This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

20136

Vol. 63, No. 78

Thursday, April 23, 1998

NUCLEAR REGULATORY

COMMISSION

10 CFR Part 50

RIN 3150–AF96

Codes and Standards: IEEE National

Consensus Standard

AGENCY: Nuclear Regulatory

Commission.

ACTION: Proposed rule.

SUMMARY: The Nuclear Regulatory

Commission (NRC) is proposing an

amendment to its regulations that would

incorporate by reference IEEE Std. 603–

1991, ‘‘Criteria for Safety Systems for

Nuclear Power Generating Stations,’’ a

national consensus standard for power,

instrumentation, and control portions of

safety systems in nuclear power plants.

This action is necessary to endorse the

latest version of this national consensus

standard in NRC’s regulations.

DATES: Comments on the proposed rule

must be received on or before May 26,

1998. Comments received after this date

will be considered if it is practical to

consider them, but the NRC is able to

ensure consideration only for comments

received on or before this date.

ADDRESSES: Mail comments to:

Secretary, U.S. Nuclear Regulatory

Commission, Washington, DC 20555–

0001; Attention: Rulemakings and

Adjudications Staff. Hand deliver

comments to 11555 Rockville Pike,

Rockville, Maryland, between 7:30 am

and 4:15 pm on Federal workdays.

Copies of any comments received may

be examined at the NRC Public

Document Room, 2120 L Street NW.

(Lower Level), Washington, D.C.

You may also submit comments via

the NRC’s interactive rulemaking web

site through the NRC Home Page (http:/

/www.nrc.gov). From the NRC home

page, select ‘‘Rulemaking’’ from the tool

bar. The interactive rulemaking website

can then be accessed by selecting ‘‘New

Rulemaking Website.’’ This site

provides the availability to upload

comments as files (any format), if your

web browser supports that function. For

information about the interactive

rulemaking web site, contact Ms. Carol

Gallagher at 301–415–5905 (e-mail:

cag@nrc.gov).

FOR FURTHER INFORMATION CONTACT:

Satish K. Aggarwal, Senior Program

Manager, U.S. Nuclear Regulatory

Commission, Washington, DC 20555–

0001; telephone 301–415–6005; Fax

301–415–5074; e-mail:ska@nrc.gov.

SUPPLEMENTARY INFORMATION:

Previous History

On October 17, 1997 (62 FR 53932),

NRC published a direct final rule in the

Federal Register that amended its

regulations to incorporate by reference

IEEE Std. 603–1991 for power,

instrumentation, and control portions of

safety systems in nuclear power plants.

The direct final rule was withdrawn on

December 23, 1997 (62 FR 66977),

because the NRC received significant

adverse comments in response to the

proposed rule that was issued as a

companion to the direct final rule on

October 17, 1997 (62 FR 53975). The

NRC has considered the comments it

received, revised the proposed rule, and

is reissuing a second proposed rule to

give the public another opportunity to

comment.

This proposed rule supersedes the

October 17, 1997, proposed rule.

Background

10 CFR Part 50, ‘‘Domestic Licensing

of Production and Utilization

Facilities,’’ § 50.55a (h) requires that the

protection systems in nuclear power

plants meet the requirements stated in

IEEE Std. 279, ‘‘Criteria for Protection

Systems for Nuclear Power Generating

Stations,’’ in effect on the formal docket

date of the application. However, IEEE

has withdrawn IEEE Std. 279–1971 and

it has now been superseded by IEEE Std.

603–1991, ‘‘Criteria for Safety Systems

for Nuclear Power Generating Stations.’’

In November 1995, the NRC staff

issued a draft regulatory guide for

public comment, DG–1042, which was a

proposed Revision 1 to Regulatory

Guide 1.153, ‘‘Criteria for Safety

Systems.’’ This draft regulatory guide

proposed to endorse IEEE Std. 603–1991

(including the correction sheet dated

January 30, 1995). There were no

adverse comments to DG–1042, and

Revision 1 to Regulatory Guide 1.153

was issued in June 1996, endorsing IEEE

Std. 603–1991. Because of the absence

of adverse public comments to Revision

1 to Regulatory Guide 1.153, the NRC

believed that there was general public

consensus that IEEE Std. 603–1991

provides acceptable criteria for safety

systems in nuclear power plants. For

this reason, the NRC published the

direct final rule without seeking public

comments on the amendment before

issuing it. In view of the significant

public comments received, the NRC has

reconsidered this action (See the

discussion under Previous History).

Discussion

This proposed rule would incorporate

a national consensus standard, IEEE Std.

603–1991, into NRC regulations to

establish minimal functional and design

requirements for power,

instrumentation, and control portions of

safety systems for nuclear power plants.

This action would be consistent with

the provisions of the National

Technology Transfer and Advancement

Act of 1995, Public Law 104–113, which

encourages Federal regulatory agencies

to consider adopting industry consensus

standards as an alternative to de novo

agency development of standards

affecting an industry. This action would

also be consistent with the NRC policy

of evaluating the latest versions of

national consensus standards in terms

of their suitability for endorsement by

regulations or regulatory guides.

Currently, 10 CFR 50.55a(h) specifies

that ‘‘protection systems’’ for plants

with construction permits issued after

January 1, 1971, must meet the

requirements in IEEE Std. 279 in effect

on the formal docket date of the

application for a construction permit.

IEEE Std. 279–1971 states that a

‘‘protection system’’ encompasses all

electric and mechanical devices and

circuitry (from sensors to actuation

device input terminals) involved in

generating those signals associated with

the protective function. These signals

include those that actuate reactor trip

and that, in the event of a serious

reactor accident, actuate engineered

safety features (ESFs), such as

containment isolation, core spray, safety

injection, pressure reduction, and air

cleaning. ‘‘Protective function’’ is

defined in IEEE Std. 279–1971 as ‘‘the

sensing of one or more variables

associated with a particular generating

station condition, signal processing, and
Federal Register / Vol. 63, No. 78 /Thursday, April 23, 1998 / Proposed Rules 20137

the initiation and completion of the

protective action at values of the

variables established in the design

bases.’’

IEEE Std. 603–1991 uses the term

‘‘safety systems’’ rather than ‘‘protection

systems.’’ A ‘‘safety system’’ is defined

in IEEE Std. 603–1991 as ‘‘a system that

is relied upon to remain functional

during and following design basis

events to ensure: (i) the integrity of the

reactor coolant pressure boundary, (ii)

the capability to shut down the reactor

and maintain it in a safe shutdown

condition, or (iii) the capability to

prevent or mitigate the consequences of

accidents that could result in potential

off-site exposures comparable to the 10

CFR Part 100 guidelines.’’ A ‘‘safety

function’’ is defined in IEEE Std. 603–

1991 as ‘‘one of the processes or

conditions (for example, emergency

negative reactivity insertion, postaccident heat removal, emergency core

cooling, post-accident radioactivity

removal, and containment isolation)

essential to maintain plant parameters

within acceptable limits established for

a design basis event.’’

The NRC recognizes that ‘‘protection

systems’’ are a subset of ‘‘safety

systems.’’ Safety system is a broad-based

and all-encompassing term, embracing

the protection system in addition to

other electrical systems. Thus, the term

‘‘protection system’’ is not synonymous

with the term ‘‘safety system.’’ The

proposed rule would not change the

scope of the systems covered in the final

safety analysis report (FSAR) for

currently operating nuclear power

plants, whether or not they intend to

make system-level replacements of

protection systems.

This proposed rule would mandate

the use of IEEE Std. 603–1991

(including the correction sheet dated

January 30, 1995) for safety systems for

future nuclear power plants, including

final design approvals, design

certifications, and combined licenses

under 10 CFR Part 52 . Current licensees

may continue to meet the requirements

stated in the edition or revision of IEEE

Std. 279 in effect on the formal date of

their application for a construction

permit or may, at their option, use IEEE

Std. 603–1991, provided they comply

with all applicable requirements for

making changes to their licensing basis.

However, system-level replacements of

protection systems and addition of new

safety systems in operating nuclear

power plants initiated on or after

January 1, 1999, would be required to

meet the requirements in IEEE Std. 603–

1991. A ‘‘system’’ is defined as a

combination of two or more interrelated

components that perform a specific

safety function. The protection systems

are listed in the plant’s FSAR. For

example, ‘‘neutron monitoring system’’

is a protection system. The upgrade of

the average power range monitor

(APRM) portion of the neutron

monitoring system to add the ability to

detect and suppress potential boilingwater reactor (BWR) instabilty may meet

IEEE Std. 279 because the modification

only replaces the APRM signal

processing components, output relays,

recirculation flow transmitters, and

operator displays. If this modification

were to replace the neutron detectors,

local power range monitor cards, and

associated power supplies, the

modification would be considered a

complete replacement at a system level

and must meet IEEE Std. 603–1991.

Similarly, the replacement of the source

range monitors and intermediate range

monitors in a BWR with wide-range

neutron monitors must meet IEEE Std.

603–1991, because it involves the

complete replacement of the system,

including sensors, preamps, signal

processors, output relays, and operator

displays. Reuse of a few existing

components (e.g., selected cables,

raceway, and control room panels where

the displays are mounted) as part of the

system-level replacement would still

place this type of modification in the

category of a complete system-level

replacement.

IEEE Std. 603–1991 references several

industry codes and standards. Unless

these referenced standards are

specifically incorporated by reference

elsewhere in the NRC regulations, they

do not represent the Commission’s

mandatory requirements. If the

referenced standard has been endorsed

in a regulatory guide, the standard

constitutes a method acceptable to the

NRC of meeting a regulatory

requirement as described in the

regulatory guide. If a referenced

standard has not been endorsed in a

regulatory guide, the licensees and

applicants may consider and use the

information in the referenced standard

in a manner that is consistent with

current regulatory practices.

Significant Comments on the Direct

Final Rule

The NRC received 28 letters from the

public by December 8, 1997,

commenting on the content of the direct

final rule. Copies of comment letters are

available for public inspection and

copying for a fee at the NRC’s Public

Document Room. The major issues

raised by the comments and the NRC

staff responses to these issues are as

follows:

(1) Referenced Standards.

Issue. There are approximately 100

‘‘shalls’’ in IEEE Std. 603–1991, which

refer to 13 other IEEE standards, 3 ANS/

ANSI standards, and 1 ISA standard.

This rule would require a full redesign

of the plant, if licensees are required to

comply with these referenced standards.

Response. Because the NRC did not

seek for any of the other standards

referenced in IEEE Std. 603–1991 to be

approved for incorporation by reference,

these standards are not mandatory

requirements, even though IEEE Std.

603–1991 invokes the referenced

standards by the use of ‘‘shall.’’

However, the NRC encourages licensees

to adopt these referenced standards

voluntarily because these newer

consensus standards reflect progress

and the current state of technology. If a

referenced standard has been endorsed

in a regulatory guide, the standard

constitutes a method acceptable to the

NRC for meeting a regulatory

requirement as described in the

regulatory guide. In many cases, the

regulatory guides endorse a previous

version of the IEEE standard. These

guides represent the current NRC

recommended practices. Licensees may

opt to use alternate approaches if they

can provide sufficient technical bases.

(2) Scope: Protection System vs.

Safety System.

Issue. The terms ‘‘protection systems’’

and ‘‘safety systems’’ are not

synonymous.

Response. The NRC staff agrees that

protection systems are a subset of safety

systems and thus, the terms are not

synonymous. The term protection

system is defined in IEEE Std. 279–1971

(and in IEEE Std. 603–1991), and the

term safety system is defined in IEEE

Std. 603–1991. The NRC staff endorses

these definitions. The protection system

has a limited application; safety system

is broad based and all-encompassing,

thereby embracing the protection system

and other electrical systems. This

proposed rule would not change the

applicable scope of the systems for

operating nuclear power plants.

(3) Applicability of Rule.

Issue. The rule does not explicitly

state that it does not apply to nuclear

power plants with construction permits

issued before January 1, 1971.

Response. Nuclear power plants that

have not been required to meet IEEE

Std. 279–1971, because their

construction permit was issued before

January 1, 1971, may continue to make

modifications or changes to components

and subsystems, consistent with their

licensing basis and commitments made

to the NRC, or may meet the

requirements stated in IEEE Std. 603–

1991. However, the proposed rule
20138 Federal Register / Vol. 63, No. 78 /Thursday, April 23, 1998 / Proposed Rules

would mandate the use of IEEE Std.

603–1991 for system-level replacements

of protection systems and for the

addition of new safety systems.

(4) Changes: Components vs System

Level.

Issue. The rule would result in a dual

licensing basis within a system and

would introduce significant confusion,

because IEEE Std. 603–1991 was written

as a system standard. Replacements of

components or subsystems should not

be covered by the rule.

Response. The proposed rule would

not result in a dual licensing basis

within a system, because it would apply

only to system-level replacements of

protection systems and the addition of

new safety systems. Modifications or

changes to components and subsystems

shall meet the current requirements of

IEEE Std. 279, when applicable, but

need not meet the requirements of IEEE

Std. 603–1991.

Finding of No Environmental Impact:

Availability of Environmental

Assessment

The NRC has determined under the

National Environmental Policy Act of

1969, as amended, and the NRC’s

regulations in subpart A of 10 CFR Part

51, that because this proposed rule

would not be a major Federal action

significantly affecting the quality of the

human environment, an environmental

impact statement is not required. The

NRC has prepared an environmental

assessment supporting this finding of no

significant environmental impact.

The NRC has sent a copy of the

environmental assessment and a copy of

the Federal Register notice to every

State liaison officer and requested their

comments on the environmental

assessment. The environmental

assessment is available for inspection at

the NRC Public Document Room, 2120

L Street, NW., Washington, D.C. Also,

the NRC has committed itself to

complying in all its actions with

Presidential Executive Order 12898,

‘‘Federal Actions To Address

Environmental Justice in Minority

Populations and Low-Income

Populations’’ (February 11, 1994).

Therefore, the NRC also has determined

that there are no disproportionate, high,

and adverse impacts on minority and

low-income populations. The NRC uses

the following working definition of

environmental justice: Environmental

justice means the fair treatment and

meaningful involvement of all people—

regardless of race, ethnicity, culture,

income, or educational level—with

respect to the development,

implementation, and enforcement of

environmental laws, regulations, and

policies.

Paperwork Reduction Act Statement

This proposed rule does not contain

a new or amended information

collection requirement subject to the

Paperwork Reduction Act of 1995 (44

U.S.C. 3501, et seq.). Existing

requirements were approved by the

Office of Management and Budget,

Approval No. 3150–0011.

Public Protection Notification

If an information collection does not

display a currently valid OMB control

number, the NRC may not conduct or

sponsor, and a person is not required to

respond to, the information collection.

Regulatory Analysis

The NRC has prepared a regulatory

analysis that shows the proposed

amendment does not impose any new

requirements or costs on current

licensees who do not make changes to

protection systems. However, licensees

planning or proposing system-level

replacements of protection systems will

be affected because they will be

required to meet the requirements of

IEEE Std. 603–1991 for system level

replacements. This impact would be

minimal. Most changes to protection

systems only change a part of the

system, and IEEE Std. 279–1971 will

continue to apply. The draft regulatory

analysis is available for inspection in

the NRC Public Document Room, 2120

L Street NW., Washington, DC.

Regulatory Flexibility Certification

As required by the Regulatory

Flexibility Act of 1980 (5 U.S.C. 605

(b)), the NRC certifies that this rule, if

adopted, would not have a significant

economic impact on small entities. This

rule affects only the operation of nuclear

power plants. The companies that own

these plants do not fall within the scope

of the definition of ‘‘small entities’’

stated in the Regulatory Flexibility Act

or the small business size standards

adopted by the NRC (10 CFR 2.810).

Because these companies are dominant

in their service areas, this rule does not

fall within the purview of the act.

Backfit Analysis

The proposed rule would require

applicants and holders of new

construction permits, new operating

licenses, new final design certifications,

and combined licenses to comply with

IEEE Std. 603–1991 (including the

correction sheet dated January 30,

1995). System-level replacements to

protection systems in existing operating

plants initiated on or after January 1,

1999, would be required to meet the

requirements of IEEE Std. 603–1991.

IEEE Std. 279 will continue to apply to

those nuclear power plants required to

meet IEEE Std. 279 that do not make

system-level replacements of protection

systems, but the rule permits the

licensee the option of meeting IEEE Std.

603–1991.

The backfit rule was not intended to

apply to regulatory actions that change

expectations of prospective applicants

and, therefore, the backfit rule does not

apply to the portion of the rule

applicable to new construction permits,

new operating licenses, new final design

approvals, new design certifications,

and combined licenses. This proposed

rule would not change the licensing

basis (i.e., IEEE Std. 279) for plants that

do not intend to make any changes to

their power and instrumentation and

control systems. However, the proposed

rule would require future system-level

replacements of existing power and

instrumentation and control portions of

protection systems to comply with the

new standard. This would not be

considered a backfit, because the

changes are voluntarily initiated by the

licensee, or separately imposed by the

NRC after a separate backfit analysis.

This is consistent with past NRC

practice and the discussions on

backfitting in the Value-Impact

Statement prepared for Revision 1 to

Regulatory Guide 1.153. A copy of the

Value-Impact Statement is available for

inspection or copying for a fee in the

NRC’s Public Document Room at 2120

L Street, NW., Washington, DC, under

Task DG–1042.

In summary, the NRC has determined

that the backfit rule, 10 CFR 50.109,

does not apply to this rule because it

does not impose any backfits as defined

in 10 CFR 50.109(a)(1) and, therefore, a

backfit analysis has not been prepared

for this proposed rule.

List of Subjects in 10 CFR Part 50

Antitrust, Classified information,

Criminal penalties, Fire protection,

Incorporation by reference,

Intergovernmental relations, Nuclear

power plants and reactors, Radiation

protection, Reactor siting criteria, and

Reporting and recordkeeping

requirements.

For the reasons stated in the preamble

and under the authority of the Atomic

Energy Act of 1954, as amended, the

Energy Reorganization Act of 1974, as

amended, the Energy Reorganization

Act of 1974, as amended, and 5 U.S.C.,

the NRC is proposing to adopt the

following amendment to 10 CFR Part 50.
Federal Register / Vol. 63, No. 78 /Thursday, April 23, 1998 / Proposed Rules 20139

PART 50—DOMESTIC LICENSING OF

PRODUCTION AND UTILIZATION

FACILITIES

1. The authority citation for Part 50

continues to read as follows:

Authority: Secs. 102, 103, 104, 105, 161,

182, 183, 186, 189, 68 Stat. 936, 937, 938,

948, 953, 954, 955, 956, as amended, sec.

234, 83 Stat. 1244, as amended (42 U.S.C.

2132, 2133, 2134, 2135, 2201, 2232, 2233,

2236, 2239, 2282); secs. 201, as amended,

202, 206, 88 Stat. 1242, as amended, 1244,

1246 (42 U.S.C. 5841, 5842, 5846).

Section 50.7 also issued under Pub. L. 95–

601, sec. 10, 92 Stat. 2951 (42 U.S.C. 5851).

Section 50.10 also issued under secs. 101,

185, 68 Stat. 955 as amended (42 U.S.C. 2131,

2235), sec. 102, Pub. L. 91–190, 83 Stat. 853

(42 U.S.C. 4332). Sections 50.13, and 50.54

(dd), and 50.103 also issued under sec. 108,

68 Stat. 939, as amended (42 U.S.C. 2138),

Sections 50.23, 50.35, 50.55, and 50.56 also

issued under sec. 185, 68 Stat. 955 (42 U.S.C.

2235), Sections 50.33a, 50.55a and Appendix

Q also issued under sec. 102, Pub. L. 91–190,

83 Stat. 853 (42 U.S.C. 4332). Sections 50.34

and 50.54 also issued under sec. 204, 88 Stat.

1245 (42 U.S.C. 5844). Sections 50.58, 50.91,

and 50.92 also issued under Pub. L. 97–415,

96 Stat. 2073 (42 U.S.C. 2239). Section 50.78

also issued under sec. 122, 68 Stat. 939 (42

U.S.C. 2152). Sections 50.80–50.81 also

issued under sec. 184, 68 Stat. 954, as

amended (42 U.S.C. 2234). Appendix F also

issued under sec. 187, 68 Stat. 955 (42 U.S.C.

2237).

2. In § 50.55a, paragraph (h) is revised

to read as follows:

§ 50.55a Codes and standards.

* * * * *

(h) Protection and safety systems. (1)

IEEE Std. 603–1991, including the

correction sheet dated January 30, 1995,

which are referenced in paragraphs

(h)(2) and (h)(3) of this section, is

approved for incorporation by reference

by the Director of the Office of the

Federal Register in accordance with 5

U.S.C. 552(a) and 1 CFR Part 51. A

notice of any changes made to the

material incorporated by reference will

be published in the Federal Register.

Copies of IEEE Std. 603–1991 may be

purchased from the Institute of

Electrical and Electronics Engineers

Service Center, 445 Hoes Lane,

Piscataway, NJ 08855. The standard is

also available for inspection at the NRC

Library, 11545 Rockville Pike,

Rockville, MD; and at the Office of the

Federal Register, 800 North Capitol

Street, NW., Suite 700, Washington,

D.C. IEEE Std. 279, which is referenced

in paragraph (h)(2) of this section, was

approved for incorporation by reference

by the Director of the Office of the

Federal Register in accordance with 5

U.S.C. 552(a) and 1 CFR Part 51. Copies

of this standard are also available as

indicated for IEEE Std. 603–1991.

(2) Protection systems. For nuclear

power plants with construction permits

issued after January 1, 1971, but before

January 1, 1999, protection systems

must meet the requirements stated in

either IEEE Std. 279, ‘‘Criteria for

Protection Systems for Nuclear Power

Generating Stations,’’ or in IEEE Std.

603–1991, ‘‘Criteria for Safety Systems

for Nuclear Power Generating Stations,’’

and the correction sheet dated January

30, 1995. For nuclear power plants with

construction permits issued before

January 1, 1971, protection systems

must meet the requirements stated in

IEEE Std. 603–1991 or be consistent

with their licensing basis. System-level

replacement of protection systems and

addition of new safety systems in

existing operating nuclear power plants

initiated on or after January 1, 1999,

must meet the requirements stated in

IEEE Std. 603–1991 and the correction

sheet dated January 30, 1995.

(3) Safety systems. For construction

permits, operating licenses, final design

approvals, design certifications, and

combined licenses issued on or after

January 1, 1999, safety systems must

meet the requirements stated in IEEE

Std. 603–1991 and the correction sheet

dated January 30, 1995.

Dated at Rockville, Maryland, this 17th day

of April, 1998.

For the Nuclear Regulatory Commission.

John C. Hoyle,

Secretary of the Commission.

[FR Doc. 98–10842 Filed 4–22–98; 8:45 am]

BILLING CODE 7590–01–P

SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

Small Business Size Standards;

Waiver of the Nonmanufacturer Rule

AGENCY: Small Business Administration.

ACTION: Notice of intent to waive the

Nonmanufacturer Rule for towers,

telephone and telegraph apparatus,

electrical measuring and integrating

instruments, engines and turbines,

storage batteries, cellular handsets and

telephones, automobile motor vehicles,

motor trucks (except off-highway), fuel,

radiotelephones, and fiber optic cable.

SUMMARY: The Small Business

Administration (SBA) is considering

granting a waiver of the

Nonmanufacturer Rule for towers,

telephone and telegraph apparatus,

electrical measuring and integrating

instruments, engines and turbines,

storage batteries, cellular handsets and

telephones, automobile motor vehicles,

motor trucks (except off-highway), fuel,

radiotelephones, and fiber optic cable.

The basis for a waiver of the

Nonmanufacturer Rule for these

products is that there are no small

business manufacturers or processors

available to supply these products to the

Federal Government. The effect of a

waiver would be to allow an otherwise

qualified Nonmanufacturer to supply

other than the product of a domestic

small business manufacturer or

processor on a Federal contract set aside

for small businesses or awarded through

the SBA 8(a) Program. The purpose of

this notice is to solicit comments and

potential source information from

interested parties.

DATES: Comments and sources must be

submitted on or before May 14, 1998.

ADDRESSES: David Wm. Loines,

Procurement Analyst, U.S. Small

Business Administration, 409 3rd Street

S.W., Washington, DC 20416, Tel: (202)

205–6475.

SUPPLEMENTARY INFORMATION: Public law

100–656, enacted on November 15,

1988, incorporated into the Small

Business Act the previously existing

regulation that recipients of Federal

contracts set-aside for small businesses

or the SBA 8(a) Program procurement

must provide the product of a small

business manufacturer or processor, if

the recipient is other than the actual

manufacturer or processor. This

requirement is commonly referred to as

the Nonmanufacturer Rule. The SBA

regulations imposing this requirement

are found at 13 CFR 121.406(b). Section

303(h) of the law provides for waiver of

this requirement by SBA for any ‘‘class

of products’’ for which there are no

small business manufacturers or

processors in the Federal market. To be

considered available to participate in

the Federal market on these classes of

products, a small business manufacturer

must have submitted a proposal for a

contract solicitation or received a

contract from the Federal Government

within the last 24 months. The SBA

defines ‘‘class of products’’ based on

two coding systems. The first is the

Office of Management and Budget

Standard Industrial Classification

Manual (SIC). The second is the Product

and Service Code (PSC) established by

the Federal Procurement Data System.

The Small Business Administration is

currently processing a request for a

waiver of the Nonmanufacturer Rule for

Electrical Measuring and Integrating

Instruments (SIC 3825 PSC 5805),

Storage Batteries (SIC 3691), Fiber Optic

Cable (SIC 3357 PSC 6015), Engines and

Turbines (SIC 3511,3519 PSC 2835),

Automobile Motor Vehicles and Motor

Trucks (SIC 3711 PSC 2310 2320), Fuel