### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 02/1 6



## Scor r R

. MORRI S 

## - V

. 

## . _. > ,^

. s 1 2 3 4 S e 7 — s - 9 I D 1 1 1 2 1 3 1 4 I S I S 1 7 1 8 1 9 2 0 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 « 3 7 3 8 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 B 4 9 5 0 S I 5 2 5 3 FA A OFFIC E O FREGIONAL COUNSEL

. - - ^- ^ ^ ^

. ^ 

## 160 1 Lm D AVE. , S W

. -l i ..- ] :- • : • :J\ J RENTON , WASHTNGTO N

## 9805 7 TELEPHOKE : 

## 425.227.141 7 FACSIMILE

: 425.227.1007 

# UNITEirSTATESTDFTtMERIC S DEPARTMEN T O FTRANSPORTATIO N

- - OFFIC E O FHEARING S

WASHINGTON , D.C

.

I n th e Matte r

of : Westmark

Industries , Inc

. FA A DOCKE T CP06NM000 8 FA A Cas e No

. 2006NM70009 5 DM. S No

. FAA-2006-2633 8 Judg e Goodwi n

To ; Responden t COMPLAINANT' S INITIA LDISCOVER Y REQUES T
I n accordanc e \viti i 1 4 C-F.R

. § 13.22 0 an dth e Federa l Rule s o f Civi l Procedure , pleas e respon dt o th e followin g Interrogatories , Request s for Productio n o f

Documents , an dReques t

fo r Admissions , separatel y an dfUU y under oat hb y Ma y 25,2011

. Thes e discover

y request s are intende dt o discove r informatio n and/o r

document s no t

onl y withi n your

persona l knowledg e o r

obtainabl e b y you , but

als o informatio n i n th e possessio n o f or obtainabl e b y you r

attorneys , investigators , representatives , employees , agents , o r anyon e actin g o n you r behal f o r o n tibeir behalf , Tbies e discovery request s ar e continuin g i n natur e an dany informatio n whic hmay b e discovere db y yo u subsequen t t o th e servic e an dfiling o f you r answer s mus t

b e brough t

t o th e attentio n o f

th e agenc y attorne y throug hsupplemental answer s whe n i t become s availabl e t o you , a t areasonabl e tim e prio r

t o th e hearing i n thi s matter

. I f ther e are an y additions , deletion s or change s i n th e answer s o r

informatio n provide dat

any time prio r

t o hearin g th e Responden t i s specificall y requeste dt o s o immediatel y infoi mth e agenc y attorney

. I f suc hinformatio n i s no t

furnished , th e agenc y attorne y at

th e tim e o f

th e hearin g wil l mov e t o exclud e fromevidenc e suc hinfoimatio n requeste dan dno t

furnished

. Th e agMic

y attorne y furthe

r request s that

th e Responden t

produc e th e document s identifie d an ddesignate dherei n for

inspectio n an dcopyin g at th e FA A Offic e o f

Regional Counsel , Suit e 570,160 1 Lin dAvenue , SW , Renton , Wasliingto n 98057 , b y Ma y 25,2011

. PRIVILEG E If , i n respondin g to , o r

failin g t o respon dt o thes e Interrogatories , request s for admissio n an d request s for

productio n yo u invok e o r rel y upo n an

y privileg e o f

any kind , state specificall y th e natur e o f th e privilege ; th e basi s upo n whic hyo u invoke , rel y upo n o r clai mit , includin g an

y

Complainant' aInitia l Discovery Reques t ScOTTR

. MORRIS , FA A ATTORNE V Westmark

Indui;tri« , Inc, - CP06NM0008 / 2006NM70009 5 TEL : 425,227.1417 ; FAX : 425.227,100 7 Pag e 1 o f 504/25/201 1 13:2 7 425227108 7 ANM 7 PAG E 03/1 5

1 2 3 4 5 6 7

- • E " 5 ..10_

. 1 1 1 2 1 3 1 4 1 5 1 6 1 7 I B 1. 9 2 0 2 1 2 2 2 3 2 4 2 5 2 £ 2 7 2 B 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 6 3 7 3 8 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 8 4 9 S O 5 1 5 2 S 3 

## Statutor

y o r decisiona l reference ; an

didentif r al l documents o

r othe r information , including contaot g an dcommunication s whic

hyo u believ e t o be embrace

db y the privileg e invoked

. DATE D thi s 25t hda y o f April , 2011

.

DT T R

. MORJRI

S FA A Attorne y

Complwnsait' s Initia l Discovery Reques t AVe-qtmar k Industries , Inc, - CP06NMOOOS/ 2006NM7OO09 5 Pag e 2 o f 5 SCOT T R

. MoRRTS , FA A ATTORNE Y TEL ; 425.227.1417 ; FAX : 425.227.100 704/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 04/1 &

1 2 3 4 S 6 7 ~g 9 1 0 1 1 1 2 1 3 1 4 1 5 1 6 1 7 I S 1 9 2 0 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 6 3 7 3 6 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 3 4 5 5 0 5 1 5 2 5 3 

## INTERROGATORIE S AN D REQUEST S FO RPRODUCTIO N
Interrogatory No

. 1 : Identif y b y name , address , an dtelephon e numbe r al l person s who myo u kno w t o hav e personal knowledg e o f th e matter s allege di n th e Complaint

. Interrogatory No

. 2:

- Identif y b y titiief

cfe.te , author,

- presen t

custodian ; an dcontent,

- aJ l documents-

j includin g correspondence , obtaine db y yo u o r i n your possession , relatin g t o th e assertion s i n tiie Complaint , you r

appeal, , your

answer , an dany affirmativ e defense s whic hyp u anticipate raisin g i n thismatter

. " REQUES T FO RPRODUCTTQN NO

. 1 : Provid e acop y o f al l document s referre dt o i n your answe r t o th e precedin g Interrogatory

. Interrogatory No

. 3 : Identif y b y name , addres s an dtelephon e number , al l person s who myo u inten d t o hav e testif

y a s afactua

l o r expert witnes s i n your

defens e at

th e hearin g i n thes e matter , an dfor factual witnesses , provid e adetaile dsummar y o f eac hperson s anticipate dtestimony

. Interrogatory No

. 4 : Identif y b y titie, date , author , presen t custodian , an dcontent , al l document s whic hyo u anticipat e offerin g into evidenc e at th e hearin g i n thi s matter , andthroug hwhic hwitnes s o r witnesses

. REQUES T FO RPRODUCTIO N NO

. 2 : Provid e acop y o f al l document s referre dt o i n you r answe r t o th e precedin g Interrogatory

. Interrogatory No

. 5 : Wit

hrespec t t o eac hexpert

witoes s identifie di n respons e t o Interrogator y No

. 3 , above , specif

y thei r specifi c are ao f

expertise , an dprovid e asynopsi s o f thei r credentials , background , trainin g an dexperience , Interrogatory No

. 6 : Wit

hrespec t t o eac hexpert

yo u expec t

t o cal l a s awitness , stat e th e subjec t matte r o n whic hth e exper

t i s expecte dt o testify , an dstate tiie substanc e o f th e fects an dopinion s t o whic hth e expert

i s expecte dt o testify , an dasummar y o f th e ground s for

eac hsuc hopinion

. Interrogatory No

. 7 : State b y name , address , telephon e number , dat e o f conversation , an dsubstanc e o f conversation , al l person s [other than legal counse l o r

spouse ] withwho myo u hav e discusse dth e matter s allege di n th e Complain t Interrogatory No

. 8 : Describ e withspecificit y al l of th e fact s whic hyo u anticipat e presentin g i n th e cours e o f tiae hearin g i n thi s matte r

pertainin g t o th e avoidanc e o r mitigatio n o f

tiie sanctio n sougii t b y th e FA A i n thi s case
. Interrogatory No

. 9 : Describ e withspecificit y al l o f th e document s yo u anticipat e presentin g i n th e cours e o f th e hearing i n thi s matte r

t o substantiat e an y financial inability t o pay ti^e propose d sanctio n sough t

b y tibe FA A i n thi s case
. REQUES T FO RPRODUCTIO N NO.

. 3 : Provid e acop y o f all Exhibit s tiiat

yo u wil l presen t durin g th e hearin g i n thi s matter

. REQUES T FO RPRODUCTIO N NO

. 4 : Provid e acop y o f th e company' s filedfedera l incom e tax return s for

th e perio d200 5 - 2010 , includin g al l schedules , attachments , an damendments

.
Complftinont' s Initia l Discovery Reques t Westrow k

Industries , Inc

. - CP06NMOO08/ 2O06NM.70009 5 Page s O f 5 Soor r RMORRIS , F AAATTORhfE V TEL ; 425,227.1417 ; FAX : 425.227.1D0 704/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 05/1 8

1 2 3 4 5 6 7 ""B " 9 1 0 1 1 1 2 1 3 1 4 I S 1 6 1 7 1 3 1 9 2 0 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 6 3 7 3 8 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 3 4 9 5 0 5 1 5 2 5 3 

## REQUES T FO RADMISSION S Unde r 1 4 C.F.R , 13,220(b ) an dRul e 3 6 o f tiie Federal Rule s o f

Civi l Procedure , yo u are requeste d t o admi t th e trutho f

th e followin g matters

. A matte r i s admitte dunles s responde dt o i n a reasonabl e time

. Th e Rule s o f Practic e in FA A Civi l Penalt y Actions , 1 4 C.F.R

. 13.220(d) , define s areasonabl e tim e t o b e 3 0 days

. Th e agenc y request s tha t a n answe r i s serve dupo n th e agenc y attorne y HtBeFadinittihgthe'iriMter , specificall y denyin g flie"maitter , statin g wli y th e iMttCTcannb t b e admitte do r

denied , o r

objectin g t o th e request , withreason s for th e Objection state dwithi n 3 0 day s ofth e dat e ofservic e upo n you, " t o wit : Ma y 25,2011

. J i yo u fai l t o respon dt o thes e reqnest s fo r

admission s i n writin g b v th e dat e specified , th e fact s containe dtherei n ar e deeme dadnaitted , absen t ajudge' s nUin s tha t

you r failur e t o answe r

wa s du e t o circnwistance s beyon dvou r control

. Se e 1 4 C.F.R

. § 13.220(1)(1)

. REQUES T FO RADMISSIO N N O I : Admi t tha t Westtnar k Industries , Inc

. i s abusines s entit y tiiat regula r offer , accepts , o r

transport s hazardou s material

. REQUES T FO RADMISSIO N N O 2 : Admi t that Westmar k Industries , Inc

. i s abusines s entit y tha t use s o r handles hazardou s materia l i n tli e cours e o f it s business

. REQUES T FO RADMISSIO N N O 3 : Admi t tha t Westmar k Industries , In c ha s a

n annual revenu e mexces s o f

$20,000,000

. REQUES T FO RADMISSIO N N O 4 : Admi t tiiat Westmar k hidustries

. Inc

. ha s mor e tha n 100 employees

. REQUES T FO RADMISSIO N N O 5 : Admi t that Westmar k hidustries , hic

. ha s tiie fmancia l abilif y t o pay th e propose d$16,00 0 civi l penalty

.

Complainant' s Initia l Discovqi y Reques t Westmar k Industries , Inc

. - CP06NM,0008 / 2006NM70009 5 Pag e 4 o f 5 SCOT T RMDRRI!! , FA A A.TTO.R?*E y TEL : 425.227.1417 ; FAX : 425.227,100 7

### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 06/1 6

1 2 3 4 5 6 7 

### a 9 1 0 '1 1 1 2 1 3 1 4 I S 1 6 1 7 1 6 1 9 2 0 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 6 3 7 I B 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 8 4 9 5 0 5 1 5 2 S 3 

# CERTIFICAT E O FSERVIC E I hereb y certif

y tha t th e foregoin g Complainant' s Initial Discovery Reques t ha s bee n serve dvia facsimil e an dcertifie dmai l - Retur n Receip t Requeste dthi s date , t o th e following :

Th e Honorabl e Richar dC

. Goodwi n Offic e o f hearings , M-2 0 120 0 Ne w Jerse y Avenue , S.E

. Eas t Buildin g Groun dFloor , R mE12-32 0 Washington , D.C

. 2059 0 TEL : 202.366.213 9 FAX : 202.366.753 6

Federal Aviatio n Administratio n 80 0 Independenc e Avenu e S W Washington , D.C

. 2059 1 Attn ; Hearin g Docke t

Clerk , AGC'43 0 Wilbu r Wri^ t Buildin g - Suit e 2W100 0 FAX : 202,493.502 0 Michae l Offer , Owne r Westmark

Industries , Inc

. 670 1 SWMcEwanRoa d Lak e Oswego , O R97035-781 5 TEL : 503.620.094 5 FAX : 503.639.674 9

Date dtlii s 25t hda

y o f April , 2011

.

MQIFAI RCHI N

Offic e of Regiona l Counse l (ANM-7 ) Federa l Aviatio n Administratio n 160 1 Lin dAve

. S W Renton , W A 9805 7 425.227.216 0

Complainant' s Initia l Discover y Reques t •Westmar k Industries , Inc

. - CP06NM0008/2006NM70009 5 Pag e 5 o f 5 

### ScoT T R

. MoRRts , FA A ATTORNE Y 

### TEL ; 425.227,1417 ; FAX : 425.227,100 7

### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAQ E 07/1 6

1 2 3 4 5 6 7 8 9 .1JD_.

. 1 1 1 2 1 3 1 4 1 5 1 6 1 7 I B 1 9 2t3 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 33 , 3 4 3 5 3 6 3 7 3 8 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 6 4 7 4 8 4 9 5 0 5 1 5 2 5 3 

### SCOT T R

. MORRI S FA A OFFIC E O FREGIONALCOUNSE L 

## 160 1 LIN D AVE. , SW RENTON , WASHDJOTO N

## 9805 7 TELEPHONE : 

## 425/227-141 7 FACSIMILE : 

## 425/227-1007 

# UNITE D STATE S O FAMERIC A

DEPARTMEN T O FTRANSPORTATIO N OFFIC E OF^EBARING S - WASHINGTON , D.C

.

IN TH E MATTE RO F WESTMAR K

INDUSTRIES , INC

. FA A DOCKE T NO

. CP06NM000 8 DM S No

. FAA-2006-2633 8 FA A Cas e No

. 2006NM70009 5 Judg e Richar dGoodwin

.
MOTIO N T O TAK E JUDICIA LNOTIC E Complainant , throug hhi s undersigne dcounsel , pursuan t t o Rule s o f

Practic e 13.218(a) an dFR E 201 , hereb y move s ±atth e ALJ tak e judicia l notic e ofth e following : Th e Administrator' s publishe dsanctio n guideline s for hazardou s materia l violation s containe dat 6 4 Fed

. Reg

. 1944 3 -1945 0 (Apri l 21,1999)

. (Attached )

DATE D thi s 25 * d^

y o f Apri l 2011

.

QTTR

. MORRI S FA A Attorne y

Motio n 1 0 Tak e Judicia l Notic e FA A Docke t No

. CP06NM000 8 Pag e 1 o f 2 SCOT T R

. MORRIS , FA

A ATTORNE

Y 

### TEL : 425.227

. U17 ; FAX : 425.227.100 7

## I hereb y certif y tha t th e foregoin g Motio n t o Tak e Judicia l Notic e ha s bee n serve dvi afacsimil e an dCertifie dMai l - Retur n Receip t Requeste dthi s date , t o th e following :
Th e Honorabl e Richar dC

. Goodwi n -Q£5cg-o f bearings , -M-"20

i •: 04/25/201 1 13:2 7

1 2 3 4 5 6 7 8 9 10

_ 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 9 2 0 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 3 4 3 5 3 6 3 7 3 8 3 9 4 0 4 1 4 2 4 3 4 4 4 5 4 S 4 7 4 B 4 9 5 0 5 1 5 2 5 3 425227100 7 ANM 7 PAG E 08/1 6



## CERTIFICAT E O FSERVIC E

120 0 Ne w Jerse y Avenue , S.E

. Eas t Buildin g Groun dFloor , R mE l 2-32 0 Washington , D.C

. 2059 0 TEL : 202.366.213 9 FAX ; 202.366.753 6
Federa l Aviatio n Administratio n 80 0 Independenc e Avenu e S W Washington , D.C

. 2059 1 Attn : Hearin g Docke t

Clerk , AGC-43 0 Wilbu r Wri^ t Buildin g - Suit e 2W100 0 FAX : 202.493.514 2 Michae l Offer , Owne r Westmark

Industries , Inc

. 670 1 S WMcEwa n Roa d Lake Oswego , O R97035-781 5 TEL : 503.620.094 5 FAX : 503.639.674 9

Date dthi s 2Sti i day o f

April , 2011

.

,^^ ' 

## \ y MDI FAI RCHI N Offic e o f Regiona l Counse l (ANM-7 ) Federa l Aviatio n Administratio n 160 1 Lin dAve

. S W Renton , W A 9805 7 425.227.216 0

Motio n t o Tak e Judicia l Notic e FA A Docke t

No

. CP06NM000 8 Pag e 2 o f 2 SCOT T R , MORRIS , FA A ATTORNE Y TEL : 425.227.1417 ; FAX : 425.227.100 7

### 04/25/201 1 13:2 7 425227100 7 ANM 7 RAS E 09/1 6



### Federal R^ter/Vol

. 64 , No

. 76/Wednesday , Apri l 21 , 1999/Rule s andRegulation s 1944 3
Smal l BusJnes s Regulatar y Bnforcane n t Fairnes s Ac t Th e Stna U Busines s Regulatpi y Enforcemen t

Palrnes s Ac t

of 199 6 (Pub , L104-121 ) provide s geno^ y fo r congresslona ] revie w o f

agenc y rules , A reportin g requiremen t

I s triggere di n "lilstanoes-^^KSeTTOUA-issuiBs' afinal'" "- • rul e a s deflne db y Sectio n 55 1 o f th e Administrativ e Procedure s Act

. S U.S.C , 551

. Th e Offic e o f

Managemen t

an d Budge t ha s determine dtha t

thi s rul e doe s no t constitut e amajo r

rul e for purpose s o f

th e SmaU Busines s Regulator y Enforcemen t

Fairnes s A ao f 1996

. Lis t of Subject s i n 1 2 CFRPor t 70 1 Charitabl e contributions , Credi t unions

. B y th e Nationa

l Credit Union Aclmlnlnrstio n Boar

don Apri l 15,1999

. Beck y Bekra- , Secressi y ofth e Board , Fo r th e reason s Set

forthabove , NCUA amend s 1 2 CF

Rpar t 70 1 a s follows : PAR T 701—ORGANIZATIO N AN D OPERATIO N O F FEDERA L CREDI T UNION S 1

. Th e authorit y citatio n fo r par t 70 1 continue s I

D rea da s follows : AuthewiJr

. 1 2 U.S.C

. 1752(5)

. 1755 , l7S6

. 1757

. 1759 , 17614

. 1761b , 1766.1767

. 1782 , 178< , 1787

. and1789

. Section 7 0 J

. 6 i s als o authorise db

y 3 1 U.S.C

. 3717 , Sectio n 701,3 1 I s als o Huthorlze db y I S U.S.C

. 16D 1 etseq. , 4 Z U.S,C , 1B6 1 an d4 2 US.C ; 3801-3610

. Scetto n 701,3 5 idals o authortrjj db y 4 2 U,S.C

. 4311-4312

. 2

. Par t 70 1 I S amende db y addin g § 701.2 5 t o rea da s follows : {701.2 5 Charitabl e eoitblbution a ari d donatlDna , (a ) A federa l credi t

unio n ma y mak e charitabl e contribution s and/o r donat e fund s t o recipient s no t

oi:ganl?e dfo r pro ^ tha t

ar e locate dI n o r

conduc t activitie s i n acommunit y I n whic hth e federa l credi t

unio n ha s aplac e o

f busines s o r

t o organization s tha t

ar e ta x exemp t organization s unde r

Sectio n 50 1 (c)(3 ) ofth e Interna l Revenu e Cod e an doperat e primaril y t o promot e an d develo p credi t

unions

. (b ) Tn e boar do f

director s mus t approv e chailtabl e contribution s and/o r donations , an dth e approva l mus t b e base do n adeterminatio n b y th e boar d of dlrector atha t

th e contribution s and / o r donation s ar e i n th e bes t interest s of th e federal credi t

unio n an dar e reasonabl e give n th e siz e an dfinancia l condiUo n o f

th e federa l credi t

union

. Th e boar dof

directors , i f

It chooses , ma y establis habudge t

fo r charitabl e contribution s and/o r

donation s an d authoriz e appropriat e official s ofth e

federa l credi t

unio n t o selec t

recipient s an ddisburs e budgete dfund s amon g thos e recipients

. [F RDo c 99-993 ] File d4-20-99 : 8:4 5 am ) aiLUN O eoD E TS3S-VI- P



### DEPARTMEN T O F TRANSPORTATIO N Fariara l Aviatio n Administratio n 1 4 CF R Par t 1 3 Federa l Aviatio n Adminletratio n Polic y o n Enforeeman t o f th e Hazardou s Material s RRgulations : Penalt y Guideline s AOENCY : Federa l Aviatio n Administratio n (FAA) , DOT. , ACTION : Genera l statemen t

o f policy

. SUMMARY : Thi s documen t

state s tha t FA A polic y o n determinin g th e sanctio n amount s i n FA A enforcemen t action s addressin g violation s ofth e Dcpanmen t of TiansponatlD n Hazardou s Materia l Regulation s (HMR) , Thi s polic y statemen t provide s guidanc e for

agenc y personne l i n th e exercis e of th e FAA' s prosecutoria l discretio n i n enfcircemen t case s concernin g transportatio n d F hazardou s material s b y air

. Th e guidanc e shoul dai di n analysi s o f th e fact s an dcircumstance s o f eac hcas e s o a s t o arriv e a t

a n appropriat e sanctio n i n ligh t of th e statutoril y dofina dpenalt y considerations

. Th e analytica l framewor k shoul dals o promot e a relativ e consistenc y i n determinin g civi l penaltie s for

violation s of

th e HMR , EFFECTIV

E DATE : Apri l U

. 1999

. FOa FtJUTHE R INFORMATIO N CONTACT : Bil l Wilkenlng , OfSc e o

f Clv U Aviatio n Security , Dar^erou s Good s an dCerg o Securit y Division , telephone ; (202 ) 267

- 38B4

. facsimil e (202 ) 267-5760 , email : Bill,Wlll«nlng®faa,gov , mailin g address : ACO-SOO

. 80 0 Independenc e Avenue

. S.W.

. Washington , D.C , 20591

. o r AUaj ; H L Horowitz , Enforcemen t Division , Offic e o f

th e Chie f Counsel , telephon e (202 ) 267-3137

. facsimil e (202)267-5105 , email : A]]an.fiorowitz^fas.goY , mailin g address : AGC-300 , 80 0 Independenc e Avenue , S.W. , Washington

. D.C

. 20591

. SUPPLEUENTAnn

r IMFORUATION ; Backgroun d Congres s determine dtha t th e unregulate dtransportatio n o f hazardou s material s constitute s athrea t t o publi c sf^t y I n al l form s o f

transportation

. Congres s addresse dtha t

threa t i n 197 4 b y enactin g th e Hazardou s Mat^lal s Transportatio n Ac t

(HMTA)

. B y 1990 , Congres s determine dtha t eCTectiv e enforcemen t

ofth e HMTA require d mor e sever e action , an denacte dth e Hazartlou s Material s Transportatio n Unlibr mSafety Ac t

of 1990 , Publi c La w No

. 101-615.199 0 U.S

. Cod e Congress , & Admin

. New s 10

4 Stat

. 4605 , Th e prttnai y effec t

of thi s 199 0 revisio n of •therMMT-A-wa

s ta-raisc-th e ffiaxlmum dvi l penal ^ for

violatio n o

f an y regulatio n enacte dunde r th e HMT A t o $25,000 , and , for

th e firs t time , t o requir e aS25 0 minimu mpenalt y ( n an y suc hviolation

. Th e HMT A ^>n s recodifie di n 199 4 an di s no w referre d C O a s th e "Federa l hazardou s materia l tira-nspoTtatlon law, " 199 4 U.S

. Cod e Congress

. & Admin

. New s 10 8 Stat , 759 , codifie da

t 4 9 U.S.C

. 5101-5127 , In th e 199 4 recodification , Congres s specificall y state dtha t

th e recodificatio n create dn o substantiv e chang e t o th e earlie r

formo f th e statute , The

. Federa l Civi l Penaltie s Inflatio n Adjustmen t

Ac t o f 1990

. 2 8 U.S.C

. 246 1 (note) , a s amende db y th e Deb t Collectio n Improvemen t

Ac t o f 1936 , PUbU c Law 104-134 , Apri l 26 , 1996 , provide s amechanis mfor adjustment s fo r monetao ' dvi l penaltie s fo r Inflatio n i n Orde r t o maintai n th e d^erren t effect of monetar y civi l penaltie s an dpromot e complianc e wit hth e law

. Unde r th e statute , th e ne w civi l petialt y maximum s canno t

b e applie dunles s the y ar e implemente db y regulation

. O n Decembe r

20.1996 , th e FA

A publishe d afinal rul e (6 1 F

R6744) , implementin g Ch e statut e fo r

eac hcivi l penalt y subjec t I D th e FAA' s Jurisdiction

. O n Januar y 21,1997 , th e FA

A publishe da correcUo n t o th e fina l rul e (6 2 F R4134)

. Th e final rul e i s codifie da t 1 4 CF RPar t 13 , Subpar t

H

. Pursuan t

to 1 4 CF R 13.305(d) , th e maadmu mdv U penalt y tha t ma y b e assesse dfo r

aviolatio n o f th e Federa l hazardou s materia l la w o r a hazardou s materia l regulatio n i s no w $27,500

. Congres s assigne dth e responsibilit y fo r tfie enforcemen t

o f th e Federa l hazardou s materia l transportatio n la w t o th e Secretat y o f

Transportation

. Withi n th e Departmen t

o f Transportation , th e Researc han dSpecia l Program s Administratio n (RSPA) adopt s th e Hazardou s Material s Regulation s (HMR)

. 4 9 CF

Rpart s 17 1 throug h178 , whic hgover n th e transportatio n o f hazardou s material s (Hazmat)

. Althoug h RSP A ha s som e enforcemen t responsibilities , th e responslbUl ^ fo r enforcin g th e HM

Rwit hrespec t

t o civi l avlado n i s delegate db y th e Secretar y o f Transportatio n t o th e FAA

. 4 9 CF R 1.47(k)

. Th e HMRsa t

forthregulation s Fo

r th e transportatio n o f

Haanat , A knowin g violatto n o f

th e statut e o r

o f th e HM R ca n suppor t

th e assessmen t

o f advi l04/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 10/1 6

19444 Federa l Regirter/Vol

. 64 , No

. 76/Wedr>esday , Apri l 21 , 19&9/Rule 5 an dRegulation s penalt y betivee n S25 0 an dS27,500

. A perso n act s knowingl y ^^e n th e perso n ha s actua l knowledg e o f th e fact s glvtni g rise t o th e violation ; o r

areasonabl e perso n actlri g i n th e circumstance s an d exercisin g reasonabl e car e woul dhav e tha t knowlecfee

. 4 9 U.S.C

. 5123(a)(1 ) (A)

. uJ3tift..cJvH-ponalties_aufl?.oiiis:.ediunde r the-

. statut e appl y t o EACH violatio n o f an y regulatio n se t

forthi n th e HMR

. Moreover , unde r

th e statute , eac h continuin g violatio n o f

di e HMRca n constlhit e aseparat e violatio n for eac h da y aviolatio n continues

. I n sectio n 512 4 o f th e statute,

- Congres s prescribe d crimina l penaltie s for

awill^ l violatio n of th e Federa l hazardou s materia l transportatio n la w o r

th e HMR ; wiJIfii l violation s lequir e evidenc e o f bot h luiowledg e ofth e law s an dregulation s ar> dinten t t o violat e them

. Par t 1 3 o f th e Federa l Aviatio n Regulations—^Investigativ e an d Enforcemen t

Procedure s (1 4 CF

RPar t 13 ) govern s th e procediire s appHcebl e t o enforcemen t

of th e HMRb y th e FAA , Hazma t violation s occurrin g o n o r afte r Augus t 2,1990 , ma y b e dismisse db y a n administrativ e la w judg e (AU ) i f a Notic e o f Propose dCivi l Penalt y ha s no t bee n Issue dwithi n 2 year s of th e violation , unles s goo dcaus e for dela y ha s bee n shown

. 1 4 CF

R13.208(d)

. Consideratio n o f

Statutor y Criteri a b i determinin g th e sanctio n t o b e assessed , penalt y criteri ase t forthi n 4 9 U.S.C

. 5 J2 3 mus t

b e considered

. Thes e criteri aar e th e nature , circumstances , extent , en dgravit y of

th e violation , th e deg{« e o f culpablit y ofth e vlalator , an y histor y o f

pas t violations , th e abilit y t o pay
. an y eS^ec

t o n th e abilit y t o continu e t o d o business , an dothe r matter s a s Justic e requires

. Som e o f thes e consideration s alread y ar e factore dt o som e exten t

Int o th e categorie s i n th e Hazardou s Materia l Sanctio n Guidanc e Matrix

. Th e statutor y factoi s ar e furthe r considere dunde r

th e weightin g analysi s tha t i s performe dt o indicat e th e amoun t of civi l penalt y withi n th e appropriat e range , i.e. , a t

th e minimum , moderate , o r maximu mportio n of

th e sanctio n range
. T o cotnpl y wit hth e underlyin g purpose s o

f th e Federa l hazardou s materia l transportatio n la w an dHMR , a sancdo n shoul db e Impose dtha t i s sufHclertd y deteren t

bu t no t excessive

. Th e Hazardou s Material s Sanctio n Guidanc e i s designe dt o piumot e bette r consiiltenc y s o tha t

simila r penaHtiie s ar e impose di n simila r

cases
. Th e Matri x range s ar e intende dt o reflec t th e nature , circumstanoes

. extent , an dgravit y of th e cas e as'compare dwit hothe r type s o f cases
. Eac hcase , however , mus t b e evaluate do n it s ow n iiacts

. A sanctio n rna y diffe r

fro mth e Matri x range s whe n th e ^t s an dcircumstance s o f acas e suppor t eithe r agreate r o r lesse r penalty

. Whe n aspecia l agen t believe s tha t apenalt y shoul dexcee dth e Matri x ranges , Ch

e agen t shoul dconsul t

wit h lega l counse l befbre furthe r processin g ofth e Enforcemen t

Investigativ e Repor t gno
. Thlseonsultationis-not-necessary

i n th e cas e of

arecommendedpenalt y tha t i s les s tha n tha t

provide di n th e Matrix

. I n eithe r

situation , th e basi s fo r th e decisio n t o g o outsid e th e range s shoul db e explaine di n detail

. Violation s of

Per t 17 S ofth e HMR , whic hestablis hparticula r requirement s fo r ai r carrier s an dothe r

aircraf t operators , w e containe di n aseparat e matrix

. However , suc hoperator s ofte n offe r hazardou s material s fo r ai r transportation , a s wel l a s accep t an d transpor t them

. Fo r

thi s reason , suc h operator s may b e liabl e for violation s bot ha s abusines s entit y withi n th e Hazardou s Material s Sanctio n GuidarM: e Matrix , a s we

U a s specifi c ai r

carrie r violations

. Us e ofth e Sanctio n Guidanc e Thi s guidanc e provide s agenc y personne l wit hasystemati c wa y t o evaluat e acas e an danfv e a t a n apfuiopriat e peralty , considerin g al l th e relevan t statutor y criteri aincludin g an y mitigatin g an daggravatin g circumstances

. Statutor y consideration s hav e bee n factore dint o (h e variou s range s wldil n th e Sanctio n Guidanc e Matrix

. DBtermlnatlo n o f wher e a sanctio n lie s withi n thes e range s I s aide db y aserie s of

welglitln g question s tha t prob e th e variou s aggravatin g an d mitigatin g factor s tha t

may exis t

i n a case
. First , th e weightin g analysi s i s peiformed

. AgerK

y personne l respon d t o aserie s of

question s t o determin e th e aggregate weigh t

of th e cas e Th e aggregate weigh t

o f th e cas e help s determin e th e sanctio n amoun t o f eac h violatio n grou p withi n th e establishe d range s ofth e Matrix

. I t i s importan t

t o not e the t determlrutio n o f

wher e th e sanctio n lie s withi n th e Matri x i s no t

th e resul t

of a mathemadca ) computation

. Evaluatio n o f th e cas e i s base do n th e totalit y o f th e fact s an dcircurhstances

. Generally , I f th e answe r

t o aparticula r

questio n represent s amar e significan t aspec t o f a case , greate r

consideratio n shoul db e give n t o tha t

answer
. Fo r

example , violation s involvin g a n extremel y dangerou s substance , eve n i n miTiut B quantities , migh t

warran t apenalty , at Oi e maxlmun i en dof

th e rang e o r

eve n B penalt y exceedin g th e Matri x ranges
. unde r th e Sanctio n Guidanc e Matrix , agenc y personne l determin e th e category o f

violato r th e perso n fall s withi n (e.g. , busines s entit y tha t

regularl y offets , accepts , o r trattsport s Hazmat ; an dth e offerts e categor y (e.g.

. undeclare dshipmen t

withi n Hazma t quanti ^ limitations)

. Th e sanctio n range s unde r

d> e variou s violato r categorie s tak e Int o accoun t th e relativ e culpaWitv-of-th e vlolatot

. Siiiillariy,.-the- — offens e catiegorie s addres s th e natuii T circumstances , an dgravit y o f th e particula r

oSfense , Afte r

determinin g th e appropriat e categorie s an dintersecting ' bo x o f th e Matrix , agenc y personne l the n determin e whic hsubcategorie s o f offense s (e.g. , shippin g papers ) ar e allege dt o hav e bee n violated

. Base do n th e weightin g analysi s performe di n Sectio n I

. a n appropriat e penalt y I s assigne dfor

eac hof th e applicabl e violatio n gfoups

. Th e penalt y anwun t for eac hrelevan t

violatio n grou p i s adde dtogethe r

t o reac hth e recommende dsanction

. Unde r Sectio n II

I o f th e Guidance , th e specia l agem

t the n consider s othe r relevan t factors, includin g evidenc e o f correctiv e action , A recorrunende d sanctio n ma y b e reduce dprio r t o th e issuanc e o f

aNotic e o f

Propose dCivi l Penalt y whe n ther e i s adequat e reliabl e informatio n concernin g th e correctiv e action s taker

t b y aresponden t Correctiv e action s tha t

justif / reductio n o f th e recommende dpenalt y mus e excee dth e mirtimu mlega l requirements

. Th e specia l agen t als o attempt s t o provid e informatio n concernin g th e allege dviolator' s si%

. flnandal condition , an dabilit y t o pa y a recommende dsanction

. Whe n an EI

Ri s forwarde dt o lega l counse l for

enforcemen t

action , counse l wit hgtv e appropriat e consideratio n t o

. th e recommende dsanction , FAA lega l counse l wil l als o revie w th e factors , analysis , an ddetermination s urxie r th e Hazardou s Material s Sanctio n Guidance

. Any basi s fo

r deviatin g from th e tttommen dsanctio n i s ordlraril y explaine dto , an ddiscusse dwith , th e investigatin g specia l agent

. 'Fina l determinatio n ofth e sanctio n amoun t propose di n th e Notic e o f Propose d Civi l Penalt y i s ofdirwrll y aproduc t o f join t decisonmaldn g an dapprova l o f th e investigatin g agen t

an dth e lega l office

. Federa l Aviatio n Adnoinlstratio n Hazardou s Material s Sanctio n Guidanc e Thi s Sanctio n Guidanc e I s divide d int o thre e sections ; I , Case Anelysli , n , UtUlsaiion o

f tii e Sanctio n Guidanc e Matrix (Matrix) , an d HI , Consideration <r

f othe r Statutor y Foctors

. Th e Sanction Citidanee Matrix ) acontained i n Figur e 1 an dth e Ris k CftttgorSe s ar e containe din Figur

e 2

.

### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 11/1 5

Federa l Register/Vol , 64 , No

. 76/Wednesday , Apri l 21

. 198&/Rule 5 an dRegulation s 1944 5
I

. Cas e Analysi s (Evaluatia n o f Statutor y Aswssmen t

Factors ) Thi s sectio n contain s aserie s o f question s designe dt o assis t specia l agent s an dattorn ^ i n evaluatin g a particula r

case
. Th e questio n revie w factors involvin g th e naturer

circumstances , exten t

an dgravit y ofth e vjolation , th e violator' s degre e o f culpability , an dth e violator' s hlstoi y of prio r violations

. Som e of

thes e factor s ar e alread y considere dt o som e exten t withi n Ch

e variou s categorie s of

th e Sanctio n Guidanc e Matrix

. Th e question s i n thi s sectio n provid e additloria l consideratio n of th e statutoi y factor s atx l examin e th e existenc e of aggravatin g an dmltigatirt g (actor s I n a case
. Th e agent/attorrte y answei s eac h questio n i n Sectio n 1 an ddetermine s i f arelativ e weigh t

o f minimum , moderate , o r

maximu mshoul db e assigne dbase do n th e respons e t o th e question

. Wit hth e exceptio n o f Questio n A,l. , no t

al l question s wil l appl y t o agive n fac t

situation

. Questio n A , 1 „ whic haddresse s th e natur e o f th e hazardou s materia l (s ) involved , i s th e onl y questio n tha t

alway s receive s a "yes " answe r

t o on e of it s subqucstiori s an dI s considere di n ever y case
. Th e aggravatin g o r

mitigatin g foctors addresse di n th e question s onl y appl y t o th e cas e v*^e n th e questio n receive s a "yes " response
. Question s receivin g a "no " respons e dono t

affec t th e weightin g ofth e cas e an dar e no t consider&d

. Fo r

example , if

th e violatio n resulte di n har mt o person s o r property , tha t ma y b e a n agsravatin g facto r i n th e case
. However , th e feet

tha t th e violatio n di dno t

resul t i n Irijury o r damage , i s no t

amitigatin g fector

an d shoul dno t

resul t I n penalt y mitigation

. I n man y instances , th e answer s t o mos t o r al l o f th e question s wil l b e "no " an d th e onl y relevan t

weightin g facto r

i n thi s sectio n wil l b e th e ris k categor y o f th e materia l Identifie di n Questio n A.l

. I n detertoinJtii g th e final aggregat e weigh t o f th e case , th e response s t o eac h of th e questiott s d o no t

hav e t o b e equall y considered

. Determinatio n of whethe r th e overal l cas e shoul dhav e a minimum , moderate , o r

maximu m weigh t canno t b e determine dwit h mathematica l certainty , GencraUy , i f th e answe r t o aquestio n demonstrate s tha t th e facto r a t Issu e represent s amor e slgrdflca maspec t

o f th e case , greate r consideratio n i s give n t o tha t factor

. Th e fina l aggregsite weigh t

i s base do n th e totalit y o f

3» e fact s an dcircumstance s o f th e case
. Onc e determined , th e final aggregat e weigh t

i s the n utUjze dt o arriv e at th e recommende dsanctio n for eac happlicabl e violatio n grou p o n th e Sanctio n Guidanc e Matrb < (Fig

. ])

. A , TTi e Nature , Circumstances , Extent , en dGravt ^ ofth e Violatio n (Factot s Corwemln g th e Shipment ) l,_What Matierial(s)_Wa s Offfered,

. TiwapartEdrorAccapteiJi'a r Air—~ — Transportation ? (Figur e Z divide s hazardou s material s o f particula r

classes , divisions ; arx l - packin g group s Int o thre e ris k categories : Category A , Category B , arv d Category C

. Fin dth e materlaKs ) at issu e i n Figur e 2 an daruwe r

th e question s below. ) a
. I s th e materiaUs ) offered , transported , o r

accepte di n Category A ? I f yes , assig n aMaximu mweight

. b.lstheinaterial(s ) offered , tran^iorted , o r

accepte di n Category B ? I f yes , assig n aModerat e weight

.

. c
. I s th e materia l (s) offered , transported , o r

accepte di n Category C ? I f yes , assig n aMtUiirmi

mwei^t

. GiddaBc e Note : Th

e catBgorles t

n Figur e 2 represent th e inherenc risk

o f dange r to ai r transportatio n posedh

y th e tnaterbl

. I

f ther s lamor e th« n on e type ti

f tiazardou s materia

l Involvedin th e shipmen t

answe r thi s que,stlo n usln s th e hazardou s materia l i n Ch e highes t ris k cste30iy , 2

. Wha t Quantit y of

th e Materia l (s ) Wa s OfBered, Transported , o r

Accepte dfor Ai r Transportation ?
a
. Di dth e package(s ) excee dth e authorize dquantit y limitation s b y a simifltan t

amount ? I f yes , conside r

aModerat e o r Maximu mweigh t

deper>din g o n th e degre e t o whic hth e limitatio n wa s exceeded

. Guidanc e NOIB : The Mstrlx , discussedin Section DI , take s Int o account th e factua l sltuatlon awhere th e quantit y UmitatJons fo

r th e materia

l ar e exceeded , Th) s par

t o f the analysi s i s intende dt

e dstsrtnln e whethe

r furthe r Aggravatin

g clnmrnstancf! * exis t

- wher e quantit y limltnlon aar

e exceededb

y a signlllc«n t amoun t Whethe r th U lector i s Mstgne damoderat

e or maxliTiu mweigh t wil l dependo n (bo degree b

y -whic hth e quantit

y Limit&tio n wa s eicceeded , Example : Th e quantit

y llmitatlan fo

r gasoline o n apassenge

r plan e i s 5 liter s pe

r package

. I f aviolato r offei s 3 0 [Iten

i i n a .singl e package o n aptasenger

plane , thi s ma

y resul t i n 8 maximu

mweigh t fo r thi s facbir, b

. Wer e ther e multipl e package s i n th e shipment ? If yes , conside r

aModerat e o r Maximu mweight , dependin g o n th e numbe r of package s an dtota l amoun t o f has^rdou s materia l bein g trHraporte di n violation

. Guidanc e Note : A packag e niean s a pacicagln g plu s it s ecuntents , Tiier ; ma y be multipl e package s i

n on e shipmen t or Dverpaci

LMultipl e package s ofte

n represen t muLUpl e vlolatiDna

. Unde

r th e Sanction Guidance , thi s fac

t i s considereda

n aggravating circumstanc e rather tha n adirect multiplier o f th e sanctio n for

eac hviolsuon

. Eac hcaise, however, rnua

t b e evaluatedo

n it s particula r [acts , A vei y larg e numbe

r o f package s Ria

y resul t in suc ha n egre^ou s 'Ga«(4lai;-'lHrjr«n3At:wetBht.otttie33aaels.sci:= : hig htha t apeislt y b^on d(h

e rnaximu m poin t i n th e lang e I s warranted

. A n InvestlEBtlo

n wll) occasionall

y revea l severa l sYApmeta

s fro mth e sam e oifaro r ove r aperio do f severa l days , al l o

f whic hinvolve violauon s o

f th e HMR

. Thes e independent Bci B o f alfertng usuall y ar

e oorcwUdate

dint o on e £I Randaddresse di n one Nat e o f ProposedCivi

l Penally

. However, fo

r purpose s o

f deteiTninln

g th e appropriat

e sanction , eachseparate shlpnwnt wit ha
. separat e air waybill or shippin g papers , separate destination , and/o r any othe r evidenc e eatabUshin

g i t a s aseparat

e shlpmanc I Eordinarily consldera

da s a separate incident

Ib r purpose s o

f applying th e sanctio n guidanc e arralysls

. I t i s suggestedthat

th e SGfnrat

e shipment s b

e treate da s Individual count s I n the EI Rand th e Notic e o

f ProposedCivil Penalty , wit h eachcoun t

having it s own sanctio n derived Sn mapplicatio n o

f thi s guidance

. Note , ther

e nus t b e suSicient

evidenc e t

o suppor t eac h count

. 3

. Di dth e Shipmen t

Caus e Dainag e or Har mt o Parson s o r

Property , o r

Interfer e Wit hCommeroe ? I f yes , conside r

aModerat e o r Maximu mweight

. Guidanc e Note : The fac

t tha t n o dainage occurre da s aresul t

o f the stilpmen

t S s not amitigatin g factor, However, damage or har m ma y aggravat e th e nature , circumstances , extent , andgravit

y o f th e violation , Depending o n th e degree o

f damage caused b y Th e shipment

and/o r th e eadstence o

f othe r aggravating factors , departure fro mth e range s ma y b e Justified

. B

. Violator' s Degre e c f

Culpabilit y (Th e Matrix , Figur e 1 , consider s th e relativ e culpabUit y ofth e violator

. Thi s sectio n o f

th e arialysi s furthe r

evaluate s th e degre e o f

culpabilit y o f

th e violator. ) 1

. I s th e Violato r

th e Manufacture r

o f th e Hazardou s Material ? Kyes , conside r

aMaximu mweight

. Guidanc e Kote

t A manufacture

r o f a hazardou s materia

l i s expecta

dto have complet e knowledg e o

f tiw nature o

f II E hazardou s Rutterla

l andthus , ahig

hdegre e o f culpabilit y wil l ordinaril y b

e imputedt

o I L 2 , Di dSomeon e Othe r

Tha n th e Violato r Prepar e th e Shipmen t

for Transportation ? If yes
. conside r

aMinimu mo r Moderat e weight

. Guidanc e Note ; Fact s supportin g a n affirmative answer

t o thi s questio n ma

y b e caus e t o mitigat

e culpabilit

y and/or pursue a04/25/201 1 13:2 7 425227100 7 ANM 7 PAGE 12/1 6

1944 6 Federa l RegistBr/Vol , 64 , No

. 76/Wednesday , Apri l 21

. 1999/Rule s an dRegulation s separate enforcemen

t action against

otlKi r raaponsibl e partie s wh o handle dih e slilpmem

. A shippe

r tha t reshlp s materUtl s receive dfron

i anothe r parso n I n th e sam e packagin g i s independenti y respcxislbl e fo r ensurin g the shipment

compile s wit

hthe HMR

. Nevertheless , th e reshlpper i s ganeiall y consideredt o jiav e alease r degree
_ u f i-uiprt>tllt y fo r cOJnpniiTu

e u f th e package"" " as received

. However, i

f th e ttshlppe r unpack s and/or

tepaekage s th e shipment , th e leshlppe r remain s a s culpabl e « s th e origina l suppe r andgenerall

y i s no t accorded mitigatio n under

thi s weightin g factor, (Fo

r purpose s o

f chi j section , a"reshlpper " refers to apeison

. othe

r dia n th e ortglna

l offeror , wito offer s ash^nnen t

o f hazardou s nnierla l fo r transponatlan, ) 3

. Di dth e Violato r

Reasonabl y Rel y o n Incorrec t Informatio n Fro mAnothe r Source ? I f yes
. conside r

aMinimu mweight

. Guidanc e Note ; Detrimenta l o r reasonabl e relianc e o n anothe r patty ma y b e amlUgatin

B facto r when considering th e violator' s d^ic c o f culpAillty

. For

example , relianc e o

n a n Inaccurate Materia

l Safel y Dat aSheet (MSDS ) ma y b e mitigating , 4

. Doe s th e Violato r

Hav e aHistor y o f Previou s HM

RViolations ? I f yes , conside r

aModerat e o r Maximu mweight

. Guidanc e Note : T o establis haviolatio n histoty , aprior

violatio n mus t

b e an actua l findin g of violation pucsuamt o alega l enforcemen

t action

. Specia

l agents shoul d attemp t t o determine ti)e corporat

e structure o f th e violator

andwhether

ottie r busines s enttde s o r name s ar e or hav e been usedb

y tli aentit y I n orde r t o obtai n acomplet

e violatio n history

. The nucnbe r an dage o f violation s ahouldbe conaldeied

. Oitiinarily , fin dIng B o f violation more than S year s old can y les s weight , unles s acontinuin g pane m o f violatio n exists

. C

. Othe r Factor t Eac hcas e mus t

b e evaluate do n it s particula r

facts

. A s such , man y case s ma y presen t

uniqu e scenario s an d aggravatin g o r

m l tilting foctois tha t

ar e no t routinel y seen
. If

a n aggravatin g o r mitigatin g circumstanc e exist s tha t i s no t adecjuatel y addresse delsewher e i n th e sanctio n guidance , i t ma y b e Include dan dassigne daweigh t unde r thi s sectio aTh e facto r

shoul db e clearl y I'dendifie den dexplaine di n th e analysi s portio n ofth e BI

Ran dcarefull y scrutiitize db y lega l coutuel

. Guldwic e Note : Fo r

example , ashipment o f asingl e package containin g severa l differen t hazardou s material s ma

y present a n ' aggravating factor

. The degree o f setiousnes s o f (hi s facto r wi U increas e I

f th e tuardou s material s are Incompatibl e wit heachothe r and , thereforB , creat

e a n Increasedrisk. Mitigating facior

s ma y als o exis t

tha t hav e no t bee n adequately considered

. Fo r example , ashipment

containin g *d e mtntini s quantit y o f materia l or a n aEnoun t tha t would, hav e qiialihe dunder

th e smal l quantit

y exceptio n o

f § 173,4 m ^ presen

t amttigatlri g iactor i f a s aresul t there wa s aleduce drisk to fiafety in transportation

. D

. D&ermtn i th e Fina l Aggregat e Weigh t o f th e Cas e --Al l tiiy luspLw'is^is/weigfit e evaluate dt o detemdn e afliu l aggregat e weigh t ofth e cas e (Minimum

. Moderate , an dMaximum)

. Question s reoeivli ^ a "no " respons e wil l no t

b e include dI n

- thi s evaluation

. T o determin e th e fina l aggregat e weight , th e agent/attorne y mus t exercis e his/he r

discretio n i n ligh t ofth e statutoi y fiictor s an dknowledg e o f th e particula r

fects of th e case
. Th e fsct s o f th e particula r

cas e wU l dictat e th e relativ e importanc e o f eac hof th e weightin g fectors i n reachin g e fina l aggregat e weigh t

Th e flnal aggregate weigh t shoul db e decide da s aresul t of carefu l analysis , no t

amathematica l averaging

. It

I s possibl e tha t

asingl e wel^tin g facto r

ma y outweig hal l others

. Th e agent/attorney' s analysi s shoul dalway s b e explaine dIn thi s regard , Exampie : A cas e involving ahazardou s material i n tiie lowes t

ris k categor y ww y be evaluate dto.hav e amaximu mweigh t becaus e o f til s large quarrtit

y atiippedor

th e damage resultin g fro

md^ e shipment

. H Utiliz e th e Matri x (Figur e 1 ) Th e sanctio n range s unde r flae ofEero

r an doiCert f e categorie s o

f th e Sanctio n Guicfanc e Matri x reflec t

th e relativ e culpabilit y o f

th e violato r

an dth e nature , cJrcurnstantes , extent , an d gravit y o f th e case
. Consideratio n of thes e particula r

statutor y factor s unde r th e Federa l hazardou s materia ] transportatio n la w i s buil t Int o th e Matrix

. Furthe r

analysi s o

f th e statutor y factor s i s require dt o determin e th e appropriat e sanctio n withi n th e range s establishe dunde r

th e Matrix

. Thi s aralysi s i s performe di n Sectio n 1 , Afte r determinin g th e final aggregate v^igh t ofth e cas e unde r

th e Sectio n 1 analysis , tha t vveight i s applie dt o th e appropriat e matri x rang e t o Identit y th e recommende dsanctio n amoun t for eac h of th e relevan t

violatio n group s an dfor th e cas e a s awhole

. Althoug hth e Notic e of Propose dCivi l Penalt y ma y cit e numerou s violation s o

f aparticula r

par t o r Subpar t o f th e HMR , unles s upwar d departur e IsJustiHed , asingl e penalt y amoun t for eac hviolatio n grou p i s onjlnatfl y use dt o reac hCh e fUI l sanction , A

. Instruction s 1

. Identif y th e appropriat e categor y for th e typ e o f

entit y an dth e natur e o f th e offens e jrjvolve di n th e case
. Refer t o th e Definition s Sectio n tha t follow s th e Matri x I n Figur e 1 fo r guidance

. G

o t o th e intersectin g bo x an didentif y th e applicabl e sanctio n rang e fo r eac h violatio n group
. 2

. Appl y th e coiKlusio n reache di n th e Sectio n I weightin g analysi s t o assig n asanctio n amoun t withi n th e ]m.-jno!decaie;:oij]aaximum

_ portio n of

th e sanctio n rang e for

eac h relevan t violatio n group
. Th e recommende dcivi l penalt y at thi s stag e
. i s the'Su mo

f th e sanction s for

eac hof th e applicabl e violatio n groups , A sanctio n shon^ drK>

t b e assesse dfo

r a violatio n grou p I

f ther e hav e bee n n o violation s o

f tha t pa n o r subpar t of th e HMR

. Th e sanctio n amoun t for eac h violatio n grou p nee drto t b e Identica l bu t onilnaril y i s withi n th e portio n o f th e particula r

sanctio n rang e tha t represent s th e overal l weigh t o f th e case
. 3 , Departur e fromth e Matri x ranges — Th e Matri x i s designe dt o cove r th e m^orit y o f

case s Involvin g violation s o f th e HMR

. Th e fact s an dcircumstance s o f aparticula r

case , bovvever

. ma y Justif y eithe r a n upvifar

do r downwar d departur e fromth e Matrb c ranges. Thi s

. sanctio n guidanc e anticipate s an d encourage s departur e fromth e Matri x range s whe n justified

. A cas e involvin g violation s i n whic hth e nature , circumstances , extant ; an dgravity o f th e inciden t ar e particularl y sever e o r egregious , ma y Justif

y upwar ddepartur e fro mth e Matrix

. If

th e investigatin g agen t believes , base dupo n th e fects o f acase , tha t

apenalt y shoul dexcee dth e Matri x ranges , th e agen t

shoul dconsul t wit hlega l counse l befor e furthe r processin g ofth e EK

. Conversely , th e investigatin g agen t

ma y believ e that mitigatin g factor s Justif

y adownwar d departur e fromth e Matrt x range , Consultatio n wit hlegal counse l i s no t necessar y i n th e cas e o f

arecommende d penalt y tha t

i s les s tha n tha t

provide d i n th e Matrix , I n eithe r

situation , Iiowever , th e agen t

i s t o provid e e detaile diss^Ianatio n o f

th e basi s for

th e decisio n t o g o outsid e th e ranges , 4 , Violation s o f

Par t 17 S regulations , ^^Wc hestablis hparticiHar

requirement s fo r ai r carrier s an doths r

obvrat t operators , ar e containe di n aseparat e matrix

. However , suc hope^ator s often ofl ^ Hazma t

for ai r transportatio n a s wel l a s accep t

an dtranspor t

it

. A s such , th e operato r

ma y b e liabl e fo r

violation s a s abmlnes s entit y vsrithi n th e mai n Matri x a s wel l a s fo

r th e Specifi c Part 17 5 Violations

. m
. Impac t

o f Othe r Statutoi y Factor s Th e Federa l haawdou s materia l transportatio n la w als o require s consideratio n of aviolator' s abilit y t o pa y acivi l penalty , th e impac t o f th e civi l penalt y o n th e violator' s abilit y D O

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continu e t o d o business , an dothe r matter s chat

Justic e requires , Considaratio n o f

thes e factor s ma y resul t In adjustmen t

ofth e recommende dclvl ] penalt y calculate d i n Sectio n n
. I n situation s wher e th e agen t o r attorne y i s i n possessio n df -mttJgating^vfcmatiohrswI^BMftabiHty

to pa y th e recommende ddvi l penalt y o r correctiv e actio n taken , reductio n of th e recommende dpenalt y mayb e appropriate

. Mitigatin g InfOmiatiD n shoul db e sufUclenO y reliable , uncontroverted , an ddocumente di n orde r t o suppor t

reductio n of

th e recommende dcivi l penalt y prio r t o issuin g th e Notic e o f

Propose dCivi l Penalty

. A

. Abilit y ToPay/Co/jttnu e i n Busines s Historically , th e FA

A ha s considere d thes e factor s after

ti^ issuanc e of

di e Notic e of Propose dCiv

U Penalt y du e t o th e absenc e of

reliabl e flriancial informatio n o n whic ht o bas e a reductio n prio r

t o th e issuanc e of a Notice , Thi s Sanctio n Guidanc e recommend s tha t

th e specia l agen t

rm'k e effort s t o obtai n reliabl e informatio n reganain g th e violator' s siz e ai>d ' financia l conditio n fo r

revie w prio r

t o th e issuanc e of

aNotice , Thi s informatio n vvlll b e transmitte dt o th e lega l offic e for

consideration

. I t

i s recognize dtha t

I t ma y no t alway s b e possibl e fo r

th e specia l agen t

and/o r attorne y t o obtai n reliabl e financia l informatio n o n aparticula r respondent , tha t financial circumstance s chang e an d tha t informatio n ma y b e provide dafter tiie issuanc e o

f th e Notic e tha t

ma y warran t furthe r consideratio n o f

a respondent' s abilit y t o pay
. 1

. Th e investigatin g agen t wil l attemp t t o indud e financia l Informatio n a s a n exhibi t i n th e EIR

. I t

i s anticipate dtfiat thi s information , i f

avaOrfkle , wil l b e obtaine dfro mreliabl e financial da U bases , Financia l documentatio n shoul d Ixidude

. bu t

nee dno t b e llmlto dto.

- und w th e Sma U Busines s Regulatnty liifoiTO-aBSfi^oRGerrfngtli^vl^asf:*^ ^ corporat e structure , busines s address

. ofHcers , numbe r

o f employees , an d gros s revenues. Z

. Th e investigatin g agen t provide s a Statemen t o r commen t

wit hrespec t

t o consldet^o n of

arespondent' s financial claim s afte

r issuanc e ofth e Notice

. 4

. I f lega l counse l determine s tha t a responden t

qualifie s a s asmal l busines s entity , counse l trB y conside r tha t statu s

th e financia l informatio n obtaine dbu t ordinaril y doe s no t

evaluat e th e financial conditio n o f

aresponden t

wit h respec t t o It s abilit y t o pa y apropose d dvi l penalty

. Th e investigatin g agent' s statemen t shoul dencompas s area s suc h a s th e numbe r

of employees , gros s revenues , an dnatur e o f

busines s o f

th e violator

. 3

. PA A lega l counse l reviews th e financia l informatio n provide di n th e EIRan devaluate s It s suillclenc y at) d relevanc e t o th e recommende ddvi l penalty

. Lega l counse l ma y determin e i f mor e curren t

informatio n exist s concernin g th e financial conditio n o f a responden t

an dI f tha t Informatio n substantiall y differ s frtimth e informatio n availabl e a t

th e dm e o f preparatio n o

f th e HR

. I f

ther e i s abasi s for determinin g tha t

th e reconwnende d sanctio n i s inappropriat e base dupo n th e financia l informatio n provide di n th e EIR , th e recommende dsanctio n i s adjuste dprio r

t o issuanc e ofth e Notic e of Propose dCivi l Penalty , Thi s i s a preliminar y consideratio n ofa company' s abibt y t o pay
. A s such , ps« - Notlc e adjustmen t

of arecommende d Civ U penalt y doe s no t

preclud e furthe r MATRI X AN D DEFINmON

S IFHjur e 1 ] witi i respec t t o th e appropriatenes s o f th e reconunende ddvi l penalty

. A respondent' s statu s a s asmal l busines s entit y ma y b e considere di n conjunctio n vrii hanalysi s of

th e statutOty factoid

. B

. Carrectfv e Actio n Th e mos t commo n "othe r

matter " tha t th e FA A take s int o consideratio n i s correctiv e action

. Correctiv e actio n tha t result s i n mitigatio n i s remedia l actio n tha t exceed s th e minimu mlega l requirements

. Th e primar y factor s i n detenninin g th e appropriat e amoun t of penalt y reductio n ar e th e exten t an d tirnin g o f th e corectiv e action

. I n othe r words.'mitigatio n i s determine do n th e basi s o f ho w muc hcorrectiv e actio n wa s take n an dho w quickl y tiie actio n wa s taken

. Systemi c chang e Intende dt o preven t futur e violation s shoul db e give n greate r

consideration

. Similarly , correctiv e actio n tha t

commence s upo n th e violator' s firs t

notic e of th e violatio n ordinaril y i s give n greate r credi t tha n cwrecUv B actio n Oa t

commence s onl y after th e Notic e of

Propose dCivi l Penalt y ha s bee n Issued

. Mitigatio n o f

areoommentie dcivi l p«5nalt y base dupo n correctiv e actio n
. Shoul db e reference di n th e Notic e o f Propose dCiv

U Penalt y s o tha t

th e responden t

i s o n notic e tha t

credi t alread y ha s bee n give n for sai daction

.

OKense categorie s

I , Declare d Shipmoni : 1

. Shippin g Paper s - 2

. Label s 3

. MarWng s , _- 4

. Pactegh g ..,.- . „... . 5

. Trainin g - .,,... . 6

. Emeig

. Respons e —, 7

. Releas e Int

o Enviro n , . 8

. Othe r^....

_, - II

. Undeclare d Shipmen t WHN n Haana i QuarW yLknltallons : 1

. SNppIn g paper s

_... . 2

. Label s ,„ . -.. . n..

. —.,..•..•.„.„.-..,.•. ' 3

. Mart<lrig s

_-. „ ..,.,._...,.. . , PW*aglrt g

_, . -. , Trainin g Emerg

. Respons a

. — Releae s int o Envlio n Othe r„., . A , Individua l

250-50 0 250-50 0 250-SO O 250-50 0 250-50 0 250-5D D 250-50 0 250-1,000 250-1,00 0 260-1,00 0 250-1,00 0 250-1,00 0 25O-1.O0 0 250-1.00 0 3

. BuslrMs e entit y

250-1,OD D 250-1,00 0 2SO-1.0O O 250-1.00 0 250-1,00 0 250-1.00 0 250-1,00 0 250-1,00 0 1,500-7,500 1,500-7,500 1,500-7,500 1,500-7,500 1300-7,50 0 1,500-7,500 1.500-7,500 1,500- 7 ,SO D C , Busines s entit y iha t use s o rhan

dle s Hazma t i n th e cours e o f busi

rtes s
500-2,00 0 SOD-2,00 0 500-2,00 0 £00-2,00 0 SOD-Z,OD

Q 500-2.00 0 500-2,00 0 S00-2,QD O 2,500- 1 D.DO

D 2.500-10,00 0 2,300-10,00 0 2300-10,00 0 2,500-10,00 0 2,500-10.00 0 2,500-10.00 0 2,300-10.00 0 D

. Bualnea e entit y

tha i regularl yof

iefs , Bocaplfi , O

f transport s Hazma t

1,000-5,00 0 1.000-5,00 0 1.000-5.00 0 1,000-5,00 0 1,000-5.00 0 1.000-5.00 0 1.DO0-6.0D 0 1.000-5,00 0 5,000-12,000 6,000-12.000 6.000-12,000 5,000-12.000 5,000-12,000 5.000-12.000 5,000-12.000 5,000-12.000

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1944 S Fedtern l Rcgistfcr/Vol

. 64

. No , 7 6 /"Wfednesday , Apri l 21 , 1999"/Rule s an dRegulation s MATRI X AN D DEFiNmoNS—Contitiue d

{Figur e 1 ]

Offens e categorie s

III

. Undeclate d Shipmen t Hazma t Forbidde n on , o rexceed s qt ylimit s for

. Passenge rAbcieft ; 1

. Shlppirif l Paper s „,... „ , ^..

. 2

. Label s - _. „ 3

. Marldns e , „. . » 

### 4

. Packagin g
_1,... , 5

. Trainin g - , - 6

. Emarg , Respons e

. , _.. , 7

. Releas e int o Enviro n „. , 8

. Othe r, . IV

. Undeclare d Snipmsn t Foibldde n on , o rexceed s ql ylimit s tor , AR Aircraf t 1

. Shippin g Paper s , 2

. Label s 3

. MarKng s » - , « 4

. Paciagin g -... ; •....,„.„.
. 5

. Trainin g -. - 6

. Emetg , Respons e

_ - 7

. Releas e Into Emriro n
.. „ -.... „ _ 8

. Oltw r„ „.,.. „ __„ V

. IntentlQna l o rDeliberat e Vlolallo n -..... _ A

. IndhMua l

500-5,000

. 500-5.00 0 500-5,00 0 500-5,00 0
500-5.00 0 500-5,00 0 500-5,00 0

500-27,50 0 500-27,50 0 500-27,50 0 500-27,50 0 501^27,50 0 500-27,50 0 500-27,50 0 Consul t Lega l B , Buxlnes s entit y

5,000-15,00 0 5,000-15,00 0 5,000-15,00 0 5,000-15,00 0 5.O0O-15.OQ 0 3,000-15.00 0 5,000-15,00 0 5,000-15,00 0

7,500-27,50 0 7,500-27,50 0 7,500-27,60 0 7,600^27,50 0 7,500-27.60 0 7.500-27,50 0 7.500-27,50 0 7.500-27,50 0 

### Consul t Lege l C

. Bun'nm s entit y tha t uae s o t han

dle s Hamo i i n th e cours e o f busl

- • nea s

7.500^0,00 0 7.500-20,00 0 7.EOO-2D.O0

0 7.500-20,00 0 7.500-20,00 0 7.500-20,00 0 7,500-20,00 0 7.500-20,00 0

10,000-27,50 0 10,000-27,50 0 10,000-27,50 0 10,000-27.50 0 10,000-27,50 0 10,000-27,50 0 10,000^27,50 0 10,000^7,50 0 Oons'u M Lega l D

. Busines s entit y

(ha t regularl yof

fers, acc^ls

. o r 

### San»pons_Ha»iw.l

_

10.000-27,50 0 lQJ)00-27.5o a 10,000-27,50 0 10.000-27,50 0 10.000-27,50 0 10,000-27,50 0 10,000-27,50 0 10.000-27,50 0

15,000-27,50 0 15.000-27,50 0 15.000-27,50 0 15,000-27.50 0 15,000-27,50 0 15,000-27,50 0 15,000-27.50 0 15,000-27,50 0 

### Consul t lega l

Ai rcarrie ran d othe raircffif i operato rviolation s

Failur e t o compl ywtS i Pari s 171.172 , o r17 3 requirement s o f th e HM R a s a n oRero ro f Hasma t Imprope racceptanc e o f Hazma t Ib r«j rtransportalla n (I.e. , quantity , labeling , meiUng , padaglng , an d ahlppin a papers ) Se e <» 9 CF R 175,30(a ) (1H4 ) - : Fallui « l o Inspe d Hazma t shlpmon t properly , Se e 4 9 CF R 175.3 0 (b) , (c) , <d) , (e ) 

### Imprope r storsge/s^eurin

g o f Hazma t aboan i aircraf l ,.. _ Failur e t o provid e Haema l bolnlng , nte'inta m record s o f training , o rmee t m'mimui n i^uiremant s fi x Haana t trainin g , , , . . ' _.,, . Failur e to notif yFA A properl yo f inddent/dlscrepancle s i n Hasna t shipmon t , „ FeUur e l o ptovid e nc<lcet o Ih e pllpt-ln-oofninan d

_, , Othe rPar t 17 5 vlotellon s „ „

' ' Us e mai n Matrix

. E Qreu p I & I I ai r caTTlar s an d Othe r aircraf t operator s

5.000-27.50 0 10.000-27.50 0 10,000-27,50 0 10,000-27,50 0 5,000-15,00 0 5.000-15.00 0 5.00D-15.00 0 F , Grou p II I & I V

ai rcanrler s an d othe raircraf t oper ator s

2.500-15,00 0 5,000-15.00 0 5.000-15,00 0 6,000-15,00 0 1,000-6,00 0 1.000-5,00 0 1.000-5,00 0



### 0efl.raUgn 9 (a ) Air Carrier an dOther

Aircraf t Operator Croup s (I

. U

, m
. iVJ—Ai

r carrier s an dother

aircraf t operator s ar

e divide dint o tw o categorie s fo r purpose s o f determinin g a

n appropriate sancrior

L Thes e categorie s trac k

th e ai r carrie r group s establishe din FA

A Orde r No

. 2150,3A , Appendi x 1 , Compliance / Enforcemen

t Biilleti n 92-1 , but

als o Include s any operato r

of a n aircra ^ tha

t i s operate d"I n comrneroe " a s definedin th e Fedei ^ hazardou s material s law , includin g Par

t 129 For^g n Air

Carriers , Par t 12 5 Operatois , an dPar

t 9 1 Operators

. Grou

p I i s comprise do

f ai r carrier s an dothe r

aircraf t operator s wit

h annual operatin g revenu e ol ' SI60,1x0,06 0 o r

more
. Grou

p I I i s comprise do

f ai r carriex s an dothe

r aircraf t operator s that

hol dFar t IZl ' certificate s o

r hav e 50'o r

mor e pilot s o r operate 2 5 o r

more aircraft , wit

hannua] operatin g revenu e o f les s than $100,000,000

. Grou

p II I i s comprise do

f air carrier s an dothe

r aircraf t operator s tha t d o no t meet th e criteri afo

r Crou p n wlti i (1 ) 6 to 49 pilots , o

r (2 ) 6 t o 2 4 aircraft

. Croup I

V i s comprise do

f ai ] othe r ai r carrier s o r aircraf t operator s not meeting th e criteri afo

r Group s 1,1 , orH

. ftO Busines s Entity—Th

b violato r i s a business , corporation , partnership , 5ub

S Corporation , sol e proprietor , association , or

an y type o f commercia

l entity

. A n individual wh o offer

s a hazma t shipment i n air trattsportatio n i n th e cours e o

f his/he r self-owned busines s fall s Int

o thi s category

. Include s al l entitie s definedunde r th e HMR' s definitio n o

f "person. " (4

9 CF R 171.8) wit hth e exceptio n of

a n Individua l a s definedherein , (c ) Busines s Entit

y that Regularly Off^ , Accepts , o r

Transport s Hazardou s Material s i n th e Cours e o

f It s Business.—

A manufacture

r d r distributo r o f Haona t fejls Into thi s category

. A freigh

t forwarde r wouldals o fall int o thi s categoty

. Th

e aspec t o f

. "regularly " offerin

g cover s abusines s entit y that offer s Hazma t vric h som e anticipate dfrequency o

r purport s to d o so , e.g. , acatalogu e compan y tha t ofiets hazardou s material t o it s customer s woul dfal l int o thi s categoiy.evc n thoughit s aaua l sal e o

r transportatio n o f the Hazma

t j s infrequen

t o r limited

. {d ) Busines s Enaty tha

t Uses , HsndJe s Hazma t i n th e Cours e o

f It s Business

— Thi s categor

y encompasse s th e busines s that utilize s Hazma

t i n It s busines s bu t doe s 730 ^ offe r i t fo r transportatio n o

n a regula r basis , a s describe dabove

. Fo r example , arnanufacture

r o f ahon

Hazma t produc t tha t use s Hazma

t I n th e manufacturit ^ proces s coul dfal l into thi s category

. It

mus t b e establishe dcha

t

### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAG E 15/1 6

Federa l Repster/Vol

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. 76/Wednesday , Apri l 21 , 1999/Rule s an dRegulation s 1944 9
tiie compan y ordinaril y doe s t»ot offer th e Hazma t

It utilize s far

transportation , aiu j th e shipmen t

i n thi s instanc e represent s a n isolate dInciden t Thi s typ e o f busines s i s hel dt o ahighe r standar dtha n th e busines s entit y tha t has_nO regula r

involvement^with

_ receive s th e subjec t

hazardou s materia l i n transporiaUo n an duse s i t i n it s business : thus , i t

i s clearl y o n notic e o f th e hasMirdDir

t natur e ofth e materia l an d th e regulator y requirement s t o whic h th e Hazma t

i s subject

. (e) Declaiv dShipment— A declare d shipment , fo r

purpose s o f

thi s matri x only , i s on e tha t

complie s vrithon e o r rnor e o f th e communicativ e requirement s o f

th e HMR , Le.

. i t

ha s markings , labels , and/o r partially

correc t shippin g papers
. A packag e tha t ha s shippin g paper s tha t declar e th e content s a s ho&irdou s materia l bu t i s othervrise'no t

mai);e do r

labele dfall s int o thi s category

. Similarly , aproperl y marke dan dlabele dpacJcag e tha t lack s shippin g paper s als o Mi s int o thi s category

. A cas e fiall s int o till s categor y wher e ther e I s clear

indicatio n ths t

th e offero r mad e som e attemp t

t o giv e notic e o f th e hazardou s natur e o f th e shipmen t (f ) Forbidde n o rExceed s Quanat y Umit s fo rPasseager.Alrcraft— A shipmen t fall s int o thi s category if th e quantit y o f

Hazma t pe r paduig e exceed s th e quantit y limitations/orpasseng^r

carryin g alrcrai t

o r if th e particula r hazardou s matrala l i s forbidde n i n ai r transportatio n o n passenge r aircraft

. (g ) Forbidde n o n o r

Exceed s Quantit y —amfts^foTTW-j'aricnfff^^^Ashlpm ^ fal l Int o thi s categor y I f

th e quantit y o f hazardou s materia l pe r

pacl»g e exceed s th e aUowabl e arnoun t

for bot hpassenge r an dcarg o aircraf

t o r th e Hazma t

i s absolutel y forbidde n In ai r transportation

. (h ) Hazmst— A "hazardou s material, " a s define di n 4 9 CF

R171,8 , include s an di s interchangeabl e wicj i th e ter m "dangerou s goods , " a s use dI n th e Internationa l Civi l Aviatio n Organizatio n (ICAO ) Technica l Instructions , (1) Individual—A n Individua l wh o offer s ashipmen t

of hazardou s materia l i n his/he r

persona l capacit y wltfiou t an y busines s purpos e o r

a s par i of

a commercia l enterpris e o n th e par t o f th e ' IndfVldua

L (1 ) Intentiona l o r

Deliberat e Violation—A ahlprrwn t

fall s int o thi s categor y whe n ther e i s evidenc e that , th e offeror , acceptor , ai r

carrier , o r

aircraf l operato r ha dknowledg e o f

th e requirement s o f

th e HM Ran dwillfull y circumvente do r

attempte dt o RIS KCATEGORIE S

. [Figure 2 ) circumven t thos e requirements

. Fo r example , a n offero r

wh o place s a properl y marke dan dlabeled " Hasma t shipmen t alon g wit hproperl y complete dshippin g papers , int o a n overpac k nwrke da s "printe dmaterial, " ha s committe da n intentiona l o r <iMlKerate->^Tatlon;."lft-aila4yp e of CBB6 ^ Ch e Investigating'agerkt

shal l consul t wit hFAA lega l counse l an dfollo w agenc y guidanc e fo r

potentia l crimina l violation s o

f th e HMR , (k ) Undeclare dSi^pznenr—Thi s i s a shipmen t tha t ha s n o indicatio n o

f it s hazardou s tnaterla l content s and/o r n o indicatio n cha

t th e offeror communicate dth e hazardou s natur e o f th e shipment' s content s t o person s wh o accep t o r trartsporL (I ) Witht o Hazma t

Quantit y Limitations—Th e amoun t o f hazardou s materia l i s withi n th e quantit y limitation s pe r

packag e a s establishe di n th e § 172,10 1 Tabl e (4 9 CF R172-101 ) fo

r th e typ e of

aircraf t o n whic hth e shipmen t traveled

. Fo r

example , i f

th e shipmen t wa s offere dfor

transportatio n o n apassenge r

aircraft , th e quantit y o f hazardou s materia l wa s withi n th e establishe dlimi t

fo r transportauo n b y passenge r

aircraft

. If

th e shipmen t

wa s offere dfo r transportatio n o n acarg o aircraft , th e quantit y limitation s for carg o aircraf

t apply

.

CBteaor y"A " (Maximu m Weight ) Categor y"A " mateilai s ar e material s tha t whe n release d h i th e confine s o f a n alnaef l ca n potentiall yhav e a catastrophi ceifec t o n a n eir

CTBfi's abnh yt o continu e saf e iRoh L resuHin g i n a oas h o renwrgenc ylandin g causin g injur yo rdeat h to paasenget s an d nightcrew , a s we n a s person s o n Ih a ground

. Clas s 1 „„ . Explosives : Divisio n 1.1 , (JS , 1.3 : Clas s 2 „ CDiiqMBBse d QBBS B Al l 2.1 , 2. 2 vril h Subsidlai yRis k 5.1 ' an d Al l 2. 3 PI H Zone s A-0

. Clas s 3 Flan>.mabl a Liquid s P( 3 I , II , an d (PIH) , Clas s 4 „ Divisio n 4- 1 Flemntabl e Solid s P G t , & (Maiches) , Divisio n 4. 2 Sponianeoual yCombuaHbl e Material s F> G I (Pyrophorie)

. Divisio n 4. 3 Dangerou s Whe n Wo t P G I , . . Clas s 9 , > Divisio n S. 1 Oxidtzin g Liquid s an d Sdld a P G i , 11 , e.g. , "Chemica l Oxyge n Qeneratois" , Dlvtak m 6. 2 Organi cPeroxide s P G I I (Typ e A B , C , o rD) , Clas s $ DMsk m 6, 1 Poisonou s Liqukf s P G I (PIH)

. Clas s 7 Caro o Aircral l Onl yQuantifie s o n Passenge rAircraft , Class, 8 Corrosiv e Materia l Liqui d P G I an d (PIH)

. Forbidde n Material s (Se e 4 9 CF R ir3.2 i & fCA O Tecnmca l Instnjctlons)

. Forbldds n Hazma t liste d I n Dangerp m Good s Tabl e 4 9 CF R 172.101

. Categor y"H " (Moderat e Waight ) Th e matertal e lisle d i n Categor y"B " ar e matorial B Ihe l ma yno t pos e e n imnwdlat o threa t t o th e safet yo T e flight , bu t ca n eaus a deat h o rIn

jur yt o person s du e l o unlnlende d release e t n aircraf t cabi n areas , en d potenda i damag e t o aircraf t structure s ove ra longe rperio d o f lim e du a l o undiscovere d release * o n sifcrai t structura l compbnentB

. Clas s 1 Clas s 3 Clas s 4

Clas s & Class ? Divisio n 1.4,1.5,1.0 , Al l Compatibilit yGroups

. P G II I Flammabl e Liquids

. DMslo n 4, 1 mammabl e SoKd a P S II , III

. Divisio n 4. 2 Spontaraousl yCombustibl e Matsriai s P G III

. Divisio n 4, 3 Dangarou e Whe n We i P G II , III

. Dhrtsto n 5, 1 Oxidizin g UquU s o rSoltd s P G III

. Dhrlsle n 6, 2 Organi cPeroxide s (Typ e E , F , Q)

. Divisio n 6. 1 Poisonou s Liquid s P G I , I I (NON-PIH) , Divisio n 6. 2 infisetiftu e Substances ,

### 04/25/201 1 13:2 7 425227100 7 ANM 7 PAQ E 15/1 6

1945 0 Pedeira l Register/Vol , 64 , No , 76/Wednesday , Apri l 21 , 1999/Rule s an dRegulation s

RIS KOTEQORIES—Continue d

IFigureaj Clas s 7 Clas s 8 RadloacBv e Materials , yellow tabe

t III , yellow bba l II , an d white labe l I

. Liquid s P O II

. Il l SoRd

s P G I , II , lit

. Cataffor y"C " (Mnlmun i Weight ) T7 M mafBna » nsia

a m (^aregar

y Clas s 2 ClasG 6 — Claa a .7.

. Clas s S , „ "C " srmstsnsisinsrptsBst a ThB-iaas t jmoun t o f nsmt rt 2. 2 Nonflammabl e Gas , DIvlsfa n 6, 1 packin g Grou p III , Al l othe rFtAM (LSA , LI D QTY , Insbument B an d Arfidea) , MiaceilanBou s Dangerou s Good s (ORM ^ an d Conaume rCommodity)

. Note : Thi s guidance I s not intended , t o replac e th e expariance d Judgmen t t o a specia l agen t wh o I s convinced , base d o n th e cvideno e an d fact s o f 8 oase , that th e failur e o f a n ai rcarrier , shipper , freigh t ibiwarder , o rpassenge rt o follo w establishe d regulailon s ha s pMc d a ris k l o aviago n aafely

.
Issue dIn Washington , P C o n Apri l 14 , 1999 , lan e F

. Carvcy , Ad/THJtlstr»tw , (F RDo c 9S-99B 3 PUe d4-20-99 ; B;4 5 am ] SIU-IM Q con e 4t1>-1s- M

SECURITIE S AM D EXCHANG E COlMMISSIO N 1 7 I:F R Part s 2D2,240 , 24 2 an d 24 9 [Releas e Uo

. 34-41297 ; Fil e No

. S7-12-«8 ) RI N 3235^AH4 1 Regulatio n o f Altentatlv e Tradin g Systems ; Technica l Amendmen t AGENCY : Securitie s an d Exchang e CojimiissJoo , ACTION ; Fina l rule ; technica l amendmEn t an drevise dcomplianc e date

. SUMMARY : Th e Securitie s an dExchang e Commissio n i s modiiyin g th e complianc e date s fo r

Rul e 301(b)(3 ) an d makin g atechnica l chang e t o Rul e 202.3 , Thes e an dothe r

rule s an drul e amendment s relat e t o th e regulatio n o f alternativ e tradin g system s an d exchange s an dwer e publishe do n Decembe r

22.199 8 (6 3 F

R70844)

. Th e effectiv e dat e for

th e othe r

rule s an d amendment s publishe di n 6 3 FR7084 4 remain s Apri l 21,1999 , excep t for th e effectiv e dat e fo r

§§Z42.30I(b)(5)(i)(D )

. an d(E 3 ant l § § 242.30 1 (b)(6)(i)p ) an d (E) , whic hremain s Apri l 1,20(30 , OAT^s : Effectiv e Date : Apri l 21 , J 9& 9 fo r amendmen t

t o § 202.3

. Complianc e Date : Alternativ e tradin g system s mus t

compl y wit h §242.30 1 (b)(3 ) \vit hrespec t t o th e 5 0 securitie s liste di n Schedul e A b y Augus t Z3,1999 ; wit hrespec t

t o th e securitie s liste do n Schedule s A an dB b y Septembe r

23

. 1999 : wit hrespec t

t o th e securitie s liste do n Schedule s A , B an dC b y Apri l 25 , 2000 ; an dwit h respec t t o al l Securitie s b y Jun e 20 , 2000

. FO R njRTHE R INFORMATION COHTACT: ElizabethKing , Senio r

Specia l (kiunsel , a t (202 ) 942-0140 , Constanc e Klggins , Specia l Counsel , a t

(202 ) 942-0059 , an d Kevi n Ehrlich , Attorney , a t (202 ) 942

- 0778 , Divisio n o f

Marke t Regulation

. Securitie s an dExchang e Camml£$ian , 45 0 Fift hStreet , N,W „ Weshlngto aD.C

. 20549-1001 , SUPPLEMEHTAR YINFORMATION :

' I , Backgroun d O n Decembers , 199S , th e Securitie s an dExchang e Commissio n ("Commission" ) adopte dne w rule s en d rul e amendment s t o allo w aJtematlV B tradin g system s t o choose,whethe r t o registe r a s ruitlona l securitie s exchanges , o r t o registe r

a $ broker-dealer s an d compl y wit hadditiona l rei^lrement s unde r Regulatio n ATS , dependin g o n thei r activitie s an dtradin g volume, ) Th e electiv e dat e fo r

mos t o f thes e ne w rule s an drtil e amendment s i s Apri l 21 , 1999

. Th e Commissio n state di n th e adoptin g releas e that , prio r t o Apri l 21 , 1999 , i t woul dpublis halis t

of thos e sectultle s wit hrespec t

t o whic h altarnativ e tradin g systerr u mus t compl y wit hRul e 30 1 (b

) (3 ) o n Apri l 21 , 199 9 an dthos e securitie s virjc

hrespec t t o whic heJtematlv e tradin g system s mus t compl y wit hRul e 30 1 (b

) (3 ) o n Augus t 3D

. 1939 , Rul e 301(b)(3 ) require s a n alternativ e tradin g syste mt o provid e t o anationa l securttie ; e'^chang e o r

. nadona l securitie s association , fo r inclusio n i n th e publi c quotatio n system , th e price s an dsize s o f It s bes t price dbu y an dsel l orders , tha t ar c displaye dt o n^or

e tha n on e person , i n eac hcovere dsecurit y i n whic hth e alternativ e tradin g syste mrepresent s 5 % o r mor e o f th e tota l tradin g volume^ '

I Svcuriae c Exchnng e Actt^dim M No

. 4076 0 (Dec

. B , laSS) , 6 3 PRraS« 4 JPtu , tZ

. 199^

. > 1 7 CF R242.30 1 (b)(3)

. Ferpurpgte f o r KaguUktlon

i ATS , a"eov«re djeeurhy " Include i al l eurhante-llstod , Nvcdi qNM BKuriUcs

. en dNasda q Smi n Cap ttcurltlds, othe r tha adgb t

an d «ODvertlMe aecurlUN

. S mRul e 1 1 Acl- l M(S) , I T J LDela y o

f th e CompUanc e Date s fo r Rul e 301(b)(3 ) On e majo r

alternativ e tradin g syste m ha s irxlicate dtha t

i t wil l b e unabl e t o compl y wit hth e rettuiretnent s o f Rul e 301^ ) (3 ) b y th e origina l complianc e date s withou t

puttin g th e operatio n of it s syste mat

seriou s risk

of failure

. Th e operatlona ] failur e o f

araEjor alternativ e tradin g ^stc mcoul dinteifer e wit hth e market s a s awhole

. Accordingly , th e Commissio n believe s i t

necessary t o adjus t th e complianc e date s for Rul e 301(b)(3 ) a s follows : Augus t 23,1999 ; Cojnpllanc e wit h Rul e 30 1 (b)(3 ) wit hrespec t t o th e S O Nasda qsecuritie s liste do n Schedul e A , attache di n th e appendix , Septembe r

28,1999 ; Complianc e wit h Rul e 30 1 (b)(3 ) for

th e 50 % of

Nasda q securitie s liste do n Schedule s A an d6 , attache di n th e appendix , Apf U 25 , 2000 : ComplJafjc e wit hRul e 30 1 (b)(3 ) fb

r th e 75 % o

f Nasda q securitie s liste do n Schedule s A , B , an d C , attache dI n th e appendix

. Jun e 20 , 2000 : Complianc e wit hRul e 30 1 (b)(3 ) fo r

al l Nasda qsecurities

. Schedule s A

. B , arx l C wer e create d l7 y rankin g al l covere dsecuritie s trade d o n Nasda qb y thei r

Januar y 199 9 volume , an dincludin g a n equa l numbe r of setnjritie s fro meac hdecile

. Som e securitie s tha t

wer e no t trade da n Nasda qi n Januar y 199 9 may commenc e tradin g o n Nasda qsubsequently

. Alternativ e tradin g system s may wai t unti l Jun e 20 , 200 0 t o compl y wit hRul e 30 1 (b ) (3 ) wit hrespec t

t o thes e securities

. Al l Othe r complianc e date s for

th e rule s an drul e amendment s adopte dlas t Decembe r

remai n th e same
. Th e Commissio n encourage s thos e alternativ e trBdln g system s cha t ar e abl e t o compl y wit hRul e 30 1 (b)(3 ) o n Apri l 21 , 199 9 t o d o so
. CFR24D,tlAc1-'l(a)(6):Rule30[l(d' , ITCF R £42.300(1)

.