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[Federal Register Volume 80, Number 190 (Thursday, October 1, 2015)]
[Rules and Regulations]
[Pages 59021-59032]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-24950]

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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 80, No. 190 / Thursday, October 1, 2015 / 
Rules and Regulations

[[Page 59021]]

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 21 and 45

[Docket No.: FAA-2013-0933; Amdt. Nos. 21-98, 45-29]
RIN 2120-AK20

Changes to Production Certificates and Approvals

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: The FAA is amending certification procedures and marking 
requirements for aeronautical products and articles. The amendment 
requires production approval holders to identify an accountable manager 
who is responsible for, and has authority over, their production 
operations and serves as the primary contact with the FAA; allows 
production approval holders to issue authorized release documents for 
aircraft engines, propellers, and articles; permits production 
certificate holders to manufacture and install interface components; 
requires production approval holders to ensure that each supplier-
provided product, article, or service conforms to the production 
approval holder's requirements and establish a supplier-reporting 
process for products, articles, or services that have been released 
from or provided by the supplier and subsequently found not to conform 
to the production approval holder's requirements; removes the 
requirement that fixed-pitch wooden propellers be marked using an 
approved fireproof method; and changes the title of part 21 of title 14 
of the Code of Federal Regulations. This amendment updates FAA 
regulations to reflect the current global aeronautical manufacturing 
environment, thereby promoting aviation safety.

DATES: Effective March 29, 2016.

ADDRESSES: For information on where to obtain copies of rulemaking 
documents and other information related to this final rule, see How To 
Obtain Additional Information in the SUPPLEMENTARY INFORMATION section 
of this document.

FOR FURTHER INFORMATION CONTACT: For technical questions concerning 
this action, contact Priscilla Steward or Robert Cook, Aircraft 
Certification Service, Production Certification Section, AIR-112, 
Federal Aviation Administration, 800 Independence Avenue SW., 
Washington, DC 20591; telephone (202) 267-1656; email: 
priscilla.steward@faa.gov or telephone: (202) 267-1590; email: 
robert.cook@faa.gov.
    For legal questions concerning this action, contact Benjamin 
Jacobs, Office of the Chief Counsel, Regulations Division, Federal 
Aviation Administration, 800 Independence Avenue SW., Washington, DC 
20591; telephone: (202) 267-7240; email: benjamin.jacobs@faa.gov.

SUPPLEMENTARY INFORMATION: 

Authority for This Rulemaking

    The Department of Transportation (DOT) is responsible for 
developing transportation policies and programs that contribute to 
providing fast, safe, efficient, and convenient transportation under 
Sec.  101 of Title 49, United States Code (49 U.S.C.). The Federal 
Aviation Administration (FAA, we, us, or our) is an agency of DOT. The 
FAA has general authority to issue rules regarding aviation safety, 
including minimum standards for articles and for the design, material, 
construction, quality of work, and performance of aircraft, aircraft 
engines, and propellers under 49 U.S.C. 106(g), 44104, and 44701.
    The FAA is amending its regulations governing certification 
procedures for products and articles, and its requirements for 
identification and registration marking. These changes improve the 
quality standards applicable to manufacturers and help to ensure that 
products and articles are produced as designed and safe to operate. For 
those reasons, these amendments are a reasonable and necessary exercise 
of our rulemaking authority and obligations.

I. Executive Summary

A. Purpose of the Regulatory Action

    This final rule changes certification and marking requirements for 
products and articles. In particular, this final rule:
     Requires applicants for a production approval and 
production approval holders (PAHs) to identify an accountable manager;
     Allows a production certificate (PC) holder to manufacture 
and install interface components (IC) under certain conditions and 
limitations;
     Clarifies that a PAH must ensure that each supplier-
provided product, article, or service conforms to the PAH's 
requirements;
     Requires a PAH to establish a supplier-reporting process 
for products, articles, or services released from or provided by a 
supplier and subsequently found not to conform to the PAH's 
requirements;
     Allows a PAH that establishes an FAA-approved process in 
its quality system to issue authorized release documents (using FAA 
Form 8130-3) for new and used aircraft engines, propellers, and 
articles produced by that PAH; and
     Excludes fixed-pitch wooden propellers from the 
requirement that a propeller, propeller blade, or propeller hub be 
marked using an approved fireproof method.
    Regulations pertaining to certification requirements for products 
and articles are in part 21 of Title 14 of Code of Federal Regulations 
(14 CFR). Marking requirements are in 14 CFR part 45.
    This final rule requires applicants for a production approval and 
production approval holders (PAHs) to identify an accountable manager 
who is responsible for, and has authority over, a PAH's operations. 
This individual would also serve as a PAH's primary contact with the 
FAA. Additionally, this amendment requires PAHs to amend, where 
applicable, the documents required by Sec. Sec.  21.135, 21.305, and 
21.605 to reflect the appointment of an accountable manager.
    This final rule allows a production certificate \1\ (PC) holder to 
manufacture

[[Page 59022]]

and install interface components (IC) under certain conditions and 
limitations. This final rule defines an IC as an article that serves as 
a functional interface between an aircraft and an aircraft engine, 
between an aircraft engine and a propeller, or between an aircraft and 
a propeller. Under this rule, an IC is designated as such by the type 
certificate (TC) or the supplemental type certificate (STC) holder who 
controls the approved design data for that article.
---------------------------------------------------------------------------

    \1\ Section 21.1(b)(6) defines production approval as a document 
issued by the FAA to a person that allows the production of a 
product or article in accordance with its approved design and 
approved quality system, and can take the form of a production 
certificate, a PMA, or a TSO authorization.
---------------------------------------------------------------------------

    This final rule clarifies that a PAH must ensure that each 
supplier-provided product, article, or service conforms to the PAH's 
requirements. This final rule also requires a PAH to establish a 
supplier-reporting process for products, articles, or services released 
from or provided by a supplier and subsequently found not to conform to 
the PAH's requirements. A PAH's reporting system may require suppliers 
to report nonconformances to the PAH directly, or to other suppliers in 
the supply chain.
    This final rule allows a PAH that establishes an FAA-approved 
process in its quality system to issue authorized release documents 
(using FAA Form 8130-3) for new and used aircraft engines, propellers, 
and articles produced by that PAH. This provision allows PAHs 
privileges similar to those afforded European- and Canadian-approved 
manufacturers.
    This final rule amends part 45 to exclude fixed-pitch wooden 
propellers from the requirement that a propeller, propeller blade, or 
propeller hub be marked using an approved fireproof method. This 
exclusion allows manufacturers to mark their products in a practical 
manner that takes account of the inherent nature of wooden propellers.
    This final rule amends the title of part 21 to include articles. 
The title is now ``Certification Procedures for Products and 
Articles.''

B. Summary of Costs and Benefits

    The provisions of this final rule (1) are minimal cost, (2) impose 
no additional costs because the provisions clarify only, or are current 
practice, or (3) are voluntary and therefore inherently cost-
beneficial. Our analysis described in the notice of proposed rulemaking 
(NPRM) regulatory evaluation has not changed. The FAA received no 
comments to the docket on the NPRM regulatory evaluation.

II. Background

    Part 21 of 14 CFR contains the FAA's regulations concerning 
certification procedures for products, articles, and parts. Since the 
FAA codified part 21 in 1964, it has been amended numerous times. 
Additionally, the origins of many part 21 regulations can be traced to 
the Civil Air Regulations codified in 1937.
    When part 21 was first codified, most manufacturers of aviation 
products and articles had a small, local supplier base. Production 
certificate holders oversaw the manufacture of replacement parts, and 
the international market for aviation products was relatively small. As 
a result, for many years the U.S. had few bilateral agreements with 
other countries for the export and import of aviation products, and 
these agreements were limited in scope.
    Today, aviation products are manufactured world-wide. The number of 
suppliers has increased dramatically, and these suppliers manufacture 
an increasing percentage of a given product or article. Furthermore, 
due to the global nature of manufacturing, forming business 
partnerships and agreements across large geographic areas is now a 
common strategy to lower costs, share risks, and expand markets. 
Manufacturers collaborate globally to reduce duplicate requirements for 
shared suppliers. Accordingly, the international market for aviation 
products and the production of replacement parts under parts 
manufacturer approvals (PMAs) have increased dramatically.
    In recognition of these and other related considerations, the FAA 
published an NPRM, Changes to Production Certificates and Approvals, on 
February 27, 2014, 79 FR 11012. The NPRM proposed numerous rule changes 
to part 21, primarily to subparts A (General) and G (Production 
Certificates). For greater detail on the FAA's initial proposal, 
including additional background information and a more complete 
statement of the problem, refer to the NPRM.

III. Discussion of Public Comments and Final Rule

    In response to the FAA's NPRM, we received comments from 19 
commenters, raising 32 issues. Commenters included aviation 
manufacturers and equipment manufacturers, such as Boeing, Garmin, 
General Electric, HEICO, Textron, Timken, and Williams International; 
industry groups and associations, such as Aerospace Industry 
Association (AIA), Aviation Suppliers Association (ASA), and 
Modification and Replacement Parts Association (MARPA); and numerous 
individuals. The comments covered five main topics and a range of 
various responses to the rulemaking proposal, which are discussed in 
more detail below.

A. Supplier Control

    This final rule makes two amendments to Sec.  21.137(c)(1) & (2). 
First, as proposed, Sec.  21.137(c)(1), which previously required a PAH 
to develop procedures to ensure that a supplier-provided product or 
article conforms to its approved design, now also requires those 
procedures to account for supplier-provided services. Second, as 
proposed, the standard for supplier control is revised in both Sec.  
21.137(c)(1) & (2) to require suppliers to furnish products, articles, 
or services that conform to the PAH's requirements. Prior to this final 
rule, supplier-provided goods and services had to conform to FAA-
approved design data.
    HEICO recommended amending the proposed Sec.  21.137(c)(1) to 
include services provided to a design approval holder. The commenter 
noted that many design approval holders outsource portions of the 
overall design process and these `services' must also be properly 
controlled. The commenter's recommendation is outside the scope of this 
rulemaking, which focuses on production approvals and PAH activities, 
and not on design approval certification activities. PAHs are not 
responsible, under Sec.  21.137, for design approval holder activities.
    ASA and MARPA recommended that, in addition to requiring a PAH to 
require suppliers to provide products, articles, or services to meet 
the PAH requirements, the FAA should also continue to allow a PAH to 
accept products, articles, or services that conform to the PAH's 
approved design. The commenters' rationale was that this final rule 
creates two separate rules with respect to conformity of products and 
articles; one standard for when a company is acting as a supplier, and 
another standard when it is acting as a distributor. The commenters 
claimed that an entity functioning as a supplier to a PAH would be 
required to ensure that the product or article conformed to the PAH's 
requirements. However, if that same entity, operating as a distributor, 
were to sell their products in the aftermarket as replacement parts, 
for instance to a repair station or an air carrier, they would still be 
required to ensure that the product or article conforms to its approved 
design. Both commenters suggested that this situation could result in 
confusion and unintended harm to suppliers, and recommended revising 
proposed Sec.  21.137(c)(1) to allow products, articles, or services to 
conform to either the PAH's requirements or the approved design.

[[Page 59023]]

    The FAA disagrees with the recommendation. With respect to the 
commenters' claim that this final rule creates two separate rules for 
suppliers and distributors in the aftermarket, we presume that the 
commenters used the term ``aftermarket distributor'' to mean that the 
distributor is acting as a supplier to an entity other than a PAH. 
Regardless, this provision does not create two separate standards. All 
suppliers to any purchaser continue to be bound by contract to the 
terms of any relevant purchase order. In the case of suppliers to a 
PAH, the final rule removes the requirement to report deliveries that 
conform to the purchase order but do not conform to the PAH's final 
approved design. Aftermarket distributors who are not suppliers, on the 
other hand, are outside of the scope of part 21. The FAA does not 
regulate aftermarket distributers under these regulations.
    The commenters also suggested that, under this final rule, a 
supplier providing the same part with different specifications to both 
a PAH and an aftermarket customer, such as a maintenance provider, 
could be at risk of inadvertently sending design-conforming parts 
(intended for the aftermarket customer) to a PAH, instead of parts that 
met the PAH's unique specifications. The commenters suggested that the 
supplier in that situation should not be punished for providing an 
article that conforms to its approved design.
    The FAA disagrees with the comment that this change will punish any 
supplier who provides nonconforming products, articles, or services. 
This provision is not intended as a means to punish suppliers. The FAA 
does not directly regulate suppliers; instead, this final rule requires 
that a PAH's quality system include a supplier-reporting system. Under 
this final rule, a PAH must establish procedures for supplier reporting 
of supplier-provided products, articles, or services that deviate from 
the requirements of the PAH's purchase order. This gives a PAH 
flexibility to determine the appropriate level of reporting because it 
is the PAH and only the PAH who knows what is needed, and in what 
condition, for the production process. To clarify, this final rule does 
not require a PAH to report to the FAA those supplier nonconformances 
that remain within the PAH's quality system.
    Relatedly, ASA and MARPA stated that the proposed rule could 
indirectly require a supplier to report nonconformance higher up the 
supply chain, even when the supplier provided a product or article that 
conformed to its approved design. The commenters again recommended that 
the final rule allow suppliers to provide products or articles that 
conform to either the PAH's requirements or the approved design.
    The FAA disagrees with the recommendation. This final rule replaces 
the existing requirement that a supplier-provided product, article, or 
service conform to the PAH's approved design with a requirement that it 
conform to the PAH's requirements. The purpose of this amendment is to 
tailor the regulation to its original intent. For example, a PAH may 
issue a purchase order for sheet metal parts, and state on the purchase 
order that the rivet holes are to be drilled to less than the finished 
dimensions of the approved design. The PAH may request pilot drilling 
by the supplier because the PAH will itself drill the holes to the 
finished size upon assembly. If the supplier provides the items with 
the holes drilled to the finished dimension, the sheet metal parts 
would not conform to the PAH's requirements. The supplier would be 
supplying nonconforming material even though it would conform to the 
approved design. Under this final rule, therefore, a supplier may not 
deviate from the requirements of the PAH. It is the PAH, and only the 
PAH, that knows what is needed, and in what condition, for the 
production process.
    An individual commenter stated that the NPRM changes the definition 
of ``quality escape,'' as the phrase is used in Sec.  21.137(n), from 
nonconforming products or articles which escaped a PAH's quality system 
to products or articles which do not conform to their approved design 
but are contained within the quality system. The commenter recommended 
that we distinguish between nonconforming products or articles still 
within the PAH's quality system, and nonconforming products or articles 
that escape a PAH's quality control system.
    Section 21.137(n), which is not revised by this rule, addresses 
quality escapes by requiring a PAH to have procedures for, among other 
things, identifying and taking corrective action whenever a PAH 
releases a nonconforming product or article from its quality system. In 
our NPRM, we stated that this proposal would require a PAH to establish 
a supplier reporting process for products, articles, or services that 
have been released from a supplier and subsequently found not to 
conform (hereafter referred to as a quality escape) to the PAH's 
requirements. We believe the commenter's confusion derives from our use 
of the term ``quality escape'' to describe the transfer of 
nonconforming items or services between tiers in the supply chain, 
instead of its traditional meaning of nonconforming products or 
articles that leave a PAH's quality system. We acknowledge that our 
preamble discussion in the NPRM used the term in a confusing manner. 
However, we determine that no change to the terms of Sec.  21.137, as 
originally proposed, are necessary. The reporting requirements of Sec.  
21.137(c) apply when a supplier to a PAH determines that it has 
released or provided a product, article, or service subsequently found 
not to conform to the PAH's requirements, and do not include the phrase 
``quality escape.''
    Boeing recommended that the FAA require PAHs to communicate design 
change notifications throughout the supply chain, and adopt the 
industry's SAE \2\ AS9016 standard for standardization of design change 
notifications, because it believes this will address the single most 
common reason for quality escapes from the supply chain.
---------------------------------------------------------------------------

    \2\ Formerly known as the Society of Automotive Engineers.
---------------------------------------------------------------------------

    The FAA disagrees with the recommendation to regulate PAHs' use of 
SAE AS9016 because we believe this subject is adequately addressed by 
our current regulation, Sec.  21.137(a), design data control, which 
requires that only current, correct, and approved data is used. In 
addition, we do not believe that we should mandate, by rule, the use of 
an industry standard over which we have no control. This final rule 
requires a PAH to ensure that any product, article, or service it 
receives conforms to its requirements. If a PAH chooses, it may, as 
part of a purchase order, require its supply-chain to adhere to the 
AS9016 standard.
    Williams International stated that it is unnecessary to require a 
PAH to report supplier nonconformances that remain contained within the 
PAH quality system. Williams International further stated that the 
proposed requirement for reporting of released nonconformances is 
already required by a PAH. FAA Advisory Circular (AC) 00-58, Voluntary 
Disclosure Reporting Program, further provides a means for a voluntary 
disclosure of such releases.
    Although the commenter did not provide a recommendation, the FAA 
disagrees with the commenter's premise. Before this final rule, a PAH's 
supplier-reporting process required each supplier, at any tier, to 
report to the PAH any product, article, or service that did not conform 
to the PAH's FAA-approved design. The FAA recognizes that this 
requirement had the potential to impose significant burdens on a PAH

[[Page 59024]]

and that, in many cases (such as suppliers of standard parts), a 
supplier may not have known the ultimate customer. This final rule 
amends Sec.  21.137(c) to provide every PAH greater flexibility to 
determine which nonconformances its suppliers should report, and to 
whom.
    An individual commenter suggested that all tiers in the supply 
chain should report to a PAH any nonconforming products, articles, or 
services that have been released from or provided by that supplier and 
subsequently found not to conform to the PAH's requirements. More 
specifically, the commenter suggested that the FAA require each 
supplier, in some instances, to report a nonconformance to each level 
up the supply chain, and ultimately to the PAH and the PAH's customer. 
Another individual recommended the FAA keep the current regulation 
which requires suppliers to report quality escapes to the PAH, and 
provided no further rationale.
    The FAA disagrees with the commenters' recommendations. In the 
past, a PAH's supplier-reporting system required every manufacturing 
supplier and affected downstream suppliers to report to the PAH all 
products or articles which did not meet the PAH's approved design, even 
if those products or articles met the PAH's actual requirements. The 
FAA recognizes that this past requirement could have imposed a 
significant burden on PAHs, and this final rule is intended to maintain 
safety while also providing PAHs with the flexibility to determine 
which suppliers should report, and to whom.

B. Accountable Manager

    As the FAA proposed in the NPRM, this final rules amends Sec. Sec.  
21.135, 21.305, and 21.605 to require a PAH to provide the FAA with a 
document identifying the organization's accountable manager. The 
accountable manager is responsible for, and has authority over, all 
part 21 production activities. It is not the FAA's intent that this 
provision dictates who is responsible for PAH production operations. It 
is also not the FAA's intent that this provision imposes personal 
liability for production operations on the accountable manager. The FAA 
is simply requiring each PAH to identify for the FAA the individual or 
individuals within the PAH's organization who the PAH considers 
responsible for all production operations.
    Boeing, MARPA, and Timken Aerospace recommended that an accountable 
manager have the ability to identify and delegate functions to 
alternate points of contact. These commenters noted that the person 
responsible for accountability may be a company president or chief 
executive who cannot reasonably be available at all times. Allowing 
delegation increases the FAA's access to the PAH and provides 
redundancy in the event of personnel turnover, in accordance with the 
intent of this final rule.
    The FAA agrees with the commenters with respect to delegation, but 
determines that no change to the proposed rule language is necessary. 
To clarify, the accountable manager may delegate functions and identify 
alternate points of contact. These actions should be noted in the PAH's 
organization document. Additional guidance may be found in FAA AC 21-
43, Issuance of Production Approvals Under Subparts G, K, & O.
    Boeing and an individual commenter requested that we revise the 
rule to require two accountable managers--one for production activities 
and one for design activities. These commenters claimed that two such 
accountable managers would better reflect the various responsibilities 
of PAH personnel, including those responsible for coordinating with FAA 
manufacturing inspection district offices (MIDOs) and aircraft 
certification offices (ACOs).
    The FAA disagrees with the commenters' recommendation. The 
commenters are describing design-related activities and 
responsibilities. Because the public was not provided an opportunity to 
comment on an FAA requirement for an accountable manager for design 
activities, the FAA considers the recommendation to be outside the 
scope of this rulemaking. To clarify, the accountable manager described 
in this rule is required only to have responsibility for production 
operations, not design activities.
    Garmin International and Williams International stated that there 
is no need for an accountable manager, and recommended instead a 
requirement that the PAH identify an FAA point of contact. In addition, 
Garmin stated that a better means to improve the FAA's access would be 
to require a PAH to clearly indicate how its organization will 
communicate. Williams recommended that if the FAA has difficulty 
communicating with a particular PAH, that PAH should be required to 
clarify its own existing procedures.
    The FAA disagrees with the commenters' recommendations. An 
accountable manager is not simply a point of contact. When issuing an 
approval or performing certificate management, the FAA must know who 
from the PAH has the authority to speak for the PAH and ensure 
compliance with all applicable regulatory requirements. Requiring a PAH 
to identify such an individual, one who is knowledgeable of and 
accountable for maintaining the PAH's FAA production approval, will 
improve communication between the PAH and the FAA offices responsible 
for certificate management of their production approval. A simple point 
of contact would not create the same benefits.
    Universal Avionics Systems Corporation (UASC), Textron, and an 
individual commenter suggested identifying the accountable manager as 
the ``Quality Manager.'' Textron stated that the rule could be 
misinterpreted as describing the PAH official in charge of production 
operations, instead of the person who runs the quality system. UASC and 
the individual commenter both observed that the FAA already requires 
accountable managers for repair stations. The individual commenter 
further stated that organizational differences between a typical PAH 
and a typical repair station make identifying a general manager as an 
accountable manager less appropriate for a PAH than for a repair 
station. Finally, UASC recommended incorporating the definition of 
``directly in charge'' from part 145 (Repair Stations) into part 21, to 
better explain the role of ``accountable manager.'' UASC stated that it 
believes the Accountable Manager is intended to be a quality person 
whom may not have responsibility for and authority over production 
operations.
    The FAA disagrees with the commenters' recommendations. Although 
the FAA requires the establishment of a quality system as a 
prerequisite to obtaining a production approval, nowhere do we require 
a PAH to create an organizational position responsible solely for the 
PAH's quality system. Moreover, under this rule, the accountable 
manager must be at a sufficient level within the organization to have 
responsibility over all production operations, not just the quality 
system. For example, the accountable manager should have responsibility 
for, among other things, formally applying to add a new product or 
article to the PAH's production approval; formally requesting FAA 
approval for a change in location; amending the PAH's organization 
document and submitting that document to the FAA; ensuring support for 
design approval holders, as required by Sec.  21.137(m); and formally 
submitting

[[Page 59025]]

changes to the PAH's approved quality system.
    We also disagree with the commenters' comparisons of part 21 and 
part 145 accountable managers. A PAH's accountable manager has 
different duties and responsibilities from the accountable manager of a 
repair station. Furthermore, the ``directly in charge'' definition from 
part 145 does not apply to a PAH's accountable manager. We are not 
requiring a PAH accountable manager to be ``directly in charge'' of the 
work performed by the production organization.

C. Authorized Release Documents

    This final rule creates Sec.  21.137(o), which permits a PAH to 
issue authorized release documents for new aircraft engines, 
propellers, and articles manufactured by that PAH, and for used 
aircraft engines, propellers, and articles rebuilt or altered in 
accordance with Sec.  43.3(j), provided the PAH establishes and adheres 
to certain quality assurance procedures as part of its quality system. 
This final rule marks a slight change from what the FAA initially 
proposed: In response to comments, we explicitly restrict each PAH to 
issuing authorized release documents for products and articles 
manufactured by the PAH itself.
    Boeing recommended that the FAA consider requiring PAH personnel 
selected to issue authorized release documents to receive FAA training 
equivalent to what is currently required for designees. The FAA 
disagrees with the recommendation. Under this final rule, a PAH that 
chooses to issue authorized release documents must establish a training 
process for individuals the PAH selects to issue those documents. The 
PAH may choose to send its personnel to FAA designee training (if 
available), establish its own in-house training, or meet the 
requirement in some other manner. The rule establishes minimum 
requirements and permits the PAH to establish FAA-approved procedures 
to meet those requirements.
    ASA stated that the rule does not give a PAH authority to issue FAA 
Form 8130-3 because the term ``authorized release document'' is not 
defined. The commenter also suggested changing the definition of 
airworthiness approval to add Airworthiness approval means a document 
issued by the FAA, or a person authorized by the FAA.
    The FAA disagrees with ASA's recommendations. As stated in Sec.  
21.1(b)(1), an airworthiness approval is a document that must be issued 
by the FAA. By this final rule, however, the FAA will now permit an 
authorized PAH to issue authorized release documents, using an FAA Form 
8130-3, for new aircraft engines, propellers, and articles, and for 
used aircraft engines, propellers, and articles when rebuilt or altered 
in accordance with Sec.  43.3(j). PAHs that intend to issue these 
documents must detail the appropriate procedures in their quality 
manual. To be clear, FAA regulations and policy distinguish between a 
document issued by the FAA (an airworthiness approval) and one issued 
by the PAH (an authorized release document). In addition, the latest 
version of FAA AC 21-43, released concurrently with this final rule, 
clearly states that a PAH should use FAA Form 8130-3 when issuing an 
authorized release document.
    ASA recommended extending the privilege of issuing an authorized 
release document beyond PAHs, to include distributors accredited in 
accordance with FAA AC 00-56, Voluntary Industry Distributor 
Accreditation Program. The commenter suggested that not doing so would 
create a significant competitive disadvantage for certain American 
businesses. More specifically, the commenter argued that failing to 
allow non-manufacturing distributors to issue authorized release 
documents would put those distributors at a competitive disadvantage.
    The FAA disagrees with the recommendation. The FAA cannot extend 
this privilege to non-manufacturer distributors because they are not 
recognized PAHs and, therefore, lack FAA-approved quality systems. 
Quality systems are necessary to ensure that products and articles 
conform to their approved design and are in a condition for safe 
operation. The intent of this provision is to maintain the high level 
of safety achieved under the prior rules, while allowing FAA-approved 
PAHs to engage in a practice that is permitted by other authorities, 
such as the European Union and Canada, for their PAHs.
    One individual commenter suggested that the FAA limit a PAH's 
authority so that the PAH could only issue authorized release documents 
for new or used aircraft engines, propellers, and articles that the PAH 
itself manufactured under part 21.
    The FAA agrees with the commenter's proposal. Where a PAH was not 
involved in manufacturing a product or article, the PAH may not have 
the ability to make the appropriate conformity determination. 
Accordingly, this final rule limits a PAH's authority to issue 
authorized release documents to only those products and articles that 
particular PAH has manufactured.
    Two individual commenters stated that allowing a PAH to issue Form 
8130-3 as an authorized release document will reduce or be detrimental 
to aviation safety. One of these commenters pointed out that, prior to 
this final rule, FAA designees assigned to complete Form 8130-3 would 
occasionally turn back parts and articles due to issues discovered 
during the FAA conformity inspections. For that reason, the commenters 
claimed that eliminating designees' continued, objective inspections 
would reduce safety. Both commenters suggested keeping the current 
system.
    The FAA disagrees with the commenters' characterization of how FAA 
Form 8130-3 has been used previously, as well as their recommendations. 
With respect to products and articles produced under a production 
approval, issuance of an FAA Form 8130-3 indicates that that the 
product or article conforms to its type design and is in a condition 
for safe operation, unless otherwise specified. Even prior to this 
rulemaking, FAA Form 8130-3 did not (and does not now) indicate that a 
particular product or article has been inspected by the FAA or its 
designee.
    Additionally, allowing a PAH, as opposed to an FAA employee or 
designee, to issue FAA Form 8130-3 will not cause a decrease in safety. 
Currently, Designated Manufacturing Inspection Representatives (DMIRs) 
or Organization Designation Authorization (ODA) unit members issue the 
vast majority of FAA Form 8130-3s. These designees are employed by the 
PAH and authorized by the FAA, and the FAA requires them to possess at 
least certain minimum qualifications and training, such as those 
described in FAA Orders 8100.8, 8000.95 and 8100.15. Similarly, under 
this final rule, any PAH seeking authority to issue FAA Form 8130-3 
must first get FAA approval. As described in FAA AC 21-43, the FAA will 
not approve a PAH to issue FAA Form 8130-3 unless the PAH demonstrates 
that its authorized personnel possess the same qualifications and 
receive training equivalent to what is required by FAA Orders 8100.8, 
8000.95 and 8100.15 for FAA designees.
    Timken Aerospace suggested that allowing PAHs to issue authorized 
release documents would add complexity to the existing process and 
increase the FAA's workload. The commenter recommended instead 
developing a system to assist PAHs in obtaining additional DMIRs.
    The FAA disagrees with the recommendation. The FAA anticipates that 
permitting PAHs to issue authorized release documents will

[[Page 59026]]

reduce the workload of both the FAA and PAHs. Our intent is to 
recognize a practice permitted by other authorities by giving FAA-
approved PAHs the same flexibility available to their European and 
Canadian counterparts, who already issue authorized release documents. 
For PAHs with an approved system for issuing authorized release 
documents, the FAA will no longer authorize DMIRs or ODA unit members 
to issue airworthiness approvals.
    Textron Aviation recommended that the FAA remove the regulatory 
language in our 2014 NPRM proposing to allow the use of authorized 
release documents for work performed under Sec.  43.3(j). The commenter 
stated that this type of rebuilding work, and related use of FAA Form 
8130-3, is already performed by PAH manufacturers.
    The FAA disagrees with the recommendation. The commenter is correct 
that FAA Order 8130.21 allows certain entities to use FAA Form 8130-3 
when returning to service rebuilt or altered engines, propellers, or 
articles in accordance with Sec.  43.3(j). However, the FAA's final 
rule codifies our authorization of that practice and extends the same 
privilege to PAHs producing new aircraft engines, propellers, and 
articles.
    Textron Aviation also claimed that FAA Order 8130.21 requires 
authorized persons to document inspection activity on an FAA Form 8100-
1 when required by the managing office, and recommended revising either 
Sec.  21.137 or FAA Order 8130.21 to indicate that a PAH is not 
required to use FAA Form 8100-1 when issuing authorized release 
documents.
    The FAA disagrees with both the commenter's claim and 
recommendation. Neither our prior rules, nor this final rule, requires 
a PAH to comply with the internal guidance in FAA Order 8130.21. More 
specifically, Sec.  21.137(o) does not require any PAH to use FAA Form 
8100-1 when issuing an FAA Form 8130-3. Furthermore, FAA Order 8130.21 
does not require the use of FAA Form 8100-1, but an FAA managing office 
may determine that a conformity inspection report is necessary to 
substantiate an FAA-issued FAA Form 8130-3.
    One individual commenter stated that allowing a PAH to develop its 
own procedures for signing authorized release documents will reduce or 
eliminate the standardization that exists among designees. The 
commenter recommended that requiring PAH personnel to take FAA training 
would facilitate greater standardization.
    The FAA disagrees with the recommendation. When a PAH signs an 
authorized release document, the PAH is not signing that document on 
behalf of the FAA Administrator. The FAA requires any PAH that chooses 
to issue authorized release documents to establish minimum procedures, 
including training the employees responsible for issuing those 
documents. These procedures will be reviewed and, if acceptable, 
approved by the FAA, which will be conducive to standardization. 
Ultimately, however, the current proposal gives each PAH the 
flexibility to choose to send its personnel to FAA designee training 
(if available), establish their own in-house training, or meet the 
requirement in some other manner.

D. Definitions

    This final rule revises one definition and adds two new definitions 
to Sec.  21.1. The definition of ``airworthiness approval,'' in Sec.  
21.1(b)(1), is expanded to account for the issuance of an airworthiness 
approval in instances where an aircraft, aircraft engine, propeller, or 
article does not conform to its approved design or may not be in a 
condition for safe operation at the time the airworthiness approval is 
generated and that nonconformity or condition is specified on the 
airworthiness approval document. In response to comments, we revised 
the definition proposed in our NPRM to account for the fact that an 
airworthiness approval may in some cases be issued for products or 
articles that are not in a condition for safe operation, such as when 
those products or articles are packed for shipment.
    As proposed, Sec.  21.1(b)(5) defines an ``interface component'' as 
a functional interface between an aircraft and an aircraft engine, an 
aircraft engine and a propeller, or an aircraft and a propeller. 
Furthermore, an interface component is designated by the holder of the 
type certificate or the supplemental type certificate who controls the 
approved design data for that article. This definition is necessary 
because this final rule also promulgates Sec.  21.147(c), which permits 
a PAH to apply to the FAA to amend its production certificate to allow 
the PAH to manufacture and install interface components. No change was 
made to the definition in this final rule from the NPRM.
    Finally, as proposed, Sec.  21.1(b)(10) defines a ``supplier'' as 
any person at any tier in the supply chain who provides a product, 
article, or service that is used or consumed in the design or 
manufacture of, or installed on, a product or article. This definition 
is necessary to clarify existing FAA requirements. No change was made 
to the definition in this final rule from the NPRM.
    Timken Aerospace and one individual commenter recommended we revise 
our proposed airworthiness approval definition by moving ``unless 
otherwise specified'' to be the final clause. In other words, these 
commenters recommended changing the definition to a document which 
certifies that the aircraft, aircraft engine, propeller, or article 
conforms to its approved design and is in a condition for safe 
operation, unless otherwise specified. The commenters noted, for 
example, that an engine is not shipped from a factory in a complete and 
final condition, since it is prepped for shipping, and is therefore not 
in a condition for safe operation.
    The FAA agrees with the commenters' recommendation. There are many 
instances in which the FAA issues an airworthiness approval but, at the 
time of issuance, the product or article neither fully conforms to its 
approved design, nor is it in a condition for safe operation. For 
example, the FAA may issue an airworthiness approval for an aircraft 
that has been disassembled for shipping, for an engine that has 
preservation fluids installed prior to shipping, or for used aircraft 
engines and propellers that are not in a condition for safe operation 
(see Sec.  21.331, Issuance of export airworthiness approvals for 
aircraft engines, propellers, and articles). We therefore revise the 
definition of airworthiness approval to a document, issued by the FAA 
for an aircraft, aircraft engine, propeller, or article, which 
certifies that the aircraft, aircraft engine, propeller, or article 
conforms to its approved design and is in a condition for safe 
operation, unless otherwise specified.
    Also with respect to the airworthiness approval definition, Timken 
Aerospace recommended we use the phrase ``except for deviations noted'' 
instead of ``unless otherwise specified,'' to be more consistent with 
FAA Form 8130-9, Statement of Conformity.
    The FAA disagrees with the recommendation. The concept of 
airworthiness is generally composed of two factors: Conformity with an 
approved design and being in a condition for safe operation. In this 
context, the term ``deviation'' would indicate a variation from an 
approved design or quality system, but would not necessarily convey the 
fact that a product is not in a condition for safe operation. 
Accordingly, we determine that the phrase ``unless otherwise 
specified'' more accurately reflects the intent of our proposal.

[[Page 59027]]

    Two individual commenters expressed concern that adding ``unless 
otherwise specified'' to the definition of airworthiness approval would 
change a fundamental premise of airworthiness approvals, that a product 
or article must conform to its design. The commenters recommended that 
the definition not be changed.
    The FAA disagrees with the commenters. The issuance of an 
airworthiness approval, such as an export certificate of airworthiness, 
does not necessarily mean that a product is airworthy. FAA regulations, 
such as Sec.  21.331, allow FAA personnel and designees to issue an 
airworthiness approval for a product or article that does not conform 
to its approved design, as long as the nonconforming condition is 
stated on the approval document and, in the case of export, the 
receiving authority agrees to accept the product or article as 
described. This final rule, therefore, simply brings the definition of 
Airworthiness Approval in line with current FAA practice and with part 
21, subpart L. Contrary to the commenters' suggestion, we are not 
changing the fundamental concept of airworthiness. Under current 
practices, an airworthiness approval is a means to show that the 
product or article conforms to its approved design and is in a 
condition for safe operation, unless otherwise specified.
    One individual commenter stated that the definition of ``supplier'' 
is overbroad because it includes distributors of commercial off the 
shelf parts or parts not originally manufactured for aviation use. The 
same commenter also stated that the addition of the term ``at any 
tier'' will cause inconsistent and disparate interpretation within the 
FAA and undue burden to industry. The commenter did not provide any 
recommendations.
    The FAA recognizes that by including the term ``at any tier,'' the 
proposed definition of ``supplier'' applies to all suppliers throughout 
the supply chain. Contrary to the commenter's statement, the FAA 
believes including suppliers ``at any tier'' will reduce 
inconsistencies by confirming that the FAA definition of ``supplier'' 
applies to all suppliers, regardless of their position within the 
supply chain. Furthermore, the FAA does not believe this definition 
will unduly burden industry. To the extent that a supplier has only a 
tenuous connection to a PAH, perhaps because the supplier produces 
parts that are not specifically designed for use in aviation, it may be 
appropriate for the PAH to account for that attenuation when designing 
its supplier-reporting protocols. A PAH has always been responsible for 
assuring that its products and articles conform and are in a condition 
for safe operation. The inclusion of all suppliers within the 
regulatory definition of supplier should therefore impose no additional 
burden on either the PAH or its suppliers.
    The same individual commenter also stated that there is no guidance 
for the suppliers of off-the-shelf parts, described above, who may not 
anticipate that their parts will be used or installed on type 
certificated aircraft and approved.
    The FAA agrees with the commenter's observation that there is no 
guidance provided specifically for distributors of parts not originally 
manufactured for aviation use or installation on type certificated 
aircraft and approved under Sec.  21.8(c). The FAA provides guidance to 
PAHs, repair stations, and other FAA-regulated entities. The FAA does 
not provide guidance for entities that fall outside the scope of FAA 
regulations.

E. Interface Components

    As proposed, Sec.  21.147(c) now permits a PAH to apply to the FAA 
for an amendment to the PAH's production limitation record (PLR), 
authorizing the PAH to manufacture and install interface components. If 
granted, the FAA will amend the PAH's PLR to add the interface 
components (IC). ICs are defined in the new Sec.  21.1(b)(5). The FAA 
had previously granted exemptions to engine manufacturers, allowing 
them to manufacture and install airframe components that interface 
between the engine and the airframe, provided the engine manufacturer 
owned or licensed the ICs design and installation data.
    Boeing and General Electric supported the rule change. Boeing also 
suggested the FAA allow engine manufacturers to install and certify 
airplane manufacturers' ICs during the engine type certification 
process.
    The FAA disagrees with this recommendation as it is outside the 
scope of this rulemaking. Allowing engine manufacturers to install and 
certify airplane manufacturers' ICs during the engine TC process is a 
design issue, not a production issue. Our 2014 NPRM and this final rule 
focus on amendments to the production approval provisions in subpart G.
    Williams International recommended that our final rule distinguish 
between all potential ICs versus those that are licensed to be both 
manufactured and installed by a PAH. The commenter suggested that 
defining ICs more narrowly would enable the FAA to include fewer items 
on the PAH's PLR, and as a result would require fewer PLR updates and 
impose less of a burden on the FAA.
    The FAA agrees with the concerns raised byWilliams International, 
but we have determined that the rule as drafted adequately addresses 
these concerns. Under Sec. Sec.  21.1(b)(5) and 21.147(c), a component 
must meet certain criteria before it is considered an ``interface 
component'' eligible for the PAH's PLR. For example, Sec.  21.1(b)(5) 
requires, among other things, that an IC be designated as such by the 
TC or STC holder. The rule requires only those ICs the PAH intends to 
produce be listed on the PLR and not all possible ICs, so the PLR 
should not be an exhaustive list or a burden on the FAA.

F. Miscellaneous Issues

    HEICO requested that the FAA define authorized release documents, 
to establish who is issuing the document. The FAA disagrees with the 
recommendation. The FAA does not believe it is necessary to provide a 
definition in the text of the rule. The FAA provides additional 
guidance on authorized release documents in the revised AC 21.43, 
Appendix B, which is applicable to any PAH.
    One individual commenter stated that the title of the NPRM did not 
reflect recent changes from parts to articles in our 2009 final rule, 
Production and Airworthiness Approvals, Part Marking, and Miscellaneous 
Amendments, 74 FR 53384 (Oct. 16, 2009). The commenter recommended 
changing the title of part 21 to ``Certification Procedures for 
Products, Articles, and Parts.'' The FAA partially agrees with the 
recommendation and this final rule changes the title of part 21 to 
``Certification Procedures for Products and Articles.''
    HEICO requested that we revise FAA Form 8130-3 attached as Appendix 
A, Figure A-1 to FAA Order 8130.21 to explicitly indicate who, 
including a PAH, is allowed to issue the document. The FAA disagrees 
with HEICO's recommendation to revise the form. Instead, we have 
revised FAA Order 8130.21 and ACs 21-43 and 21-44 to reflect the rule 
change allowing a properly authorized PAH to issue an authorized 
release document. In the ACs we also provide guidance to on how to 
complete FAA Form 8130-3.
    Textron Aviation recommended that the FAA remove the requirement 
for the issuance of export airworthiness approvals for articles, 
believing that this change would better align FAA regulations with 
those of foreign authorities. The recommendation is outside the scope 
of this rulemaking. The FAA notes that the requirements for

[[Page 59028]]

the issuance of export airworthiness approvals for articles are 
contained in subpart L. Although the FAA proposed allowing PAHs to 
issue authorized release documents in Sec.  21.137, the proposal did 
not change the conditions specified in subpart L.

IV. Regulatory Notices and Analyses

A. Regulatory Evaluation

    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Orders 12866 and 13563 direct that each 
Federal agency shall propose or adopt a regulation only upon a reasoned 
determination that the benefits of the intended regulation justify its 
costs. Second, the Regulatory Flexibility Act of 1980 (Pub. L. 96-354), 
as codified in 5 U.S.C. 603 et seq., requires agencies to analyze the 
economic impact of regulatory changes on small entities. Third, the 
Trade Agreements Act (Pub. L. 96-39), as amended by the Uruguay Round 
Agreements Act (Pub. L. 103-465), prohibits agencies from setting 
standards that create unnecessary obstacles to the foreign commerce of 
the United States. In developing U.S. standards, the Trade Act requires 
agencies to consider international standards and, where appropriate, 
that they be the basis of U.S. standards. Fourth, the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4), as codified in 2 U.S.C. 1532, 
requires agencies to prepare a written assessment of the costs, 
benefits, and other effects of proposed or final rules that include a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more annually (adjusted for inflation with base year of 
1995). This portion of the preamble summarizes the FAA's analysis of 
the economic impacts of this final rule.
    Department of Transportation Order DOT 2100.5 prescribes policies 
and procedures for simplification, analysis, and review of regulations. 
If the expected cost impact is so minimal that a proposed or final rule 
does not warrant a full evaluation, this order permits that a statement 
to that effect and the basis for it be included in the preamble if a 
full regulatory evaluation of the costs and benefits is not prepared. 
Such a determination has been made for this final rule. The reasoning 
for this determination follows.
    As summarized in the table below, the provisions of this final rule 
(1) are minimal cost, (2) will impose no additional costs because the 
provisions will clarify only, or are current practice, or (3) are 
voluntary and therefore inherently cost-beneficial. Our determination 
has not changed from that made in the NPRM regulatory evaluation. The 
FAA received no comments to the docket on the NPRM regulatory 
evaluation. More detailed explanations follow the table.

------------------------------------------------------------------------
              Provision                          Costs/Benefits
------------------------------------------------------------------------
Require Identification of Accountable  Minimal cost--Requires
 Manager                                identification of an existing
                                        manager, who is responsible for
                                        and has authority over a
                                        Production Approval Holder
                                        (PAH)'s operations, as a PAH's
                                        primary contact with the FAA.
Allow PC Holders to Manufacture and    Codifying the practice,
 Install Interface Components.          previously allowed by exemption,
                                        will reduce regulatory
                                        compliance costs.
Modify Supplier Control Requirements.  No additional cost--Clarifies
                                        existing requirement that PAHs
                                        are responsible for conformity
                                        throughout their supply chains
                                        and gives PAHs flexibility in
                                        establishing a supplier-
                                        reporting process for
                                        nonconforming releases.
Allow PAHs to Issue Authorized         Voluntary, so expected benefits
 Release Documents for Aircraft         will exceed expected costs.
 Engines, Propellers and Articles.
Exclude Fixed-Pitch Wooden Propellers  The FAA found the exemption
 from Fireproof Marking Requirements.   provides an equivalent level of
                                        safety. Codifying the practice,
                                        previously allowed by exemption,
                                        will reduce regulatory
                                        compliance costs.
------------------------------------------------------------------------

 1. Require Identification of an Accountable Manager
    Under this provision, the FAA will require each applicant for, or 
holder of, a Production Certificate (PC), Parts Manufacturer Approval 
(PMA), or Technical Standard Order (TSO) authorization to identify an 
accountable manager, who is responsible for, and has authority over, a 
PAH's operations, as a PAH's primary contact with the FAA. This 
provision is not intended to require the PAH to create a new position 
within its organization and will not mandate that an individual in a 
specific position be identified as the accountable manager. 
Consequently, the costs, if any, associated with this requirement are 
minimal.
2. Allow Production Certificate Holders To Manufacture and Install 
Interface Components
    PC holders previously could not install interface components (ICs) 
on their type-certificated products without an exemption. Previous 
regulations governing the production limitation record and the 
amendment of PCs restricted the PC holder to the manufacture of 
products only (aircraft, aircraft engines, or propellers) and did not 
authorize installation.\3\ The FAA has granted exemptions to engine 
manufacturers, allowing them to manufacture and install airframe 
components that interface between the engine and the airframe provided 
they own or are licensed to use the IC type design and installation 
data. In granting these exemptions, the FAA found that allowing engine 
manufacturers to produce and install ICs improved safety and efficiency 
by eliminating disassembly, reassembly and retesting, as well as 
related scoring of fatigue sensitive parts; damage to critical parts; 
and air/fuel/oil leaks.\4\ This provision will codify the practice, 
previously allowed by exemption, of allowing PC holders to manufacture 
and install ICs, and will apply to any articles designated by the TC 
holder that interface between products. Therefore, this provision 
applies to the interface between propeller and aircraft engine and 
between propeller and aircraft, as well as between aircraft engine and 
aircraft.
---------------------------------------------------------------------------

    \3\ Before 2010, Sec. Sec.  21.142 (production limitation 
record) and 21.147 (amendment of production certificates) were 
codified at Sec. Sec.  21.151 and 21.153, respectively.
    \4\ The production and installation of ICs by engine 
manufacturers also increase efficiency by allowing delivery of 
quick-change replacement engines to end users such as air carriers 
and charter operators. Some piece parts (or kits), such as the 
engine buildup unit (EBU), rather than being installed by the PC 
holder, may be shipped separately to an aircraft manufacturer for 
the purpose of just-in-time manufacturing operations, or to an 
airline that may want kits on hand for routine maintenance 
operations or to replace hardware damaged during operations.
---------------------------------------------------------------------------

    Codifying the previous practice of allowing PC holders to 
manufacture and install ICs implies no change in safety

[[Page 59029]]

benefits. Codifying the practice, however, will reduce regulatory costs 
since paperwork requirements involved in periodic application for and 
granting of exemptions will be eliminated.
3. Modification of Supply Control
    With this provision, the FAA intends to clarify existing 
requirements that the PAH is responsible for (1) conformity throughout 
the supply chain and (2) establishing a supplier reporting process for 
nonconforming releases. As there was no definition of supplier in the 
previous regulations, the final rule defines supplier as a person that 
provides a product, article, or service at any tier in the supply chain 
that is used or consumed in the design or manufacture of, or installed 
on, a product or article.
    The final rule changes the language to Sec.  21.137(c) as shown in 
the following table:

------------------------------------------------------------------------
         Previous rule language                Final rule language
------------------------------------------------------------------------
Supply Control--Procedures that (1)      Supply Control--Procedures that
 Ensure that each supplier-furnished      (1) Ensure that each supplier-
 product or article conforms to its       provided product, article, or
 approved design; and                     service conforms to the
                                          product approval holder's
                                          requirements; and
(2) Require each supplier to report to   (2) Establish a supplier
 the production approval holder if a      reporting process for
 product or article has been released     products, articles or services
 from that supplier and subsequently      that have been released from
 found not to conform to the applicable   the supplier and subsequently
 design data.                             found not to conform to the
                                          production approval holder's
                                          requirements.
------------------------------------------------------------------------

    As provision (1) clarifies the FAA's intent and current practice 
and provision (2) gives PAHs greater flexibility, there will be no 
additional cost resulting from these provisions.
4. Allow Production Approval Holders To Issue Authorized Release 
Documents for Aircraft Engines, Propellers, and Articles
    Previously, only the FAA was allowed to document that an aircraft 
engine, propeller, or article conforms to its approved design and is in 
condition for safe operation. The FAA provides documentation with an 
airworthiness approval, using FAA Form 8130-3, ``Authorized Release 
Certificate, Airworthiness Approval Tag.'' This provision allows, but 
does not require, qualified PAHs to issue authorized release documents, 
using FAA Form 8130-3, for aircraft engines, propellers, and articles 
for which the PAH has a production approval. We refer to the issuance 
of Form 8130-3 by a PAH as an ``authorized release document'' because, 
as defined by 14 CFR 21.1(b)(1), only the FAA is allowed to issue an 
airworthiness approval. PAHs choosing not to issue these authorized 
release documents may continue to obtain approvals from the FAA.
    Although such airworthiness documentation is required only when 
requested by a foreign civil aviation authority, it has become 
increasingly valued in the aviation industry. Several U.S. 
manufacturers have requested the privilege to issue such documentation, 
which is already enjoyed by their European and Canadian counterparts. 
As it is voluntary, this provision is inherently cost beneficial.\5\
---------------------------------------------------------------------------

    \5\ For aircraft, an export airworthiness approval will continue 
to be issued only by the FAA, using Form 8130-4, ``Export 
Certificate of Airworthiness.''
---------------------------------------------------------------------------

5. Marking of Fixed-Pitch Wooden Propellers
    As noted in the preamble above, the FAA granted an exemption to 
Sensenich Wood Propeller Company from the regulations requiring that a 
propeller, propeller blade, or propeller hub be marked using an 
approved fireproof method. In granting the exemption, the FAA found 
that stamping the hub of the propeller with the identification markers 
will achieve an equivalent level of safety to the rule. The FAA 
maintains that finding in this final rule and, in any case, codifying 
the practice, previously allowed by exemption, implies no change in 
safety benefits.\6\ Codifying the practice, however, will reduce 
regulatory costs since the costs of paperwork requirements involved in 
periodic application for and granting of the exemptions will be 
eliminated.
---------------------------------------------------------------------------

    \6\ Variable-pitch wooden propellers do not require exception 
from the fireproof marking requirement since they have metal hubs.
---------------------------------------------------------------------------

    The FAA made this minimal cost determination for the proposed rule. 
As no comments were received, the FAA concludes the expected cost is 
minimal.

B. Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA) 
establishes as a principle of regulatory issuance that agencies shall 
endeavor, consistent with the objectives of the rule and of applicable 
statutes, to fit regulatory and informational requirements to the scale 
of the businesses, organizations, and governmental jurisdictions 
subject to regulation. To achieve this principle, agencies are required 
to solicit and consider flexible regulatory proposals and to explain 
the rationale for their actions to assure that such proposals are given 
serious consideration. The RFA covers a wide-range of small entities, 
including small businesses, not-for-profit organizations, and small 
governmental jurisdictions.
    Agencies must perform a review to determine whether a rule will 
have a significant economic impact on a substantial number of small 
entities. If the agency determines that it will, the agency must 
prepare a regulatory flexibility analysis as described in the RFA.
    However, if an agency determines that a rule is not expected to 
have a significant economic impact on a substantial number of small 
entities, section 605(b) of the RFA provides that the head of the 
agency may so certify and a regulatory flexibility analysis is not 
required. The certification must include a statement providing the 
factual basis for this determination, and the reasoning should be 
clear.
    The provisions of this final rule (1) are minimal cost, (2) would 
impose no additional costs because the provisions would clarify only, 
or are current practice, or (3) are voluntary. We received no comments 
regarding our determination that there was no significant impact on a 
substantial number of small entities in the NPRM.
    Therefore, as provided in section 605(b), the head of the FAA 
certifies that this final rule will not have a significant economic 
impact on a substantial number of small entities.

C. International Trade Impact Assessment

    The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the 
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal 
agencies from establishing standards or engaging in related activities 
that create unnecessary obstacles to the foreign commerce of the United 
States. Pursuant to these Acts, the

[[Page 59030]]

establishment of standards is not considered an unnecessary obstacle to 
the foreign commerce of the United States, so long as the standard has 
a legitimate domestic objective, such as the protection of safety, and 
does not operate in a manner that excludes imports that meet this 
objective. The statute also requires consideration of international 
standards and, where appropriate, that they be the basis for U.S. 
standards.
    The FAA has assessed the potential effect of this final rule and 
determined that the rule's provision allowing PAHs to issue authorized 
release documents for purposes of export would be in accordance with 
the Trade Agreements Act as this provision uses European standards as 
the basis for United States regulation. The remaining provisions have a 
minimal domestic impact only and therefore no effect on international 
trade.

D. Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (Public Law 
104-4) requires each Federal agency to prepare a written statement 
assessing the effects of any Federal mandate in a proposed or final 
agency rule that may result in an expenditure of $100 million or more 
(in 1995 dollars) in any one year by State, local, and tribal 
governments, in the aggregate, or by the private sector; such a mandate 
is deemed to be a ``significant regulatory action.'' The FAA currently 
uses an inflation-adjusted value of $155 million in lieu of $100 
million. This final rule does not contain such a mandate; therefore, 
the requirements of Title II of the Act do not apply.

E. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires 
that the FAA consider the impact of paperwork and other information 
collection burdens imposed on the public. The FAA has determined that 
there is no new requirement for information collection associated with 
this final rule.

F. International Compatibility and Cooperation

    In keeping with U.S. obligations under the Convention on 
International Civil Aviation, it is FAA policy to conform to 
International Civil Aviation Organization (ICAO) Standards and 
Recommended Practices to the maximum extent practicable. The FAA 
reviewed the corresponding ICAO Standards and Recommended Practices and 
identified no differences with these regulations.
    Executive Order 13609, Promoting International Regulatory 
Cooperation, promotes international regulatory cooperation to meet 
shared challenges involving health, safety, labor, security, 
environmental, and other issues and to reduce, eliminate, or prevent 
unnecessary differences in regulatory requirements. The FAA analyzed 
this action under the policies and agency responsibilities of Executive 
Order 13609, and determined that this action has no significant effect 
on international regulatory cooperation. To the extent that this final 
rule may conflict with the implementing protocols of any FAA bilateral 
aviation safety agreements, the FAA will amend those protocols in 
coordination with our international partners.

G. Environmental Analysis

    FAA Order 1050.1E identifies FAA actions that are categorically 
excluded from preparation of an environmental assessment or 
environmental impact statement under the National Environmental Policy 
Act in the absence of extraordinary circumstances. The FAA has 
determined this rulemaking action qualifies for the categorical 
exclusion identified in paragraph 312f and involves no extraordinary 
circumstances.

V. Executive Order Determinations

A. Executive Order 13132, Federalism

    The FAA has analyzed this final rule under the principles and 
criteria of Executive Order 13132, Federalism. The agency determined 
that this action will not have a substantial direct effect on the 
States, or the relationship between the Federal Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, and, therefore, does not have Federalism 
implications.

B. Executive Order 13211, Regulations That Significantly Affect Energy 
Supply, Distribution, or Use

    The FAA analyzed this final rule under Executive Order 13211, 
Actions Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (May 18, 2001). The agency has determined that it 
is not a ``significant energy action'' under the executive order and it 
is not likely to have a significant adverse effect on the supply, 
distribution, or use of energy.

VI. How To Obtain Additional Information

A. Rulemaking Documents

    An electronic copy of a rulemaking document may be obtained by 
using the Internet by--
    1. Search the Federal eRulemaking Portal (http://www.regulations.gov);
    2. Visit the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies/ or
    3. Access the Government Printing Office's Web page at http://www.gpo.gov/fdsys/.
    Copies may also be obtained by sending a request (identified by 
notice, amendment, or docket number of this rulemaking) to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680.

B. Comments Submitted to the Docket

    Comments received may be viewed by going to http://www.regulations.gov and following the online instructions to search the 
docket number for this action. Anyone is able to search the electronic 
form of all comments received into any of the FAA's dockets by the name 
of the individual submitting the comment (or signing the comment, if 
submitted on behalf of an association, business, labor union, etc.).

C. Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires FAA to comply with small entity requests for information 
or advice about compliance with statutes and regulations within its 
jurisdiction. A small entity with questions regarding this document, 
may contact its local FAA official, or the person listed under the FOR 
FURTHER INFORMATION CONTACT heading at the beginning of the preamble. 
To find out more about SBREFA on the Internet, visit http://www.faa.gov/regulations_policies/rulemaking/sbre_act/.

List of Subjects

14 CFR Part 21

    Aircraft, Aviation safety, Exports, Imports, Reporting and 
recordkeeping requirements.

14 CFR Part 45

    Aircraft, Exports, Signs and symbols.

The Amendment

    In consideration of the foregoing, and under the authority of 49 
U.S.C. 106(f) and 44701(a)(5), the Federal Aviation Administration 
proposes to amend

[[Page 59031]]

chapter I of title 14, Code of Federal Regulations as follows:

PART 21--CERTIFICATION PROCEDURES FOR PRODUCTS AND ARTICLES

0
1. The authority citation for part 21 continues to read as follows:

    Authority: 42 U.S.C. 7572; 49 U.S.C. 106(g), 40105, 40113, 
44701-44702, 44704, 44707, 44709, 44711, 44713, 44715, 45303.

0
2. The heading for part 21 is revised to read as set forth above.

0
3. Amend Sec.  21.1 by revising paragraph (b)(1), redesignating 
paragraphs (b)(5) through (b)(8) as (b)(6) through (b)(9), and adding 
new paragraphs (b)(5) and (b)(10) to read as follows:

Sec.  21.1  Applicability and definitions.

* * * * *
    (b) * * *
    (1) Airworthiness approval means a document, issued by the FAA for 
an aircraft, aircraft engine, propeller, or article, which certifies 
that the aircraft, aircraft engine, propeller, or article conforms to 
its approved design and is in a condition for safe operation, unless 
otherwise specified;
* * * * *
    (5) Interface component means an article that serves as a 
functional interface between an aircraft and an aircraft engine, an 
aircraft engine and a propeller, or an aircraft and a propeller. An 
interface component is designated by the holder of the type certificate 
or the supplemental type certificate who controls the approved design 
data for that article;
* * * * *
    (10) Supplier means a person at any tier in the supply chain who 
provides a product, article, or service that is used or consumed in the 
design or manufacture of, or installed on, a product or article.

0
4. Revise Sec.  21.135 to read as follows:

Sec.  21.135  Organization.

    (a) Each applicant for or holder of a production certificate must 
provide the FAA with a document--
    (1) Describing how its organization will ensure compliance with the 
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities, 
and the functional relationship of those responsible for quality to 
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this 
section must be responsible within the applicant's or production 
approval holder's organization for, and have authority over, all 
production operations conducted under this part. The accountable 
manager must confirm that the procedures described in the quality 
manual required by Sec.  21.138 are in place and that the production 
approval holder satisfies the requirements of the applicable 
regulations of subchapter C, Aircraft. The accountable manager must 
serve as the primary contact with the FAA.

0
5. Amend Sec.  21.137 by revising paragraphs (c)(1) and (2) and adding 
paragraph (o) to read as follows:

Sec.  21.137  Quality system.

* * * * *
    (c) * * *
    (1) Ensure that each supplier-provided product, article, or service 
conforms to the production approval holder's requirements; and
    (2) Establish a supplier-reporting process for products, articles, 
or services that have been released from or provided by the supplier 
and subsequently found not to conform to the production approval 
holder's requirements.
* * * * *
    (o) Issuing authorized release documents. Procedures for issuing 
authorized release documents for aircraft engines, propellers, and 
articles if the production approval holder intends to issue those 
documents. These procedures must provide for the selection, 
appointment, training, management, and removal of individuals 
authorized by the production approval holder to issue authorized 
release documents. Authorized release documents may be issued for new 
aircraft engines, propellers, and articles manufactured by the 
production approval holder; and for used aircraft engines, propellers, 
and articles when rebuilt, or altered, in accordance with Sec.  43.3(j) 
of this chapter. When a production approval holder issues an authorized 
release document for the purpose of export, the production approval 
holder must comply with the procedures applicable to the export of new 
and used aircraft engines, propellers, and articles specified in Sec.  
21.331 and the responsibilities of exporters specified in Sec.  21.335.

0
6. Revise Sec.  21.142 to read as follows:

Sec.  21.142  Production limitation record.

    The FAA issues a production limitation record as part of a 
production certificate. The record lists the type certificate number 
and model of every product that the production certificate holder is 
authorized to manufacture, and identifies every interface component 
that the production certificate holder is authorized to manufacture and 
install under this part.

0
7. Revise Sec.  21.147 to read as follows:

Sec.  21.147  Amendment of production certificates.

    (a) A holder of a production certificate must apply for an 
amendment to a production certificate in a form and manner prescribed 
by the FAA.
    (b) An applicant for an amendment to a production certificate to 
add a type certificate or model, or both, must comply with Sec. Sec.  
21.137, 21.138, and 21.150.
    (c) An applicant may apply to amend its production limitation 
record to allow the manufacture and installation of an interface 
component, provided--
    (1) The applicant owns or has a license to use the design and 
installation data for the interface component and makes that data 
available to the FAA upon request;
    (2) The applicant manufactures the interface component;
    (3) The applicant's product conforms to its approved type design 
and the interface component conforms to its approved type design;
    (4) The assembled product with the installed interface component is 
in a condition for safe operation; and
    (5) The applicant complies with any other conditions and 
limitations the FAA considers necessary.

0
8. Revise Sec.  21.305 to read as follows:

Sec.  21.305  Organization.

    (a) Each applicant for or holder of a PMA must provide the FAA with 
a document--
    (1) Describing how its organization will ensure compliance with the 
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities, 
and the functional relationship of those responsible for quality to 
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this 
section must be responsible within the applicant's or production 
approval holder's organization for, and have authority over, all 
production operations conducted under this part. The accountable 
manager must confirm that the procedures described in the quality 
manual required by Sec.  21.308 are in place and that the production 
approval holder

[[Page 59032]]

satisfies the requirements of the applicable regulations of subchapter 
C, Aircraft. The accountable manager must serve as the primary contact 
with the FAA.
0
9. Revise Sec.  21.605 to read as follows:

Sec.  21.605  Organization.

    (a) Each applicant for or holder of a TSO authorization must 
provide the FAA with a document--
    (1) Describing how its organization will ensure compliance with the 
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities, 
and the functional relationship of those responsible for quality to 
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this 
section must be responsible within the applicant's or production 
approval holder's organization for, and have authority over, all 
production operations conducted under this part. The accountable 
manager must confirm that the procedures described in the quality 
manual required by Sec.  21.608 are in place and that the production 
approval holder satisfies the requirements of the applicable 
regulations of subchapter C, Aircraft. The accountable manager must 
serve as the primary contact with the FAA.

PART 45--IDENTIFICATION AND REGISTRATION MARKING

0
10. The authority citation for part 45 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40103, 40113-40114, 44101-44105, 
44107-44111, 44504, 44701, 44708-44709, 44711-44713, 44725, 45302-
45303, 46104, 46304, 46306, 47122.

0
11. Revise Sec.  45.11(c) introductory text to read as follows:

Sec.  45.11  Marking of products.

* * * * *
    (c) Propellers and propeller blades and hubs. Each person who 
produces a propeller, propeller blade, or propeller hub under a type 
certificate or production certificate must mark each product or part. 
Except for a fixed-pitch wooden propeller, the marking must be 
accomplished using an approved fireproof method. The marking must--
* * * * *

    Issued under authority provided by 49 U.S.C. 106(f), 44701(a), 
and 44703 in Washington, DC, on September 25, 2015.
Michael P. Huerta,
Administrator.
[FR Doc. 2015-24950 Filed 9-30-15; 8:45 am]
BILLING CODE 4910-13-P
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