28370 Federal Register / Vol. 83, No. 118 / Tuesday, June 19, 2018 / Rules and Regulations 

assessment body, the laboratory can 

apply to CPSC to include 16 CFR part 

1231, Safety Standard for High Chairs, 

in the laboratory’s scope of accreditation 

of CPSC safety rules listed on the CPSC 

website at: www.cpsc.gov/labsearch. 

As the RFA requires, CPSC staff 

conducted a FRFA for the rulemaking in 

which the Commission adopted part 

1112. 78 FR 15836, 15855–58. To 

summarize, the FRFA concluded that 

the accreditation requirements would 

not have a significant economic impact 

on a substantial number of small 

laboratories because no requirements 

were imposed on laboratories that did 

not intend to provide third party testing 

services. The only laboratories CPSC 

expected to provide such services were 

those that anticipated receiving 

sufficient revenue from the mandated 

testing to justify accepting the 

requirements as a business decision. 

By the same reasoning, adding an 

NOR for the high chair standard to part 

1112 will not have a significant 

economic impact on small test 

laboratories. A relatively small number 

of laboratories in the United States have 

applied for accreditation to test for 

conformance to existing juvenile 

product standards. Accordingly, CPSC 

expects that only a few laboratories will 

seek accreditation to test for compliance 

with the high chair standard. Of those 

that seek accreditation, CPSC expects 

that most will have already been 

accredited to test for conformance to 

other juvenile product standards. The 

only costs to those laboratories will be 

the cost of adding the high chair 

standard to their scopes of accreditation. 

For these reasons, CPSC certifies that 

amending 16 CFR part 1112 to include 

an NOR for the high chairs standard will 

not have a significant economic impact 

on a substantial number of small 

entities. 

List of Subjects 

16 CFR Part 1112 

Administrative practice and 

procedure, Audit, Consumer protection, 

Reporting and recordkeeping 

requirements, Third-party conformity 

assessment body. 

16 CFR Part 1231 

Consumer protection, Imports, 

Incorporation by reference, Infants and 

children, Labeling, Law enforcement, 

Toys. 

For the reasons discussed in the 

preamble, the Commission amends 16 

CFR chapter II as follows: 

PART 1112—REQUIREMENTS 

PERTAINING TO THIRD PARTY 

CONFORMITY ASSESSMENT BODIES 

■ 1. The authority citation for part 1112 

is revised to read as follows: 

Authority: Pub. L. 110–314, section 3, 122 

Stat. 3016, 3017 (2008); 15 U.S.C. 2063. 

■ 2. Amend § 1112.15 by adding 

paragraph (b)(44) to read as follows: 

§ 1112.15 When can a third party 

conformity assessment body apply for 

CPSC acceptance for a particular CPSC rule 

or test method? 

* * * * * 

(b) * * * 

(44) 16 CFR part 1231, Safety 

Standard for High Chairs. 

* * * * * 

■ 3. Add part 1231 to read as follows: 

PART 1231—SAFETY STANDARD FOR 

HIGH CHAIRS 

Sec. 

1231.1 Scope. 

1231.2 Requirements for high chairs. 

Authority: Sec. 104, Pub. L. 110–314, 122 

Stat. 3016 (August 14, 2008); Pub. L. 112–28, 

125 Stat. 273 (August 12, 2011). 

§ 1231.1 Scope. 

This part establishes a consumer 

product safety standard for high chairs. 

§ 1231.2 Requirements for high chairs. 

(a) Each high chair shall comply with 

all applicable provisions of ASTM 

F404–18, Standard Consumer Safety 

Specification for High Chairs, approved 

on February 15, 2018. The Director of 

the Federal Register approves this 

incorporation by reference in 

accordance with 5 U.S.C. 552(a) and 1 

CFR part 51. You may obtain a copy 

from ASTM International, 100 Bar 

Harbor Drive, P.O. Box 0700, West 

Conshohocken, PA 19428; http://

www.astm.org. You may inspect a copy 

at the Office of the Secretary, U.S. 

Consumer Product Safety Commission, 

Room 820, 4330 East West Highway, 

Bethesda, MD 20814, telephone 301– 

504–7923, or at the National Archives 

and Records Administration (NARA). 

For information on the availability of 

this material at NARA, call 202–741– 

6030, or go to: https://

www.archives.gov/federal-register/cfr/ 

ibr-locations.html. 

(b) [Reserved] 

Alberta E. Mills, 

Secretary, Consumer Product Safety 

Commission. 

[FR Doc. 2018–12938 Filed 6–18–18; 8:45 am] 

BILLING CODE 6355–01–P 

DEPARTMENT OF THE TREASURY 

Office of Foreign Assets Control 

31 CFR Part 592 

Rough Diamonds Control Regulations 

AGENCY: Office of Foreign Assets 

Control, Treasury. 

ACTION: Final rule. 

SUMMARY: The Department of the 

Treasury’s Office of Foreign Assets 

Control (OFAC) is amending the Rough 

Diamonds Control Regulations to clarify 

several reporting requirements and 

remove another, clarify which entity 

may issue Kimberley Process 

Certificates for the export of rough 

diamonds from the United States, clarify 

the steps necessary to validate a 

Kimberley Process Certificate, add two 

definitions that define rough diamond 

packaging requirements and Kimberley 

Process voided certificates, and make 

certain technical and conforming 

changes to the penalties section of the 

regulations. 

DATES: Effective Date: This rule is 

effective June 19, 2018. 

FOR FURTHER INFORMATION CONTACT: The 

Department of the Treasury’s Office of 

Foreign Assets Control: Assistant 

Director for Licensing, tel.: 202–622– 

2480, Assistant Director for Regulatory 

Affairs, tel.: 202–622–4855, Assistant 

Director for Sanctions Compliance & 

Evaluation, tel.: 202–622–2490; or the 

Department of the Treasury’s Office of 

the Chief Counsel (Foreign Assets 

Control), Office of the General Counsel, 

tel.: 202–622–2410. 

SUPPLEMENTARY INFORMATION: 

Electronic and Facsimile Availability 

This document and additional 

information concerning OFAC are 

available from OFAC’s website 

(www.treas.gov/ofac). 

Background 

On August 4, 2003, OFAC 

promulgated the Rough Diamonds 

Control Regulations, 31 CFR part 592 

(the ‘‘Regulations’’), to implement 

Executive Order 13312 (E.O. 13312) of 

July 29, 2003. E.O. 13312 was issued to 

implement the Clean Diamond Trade 

Act (Pub. L. 108–19) (CDTA) and the 

multilateral Kimberley Process 

Certification Scheme for rough 

diamonds (KPCS). OFAC amended the 

Regulations on September 23, 2004 to 

revise certain reporting requirements 

(69 FR 56936). OFAC further amended 

the Regulations on May 21, 2008 (73 FR 

29433) to enhance the compilation of 

statistical data relating to the 


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importation and exportation of rough 

diamonds. 

Today, in consultation with the U.S. 

Department of Commerce, Bureau of the 

Census (Census Bureau), Department of 

State, and Department of Homeland 

Security, Customs and Border 

Protection (CBP), OFAC is again 

amending the Regulations. First, in 

coordination with a regulatory 

amendment by the Census Bureau (83 

FR 17749), OFAC is incorporating into 

the Regulations existing Census Bureau 

requirements for submission of 

Kimberley Process Certificates in 

connection with the importation and 

exportation of rough diamonds. In 

addition, OFAC is clarifying which 

entity may issue Kimberley Process 

Certificates for the export of rough 

diamonds from the United States and 

adding two definitions that define rough 

diamond packaging requirements and 

Kimberley Process voided certificates. 

Additionally, OFAC is making certain 

technical and conforming changes to the 

penalties section of the Regulations. 

Reporting requirements. First, in 

coordination with a regulatory 

amendment by the Census Bureau, 

OFAC is amending § 592.301 to 

incorporate existing Census Bureau 

requirements for submission of 

Kimberley Process Certificates in 

connection with the importation and 

exportation of rough diamonds. The 

Census Bureau is amending the Foreign 

Trade Regulations (FTR), 15 CFR part 

30, to clarify that the data it collects 

from Kimberley Process Certificates is 

collected in compliance with the CDTA 

and not Title 13, United States Code 

(U.S.C.), and to clarify submission 

requirements for and permissible uses of 

the Kimberley Process Certificates. In 

paragraph (a)(1)(iii) of § 592.301, OFAC 

is incorporating the existing 

requirement pursuant to the FTR that 

importers or customs brokers provide a 

copy of the Kimberley Process 

Certificate accompanying a shipment of 

rough diamonds to the Census Bureau 

immediately after entry of the rough 

diamonds in the United States. In 

paragraph (a)(1)(iv) of this section, 

OFAC is incorporating the FTR 

requirement that, with respect to rough 

diamond exports, the U.S. Principal 

Party in Interest or U.S. authorized 

agent, see 15 CFR 30.1, must provide a 

copy of the Kimberley Process 

Certificate to the Census Bureau 

immediately after export from the 

United States. In paragraph (a)(1)(v) of 

this section, OFAC is incorporating the 

FTR requirement that any voided 

certificate be provided to the Census 

Bureau immediately upon voiding. 

At the same time, in consultation with 

the Department of State, the Census 

Bureau, and CBP, OFAC is removing the 

requirement that all rough diamond 

importers and exporters file annual 

reports with the Department of State 

detailing their import, export, and 

stockpile information as previously set 

forth in § 592.502. OFAC has removed 

this requirement as unnecessary in light 

of alternate sources from which to 

obtain relevant information. 

Additional clarifications. In 

§ 592.301, OFAC is also adding new 

paragraph (a)(4) and amending and 

redesignating current paragraph (a)(4) as 

(a)(5). New paragraph (a)(4) of this 

section clarifies the criteria that a 

Kimberley Process Certificate issuer 

must meet, while an accompanying note 

clarifies that, as reflected in a 

Memorandum of Understanding (MOU) 

among the Department of State, the 

Census Bureau, and U.S. Kimberley 

Process Authority (USKPA), a non-profit 

association, Kimberley Process 

Certificates for the exportation of rough 

diamonds from the United States may 

only be issued at this time by the 

USKPA or by entities licensed to do so 

by the USKPA. The new paragraph also 

states that Kimberley Process 

Certificates may be issued ‘‘on behalf 

of’’ this entity. In addition, amended 

and redesignated paragraph (a)(5) of this 

section clarifies the steps necessary to 

validate a Kimberley Process Certificate 

prior to exporting rough diamonds from 

the United States. 

Definitions. OFAC is adding two 

definitions to the Regulations. The term 

Voided certificate, used in 

§ 592.301(a)(1)(v), is defined in new 

§ 592.313. Consistent with CBP’s 

practice, OFAC defines the term Voided 

certificate to mean ‘‘a Kimberley Process 

Certificate intended to be used for the 

exportation of rough diamonds from the 

United States that has been cancelled, 

for reasons such as loss or error.’’ 

OFAC is also defining the term 

Tamper-resistant container, used in 

§ 592.301(a)(2), by adding new 

§ 592.314. Consistent with CBP practice, 

OFAC defines the term Tamperresistant container to mean ‘‘packaging 

having an indicator or barrier to entry 

that could reasonably be expected to 

provide visible evidence that tampering 

had occurred.’’ A note to the definition 

further clarifies that standard mailing 

and express consignment packaging, or 

such packaging that simply contains a 

resealable plastic bag, is not considered 

to be a tamper-resistant container. This 

definition is intended to foster 

uniformity in CBP’s enforcement of 

rough diamond shipping requirements. 

OFAC is also making a conforming 

change in paragraph (a)(2) of § 592.301 

by changing ‘‘Tamper-resistant 

container’’ to ‘‘Tamper-resistance 

requirement.’’ 

Penalties. OFAC is also amending 

Subpart F, which describes the penalties 

applicable to violations of the 

Regulations, as well as the procedures 

governing the potential imposition of a 

civil monetary penalty or issuance of a 

Finding of Violation. OFAC is updating 

the language of this subpart and 

incorporating references to OFAC’s 

Economic Sanctions Enforcement 

Guidelines contained in appendix A to 

part 501 of this chapter. 

Public Participation 

Because the amendments to the 

Regulations involve a foreign affairs 

function, the provisions of Executive 

Order 12866 and the Administrative 

Procedure Act (5 U.S.C. 553) requiring 

notice of proposed rulemaking, 

opportunity for public participation, 

and delay in effective date, as well as 

the provisions of Executive Order 

13771, are inapplicable. Because no 

notice of proposed rulemaking is 

required for this rule, the Regulatory 

Flexibility Act (5 U.S.C. 601–612) does 

not apply. 

Paperwork Reduction Act 

With respect to section 2 of the 

Paperwork Reduction Act of 1995, 44 

U.S.C. 3507 (PRA), the collections of 

information in §§ 592.301(a)(1)(i) and 

(ii), 592.501, and 592.603 of the 

Regulations are made pursuant to 

OFAC’s Reporting, Procedures, and 

Penalties Regulations (31 CFR part 501) 

and have been approved by the Office 

of Management and Budget (OMB) 

under control number 1505–0164. 

Pursuant to the Census Bureau, the 

collections of information in 

§ 592.301(a)(1)(iii)–(v) and in 

§ 592.301(a)(5) related to exporter and 

importer reporting requirements and the 

FTR previously were approved by OMB 

under control number 0607–0152. 

OMB Approval 1505–0198: Report to 

foreign exporting authority. The 

collection of information in 

§ 592.301(a)(3) has been submitted to 

OMB for review and approval under 

control number 1505–0198. This 

collection of information assists in 

carrying out the requirements of the 

CDTA and KPCS and monitoring the 

integrity of international shipments of 

rough diamonds, including that the 

United States produce statistics on 

imports and exports of rough diamonds 

and that these statistics be made 

available for analysis by interested 

parties, including other governments 

participating in the KPCS. The 


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information collected will be used to 

assist the Census Bureau in carrying out 

its statistics-related functions and the 

State Department in its KPCS oversight 

functions, and to further the 

compliance, enforcement, and civil 

penalty programs of OFAC, CBP and 

U.S. Immigration and Customs 

Enforcement, each of which has 

enforcement authority under the CDTA 

and various implementing regulations. 

See §§ 5(a) and 8 of the CDTA. 

OMB Approval 1505–0198: Annual 

State report. The collection of 

information previously in § 592.502 and 

approved by OMB under control 

number 1505–0198 has been removed as 

unnecessary in light of alternate sources 

from which to obtain relevant 

information. 

With respect to all of the foregoing 

collections of information, an agency 

may not conduct or sponsor, and a 

person is not required to respond to, a 

collection of information subject to the 

requirements of the PRA, unless the 

collection of information displays a 

current, valid OMB control number. 

The likely respondents and 

recordkeepers affected by the collection 

of information in § 592.301(a)(3) (report 

to foreign exporting authority) and the 

removal of the collection of information 

in § 592.502 (Annual State report) are 

rough diamond importers and exporters. 

The anticipated number of respondents 

is approximately 80. OFAC expects that 

the majority of these respondents will 

report to foreign exporting authorities 

approximately 15 times per year. Based 

on information from rough diamond 

traders and CBP’s experience, roughly 

1,200 individual transaction reports are 

expected annually. The total number of 

burden hours associated with the 

individual transaction reports is 

anticipated to be 200. This is based on 

an estimated completion and 

submission time of 10 minutes per 

report. This is a decrease of 300 burden 

hours from the prior hour burden based 

on current estimates that indicate there 

are fewer respondents and fewer 

imports than previously assumed. Based 

on information from rough diamonds 

traders, OFAC does not expect the hour 

burden on respondents to vary widely. 

Additionally, OFAC understands that it 

is the customary and usual business 

practice for most traders to send a 

detailed acknowledgment of receipt of a 

shipment to their overseas counterparts 

to the transaction. 

As this regulatory amendment 

removes the annual State reporting 

requirement, the total number of burden 

hours is reduced by an estimated 1,250 

hours. This is based on an estimated 

completion and submission time of five 

hours per report. The overall reduction 

in burden hours is therefore this 

reduction of 1,250 burden hours plus 

the reduction of 300 burden hours with 

respect to the report to foreign exporting 

authorities for a total reduction of 1,550 

burden hours. The aggregate burden 

hours now associated with this 

information collection is 200 burden 

hours. 

Comments are invited on: (a) Whether 

this collection of information is 

necessary for the proper performance of 

the functions of the agency, including 

whether the information has practical 

utility; (b) the accuracy of the agency’s 

estimate of the burden of the collection 

of information; (c) ways to enhance the 

quality, utility, and clarity of the 

information to be collected; (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques and other forms of 

information technology; and (e) the 

estimated capital or start-up costs of the 

operation, maintenance, and/or 

purchase of services to provide 

information. Comments concerning the 

above information and the accuracy of 

these burden estimates, and suggestions 

for reducing this burden, should be 

directed to OMB, Attention: Desk 

Officer for the Department of the 

Treasury, Office of Information and 

Regulatory Affairs (OIRA), Washington, 

DC 20503 or by email to: OIRA_

Submission@omb.eop.gov, with a copy 

to Chief of Records, Attention: Request 

for Comments, Office of Foreign Assets 

Control, Department of the Treasury, 

1500 Pennsylvania Avenue NW, 

Freedman’s Bank Building, Washington, 

DC 20220. Any such comments should 

be submitted not later than July 19, 

2018. All comments on the collections 

of information in § 592.301(a)(3) and the 

removal of the collection of information 

in § 592.502 will be a matter of public 

record. 

List of Subjects in 31 CFR Part 592 

Administrative practice and 

procedure, Foreign trade, Exports, 

Imports, Kimberley Process, Penalties, 

Reporting and recordkeeping 

requirements, Rough diamond. 

For the reasons set forth in the 

preamble, the Office of Foreign Assets 

Control amends 31 CFR part 592 as 

follows: 

PART 592—ROUGH DIAMONDS 

CONTROL REGULATIONS 

■ 1. The authority citation for part 592 

is revised to read as follows: 

Authority: 3 U.S.C. 301; 19 U.S.C. 3901– 

3913; 28 U.S.C. 2461 note; 31 U.S.C. 321(b); 

E.O. 13312, 68 FR 45151, 3 CFR, 2003 Comp., 

p. 246. 

Subpart C—General Definitions 

■ 2. Amend § 592.301 by revising 

paragraphs (a)(1), (a)(2), and (a)(4), and 

adding paragraph (a)(5) to read as 

follows: 

§ 592.301 Controlled through the 

Kimberley Process Certification Scheme. 

(a) * * * 

(1) Kimberley Process Certificate. A 

shipment of rough diamonds imported 

into, or exported from, the United States 

must be accompanied by an original 

Kimberley Process Certificate. The 

certificate must be provided as follows: 

(i) The original certificate must be 

presented immediately upon demand to 

U.S. Customs and Border Protection in 

connection with an importation or 

exportation of rough diamonds; 

(ii) The person identified as the 

ultimate consignee (see Customs 

Directive 3550–079A) on the Customs 

Form 7501 Entry Summary or its 

electronic equivalent filed with U.S. 

Customs and Border Protection in 

connection with an importation of 

rough diamonds must retain the original 

Kimberley Process Certificate for a 

period of at least five years from the 

date of importation (see also 19 CFR 

12.152); 

(iii) The person identified as the 

ultimate consignee (see Customs 

Directive 3550–079A) on the Customs 

Form 7501 Entry Summary or its 

electronic equivalent filed with U.S. 

Customs and Border Protection in 

connection with an importation of 

rough diamonds must provide the 

certificate to the U.S. Bureau of the 

Census immediately after entry of the 

shipment in the United States. The 

certificate must be provided by faxing it 

to (800) 457–7328 or by other methods 

as permitted by the U.S. Bureau of the 

Census; 

(iv) The U.S. Principal Party in 

Interest or U.S. authorized agent (see 15 

CFR 30.1) must also provide the 

certificate to the U.S. Bureau of the 

Census immediately after export of the 

shipment of rough diamonds from the 

United States by faxing it to (800) 457– 

7328 or by other methods as permitted 

by the U.S. Bureau of the Census; and 

(v) Any voided certificate(s) must be 

provided to the U.S. Bureau of the 

Census immediately upon voiding by 

faxing it to (800) 457–7328 or by other 

methods as permitted by the U.S. 

Bureau of the Census (see § 592.313); 

(2) Tamper-resistance requirement. A 

shipment of rough diamonds imported 

into, or exported from, the United States 


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must be sealed in a tamper-resistant 

container; 

* * * * * 

(4) Issuance of Kimberley Process 

Certificate for exportations from the 

United States. Consistent with section 

5(c) of the Clean Diamond Trade Act 

(CDTA), the Kimberley Process 

Certificate accompanying a shipment of 

rough diamonds exported from the 

United States must be issued by, or on 

behalf of, an entity whose standards, 

practices, and procedures are annually 

reviewed by the appropriate U.S. 

Government agency, and that has 

reached an arrangement with such 

agency concerning the issuance of 

Kimberley Process Certificates 

consistent with the Kimberley Process 

Certification Scheme and the CDTA. 

Note to paragraph (a)(4): As reflected in a 

Memorandum of Understanding (MOU) 

among the U.S. Department of State, the U.S. 

Bureau of the Census, and the U.S. Kimberley 

Process Authority (USKPA), a non-profit 

association, Kimberley Process Certificates 

for the exportation of rough diamonds from 

the United States may only be issued at this 

time by the USKPA or by entities licensed to 

do so by the USKPA. Pursuant to this MOU, 

the U.S. Department of State annually 

reviews the USKPA’s standards, practices, 

and procedures. The Secretary of State may 

reassign this review function to any other 

officers, officials, departments, and agencies 

within the executive branch, consistent with 

applicable law. 

(5) Validation of Kimberley Process 

Certificate for exportations from the 

United States. With respect to the 

validation of a Kimberley Process 

Certificate for the exportation of rough 

diamonds from the United States, 

exporters must: 

(i) Report shipments to the U.S. 

Bureau of the Census through the 

Automated Export System (AES) or a 

successor system and obtain an Internal 

Transaction Number (ITN) prior to 

exportation. The ITN is the number 

generated by the AES and assigned to a 

shipment confirming that an Electronic 

Export Information (EEI) was accepted 

and is on file in the AES. 

(ii) Report the ITN on the Kimberley 

Process Certificate accompanying any 

exportation from the United States, 

which completes the validation process 

for the exportation of rough diamonds 

from the United States to a Participant. 

* * * * * 

■ 3. Add § 592.313 to subpart C to read 

as follows: 

§ 592.313 Voided certificate. 

The term voided certificate means a 

Kimberley Process Certificate intended 

to be used for the exportation of rough 

diamonds from the United States that 

has been cancelled for reasons such as 

loss or error. 

■ 4. Add § 592.314 to subpart C to read 

as follows: 

§ 592.314 Tamper-resistant container. 

The term tamper-resistant container 

means packaging having an indicator or 

barrier to entry that could reasonably be 

expected to provide visible evidence 

that tampering had occurred. Standard 

mailing and express consignment 

packaging, or such packaging that 

simply contains a resealable plastic bag, 

is not considered to be a tamperresistant container. 

Subpart E—Records and Reports 

§ 592.502 [Amended] 

■ 5. Remove § 592.502. 

Subpart F—Penalties 

■ 6. Amend § 592.601 by: 

■ a. Revising paragraph (a)(3); 

■ b. Revising the note to paragraph (a); 

and 

■ c. Revising paragraphs (c) and (d). 

The revisions read as follows: 

§ 592.601 Penalties. 

(a) * * * 

(3) Those customs laws of the United 

States, both civil and criminal, 

including those laws relating to seizure 

and forfeiture, that apply to articles 

imported in violation of such laws shall 

apply with respect to any rough 

diamond imported in violation of the 

Act. 

Note to paragraph (a): As reflected in 

paragraphs (a)(1) and (2) of this section, 

section 8(a) of the Act establishes penalties 

with respect to any violation of any 

regulation issued under the Act. OFAC prepenalty, penalty, and administrative 

collection procedures relating to such 

violations are set forth below in §§ 592.602 

through 592.604. Section 8(c) of the Act also 

authorizes the U.S. Bureau of Customs and 

Border Protection and U.S. Immigration and 

Customs Enforcement, as appropriate, to 

enforce the penalty provisions set forth in 

paragraph (a) of this section and to enforce 

the laws and regulations governing exports of 

rough diamonds, including with respect to 

the validation of the Kimberley Process 

Certificate by the U.S. Bureau of the Census. 

The Office of Foreign Assets Control (OFAC) 

civil penalty procedures set forth below are 

separate from, and independent of, any 

penalty procedures that may be followed by 

the U.S. Bureau of Customs and Border 

Protection and U.S. Immigration and 

Customs Enforcement in their exercise of the 

authorities set forth in section 8(c) of the Act. 

* * * * * 

(c) Pursuant to 18 U.S.C. 1001, 

whoever, in any matter within the 

jurisdiction of the executive, legislative, 

or judicial branch of the government of 

the United States, knowingly and 

willfully falsifies, conceals, or covers up 

by any trick, scheme, or device, a 

material fact, or makes any materially 

false, fictitious, or fraudulent statement 

or representation or makes or uses any 

false writing or document knowing the 

same to contain any materially false, 

fictitious, or fraudulent statement or 

entry shall be fined under title 18, 

United States Code, imprisoned, or 

both. 

(d) Violations of this part may also be 

subject to other applicable laws. 

■ 7. Revise § 592.602 to read as follows: 

§ 592.602 Pre-Penalty Notice; settlement. 

(a) When required. If OFAC has 

reason to believe that there has occurred 

a violation of any provision of this part 

or a violation of the provisions of any 

license, ruling, regulation, order, 

directive, or instruction issued by or 

pursuant to the direction or 

authorization of the Secretary of the 

Treasury pursuant to this part or 

otherwise under the Clean Diamond 

Trade Act, and determines that a civil 

monetary penalty is warranted, OFAC 

will issue a Pre-Penalty Notice 

informing the alleged violator of the 

agency’s intent to impose a monetary 

penalty. A Pre-Penalty Notice shall be in 

writing. The Pre-Penalty Notice may be 

issued whether or not another agency 

has taken any action with respect to the 

matter. For a description of the contents 

of a Pre-Penalty Notice, see appendix A 

to part 501 of this chapter. 

(b) Response—(1) Right to respond. 

An alleged violator has the right to 

respond to a Pre-Penalty Notice by 

making a written presentation to OFAC. 

For a description of the information that 

should be included in such a response, 

see appendix A to part 501 of this 

chapter. 

(2) Deadline for response. A response 

to a Pre-Penalty Notice must be made 

within 30 days as set forth in paragraphs 

(b)(2)(i) and (ii) of this section. The 

failure to submit a response within 30 

days shall be deemed to be a waiver of 

the right to respond. 

(i) Computation of time for response. 

A response to a Pre-Penalty Notice must 

be postmarked or date-stamped by the 

U.S. Postal Service (or foreign postal 

service, if mailed abroad) or courier 

service provider (if transmitted to OFAC 

by courier) on or before the 30th day 

after the postmark date on the envelope 

in which the Pre-Penalty Notice was 

mailed. If the Pre-Penalty Notice was 

personally delivered by a non-U.S. 

Postal Service agent authorized by 

OFAC, a response must be postmarked 


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or date-stamped on or before the 30th 

day after the date of delivery. 

(ii) Extensions of time for response. If 

a due date falls on a federal holiday or 

weekend, that due date is extended to 

include the following business day. Any 

other extensions of time will be granted, 

at the discretion of OFAC, only upon 

specific request to OFAC. 

(3) Form and method of response. A 

response to a Pre-Penalty Notice need 

not be in any particular form, but it 

must be typewritten and signed by the 

alleged violator or a representative 

thereof, contain information sufficient 

to indicate that it is in response to the 

Pre-Penalty Notice, and include the 

OFAC identification number listed on 

the Pre-Penalty Notice. A copy of the 

written response may be sent by 

facsimile, but the original also must be 

sent to OFAC’s Office of Compliance 

and Enforcement by mail or courier and 

must be postmarked or date-stamped in 

accordance with paragraph (b)(2) of this 

section. 

(c) Settlement. Settlement discussion 

may be initiated by OFAC, the alleged 

violator, or the alleged violator’s 

authorized representative. For a 

description of practices with respect to 

settlement, see appendix A to part 501 

of this chapter. 

(d) Guidelines. Guidelines for the 

imposition or settlement of civil 

penalties by OFAC are contained in 

appendix A to part 501 of this chapter. 

(e) Representation. A representative of 

the alleged violator may act on behalf of 

the alleged violator, but any oral 

communication with OFAC prior to a 

written submission regarding the 

specific allegations contained in the PrePenalty Notice must be preceded by a 

written letter of representation, unless 

the Pre-Penalty Notice was served upon 

the alleged violator in care of the 

representative. 

■ 8. Revise § 592.603 to read as follows: 

§ 592.603 Penalty imposition. 

If, after considering any written 

response to the Pre-Penalty Notice and 

any relevant facts, OFAC determines 

that there was a violation by the alleged 

violator named in the Pre-Penalty 

Notice and that a civil monetary penalty 

is appropriate, OFAC may issue a 

Penalty Notice to the violator containing 

a determination of the violation and the 

imposition of the monetary penalty. For 

additional details concerning issuance 

of a Penalty Notice, see appendix A to 

part 501 of this chapter. The issuance of 

the Penalty Notice shall constitute final 

agency action. The violator has the right 

to seek judicial review of that final 

agency action in federal district court. 

■ 9. Revise § 592.604 to read as follows: 

§ 592.604 Administrative collection; 

referral to United States Department of 

Justice. 

In the event that the violator does not 

pay the penalty imposed pursuant to 

this part or make payment arrangements 

acceptable to OFAC, the matter may be 

referred for administrative collection 

measures by the Department of the 

Treasury or to the United States 

Department of Justice for appropriate 

action to recover the penalty in a civil 

suit in a federal district court. 

■ 10. Revise § 592.605 to read as 

follows: 

§ 592.605 Finding of Violation. 

(a) When issued. (1) OFAC may issue 

an initial Finding of Violation that 

identifies a violation if OFAC: 

(i) Determines that there has occurred 

a violation of any provision of this part, 

or a violation of the provisions of any 

license, ruling, regulation, order, 

directive, or instruction issued by or 

pursuant to the direction or 

authorization of the Secretary of the 

Treasury pursuant to this part or 

otherwise under the Clean Diamond 

Trade Act; 

(ii) Considers it important to 

document the occurrence of a violation; 

and, 

(iii) Based on the Guidelines 

contained in appendix A to part 501 of 

this chapter, concludes that an 

administrative response is warranted 

but that a civil monetary penalty is not 

the most appropriate response. 

(2) An initial Finding of Violation 

shall be in writing and may be issued 

whether or not another agency has taken 

any action with respect to the matter. 

For additional details concerning 

issuance of a Finding of Violation, see 

appendix A to part 501 of this chapter. 

(b) Response—(1) Right to respond. 

An alleged violator has the right to 

contest an initial Finding of Violation 

by providing a written response to 

OFAC. 

(2) Deadline for response; default 

determination. A response to an initial 

Finding of Violation must be made 

within 30 days as set forth in paragraphs 

(b)(2)(i) and (ii) of this section. The 

failure to submit a response within 30 

days shall be deemed to be a waiver of 

the right to respond, and the initial 

Finding of Violation will become final 

and will constitute final agency action. 

The violator has the right to seek 

judicial review of that final agency 

action in federal district court. 

(i) Computation of time for response. 

A response to an initial Finding of 

Violation must be postmarked or datestamped by the U.S. Postal Service (or 

foreign postal service, if mailed abroad) 

or courier service provider (if 

transmitted to OFAC by courier) on or 

before the 30th day after the postmark 

date on the envelope in which the 

initial Finding of Violation was served. 

If the initial Finding of Violation was 

personally delivered by a non-U.S. 

Postal Service agent authorized by 

OFAC, a response must be postmarked 

or date-stamped on or before the 30th 

day after the date of delivery. 

(ii) Extensions of time for response. If 

a due date falls on a federal holiday or 

weekend, that due date is extended to 

include the following business day. Any 

other extensions of time will be granted, 

at the discretion of OFAC, only upon 

specific request to OFAC. 

(3) Form and method of response. A 

response to an initial Finding of 

Violation need not be in any particular 

form, but it must be typewritten and 

signed by the alleged violator or a 

representative thereof, contain 

information sufficient to indicate that it 

is in response to the initial Finding of 

Violation, and include the OFAC 

identification number listed on the 

initial Finding of Violation. A copy of 

the written response may be sent by 

facsimile, but the original also must be 

sent to OFAC by mail or courier and 

must be postmarked or date-stamped in 

accordance with paragraph (b)(2) of this 

section. 

(4) Information that should be 

included in response. Any response 

should set forth in detail why the 

alleged violator either believes that a 

violation of the regulations did not 

occur and/or why a Finding of Violation 

is otherwise unwarranted under the 

circumstances, with reference to the 

General Factors Affecting 

Administrative Action set forth in the 

Guidelines contained in appendix A to 

part 501. The response should include 

all documentary or other evidence 

available to the alleged violator that 

supports the arguments set forth in the 

response. OFAC will consider all 

relevant materials submitted in the 

response. 

(c) Determination—(1) Determination 

that a Finding of Violation is warranted. 

If, after considering the response, OFAC 

determines that a final Finding of 

Violation should be issued, OFAC will 

issue a final Finding of Violation that 

will inform the violator of its decision. 

A final Finding of Violation shall 

constitute final agency action. The 

violator has the right to seek judicial 

review of that final agency action in 

federal district court. 

(2) Determination that a Finding of 

Violation is not warranted. If, after 

considering the response, OFAC 

determines a Finding of Violation is not 


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Federal Register / Vol. 83, No. 118 / Tuesday, June 19, 2018 / Rules and Regulations 28375 

warranted, then OFAC will inform the 

alleged violator of its decision not to 

issue a final Finding of Violation. 

Note 1 to paragraph (c)(2): A 

determination by OFAC that a final Finding 

of Violation is not warranted does not 

preclude OFAC from pursuing other 

enforcement actions consistent with the 

Guidelines contained in appendix A to part 

501 of this chapter. 

(d) Representation. A representative of the 

alleged violator may act on behalf of the 

alleged violator, but any oral communication 

with OFAC prior to a written submission 

regarding the specific alleged violations 

contained in the initial Finding of Violation 

must be preceded by a written letter of 

representation, unless the initial Finding of 

Violation was served upon the alleged 

violator in care of the representative. 

Dated: June 12, 2018. 

Bradley T. Smith, 

Acting Deputy Director, Office of Foreign 

Assets Control. 

[FR Doc. 2018–12887 Filed 6–18–18; 8:45 am] 

BILLING CODE 4810–AL 

DEPARTMENT OF DEFENSE 

Department of the Navy 

32 CFR Part 706 

Certifications and Exemptions Under 

the International Regulations for 

Preventing Collisions at Sea, 1972 

AGENCY: Department of the Navy, DoD 

ACTION: Final rule. 

SUMMARY: The Department of the Navy 

(DoN) is amending its certifications and 

exemptions under the International 

Regulations for Preventing Collisions at 

Sea, 1972 (72 COLREGS), to reflect that 

the Deputy Assistant Judge Advocate 

General (DAJAG) (Admiralty and 

Maritime Law) has determined that 

certain vessels of the VIRGINIA SSN 

Class are vessels of the Navy which, due 

to their special construction and 

purpose, cannot fully comply with 

certain provisions of the 72 COLREGS 

without interfering with their special 

function as a naval ships. The intended 

effect of this rule is to warn mariners in 

waters where 72 COLREGS apply. 

DATES: This rule is effective June 19, 

2018 and is applicable beginning May 

29, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Lieutenant Commander Kyle Fralick, 

(Admiralty and Maritime Law), Office of 

the Judge Advocate General, Department 

of the Navy, 1322 Patterson Ave. SE, 

Suite 3000, Washington Navy Yard, DC 

20374–5066, telephone 202–685–5040. 

SUPPLEMENTARY INFORMATION: Pursuant 

to the authority granted in 33 U.S.C. 

1605, the DoN amends 32 CFR part 706. 

This amendment provides notice that 

the DAJAG (Admiralty and Maritime 

Law), under authority delegated by the 

Secretary of the Navy, has certified that 

certain vessels of the Virginia SSN Class 

are vessels of the Navy which, due to 

their special construction and purpose, 

cannot fully comply with the following 

specific provisions of 72 COLREGS 

without interfering with their special 

function as a naval ship: Rule 23(a) and 

Annex I, paragraph 2(a)(i), pertaining to 

the vertical placement of the masthead, 

light and Annex I, paragraph 2(f)(i), 

pertaining to the masthead light being 

above and clear of all other lights and 

obstructions; Rule 30 (a), Rule 21(e), and 

Annex I, paragraph 2(k), pertaining to 

the vertical separation of the anchor 

lights, vertical placement of the forward 

anchor light above the hull, and the arc 

of visibility of all around lights; Rule 23 

(a) and Annex I, paragraph 3(b), 

pertaining to the location of the 

sidelights; and Rule 21(c), pertaining to 

the location and arc of visibility of the 

sternlight. The DAJAG (Admiralty and 

Maritime Law) has also certified that the 

lights involved are located in closest 

possible compliance with the applicable 

72 COLREGS requirements. 

Moreover, it has been determined, in 

accordance with 32 CFR parts 296 and 

701, that publication of this amendment 

for public comment prior to adoption is 

impracticable, unnecessary, and 

contrary to public interest since it is 

based on technical findings that the 

placement of lights on these vessels in 

a manner differently from that 

prescribed herein will adversely affect 

these vessel’s ability to perform their 

military functions. 

List of Subjects in 32 CFR Part 706 

Marine safety, Navigation (water), 

Vessels. 

For the reasons set forth in the 

preamble, the DoN amends part 706 of 

title 32 of the Code of Federal 

Regulations as follows: 

PART 706—CERTIFICATIONS AND 

EXEMPTIONS UNDER THE 

INTERNATIONAL REGULATIONS FOR 

PREVENTING COLLISIONS AT SEA, 

1972 

■ 1. The authority citation for part 706 

continues to read as follows: 

Authority: 33 U.S.C. 1605. 

■ 2. Section 706.2 is amended by: 

■ a. In Table One, adding, in alpha 

numerical order, by vessel number, an 

entry for USS SOUTH DAKOTA (SSN 

790); 

■ b. In Table Three, adding, in alpha 

numerical order, by vessel number, an 

entry for USS SOUTH DAKOTA (SSN 

790); and 

■ c. In Table Four: 

■ i. In paragraph 25, by adding, in alpha 

numerical order, by vessel number, an 

entry for USS SOUTH DAKOTA (SSN 

790); and 

■ ii. In paragraph 26, by adding, in 

alpha numerical order, by vessel 

number, an entry for USS SOUTH 

DAKOTA (SSN 790). 

The additions read as follows: 

§ 706.2 Certifications of the Secretary of 

the Navy under Executive Order 11964 and 

33 U.S.C. 1605. 

* * * * * 

TABLE ONE

Vessel Number 

Distance in meters 

of forward masthead 

light below minimum 

required height. 

§ 2(a)(i) Annex I 

*******

USS SOUTH DAKOTA ....................................................... SSN 790 ............................................................................. 2.76 

* * * * * * * 

* * * * * 


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