11 September 2003
Source: http://www.access.gpo.gov/su_docs/aces/fr-cont.html

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[Federal Register: September 11, 2003 (Volume 68, Number 176)]
[Rules and Regulations]
[Page 53509-53513]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11se03-10]

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DEPARTMENT OF JUSTICE

Bureau of Alcohol, Tobacco, Firearms and Explosives

27 CFR Part 555

[ATF No. 2; AG Order No. 2683-2003 and Docket No. ATF2002R-341P]
RIN 1140-AA20

Implementation of the Safe Explosives Act, Title XI, Subtitle C
of Public Law 107-296--Delivery of Explosive Materials by Common or
Contract Carrier

AGENCY: Bureau of Alcohol, Tobacco, Firearms and Explosives; Department
of Justice.

[[Page 53510]]

ACTION: Interim final rule with request for comments.

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SUMMARY: The Department of Justice is amending current regulations of
the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) to remove
the requirement that common or contract carriers taking possession of
explosive materials for delivery to a licensee or permittee complete
ATF Form 5400.8 (Explosives Delivery Record) prior to taking possession
of explosive materials, regardless of whether they are hired by the
distributor or by the distributee. ATF believes that this requirement
is unduly burdensome and unnecessary. Furthermore, ATF does not believe
that the elimination of this form will result in diversion of explosive
materials to criminal or terrorist use. ATF will continue to require
distributors of explosive materials to verify the identity of persons
accepting possession of explosive materials for common or contract
carriers, and will require distributors to record the name of the
common or contract carrier and the full name of the driver in their
permanent records.
    The interim rule will remain in effect until superseded by final
regulations.

DATES: Effective date: This interim rule is effective September 11,
2003.
    Comment date: Comments must be submitted on or before October 14,
2003.

ADDRESSES: Send written comments to: James P. Ficaretta, Program
Manager; Room 5150; Bureau of Alcohol, Tobacco, Firearms and
Explosives; P.O. Box 50221; Washington, DC 20091-0221; ATTN: ATF No. 2.
Written comments must include your mailing address and be signed, and
may be of any length.
    E-mail comments may be submitted to: nprm@atf.gov. E-mail comments
must contain your name, mailing address, and e-mail address. They must
also reference this document number, as noted above, and be legible
when printed on 8\1/2\'' x 11'' paper. ATF will treat e-mail as
originals and ATF will not acknowledge receipt of e-mail. See the
Public Participation section at the end of the SUPPLEMENTARY
INFORMATION section for requirements for submitting written comments by
facsimile.

FOR FURTHER INFORMATION CONTACT: James P. Ficaretta; Firearms,
Explosives and Arson; Bureau of Alcohol, Tobacco, Firearms and
Explosives; U.S. Department of Justice; 650 Massachusetts Avenue, NW.,
Washington, DC 20226, telephone (202) 927-8203.

SUPPLEMENTARY INFORMATION:

Background

    On March 20, 2003, ATF published in the Federal Register an interim
final rule (68 FR 13768) implementing the Safe Explosives Act (SEA)
(Title XI, Subtitle C of Public Law 107-296). The SEA, among other
things, requires that all persons receiving explosives on and after May
24, 2003, obtain a Federal license or permit, and creates a new type of
permit, the ``limited permit.'' Except as otherwise provided, the
interim rule became effective upon the date of publication in the
Federal Register.

Delivery of Explosive Materials by Common or Contract Carrier

    In the preamble of the interim rule, ATF stated that on and after
May 24, 2003, all common or contract carriers taking possession of
explosive materials for delivery to a Federal explosive licensee or
permittee (including a limited permittee) must complete an ATF Form
5400.8 (Explosives Delivery Record) prior to taking possession of the
explosive materials. Specifically, ATF required common or contract
carriers to document and certify certain identifying information. ATF
also required distributors to verify the identity of the driver and to
provide information regarding the distributee. This form is required
only when delivery occurs by common or contract carrier and is not
dependent on whether the carrier is hired by the distributor or
distributee. Regulations that implement these requirements are
contained in 27 CFR 555.103(b)(3) and 555.105(b)(6)(iii) and (iv). The
form is not required when employees of distributors or distributees
make delivery.
    The primary purpose of ATF Form 5400.8 is to require verification
of the identity of employees of common or contract carriers taking
possession of explosive materials. 68 FR at 13771. Under ATF's
longstanding position since 1970, employees of common or contract
carriers have been subject to prohibitions under 18 U.S.C. 842(i)
proscribing the transportation, shipment, receipt, or possession of
explosives by persons convicted of or under indictment for felony
offenses, fugitives, substance abusers, and mental defectives. The SEA,
among other things, expanded these categories of prohibited persons to
include aliens (with limited exceptions), dishonorable dischargees, and
renunciants. However, there is no authority in the SEA for ATF to
conduct background checks on employees of common or contract carriers
to ensure that such persons are not, for example, convicted felons,
fugitives, or aliens. ATF believes that, absent background checks, ATF
should collect information to properly document and verify identities
of commercial drivers to reduce the potential for diversion to criminal
or terrorist use.
    On May 5, 2003, shortly after publication of ATF's interim rule,
the Department of Transportation (DOT) and the Department of Homeland
Security promulgated three interim final rules generally exempting
persons engaged in the commercial transportation of explosives from the
application of 18 U.S.C. 842(i) while they are engaged in such
transportation by motor carrier, water, and air. See 68 FR 23832
(Research and Special Programs Administration, DOT), 23844 (Federal
Motor Carrier Safety Administration, DOT), 23852 (Transportation
Security Administration (TSA), DHS) (to be codified at 49 CFR). On June
9, 2003, DOT and TSA also published a notice that extended this
exemption to persons engaged in the commercial transportation of
explosives via rail (68 FR 34470).
    Additionally, on February 3, 2003, TSA, then an agency of DOT,
promulgated regulations effectively allowing aliens to transport, ship,
receive, and possess explosives incident to and in connection with the
commercial transport of explosives by motor carrier or rail into the
United States from Canada. This rule generally exempted such persons
from the general prohibitions of 18 U.S.C. 842(i)(5). See 68 FR 6083
(February 6, 2003) (to be codified at 49 CFR Part 1572).
    As a consequence, upon publication of the DOT and TSA rules,
certain employees of motor, water, air, and rail carriers are no longer
subject to 18 U.S.C. 842(i) while they are engaged in the commercial
transportation of explosives. Rather, these employees are subject to
DOT and TSA security threat assessment standards. To evaluate relevant
security threat assessments, DOT and TSA now collect specific
information to ensure that employees of common or contract carriers
transporting explosives do not pose a security threat. Thus, ATF finds
that there is a significantly diminished need to collect similar
information via the ATF Form 5400.8 to ensure that explosives are not
placed in the hands of prohibited persons for possible diversion to
criminal or terrorist use.
    In addition, while not explicitly stated in the interim rule, ATF
also collects certain information on ATF Form 5400.8 to enable tracing
of explosives deliveries by a distributor to a common or contract
carrier. For

[[Page 53511]]

example, if a distributee reports a shipment of explosives as lost or
stolen, ATF can request the ATF Form 5400.8 from the distributor in
order to properly identify the trucking company and the name of the
specific employee who initially picked up the explosives. ATF believes
that this information, documenting the movement of explosives from the
distributor to the carrier, assists in reducing possible diversion of
explosives to criminal or terrorist use.
    Since 1971, ATF has imposed certain identification requirements
upon common or contract carrier employees. For example, ATF has
required documentation of the name, resident address, and identifying
information of common or contract carrier employees. ATF also has
required information related to the employee's driver's license number
and identification document. ATF has provided the employees the option,
however, to omit the latter information if the driver was ``known'' to
the distributor. In the interim rule, ATF strengthened these
requirements to ensure that the driver's identity in each case was
properly and adequately documented and verified. ATF believes that this
additional information further assists in documenting explosives
movement and reduces possible criminal or terrorist diversion.
    Based on preliminary comments on the initial interim rule, ATF has
concluded that some of the information required on the ATF Form 5400.8
is not needed to trace delivery of explosives to a common or contract
carrier. In light of this conclusion, as well as the recent DOT/TSA
interim rules, ATF finds that there is no longer a significant reason
to collect all of the information required by the ATF Form 5400.8. ATF
will continue to require that distributors verify the identity of
persons accepting possession of explosive materials for common or
contract carriers, and record the name of the common or contract
carrier and the full name of the driver. However, ATF will no longer
require that this information be recorded on the ATF Form 5400.8.
Instead, ATF will allow distributors to record the information in their
permanent records. Because all pertinent information will be recorded
in a distributor's permanent records, ATF does not believe that the
elimination of this form will result in diversion of explosive
materials to criminal or terrorist use.
    Distributors will be required to verify the identity of the person
accepting possession for the common or contract carrier by examining
such person's valid, unexpired driver's license issued by any State,
Canada, or Mexico. Distributors must record the name of the common or
contract carrier and the full name of the driver in the distributor's
permanent records that are required by 27 CFR 555.121. Current
regulations governing required records also mandate the recording of,
among other things, the date of disposition. See, e.g., 27 CFR
555.124(c)(1).
    In the event of an ATF investigation of lost or stolen explosives,
ATF has the statutory right to examine the permanent records of Federal
explosives licensees and permittees without a warrant under 18 U.S.C.
843(f). Requiring distributors to record the full name of the driver
and the name of the common or contract carrier in their permanent
records will enable ATF to conduct a trace of explosive materials
quickly and efficiently. Therefore, eliminating the Form 5400.8 will
decrease the burden on distributors and common and contract carriers,
yet the additional information required by that form still will be
collected.

Discussion of This Interim Final Rule

    This interim final rule removes the procedures set forth in 27 CFR
555.103(b)(3) and 555.105(b)(6)(iii) and (iv), which require
transactions among licensees, user permittees, and limited permittees,
on and after May 24, 2003, involving delivery of explosive materials by
a common or contract carrier, to utilize the ATF Form 5400.8,
Explosives Delivery Record. Specifically, this interim final rule
removes the procedures related to the use of Form 5400.8, thereby
removing any requirement to use the form in any and all explosives
transactions on and after May 24, 2003. This interim final rule
requires that distributors of explosive materials verify the identity
of the person accepting possession for the common or contract carrier
by examining such person's valid unexpired driver's license issued by
any State, Canada, or Mexico. In addition, distributors must record in
the permanent records they are required to keep pursuant to 27 CFR
555.121 the name of the common or contract carrier and the full name of
the driver. This rule also provides related clarification to Sec.
555.103(b)(2)(ii).
    This rule does not revise provisions related to the required use of
ATF Form 5400.8 as described in 27 CFR 555.103(a)(1)(iv) (addressing
use of the form in transactions among licensees and permittees prior to
May 24, 2003) and in 27 CFR 555.105(a)(6) (addressing use of the form
in distributions to nonlicensees and nonpermittees prior to May 24,
2003). The reasons for this are as follows:
    (1) As ATF has explained in its internet postings, immediately
after January 24, 2003, ATF suspended until further notice mandatory
use of the revised ATF Form 5400.8, Explosives Delivery Record. ATF's
internet posting required that, until May 24, 2003, the old form (in
use since 1998) continue to be used in transactions as described on the
form. See http://www.atf.gov/forms/pdfs/f54008old.pdf (ATF F 5400.8 (7-
98)).
    (2) On and after May 24, 2003, the new ATF Form 5400.8 was required
to be used in transactions as described herein. See http://www.atf.gov/forms/pdfs/f54008may2003.pdf
 (ATF Form 5400.8, Revised May 2003).
    (3) Upon the publication date of this rule, the form is not
required in any transaction whatsoever.
    Licensees and permittees who have completed ATF Forms 5400.8 prior
to the effective date of this interim final rule should continue to
maintain them as part of their permanent records in accordance with
section 555.121.

How This Document Complies With the Federal Administrative Requirements
for Rulemaking

A. Executive Order 12866

    The Department of Justice, Bureau of Alcohol, Tobacco, Firearms and
Explosives has determined that this rule is not a ``significant
regulatory action'' under Executive Order 12866, section 3(f),
Regulatory Planning and Review. Therefore, a Regulatory Assessment is
not required. Accordingly, this rule has not been reviewed by the
Office of Management and Budget.

B. Executive Order 13132

    This rule will not have substantial direct effects on the States,
on the relationship between the National Government and the States, or
on the distribution of power and responsibilities among the various
levels of government. Therefore, in accordance with section 6 of
Executive Order 13132, the Attorney General has determined that this
regulation does not have sufficient federalism implications to warrant
the preparation of a federalism summary impact statement.

C. Executive Order 12988: Civil Justice Reform

    This rule meets the applicable standards set forth in sections 3(a)
and 3(b)(2) of Executive Order 12988.

D. Administrative Procedure Act (APA)

    Because this rule eliminates the use of a particular form while
maintaining the

[[Page 53512]]

requirement that most of the information covered by the form be
collected and retained elsewhere, its only effect is to lessen a small
administrative burden. Therefore, the Attorney General has found it to
be unnecessary and contrary to the public interest to provide notice
and seek prior public comment regarding this rule. See 5 U.S.C. 553(b)-
(c). Furthermore, because this rule merely constitutes relief from a
restriction on certain transactions, it is not subject to the delayed-
effective-date provision of the APA. See 5 U.S.C. 553(d)(1).

E. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an
agency to conduct a regulatory flexibility analysis of any rule subject
to notice and comment rulemaking requirements unless the head of the
agency certifies that the rule will not have a significant economic
impact on a substantial number of small entities. Small entities
include small businesses, small not-for-profit enterprises, and small
governmental jurisdictions. The Attorney General has reviewed this
regulation and, by approving it, certifies that this rule will not have
a significant economic impact on a substantial number of small
entities. Although it removes a requirement that a government form be
prepared and submitted, most of this information still must be recorded
in the distributor's permanent records.

F. Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by section 251 of the
Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C.
804). This rule will not result in an annual effect on the economy of
$100 million or more; a major increase in costs or prices; or
significant adverse effects on competition, employment, investment,
productivity, innovation, or on the ability of United States-based
enterprises to compete with foreign-based enterprises in domestic and
export markets. A copy of this interim rule, however, has been provided
to the Small Business Administration for its review.

G. Unfunded Mandates Reform Act of 1995

    This rule will not result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year, and it will not significantly or
uniquely affect small governments. Therefore, no actions were deemed
necessary under the provisions of the Unfunded Mandates Reform Act of
1995.

H. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995, Pub. L. 104-13, all
Departments are required to submit to the Office of Management and
Budget (OMB), for review and approval, any reporting requirements
inherent in a final/interim rule. The collections of information in
this regulation have been approved by OMB under control numbers 1140-
0079 and 1140-0075. An agency may not conduct or sponsor, and a person
is not required to respond to, a collection of information unless it
displays a valid control number assigned by OMB. The collections of
information in this regulation are in 27 CFR 555.103 and 555.105. This
rule decreases existing recordkeeping requirements for distributors of
explosive materials and common and contract carriers by abolishing the
use of ATF Form 5400.8, by limiting the information that distributors
are required to record to the name of the common or contract carrier
and the full name of the driver, and by allowing distributors to record
such information in their permanent records rather than on a separate
ATF form.

Public Participation

    ATF is requesting comments on the interim regulations from all
interested persons. ATF is also specifically requesting comments on the
clarity of this interim rule and how it could be made easier to
understand.
    Comments received on or before the closing date will be carefully
considered. Comments received after that date will be given the same
consideration if it is practical to do so, but assurance of
consideration cannot be given except as to comments received on or
before the closing date.
    ATF will not recognize any material in comments as confidential.
Comments may be disclosed to the public. Any material that the
commenter considers to be confidential or inappropriate for disclosure
to the public should not be included in the comment. The name of the
person submitting a comment is not exempt from disclosure.
    You may submit written comments by facsimile transmission to (202)
927-0506. Facsimile comments must:
    [sbull] Be legible;
    [sbull] Include your mailing address;
    [sbull] Reference this document number;
    [sbull] Be 8\1/2\'' x 11'' in size;
    [sbull] Contain a legible written signature; and
    [sbull] Be not more than five pages long.
    ATF will not acknowledge receipt of facsimile transmissions. ATF
will treat facsimile transmissions as originals.
    Any interested person who desires an opportunity to comment orally
at a public hearing should submit his or her request, in writing, to
the Director within the 30-day comment period. The Director, however,
reserves the right to determine, in light of all circumstances, whether
a public hearing is necessary.

Disclosure

    Copies of this interim rule and the comments received will be
available for public inspection by appointment during normal business
hours at: ATF Reference Library, Room 6480, 650 Massachusetts Avenue,
NW., Washington, DC 20226, telephone (202) 927-7890.

Regulation Identification Number

    A regulation identification 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 the Federal Register in April and October of each year. The RIN
contained in the heading of this document can be used to cross-
reference this action with the Unified Agenda.

Drafting Information

    The author of this document is James P. Ficaretta; Firearms,
Explosives and Arson; Bureau of Alcohol, Tobacco, Firearms and
Explosives.

List of Subjects in 27 CFR Part 555

    Administrative practice and procedure, Authority delegations,
Customs duties and inspection, Explosives, Hazardous materials,
Imports, Penalties, Reporting and recordkeeping requirements, Safety,
Security measures, Seizures and forfeitures, Transportation, and
Warehouses.

Authority and Issuance

0
For the reasons discussed in the preamble, 27 CFR Part 555 is amended
as follows:

PART 555--COMMERCE IN EXPLOSIVES

0
1. The authority citation for 27 CFR Part 555 continues to read as
follows:

    Authority: 18 U.S.C. 847.

0
2. Section 555.103 is amended by revising the last sentence in
paragraph (b)(2)(ii) and by revising paragraph (b)(3) to read as
follows:

[[Page 53513]]

Sec.  555.103  Transactions among licensees/permittees and transactions
among licensees and holders of user permits.

* * * * *
    (b) * * *
    (2) * * *
    (ii) * * * Except as provided in paragraph (b)(3) of this section,
in all instances the distributor must verify the identity of the
distributee, or the employee of the distributee accepting possession of
explosive materials on behalf of the distributee, by examining an
identification document (as defined in Sec.  555.11) before
relinquishing possession.
* * * * *
    (3) Delivery of explosive materials by common or contract carrier.
When a common or contract carrier will transport explosive materials
from a distributor to a distributee who is a licensee or holder of a
user permit, the distributor must take the following actions before
relinquishing possession of the explosive materials:
    (i) Verify the identity of the person accepting possession for the
common or contract carrier by examining such person's valid, unexpired
driver's license issued by any State, Canada, or Mexico; and
    (ii) Record the name of the common or contract carrier (i.e., the
name of the driver's employer) and the full name of the driver. This
information must be maintained in the distributor's permanent records
in accordance with Sec.  555.121.
* * * * *

0
3. Section 555.105 is amended by revising paragraphs (b)(6)(iii) and
(b)(6)(iv) to read as follows:

Sec.  555.105  Distributions to nonlicensees, nonpermittees, and
limited permittees.

* * * * *
    (b) * * *
    (6) * * *
    (iii) Delivery by common or contract carrier hired by the
distributor. Where a common or contract carrier hired by the
distributor will transport explosive materials from the distributor to
a holder of a limited permit:
    (A) The limited permittee must, prior to delivery of the explosive
materials, complete the appropriate section on Form 5400.4, affix to
the Form 5400.4 one of the six IPECs he has been issued, and provide
the form to the distributor in person or by mail.
    (B) The distributor must, before relinquishing possession of the
explosive materials to the common or contract carrier:
    (1) Verify the identity of the person accepting possession for the
common or contract carrier by examining such person's valid, unexpired
driver's license issued by any State, Canada, or Mexico; and
    (2) Record the name of the common or contract carrier (i.e., the
name of the driver's employer) and the full name of the driver. This
information must be maintained in the distributor's permanent records
in accordance with Sec.  555.121.
    (C) At the time of delivery of the explosive materials, the common
or contract carrier, as agent for the distributor, must verify the
identity of the person accepting delivery on behalf of the distributee,
note the type and number of the identification document (as defined in
Sec.  555.11) and provide this information to the distributor. The
distributor must enter this information in the appropriate section on
Form 5400.4.
    (iv) Delivery by common or contract carrier hired by the
distributee. Where a common or contract carrier hired by the
distributee will transport explosive materials from the distributor to
a holder of a limited permit:
    (A) The limited permittee must, prior to delivery of the explosive
materials, complete the appropriate section on Form 5400.4, affix to
the Form 5400.4 one of the six IPECs he has been issued, and provide
the form to the distributor in person or by mail.
    (B) Before the delivery at the distributor's premises to the common
or contract carrier who will transport explosive materials to the
holder of a limited permit, the distributor must:
    (1) Verify the identity of the person accepting possession for the
common or contract carrier by examining such person's valid, unexpired
driver's license issued by any State, Canada, or Mexico; and
    (2) Record the name of the common or contract carrier (i.e., the
name of the driver's employer) and the full name of the driver. This
information must be maintained in the distributor's permanent records
in accordance with Sec.  555.121.
* * * * *

    Dated: September 5, 2003.
John Ashcroft,
Attorney General.
[FR Doc. 03-23093 Filed 9-10-03; 8:45 am]