67032 Federal Register / Vol. 71, No. 223 / Monday, November 20, 2006 / Rules and Regulations 

C. Executive Order 12988: Civil Justice 

Reform 

This final rule has been reviewed in 

accordance with Executive Order 12988, 

Civil Justice Reform. This rule does not 

preempt State or local laws, is not 

intended to have retroactive effect, and 

does not involve administrative appeals. 

D. Executive Order 13132: Federalism 

This final rule does not have 

sufficient federalism implications to 

warrant the preparation of a Federalism 

Assessment. Provisions of this rule will 

not have a substantial direct effect on 

States or their political subdivisions or 

on the distribution of power and 

responsibilities among the various 

government levels. 

E. Unfunded Mandates Reform Act of 

1995 

This final rule contains no Federal 

mandates under the regulatory 

provisions of Title II of the Unfunded 

Mandates Reform Act of 1995 (UMRA), 

2 U.S.C. 1531–1538, for State, local, and 

tribal governments, or the private sector. 

Therefore, a statement under section 

202 of UMRA is not required. 

F. Executive Order 12372: 

Intergovernmental Review of Federal 

Programs 

For the reasons set forth in the Final 

Rule Related Notice for 7 CFR part 3015, 

subpart V (48 FR 29115, June 24, 1983), 

this program is excluded from the scope 

of the Executive Order 12372, which 

requires intergovernmental consultation 

with State and local officials. This 

program does not directly affect State 

and local governments. 

G. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

Today’s final rule does not 

significantly or uniquely affect ‘‘one or 

more Indian tribes, * * * the 

relationship between the Federal 

Government and Indian tribes, or * * * 

the distribution of power and 

responsibilities between the Federal 

Government and Indian tribes.’’ Thus, 

no further action is required under 

Executive Order 13175. 

List of Subjects in 7 CFR Part 2902 

Biobased products, Procurement. 

■ For the reasons stated in the preamble, 

the Department of Agriculture is 

amending 7 CFR chapter XXIX as 

follows: 

CHAPTER XXIX—OFFICE OF ENERGY 

POLICY AND NEW USES, DEPARTMENT OF 

AGRICULTURE 

PART 2902—GUIDELINES FOR 

DESIGNATING BIOBASED PRODUCTS 

FOR FEDERAL PROCUREMENT 

■ 1. The authority citation for part 2902 

continues to read as follows: 

Authority: 7 U.S.C. 8102. 

■ 2. Revise paragraph (c) of § 2902.12 to 

read as follows: 

§ 2902.12 Water tank coatings. 

* * * * * 

(c) Preference effective date. No later 

than November 20, 2007, procuring 

agencies, in accordance with this part, 

will give a procurement preference for 

qualifying biobased water tank coatings. 

By that date, Federal agencies that have 

the responsibility for drafting or 

reviewing specifications for items to be 

procured shall ensure that the relevant 

specifications require the use of 

biobased water tank coatings. 

■ 3. Revise paragraph (c) of § 2902.15 to 

read as follows: 

§ 2902.15 Bedding, bed linens, and towels. 

* * * * * 

(c) Preference effective date. No later 

than November 20, 2007, procuring 

agencies, in accordance with this part, 

will give a procurement preference for 

qualifying biobased bedding, bed linens, 

and towels. By that date, Federal 

agencies that have the responsibility for 

drafting or reviewing specifications for 

items to be procured shall ensure that 

the relevant specifications require the 

use of biobased bedding, bed linens, and 

towels. 

Dated: November 14, 2006. 

Keith Collins, 

Chief Economist, U.S. Department of 

Agriculture. 

[FR Doc. E6–19587 Filed 11–17–06; 8:45 am] 

BILLING CODE 3410–GL–P 

DEPARTMENT OF AGRICULTURE 

Rural Business-Cooperative Service 

Rural Utilities Service 

7 CFR Part 4279 

RIN 0570–AA54 

Business and Industry Guaranteed 

Loan Program 

AGENCY: Rural Business-Cooperative 

Service, USDA. 

ACTION: Final rule. 

SUMMARY: Rural Business-Cooperative 

Service (RBS) amends its regulations for 

the Business and Industry (B&I) 

Guaranteed Loan Program by modifying 

the regulation regarding personal and 

corporate guarantors. This action will 

standardize the guarantor process. The 

Agency has created a guarantor form 

which will be used to obtain the 

personal or corporate guarantee of 

anyone owning greater than 20 percent 

interest in the borrower. The effect of 

this rule is to allow the Agency to use 

all remedies available to pursue 

collection from guarantors, including 

offset under the Debt Collection 

Improvement Act. 

DATES: This rule is effective December 

20, 2006. 

FOR FURTHER INFORMATION CONTACT: 

David Lewis, Business and Industry 

Loan Servicing Branch, Rural BusinessCooperative Service, U.S. Department of 

Agriculture, STOP 3224, 1400 

Independence Avenue, SW., 

Washington, DC 20250–3224, telephone 

(202) 690–0797, or by e-mail to 

david.lewis@wdc.usda.gov. 

SUPPLEMENTARY INFORMATION: 

Classification 

This final rule has been reviewed 

under Executive Order 12866 and 

determined not to be significant and has 

not been reviewed by the Office of 

Management and Budget (OMB). 

Programs Affected 

The Catalog of Federal Domestic 

Assistance number for the program 

impacted by this action is 10.768, 

Business and Industry Loans. 

Intergovernmental Review 

Business and Industry Guaranteed 

Loans are subject to the provisions of 

Executive Order 12372, which requires 

intergovernmental consultation with 

State and local officials. 

Intergovernmental consultation is 

required in the manner delineated in RD 

Instruction 1940–J and 7 CFR part 3015, 

subpart V, ‘‘Intergovernmental Review 

of Rural Development Programs and 

Activities.’’

Civil Justice Reform 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. In accordance with this rule, (1) 

All State and local laws and regulations 

that are in conflict with this rule will be 

preempted; (2) no retroactive effect will 

be given this rule; and (3) administrative 

proceedings of the National Appeals 

Division (7 CFR part 11) must be 

exhausted before bringing suit in court 

challenging action taken under this rule. 


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Federal Register / Vol. 71, No. 223 / Monday, November 20, 2006 / Rules and Regulations 67033 

Environmental Impact Statement 

This document has been reviewed in 

accordance with 7 CFR part 1940, 

subpart G, ‘‘Environmental Program.’’

RBS has determined that this action 

does not constitute a major Federal 

action significantly affecting the quality 

of the human environment, and in 

accordance with the National 

Environmental Policy Act (NEPA) of 

1969, 42 U.S.C. 4321 et seq., this 

regulation is a Categorical Exclusion. 

Loan applications will be reviewed 

individually to determine compliance 

with NEPA. 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act 1995 (UMRA) of, Pub. L. 

104–4 establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local, 

and tribal governments and the private 

sector. Under section 202 of the UMRA, 

RBS generally must prepare a written 

statement, including a cost-benefit 

analysis, for proposed and final rules 

with ‘‘Federal mandates’’ that may 

result in expenditures to State, local, or 

tribal governments, in the aggregate, or 

to the private sector of $100 million or 

more in any one year. When such a 

statement is needed for a rule, section 

205 of UMRA generally requires RBS to 

identify and consider a reasonable 

number of regulatory alternatives and 

adopt the least costly, more costeffective, or least burdensome 

alternative that achieves the objectives 

of the rule. 

This rule contains no Federal 

mandates (under the regulatory 

provisions of Title II of the UMRA) for 

State, local, and tribal governments or 

the private sector. Thus, this rule is not 

subject to the requirements of sections 

202 and 205 of the UMRA. 

Regulatory Flexibility Act 

In compliance with the Regulatory 

Flexibility Act (5 U.S.C. 601–602), RBS 

has determined that this action would 

not have a significant economic impact 

on a substantial number of small 

entities. RBS made this determination 

based on the fact that this regulation 

only impacts those who choose to 

participate in the program. Small entity 

applicants will not be impacted to a 

greater extent than large entity 

applicants. 

Executive Order 13132 

It has been determined that, under 

Executive Order 13132, Federalism, this 

rule does not have sufficient federalism 

implications to warrant the preparation 

of a Federalism Assessment. The 

provisions contained in this rule will 

not have a substantial direct effect on 

States or their political subdivisions or 

on the distribution of power and 

responsibilities among the various 

levels of government. 

Executive Order 13175 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments, imposes requirements on 

USDA in the development of regulatory 

policies that have tribal implications or 

pre-empt tribal laws. USDA has 

determined that the regulation does not 

have a substantial direct effect on one or 

more Indian tribe or on either the 

relationship or the distribution of 

powers and responsibilities between the 

Federal Government and the Indian 

tribes. Thus, this rule is not subject to 

the requirements of Executive Order 

13175. 

Paperwork Reduction Act 

In accordance with the Paperwork 

Reduction Act of 1995, the information 

collection requirements contained in 

this regulation has been approved by 

OMB control number 0570–0017. 

E-Government Act Compliance 

The Rural Business-Cooperative 

Service is committed to complying with 

the E-Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

Discussion 

Pursuant to the Debt Collection 

Improvement Act of 1996 (DCIA), the 

Agency is required to send the debt 

owed to the Government to the 

Department of the Treasury (Treasury) 

for collection. The DCIA covers both 

guaranteed and direct loans made by the 

Agency. Some ambiguity has existed 

regarding the Agency’s ability to collect 

from guarantors of the borrower’s loan. 

This rule will end that ambiguity by 

clearly making guarantors personally 

liable for any claims paid by the 

Government. 

The Agency will establish more 

uniformity in the guarantees being 

obtained by lenders. This should result 

in the program being administered more 

consistently and the Government 

recovering more of its loss claims. 

Currently, guaranteed lenders prepare 

non-uniform, personal, or corporate 

guarantees. When there is a loss on the 

guaranteed loan, the lender pursues 

these guarantees with mixed recovery 

results. By implementing this rule, the 

Agency will treat all guarantors 

consistently, collect more money on its 

loss claims, and rectify any ambiguities 

regarding its ability to refer these debts 

to Treasury. 

Comments on the Proposed Rule and 

Responses 

A proposed rule was published on 

April 7, 2005, [70 FR 17616–17618] and 

no comments were received. 

List of Subjects in 7 CFR Part 4279 

Loan programs—Business and 

industry—Rural development 

assistance, Rural areas. 

■ Therefore, chapter XLII, title 7, Code 

of Federal Regulations, is amended as 

follows: 

PART 4279—GUARANTEED 

LOANMAKING 

■ 1. The authority citation for part 4279 

continues to read as follows: 

Authority: 5 U.S.C. 301; 7 U.S.C. 1989. 

Subpart B—Business and Industry 

Loans 

■ 2. Section 4279.149 is revised to read 

as follows: 

§ 4279.149 Personal and corporate 

guarantee. 

(a) Unconditional personal and 

corporate guarantees are part of the 

collateral for the loan, but are not 

considered in determining whether a 

loan is adequately secured for 

loanmaking purposes. Agency approved 

personal and corporate guarantees for 

the full term of the loan and at least 

equal to the guarantor’s percent interest 

in the borrower, times the loan amount 

are required from those owning greater 

than a 20 percent interest in the 

borrower, unless the lender documents 

to the Agency’s satisfaction that 

collateral, equity, cashflow, and 

profitability indicate an above-average 

ability to repay the loan. The guarantors 

will execute an Agency approved 

unconditional guarantee form. When 

warranted by an Agency assessment of 

potential financial risk, Agency 

approved guarantees may also be 

required of parent, subsidiaries, or 

affiliated companies (owning less than a 

20 percent interest in the borrower) and 

require security for any guarantee 

provided under this section. 

(b) Exceptions to the requirement for 

personal guarantees must be requested 

by the lender and concurred by the 

Agency approval official on a case-bycase basis. The lender must document 

that collateral, equity, cashflow, and 

profitability indicate an above-average 

ability to repay the loan. 


sroberts on PROD1PC70 with RULES
67034 Federal Register / Vol. 71, No. 223 / Monday, November 20, 2006 / Rules and Regulations 

Dated: October 4, 2006. 

William F. Hagy III, 

Acting Administrator, Rural BusinessCooperative Service. 

[FR Doc. 06–9262 Filed 11–17–06; 8:45 am] 

BILLING CODE 3410–XY–P 

DEPARTMENT OF COMMERCE 

Bureau of Industry and Security 

15 CFR Parts 730, 738, 740, 742, 746, 

750, 752, and 774 

[Docket No. 050428118–5118–01] 

RIN 0694–AC82 

Imposition of Foreign Policy Controls 

on Surreptitious Communications 

Intercepting Devices 

AGENCY: Bureau of Industry and 

Security, Commerce. 

ACTION: Final rule. 

SUMMARY: The Bureau of Industry and 

Security (BIS) is amending the Export 

Administration Regulations (EAR) by 

imposing new foreign policy export and 

reexport controls on devices primarily 

useful for the surreptitious interception 

of wire, oral, or electronic 

communications classified under Export 

Control Classification Number (ECCN) 

5A980. In this rule, BIS also imposes 

controls on related software and 

technology by creating ECCNs 5D980 

and 5E980. BIS is taking this action in 

order to prevent the unlawful 

interception of oral, wire, or electronic 

communications by terrorists and others 

who may put the information gained 

through intercepted communications to 

an unlawful use, to promote the 

protection of privacy of oral, wire, or 

electronic communications; and to 

protect against threats of terrorism 

around the world. 

DATES: This rule is effective November 

20, 2006. 

ADDRESSES: Although there is no formal 

comment period, public comments on 

this regulation are welcome and should 

be sent to publiccomments@bis.doc.gov, 

by fax (202) 482–3355 or by mail or 

hand delivery to Sheila Quarterman, 

Office of Exporter Services, Regulatory 

Policy Division, Bureau of Industry and 

Security, Department of Commerce, 

14th Street & Pennsylvania Avenue, 

NW., Room 2705, Washington, DC 

20230. Please refer to regulatory 

identification number (RIN) 0694–AC82 

in all comments, and in the subject line 

of e-mail comments. Comments on the 

collection of information should be sent 

to David Rostker, Office of Management 

and Budget (OMB), by e-mail to 

David_Roster@omb.eop.gov, or by fax to 

(202) 395–7285. 

FOR FURTHER INFORMATION CONTACT: Joan 

Roberts, Director, Foreign Policy 

Division, Office of Nonproliferation and 

Treaty Compliance, Bureau of Industry 

and Security, Department of Commerce, 

P.O. Box 273, Washington, DC 20044; 

Telephone (202) 482–4252, or E-mail: 

jroberts@bis.doc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

This rule amends the Export 

Administration Regulations (EAR) by 

imposing new foreign policy controls 

(‘‘SL’’ for surreptitious listening) on 

devices primarily useful for the 

surreptitious interception of wire, oral, 

or electronic communications, as well 

as related software and technology. The 

Bureau of Industry and Security (BIS) is 

taking this action in order to prevent the 

unlawful interception of oral, wire, or 

electronic communications by terrorists 

and others who may put the information 

gained through intercepted 

communications to an unlawful use; to 

promote the protection of privacy of 

oral, wire, or electronic 

communications; and to protect against 

threats of terrorism around the world. 

This rule amends the EAR by imposing 

a license requirement for SL reasons to 

all destinations on devices primarily 

useful for surreptitious interception of 

wire, oral or electronic communications 

classified under Export Control 

Classification Number (ECCN) 5A980. 

This rule also imposes controls on 

related software and technology by 

creating ECCN 5D980 for software 

primarily useful for the surreptitious 

interception of wire, oral, or electronic 

communications, and software 

primarily useful for the ‘‘development’’, 

‘‘production’’, or ‘‘use’’ of devices 

controlled under ECCN 5A980; and by 

creating ECCN 5E980 for technology 

primarily useful for the ‘‘development’’, 

‘‘production’’, or ‘‘use’’ of devices 

controlled under ECCN 5A980. 

This rule also imposes a license 

requirement for AT reasons on exports 

and reexports of items controlled under 

5A980, 5D980, or 5E980 to Cuba, Iran, 

North Korea, Sudan, and Syria. BIS will 

generally deny all applications 

involving terrorist supporting countries 

and those involving a material 

contribution to certain proliferation 

activities as set forth in part 744 of the 

EAR. 

BIS will generally approve 

applications for the export and reexport 

of items classified under 5A980, 5D980, 

or 5E980 to all other destinations, 

except for destinations for which a 

license is required for AT reasons, by 

providers of wire or electronic 

communication service acting in the 

normal course of business; or officers, 

agents, or employees of, or persons 

under contract with, the United States, 

a State, or a political subdivision thereof 

in the normal course of activities of any 

of the governmental entities listed. 

License applications from other parties 

will generally be denied. 

The license requirement for 5A980, 

5D980, and 5E980 items is not reflected 

on the Commerce Country Chart 

(Supplement No. 1 to Part 738 of the 

EAR). The requirement is set forth at the 

entries for ECCNs 5A980, 5D980, and 

5E980 on the Commerce Control List 

(CCL) in part 774 of the EAR and also 

in section 742.13(a) of the EAR. Section 

742.13(b) of the EAR sets forth the 

licensing policy for surreptitious 

communications intercepting devices 

controlled under 5A980, as well as 

related software and technology 

controlled under newly created ECCNs 

5D980 and 5E980. 

The license requirements set forth in 

the EAR are independent of the 

requirements of section 2512 of the 

Omnibus Crime Control and Safe Streets 

Act of 1968, as amended (18 U.S.C. 

2512). These controls do not supersede, 

nor do they implement, construe, or 

limit the scope of any of the statutory 

restrictions of section 2512 of the 

Omnibus Crime Control and Safe Streets 

Act of 1968, as amended, that are 

enforced by the U.S. Department of 

Justice. 

This rule maintains the restriction on 

License Exception availability for the 

export or reexport of items primarily 

useful for surreptitious interception of 

wire, oral, or electronic 

communications, or related software, 

controlled under ECCNs 5A980, as set 

forth in section 740.2(a), Restrictions on 

all License Exceptions, of the EAR. Only 

License Exception Governments, 

international organizations, and 

international inspections under the 

Chemical Weapons Convention (GOV) is 

available to export or reexport such 

items if consigned to and for the official 

use of an agency of the U.S. 

Government, as set forth in section 

740.11(b)(2)(ii) of the EAR. This rule 

places the same restrictions on License 

Exception availability for software 

controlled under new ECCN 5D980. No 

License Exceptions are available for the 

export or reexport of technology useful 

for surreptitious interception of wire, 

oral, or electronic communications 

covered under new ECCN 5E980. 

This action is taken after consultation 

with the Secretary of State. BIS 

submitted a foreign policy report to the 


sroberts on PROD1PC70 with RULES