Federal Register / Vol. 85, No. 118 / Thursday, June 18, 2020 / Rules and Regulations 36717 

1978); E.O. 12674, 54 FR 15159, 3 CFR, 1989 

Comp., p. 215, as modified by E.O. 12731, 55 

FR 42547, 3 CFR, 1990 Comp., p. 306. 

§ 2635.204 [Amended] 

■ 5. In § 2635.204, in paragraph 

(g)(3)(iv) and examples 1 and 4 

following paragraph (g)(6), remove the 

dollar amount ‘‘$390’’ and add in its 

place ‘‘$415’’ wherever it occurs. 

[FR Doc. 2020–12357 Filed 6–17–20; 8:45 am] 

BILLING CODE 6345–03–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 120 

[Docket No. SBA–2020–0036] 

RIN 3245–AH50 

Business Loan Program Temporary 

Changes; Paycheck Protection 

Program—Additional Revisions to First 

Interim Final Rule 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Interim final rule. 

SUMMARY: On April 2, 2020, the U.S. 

Small Business Administration (SBA) 

posted on its website an interim final 

rule relating to the implementation of 

sections 1102 and 1106 of the 

Coronavirus Aid, Relief, and Economic 

Security Act (CARES Act or the Act) 

(published in the Federal Register on 

April 15, 2020). Section 1102 of the Act 

temporarily adds a new product, titled 

the ‘‘Paycheck Protection Program,’’ to 

the U.S. Small Business 

Administration’s (SBA’s) 7(a) Loan 

Program. Subsequently, SBA issued a 

number of interim final rules 

implementing the Paycheck Protection 

Program. This interim final rule revises 

SBA’s interim final rule published in 

the Federal Register on April 15, 2020 

by changing the eligibility requirement 

related to felony convictions of 

applicants or owners of the applicant. 

DATES: 

Effective date: The provisions in this 

interim final rule are effective June 16, 

2020. 

Comment date: Comments must be 

received on or before July 20, 2020. 

ADDRESSES: You may submit comments, 

identified by number SBA–2020–0036, 

through the Federal eRulemaking Portal: 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

SBA will post all comments on 

www.regulations.gov. If you wish to 

submit confidential business 

information (CBI) as defined in the User 

Notice at www.regulations.gov, please 

send an email to ppp-ifr@sba.gov. 

Highlight the information that you 

consider to be CBI and explain why you 

believe SBA should hold this 

information as confidential. SBA will 

review the information and make the 

final determination whether it will 

publish the information. 

FOR FURTHER INFORMATION CONTACT: A 

Call Center Representative at 833–572– 

0502, or the local SBA Field Office; the 

list of offices can be found at https://

www.sba.gov/tools/local-assistance/ 

districtoffices. 

SUPPLEMENTARY INFORMATION: 

I. Background Information 

On March 13, 2020, President Trump 

declared the ongoing Coronavirus 

Disease 2019 (COVID–19) pandemic of 

sufficient severity and magnitude to 

warrant an emergency declaration for all 

states, territories, and the District of 

Columbia. With the COVID–19 

emergency, many small businesses 

nationwide are experiencing economic 

hardship as a direct result of the 

Federal, State, and local public health 

measures that are being taken to 

minimize the public’s exposure to the 

virus. These measures, some of which 

are government-mandated, have been 

implemented nationwide and include 

the closures of restaurants, bars, and 

gyms. In addition, based on the advice 

of public health officials, other 

measures, such as keeping a safe 

distance from others or even stay-athome orders, have been implemented, 

resulting in a dramatic decrease in 

economic activity as the public avoids 

malls, retail stores, and other 

businesses. 

On March 27, 2020, the President 

signed the Coronavirus Aid, Relief, and 

Economic Security Act (the CARES Act 

or the Act) (Pub. L. 116–136) to provide 

emergency assistance and health care 

response for individuals, families, and 

businesses affected by the coronavirus 

pandemic. The Small Business 

Administration (SBA) received funding 

and authority through the Act to modify 

existing loan programs and establish a 

new loan program to assist small 

businesses nationwide adversely 

impacted by the COVID–19 emergency. 

Section 1102 of the Act temporarily 

permits SBA to guarantee 100 percent of 

7(a) loans under a new program titled 

the ‘‘Paycheck Protection Program.’’ 

Section 1106 of the Act provides for 

forgiveness of up to the full principal 

amount of qualifying loans guaranteed 

under the Paycheck Protection Program. 

On April 24, 2020, the President 

signed the Paycheck Protection Program 

and Health Care Enhancement Act (Pub. 

L. 116–139), which provided additional 

funding and authority for the PPP. On 

June 5, 2020, the President signed the 

Paycheck Protection Program Flexibility 

Act of 2020 (Flexibility Act) (Pub. L. 

116–142). 

II. Comments and Immediate Effective 

Date 

This interim final rule is effective 

without advance notice and public 

comment because section 1114 of the 

CARES Act authorizes SBA to issue 

regulations to implement Title I of the 

Act without regard to notice 

requirements. In addition, SBA has 

determined that there is good cause for 

dispensing with advance public notice 

and comment on the grounds that that 

it would be contrary to the public 

interest. Specifically, advance public 

notice and comment would defeat the 

purpose of this interim final rule given 

that SBA’s authority to guarantee PPP 

loans expires on June 30, 2020. These 

same reasons provide good cause for 

SBA to dispense with the 30-day 

delayed effective date provided in the 

Administrative Procedure Act. Although 

this interim final rule is effective on or 

before date of filing, comments are 

solicited from interested members of the 

public on all aspects of the interim final 

rule, including section III below. These 

comments must be submitted on or 

before July 20. 2020. The SBA will 

consider these comments, comments 

received on the interim final rule posted 

on SBA’s website April 2, 2020 (the 

First Interim Final Rule) and published 

in the Federal Register on April 15, 

2020, and the need for making any 

revisions as a result of these comments. 

III. Paycheck Protection Program— 

Additional Revisions to First Interim 

Final Rule (85 FR 20811) 

Overview 

The CARES Act was enacted to 

provide immediate assistance to 

individuals, families, and businesses 

affected by the COVID–19 emergency. 

Among the provisions contained in the 

CARES Act are provisions authorizing 

SBA to temporarily guarantee loans 

under a new 7(a) loan program titled the 

‘‘Paycheck Protection Program.’’ Loans 

guaranteed under the Paycheck 

Protection Program (PPP) will be 100 

percent guaranteed by SBA, and the full 

principal amount of the loans may 

qualify for loan forgiveness. The 

purpose of this interim final rule is to 

make changes to the First Interim Final 

Rule, posted on SBA’s website on April 

2, 2020, and published in the Federal 

Register on April 15, 2020 (85 FR 

20811). The First Interim Final Rule, as 

amended, should be interpreted 

36718 Federal Register / Vol. 85, No. 118 / Thursday, June 18, 2020 / Rules and Regulations 

1See https://www.sba.gov/document/support— 

faq-lenders-borrowers. 

2See https://www.sba.gov/funding-programs/ 

loans/coronavirus-relief-options/paycheckprotection-program. 

consistent with the frequently asked 

questions (FAQs) regarding the PPP that 

are posted on SBA’s website 1 and the 

other interim final rules issued 

regarding the PPP.2

1. Changes to the First Interim Final 

Rule 

Eligibility Requirements 

The First Interim Final Rule provided, 

among other things, that a PPP loan will 

not be approved if an owner of 20 

percent or more of the equity of the 

applicant has been convicted of a felony 

within the last five years. After further 

consideration, the Administrator, in 

consultation with the Secretary of the 

Treasury (the Secretary), has determined 

that a shorter timeframe for felonies that 

do not involve fraud, bribery, 

embezzlement, or a false statement in a 

loan application or an application for 

federal financial assistance is more 

consistent with Congressional intent to 

provide relief to small businesses and 

also promotes the important policies 

underlying the First Step Act of 2018 

(Pub. L. 115–391). Therefore, Part 

III.2.b.iii. of the First Interim Final Rule 

(85 FR 20811, 20812) is revised to read 

as follows: 

b. Could I be ineligible even if I meet 

the eligibility requirements in (a) above? 

You are ineligible for a PPP loan if, for 

example: 

* * * * * 

iii. An owner of 20 percent or more 

of the equity of the applicant is 

incarcerated, on probation, on parole; 

presently subject to an indictment, 

criminal information, arraignment, or 

other means by which formal criminal 

charges are brought in any jurisdiction; 

or has been convicted of a felony 

involving fraud, bribery, embezzlement, 

or a false statement in a loan application 

or an application for federal financial 

assistance within the last five years or 

any other felony within the last year; or 

* * * * * 

2. Additional Information 

SBA may provide further guidance, if 

needed, through SBA notices which will 

be posted on SBA’s website at 

www.sba.gov. Questions on the 

Paycheck Protection Program may be 

directed to the Lender Relations 

Specialist in the local SBA Field Office. 

The local SBA Field Office may be 

found at https://www.sba.gov/tools/ 

local-assistance/districtoffices. 

Compliance With Executive Orders 

12866, 12988, 13132, 13563, and 13771, 

the Paperwork Reduction Act (44 

U.S.C. Ch. 35), and the Regulatory 

Flexibility Act (5 U.S.C. 601–612) 

Executive Orders 12866, 13563, and 

13771 

This interim final rule is 

economically significant for the 

purposes of Executive Orders 12866 and 

13563, and is considered a major rule 

under the Congressional Review Act. 

SBA, however, is proceeding under the 

emergency provision at Executive Order 

12866 Section 6(a)(3)(D) based on the 

need to move expeditiously to mitigate 

the current economic conditions arising 

from the COVID–19 emergency. This 

rule’s designation under Executive 

Order 13771 will be informed by public 

comment. 

This rule is necessary to implement 

Sections 1102 and 1106 of the CARES 

Act and the Flexibility Act in order to 

provide economic relief to small 

businesses nationwide adversely 

impacted under the COVID–19 

Emergency Declaration. We anticipate 

that this rule will result in substantial 

benefits to small businesses, their 

employees, and the communities they 

serve. However, we lack data to estimate 

the effects of this rule. 

Executive Order 12988 

SBA has drafted this rule, to the 

extent practicable, in accordance with 

the standards set forth in section 3(a) 

and 3(b)(2) of Executive Order 12988, to 

minimize litigation, eliminate 

ambiguity, and reduce burden. The rule 

has no preemptive effect but does have 

a limited retroactive effect consistent 

with section 3(d) of the Flexibility Act. 

Executive Order 13132 

SBA has determined that this rule 

will not have substantial direct effects 

on the States, on the relationship 

between the National Government and 

the States, or on the distribution of 

power and responsibilities among the 

various layers of government. Therefore, 

SBA has determined that this rule has 

no federalism implications warranting 

preparation of a federalism assessment. 

Paperwork Reduction Act, 44 U.S.C. 

Chapter 35 

SBA has determined that this rule 

will require modification to the existing 

PPP information collection that is 

approved under OMB Control Number 

3245–0407 as an emergency request 

until October 31, 2020. As discussed 

above, this rule amends the PPP 

eligibility requirements regarding 

certain felony charges. As a result of 

these amendments, conforming changes 

will be made to Question 6 of Form 

2483, Borrower Application Form, and 

Section H of Form 2484, Lender 

Application Form. SBA will submit the 

revisions to these forms to the Office of 

Management and Budget for approval. 

Regulatory Flexibility Act (RFA) 

The Regulatory Flexibility Act (RFA) 

generally requires that when an agency 

issues a proposed rule, or a final rule 

pursuant to section 553(b) of the APA or 

another law, the agency must prepare a 

regulatory flexibility analysis that meets 

the requirements of the RFA and 

publish such analysis in the Federal 

Register. 5 U.S.C. 603, 604. Specifically, 

the RFA normally requires agencies to 

describe the impact of a rulemaking on 

small entities by providing a regulatory 

impact analysis. Such analysis must 

address the consideration of regulatory 

options that would lessen the economic 

effect of the rule on small entities. The 

RFA defines a ‘‘small entity’’ as (1) a 

proprietary firm meeting the size 

standards of the Small Business 

Administration (SBA); (2) a nonprofit 

organization that is not dominant in its 

field; or (3) a small government 

jurisdiction with a population of less 

than 50,000. 5 U.S.C. 601(3)–(6). Except 

for such small government jurisdictions, 

neither State nor local governments are 

‘‘small entities.’’ Similarly, for purposes 

of the RFA, individual persons are not 

small entities. 

The requirement to conduct a 

regulatory impact analysis does not 

apply if the head of the agency ‘‘certifies 

that the rule will not, if promulgated, 

have a significant economic impact on 

a substantial number of small entities.’’ 

5 U.S.C. 605(b). The agency must, 

however, publish the certification in the 

Federal Register at the time of 

publication of the rule, ‘‘along with a 

statement providing the factual basis for 

such certification.’’ If the agency head 

has not waived the requirements for a 

regulatory flexibility analysis in 

accordance with the RFA’s waiver 

provision, and no other RFA exception 

applies, the agency must prepare the 

regulatory flexibility analysis and 

publish it in the Federal Register at the 

time of promulgation or, if the rule is 

promulgated in response to an 

emergency that makes timely 

compliance impracticable, within 180 

days of publication of the final rule. 5 

U.S.C. 604(a), 608(b). 

Rules that are exempt from notice and 

comment are also exempt from the RFA 

requirements, including conducting a 

regulatory flexibility analysis, when 

among other things the agency for good 

cause finds that notice and public 

Federal Register / Vol. 85, No. 118 / Thursday, June 18, 2020 / Rules and Regulations 36719 

procedure are impracticable, 

unnecessary, or contrary to the public 

interest. Small Business 

Administration’s Office of Advocacy 

guide: How to Comply with the 

Regulatory Flexibility Act, Ch.1. p.9. 

Accordingly, SBA is not required to 

conduct a regulatory flexibility analysis. 

Authority: 15 U.S.C. 636(a)(36); 

Coronavirus Aid, Relief, and Economic 

Security Act, Pub. L. 116–136, Section 1114. 

Jovita Carranza, 

Administrator. 

[FR Doc. 2020–13130 Filed 6–16–20; 2:00 pm] 

BILLING CODE 8026–03–P 

DEPARTMENT OF COMMERCE 

Bureau of Industry and Security 

15 CFR Parts 744 and 772 

[Docket No. 200611–0158] 

RIN 0694–AI06 

Release of ‘‘Technology’’ to Certain 

Entities on the Entity List in the 

Context of Standards Organizations 

AGENCY: Bureau of Industry and 

Security, Commerce. 

ACTION: Interim final rule; request for 

comments. 

SUMMARY: Huawei Technologies Co., 

Ltd. (Huawei) and 114 of its foreign 

affiliates were added to the Entity List 

by the Bureau of Industry and Security 

(BIS) in 2019, but continue to 

participate in many important 

international standards organizations in 

which U.S. companies also participate. 

As international standards serve as the 

building blocks for product 

development and help ensure 

functionality, interoperability, and 

safety of the products, it is important to 

U.S. technological leadership that U.S. 

companies be able to work in these 

bodies in order to ensure that U.S. 

standards proposals are fully 

considered. Since Huawei’s addition to 

the Entity List, organizations have 

consequently sought clarity about U.S. 

industry participation in standards 

development. BIS is amending the 

Export Administration Regulations 

(EAR) to authorize the release of certain 

technology to Huawei and its affiliates 

on the Entity List without a license if 

such release is made for the purpose of 

contributing to the revision or 

development of a ‘‘standard’’ in a 

‘‘standards organization.’’ For the 

purpose of this interim final rule, a 

‘‘standard’’ is as defined in Office of 

Management and Budget (OMB) 

Circular A–119: Federal Participation in 

the Development and Use of Voluntary 

Consensus Standards and in Conformity 

Assessment Activities, and a ‘‘standards 

organization,’’ is the equivalent of a 

‘‘voluntary consensus standards body’’ 

as defined in Office of Management and 

Budget (OMB) Circular A–119: Federal 

Participation in the Development and 

Use of Voluntary Consensus Standards 

and in Conformity Assessment 

Activities. This interim final rule does 

not change the assessment of whether 

‘‘technology’’ is subject to the EAR. BIS 

is requesting comments on the impact of 

these revisions. 

DATES: This rule is effective June 18, 

2020. Submit comments on or before 

August 17, 2020. 

ADDRESSES: You may submit comments, 

identified by docket number BIS 2020– 

0017 or RIN 0694–AI06, through the 

Federal eRulemaking Portal: http://

www.regulations.gov. Follow the 

instructions for submitting comments. 

All filers using the portal should use 

the name of the person or entity 

submitting comments as the name of 

their files, in accordance with the 

instructions below. Anyone submitting 

business confidential information 

should clearly identify the business 

confidential portion at the time of 

submission, file a statement justifying 

nondisclosure and referencing the 

specific legal authority claimed, and 

provide a non-confidential version of 

the submission. 

For comments submitted 

electronically containing business 

confidential information, the file name 

of the business confidential version 

should begin with the characters ‘‘BC.’’ 

Any page containing business 

confidential information must be clearly 

marked ‘‘BUSINESS CONFIDENTIAL’’ 

on the top of that page. The 

corresponding non-confidential version 

of those comments must be clearly 

marked ‘‘PUBLIC.’’ The file name of the 

non-confidential version should begin 

with the character ‘‘P.’’ The ‘‘BC’’ and 

‘‘P’’ should be followed by the name of 

the person or entity submitting the 

comments or rebuttal comments. All 

filers should name their files using the 

name of the person or entity submitting 

the comments. Any submissions with 

file names that do not begin with a ‘‘BC’’ 

or ‘‘P’’ will be assumed to be public and 

will be made publicly available through 

http://www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: 

Susan Kramer, Regulatory Policy 

Division, Bureau of Industry and 

Security, Department of Commerce. 

Phone: (202) 482–2440; Fax (202) 482– 

3355; Email: Susan.Kramer@bis.doc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The Bureau of Industry and Security 

(BIS) has continued to receive questions 

regarding the applicability of the Export 

Administration Regulations (15 CFR 

730–774) (EAR) in the context of 

standards setting or development in 

light of the addition of Huawei 

Technologies Co., Ltd. (Huawei) and its 

114 non-U.S. affiliates to the Entity List 

(Supplement No. 4 to part 744 of the 

EAR) (see 84 FR 22961 (May 21, 2019) 

and 84 FR 43493 (August 21, 2019)) and 

the Temporary General License (TGL). 

The TGL was published on May 22, 

2019 (84 FR 23468), extended and 

amended through a final rule published 

on August 21, 2019 (84 FR 43487), and 

is currently extended through August 

13, 2020 in a final rule published on 

May 18, 2020 (85 FR 29610). On August 

19, 2019, BIS posted a ‘‘General 

Advisory Opinion Concerning 

Prohibited Activities in the Standards 

Setting or Development Context When a 

Listed Entity Is Involved’’ to the BIS 

website that addressed the applicability 

of § 734.7 of the EAR (Published) (15 

CFR 734.7) to certain types of releases. 

With publication of this rule, that 

advisory opinion is rescinded, and BIS 

has removed the guidance from its 

website. This rule removes certain 

license requirements imposed by the 

original listing, removing the need to 

determine the application of controls to 

those releases. 

The assessment of whether 

‘‘technology’’ is subject to the EAR is 

the same regardless of whether a person 

on the Entity List is a member of, or 

participates in, the standards setting or 

development group or body. Because of 

the importance of U.S. participation and 

leadership in standards organizations, 

and in view of the consistent concerns 

expressed with Huawei’s participation 

therein, this rule revises the Entity List 

to authorize certain releases of 

technology without a license. 

Specifically, technology subject to the 

EAR that is designated as EAR99 or 

controlled on the Commerce Control 

List only for anti-terrorism (AT) reasons 

may be released to members of a 

standards organization without a 

license, including Huawei, if released 

for the purpose of contributing to the 

revision or development of a standard. 

This interim final rule adopts in § 772.1 

(Definitions) the definitions of 

‘‘standard’’ and ‘‘standards 

organization’’ from the Office of 

Management and Budget (OMB) 

Circular A–119: Federal Participation in 

the Development and Use of Voluntary 

Consensus Standards and in Conformity