ Attachment B to NACSM (219). The booklet notes that the
ranges ``may vary slightly from one firm or organization to
another.'' Id. This is borne out by the comments.
---------------------------------------------------------------------------
Best noted that under the GIA tolerances, a diamond can be sold as
half a carat if it weighs between .47 and .56 carats, but that the
proposed tolerances would require it to weigh at least .495 carats.
Best stated that under the JVC proposal it would be forced to either
select stones that fall within the tolerances, so that prices for the
size could be advertised, or to treat each stone individually, and not
provide price information regarding the stones in advertising. It
explained that because there is a limited supply of stones that fall
within the JVC's proposed tolerances, demand will escalate for these
stones and the cost of the stones will increase. Therefore,
``[j]ewelers like Best would no longer be able to offer a consistently
lower price alternative to the traditional high margin jewelers.''
Instead, Best would be forced to ``price, mark and sell each item
individually,'' which is the philosophy of a boutique
[[Page 27200]]
jeweler, and ``contrary to the way a mass merchandiser operates.''
238
---------------------------------------------------------------------------
\238\ Comment 255, p.8.
---------------------------------------------------------------------------
Several comments suggested alternatives to the JVC proposal. MJSA
suggested ``a broader minus tolerance which is expressed in
proportional terms rather than as an absolute quantitative
measurement.'' 239 Ross-Simons suggested a tolerance of 5% or .05
carat for a piece with multiple diamonds, whichever is smaller.240
---------------------------------------------------------------------------
\239\ Comment 226, p.8.
\240\ Ross-Simons (67) stated, at p.1, that for catalog
advertisers ``a tolerance of just .01 ct on a piece of jewelry with
multiple diamonds is too restrictive . . . [because] we show a piece
of diamond jewelry in our catalog and order backup items after the
catalog is mailed.'' Ross-Simons further stated that for pieces
containing several carats of diamonds, with multiple stones, a .01
ct. deviation is unrealistic, and would require it to either
``understate the weight to be safe or overcharge the consumer.''
Comment 67, p.1.
---------------------------------------------------------------------------
The Commission agrees with the comments that state that the
proposed tolerance may be too restrictive and may result in an
increased cost to the consumer. However, consumers may not interpret a
claim that a diamond is half a carat as meaning that it falls within
the range set out in the GIA booklet. In fact, the GIA booklet states:
``Customers also think in terms of fractions, but they tend to expect a
half-carat stone to weigh exactly 0.50 carat.'' 241 Furthermore,
diamonds are so expensive that receiving a diamond that is even a few
points less than what was represented can be a significant loss to the
consumer. In this respect it appears that at least for some industry
members, current practice may be contrary to consumers' expectations
and may not adequately apprise consumers of the terms of the seller's
offer (i.e., that jewelry advertised with \1/5\ carat diamonds is
actually offered as jewelry with \1/5\ carat weight, plus or minus some
tolerance the seller is using).
---------------------------------------------------------------------------
\241\ GIA booklet, p.19, attached as Exh. B to NACSM (219).
---------------------------------------------------------------------------
However, the Commission believes that a fractional representation
of carat weight may be qualified so that it is neither unfair or
deceptive. For example, if a claim such as ``\1/2\ carat'' is
accompanied by a disclosure of the weight range that is used, it does
not imply precision to the level of 0.005 carat. A decimal
representation of carat weight, such as ``0.47 carat,'' does imply
accuracy to the level of the second decimal place--i.e., .005 carat.
Therefore, the level of tolerance applicable to a diamond weight claim
depends on the type of claim that has been made.
Thus, the revised Guides clarify that representations of diamond
weight should indicate the weight tolerance that is being used. If
diamond weight is stated as decimal parts of a carat, the stated figure
should be accurate to the last decimal place. If a fractional
representation is used to describe the weight of a diamond, the fact
that the diamond weight is not exact should be conspicuously disclosed
in close proximity to the fractional representation, and the range of
weight for each fraction should also be disclosed. A Note following
this section (23.17) explicitly states that, for claims made in
catalogs, the disclosure should appear on every page where the claim is
made, but that the disclosure may refer to a chart or other detailed
explanation of the actual ranges used. (For example, ``Diamond weights
are not exact; see chart on p.X for ranges.'') 242 These
provisions also provide guidance for making weight representations for
items with multiple stones.
---------------------------------------------------------------------------
\242\ Some mass retailers stated that they already provide the
weight ranges in their catalogs and/or at the point of purchase.
Best (225) p.5 and Service (222) p.3.
---------------------------------------------------------------------------
e. Misrepresentation of weight of diamonds combined with other
gemstones. Finally, one comment suggested that a provision be added to
the Guides stating that it is unfair to represent the combined weight
of two or more gemstones of different gemological varieties in any new
single product as ``total gemstone weight'' or words of similar import,
without disclosing with equal conspicuity the combined weight of the
gemstone of each gemological variety in the products.243
---------------------------------------------------------------------------
\243\ Limon (235) p.4.
---------------------------------------------------------------------------
However, the phrase ``total gemstone weight'' does provide notice
that the weight given applies to all gemstones in the item, not just
the most expensive. Thus, the Commission does not believe that a
representation of ``total gemstone weight'' would inherently be unfair
or deceptive. Consumers interested in a breakdown by gemstone category
would be put on notice by the statement ``total gemstone weight'' that
further inquiry is needed.
E. Pearls (Category IV): Secs. 23.15-23.17
The current Guides address pearls in the definition section,
Sec. 23.0, and in Secs. 23.15-23.17. Section 23.15 describes practices
which are unfair uses of the word ``pearl.'' Section 23.16 describes
unfair uses of other terms, such as ``cultured pearl,'' ``Oriental
pearl,'' and ``natura.'' Section 23.17 describes unfair practices
involving false, misleading, or deceptive statements about cultured
pearls, including the manner in which they are produced and the
thickness of the nacre coating. In addition, provisions in Secs. 23.20
and 23.21, pertaining to the misuse of certain words (real, genuine,
natural, gem, reproduction, replica, and synthetic) apply to pearls.
The changes proposed by the JVC and by certain commenters are discussed
below.
1. Definitions
a. Modifications of existing definitions. The Commission has moved
the definitions relating to pearls from Sec. 23.0 to the beginning of
the substantive sections that deal with pearls (Sec. 23.18). The JVC
proposed changes (in section 23.17 of its petition) in the three
definitions pertaining to pearls (``pearl,'' ``cultured pearl,'' and
``imitation pearl'') that currently appear in the Guides. No reasons
were offered for changing the current definitions, and there was no
allegation that they were inaccurate or caused any problems.
Four comments addressed the proposed changes in the definitions.
The National Retail Federation stated that cogent definitions for the
three basic types of pearls ``are lacking'' in the JVC
petition.244 Three comments suggested changes in the JVC's
proposed definitions, but did not explain why it is necessary to change
the definitions in the current Guides, nor state that any
misconceptions have occurred.245
---------------------------------------------------------------------------
\244\ Comment 238, p.2.
\245\ A&Z Pearls (29) p.1 (suggesting that the JVC's definition
of ``cultured pearl'' be revised to include a better definition of
the word ``nacre'' because it would ``eliminate misinterpretations
of the term therefore clearing any misconceptions of `nacre' being
formed by a human agency''); AGTA (49) p.15 (suggesting editing the
JVC's proposed definition of ``pearl''); CPAA (193) p.3 (suggesting
editing the JVC's proposed definition of ``pearl'' and ``imitation
pearl'').
---------------------------------------------------------------------------
Definitions are helpful to the extent that they make clear what
can nondeceptively be represented to be a pearl, a cultured pearl, or
an imitation pearl. There is no indication that the definitions of the
three types of pearls in the current Guides have ever failed to serve
this purpose. Consequently, the Commission has not changed these
definitions.
b. Additional proposed definitions. The JVC proposed adding eleven
new definitions of types of pearls to the Guides. The JVC offered no
reason for adding definitions of these terms to the Guides, nor did it
allege that these terms had been used to deceive consumers. The
National Retail Federation noted that there are three basic types of
pearls (natural, cultured, and simulated) and that the definition
section proposed by the JVC ``is unnecessarily detailed and
confusing.'' 246 The Commission has
[[Page 27201]]
determined to include additional definitions in the Guides, as
discussed below, only where there are specific reasons for doing so.
---------------------------------------------------------------------------
\246\ Comment 238, p.1; NACSM (219) p.27 (stating that the
definitions ``seem unnecessary'').
---------------------------------------------------------------------------
i. Definitions proposed by the JVC. The only apparent purpose for
five of the proposed definitions appears to be to emphasize the fact
that a cultured pearl (or whatever specific type of cultured pearl)
must be described as a cultured pearl. The JVC proposed definitions,
with accompanying sections regarding the use of the term ``cultured,''
for the following pearls: Mabe cultured pearl, black pearl and black
cultured pearl, natural color, fresh water pearl 247 and sweet
water pearl. However, Sec. 23.15 of the current Guides already states
that it is unfair to use the unqualified word ``pearl'' to describe
anything other than a natural pearl and that it is unfair to use the
word ``pearl'' to describe a cultured pearl ``unless it is immediately
preceded, with equal conspicuity, by the word `cultured' or
`cultivated,' or by some other word or phrase of like meaning and
connotation, so as to indicate definitely and clearly that the product
is not a pearl.'' Because there is no information indicating a problem
with these terms, or the adequacy of the existing provision, the
Commission is not including these definitions in the Guides.
---------------------------------------------------------------------------
\247\ Finlay implied that retailers may be describing fresh
water cultured pearls as simply ``fresh water pearls'' and objected
to requiring advertisers to use ``cultured'' for fresh water pearls,
stating, ``consumers have come to associate the term `cultured
pearls' with round pearls and that to use the term `cultured' in
conjunction with irregularly shapen [sic] fresh water pearls would
create confusion.'' Comment 253, p.2.
---------------------------------------------------------------------------
South Sea pearls: The JVC suggested the following definitions for
South Sea pearls: ``A natural pearl found in the salt water mollusks of
the Pacific Ocean South Sea
FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
Islands, Australia and Burma.'' It
suggested that a South Sea cultured pearl be defined as a cultured
pearl ``found in the salt water mollusks of the Pacific Ocean South Sea
Islands, Australia and Burma.'' There was comment suggesting that there
is a market for South Sea cultured pearls, and that such pearls are
quite valuable. An article attached to the Rapaport comment stated that
South Sea cultured pearls ``have come to challenge the supremacy of the
Japanese akoya [cultured pearls] in quality * * *. The South Sea pearls
have a strong market because of one particular feature that makes them
attractive: size.'' 248 The CPAA stated that it frequently
receives complaints that imitation pearl companies are using foreign
names to confuse consumers.249
---------------------------------------------------------------------------
\248\ Rapaport Diamond Report, July 17, 1992, p.24, attached to
Comment 233 (noting that the South Sea pearls are the product of a
different oyster than Japanese pearls).
\249\ Comment 193, pp.13-14.
---------------------------------------------------------------------------
The Commission therefore has revised the Guides to state that it is
unfair or deceptive to represent a pearl or a cultured pearl as being a
South Sea pearl when such is not the case. This statement, which
includes a definition of the term, is included in section 23.20(g) of
the revised Guides.250
---------------------------------------------------------------------------
\250\ The CPAA suggested revising the JVC's proposed definition
of South Sea pearl: ``The word `Burma' should be replaced with the
words `Southeast Asia.' Not only is Burma now officially called
Myanmar, but there are other countries such as Malaysia, Indonesia,
and Thailand in that region which are producing similar pearls.''
Comment 193, p.4. The Commission has made this change.
---------------------------------------------------------------------------
Oriental pearl: The meaning of the term ``Oriental pearl'' is clear
in the current Guides. There is no evidence that the lack of a separate
definition has caused any confusion or resulted in any misuse of the
term. There was no comment pertaining specifically to this proposed
definition. Thus, the Commission has not included a separate definition
in the Guides.
Blister pearls: The JVC suggested definitions for ``blister pearl''
and ``cultured blister pearl'' and proposed a section stating that it
is unfair to use the term blister pearl unless it is a pearl which
meets the definition (i.e., a pearl ``often hollow and irregular in
form'').
There is no evidence that blister pearls are more valuable than
other pearls or that the term ``blister pearl'' is being used to
deceive consumers. Moreover, misrepresentations of the word ``pearl''
are adequately covered in the Guides. The Commission therefore is not
including the definitions relating to blister pearls in the Guides.
Seed pearl: Section 23.16(b) of the Guides states that it is unfair
to use the term ``seed pearl'' or any similar term to describe any
cultured or imitation pearl. The JVC proposed defining seed pearl as:
``A small, natural pearl which measures approximately two millimeters
or less.'' In a related portion of its petition, the JVC proposed a
section that states that it is unfair to describe a cultured or
simulated pearl as a seed pearl without using a qualifying term such as
``cultured,'' ``simulated,'' ``artificial,'' or ``imitation.''
The proposed definition and related section would indicate it is
not deceptive to describe cultured and artificial pearls as seed
pearls, if qualified appropriately, whereas the current Guides appear
to inhibit this. The Commission has concluded that this is a useful
change because it allows products that consumers might wish to purchase
(i.e., cultured or artificial seed pearls) to be accurately described.
ii. Definitions suggested by other commenters. Keshi pearls: A & Z
Pearls, CPAA, and AGTA proposed that a definition of ``Keshi'' pearls
be added to the Guides.251 A & Z Pearls and CPAA also proposed
adding two more definitions relating to ``Keshi'' pearls (Keshi pearl,
Sweet Water or Freshwater Keshi pearl, and South Sea Keshi pearl.) CPAA
stated the word ``Keshi'' has been used in recent years ``as a product
name for seed pearls derived by accident as a by-product of the pearl
cultivation process.'' CPAA proposed adding the term to the Guides ``to
further define what is and what is not a cultured pearl.'' 252 A &
Z Pearls stated, ``There is a lot of debate in the trade as to whether
``Keshi'' pearls should be considered natural pearls. Like natural
pearls, they grow accidentally, but they form in mollusks that are
cultivated by man.'' 253
---------------------------------------------------------------------------
\251\ AGTA (49) pp.15-16 (defining ``Keshi pearls'' as:
``Pearls that grow accidentally in the soft tissue or the adductor
muscle of cultured pearl-bearing mollusks. These tiny non-nucleated
pearls are by-products of cultured pearls. The term `Keshi' also
refers to the bigger pearls without nuclei that are spontaneously
formed in mollusks which bear South Sea cultured pearls and
freshwater cultured pearls'').
\252\ Comment 193, p.8 (defining ``Keshi pearl'' as: ``A non-
nucleated pearl, usually less than 2 millimeters in size, that may
be formed by an oyster in addition to the cultured product during
the process of cultivation'').
\253\ Comment 29, p.2 (defining ``Keshi pearl'' as: ``A
formation of some nucleated baroque shape pearls that grow
`accidentally.' The invasion of a foreign body (such as a nucleus
shell or mantle tissue) stimulates the mollusk and induces abnormal
production of nacre that forms to create `keshi' pearls'').
---------------------------------------------------------------------------
The Commission believes that the JVC proposal--i.e., allowing the
term ``cultured seed pearl'' to be used to describe very small pearls
that grow in mollusks cultivated by man--is an appropriate solution to
this issue. However, there is no reason that the term ``Keshi'' could
not also be used to refer to these pearls as long as it is not used to
deceive consumers. There is no evidence that the term ``Keshi'' is
being used to deceive consumers, and thus, the Commission has not
included the term in the Guides at this time.
Organic pearl: Majorica suggested adding a definition for ``organic
pearl.'' \254\ This definition would permit Majorica pearls to be
called ``organic'' rather than ``imitation.'' An article attached to
Majorica's comment noted that ``to the untrained eye, Majorica
imitation pearls look very much like
[[Page 27202]]
saltwater cultured pearls.'' \255\ The article, authored by employees
of the Gemological Institute of America, also implies that some other
brands of imitation pearls, like Majorica pearls, are made from guanine
crystals, although there may be other differences in the manufacturing
process that make Majorica imitation pearls superior to most other
imitation pearls.\256\
---------------------------------------------------------------------------
\254\ Comment 240, p.6 (``A pearl produced by means of
manufacture characterized by a formation of layers obtained from
guanine crystals, an organic substance from the scales of ocean fish
around a nucleus.'').
\255\ ``Majorica Imitation Pearls,'' Gems and Gemology 185 (Fall
1990), attached to Comment 240.
\256\ The article notes that ``pearl essence'' (i.e., guanine
crystals) was discovered in the late 17th century. Id. at 181. It
states that ``the process used to produce most other imitation
pearls involves dipping or painting the beads with a resin; thus,
these imitations lack the iridescence of the Majorica product and
its cultured counterpart.'' Id.
---------------------------------------------------------------------------
Majorica states that the current system of classification (i.e.,
pearl, cultured, and imitation) ``has narrowed the market for MAJORICA
pearls as a real alternative to so-called cultured pearls'' and ``gives
an unfair advantage to the cultured pearl industry.'' \257\ One
commenter noted that most cultured pearls today have only a small
percentage of nacre (the iridescent coating), unlike pearls from 40-50
years ago. Thus, cultured pearls today may not look very different from
imitation pearls.\258\
---------------------------------------------------------------------------
\257\ Comment 240, p.5.
\258\ Russell (217) pp.1, 2, and 4.
---------------------------------------------------------------------------
Majorica's suggestion, however, involves renaming items that the
public has for many years known as imitation pearls. This seems likely
to provide more rather than less opportunity for deceiving consumers.
NACAA noted, for example, that ``consumers may be particularly confused
by the many varieties of natural, cultured, and imitation pearls.''
\259\ Moreover, two commenters noted that consumers currently confuse
Majorica pearls with real or cultured pearls.\260\ Accordingly, the
Commission is not including a definition of ``organic pearls'' in the
Guides.\261\
---------------------------------------------------------------------------
\259\ Comment 90, p.3.
\260\ Lange (183) and CPAA (193) p.14.
\261\ See below for a discussion of other proposals regarding
the term ``organic.''
---------------------------------------------------------------------------
2. Misuse of the Word ``Pearl''
Section 23.15 of the current Guides deals with misuse of the word
pearl. Section 23.15 (a) states that it is unfair to use the
unqualified word ``pearl'' to describe anything other than a natural
pearl, and Sec. 23.15(b) states that it is unfair to use the word
``pearl'' to describe a cultured pearl unless it is qualified by the
word ``cultured'' or ``cultivated,'' or a word of similar import, to
indicate that the product is not a pearl. The JVC did not propose any
changes in these two sections.
Section 23.15(c) states that it is unfair to use the word ``pearl''
to describe an imitation pearl unless it is immediately preceded, with
equal conspicuity, by the word ``imitation'' or ``simulated,'' or by
some other similar word or phrase. The JVC proposed adding the word
``artificial'' to this section. NACAA stated that the Guides should
``require artificial pearls to be clearly labeled using one standard
term.'' It preferred the terms ``imitation'' or ``artificial,'' instead
of ``simulated,'' because ``consumers are more likely to understand
what those words mean.'' \262\ The word ``artificial'' clearly
indicates that a product is not a natural pearl. Thus, the Commission
is including this term in the Guides as another example of a term
(along with simulated) that can be used to describe imitation pearls.
---------------------------------------------------------------------------
\262\ Comment 90, p.3.
---------------------------------------------------------------------------
CPAA suggested that the Guides include a section that states that
it is unfair ``to use the terms `faux pearl,' `fashion pearl,' `Mother
of Pearl' or any other proper name or noun term alone when describing
or qualifying an imitation pearl product without including the words
`imitation', `simulated' or any other term of similar connotation
within the same product description and with equal conspicuousness.''
CPAA stated that the use of these terms ``has been the number one
marketing and advertising tool in the sale of imitation pearl products
across the U.S.'' CPAA explained that ``many customers can not tell the
difference between the products by sight alone,'' and that ``[w]ithout
proper product designations such as natural, cultured and imitation,
customers are often misled as to the true nature of the product that
they are buying.'' \263\ With respect to ``faux'' generally, NACAA
stated that ``we do not believe that most consumers know what it
means'' and the Postal Service stated that ``the term `faux' has been
used to confuse unsophisticated consumers and enhance the apparent
value of their costume jewelry.'' \264\
---------------------------------------------------------------------------
\263\ Comment 193, p.9.
\264\ Comment 90, p.3 and comment 244, p.3.
---------------------------------------------------------------------------
As noted, the Guides currently state that it is unfair to describe
an imitation pearl as a pearl without a qualifier such as
``imitation.'' Although the Guides permit sellers to use terms other
than imitation as long as they ``indicate definitely and clearly that
the product is not a pearl,'' based on information from CPAA, the
Postal Service, and NACAA, it appears that the terms faux pearl,
fashion pearl, and Mother of Pearl are inadequate to convey to a
substantial group of unsophisticated consumers that the items are
imitation pearls. Accordingly, the Commission has revised the Guides to
state that it is unfair or deceptive ``to use the terms `faux pearl,'
`fashion pearl,' `Mother of Pearl,' or any other such term to describe
or qualify an imitation pearl product unless it is immediately
preceded, with equal conspicuousness, by the word `artificial,'
`imitation,' or `simulated,' or by some other word or phrase of like
meaning, so as to indicate definitely and clearly that the product is
not a pearl.'' 265
---------------------------------------------------------------------------
\265\ The comments discussing the use of the word ``faux'' are
discussed in more detail infra.
---------------------------------------------------------------------------
The JVC also proposed adding a new subsection (d) which states that
it is unfair to use the word `pearl' with an asterisk which references
to a footnote explaining that the product is an imitation or cultured
pearl. This proposal is similar to a Note currently in section 23.15 of
the Guides. However, section 23.15(c) states that the word ``pearl''
should be ``immediately preceded'' by a qualifying word such as
``imitation'' or ``cultured,'' if the item is not a natural pearl. The
Commission believes that this language advises sellers about how to
avoid a deceptive use of the term ``pearl.'' The current Note is
superfluous and the Commission has deleted it.
3. Misuse of Other Terms
a. Proposed changes to existing subsections. Section 23.16 of the
current Guides consists of six subsections describing several terms
that can only be used to describe specific types of pearls. The JVC did
not suggest any changes in these sections.266
---------------------------------------------------------------------------
\266\ The JVC did suggest that subsection (b), which relates to
the term ``seed pearl,'' be modified to allow the use of the term
``cultured seed pearl'' or the terms ``simulated,'' ``artificial,''
or ``imitation seed pearl.'' As noted above, the Commission has
concluded that this change is useful and has included it in the
revised Guides.
---------------------------------------------------------------------------
The only comment on these sections referred to Sec. 23.16(e), which
states that it is unfair to use the word ``natura'' or any similar word
to describe a cultured or imitation pearl. CPAA suggested the words
``natural,'' ``nature's,'' and ``organic'' be ``added to the list of
words that cannot be used to describe an imitation pearl product.''
267 CPAA explained that these words have been used to describe
imitation pearls, and argued that they ``only serve to confuse the
consumer and retail buyer as to the proper origin and intrinsic value
of an imitation product.'' 268
---------------------------------------------------------------------------
\267\ Comment 193, p.6.
\268\ Id.
---------------------------------------------------------------------------
[[Page 27203]]
On the other hand, Majorica requested that the Guides be revised to
add a section stating that pearls made from guanine crystals can be
described as ``organic'' pearls. It stated that elimination of the word
``organic'' would eliminate ``the only real competition which cultured
pearls have in this country.'' 269 However, for the reasons stated
above, the Commission has concluded that describing pearls made from
guanine crystals as ``organic'' pearls is likely to mislead consumers.
Nevertheless, there is a difference between the words ``natural'' and
``nature's''--neither of which can inherently be used in a nondeceptive
manner with respect to imitation pearls--and the word ``organic.'' The
Commission believes that the word ``organic'' could be used, with
adequate qualification, to describe Majorica pearls in a truthful
manner. For example, in its ads, Majorica describes its pearls as
``organic man-made pearls'' that consist of a translucent nucleus
``coated with layers of pearlized essence, an organic material
extracted from marine species.'' 270 Thus, the Commission has
revised Sec. 23.16(e) of the current Guides to indicate that it is
unfair or deceptive to use the term ``natural'' and ``nature's'' to
refer to an imitation pearl. The Commission also has added a sentence
to this section stating that it is unfair or deceptive to use the term
``organic'' to refer to an imitation pearl unless the term is qualified
in such a way as to make clear that the product is not a natural pearl.
---------------------------------------------------------------------------
\269\ Comment 240, pp.6 and 11. The section requested by
Majorica would limit the use of ``organic'' to any pearl other than
an imitation pearl made from guanine crystals. Id. at 7.
\270\ Attachment to comment 49.
---------------------------------------------------------------------------
The JVC suggested adding the word ``cultura'' to Sec. 23.16(f) of
the current Guides, which states that it is unfair to use the word
``kultured'' or any similar word to describe an imitation pearl.
However, the section as currently written prohibits the use of ``any
other word, term, or phrase of like meaning * * * .'' The word
``cultura'' is very similar to ``kultured.'' Thus, Sec. 23.16(f)
already provides adequate guidance on how to avoid deceptive
representations. However, CPAA stated that terms such as ``semi-
cultured pearl,'' ``cultured-like,'' ``part-cultured,'' and ``pre-
mature cultured pearl,'' have been used to describe imitation pearls,
and argued that they ``only serve to confuse the consumer and retail
buyer as to the proper origin of an imitation product.'' 271 The
Commission has determined that these terms are deceptive when applied
to imitation products and has included them in Sec. 23.16(f) of the
current Guides.
---------------------------------------------------------------------------
\271\ Comment 193, p.6.
---------------------------------------------------------------------------
b. Additional proposed provisions relating to cultured pearls. The
JVC proposed the addition of six new subsections relating to the
failure to describe a cultured pearl as a cultured pearl. These
proposed subsections relate to fresh water cultured pearls, Biwa
cultured pearls, South Sea cultured pearls, black cultured pearls, and
Mabe cultured pearls.
All of these have been discussed previously, in connection with the
section on definitions, except Biwa pearls (which were not included in
the definition section proposed by the JVC.) As noted, the Commission
has concluded that Sec. 23.15(b) of the current Guides, which states
that it is unfair to use the word ``pearl'' to describe a cultured
pearl unless the word ``pearl'' is ``immediately preceded, with equal
conspicuity,'' by the word ``cultured'' or a word of similar import, is
sufficient to admonish sellers that they should adequately disclose
that a cultured pearl--of whatever type--is cultured. Thus, the
Commission has not included any of these proposed subsections except
the ones dealing with South Sea pearls (discussed supra) and Biwa
pearls.
The subsection proposed by the JVC for Biwa pearls states that it
is unfair to use the term ``Biwa pearl'' without the qualifying term
``cultured.'' The Commission has concluded that this portion of the
proposed subsection is unnecessary. However, the proposed subsection
also provides that ``the term `Biwa cultured pearl' must only be used
when describing those formations which have the distinctive appearance
of a fresh water cultured pearl taken from the fresh water mollusks
inhabiting Lake Biwa within the island of Honshu, Japan.''
CPAA commented that the term should be limited to ``those
formations which are grown in fresh water mollusks in the lakes and
rivers of Japan.'' CPAA stated that the words ``distinctive
appearance'' might allow imitation pearls and pearls from other
countries to use the regional description. CPAA explained that ``Biwa''
represents all Japanese freshwater pearls because ``first, many people
currently refer to all Japanese origin freshwater cultured pearls as
`Biwa'' and second, because freshwater pearl production in Japan is
nearing extinction ``Biwa pearls'' are appreciating in value.272
CPAA stated that many U.S. importers use the term ``Biwa pearl'' ``to
describe freshwater pearls that have a similar appearance to Biwa
pearls but come from other countries such as China'' and artificially
inflate the prices of them, which ``cost as little as 30 times less
than the Biwas.'' 273
---------------------------------------------------------------------------
\272\ Comment 193, p.7.
\273\ Comment 193, p.7.
---------------------------------------------------------------------------
Because of the evidence of deceptive use of this term, the
Commission has included a provision in the Guides stating that the term
``Biwa'' should only be applied to pearls ``which are grown in fresh
water mollusks in the lakes and rivers of Japan.''
c. Other proposed provisions. The JVC proposed that eight other
subsections be added to the section dealing with misuse of specific
terms (in addition to the proposed subsections described above.) The
first such proposed subsection is general: ``It is an unfair trade
practice to use the term `pearl,' `oriental pearl,' `cultured pearl,'
`cultivated pearl' * * * to describe * * * any such pearl product whose
outer surface does not consist wholly of naturally occurring concentric
layers of nacre secreted by that mollusk.'' This section duplicates
other subparts of Sec. 23.16 of the current Guides, and therefore, the
Commission has not included it in the Guides.
Another JVC proposal prohibits the use of the term ``non-nucleated
pearl,'' because ``cultured pearls of this type are formed by the
introduction of mantle tissue within the body of the mollusk'' and thus
are nucleated. However, both the CPAA and AGTA used the expression
``non-nucleated pearl'' in their comments in referring to Keshi
pearls.274 Moreover, whether or not the term ``non-nucleated'' is
correct, no evidence has been offered to show that it is being used to
deceive consumers as to a material fact. Thus, the Commission has not
included this section.
---------------------------------------------------------------------------
\274\ Comment 193, p.8; comment 49, p.15.
---------------------------------------------------------------------------
Two of the additional proposed sections relate solely to imitation
pearls. One states that it is unfair ``to use the term `man-made' or
`man-created' without using the term `simulated' or similar term, to
qualify the product as in `man-made simulated pearls.''' CPAA commented
that this section should state that it is unfair to use these terms
``without also using the term `simulated,' `imitation' or any other
term that has the same connotation and meaning when qualifying or
describing an imitation pearl product.'' 275 The only other
comment relating to this provision was from Majorica, which requested
the FTC ``to withhold any further restrictions on the words `organic,'
[[Page 27204]]
`man-made,' `synthetic,' and `created' while considering the creation
of a new category of pearl to which the word `organic' could properly
and accurately be applied.'' 276 CPAA may be arguing that the
phrase ``man-made'' could be understood to mean cultured pearls, since
such pearls are ``started'' by man. However, there is no evidence that
consumers are interpreting the phrase ``man-made'' or similar phrases
in this manner, and without such evidence, the Commission has decided
not to include the section, as proposed by CPAA, in the revised Guides.
---------------------------------------------------------------------------
\275\ Comment 193, p.6.
\276\ Comment 240, p.6 (emphasis added).
---------------------------------------------------------------------------
Four of the remaining five proposed subsections relate to the
misuse of certain words, which are described in Secs. 23.20 and 23.21
of the current Guides. Section 23.20 of the current Guides provides
that it is unfair to use the words ``real,'' ``genuine,'' ``natural,''
or ``similar terms as descriptive of any article or articles which are
manufactured or produced synthetically or artificially, or artificially
cultured or cultivated * * *.'' Although this section deals primarily
with precious and semi-precious stones, it also applies to cultured or
imitation pearls.
The subsection proposed by the JVC states that it is unfair to use
these words or the word ``precious'' or similar terms to describe
imitation or cultured pearls.
The Commission has reorganized the Guides so that this statement
appears in the pearl section, making it more likely that industry
members searching for guidance as to pearl advertising will see it. As
noted above, the Commission already has included the term ``natural''
in the subsection dealing with the term ``natura,'' Sec. 23.20(e) of
the revised Guides. Thus, the Commission has added a new subsection,
23.20(i), that states that it is unfair or deceptive to use the terms
``real,'' ``genuine,'' or ``precious'' as descriptive of an imitation
pearl.277
---------------------------------------------------------------------------
\277\ Although there was no comment on the inclusion of
``precious'' in this subsection, the Commission has determined that
it is deceptive as applied to imitation pearls because ``precious''
in the jewelry industry implies rarity. Although imitation pearls
can be of high quality, they are not likely to be rare.
---------------------------------------------------------------------------
This subsection does not state that the terms ``real'' or
``genuine'' are unfair or deceptive if used to describe cultured
pearls. The Commission has determined that it is possible to truthfully
describe ``real'' or ``genuine'' cultured pearls without implying that
they are not cultured. In addition, there may be instances when
cultured pearls could be truthfully described as ``precious.''
Therefore, Sec. 23.20(i) is limited to imitation pearls.
Section 23.21(a) in the current Guides states that it is unfair to
use the term ``gem'' or a similar term to describe ``a pearl, cultured
pearl, diamond, ruby, * * * which does not possess the beauty,
symmetry, rarity, and value necessary for qualification as a gem.'' The
JVC proposed a section recommending that the word ``gem'' not be used
as a quality designation or description of natural pearls, ``since
there is no existing criteria for these terms, and their use to
describe, imply, or represent quality could be misleading.''
AGTA commented that this provision should only apply to sales to a
consumer, stating, ``The term `gem' is traditionally used within the
trade to describe particularly fine qualities of any given gemstone
species, including pearls. To prohibit its use within the trade is
restrictive of traditional practice and is unnecessary as it is clearly
understood.'' 278 There is no evidence that consumers would be
deceived by this term as applied to pearls that ``possess the beauty,
symmetry, rarity, and value necessary for qualification as a gem.''
Therefore, the Commission has retained current Sec. 23.21(a) and has
moved the portion relating to pearls to the pearls section of the
Guides (revised Sec. 23.20(j)). The Commission has included a Note
after this section (which currently follows Sec. 23.21(b) in the
current Guides) which states that the use of ``gem'' with respect to
cultured pearls should be avoided since few cultured pearls possess the
necessary qualities and that imitation pearls should not be described
as `gems.'
---------------------------------------------------------------------------
\278\ Comment 49, p.16 (noting that there is not a similar
prohibition of the use of the term `gem' in the section on
diamonds).
---------------------------------------------------------------------------
Section 23.21(c) of the current Guides states that it is unfair to
use the words ``reproduction,'' ``replica,'' or similar terms to
describe a cultured or imitation pearl (or imitation precious or semi-
precious stones.) The JVC proposed including this statement, as it
pertains to pearls, in the pearls section. However, if the nature of
the material used in a reproduction or replica is adequately disclosed,
as advised by other sections of the Guides, it is not clear that the
use of these terms would be deceptive or unfair. Thus, the Commission
has not added this section to the Guides.279
---------------------------------------------------------------------------
\279\ The Commission has deleted Sec. 23.21(c) of the Guides, as
discussed below, in the section pertaining to gemstones.
---------------------------------------------------------------------------
Section 23.21(d) of the current Guides states that the use of the
term ``synthetic'' to describe cultured or imitation pearls is unfair.
The term may be used for precious and semi-precious synthetic stones if
they have ``essentially the same optical, physical, and chemical
properties as the stone named.'' The JVC proposed moving the portion of
Sec. 23.21(d) that pertains to pearls to the pearls section and adding
that it is unfair to use the word ``created'' to describe cultured or
imitation pearls. AGTA and CPAA both supported the proposal, and
Majorica opposed it.280 No evidence was offered to explain why the
use of the term ``created'' is unfair or deceptive as applied to
cultured or imitation pearls. The Commission therefore has not included
the proposed section regarding the term ``created'' in the Guides.
---------------------------------------------------------------------------
\280\ AGTA (49) p.16; CPAA (193) p.7 (suggesting that the
provision be modified to apply to ``cultured, simulated, or
imitation pearls'' rather than to ``cultured or imitation pearls'');
Majorica (240) p.6 (requesting no ``further restrictions'' be placed
on the use of ``created'' or ``synthetic'').
---------------------------------------------------------------------------
However, the term ``synthetic'' has been used with respect to
gemstones to refer to a man-made substance that has all the physical,
chemical and optical properties of the natural stone. Since cultured
pearls do not have the same physical and optical properties as natural
pearls, the use of this term may be deceptive. Furthermore, the use of
the term ``synthetic'' to describe an imitation pearl might convince
some consumers that the pearls were cultured rather than imitation.
Thus, the Commission has included a new subsection, 23.20(k), which
states that it is unfair or deceptive to use the word ``synthetic'' to
describe cultured or imitation pearls.
Finally, the JVC proposed a subsection stating that it is unfair to
use the term ``semi-precious'' to describe any pearl, cultured pearl,
``or man-made industry product.'' No evidence was offered to show that
this use of ``semi-precious'' would be unfair or deceptive, and there
was no comment on this proposal. In the absence of such evidence, the
Commission has decided not to add this provision to the Guides at this
time.
d. Additional provisions proposed by commenters. CPAA proposed that
several additional subsections be added to the section pertaining to
``Misuse of terms.'' First, CPAA suggested a subsection stating that it
is unfair to use the term ``orient'' to describe the properties of an
imitation pearl.281 CPAA stated that ``the term `orient' was first
used in a gemological sense by the Gemological Institute of America in
[[Page 27205]]
order to explain and clarify quality points of natural and cultured
pearls * * * many retailers and gemologists alike hold their [GIA]
definitions to be the authoritative standard within the industry.''
282 However, an article from the GIA quarterly journal Gems &
Gemology was attached to Majorica's comment; the authors are all
employees of GIA. The article states, ``An iridescence resembling the
orient seen on some cultured pearls may also be observed on Majoricas
[an imitation pearl].'' Thus, it appears that at least some imitation
pearls can possess ``orient.'' Therefore, the Commission has not
included this provision in the revised Guides.
---------------------------------------------------------------------------
\281\ Comment 193, p.8 (``Orient is gemologically defined as a
subdued iridescence, occurring when white light is divided into its
separate and distinct spectral colors as it passes through and is
refracted back from the nacre secreted by mollusks whether
surrounding a nucleus or not.'').
\282\ Comment 193, p.9.
---------------------------------------------------------------------------
CPAA also proposed a new provision, stating that it is unfair to
use the terms ``Japanese Pearls,'' ``Mallorca Pearls,'' ``Chinese
Pearls,'' or any other regional designation to describe cultured or
imitation pearls without including the words ``cultured, imitation or
simulated.'' 283 CPAA explained that imitation pearl companies
recently have used regional terms to describe their products, and that
this misleads consumers about the true nature of the product.284
---------------------------------------------------------------------------
\283\ Id.
\284\ CPAA (193) p.9 (explaining, for example, that the ``use of
the term `Misaki Japanese Pearls' in several cases has led consumers
to believe that they were purchasing Japanese cultured pearls
instead of imitation pearl products'').
---------------------------------------------------------------------------
Majorica made a similar suggestion, stating that there is continued
abuse of terms such as ``Mallorca Pearl,'' ``Majorca Pearl,'' and
``Mayorca Pearl'' and that they ``have numerous examples of customers
and distributors who have been deceived into purchasing pearls under
the label of `Majorca' or `Mallorca' pearls believing them to have
special qualities related to the Island of Majorca or, for that matter,
that they are MAJORICA pearls.'' 285
---------------------------------------------------------------------------
\285\ Comment 240, pp.8-10. Unlike the CPAA proposal, Majorica
proposed to prohibit the use of the term ``Mallorca'' or any similar
expression connoting the name of the Island of Mallorca, Spain in
combination with the word pearl. (The CPAA proposal would allow an
imitation pearl to be described as a ``Mallorca imitation pearl.'')
Majorica stated that it has sued distributors of pearls and has
obtained relief which requires such distributors to ``to reduce the
emphasis on [Mallorca] in their advertising and distribution.''
Majorica asserts that it is unfair to require it to go to the
expense of litigation every time such an abuse occurs. Id. However,
Majorica's specific complaint regarding the ``passing off'' of one
manufacturer's product for another is already adequately addressed
by caselaw under Section 5.
---------------------------------------------------------------------------
The Commission has concluded that there is some evidence that
regional descriptions are being used to mislead consumers. The
Commission therefore has included a provision in the revised Guides
that states that the regional description of a pearl should be
accompanied by a description of whether the item is a cultured or
imitation pearl.
4. Misrepresentation as to Cultured Pearls
The JVC recommended no substantive changes in Sec. 23.17 of the
current Guides. As noted above, this section describes unfair practices
involving false, misleading, or deceptive statements about cultured
pearls, including the manner in which they are produced and the
thickness of the nacre coating.
One commenter, Kenneth Russell, recommended that the Commission
establish grades for cultured pearls based on the thickness of the
nacre deposited by the mollusk, following the introduction by man of a
mother-of-pearl bead. He noted that the thickness of the nacre ``mainly
determines their wearable value'' and that this ``indexing''
information should accompany this product ``just as karatage serves to
rank gold jewelry.'' 286 He stated that most cultured pearls
consist of 90 to 95% nucleus and very little nacre.287
---------------------------------------------------------------------------
\286\ Comment 217, p.1 (suggesting that cultured pearls with a
\1/4\ to \1/2\ mm. coating of nacre should be marked ``Service
Grade'' and those with more than \1/2\ mm. marked ``Heirloom
Grade'').
\287\ Id. at p.2.
---------------------------------------------------------------------------
The article attached to the Majorica comment stated that the
thickness of the nacre in a cultured pearl ``will vary depending on the
amount of time the nucleated mollusk was allowed to grow before
harvest.'' 288 The article attached to the Rapaport comment quoted
a pearl industry source as saying that some of the lowest-quality
Chinese pearls should not be on the market because ``the nacre peels
off the nucleus within a year.'' 289 The article notes that pearl
grading is ``a non-standardized process that gives dealers a lot of
room for opinion.'' It also notes that GIA has a grading system which
``uses numerical grades to show differences in appearance, durability
and value of pearl strands'' and that some companies use their own
methods.290
---------------------------------------------------------------------------
\288\ ``Majorica Imitation Pearls,'' Gems and Gemology 187
(Fall 1990), attached to Comment 240.
\289\ ``Rapaport Diamond Report'' 26 (July 17, 1992) attached to
Comment 233.
\290\ Id.
---------------------------------------------------------------------------
The literature indicates that the nacre on some cultured pearls
might be so thin that they do not meet the expectations consumers have
when an item is described as a cultured pearl. Section 23.17 in the
current Guides admonishes against misrepresentations about the
thickness of the nacre on cultured pearls or the quality of pearls.
However, it is not unfair or deceptive to fail to grade cultured pearls
that contain a coating of nacre that is thick enough to meet minimal
consumer expectations.
F. Precious and Semi-precious Stones (Category V): Secs. 23.18-23.21
Guides in this part apply primarily to colored gemstones, precious
(rubies, sapphires, emeralds) and semi-precious (amethyst, topaz, etc.)
stones. The Guides refer to three types of gemstones: natural (i.e.,
mined from the ground); synthetic stones, which are laboratory-created
and which Sec. 23.21(d) describes as having ``essentially the same
optical, physical, and chemical properties'' as natural stones; and
imitation stones, which resemble natural stones but do not have the
same properties.
1. Deception Generally: Sec. 23.18
Section 23.18 states that any material misrepresentation with
respect to precious or semi-precious gemstones is unfair. The JVC
proposal omitted this section. Section 23.18 merely repeats the general
admonition in Sec. 23.1 against material misrepresentations of any
industry product. Thus, the Commission has deleted this provision from
the revised Guides.
a. Disclosure of Treatment
A Note following Sec. 23.18 states that any artificial coloring or
tinting of a diamond or precious or semi-precious stone by ``coating,
irradiating, or heating, or by use of nuclear bombardment, or by any
other means'' should be disclosed and the fact that the coloring is not
permanent, if such is the fact. The JVC proposed, in section 23.20(c)
of its petition, a section in lieu of the Note which requires the
disclosure of any enhancement ``by coating, application of colorless or
colored oil, irradiation, surface diffusion, dyeing, heating or by use
of nuclear bombardment, or by any other means.'' 291 This proposal
would expand the recommended disclosure about enhancements relating to
color to all enhancements (e.g., those related to concealing cracks).
In addition, it explicitly covers enhancement by applications of
colored or colorless oil, surface diffusion, or dyeing.292
---------------------------------------------------------------------------
\291\ Nassau (10) suggested, at p.1, three modifications to the
JVC proposal: the addition of the word ``impregnation'' after the
word ``coating''; the addition of the words ``wax, plastic, or
glass'' after ``colored oil''; and the removal of the word
``surface'' (i.e., in ``surface diffusion'').
\292\ Although most of these techniques enhance color,
application of colorless oil could arguably be used simply to cover
inclusions. The current Guides recommend disclosure of techniques
which artificially color gemstones, and the fact that the techniques
are not explicitly mentioned may lead readers to assume that it need
not be disclosed. Some comments gave this indication because they
assumed that the disclosure of treatment with colorless oil was not
currently advised.
---------------------------------------------------------------------------
[[Page 27206]]
Numerous commenters noted that almost every natural gemstone is
subject to some form of enhancement.293 AGS stated that many new
enhancement techniques have been developed since the Guides were issued
and that ``[c]oating processes are developed daily.'' 294 NACSM
stated that up to 95% of colored gemstones are dipped in oil and that
this treatment is ``taken for granted by retailers and consumers
alike.'' 295 It questioned the value of disclosures under these
circumstances and contended they would clutter written advertisements
and increase prices.296 However, NACAA commented that its members
receive complaints about failure to disclose stone enhancement.297
Although the Guides currently recommend disclosure of color
enhancement, some comments indicated that there is little such
disclosure in the marketplace.298 However, some industry
associations strongly encourage their members to disclose
treatments.299
---------------------------------------------------------------------------
\293\ Lannyte (65) p.8 (also suggesting, at p.10, that the
guides state that it is unfair to state that a gemstone has not been
enhanced when it has been, a suggestion that has been incorporated
into Sec. 23.1 of the revised Guides by including ``treatment'' in
the list of attributes that should not be misrepresented); JGL (77)
p.1; Majestic (115) p.1; Suberi (214) p.2; Bruce (218) p.12; NACSM
(219) p.13; Impex (220) p.1; Best (225) pp.8-9.
\294\ Comment 18, p.2; AGTA (49) p.5 (noting several
technologies (e.g., diffusion-treated sapphires, irradiated topaz)
that ``did not even exist on a commercial scale ten years ago'');
GIA (81) p.2; Eisen (91) p.1; ArtCarved (155) p.1; LaPrad (181) p.1;
IJA (192) p.1.
\295\ Comment 219, p.13 and letter to Secretary, p.1. See also
``Epoxy-Like Resins,'' Jewelers' Circular-Keystone 176 (June 1994)
(stating that ``[t]he majority of emeralds sold today are epoxy
resin impregnated'' and noted that oil and epoxy resin are both
designed to ``soften or hide the effect of cracks and fissures'').
\296\ Id.
\297\ Comment 90, p.1.
\298\ Lannyte (65) p.7; Impex (220) stated that the JVC proposal
would ``defy standard industry practices.''
\299\ See discussion infra of the 1990 Gemstone Enhancement
Manual (attached to comment 49).
---------------------------------------------------------------------------
The Commission is persuaded by the comments that many consumers do
not have detailed knowledge about the nature and types of treatments
used to enhance gemstones. However, consumers would expect their
gemstone purchases to retain their appearance over time regardless of
any treatments and to not require special care to retain their
appearance. On the basis of the comments and for the reasons discussed
below, the Commission has concluded that non-permanent treatments of
various types (not just those that affect color), or any treatments
that create special care requirements should be disclosed. There is no
logical reason to limit disclosure to treatments that affect color.
Further, consumers should be informed when the treatment is not
permanent.300
---------------------------------------------------------------------------
\300\ By letter dated February 7, 1989, the JVC informed staff
that it wished to revise its petition to ``include disclosure in the
colored gemstone provision the permanency and/or non-permanency of
enhancement.''
---------------------------------------------------------------------------
Some comments argued that any treatment, even if it is permanent,
may reduce the value of a stone and a failure to reveal treatment
amounts to a representation that a stone is more valuable than it is.
One commenter noted that treatments should be disclosed ``since the
stone gives the appearance to the consumer that it is a higher grade
than what it actually is.'' \301\ AGTA also stated that ``the
difficulty in detecting treatments presents opportunities for
misrepresentation of the value'' and that ``the potential for
overcharging consumers if the enhancements are not disclosed at every
level of the trade is very real.'' \302\ AGTA attached a May 1993
notice it issued to its members in which it referred to the fact that a
number of knowledgeable wholesalers purchased diffusion-treated
sapphires without knowing that they were treated.\303\
---------------------------------------------------------------------------
\301\ Bales (156) p. 10.
\302\ Comment 49, p. 5 (stating that it sees examples of
overcharging too frequently and listing as ``most notable
examples,'' i.e., diffusion-treated sapphire, Yehuda-treated and
laser-drilled diamonds, and irradiated topaz, sapphire, and
diamond); Chatham (231) p. 24 (stating that consumers are deceived
by treated natural stones that are passed off as more valuable than
they actually are).
\303\ AGTA recommended that diffusion-treated and irradiated
gemstones always be described as ``chemically colored by
diffusion,'' and, if the color does not permeate the entire gem,
that fact should be revealed with a warning that re-cutting or re-
polishing is not recommended. Comment 49, p. 16. However, River
(254) stated, at pp. 2-3, that many people find diffusion treated
sapphire a better value, and that the problem of re-cutting is
``blown out of proportion'' since very few stones are re-cut or re-
polished at a customer's request, and in the rare instance when a
stone is broken, it is replaced. For these latter reasons, the
Commission has not included the language suggested by AGTA (i.e., a
warning about re-cutting or re-polishing) in the Guides. Further, it
is not practical for the Guides to address every conceivable issue
that may arise in a jewelry transaction.
---------------------------------------------------------------------------
On the other hand, Service argued that failure to reveal treatment
is not deceptive if the treatment is permanent, stating, ``[i]t is
unreasonable to require a retailer to disclose what has happened to a
stone in the manufacturing process if the change is permanent.''
Service agreed that if the change is not permanent, the customer
``wants to know if the color or quality may degrade over time and what
the customer must do, if anything, to maintain the stone's quality and
color. Requiring this information to be provided is acceptable.''\304\
---------------------------------------------------------------------------
\304\ Comment 222, p.5.
---------------------------------------------------------------------------
The Commission has concluded that it is not unfair or deceptive to
fail to disclose a treatment that is permanent or that does not create
special care requirements. As the Commission stated in International
Harvester, 104 F.T.C. at 948, it may be deceptive for a seller ``to
simply remain silent, if he does so under circumstances that constitute
an implied but false representation.'' These implied representations
``may arise from the physical appearance of the product, or from the
circumstances of a specific transaction, or they may be based on
ordinary consumer expectations as to the irreducible minimum
performance standards of a particular class of goods.'' Id. The
Commission explained, however, that ``[i]ndividual consumers may have
erroneous preconceptions about issues as diverse as the entire range of
human error, and it would be both impractical and very costly to
require corrective information on all such points.'' Id. at
949.305 Thus, if an express or implied representation is made (in
advertising or at the point of sale) that might imply rarity and
therefore lack of treatment--e.g., that the gemstones are of an
exceptionally high quality--then the failure to reveal any treatment
may be deceptive. However, if no such representation is made, consumers
simply might not give any thought to whether the gemstones were
treated, beyond assuming that all gemstones undergo some processing to
achieve their finished state. Therefore, it is neither unfair nor
deceptive to fail to reveal treatments that are permanent, and that do
not create special care requirements.306
---------------------------------------------------------------------------
\305\ Numerous comments noted that disclosure of treatment of
all gemstones would be expensive for retailers. Service (222) p.5
(stating this is difficult because the stone probably changed hands
a few times before being purchased by the retailer); Best (225) p.9
(stating that the retailer may not know of the enhancement); Finlay
(253) p.2 (stating that it would be an ``overwhelming task'' for the
retailer to obtain information about enhancement from the
manufacturers). Others commented (without further explanation) that
disclosure would ``complicate'' sorting, advertising, and selling.
Philnor (93) p.1; PanAmerican (101) p.1; Fame (102) p.1; Orion (113)
p.1; Precision (121) p.1.
\306\ The Commission does not believe that it would be unfair to
fail to disclose the treatments because, even assuming there might
be some consumer injury associated with such failure, the injury
would be outweighed by the benefits to competition, see supra note
305, associated with not requiring the disclosure. See International
Harvester, 104 F.T.C. at 949.
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[[Page 27207]]
Nevertheless, most treatments of gemstones are not permanent, and
most treatments create special care requirements. AGTA attached to its
comment a copy of the 1990 Gemstone Enhancement Manual, which states,
at p.3, that it was ``developed by a coalition of jewelry industry
leaders representing the various trade organizations, gemological
scientists, and the trade press.'' This Manual gives examples of
treatments that are not permanent, or that create special care
requirements.307 What appears to be the most common treatment--
oiling--is definitely not permanent.308 Although a new treatment
with epoxy resin ``leads to a longer lasting improvement in appearance
which is not possible with volatile compounds like oils and paraffin
used traditionally,'' experts have suggested that a number of problems
may occur even with this treatment and that disclosure is necessary
because otherwise a seller ``could easily ask a price commensurate with
a stone's appearance.'' 309
---------------------------------------------------------------------------
\307\ For example, the Manual states that emeralds are usually
oiled with colorless oil to improve appearance; the stability of
this treatment is described as ``fair to good.'' According to the
Manual, oiled emeralds should not be subjected to temperature
changes, steaming, chemicals, or ultrasonic cleaning machines.
Moreover, numerous other stones that are commonly treated to improve
appearance (e.g., Amazonite--usually waxed; Jadite--impregnated with
colorless wax; Lapis Lazuli--impregnated with colorless wax or oil;
Malachite--coated with wax) should not be cleaned in ultrasonic
machines, according to the Manual. Ultrasonic cleaning machines are
now sold to the general public by mass retailers.
\308\ An article entitled ``Emeralds'' in National Geographic,
Vol. 178, July 1990, stated that oiling of emeralds probably lasts
from a few months to a year or two ``if the emerald is kept away
from heat and out of the sun.'' Id. at 68. The oiling process
involves submerging vials of emeralds in boiling water and then
placing the vials in a pressure chamber to drive the oil even deeper
into the cracks in the emeralds. This is not a process that the
average consumer could repeat. The article noted, at another point,
that the oil evaporates or seeps out ``within a year or two'' and
that oiling ``can puzzle and dismay emerald owners.'' Id. at p.49.
\309\ ``Epoxy-Like Resins,'' supra, at 177. The article quotes
experts who suggest that the filler may be harder to take out if it
deteriorates and changes color, that it may turn cloudy over time,
or that it may cause stress and increase the chances of gem
breakage. Id. at 178.
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Further, as noted above, most consumers probably do not have
detailed knowledge about the nature and type of treatments that are
used to enhance gemstones. Therefore, if consumers are unaware of the
non-permanency of a treatment or the special care requirements
associated with a treatment, the gemstone may not meet their
expectations if the color fades or inclusions appear, etc. Accordingly,
the Commission has included a section in the revised Guides that states
that non-permanent treatments and treatments that create special care
requirements should be disclosed. This section explicitly states that
certain treatments, such as application of colored or colorless oil or
epoxy-like resins, surface diffusion, or dyeing, should be disclosed
because they usually are either not permanent or create special care
requirements. This recognizes that whether a treatment is permanent or
invokes special care requirements may be dependent on factors such as
the type of gemstone that is treated.
Several commenters noted that the current Guides do not specify
whether disclosure of treatment should appear in advertising (as
opposed to at the point of sale). Several retailers commented that
disclosure of enhancement in advertising would be burdensome and would
have a disparate impact on large chains, which do advertise, as opposed
to small jewelry stores, which generally do not advertise. NRF
suggested that whatever enhancement disclosures are required should be
limited to the point of sale.310 Because the potential deception
arises due to the appearance of the product, the Commission has
determined that disclosure at the point of sale is adequate to prevent
the deception, except in the case of any solicitations where the
product can be purchased without first viewing it (e.g., mail, on-line,
or telephone orders). In those cases there should be disclosure that
stones have been treated in the solicitation or, in the case of
televised shopping programs, on the air.
---------------------------------------------------------------------------
\310\ NACSM (219) pp.9, 10, 13; Best (225) p.8; NRF (238) p.2.
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b. Disclosure of special care requirements. The current Guides do
not recommend the disclosure of special care requirements for treated
stones, and the JVC petition did not propose that special care
requirements be disclosed. However, the permanency of some treatments
is dependent on the care exercised by the consumer. The FRN solicited
comment on whether the Guides should advise sellers to disclose to
consumers in writing any special care requirements and whether the
method of disclosure should be specified.
Thirty-four comments addressed this issue. Seventeen comments
stated that the Guides should not require such disclosure, with several
stating that it would be a costly burden for the retailer.311
Eleven commenters favored the disclosure of special care
requirements.312 GIA and three other commenters stated that the
Guides should require such disclosures if the stability of the
enhancement may be affected by the care provided.313 AGTA and CPAA
both stated that they advocated responsible communication between
retailers and their clients as to special care, but they deferred to
the opinion of retail jewelers as to whether this should be required by
the Guides.314 AGTA suggested appending the current edition of the
industry's Gemstone Enhancement Manual to the FTC guides to advise the
industry about the current methods being used.315
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\311\ JMC (1); Thorpe (7); Capital (19); G&B (30); Lannyte (65);
Nowlin (109); McGee (112); Bridge (163); LaPrad (181); IJA (192);
Bedford (210); Matthey (213); NACSM (219); MJSA (226); Preston
(229); Sheaffer (249); and Solid Gold (261). Some of these comments
indicated that such disclosure should be recommended, rather than
required.
\312\ Honora (15); Argo (17); AGS (18) p.3 (stating that
``professional jewelers routinely disclose special care
requirements''); Estate (23); Jabel (47) p.2 (suggesting that the
``stone manufacturer might supply a `care and feeding' card for
every type of stone he handles''); Skalet (61); NACAA (90);
ArtCarved (155); Bales (156); Shire (221); and Leach (257).
\313\ Comment 81, p.3; Schwartz (52) p.3 (stating that there
should be disclosure since ``many, if not most, of gemstone
enhancements are unstable . . . .''); Bruce (218) p.12 (stating that
``it is only when a stone is not permanently changed and may revert
back to another color or shade that a ticket should be attached
letting the consumer know of this, as well as other precautions'');
Service (222) p.3 (stating that it does not oppose disclosing ``the
need for any particular care of a gemstone to insure its continued
quality in appearance'').
\314\ AGTA (49) and CPAA (193).
\315\ Comment 49, p.10 (stating that the Manual, unlike the
Guides, is revised frequently and ``if the guides attempt to address
specific enhancements, the information may be obsolete before
changes could be incorporated at the federal level''). But see River
(254) p.2 (stating that the Manual uses letter codes to describe
treatment, which it described as ``an arcane method of
communicating'').
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However, none of the comments explained why failure to disclose
special care requirements would be unfair or deceptive. Although
failure to reveal a fact material to consumers can constitute deception
by omission, the Commission has determined that it is not inherently
deceptive to fail to reveal special care requirements. First, as
discussed supra, the Commission has revised the Guides to state that
sellers should disclose enhancements that result in special care
requirements. Therefore, having been informed that the stone was
``enhanced,'' a consumer acting reasonably in the circumstances could
be expected to inquire about the process and its permanence, and that
inquiry should result in disclosure of special care requirements. For
example, Capital commented that ``as long as enhancement is faithfully
disclosed, special care requirements will also be disclosed,'' since
consumers will ask for
[[Page 27208]]
instructions and retailers will offer them to avoid future
problems.316
---------------------------------------------------------------------------
\316\ Comment 19, p.2 (noting that trade associations provide
the industry with material on disclosing care information, and that
it is not necessary to include this in the Guides).
---------------------------------------------------------------------------
Furthermore, according to the Gemstone Enhancement Manual, attached
to the AGTA comment, special care requirements are quite common for
many types of unenhanced stones. The Guides have not recommended the
disclosure of special care requirements for these unenhanced stones.
Because unenhanced stones have been sold for many years, the Commission
presumes that over time consumers have become familiar with their
characteristics and their care requirements. Similarly, consumers may
expect that enhanced stones would require certain care requirements
too. Therefore, the Commission believes that if the enhancement is
revealed, it is not inherently unfair or deceptive to fail to reveal
special care requirements. (Consumers who request, but do not receive
special care requirements, presumably will choose to take their
business elsewhere. Thus, sellers should have an incentive to provide
such information.) However, since enhanced stones that have special
care requirements are newer products in the marketplace, and consumers
may not be as familiar with the requirements of these stones, the
Commission has recommended that the seller disclose special care
instructions to the consumer.
2. Deceptive Use of Names of Specific Stones: Sec. 23.19
Section 23.19(a) in the current Guides states that it is unfair to
use the unqualified name of a precious or semi-precious stone to
describe a product which is not a natural stone. This section is not
changed in the revised Guides (Sec. 23.23(a)).
Section 23.19(b) states that it is unfair to use the name of a
precious or semi-precious stone (or the words ``stone'' or
``birthstone'') to describe a synthetic, imitation or simulated stone
unless the name is immediately preceded by the word ``synthetic,''
``imitation,'' or ``simulated,'' whichever is applicable, or by some
other word or phrase of like meaning, so as to disclose the fact that
it is not a natural stone.\317\
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\317\ A Note following this section states that qualifying these
terms by means of an asterisk, which reference a footnote
explanation, ``is not to be regarded as compliance with the
requirements of this section.'' The Commission believes that this
section, which states that a qualifying term should immediately
precede the name of the stone, adequately advises sellers of the
proper disclosure. The Note is superfluous and the Commission has
deleted it.
---------------------------------------------------------------------------
Both the current Guides and the JVC petition allow the use of
``synthetic'' or words or phrases of like meaning to describe created
stones that have the same properties as a natural stone. The purpose of
this section is to prevent the deceptive impression that an item is a
natural stone, and any word or words that accomplish that goal are
acceptable. In Chatham Research Laboratories, 64 F.T.C. 1064, 1075
(1964), the Commission found that the phrase ``Chatham-Created
Emeralds'' was not deceptive because the reasonable inference from the
phrase was that ``such emeralds are Chatham created and must therefore
be synthetic since they are not created by nature.'' Chatham's comment
stated that after almost 30 years of use, there is no evidence that
``Chatham-created'' is deceptive to consumers.\318\
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\318\ Comment 231, p.5.
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AGTA commented, however, that there should be no acceptable
synonyms for the word ``synthetic.'' \319\ Other comments argued that
the Guides should specifically identify terms other than ``synthetic''
that can be used, such as ``laboratory created,'' ``created,'' or
``cultured.'' AGL noted that it introduced the term ``Laboratory Grown
(Synthetic)'' some time ago because it seemed obvious that this would
``increase the ability of a retailer to explain and the capacity of
consumer to understand the basic differences between glass/plastic,
i.e., imitations, and those products that are laboratory grown to
emulate the characteristics and properties of a natural material.''
\320\
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\319\ Comment 49, p.17.
\320\ Comment 230, p.3. AGL also noted that the colored stone
industry opposed this change, citing ``the historical, `universally
understood' application of the term `synthetic.''' However, AGL
stated that there is a ``conscious desire to leave the consumer in a
quandary regarding the difference between `synthetic' and
`imitation' products. . . . to reduce the capacity of the synthetic
material manufacturer to penetrate the U.S. marketplace with their
products.'' Id.
---------------------------------------------------------------------------
Chatham and numerous other commenters also suggested that synthetic
stones appropriately could be described as ``cultured.'' Chatham,
Kimberley, and Crystal argued that this term should only be used for
synthetics that were created by the ``hydrothermal'' or ``flux'' method
(which they use).\321\ Others argued that synthetics made by the
``melt'' or ``flame-fusion'' process also should be allowed to describe
the stones as ``cultured.'' \322\
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\321\ Chatham (231) pp.2, 31; Crystal (24) pp.1, 4; Kimberley
(227) p.7 (stating that the hydrothermal process is the same process
that creates ``natural'' emeralds); Matlins (205) pp.2-3, favored
the use of terms such as ``created'' or ``laboratory-grown'' for
flux-grown synthetic gems only, which she described as being very
different from melt or ``flame-fusion'' synthetic products, in that
the flux-grown products look more like natural stones and are more
expensive to produce. Manning (159) p.2, which uses the melt method
to produce rubies, argued that solution growers [by which it appears
to be referring to flux-growers] should be allowed to describe their
products as ``cultured'' and melt growers to describe their products
as ``created'' or ``lab-grown'' because ``without the ability of
solution growers to somehow separate their process from ours in fair
descriptive language, they will be forced from the marketplace as
too costly for the market to bear.'' Diamonique (224) p.3, stated
without elaboration, that it favored ``cultured'' for gemstones that
were produced by a method ``which replicates that growth process of
natural gemstones.''
\322\ ICT (189), which makes gemstones by the melt method,
stated at p.3, that it objected to ``reserving the word `lab-
created,' `lab-grown,' or `created,' to describe flux or
hydrothermal methods of growth only.'' Service (222) stated, at p.2,
that it is ``unfair to allow sellers of low quality created stones
to use the same term for their product as is used for the highest
quality of created stones'' but suggested this issue should be
addressed in a ``separate rulemaking.'' Friedman (234) stated, at
p.3, that ``cultured'' would communicate to consumers ``that they
were purchasing a true, high-value gemstone, identical to a natural
gemstone and made by a process which included human intervention.''
It apparently favored the use of ``cultured'' for both types of lab-
created stones.
---------------------------------------------------------------------------
Although some companies have used the term ``cultured'' to describe
their products for some time,\323\ no actual evidence about consumer
perceptions arising from the use of a term such as ``cultured ruby''
was submitted. However, in Chatham Research Laboratories, 64 F.T.C. at
1074, the Commission found that the phrase ``Chatham Cultured
Emeralds'' was deceptive. Further, several commenters indicated that
they regarded the term ``cultured emerald'' as deceptive.\324\ Because
there currently is insufficient evidence as to consumer perceptions
regarding the use of the term ``cultured,'' the Commission has not
included the term in the Guides as a ``safe harbor'' (e.g., an example
of an adequate disclosure). Furthermore, the Commission has concluded
that there is not enough evidence in the record to establish ``safe
harbor'' terms by which makers of flux-grown gems could distinguish
their products from other created gems. However, such manufacturers can
distinguish their products from others by means of truthful
advertising.
---------------------------------------------------------------------------
\323\ Crystal (24) p.3 (stating that it uses the term
``cultured'' to describe its ``Ramura Cultured Ruby''); Chatham
(231) p.31 (stating that Crystal and Emsprit Cultured Emeralds have
been using the term ``cultured'' for flux-grown gems).
\324\ Krementz (208) p.1; Shire (221) p.1; River (254) p.3.
---------------------------------------------------------------------------
Similarly, the Commission has determined that there is not
sufficient evidence with respect to the consumer interpretation of a
phrase such as ``created emerald'' (as opposed to
[[Page 27209]]
``laboratory created'' or ``Chatham-created'') to justify including it
in the Guides as a safe harbor. As River stated, the description
``laboratory grown'' is clear immediately, without further explanation.
However, terms such as cultured, created and synthetic ``are not as
clear to the general public and are more often misunderstood because
they are not part of the common vocabulary in the special sense in
which we use them.'' \325\
---------------------------------------------------------------------------
\325\ Comment 254, p.3.
---------------------------------------------------------------------------
Chatham argued that most consumers ``understand synthetic to mean
fake, artificial, and otherwise of low quality.'' It also stated that
it is essential that it ``be able to honestly and accurately educate
consumers that the only difference between its gemstones and natural is
the environment in which the crystals grow.'' \326\ The Commission is
persuaded that the term ``synthetic,'' as applied to gemstones, is
misunderstood by some consumers to mean something fake or artificial.
Therefore, the Commission has included the phrases ``laboratory
grown,'' ``laboratory-created,'' or ``[manufacturer name]-created'' in
the revised Guides (now Sec. 23.23).\327\ Although the Commission has
determined that these terms more clearly communicate the nature of the
stone, sellers can still use the term ``synthetic.'' The Commission has
also included an admonition against misusing the terms ``laboratory-
grown,'' ``laboratory-created,'' or ``[manufacturer name]-created.''
---------------------------------------------------------------------------
\326\ Comment 231, pp.2, 5, 22; Manning (159) p.4 (stating that
there is no way to change the public misunderstanding of
``synthetic''); River (254) p.3 (stating that consumers
misunderstand ``synthetic,'' and noting that ``their greatest
experience is with synthetic fabrics'' so that ``it is difficult for
a clerk in a retail store to explain that gemologists have a special
meaning for the word synthetic'').
\327\ Although the revised Guides no longer list the word
``synthetic,'' some consumers may know the technical meaning that
has been attributed to the word in the context of gemstones for many
years, and they might be deceived into thinking that imitation
stones described as ``synthetic'' have the same physical and optical
properties as natural stones. Thus, the Commission has determined
that the provision which limits the use of the word ``synthetic'' to
certain circumstances continues to be useful.
---------------------------------------------------------------------------
The JVC also proposed adding a Note stating that if the term
``created'' is used to describe a synthetic stone, ``the name of the
firm or company using this product-term must be disclosed in equal
prominence and size type as the term `created' . . . [and] must be
separated from the term `created by a dash (-) so as clearly to
disclose the stone is man-made, i.e., Chatham-Created Emerald.'' AGTA
proposed prohibiting any synonym for ``synthetic,'' but urged that, if
the Commission decided to allow the continued use of the term
``created,'' then ``the precise language'' from the Chatham action
should be incorporated into the Guides.\328\ The effect of the Note
proposed by the JVC (and ``urged'' by AGTA) would be to prohibit the
use of ``created'' except in precisely the form mandated by the Note.
However, there is no evidence as to how most consumers interpret a
phrase such as ``created emerald.'' The Commission has thus determined
that there is no basis for advising against all but one specific use of
the term
FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
``created.'' However, although the terms ``laboratory
created'' and ``[manufacturer name]-created'' will be included in the
list of ``safe harbor'' terms, the term ``created'' alone will not be
included in this list.
---------------------------------------------------------------------------
\328\ AGTA (49) argued, at p.17, that a phrase such as ``A
`Chatham-created emerald ring' implies not that the emerald was
created, but that the ring was manufactured by Chatham.'' (Emphasis
added.) However, it provided no evidence that consumers interpret
the phrase in that manner. If manufacturers or sellers of these
items have reason to believe that consumers are misinterpreting this
phrase, it would be unfair or deceptive not to correct the
misunderstanding.
---------------------------------------------------------------------------
In the FRN, the Commission also sought comment on whether foreign
words or phrases like ``faux'' should be added ``to the list of terms
in Section 23.24(b) [of the JVC petition] that are not to be used to
describe industry products.'' Thirty-five comments addressed this
question.\329\ The Postal Service stated that ``faux'' has been used
``by disreputable promoters to confuse unsophisticated consumers and
enhance the apparent value of their costume jewelry.'' \330\ Three
other commenters stated that ``faux'' is only used to deceive and
should be prohibited.\331\ Six commenters, including NACAA, stated that
``faux'' should be prohibited because some consumers do not know what
it means.\332\ Three stated that ``faux'' is confusing and
misleading.\333\ Thirteen other comments stated that ``faux'' should be
prohibited but provided no reasons.\334\ Nine comments believe the use
of ``faux'' to describe industry products should be acceptable.\335\
---------------------------------------------------------------------------
\329\ Only one of the comments focused on the issue of whether
foreign words or phrases should be added to the list of terms that
are not to be used to describe industry products. Sheaffer (249)
stated, at p.5, that it is not necessary ``to identify and specify .
. . the many foreign terms which might be misleading if used in
connection with an industry product'' but instead believed it more
desirable to add a general admonition that it would be unfair or
deceptive ``to use any foreign term which may be accurate and
appropriate in its native language'' but which is not otherwise
generally used or understood.
\330\ Comment 244, p.3.
\331\ Schwartz (52); Bridge (163); and CPAA (193).
\332\ Honora (15); Skalet (61); NACAA (90); Bedford (210); MJSA
(226); and Preston (229). Bedford stated that a consumer might think
that ``faux'' refers to the color of a ``faux emerald.''
\333\ AGTA (49); Bruce (218); and Shire (221). AGTA gave an
example, at p.11, of a consumer who thought that ``faux'' referred
to the place of origin of a ``faux emerald.''
\334\ JMC (1); Fasnacht (4); Sibbing (5); AGS (18); Estate (23);
G&B (30); GIA (81); Nowlin (109); McGee (112); LaPrad (181); Lange
(183); IJA (192); and Leach (257).
\335\ Lannyte (65); Ross-Simons (67); ArtCarved (155); Bales
(156); NACSM (219); ICT (189); Service (222); Best (225) and
Franklin Mint (250). Two of these [NACSM (219) and ICT (189)] stated
that ``faux'' has become part of the English language. Ross-Simons
(67) stated that ``faux'' should be permitted because it romances
the merchandise without deception.
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The evidence shows that many unsophisticated consumers do not know
what the word ``faux'' means and that it has been used to deceive them.
Thus, the Commission has added a Note to the Guides that states that
the use of the word ``faux'' to describe a laboratory-created stone is
not regarded as an adequate disclosure of the fact that it is not a
natural stone.
Finally, the JVC proposed the addition of a Note [following
petition section 23.22] that states that descriptive words relating to
species and varieties of gemstones must be in conformance with approved
gemological terminology. No evidence was offered to show that there is
a need for guidance in this area.336 Thus, the Commission has not
added this Note to the revised Guides.
---------------------------------------------------------------------------
\336\ There was little comment on this suggestion. Lannyte (65)
stated, at p.11, that ``it is totally inappropriate for a school to
be THE authority on descriptive names as names will develop from
within the trade usage in the same way as language usage changes.
This smacks of censorship!''
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3. Misuse of the Words ``Real,'' ``Genuine,'' ``Natural'': Sec. 23.20
Section 23.20 states that it is unfair to use the words ``real,''
``genuine,'' ``natural,'' or similar terms, to describe any ``articles
which are manufactured or produced synthetically or artificially, or
artificially cultured or cultivated,'' if such use is likely to deceive
consumers. The JVC has proposed [in section 23.23(a) of its petition]
expanding this section to include the words ``precious'' or
``cultured'' and to state that ``it must clearly be disclosed that a
man-made industry product is not a gemstone.'' For the reasons
discussed above, the Commission has not included the word ``cultured''
as a ``safe harbor'' term to describe man-made gemstones. However,
there is not sufficient evidence to advise against the use of
``cultured'' as applied to synthetic gemstones. Further, there is no
evidence that it is being applied to imitation gemstones, where its use
is more likely to be misleading. Thus, the Commission
[[Page 27210]]
has not added the word ``cultured'' to this section of the Guides.
The Commission, however, has determined that the term ``precious''
337 is deceptive when applied to synthetic or imitation gemstones
because it implies rarity. Because synthetic or imitation gemstones can
be produced in virtually unlimited quantities, they are not ``rare'' or
``precious'' like natural gemstones. Therefore, the Commission has
included the word ``precious'' in this section (Sec. 23.24 of the
revised Guides).
---------------------------------------------------------------------------
\337\ ``Precious'' stones are diamonds, emeralds, rubies, and
sapphires. All other gemstones are ``semi-precious.''
---------------------------------------------------------------------------
The JVC also proposed (in section 23.23(b) of its petition) a
section which would in effect prohibit the use of the term ``semi-
precious'' to describe any gemstones. The Commission has determined
that ``semi-precious'' is deceptive when applied to synthetic or
imitation gemstones (because it implies they occur naturally) and has
included it in Sec. 23.24 of the revised Guides.338 The proposal
to ban its use as to natural gemstones is discussed below, as is the
proposal that the Guides state that ``it must clearly be disclosed that
a man-made industry product is not a gemstone.''
---------------------------------------------------------------------------
\338\ Several comments that opposed banning ``semi-precious''
stated that its use with respect to synthetic or imitation gems
would be confusing. AGTA (49) p.11; Schwartz (52) p.3; GIA (81) p.4;
MJSA (226) p.10.
---------------------------------------------------------------------------
4. Deceptive Use of ``Gem'' and ``Synthetic'': Sec. 23.21
Section 23.21(a) in the current Guides states that it is unfair to
use the word ``gem'' to refer to a pearl or a stone (whether precious
or semi-precious) ``which does not possess the beauty, symmetry,
rarity, and value necessary for qualification as a gem.'' Section
23.21(b) states that the word ``gem'' may not be used to describe a
synthetic product unless that product meets the requirements of
23.21(a) and ``unless such word is immediately accompanied, with equal
conspicuity, by the word `synthetic,' or by some other word or phrase
of like meaning.* * *'' A Note to section 23.21 states that ``few
cultured pearls or synthetic stones possess the necessary
qualifications to properly be termed `gems' '' and that the use of the
word ``gem'' therefore should be avoided. The Note also states that
imitation pearls, diamonds, and other stones should not be described as
``gems.'' Finally, the Note states that ``Not all diamonds or natural
stones, including those classified as precious stones, possess the
necessary qualifications to properly be termed `gems.' ''
The current Guides do not contain any admonitions as to the use of
the words ``gem stone'' other than the general admonition, in
Sec. 23.18, against misleading representations used in connection with
the sale of precious or semi-precious gemstones. Under the current
Guides, few if any synthetic stones are likely to qualify as ``gems,''
but synthetic stones may be described as ``gemstones'' (for example, in
an advertisement for various varieties of stones), as long as the term
is so qualified as to disclose that the product is not a natural
stone.339 In addition, the Guides allow lower quality natural
stones, which do not possess ``the beauty, symmetry, rarity, and value
necessary for qualification as a gem'' to be referred to as gemstones
as long as they are not of such low quality (e.g., industrial quality
stones) that it would be deceptive to so describe them.
---------------------------------------------------------------------------
\339\ A synthetic stone is not likely to meet the rarity
criterion necessary to be described as a gem, although it is
conceivable that a particularly beautiful and difficult to create
stone could meet the rarity criterion. In a separate section of its
petition [23.24(a)], the JVC also proposed the addition of a section
that states that it is unfair to use the word ``gem'' to describe a
synthetic or imitation stone. Diamonique (224) noted, at p.4, that
``there are differing quality levels with natural gemstones, as
there are with man-made gemstones. If the term `gem' is appropriate
for natural material, it should also be appropriate for man-made
material.'' The Commission has determined that the word ``gem'' may
be appropriately used to describe a synthetic stone and has not
added the proposed section to the Guides.
---------------------------------------------------------------------------
The JVC proposed changing this scheme. It proposed that the Guides
state that the word `gem' should not be used as a quality designation
of gemstones. It also proposed that a definition of ``gemstone'' be
added to the Guides, along with a provision stating that it is unfair
to use the word ``gemstone'' to describe any object that does not meet
the definition. The JVC defined gemstone as ``a naturally occurring
substance which has been carefully fashioned into a jewel suitable for
use in jewelry, for personal adornment, display, etc. A gemstone
possesses beauty, rarity, durability and value.''
This definition is similar to the definition of ``gem'' in the
current Guides but it limits the use of ``gemstone'' to natural cut and
polished stones, suitable for use in jewelry, that are also durable.
The JVC has provided no evidence indicating that industry members or
consumers have misunderstood the definition of ``gem'' in Sec. 23.21 in
the current Guides, nor has it provided any evidence as to why the
definition it suggests for ``gemstone'' (which omits symmetry and adds
durability to the qualities a gem must possess and excludes any
synthetic stone) is more accurate or useful than the definition of
``gem'' in the current Guides.
The part of the proposal that would prevent natural stones from
being described as gemstones unless they possessed beauty, rarity,
durability and value was not discussed by most comments. However, the
House of Onyx stated, ``This is a broad statement that, if taken
literally, would eliminate the vast majority of the Gemstones currently
in the market.'' 340 For example, under the scheme proposed by the
JVC, a natural emerald that did not possess, e.g., rarity, would not be
a gemstone. The Commission has determined to retain the current Guides,
which allow lower quality natural stones, which do not possess ``the
beauty, symmetry, rarity, and value necessary for qualification as a
gem'' to be referred to as gemstones.341
---------------------------------------------------------------------------
\340\ Comment 162, p.2 (adding, at p.3, that most gemstones are
not durable ``in the true sense of the word,'' citing as examples
amber, ivory, malachite, lapis lazuli, coral pearls, cameos,
sodalite, and turquoise).
\341\ One comment suggested that the words ``rarity and value''
be deleted from the current definition of gem in Sec. 23.21, arguing
that beauty and durability are the two basic properties of all
gemstones. Lannyte (65) pp.6, 11. However, this comment appears to
have confused the definition of ``gemstone'' with ``gem.'' As noted,
the current Guides suggest only a very limited use of the word
``gem'' is appropriate.
---------------------------------------------------------------------------
The proposed definition of ``gemstone'' also would prevent
synthetic stones from being described as ``gemstones.'' The FRN
solicited comment on this proposal. AGS commented simply that it is
essential ``that a like size declaration of the words `synthetic,
imitation, etc.' accompany the description of the stone.'' 342
Service commented that the proposed definition of gemstone ``is not
needed to avoid deception of the consumer. As long as the consumer is
ultimately advised whether or not the stone was naturally occurring * *
* the interest in full disclosure has been satisfied.'' 343 Best
noted that ``gemstone'' is ``loosely used in the industry today to
refer to both naturally occurring and laboratory
[[Page 27211]]
manufactured stones.'' 344 Friedman stated, ``[t]o our customers,
the laboratory grown gems have gained acceptance as, and are,
gemstones.'' 345 Chatham noted that it has used the terms
``gemstone'' and ``gem'' virtually from its inception in 1946 and that
the terms ``have been adopted and widely used by tradespeople in the
jewelry industry * * * To date there has not been any suggestion (other
than by the JVC) that consumers have been misled thereby.'' 346
Chatham also noted that the proposal would place Chatham gemstones ``at
a competitive disadvantage vis-a-vis their natural counterparts and
would do so for no justifiable reason.'' 347
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\342\ Comment 18, p.3.
\343\ Comment 222, p.4 (noting that this proposal creates
problems for ``fair and competitive advertising''); Franklin (250)
p.6 (stating that there is no reason the term should not be used for
laboratory-created stones as long as it is properly qualified);
Lannyte (65) p.9, 10 (asking ``How does one refer to gemstones made
by man when discussing them generically?'' and suggesting that the
Guides provide that it is unfair to use the word ``gemstone'' to
refer to a synthetic stone without disclosing that it is ``not the
unassisted product of nature'').
\344\ Comment 225, attachment at p.8.
\345\ Comment 234, p.2. Freidman did suggest that imitation gems
should not be defined as gemstones. Id. at 3.
\346\ Comment 231, p.5. Chatham also attached a declaration from
Robert Miller, a merchant who has sold both Chatham-created
gemstones and natural gemstones for ten years. He stated that a
prohibition on the use of the words ``gem'' or ``gemstone'' ``would
be inconsistent with current trade practice, in which the words
`gemstone' and `gem' are an integral part of the marketing of
Chatham products, as well as most other jewelry'' and that
``prohibiting sellers from using these common-place terms would hurt
our ability to communicate with our customers about the very nature
of Chatham products'' and that the end result ``would be confusion
on the part of consumers who would wrongly perceive that the
prohibition is a negative reflection on the quality of Chatham
gemstones.'' Miller declaration para. 8 and 9. Chatham also attached
a declaration from Dr. Frederick Pough, who received a Ph.D. in
Mineralogy from Harvard in 1935 and who has authored hundreds of
articles on mineralogy. He states that the definitions proposed by
the JVC ``would represent a dramatic departure from the way in which
the terms `gemstone' and `gem' have been understood and used in the
trade and in gemological circles for several decades'' and ``as it
is currently and loosely used, and as it has been used for years,
the term `gemstone' does not identify the source of the stone, or
whether or not it is a `naturally occurring substance.''' Similarly,
he stated ``under no current definition of `gem' of which I am
aware, is the term limited to `naturally occurring substances.'''
Pough declaration para. 8, 9, and 13.
\347\ Comment 231, pp.5, 9. The eight other commenters who sell
significant quantities of synthetic gemstones also believe it is not
deceptive to use the term for synthetic stones as long as it is
qualified to indicate that the stones are not natural stones:
Crystal (24); Union Carbide (38); Manning (159); ICT (189);
Kimberley (227); Friedman (234); Kyocera (242); and River (254).
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Although many commenters supported the JVC proposal, few gave any
reason beyond stating that ``synthetics are not natural.'' GIA agreed
that ``gemstone'' should be limited to natural stones because it
implies that the material occurred in nature.348 AGTA stated that
synthetics ``emulate and often approximate the appearance of and have
similar durability to that of natural gemstones,'' but they lack
rarity, and allowing them to be referred to as ``gemstones'' will
``further blur the distinction in the consumer's mind as to the
important differences between the two. In all probability, this will
result in higher consumer prices for synthetic and simulated
materials.'' 349 Other commenters agreed that synthetics should
not be described as gemstones.350
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\348\ Comment 81, p.3 (stating ``We consider this to be of
minor importance, but believe neither stone nor gemstone should be
used to describe an artificial product.'').
\349\ Comment 49, p.9.
\350\ One of these, LaPrad (181) stated, at p.3, that
``gemstone'' should also be prohibited as descriptive of any
artificially colored natural stone.
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The current Guides permit the use of, e.g., ``synthetic ruby'' or
``imitation ruby.'' The Commission is persuaded that consumers would
understand that gemstones described as ``laboratory-created gemstones''
or ``imitation gemstones'' are not natural gemstones. Thus, the word
``gemstone'' is not deceptive when applied to synthetic or imitation
stones, if its use is properly qualified by a word or phrase that
discloses that the stone is not natural. The Commission therefore has
added the word ``gemstone'' to Sec. 23.19(b) of the current Guides,
which states that the name of a precious or semi-precious gemstone as
descriptive of a synthetic or imitation stone should be adequately
qualified to disclose that it is not a natural stone. However, for the
reasons described above, the Commission has not adopted the definition
of ``gemstone'' suggested by the JVC nor changed the definition of
``gem'' in Sec. 23.21 of the current Guides.
As noted, the JVC also proposed adding a Note recommending that the
word ``gem'' or ``similar term'' not be used as a quality designation
or as descriptive of gemstones because no criteria for these terms
exist and ``their use to describe, imply or represent quality could be
misleading.'' However, the JVC cited no evidence that such terms have
actually been misleading to consumers. Moreover, as Onyx noted, ``there
are `Gem' quality Gemstones as well as `trash' quality in the same
Gemstone.'' 351 Truthful, and indeed informative, use of the word
``gem'' is possible and thus, the Commission has not adopted this
proposal.
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\351\ Comment 162, p.3; NACSM (219) stated, at p.12, that this
would ``limit the use of the English language;'' AGTA (49) stated,
at p.16, that the Note should be stricken or, if retained, ``like
language should be added to the diamond section.''
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The JVC also proposed adding a section to the Guides stating that
``gemstone'' may not be used to describe any object ``not fashioned for
use as jewelry or personal adornment, e.g., statues, ashtrays, boxes,
etc.'' unless qualified by a term such as ``carving'' or ``engraving''
[Petition 23.20(b)]. No explanation was offered as to how such a use
could deceive consumers.352
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\352\ Onyx (162) p.3 (stating that the proposed prohibition
``flies in the face of fact''); NACSM (219) p.13 (opposing the
provision and describing it as a restrictive limitation for which no
justification has been given); Service (222) p.5 (stating that there
is no reason to prohibit a phrase such as ``gemstone jewelry box'').
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The Commission has not included this section in the Guides because
items other than jewelry are sometimes made of gemstones and it would
not be deceptive to so describe them.
The JVC proposed that a section be added to the Guides stating that
it is unfair to use the term ``semi-precious'' when referring to
gemstones or any synthetic, imitation, or simulated stone. [Petition
23.23(b)] The FRN solicited comment on this proposal.
No explanation was offered as to why the term ``semi-precious'' was
unfair or deceptive when applied to natural gemstones. Some commenters
who favored the proposal stated that it is a ``misnomer'' or that it
``gives a false impression of a gem having little intrinsic value; an
impression which may not be correct.'' 353 However, sellers are
not required to describe their wares as semi-precious; the import of
the JVC's proposal would be to prohibit those who wish to so describe
their wares from doing so. AGTA commented that, while it believes
``semi-precious'' is denigrating to ``natural gemstones other than
Ruby, Emerald, Sapphire and Diamond which are traditionally referred to
in the trade as the `precious gemstones,''' it did not believe it
should be illegal to so describe natural stones.354 Skalet
explained that the term ``semi-precious'' has been used in the jewelry
and gemstone industry for generations ``as a reference to natural
gemstones of moderate value and wide availability.'' 355 Based on
the comments, the Commission has concluded that there is no basis for
advising against the use of this term to describe natural gemstones.
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\353\ Thorpe (7) p.2; Capital (19) p.2.
\354\ Comment 49, p.10
\355\ Comment 61, p.5.
---------------------------------------------------------------------------
Finally, the JVC also proposed redrafting all sections pertaining
to precious and semi-precious stones, removing the terms ``precious''
and ``semi-precious'' and substituting ``gemstone.'' However, there is
no valid purpose for this change, and the Commission has determined
that substituting the term ``gemstone'' for ``precious and semi-
precious stones'' would make the Guides less clear.
[[Page 27212]]
5. Misuse of the Words ``Flawless,'' ``Perfect,'' Etc.
The JVC proposed the addition of a new section [petition 23.21]
that prohibits the use of the word ``perfect'' when applied to
gemstones and limits ``flawless'' to gemstones that do not have
blemishes. The JVC's definition of ``flawless'' is similar to the
provision in Sec. 23.10 of the current Guides, which applies only to
diamonds.356 A claim that a colored stone is flawless when it is
not is deceptive. The Commission has determined that the addition of
this section clarifies the meaning of ``flawless.'' 357
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\356\ The JVC proposed that the Guides state that it is unfair
``to use the word ``flawless'' as a quality description of any
gemstone which discloses blemishes, inclusions, or clarity faults of
any sort when examined under a corrected magnifier at 10-power, with
adequate illumination, by a person skilled in gemstone grading.''
However, no reference was made, in the petition or the comments, to
removal of blemishes by internal lasering of gemstones.
\357\ There was little comment about this provision. Diamonique
(224) stated, at p.4, that the change ``regarding the examination of
gemstones under 10-power magnification is radical and would have
far-reaching consequences. This proposed change replaces practices
and guidelines currently in use worldwide, requiring examination of
gemstones with the unaided eye.'' However, no other commenter stated
that the proposal was a change from existing practices. Lannyte (65)
suggested, at p.10, modifying the section to state that it is unfair
``to use the words ``flawless'' or ``perfect'' or any other
description which would lead a buyer to presume that such gemstone
is totally without blemishes, inclusion or other faults when viewed
by a skilled person under ten times magnification in adequate
light.''
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Part (b) of the section proposed by the JVC prohibits the use of
``perfect'' as a quality description ``of any gemstone other than a
diamond.'' No reasons were offered as to why the use of ``perfect'' as
applied to colored stones would always be deceptive, and numerous
comments objected to this provision.358 On the basis of the
comments, the Commission has not included this provision. However, the
Commission has determined that the industry may need guidance as to the
use of ``perfect'' with respect to gemstones,359 and has included
a provision (like the provision for diamonds) that ``perfect'' should
be used only for a gemstone that is flawless and not of inferior color
or cut.
---------------------------------------------------------------------------
\358\ Lannyte (65) p.11; ICT (189) p.2. AGTA (49) stated, at
pp.15, 16, that it ``prefers that the term `perfect' be deleted from
use in the trade for both diamonds and colored gems,'' but if the
use of the term ``perfect'' is acceptable for diamonds, it should
also be acceptable for colored gemstones. Otherwise, there ``would
be a passive inference that colored gemstones are less desirable
than diamonds. There are certainly as many `perfect,' i.e. flawless
(under 10X magnification), top color, well-cut gemstones as there
are diamonds.''
\359\ Diamonique (224) p.3 (stating that ``the Guides should
contain more specific guidelines in this area, including a
definition of the term `perfect,' instead of simply limiting its
use'').
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The JVC proposed that the Guides state it is unfair to use
``flawless'' or ``perfect'' to describe synthetics or imitations. No
reasons were offered as to why the use of ``flawless'' or ``perfect''
as applied to synthetic stones would always be deceptive. Thus, the
Commission has concluded that there is not enough evidence to include
this provision as to synthetic stones. However, because the terms imply
that a stone is a finer quality and, accordingly, a greater value, when
used to describe imitation stones, which are almost always flawless,
they could be misleading.360 Thus, the terms ``flawless'' and
``perfect'' should not be used to describe imitation stones.
---------------------------------------------------------------------------
\360\ NACSM (219) p.27 (stating that the proposal ``fails to
take into account a clearly recognized difference in the marketplace
between a `synthetic' . . . and an `imitation' stone''); Diamonique
(224) p.3 (stating that ``cultured, synthetic and simulated
gemstones would be described according to the same standards used
for natural gemstones. To do otherwise would create confusion within
the industry itself as well as among consumers'').
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6. Misuse of the Words ``Reproduction,'' or ``Replica'': Sec. 23.21(c)
Section 23.21(c) of the current Guides states that it is unfair to
use the words ``reproduction,'' ``replica,'' or similar terms to
describe cultured or imitation pearls or any imitation of precious or
semi-precious stones. The JVC proposed changing this section so that it
only prohibits the use of ``reproduction'' or ``replica'' when applied
to synthetic or imitation stones [petition 23.24(b)]. If the nature of
the material used in a reproduction or replica is adequately disclosed,
as is advised by other sections of the Guides, it is not clear that the
use of these terms would be deceptive or unfair.361 Accordingly,
the Commission has deleted this entire section from the Guides.
---------------------------------------------------------------------------
\361\ NACSM (219) p.27 (stating that the attempt to ``ban'' the
word ``reproduction'' is dubious); ISA (237A) p.15 (stating that
this would prohibit the use of ``reproduction'' and ``replica'' to
describe ``items which are in fact reproductions and replicas. We
recommend more emphasis on section 23.1(a), the general paragraph
which makes clear that the intent of the Guides is to prohibit
deception and deceptive use of such terms'').
---------------------------------------------------------------------------
List of Subjects in 16 CFR Parts 19 and 23
Advertising, Labeling, Trade practices, Watch bands and jewelry.
Accordingly, Part 23 is revised to read as follows:
PART 23--GUIDES FOR THE JEWELRY, PRECIOUS METALS, AND PEWTER
INDUSTRIES
Sec.
23.0 Scope and application.
23.1 Deception (general).
23.2 Misleading illustrations.
23.3 Misuse of the terms ``hand-made,'' ``hand-polished,'' etc.
23.4 Misrepresentation as to gold content.
23.5 Misuse of the word ``Vermeil.''
23.6 Misrepresentation as to silver content.
23.7 Misuse of words ``platinum,'' ``iridium,'' ``palladium,''
``ruthenium,'' ``rhodium,'' and ``osmium.''
23.8 Misrepresentation as to content of pewter.
23.9 Additional guidance for the use of quality marks.
23.10 Misuse of ``corrosion proof,'' ``noncorrosive,'' ``corrosion
resistant,'' ``rust proof,'' ``rust resistant,'' etc.
23.11 Definition and Misuse of the word ``diamond.''
23.12 Misuse of the words ``flawless,'' ``perfect,'' etc.
23.13 Disclosing existence of artificial coloring, infusing, etc.
23.14 Misuse of the term ``blue white.''
23.15 Misuse of the term ``properly cut,'' etc.
23.16 Misuse of the words ``brilliant'' and ``full cut.''
23.17 Misrepresentation of weight and ``total weight.''
23.18 Definitions of various pearls.
23.19 Misuse of the word ``pearl.''
23.20 Misuse of terms such as ``cultured pearl,'' ``seed pearl,''
``Oriental pearl,'' ``natura,'' ``kultured,'' ``real,'' ``gem,''
``synthetic,'' and regional designations.
23.21 Misrepresentation as to cultured pearls.
23.22 Deception as to gemstones.
23.23 Misuse of the words ``ruby,'' ``sapphire,'' ``emerald,''
``topaz,'' ``stone,'' ``birthstone,'' ``gemstone,'' etc.
23.24 Misuse of the words ``real,'' ``genuine,'' ``natural,''
``precious,'' etc.
23.25 Misuse of the word ``gem.''
23.26 Misuse of the words ``flawless,'' ``perfect,'' etc.
Appendix to Part 23--Exemptions recognized in the assay for quality
of gold alloy, gold filled, gold overlay, rolled gold plate, silver,
and platinum industry products.
Authority: Sec. 6, 5, 38 Stat. 721, 719; 15 U.S.C. 46, 45.
Sec. 23.0 Scope and application.
(a) These guides apply to jewelry industry products, which include,
but are not limited to, the following: gemstones and their laboratory-
created and imitation substitutes; natural and cultured pearls and
their imitations; and metallic watch bands not permanently attached to
watches.1 These guides also apply to articles, including optical
frames, pens and pencils, flatware, and
[[Page 27213]]
hollowware, fabricated from precious metals (gold, silver and platinum
group metals), precious metal alloys, and their imitations. These
guides also apply to all articles made from pewter. For the purposes of
these guides, all articles covered by these guides are defined as
``industry products.''
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\1\ The Guides for the Watch Industry, 16 C.F.R. Part 245,
address watchcases and permanently attached watchbands.
---------------------------------------------------------------------------
(b) These guides apply to persons, partnerships, or corporations,
at every level of the trade (including but not limited to
manufacturers, suppliers, and retailers) engaged in the business of
offering for sale, selling, or distributing industry products.
Note to paragraph (b): To prevent consumer deception, persons,
partnerships, or corporations in the business of appraising,
identifying, or grading industry products should utilize the
terminology and standards set forth in the guides.
(c) These guides apply to claims and representations about industry
products included in labeling, advertising, promotional materials, and
all other forms of marketing, whether asserted directly or by
implication, through words, symbols, emblems, logos, illustrations,
depictions, product brand names, or through any other means.
Sec. 23.1 Deception (general).
It is unfair or deceptive to misrepresent the type, kind, grade,
quality, quantity, metallic content, size, weight, cut, color,
character, treatment, substance, durability, serviceability, origin,
price, value, preparation, production, manufacture, distribution, or
any other material aspect of an industry product.
Note 1 to Sec. 23.1: If, in the sale or offering for sale of an
industry product, any representation is made as to the grade
assigned the product, the identity of the grading system used should
be disclosed.
Note 2 to Sec. 23.1: To prevent deception, any qualifications or
disclosures, such as those described in the guides, should be
sufficiently clear and prominent. Clarity of language, relative type
size and proximity to the claim being qualified, and an absence of
contrary claims that could undercut effectiveness, will maximize the
likelihood that the qualifications and disclosures are appropriately
clear and prominent.
Sec. 23.2 Misleading illustrations.
It is unfair or deceptive to use, as part of any advertisement,
packaging material, label, or other sales promotion matter, any visual
representation, picture, televised or computer image, illustration,
diagram, or other depiction which, either alone or in conjunction with
any accompanying words or phrases, misrepresents the type, kind, grade,
quality, quantity, metallic content, size, weight, cut, color,
character, treatment, substance, durability, serviceability, origin,
preparation, production, manufacture, distribution, or any other
material aspect of an industry product.
Note to Sec. 23.2: An illustration or depiction of a diamond or
other gemstone that portrays it in greater than its actual size may
mislead consumers, unless a disclosure is made about the item's true
size.
Sec. 23.3 Misuse of the terms ``hand-made,'' ``hand-polished,'' etc.
(a) It is unfair or deceptive to represent, directly or by
implication, that any industry product is hand-made or hand-wrought
unless the entire shaping and forming of such product from raw
materials and its finishing and decoration were accomplished by hand
labor and manually-controlled methods which permit the maker to control
and vary the construction, shape, design, and finish of each part of
each individual product.
Note to paragraph (a): As used herein, ``raw materials'' include
bulk sheet, strip, wire, and similar items that have not been cut,
shaped, or formed into jewelry parts, semi-finished parts, or
blanks.
(b) It is unfair or deceptive to represent, directly or by
implication, that any industry product is hand-forged, hand-engraved,
hand-finished, or hand-polished, or has been otherwise hand-processed,
unless the operation described was accomplished by hand labor and
manually-controlled methods which permit the maker to control and vary
the type, amount, and effect of such operation on each part of each
individual product.
Sec. 23.4 Misrepresentation as to gold content.
(a) It is unfair or deceptive to misrepresent the presence of gold
or gold alloy in an industry product, or the quantity or karat fineness
of gold or gold alloy contained in the product, or the karat fineness,
thickness, weight ratio, or manner of application of any gold or gold
alloy plating, covering, or coating on any surface of an industry
product or part thereof.
(b) The following are examples of markings or descriptions that may
be misleading: 2
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\2\ See Sec. 23.4(c) for examples of acceptable markings and
descriptions.
---------------------------------------------------------------------------
(1) Use of the word ``Gold'' or any abbreviation, without
qualification, to describe all or part of an industry product, which is
not composed throughout of fine (24 karat) gold.
(2) Use of the word ``Gold'' or any abbreviation to describe all or
part of an industry product composed throughout of an alloy of gold,
unless a correct designation of the karat fineness of the alloy
immediately precedes the word ``Gold'' or its abbreviation, and such
fineness designation is of at least equal conspicuousness.
(3) Use of the word ``Gold'' or any abbreviation to describe all or
part of an industry product that is not composed throughout of gold or
a gold alloy, but is surface-plated or coated with gold alloy, unless
the word ``Gold'' or its abbreviation is adequately qualified to
indicate that the product or part is only surface-plated.
(4) Use of the term ``Gold Plate,'' ``Gold Plated,'' or any
abbreviation to describe all or part of an industry product unless such
product or part contains a surface-plating of gold alloy, applied by
any process, which is of such thickness and extent of surface coverage
that reasonable durability is assured.
(5) Use of the terms ``Gold Filled,'' ``Rolled Gold Plate,''
``Rolled Gold Plated,'' ``Gold Overlay,'' or any abbreviation to
describe all or part of an industry product unless such product or part
contains a surface-plating of gold alloy applied by a mechanical
process and of such thickness and extent of surface coverage that
reasonable durability is assured, and unless the term is immediately
preceded by a correct designation of the karat fineness of the alloy
that is of at least equal conspicuousness as the term used.
(6) Use of the terms ``Gold Plate,'' ``Gold Plated,'' ``Gold
Filled,'' ``Rolled Gold Plate,'' ``Rolled Gold Plated,'' ``Gold
Overlay,'' or any abbreviation to describe a product in which the layer
of gold plating has been covered with a base metal (such as nickel),
which is covered with a thin wash of gold, unless there is a disclosure
that the primary gold coating is covered with a base metal, which is
gold washed.
(7) Use of the term ``Gold Electroplate,'' ``Gold Electroplated,''
or any abbreviation to describe all or part of an industry product
unless such product or part is electroplated with gold or a gold alloy
and such electroplating is of such karat fineness, thickness, and
extent of surface coverage that reasonable durability is assured.
(8) Use of any name, terminology, or other term to misrepresent
that an industry product is equal or superior to, or different than, a
known and established type of industry product with reference to its
gold content or method of manufacture.
(9) Use of the word ``Gold'' or any abbreviation, or of a quality
mark implying gold content (e.g., 9 karat), to describe all or part of
an industry product that is composed throughout of
[[Page 27214]]
an alloy of gold of less than 10 karat fineness.
Note to paragraph (b) Sec. 23.4: The provisions regarding the
use of the word ``Gold,'' or any abbreviation, as described above,
are applicable to ``Duragold,'' ``Diragold,'' ``Noblegold,''
``Goldine,'' ``Layered Gold,'' or any words or terms of similar
meaning.
(c) The following are examples of markings and descriptions that
are consistent with the principles described above:
(1) An industry product or part thereof, composed throughout of an
alloy of gold of not less than 10 karat fineness, may be marked and
described as ``Gold'' when such word ``Gold,'' wherever appearing, is
immediately preceded by a correct designation of the karat fineness of
the alloy, and such karat designation is of equal conspicuousness as
the word ``Gold'' (for example, ``14 Karat Gold,'' ``14 K. Gold,'' or
``14 Kt. Gold''). Such product may also be marked and described by a
designation of the karat fineness of the gold alloy unaccompanied by
the word ``Gold'' (for example, ``14 Karat,'' ``14 Kt.,'' or ``14
K.'').
Note to paragraph (c)(1): Use of the term ``Gold'' or any
abbreviation to describe all or part of a product that is composed
throughout of gold alloy, but contains a hollow center or interior,
may mislead consumers, unless the fact that the product contains a
hollow center is disclosed in immediate proximity to the term
``Gold'' or its abbreviation (for example, ``14 Karat Gold-Hollow
Center,'' or ``14 K. Gold Tubing,'' when of a gold alloy tubing of
such karat fineness). Such products should not be marked or
described as ``solid'' or as being solidly of gold or of a gold
alloy. For example, when the composition of such a product is 14
karat gold alloy, it should not be described or marked as either
``14 Kt. Solid Gold'' or as ``Solid 14 Kt. Gold.''
(2) An industry product or part thereof, on which there has been
affixed on all significant surfaces, by any process, a coating,
electroplating, or deposition by any means, of gold or gold alloy of
not less than 10 karat fineness that is of substantial thickness,3
and the minimum thickness throughout of which is equivalent to one-half
micron (or approximately 20 millionths of an inch) of fine gold,4
may be marked or described as ``Gold Plate'' or ``Gold Plated,'' or
abbreviated, as, for example, G.P. The exact thickness of the plate may
be marked on the item, if it is immediately followed by a designation
of the karat fineness of the plating which is of equal conspicuousness
as the term used (as, for example, ``2 microns 12 K. gold plate'' or
``2 12 K. G.P.'' for an item plated with 2 microns of 12 karat
gold.)
\3\ The term ``substantial thickness'' means that all areas of
the plating are of such thickness as to assure a durable coverage of
the base metal to which it has been affixed. Since industry products
include items having surfaces and parts of surfaces that are subject
to different degrees of wear, the thickness of plating for all items
or for different areas of the surface of individual items does not
necessarily have to be uniform.
\4\ A product containing 1 micron (otherwise known as
1) of 12 karat gold is equivalent to one-half micron of 24
karat gold.
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Note paragraph (c)(2) to paragraph (b): If an industry product
has a thicker coating or electroplating of gold or gold alloy on
some areas than others, the minimum thickness of the plate should be
marked.
(3) An industry product or part thereof on which there has been
affixed on all significant surfaces by soldering, brazing, welding, or
other mechanical means, a plating of gold alloy of not less than 10
karat fineness and of substantial thickness 5 may be marked or
described as ``Gold Filled,'' ``Gold Overlay,'' ``Rolled Gold Plate,''
or an adequate abbreviation, when such plating constitutes at least \1/
20\th of the weight of the metal in the entire article and when the
term is immediately preceded by a designation of the karat fineness of
the plating which is of equal conspicuousness as the term used (for
example, ``14 Karat Gold Filled,'' ``14 Kt. Gold Filled,'' ``14 Kt.
G.F.,'' ``14 Kt. Gold Overlay,'' or ``14K. R.G.P.''). When conforming
to all such requirements except the specified minimum of \1/20\th of
the weight of the metal in the entire article, the terms ``Gold
Overlay'' and ``Rolled Gold Plate'' may be used when the karat fineness
designation is immediately preceded by a fraction accurately disclosing
the portion of the weight of the metal in the entire article accounted
for by the plating, and when such fraction is of equal conspicuousness
as the term used (for example, ``\1/40\th 12 Kt. Rolled Gold Plate'' or
``\1/40\ 12 Kt. R.G.P.'').
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\5\ See footnote 3.
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(4) An industry product or part thereof, on which there has been
affixed on all significant surfaces by an electrolytic process, an
electroplating of gold, or of a gold alloy of not less than 10 karat
fineness, which has a minimum thickness throughout equivalent to .175
microns (approximately 7/1,000,000ths of an inch) of fine
gold, may be marked or described as ``Gold Electroplate'' or ``Gold
Electroplated,'' or abbreviated, as, for example, ``G.E.P.'' When the
electroplating meets the minimum fineness but not the minimum thickness
specified above, the marking or description may be ``Gold Flashed'' or
``Gold Washed.'' When the electroplating is of the minimum fineness
specified above and of a minimum thickness throughout equivalent to two
and one half (2\1/2\) microns (or approximately 100/
1,000,000ths of an inch) of fine gold, the marking or description
may be ``Heavy Gold Electroplate'' or ``Heavy Gold Electroplated.''
When electroplatings qualify for the term ``Gold Electroplate'' (or
``Gold Electroplated''), or the term ``Heavy Gold Electroplate'' (or
``Heavy Gold Electroplated''), and have been applied by use of a
particular kind of electrolytic process, the marking may be accompanied
by identification of the process used, as for example, ``Gold
Electroplated (X Process)'' or ``Heavy Gold Electroplated (Y
Process).''
(d) The provisions of this section relating to markings and
descriptions of industry products and parts thereof are subject to the
applicable tolerances of the National Stamping Act or any amendment
thereof.6
\6\ Under the National Stamping Act, articles or parts made of
gold or of gold alloy that contain no solder have a permissible
tolerance of three parts per thousand. If the part tested contains
solder, the permissible tolerance is seven parts per thousand. For
full text, see 15 U.S.C. 295, et seq.
---------------------------------------------------------------------------
Note 4 to paragraph (d) : Exemptions recognized in the assay of
karat gold industry products and in the assay of gold filled, gold
overlay, and rolled gold plate industry products, and not to be
considered in any assay for quality, are listed in the Appendix.
Sec. 23.5 Misuse of the word ``Vermeil.''
(a) It is unfair or deceptive to represent, directly or by
implication, that an industry product is ``vermeil'' if such mark or
description misrepresents the product's true composition.
(b) An industry product may be described or marked as ``vermeil''
if it consists of a base of sterling silver coated or plated on all
significant surfaces with gold, or gold alloy of not less than 10 karat
fineness, that is of substantial thickness 7 and a minimum
thickness throughout equivalent to two and one half (2\1/2\) microns
(or approximately 100/1,000,000ths of an inch) of fine gold.
\7\ See footnote 3.
---------------------------------------------------------------------------
Note 1 to Sec. 23.5: It is unfair or deceptive to use the term
``vermeil'' to describe a product in which the sterling silver has
been covered with a base metal (such as nickel) plated with gold
unless there is a disclosure that the sterling silver is covered
with a base metal that is plated with gold.
Note 2 to Sec. 23.5: Exemptions recognized in the assay of gold
filled, gold overlay, and rolled gold plate industry products are
listed in the Appendix.
Sec. 23.6 Misrepresentation as to silver content.
(a) It is unfair or deceptive to misrepresent that an industry
product
[[Page 27215]]
contains silver, or to misrepresent an industry product as having a
silver content, plating, electroplating, or coating.
(b) It is unfair or deceptive to mark, describe, or otherwise
represent all or part of an industry product as ``silver,'' ``solid
silver,'' ``Sterling Silver,'' ``Sterling,'' or the abbreviation
``Ster.'' unless it is at least 925/1,000ths pure silver.
(c) It is unfair or deceptive to mark, describe, or otherwise
represent all or part of an industry product as ``coin'' or ``coin
silver'' unless it is at least 900/1,000ths pure silver.
(d) It is unfair or deceptive to mark, describe, or otherwise
represent all or part of an industry product as being plated or coated
with silver unless all significant surfaces of the product or part
contain a plating or coating of silver that is of substantial
thickness.8
---------------------------------------------------------------------------
\8\ See footnote 3.
---------------------------------------------------------------------------
(e) The provisions of this section relating to markings and
descriptions of industry products and parts thereof are subject to the
applicable tolerances of the National Stamping Act or any amendment
thereof.9
\9\ Under the National Stamping Act, sterling silver articles or
parts that contain no solder have a permissible tolerance of four
parts per thousand. If the part tested contains solder, the
permissible tolerance is ten parts per thousand. For full text, see
15 U.S.C. 294, et seq.
---------------------------------------------------------------------------
Note 1 to Sec. 23.6: The National Stamping Act provides that
silverplated articles shall not ``be stamped, branded, engraved or
imprinted with the word `sterling' or the word `coin,' either alone
or in conjunction with other words or marks.'' 15 U.S.C. 297(a).
Note 2 to Sec. 23.6: Exemptions recognized in the assay of
silver industry products are listed in the Appendix.
Sec. 23.7 Misuse of words ``platinum,'' ``iridium,'' ``palladium,''
``ruthenium,'' ``rhodium,'' and ``osmium.''
It is an unfair trade practice to use the words ``platinum,''
``iridium,'' ``palladium,'' ``ruthenium,'' ``rhodium,'' or ``osmium,''
or any abbreviations thereof, as a marking on, or as descriptive of,
any industry product or part thereof, under any circumstance or
condition having the capacity and tendency or effect of deceiving
purchasers or prospective purchasers as to the true composition of such
product or part.
Note 1 to Sec. 23.7: Commercial Standard CS66-38, issued by the
National Bureau of Standards of the U.S. Department of Commerce,
covers the marking of articles made wholly or in part of platinum.
Markings on industry products which are in compliance with the
requirements of CS66-38 will be regarded as among those fulfilling
the requirements relating thereto which are contained in this
section.
Note 2 to Sec. 23.7: See also Sec. 23.9 entitled ``Additional
guidance for the use of quality marks.''
Sec. 23.8 Misrepresentation as to content of pewter.
(a) It is unfair or deceptive to mark, describe, or otherwise
represent all or part of an industry product as ``Pewter'' or any
abbreviation if such mark or description misrepresents the product's
true composition.
(b) An industry product or part thereof may be described or marked
as ``Pewter'' or any abbreviation if it consists of at least 900 parts
per 1000 Grade A Tin, with the remainder composed of metals appropriate
for use in pewter.
Sec. 23.9 Additional guidance for the use of quality marks.
As used in these guides, the term ``quality mark'' means any
letter, figure, numeral, symbol, sign, word, or term, or any
combination thereof, that has been stamped, embossed, inscribed, or
otherwise placed on any industry product and which indicates or
suggests that any such product is composed throughout of any precious
metal or any precious metal alloy or has a surface or surfaces on which
there has been plated or deposited any precious metal or precious metal
alloy. Included are the words ``gold,'' ``karat,'' ``carat,''
``silver,'' ``sterling,'' ``vermeil,'' ``platinum,'' ``iridium,''
``palladium,'' ``ruthenium,'' ``rhodium,'' or ``osmium,'' or any
abbreviations thereof, whether used alone or in conjunction with the
words ``filled,'' ``plated,'' ``overlay,'' or ``electroplated,'' or any
abbreviations thereof. Quality markings include those in which the
words or terms ``gold,'' ``karat,'' ``silver,'' ``vermeil,''
``platinum'' (or platinum group metals), or their abbreviations are
included, either separately or as suffixes, prefixes, or syllables.
(a) Deception as to applicability of marks. (1) If a quality mark
on an industry product is applicable to only part of the product, the
part of the product to which it is applicable (or inapplicable) should
be disclosed when, absent such disclosure, the location of the mark
misrepresents the product or part's true composition.
(2) If a quality mark is applicable to only part of an industry
product, but not another part which is of similar surface appearance,
each quality mark should be closely accompanied by an identification of
the part or parts to which the mark is applicable.
(b) Deception by reason of difference in the size of letters or
words in a marking or markings. It is unfair or deceptive to place a
quality mark on a product in which the words or letters appear in
greater size than other words or letters of the mark, or when different
markings placed on the product have different applications and are in
different sizes, when the net impression of any such marking would be
misleading as to the metallic composition of all or part of the
product. (An example of improper marking would be the marking of a gold
electroplated product with the word ``electroplate'' in small type and
the word ``gold'' in larger type, with the result that purchasers and
prospective purchasers of the product might only observe the word
``gold.'')
Note 1 to Sec. 23.9: Legibility of markings. If a quality mark
is engraved or stamped on an industry product, or is printed on a
tag or label attached to the product, the quality mark should be of
sufficient size type as to be legible to persons of normal vision,
should be so placed as likely to be observed by purchasers, and
should be so attached as to remain thereon until consumer purchase.
Note 2 to Sec. 23.9: Disclosure of identity of manufacturers,
processors, or distributors. The National Stamping Act provides that
any person, firm, corporation, or association, being a manufacturer
or dealer subject to section 294 of the Act, who applies or causes
to be applied a quality mark, or imports any article bearing a
quality mark ``which indicates or purports to indicate that such
article is made in whole or in part of gold or silver or of an alloy
of either metal'' shall apply to the article the trademark or name
of such person. 15 U.S.C. 297.
Sec. 23.10 Misuse of ``corrosion proof,'' ``noncorrosive,''
``corrosion resistant,'' ``rust proof,'' ``rust resistant,'' etc.
(a) It is unfair or deceptive to:
(1) Use the terms ``corrosion proof,'' ``noncorrosive,'' ``rust
proof,'' or any other term of similar meaning to describe an industry
product unless all parts of the product will be immune from rust and
other forms of corrosion during the life expectancy of the product; or
(2) Use the terms ``corrosion resistant,'' ``rust resistant,'' or
any other term of similar meaning to describe an industry product
unless all parts of the product are of such composition as to not be
subject to material damage by corrosion or rust during the major
portion of the life expectancy of the product under normal conditions
of use.
(b) Among the metals that may be considered as corrosion (and rust)
resistant are: Pure nickel; Gold alloys of not less than 10 Kt.
fineness; and Austenitic stainless steels.
Sec. 23.11 Definition and misuse of the word ``diamond.''
(a) A diamond is a natural mineral consisting essentially of pure
carbon
[[Page 27216]]
crystallized in the isometric system. It is found in many colors. Its
hardness is 10; its specific gravity is approximately 3.52; and it has
a refractive index of 2.42.
(b) It is unfair or deceptive to use the unqualified word
``diamond'' to describe or identify any object or product not meeting
the requirements specified in the definition of diamond provided above,
or which, though meeting such requirements, has not been symmetrically
fashioned with at least seventeen (17) polished facets.
Note 1 to paragraph (b): It is unfair or deceptive to represent,
directly or by implication, that industrial grade diamonds or other
non-jewelry quality diamonds are of jewelry quality.
(c) The following are examples of descriptions that are not
considered unfair or deceptive:
(1) The use of the words ``rough diamond'' to describe or designate
uncut or unfaceted objects or products satisfying the definition of
diamond provided above; or
(2) The use of the word ``diamond'' to describe or designate
objects or products satisfying the definition of diamond but which have
not been symmetrically fashioned with at least seventeen (17) polished
facets when in immediate conjunction with the word ``diamond'' there is
either a disclosure of the number of facets and shape of the diamond or
the name of a type of diamond that denotes shape and that usually has
less than seventeen (17) facets (e.g., ``rose diamond'').
Note 2 to paragraph (c): Additional guidance about imitation and
laboratory-created diamond representations and misuse of words
``gem,'' ``real,'' ``genuine,'' ``natural,'' etc., are set forth in
Secs. 23.23, 23.24, and 23.25.
Sec. 23.12 Misuse of the words ``flawless,'' ``perfect,'' etc.
(a) It is unfair or deceptive to use the word ``flawless'' to
describe any diamond that discloses flaws, cracks, inclusions, carbon
spots, clouds, internal lasering, or other blemishes or imperfections
of any sort when examined under a corrected magnifier at 10-power, with
adequate illumination, by a person skilled in diamond grading.
(b) It is unfair or deceptive to use the word ``perfect,'' or any
representation of similar meaning, to describe any diamond unless the
diamond meets the definition of ``flawless'' and is not of inferior
color or make.
(c) It is unfair or deceptive to use the words ``flawless'' or
``perfect'' to describe a ring or other article of jewelry having a
``flawless'' or ``perfect'' principal diamond or diamonds, and
supplementary stones that are not of such quality, unless there is a
disclosure that the description applies only to the principal diamond
or diamonds.
Sec. 23.13 Disclosing existence of artificial coloring, infusing, etc.
If a diamond has been treated by artificial coloring, tinting,
coating, irradiating, heating, by the use of nuclear bombardment, or by
the introduction or the infusion of any foreign substance, it is unfair
or deceptive not to disclose that the diamond has been treated and that
the treatment is not or may not be permanent.
Sec. 23.14 Misuse of the term ``blue white.''
It is unfair or deceptive to use the term ``blue white'' or any
representation of similar meaning to describe any diamond that under
normal, north daylight or its equivalent shows any color or any trace
of any color other than blue or bluish.
Sec. 23.15 Misuse of the term ``properly cut,'' etc.
It is unfair or deceptive to use the terms ``properly cut,''
``proper cut,'' ``modern cut,'' or any representation of similar
meaning to describe any diamond that is lopsided, or is so thick or so
thin in depth as to detract materially from the brilliance of the
stone.
Note to Sec. 23.15: Stones that are commonly called ``fisheye''
or ``old mine'' should not be described as ``properly cut,''
``modern cut,'' etc.
Sec. 23.16 Misuse of the words ``brilliant'' and ``full cut.''
It is unfair or deceptive to use the unqualified expressions
``brilliant,'' ``brilliant cut,'' or ``full cut'' to describe,
identify, or refer to any diamond except a round diamond that has at
least thirty-two (32) facets plus the table above the girdle and at
least twenty-four (24) facets below.
Note to Sec. 23.16: Such terms should not be applied to single
or rose-cut diamonds. They may be applied to emerald-(rectangular)
cut, pear-shaped, heart-shaped, oval-shaped, and marquise-(pointed
oval) cut diamonds meeting the above-stated facet requirements when,
in immediate conjunction with the term used, the form of the diamond
is disclosed.
Sec. 23.17 Misrepresentation of weight and ``total weight.''
(a) It is unfair or deceptive to misrepresent the weight of a
diamond.
(b) It is unfair or deceptive to use the word ``point'' or any
abbreviation in any representation, advertising, marking, or labeling
to describe the weight of a diamond, unless the weight is also stated
as decimal parts of a carat (e.g., 25 points or .25 carat).
Note 1 to paragraph (b): A carat is a standard unit of weight
for a diamond and is equivalent to 200 milligrams (\1/5\ gram). A
point is one one hundredth (\1/100\) of a carat.
(c) If diamond weight is stated as decimal parts of a carat (e.g.,
.47 carat), the stated figure should be accurate to the last decimal
place. If diamond weight is stated to only one decimal place (e.g., .5
carat), the stated figure should be accurate to the second decimal
place (e.g., ``.5 carat'' could represent a diamond weight between
.495-.504).
(d) If diamond weight is stated as fractional parts of a carat, a
conspicuous disclosure of the fact that the diamond weight is not exact
should be made in close proximity to the fractional representation and
a disclosure of a reasonable range of weight for each fraction (or the
weight tolerance being used) should also be made.
Note to paragraph (d): When fractional representations of
diamond weight are made, as described in paragraph d of this
section, in catalogs or other printed materials, the disclosure of
the fact that the actual diamond weight is within a specified range
should be made conspicuously on every page where a fractional
representation is made. Such disclosure may refer to a chart or
other detailed explanation of the actual ranges used. For example,
``Diamond weights are not exact; see chart on p.X for ranges.''
Sec. 23.18 Definitions of various pearls.
As used in these guides, the terms set forth below have the
following meanings:
(a) Pearl: A calcareous concretion consisting essentially of
alternating concentric layers of carbonate of lime and organic material
formed within the body of certain mollusks, the result of an abnormal
secretory process caused by an irritation of the mantle of the mollusk
following the intrusion of some foreign body inside the shell of the
mollusk, or due to some abnormal physiological condition in the
mollusk, neither of which has in any way been caused or induced by
humans.
(b) Cultured Pearl: The composite product created when a nucleus
(usually a sphere of calcareous mollusk shell) planted by humans inside
the shell or in the mantle of a mollusk is coated with nacre by the
mollusk.
(c) Imitation Pearl: A manufactured product composed of any
material or materials that simulate in appearance a pearl or cultured
pearl.
(d) Seed Pearl: A small pearl, as defined in (a), that measures
approximately two millimeters or less.
[[Page 27217]]
Sec. 23.19 Misuse of the word ``pearl.''
(a) It is unfair or deceptive to use the unqualified word ``pearl''
or any other word or phrase of like meaning to describe, identify, or
refer to any object or product that is not in fact a pearl, as defined
in Sec. 23.18(a).
(b) It is unfair or deceptive to use the word ``pearl'' to
describe, identify, or refer to a cultured pearl unless it is
immediately preceded, with equal conspicuousness, by the word
``cultured'' or ``cultivated,'' or by some other word or phrase of like
meaning, so as to indicate definitely and clearly that the product is
not a pearl.
(c) It is unfair or deceptive to use the word ``pearl'' to
describe, identify, or refer to an imitation pearl unless it is
immediately preceded, with equal conspicuousness, by the word
``artificial,'' ``imitation,'' or ``simulated,'' or by some other word
or phrase of like meaning, so as to indicate definitely and clearly
that the product is not a pearl.
(d) It is unfair or deceptive to use the terms ``faux pearl,''
``fashion pearl,'' ``Mother of Pearl,'' or any other such term to
describe or qualify an imitation pearl product unless it is immediately
preceded, with equal conspicuousness, by the word ``artificial,''
``imitation,'' or ``simulated,'' or by some other word or phrase of
like meaning, so as to indicate definitely and clearly that the product
is not a pearl.
Sec. 23.20 Misuse of terms such as ``cultured pearl,'' ``seed pearl,''
``Oriental pearl,'' ``natura,'' ``kultured,'' ``real,'' ``gem,''
``synthetic,'' and regional designations.
(a) It is unfair or deceptive to use the term ``cultured pearl,''
``cultivated pearl,'' or any other word, term, or phrase of like
meaning to describe, identify, or refer to any imitation pearl.
(b) It is unfair or deceptive to use the term ``seed pearl'' or any
word, term, or phrase of like meaning to describe, identify, or refer
to a cultured or an imitation pearl, without using the appropriate
qualifying term ``cultured'' (e.g., ``cultured seed pearl'') or
``simulated,'' ``artificial,'' or ``imitation'' (e.g., ``imitation seed
pearl'').
(c) It is unfair or deceptive to use the term ``Oriental pearl'' or
any word, term, or phrase of like meaning to describe, identify, or
refer to any industry product other than a pearl taken from a salt
water mollusk and of the distinctive appearance and type of pearls
obtained from mollusks inhabiting the Persian Gulf and recognized in
the jewelry trade as Oriental pearls.
(d) It is unfair or deceptive to use the word ``Oriental'' to
describe, identify, or refer to any cultured or imitation pearl.
(e) It is unfair or deceptive to use the word ``natura,''
``natural,'' ``nature's,'' or any word, term, or phrase of like meaning
to describe, identify, or refer to a cultured or imitation pearl. It is
unfair or deceptive to use the term ``organic'' to describe, identify,
or refer to an imitation pearl, unless the term is qualified in such a
way as to make clear that the product is not a natural or cultured
pearl.
(f) It is unfair or deceptive to use the term ``kultured,'' ``semi-
cultured pearl,'' ``cultured-like,'' ``part-cultured,'' ``pre-mature
cultured pearl,'' or any word, term, or phrase of like meaning to
describe, identify, or refer to an imitation pearl.
(g) It is unfair or deceptive to use the term ``South Sea pearl''
unless it describes, identifies, or refers to a pearl that is taken
from a salt water mollusk of the Pacific Ocean South Sea Islands,
Australia, or Southeast Asia. It is unfair or deceptive to use the term
``South Sea cultured pearl'' unless it describes, identifies, or refers
to a cultured pearl formed in a salt water mollusk of the Pacific Ocean
South Sea Islands, Australia, or Southeast Asia.
(h) It is unfair or deceptive to use the term ``Biwa cultured
pearl'' unless it describes, identifies, or refers to cultured pearls
grown in fresh water mollusks in the lakes and rivers of Japan.
(i) It is unfair or deceptive to use the word ``real,''
``genuine,'' ``precious,'' or any word, term, or phrase of like meaning
to describe, identify, or refer to any imitation pearl.
(j) It is unfair or deceptive to use the word ``gem'' to describe,
identify, or refer to a pearl or cultured pearl that does not possess
the beauty, symmetry, rarity, and value necessary for qualification as
a gem.
Note to paragraph (j): Use of the word ``gem'' with respect to
cultured pearls should be avoided since few cultured pearls possess
the necessary qualifications to properly be termed ``gems.''
Imitation pearls should not be described as ``gems.''
(k) It is unfair or deceptive to use the word ``synthetic'' or
similar terms to describe cultured or imitation pearls.
(l) It is unfair or deceptive to use the terms ``Japanese Pearls,''
``Chinese Pearls,'' ``Mallorca Pearls,'' or any regional designation to
describe, identify, or refer to any cultured or imitation pearl, unless
the term is immediately preceded, with equal conspicuousness, by the
word ``cultured,'' ``artificial,'' ``imitation,'' or ``simulated,'' or
by some other word or phrase of like meaning, so as to indicate
definitely and clearly that the product is a cultured or imitation
pearl.
Sec. 23.21 Misrepresentation as to cultured pearls.
It is unfair or deceptive to misrepresent the manner in which
cultured pearls are produced, the size of the nucleus artificially
inserted in the mollusk and included in cultured pearls, the length of
time that such products remained in the mollusk, the thickness of the
nacre coating, the value and quality of cultured pearls as compared
with the value and quality of pearls and imitation pearls, or any other
material matter relating to the formation, structure, properties,
characteristics, and qualities of cultured pearls.
Sec. 23.22 Deception as to gemstones.
It is unfair or deceptive to fail to disclose that a gemstone has
been treated in any manner that is not permanent or that creates
special care requirements, and to fail to disclose that the treatment
is not permanent, if such is the case. The following are examples of
treatments that should be disclosed because they usually are not
permanent or create special care requirements: coating, impregnation,
irradiating, heating, use of nuclear bombardment, application of
colored or colorless oil or epoxy-like resins, wax, plastic, or glass,
surface diffusion, or dyeing. This disclosure may be made at the point
of sale, except that disclosure should be made in any solicitation
where the product can be purchased without viewing (e.g., direct mail
catalogs, on-line services), and in the case of televised shopping
programs, on the air. If special care requirements for a gemstone arise
because the gemstone has been treated, it is recommended that the
seller disclose the special care requirements to the purchaser.
Sec. 23.23 Misuse of the words ``ruby,'' ``sapphire,'' ``emerald,''
``topaz,'' ``stone,'' ``birthstone,'' ``gemstone,'' etc.
(a) It is unfair or deceptive to use the unqualified words
``ruby,'' ``sapphire,'' ``emerald,'' ``topaz,'' or the name of any
other precious or semi-precious stone to describe any product that is
not in fact a natural stone of the type described.
(b) It is unfair or deceptive to use the word ``ruby,''
``sapphire,'' ``emerald,'' ``topaz,'' or the name of any other precious
or semi-precious stone, or the word ``stone,'' ``birthstone,''
``gemstone,'' or similar term to describe a laboratory-grown,
laboratory-created, [manufacturer name]-created, synthetic, imitation,
or simulated stone, unless such word or name is immediately preceded
with equal conspicuousness by the word ``laboratory-grown,''
``laboratory-created,'' ``[manufacturer
[[Page 27218]]
name]-created,'' ``synthetic,'' or by the word ``imitation'' or
``simulated,'' so as to disclose clearly the nature of the product and
the fact it is not a natural gemstone.
Note to paragraph (h): The use of the word ``faux'' to describe
a laboratory-created or imitation stone is not an adequate
disclosure that the stone is not natural.
(c) It is unfair or deceptive to use the word ``laboratory-grown,''
``laboratory-created,'' ``[manufacturer name]-created,'' or
``synthetic'' with the name of any natural stone to describe any
industry product unless such industry product has essentially the same
optical, physical, and chemical properties as the stone named.
Sec. 23.24 Misuse of the words ``real,'' ``genuine,'' ``natural,''
``precious,'' etc.
It is unfair or deceptive to use the word ``real,'' ``genuine,''
``natural,'' ``precious,'' ``semi-precious,'' or similar terms to
describe any industry product that is manufactured or produced
artificially.
Sec. 23.25 Misuse of the word ``gem.''
(a) It is unfair or deceptive to use the word ``gem'' to describe,
identify, or refer to a ruby, sapphire, emerald, topaz, or other
industry product that does not possess the beauty, symmetry, rarity,
and value necessary for qualification as a gem.
(b) It is unfair or deceptive to use the word ``gem'' to describe
any laboratory-created i
FR Doc. 96-13524 Guides for the Metallic Watch Band Industry and Guides for the Jewelry Industry
ndustry product unless the product meets the
requirements of paragraph (a) of this section and unless such word is
immediately accompanied, with equal conspicuousness, by the word
``laboratory-grown,'' ``laboratory-created,'' or ``[manufacturer-name]-
created,'' ``synthetic,'' or by some other word or phrase of like
meaning, so as to clearly disclose that it is not a natural gem.
Note to Sec. 23.25: In general, use of the word ``gem'' with
respect to laboratory-created stones should be avoided since few
laboratory-created stones possess the necessary qualifications to
properly be termed ``gems.'' Imitation diamonds and other imitation
stones should not be described as ``gems.'' Not all diamonds or
natural stones, including those classified as precious stones,
possess the necessary qualifications to be properly termed ``gems.''
Sec. 23.26 Misuse of the words ``flawless,'' ``perfect,'' etc.
(a) It is unfair or deceptive to use the word ``flawless'' as a
quality description of any gemstone that discloses blemishes,
inclusions, or clarity faults of any sort when examined under a
corrected magnifier at 10-power, with adequate illumination, by a
person skilled in gemstone grading.
(b) It is unfair or deceptive to use the word ``perfect'' or any
representation of similar meaning to describe any gemstone unless the
gemstone meets the definition of ``flawless'' and is not of inferior
color or make.
(c) It is unfair or deceptive to use the word ``flawless,''
``perfect,'' or any representation of similar meaning to describe any
imitation gemstone.
Appendix to Part 23--Exemptions Recognized in the Assay for Quality of
Gold Alloy, Gold Filled, Gold Overlay, Rolled Gold Plate, Silver, and
Platinum Industry Products
(a) Exemptions recognized in the industry and not to be
considered in any assay for quality of a karat gold industry product
include springs, posts, and separable backs of lapel buttons, posts
and nuts for attaching interchangeable ornaments, metallic parts
completely and permanently encased in a nonmetallic covering, field
pieces and bezels for lockets,1 and wire pegs or rivets used
for applying mountings and other ornaments, which mountings or
ornaments shall be of the quality marked.
---------------------------------------------------------------------------
\1\ Field pieces of lockets are those inner portions used as
frames between the inside edges of the locket and the spaces for
holding pictures. Bezels are the separable inner metal rings to hold
the pictures in place.
Note: Exemptions recognized in the industry and not to be
considered in any assay for quality of a karat gold optical product
include: the hinge assembly (barrel or other special types such as
are customarily used in plastic frames); washers, bushings, and nuts
of screw assemblies; dowels; springs for spring shoe straps; metal
parts permanently encased in a non-metallic covering; and for
oxfords,2 coil and joint springs.
---------------------------------------------------------------------------
\2\ Oxfords are a form of eyeglasses where a flat spring joins
the two eye rims and the tension it exerts on the nose serves to
hold the unit in place. Oxfords are also referred to as pince nez.
---------------------------------------------------------------------------
(b) Exemptions recognized in the industry and not to be
considered in any assay for quality of a gold filled, gold overlay
and rolled gold plate industry product, other than watchcases,
include joints, catches, screws, pin stems, pins of scarf pins, hat
pins, etc., field pieces and bezels for lockets, posts and separate
backs of lapel buttons, bracelet and necklace snap tongues, springs,
and metallic parts completely and permanently encased in a
nonmetallic covering.
Note: Exemptions recognized in the industry and not to be
considered in any assay for quality of a gold filled, gold overlay
and rolled gold plate optical product include: screws; the hinge
assembly (barrel or other special types such as are customarily used
in plastic frames); washers, bushings, tubes and nuts of screw
assemblies; dowels; pad inserts; springs for spring shoe straps,
cores and/or inner windings of comfort cable temples; metal parts
permanently encased in a non-metallic covering; and for oxfords, the
handle and catch.
(c) Exemptions recognized in the industry and not to be
considered in any assay for quality of a silver industry product
include screws, rivets, springs, spring pins for wrist watch straps;
posts and separable backs of lapel buttons; wire pegs, posts, and
nuts used for applying mountings or other ornaments, which mountings
or ornaments shall be of the quality marked; pin stems (e.g., of
badges, brooches, emblem pins, hat pins, and scarf pins, etc.);
levers for belt buckles; blades and skeletons of pocket knives;
field pieces and bezels for lockets; bracelet and necklace snap
tongues; any other joints, catches, or screws; and metallic parts
completely and permanently encased in a nonmetallic covering.
(d) Exemptions recognized in the industry and not to be
considered in any assay for quality of an industry product of silver
in combination with gold include joints, catches, screws, pin stems,
pins of scarf pins, hat pins, etc., posts and separable backs of
lapel buttons, springs, and metallic parts completely and
permanently encased in a nonmetallic covering.
(e) Exemptions recognized in the industry and not to be
considered in any assay for quality of a platinum industry product
include springs, winding bars, sleeves, crown cores, mechanical
joint pins, screws, rivets, dust bands, detachable movement rims,
hat-pin stems, and bracelet and necklace snap tongues. In addition,
the following exemptions are recognized for products marked in
accordance with section 23.8(b)(5) of these Guides (i.e., products
that are less than 500 parts per thousand platinum): pin tongues,
joints, catches, lapel button backs and the posts to which they are
attached, scarf-pin stems, hat pin sockets, shirt-stud backs, vest-
button backs, and ear-screw backs, provided such parts are made of
the same quality platinum as is used in the balance of the article.
By direction of the Commission.
Donald S. Clark,
Secretary.
Note: The following appendix will not appear in the Code of
Federal Regulations.
Appendix--List of Commenters and Abbreviations
------------------------------------------------------------------------
Abbreviation No. Commenter
------------------------------------------------------------------------
A&D Gem...................... 187 A & D Gem Corp.
[[Page 27219]]
A&Z.......................... 29 A & Z Pearls, Inc.
ADS.......................... 197 American Diamond
Syndicate.
Affro........................ 138 Affro Gems.
AGL.......................... 230 American Gemological
Laboratories.
AGS.......................... 18 American Gem Society.
AGTA......................... 49 The American Gem
Trade Association,
Inc.
Alarama...................... 51 Alarama Jewelry Co.,
Inc.
Alfille...................... 247 E.J. Alfille, Ltd.
Alie......................... 106 A.E. Alie & Sons,
Inc.
Almond....................... 63 Almond Jewelers Inc.
AMG.......................... 79 AM-Gold Products,
Inc.
APG.......................... 89 American Pewter
Guild, Ltd.
Argo......................... 17 Argo & Lehne
Jewelers.
Armel........................ 32 Armel Manufacturing
Co.
ArtCarved.................... 155 ArtCarved.
Artisans..................... 124 Artisans Jewelers,
Inc.
Assael....................... 136 Assael Int'l Inc.
Assured...................... 148 Assured Loan Co.
Astoria...................... 56 Astoria Jewelry Mfg.
Co., Inc.
Atlantic..................... 135 Atlantic Gem Corp.
Aviv......................... 40 and 41 Aviv Inc.
AWA.......................... 236 American Watch
Association.
AWI.......................... 116 American Watchmakers
Institute.
Bales........................ 156 Bales Diamond Center
& Mfg. Inc.
Bedford...................... 210 Bedford Jewelers,
Inc.
Benrus....................... 22 Benrus Watch Co.,
Inc.
Best......................... 225 Best Products Co.,
Inc.
Black Hills.................. 59 Black Hills Gold
Jewelry.
Bogo......................... 201 Jerry Bogo Co.
Boston....................... 125 Boston Findings &
Jewelers Supply Co.,
Inc.
Brant........................ 133 Brant Laird Antiques.
Brasilia..................... 143 Brasilia Gems, Inc.
Bridge....................... 163 Ben Bridge.
Brilliance................... 68 Brilliance-Diamond
Importers.
Bruce........................ 218 Donald Bruce & Co.
Canada....................... 209 Consumer & Corporate
Affairs Canada.
Capital...................... 19 Capital Mfg./L.
Dershowitz Co.
Capitol Ring................. 191 Capitol Ring Co.,
Inc.
Catholyte.................... 34 Catholyte, Inc.
Chatham...................... 231 Chatham Created Gems.
Cheviot...................... 104 Cheviot Jewelry Co.
Citizen...................... 228 Citizen Watch Co. of
America, Inc.
Classique.................... 96 Classique D'Or, Inc.
Cockrell..................... 134 Charles Cockrell.
Collins...................... 12 Collins Jewelry.
Colormasters................. 149 Colormasters Gem
Corp.
Commercial................... 202 Commercial Mineral
Co.
Consumers.................... 158 Consumers.
Courtship.................... 36 Courtship Int'l Ltd.
CPAA......................... 193 Cultured Pearl
Association of
America, Inc.
Cross........................ 165 A.T. Cross Co.
Crystal...................... 24 J.O. Crystal Co.,
Inc.
David........................ 194 W.B. David & Co.,
Inc.
Day.......................... 132 Day Co.
De'Nicole.................... 175 De'Nicole Designs.
DeMarco...................... 161 Joseph DeMarco.
Dendritics................... 167 Dendritics, Inc.
Diamonique................... 224 Diamonique Corp.
Diastar...................... 99 Diastar Inc.
Disons....................... 55 Disons Gems, Inc.
DMIA......................... 26 Diamond Manufacturers
& Importers
Association of
America, Inc.
Eastern...................... 173 Eastern Gems, Inc.
Eaton's...................... 248 Eaton's.
Eisen........................ 91 Susan Eisen.
Emkay........................ 146 Emkay Int'l, Inc.
Empire....................... 44 Empire Silver Co.,
Inc.
Estate....................... 23 Estate Jewelers.
Evvco........................ 73 Evvco Enterprises,
Inc.
Fabrikant.................... 53 M. Fabrikant & Sons.
Faleck....................... 50 Faleck & Margolies
Manufacturing, Corp.
Fame......................... 102 Fame Jewelry Inc.
Fargotstein.................. 70 S. Fargotstein &
Sons, Inc.
[[Page 27220]]
Fashion...................... 35 Fashion Line Ltd.
Fasnacht..................... 4 Fasnacht's Jewelry.
Fine......................... 141 Fine Emerald Inc.
Finlay....................... 253 Finlay Fine Jewelry
Corp.
Fischer...................... 87 Fischer Pewter, Ltd.
Flyer........................ 95 J & H Flyer.
Foster....................... 100 Foster, Inc.
Francis...................... 139 Mrs. James B.
Francis.
Franklin..................... 250 The Franklin Mint.
Friedman..................... 234 A.A. Friedman, Co.,
Inc.
G&B.......................... 30 Gudmundson & Buyck
Jewelers.
Gehrkens..................... 206 Kenneth A. Gehrkens.
Gem Vault.................... 147 The Gem Vault.
Gem Gallery.................. 131 The Gem Gallery.
Gemtron...................... 145 Gemtron Corp.
General...................... 88 General Findings.
GIA.......................... 81 Gemological Institute
of America.
Gold Institute............... 13 Gold Institute.
Golden West.................. 179 Golden West
Manufacturing
Jewelers, Inc.
Goldman...................... 60 Frederick Goldman,
Inc.
Gray......................... 127 Gray & Co.
Green........................ 6 Green Brothers.
Guyot........................ 82 Maurice F. Guyot Jr.
Handy........................ 62 Handy & Harman.
Hansen....................... 174 Dr. Gary R. Hansen.
Harten....................... 259 Harten.
Harvey....................... 75 E.B. Harvey & Co.,
Inc.
Heritage..................... 215 Heritage Metalworks,
Inc.
Honora....................... 14 and 15 Honora Jewelry Co.,
Inc.
H.R. Diamonds................ 195 H.R. Diamonds, Ltd.
ICT.......................... 189 ICT, Inc.
IJA.......................... 192 Indiana Jewelers
Association.
Ijadi........................ 171 Ijadi Gem, Inc.
Imperial..................... 117 Imperial Jade Mining,
Inc.
Impex........................ 220 Impex Diamond Corp.
ISA.......................... 237 and 237A International Society
of Appraisers.
JA........................... 3 Jewelers of America,
Inc.
Jabel........................ 47 Jabel Inc.
JCWA or Japan Watch.......... 216 Japan Clock & Watch
Association.
Jeffery...................... 21 Robert K. Jeffery.
Jewelmasters................. 110 N.E.I. Jewelmasters
of N.J. Inc.
JGL.......................... 77 JGL Inc.
JMC.......................... 1 Jewelry Merchandising
Consultants.
JVC.......................... 212 Jewelers Vigilance
Committee, Inc.
K's.......................... 45 and 98 K's Merchandise.
Kast......................... 198 Joe Kast.
Kennedy...................... 9 Kennedy's Jewelers.
Kimberley.................... 227 Kimberley Created
Emerald, Inc.
King......................... 11 King's Jewelry.
KingStone.................... 166 KingStone Gem
Importers, Ltd.
Kittle....................... 246 Clare Adams Kittle.
Knight....................... 256 George R. Knight, Jr.
Korbelak..................... 27 and 169 A. Korbelak.
Krementz..................... 208 Krementz & Co.
Kurgan....................... 107 I. Kurgan & Co., Inc.
Kwiat........................ 203 Kwiat, Inc.
Kyocera...................... 242 Kyocera America, Inc.
Lance........................ 84 The Lance Corp.
Landstrom's.................. 241 Landstrom's.
Lange........................ 183 M. Lange Co., Inc.
Lannyte...................... 65 Lannyte Co.
LaPrad....................... 181 Robert E. LaPrad.
Leach........................ 257 Leach & Garner Co.
Lee.......................... 153 Stewart M. Lee.
Leer......................... 114 Leer Gem Ltd.
Light Touch.................. 54 The Light Touch.
Limon........................ 235 Robert Limon.
Little....................... 164 Little & Co., Inc.
Littman...................... 2 Littman & Barclay
Jewelers.
London Star.................. 20 London Star Ltd.
LP Gems...................... 168 L.P. Gems, Inc.
Luria........................ 28 L. Luria & Son.
[[Page 27221]]
M&L.......................... 105 M & L Jewelry
Manufacturing Inc.
Majestic..................... 115 Majestic Setting Inc.
Majorica..................... 240 Majorica Jewelry,
Ltd.
Manning...................... 159 Manning Int'l.
MAR.......................... 37 and 42 M.A.R. Creations Inc.
Mark......................... 207 Richard C. Mark.
Mason........................ 170 Mason-Kay Inc.
Mastro....................... 190 Mastro Jewelry Corp.
Matlins...................... 205 Antoinette Leonard
Matlins.
Matthey...................... 213 Johnson Matthey.
Mayfield's................... 185 Mayfield's Co.
McGee........................ 112 McGee & Son.
MCM.......................... 152 MCM Gems.
Mendelson.................... 33 Mike Mendelson &
Assoc., Inc.
Mikimoto..................... 72 Mikimoto (America)
Co., Ltd.
MJSA......................... 226 Manufacturing
Jewelers &
Silversmiths of
America, Inc.
Moon & Star.................. 172 Moon & Star.
Morton....................... 199 Morton Jewelers.
Mueller...................... 151 Ralph Mueller &
Assoc.
Murray's..................... 264 Murray's.
Nabavian..................... 144 Nabavian Gem Co. Inc.
NACAA........................ 90 National Association
of Consumer Agency
Administrators.
NACSM........................ 219 National Association
of Catalog Showroom
Merchandisers, Inc.
Nassau....................... 10 Kurt Nassau, PhD.
NAWC......................... 251 North American Watch
Corp.
New Era...................... 129 New Era Gems.
New Castle................... 122 Kings of New Castle,
Inc.
Newhouse..................... 76 Leon M. Newhouse.
Nowlin....................... 109 Nowlin Jewelry, Inc.
NRF.......................... 238 National Retail
Federation.
NY Gold...................... 39 The New York Gold &
Diamond Exchange
Inc.
Obodda....................... 177 H. Obodda.
Ocean........................ 176 Ocean Gem.
Odi-Famor.................... 58 ODI/FAMOR, Inc.
Onyx......................... 162 House of Onyx.
Orion........................ 94 and 113 Orion Diamond
Manufacturing Co.,
Inc.
Oroco........................ 69 Oroco Manufacturing,
Inc.
Overstreet................... 8 Overstreet's Jewelry.
PanAmerican.................. 57 and 101 Pan-American Diamond
Corp.
PGI.......................... 245 Platinum Guild Int'l
U.S.A. Jewelry, Inc.
Phillips..................... 204 Phillips Jewelers,
Inc.
Philnor...................... 93 Philnor Inc.
Postal Service............... 244 United States Postal
Service.
Pounder's.................... 130 Pounder's Jewelry.
Precision.................... 121 Precision Design Inc.
Preston...................... 229 F.J. Preston & Son
Inc.
Ransom....................... 184 King's Ransom.
Rapaport..................... 233 Rapaport Corp.
Raphael...................... 78 Raphael Jewelry Co.,
Inc.
Rare Earth................... 137 Rare Earth Gallery.
Renaissance.................. 74 Renaissance.
Reys......................... 260 Rey's Jewelers.
River........................ 254 River Gems &
Findings.
Roisen....................... 31 Michal Ferman, Roisen
& Ferman, Inc.
Ross Simons.................. 67 Ross-Simons Jewelers.
Rosy Blue.................... 108 Rosy Blue Inc.
Roubins...................... 128 A. R. Roubins Sons,
Inc.
Russell...................... 217 Kenneth M. Russell.
Salisbury.................... 86 Salisbury Pewter,
Inc.
Sarantos..................... 182 Susan E. Sarantos.
Saturn....................... 46 Saturn Rings, Inc.
Schaeffer.................... 211 H.K. Schaeffer & Co.
Schneider.................... 119 Wm. Schneider Inc.
Schwartz..................... 52 Charles Schwartz.
SCI.......................... 180 Stanley Creations,
Inc.
SDGL......................... 140 San Diego Gemological
Laboratories.
Seagull...................... 111 and 120 Seagull Pewter &
Silversmiths Ltd.
Service...................... 222 Service Merchandise.
Sheaffer..................... 249 Sheaffer Inc.
Shire........................ 221 Maurice Shire Inc.
Shor......................... 258 Russell Shor.
Sibbing...................... 5 Sibbing's Jewelry.
[[Page 27222]]
Siegel....................... 255 Siegel & Assoc., Inc.
Simmons...................... 71 R.F. Simmons Co.,
Inc.
Sites........................ 123 Sites Jewelers.
Skalet....................... 61 Skalet Inc.
Soft Wear.................... 142 Soft Wear Jewelry.
Solid Gold................... 261 Solid Gold Jewelers.
Stanley...................... 83 Loyd Stanely.
Stern........................ 157 Louis P. Stern Assoc.
Stieff....................... 25 Kirk Stieff.
Suberi....................... 214 Suberi Brothers Inc.
Swezey....................... 92 Swezey of Westport
Inc.
Swiss Federation............. 232 The Federation of the
Swiss Watch
Industry.
Taylor....................... 186 Taylor Gem Corp.
Thorpe....................... 7 Thorpe & Co.
TIC.......................... 66 Tin Information
Center.
Timex........................ 239 Timex Corp.
TransAmerican................ 43 TransAmerican Jewelry
Co., Inc.
Tru-Kay...................... 196 Tru-Kay Manufacturing
Co.
Tsavomadini.................. 150 Tsavomadini Inc.
Ultimate..................... 243 Ultimate Trading
Corp.
Ultra Blue................... 160 Ultra Blue Mfg.
Union Carbide................ 38 Union Carbide.
Univ. Point.................. 126 Universal Point.
Universal.................... 178 Universal Pewter
Corp.
USWC......................... 118 U.S. Watch Council
Inc.
Vardi........................ 97 Vardi Stonehouse,
Inc.
Verstandig................... 154 Verstandig & Sons,
Inc.
Vijaydimon................... 80 and 103 Vijaydimon (U.S.A.)
Inc.
Von's........................ 16 Von's Diamond
Jewelry.
Web.......................... 85 Web Silver Co., Inc.
Weinman...................... 263 Weinman Bros, Inc.
Weitz........................ 200 Sid Weitz, Inc.
Werdiger..................... 48 Michael Werdiger,
Inc.
WGC.......................... 223 World Gold Council.
Winston...................... 252 Winston Studio &
Imports.
Woodbury..................... 64 Woodbury Pewterers,
Inc.
Zahm......................... 188 Philip Zahm.
------------------------------------------------------------------------
[FR Doc. 96-13524 Filed 5-29-96; 8:45 am]
BILLING CODE 6750-01-P
Complete official Federal Register PDF
FR Doc. 96-13523 Guides for the Metallic Watch Band Industry
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27222-27223]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13523]
=======================================================================
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
16 CFR Part 19
Guides for the Metallic Watch Band Industry
AGENCY: Federal Trade Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Federal Trade Commission (the ``Commission'') announces
that it has concluded its review of its Guides for the Metallic Watch
Band Industry (``Watch Band Guides''). In a separate document published
elsewhere in this issue of the Federal Register, the Commission is
consolidating certain provisions of the Watch Band Guides with the
Guides for the Jewelry Industry, renamed Guides for the Jewelry,
Precious Metals and Pewter Industries. The Commission has decided to
rescind the Watch Band Guides. The Commission is taking this action to
streamline the Guides.
EFFECTIVE DATE: May 30, 1996.
FOR FURTHER INFORMATION CONTACT: Constance M. Vecellio, Attorney, (202)
326-2966, or Laura J. DeMartino, Attorney, (202) 326-3030, Division of
Enforcement, Bureau of Consumer Protection, Federal Trade Commission,
Washington, DC 20580.
SUPPLEMENTARY INFORMATION: The Guides for the Metallic Watch Band
Industry (``Watch Band Guides''), 16 CFR Part 19, address claims made
about watch bands that are not permanently attached to watchcases. The
Commission requested public comment on the Watch Band Guides, the
Guides for the Jewelry Industry (``Jewelry Guides''), 16 CFR Part 23,
and the Guides for the Watch Industry, 16 CFR Part 245.1 Much of
the material in the Watch Band Guides duplicates information in the
Jewelry Guides. For the reasons discussed in greater detail in the
Federal Register Notice announcing revisions to the Jewelry Guides, the
Commission is consolidating some of the provisions of the Watch Band
Guides into the Jewelry Guides. Therefore, the Commission is rescinding
the Watch Band Guides. On the basis of the discussion in the
Commission's announcement of revisions to the Jewelry Guides, which is
located elsewhere in this issue of the Federal Register, and which is
incorporated herein, 16 CFR Part 19 is hereby rescinded.
---------------------------------------------------------------------------
\1\ 57 FR 24996 (June 12, 1992). The Commission published this
Federal Register Notice soliciting comment, in response to a
petition from the Jewelers Vigilance Committee (``JVC''). Among
other revisions, the JVC proposed consolidating all three Guides
into one.
---------------------------------------------------------------------------
List of Subjects in 16 CFR Part 19
Advertising, Watch bands, Trade practices.
PART 19--[REMOVED]
The Commission under the authority of Section 5(a)(1) of the
Federal Trade Commission Act, 15 U.S.C. 45(a)(1), amends chapter I of
Title 16 of the Code
[[Page 27223]]
of Federal Regulations by removing Part 19.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 96-13523 Filed 5-29-96; 8:45 am]
BILLING CODE 6750-01-P
Complete official Federal Register PDF
FR Doc. 96-13474 Pacific Halibut Fisheries; 1996 Halibut Landing Report No. 1
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27025-27026]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13474]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric Administration
50 CFR Part 301
[Docket No. 960111003-6068-03; I.D. 052196B]
Pacific Halibut Fisheries; 1996 Halibut Landing Report No. 1
AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA), Commerce.
ACTION: Inseason action.
-----------------------------------------------------------------------
SUMMARY: The Assistant Administrator for Fisheries, NOAA, on behalf of
the International Pacific Halibut Commission (IPHC), publishes these
inseason actions pursuant to IPHC regulations approved by the U.S.
Government to govern the Pacific halibut fishery. This action is
intended to enhance the conservation of the Pacific halibut stock.
EFFECTIVE DATE: Non-treaty commercial fishing period for Area 2A: 8
a.m. through 6 p.m., Pacific local time, July 10, 1996.
FOR FURTHER INFORMATION CONTACT: Steven Pennoyer, 907-586-7221; William
W. Stelle, Jr., 206-526-6140; or Donald McCaughran, 206-634-1838.
SUPPLEMENTARY INFORMATION: The IPHC, under the Convention between the
United States of America and Canada for the Preservation of the Halibut
Fishery of the Northern Pacific Ocean and Bering Sea (signed at Ottawa,
Ontario, on March 2, 1953), as amended by a Protocol Amending the
Convention (signed at Washington, DC, on March 29, 1979), has issued
this inseason action pursuant to IPHC regulations governing the Pacific
halibut fishery. The regulations have been approved by NMFS (60 FR
14651, March 20, 1995, and amended at 61 FR 11337, March 20, 1996). On
behalf of the IPHC, this inseason action is published in the Federal
Register to provide additional notice of its effectiveness, and to
inform persons subject to the inseason action of the restrictions and
requirements established therein.
Inseason Action
1996 Halibut Landing Report No. 1
Non-treaty Commercial Fishing Period Limits in Area 2A
The Commission has determined that fishing period limits will be
required during the 10-hour, July 10 non-treaty directed commercial
fishing period in Area 2A to avoid exceeding the 91,052 pound (41.90
metric tons (mt)) catch limit. The July 10 fishing period will begin at
8:00 a.m. and end at 6:00 p.m. The fishery is restricted to waters that
are south of Point Chehalis, Washington (46 deg.53'18'' N. latitude)
under regulations promulgated by National Marine Fisheries Service.
Fishing period limits as indicated in the following table will be in
effect for this opening.
------------------------------------------------------------------------
Vessel class Fishing period limit (pounds)
------------------------------------------------------------------------
Length Letter Dressed, head-on Dressed, head-off
---------------------------------------------------------------*--------
0-25........... A 285 250
26-30........... B 360 315
31-35........... C 575 505
36-40........... D 1,580 1,390
41-45........... E 1,700 1,495
46-50........... F 2,035 1,790
51-55........... G 2,265 1,995
56+ ........... H 3,410 3,000
------------------------------------------------------------------------
* Weights are after 2 percent has been deducted for ice and slime if
fish are not washed prior to weighing.
[[Page 27026]]
The appropriate vessel length class and letter is printed on each
vessel license.
The fishing period limit is shown in terms of dressed, head-off
weight as well as dressed, head-on weight, although fishermen are
reminded that regulations require that all halibut from Area 2A be
landed with the head on.
The fishing period limit applies to the vessel, not the individual
fisherman, and any landings over the vessel limit will be subject to
forfeiture and fine.
Northwest Treaty Tribes Fishery in Area 2A
Northwest treaty Indian tribes were allocated a total allowable
catch of 182,000 pounds (82.55 mt) in subarea 2A-1 (northern Washington
coast) in 1996. Of this total, 14,000 pounds (6.35 mt) are reserved for
ceremonial and subsistence purposes, leaving 168,000 pounds (76.20 mt)
for the commercial fishery.
As of April 1, 1996, the total commercial catch in subarea 2A-1 was
166,000 pounds (75.29 mt). A restricted commercial fishery occurred
March 15 to April 1, producing 12,000 pounds (5.44 mt). Two directed
commercial fishing periods produced a total of 154,000 pounds (69.85
mt). A decision whether to reopen subarea 2A-1 to catch the 2,000
pounds (0.90 mt) remaining in the catch limit will be made later.
Area 2B Commercial Fishery Update
Halibut landings from Area 2B total 3.0 million pounds (1,360.79
mt) through May 6, leaving 6.52 million pounds (2,957.45 mt) of the
catch limit to be caught. The fishery will continue until all
Individual Vessel Quotas have been filled, or November 15, whichever is
earlier.
Annette Island Reserve Fishery in Area 2C
The Metlakatla Indian community has been authorized by the United
States Government to conduct a commercial halibut fishery within the
Annette Island Reserve. One 48-hour fishing period occurred between
April 27-29, producing a total catch of 3,050 pounds (1.38 mt).
Alaskan Commercial Fishery Update
It is estimated that the following catches and number of landings
were made in the Alaskan Individual Fishing Quota (IFQ) fishery through
May 1, 1996. No Community Development Quota landings have been made.
----------------------------------------------------------------------------------------------------------------
Catch limit Catch (000's No. of
Area (000's pounds) pounds) landings
----------------------------------------------------------------------------------------------------------------
2C.............................................................. 9,000 2,354 603
3A.............................................................. 20,000 3,786 493
3B.............................................................. 3,700 215 35
4A.............................................................. 1,950 26 4
4B.............................................................. 2,310 13 1
4C.............................................................. 770 0 0
4D.............................................................. 770 0 0
4E.............................................................. 120 0 0
-----------------------------------------------
Total....................................................... 38,620 6,394 1,136
----------------------------------------------------------------------------------------------------------------
During the same time period in 1995, March 15 through May 2, 2.5
million pounds (11,339.92 mt) were landed in the Alaskan IFQ fishery.
Dated: May 23, 1996.
Richard W. Surdi,
Acting Director, Office of Fisheries Conservation and Management,
National Marine Fisheries Service.
[FR Doc. 96-13474 Filed 5-29-96; 8:45 am]
BILLING CODE 3510-22-W
Complete official Federal Register PDF
FR Doc. 96-13398 Reporting of Nonpayroll Withheld Tax Liabilities
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27007-27008]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13398]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
26 CFR Parts 31 and 602
[TD 8672]
RIN 1545-AT86
Reporting of Nonpayroll Withheld Tax Liabilities
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: This document contains final regulations relating to the
reporting of nonpayroll withheld income taxes under section 6011 of the
Internal Revenue Code. The final regulations require a person to file
Form 945, Annual Return of Withheld Federal Income Tax, only for a
calendar year in which the person is required to withhold Federal
income tax from nonpayroll payments.
EFFECTIVE DATE: These regulations are effective May 30, 1996.
FOR FURTHER INFORMATION CONTACT: Vincent G. Surabian, 202-622-6232 (not
a toll-free number).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information contained in these final regulations
has been reviewed and approved by the Office of Management and Budget
in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under
control number 1545-1413. Responses to this collection of information
are required by the IRS to monitor compliance with the Federal tax
rules related to the reporting and deposit of nonpayroll withheld
income taxes.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless the collection of
information displays a valid control number.
Estimates of the reporting burden in these final regulations are
reflected in the burden of Form 945.
Comments concerning the accuracy of this burden estimate and
suggestions for reducing this burden should be sent to the Internal
Revenue Service, Attn: IRS Reports Clearance Officer, T:FP, Washington,
DC 20224, and to the Office of Management and Budget, Attn: Desk
Officer for the Department of the Treasury, Office of Information and
Regulatory Affairs, Washington, DC 20503.
Books or records relating to this collection of information must be
retained as long as their contents may become material in the
administration of any internal revenue law. Generally, tax returns and
tax return information are confidential, as required by 26 U.S.C. 6103.
Background
On October 16, 1995, final and temporary regulations (TD 8624)
relating to the reporting of nonpayroll withheld income taxes under
section 6011 were published in the Federal Register (60 FR 53509). A
notice of proposed rulemaking (IA-30-95) cross-referencing the
temporary regulations was published in the Federal Register for the
same day (60 FR 53561).
The IRS received no written comments responding to the notice.
Accordingly, the regulations proposed by IA-30-95 are adopted as
proposed with a minor editorial change.
Explanation of Provisions
These final regulations remove the requirement that, once a person
files a Form 945 for a calendar year, the person must file a Form 945
every subsequent year until the person files a final return. Under
these final regulations, a person must file a Form 945 only for a
calendar year in which the person is required to withhold Federal
income tax from nonpayroll payments.
Special Analyses
It has been determined that this Treasury decision is not a
significant regulatory action as defined in EO 12866. Therefore, a
regulatory assessment is not required. It also has been determined that
section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5)
and the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to
these regulations, and, therefore, a Regulatory Flexibility Analysis is
not required. Pursuant to section 7805(f) of the Internal Revenue
[[Page 27008]]
Code, the notice of proposed rulemaking preceding these regulations was
submitted to the Small Business Administration for comment on its
impact on small business.
Drafting Information. The principal author of these regulations
is Vincent G. Surabian, Office of the Assistant Chief Counsel
(Income Tax & Accounting). However, other personnel from the IRS and
Treasury Department participated in their development.
List of Subjects
26 CFR Part 31
Employment taxes, Income taxes, Penalties, Pensions, Railroad
retirement, Reporting and recordkeeping requirements, Social security,
Unemployment compensation.
26 CFR Part 602
Reporting and recordkeeping requirements.
Adoption of Amendments to the Regulations
Accordingly, 26 CFR parts 31 and 602 are amended as follows:
PART 31--EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE
Paragraph 1. The authority citation for part 31 is amended by
removing the citation for ``Section 31.6011(a)-4T'' as follows:
Authority: 26 U.S.C. 7805 * * *.
Par 2. Section 31.6011(a)-4 is amended by revising paragraph (b) to
read as follows:
Sec. 31.6011(a)-4 Returns of income tax withheld.
* * * * *
(b) Withheld from nonpayroll payments. Every person required to
withhold tax from nonpayroll payments for calendar year 1994 must make
a return for calendar year 1994 and for any subsequent calendar year in
which the person is required to withhold such tax until the person
makes a final return in accordance with Sec. 31.6011(a)-6. Every person
not required to withhold tax from nonpayroll payments for calendar year
1994 must make a return for the first calendar year after 1994 in which
the person is required to withhold such tax and for any subsequent
calendar year in which the person is required to withhold such tax
until the person makes a final return in accordance with
Sec. 31.6011(a)-6. Form 945, Annual Return of Withheld Federal Income
Tax, is the form prescribed for making the return required under this
paragraph (b). Nonpayroll payments are--
(1) Certain gambling winnings subject to withholding under section
3402(q);
(2) Retirement pay for services in the Armed Forces of the United
States subject to withholding under section 3402;
(3) Certain annuities as described in section 3402(o)(1)(B);
(4) Pensions, annuities, IRAs, and certain other deferred income
subject to withholding under section 3405; and
(5) Reportable payments subject to backup withholding under section
3406.
* * * * *
Sec. 31.6011(a)-4T [Removed]
Par. 3. Section 31.6011(a)-4T is removed.
PART 602--OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT
Par. 4. The authority citation for part 602 continues to read as
follows:
Authority: 26 U.S.C. 7805.
Sec. 602.101 [Amended]
Par. 5. Section 602.101, paragraph (c) is amended in the table by
removing the entry ``31.6011(a)-4T....1545-1413''.
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved: April 5, 1996.
Leslie Samuels,
Assistant Secretary of the Treasury.
[FR Doc. 96-13398 Filed 5-29-96; 8:45 am]
BILLING CODE 4830-01-P
Complete official Federal Register PDF
FR Doc. 96-13298 Payment by Employer of Expenses for Meals and Entertainment, Club Dues, and Spousal Travel
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27005-27007]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13298]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 8666]
RIN 1545-AS74
Payment by Employer of Expenses for Meals and Entertainment, Club
Dues, and Spousal Travel
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: This document contains final regulations relating to
reimbursement and other expense allowance arrangements for expenses of
business meals and entertainment that are disallowed as a deduction
under section 274(n), and working condition fringe benefit treatment
for expenses for club dues and spousal travel that are disallowed as a
deduction under sections 274(a)(3) and 274(m)(3). The final regulations
reflect changes to the law made by the Omnibus Budget Reconciliation
Act of 1993. The persons affected by the final regulations are persons
who provide or receive the use of business meals and entertainment,
club membership dues, or spousal travel expenses.
EFFECTIVE DATE: May 30, 1996.
FOR FURTHER INFORMATION CONTACT: Concerning regulations under sections
62 and 132, David N. Pardys, (202) 622-6040; concerning regulations
under section 274, John T. Sapienza, Jr., (202) 622-4920 (not toll-free
numbers).
SUPPLEMENTARY INFORMATION:
Background
On December 16, 1994, a notice of proposed rulemaking relating to
payment by an employer of expenses for business meals and
entertainment, club dues, and spousal travel was published in the
Federal Register (59 FR 64909). A public hearing was held on April 14,
1995.
Written comments responding to the notice were received. After
consideration of all the comments, the proposed regulations are adopted
as revised by this Treasury decision. The significant comments on the
proposed regulations and the principal revisions made in the final
regulations are discussed below.
Explanation of Provisions
This Treasury decision contains final regulations to the Income Tax
Regulations under sections 62(c), 132(d), and 274 of the Internal
Revenue Code (Code) to reflect changes made to section 274 of the Code
by sections 13209, 13210, and 13272 of OBRA (107 Stat. 469, 542). The
OBRA provisions amended section 274 of the Code by (1) limiting the
deductible portion of meal and entertainment expenses to 50 percent;
(2) eliminating the deduction for club dues; and (3) restricting the
deduction for spousal travel. The amendments to the regulations under
sections 62 and 132 of the Code concern the income tax consequences to
employees when their employer's (or third party payor's) deduction is
disallowed by the amendments to section 274 of the Code.
Comments to the proposed regulations concerned whether payment of
expenses for club dues and spousal travel by an employer exempt from
taxation under subtitle A of the Internal Revenue Code were eligible
for the working condition fringe exclusion. The final regulations
provide that any reference in the regulations to an employer's
deduction disallowed by sections 274(a)(3) or 274(m)(3) of the Code
will be treated as a reference to the amount which would be disallowed
as a deduction to the employer if the employer were not exempt from
taxation.
Other comments suggested that the final regulation extend the
section 274(e)(2) option of an employer to avoid the section 274
disallowance for payment of spousal travel to persons who pay expenses
described in section 274(e)(9). To achieve consistent results for
payments to independent contractors and employees with respect to
spousal travel, the final regulations adopted this suggestion.
A number of comments requested clarification of the term other
individual in section 274(m)(3). In particular, the comments asked that
the term be clarified so as not to preclude the deduction for travel
expenses of a business associate accompanying the taxpayer (or an
officer or employee of the taxpayer) on business travel. The regulation
was amended to reflect these comments.
One comment concerned the person to whom a fringe benefit is
taxable. The rules concerning to whom a fringe benefit is taxable are
set forth in Sec. 1.61-21(a)(4). For rules concerning volunteers, see
Sec. 1.132-5(r).
Several comments involved the amount of the employer's disallowed
deduction when the expenses of a spouse, dependent, or other individual
accompanying an employee on a noncommercial flight qualify as a working
condition fringe benefit. This issue is under further consideration. In
addition, other comments requested clarification of what constitutes a
deductible expenditure for spousal travel under the general rule of
section 162(a). The rules for deducting travel expenses of a spouse are
in Sec. 1.162-2(c).
Special Analyses
It has been determined that this Treasury decision is not a
significant regulatory action as defined in EO 12866. Therefore, a
regulatory assessment is not required. It has also been determined that
section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5)
and the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to
these regulations, and, therefore, a Regulatory Flexibility Analysis is
not required. Pursuant to section 7805(f) of the Internal Revenue Code,
the notice of proposed rulemaking preceding these regulations was
submitted to the Small Business Administration for comment on its
impact on small business.
Drafting Information. The principal authors of these regulations
are David N. Pardys, Office of the Associate Chief Counsel (Employee
Benefits and Exempt Organizations), and John T. Sapienza, Jr.,
Office of the Assistant Chief Counsel (Income Tax and Accounting),
IRS. Personnel from other offices of the IRS and Treasury Department
also participated in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Amendments to the Regulations
Accordingly, 26 CFR part 1 is amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 continues to read,
in part, as follows:
Authority: 26 U.S.C. 7805 * * *.
Par. 2. In Sec. 1.62-2, paragraph (h)(1) is amended by adding a
second sentence at the end of the paragraph to read as follows:
Sec. 1.62-2 Reimbursements and other expense allowance arrangements.
* * * * *
[[Page 27006]]
(h) * * * (1) * * * If an arrangement provides advances,
allowances, or reimbursements for meal and entertainment expenses and a
portion of the payment is treated as paid under a nonaccountable plan
under paragraph (d)(2) of this section due solely to section 274(n),
then notwithstanding paragraph (h)(2)(ii) of this section, these
nondeductible amounts are neither treated as gross income nor subject
to withholding and payment of employment taxes.
* * * * *
Par. 3. In Sec. 1.132-5, paragraphs (s) and (t) are added to read
as follows:
Sec. 1.132-5 Working condition fringes.
* * * * *
(s) Application of section 274(a)(3)--(1) In general. If an
employer's deduction under section 162(a) for dues paid or incurred for
membership in any club organized for business, pleasure, recreation, or
other social purpose is disallowed by section 274(a)(3), the amount, if
any, of an employee's working condition fringe benefit relating to an
employer-provided membership in the club is determined without regard
to the application of section 274(a) to the employee. To be excludible
as a working condition fringe benefit, however, the amount must
otherwise qualify for deduction by the employee under section 162(a).
If an employer treats the amount paid or incurred for membership in any
club organized for business, pleasure, recreation, or other social
purpose as compensation under section 274(e)(2), then the expense is
deductible by the employer as compensation and no amount may be
excluded from the employee's gross income as a working condition fringe
benefit. See Sec. 1.274-2(f)(2)(iii)(A).
(2) Treatment of tax-exempt employers. In the case of an employer
exempt from taxation under subtitle A of the Internal Revenue Code, any
reference in this paragraph (s) to a deduction disallowed by section
274(a)(3) shall be treated as a reference to the amount which would be
disallowed as a deduction by section 274(a)(3) to the employer if the
employer were not exempt from taxation under subtitle A of the Internal
Revenue Code.
(3) Examples. The following examples illustrate this paragraph (s):
Example 1. Assume that Company X provides Employee B with a
country club membership for which it paid $20,000. B substantiates,
within the meaning of paragraph (c) of this section, that the club
was used 40 percent for business purposes. The business use of the
club (40 percent) may be considered a working condition fringe
benefit, notwithstanding that the employer's deduction for the dues
allocable to the business use is disallowed by section 274(a)(3), if
X does not treat the club membership as compensation under section
274(e)(2). Thus, B may exclude from gross income $8,000 (40 percent
of the club dues, which reflects B's business use). X must report
$12,000 as wages subject to withholding and payment of employment
taxes (60 percent of the value of the club dues, which reflects B's
personal use). B must include $12,000 in gross income. X may deduct
as compensation the amount it paid for the club dues which reflects
B's personal use provided the amount satisfies the other
requirements for a salary or compensation deduction under section
162.
Example 2. Assume the same facts as Example 1 except that
Company X treats the $20,000 as compensation to B under section
274(e)(2). No portion of the $20,000 will be considered a working
condition fringe benefit because the section 274(a)(3) disallowance
will apply to B. Therefore, B must include $20,000 in gross income.
(t) Application of section 274(m)(3)--(1) In general. If an
employer's deduction under section 162(a) for amounts paid or incurred
for the travel expenses of a spouse, dependent, or other individual
accompanying an employee is disallowed by section 274(m)(3), the
amount, if any, of the employee's working condition fringe benefit
relating to the employer-provided travel is determined without regard
to the application of section 274(m)(3). To be excludible as a working
condition fringe benefit, however, the amount must otherwise qualify
for deduction by the employee under section 162(a). The amount will
qualify for deduction and for exclusion as a working condition fringe
benefit if it can be adequately shown that the spouse's, dependent's,
or other accompanying individual's presence on the employee's business
trip has a bona fide business purpose and if the employee substantiates
the travel within the meaning of paragraph (c) of this section. If the
travel does not qualify as a working condition fringe benefit, the
employee must include in gross income as a fringe benefit the value of
the employer's payment of travel expenses with respect to a spouse,
dependent, or other individual accompanying the employee on business
travel. See Secs. 1.61-21(a)(4) and 1.162-2(c). If an employer treats
as compensation under section 274(e)(2) the amount paid or incurred for
the travel expenses of a spouse, dependent, or other individual
accompanying an employee, then the expense is deductible by the
employer as compensation and no amount may be excluded from the
employee's gross income as a working condition fringe benefit. See
Sec. 1.274-2(f)(2)(iii)(A).
(2) Treatment of tax-exempt employers. In the case of an employer
exempt from taxation under subtitle A of the Internal Revenue Code, any
reference in this paragraph (t) to a deduction disallowed by section
274(m)(3) shall be treated as a reference to the amount which would be
disallowed as a deduction by section 274(m)(3) to the employer if the
employer were not exempt from taxation under subtitle A of the Internal
Revenue Code.
Par. 4. The last sentence of Sec. 1.274-1 is revised to read as
follows:
Sec. 1.274-1 Disallowance of certain entertainment, gift and travel
expenses.
* * * For specific provisions with respect to the deductibility of
expenditures: for an activity of a type generally considered to
constitute entertainment, amusement, or recreation, and for a facility
used in connection with such an activity, as well as certain travel
expenses of a spouse, etc., see Sec. 1.274-2; for expenses for gifts,
see Sec. 1.274-3; for expenses for foreign travel, see Sec. 1.274-4;
for expenditures deductible without regard to business activity, see
Sec. 1.274-6; and for treatment of personal portion of entertainment
facility, see Sec. 1.274-7.
Par. 5. Section 1.274-2 is amended as follows:
1. The section heading for Sec. 1.274-2 is revised.
2. In paragraph (c)(6), a second sentence is added at the end of
the paragraph.
3. The paragraph heading for paragraph (f)(2)(i) is revised.
4. Paragraph (f)(2)(iii) is revised.
5. Paragraph (g) is added.
The revised and added provisions read as follows:
Sec. 1.274-2 Disallowance of deductions for certain expenses for
entertainment, amusement, recreation, or travel.
* * * * *
(c) * * *
(6) * * * This paragraph (c)(6) applies to club dues paid or
incurred before January 1, 1987.
* * * * *
(f) * * *
(2) * * *
(i) Business meals and similar expenditures paid or incurred before
January 1, 1987--* * *
* * * * *
(iii) Certain entertainment and travel expenses treated as
compensation--(A) In general. Any expenditure by a taxpayer for
entertainment (or for use of a facility in connection therewith) or for
travel described in section 274(m)(3), if an employee is the recipient
of the
[[Page 27007]]
entertainment or travel, is not subject to the limitations on
allowability of deductions provided for in paragraphs (a) through (e)
of this section to the extent that the expenditure is treated by the
taxpayer--
(1) On the taxpayer's income tax return as originally filed, as
compensation paid to the employee; and
(2) As wages to the employee for purposes of withholding under
chapter 24 (relating to collection of income tax at source on wages).
(B) Expenses includible in income of persons who are not employees.
Any expenditure by a taxpayer for entertainment (or for use of a
facility in connection therewith), or for travel described in section
274(m)(3), is not subject to the limitations on allowability of
deductions provided for in paragraphs (a) through (e) of this section
to the extent the expenditure is includible in gross income as
compensation for services rendered, or as a prize or award under
section 74, by a recipient of the expenditure who is not an employee of
the taxpayer. The preceding sentence shall not apply to any amount paid
or incurred by the taxpayer if such amount is required to be included
(or would be so required except that the amount is less that $600) in
any information return filed by such taxpayer under part III of
subchapter A of chapter 61 and is not so included. See section
274(e)(9).
(C) Example. The following example illustrates the provisions this
paragraph (f):
Example. If an employer rewards the employee (and the employee's
spouse) with an expense paid vacation trip, the expense is
deductible by the employer (if otherwise allowable under section 162
and the regulations thereunder) to the extent the employer treats
the expenses as compensation and as wages. On the other hand, if a
taxpayer owns a yacht which the taxpayer uses for the entertainment
of business customers, the portion of salary paid to employee
members of the crew which is allocable to use of the yacht for
entertainment purposes (even though treated on the taxpayer's tax
return as compensation and treated as wages for withholding tax
purposes) would not come within this exception since the members of
the crew were not recipients of the entertainment. If an expenditure
of a type described in this subdivision properly constitutes a
dividend paid to a shareholder or if it constitutes unreasonable
compensation paid to an employee, nothing in this exception prevents
disallowance of the expenditure to the taxpayer under other
provisions of the Internal Revenue Code.
* * * * *
(g) Additional provisions of section 274--travel of spouse,
dependent or others. Section 274(m)(3) provides that no deduction shall
be allowed under this chapter (except section 217) for travel expenses
paid or incurred with respect to a spouse, dependent, or other
individual accompanying the taxpayer (or an officer or employee of the
taxpayer) on business travel, unless certain conditions are met. As
provided in section 274(m)(3), the term other individual does not
include a business associate (as defined in paragraph (b)(2)(iii) of
this section) who otherwise meets the requirements of sections
274(m)(3)(B) and (C).
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved: March 26, 1996.
Leslie Samuels,
Assistant Secretary of the Treasury.
[FR Doc. 96-13298 Filed 5-29-96; 8:45 am]
BILLING CODE 4830-01-P
Complete official Federal Register PDF
FR Doc. 96-13240 Office of the Assistant Secretary for Public and Indian Housing; Section 8 Tenant-Based Programs: Technical Amendments
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27162-27163]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13240]
[[Page 27161]]
_______________________________________________________________________
Part III
Department of Housing and Urban Development
_______________________________________________________________________
24 CFR Parts 982 and 983
Section 8 Tenant-Based Programs: Technical Amendments; Final Rule
Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / Rules
and Regulations
[[Page 27162]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 982 and 983
[Docket No. FR-4055-F-01]
RIN 2577-AB64
Office of the Assistant Secretary for Public and Indian Housing;
Section 8 Tenant-Based Programs: Technical Amendments
AGENCY: Office of the Assistant Secretary for Public and Indian
Housing, HUD.
ACTION: Final rule; technical amendments.
-----------------------------------------------------------------------
SUMMARY: The purpose of this document is to make technical amendments
to the final rule governing the tenant-based rental certificate and
voucher programs. These technical amendments are necessary to add
provisions that were inadvertently omitted from one section of the
earlier final rule, and to clarify the original intent of certain other
provisions. These amendments have the effect of clarifying the
regulations for these programs.
EFFECTIVE DATE: July 1, 1996.
FOR FURTHER INFORMATION CONTACT: Madeline Hastings, Associate Deputy
Assistant Secretary for the Office of Public and Assisted Housing
Operations, Room 4204, Department of Housing and Urban Development, 451
Seventh Street SW., Washington, DC 20410-7000, telephone (202) 708-1842
(voice) [not a toll-free telephone number]. Hearing or speech-impaired
individuals may access that office by text telephone by dialing 1-800-
877-8339 to use the Federal Information Relay Service. Copies of this
document will be made available on tape or large print for those with
impaired vision that request them. They may be obtained at the above
address.
SUPPLEMENTARY INFORMATION:
I. Background
A. History of Rule
There were two principal rules issued concerning the Section 8
Certificate and Voucher programs in the last two years: The rule
governing admission requirements, establishing subparts A and E,
published on July 18, 1994 (59 FR 36662) and the rule fleshing out part
982 by establishing subparts B-D and G-L, published on July 3, 1995 (60
FR 34660). Since their publication, it has come to the attention of the
Department that several changes that had been intended to be included
in these rules were omitted. These changes are being made in this final
rule.
B. Changes to Rule
Section 982.54, dealing with the administrative plan, is modified
to add provisions to the administrative plan that were inadvertently
omitted in the final rule. While these policies are clearly stated in
other sections of the final regulations, these are policies on matters
for which the HA has discretion to establish local policies and,
therefore, must be included in the administrative plan.
Language in Secs. 982.158, 982.202, 982.205, 982.301, 982.307,
982.353, 982.355, 982.401, 982.451, and 982.551 is revised to clarify
original intent. In addition, a new paragraph (e)(4) is added to
Sec. 982.355 to provide that the administrative fee may be reduced as a
sanction for noncompliance with portability requirements, consistent
with the regulatory sanction for noncompliance with other HA program
responsibilities.
The only change to part 983 is to correct a typographical error
found in Sec. 983.203.
II. Justification for Final Rulemaking
HUD generally publishes a rule for public comment before issuing a
rule for effect, in accordance with its own regulations on rulemaking
in 24 CFR part 10. However, part 10 provides for exceptions to the
general rule if the agency finds good cause to omit advance notice and
public participation. The good cause requirement is satisfied when
prior public procedure is ``impracticable, unnecessary, or contrary to
the public interest'' (24 CFR 10.1). HUD finds that good cause exists
to publish this rule for effect without first soliciting public
comment. HUD believes that it is unnecessary and contrary to the public
interest to delay the effectiveness of the rule for public comment,
since the rule merely makes technical and clarifying changes.
III. Other Matters
Regulatory Flexibility Act
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed and approved this rule, and in so doing
certifies that this rule will not have a significant economic impact on
a substantial number of small entities (or any other entities), since
it merely makes technical amendments.
Environmental Impact
A Finding of No Significant Impact with respect to the environment
was made in accordance with HUD regulations in 24 CFR part 50 that
implement section 102(2)(C) of the National Environmental Policy Act of
1969 (42 U.S.C. 4332) with respect to the original Part 982 issued in
1994. This Finding is available for public inspection between 7:30 a.m.
and 5:30 p.m. weekdays in the Office of the Rules Docket Clerk, Office
of General Counsel, Room 10276, Department of Housing and Urban
Development, 451 Seventh Street, SW, Washington, DC.
Executive Order 12612, Federalism
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that this rule
will not have substantial direct effects on States or their political
subdivisions, or the relationship between the Federal government and
the States, or on the distribution of power and responsibilities among
the various levels of government, since it only makes technical
amendments.
Executive Order 12606, The Family
The General Counsel, as the Designated Official under Executive
Order 12606, The Family, has determined that this rule will not have
the potential for significant impact on family formation, maintenance,
or general well-being, and thus is not subject to review under the
Order.
List of Subjects
24 CFR Part 982
Grant programs--housing and community development, Housing, Rent
subsidies, Reporting and recordkeeping requirements.
24 CFR Part 983
Grant programs--housing and community development, Rent subsidies,
Reporting and recordkeeping requirements.
Catalog
The catalog of Federal Domestic Assistance numbers for the programs
affected by this rule are 14.855 (Vouchers), 14.856 (Moderate
Rehabilitation), and 14.857 (Certificates).
Accordingly, parts 982 and 983 of title 24 of the Code of Federal
Regulations, are amended as follows:
[[Page 27163]]
PART 982--SECTION 8 TENANT-BASED ASSISTANCE: UNIFIED RULE FOR
TENANT-BASED ASSISTANCE UNDER THE SECTION 8 RENTAL CERTIFICATE
PROGRAM AND THE SECTION 8 RENTAL VOUCHER PROGRAM
1-3. The authority citation for part 982 continues to read as
follows:
Authority: 42 U.S.C. 1437f and 3535(d).
Sec. 982.54 [Amended]
4. Section 982.54(d) is amended as follows:
a. By adding to paragraph (d)(1) after the word ``preferences'' the
phrase ``(see Secs. 982.202(b)(2) and 982.208(b)), procedures for
removing applicant names from the waiting list,''.
b. By removing from paragraph (d)(15) the word ``and'' after the
semicolon;
c. By removing from paragraph (d)(16) the period at the end of the
sentence and adding in its place a semicolon; and
d. By adding new paragraphs (d)(17), (d)(18) and (d)(19), to read
as follows:
Sec. 982.54 Administrative plan.
* * * * *
(d) * * *
(17) Interim redeterminations of family income and composition;
(18) Restrictions, if any, on the number of moves by a participant
family (see Sec. 982.314(c)); and
(19) Approval by the Board of Commissioners or other authorized
officials to charge the administrative fee reserve.
* * * * *
5. In Sec. 982.158, paragraph (d) is revised to read as follows:
Sec. 982.158 Program accounts and records.
* * * * *
(d) The HA must prepare a unit inspection report.
* * * * *
Sec. 982.202 [Amended]
6. In Sec. 982.202, the heading of paragraph (a) is revised to read
``Waiting list admissions and special admissions.''
7. In Sec. 982.202, the second sentence of paragraph (b)(2) is
revised to read as follows:
Sec. 982.202 How applicants are selected: General requirements.
* * * * *
(b) * * *
(2) * * * However, the HA may target assistance for families who
live in public housing or other federally assisted housing, or may
adopt a HUD-approved residency preference (see Sec. 982.208).
* * * * *
8. In Sec. 982.205, the section heading and paragraph (a)(1) are
revised to read as follows:
Sec. 982.205 Waiting list: Single list; area covered.
(a) * * *
(1) An HA must use a single waiting list for admissions to its
tenant-based certificate and voucher programs. The HA may use a
separate waiting list for such admissions for an area not smaller than
a county or municipality.
* * * * *
Sec. 982.301 [Amended]
9. In Sec. 982.301, paragraph (b) is amended as follows:
a. Paragraph (b)(4) is removed and the remaining paragraphs are
redesignated (b)(4) through (b)(16); and
b. In redesignated paragraph (b)(10), the word ``HUD'' is removed
and the word ``HUD-required'' is added in its place.
Sec. 982.307 [Amended]
10. In Sec. 982.307, paragraph (b)(1)(i) is amended by adding ``and
prior'' after the word ``current''.
Sec. 982.353 [Amended]
11. In Sec. 982.353(b), the first sentence is amended by removing
the reference to ``paragraph (c)'' and adding in its place a reference
to ``paragraph (c) or (d)''.
12. Section 982.355 is amended as follows:
a. Paragraph (b)(2) is revised;
b. A new paragraph (b)(3) is added;
c. A new sentence is added at the end of paragraph (e)(3);
d. The third sentence of paragraph (e)(5) is removed; and
e. Paragraph (e)(4) is revised, to read as follows:
Sec. 982.355 Portability: Administration by receiving HA.
* * * * *
(b) * * *
(2) If the family was receiving assistance under the initial HA
certificate program, but is ineligible for admission to the voucher
program, a receiving HA must provide continued assistance under the
certificate program. If the family was receiving assistance under the
initial HA voucher program, but is ineligible for admission to the
certificate program, a receiving HA must provide continued assistance
under the voucher program.
(3) If a receiving HA is absorbing the family into its own program
(i.e., providing assistance without billing the initial HA), the
receiving HA has the choice of assisting the family under either the
certificate or voucher program. If a receiving HA is not absorbing the
family into its own program, the receiving HA must assist the family
under the same program (certificate program or voucher program) as the
initial HA.
* * * * *
(e) * * *
(3) * * * If both HAs agree, the HAs may negotiate a different
amount of reimbursement.
(4) HUD may reduce the administrative fee to an initial or
receiving HA if the HA does not comply with HUD portability
requirements.
* * * * *
13. In Sec. 982.401, paragraph (j)(3)(iv)(B) is revised to read as
follows:
Sec. 982.401 Housing quality standards (HQS).
* * * * *
(j) * * *
(3) * * *
(iv) * * *
(B) The entrance and hallway providing access to a unit in a multi-
unit building; and
* * * * *
Sec. 982.451 [Amended]
14. In Sec. 982.451, the third sentence of paragraph (c)(5) is
amended by adding ``another source is'' after the word ``unless''.
15. In Sec. 982.551, paragraph (h)(2) is amended by adding a
sentence at the end to read as follows:
Sec. 982.551 Obligations of participant.
* * * * *
(h) * * *
(2) * * * No other person [i.e., nobody but members of the assisted
family] may reside in the unit (except for a foster child or live-in
aide as provided in paragraph (h)(4) of this section).
PART 983--SECTION 8 PROJECT-BASED CERTIFICATE PROGRAM
16. The authority citation for part 983 continues to read as
follows:
Authority: 42 U.S.C. 1437f and 3535(d).
Sec. 983.203 [Amended]
17. In Sec. 983.203(a)(5), the word ``Has'' is removed and the word
``HAs'' is added in its place.
Dated: May 10, 1996.
Michael B. Janis,
General Deputy Assistant Secretary for Public and Indian Housing.
[FR Doc. 96-13240 Filed 5-29-96; 8:45 am]
BILLING CODE 4210-33-P
Complete official Federal Register PDF
FR Doc. 96-13210 Glacier Bay National Park, Alaska: Vessel Management Plan Regulations
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27008-27019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13210]
=======================================================================
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DEPARTMENT OF THE INTERIOR
National Park Service
36 CFR Part 13
RIN 1024-AC05
Glacier Bay National Park, Alaska: Vessel Management Plan
Regulations
AGENCY: National Park Service, Interior.
ACTION: Final rule.
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SUMMARY: The National Park Service (NPS) is revising the regulations,
including vessel quotas, that were established to protect the
endangered humpback whale and other resources within Glacier Bay
National Park and Preserve. The regulations authorize a modest increase
in cruise ship, charter boat and private boat use, to be offset by
specific mitigation measures. The regulations do not authorize an
increase in the maximum number of motor vessels permitted to use the
bay on any given day.
Subject to the existing maximum daily limit of two cruise ships per
day, the regulations authorize an immediate 30-percent increase in
cruise ship traffic during the 1996 and 1997 summer seasons (June 1
through August 31). Additionally, but contingent upon the completion of
studies demonstrating that a further increase in cruise ship traffic
would be consistent with protection of the values and purposes of
Glacier Bay National Park and Preserve, the regulations could allow up
to an additional 42-percent increase (i.e., a total increase of 72%
from existing 1995 levels) in cruise ship traffic beginning with the
1998 summer season. For each summer season thereafter, the regulations
authorize the NPS to adjust the number of cruise ship entries, subject
to the maximum daily limit of two vessels, based on available
scientific and other information and applicable authorities. NPS has
also revised current restrictions on seasonal entries and use-days for
charter and private boats to authorize an 8-percent increase in charter
boat traffic and a 15 percent increase in private boat traffic
beginning with the 1996 summer season.
The regulations also extend and codify park compendium vessel
regulations for the protection of park resource values. Several
additional measures, such as the requirement for air, water and
underwater noise pollution minimization plans from cruise ships,
mitigate the potential resource impacts associated with the increase in
vessel traffic. Finally, to protect park resource values and maintain
opportunities for the safe use of kayaks, the regulations close six
specified areas to motor vessels for varying periods.
EFFECTIVE DATE: This rule is effective on May 30, 1996.
FOR FURTHER INFORMATION CONTACT: Russ Wilson, Alaska Desk Officer,
National Park Service, P.O. Box 37127, Washington, D.C. 20013-7127.
Telephone 202-208-4874.
SUPPLEMENTARY INFORMATION:
Public Participation on the Proposed Rule
The National Park Service published proposed rules as well as a
Notice of Availability of the Vessel Management Plan/Environmental
Assessment (VMP/EA) on June 5, 1995 (60 FR 29523). The 60 day period
for public comment closed on August 4, 1995, but was subsequently
reopened from August 10, 1995 (60 FR 40798), until August 25, 1995, to
accommodate several commenters who had requested an
[[Page 27009]]
extension. NPS received 427 timely comments. NPS held six open houses/
public hearings on the VMP/EA and proposed regulations in Anchorage,
Juneau, Gustavus, Hoonah, Pelican, and Elfin Cove. All meetings were
taped and transcriptions of the tapes and written comments accepted at
the hearings have been placed in the park file. The National Park
Service has carefully considered each of these comments and has adopted
several suggestions made by the commenters. Below is a summary of the
comments and NPS's responses.
Summary of Comments and Decision
The NPS requested comments on the six alternatives considered in
the VMP/EA. The alternatives included an array of vessel management
options and provided varying levels of protection for sensitive
resources.
Alternative 1 (no action) would not change existing vessel
management. Vessel management would continue in accordance with
existing regulations and the park compendium.
Alternative 2 would maintain existing levels of vessel entries
for cruise ships, tour boats, and charter and private boats into
Glacier Bay, while maximizing wilderness recreation opportunities
through the seasonal closure of five designated wilderness waters to
motor vessels.
Alternative 3 would increase seasonal vessel entry quotas for
cruise ships by 30 percent, for charter boats by 8 percent and use
days for private boats by 34 percent. Tour boat quotas would not
change. The seasonal closure of five designated wilderness waters to
motor vessels would enhance wilderness recreation opportunities.
Alternative 4 would optimize resource protection and wilderness
recreation in Glacier Bay. Seasonal vessel entries would be reduced
for cruise ships (-14%), tour boats (-22%), charter boats (-17%),
and private boats (-17%). The seasonal closure of five designated
wilderness waters to motor vessels would enhance wilderness
recreation opportunities.
Alternative 5 (original proposed action) would optimize visitor-
use opportunities in Glacier Bay by raising seasonal cruise ship
entry quotas by 72 percent; the daily limit of two ships per day
would continue. Daily limits of three tour boats, six charter boats
and 25 private boats would continue. Seasonal entries and use-days
for tour boats, charter boats, and private boats would not change
from existing levels. In the preamble to the proposed regulations,
however, the NPS also solicited comments on including an 8 percent
increase in seasonal entries and use-days for charter vessels and a
15 percent increase in seasonal entries and use-days for private
vessels. The seasonal closure of five designated wilderness waters
to motor vessels would enhance wilderness recreation opportunities.
Alternative 6 would provide additional opportunities for
motorized recreation. Seasonal vessel entries would be increased for
cruise ships (72%), charter boats (8%) and private boats (15%). Tour
boat seasonal use-days would not change. The seasonal closure of
five designated wilderness waters to motor vessels would enhance
wilderness recreation opportunities.
The majority of commenters (about 85%) were opposed to Alternative
5, which included a 72-percent increase in cruise ship entries.
Commenters were concerned that air quality, water quality, biological
resources and visitor experience would be compromised by cruise ship
increases. The majority of commenters (about 85%) favored Alternative
4, which proposed increased resource protection, additional wilderness
recreation and decreased vessel entries. The majority of commenters
(about 90%) wrote to support the proposed vessel closures or other
proposed mitigation measures.
Based on public comment received on the VMP/EA and the accompanying
regulations, the NPS has modified Alternative 5's (the proposed action)
vessel quotas, vessel operating requirements and special-use area
closures and restrictions. The modified action responds to the public's
concern for the Glacier Bay environment and a more appropriate balance
of vessel use by reducing the proposed cruise ship quota increase,
while accommodating additional opportunities for visitor use of the
park. The modified alternative includes modest increases for private
and charter vessels, providing additional opportunities for visitor use
of the park and the different types of visitor experiences that these
vessels provide. Because most charter vessels are locally based, the
increase in charter vessel use will also provide direct economic
benefits to local communities.
Under the modified alternative, in 1996, seasonal entry quotas for
cruise ships will increase by 30 percent; however, the daily limit of
two ships per day will continue. On or before October 1, 1997, the
superintendent of Glacier Bay National Park and Preserve is required to
determine, with the approval of the NPS director, whether studies have
been completed and sufficient scientific and other information have
been developed to support an increase in cruise ship entries for the
1998 summer season (June 1 through August 31). This determination
requires a finding that any seasonal increase in cruise ship entries
would be consistent with protection of the values and purposes of
Glacier Bay National Park and Preserve. Any increase would remain
subject to the maximum daily limit of two vessels. NPS would publish a
determination to increase cruise ship entries in the Federal Register,
with an opportunity for public comment. By October 1 of 1998, and of
each year thereafter, the superintendent must determine, with the
approval of the director, the appropriate number of cruise ship entries
for the following summer season (June 1 through August 31), based on
available scientific and other information and applicable authorities
and subject to the maximum daily limit of two vessels. NPS would
publish any determination to revise cruise ship entries (either to
increase or decrease) in the Federal Register, with an opportunity for
public comment.
The daily limit of three tour boats per day will not change. Daily
limits of six charter boats and 25 private boats will continue. The NPS
is modifying current restrictions on seasonal entries and use-days for
charter and private boats to provide an 8-percent increase in seasonal
entries and use-days for charter boats and a 15-percent increase in
seasonal entries and use-days for private vessels. However, NPS
recognizes that, because of the maneuverability of these smaller
vessels and the challenge of achieving compliance with protective
regulations, the increase in traffic from these vessels could result in
impacts to park resources. Consequently, the private and charter vessel
increases are authorized contingent upon the continued success of
mitigation measures such as an educational orientation program for
small vessel operators, favorable results from the compliance
monitoring program, continued research on potential impacts to park
resources, and--fundamental to all these measures--adequate resources
for implementation. NPS intends to evaluate the small vessel programs
annually.
Vessel operating requirements and the special-use area closures and
restrictions included with this alternative will provide additional
protection for sensitive resource values and increase the range and
quality of visitor experience opportunities. The modified proposed
action includes mitigating measures to further reduce the magnitude of
effects of vessel and visitor use. These include an orientation/
educational program; air, water, and underwater noise pollution control
strategies; and an expanded park research, inventory and monitoring
program. This combination of measures will facilitate monitoring and
mitigate potential environmental effects resulting from increased
vessel quotas.
[[Page 27010]]
Analysis of Comments
Research
All comments received that pertain to research stressed the need
for additional research and monitoring of vessel traffic impacts to
Glacier Bay. Several of these comments suggested that the study area
include adjacent Icy Strait waters.
The NPS is formulating a comprehensive research, inventory and
monitoring plan to assess the effects of vessel traffic on the values
and purposes of Glacier Bay National Park and Preserve. The park's
research, inventory and monitoring program will focus on obtaining
baseline information on the coastal resources and physical
characteristics of Glacier Bay; identifying and understanding the
effects of vessel traffic on air quality, marine mammals, birds,
visitor-use enjoyment and the economy of the region; and determining
whether management strategies and mitigation measures are effectively
protecting park purposes and values.
Beginning in 1996, NPS will expand research emphases. In addition
to ongoing humpback whale and harbor seal monitoring, NPS studies will
focus on behavioral changes of marine mammals in relation to vessels,
and the relationship between critical prey species and marine mammal
and bird populations and distribution. NPS will also develop protocols
for monitoring vessel traffic distribution. These studies may encompass
areas beyond the boundaries of the park, including Icy Strait waters,
in cooperation with state and federal agencies. NPS management policy
directs that parks having migratory species will ensure the
preservation of their populations and their habitats inside the park
and will cooperate whenever possible with others to ensure the
preservation of their habitats outside the park. Management actions may
include monitoring of those species outside the park to develop data
for other agencies, such as the U.S. Fish and Wildlife Service and
National Marine Fisheries Service. See, Management Policies, U.S.
Department of the Interior, National Park Service, Chapter 4:7,
Management of Migratory Animals (1988).
Research will also emphasize the use of new technologies to monitor
underwater noise and air pollution emissions in partnership with other
agencies, non-profit environmental organizations, universities and
possibly the military. This type of research direction has cruise ship
and tour boat operator support.
In addition to expanding studies in 1996, NPS will develop a
research, inventory and monitoring program for the park within one
year. It will stipulate research and protection actions NPS will
undertake to ensure that environmental effects do not exceed acceptable
levels. This program will enhance the scientific basis for future
adjustments in vessel quotas. NPS will make an annual report, detailing
efforts, funding levels and personnel allocated to VMP actions
available to the public.
One commenter noted that, in implementing the VMP requirement that
cruise ships assess the short and long-term impacts of their activities
on Glacier Bay resources through a research and monitoring program, it
would be inappropriate for each cruise ship to assess the impact of
only its activities, as a single cruise ship may be able to conclude
that the impacts of its specific operation were negligible even though
cumulative impacts may not be. Additionally, if each cruise ship
performs its own assessment, NPS could well receive inconsistent
studies based on different methodologies and assumptions. The final
rule clarifies that, as the commenter suggested, these assessments will
be performed pursuant to a comprehensive NPS research, inventory and
monitoring plan. Several commenters expressed concern that motor vessel
closures would disrupt or hamper research. However, NPS can allow
approved research activities pursuant to the administrative exception
contained in the regulations.
Humpback Whales and Whale Waters
Numerous commenters suggested that all five areas proposed as whale
waters in Alternative 3 should receive that designation to provide
maximum protection for whales in these key habitats. On the other hand,
a few commenters thought NPS should impose whale water restrictions
only when whales are present because the restrictions are a hardship on
motor vessel users. One commenter objected that the proposed
regulations would not retain the requirement that NPS consult with
other federal and state agencies and the public before designating
whale waters in Glacier Bay.
The final regulations designate four of the five areas considered
for designation as seasonal whale waters on a permanent basis. The
final regulations also allow the superintendent to designate any area
of Glacier Bay as temporary whale waters if whales concentrate in that
area. Whale waters restrictions that limit vessels to one mile from
shore or mid-channel will become effective for lower bay waters on May
15, as proposed. This is two weeks earlier than currently imposed.
Implementing a mid-channel course earlier in the spring leaves near-
shore habitat unoccupied by boats so that whales may move into the park
through the narrow mouth of the bay with less disturbance. However, the
NPS believes that imposing a speed limit automatically in mid-May, a
measure which was more objectionable to boater/commenters than was the
mid-channel (one mile from shore) requirement, could result in a loss
of credibility and, therefore, reduced compliance if boaters do not see
whales in the area. The NPS believes that the public will be better
served if these speed restrictions can be imposed promptly when they
are needed, and lifted when they are not. This approach requires that
the superintendent have the flexibility to act quickly, as this
rulemaking provides.
One commenter expressed concern that expanding whale waters, along
with the mid-channel and one-mile-from-shore restriction for vessels,
would preclude people from seeing wildlife along the shorelines. The
NPS acknowledges that, while in whale waters, the regulations would
prohibit a vessel within a mile from shore from motoring parallel to
the shore. However, motor vessels may travel perpendicularly (by the
most direct line) to shore through whale waters to view or photograph
wildlife (other than whales) or land on an otherwise unrestricted shore
to camp or participate in any other park activity.
Seals
One comment suggested closing Johns Hopkins Inlet during seal
pupping from an imaginary line from Jaw Point to Topeka Glacier and
south. The NPS has adopted a line running due west from Jaw Point that
closes virtually the same area and still provides a view of Johns
Hopkins Glacier. Additionally, Johns Hopkins Inlet (south of the line
running due west of Jaw Point) will remain closed to cruise ships from
July 1 through August 31, to protect significant concentrations of
molting harbor seals from disturbance by the increase in cruise ship
traffic.
Sea Birds
In response to comments, including one from the U.S. Fish and
Wildlife Service (FWS) that direct observations by FWS biologists at
Glacier Bay and elsewhere indicate that a 100-foot closed area around
seabird nesting colonies is inadequate to prevent disturbance to birds
at nesting colonies, NPS has instead adopted a 100-yard closure, except
at the southern one-half of South Marble Island where a 50-yard closure
will apply.
[[Page 27011]]
Many visitors on tour boats in Glacier Bay National Park consider
viewing birds at the South Marble Island a highlight of their trip.
This bird viewing has caused no apparent changes in the bird population
on this island. The excitement people feel on seeing a puffin,
kittiwake, or pigeon guillemot can, however, change the way they feel
about birds and the places where they can be found. This change can
translate into conservation and resource protection for parks where
similar wildlife exists. Prior to 1991, there was no restriction on
approaching the South Marble Island birds; subsequently, NPS
established a 100-foot distance. There have been no apparent changes to
the bird population on this island. With this rulemaking, NPS is
establishing a 50-yard distance for South Marble Island to provide the
birds additional protection but still accommodate the visitor's ability
to view the birds.
Air Quality
Most of the comments received concerning air quality expressed
concern that the NPS was not doing enough to ensure good air quality at
Glacier Bay. In order to protect the air quality of Glacier Bay
National Park and Preserve, the NPS has taken four significant steps:
(1) the NPS has adopted marine vessel visible emission standards; (2)
the NPS will require every cruise ship to prepare and abide by an NPS-
approved pollution minimization plan to assure that, to the fullest
extent possible, cruise ship companies permitted to travel within the
park apply the industry's best approaches toward pollution
minimization; (3) the NPS will consider a cruise ship company's
demonstrated ability to minimize pollution as a strongly weighted
preference for entry permits subject to competitive allocation; and (4)
the NPS has dropped a competitive preference that favored a cruise ship
company whose route of travel included both the Tarr Inlet and Johns
Hopkins Inlet. With regard to this last step, only a Tarr Inlet stop
will receive preference, thereby ensuring that park visitors aboard the
ship have an opportunity to see superlative sights in Glacier Bay
without the ship's slowing down and turning an additional time, a
maneuver that tends to increase stack emissions and concentrate them in
one area. The NPS will increase its efforts to monitor and study air
quality as part of its comprehensive research program and will amend
the standards if amendments are required to protect the values and
purposes of Glacier Bay National Park and Preserve.
One commenter pointed out that just prior to the publication of the
proposed regulations, the State of Alaska revised its air quality
regulations by relaxing the opacity standards for vessels in ports.
Since neither the state nor the NPS considers Glacier Bay a ``port,''
the regulations which the NPS adopts today are substantially the same
as current state regulations applicable to Glacier Bay. If the State of
Alaska adopts more restrictive (i.e., protective of park environmental
values) laws and regulations concerning visible emissions, NPS will
incorporate such provisions in these regulations.
Water Pollution Control Strategies
In response to comments, NPS will implement pollution control
strategies to mitigate the increase in vessel traffic with the
additional resource protection requirement that cruise ships develop
oil spill vessel response plans (VRP). Cruise ship operators must
submit VRP for review and approval prior to conducting operations in
Glacier Bay National Park. The VRP must meet planning and response
standards similar to those identified in U.S. Coast Guard regulations
for tank ships (33 CFR Part 155). The VRP will in part develop
alternate response strategies for most probable and worst case spill
scenarios, and will identify personnel, equipment and other spill
response resources that can be timely deployed in response to a spill
event. Recent cruise ship groundings in Alaska that resulted in oil
spills have highlighted the need for advance planning and preparation,
particularly since there is no pollution response contractor in
Southeast Alaska that can provide a reasonably timely response to a
spill event. The NPS will work with the cruise ship industry to develop
VRPs that protect park resources while providing flexibility to the
industry to meet established planning and response standards and
criteria.
Underwater Noise Reduction
To mitigate the effects of underwater noise in Glacier Bay, the NPS
will require every cruise ship to prepare and abide by an NPS-approved
underwater noise pollution minimization plan. The NPS will also
consider a cruise ship company's demonstrated ability to minimize
underwater noise pollution as a strongly weighted preference for entry
permits subject to competitive allocation. Several cruise ship industry
commenters were critical of the NPS proposal that competitively
allocates entry permits, granting a preference to vessels that can
demonstrate minimization of air and underwater noise pollution. These
commenters questioned whether a sufficient scientific link exists, for
example, between underwater noise and humpback whales or other marine
mammals. They also questioned the ability of the industry to respond
where there are no established standards. However, another commenter
suggested that NPS should use competitive allocation of entry permits
to challenge companies to devise effective strategies to minimize their
impacts.
Ensuring air and water quality in national parks is fundamental to
the congressionally mandated mission of the NPS to conserve scenery,
natural objects and wildlife ``unimpaired.'' Air quality studies of
cruise ships in Glacier Bay demonstrate an obvious air pollution
impact. See, Vequist, Frequency of Cruise Ship Stack Emissions in
Glacier Bay (NPS VMP/EA p. 3-22). The NPS also believes that studies
have established a sufficient scientific connection concerning vessel
noise and changes in whale behavior to warrant a preference for quiet-
running ships. See, NMFS Biological Opinion, February 19, 1993 (NPS
VMP/EA Appendix D, p. 10-12). For the most part, NPS has established a
goal and left industry the flexibility and incentive to figure out the
best and most economic way to achieve it.
Cruise Ship, Tour Vessel and Charter Vessel Definitions
The regulations amend the existing definition, which is based
solely on the United States System of classification (100 gross tons,
U.S. System), by adopting an additional definition of vessel categories
which references the International Convention System. United States
(U.S.)-flagged vessels are classified under the U.S. System, foreign-
flagged vessels under the International Convention System. Since all of
the cruise ships and some of the tour boats operating in Glacier Bay
National Park are foreign-flagged vessels, the regulations will now
reference both tonnage systems in the definitions. Although the
different systems are not directly comparable, NPS intends the two
measures in the definition to be roughly equivalent and to maintain the
status quo.
One cruise ship company asked that the 2,000 gross tons (GT)
threshold tonnage (International Convention System) demarcating the
line between tour vessels and cruise ships be raised to 20,000 GT. This
recommendation, however, would substantially change the current
demarcation between cruise ships and tour vessels and consequently
allow substantial increases in the size of
[[Page 27012]]
tour vessels. The potential environmental consequences of this change
have not been studied. More information on certain environmental
impacts may become available in the future, as a result of recently
initiated vessel acoustics studies with Cornell University and similar
research which the park hopes to undertake with the U.S. Navy. Until
then, the NPS believes that the 2,000 GT limit (International
Convention System) should not be increased until there are specific
findings, based on research, monitoring and other relevant information,
that adverse consequences would not result.
In response to a comment, NPS has modified the definition of
``charter vessel'' slightly to allow use of a charter vessel to provide
scheduled kayak and camper drop-off and pick-up service. Due in part to
size, and in part to keeping continuity in tour presentations, tour
vessels can only provide ferry service to a limited number of
locations. By allowing charter vessels to augment this service, the NPS
hopes to better disperse kayak and shore-based recreational impacts.
In response to another comment, NPS has modified the definition of
``tour vessel'' in the proposed regulation to remain similar to the
existing regulations, with respect to including smaller vessels
operating on a regularly scheduled route. Omission of this portion of
the existing regulations from the proposed regulation was an error.
Continued omission would have the unintended effect of excluding tour
vessels operating under current NPS concession permits. The NPS will
continue to determine that a proposed visitor service is both necessary
and appropriate prior to permitting any smaller vessel as a tour boat.
Cruise Ship Entries
Public comment was overwhelmingly (approximately 90 percent)
opposed to an immediate 72-percent increase in cruise ship traffic. As
one commenter noted, a modest increase in cruise ship traffic is more
consistent with the 1993 NMFS Biological Opinion, which urges the NPS
to take a conservative approach in vessel increases. This rulemaking
adopts such an approach. The several mitigation measures--including
air, water and underwater noise pollution mitigation plans; closures of
areas to motorized use; increased efforts to educate the visiting
public and increased enforcement actions; plus the commitment to a
focused research plan for the bay--should help protect against
potential impacts of the vessel increases. The NPS is additionally
mindful of its obligation to reduce entries should the additional
traffic affect humpback whales, Steller sea lions, other wildlife, or
any other values or purposes of Glacier Bay National Park and Preserve.
NPS management policies concerning public use state that, although
restrictions on recreational use should be limited to the minimum
necessary to protect visitor safety and enjoyment, such restrictions
may be required--
when, in the judgment of the superintendent [a use or activity's]
occurrence, continuation, or expansion would result in the
derogation of the values or purposes for which the park was
established, interfere significantly with the enjoyment of park
resources and values by other visitors or be inconsistent with the
park's enabling legislation or proclamation.
Management Policies, U.S. Department of the Interior, National Park
Service, Chapter 8:2, Management of Recreational Use (1988).
This rulemaking requires vessels increases to be considered and
implemented incrementally, as suggested by several commenters. With
respect to the modest increases in vessel traffic authorized by this
final rule for the 1996 and 1997 summer seasons, the NPS believes that
the rule provides sufficient mitigation and other protective measures
to assure protection of Glacier Bay resources and values. However, with
respect to any future increases beginning in 1998, the NPS will examine
research, inventory and monitoring results from the planned new studies
in addition to existing scientific knowledge, and determine in the
context of applicable authorities (e.g., 16 U.S.C. 1, et seq.) whether
further increases are appropriate. In this regard, NPS Management
Policies direct that to the extent practicable, NPS should base its
public use limits on the results of scientific research and other
available support data. When, as here, that use has the potential to
impact park purposes and values, including a threatened species and an
endangered species--and virtually all conceivable mitigation measures
have been implemented--a finding to expand a public use would require
specific findings of no adverse impact to those resources based on
research, inventory, monitoring, and other relevant information. If
circumstances arise where scientific and other information is lacking,
ambiguous, or inconclusive, the superintendent must err on the side of
protecting resources. This rulemaking ensures that the NPS has the
discretion to adjust cruise ship entries should an adjustment be
advisable or required to protect the park's resources and values.
Several commenters noted that additional entries into Glacier Bay
may lead to cruise ship companies dropping other Alaska ports from
their schedule to the detriment of the economy in those communities.
The NPS acknowledges that there may be some schedule changes; however,
by adopting a more modest increase in entries at the present time and
allowing for potential incremental increases later, disruption should
be minimal as the industry and ports adjust.
A number of commenters also noted critically that cruise ships are
generally foreign-built, foreign-owned, foreign-flagged vessels, and
employ mostly foreign crew. Although this observation is true, the NPS
has focused this rule on its statutory mission, i.e., assuring
protection of park resources and values and providing for their
enjoyment so as to ``leave them unimpaired for the enjoyment of future
generations.'' 16 U.S.C. 1.
Other comments suggested that the cruise ship evaluation process
should include not only environmental criteria, but criteria concerning
whether people are traveling on a ship for reasons that relate to the
park (as opposed to other unrelated activities). In the process of
competitively awarding cruise ship entries, the NPS has and will
continue to consider the extent to which a company's cruise itinerary
and on-board passenger activities focus on park purposes.
One commenter wrote to suggest that the park should recover more
substantial fees from cruise ship companies. Under present law, the
franchise fees collected from concessionaires at national parks
generally go to the U.S. Treasury. The NPS supports legislative
proposals pending before Congress that would direct increased
concessionaire and admission fee revenues directly to the parks for
investment in their long-term care.
Tour, Charter and Private Vessel Entries
Commenters' suggestions ranged from calls for no additional entries
in these categories to calls for increases. Over the last three summer
seasons, Glacier Bay park staff have had to turn away an increasing
number of private boaters, with the trend expected to continue. The
final rule establishes a 15-percent increase in private vessel seasonal
entries and use-days which will accommodate more visitor-use
opportunities in early June and late August, periods when the daily-use
limit of 25 private vessels has not been filled in the past. The final
rule also establishes a modest increase in charter vessel seasonal
entries and use-days (8-percent). This action improves visitor
[[Page 27013]]
opportunities for this type of park experience, and at the same time
tends to benefit the economies of local communities. As with other
vessel categories the final rule does not increase the daily limit of
charter vessels permitted in Glacier Bay (i.e., six per day). The
regulations that NPS published as part of the proposed rule included
the respective 8- and 15-percent increases in seasonal entries and use-
days. Therefore, this final rule retains the seasonal entry and use-day
increases in charter and private vessels, as published in the proposed
rule.
Tour boat companies, in particular, suggested that tour boats
should receive more entries. Several suggested that some of the entries
that NPS proposed for cruise ships should instead go to tour boats. NPS
believes that increased opportunities for people to visit the bay can
best be provided by modest increases in entries and use-days within the
existing vessel-per-day limits. Generally, the increased traffic will
occur on the shoulder seasons, not in mid-summer. Tour boats are
currently operating at the maximum allowed number of three vessels per
day during the summer season.
Commercial Fishing Vessels
Commenters were divided on the issue of how and whether commercial
fishing vessels should be managed in Glacier Bay. NPS published
proposed regulations concerning commercial fishing in Glacier Bay
National Park on August 5, 1991 (50 FR 37202). NPS is reviewing the
larger issue of the future of commercial fishing within Glacier Bay
National Park in a separate effort that may result in additional
regulations. The seasonal motor vessel closures included within today's
rulemaking will apply to commercial fishing vessels, as well as all
other types of motorized vessels and seaplanes. However, this rule
continues the exemption that commercial fishing vessels actually
engaged in commercial fishing have from the seasonal entry and daily
use limits that apply to other vessel types.
Kayaks
Comments ranged from increasing kayak use to limiting it. Some
commenters felt that NPS needs more data on kayak use, so that resource
impacts from associated uses such as on-shore camping could receive
more detailed consideration in the VMP/EA. NPS is establishing a
backcountry monitoring program to establish levels of use and assess
impacts. NPS will also continue to restrict camping in certain
shoreline areas as necessary to limit camper impacts on bears and other
resources. One commenter suggested that safety concerns based on the
potential impacts of vessel wakes on kayaks had been exaggerated. For
several reasons, however, NPS believes that the safety concerns are
real, particularly in the cold and remote waters of Glacier Bay. One
commenter suggested that NPS should require kayakers visiting Glacier
Bay to attend an educational program on the use of the bay. NPS
currently provides a kayaker/camper orientation program, which NPS
plans to continue, improve, and perhaps make mandatory at some future
date if such a requirement can reduce resource impacts and improve
visitor safety.
Concession Boats
One commenter suggested that NPS should not allocate entry permits
to charter vessels based in Bartlett Cove that operate sport fishing
charters in Icy Strait waters outside the park; rather this commenter
thought that such vessels should be encouraged to operate out of
Gustavus. NPS believes that this comment has merit. To ensure that
Bartlett Cove serves as a base for in-park activities (and not as a
base for out-of-park sport fishing), NPS will assess vessels that exit
the bay an additional entry upon return. Additionally, NPS will require
Bartlett Cove-based charters to submit a park-based operations plan. As
the commenter notes, out-of-park activities can better be served from
Gustavus. This serves both the park (by reducing traffic through much
of the lower bay whale waters) and the park visitor (by providing
incentive for use of limited charter entries within the park). Local
community economies may also benefit from visitors seeking charter
sport fishing opportunities out of the park.
Bareboat Charters
As commonly used, ``bareboat charter'' means chartering a vessel
without master (captain) or crew. Comments ranged from one that
suggested prohibition of bareboat charters, except by companies
registered by park management and familiar with park management
principles, to one of support for bareboat rentals. One commenter
suggested that the bareboat charters should not take permits from the
pool of permits available to private citizens wishing to enter the park
with their own boats. The NPS has reconsidered its position on bareboat
charters. Basing another commercial service in Bartlett Cove would
increase congestion at the already over-taxed facility. If the demand
exists for a bareboat operation, commercial services could be more
appropriately based out of Gustavus. NPS would require bareboat
charters wanting access to the park to acquire an entry permit (and
attend the orientation program), as would any other private boater.
NPS Boats
Several commenters wrote to suggest that NPS consider its own
vessel use when proposing to restrict private motorized vessel access.
One commenter stated that the VMP/EA did not analyze the potential
increase in government vessel operations resulting from additional
monitoring, research, resource protection and incident responses
associated with this rulemaking. NPS examined its own vessel activities
as part of the VMP/EA (see, p. 4.7-1). The NPS anticipates only a
slight increase in its own vessel traffic as a result of the modest
increase in other traffic authorized by this rulemaking. That increase
will consist primarily of naturalist transfers to and from the
additional cruise ships as the ships enter and exit the bay, and
increased research activities. Other commenters were concerned that
closures to motorized vessels, including research vessels during the
summer season, would severely handicap on-going scientific studies in
Glacier Bay. NPS may approve research activities for closed areas
pursuant to the administrative exception contained in these
regulations.
Wildlife Protection/Wilderness Waters
Generally, support for and opposition to wilderness water closures
was equally divided. Commenters sometimes supported particular closures
but not others. Specific comments concerning Dundas Bay opposed the
proposed closure. Dundas Bay will remain open to motor vessels, in part
to allow Elfin Cove residents motorized access to sheltered park
waters. In response to commenters, NPS would like to assure the public
that it has drawn virtually all of the closure boundaries to allow
access to anchorages at the mouths of the various areas. Wildlife
protection/wilderness water closures will take effect annually on May 1
(as in the proposed rule).
East Arm Waters
Generally, support for and opposition to east arm water closures to
motorized vessels was equally divided. However, some commenters from
both ``camps'' preferred a closure higher up the east arm. NPS has
adopted this modification, which allows more motor vessel access to the
east arm and its anchorages. It
[[Page 27014]]
provides kayakers with solitude, wilderness recreation and access to
tidewater glaciers without motorized vessel disturbance without having
to undertake a multi-day trip. The closure also mitigates a safety
concern associated with kayaker susceptibility to being overturned by
vessel wakes. Another comment that the NPS has adopted suggested
splitting the summer season and alternating closures in some areas.
This suggestion readily lent itself to the upper east arm: June 1
through July 15, the park will close Muir Inlet waters north of the
McBride Glacier to motor vessels and seaplane landings, and July 16
through August 31, the park will close Wachusett Inlet (except the
first anchorage) to motor vessels and seaplane landings. The
alternating motor vessel closures in the east arm will allow, both
visitors using motors and visitors seeking quiet, summertime access to
an east arm tidewater glacier and the natural resources of Muir or
Wachusett Inlets on a time sharing basis. Furthermore, alternating the
closures allows the east arm to continue to serve as a motor vessel
destination, thereby dispersing vessel use generally and reducing
vessel crowding in the west arm.
Bartlett Cove Access
Two commenters suggested alternative entry demarcation lines to the
current line at the mouth of Glacier Bay (Point Carolus-to- Point
Gustavus). The suggestions would leave access to Bartlett Cove
unrestricted. The adoption of these suggestions would result in an
unpredictable increase in vessel traffic throughout the area of the
park that attracts the highest concentration of whales, i.e., lower bay
whale waters. Therefore, NPS cannot adopt either of these suggestions.
Until additional monitoring and studies have been completed and
information has been developed on the interaction of vessels and whales
that supports specific findings of no adverse impact, NPS cannot
authorize increased access to Bartlett Cove.
Orientation Program
One commenter suggested that NPS waive the orientation program on
repeat visits. The proposed and final regulations give the
superintendent discretion to waive the program.
Other Restrictions
In response to comments, NPS has modified the superintendent's
discretionary closure authority. NPS previously determined and still
recognizes the need to provide temporary and intermittent
administrative remedies to protect whales through imposition of public-
use limits, whale-water designations, and other operating restrictions.
See, 50 FR 19880, 19881-82 (May 10, 1985). The environmentally safe
implementation and maintenance of the increased public-use levels
authorized in this rulemaking require that the superintendent have the
necessary authority to modify public use levels and establish vessel
restrictions in response to changing conditions in order to protect all
the park's resources. The final rule authorizes the superintendent to
impose such conditions separately or as permit requirements to ensure
the least possible impact to park resources, as whale and other
wildlife feeding, breeding, and molting sites shift to new areas in the
dynamic sea and landscape of the rebounding bay.
Section-by-Section Analysis
Section 13.65(b)(1) of the regulations defines various types of
vessels and other terms used in this section. The rule retains most of
the definitions without significant revision from the existing
regulations. However, there are exceptions:
The rule revises the terms ``cruise ship,'' ``charter vessel'' and
``tour vessel.'' In addition to some technical revisions, the proposed
definitions include a measurement standard based on the rules of the
International Convention on Tonnage Measurements of Ships, 1969.
Congress has provided for recognition of these rules that are generally
used to measure and certify foreign hull vessels. See, Omnibus Budget
Reconciliation Act of 1986, Title V--Maritime Programs, Part J--
Measurement of Vessels, P.L. 99-509, 100 Stat. 1919 (codified as
amended in scattered sections of 46 U.S.C.). The NPS has adopted a
definition of cruise ship that includes a vessel with an International
Tonnage Certificate at or exceeding 2,000 tons gross (that carries
passengers for hire). The rule defines a vessel with an International
Tonnage Certificate less than 2,000 tons gross (that carries passengers
for hire) as a tour vessel or a charter vessel. The rule also retains
the existing standards, based on the U.S. method for measuring vessels.
The rule modifies the term ``charter vessel'' to allow scheduled camper
or kayak drop-off and pick-up service. The rule expands the terms
``operate'' and ``operating'' to include the actual or constructive
possession of a vessel. NPS has done this to enable enforcement action
against vessels violating permit or closed-water restrictions when the
vessel is not underway at the time of the violation. The rule adopts
definitions for two new terms as a means to retain, clarify, and codify
both restricted and permitted activities that were authorized and
implemented under the existing 13.65(b)(2)(iii) whale-waters
regulations. The first, ``speed through the water,'' is analogous in
aeronautical terms to ``airspeed,'' as opposed to ``ground speed.'' NPS
has measured and enforced whale-water speed limits in this manner to
prevent collisions between vessels moving rapidly ``up-current'' and
whales or other marine mammals that are drifting ``down'' in the tidal
current. These speed limits also lower the level of underwater noise by
limiting high engine revolutions that can disrupt whale feeding
activities. The rule defines the term ``transit'' to allow vessels to
approach perpendicularly and land on an otherwise unrestricted shore
within designated whale waters in order to view or photograph wildlife
(except whales), camp or participate in any other park activity. The
rule deletes the term ``whale season'' and includes the dates on which
closures or restrictions begin and end as part of the regulation.
Section 13.65(b)(2) of the regulations authorizes a 30-percent
increase in cruise ship traffic during the 1996 and 1997 summer seasons
(June 1 through August 31). However, there would be no increase in the
maximum number of cruise ships permitted to use the bay on any given
day (two). Rather, this increase in traffic will be absorbed by
distributing the additional entries throughout the summer season.
Additionally, but contingent upon the completion of studies
demonstrating that a further increase in cruise ship traffic would be
consistent with protection of the values and purposes of Glacier Bay
National Park and Preserve, the regulations could allow up to an
additional 42-percent increase (from existing 1995 levels) in cruise
ship traffic beginning with the 1998 summer season. For each summer
season thereafter, the regulations authorize the NPS to adjust the
number of cruise ship entries, subject to the maximum daily limit of
two vessels, based on available scientific and other information and
applicable authorities. In determining whether to authorize future
increases in cruise ship entries, NPS must err on the side of
protecting park resources and values, particularly where the scientific
information is lacking, ambiguous, or inconclusive. NPS will publish
any future adjustment to cruise ship traffic within the scope of these
regulations in the ``Notice'' section of the Federal Register, with
opportunity for comment.
[[Page 27015]]
The rule revises current restrictions on seasonal entries and use-days
for charter and private boats to authorize an 8-percent increase in
charter boat traffic and a 15-percent increase in private boat traffic
beginning with the 1996 summer season.
This section also provides for reinitiation of consultation with
NMFS to ensure that the potential vessel traffic contemplated by these
regulations does not affect endangered or threatened species,
particularly in Glacier Bay National Park and Preserve. The section
also requires the director of the NPS to reduce vessel entry and use
levels if necessary to protect the values and purposes of Glacier Bay
National Park and Preserve.
Section 13.65(b)(2)(A) requires cruise ships to prepare, and abide
by, an NPS-approved air, water and underwater noise pollution
minimization plan to be permitted to enter Glacier Bay. Section
13.65(b)(2)(B) clarifies that each cruise ship company's assessment of
the impacts of its activities on Glacier Bay resources must correspond
to the NPS research, inventory and monitoring plan. Section 13.65(b)(2)
also incorporates the permit requirements of section 13.65(b)(3) of the
existing regulations, with minor modifications. Paragraph (b)(2)(i)(B)
generally requires private motor vessels entering the bay through the
mouth to stop at the Bartlett Cove Ranger Station for orientation
before proceeding up bay. Vessels that have previously visited the bay
may receive a waiver. Paragraph (b)(2)(ii)(E) requires concessioner
vessels to notify the Bartlett Cove Ranger Station within the 48 hours
prior to, or immediately upon, entry to the bay. Paragraph
(b)(2)(iii(C) allows private vessels to launch a motorized skiff or
tender after anchoring. Paragraph (b)(2)(iv) prohibits permit and
operating violations and clarifies the superintendent's authority to
revoke or deny a permit based on a violation.
Section 13.65(b)(3) of the regulations retains the existing
prohibitions on operating a vessel within one-quarter nautical mile of
a whale, and on pursuing or attempting to pursue a whale. It also
retains the superintendent's authority to designate temporary whale
waters and establish vessel use and speed restrictions. The regulations
identify, and designate as whale waters, areas in which seasonal
restrictions have applied on a recurring basis. The regulations codify
the restrictions that were implemented pursuant to section 13.65(b)(2)
of the existing regulations, i.e., mid-channel transit through these
waters, and in the case of lower bay waters, speeds not to exceed 20
knots.
As whales have been known to arrive at the mouth of Glacier Bay in
May, the 20-knot speed limit and the requirement that vessels in
transit stay one nautical mile off-shore become effective in the
designated lower bay whale waters each year on May 15. This earlier
date ensures that whales arriving at the mouth of Glacier Bay in late
spring are able to pass with minimal disturbance through the narrow
entrance to Glacier Bay to access feeding areas. When whales are
present, the superintendent will impose a 10-knot speed limit
((b)(3)(v)(A)(2)). The rule also establishes a speed restriction to
mitigate mortality and stress of breeding and molting harbor seals
resulting from large vessel wakes in the narrow confines of the Johns
Hopkins Inlet (paragraph (B)).
Seasonal closures and operating restrictions concerning the Spider
Island group and Johns Hopkins Inlet that appear in paragraphs
(b)(3)(vi) (C)-(F) will also protect the park's large concentration of
breeding harbor seals. Except for the continuing Johns Hopkins Inlet
cruise ship closure, the park has previously enforced these
restrictions as park compendium regulations. Paragraphs (b)(3)(vi) (A)-
(B) afford year-round protection to Steller sea lions and their haul-
outs, and nesting sea bird colonies are protected seasonally and
through year-round vessel landing and foot traffic closure of colonial
nesting islands. Park compendium regulations previously protected these
small islands seasonally. Continuing these restrictions year-round will
reduce impacts to vegetation that is important to nesting birds and
will otherwise protect this sensitive nesting habitat from trampling.
These closures are consistent with NMFS and FWS recommendations.
Paragraph (b)(3)(vi)(G) advises park visitors that the distances
established by this rulemaking to be maintained between visitors and
wildlife are minimum distances; 36 CFR 2.2 (wildlife protection)
requires that greater distances be maintained from wildlife if it is
likely that wildlife may be disturbed or frightened.
Seasonal water (area) closures for motor vessels protect nesting
sea birds as well as molting and feeding waterfowl (paragraphs
(b)(3)(vii)(A) (1)-(4)). These closures also protect harbor seal haul-
outs associated with pupping and molting activities (paragraph (4)).
NPS previously proposed similar closures for these areas (48 FR 14978,
April 6, 1983). That rulemaking also recognized the importance of
sheltering the unique concentrations of marine mammals and birds in
these areas from motorized disruption during the critical months of
feeding, breeding, nesting and rearing of young. With the exception of
Rendu Inlet, these areas contain, or are approached through, shallow
areas that are hazardous to navigate in motor vessels.
Paragraphs (b)(3)(vii) (B)-(C) adopt alternating motor vessel
closures for the waters of the Muir Inlet north of McBride Glacier
(June 1 through July 15) and the Wachusett Inlet (July 16 through
August 31). NPS adopts these closures to prevent detriment to park
resource values, including the opportunity for kayaking, camping, and
engaging in other backcountry use away from the noise and intrusion of
motor vessel traffic. Motor vessels can use these areas on a time-
sharing basis. As discussed above, the NPS believes that the closures
adopted in paragraphs (b)(3)(vi) and (b)(3)(vii)(A) are necessary to
protect the natural resource values of Glacier Bay; and the closures
adopted in paragraphs (b)(3)(vii) (B)-(C) are necessary to protect the
visitor experience and recreational resource values of Glacier Bay. All
closures are promulgated in accordance with ANILCA Section 1110(a) to
prevent detriment to the resource values of Glacier Bay National Park
and Preserve, including its wildlife and other natural resources as
well as its opportunities for quiet and solitude.
To provide quiet at popular anchorages, section 13.65(b)(3)(viii)
restricts generator and other non-propulsive motor use during the
evening hours of summer.
Section 13.65(b)(3)(ix) clarifies the duties, responsibilities, and
authority of the superintendent to regulate public use in response to
changing conditions.
Section 13.65(b)(4) of the regulations adopts restrictions on
marine vessel air pollution (stack) emissions.
NPS is addressing section 13.65(b)(5)-(6) of the existing
regulations, Restricted Commercial Fishing Harvest, separately (see,
proposed rules at 56 FR 37262 (August 5, 1991)); commercial fishing is
not considered as part of this rulemaking. However, the seasonal
closure of water areas to vessels ((b)(3)(vi) and (b)(3)(vii)) also
applies to commercial fishing boats.
Drafting Information
The primary authors of this rulemaking are Russel J. Wilson, Alaska
Field Office, National Park Service, and Molly N. Ross, Office of the
Assistant Secretary for Fish and Wildlife and Parks, Department of the
Interior, Washington, D.C. Glen Yankus, NPS Alaska System Support
Office, and
[[Page 27016]]
Randy King, Kevin Apgar and Mary Beth Moss, Glacier Bay National Park
and Preserve also made significant contributions.
Administrative Procedures Act
In accordance with the Administrative Procedures Act (5 U.S.C.
553(d)(3)), the NPS has determined that publishing this rule 30 days
prior to the rule becoming effective would delay effective
implementation of this plan for the rapidly approaching summer season.
This would be contrary to the public interest and the protection of
park resources. Approximately 45 days were lost during the preparation
of this plan due to the government shutdown. Wildlife protection
provisions contained in the regulations are intended to take effect on
May 1, and vessel traffic permit provisions apply as of June 1. NPS
requires some lead time in order to inform the public and handle permit
scheduling. Since NPS believes that all elements of this rule are
inextricably linked--e.g., the increases in vessel traffic must be
balanced by the environmental protections--NPS has decided to invoke
the ``good cause'' exception and make the entire rule effective upon
publication. Therefore, under the ``good cause'' exception of the
Administrative Procedures Act (5 U.S.C. 553(d)(3)), and as discussed
above, it has been determined that this rulemaking is excepted from the
30 day delay in effective date, and shall become effective on the date
published in the Federal Register.
Paperwork Reduction Act
As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
et seq.), the information collection requirements contained in this
final rule at Sec. 13.65(b)(2), have been approved by the Office of
Management and Budget and assigned clearance number 1024-0026. This
information is being collected to solicit information that is necessary
for the Superintendent to issue motor vessel permits. The public is
being asked to provide this information in order for the park to track
the number of permits issued and to whom they are issued. Should the
park need to contact the permittees, a mechanism will be in place to
allow them to do so.
Additionally, cruise ships, tour vessels and charter vessels will
be issued permits in accordance with NPS concession authorizations. To
obtain or renew an entry permit, cruise ship companies will prepare
and, after approval, implement a pollution minimization plan to assure,
to the fullest extent possible, that any ship permitted to travel
within Glacier Bay will apply the industry's best approaches toward
vessel oil-spill response planning and prevention and minimization of
air, water and underwater noise pollution while operating in Glacier
Bay. Such plan will be submitted to the superintendent, who may approve
or disapprove the plan.
The information will be used to grant administrative benefits and
there is an obligation to respond.
Compliance With Other Laws
This final rule has been reviewed under Executive Order 12866. The
Department of the Interior certifies that this document will not have a
significant economic effect on a substantial number of small entities
under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).
This regulation was subject to National Environmental Policy Act
compliance and an Environmental Assessment (EA) was completed. Based on
the information contained in the EA, a Finding of No Significant Impact
(FONSI) was determined.
List of Subjects in 36 CFR Part 13
Alaska, National parks, Reporting and recordkeeping requirements.
In consideration of the foregoing, the NPS amends 36 CFR Chapter I
as follows:
PART 13--NATIONAL PARK SYSTEM UNITS IN ALASKA
1. The authority citation for part 13 is revised to read as
follows:
Authority: 16 U.S.C. 1, 3, 462(k), 3101 et seq.; Sec. 13.65 also
issued under 16 U.S.C. 1a-2(h), 20, 1361, 1531, 3197.
Subpart C--Special Regulations--Specific Park Areas in Alaska
2. Section 13.65 is amended by revising the heading of paragraph
(b) and paragraphs (b)(1) through (b)(4) to read as follows:
Sec. 13.65 Glacier Bay National Park and Preserve.
* * * * *
(b) Resource protection and vessel management--(1) Definitions. As
used in this section:
Charter vessel means any motor vessel under 100 tons gross (U.S.
System) or 2,000 tons gross (International Convention System) that is
rated to carry up to 49 passengers, and is available for hire on an
unscheduled basis; except a charter vessel used to provide a scheduled
camper or kayak drop off service.
Commercial fishing vessel means any motor vessel conducting fishing
activities under the appropriate commercial fishing licenses as
required and defined by the State of Alaska.
Cruise ship means any motor vessel at or over 100 tons gross (U.S.
System) or 2,000 tons gross (International Convention System) carrying
passengers for hire.
Entry means each time a motor vessel passes the mouth of Glacier
Bay into the bay; each time a private vessel activates or extends a
permit; each time a motor vessel based at or launched from Bartlett
Cove leaves the dock area on the way into Glacier Bay, except a private
vessel based at Bartlett Cove that is gaining access or egress to or
from outside Glacier Bay; the first time a local private vessel uses a
day of the seven use-day permit; or each time a motor vessel is
launched from another vessel within Glacier Bay, except a motor vessel
singularly launched from a permitted motor vessel and operated only
while the permitted vessel remains at anchor, or a motor vessel
launched and operated from a permitted motor vessel while that vessel
is not under way and in accordance with a concession agreement.
Glacier Bay means all marine waters contiguous with Glacier Bay,
lying north of an imaginary line between Point Gustavus and Point
Carolus.
Motor vessel means any vessel, other than a seaplane, propelled or
capable of being propelled by machinery (including steam), whether or
not such machinery is the principal source of power, except a skiff or
tender under tow or carried on board another vessel.
Operate or Operating includes the actual or constructive possession
of a vessel or motor vessel.
Private vessel means any motor vessel used for recreation that is
not engaged in commercial transport of passengers, commercial fishing
or official government business.
Pursue means to alter the course or speed of a vessel or a seaplane
in a manner that results in retaining a vessel, or a seaplane operating
on the water, at a distance less than one-half nautical mile from a
whale.
Speed through the water means the speed that a vessel moves through
the water (which itself may be moving); as distinguished from ``speed
over the ground.''
Tour vessel means any motor vessel under 100 tons gross (U.S.
System) or 2,000 tons gross (International Convention System) that is
rated to carry more than 49 passengers, or any smaller vessel that
conducts tours or provides transportation at regularly scheduled times
along a regularly scheduled route.
[[Page 27017]]
Transit means to operate a motor vessel under power and
continuously so as to accomplish one-half nautical mile of littoral
(i.e., along the shore) travel.
Vessel includes every type or description of craft used as a means
of transportation on the water, including a buoyant device permitting
or capable of free flotation and a seaplane while operating on the
water.
Vessel use-day means any continuous period of time that a motor
vessel is in Glacier Bay between the hours of 12 midnight on one day to
12 midnight the next day.
Whale means any humpback whale (Megaptera novaeangliae).
Whale waters means any portion of Glacier Bay, designated by the
superintendent, having a high probability of whale occupancy, based
upon recent sighting and/or past patterns of occurrence.
(2) Permits. The superintendent will issue permits for private
motor vessels in accordance with this part and for cruise ships, tour
vessels, and charter vessels in accordance with National Park Service
concession authorizations and this part.
(i) Private vessel permits and conditions. Each private motor
vessel must have a permit to enter Glacier Bay June 1 through August
31.
(A) The superintendent may establish conditions regulating how
permits can be obtained, whom a vessel operator must contact when
entering or leaving Glacier Bay, designated anchorages, the maximum
length of stay in Glacier Bay, and other appropriate conditions.
(B) June 1 through August 31, upon entering Glacier Bay through the
mouth, the operator of a private motor vessel must report directly to
the Bartlett Cove Ranger Station for orientation.
(1) Failing to report as required is prohibited.
(2) The superintendent may waive this requirement before or upon
entry.
(ii) Commercial vessel permits and conditions. Each commercially
operated motor vessel must have the required permit(s) to enter Glacier
Bay.
(A) To obtain or renew an entry permit, a cruise ship company must
submit and, after approval, implement a pollution minimization plan.
The plan must ensure, to the fullest extent possible, that any ship
permitted to travel within Glacier Bay will apply the industry's best
approaches toward vessel oil-spill response planning and prevention and
minimization of air and underwater noise pollution while operating in
Glacier Bay. The superintendent will approve or disapprove the plan.
(B) Each cruise ship company must assess the impacts of its
activities on Glacier Bay resources pursuant to the NPS research,
inventory and monitoring plan as specified in the applicable concession
permit.
(C) The superintendent at any time may impose operating conditions
to prevent or mitigate air pollution, water pollution, underwater noise
pollution or other effects of cruise ship operation.
(D) The superintendent will immediately suspend the entry permit(s)
of any cruise ship that fails to submit, implement or comply with a
pollution minimization plan or additional operating condition.
(E) A commercial vessel, except a commercial fishing vessel, is
prohibited from entering Glacier Bay unless the operator notifies the
Bartlett Cove Ranger Station of the vessel's entry immediately upon
entry or within the 48 hours before entry.
(F) Off-boat activity from a commercial vessel is prohibited,
unless the superintendent allows it under conditions that the
superintendent establishes.
(iii) Exceptions from entry permit requirement. A permit is not
required to enter Glacier Bay when:
(A) A motor vessel is engaged in official business of the state or
federal government.
(B) A private motor vessel based at Bartlett Cove is transiting
between Bartlett Cove and waters outside Glacier Bay, or is operated in
Bartlett Cove in waters bounded by the public and administrative docks.
(C) A motor vessel is singularly launched from a permitted motor
vessel and operated only while the permitted motor vessel remains at
anchor, or a motor vessel is launched and operated in accordance with a
concession agreement from a permitted motor vessel while that vessel is
not underway.
(D) A commercial fishing vessel otherwise permitted under all
applicable authorities is actually engaged in commercial fishing within
Glacier Bay.
(E) The superintendent grants a vessel safe harbor at Bartlett
Cove.
(iv) Prohibitions. (A) Operating a motor vessel in Glacier Bay
without a required permit is prohibited.
(B) Violating a term or condition of a permit or an operating
condition or restriction issued or imposed pursuant to this chapter is
prohibited.
(C) The superintendent may immediately suspend or revoke a permit
or deny a future permit request as a result of a violation of a
provision of this chapter.
(v) Restrictions on vessel entry. The superintendent will allow
vessel entry in accordance with the following table:
----------------------------------------------------------------------------------------------------------------
Allowable Total
vessel Total vessel
Type of vessel use days entries use days Period covered by limitation
per day allowed allowed
----------------------------------------------------------------------------------------------------------------
Cruise ship.................................. 2 (\1\) (\1\) Year round.
Tour vessel.................................. 3 ......... ......... Year round.
Charter vessel............................... 6 312 552 June 1-Aug. 31.
Private vessel............................... 25 468 1,971 June 1-Aug. 31.
----------------------------------------------------------------------------------------------------------------
\1\ See paragraphs (b)(2)(v) (A) through (C) of this section.
(A) By October 1, 1996, the superintendent will reinitiate
consultation with the National Marine Fisheries Service (NMFS) and
request a biological opinion under section 7 of the Endangered Species
Act. The superintendent will request that NMFS assess and analyze any
effects of vessel traffic authorized by this section, on the endangered
and threatened species that occur in or use Glacier Bay National Park
and Preserve.
(1) Based on this biological opinion, applicable authority, and any
other relevant information, the director shall reduce the vessel entry
and use levels for any or all categories of vessels in this section
effective for the 1998 season or any year thereafter, if required to
assure protection of the values and purposes of Glacier Bay National
Park and Preserve.
[[Page 27018]]
(2) The director will publish a document in the Federal Register on
any revision in the number of seasonal entries and use days under this
paragraph (b)(2)(v), with an opportunity for public comment.
(B) By October 1, 1997, the superintendent will determine, with the
director's approval, whether studies have been completed and sufficient
scientific and other information has been developed to support an
increase in cruise ship entries for the 1998 summer season (June 1
through August 31) while assuring protection of the values and purposes
of Glacier Bay National Park and Preserve. Any increase will be subject
to the maximum daily limit of two vessel use-days. If the
superintendent recommends an increase, the superintendent will publish
a document of the increase in the Federal Register with an opportunity
for public comments.
(C) By October 1 of each year (beginning in 1998), the
superintendent will determine, with the director's approval, the number
of cruise ship entries for the following summer season (June 1 through
August 31). This determination will be based upon available scientific
and other information and applicable authorities. The number will be
subject to the maximum daily limit of two vessel use-days. The
superintendent will publish a document of any revision in seasonal
entries in the Federal Register with an opportunity for public comment.
(D) Nothing in this paragraph will be construed to prevent the
superintendent from taking any action at any time to assure protection
of the values and purposes of Glacier Bay National Park and Preserve.
(3) Operating restrictions. (i) Operating a vessel within one-
quarter nautical mile of a whale is prohibited, except for a commercial
fishing vessel actually trolling or setting or pulling long lines or
crab pots as otherwise authorized by the superintendent.
(ii) The operator of a vessel accidentally positioned within one-
quarter nautical mile of a whale shall immediately slow the vessel to
ten knots or less, without shifting into reverse unless impact is
likely. The operator shall then direct or maintain the vessel on as
steady a course as possible away from the whale until at least one-
quarter nautical mile of separation is established. Failure to take
such action is prohibited.
(iii) Pursuing or attempting to pursue a whale is prohibited.
(iv) Whale water restrictions. (A) May 15 through August 31, the
following Glacier Bay waters are designated as whale waters.
(1) Lower bay waters, defined as waters north of an imaginary line
drawn from Point Carolus to Point Gustavus; and south of an imaginary
line drawn from the northernmost point of Lars Island across the
northernmost point of Strawberry Island to the point where it
intersects the line that defines the Beardslee Island group, as
described in paragraph (b)(3)(vii)(A)(4) of this section, and following
that line south and west to the Bartlett Cove shore.
(2) [Reserved]
(B) June 1 through August 31, the following Glacier Bay waters are
designated as whale waters.
(1) Whidbey Passage waters, defined as waters north of an imaginary
line drawn from the northernmost point of Lars Island to the
northernmost point of Strawberry Island; west of imaginary lines drawn
from the northernmost point of Strawberry Island to the southernmost
point of Willoughby Island, the northernmost point of Willoughby Island
(proper) to the southernmost point of Francis Island, the northernmost
point of Francis Island to the southernmost point of Drake Island; and
south of the northernmost point of Drake Island to the northernmost
point of the Marble Mountain peninsula.
(2) East Arm Entrance waters, defined as waters north of an
imaginary line drawn from the southernmost point of Sebree Island to
the northernmost point of Sturgess Island, and from there to the
westernmost point of the unnamed island south of Puffin Island (that
comprises the south shore of North Sandy Cove); and south of an
imaginary line drawn from Caroline Point across the northernmost point
of Garforth Island to shore.
(3) Russell Island Passage waters, defined as waters enclosed by
imaginary lines drawn from: the easternmost point of Russell Island due
east to shore, and from the westernmost point of Russell Island due
north to shore.
(C) The superintendent may designate temporary whale waters and
impose motor vessel speed restrictions in whale waters. Maps of
temporary whale waters and notice of vessel speed restrictions imposed
pursuant to this paragraph (b)(3)(iv)(C) shall be made available to the
public at park offices at Bartlett Cove and Juneau, Alaska, and shall
be submitted to the U.S. Coast Guard for publication as a ``Notice to
Mariners.''
(D) Violation of a whale water restriction is prohibited. The
following restrictions apply in designated whale waters:
(1) Except on vessels actually fishing as otherwise authorized the
superintendent or vessels operating solely under sail, while in
transit, operators of motor vessels over 18 feet in length will in all
cases where the width of the water permits, maintain a distance of at
least one nautical mile from shore, and, in narrower areas will
navigate in mid-channel: Provided, however, that unless other
restrictions apply, operators may perpendicularly approach or land on
shore (i.e., by the most direct line to shore) through designated whale
waters.
(2) Motor vessel speed limits established by the superintendent
pursuant to paragraph (b)(3)(iv)(C) of this section.
(v) Speed restrictions. (A) May 15 through August 31, in the waters
of the lower bay as defined in paragraph (b)(3)(iv)(A)(1) of this
section, the following are prohibited:
(1) Operating a motor vessel at more than 20 knots speed through
the water; or
(2) Operating a motor vessel at more than 10 knots speed through
the water, when the superintendent has designated a maximum speed of 10
knots (due to the presence of whales).
(B) July 1 through August 31, operating a motor vessel on Johns
Hopkins Inlet south of 58 deg.54.2'N. latitude (an imaginary line
running approximately due west from Jaw Point) at more than 10 knots
speed through the water is prohibited.
(vi) Closed waters, islands and other areas. The following are
prohibited:
(A) Operating a vessel or otherwise approaching within 100 yards of
South Marble Island; or Flapjack Island; or any of the three small
unnamed islets approximately one nautical mile southeast of Flapjack
Island; or Eider Island; or Boulder Island; or Geikie Rock; or Lone
Island; or the northern three-fourths of Leland Island (north of
58 deg.39.1'N. latitude; or any of the four small unnamed islands
located approximately one nautical mile north (one island), and 1.5
nautical miles east (three islands) of the easternmost point of Russell
Island; or Graves Rocks (on the outer coast); or Cormorant Rock, or any
adjacent rock, including all of the near-shore rocks located along the
outer coast, for a distance of 1\1/2\ nautical miles, southeast from
the mouth of Lituya Bay; or the surf line along the outer coast, for a
distance of 1\1/2\ nautical miles northwest of the mouth of the glacial
river at Cape Fairweather.
(B) Operating a vessel or otherwise approaching within 100 yards of
a Steller (northern) sea lion (Eumetopias jubatus) hauled-out on land
or a rock or
[[Page 27019]]
a nesting seabird colony: Provided, however, that vessels may approach
within 50 yards of that part of South Marble Island lying south of
58 deg.38.6'N. latitude (approximately the southern one-half of South
Marble Island) to view seabirds.
(C) May 1 through August 31, operating a vessel, or otherwise
approaching within \1/4\ nautical mile of, Spider Island or any of the
four small islets lying immediately west of Spider Island.
(D) May 1 through August 31, operating a cruise ship on Johns
Hopkins Inlet waters south of 58 deg.54.2'N. latitude (an imaginary
line running approximately due west from Jaw Point).
(E) May 1 through June 30, operating a vessel or a seaplane on
Johns Hopkins Inlet waters south of 58 deg.54.2'N. latitude (an
imaginary line running approximately due west from Jaw Point).
(F) July 1 through August 31, operating a vessel or a seaplane on
Johns Hopkins Inlet waters south of 58 deg.54.2'N. latitude (an
imaginary line running approximately due west from Jaw Point), within
\1/4\ nautical mile of a seal hauled out on ice; except when safe
navigation requires, and then with due care to maintain the \1/4\
nautical mile distance from concentrations of seals.
(G) Restrictions imposed in this paragraph (b)(3)(vi) are minimum
distances. Park visitors are advised that protection of park wildlife
may require that visitors maintain greater distances from wildlife.
See, 36 CFR 2.2 (Wildlife protection).
(vii) Closed waters, motor vessels and seaplanes. (A) May 1 through
September 15, operating a motor vessel or a seaplane on the following
water is prohibited:
(1) Adams Inlet, east of 135 deg.59.2'W. longitude (an imaginary
line running approximately due north and south through the charted (5)
obstruction located approximately 2\1/4\ nautical miles east of Pt.
George).
(2) Rendu Inlet, north of the wilderness boundary at the mouth of
the inlet.
(3) Hugh Miller complex, including Scidmore Bay and Charpentier
Inlet, west of the wilderness boundary at the mouth of the Hugh Miller
Inlet.
(4) Waters within the Beardslee Island group (except the Beardslee
Entrance), that is defined by an imaginary line running due west from
shore to the easternmost point of Lester Island, then along the south
shore of Lester Island to its western end, then to the southernmost
point of Young Island, then north along the west shore and east along
the north shore of Young Island to its northernmost point, then at a
bearing of 15 deg. true to an imaginary point located one nautical mile
due east of the easternmost point of Strawberry Island, then at a
bearing of 345 deg. true to the northernmost point of Flapjack Island,
then at a bearing of 81 deg. true to the northernmost point of the
unnamed island immediately to the east of Flapjack Island, then
southeasterly to the northernmost point of the next unnamed island,
then southeasterly along the (Beartrack Cove) shore of that island to
its easternmost point, then due east to shore.
(B) June 1 through July 15, operating a motor vessel or a seaplane
on the waters of Muir Inlet north of 59 deg.02.7'N. latitude (an
imaginary line running approximately due west from the point of land on
the east shore approximately 1 nautical mile north of the McBride
Glacier) is prohibited.
(C) July 16 through August 31, operating a motor vessel or a
seaplane on the waters of Wachusett Inlet west of 136 deg.12.0'W
longitude (an imaginary line running approximately due north from the
point of land on the south shore of Wachusett Inlet approximately 2\1/
4\ nautical miles west of Rowlee Point) is prohibited.
(viii) Noise restrictions. June 1 through August 31, except on
vessels in transit or as otherwise permitted by the superintendent, the
use of generators or other non-propulsive motors (except a windless) is
prohibited from 10:00 p.m. until 6:00 a.m. in Reid Inlet, Blue Mouse
Cove and North Sandy Cove.
(ix) Other restrictions. Notwithstanding any other provision of
this part, due to the rapidly emerging and changing ecosystems of, and
for the protection of wildlife in Glacier Bay National Park and
Preserve, including but not limited to whales, seals, sea lions,
nesting birds and molting waterfowl:
(A) Pursuant to Secs. 1.5 and 1.6 of this chapter, the
superintendent may establish, designate, implement and enforce
restrictions and public use limits and terminate such restrictions and
public use limits.
(B) The public shall be notified of restrictions or public use
limits imposed under this paragraph (b)(3)(ix) and the termination or
relaxation of such, in accordance with Sec. 1.7 of this chapter, and by
submission to the U.S. Coast Guard for publication as a ``Notice to
Mariners,'' where appropriate.
(C) The superintendent shall make rules for the safe and equitable
use of Bartlett Cove waters and for park docks. The public shall be
notified of these rules by the posting of a sign or a copy of the rules
at the dock. Failure to obey a sign or posted rule is prohibited.
(x) Closed waters and islands within Glacier Bay as described in
paragraphs (b)(3) (iv) through (vii) of this section are described as
depicted on NOAA Chart #17318 GLACIER BAY (4th Ed., Mar. 6/93)
available to the public at park offices at Bartlett Cove and Juneau,
Alaska.
(xi) Paragraphs (b)(3) (i) through (iii) of this section do not
apply to a vessel being used in connection with federally permitted
whale research or monitoring; other closures and restrictions in this
paragraph (b)(3) do not apply to authorized persons conducting
emergency or law enforcement operations, research or resource
management, park administration/supply, or other necessary patrols.
(4) Marine vessel visible emission standards. Visible emissions
from a marine vessel, excluding condensed water vapor, may not result
in a reduction of visibility through the exhaust effluent of greater
than 20 percent for a period or periods aggregating more than:
(i) Three minutes in any one hour while underway, at berth, or at
anchor; or
(ii) Six minutes in any one hour during initial startup of diesel-
driven vessels; or
(iii) 12 minutes in one hour while anchoring, berthing, getting
underway or maneuvering in Bartlett Cove.
* * * * *
Dated: April 22, 1996.
George T. Frampton, Jr.,
Assistant Secretary for Fish and Wildlife and Parks.
[FR Doc. 96-13210 Filed 5-29-96; 8:45 am]
BILLING CODE 4310-70-P
Complete official Federal Register PDF
FR Doc. 96-13084 National Emission Standards for Hazardous Air Pollutants; Final Standards for Hazardous Air Pollutant Emissions From the Printing and Publishing Industry
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27132-27159]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13084]
[[Page 27131]]
_______________________________________________________________________
Part II
Environmental Protection Agency
_______________________________________________________________________
40 CFR Parts 9 and 63
Final Standards for Hazardous Air Pollutant Emissions from the Printing
and Publishing Industry; Final Rule
Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / Rules
and Regulations
[[Page 27132]]
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 9 and 63
[AD-FRL-5509-1]
RIN 2060-AD95
National Emission Standards for Hazardous Air Pollutants; Final
Standards for Hazardous Air Pollutant Emissions From the Printing and
Publishing Industry
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This action promulgates national emission standards for
hazardous air pollutants (NESHAP) under section 112 of the Clean Air
Act (CAA), as amended in 1990 for the printing and publishing industry.
The NESHAP requires existing and new major sources to control emissions
using the maximum achievable control technology (MACT) to control
hazardous air pollutants (HAP). The standards were proposed in the
Federal Register on March 14, 1995 (60 FR 13664). This Federal Register
action announces the EPA's final decisions on the rule.
The final rule includes organic HAP emission limits for publication
rotogravure, product and packaging rotogravure, and wide-web
flexographic printing. A variety of organic HAP are used as solvents
and components of inks and other materials used by printers. The HAP
emitted by the facilities covered by this final rule include xylene,
toluene, ethylbenzene, methyl ethyl ketone, methyl isobutyl ketone,
methanol, ethylene glycol, and certain glycol ethers. All of these
pollutants can cause reversible or irreversible toxic effects following
exposure. The potential toxic effects include eye, nose, throat, and
skin irritation; and damage to the heart, liver, kidneys, and blood
cells. The final rule is estimated to reduce baseline emissions of HAP
by 31 percent or 6700 megagrams per year (Mg/yr) (7400 tons per year
(tpy)).
The emissions reductions achieved by these standards, combined with
the emissions reductions achieved by similar standards, will achieve
the primary goal of the CAA, which is to ``enhance the quality of the
Nation's air resources so as to promote the public health and welfare
and productive capacity of its population''. The intent of this final
regulation is to protect the public health by requiring the maximum
degree of reduction in emissions of organic HAP from new and existing
sources, taking into consideration the cost of achieving such emission
reduction, any nonair quality, health and environmental impacts, and
energy requirements.
EFFECTIVE DATE: May 30, 1996.
ADDRESSES: Background Information Document. The background information
document (BID) for the promulgated standards may be obtained from the
U.S. Department of Commerce, National Technical Information Service,
Springfield, Virginia, 22161, telephone number (703) 487-4650. Please
refer to ``National Emission Standards for Hazardous Air Pollutants for
the Printing and Publishing Industry--Background Information for
Promulgated Standards,'' EPA-453/R-96-005b. The BID contains (1) a
summary of the changes made to the standards since proposal, and (2) a
summary of all the public comments made on the proposed standards and
the Administrator's response to the comments.
Electronic versions of the promulgation BID as well as this final
rule are available for download from the EPA's Technology Transfer
Network (TTN), a network of electronic bulletin boards developed and
operated by the Office of Air Quality Planning and Standards. The TTN
provides information and technology exchange in various areas of air
pollution control. The service is free, except for the cost of a phone
call. Dial (919) 541-5742 for data transfer of up to 14,400 bits per
second. If more information on TTN is needed, contact the systems
operator at (919) 541-5384.
Docket. Docket No. A-92-42, containing supporting information used
in developing the promulgated standards, is available for public
inspection and copying from 8 a.m. to 5:30 p.m., Monday through Friday,
at the EPA Air and Radiation Docket and Information Center, Waterside
Mall, Room M-1500, Ground Floor, 401 M Street, SW, Washington, DC
20460; telephone number (202) 260-7548, FAX (202) 260-4400. A
reasonable fee may be charged for copying.
FOR FURTHER INFORMATION CONTACT: Mr. David Salman at (919) 541-0859,
Emission Standards Division (MD-13), U. S. Environmental Protection
Agency, Research Triangle Park, North Carolina 27711.
SUPPLEMENTARY INFORMATION:
Regulated Entities
Entities potentially regulated by this action are those which have
the potential to emit HAP listed in section 112(b) of the CAA in the
following regulated categories and entities:
------------------------------------------------------------------------
Examples of regulated
Category entities
------------------------------------------------------------------------
Industry.................................. Printers, publishers, and
manufacturers of packaging,
wall and floor coverings,
house furnishings and
sanitary paper products
employing rotogravure
printing or wide-web
flexographic printing
technologies.
------------------------------------------------------------------------
This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that the EPA is now
aware could potentially be regulated by this action. Other types of
entities not listed in the table could also be regulated. To determine
whether your facility is regulated by this action, you should carefully
examine the applicability criteria in Sec. 63.820 of the rule. If you
have questions regarding the applicability of this action to a
particular entity, consult the person listed in the preceding FOR
FURTHER INFORMATION CONTACT section of this preamble.
Under section 307(b)(1) of the CAA, judicial review of NESHAP is
available only by the filing of a petition for review in the U.S. Court
of Appeals for the District of Columbia Circuit within 60 days of
today's publication of this rule. Under section 307(b)(2) of the CAA,
the requirements that are the subject of today's notice may not be
challenged later in civil or criminal proceedings brought by the EPA to
enforce these requirements.
The information presented in this preamble is organized as follows:
I. Background
A. Regulatory Background and Purpose
B. Common Sense Initiative
II. The Standards
III. Summary of Impacts
IV. Significant Changes to the Proposed Standards
A. Public Participation
B. Comments on the Proposed Standards
C. Significant Changes
D. Minor Changes
V. Administrative Requirements
A. Docket
B. Paperwork Reduction Act
C. Executive Order 12866: Administrative Designation and
Regulatory Analysis
D. Executive Order 12875
E. Regulatory Flexibility Act
F. Unfunded Mandates Act of 1995
G. Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA)
[[Page 27133]]
I. Background
A. Regulatory Background and Purpose
Section 112 of the CAA requires control of emissions of HAP to
protect public health and the environment. This final regulation will
reduce emissions of organic HAP from rotogravure and wide-web
flexographic printing operations.
In part, section 112 requires that emission standards be
promulgated for all categories of major sources of HAP, and for many
categories of small ``area'' sources. The CAA lists 189 HAP believed to
cause adverse health or environmental effects. Major sources are
defined as those that emit or have the potential to emit at least 10
tons per year of any single HAP or 25 tons per year of any combination
of HAP.
In the July 16, 1992, Federal Register (57 FR 31576), the EPA
published the initial list of categories of sources slated for
regulation. This list includes the printing and publishing category.
Emissions standards for the listed source categories are required to be
promulgated between November 1992 and November 2000.
Congress specified that each of these standards must require the
maximum reduction in emissions of HAP that the EPA determines is
achievable considering cost, non-air-quality health and environmental
impacts, and energy requirements. In essence, these MACT standards
ensure that all major sources of air toxics achieve the level of
control already being achieved by the better controlled and lower
emitting sources in each category. This approach creates a level
economic playing field, ensuring that facilities that employ cleaner
processes and good emissions controls are not disadvantaged relative to
competitors with poorer controls. At the same time, this approach
provides assurance to every citizen, in every community, that any major
source of toxic air pollution located nearby will have to effectively
control its emissions.
All U.S. publication rotogravure facilities and some product and
packaging rotogravure and wide-web flexographic printing facilities are
major sources of HAP emissions, with the potential to emit over 23 Mg/
yr (25 tpy) of organic HAP, including toluene, xylene, ethylbenzene,
methanol, methyl ethyl ketone, methyl isobutyl ketone, ethylene glycol,
and certain glycol ethers. All of these pollutants can cause reversible
or irreversible toxic effects following exposure. The potential toxic
effects include irritation of the eyes, nose, throat, and skin; and
damage to the heart, liver, kidneys, and blood cells.
The EPA recognizes that the degree of adverse effects to health
resulting from the most significant emissions identified can range from
mild to severe. The extent to which the effects could be experienced is
dependent upon the ambient concentrations and exposure time. The latter
is further influenced by source-specific characteristics such as
emission rates and local meteorological conditions. Human variability
factors, including genetics, age, pre-existing health conditions, and
lifestyle also influence the degree to which effects to health occur.
The final standards will reduce organic HAP emissions from
rotogravure and wide-web flexographic printing operations by 6,700 Mg/
yr (7,400 tpy) from a baseline level of 21,700 Mg/yr (23,900 tpy). No
small firms are at risk of closure as a result of the final standards,
and there will not be a significant economic impact on a substantial
number of small entities.
B. Common Sense Initiative
On October 17, 1994, the Administrator established the Common Sense
Initiative (CSI) Council in accordance with the Federal Advisory
Committee Act (U.S.C. App. 2, section 9(c)) requirements. The CSI
addresses six industrial sectors. The Printing CSI Subcommittee
addresses the Printing and Publishing industry.
The following are the six principles of the CSI program, as stated
in the ``Advisory Committee Charter.''
1. Regulation. Review existing regulations for opportunities to get
better environmental results at less cost. Improve new rules through
increased coordination.
2. Pollution Prevention. Actively promote pollution prevention as
the standard business practice and a central ethic of environmental
protection.
3. Recordkeeping and Reporting. Make it easier to provide, use, and
publicly disseminate relevant pollution and environmental information.
4. Compliance and Enforcement. Find innovative ways to assist
companies that seek to comply and exceed legal requirements while
consistently enforcing the law for those that do not achieve
compliance.
5. Permitting. Improve permitting so that it works more
efficiently, encourages innovation, and creates more opportunities for
public participation.
6. Environmental Technology. Give industry the incentives and
flexibility to develop innovative technologies that meet and exceed
environmental standards while cutting costs.
The Printing CSI Subcommittee met for the first time just before
the proposed rule was published. Several Subcommittee members were very
involved in the development of the proposed rule. All Subcommittee
members were made aware of the proposal and copies of the proposal were
provided to all interested Subcommittee members. Although the
Subcommittee did not choose to make review of the proposed rule one of
its projects, several Subcommittee members did submit comments on the
proposed rule. The subcommittee was provided with an update on the
final rule at its March 19, 1996 meeting.
Many aspects of the CSI principles are reflected in the final
standards. The alternatives considered in the development of this
regulation, including those alternatives selected as standards for new
and existing printing facilities, are based on process and emissions
data received from over 600 printing facilities. The EPA met with
industry and trade groups on numerous occasions to discuss these data.
In addition, printers, trade organizations, ink manufacturers, and
State and local regulatory authorities commented on draft versions of
the proposed regulation and on the proposed regulation. Two trade
organizations provided extensive comments. All comments were
considered, and a number of changes to the final rule reflect these
comments. Of major concern to industry were the opportunity to comply
through pollution prevention by using low HAP content materials, the
analytical method for HAP content determination, reliance on
formulation data for HAP and volatile matter determination, and
flexible compliance demonstration provisions that account for different
configurations of work stations and printing presses within a facility.
The regulation allows sources the flexibility to select from
various options for compliance. Sources may reduce HAP usage and
emissions through conversion to waterborne, lower HAP solvent-borne or
ultraviolet/electron beam cure materials. Alternatively, sources may
install or upgrade existing capture and control devices to meet the
proposed standard. Finally, sources have the option to comply by a
combination of lower HAP materials and capture and control. Facilities
may select the most cost-effective option based on facility specific
considerations.
The final rule allows existing facilities three years from the date
of promulgation to comply. This is the maximum amount of time allowed
under the CAA. This time frame will provide the greatest opportunity
for
[[Page 27134]]
developing and adopting low-HAP content materials, and provide
sufficient time for facilities that choose to install or upgrade
capture and control equipment.
Included in the final rule are methods for determining initial
compliance as well as monitoring, recordkeeping, and reporting
requirements. All of these components are necessary to ensure that
sources will comply with the standards both initially and over time.
However, the EPA has made every effort to simplify the requirements in
the rule. The EPA has also attempted to maintain consistency with
existing regulations.
Representatives from other interested EPA offices and programs were
included in the regulatory development process as members of the work
group. The work group reviewed and concurred with the regulation before
proposal and promulgation. Therefore, the EPA believes that the
implications to other EPA offices and programs have been adequately
considered during the development of the rule.
II. The Standards
The final rule is applicable to all existing and new rotogravure
and wide-web flexographic facilities that are major sources of HAP or
are located at plant sites that are major sources of HAP.
Publication rotogravure facilities subject to this rule must limit
emissions of organic HAP to no more than eight percent of the total
volatile matter used each month. The emission limitation may be
achieved by capture and control of at least 92 percent of organic HAP
used, by substitution of non-HAP materials for organic HAP, or by a
combination of capture and control technologies and substitution of
materials.
Product and packaging rotogravure and wide-web flexographic
printing facilities subject to this rule must limit emissions to no
more than five percent of the organic HAP applied each month, or to no
more than four percent of the mass of inks, coatings, varnishes,
adhesives, primers, solvents, reducers, thinners, and other materials
applied each month, or to no more than 20 percent of the solids applied
each month, or to an equivalent allowable mass based on the as-applied
solids contents of the materials applied each month.
Section 112(a) of the CAA defines major source as a source, or
group of sources, located within a contiguous area and under common
control that emits or has the potential to emit, considering controls,
9.1 Mg/yr (10 tpy) or more of any individual HAP or 22.7 Mg/yr (25 tpy)
or more of any combination of HAP. Area sources are stationary sources
that do not qualify as ``major.'' ``Potential to emit'' is defined in
the section 112 General Provisions (40 CFR 63.2) as ``the maximum
capacity of a stationary source to emit a pollutant under its physical
or operational design.'' Any physical or operational limitation on the
capacity of the stationary source to emit a pollutant, including air
pollution control equipment and restrictions on the hours of operation
or on the type or amount of material combusted, stored, or processed,
shall be treated as part of its design if the limitation or the effect
it would have on emissions is Federally enforceable.
The EPA notes that in recent decisions, National Mining Ass'n v.
EPA, 59 F.3d 1351 (D.C. Cir. 1995) and Chemical Manufacturers Ass'n v.
EPA, No. 89-1514, slip op. (D.C. Cir. Sept. 15, 1995), the District of
Columbia Circuit court addressed challenges related to the EPA's
requirement that a source which wishes to limit its potential to emit
must obtain a federally enforceable limit for the New Source Review and
NESHAP programs. The EPA is currently reviewing its Federal
enforceability requirements in light of these court decisions, and has
not yet decided how it will address this issue. Once the EPA has
completed its review of the Federal enforceability requirements in all
relevant programs including the NESHAP program, the EPA will make
available in a Federal Register notice its response to the court
decisions. In the interim, the EPA has issued its Interim Policy on
Enforceability of Limitations on Potential to Emit (January 22, 1996),
which summarizes how certain State-enforceable limits may be recognized
under this definition pending further rulemaking.
To determine the applicability of this rule to facilities that are
within a contiguous area of other HAP-emitting emission sources that
are not part of the source category covered by this rule, the owner or
operator must determine whether the plant site as a whole is a major
source. A formal HAP emissions inventory must be used to determine if
total potential HAP emissions from all HAP emission sources at the
plant site meet the definition of a major source. If the facility
commits to HAP usage restrictions as provided in the rule that ensure
potential HAP emissions will be below the major source cutoffs, only
simplified reporting and recordkeeping requirements apply. A facility
may also limit its potential to emit through other appropriate
mechanisms that may be available through the permitting authority.
Existing major sources may switch to area source status by
obtaining and complying with a federally enforceable limit on their
potential to emit prior to the ``compliance date'' of the regulation.
The ``compliance date'' for existing sources for this regulation is
defined as May 30, 1999. New major sources are required to comply with
the NESHAP requirements upon start-up or the promulgation date,
whichever is later. A facility that has not obtained federally
enforceable limits on its potential to emit by the compliance date, and
that has not complied with the NESHAP requirements, will be in
violation of the NESHAP. All sources that are major sources for HAP on
the compliance date or become major sources after the compliance date
are required to comply permanently with the NESHAP to ensure that the
maximum achievable reductions in toxic emissions are achieved and
maintained.
The final standards impose limits on organic HAP emissions from
rotogravure and wide-web flexographic printing. Publication rotogravure
facilities must demonstrate compliance on a monthly basis considering
all organic HAP used on publication rotogravure presses and all
affiliated equipment, including proof presses, cylinder and parts
cleaners, ink and solvent mixing and storage equipment, and solvent
recovery equipment. Facilities may comply using capture and control
equipment, substitution of non-HAP solvents for HAP, or a combination
of these methods.
Product and packaging rotogravure and wide-web flexographic
printing facilities must demonstrate compliance on a monthly basis
considering all organic HAP applied on product and packaging
rotogravure and wide-web flexographic printing presses. Certain presses
which are used primarily for coating, laminating, or printing using
other technologies than rotogravure printing and wide-web flexographic
printing may be excluded from the affected source, subject only to
simplified recordkeeping requirements. Owners or operators of such
equipment will be subject to the appropriate source category standard
when such a standard is issued.
Product and packaging rotogravure and wide-web flexographic
printers may comply through the use of capture and control equipment,
the substitution of non-HAP solvents for HAP, or a combination of these
methods. Facilities may comply on the basis of organic HAP emissions
per mass of solids applied, organic HAP emissions per mass of
[[Page 27135]]
materials applied, allowable organic HAP emissions based on the as-
applied solids content of the materials applied, or overall organic HAP
control efficiency.
III. Summary of Impacts
These standards will reduce nationwide emissions of HAP from
rotogravure and wide-web flexographic printing operations by
approximately 6700 Mg/yr (7400 tpy) in 1999 compared to the emissions
that would result in the absence of the standards. These standards will
also, to some extent, reduce volatile organic compounds (VOC) emissions
from those same operations compared to the emissions that would result
in the absence of the standards. The extent of the reduction in VOC
emissions cannot be predicted because of uncertainty over the extent to
which printers will comply through substitution of water and non-VOC
organics for organic HAP. No significant adverse secondary air, water,
solid waste, or energy impacts are anticipated from the promulgation of
these standards.
Implementation of this regulation is expected to result in
nationwide annual costs (including capital recovery) of approximately
$40 million beyond baseline. These costs include $21 million per year
for publication rotogravure printers and $19 million per year for
package and product rotogravure and wide-web flexographic printers.
These costs include capital recovery over a ten year period, operating
costs for newly installed and upgraded capture and control systems, and
costs for recordkeeping, reporting, and monitoring. Cost estimates for
publication rotogravure printers remain unchanged from the proposed
rule. Estimated costs for package and product rotogravure and wide-web
flexographic printers are $2 million less than those for the proposed
rule as a result of the facility-wide definition of affected source.
The economic impact analysis conducted before proposal showed that
the economic impacts from the proposed standards would be
insignificant. Since compliance costs and reporting and recordkeeping
burdens have been reduced in the final rule, the economic impacts of
the final rule are also insignificant.
IV. Significant Changes to the Proposed Standards
A. Public Participation
The standards were proposed and the preamble was published in the
Federal Register on March 14, 1995 (60 FR 13664). The preamble to the
proposed standards discussed the availability of the regulatory text
and proposal BID, which described the regulatory alternatives
considered and the impacts of those alternatives. Public comments were
solicited at the time of proposal, and copies of the regulatory text
and BID were distributed to interested parties. Electronic versions of
the preamble, regulation, and BID were made available to interested
parties via the TTN (see SUPPLEMENTARY INFORMATION section of this
preamble). A correction notice which addressed minor typographical
errors was published in the Federal Register on April 3, 1995 (60 FR
16920).
The preamble to the proposed standards provided the public the
opportunity to request a public hearing. However, a public hearing was
not requested. The public comment period was from March 14, 1995 to May
30, 1995. In all, 117 comment letters were received. The comments have
been carefully considered, and changes have been made to the proposed
standards when determined by the Administrator to be appropriate.
B. Comments on the Proposed Standards
Comments on the proposed standards were received from 117
commenters; the commenters were comprised of printers, ink
manufacturers, State and local air pollution control agencies, trade
organizations for printers and control equipment manufacturers, and
citizens. A detailed discussion of these comments and responses can be
found in the promulgation BID, which is referred to in the Addresses
section of this preamble. The discussion of comments and responses in
the BID serves as the basis for the revisions that have been made to
the standards between proposal and promulgation. Many of the comment
letters contained multiple comments.
C. Significant Changes
Several significant changes have been made in response to the
comments received on the proposed standards. A summary of the major
changes is presented below.
(1) Incidental Printing and Ancillary Printing Equipment
The rule affects rotogravure and wide-web flexographic printing
operations at major sources. Several commenters noted that this will
include facilities that use little or no HAP on rotogravure or wide-web
flexographic printing presses, but are major sources as a result of
activities conducted on other equipment in other source categories. In
addition, commenters noted that equipment that meets the definition of
rotogravure or wide-web flexographic printing press but conducts only a
small amount of rotogravure or wide-web flexographic printing
operations and is primarily used for coating, laminating, or printing
by other processes would have, as proposed, been subject to the
standard.
The first case above can be characterized as ``incidental
printing'' because the total work done on rotogravure and wide-web
flexographic printing presses at the facility is minimal and is
incidental to the other operations conducted at the facility. In the
second case above, the equipment can be characterized as ``ancillary
printing equipment'' because the work being done on rotogravure and
wide-web flexographic print stations is minimal in comparison to, and
ancillary to, the work being done on other work stations (i.e., coating
stations) on that equipment.
The EPA has considered control requirements for incidental printing
as a separate subgroup. Under the rule, product and packaging
rotogravure and wide-web flexographic printing affected sources that
apply no more than 500 kilograms of materials each month and that are
located at facilities that are major sources of HAP are considered
incidental printers. This definition ensures that the total work done
on product and packaging rotogravure and wide-web flexographic presses
at the facility is minimal and is incidental to the other operations
conducted at the facility.
The EPA believes it is appropriate not to subject incidental
printing operations to the requirements in Sec. 63.825 that apply to
product and packaging rotogravure and wide-web flexographic printing.
The EPA's analysis of the MACT floor for product and packaging
rotogravure and wide-web flexographic printing is based on emissions
levels and control techniques at facilities primarily engaged in
printing that generally apply more than 500 kilograms of material each
month on product and packaging rotogravure and wide-web flexographic
presses. The EPA has little information on which to establish a MACT
control level for incidental printing. The available information
indicates that the MACT floor for this subgroup is no control.
The final standard includes simplified requirements and does not
mandate emission controls for incidental printers. Affected sources
within this subgroup are those which apply no more than 500 kilograms
of material
[[Page 27136]]
each month or no more than 400 kilogams of HAP each month on product
and packaging rotogravure and wide-web flexographic presses. The 400
kilogram of HAP applied per month alternative threshold has been
included to provide affected sources applying somewhat more than 500
kilograms of material per month with the opportunity to maintain
incidental printer status if they reduce the HAP content of the
materials applied so that the monthly HAP applied is no more than would
be applied by an affected source that applied 500 kilograms of material
per month. Affected sources in this subgroup would be subject only to
initial notification requirements and recordkeeping requirements to
show that one of the thresholds is met every month.
The type of simplified requirements included in the final standard
for this subgroup of product and packaging or wide-web flexographic
sources were not made available to publication rotogravure affected
sources because each press at a publication rotogravure affected source
would far exceed the thresholds every month. A single publication
rotogravure press would, in fact, be a major source of HAP.
The final standard also permits the owner or operator of a product
and packaging rotogravure or wide-web flexographic printing affected
source to choose to exclude ancillary printing equipment from the
affected source. This equipment is used primarily for coating,
laminating, or other operations besides product and packaging
rotogravure and wide-web flexographic printing. Presses on which five
weight-percent or less of the total material applied each month is
applied by rotogravure or wide-web flexographic print stations would be
subject only to a simplified recordkeeping requirement. The EPA
believes it is appropriate to provide the owner or operator with the
option not to subject these presses to the HAP emission limitations for
product and packaging and wide-web flexographic printing in Sec. 63.825
because the work being done on the rotogravure and wide-web
flexographic print stations on these presses is ancillary to the work
being done on other work stations (i.e., coating stations) on these
presses. The EPA is separately establishing MACT for other source
categories, such as the paper and other web coating source category and
the metal coil coating source category, which may be more appropriate
for this type of equipment. Ancillary printing equipment, if excluded
from this standard, will be subject to the appropriate source category
standard when such a standard is issued.
(2) Research and Laboratory Equipment
Several comments were received requesting exemption of research and
laboratory equipment. Commenters noted that the purpose and operation
of research presses are independent of their location. One commenter
noted that research and laboratory operations could be exempted from
this standard and a separate standard for these operations could be
developed.
All research and laboratory equipment has been excluded from the
final standard whether or not it is collocated with production
facilities. In order to regulate research and laboratory equipment, it
would be necessary to develop a separate source category as directed by
section 112(c)(7) of the CAA to assure equitable treatment of such
equipment.
(3) Addition of Presses to Existing Affected Sources
Comments were received concerning triggering of new source
compliance deadlines as a result of adding new presses to existing
control systems or new stations to existing presses. Commenters noted
that this would discourage replacement and modification of presses or
stations to take advantage of low-HAP materials.
Addition of presses to existing affected sources will subject the
affected source to the compliance deadline for new sources only if the
additional press or presses constitutes a reconstruction of the source,
as defined in Sec. 63.2. Additions, replacements, and modifications to
existing sources which do not meet the definition of reconstruction do
not alter the compliance deadline.
(4) Affected Source for Product and Packaging Rotogravure and Wide-web
Flexographic Printing Facilities
Comments were received suggesting changes in the definition of
affected source at product and packaging rotogravure and wide-web
flexographic printing facilities to simplify compliance demonstration.
One commenter stated that a facility-wide definition of affected source
would significantly cut recordkeeping expenses.
In response, the final standard considers all rotogravure and wide-
web flexographic printing equipment at a given facility as a single
affected source. This grouping is more consistent with the way that the
MACT floor was determined and is consistent with other MACT standards
which have grouped various emission points into a single affected
source. It is also more consistent with the definition of affected
source for publication rotogravure.
This definition of affected source simplifies reporting and
recordkeeping in many cases. In addition, sources may achieve the
required emissions reductions by considering emissions from the entire
affected source, including controlled and uncontrolled presses. This
will allow sources to comply in the most cost-effective way and will
not require expensive control equipment for small presses which emit
relatively small amounts of organic HAP if equivalent emissions
reductions can be achieved elsewhere in the affected source.
(5) Organic HAP Analysis Methods
Ninety-six comments were received requesting that the EPA accept
formulation data in lieu of requiring the use of EPA Method 311 to
determine organic HAP content of printing materials. Formulation data
were preferred to reduce analytical cost and delays due to chemical
analysis. Some commenters also suggested various modifications to the
proposed analytical technique in the interests of improved accuracy,
consistency with apparatus presently in operation, and reduced
analytical costs.
The final standard adopts Method 311, as revised and promulgated
with the Wood Furniture Manufacturing Operations NESHAP (60 FR 62930),
for organic HAP analysis. Printers and ink manufacturers have the
option of relying on formulation data if the data meet specified
criteria. In the event of any discrepancy between formulation data and
the results of EPA Method 311, the results of EPA Method 311 shall be
presumed to govern for all compliance purposes. In addition, the
printer may determine the total volatile matter content of the material
and use this value for the organic HAP content for all compliance
purposes. This option may be chosen by printers using materials in
which all, or nearly all, of the volatile matter is organic HAP in
order to avoid the need for a more time-consuming analytic procedure.
(6) Volatile Matter Analysis Methods
Several comments were received requesting that formulation data be
acceptable instead of chemical analysis data. Commenters noted this
would greatly reduce analytical costs.
The final standard allows printers and ink manufacturers the option
of relying on formulation data for volatile matter and solids content,
in lieu of EPA Methods 24 and 24A. In the event of any
[[Page 27137]]
discrepancy between formulation data and the results of the EPA test
methods, the test methods shall be presumed to govern for all
compliance purposes.
(7) Compliance Monitoring for Catalytic Oxidizers
Nine commenters noted that the temperature downstream of a
catalytic oxidizer was inappropriate for use as a monitoring parameter
to indicate HAP destruction. The commenters noted that downstream
temperature parameters established during performance testing under
normal conditions might not be maintained during low-load conditions,
yet this would not be an indication of excess emissions.
The final standard requires owners or operators using a catalytic
oxidizer (that is, a catalytic incinerator) and monitoring an operating
parameter to ensure compliance with the standard to monitor the
temperature immediately upstream of the catalyst bed. The requirement
to monitor the temperature downstream of the catalyst bed has been
eliminated. Since the operating parameters are established during a
test under normal operating conditions, a downstream temperature
monitoring parameter might be impossible to meet during periods when
organic loading to the oxidizer was lower than normal. This might have
led to exceedances which were not indicative of improper operating
conditions or excessive emissions.
(8) Additional Compliance Options for Product and Packaging Rotogravure
and Wide-web Flexographic Printing Affected Sources
Several commenters requested clarification that compliance need
only be demonstrated by a single procedure appropriate to the source's
compliance strategy. Several commenters suggested that the rule should
provide a variety of compliance demonstration alternatives to
accomodate different aggregations of work stations and HAP control
strategies.
In order to make the compliance options consistent with facility-
wide definition of affected source, additional means of demonstrating
compliance have been added to the final rule. Facilities may
demonstrate that each material applied meets either of the organic HAP
thresholds, or that all materials on average meet either of the organic
HAP thresholds, or that the organic HAP emitted is less than the
organic HAP allowed taking these thresholds into account. In addition,
emissions from controlled and uncontrolled presses are aggregated to
determine compliance across the entire affected source.
The final rule has been expanded to include ten procedures under
which compliance can be demonstrated under different circumstances. Any
one of the ten procedures can be used. These procedures are consistent
with the proposed standards for low HAP materials and HAP emission
control device operation. These procedures encompass the range of
suggestions made by the commenters. The new compliance demonstration
procedures in the final rule are expected to have a negligible impact
on HAP emissions compared to the provisions in the proposed rule.
(9) Capture Efficiency Protocols and Test Methods
Four commenters requested that the rule allow the use of alternate
capture efficiency test protocols approved by the EPA in lieu of the
procedures specified in Sec. 52.741.
The final rule includes additional options for capture efficiency
tests. Provisions of the proposed rule pertaining to verification of
permanent total enclosures and temporary total enclosure capture
efficiency testing in accordance with Sec. 52.741 have been retained in
the final rule. The final rule also allows, as an alternative, the use
of any capture efficiency protocol and test methods which satisfy the
criteria of either the Data Quality Objective or Lower Confidence Limit
approaches. An appendix describing these approaches has been added to
the final rule. The use of these alternative approaches is optional for
the owner or operator of the affected source and the EPA has determined
that capture efficiency tests satisfying the criteria of these
alternate approaches will be sufficiently rigorous to ensure compliance
with the standard.
(10) Transition from Area Source to Major Source Status
A commenter requested that a provision allowing a transition period
for a newly designated major source to come into compliance be
incorporated in the rule. The commenter noted that the proposed rule
had no provisions for a source to make this transition without being in
violation of the standard.
A provision has been added to the final rule which provides a
mechanism for owners or operators that have used the provisions of
Sec. 63.820(a)(2) to establish the facility as an area source to
reestablish the facility as a major source. Such a source must continue
to comply with its HAP usage commitments until it meets all
requirements for major sources.
(11) Definition of ``Month''
In response to a comment, the definition of ``month'' in the final
rule has been changed to include prespecified periods of 28 to 35 days.
The revised definition will fit better with the materials accounting
systems used by some facilities and have little or no effect on the
emission reduction achieved by the standard.
(12) Alternatives to Vent Stream Flow Rate Monitoring
Seven commenters requested inclusion of alternative methods for
vent stream flow rate monitoring, substitution of flow indicators
rather than flow meters, or elimination of the flow rate monitoring
requirement. One commenter recommended that press interlocks be
permitted as an alternative to vent stream flow rate monitoring.
The final regulation includes alternatives to the vent stream flow
rate measurement requirement. These alternatives are simpler than the
requirements in the proposed rule, but still ensure that sufficient
records will be generated to show when HAP containing vent streams are
being delivered to a control device and to allow for proper calculation
of HAP emissions. Owners or operators of product and packaging
rotogravure or wide-web flexographic presses with intermittently-
controllable work stations may, as alternatives to measuring vent
stream flow rate, install flow indicators on the bypass lines, secure
bypass line valves with locking mechanisms or car seals, continuously
monitor bypass valve position, or equip the press with an interlock
preventing operation when the control device is bypassed. Sampling
lines for gas analyzers and relief valves needed for safety purposes
are not considered bypass lines for the purposes of these provisions.
Presses that do not have any intermittently-controllable work stations
are not subject to these provisions.
(13) Provisions for Inclusion of Stand-alone Coating Equipment in
Affected Source
One comment was received suggesting that off-line coaters sharing a
common control device with printing presses should be included in the
affected source at the discretion of the facility. It was noted that
such a provision would avoid penalizing facilities that had tightened
up their control systems by tying in other sources of HAP.
Provisions have been added to the final rule through which owners
or operators of affected sources may, at
[[Page 27138]]
their option, under certain conditions, include stand-alone coating
equipment in the affected source subject to this standard. This type of
coating equipment is expected to be covered by one of several MACT
standards (e.g., Paper and Other Web Coating) which are scheduled to be
promulgated in the future. Printers choosing this option may avoid the
difficulty of complying with multiple standards in the future. Stand-
alone coating equipment must meet certain requirements to be eligible
for inclusion under this provision. To be eligible, stand-alone coating
equipment must either share a control device with a press included in
the affected source, or process the same substrate as a press included
in the affected source, or apply one or more of the same solids-
containing materials as a press included in the affected source. If any
eligible equipment is included under this provision, all eligible
equipment at the facility must be included.
(14) Addition of Criteria To Determine Whether Method 25 or Method 25A
is Appropriate for Performance Testing
The proposed rule required that performance tests employ either
Method 25 or 25A, as appropriate to the conditions of the site. The
final rule has been clarified to specify the conditions based on the
required or anticipated organic volatile matter concentration at the
exhaust from the control device. These conditions are based on guidance
provided to regional offices and State programs, and clarify the
conditions under which Method 25A are appropriate. This will reduce the
administrative burden on some sources and will not reduce the
stringency of the rule.
(15) Conditions Under Which Performance Test Is To Be Conducted
One commenter recommended testing under reasonably expected
conditions and a second commenter recommended testing under normal
conditions instead of maximum conditions.
The final rule has been made consistent with the General Provisions
to require performance testing under ``normal operating conditions''
rather than ``maximum capacity.'' This will result in establishment of
more representative operating parameters and will not cause an increase
in HAP emissions.
(16) Clarification of Reporting and Recordkeeping Requirements
Several comments were received requesting clarification that only
recordkeeping and reporting applicable to the specific control strategy
employed were required. One commenter stated that area sources should
be required to submit initial notifications so that States would be
advised of their operations.
The final rule enumerates the types of excess emissions (including
operating parameter exceedences) which must be included, as applicable,
in the summary report. Recordkeeping requirements for incidental
printing, ancillary printing equipment, and optional inclusion of
stand-alone coating equipment have been added to the final rule.
The requirement for annual reporting of HAP usage by sources using
the optional provisions of this rule to establish area source status
has been eliminated from the final rule. A less burdensome requirement
that such sources submit initial notifications has been added to the
final rule. This initial notification will inform the Administrator
that a source is using these optional provisions to establish area
source status. The annual report was determined to be unnecessary
because the source is required to maintain monthly records of HAP usage
and to report any 12 month period in which the area source commitment
is not met as part of its summary report.
D. Minor Changes
This section contains a list of several of the minor changes to the
final rule.
(1) Revisions to definitions and phrasing have been made to clarify
the regulation.
(2) Variables have been redefined as necessary to avoid ambiguity,
and additional variables have been defined where necessary to
explicitly describe the additional compliance options available in the
final rule.
(3) Typographical errors have been corrected.
(4) The citation of the basis for delegation of regulatory
authority has been corrected.
(5) The summary table in the proposed rule has been eliminated.
(The General Provisions cross reference table has been retained and
additional clarifying notes have been added.)
(6) Language has been added to the final rule which clarifies that
the optional area source mechanism included in the rule does not
preclude an owner or operator from taking advantage of other mechanisms
which are available to establish area source status.
(7) A provision in the proposed rule requiring owners or operators
of affected sources to obtain part 70 or part 71 operating permits has
been eliminated from the final rule because this provision may have
been inadvertently interpreted to require these permits for sources
which used the optional provisions of the rule to establish area source
status. Such sources may be required to obtain such permits, but are
not required to obtain them as a result of using the optional provision
in this standard.
(8) The deadline for initial notification for existing sources has
been extended until one year before the compliance date.
V. Administrative Requirements
A. Docket
The Docket is an organized and complete file of all the information
considered by the EPA in the development of this rulemaking. The Docket
is a dynamic file, since material is added throughout the rulemaking
development. The docketing system is intended to allow members of the
public and industries involved to readily identify and locate documents
so that they can effectively participate in the rulemaking process. The
contents of the Docket, including the BID for the proposed and
promulgated standards and the EPA responses to significant comments,
will serve as the record in case of judicial review (see 42 U.S.C.
7607(d)(7)(A)).
B. Paperwork Reduction Act
The Office of Management and Budget (OMB) has approved the
information collection requirements contained in this rule under the
provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., and
has assigned OMB control number 2060-0335. The EPA is therefore
amending the table of currently approved information collection request
(ICR) control numbers issued by OMB for various regulations. This
amendment updates the table to accurately display those information
requirements contained in this final rule. This display of the OMB
control number and its subsequent codification in the Code of Federal
Regulations satisfies the requirements of the Paperwork Reduction Act
(44 U.S.C. 3501 et seq.) and OMB's implementing regulations at 5 CFR
part 1320.
The ICR was previously subject to public notice and comment prior
to OMB approval. As a result, the EPA finds that there is ``good
cause'' under section 553(b) of the Administrative Procedure Act (5
U.S.C. 553(b)) to amend the table in part 9 without prior notice and
comment. Due to the technical nature of the table, further notice and
comment would be unnecessary. For the same reasons, the EPA finds that
there is good cause under 5 U.S.C. 553(d)(3).
[[Page 27139]]
The information required to be collected by this rule is necessary
to identify the regulated entities who are subject to the rule and to
ensure their compliance with the rule. The recordkeeping and reporting
requirements are mandatory and are being established under authority of
section 114 of the CAA. All information submitted to the EPA for which
a claim of confidentiality is made will be safeguarded according to the
EPA policies set forth in title 40, part 2, subpart B--Confidentiality
of Business Information.
The total annual reporting and recordkeeping burden for this
collection averaged over the first three years is estimated to be
89,965 hours per year. The average burden, per respondent, is 164 hours
per year. The rule requires an initial one-time notification from each
respondent and subsequent reports/notification would have to be
submitted semiannually. Respondents operating capture systems and
control devices would also be required to submit notifications of
performance tests, performance test plans and reports of performance
tests. There would be an estimated 500 respondents to the collection
requirements. This estimate includes the time needed to review
instructions; develop, acquire, install, and utilize technology and
systems for the purposes of collecting, validating, and verifying
information, processing and maintaining information, and disclosing and
providing information; adjust the existing methods for compliance with
any previously applicable instructions and requirements; train
personnel to be able to respond to a collection of information; search
data sources; complete and review the collection of information; and
transmit or otherwise disclose the information.
Send comments on the EPA's need for this information, the accuracy
of the provided burden estimates, and any suggested methods for
minimizing respondent burden, including the use of automated collection
techniques, to the Director, OPPE Regulatory Information Division; U.S.
Environmental Protection Agency (2136), 401 M St. SW., Washington, DC
20460; and to the Office of Information and Regulatory Affairs, Office
of Management and Budget, 725 17th St. NW, Washington, DC 20503; marked
``Attention: Desk Officer for EPA.'' Include the OMB control number in
any correspondence.
C. Executive Order 12866: Administrative Designation and Regulatory
Analysis
Under Executive Order 12866 (58 FR 51735 (October 4, 1993)), the
EPA is required to judge whether a regulation is ``significant'' and
therefore subject to OMB review and the requirements of this executive
order to prepare a regulatory impact analysis (RIA). The order defines
``significant regulatory action'' as one that is likely to result in a
rule that may (1) have an annual effect on the economy of $100 million
or more, or adversely affect in a material way the economy, a sector of
the economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities, (2) create a serious inconsistency or otherwise interfere
with an action taken or planned by another agency, (3) materially alter
the budgetary impact of entitlements, grants, user fees, or loan
programs, or the rights and obligation of recipients thereof, or (4)
raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the executive
order.
Pursuant to the terms of Executive Order 12866, OMB has notified
the EPA that it considers this a ``significant regulatory action''
within the meaning of the executive order. The EPA has submitted this
action to OMB for review. Changes made in response to OMB suggestions
or recommendations will be documented in the public record.
D. Executive Order 12875
To reduce the burden of Federal regulations on States and small
governments, the President issued Executive Order 12875 on October 26,
1993, entitled Enhancing the Intergovernmental Partnership. In
particular, this executive order is designed to require agencies to
assess the effects of regulations that are not required by statute and
that create mandates upon State, local, or tribal governments. Two
methods exist for complying with the requirements of the executive
order: (1) Assure that funds necessary to pay direct costs of
compliance with a regulation are provided, or (2) provide OMB a
description of the communications and consultations with State/local/
tribal governments, the nature of their concerns, any written
submission from them, and the EPA's position supporting the need to
issue the regulation.
The EPA has always been concerned about the effect of the cost of
regulations on small entities; the EPA has consulted with and sought
input from public entities to explain costs and burdens they may incur.
The EPA advised interested parties on July 16, 1992 (57 FR 21592),
of the categories considered as major and area sources of HAP, and the
printing/publishing (surface coating) industry was listed as a category
of both major and area sources. The EPA made significant effort to hear
from all levels of interest and all segments of the rotogravure and
wide-web flexographic printing industry. To facilitate comments and
input, the EPA participated in numerous meetings with trade
organizations representing all industry sectors affected by this rule.
Throughout the regulatory development process, and more specifically,
in consultation meetings, industry representatives from printing
companies, ink manufacturers, and various trade associations were given
an opportunity to comment on the proposed regulatory approach and the
MACT alternatives being developed. The major topic areas resulting from
these discussions included industry segmentation, the determination of
the MACT floor, test methods, monitoring procedures, facility-wide
averaging, compliance deadlines, and pollution prevention.
Documentation of all meetings and public comments can be found in
Docket A-92-42.
Representatives of State and local air pollution control agencies
participated in all of the EPA work group meetings, and several State
and local agencies submitted public comments in response to the
proposed standards.
The EPA has considered the purpose and intent of Executive Order
12875 and has determined that printing and publishing NESHAP are
needed. The rule is generally required by statute under section 112 of
the CAA because printing and publishing facilities emit significant
quantities of air pollutants. Through meetings and consultations during
project development and proposal, efforts were made to inform entities
of the costs required to comply with the regulation; in addition,
modifications were made to reduce the burden to small entities.
E. Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires the
EPA to consider potential impacts of proposed regulations on small
business ``entities.'' If a preliminary analysis indicates that a
proposed regulation would have a significant economic impact on 20
percent or more of small entities, then a final Regulatory Flexibility
Analysis
[[Page 27140]]
(RFA) must be prepared. The EPA's analysis of these impacts was
summarized in the preamble to the proposed rule (60 FR 13664).
In addition, the EPA has a set of Regulatory Flexibility Guidelines
(RFG), published in April 1992, that require the EPA to conduct a final
RFA if any small business or small entity impacts occur resulting from
a rule whose Start Action Notice (SAN) is approved after the date of
publication of the EPA RFG. The SAN for this rule was approved before
that date, thus the former Regulatory Flexibility Act guidelines hold.
An RFA was conducted, however, as part of the larger economic impact
analysis whose results were presented in the preamble to the proposed
rule. The RFA prepared meets the EPA RFG as well as the original
Regulatory Flexibility Act Guidelines. It also meets the analytical
requirements of the Small Business Regulatory Enforcement Fairness Act
of 1996.
This analysis found that the proposed rule would not have a
significant economic impact on a substantial number of small entities.
No comments were received on this analysis. The changes made in the
final rule reduce the cost of achieving and demonstrating compliance
for affected small and large entities. Therefore, pursuant to the
provisions of 5 U.S.C. 605(b), I hereby certify that this rule will not
have a significant economic impact on a substantial number of small
business entities.
F. Unfunded Mandates Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub.L.
104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, the
EPA generally must prepare a written statement including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, and tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. Before promulgating an EPA rule for which a written statement
is needed, section 205 of the UMRA generally requires the EPA to
identify and consider a reasonable number of regulatory alternatives
and adopt the least costly, most cost-effective, or least burdensome
alternative that achieves the objectives of the rule. The provisions of
section 205 do not apply when they are inconsistent with applicable
law. Moreover, section 205 allows EPA to adopt an alternative other
than the least costly, most cost-effective, or least burdensome
alternative if the Administrator publishes with the final rule an
explanation why that alternative was not adopted. Before the EPA
establishes any regulatory requirements that may significantly or
uniquely affect small governments, including tribal governments, it
must have developed under section 203 of the UMRA, a small government
agency plan. The plan must provide for notifying potentially affected
small governments, enabling officials of affected small governments to
have meaningful and timely input in the development of the EPA
regulatory proposals with significant Federal intergovernmental
mandates and informing, educating, and advising small governments on
compliance with the regulatory requirements.
The EPA has determined that the action promulgated today does not
include a Federal mandate that may result in estimated costs of $100
million or more in any one year to either State, local, or tribal
governments in the aggregate, or to the private sector. Therefore, the
requirements of the UMRA do not apply to this action.
G. Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)
Pursuant to Subtitle E of SBREFA, this rule, which is nonmajor, was
submitted to Congress before publication in the Federal Register.
List of Subjects in 40 CFR parts 9 and 63
Environmental protection, Air pollution control, Hazardous
substances, Reporting and recordkeeping requirements, Standard for
printing and publishing industry.
Dated: May 15, 1996.
Carol M. Browner,
Administrator.
For reasons set out in the preamble, title 40, chapter I of the
Code of Federal Regulations is amended as follows:
PART 9--[AMENDED]
1. The authority citation for Part 9 continues to read as follows:
Authority: 7 U.S.C. 135 et seq., 136-136y; 15 U.S.C. 2001, 2003,
2005, 2006, 2601-2671; 21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33
U.S.C. 1251 et seq., 1311, 1313(d), 1314, 1318, 1321, 1326, 1330,
1342, 1344, 1345(d) and (e), 1361; E.O. 11735, 38 FR 21243, 3 CFR,
1971-1975 Comp. p. 973; 42 U.S.C. 241, 242b, 243, 246, 300f, 300g,
300g-1, 300g-2, 300g-3, 300g-4, 300g-5, 300g-6, 300j-1, 300j-2,
300j-3, 300j-4, 300j-9, 1857 et seq., 6901-6992k, 7401-7671q, 7542,
9601-9657, 11023, 11048.
2. Section 9.1 is amended by adding a new entry to the table under
the indicated heading in numerical order to read as follows:
Sec. 9.1 OMB approvals under the Paperwork Reduction Act.
* * * * *
------------------------------------------------------------------------
40 CFR citation OMB control No.
------------------------------------------------------------------------
* * * * *
National Emission Standards for Hazardous Air Pollutants for Source
Categories \13\
* * * * *
63.829-63.830............................ 2060-0335
* * * * *
------------------------------------------------------------------------
\3\ The ICRs referenced in this section of the table encompass the
applicable general provisions contained in 40 CFR part 63, subpart A,
which are not independent information collection requirements.
PART 63--[AMENDED]
1. The authority citation for part 63 continues to read as follows:
Authority: Secs. 101, 112, 114, 116, 183(f) and 301 of the CAA,
as amended (42 U.S.C. 7401, 7411, 7414, 7416, 7511b(f), 7601).
2. Part 63 is amended by adding a new subpart KK consisting of
Secs. 63.820 through 63.839 to read as follows:
Subpart KK--National Emission Standards for the Printing and Publishing
Industry
Sec.
63.820 Applicability.
63.821 Designation of affected sources.
63.822 Definitions.
63.823 Standards: General.
63.824 Standards: Publication rotogravure printing.
63.825 Standards: Product and packaging rotogravure and wide-web
flexographic printing.
63.826 Compliance dates.
63.827 Performance test methods.
63.828 Monitoring requirements.
63.829 Recordkeeping requirements.
63.830 Reporting requirements.
63.831 Delegation of Authority.
63.832--63.839 [Reserved]
Table 1 to Subpart KK--Applicability of General Provisions to Subpart
KK
Appendix A to Subpart KK--Data Quality Objective and Lower Confidence
Limit Approaches for Alternative Capture Efficiency Protocols and Test
Methods
Subpart KK--National Emission Standards for the Printing and
Publishing Industry
Sec. 63.820 Applicability.
(a) The provisions of this subpart apply to:
(1) Each new and existing facility that is a major source of
hazardous air
[[Page 27141]]
pollutants (HAP), as defined in 40 CFR 63.2, at which publication
rotogravure, product and packaging rotogravure, or wide-web
flexographic printing presses are operated, and
(2) each new and existing facility at which publication
rotogravure, product and packaging rotogravure, or wide-web
flexographic printing presses are operated for which the owner or
operator chooses to commit to, and meets the criteria of paragraphs
(a)(2)(i) and (a)(2)(ii) of this section for purposes of establishing
the facility to be an area source with respect to this subpart:
(i) Use less than 9.1 Mg (10 tons) per each rolling 12-month period
of each HAP at the facility, including materials used for source
categories or purposes other than printing and publishing, and
(ii) Use less than 22.7 Mg (25 tons) per each rolling 12-month
period of any combination of HAP at the facility, including materials
used for source categories or purposes other than printing and
publishing.
(3) Each facility for which the owner or operator chooses to commit
to and meets the criteria stated in paragraph (a)(2) of this section
shall be considered an area source, and is subject only to the
provisions of Sec. 63.829(d) and Sec. 63.830(b)(1) of this subpart.
(4) Each facility for which the owner or operator commits to the
conditions in paragraph (a)(2) of this section may exclude material
used in routine janitorial or facility grounds maintenance, personal
uses by employees or other persons, the use of products for the purpose
of maintaining electric, propane, gasoline and diesel powered motor
vehicles operated by the facility, and the use of HAP contained in
intake water (used for processing or noncontact cooling) or intake air
(used either as compressed air or for combustion).
(5) Each facility for which the owner or operator commits to the
conditions in paragraph (a)(2) of this section to become an area
source, but subsequently exceeds either of the thresholds in paragraph
(a)(2) of this section for any rolling 12-month period (without first
obtaining and complying with other limits that keep its potential to
emit HAP below major source levels), shall be considered in violation
of its commitment for that 12-month period and shall be considered a
major source of HAP beginning the first month after the end of the 12-
month period in which either of the HAP-use thresholds was exceeded. As
a major source of HAP, each such facility would be subject to the
provisions of this subpart as noted in paragraph (a)(1) of this section
and would no longer be eligible to use the provisions of paragraph
(a)(2) of this section, even if in subsequent 12-month periods the
facility uses less HAP than the thresholds in paragraph (a)(2) of this
section.
(6) An owner or operator of an affected source subject to paragraph
(a)(2) of this section who chooses to no longer be subject to paragraph
(a)(2) of this section shall notify the Administrator of such change.
If, by no longer being subject to paragraph (a)(2) of this section, the
facility at which the affected source is located becomes a major
source:
(i) The owner or operator of an existing source must continue to
comply with the HAP usage provisions of paragraph (a)(2) of this
section until the source is in compliance with all relevant
requirements for existing affected sources under this subpart;
(ii) The owner or operator of a new source must continue to comply
with the HAP usage provisions of paragraph (a)(2) of this section until
the source is in compliance with all relevant requirements for new
affected sources under this subpart.
(7) Nothing in this paragraph is intended to preclude a facility
from establishing area source status by limiting its potential to emit
through other appropriate mechanisms that may be available through the
permitting authority.
(b) This subpart does not apply to research or laboratory
equipment.
Sec. 63.821 Designation of affected sources.
(a) The affected sources subject to this subpart are:
(1) All of the publication rotogravure presses and all affiliated
equipment, including proof presses, cylinder and parts cleaners, ink
and solvent mixing and storage equipment, and solvent recovery
equipment at a facility.
(2) All of the product and packaging rotogravure or wide-web
flexographic printing presses at a facility plus any other equipment at
that facility which the owner or operator chooses to include in
accordance with paragraph (a)(3) of this section, except
(i) Proof presses, and
(ii) Any product and packaging rotogravure or wide-web flexographic
press which is used primarily for coating, laminating, or other
operations which the owner or operator chooses to exclude, provided
that
(A) The sum of the total mass of inks, coatings, varnishes,
adhesives, primers, solvents, thinners, reducers, and other materials
applied by the press using product and packaging rotogravure work
stations and the total mass of inks, coatings, varnishes, adhesives,
primers, solvents, thinners, reducers, and other materials applied by
the press using wide-web flexographic print stations in each month
never exceeds five weight-percent of the total mass of inks, coatings,
varnishes, adhesives, primers, solvents, thinners, reducers, and other
materials applied by the press in that month, including all inboard and
outboard stations, and
(B) The owner or operator maintains records as required in
Sec. 63.829(f).
(3) The owner or operator of an affected source, as defined in
paragraph (a)(2) of this section, may elect to include in that affected
source stand-alone coating equipment subject to the following
provisions:
(i) Stand-alone coating equipment meeting any of the criteria
specified in this subparagraph is eligible for inclusion:
(A) The stand-alone coating equipment and one or more product and
packaging rotogravure or wide-web flexographic presses are used to
apply solids-containing materials to the same web or substrate, or
(B) The stand-alone coating equipment and one or more product and
packaging rotogravure or wide-web flexographic presses apply a common
solids-containing material, or
(C) A common control device is used to control organic HAP
emissions from the stand-alone coating equipment and from one or more
product and packaging rotogravure or wide-web flexographic printing
presses;
(ii) All eligible stand-alone coating equipment located at the
facility is included in the affected source; and
(iii) No product and packaging rotogravure or wide-web flexographic
presses are excluded from the affected source under the provisions of
paragraph (a)(2)(ii) of this section.
(b) Each product and packaging rotogravure or wide-web flexographic
printing affected source at a facility that is a major source of HAP,
as defined in 40 CFR 63.2, that complies with the criteria of
paragraphs (b)(1) or (b)(2) on and after the applicable compliance date
as specified in Sec. 63.826 of this subpart is subject only to the
requirements of Sec. 63.829(e) and Sec. 63.830(b)(1) of this subpart.
(1) The owner or operator of the source applies no more than 500 kg
per month, for every month, of inks, coatings, varnishes, adhesives,
primers, solvents, thinners, reducers, and other materials on product
and packaging rotogravure or wide-web flexographic printing presses, or
(2) The owner or operator of the source applies no more than 400 kg
per month, for every month, of organic HAP
[[Page 27142]]
on product and packaging rotogravure or wide-web flexographic printing
presses.
(c) Each product and packaging rotogravure or wide-web flexographic
printing affected source at a facility that is a major source of HAP,
as defined in 40 CFR 63.2, that complies with neither the criterion of
paragraph (b)(1) nor (b)(2) of this section in an
FR Doc. 96-13084 National Emission Standards for Hazardous Air Pollutants; Final Standards for Hazardous Air Pollutant Emissions From the Printing and Publishing Industry
y month after the
applicable compliance date as specified in Sec. 63.826 of this subpart
is, starting with that month, subject to all relevant requirements of
this subpart and is no longer eligible to use the provisions of
paragraph (b) of this section, even if in subsequent months the
affected source does comply with the criteria of paragraphs (b)(1) or
(b)(2) of this section.
Sec. 63.822 Definitions.
(a) All terms used in this subpart that are not defined below have
the meaning given to them in the CAA and in subpart A of this part.
Always-controlled work station means a work station associated with
a dryer from which the exhaust is delivered to a control device, with
no provision for the dryer exhaust to bypass the control device.
Sampling lines for analyzers and relief valves needed for safety
purposes are not considered bypass lines.
Capture efficiency means the fraction of all organic HAP emissions
generated by a process that are delivered to a control device,
expressed as a percentage.
Capture system means a hood, enclosed room, or other means of
collecting organic HAP emissions into a closed-vent system that
exhausts to a control device.
Car-seal means a seal that is placed on a device that is used to
change the position of a valve or damper (e.g., from open to closed) in
such a way that the position of the valve or damper cannot be changed
without breaking the seal.
Certified product data sheet (CPDS) means documentation furnished
by suppliers of inks, coatings, varnishes, adhesives, primers,
solvents, and other materials or by an outside laboratory that provides
the organic HAP content of these materials, by weight, measured using
Method 311 of appendix A of this Part 63 or an equivalent or
alternative method (or formulation data as provided in Sec. 63.827(b))
and the solids content of these materials, by weight, determined in
accordance with Sec. 63.827(c). The purpose of the CPDS is to assist
the owner or operator in demonstrating compliance with the emission
limitations presented in Secs. 63.824-63.825.
Coating operation means the application of a uniform layer of
material across the entire width of a substrate.
Coating station means a work station on which a coating operation
is conducted.
Control device means a device such as a carbon adsorber or oxidizer
which reduces the organic HAP in an exhaust gas by recovery or by
destruction.
Control device efficiency means the ratio of organic HAP emissions
recovered or destroyed by a control device to the total HAP emissions
that are introduced into the control device, expressed as a percentage.
Day means a 24-consecutive-hour period.
Facility means all contiguous or adjoining property that is under
common ownership or control, including properties that are separated
only by a road or other public right-of-way.
Flexographic press means an unwind or feed section, a series of
individual work stations, one or more of which is a flexographic print
station, any dryers (including interstage dryers and overhead tunnel
dryers) associated with the work stations, and a rewind, stack, or
collection station. The work stations may be oriented vertically,
horizontally, or around the circumference of a single large impression
cylinder. Inboard and outboard work stations, including those employing
any other technology, such as rotogravure, are included if they are
capable of printing or coating on the same substrate.
Flexographic print station means a work station on which a
flexographic printing operation is conducted. A flexographic print
station includes a flexographic printing plate which is an image
carrier made of rubber or other elastomeric material. The image (type
and art) to be printed is raised above the printing plate.
HAP applied means the organic HAP content of all inks, coatings,
varnishes, adhesives, primers, solvent, and other materials applied to
a substrate by a product and packaging rotogravure or wide-web
flexographic printing affected source.
HAP used means the organic HAP applied by a publication rotogravure
printing affected source, including all organic HAP used for cleaning,
parts washing, proof presses, and all organic HAP emitted during tank
loading, ink mixing, and storage.
Intermittently-controllable work station means a work station
associated with a dryer with provisions for the dryer exhaust to be
delivered to or diverted from a control device depending on the
position of a valve or damper. Sampling lines for analyzers and relief
valves needed for safety purposes are not considered bypass lines.
Month means a calendar month or a prespecified period of 28 days to
35 days.
Never-controlled work station means a work station which is not
equipped with provisions by which any emissions, including those in the
exhaust from any associated dryer, may be delivered to a control
device.
Overall Organic HAP control efficiency means the total efficiency
of a control system, determined either by:
(1) The product of the capture efficiency and the control device
efficiency or
(2) A liquid-liquid material balance.
Print station means a work station on which a printing operation is
conducted.
Printing operation means the formation of words, designs, and
pictures on a substrate other than fabric through the application of
material to that substrate.
Product and packaging rotogravure printing means the production, on
a rotogravure press, of any printed substrate not otherwise defined as
publication rotogravure printing. This includes, but is not limited to,
folding cartons, flexible packaging, labels and wrappers, gift wraps,
wall and floor coverings, upholstery, decorative laminates, and tissue
products.
Proof press means any device used only to check the quality of the
image formation of rotogravure cylinders or flexographic plates, which
prints only non-saleable items.
Publication rotogravure printing means the production, on a
rotogravure press, of the following saleable paper products:
(1) Catalogues, including mail order and premium,
(2) Direct mail advertisements, including circulars, letters,
pamphlets, cards, and printed envelopes,
(3) Display advertisements, including general posters, outdoor
advertisements, car cards, window posters; counter and floor displays;
point of purchase and other printed display material,
(4) Magazines,
(5) Miscellaneous advertisements, including brochures, pamphlets,
catalog sheets, circular folders, announcements, package inserts, book
jackets, market circulars, magazine inserts, and shopping news,
(6) Newspapers, magazine and comic supplements for newspapers, and
preprinted newspaper inserts, including hi-fi and spectacolor rolls and
sections,
[[Page 27143]]
(7) Periodicals, and
(8) Telephone and other directories, including business reference
services.
Research or laboratory equipment means any equipment for which the
primary purpose is to conduct research and development into new
processes and products, where such equipment is operated under the
close supervision of technically trained personnel and is not engaged
in the manufacture of products for commercial sale in commerce, except
in a de minimis manner.
Rotogravure press means an unwind or feed section, a series of one
or more work stations, one or more of which is a rotogravure print
station, any dryers associated with the work stations, and a rewind,
stack, or collection section. Inboard and outboard work stations
including those employing any other technology, such as flexography,
are included if they are capable of printing or coating on the same
substrate.
Rotogravure print station means a work station on which a
rotogravure printing operation is conducted. A rotogravure print
station includes a rotogravure cylinder and ink supply. The image (type
and art) to be printed is etched or engraved below the surface of the
rotogravure cylinder. On a rotogravure cylinder the printing image
consists of millions of minute cells.
Stand-alone coating equipment means an unwind or feed section, a
series of one or more coating stations and any associated dryers, and a
rewind, stack or collection section that:
Is not part of a product and packaging rotogravure or wide-web
flexographic press, and
Is used to conduct one or more coating operations on a substrate.
Stand-alone coating equipment
May or may not process substrate that is also processed by a
product and packaging rotogravure or wide-web flexographic press, apply
solids-containing materials that are also applied by a product and
packaging rotogravure or wide-web flexographic press, and utilize a
control device that is also utilized by a product and packaging
rotogravure or wide-web flexographic press. Stand-alone coating
equipment is sometimes referred to as ``off-line'' coating equipment.
Wide-web flexographic press means a flexographic press capable of
printing substrates greater than 18 inches in width.
Work station means a unit on a rotogravure or wide-web flexographic
press where material is deposited onto a substrate.
(b) The symbols used in equations in this subpart are defined as
follows:
(1) Cahi=the monthly average, as-applied, organic HAP content
of solids-containing material, i, expressed as a weight-fraction, kg/
kg.
(2) Casi=the monthly average, as applied, solids content, of
solids-containing material, i, expressed as a weight-fraction, kg/kg.
(3) Chi=the organic HAP content of ink or other solids-
containing material, i, expressed as a weight-fraction, kg/kg.
(4) Chij=the organic HAP content of solvent j, added to
solids-containing material i, expressed as a weight-fraction, kg/kg.
(5) Chj=the organic HAP content of solvent j, expressed as a
weight-fraction, kg/kg.
(6) Ci=the organic volatile matter concentration in ppm, dry
basis, of compound i in the vent gas, as determined by Method 25 or
Method 25A.
(7) Csi=the solids content of ink or other material, i,
expressed as a weight-fraction, kg/kg.
(8) Cvi=the volatile matter content of ink or other material,
i, expressed as a weight-fraction, kg/kg.
(9) E=the organic volatile matter control efficiency of the control
device, percent.
(10) F=the organic volatile matter capture efficiency of the
capture system, percent.
(11) Gi=the mass fraction of each solids containing material,
i, which was applied at 20 weight-percent or greater solids content, on
an as-applied basis, kg/kg.
(12) H=the total monthly organic HAP applied, kg.
(13) Ha=the monthly allowable organic HAP emissions, kg.
(14) HL=the monthly average, as-applied, organic HAP content
of all solids-containing materials applied at less than 0.04 kg organic
HAP per kg of material applied, kg/kg.
(15) Hs=the monthly average, as-applied, organic HAP to solids
ratio, kg organic HAP/kg solids applied.
(16) Hsi=the as-applied, organic HAP to solids ratio of
material i.
(17) L=the mass organic HAP emission rate per mass of solids
applied, kg/kg.
(18) MBi=the sum of the mass of solids-containing material, i,
applied on intermittently-controllable work stations operating in
bypass mode and the mass of solids-containing material, i, applied on
never-controlled work stations, in a month, kg.
(19) MBj=the sum of the mass of solvent, thinner, reducer,
diluent, or other non-solids-containing material, j, applied on
intermittently-controllable work stations operating in bypass mode and
the mass of solvent, thinner, reducer, diluent, or other non-solids-
containing material, j, applied on never-controlled work stations, in a
month, kg.
(20) Mci=the sum of the mass of solids-containing material, i,
applied on intermittently-controllable work stations operating in
controlled mode and the mass of solids-containing material, i, applied
on always-controlled work stations, in a month, kg.
(21) Mcj=the sum of the mass of solvent, thinner, reducer,
diluent, or other non-solids-containing material, j, applied on
intermittently-controllable work stations operating in controlled mode
and the mass of solvent, thinner, reducer, diluent, or other non-
solids-containing material, j, applied on always-controlled work
stations in a month, kg.
(22) Mf=the total organic volatile matter mass flow rate, kg/
h.
(23) Mfi=the organic volatile matter mass flow rate at the
inlet to the control device, kg/h.
(24) Mfo=the organic volatile matter mass flow rate at the
outlet of the control device, kg/h.
(25) Mhu=the mass of organic HAP used in a month, kg.
(26) Mi=the mass of ink or other material, i, applied in a
month, kg.
(27) Mij=the mass of solvent, thinner, reducer, diluent, or
other non-solids-containing material, j, added to solids-containing
material, i, in a month, kg.
(28) Mj=the mass of solvent, thinner, reducer, diluent, or
other non-solids-containing material, j, applied in a month, kg.
(29) MLj=the mass of solvent, thinner, reducer, diluent, or
other non-solids-containing material, j, added to solids-containing
materials which were applied at less than 20 weight-percent solids
content, on an as-applied basis, in a month, kg.
(30) Mvr=the mass of volatile matter recovered in a month, kg.
(31) Mvu=the mass of volatile matter, including water, used in
a month, kg.
(32) MWi=the molecular weight of compound i in the vent gas,
kg/kg-mol.
(33) n=the number of organic compounds in the vent gas.
(34) p=the number of different inks, coatings, varnishes,
adhesives, primers, and other materials applied in a month.
(35) q=the number of different solvents, thinners, reducers,
diluents, or other non-solids-containing materials applied in a month.
(36) Qsd=the volumetric flow rate of gases entering or exiting
the control device, as determined by Method 2, dscm/h.
(37) R=the overall organic HAP control efficiency, percent.
[[Page 27144]]
(38) Re=the overall effective organic HAP control efficiency
for publication rotogravure, percent.
(39) Rv=the organic volatile matter collection and recovery
efficiency, percent.
(40) S=the mass organic HAP emission rate per mass of material
applied, kg/kg.
(41) 0.0416=conversion factor for molar volume, kg-mol/m3(@
293 K and 760 mmHg).
Sec. 63.823 Standards: General.
Table 1 to this subpart provides cross references to the 40 CFR
part 63, subpart A, general provisions, indicating the applicability of
the general provisions requirements to this subpart KK.
Sec. 63.824 Standards: Publication rotogravure printing.
(a) Each owner or operator of any publication rotogravure printing
affected source that is subject to the requirements of this subpart
shall comply with these requirements on and after the compliance dates
as specified in Sec. 63.826 of this subpart.
(b) Each publication rotogravure affected source shall limit
emissions of organic HAP to no more than eight percent of the total
volatile matter used each month. The emission limitation may be
achieved by overall control of at least 92 percent of organic HAP used,
by substitution of non-HAP materials for organic HAP, or by a
combination of capture and control technologies and substitution of
materials. To demonstrate compliance, each owner or operator shall
follow the procedure in paragraph (b)(1) of this section when emissions
from the affected source are controlled by a solvent recovery device,
the procedure in paragraph (b)(2) of this section when emissions from
the affected source are controlled by an oxidizer, and the procedure in
paragraph (b)(3) of this section when no control device is used.
(1) Each owner or operator using a solvent recovery device to
control emissions shall demonstrate compliance by showing that the HAP
emission limitation is achieved by following the procedures in either
paragraph (b)(1)(i) or (b)(1)(ii) of this section:
(i) Perform a liquid-liquid material balance for each month as
follows:
(A) Measure the mass of each ink, coating, varnish adhesive,
primer, solvent, and other material used by the affected source during
the month.
(B) Determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent and other material used by the
affected source during the month following the procedure in
Sec. 63.827(b)(1).
(C) Determine the volatile matter content, including water, of each
ink, coating, varnish, adhesive, primer, solvent, and other material
used by the affected source during the month following the procedure in
Sec. 63.827(c)(1).
(D) Install, calibrate, maintain and operate, according to the
manufacturer's specifications, a device that indicates the cumulative
amount of volatile matter recovered by the solvent recovery device on a
monthly basis. The device shall be initially certified by the
manufacturer to be accurate to within 2.0 percent.
(E) Measure the amount of volatile matter recovered for the month.
(F) Calculate the overall effective organic HAP control efficiency
(Re) for the month using Equation 1:
[GRAPHIC] [TIFF OMITTED] TR30MY96.000
For the purposes of this calculation, the mass fraction of organic HAP
present in the recovered volatile matter is assumed to be equal to the
mass fraction of organic HAP present in the volatile matter used.
(G) The affected source is in compliance for the month, if Re
is at least 92 percent each month.
(ii) Use continuous emission monitors, conduct an initial
performance test of capture efficiency, and continuously monitor a site
specific operating parameter to assure capture efficiency as specified
in paragraphs (b)(1)(ii)(A) through (b)(1)(ii)(E) of this section:
(A) Install continuous emission monitors to determine the total
organic volatile matter mass flow rate (e.g., by determining the
concentration of the vent gas in grams per cubic meter, and the
volumetric flow rate in cubic meters per second, such that the total
organic volatile matter mass flow rate in grams per second can be
calculated and summed) at both the inlet to and the outlet from the
control device, such that the percent control efficiency (E) of the
control device can be calculated for each month.
(B) Determine the percent capture efficiency (F) of the capture
system according to Sec. 63.827(e).
(C) Calculate the overall effective organic HAP control efficiency
(Re) achieved for each month using Equation 2.
[GRAPHIC] [TIFF OMITTED] TR30MY96.001
(D) Install, calibrate, operate and maintain the instrumentation
necessary to measure continuously the site-specific operating parameter
established in accordance with Sec. 63.828(a)(5) whenever a publication
rotogravure printing press is operated.
(E) The affected source is in compliance with the requirement for
the month if Re is at least 92 percent, and the capture device is
operated at an average value greater than, or less than (as
appropriate) the operating parameter value established in accordance
with Sec. 63.828(a)(5) for each three-hour period.
(2) Each owner or operator using an oxidizer to control emissions
shall demonstrate compliance by showing that the HAP emission
limitation is achieved by following the procedure in either paragraph
(b)(2)(i) or (b)(2)(ii) of this section:
(i) Demonstrate initial compliance through performance tests and
continuing compliance through continuous monitoring as follows:
(A) Determine the oxidizer destruction efficiency (E) using the
procedure in Sec. 63.827(d).
[[Page 27145]]
(B) Determine the capture efficiency (F) using the procedure in
Sec. 63.827(e).
(D) Calculate the overall effective organic HAP control efficiency
(Re) achieved using Equation 2.
(E) The affected source is in initial compliance if Re is at
least 92 percent. Demonstration of continuing compliance is achieved by
continuous monitoring of an appropriate oxidizer operating parameter in
accordance with Sec. 63.828(a)(4), and by continuous monitoring of an
appropriate capture system monitoring parameter in accordance with
Sec. 63.828(a)(5). The affected source is in continuing compliance if
the capture device is operated at an average value greater than or less
than (as appropriate) the operating parameter value established in
accordance with Sec. 63.828(a)(5), and
(1) if an oxidizer other than a catalytic oxidizer is used, the
average combustion temperature for all three-hour periods is greater
than or equal to the average combustion temperature established under
Sec. 63.827(d), or
(2) if a catalytic oxidizer is used, the average catalyst bed inlet
temperature for all three-hour periods is greater than or equal to the
average catalyst bed inlet temperature established in accordance with
Sec. 63.827(d).
(ii) Use continuous emission monitors, conduct an initial
performance test of capture efficiency, and continuously monitor a site
specific operating parameter to assure capture efficiency in accordance
with the requirements of paragraph (b)(1)(ii) of this section.
(3) To demonstrate compliance without the use of a control device,
each owner or operator shall compare the mass of organic HAP used to
the mass of volatile matter used each month, as specified in paragraphs
(b)(3)(i) through (b)(3)(iv) of this section:
(i) Measure the mass of each ink, coating, varnish adhesive,
primer, solvent, and other material used in the affected source during
the month,
(ii) Determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent, and other material used during the
month following the procedure in Sec. 63.827(b)(1), and
(iii) Determine the volatile matter content, including water, of
each ink, coating, varnish, adhesive, primer, solvent, and other
material used during the month following the procedure in
Sec. 63.827(c)(1).
(iv) The affected source is in compliance for the month if the mass
of organic HAP used does not exceed eight percent of the mass of
volatile matter used.
Sec. 63.825 Standards: Product and packaging rotogravure and wide-web
flexographic printing.
(a) Each owner or operator of any product and packaging rotogravure
or wide-web flexographic printing affected source that is subject to
the requirements of this subpart shall comply with these requirements
on and after the compliance dates as specified in Sec. 63.826 of this
subpart.
(b) Each product and packaging rotogravure or wide-web flexographic
printing affected source shall limit emissions to no more than five
percent of the organic HAP applied for the month; or to no more than
four percent of the mass of inks, coatings, varnishes, adhesives,
primers, solvents, reducers, thinners, and other materials applied for
the month; or to no more than 20 percent of the mass of solids applied
for the month; or to a calculated equivalent allowable mass based on
the organic HAP and solids contents of the inks, coatings, varnishes,
adhesives, primers, solvents, reducers, thinners, and other materials
applied for the month. The owner or operator of each product and
packaging rotogravure or wide-web flexographic printing affected source
shall demonstrate compliance with this standard by following one of the
procedures in paragraphs (b)(1) through (b)(10) of this section:
(1) Demonstrate that each ink, coating, varnish, adhesive, primer,
solvent, diluent, reducer, thinner, and other material applied during
the month contains no more than 0.04 weight-fraction organic HAP, on an
as-purchased basis, as determined in accordance with Sec. 63.827(b)(2).
(2) Demonstrate that each ink, coating, varnish, adhesive, primer,
and other solids-containing material applied during the month contains
no more than 0.04 weight-fraction organic HAP, on a monthly average as-
applied basis as determined in accordance with paragraphs (b)(2)(i)-
(ii) of this section. The owner or operator shall calculate the as-
applied HAP content of materials which are reduced, thinned, or diluted
prior to application, as follows:
(i) Determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent, diluent, reducer, thinner, and
other material applied on an as-purchased basis in accordance with
Sec. 63.827(b)(2).
(ii) Calculate the monthly average as-applied organic HAP content,
Cahi of each ink, coating, varnish, adhesive, primer, and other
solids-containing material using Equation 3.
[GRAPHIC] [TIFF OMITTED] TR30MY96.002
(3)(i) Demonstrate that each ink, coating, varnish, adhesive,
primer, and other solids-containing material applied, either
(A) Contains no more than 0.04 weight-fraction organic HAP on a
monthly average as-applied basis, or
(B) Contains no more than 0.20 kg of organic HAP per kg of solids
applied, on a monthly average as-applied basis.
(ii) The owner or operator may demonstrate compliance in accordance
with paragraphs (b)(3)(ii) (A)-(C) of this section.
(A) Use the procedures of paragraph (b)(2) of this section to
determine which materials meet the requirements of paragraph
(b)(3)(i)(A) of this section,
(B) Determine the as-applied solids content following the procedure
in Sec. 63.827(c)(2) of all materials which do not meet the
requirements of paragraph (b)(3)(i)(A) of this section. The owner or
operator may calculate the monthly average as-applied solids content of
materials which are reduced, thinned, or diluted prior to application,
using Equation 4, and
[GRAPHIC] [TIFF OMITTED] TR30MY96.003
(C) Calculate the as-applied organic HAP to solids ratio, Hsi,
for all materials which do not meet the requirements of
[[Page 27146]]
paragraph (b)(3)(i)(A) of this section, using Equation 5.
[GRAPHIC] [TIFF OMITTED] TR30MY96.004
(4) Demonstrate that the monthly average as-applied organic HAP
content, HL, of all materials applied is less than 0.04 kg HAP per
kg of material applied, as determined by Equation 6.
[GRAPHIC] [TIFF OMITTED] TR30MY96.005
(5) Demonstrate that the monthly average as-applied organic HAP
content on the basis of solids applied, Hs, is less than 0.20 kg
HAP per kg solids applied as determined by Equation 7.
[GRAPHIC] [TIFF OMITTED] TR30MY96.006
(6) Demonstrate that the total monthly organic HAP applied, H, as
determined by Equation 8, is less than the calculated equivalent
allowable organic HAP, Ha, as determined by paragraph (e) of this
section.
[GRAPHIC] [TIFF OMITTED] TR30MY96.007
(7) Operate a capture system and control device and demonstrate an
overall organic HAP control efficiency of at least 95 percent for each
month. If the affected source operates more than one capture system or
more than one control device, and has only always-controlled work
stations, then the owner or operator shall demonstrate compliance in
accordance with the provisions of either paragraph (f) or (h) of this
section. If the affected source operates one or more never-controlled
work stations or one or more intermittently-controllable work stations,
then the owner or operator shall demonstrate compliance in accordance
with the provisions of paragraph (f) of this section. Otherwise, the
owner or operator shall demonstrate compliance in accordance with the
procedure in paragraph (c) of this section when emissions from the
affected source are controlled by a solvent recovery device or the
procedure in paragraph (d) of this section when emissions are
controlled by an oxidizer.
(8) Operate a capture system and control device and limit the
organic HAP emission rate to no more than 0.20 kg organic HAP emitted
per kg solids applied as determined on a monthly average as-applied
basis. If the affected source operates more than one capture system,
more than one control device, one or more never-controlled work
stations, or one or more intermittently-controllable work stations,
then the owner or operator shall demonstrate compliance in accordance
with the provisions of paragraph (f) of this section. Otherwise, the
owner or operator shall demonstrate compliance following the procedure
in paragraph (c) of this section when emissions from the affected
source are controlled by a solvent recovery device or the procedure in
paragraph (d) of this section when emissions are controlled by an
oxidizer.
(9) Operate a capture system and control device and limit the
organic HAP emission rate to no more than 0.04 kg organic HAP emitted
per kg material applied as determined on a monthly average as-applied
basis. If the affected source operates more than one capture system,
more than one control device, one or more never-controlled work
stations, or one or more intermittently-controllable work stations,
then the owner or operator shall demonstrate compliance in accordance
with the provisions of paragraph (f) of this section. Otherwise, the
owner or operator shall demonstrate compliance following the procedure
in paragraph (c) of this section when emissions from the affected
source are controlled by a solvent recovery device or the procedure in
paragraph (d) of this section when emissions are controlled by an
oxidizer.
(10) Operate a capture system and control device and limit the
monthly organic HAP emissions to less than the allowable emissions as
calculated in accordance with paragraph (e) of this section. If the
affected source operates more than one capture system, more than one
control device, one or more never-controlled work stations, or one or
more intermittently-controllable work stations, then the owner or
operator shall demonstrate compliance in accordance with the provisions
of paragraph (f) of this section. Otherwise, the owner or operator
shall demonstrate compliance following the procedure in paragraph (c)
of this section when emissions from the affected source are controlled
by a solvent recovery device or the procedure in paragraph (d) of this
section when emissions are controlled by an oxidizer.
(c) To demonstrate compliance with the overall organic HAP control
efficiency requirement in Sec. 63.825(b)(7) or the organic HAP
emissions limitation requirements in Sec. 63.825(b)(8)-(10), each owner
or operator using a solvent recovery device to control emissions shall
show compliance by following the procedures in either paragraph (c)(1)
or (c)(2) of this section:
(1) Perform a liquid-liquid material balance for each and every
month as follows:
(i) Measure the mass of each ink, coating, varnish, adhesive,
primer, solvent and other material applied on the press or group of
presses controlled by a common solvent recovery device during the
month.
(ii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on material applied or emission of less than the calculated allowable
organic HAP, determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent, and other material applied during
the month following the procedure in Sec. 63.827(b)(2).
(iii) Determine the volatile matter content of each ink, coating,
varnish, adhesive, primer, solvent, and other material applied during
the month following the procedure in Sec. 63.827(c)(2).
(iv) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied or emission of less than the
calculated allowable organic HAP, determine the solids content of each
ink, coating, varnish, adhesive, primer, solvent, and other material
applied during the month following the procedure in Sec. 63.827(c)(2).
(v) Install, calibrate, maintain, and operate according to the
manufacturer's specifications, a device that indicates the cumulative
amount of volatile matter recovered by the solvent recovery device on a
monthly basis. The device shall be initially certified by the
manufacturer to be accurate to within 2.0 percent.
(vi) Measure the amount of volatile matter recovered for the month.
(vii) Calculate the volatile matter collection and recovery
efficiency, Rv, using Equation 9.
[GRAPHIC] [TIFF OMITTED] TR30MY96.008
(viii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP
[[Page 27147]]
emission rate based on material applied or emission of less than the
calculated allowable organic HAP, calculate the organic HAP emitted
during the month, H, using Equation 10.
[GRAPHIC] [TIFF OMITTED] TR30MY96.009
(ix) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, calculate the organic HAP
emission rate based on solids applied, L, using Equation 11.
[GRAPHIC] [TIFF OMITTED] TR30MY96.010
(x) If demonstrating compliance on the basis of organic HAP
emission rate based on materials applied, calculate the organic HAP
emission rate based on material applied, S, using Equation 12.
[GRAPHIC] [TIFF OMITTED] TR30MY96.011
(xi) The affected source is in compliance if
(A) The organic volatile matter collection and recovery efficiency,
Rv, is 95 percent or greater, or
(B) The organic HAP emission rate based on solids applied, L, is
0.20 kg organic HAP per kg solids applied or less, or
(C) the organic HAP emission rate based on material applied, S, is
0.04 kg organic HAP per kg material applied or less, or
(D) the organic HAP emitted during the month, H, is less than the
calculated allowable organic HAP, Ha, as determined using
paragraph (e) of this section.
(2) Use continuous emission monitors, conduct an initial
performance test of capture efficiency, and continuously monitor a site
specific operating parameter to assure capture efficiency following the
procedures in paragraphs (c)(2)(i) through (c)(2)(xi) of this section:
(i) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on materials applied, or emission of less than the calculated allowable
organic HAP, measure the mass of each ink, coating, varnish, adhesive,
primer, solvent, and other material applied on the press or group of
presses controlled by a common control device during the month.
(ii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on material applied or emission of less than the calculated allowable
organic HAP, determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent, and other material applied during
the month following the procedure in Sec. 63.827(b)(2).
(iii) Install continuous emission monitors to determine the total
organic volatile matter mass flow rate (e.g., by determining the
concentration of the vent gas in grams per cubic meter, and the
volumetric flow rate in cubic meters per second, such that the total
organic volatile matter mass flow rate in grams per second can be
calculated and summed) at both the inlet to and the outlet from the
control device, such that the percent control efficiency (E) of the
control device can be calculated for each month.
(iv) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied or emission of less than the
calculated allowable organic HAP, determine the solids content of each
ink, coating, varnish, adhesive, primer, solvent, and other material
applied during the month following the procedure in Sec. 63.827(c)(2).
(v) Install, calibrate, operate and maintain the instrumentation
necessary to measure continuously the site-specific operating parameter
established in accordance with Sec. 63.828(a)(5) whenever a product and
packaging rotogravure or wide-web flexographic printing press is
operated.
(vi) Determine the capture efficiency (F) in accordance with
Sec. 63.827(e)-(f).
(vii) Calculate the overall organic HAP control efficiency, (R),
achieved for each month using Equation 13.
[GRAPHIC] [TIFF OMITTED] TR30MY96.012
(viii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on material applied or emission of less than the calculated allowable
organic HAP, calculate the organic HAP emitted during the month, H, for
each month using Equation 14.
[GRAPHIC] [TIFF OMITTED] TR30MY96.013
(ix) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, calculate the organic HAP
emission rate based on solids applied, L, using Equation 15.
[GRAPHIC] [TIFF OMITTED] TR30MY96.014
(x) If demonstrating compliance on the basis of organic HAP
emission rate based on materials applied, calculate the organic HAP
emission rate based on material applied, S, using Equation 16.
[GRAPHIC] [TIFF OMITTED] TR30MY96.015
(xi) The affected source is in compliance if the capture system
operating parameter is operated at an average value greater than or
less than (as appropriate) the operating parameter
[[Page 27148]]
value established in accordance with Sec. 63.828(a)(5) for each three
hour period, and
(A) The organic volatile matter collection and recovery efficiency,
Rv, is 95 percent or greater, or
(B) The organic HAP emission rate based on solids applied, L, is
0.20 kg organic HAP per kg solids applied or less, or
(C) The organic HAP emission rate based on material applied, S, is
0.04 kg organic HAP per kg material applied or less, or
(D) The organic HAP emitted during the month, H, is less than the
calculated allowable organic HAP, Ha, as determined using
paragraph (e) of this section.
(d) To demonstrate compliance with the overall organic HAP control
efficiency requirement in Sec. 63.825(b)(7) or the overall organic HAP
emission rate limitation requirements in Sec. 63.825(b)(8)-(10), each
owner or operator using an oxidizer to control emissions shall show
compliance by following the procedures in either paragraph (d)(1) or
(d)(2) of this section:
(1) demonstrate initial compliance through performance tests of
capture efficiency and control device efficiency and continuing
compliance through continuous monitoring of capture system and control
device operating parameters following the procedures in paragraph
(d)(1)(i) through (d)(1)(xi) of this section:
(i) Determine the oxidizer destruction efficiency (E) using the
procedure in Sec. 63.827(d).
(ii) Determine the capture system capture efficiency (F) in
accordance with Sec. 63.827(e)-(f).
(iii) Calculate the overall organic HAP control efficiency, (R),
achieved using Equation 13.
(iv) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on materials applied or emission of less than the calculated allowable
organic HAP, measure the mass of each ink, coating, varnish, adhesive,
primer, solvent, and other material applied on the press or group of
presses controlled by a common solvent recovery device during the
month.
(v) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on material applied or emission of less than the calculated allowable
organic HAP, determine the organic HAP content of each ink, coating,
varnish, adhesive, primer, solvent, and other material applied during
the month following the procedure in Sec. 63.827(b)(2).
(vi) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied or emission of less than the
calculated allowable organic HAP, determine the solids content of each
ink, coating, varnish, adhesive, primer, solvent, and other material
applied during the month following the procedure in Sec. 63.827(c)(2).
(vii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, organic HAP emission rate based
on material applied or emission of less than the calculated allowable
organic HAP, calculate the organic HAP emitted during the month, H, for
each month using Equation 14.
(viii) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied, calculate the organic HAP
emission rate based on solids applied, L, for each month using Equation
15.
(ix) If demonstrating compliance on the basis of organic HAP
emission rate based on materials applied, calculate the organic HAP
emission rate based on material applied, S, using Equation 16.
(x) Install, calibrate, operate and maintain the instrumentation
necessary to measure continuously the site-specific operating
parameters established in accordance with Sec. 63.828(a)(4)-(5)
whenever a product and packaging rotogravure or wide-web flexographic
press is operating.
(xi) The affected source is in compliance, if the oxidizer is
operated such that the average operating parameter value is greater
than the operating parameter value established in accordance with
Sec. 63.828(a)(4) for each three-hour period, and the capture system
operating parameter is operated at an average value greater than or
less than (as appropriate) the operating parameter value established in
accordance with Sec. 63.828(a)(5) for each three hour period, and
(A) The overall organic HAP control efficiency, R, is 95 percent or
greater, or
(B) The organic HAP emission rate based on solids applied, L, is
0.20 kg organic HAP per kg solids applied or less, or
(C) The organic HAP emission rate based on material applied, S, is
0.04 kg organic HAP per kg material applied or less, or
(D) The organic HAP emitted during the month, H, is less than the
calculated allowable organic HAP, Ha, as determined using
paragraph (e) of this section.
(2) Use continuous emission monitors, conduct an initial
performance test of capture efficiency, and continuously monitor a site
specific operating parameter to assure capture efficiency. Compliance
shall be demonstrated in accordance with the requirements of paragraph
(c)(2) of this section.
(e) Owners or operators may calculate the monthly allowable HAP
emissions, Ha, for demonstrating compliance in accordance with
paragraph (b)(6), (c)(1)(xi)(D), (c)(2)(xi)(D), or (d)(1)(xi)(D) of
this section as follows:
(1) Determine the as-purchased mass of each ink, coating, varnish,
adhesive, primer, and other solids-containing material applied each
month, Mi.
(2) Determine the as-purchased solids content of each ink, coating,
varnish, adhesive, primer, and other solids-containing material applied
each month, in accordance with Sec. 63.827(c)(2), Csi.
(3) Determine the as-purchased mass fraction of each ink, coating,
varnish, adhesive, primer, and other solids-containing material which
was applied at 20 weight-percent or greater solids content, on an as-
applied basis, Gi.
(4) Determine the total mass of each solvent, diluent, thinner, or
reducer added to materials which were applied at less than 20 weight-
percent solids content, on an as-applied basis, each month, MLj.
(5) Calculate the monthly allowable HAP emissions, Ha, using
Equation 17.
[GRAPHIC] [TIFF OMITTED] TR30MY96.016
(f) Owners or operators of product and packaging rotogravure or
wide-web flexographic printing presses shall demonstrate compliance
according to the procedures in paragraphs (f)(1) through (f)(7) of this
section if the affected source operates more than one capture system,
more than one control device, one or more never-controlled
[[Page 27149]]
work stations, or one or more intermittently-controllable work
stations.
(1) The owner or operator of each solvent recovery system used to
control one or more product and packaging rotogravure or wide-web
flexographic presses for which the owner or operator chooses to comply
by means of a liquid-liquid mass balance shall determine the organic
HAP emissions for those presses controlled by that solvent recovery
system either
(i) in accordance with paragraphs (c)(1)(i)-(iii) and (c)(1)(v)-
(viii) of this section if the presses controlled by that solvent
recovery system have only always-controlled work stations, or
(ii) in accordance with paragraphs (c)(1)(ii)-(iii), (c)(1)(v)-
(vi), and (g) of this section if the presses controlled by that solvent
recovery system have one or more never-controlled or intermittently-
controllable work stations.
(2) The owner or operator of each solvent recovery system used to
control one or more product and packaging rotogravure or wide-web
flexographic presses, for which the owner or operator chooses to comply
by means of an initial test of capture efficiency, continuous emission
monitoring of the control device, and continuous monitoring of a
capture system operating parameter, shall
(i) For each capture system delivering emissions to that solvent
recovery system, monitor an operating parameter established in
accordance with Sec. 63.828(a)(5) to assure capture system efficiency,
and
(ii) Determine the organic HAP emissions for those presses served
by each capture system delivering emissions to that solvent recovery
system either
(A) In accordance with paragraphs (c)(2)(i)-(iii) and (c)(2)(v)-
(viii) of this section if the presses served by that capture system
have only always-controlled work stations, or
(B) In accordance with paragraphs (c)(2)(ii)-(iii), (c)(2)(v)-
(vii), and (g) of this section if the presses served by that capture
system have one or more never-controlled or intermittently-controllable
work stations.
(3) The owner or operator of each oxidizer used to control
emissions from one or more product and packaging rotogravure or wide-
web flexographic presses choosing to demonstrate compliance through
performance tests of capture efficiency and control device efficiency
and continuing compliance through continuous monitoring of capture
system and control device operating parameters, shall
(i) Monitor an operating parameter established in accordance with
Sec. 63.828(a)(4) to assure control device efficiency, and
(ii) For each capture system delivering emissions to that oxidizer,
monitor an operating parameter established in accordance with
Sec. 63.828(a)(5) to assure capture efficiency, and
(iii) Determine the organic HAP emissions for those presses served
by each capture system delivering emissions to that oxidizer either
(A) In accordance with paragraphs (d)(1)(i)-(v) and (d)(1)(vii) of
this section if the presses served by that capture system have only
always-controlled work stations, or
(B) In accordance with paragraphs (d)(1)(i)-(iii), (d)(1)(v), and
(g) of this section if the presses served by that capture system have
one or more never-controlled or intermittently-controllable work
stations.
(4) The owner or operator of each oxidizer used to control
emissions from one or more product and packaging rotogravure or wide-
web flexographic presses choosing to demonstrate compliance through an
initial capture efficiency test, continuous emission monitoring of the
control device and continuous monitoring of a capture system operating
parameter, shall
(i) For each capture system delivering emissions to that oxidizer,
monitor an operating parameter established in accordance with
Sec. 63.828(a)(5) to assure capture efficiency, and
(ii) Determine the organic HAP emissions for those presses served
by each capture system delivering emissions to that oxidizer either
(A) In accordance with paragraphs (c)(2)(i)-(iii) and (c)(2)(v)-
(viii) of this section if the presses served by that capture system
have only always-controlled work stations, or
(B) In accordance with paragraphs (c)(2)(ii)-(iii), (c)(2)(v)-
(vii), and (g) of this section if the presses served by that capture
system have one or more never-controlled or intermittently-controllable
work stations.
(5) The owner or operator of one or more uncontrolled product and
packaging rotogravure or wide-web flexographic printing presses shall
determine the organic HAP applied on those presses using Equation 8.
The organic HAP emitted from an uncontrolled press is equal to the
organic HAP applied on that press.
(6) If demonstrating compliance on the basis of organic HAP
emission rate based on solids applied or emission of less than the
calculated allowable organic HAP, the owner or operator shall determine
the solids content of each ink, coating, varnish, adhesive, primer,
solvent and other material applied during the month following the
procedure in Sec. 63.827(c)(2).
(7) The owner or operator shall determine the organic HAP emissions
for the affected source for the month by summing all organic HAP
emissions calculated according to paragraphs (f)(1), (f)(2)(ii),
(f)(3)(iii), (f)(4)(ii), and (f)(5) of this section. The affected
source is in compliance for the month, if all operating parameters
required to be monitored under paragraphs (f)(2)-(4) of this section
were maintained at the appropriate values, and
(i) The total mass of organic HAP emitted by the affected source
was not more than four percent of the total mass of inks, coatings,
varnishes, adhesives, primers, solvents, diluents, reducers, thinners
and other materials applied by the affected source, or
(ii) The total mass of organic HAP emitted by the affected source
was not more than 20 percent of the total mass of solids applied by the
affected source, or
(iii) The total mass of organic HAP emitted by the affected source
was not more than the equivalent allowable organic HAP emissions for
the affected source, Ha, calculated in accordance with paragraph
(e) of this section, or
(iv) The total mass of organic HAP emitted by the affected source
was not more than five percent of the total mass of organic HAP applied
by the affected source. The total mass of organic HAP applied by the
affected source in the month shall be determined by the owner or
operator using Equation 8.
(g) Owners or operators determining organic HAP emissions from a
press or group of presses having one or more never-controlled or
intermittently-controllable work stations and using the procedures
specified in paragraphs (f)(1)(ii), (f)(2)(ii)(B), (f)(3)(iii)(B), or
(f)(4)(ii)(B) of this section shall for that press or group of presses:
(1) Determine the sum of the mass of all inks, coatings, varnishes,
adhesives, primers, and other solids-containing materials which are
applied on intermittently-controllable work stations in bypass mode and
the mass of all inks, coatings, varnishes, adhesives, primers, and
other solids-containing materials which are applied on never-controlled
work stations during the month, MBi.
(2) Determine the sum of the mass of all solvents, reducers,
thinners, and other diluents which are applied on intermittently-
controllable work stations in bypass mode and the mass of all solvents,
reducers, thinners, and other diluents which are applied on never-
[[Page 27150]]
controlled work stations during the month, MBj.
(3) Determine the sum of the mass of all inks, coatings, varnishes,
adhesives, primers, and other solids-containing materials which are
applied on intermittently-controllable work stations in controlled mode
and the mass of all inks, coatings, varnishes, adhesives, primers, and
other solids-containing materials which are applied on always-
controlled work stations during the month, MBj.
(4) Determine the sum of the mass of all solvents, reducers,
thinners, and other diluents which are applied on intermittently-
controllable work stations in controlled mode and the mass of all
solvents, reducers, thinners, and other diluents which are applied on
always-controlled work stations during the month, MCj.
(5) For each press or group of presses for which the owner or
operator uses the provisions of paragraph (f)(1)(ii) of this section,
the owner or operator shall calculate the organic HAP emitted during
the month using Equation 18.
[GRAPHIC] [TIFF OMITTED] TR30MY96.017
(6) For each press or group of presses for which the owner or
operator uses the provisions of paragraphs (f)(2)(ii)(B),
(f)(3)(iii)(B), or (f)(4)(ii)(B) of this section, the owner or operator
shall calculate the organic HAP emitted during the month using Equation
(19).
[GRAPHIC] [TIFF OMITTED] TR30MY96.018
(h) If the affected source operates more than one capture system or
more than one control device, and has no never-controlled work stations
and no intermittently-controllable work stations, then the affected
source is in compliance with the 95 percent overall organic HAP control
efficiency requirement for the month if for each press or group of
presses controlled by a common control device:
(1) The volatile matter collection and recovery efficiency,
Rv, as determined by paragraphs (c)(1)(i), (c)(1)(iii), and
(c)(1)(v)-(vii) of this section is equal to or greater than 95 percent,
or
(2) The overall organic HAP control efficiency as determined by
paragraphs (c)(2)(iii) and (c)(2)(v)-(vii) of this section for each
press or group of presses served by that control device and a common
capture system is equal to or greater than 95 percent and the average
capture system operating parameter value for each capture system
serving that control device is greater than or less than (as
appropriate) the operating parameter value established for that capture
system in accordance with Sec. 63.828(a)(5) for each three hour period,
or
(3) The overall organic HAP control efficiency as determined by
paragraphs (d)(1)(i)-(iii) and (d)(1)(x) of this section for each press
or group of presses served by that control device and a common capture
system is equal to or greater than 95 percent, the oxidizer is operated
such that the average operating parameter value is greater than the
operating parameter value established in accordance with
Sec. 63.828(a)(4) for each three hour period, and the average capture
system operating parameter value for each capture system serving that
control device is greater than or less than (as appropriate) the
operating parameter value established for that capture system in
accordance with Sec. 63.828(a)(5) for each three hour period.
Sec. 63.826 Compliance dates.
(a) The compliance date for an owner or operator of an existing
affected source subject to the provisions of this subpart is May 30,
1999.
(b) The compliance date for an owner or operator of a new affected
source subject to the provisions of this subpart is immediately upon
start-up of the affected source, or May 30, 1996, whichever is later.
(c) Affected sources which have undergone reconstruction are
subject to the requirements for new affected sources. The costs
associated with the purchase and installation of air pollution control
equipment are not considered in determining whether the affected source
has been reconstructed. Additionally, the costs of retrofitting and
replacement of equipment that is installed specifically to comply with
this subpart are not considered reconstruction costs.
Sec. 63.827 Performance test methods.
(a) An owner or operator using a control device to comply with the
requirements of Secs. 63.824-63.825 is not required to conduct an
initial performance test to demonstrate compliance if one or more of
the criteria in paragraphs (a)(1) through (a)(3) of this section are
met:
(1) A control device that is in operation prior to May 30, 1996,
does not need to be tested if
(i) It is equipped with continuous emission monitors for
determining inlet and outlet total organic volatile matter
concentration, and capture efficiency has been determined in accordance
with the requirements of this subpart, such that an overall HAP control
efficiency can be calculated, and
(ii) The continuous emission monitors are used to demonstrate
continuous compliance in accordance with Sec. 63.828, or
(2) The owner or operator has met the requirements of either
Sec. 63.7(e)(2)(iv) or Sec. 63.7(h), or
(3) The control device is a solvent recovery system and the owner
or operator chooses to comply by means of a monthly liquid-liquid
material balance.
(b) Determination of the organic HAP content of inks, coatings,
varnishes, adhesives, primers, solvents, thinners, reducers, diluents,
and other materials for the purpose of meeting the requirements of
Sec. 63.824 shall be
[[Page 27151]]
conducted according to paragraph (b)(1) of this section. Determination
of the organic HAP content of inks, coatings, varnishes, adhesives,
primers, solvents, thinners, reducers, diluents, and other materials
for the purpose of meeting the requirements of Sec. 63.825 shall be
conducted according to paragraph (b)(2) of this section.
(1) Each owner or operator of a publication rotogravure facility
shall determine the organic HAP weight-fraction of each ink, coating,
varnish, adhesive, primer, solvent, and other material used in a
publication rotogravure affected source by following one of the
procedures in paragraphs (b)(1)(i) through (b)(1)(iii) of this section:
(i) The owner or operator may test the material in accordance with
Method 311 of appendix A of this Part 63. The Method 311 determination
may be performed by the manufacturer of the material and the results
provided to the owner or operator. If these values cannot be determined
using Method 311, the owner or operator shall submit an alternative
technique for determining their values for approval by the
Administrator. The recovery efficiency of the technique must be
determined for all of the target organic HAP and a correction factor,
if necessary, must be determined and applied.
(ii) The owner or operator may determine the volatile matter
content of the material in accordance with Sec. 63.827(c)(1) and use
this value for the organic HAP content for all compliance purposes.
(iii) The owner or operator may, except as noted in paragraph
(b)(1)(iv) of this section, rely on formulation data provided by the
manufacturer of the material on a CPDS if
(A) The manufacturer has included in the organic HAP content
determination all HAP present at a level greater than 0.1 percent in
any raw material used, weighted by the mass fraction of each raw
material used in the material, and
(B) The manufacturer has determined the HAP content of each raw
material present in the formulation by Method 311 of appendix A of this
part 63, or by an alternate method approved by the Administrator, or by
reliance on a CPDS from a raw material supplier prepared in accordance
with Sec. 63.827(b)(1)(iii)(A).
(iv) In the event of any inconsistency between the Method 311 of
appendix A of this part 63 test data and formulation data, that is, if
the Method 311 test value is higher, the Method 311 test data shall
govern, unless after consultation, an owner or operator demonstrates to
the satisfaction of the enforcement authority that the formulation data
are correct.
(2) Each owner or operator of a product and packaging rotogravure
or wide-web flexographic printing facility shall determine the organic
HAP weight fraction of each ink, coating, varnish, adhesive, primer,
solvent, thinner, reducer, diluent, and other material applied by
following one of the procedures in paragraphs (b)(2)(i) through
(b)(2)(iii) of this section:
(i) The owner or operator may test the material in accordance with
Method 311 of appendix A of this part 63. The Method 311 determination
may be performed by the manufacturer of the material and the results
provided to the owner or operator. If these values cannot be determined
using Method 311, the owner or operator shall submit an alternative
technique for determining their values for approval by the
Administrator. The recovery efficiency of the technique must be
determined for all of the target organic HAP and a correction factor,
if necessary, must be determined and applied.
(ii) The owner or operator may determine the volatile matter
content of the material in accordance with Sec. 63.827(c)(2) and use
this value for the organic HAP content for all compliance purposes.
(iii) The owner or operator may, except as noted in paragraph
(b)(2)(iv) of this section, rely on formulation data provided by the
manufacturer of the material on a CPDS if
(A) The manufacturer has included in the organic HAP content
determination, all organic HAP present at a level greater than 0.1
percent in any raw material used, weighted by the mass fraction of each
raw material used in the material, and
(B) The manufacturer has determined the organic HAP content of each
raw material present in the formulation by Method 311 of appendix A of
this part 63, or, by an alternate method approved by the Administrator,
or, by reliance on a CPDS from a raw material supplier prepared in
accordance with Sec. 63.827(b)(2)(iii)(A).
(iv) In the event of any inconsistency between the Method 311 of
appendix A of this part 63 test data and a facility's formulation data,
that is, if the Method 311 test value is higher, the Method 311 test
data shall govern, unless after consultation, an owner or operator
demonstrates to the satisfaction of the enforcement authority that the
formulation data are correct.
(c) Determination by the owner or operator of the volatile matter
content of inks, coatings, varnishes, adhesives, primers, solvents,
reducers, thinners, diluents, and other materials used for the purpose
of meeting the requirements of Sec. 63.824 shall be conducted according
to paragraph (c)(1) of this section. Determination by the owner or
operator of the volatile matter and solids content of inks, coatings,
varnishes, adhesives, primers, solvents, reducers, thinners, diluents,
and other materials applied for the purpose of meeting the requirements
of Sec. 63.825 shall be conducted according to paragraph (c)(2) of this
section.
(1) Each owner or operator of a publication rotogravure facility
shall determine the volatile matter weight-fraction of each ink,
coating, varnish, adhesive, primer, solvent, reducer, thinner, diluent,
and other material used using Method 24A of 40 CFR part 60, appendix A.
The Method 24A determination may be performed by the manufacturer of
the material and the results provided to the owner or operator. If
these values cannot be determined using Method 24A, the owner or
operator shall submit an alternative technique for determining their
values for approval by the Administrator. The owner or operator may
rely on formulation data, subject to the provisions of paragraph (c)(3)
of this section.
(2) Each owner or operator of a product and packaging rotogravure
or wide-web flexographic printing facility shall determine the volatile
matter and solids weight-fraction of each ink, coating, varnish,
adhesive, primer, solvent, reducer, thinner, diluent, and other
material applied using Method 24 of 40 CFR part 60, appendix A. The
Method 24 determination may be performed by the manufacturer of the
material and the results provided to the owner or operator. If these
values cannot be determined using Method 24, the owner or operator
shall submit an alternative technique for determining their values for
approval by the Administrator. The owner or operator may rely on
formulation data, subject to the provisions of paragraph (c)(3) of this
section.
(3) Owners or operators may determine the volatile matter content
of materials based on formulation data, and may rely on volatile matter
content data provided by material suppliers. In the event of any
inconsistency between the formulation data and the results of Test
Methods 24 or 24A of 40 CFR part 60, appendix A, the applicable test
method shall govern, unless after consultation, the owner or operator
can demonstrate to the satisfaction of the enforcement agency that the
formulation data are correct.
(d) A performance test of a control device to determine destruction
[[Page 27152]]
efficiency for the purpose of meeting the requirements of Secs. 63.824-
63.825 shall be conducted by the owner or operator in accordance with
the following:
(1) An initial performance test to establish the destruction
efficiency of an oxidizer and the associated combustion zone
temperature for a thermal oxidizer and the associated catalyst bed
inlet temperature for a catalytic oxidizer shall be conducted and the
data reduced in accordance with the following reference methods and
procedures:
(i) Method 1 or 1A of 40 CFR part 60, appendix A is used for sample
and velocity traverses to determine sampling locations.
(ii) Method 2, 2A, 2C, or 2D of 40 CFR part 60, appendix A is used
to determine gas volumetric flow rate.
(iii) Method 3 of 40 CFR part 60, appendix A is used for gas
analysis to determine dry molecular weight.
(iv) Method 4 of 40 CFR part 60, appendix A is used to determine
stack gas moisture.
(v) Methods 2, 2A, 3, and 4 of 40 CFR part 60, appendix A shall be
performed, as applicable, at least twice during each test period.
(vi) Method 25 of 40 CFR part 60, Appendix A, shall be used to
determine organic volatile matter concentration, except as provided in
paragraphs (d)(1)(vi)(A)-(C) of this section. The owner or operator
shall submit notice of the intended test method to the Administrator
for approval along with notice of the performance test required under
Sec. 63.7(c). The owner or operator may use Method 25A of 40 CFR part
60, appendix A, if
(A) An exhaust gas organic volatile matter concentration of 50
parts per million by volume (ppmv) or less is required to comply with
the standards of Secs. 63.824-63.825, or
(B) The organic volatile matter concentration at the inlet to the
control system and the required level of control are such to result in
exhaust gas organic volatile matter concentrations of 50 ppmv or less,
or
(C) Because of the high efficiency of the control device, the
anticipated organic volatile matter concentration at the control device
exhaust is 50 ppmv or less, regardless of inlet concentration.
(vii) Each performance test shall consist of three separate runs;
each run conducted for at least one hour under the conditions that
exist when the affected source is operating under normal operating
conditions. For the purpose of determining organic volatile matter
concentrations and mass flow rates, the average of results of all runs
shall apply.
(viii) Organic volatile matter mass flow rates shall be determined
using Equation 20:
[GRAPHIC] [TIFF OMITTED] TR30MY96.019
(ix) Emission control device efficiency shall be determined using
Equation 21:
[GRAPHIC] [TIFF OMITTED] TR30MY96.020
(2) The owner or operator shall record such process information as
may be necessary to determine the conditions of the performance test.
Operations during periods of start-up, shutdown, and malfunction shall
not constitute representative conditions for the purpose of a
performance test.
(3) For the purpose of determining the value of the oxidizer
operating parameter that will demonstrate continuing compliance, the
time-weighted average of the values recorded during the performance
test shall be computed. For an oxidizer other than catalytic oxidizer,
the owner or operator shall establish as the operating parameter the
minimum combustion temperature. For a catalytic oxidizer, the owner or
operator shall establish as the operating parameter the minimum gas
temperature upstream of the catalyst bed. These minimum temperatures
are the operating parameter values that demonstrate continuing
compliance with the requirements of Secs. 63.824-63.825.
(e) A performance test to determine the capture efficiency of each
capture system venting organic emissions to a control device for the
purpose of meeting the requirements of Secs. 63.824(b)(1)(ii),
63.824(b)(2), 63.825(c)(2), 63.825(d)(1)-(2), 63.825(f)(2)-(4), or
63.825(h)(2)-(3) shall be conducted by the owner or operator in
accordance with the following:
(1) For permanent total enclosures, capture efficiency shall be
assumed as 100 percent. Procedure T--Criteria for and Verification of a
Permanent or Temporary Total Enclosure as found in appendix B to
Sec. 52.741 of part 52 of this chapter shall be used to confirm that an
enclosure meets the requirements for permanent total enclosure.
(2) For temporary total enclosures, the capture efficiency shall be
determined according to the protocol specified in
Sec. 52.741(a)(4)(iii)(B) of part 52 of this chapter. The owner or
operator may exclude never-controlled work stations from such capture
efficiency determinations.
(f) As an alternative to the procedures specified in Sec. 63.827(e)
an owner or operator required to conduct a capture efficiency test may
use any capture efficiency protocol and test methods that satisfy the
criteria of either the Data Quality Objective (DQO) or the Lower
Confidence Limit (LCL) approach as described in Appendix A of this
subpart. The owner or operator may exclude never-controlled work
stations from such capture efficiency determinations.
Sec. 63.828 Monitoring requirements.
(a) Following the date on which the initial performance test of a
control device is completed, to demonstrate continuing compliance with
the standard, the owner or operator shall monitor and inspect each
control device required to comply with Secs. 63.824-63.825 to ensure
proper operation and maintenance by implementing the applicable
requirements in paragraph (a)(1) through (a)(5) of this section.
(1) Owners or operators of product and packaging rotogravure or
wide-web flexographic presses with intermittently-controllable work
stations shall follow one of the procedures in paragraphs (a)(1)(i)
through (a)(1)(iv) of this section for each dryer associated with such
a work station:
(i) Install, calibrate, maintain, and operate according to the
manufacturer's specifications a flow control position indicator that
provides a record indicating whether the exhaust stream from the dryer
was directed to the control device or was diverted from the control
device. The time and flow control position must be recorded at least
once per hour, as well as every time the flow direction is changed. The
flow control position indicator shall be installed at the entrance to
any bypass line that could divert the exhaust stream away from the
control device to the atmosphere.
[[Page 27153]]
(ii) Secure any bypass line valve in the closed position with a
car-seal or a lock-and-key type configuration; a visual inspection of
the seal or closure mechanism shall be performed at least once every
month to ensure that the valve or damper is maintained in the closed
position and the exhaust stream is not diverted through the bypass
line.
(iii) Ensure that any bypass line valve or damper is in the closed
position through continuous monitoring of valve position. The
monitoring system shall be inspected at least once every month to
ensure that it is functioning properly.
(iv) Use an automatic shutdown system in which the press is stopped
when flow is diverted away from the control device to any bypass line.
The automatic system shall be inspected at least once every month to
ensure that it is functioning properly.
(2) Compliance monitoring shall be subject to the provisions of
paragraphs (a)(2)(i) and (a)(2)(ii) of this section, as applicable.
(i) All continuous emission monitors shall comply with performance
specifications (PS) 8 or 9 of 40 CFR part 60, appendix B, as
appropriate. The requirements of Appendix F of 40 CFR part 60 shall
also be followed. In conducting the quarterly audits required by
appendix F, owners or operators must challenge the monitors with
compounds representative of the gaseous emission stream being
controlled.
(ii) All temperature monitoring equipment shall be installed,
calibrated, maintained, and operated according to manufacturers
specifications. The calibration of the chart recorder, data logger, or
temperature indicator shall be verified every three months; or the
chart recorder, data logger, or temperature indicator shall be
replaced. The replacement shall be done either if the owner or operator
chooses not to perform the calibration, or if the equipment cannot be
calibrated properly.
(3) An owner or operator complying with Secs. 63.824-63.825 through
continuous emission monitoring of a control device shall install,
calibrate, operate, and maintain continuous emission monitors to
measure the total organic volatile matter concentration at both the
control device inlet and the outlet.
(4) An owner or operator complying with the requirements of
Secs. 63.824-63.825 through the use of an oxidizer and demonstrating
continuous compliance through monitoring of an oxidizer operating
parameter shall:
(i) For an oxidizer other than a catalytic oxidizer, install,
calibrate, operate, and maintain a temperature monitoring device
equipped with a continuous recorder. The device shall have an accuracy
of 1 percent of the temperature being monitored in deg.C
or 1 deg.C, whichever is greater. The thermocouple or
temperature sensor shall be installed in the combustion chamber at a
location in the combustion zone.
(ii) For a catalytic oxidizer, install, calibrate, operate, and
maintain a temperature monitoring device equipped with a continuous
recorder. The device shall be capable of monitoring temperature with an
accuracy of 1 percent of the temperature being monitored in
deg.C or 1 deg.C, whichever is greater. The thermocouple
or temperature sensor shall be installed in the vent stream at the
nearest feasible point to the catalyst bed inlet.
(5) An owner or operator complying with the requirements of
Secs. 63.824-63.825 through the use of a control device and
demonstrating continuous compliance by monitoring an operating
parameter to ensure that the capture efficiency measured during the
initial compliance test is maintained, shall:
(i) Submit to the Administrator with the compliance status report
required by Sec. 63.9(h) of the General Provisions, a plan that
(A) Identifies the operating parameter to be mon
FR Doc. 96-13084 National Emission Standards for Hazardous Air Pollutants; Final Standards for Hazardous Air Pollutant Emissions From the Printing and Publishing Industry
itored to ensure
that the capture efficiency measured during the initial compliance test
is maintained,
(B) Discusses why this parameter is appropriate for demonstrating
ongoing compliance, and
(C) Identifies the specific monitoring procedures;
(ii) Set the operating parameter value, or range of values, that
demonstrate compliance with Secs. 63.824-63.825, and
(iii) Conduct monitoring in accordance with the plan submitted to
the Administrator unless comments received from the Administrator
require an alternate monitoring scheme.
(b) Any excursion from the required operating parameters which are
monitored in accordance with paragraphs (a)(4) and (a)(5) of this
section, unless otherwise excused, shall be considered a violation of
the emission standard.
Sec. 63.829 Recordkeeping requirements.
(a) The recordkeeping provisions of 40 CFR part 63 subpart A of
this part that apply and those that do not apply to owners and
operators of affected sources subject to this subpart are listed in
Table 1 of this subpart.
(b) Each owner or operator of an affected source subject to this
subpart shall maintain the records specified in paragraphs (b)(1)
through (b)(3) of this section on a monthly basis in accordance with
the requirements of Sec. 63.10(b)(1) of this part:
(1) Records specified in Sec. 63.10(b)(2) of this part, of all
measurements needed to demonstrate compliance with this standard, such
as continuous emission monitor data, control device and capture system
operating parameter data, material usage, HAP usage, volatile matter
usage, and solids usage that support data that the source is required
to report.
(2) Records specified in Sec. 63.10(b)(3) of this part for each
applicability determination performed by the owner or operator in
accordance with the requirements of Sec. 63.820(a) of this subpart, and
(3) Records specified in Sec. 63.10(c) of this part for each
continuous monitoring system operated by the owner or operator in
accordance with the requirements of Sec. 63.828(a) of this subpart.
(c) Each owner or operator of an affected source subject to this
subpart shall maintain records of all liquid-liquid material balances
performed in accordance with the requirements of Secs. 63.824-63.825 of
this subpart. The records shall be maintained in accordance with the
requirements of Sec. 63.10(b) of this part.
(d) The owner or operator of each facility which commits to the
criteria of Sec. 63.820(a)(2) shall maintain records of all required
measurements and calculations needed to demonstrate compliance with
these criteria, including the mass of all HAP containing materials used
and the mass fraction of HAP present in each HAP containing material
used, on a monthly basis.
(e) The owner or operator of each facility which meets the limits
and criteria of Sec. 63.821(b)(1) shall maintain records as required in
paragraph (e)(1) of this section. The owner or operator of each
facility which meets the limits and criteria of Sec. 63.821(b)(2) shall
maintain records as required in paragraph (e)(2) of this section.
Owners or operators shall maintain these records for five years, and
upon request, submit them to the Administrator.
(1) For each facility which meets the criteria of
Sec. 63.821(b)(1), the owner or operator shall maintain records of the
total volume of each material applied on product and packaging
rotogravure or wide-web flexographic printing presses during each
month.
(2) For each facility which meets the criteria of
Sec. 63.821(b)(2), the owner or operator shall maintain records of the
[[Page 27154]]
total volume and organic HAP content of each material applied on
product and packaging rotogravure or wide-web flexographic printing
presses during each month.
(f) The owner or operator choosing to exclude from an affected
source, a product and packaging rotogravure or wide-web flexographic
press which meets the limits and criteria of Sec. 63.821(a)(2)(ii)(A)
shall maintain the records specified in paragraphs (f)(1) and (f)(2) of
this section for five years and submit them to the Administrator upon
request:
(1) The total mass of each material applied each month on the
press, including all inboard and outboard stations, and
(2) The total mass of each material applied each month on the press
by product and packaging rotogravure or wide-web flexographic printing
operations.
Sec. 63.830 Reporting requirements.
(a) The reporting provisions of 40 CFR part 63 subpart A of this
part that apply and those that do not apply to owners and operators of
affected sources subject to this subpart are listed in Table 1 of this
subpart.
(b) Each owner or operator of an affected source subject to this
subpart shall submit the reports specified in paragraphs (b)(1) through
(b)(6) of this section to the Administrator:
(1) An initial notification required in Sec. 63.9(b).
(i) Initial notifications for existing sources shall be submitted
no later than one year before the compliance date specified in
Sec. 63.826(a).
(ii) Initial notifications for new and reconstructed sources shall
be submitted as required by Sec. 63.9(b).
(iii) For the purpose of this subpart, a Title V or part 70 permit
application may be used in lieu of the initial notification required
under Sec. 63.9(b), provided the same information is contained in the
permit application as required by Sec. 63.9(b), and the State to which
the permit application has been submitted has an approved operating
permit program under part 70 of this chapter and has received
delegation of authority from the EPA.
(iv) Permit applications shall be submitted by the same due dates
as those specified for the initial notifications.
(2) A Notification of Performance Tests specified in Sec. 63.7 and
Sec. 63.9(e) of this part. This notification, and the site-specific
test plan required under Sec. 63.7(c)(2) shall identify the operating
parameter to be monitored to ensure that the capture efficiency
measured during the performance test is maintained. The operating
parameter identified in the site-specific test plan shall be considered
to be approved unless explicitly disapproved, or unless comments
received from the Administrator require monitoring of an alternate
parameter.
(3) A Notification of Compliance Status specified in Sec. 63.9(h)
of this part.
(4) Performance test reports specified in Sec. 63.10(d)(2) of this
part.
(5) Start-up, shutdown, and malfunction reports specified in
Sec. 63.10(d)(5) of this part, except that the provisions in subpart A
pertaining to start-ups, shutdowns, and malfunctions do not apply
unless a control device is used to comply with this subpart.
(i) If actions taken by an owner or operator during a start-up,
shutdown, or malfunction of an affected source (including actions taken
to correct a malfunction) are not completely consistent with the
procedures specified in the source's start-up, shutdown, and
malfunction plan specified in Sec. 63.6(e)(3) of this part, the owner
or operator shall state such information in the report. The start-up,
shutdown, or malfunction report shall consist of a letter containing
the name, title, and signature of the responsible official who is
certifying its accuracy, that shall be submitted to the Administrator.
(ii) Separate start-up, shutdown, or malfunction reports are not
required if the information is included in the report specified in
paragraph (b)(6) of this section.
(6) A summary report specified in Sec. 63.10(e)(3) of this part
shall be submitted on a semi-annual basis (i.e., once every six-month
period). In addition to a report of operating parameter exceedances as
required by Sec. 63.10(e)(3)(i), the summary report shall include, as
applicable:
(i) Exceedances of the standards in Secs. 63.824-63.825.
(ii) Exceedances of either of the criteria of Sec. 63.820(a)(2).
(iii) Exceedances of the criterion of Sec. 63.821(b)(1) and the
criterion of Sec. 63.821(b)(2) in the same month.
(iv) Exceedances of the criterion of Sec. 63.821(a)(2)(ii)(A).
Sec. 63.831 Delegation of authority.
(a) In delegating implementation and enforcement authority to a
State under 40 CFR part 63 subpart E of this part, the authorities
contained in paragraph (b) of this section shall be retained by the
Administrator and not transferred to a State.
(b) Authority which will not be delegated to States:
Sec. 63.827(b), approval of alternate test method for organic HAP
content determination; Sec. 63.827(c), approval of alternate test
method for volatile matter determination.
Table 1 to Subpart KK.--Applicability of General Provisions to Subpart
KK
------------------------------------------------------------------------
Applicable to
General provisions reference subpart KK Comment
------------------------------------------------------------------------
Sec. 63.1(a)(1)-(a)(4)....... Yes.
Sec. 63.1(a)(5).............. No............... Section reserved.
Sec. 63.1(a)(6)-(a)(8)....... No.
Sec. 63.1(a)(9).............. No............... Section reserved.
Sec. 63.1(a)(10)-(a)(14)..... Yes.
Sec. 63.1(b)(1).............. No............... Subpart KK specifies
applicability.
Sec. 63.1(b)(2)-(b)(3)....... Yes.
Sec. 63.1(c)(1).............. Yes.
Sec. 63.1(c)(2).............. No............... Area sources are not
subject to subpart
KK.
Sec. 63.1(c)(3).............. No............... Section reserved.
Sec. 63.1(c)(4).............. Yes.
Sec. 63.1(c)(5).............. No.
Sec. 63.1(d)................. No............... Section reserved.
Sec. 63.1(e)................. Yes.
Sec. 63.2.................... Yes.............. Additional
definitions in
subpart KK.
Sec. 63.3(a)-(c)............. Yes.
Sec. 63.4(a)(1)-(a)(3)....... Yes.
Sec. 63.4(a)(4).............. No............... Section reserved.
[[Page 27155]]
Sec. 63.4(a)(5).............. Yes.
Sec. 63.4(b-c)............... Yes.
Sec. 63.5(a)(1)-(a)(2)....... Yes.
Sec. 63.5(b)(1).............. Yes.
Sec. 63.5(b)(2).............. No............... Section reserved.
Sec. 63.5(b)(3)-(b)(6)....... Yes.
Sec. 63.5(c)................. No............... Section reserved.
Sec. 63.5(d)................. Yes.
Sec. 63.5(e)................. Yes.
Sec. 63.5(f)................. Yes.
Sec. 63.6(a)................. Yes.
Sec. 63.6(b)(1)-(b)(5)....... Yes.
Sec. 63.6(b)(6).............. No............... Section reserved.
Sec. 63.6(b)(7).............. Yes.
Sec. 63.6(c)(1)-(c)(2)....... Yes.
Sec. 63.6(c)(3)-(c)(4)....... No............... Sections reserved.
Sec. 63.6(c)(5).............. Yes.
Sec. 63.6(d)................. No............... Section reserved.
Sec. 63.6(e)................. Yes.............. Provisions pertaining
to start-ups,
shutdowns,
malfunctions, and
CMS do not apply
unless an add-on
control system is
used.
Sec. 63.6(f)................. Yes.
Sec. 63.6(g)................. Yes.
Sec. 63.6(h)................. No............... Subpart KK does not
require COMS.
Sec. 63.6(i)(1)-(i)(14)...... Yes.
Sec. 63.6(i)(15)............. No............... Section reserved.
Sec. 63.6(i)(16)............. Yes.
Sec. 63.6(j)................. Yes.
Sec. 63.7.................... Yes.
Sec. 63.8(a)(1)-(a)(2)....... Yes.
Sec. 63.8(a)(3).............. No............... Section reserved.
Sec. 63.8(a)(4).............. No............... Subpart KK specifies
the use of solvent
recovery devices or
oxidizers.
Sec. 63.8(b)................. Yes.
Sec. 63.8(c)(1)-(3).......... Yes.
Sec. 63.8(c)(4).............. No............... Subpart KK specifies
CMS sampling
requirements.
Sec. 63.8(c)(5).............. No............... Subpart KK does not
require COMS.
Sec. 63.8(c)(6)-(c)(8)....... Yes.............. Provisions for COMS
are not applicable.
Sec. 63.8(d)-(f)............. Yes.
Sec. 63.8(g)................. No............... Subpart KK specifies
CMS data reduction
requirements.
Sec. 63.9(a)................. Yes.
Sec. 63.9(b)(1).............. Yes.
Sec. 63.9(b)(2).............. Yes.............. Initial notification
submission date
extended.
Sec. 63.9(b)(3)-(b)(5)....... Yes.
Sec. 63.9(c)-(e)............. Yes.
Sec. 63.9(f)................. No............... Subpart KK does not
require opacity and
visible emissions
observations.
Sec. 63.9(g)................. Yes.............. Provisions for COMS
are not applicable.
Sec. 63.9(h)(1)-(h)(3)....... Yes.
Sec. 63.9(h)(4).............. No............... Section reserved.
Sec. 63.9(h)(5)-(h)(6)....... Yes.
Sec. 63.9(i)................. Yes.
Sec. 63.9(j)................. Yes.
Sec. 63.10(a)................ Yes.
Sec. 63.10(b)(1)-(b)(3)...... Yes.
Sec. 63.10(c)(1)............. Yes.
Sec. 63.10(c)(2)-(c)(4)...... No............... Sections reserved.
Sec. 63.10(c)(5)-(c)(8)...... Yes.
Sec. 63.10(c)(9)............. No............... Section reserved.
Sec. 63.10(c)(10)-(c)(15).... Yes.
Sec. 63.10(d)(1)-(d)(2)...... Yes.
Sec. 63.10(d)(3)............. No............... Subpart KK does not
require opacity and
visible emissions
observations.
Sec. 63.10(d)(4)-(d)(5)...... Yes.
Sec. 63.10(e)................ Yes.............. Provisions for COMS
are not applicable.
Sec. 63.10(f)................ Yes.
Sec. 63.11................... No............... Subpart KK specifies
the use of solvent
recovery devices or
oxidizers.
Sec. 63.12................... Yes.
Sec. 63.13................... Yes.
Sec. 63.14................... Yes.
Sec. 63.15................... Yes.
------------------------------------------------------------------------
[[Page 27156]]
Appendix A to Subpart KK--Data Quality Objective and Lower Confidence
Limit Approaches for Alternative Capture Efficiency Protocols and Test
Methods
1. Introduction
1.1 Alternative capture efficiency (CE) protocols and test
methods that satisfy the criteria of either the data quality
objective (DQO) approach or the lower confidence limit (LCL)
approach are acceptable under Sec. 63.827(f). The general criteria
for alternative CE protocols and test methods to qualify under
either the DQO or LCL approach are described in section 2. The DQO
approach and criteria specific to the DQO approach are described in
section 3. The LCL approach and criteria specific to the LCL
approach are described in section 4. The recommended reporting for
alternative CE protocols and test methods are presented in section
5. The recommended recordkeeping for alternative CE protocols and
test methods are presented in section 6.
1.2 Although the Procedures L, G.1, G.2, F.1, and F.2 in
Sec. 52.741 of part 52 were developed for TTE and BE testing, the
same procedures can also be used in an alternative CE protocol. For
example, a traditional liquid/gas mass balance CE protocol could
employ Procedure L to measure liquid VOC input and Procedure G.1 to
measure captured VOC.
2. General Criteria for DQO and LCL Approaches
2.1 The following general criteria must be met for an
alternative capture efficiency protocol and test methods to qualify
under the DQO or LCL approach.
2.2 An alternative CE protocol must consist of at least three
valid test runs. Each test run must be at least 20 minutes long. No
test run can be longer than 24 hours.
2.3 All test runs must be separate and independent. For
example, liquid VOC input and output must be determined
independently for each run. The final liquid VOC sample from one run
cannot be the initial sample for another run. In addition, liquid
input for an entire day cannot be apportioned among test runs based
on production.
2.4 Composite liquid samples cannot be used to obtain an
``average composition'' for a test run. For example, separate
initial and final coating samples must be taken and analyzed for
each run; initial and final samples cannot be combined prior to
analysis to derive an ``average composition'' for the test run.
2.5 All individual test runs that result in a CE of greater
than 105 percent are invalid and must be discarded.
2.6 If the source can demonstrate to the regulatory agency that
a test run should not be considered due to an identified testing or
analysis error such as spillage of part of the sample during
shipping or an upset or improper operating conditions that is not
considered part of normal operation then the test result for that
individual test run may be discarded. This limited exception allows
sources to discard as ``outliers'' certain individual test runs
without replacing them with a valid test run as long as the facility
has at least three valid test runs to use when calculating its DQO
or LCL. This exception is limited solely to test runs involving the
types of errors identified above.
2.7 All valid test runs that are conducted must be included in
the average CE determination. The individual test run CE results and
average CE results cannot be truncated (i.e., 105 percent cannot be
reported as 100+ percent) for purposes of meeting general or
specific criteria for either the DQO or the LCL. If the DQO is
satisfied and the average CE is greater than 100, then 100 percent
CE must be considered the result of the test.
2.8 Alternative test methods for measuring VOC concentration
must include a three-point calibration of the gas analysis
instrument in the expected concentration range.
3. Data Quality Objective Approach
3.1 The purpose of the DQO is to allow sources to use
alternative CE protocols and test methods while ensuring reasonable
precision consistent with pertinent requirements of the Clean Air
Act. In addition to the general criteria described in section 2, the
specific DQO criterion is that the width of the two-sided 95 percent
confidence interval of the mean measured value must be less than or
equal to 10 percent of the mean measured value (see Figure 1). This
ensures that 95 percent of the time, when the DQO is met, the actual
CE value will be 5 percent of the mean measured value
(assuming that the test protocol is unbiased).
[GRAPHIC] [TIFF OMITTED] TR30MY96.021
3.2 The DQO calculation is made as follows using Equations 1
and 2:
[GRAPHIC] [TIFF OMITTED] TR30MY96.022
[GRAPHIC] [TIFF OMITTED] TR30MY96.023
Where:
a=distance from the average measured CE value to the endpoints of
the 95-percent (two-sided) confidence interval for the measured
value.
n=number of valid test runs.
P=DQO indicator statistic, distance from the average measured CE
value to the endpoints of the 95-percent (two-sided) confidence
interval, expressed as a percent of the average measured CE value.
s=sample standard deviation.
t0.975=t-value at the 95-percent confidence level (see Table
1).
xavg=average measured CE value (calculated from all valid test
runs).
xi=the CE value calculated from the ith test run.
[[Page 27157]]
Number of
Number of valid test runs, n t0.975 t0.90 valid test t0.975 t0.90
runs, n
1 or 2......................................... N/A N/A 12 2.201 1.363
3.............................................. 4.303 1.886 13 2.179 1.356
4.............................................. 3.182 1.638 14 2.160 1.350
5.............................................. 2.776 1.533 15 2.145 1.345
6.............................................. 2.571 1.476 16 2.131 1.341
7.............................................. 2.447 1.440 17 2.120 1.337
8.............................................. 2.365 1.415 18 2.110 1.333
9.............................................. 2.306 1.397 19 2.101 1.330
10............................................. 2.262 1.383 20 2.093 1.328
1.............................................. 12.228 1.372 21 2.086 1.325
Table 1.--T-Values
3.3 The sample standard deviation and average CE value are
calculated using Equations 3 and 4 as follows:
[GRAPHIC] [TIFF OMITTED] TR30MY96.024
[GRAPHIC] [TIFF OMITTED] TR30MY96.025
3.4 The DQO criteria are achieved when all of the general
criteria in section 2 are achieved and P 5 percent (i.e.,
the specific DQO criterion is achieved). In order to meet this
objective, facilities may have to conduct more than three test runs.
Examples of calculating P, given a finite number of test runs, are
shown below. (For purposes of this example it is assumed that all of
the general criteria are met.)
3.5 Facility A conducted a CE test using a traditional liquid/
gas mass balance and submitted the following results and the
calculations shown in Equations 5 and 6:
------------------------------------------------------------------------
Run CE
------------------------------------------------------------------------
1.............................................................. 96.1
2.............................................................. 105.0
3.............................................................. 101.2
------------------------------------------------------------------------
Therefore:
n=3
t0.975=4.30
xavg=100.8
s=4.51
[GRAPHIC] [TIFF OMITTED] TR30MY96.026
[[Page 27158]]
[GRAPHIC] [TIFF OMITTED] TR30MY96.027
3.6 Since the facility did not meet the specific DQO criterion,
they ran three more test runs.
------------------------------------------------------------------------
Run CE
------------------------------------------------------------------------
4.............................................................. 93.2
5.............................................................. 96.2
6.............................................................. 87.6
------------------------------------------------------------------------
3.7 The calculations for Runs 1-6 are made as follows using
Equations 7 and 8:
n=6
t0.975=2.57
xavg=96.6
s=6.11
[GRAPHIC] [TIFF OMITTED] TR30MY96.028
[GRAPHIC] [TIFF OMITTED] TR30MY96.029
3.8 The facility still did not meet the specific DQO criterion.
They ran three more test runs with the following results:
------------------------------------------------------------------------
Run CE
------------------------------------------------------------------------
7.............................................................. 92.9
8.............................................................. 98.3
9.............................................................. 91.0
------------------------------------------------------------------------
3.9 The calculations for Runs 1-9 are made as follows using
Equations 9 and 10:
n=9
t0.975=2.31
xavg=95.7
s=5.33
[GRAPHIC] [TIFF OMITTED] TR30MY96.030
[GRAPHIC] [TIFF OMITTED] TR30MY96.031
3.10 Based on these results, the specific DQO criterion is
satisfied. Since all of the general criteria were also satisfied,
the average CE from the nine test runs can be used to determine
compliance.
4. Lower Confidence Limit Approach
4.1 The purpose of the LCL approach is to provide sources, that
may be performing much better than their applicable regulatory
requirement, a screening option by which they can demonstrate
compliance. The approach uses less precise methods and avoids
additional test runs which might otherwise be needed to meet the
specific DQO criterion while still being assured of correctly
demonstrating compliance. It is designed to reduce ``false
positive'' or so called ``Type II errors'' which may erroneously
indicate compliance where more variable test methods are employed.
Because it encourages CE performance greater than that required in
exchange for reduced compliance demonstration burden, the sources
that successfully use the LCL approach could produce emission
reductions beyond allowable emissions. Thus, it could provide
additional benefits to the environment as well.
4.2 The LCL approach compares the 80 percent (two-sided) LCL
for the mean measured CE value to the applicable CE regulatory
requirement. In addition to the general criteria described in
section 2, the specific LCL criteria are that either the LCL be
greater than or equal to the applicable CE regulatory requirement or
that the specific DQO criterion is met. A more detailed description
of the LCL approach follows:
4.3 A source conducts an initial series of at least three runs.
The owner or operator may choose to conduct additional test runs
during the initial test if desired.
4.4 If all of the general criteria are met and the specific DQO
criterion is met, then the average CE value is used to determine
compliance.
4.5 If the data meet all of the general criteria, but do not
meet the specific DQO criterion; and the average CE, using all valid
test runs, is above 100 percent then the test sequence cannot be
used to calculate the LCL. At this point the facility has the option
of (a) conducting more test runs in hopes of meeting the DQO or of
bringing the average CE for all test runs below 100 percent so the
LCL can be used or (b) discarding all previous test data and
retesting.
4.6 The purpose of the requirement in Section 4.5 is to protect
against protocols and test methods which may be inherently biased
high. This is important because it is impossible to have an actual
CE greater than 100 percent and the LCL approach only looks at the
lower end variability of the test results. This is different from
the DQO which allows average CE values up to 105 percent because the
DQO sets both upper and lower limits on test variability.
4.7 If at any point during testing the results meet the DQO,
the average CE can be used for demonstrating compliance with the
applicable regulatory requirement. Similarly, if the average CE is
below 100 percent then the LCL can be used for demonstrating
compliance with the applicable regulatory requirement without regard
to the DQO.
4.8 The LCL is calculated at a 80 percent (two-sided)
confidence level as follows using Equation 11:
[GRAPHIC] [TIFF OMITTED] TR30MY96.032
Where:
LC1=LCL at a 80 percent (two-sided) confidence level.
n=number of valid test runs.
s=sample standard deviation.
t0.90=t-value at the 80-percent (two-sided) confidence level
(see Table 3-1).
xavg=average measured CE value (calculated from all valid test
runs).
4.9 The resulting LC1 is compared to the applicable CE
regulatory requirement. If LC1 exceeds (i.e., is higher than)
the applicable regulatory requirement, then a facility is in initial
compliance. However, if the LC1 is below the CE requirement,
then the facility must conduct additional test runs. After this
point the test results will be evaluated not only looking at the
LCL, but also the DQO of 5 percent of the mean at a 95
percent confidence level. If the test results with the additional
test runs meet the DQO before the LCL exceeds the applicable CE
regulatory requirement, then the average CE value will be compared
to the applicable CE regulatory requirement for determination of
compliance.
4.10 If there is no specific CE requirement in the applicable
regulation, then the applicable CE regulatory requirement is
determined based on the applicable regulation and an acceptable
destruction efficiency test. If the applicable regulation requires
daily compliance and the latest CE compliance demonstration was made
using the LCL approach, then the calculated LC1 will be the
highest CE value which a facility is allowed to claim until another
CE demonstration test is conducted. This last requirement is
necessary to assure both sufficiently reliable test results in all
circumstances and the potential environmental benefits referenced
above.
4.11 An example of calculating the LCL is shown below. Facility
B's applicable regulatory requirement is 85 percent CE. Facility B
conducted a CE test using a traditional liquid/gas mass balance and
submitted the following results and the calculation shown in
Equation 12:
------------------------------------------------------------------------
Run CE
------------------------------------------------------------------------
1.............................................................. 94.2
2.............................................................. 97.6
3.............................................................. 90.5
------------------------------------------------------------------------
Therefore:
n=3
t0.90=1.886
xavg=94.1
s=3.55
[GRAPHIC] [TIFF OMITTED] TR30MY96.033
[[Page 27159]]
4.12 Since the LC1 of 90.23 percent is above the
applicable regulatory requirement of 85 percent then the facility is
in compliance. The facility must continue to accept the LC1 of
90.23 percent as its CE value until a new series of valid tests is
conducted. (The data generated by Facility B do not meet the
specific DQO criterion.)
5. Recommended Reporting for Alternative CE Protocols
5.1 If a facility chooses to use alternative CE protocols and
test methods that satisfy either the DQO or LCL and the additional
criteria in section 4., the following information should be
submitted with each test report to the appropriate regulatory
agency:
1. A copy of all alternative test methods, including any changes
to the EPA reference methods, QA/QC procedures and calibration
procedures.
2. A table with information on each liquid sample, including the
sample identification, where and when the sample was taken, and the
VOC content of the sample;
3. The coating usage for each test run (for protocols in which
the liquid VOC input is to be determined);
4. The quantity of captured VOC measured for each test run;
5. The CE calculations and results for each test run;
6. The DQO or LCL calculations and results; and
7. The QA/QC results, including information on calibrations
(e.g., how often the instruments were calibrated, the calibration
results, and information on calibration gases, if applicable).
6. Recommended Recordkeeping for Alternative CE Protocols.
6.1 A record should be kept at the facility of all raw data
recorded during the test in a suitable form for submittal to the
appropriate regulatory authority upon request.
[FR Doc. 96-13084 Filed 5-29-96; 8:45 am]
BILLING CODE 6560-50-P
Complete official Federal Register PDF
FR Doc. 96-12955 Revision of Miscellaneous Hazardous Materials Regulations; Regulatory Review
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27166-27176]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12955]
[[Page 27165]]
_______________________________________________________________________
Part IV
Department of Transportation
_______________________________________________________________________
Research and Special Programs Administration
49 CFR Parts 171, 172, 173, etc.
Revision of Miscellaneous Hazardous Materials Regulations; Regulatory
Review; Final Rule
Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / Rules
and Regulations
[[Page 27166]]
DEPARTMENT OF TRANSPORTATION
Research and Special Programs Administration
49 CFR Parts 171, 172, 173, 176, 177, 178, and 180
[Docket HM-222B; Amdt. Nos. 171-145, 172-149, 173-253, 176-40, 177-87,
178-116, and 180-9]
RIN 2137-AC76
Revision of Miscellaneous Hazardous Materials Regulations;
Regulatory Review
AGENCY: Research and Special Programs Administration (RSPA), DOT.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: RSPA is amending the Hazardous Materials Regulations (HMR)
based on its review of the HMR and on written and oral comments
received from the public concerning regulatory reform. The intended
effect of this rulemaking is to reduce unnecessary regulatory burdens
on industry and make the regulations shorter and easier to use without
compromising public safety. In particular, RSPA is reducing the
requirements pertaining to training frequency, incident reporting, and
emergency response telephone numbers. This action is in response to
President Clinton's March 4, 1995 memorandum to heads of departments
and agencies calling for a review of all agency regulations.
DATES: Effective date. October 1, 1996.
Compliance date. Immediate compliance is authorized.
Incorporation by reference. The incorporation by reference of a
publication listed in this amendment is approved by the Director of the
Federal Register as of October 1, 1996.
FOR FURTHER INFORMATION CONTACT: John A. Gale, (202) 366-8553; Office
of Hazardous Materials Standards, or Karin V. Christian, (202) 366-
4400, Office of the Chief Counsel, RSPA, Department of Transportation,
Washington, DC 20590-0001.
SUPPLEMENTARY INFORMATION:
I. Background
On March 4, 1995, President Clinton issued a memorandum to heads of
departments and agencies calling for a review of all agency regulations
and elimination or revision of those regulations that are outdated or
in need of reform. In response to the President's directive, RSPA
performed an extensive review of the Hazardous Materials Regulations
(HMR; 49 CFR Parts 171-180) and associated procedural rules (49 CFR
Parts 106 and 107).
The President also directed that front line regulators ``* * * get
out of Washington and create grassroots partnerships'' with people
affected by agency regulations. On April 4, 1995, RSPA published in the
Federal Register (60 FR 17049) a notice announcing seven public
meetings and requesting comments on its hazardous materials safety
program. RSPA requested comments on ways to improve the HMR and the
kind and quality of services its customers want. RSPA received over 50
written comments in response to the notice. On July 28, 1995, RSPA
published a second notice (60 FR 38888) announcing five more public
meetings that were held between September 1995 and January 1996.
On February 20, 1996, RSPA published a Notice of Proposed
Rulemaking (NPRM) (61 FR 6478) under Docket HM-222B that proposed to
amend various sections of the HMR based on agency initiative and on
written and oral comments received from the public on regulatory
reform. In particular, RSPA proposed to reduce the requirements
pertaining to training frequency, incident reporting, and emergency
response telephone numbers.
II. Summary of Amendments
RSPA received approximately 90 comments to the NPRM. Most of the
comments supported the proposals and requested that RSPA adopt them as
soon as possible. The commenters, including many small businesses,
stated that they would benefit directly from the adoption of the
proposal in Docket HM-222B without any reduction of safety. Several
commenters commended RSPA's commitment to effecting meaningful
regulatory reform. Some commenters, however, did raise concerns about
the impact on safety if these proposals were adopted. Commenters also
raised issues that were beyond the scope of the proposed rule; however,
these issues may be considered in future rulemakings.
RSPA believes that the amendments adopted in this final rule strike
a balance between safety and costs imposed on the regulated community.
RSPA does not believe that the result of the amendments in this final
rule will be a decrease in safety to the public or the environment.
Part 171
Section 171.16. In the NPRM, RSPA proposed, except for materials
transported by aircraft, to except limited quantities of Packing Group
II and III materials from the incident reporting requirements in
Sec. 171.16. RSPA stated in the NPRM that continued reporting of
certain incidents involving limited quantities would be of minimal
value when weighed against the burden on the carriers required to
prepare incident reports.
RSPA received a number of comments on the proposal to revise the
incident reporting requirements. Most of the commenters supported the
proposal and cited the cost savings to the regulated community without
any decrease in safety. Some commenters did not agree with the proposal
and stated that large numbers of limited quantity packages could cause
a serious incident to occur. Others requested that the proposal be
modified to except only that material which can be controlled in the
immediate release area. RSPA believes that the continued reporting of
incidents involving these materials is of minimal value when weighed
against the burden placed on carriers who are required to prepare and
submit incident reports. In addition, if a large number of limited
quantity packages causes a serious incident to occur that meets a
criterion in Sec. 171.15, a written report is still required.
Therefore, RSPA is adopting this amendment as proposed.
Part 172
Section 172.101. As proposed, RSPA is amending the Sec. 172.101
Table for the entries ``Cartridges for weapons, blank, or Cartridges,
small arms, blank, UN 0014''; ``Cartridges for weapons, inert
projectile, or Cartridges, small arms, UN0012''; ``Cartridges, power
device, UN0323''; and ``Cartridges, small arms'', in Column (7), by
removing the reference ``112''. Also for these entries, in Column (8A)
of the Sec. 172.101 Table, the word ``None'' or ``230'', as
appropriate, is removed and replaced with ``63''. The provisions to
reclass an explosive as an ORM-D material, currently contained in
Special Provision 112 and in Sec. 173.230(b), are relocated to
Sec. 173.63(b) to minimize confusion.
RSPA is also amending, as proposed, Column (7) of the Sec. 172.101
Table for the entry ``Ethanol or Ethyl alcohol or Ethanol solutions or
Ethyl alcohol solutions'' by adding Special Provision ``24'' to allow
ethanol the same packing group criteria as alcoholic beverages.
In this final rule, RSPA is also making some minor changes to the
headings of some of the columns of the Hazardous Materials Table. The
headings for columns (8), (8B) and (8C) are revised to read ``Packaging
(Sec. 173.***)'', ``Nonbulk'', and ``Bulk'', respectively. The headings
for column (9A), (10), (10A) and (10B) are revised to read ``Passenger
aircraft/rail'', ``Vessel; Stowage'', ``Location'', and ``Other'',
respectively. These changes will make
[[Page 27167]]
the headings more descriptive of the referenced requirements therein
and will also decrease the size of the Hazardous Materials Table.
Section 172.102. As proposed, RSPA is removing Special Provision
112.
Section 172.201. As proposed, RSPA is amending Sec. 172.201(d) by
adding a cross-reference to Sec. 172.604(c).
Sections 171.11, 172.203 and 172.324. Currently, all constituents
in a mixture or solution that meet the definition of ``hazardous
substance'' in Sec. 171.8 must be identified on shipping papers and
package markings. In the NPRM, RSPA proposed to require that at least
two hazardous substances be identified on shipping papers and package
markings for hazardous materials containing two or more hazardous
substances. This proposal is consistent with the technical name
requirements in Sec. 172.203(k).
RSPA received several comments in support of this proposed change.
Commenters stated these changes would facilitate overall compliance.
Some commenters who supported the proposal requested that RSPA provide
guidance on which hazardous substances should be identified. A
commenter opposed to the change stated that the Environmental
Protection Agency (EPA) requires that persons who have custody of
hazardous substances report the release of every constituent hazardous
substance for these materials.
RSPA does not believe that requiring only two constituent hazardous
substances to be identified on shipping papers and package markings
will cause persons to be in violation of the EPA's reporting
requirements in 40 CFR 302.6. However, in response to the comments,
RSPA is not adopting the rule as proposed but is modifying the proposal
to require identification of those hazardous substances with the lowest
reportable quantities (RQ). For release of mixtures or solutions,
including hazardous wastes, where the amount of the mixture or solution
is unknown, a person is required under 40 CFR 302.6, to report to the
National Response Center (NRC) when the amount of the mixture or
solution equals or exceeds the lowest RQ. Therefore, if the two
materials with the lowest RQs are identified, a carrier will have
sufficient information to satisfy the reporting requirements of the EPA
under 40 CFR 302.6. In addition, RSPA is revising Sec. 171.11(d)(1) to
be consistent with the changes in Secs. 172.203 and 172.324.
RSPA also proposed to remove paragraph (e)(3) to eliminate the
requirement to include the statement ``RESIDUE: Last Contained * * *''
on shipping papers for a shipping description of packages containing
only the residue of a hazardous substance. Many commenters
misunderstood the proposal as also removing the requirement to enter
the statement ``RESIDUE: Last Contained * * *'' before the shipping
description for a tank car which contains the residue of a hazardous
substance. This is not the case. The shipping description for a tank
car that contains the residue of a hazardous material, including a
hazardous substance, is required by Sec. 172.203(e)(2) to be prefaced
with the statement ``RESIDUE: Last Contained * * *''. The removal of
Sec. 172.203(e)(3) eliminates the requirement to preface the shipping
description of a residue of a hazardous substance in a package other
than a tank car (e.g., drum or cargo tank) with the statement
``RESIDUE: Last Contained * * *.''
Section 172.316. Based on a comment received under Docket HM-222,
RSPA proposed to modify Sec. 172.316 to allow the CLASS 9 label in
place of the ORM-D marking on packages of consumer commodities. RSPA
received only two comments on this proposal, both opposing it. One of
the comments was submitted by the commenter who had suggested the
revision. Since the commenter originally requesting the revision
believes the change would cause unnecessary confusion and would require
the retraining of numerous employees with minimal benefit, RSPA is not
adopting the proposal to allow the CLASS 9 label in place of the ORM-D
marking.
Section 172.402. As proposed, RSPA is revising Sec. 172.402 by
adding an exception from the requirement for subsidiary hazard labeling
for certain packages of Class 7 (radioactive) materials that also meet
the definition of another hazard class, except Class 9. These Class 7
materials conform to all requirements in Sec. 173.4, except for their
specific activity level, which exceeds permissible limits for a limited
quantity radioactive material.
Section 172.500. As proposed, RSPA is amending this section by
adding a new paragraph (b)(4) to clarify that small quantities of
hazardous materials prepared in accordance with Sec. 173.13 are
excepted from the placarding requirements of Subpart F of Part 172.
Section 172.600. As proposed, RSPA is excepting all ORM-D material
from the emergency response information and telephone number
requirements of Subpart G of Part 172, even when offered for
transportation or transported by aircraft.
Section 172.604. Based on its own initiative and petitions for
rulemaking, and because of the belief that the costs to implement these
requirements outweigh the benefits, RSPA proposed to except the
following materials from emergency response telephone number
requirements: (1) Liquid petroleum distillate fuels (e.g., gasoline,
propane, and diesel fuel); (2) limited quantities of hazardous
materials; and (3) materials described under the shipping names
``Engines, internal combustion''; ``Battery powered equipment'';
``Battery powered vehicle''; ``Wheelchair, electric''; ``Carbon
dioxide, solid''; ``Dry ice''; ``Fish meal, stabilized''; ``Fish scrap,
stabilized''; ``Castor bean''; ``Castor meal''; ``Castor flake'';
``Castor pomace''; and ``Refrigerating machine''.
RSPA received numerous comments opposing the proposal to except
liquid petroleum distillate fuels from the 24-hour emergency response
telephone number requirement. Commenters opposing the proposed
exception included: emergency responders, petroleum transporters, trade
associations, State and local agencies, environmental contractors and
consultants, and a railroad association. These commenters stated that
the benefits of retaining the 24-hour telephone number for liquid
petroleum distillate fuels outweigh the costs. Commenters stated that
the 24-hour telephone number enables emergency responders to
immediately contact the parties involved to arrange for clean-up of a
spill. A commenter stated that information on the composition of a
particular gasoline may be available only from the shipper through the
emergency response telephone number. Other commenters stated that many
gasolines contain ethyl alcohol, methyl alcohol or other oxygenating
components that traditional firefighting foams are considerably less
effective on than are alcohol foams. Commenters also stated that many
small fire departments have never handled a major spill involving large
volumes of gasoline or propane. The commenters stated that responders
need every resource available to them in the event of a hazardous
materials spill.
RSPA received several comments from businesses and trade
organizations in favor of the proposal to except liquid petroleum
distillate fuels from the 24-hour emergency response telephone number
requirement. The commenters agreed with RSPA's statement in the NPRM
that emergency responders routinely handle incidents involving liquid
petroleum distillate fuels and that it is questionable whether the 24-
hour emergency response telephone number could provide emergency
responders with any additional information of value beyond that which
is required to be carried in the vehicle.
[[Page 27168]]
RSPA received few comments on the proposal to except limited
quantities, and other miscellaneous materials, from the 24-hour
telephone number requirement. Those in favor of the proposal cited the
high costs associated with providing an emergency response telephone
number against the minimal hazards associated with such small
quantities of material. One commenter stated that the exception for the
emergency response telephone number for hazardous materials in limited
quantities will provide the regulated community with significant relief
while not sacrificing safety. Those opposing the proposal stated that
since limited quantities of materials are already excepted from other
hazard communication requirements, e.g., labeling, that emergency
responders are already hampered when responding to an incident
involving these materials and that excepting them from the emergency
response telephone number would only create more problems for
responders.
RSPA believes that providing emergency response information to
emergency responders is an important aspect of its hazardous materials
safety program. Emergency response information enhances communication
pertaining to the safe handling and identification of hazardous
materials involved in transportation incidents. The intent of the NPRM
was to relax the emergency response information requirements for those
materials where the costs to maintain the information were believed to
outweigh the benefits derived from providing the information. Based on
the comments received opposing the proposal to except liquid petroleum
distillate fuels from the 24-hour emergency response telephone number
requirement, RSPA has decided not to adopt the proposed exception for
liquid petroleum distillate fuels. Commenters stated that the costs to
maintain the 24-hour emergency response telephone number for liquid
petroleum distillate fuels do not outweigh the benefits and, therefore,
the requirement should be retained. As expressed by one commenter, a
propane distributor who would have directly benefited from the
exception, the cost to maintain a 24-hour emergency telephone number is
minimal and the cost poses no real financial burden, especially
considering the safety of emergency response personnel, the public, and
the environment.
With regard to the proposed exception for limited quantities,
consumer commodities transported by aircraft, and other miscellaneous
materials, RSPA continues to believe that the costs to maintain a 24-
hour emergency response telephone number outweigh the benefits of
providing the information for millions of small shipments. However,
RSPA believes that the impact on air transportation safety of excepting
``Mercury contained in manufactured articles'' from the 24-hour
emergency response telephone number requirement requires further study.
Therefore, except for ``Mercury contained in manufactured articles'',
RSPA is adopting an exception from the emergency response telephone
number requirements of Sec. 172.604 for limited quantities, consumer
commodities transported by aircraft, and other miscellaneous materials.
Based on its own initiative, RSPA proposed to clarify that more
than one emergency response telephone number with different hours of
operation may be used to satisfy the requirements of Sec. 172.604. RSPA
received numerous comments both in support of and against the proposed
clarification. RSPA believes that the issues raised by the commenters
need further review and will finalize its decision on this proposal in
a future rulemaking. Therefore, in the interim, multiple emergency
response phone numbers are authorized on a shipping paper if the
requirements of Sec. 172.604 are met.
Sections 172.702 and 172.704. RSPA stated in the notice of public
meetings under Docket HM-222 (60 FR 17049) that it would consider
extending the requirement for recurrent training from every two years
to every three or four years. RSPA received numerous written and oral
comments in support of decreasing the frequency specified to retrain
hazmat employees in accordance with Subpart H of Part 172. In the NPRM,
RSPA proposed to decrease the frequency of recurrent hazmat training
from two years to three years. RSPA stated that this frequency is
consistent with other training programs, such as the training required
under the Transportation of Dangerous Goods Regulations issued by the
government of Canada.
RSPA received numerous comments in support of this proposal and
many comments in opposition. Commenters supporting the proposal
included: shippers, carriers, safety and trade associations, oil and
petrochemical companies and associations, a railroad association. Some
commenters requested that RSPA extend the training to every four years.
The commenters stated that the amendment would significantly reduce
costs to the regulated community without any decrease in safety.
Commenters who supported the proposal to extend the training frequency
requirements to every three years stated that the change would allow
hazmat employers to provide for more cost-effective training of hazmat
employees, since training times could be better coordinated to
accommodate employee work schedules and varying business cycles. Some
commenters who supported the proposal stated that extending the
training frequency is consistent with other regulatory requirements
(e.g., Canadian regulations). One commenter noted that, although
international regulations require training on a two-year cycle,
inclusion of the phrase ``at least'' enables persons involved in
international transportation to comply with both requirements without
any conflict or confusion. Commenters also stated that if RSPA adopts a
change to the training frequency requirements, then a corresponding
change to the recordkeeping requirements is also necessary.
Those commenters who opposed the proposed change in training
frequency included: trade and service associations, training and
consulting organizations, shippers and carriers, and emergency response
organizations. These commenters stated that the proposal to increase
the training frequency would have a detrimental impact on safety. Some
commenters also stated that the proposal will diminish the apparent
importance of the DOT program in the eyes of employees and supervisors.
RSPA believes that one of the most important regulatory
requirements in the HMR is its training requirement. Proper training
increases a hazmat employee's awareness of safety considerations
involved in the loading, unloading, handling, storing, and
transportation of hazardous materials. An effective training program
reduces hazardous materials incidents resulting from human error and
mitigates the effects of incidents when they occur. The importance of
RSPA's training requirements is not diminished by a decrease in the
frequency of training from two to three years. However, RSPA is not
adopting commenter suggestions to extend the training frequency to
every four years. The adoption of a three-year interval for training
frequency strikes a balance between an effective training program and
the costs that are imposed on the regulated community. Therefore, RSPA
is revising the training frequency for hazmat employees from every two
years to every three years. In addition, as requested by commenters,
RSPA is adjusting the recordkeeping requirements for training records
to specify that training records be retained for three years.
[[Page 27169]]
In the preamble to the NPRM, RSPA stated: ``Except as provided in
Sec. 172.704(c), hazmat employees must be trained whenever their hazmat
functions change or the requirements are revised, regardless of the
minimally required training frequency.'' A number of commenters were
concerned with this statement because they did not see any
corresponding proposed change to the HMR. Some commenters also
expressed concern with the statement that hazmat employees must be
retrained every time a change to the HMR is adopted because it could
require retraining several times a year.
Section 172.702 (Subpart H) states that any person who performs a
function subject to the HMR may not perform that function unless
trained in accordance with the requirements prescribed in the subpart.
In addition, a hazmat employer must insure that each hazmat employee is
thoroughly instructed in the requirements that apply to functions
performed by that employee. If a new regulation is adopted, or an
existing regulation is changed, that relates to a function performed by
a hazmat employee, that hazmat employee must be instructed in those new
or revised function specific requirements without regard to the timing
of the three year training cycle. It is not necessary to completely
retrain the employee sooner than the required three year cycle. The
only instruction required is that necessary to assure knowledge of the
new or revised regulatory requirement. For example, if a new
requirement is added to the shipping paper requirements, a hazmat
employee must be instructed regarding the new requirement prior to
performance of a function affected by the new or revised rule. It is
not necessary to test the hazmat employee, or retain records of the
instruction provided in the new or revised requirements until the next
scheduled retraining at or within the three year cycle. In order to
clarify the training requirements of the HMR, RSPA is revising
Sec. 172.702(b) to state that an employee must be instructed in the
requirements of the HMR that apply to each function performed by the
employee without a reference to the requirements of subpart H (e.g.,
the training, testing and recordkeeping requirements of Sec. 172.704).
This amendment makes it clear that RSPA does not intend that millions
of detailed records be created and retained and associated testing be
conducted each time a hazmat employee is instructed in regard to a
change in the regulations within the three year cycle. Consistent with
this amendment, RSPA is also revising Sec. 172.704(d) to clarify that
only records of the training required by Sec. 172.704, and not the
subpart, are required to be maintained. In addition, as proposed, RSPA
is adding a reference in Sec. 172.702(b) to the exception provided in
Sec. 172.704 for employees employed less than 90-days.
RSPA proposed to revise Sec. 172.704(c) to clarify its position
concerning the ``direct'' supervision of a hazmat employee who has not
received initial training. RSPA is adopting the amendment, as proposed
in the NPRM, to add the word ``direct'' preceding the word
``supervision'' in Sec. 172.704(c)(1). RSPA requires that the person
providing direct supervision must be able to instruct the employee on
how to properly perform the hazmat function, must observe performance
of the hazmat function, and must be able to take immediate corrective
actions in regard to any function not performed in conformance with the
HMR.
Part 173
Section 173.4. As proposed, RSPA is revising the HMR to permit
Division 4.2 and 4.3 materials and hazardous materials identified in
paragraph (a)(11) to be shipped under the small quantity provisions.
RSPA is also adding a new paragraph (c) to allow small quantities of
certain categories of hazardous materials not authorized under this
exception to be shipped in accordance with this section if specifically
approved by the Associate Administrator for Hazardous Materials Safety.
RSPA is also revising the marking requirements in paragraph (a)(10).
These changes to Sec. 173.4 are intended to ease burdens on industry
and facilitate international transportation of hazardous materials in
very small quantities. RSPA received several comments in support of
these amendments. One commenter requested that RSPA continue to
authorize the previously required marking. RSPA agrees and has modified
the amendment to authorize the previously required marking for an
additional five years.
Section 173.13. In the NPRM, RSPA proposed to add a new Sec. 173.13
that incorporates, for highway and rail transport only, the provisions
of DOT exemptions E-7891 and E-9168 into the HMR. These exemptions, and
others commonly referred to as the ``poison pack'' exemptions, allow
small quantities of hazardous materials in special packagings of high
integrity to be transported without their primary or subsidiary labels.
In addition, RSPA proposed to except these materials from the
placarding and segregation requirements of the HMR.
RSPA received several comments on this issue in support of adopting
these exemptions into the HMR, but the commenters also requested
further clarification. Two commenters noted that one of the inner
packagings required by the exemptions was not included in the proposed
new section. Commenters also requested that the section be broadened to
include air transport and materials poisonous by inhalation, as
presently authorized in the exemptions. Commenters also requested that
the term ``rigid can'' be clarified and that all affected exemptions be
identified.
Commenters who opposed adoption of this new section were concerned
about the loss of controls that are provided under an exemption. In
addition, commenters were concerned that there would be no clear
identification on the package that the package is being offered for
transportation or transported under the provisions of Sec. 173.13.
RSPA believes that the safety record of the ``poison pack''
exemption packagings over the years has shown that they are acceptable
for inclusion in the HMR. However, several points of clarification and
revision to the proposal are necessary. First, RSPA is extending the
application of Sec. 173.13 to permit transportation by cargo aircraft.
RSPA will continue to monitor the transportation of these packages with
materials poisonous by inhalation and by passenger carrying aircraft
under the terms of the exemption, and therefore, is not extending the
application of the new section to cover these operations. These
operations can continue under the applicable exemptions. RSPA is also
requiring another level of inner packaging to be consistent with the
exemptions. In order to clarify the term ``rigid can'', RSPA is
changing the term to ``metal can.''
RSPA agrees with commenters who were concerned that packages
prepared in accordance with Sec. 173.13 would not be readily
identifiable in transportation. Therefore, RSPA is adopting in this
final rule a marking requirement similar to that required for small
quantities prepared in accordance with Sec. 173.4. Packages prepared in
accordance with Sec. 173.13 must be marked, in association with the
proper shipping name, with the following statement: ``This package
conforms to 49 CFR 173.13.''
One commenter was concerned that no specific exception from the
segregation requirements was proposed in the section, as is provided in
the exemptions. RSPA notes that the
[[Page 27170]]
segregation requirements of the HMR are based on package labels.
Therefore, materials that are excepted from the labeling requirements
of the HMR are also excepted from the segregation requirements of the
HMR. For clarification, RSPA is revising Secs. 172.500 and 173.13 to
note that packages conforming to the requirements in Sec. 173.13 are
excepted from the placarding requirements of the HMR.
Commenters requested that RSPA identify all of the exemptions
potentially affected by the adoption of Sec. 173.13. Those exemptions
are DOT E-7891, 7909, 8249, 9168, 10672, 10755, 10891, 10962, and
10977.
Section 173.21. In the NPRM, RSPA proposed to incorporate into
Sec. 173.21 the provisions of a competent authority approval for
temperature-controlled shipments. RSPA received several comments in
support of the proposal, but commenters also requested changes to the
section. One commenter noted that no specific reference to cargo tanks
or portable tanks was made in the proposed section and questioned
whether they were included. Section 173.21(f)(3) does not authorize
packagings, but provides methods of stabilization that are authorized
by the Associate Administrator for Hazardous Materials Safety.
Therefore, cargo tanks or portable tanks are not excluded from the
provisions of Sec. 173.21(f)(3).
Several commenters requested that Sec. 173.21(f)(3)(i)(B), which
requires the temperature of the material to be measured and entered on
a written record at the time the material is filled, only apply to bulk
packagings and not to all packagings. The commenters stated that
measuring and recording the temperature of every small, individual
package as it is filled is an unnecessary burden that would do nothing
to enhance transportation safety. RSPA believes that measuring and
recording the temperature of the packaging prior to transport is an
important part of the approved stabilization process. However, RSPA is
revising Sec. 173.21(f)(3)(i)(B) to require determination of the
temperature of the package, by appropriate means, at the time it is
loaded into the transport vehicle, not when the package is filled. This
should eliminate the unnecessary measurement of packages that are in
storage and not in transportation.
Section 173.32a. As proposed, RSPA is removing the requirement that
an approval agency submit an approval certificate to the Associate
Administrator for Hazardous Materials Safety.
Section 173.155. RSPA is amending this section as proposed.
Section 173.171. Sections 173.171 and 177.838(g) prescribe
requirements for smokeless powder for small arms. However,
Sec. 177.838(g) provides additional relief by allowing inside packages
of smokeless powder to be overpacked in UN 4G boxes, provided the net
weight of smokeless powder in any one box does not exceed 7.26 kg (16
pounds). This provision is not contained in Sec. 173.171. Therefore, as
proposed, RSPA is removing the Sec. 177.838(g) provisions pertaining to
classification and packaging, and adding the provision concerning
smokeless powder in overpacks to Sec. 173.171. In addition, as
proposed, RSPA is broadening the exception for reclassification of
smokeless powder to Division 4.1 to include transportation by vessel
and cargo aircraft. RSPA received two comments on this proposal. One
commenter agreed with the proposal but requested that there be no limit
on the amount of material authorized per transport vehicle. In the
NPRM, RSPA proposed to extend the application of an existing section,
i.e., Sec. 173.171, to other modes of transport, but the amount of
material authorized per transport vehicle was not proposed for
amendment. RSPA believes that the Sec. 173.171 100-pound limitation on
smokeless powder, reclassed as a Division 4.1 material, per transport
vehicle is necessary to retain the level of safety that has been
maintained for the last several years in the highway and rail modes.
One of the major arguments submitted in support of the original
regulatory provision was that the 100-pound limit would preclude a
major conflagration should these materials become involved in cargo
fires. Therefore, RSPA has not adopted the commenter's request to
eliminate the 100-pound weight limitation. Another commenter objected
to RSPA extending this reclassification to transportation by aircraft
because of its potential explosive hazards. This provision is
consistent with an exemption (DOT E-9997) that was issued in 1988.
Based on the successful experience under this exemption, RSPA believes
there is no basis for the suggestion that the reclassification of
smokeless powder for small arms to Division 4.1, under special testing
and approval procedures would provide an unacceptable level of safety
in air transportation. Therefore, RSPA is extending the applicability
of Sec. 173.171 to transportation by cargo aircraft.
Section 173.220. RSPA is amending this section as proposed.
Section 173.230. RSPA is amending this section as proposed.
Section 173.435. In Sec. 173.435, RSPA is amending the Table of
A1 and A2 values by adding an entry for MFP (mixed fission
products). This entry was inadvertently left off the table under Docket
HM-169A (61 FR 20747).
Part 176
Section 176.104. RSPA is amending this section as proposed.
Part 177
Section 177.801. RSPA is amending this section as proposed.
Section 177.818. RSPA is removing this section as proposed.
Section 177.821. RSPA is removing this section as proposed.
Section 177.822. RSPA is removing this section as proposed.
Sections 177.824, 177.834, and 180.407. In the NPRM, RSPA proposed
to remove Secs. 177.824 and 177.834(j) because they duplicate other HMR
provisions. RSPA proposed removing Sec. 177.834(b) because RSPA is not
aware of any hazardous material that is transported on pole trailers.
RSPA also proposed to add a new Sec. 177.834(j) consolidating the
provisions of Secs. 177.837(d), 177.839(d), and 177.841(d) that require
manholes and valves on cargo tanks to be closed prior to
transportation.
RSPA received several comments in support of these proposals. One
commenter requested that RSPA not delete Sec. 177.824 because it would
eliminate the responsibility of a motor carrier who is transporting
another party's cargo tank from satisfying the inspection and retesting
requirements of Part 180. RSPA agrees with the commenter; however,
rather than retaining Sec. 177.824, RSPA is removing it and revising
Sec. 180.407 to make it clear that a cargo tank may not be transported
unless it conforms to the retest requirements of Part 180. Otherwise,
RSPA is adopting these amendments as proposed.
Section 177.835. RSPA is removing paragraphs (k), (l), and (m) as
proposed.
Section 177.838. RSPA is amending this section as proposed.
Section 177.839. In the NPRM, RSPA proposed to revise paragraph (a)
by limiting the applicability of the paragraph to nitric acid in
concentrations of 50 percent or greater. In addition, RSPA proposed
removing the paragraph (a) restriction on stacking containers of nitric
acid higher than two tiers and all of paragraph (b) because they are
outdated and unnecessary. RSPA received one comment that supported the
proposed amendments to
[[Page 27171]]
Sec. 177.839 but requested clarification of the term ``other material''
as used in the section. The term ``other material'' refers to any other
kind of material, including nonhazardous materials. Therefore, RSPA has
adopted the amendments as proposed.
Section 177.841. As proposed, RSPA is amending Sec. 177.841,
consistent with Sec. 175.630, to authorize the transport of foodstuffs
and poisons in the same motor vehicle when loaded into separate closed
unit load devices. In addition, RSPA is removing the provision allowing
use of the container identified as package ``4000'' in the National
Motor Freight Classification 100-1, for the transport of foodstuffs and
poisons on the same motor vehicle. RSPA believes that this container
has not been used for some time and, therefore, reference to it is
unnecessary. RSPA received several comments in support of this
proposal. In addition, one commenter requested that RSPA authorize any
Division 6.1 material, except materials poisonous by inhalation, to be
transported with food grade material provided both materials are
appropriately packaged in performance-oriented containers. RSPA
believes this request to be beyond the scope of this rulemaking and has
not adopted this commenter's request.
Section 177.848. RSPA is amending this section as proposed.
Part 178
Section 178.315. In the NPRM, RSPA proposed removing the
Specification MC200 requirements from the HMR because RSPA believes
that this container is no longer utilized in hazardous materials
service. RSPA received one comment on this proposal stating that the
commenter was unaware of any person using the DOT Specification MC200.
Therefore, as proposed, RSPA is removing the Specification MC200
requirements from the HMR.
III. Regulatory Analyses and Notices
Executive Order 12866 and DOT Regulatory Policies and Procedures
This final rule is not considered a significant regulatory action
under section 3(f) of Executive Order 12866 and was not reviewed by the
Office of Management and Budget. The rule is not considered significant
under the regulatory policies and procedures of the Department of
Transportation (44 FR 11034). The economic impact of this rule is so
minimal that the preparation of a regulatory evaluation is not
warranted.
Executive Order 12612
This final rule has been analyzed in accordance with the principles
and criteria contained in Executive Order 12612 (``Federalism''). The
Federal hazardous materials transportation law (49 U.S.C. 5101-5127)
contains an express preemption provision that preempts State, local,
and Indian tribe requirements on certain covered subjects. Covered
subjects are:
(i) the designation, description, and classification of hazardous
material;
(ii) the packing, repacking, handling, labeling, marking, and
placarding of hazardous material;
(iii) the preparation, execution, and use of shipping documents
pertaining to hazardous material and requirements respecting the
number, content, and placement of such documents;
(iv) the written notification, recording, and reporting of the
unintentional release in transportation of hazardous material; or
(v) the design, manufacturing, fabrication, marking, maintenance,
reconditioning, repairing, or testing of a package or container which
is represented, marked, certified, or sold as qualified for use in the
transportation of hazardous material.
Title 49 U.S.C. 5125(b)(2) provides that if DOT issues a regulation
concerning any of the covered subjects after November 16, 1990, DOT
must determine and publish in the Federal Register the effective date
of Federal preemption. That effective date may not be earlier than the
90th day following the date of issuance of the final rule and not later
than two years after the date of issuance. This final rule clarifies
and provides relief from certain regulations governing the
transportation of hazardous materials. RSPA has determined the
effective date of Federal preemption for these requirements is October
1, 1996. Because RSPA lacks discretion in this area, preparation of a
federalism assessment is not warranted.
Regulatory Flexibility Act
I certify that this final rule will not have a significant economic
impact on a substantial number of small entities. This final rule does
not impose any new requirements on persons subject to the HMR.
Paperwork Reduction Act
Information collection requirements subject to approval by the
Office of Management and Budget (OMB) are addressed in this final rule
in Sec. 171.16 for incident reporting (OMB control number 2137-0039)
and subpart C of part 172 and Sec. 172.604 for shipping papers (OMB
control number 2137-0034). Provisions in this final rule will result in
minor reduction in information collection burdens under both approvals.
RSPA is requesting reinstatement and revision of OMB control number
2137-0039 from OMB and will display, through publication in the Federal
Register, the control number when it is approved by OMB. Public comment
on this request was invited through publication of a Federal Register
notice on March 5, 1996 (61 FR 8706). OMB control number 2173-0034 is
currently approved and the change in burden is not sufficient to
warrant revision of the approval. Under the Paperwork Reduction Act of
1995, no person generally is required to respond to a requirement for
collection of information unless the requirement displays a valid OMB
control number.
Regulation Identifier Number (RIN)
A regulation identifier number (RIN) is assigned to each regulatory
action listed in the Unified Agenda of Federal Regulations. The
Regulatory Information Service Center publishes the Unified Agenda in
April and October of each year. The RIN number contained in the heading
of this document can be used to cross-reference this action with the
Unified Agenda.
List of Subjects
49 CFR Part 171
Exports, Hazardous materials transportation, Hazardous waste,
Imports, Incorporation by reference, Reporting and recordkeeping
requirements.
49 CFR Part 172
Hazardous materials transportation, Hazardous waste, Labeling,
Marking, Packaging and containers, Reporting and recordkeeping
requirements.
49 CFR Part 173
Hazardous materials transportation, Incorporation by reference,
Packaging and containers, Radioactive materials, Reporting and
recordkeeping requirements, Uranium.
49 CFR Part 176
Hazardous materials transportation, Maritime carriers, Radioactive
materials, Reporting and recordkeeping requirements.
49 CFR Part 177
Hazardous materials transportation, Motor carriers, Radioactive
materials, Reporting and recordkeeping requirements.
[[Page 27172]]
49 CFR Part 178
Hazardous materials transportation, Packaging and containers,
Reporting and recordkeeping requirements.
49 CFR Part 180
Hazardous materials transportation, Motor carriers, Motor vehicle
safety, Packaging and containers, Reporting and recordkeeping
requirements.
In consideration of the foregoing, 49 CFR parts 171, 172, 173, 176,
177, 178, and 180 are amended as follows:
PART 171--GENERAL INFORMATION, REGULATIONS, AND DEFINITIONS
1. The authority citation for part 171 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
Sec. 171.7 [Amended]
1a. In Sec. 171.7(a)(3), in the table, the entry ``International
Maritime Dangerous Goods (IMDG) Code, 1990 Consolidated Edition, as
amended by Amendment 27 (1994) (English edition)'', in column 2, the
reference ``173.21;'' is added in appropriate numerical order.
1b. In Sec. 171.11, paragraph (d)(1) is revised to read as follows:
Sec. 171.11 Use of ICAO Technical Instructions.
* * * * *
(d) * * *
(1) For a material that meets the definition of a hazardous
substance as defined in this subchapter, the shipping paper and package
markings must conform to the provisions in Sec. 172.203(c) and 172.324,
respectively, of this subchapter.
* * * * *
2. In Sec. 171.16, paragraph (c) is revised, paragraph (d)(2) is
amended by removing the word ``nor'' at the end of the paragraph,
paragraph (d)(3) is redesignated as paragraph (d)(4), and a new
paragraph (d)(3) is added to read as follows:
Sec. 171.16 Detailed hazardous materials incident reports.
* * * * *
(c) Except as provided in paragraph (d) of this section, the
requirements of paragraph (a) of this section do not apply to incidents
involving the unintentional release of a hazardous material--
(1) Transported under one of the following proper shipping names:
(i) Consumer commodity.
(ii) Battery, electric storage, wet, filled with acid or alkali.
(iii) Paint and paint related material when shipped in a packaging
of five gallons or less.
(2) Prepared and transported as a limited quantity shipment in
accordance with this subchapter.
(d) * * *
(3) Except for consumer commodities, materials in Packing Group I;
or
* * * * *
PART 172--HAZARDOUS MATERIALS TABLE, SPECIAL PROVISIONS, HAZARDOUS
MATERIALS COMMUNICATIONS, EMERGENCY RESPONSE INFORMATION, AND
TRAINING REQUIREMENTS
3. The authority citation for part 172 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
Sec. 172.101 [Amended]
4. In the Sec. 172.101 Hazardous Materials Table, the following
amendments are made:
a. The headings for columns (8), (8B),(8C), (9A), (10), (10A), and
(10B) are revised to read ``Packaging (Sec. 173. * * *)'', ``Nonbulk'',
``Bulk'', ``Passenger aircraft/rail'', ``Vessel Stowage'',
``Location'', and ``Other'', respectively.
b. For the entries ``Cartridges for weapons, blank or Cartridges,
small arms, blank, UN 0014'', ``Cartridges for weapons, inert
projectile or Cartridges, small arms, UN0012'', ``Cartridges, power
device, UN0323'', and ``Cartridges, small arms'', in Column (7),
special provision ``112'' is removed.
c. For the entries ``Cartridges for weapons, blank or Cartridges,
small arms, blank, UN 0014'', ``Cartridges for weapons, inert
projectile or Cartridges, small arms, UN0012'', and ``Cartridges, power
device, UN0323'', in Column (8A), the word ``None'' is revised to read
``63''.
d. For the entry ``Cartridges, small arms'', in Column (8A), the
number ``230'' is revised to read ``63''.
e. For the entry ``Ethanol or Ethyl alcohol or Ethanol solutions or
Ethyl alcohol solutions'', in Column (7), the number ``24,'' is added
immediately preceding ``T1'', in Packing Group II, and the number
``24,'' is added immediately preceding ``B1'' in Packing Group III.
f. For the entry ``Smokeless powder for small arms (100 pounds or
less), NA3178'', in Column (9B), the word ``Forbidden'' is revised to
read ``7.3 kg''.
Sec. 172.102 [Amended]
5. In Sec. 172.102, in paragraph (c)(1), special provision ``112''
is removed.
6. In Sec. 172.201, paragraph (d) is revised to read as follows:
Sec. 172.201 General entries.
* * * * *
(d) Emergency response telephone number. Except as provided in
Sec. 172.604(c), a shipping paper must contain an emergency response
telephone number, as prescribed in subpart G of this part.
7. In Sec. 172.203, paragraph (c)(1) is revised to read as follows:
Sec. 172.203 Additional description requirements.
* * * * *
(c) Hazardous substances. (1) Except for Class 7 (radioactive)
materials described in accordance with paragraph (d) of this section,
if the proper shipping name for a material that is a hazardous
substance does not identify the hazardous substance by name, the name
of the hazardous substance must be entered in parentheses in
association with the basic description. If the material contains two or
more hazardous substances, at least two hazardous substances, including
the two with the lowest reportable quantities (RQs), must be
identified. For a hazardous waste, the waste code (e.g., D001), if
appropriate, may be used to identify the hazardous substance.
* * * * *
Sec. 172.203 [Amended]
8. In addition, in Sec. 172.203, the following amendments are made:
a. In paragraph (e)(2), the phrase ``and paragraph (e)(3) of this
section'' is removed.
b. Paragraph (e)(3) is removed.
9. In Sec. 172.324, paragraph (a) is revised to read as follows:
Sec. 172.324 Hazardous substances in non-bulk packagings.
* * * * *
(a) Except for packages of radioactive material labeled in
accordance with Sec. 172.403, if the proper shipping name of a material
that is a hazardous substance does not identify the hazardous substance
by name, the name of the hazardous substance must be marked on the
package, in parentheses, in association with the proper shipping name.
If the material contains two or more hazardous substances, at least two
hazardous substances, including the two with the lowest reportable
quantities (RQs), must be identified. For a hazardous waste, the waste
code (e.g., D001), if appropriate, may be used to identify the
hazardous substance.
* * * * *
10. In Sec. 172.402, paragraph (d) is revised to read as follows:
[[Page 27173]]
Sec. 172.402 Additional labeling requirements.
* * * * *
(d) Class 7 (Radioactive) Materials. Except as otherwise provided
in this paragraph, each package containing a Class 7 material that also
meets the definition of one or more additional hazard classes must be
labeled as a Class 7 material as required by Sec. 172.403 of this
subpart and for each additional hazard. A subsidiary hazard label is
not required on a package containing a Class 7 material that conforms
to criteria specified in Sec. 173.4 of this subchapter, except
Sec. 173.4(a)(1)(iv) of this subchapter.
* * * * *
11. In Sec. 172.500, paragraphs (b)(4) and (b)(5) are redesignated
as paragraphs (b)(5) and (b)(6), respectively, and a new paragraph
(b)(4) is added to read as follows:
Sec. 172.500 Applicability of placarding requirements.
* * * * *
(b) * * *
(4) Hazardous materials prepared in accordance with Sec. 173.13 of
this subchapter;
* * * * *
12. In Sec. 172.600, paragraph (d) is revised to read as follows:
Sec. 172.600 Applicability and general requirements.
* * * * *
(d) Exceptions. The requirements of this subpart do not apply to
hazardous material which is excepted from the shipping paper
requirements of this subchapter or a material properly classified as an
ORM-D.
13. In Sec. 172.604, new paragraph (c) is added to read as follows:
Sec. 172.604 Emergency response telephone number.
* * * * *
(c) The requirements of this section do not apply to--
(1) Hazardous materials that are offered for transportation under
the provisions applicable to limited quantities; and
(2) Materials properly described under the shipping names
``Engines, internal combustion'', ``Battery powered equipment'',
``Battery powered vehicle'', Wheelchair, electric'', ``Carbon dioxide,
solid'', ``Dry ice'', ``Fish meal, stabilized'', ``Fish scrap,
stabilized'', ``Castor bean'', ``Castor meal'', ``Castor flake'',
``Castor pomace'', or ``Refrigerating machine''.
14. In Sec. 172.702, paragraph (b) is revised to read as follows:
Sec. 172.702 Applicability and responsibility for training and
testing.
* * * * *
(b) Except as provided in Sec. 172.704(c)(1), a hazmat employee who
performs any function subject to the requirements of this subchapter
may not perform that function unless instructed in the requirements of
this subchapter that apply to that function. It is the duty of each
hazmat employer to comply with the applicable requirements of this
subchapter and to thoroughly instruct each hazmat employee in relation
thereto.
* * * * *
15. In Sec. 172.704, paragraphs (c)(1) and (c)(2) and the
introductory text of paragraph (d) are revised to read as follows:
Sec. 172.704 Training requirements.
* * * * *
(c) * * * (1) Initial training. A new hazmat employee, or a hazmat
employee who changes job functions may perform those functions prior to
the completion of training provided--
(i) The employee performs those functions under the direct
supervision of a properly trained and knowledgeable hazmat employee;
and
(ii) The training is completed within 90 days after employment or a
change in job function.
(2) Recurrent training. A hazmat employee shall receive the
training required by this subpart at least once every three years.
* * * * *
(d) Recordkeeping. A record of current training, inclusive of the
preceding three years, in accordance with this section shall be created
and retained by each hazmat employer for as long as that employee is
employed by that employer as a hazmat employee and for 90 days
thereafter. The record shall include:
* * * * *
PART 173--SHIPPERS--GENERAL REQUIREMENTS FOR SHIPMENTS AND
PACKAGINGS
16. The authority citation for part 173 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
17. In Sec. 173.4, the section heading is revised, paragraph
(a)(11) is removed, paragraph (a) introductory text, paragraphs (a)(9)
and (a)(10) are revised, and a new paragraph (c) is added to read as
follows:
Sec. 173.4 Small quantity exceptions.
(a) Small quantities of Class 3, Division 4.1, Division 4.2 (PG II
and III), Division 4.3 (PG II and III), Division 5.1, Division 5.2,
Division 6.1, Class 7, Class 8, and Class 9 materials that also meet
the definition of one or more of these hazard classes, are not subject
to any other requirements of this subchapter when--
* * * * *
(9) The package is not opened or otherwise altered until it is no
longer in commerce; and
(10) The shipper certifies conformance with this section by marking
the outside of the package with the statement ``This package conforms
to 49 CFR 173.4'' or, alternatively, until October 1, 2001, with the
statement ``This package conforms to the conditions and limitations
specified in 49 CFR 173.4.''
* * * * *
(c) Packages which contain a Class 2, Division 4.2 (PG I), or
Division 4.3 (PG I) material conforming to paragraphs (a)(1) through
(a)(10) of this section may be offered for transportation or
transported if specifically approved by the Associate Administrator for
Hazardous Materials Safety.
18. Section 173.13 is added to Subpart A to read as follows:
Sec. 173.13 Exceptions for Class 3, Divisions 4.1, 4.2, 4.3, 5.1, 6.1,
and Classes 8 and 9 materials.
(a) A Class 3, 8 or 9, or Division 4.1, 4.2, 4.3, 5.1, or 6.1
material is excepted from the labeling and placarding requirements of
this subchapter if prepared for transportation in accordance with the
requirements of this section. A material that meets the definition of a
material poisonous by inhalation may not be offered for transportation
or transported under provisions of this section.
(b) A hazardous material conforming to requirements of this section
may be transported by motor vehicle, rail car, or cargo-only aircraft.
Only hazardous materials permitted to be transported aboard a cargo-
only aircraft by column (9B) of the Hazardous Materials Table in
Sec. 172.101 of this subchapter are authorized for transport aboard
cargo-only aircraft pursuant to the provisions of this section.
(c) A hazardous material permitted by paragraph (a) of this section
must be packaged as follows:
(1) For liquids:
(i) The hazardous material must be placed in a tightly closed
glass, plastic or metal inner packaging with a maximum capacity not
exceeding 1.2 liters. Sufficient outage must be provided such that the
inner packaging will not become liquid full at 55 deg.C (130 deg.F).
The net quantity (measured at 20 deg.C
[[Page 27174]]
(68 deg.F)) of liquid in any inner packaging may not exceed one liter.
(ii) The inner packaging must be placed in a hermetically-sealed
barrier bag which is impervious to the lading, and then wrapped in a
non-reactive absorbent material in sufficient quantity to completely
absorb the contents of the inner packaging, and placed in a snugly
fitting, metal can.
(iii) The metal can must be securely closed. For liquids that are
in Division 4.2 or 4.3, the metal can must be hermetically sealed. For
Division 4.2 materials in Packing Group I, the metal can must be tested
in accordance with part 178 of this subchapter at the Packing Group I
performance level.
(iv) The metal can must be placed in a fiberboard box that is
placed in a hermetically-sealed barrier bag which is impervious to the
lading.
(v) The intermediate packaging must be placed inside a securely
closed, outer packaging conforming to Sec. 173.201.
(vi) Not more than four intermediate packagings are permitted in an
outer packaging.
(2) For solids:
(i) The hazardous material must be placed in a tightly closed
glass, plastic or metal inner packaging. The net quantity of material
in any inner packaging may not exceed 2.85 kg (6.25 pounds).
(ii) The inner packaging must be placed in a hermetically-sealed
barrier bag which is impervious to the lading.
(iii) The barrier bag and its contents must be placed in a
fiberboard box that is placed in a hermetically-sealed barrier bag
which is impervious to the lading.
(iv) The intermediate packaging must be placed inside an outer
packaging conforming to Sec. 173.211.
(v) Not more than four intermediate packagings are permitted in an
outer packaging.
(d) The outside of the package must be marked, in association with
the proper shipping name, with the statement: ``This package conforms
to 49 CFR 173.13.''
19. In Sec. 173.21, paragraph (f)(3) is revised to read as follows:
Sec. 173.21 Forbidden materials and packages.
* * * * *
(f) * * *
(3) Refrigeration may be used as a means of stabilization only when
approved by the Associate Administrator for Hazardous Materials Safety.
For status of approvals previously issued by the Bureau of Explosives,
see Sec. 171.19 of this subchapter. Methods of stabilization approved
by the Associate Administrator for Hazardous Materials Safety are as
follows:
(i) For highway transportation:
(A) A material meeting the criteria of this paragraph (f) may be
transported only in a transport vehicle, freight container, or motor
vehicle equipped with a mechanical refrigeration unit, or loaded with a
consumable refrigerant, capable of maintaining the inside temperature
of the hazardous material at or below the control temperature required
for the material during transportation.
(B) Each package containing a material meeting the criteria of this
paragraph (f) must be loaded and maintained at or below the control
temperature required for the material. The temperature of the material
must be determined by appropriate means and entered on a written record
at the time the packaging is loaded.
(C) The vehicle operator shall monitor the inside temperature of
the transport vehicle, freight container, or motor vehicle and enter
that temperature on a written record at the time the package is loaded
and thereafter at intervals not exceeding two hours. Alternatively, a
transport vehicle, freight container, or motor vehicle may be equipped
with a visible or audible warning device that activates when the inside
temperature of the transport vehicle, freight container, or motor
vehicle exceeds the control temperature required for the material. The
warning device must be readily visible or audible, as appropriate, from
the vehicle operator's seat in the vehicle.
(D) The carrier shall advise the vehicle operator of the emergency
temperature for the material, and provide the vehicle operator with
written procedures that must be followed to assure maintenance of the
control temperature inside the transport vehicle, freight container, or
motor vehicle. The written procedures must include instructions for the
vehicle operator on actions to take if the inside temperature exceeds
the control temperature and approaches or reaches the emergency
temperature for the material. In addition, the written temperature-
control procedures must identify enroute points where the consumable
refrigerant may be procured, or where repairs to, or replacement of,
the mechanical refrigeration unit may be accomplished.
(E) The vehicle operator shall maintain the written temperature-
control procedures, and the written record of temperature measurements
specified in paragraph (f)(3)(i)(C) of this section, if applicable, in
the same manner as specified in Sec. 177.817 of this subchapter for
shipping papers.
(F) If the control temperature is maintained by use of a consumable
refrigerant (e.g., dry ice or liquid nitrogen), the quantity of
consumable refrigerant must be sufficient to maintain the control
temperature for twice the average transit time under normal conditions
of transportation.
(G) A material that has a control temperature of 40 deg.C (104
deg.F) or higher may be transported by common carrier. A material that
has a control temperature below 40 deg.C (104 deg.F) must be
transported by a private or contract carrier.
(ii) For transportation by vessel, shipments are authorized in
accordance with the control-temperature requirements of Section 21 of
the General Introduction of the International Maritime Dangerous Goods
Code (IMDG Code).
* * * * *
20. In Sec. 173.32a, paragraph (c) is revised to read as follows:
Sec. 173.32a Approval of Specification IM portable tanks.
* * * * *
(c) Disposition of approval certificates. A copy of each approval
certificate must be retained by the approval agency and by the owner of
each IM portable tank.
* * * * *
Sec. 173.155 [Amended]
21. In Sec. 173.155, in paragraph (b)(1), the wording ``4.0 L (1
gallon)'' is revised to read ``5.0 L (1.3 gallons)''.
22. In Sec. 173.171, at the end of paragraph (a) the semicolon is
removed and a period is added in its place, the introductory text and
paragraph (b) are revised and a new paragraph (d) is added to read as
follows:
Sec. 173.171 Smokeless powder for small arms.
Smokeless powder for small arms which has been classed in Division
1.3 may be reclassed in Division 4.1, for transportation by motor
vehicle, rail car, vessel, or cargo-only aircraft, subject to the
following conditions:
* * * * *
(b) The total quantity of smokeless powder may not exceed 45.4 kg
(100 pounds) net mass in:
(1) One rail car, motor vehicle, or cargo-only aircraft; or
(2) One freight container on a vessel, not to exceed four freight
containers per vessel.
* * * * *
(d) Inside packages that have been examined and approved by the
[[Page 27175]]
Associate Administrator for Hazardous Materials Safety may be packaged
in UN 4G fiberboard boxes meeting the Packing Group I performance
level, provided all inside containers are packed to prevent movement
and the net weight of smokeless powder in any one box does not exceed
7.3 kg (16 pounds).
23. In Sec. 173.220, paragraph (g)(2) is revised to read as
follows:
Sec. 173.220 Internal combustion engines, self-propelled vehicles, and
mechanical equipment containing internal combustion engines or wet
batteries.
* * * * *
(g) * * *
(2) Are not subject to the requirements of subparts D, E, and F
(marking, labeling, and placarding, respectively) of part 172 or
Sec. 172.604 (emergency response telephone number) of this subchapter
for transportation by vessel or aircraft.
Sec. 173.63 [Amended]
Sec. 173.230 [Removed]
24. Paragraph (b) of Sec. 173.230 is redesignated as paragraph (b)
of Sec. 173.63 and Sec. 173.230 is removed.
24a. In Sec. 173.435, in the Table of A1 and A2 values
for radionuclides, the following entry is added, in appropriate
alphabetical order, to read as follows:
Sec. 173.435 Table of A1 and A2 values for radionuclides.
* * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
Specific activity
Symbol of radionuclide Element and A1 (TBq) A1 (Ci) A2 (TBq) A2 (Ci) -------------------------
atomic No. (TBq/g) (Ci/g)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
MFP.................................. ........... (see Sec. 173.433).... ........... (see Sec. 173.433).... ........... ........... ...........
* * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
PART 176--CARRIAGE BY VESSEL
25. The authority citation for part 176 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
26. In Sec. 176.104, the first sentence of paragraph (i) is revised
to read as follows:
Sec. 176.104 Loading and unloading Class 1 (explosive) materials.
* * * * *
(i) A landing mat must be used when a draft of nonpalletized
Division 1.1 or 1.2 (Class A and B explosive materials) is deposited on
deck. * * *
* * * * *
PART 177--CARRIAGE BY PUBLIC HIGHWAY
27. The authority citation for part 177 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
28. Section 177.801 is revised to read as follows:
Sec. 177.801 Unacceptable hazardous materials shipments.
No person may accept for transportation or transport by motor
vehicle a forbidden material or hazardous material that is not prepared
in accordance with the requirements of this subchapter.
Secs. 177.818, 177.821, 177.822, and 177.824 [Removed]
29. Sections 177.818, 177.821, 177.822, and 177.824 are removed.
30. In Sec. 177.834, paragraph (b) is removed and reserved, and
paragraph (j) is revised to read as follows:
Sec. 177.834 General requirements.
* * * * *
(j) Manholes and valves closed. A person may not drive a cargo tank
and a motor carrier may not permit a person to drive a cargo tank motor
vehicle containing a hazardous material regardless of quantity unless:
(1) All manhole closures are closed and secured; and
(2) All valves and other closures in liquid discharge systems are
closed and free of leaks.
* * * * *
Sec. 177.835 [Amended]
31. In Sec. 177.835, paragraphs (k), (l), and (m) are removed.
Sec. 177.837 [Amended]
32. In Sec. 177.837, paragraph (d) is removed.
33. In Sec. 177.838, paragraph (g) is revised to read as follows:
Sec. 177.838 Class 4 (flammable solid) materials, Class 5 (oxidizing)
materials, and Division 4.2 (pyroforic liquid) materials.
* * * * *
(g) A motor vehicle may only contain 45.4 kg (100 pounds) or less
net mass of material described as ``Smokeless powder for small arms,
Division 4.1''.
* * * * *
34. Section 177.839 is revised to read as follows:
Sec. 177.839 Class 8 (corrosive) materials.
(See also Sec. 177.834(a) through (j).)
(a) Nitric acid. No packaging of nitric acid of 50 percent or
greater concentration may be loaded above any packaging containing any
other kind of material.
(b) Storage batteries. All storage batteries containing any
electrolyte must be so loaded, if loaded with other lading, that all
such batteries will be protected against other lading falling onto or
against them, and adequate means must be provided in all cases for the
protection and insulation of battery terminals against short circuits.
35. In Sec. 177.841, paragraph (d) is removed and reserved, and
paragraph (e)(1) is revised to read as follows:
Sec. 177.841 Division 6.1 (poisonous) and Division 2.3 (poisonous
gas) materials.
* * * * *
(e) * * *
(1) Bearing a POISON label in the same motor vehicle with material
that is marked as or known to be foodstuffs, feed or any edible
material intended for consumption by humans or animals unless the
poisonous material is packaged in accordance with this subchapter and
is:
(i) Overpacked in a metal drum as specified in Sec. 173.25(c) of
this subchapter; or
(ii) Loaded into a closed unit load device and the foodstuffs,
feed, or other edible material are loaded into another closed unit load
device;
* * * * *
Sec. 177.848 [Amended]
36. In Sec. 177.848, paragraph (e)(5), is amended by removing the
phrase ``ammonium nitrate fertilizer'' and adding in its place the
phrase ``ammonium nitrate (UN 1942) and ammonium nitrate fertilizer''.
PART 178--SPECIFICATIONS FOR PACKAGINGS
37. The authority citation for part 178 continues to read as
follows:
[[Page 27176]]
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
Secs. 178.315, 178.315-1, 178.315-2, 178.315-3, 178.315-4, 178.315-5
[Removed]
38. Sections 178.315, 178.315-1, 178.315-2, 178.315-3, 178.315-4,
and 178.315-5 are removed.
PART 180--CONTINUING QUALIFICATION AND MAINTENANCE OF PACKAGINGS
39. The authority citation for part 180 continues to read as
follows:
Authority: 49 U.S.C. 5101-5127; 49 CFR 1.53.
Sec. 180.407 [Amended]
40. In Sec. 180.407, in paragraph (a)(1), the words ``filled and
offered for shipment'' are removed and ``filled and offered for
transportation or transported'' are added in their place.
Issued in Washington, DC, on May 17, 1996, under authority
delegated in 49 CFR Part 1.
Rose McMurray,
Acting Deputy Administrator, Research and Special Programs
Administration.
[FR Doc. 96-12955 Filed 5-29-96; 8:45 am]
BILLING CODE 4910-60-P
Complete official Federal Register PDF
FR Doc. 96-12888 Approval and Promulgation of State Implementation Plans: Idaho
[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27019-27023]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12888]
=======================================================================
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[ID-1-1-5528a; FRL-5449-2]
Approval and Promulgation of State Implementation Plans: Idaho
AGENCY: Environmental Protection Agency.
ACTION: Direct final rule.
-----------------------------------------------------------------------
SUMMARY: The Environmental Protection Agency (EPA) approves the State
Implementation Plan submitted by the State of Idaho for the purpose of
bringing about the attainment of the National Ambient Air Quality
Standards (NAAQS) for particulate matter with an aerodynamic diameter
less than or equal
[[Page 27020]]
to a nominal 10 micrometers (PM10) in the Northern Ada County
PM10 nonattainment area.
DATES: This action is effective on July 29, 1996 unless adverse or
critical comments are received by July 1, 1996. If the effective date
is delayed, timely notice will be published in the Federal Register.
ADDRESSES: Copies of the State's request and other information
supporting this action are available for inspection during normal
business hours at the following locations: EPA, Region 10, Office of
Air Quality (OAQ-107), 1200 Sixth Avenue, Seattle, Washington 98101,
and State of Idaho Division of Environmental Quality, 1410 N. Hilton,
Boise, ID 83720.
Written comments should be addressed to: Montel Livingston, EPA,
Region 10, Office of Air Quality, 1200 Sixth Avenue, OAQ-107, Seattle,
Washington, 98101.
FOR FURTHER INFORMATION CONTACT: Doug Cole, EPA, Region 10, Idaho
Operations Office, 1435 North Orchard, Boise, Idaho 83706, (208) 334-
9555.
SUPPLEMENTARY INFORMATION:
I. Background
On September 22, 1994, EPA issued a proposed rulemaking action on
the State Implementation Plan (SIP) for the Northern Ada County
PM10 nonattainment area. See 59 FR 48582, Sept. 22, 1994. The plan
was submitted for the purpose of satisfying the moderate area planning
requirements for PM10 nonattainment areas, as set forth in
subparts 1 and 4 of Title I of the Clean Air Act (CAA or Act). In that
proposed rulemaking, EPA proposed to grant full approval of the
emissions inventory and PM10 precursor exclusion elements, limited
approval of the control measures submitted by the State for the limited
purpose of making them Federally enforceable, and disapproval of the
control measures, attainment demonstration and quantitative milestones,
and reasonable further progress elements of the SIP. Disapproval of
these elements was based on the State's failure to adopt into the SIP
and submit to EPA the wood smoke control ordinances for the cities of
Garden City, Meridian, and Eagle, and for unincorporated Ada County,
which the State had relied on to implement the residential wood burning
program identified in the SIP. In addition, the State had failed to
adequately address in the SIP the enforceability of its control
measures. EPA received no comments on its proposal.
On December 30, 1994, the State of Idaho, Department of Health and
Welfare, Division of Environmental Quality (IDEQ or State) submitted to
EPA additional information which included the wood smoke control
ordinances for these areas; an explanation of the enforcement
procedures, responsibilities, and sources of funding for each of the
adopted ordinances; and the State's assurance of responsibility for
adequate implementation of the local control measures. As described in
more detail below, EPA believes the Northern Ada County PM10 SIP
is now fully approvable and therefore fully approves the State's plan.
II. Analysis of State Submission
A detailed analysis of the SIP is contained in the September 22,
1994, Federal Register document proposing action on the Northern Ada
County PM10 SIP. (59 FR 48582) That analysis evaluated each of the
SIP elements, and concluded that certain elements were approvable and
that certain elements had deficiencies requiring resolution. A summary
of the analysis, and additional analysis of information contained in
the December 30, 1994, submittal follows.
1. Procedural Background
IDEQ conducted public hearings and adopted the SIP consistent with
Section 110 of Clean Air Act. The initial public hearing was held on
October 11, 1990, and a second public hearing was held on November 14,
1991, on a plan modification. The additional information submitted on
December 30, 1994, included four implementing ordinances that had each
been adopted by the responsible agency after having gone through the
public hearing process required by State and local law. EPA has
determined that notice and public hearing, meeting the requirements of
40 CFR 51.102, is not required for the December 30, 1994, submittal
because the ordinances and other information submitted by the State do
not differ materially from the control measures outlined in the SIP
that went through notice and public hearing.
2. Accurate Emissions Inventory
The September 22, 1994 Federal Register document discussed the
emissions inventory contained in the November 15, 1991, SIP and
concluded it was consistent with the requirements of Sections 172(c)(3)
and 110(a)(2)(K) of the Act. The additional information submitted on
December 30, 1994, did not change the emissions inventory. Thus, for
the reasons set forth in the September 22, 1994 Federal Register
document, EPA is fully approving the emission inventory.
3. Control Measures
In the September 22, 1994 Federal Register document, EPA determined
that the November 14, 1991, SIP did not provide for the timely
implementation of reasonably available control measures (RACM),
including reasonably available control technology (RACT). To achieve
required emission reductions, the SIP relied upon a residential wood
burning program, which consisted of four elements: an episodic wood
burning curtailment program, a wood smoke public education/awareness
program, a wood stove certification program, and a wood stove change-
out program. The principal element of the residential wood burning
program was the episodic wood burning curtailment program. The SIP
stated that this program would be implemented at the local level
through the adoption of local ordinances by Ada County, and by the
cities of Boise, Garden City, Eagle, and Meridian. However, as noted in
the September 22, 1994, Federal Register document, the State had not
adopted and submitted all of these ordinances as part of the SIP
submittal and the SIP therefore did not satisfy the RACM/RACT
requirement.
The additional information submitted to EPA on December 30, 1994,
included the required ordinances for Ada County, and for the cities of
Garden City, Eagle, and Meridian. Each ordinance describes the
procedures for instituting a wood stove curtailment program, including
the monitored level at which an ``alert'' is called (100 g/m
\3\), and provisions for exemptions from the program. The additional
information also included a description of the procedures by which each
local agency in the nonattainment area which has passed a wood smoke
control ordinance will issue wood stove permits, determine exemptions
from the curtailment program, enforce the program, and fund
implementation.
EPA believes that the State's December 30, 1994, submittal
addresses the deficiencies identified in the September 22, 1994,
Federal Register document, with one exception which does not bar full
approval of the State's control measures as meeting the RACM/RACT
requirement. The State's initial SIP submittal stated that all cities
in the nonattainment area and the unincorporated areas of Ada County
had ordinances prohibiting the sale and installation of uncertified
wood stoves. The initial SIP submittal, however, only included the
ordinance for the City of Boise, and EPA proposed limited approval of
that control measure. As stated above, the additional information
[[Page 27021]]
submitted on December 30, 1994, included wood smoke control ordinances
for Garden City, Eagle, Meridian, and unincorporated Ada County. Only
the Garden City and Ada County ordinances, however, have prohibitions
on the sale and installation of non-certified wood stoves. EPA does not
believe that the failure of the Cities of Meridian and Eagle to
prohibit the sale and installation of uncertified wood stoves poses a
bar to full approval of the control measures identified in the SIP as
meeting the RACM/RACT requirement. As stated in the September 22, 1994,
Federal Register document, the State did not take any emission
reduction credit for the wood stove certification program. See 59 FR
48585. RACM/RACT does not require the implementation of all available
control measures where an area demonstrates timely attainment of the
NAAQS and implementation of additional control measures would not
expedite attainment. See 57 FR 13498, 13540-13544 (April 10, 1992).
The September 22, 1994 document discussed whether, assuming the
implementation of control measures on wood smoke as identified in the
SIP, RACM/RACT required the imposition of controls on emissions of
other sources of PM10 in the nonattainment area, such as road
dust, prescribed silvicultural and agricultural burning, and stationary
sources. See 59 FR 48585. EPA preliminarily concluded that additional
controls on these sources would not be necessary, assuming
implementation of the proposed wood smoke controls, either because
emissions from such sources were insignificant or because additional
controls on such sources were not necessary for and would not expedite
attainment. Now that the State has fully implemented the wood smoke
controls discussed in the SIP and demonstrated that such controls
result in timely attainment of the PM10 standard, EPA concludes
that RACM/RACT does not require additional controls on sources other
than wood smoke.1 Accordingly, for the reasons set forth in the
September 22, 1994, Federal Register document and the reasons set forth
herein, EPA is approving the State's control measures as meeting the
RACM/RACT requirement.
---------------------------------------------------------------------------
\1\ As discussed in Section II.6 below, the State has recently
identified in the nonattainment area two major sources of NOX,
which is a precursor to particulate formation under certain
meteorological conditions. Whether RACM requires the implementation
of additional controls on these major sources of NOX is
discussed in Section II.6 below.
---------------------------------------------------------------------------
4. Attainment Demonstration
As discussed in the September 22, 1994, Federal Register document,
IDEQ conducted modeling which demonstrated the nonattainment area will
be in attainment of the 24-hour PM10 NAAQS during the period of
1993 through 2000. However, because IDEQ had not demonstrated to EPA
that it had adopted the wood smoke control measures necessary to
achieve the emission reductions identified in the SIP, EPA proposed to
disapprove the attainment demonstration. See 59 FR 48586. Now that IDEQ
has demonstrated that the necessary control measures have been adopted
and implemented and EPA is approving those measures as meeting the
RACM/RACT requirement, EPA is giving full approval to the State's
attainment demonstration.
A review of monitored data in the Northern Ada County NAA indicates
that no exceedences of the standard have occurred since January 7,
1991. Over time, the expected exceedence rate for the 24-hour standard
has been steadily decreasing, from a high of 4.5 during the three-year
period 1986-1988 to 0.0 for the period 1992-1994. Based on the
monitored data, it appears the nonattainment area has attained the 24-
hour PM10 standard.
5. Quantitative Milestones and Reasonable Further Progress
The State's initial SIP submittal also met the requirements for
quantitative milestones and Reasonable Further Progress (RFP). In the
September 22, 1994, Federal Register document, however, EPA proposed
disapproving these requirements because attainment and maintenance of
the standard was predicated on control measures that had not been
incorporated into the SIP. See 59 FR 48586-48587. Now that this
deficiency has been corrected by the December 31, 1994, submittal, EPA
is fully approving State's plan as meeting the quantitative milestones
and RFP requirements.
6. PM10 Precursors
The September 22, 1994, Federal Register document proposed to grant
the exclusion from controls authorized under Section 189(e) of the Act
for major stationary sources of PM10 precursors in the
nonattainment area. See 59 FR 48587. EPA proposed a finding that major
stationary sources of PM10 precursors did not contribute
significantly to PM10 levels in excess of the NAAQS in the
nonattainment area. IDEQ has subsequently submitted information
identifying in the nonattainment area two major stationary sources of
NOx, a PM10 precursor under certain meteorological
conditions. Northwest Pipeline has a potential to emit 314 tons of
NOx per year and St. Alphonsus Hospital has the potential to emit
116 tons of NOx per year. The SIP provides an adequate
demonstration that implementation of RACT will be sufficient to attain
the PM10 by the applicable attainment date. In addition, EPA
reviewed the ambient air quality data from 1992, 1993, and 1994 and
determined that the area attained the NAAQS by December 31, 1994. Thus,
although there are two major stationary sources of PM10 precursors
in the nonattainment area, EPA believes these sources do not contribute
significantly to PM10 levels in excess of the NAAQS in the
nonattainment area. Therefore, Section 189(e) of the Clean Air Act does
not require the imposition of control requirements on major stationary
sources of PM10 precursors in the nonattainment area.
7. Enforceability of Control Measures
In the September 22, 1994, Federal Register document, EPA reserved
judgment on the enforceability of the identified control measures
because several of the control measures relied on by the State in its
SIP submittal had not been submitted to EPA. See 59 FR 48587. As
discussed in Section II.3 above, IDEQ has now submitted those control
measures to EPA, and EPA has determined the control measures meet the
RACM/RACT requirement. The December 31, 1994, submittal includes a
description of each implementing ordinance, the agency responsible for
enforcement, enforcement procedures and penalties, and the steps the
State of Idaho would take should an agency fail to implement or enforce
its respective ordinance, as required by Section 110(a)(2)(E) of the
Clean Air Act. Specifically, IDEQ has committed to impose Tier II
operating permits on all owners and operators of wood stoves within the
nonattainment area should a local agency fail to implement its
ordinance, and IDEQ has demonstrated its authority to do so. In
summary, EPA believes that IDEQ has satisfied the enforceability
requirements of Title I of the Act, including the requirements of
Section 110(a)(2)(E), and is therefore fully approving the State's SIP
as meeting these requirement.
8. Contingency Measures
Section 172(c)(9) of the Act requires that contingency measures be
included in each moderate area PM10 nonattainment plan. These
measures must take effect without further action by the State or EPA
upon a
[[Page 27022]]
determination that the area has failed to make Reasonable Further
Progress (RFP) or attain the PM10 NAAQS by the applicable
statutory deadline, and should result in emission reductions
approximately equal to the emissions reductions necessary to
demonstrate RFP. See generally 57 FR 13510-13512 and 13543-13544. For a
moderate PM10 nonattainment area, such as Northern Ada County,
with a three to four year period between SIP development and the
attainment date, this would mean that contingency measures should
result in emission reductions equal to at least 25 percent of the
emission reductions in the total control strategy. 57 FR 13544. A State
may rely on ``over control'' as a contingency measure, that is, rely on
control measures that are part of the core control strategy in the SIP,
if such control measures result in emission reductions greater than
those required to achieve the 24-hour NAAQS standard of 150 g/
m3.
On July 13, 1995, IDEQ submitted contingency measures to EPA for
approval which were a combination of over control from the wood smoke
control measures and new controls on fugitive road dust. Modeling of
the core control measures in the SIP for the Northern Ada County
nonattainment area indicates a 17 g/m\3\ reduction in the 24-
hour standard (from 164 g/m\3\ to 147 g/m\3\). This
means that the core control measures in the SIP result in over control
of 18 percent (ratio of the difference between 147 g/m\3\ and
150 g/m\3\ to 17 g/m\3\). To obtain the additional 7
percent of emission reductions needed for 25 percent reduction of
emissions through contingency measures, the State has adopted a program
for the reduction of fugitive road dust. The State's submittal includes
a signed agreement between the Idaho Transportation Department, Ada
County Highway District, and IDEQ, which details a road sweeping
program designed to reduce particulate emissions by prioritizing road
sanding such that streets with the highest potential to emit PM10,
in the form of re-entrained dust, are swept first, and more frequently.
IDEQ retains the authority to review and approve any changes to the
plan. The State anticipates that this road dust program will result in
an additional 9 percent reduction in PM10 emissions. Together with
the 18 percent in emission reductions achieved through over control,
the State's contingency measures are predicted to result in more than
25 percent of the total reductions necessary for attainment. EPA
therefore approves the contingency measures submitted by the State on
July 13, 1995.
9. New Source Review
States with initial moderate PM10 nonattainment areas were
required to submit a permit program for the construction and operation
of new and modified stationary sources of PM10 by June 30, 1992.
See Section 189(a) of the Clean Air Act. This permit program element,
known as the New Source Review (NSR) program, was submitted by the
State of Idaho on May 17, 1994. EPA notified the State on June 10,
1994, that its NSR program submittal was complete. EPA is currently
reviewing Idaho's NSR program submittal to determine if the program
meets the requirements of the Act. EPA intends to take action on
Idaho's NSR program in another rulemaking after EPA has completed its
review.
III. This Action
EPA is granting full approval to the November 14, 1991, Northern
Ada County PM10 SIP, as supplemented by additional information
which IDEQ has submitted since that time. IDEQ has demonstrated that
the SIP meets the applicable requirements of the Act.
IV. Administrative Review
Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA
must prepare a regulatory flexibility analysis assessing the impact of
any proposed or final rule on small entities. 5 U.S.C. 603 and 604.
Alternatively, EPA may certify that the rule will not have a
significant impact on a substantial number of small entities. Small
entities include small businesses, small not-for-profit enterprises,
and government entities with jurisdiction over populations of less than
50,000.
SIP approvals under Section 110 and Subchapter I, Part D, of the
CAA do not create any new requirements, but simply approve requirements
that the State is already imposing. Therefore, because the Federal SIP-
approval process does not impose any new requirements, I certify that
it does not have a significant impact on any small entities affected.
Moreover, due to the nature of the Federal-State relationship under the
CAA, preparation of a regulatory flexibility analysis would constitute
Federal inquiry into the economic reasonableness of State action. The
CAA forbids EPA to base its actions concerning SIPs on such grounds.
Union Electric Co. v. U.S.E.P.A., 427 U.S. 246, 256-66 (S.Ct. 1976); 42
U.S.C. 7410(a)(2).
Under Section 202 of the Unfunded Mandates Reform Act of 1995,
signed into law on March 22, 1995, EPA must prepare a budgetary impact
statement to accompany any proposed or final rule that includes a
Federal mandate that may result in estimated costs to State, local, or
tribal governments in the aggregate; or to the private sector, of $100
million or more. Under Section 205, EPA must select the most cost-
effective and least burdensome alternative that achieves the objectives
of the rule and is consistent with statutory requirements. Section 203
requires EPA to establish a plan for informing and advising any small
governments that may be significantly or uniquely affected by the rule.
EPA has determined that the approval action promulgated does not
include a Federal mandate that may result in estimated costs of $100
million or more to State, local, or tribal governments in the
aggregate, or to the private sector. This Federal action approves pre-
existing requirements under State or local law, and imposes no new
Federal requirements. Accordingly, no additional costs to State, local,
or tribal governments, or to the private sector, result from this
action.
EPA has reviewed this request for revision of the Federally-
approved SIP for conformance with the provisions of the 1990 Clean Air
Act Amendments enacted on November 15, 1990. The EPA has determined
that this action conforms with those requirements.
Nothing in this action should be construed as permitting or
allowing or establishing a precedent for any future request for
revision to any SIP. Each request for revision to the SIP shall be
considered separately in light of specific technical, economic, and
environmental factors, and in relation to relevant statutory and
regulatory requirements.
This action has been classified as a Table 3 action for signature
by the Regional Administrator under the procedures published in the
Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by a
July 10, 1995, memorandum from Mary Nichols, EPA Assistant
Administrator for Air and Radiation. The Office of Management and
Budget has exempted this regulatory action from Executive Order 12866
review.
EPA is publishing this action without prior proposal because the
Agency views this as a noncontroversial amendment and anticipates no
adverse comments. However, in a separate document in this Federal
Register publication, EPA is proposing to approve the SIP revision
should adverse or critical comments be filed. This action will be
effective July 29, 1996
[[Page 27023]]
unless, by July 1, 1996 adverse or critical comments are received.
If EPA receives such comments, this action will be withdrawn before
the effective date by publishing a subsequent document that will
withdraw the final action. All public comments received will be
addressed in a subsequent final rule based on this action serving as a
proposed rule. EPA will not institute a second comment period on this
action. Any parties interested in commenting on this action should do
so at this time. If no such comments are received, the public is
advised that this action will be effective July 29, 1996.
Under Section 307(b)(1) of the Clean Air Act, petitions for
judicial review of this action must be filed in the United States Court
of Appeals for the appropriate circuit by July 29, 1996. Filing a
petition for reconsideration by the Administrator of this final rule
does not affect the finality of this rule for the purposes of judicial
review nor does it extend the time within which a petition for judicial
review may be filed and shall not postpone the effectiveness of such
rule or action. This action may not be challenged later in proceedings
to enforce its requirements. (See Section 307(b)(2), 42 U.S.C.
7607(b)(2)).
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Incorporation by
reference, Intergovernmental relations, Particulate matter.
Note: Incorporation by reference of the Implementation Plan for
the State of Idaho was approved by the Director of the Office of
Federal Register on July 1, 1982.
Dated: March 20, 1996.
Chuck Clarke,
Regional Administrator.
Part 52, chapter I, title 40 of the Code of Federal Regulations is
amended as follows:
PART 52--[AMENDED]
1. The authority citation for Part 52 continues to read as follows:
Authority: 42 U.S.C. 7401-7671q.
Subpart N--Idaho
2. Section 52.670 is amended by adding paragraph (c)(31) to read as
follows:
Sec. 52.670 Identification of plan.
* * * * *
(c) * * *
(31) On November 14, 1991, and on December 30, 1994, the Idaho
Department of Health and Welfare (IDHW) submitted revisions to the
Idaho State Implementation Plan (SIP) for the Northern Ada County/Boise
Particulate (PM10) Air Quality Improvement Plan.
(i) Incorporation by reference.
(A) November 14, 1991, letter from the IDHW Administrator to the
EPA Region 10 Regional Administrator submitting a revision to the Idaho
SIP for the Northern Ada County/Boise Particulate Air Quality
Improvement Plan; The Northern Ada County Boise Particulate (PM10)
Air Quality Improvement Plan adopted on November 14, 1991.
(B) December 30, 1994, letter from the IDHW Administrator to the
EPA Region 10 Regional Administrator including a revision to the Idaho
SIP for the Northern Ada County/Boise PM10 Air Quality Improvement
Plan; Appendix C-1, Supplemental Control Strategy Documentation,
Northern Ada County/Boise PM10 Air Quality Improvement Plan,
adopted December 30, 1994, with the following attachments: Garden City
Ordinances #514 (May 14, 1987), #533 (January 10, 1989) and #624
(September 13, 1994); Meridian Ordinance #667 (August 16, 1994); Eagle
Ordinance #245 (April 26, 1994); Ada County Ordinance #254 (November 3,
1992); and Table Ordinance-1 (December 30, 1994).
[FR Doc. 96-12888 Filed 5-29-96; 8:45 am]
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