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[Federal Register Volume 78, Number 140 (Monday, July 22, 2013)]
[Rules and Regulations]
[Pages 43797-43810]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-17569]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 82

[EPA-HQ-OAR-2010-0280; FRL-9809-7]
RIN 2060-AR41

Protection of Stratospheric Ozone: The 2013 Critical Use 
Exemption From the Phaseout of Methyl Bromide

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is authorizing uses that qualify for the 2013 critical use 
exemption (CUE) and specifying the amount of methyl bromide that may be 
produced or imported for those uses. EPA is also amending the 
regulatory framework to remove certain requirements related to sale of 
pre-phaseout inventory for critical uses. EPA is taking this action 
under the authority of the Clean Air Act to reflect a consensus 
decision taken by the Parties to the Montreal Protocol on Substances 
that Deplete the Ozone Layer at the Twenty-Third Meeting of the 
Parties.

DATES: This rule is effective on July 22, 2013.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-OAR-2010-0280. All documents in the docket are listed on the 
www.regulations.gov Web site. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and is publicly 
available only in hard copy form. Publicly available docket materials 
are available either electronically through www.regulations.gov or in 
hard copy at the Air and Radiation Docket, EPA/DC, EPA West, Room 3334, 
1301 Constitution Ave. NW., Washington, DC. The Public Reading Room is 
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding 
legal holidays. The telephone number for the Public Reading Room is 
(202) 566-1744, and the telephone number for the Air and Radiation 
Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: For further information about this 
rule, contact Jeremy Arling by telephone at (202) 343-9055, or by email 
at arling.jeremy@epa.gov or by mail at U.S. Environmental Protection 
Agency, Stratospheric Protection Division, Stratospheric Program 
Implementation Branch (6205J), 1200 Pennsylvania Avenue NW., 
Washington, DC 20460. You may also visit the methyl bromide section of 
the Ozone Depletion Web site of EPA's Stratospheric Protection Division 
at www.epa.gov/ozone/mbr for further information about the methyl 
bromide critical use exemption, other Stratospheric Ozone Protection 
regulations, the science of ozone layer depletion, and related topics.

SUPPLEMENTARY INFORMATION: This rule concerns Clean Air Act (CAA) 
restrictions on the consumption, production, and use of methyl bromide 
(a Class I, Group VI controlled substance) for critical uses during 
calendar year 2013. Under the Clean Air Act, methyl bromide consumption 
(consumption is defined under section 601 of the CAA as production plus 
imports minus exports) and production were phased out on January 1, 
2005, apart from allowable exemptions, such as the critical use and the 
quarantine and preshipment (QPS) exemptions. With this action, EPA is 
authorizing uses that qualify for the 2013 critical use exemption as 
well as specific amounts of methyl bromide that may be produced and 
imported for critical uses in 2013.
    Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C. 
Chapter 5, generally provides that rules may not take effect earlier 
than 30 days after they are published in the Federal Register. EPA is 
issuing this final rule under section 307(d)(1) of the Clean Air Act, 
which states: ``The provisions of section 553 through 557 . . . of 
Title 5 shall not, except as expressly provided in this section, apply 
to actions to which this subsection applies.'' Thus, section 553(d) of 
the APA does not apply to this rule. EPA is nevertheless acting 
consistently with the policies underlying APA section 553(d) in making 
this rule effective on July 22, 2013. APA section 553(d) allows an 
effective date less than 30 days after publication for a rule that 
``that grants or recognizes an exemption or relieves a restriction.'' 5 
U.S.C. 553(d)(1). Since today's action can be considered to either 
grant an exemption for limited critical uses during 2013 from the 
general prohibition on production or import of methyl bromide after the 
phaseout date of January 1, 2005, or relieve a restriction that would 
otherwise prevent production or import of methyl bromide or sale of 
pre-phaseout inventory for critical uses, EPA is making this action 
effective immediately upon publication.

Table of Contents

I. General Information
    A. Regulated Entities
II. What is the critical use exemption process?
    A. Background of the Process
    B. How does this rule relate to previous critical use exemption 
rules?
    C. Critical Uses
    D. Critical Use Amounts
    E. Critical Stock Allowances
    1. Determining the Level of Available Stocks
    2. Amending the Critical Stock Allowances Framework
    F. The Criteria in Decisions IX/6 and Ex. I/4

[[Page 43798]]

    G. Emissions Minimization
III. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions that Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act

I. General Information

A. Regulated Entities

    Entities and categories of entities potentially regulated by this 
action include producers, importers, and exporters of methyl bromide; 
applicators and distributors of methyl bromide; and users of methyl 
bromide that applied for the 2013 critical use exemption including 
growers of vegetable crops, fruits, and nursery stock, and owners of 
stored food commodities and structures such as grain mills and 
processors. This list is not intended to be exhaustive, but rather to 
provide a guide for readers regarding entities likely to be regulated 
by this action. To determine whether your facility, company, business, 
or organization could be regulated by this action, you should carefully 
examine the regulations promulgated at 40 CFR part 82, subpart A. If 
you have questions regarding the applicability of this action to a 
particular entity, consult the person listed in the preceding section.

II. What is the critical use exemption process?

A. Background of the Process

    Article 2H of the Montreal Protocol established the critical use 
exemption provision. At the Ninth Meeting of the Parties in 1997, the 
Parties established the criteria for an exemption in Decision IX/6. In 
that Decision, the Parties agreed that ``a use of methyl bromide should 
qualify as `critical' only if the nominating Party determines that: (i) 
The specific use is critical because the lack of availability of methyl 
bromide for that use would result in a significant market disruption; 
and (ii) there are no technically and economically feasible 
alternatives or substitutes available to the user that are acceptable 
from the standpoint of environment and public health and are suitable 
to the crops and circumstances of the nomination.'' EPA promulgated 
these criteria in the definition of ``critical use'' at 40 CFR 82.3. 
EPA recognizes that as the market for alternatives evolves, the 
thresholds for what constitutes ``significant market disruption'' or 
``technical and economic feasibility'' may change. Such information has 
the potential to alter the technical or economic feasibility of an 
alternative and could thus cause EPA to modify the analysis that 
underpins EPA's determination as to which uses and what amounts of 
methyl bromide qualify for the CUE.
    In addition, the Parties decided that production and consumption, 
if any, of methyl bromide for critical uses should be permitted only if 
a variety of conditions have been met, including that all technically 
and economically feasible steps have been taken to minimize the 
critical use and any associated emission of methyl bromide, that 
research programs are in place to develop and deploy alternatives and 
substitutes, and that methyl bromide is not available in sufficient 
quantity and quality from existing stocks of banked or recycled methyl 
bromide.
    In response to EPA's request for critical use exemption 
applications published in the Federal Register on July 15, 2010 (75 FR 
41177), applicants provided data on the technical and economic 
feasibility of using alternatives to methyl bromide. Applicants also 
submitted data on their use of methyl bromide, ongoing research 
programs into the use of alternatives to methyl bromide in their 
sector, and efforts to minimize use and emissions of methyl bromide.
    EPA reviews the data submitted by applicants, as well as data from 
governmental and academic sources, to establish whether there are 
technically and economically feasible alternatives available for a 
particular use of methyl bromide, and whether there would be a 
significant market disruption if no exemption were available. In 
addition, an interagency workgroup reviews other parameters of the 
exemption applications such as dosage and emissions minimization 
techniques and applicants' research or transition plans. This 
assessment process culminates in the development of the U.S. critical 
use nomination (CUN). Annually since 2003, the U.S. Department of State 
has submitted a CUN to the United Nations Environment Programme (UNEP) 
Ozone Secretariat. The Methyl Bromide Technical Options Committee 
(MBTOC) and the Technology and Economic Assessment Panel (TEAP), which 
are advisory bodies to Parties to the Montreal Protocol, review each 
Party's CUN and make recommendations to the Parties on the nominations. 
The Parties then make Decisions on the authorization of critical use 
exemptions for particular Parties, including how much methyl bromide 
may be supplied for the exempted critical uses. As required in section 
604(d)(6) of the CAA, for each exemption period, EPA consults with the 
United States Department of Agriculture (USDA) and other departments 
and institutions of the Federal government that have regulatory 
authority related to methyl bromide, and provides an opportunity for 
public comment on the amounts and specific uses of methyl bromide that 
the agency is proposing to exempt.
    On February 4, 2011, the U.S. Government (USG) submitted the ninth 
Nomination for a Critical Use Exemption for Methyl Bromide for the 
United States of America to the Ozone Secretariat of UNEP. This 
nomination contained the request for 2013 critical uses. In February 
2011, MBTOC sent questions to the USG concerning technical and economic 
issues in the 2013 nomination. The USG transmitted responses to MBTOC 
in February, 2011. These documents, together with reports by the 
advisory bodies noted above, are in the public docket for this 
rulemaking. The critical uses and amounts in this final rule reflect 
the analysis contained in those documents.

B. How Does this rule relate to previous critical use exemption rules?

    The December 23, 2004, Framework Rule established the framework for 
the critical use exemption program in the United States, including 
definitions, prohibitions, trading provisions, and recordkeeping and 
reporting obligations. The preamble to the Framework Rule included 
EPA's determinations on key issues for the critical use exemption 
program.
    Since publishing the Framework Rule, EPA has annually promulgated 
regulations to exempt specific quantities of production and import of 
methyl bromide, to determine the amounts that may be supplied from pre-
phaseout inventory, and to indicate which uses meet the criteria for 
the exemption program for that year. See 71 FR 5985 (February 6, 2006), 
71 FR 75386 (December 14, 2006), 72 FR 74118 (December 28, 2007), 74 FR 
19878 (April 30, 2009), 75 FR 23167 (May 3, 2010), 76 FR 60737 
(September 30, 2011), and 77 FR 29218 (May 17, 2012).

[[Page 43799]]

    Today's action changes the EPA's approach for determining the 
amounts of Critical Use Allowances (CUAs) to be allocated for critical 
uses in 2013. A CUA is the privilege granted through 40 CFR part 82 to 
produce or import 1 kg of methyl bromide for an approved critical use 
during the specified control period. A control period is a calendar 
year. See 40 CFR 82.3. The control period at issue in this rule is 
2013. These allowances expire at the end of the control period and, as 
explained in the Framework Rule, are not bankable from one year to the 
next. The CUA allocation is subject to the trading provisions at 40 CFR 
82.12, which are discussed in section V.G. of the preamble to the 
Framework Rule.
    Today's action also removes from the regulatory framework the 
restriction that limits the sale of inventory to critical uses through 
allocations of Critical Stock Allowances (CSA). A CSA was the right 
granted through 40 CFR part 82 to sell 1 kg of methyl bromide from 
inventory produced or imported prior to the January 1, 2005, phaseout 
date for an approved critical use during the specified control period. 
The Framework Rule established provisions governing the sale of pre-
phaseout inventories for critical uses, including a prohibition on the 
sale of pre-phaseout inventories for critical uses in excess of the 
amount of CSAs held by the seller. The removal of this prohibition is 
discussed in more detail below.

C. Critical Uses

    Today's action amends the table in 40 CFR part 82, subpart A, 
appendix L to reflect the agreed critical use categories identified in 
Decision XXIII/4. In that Decision, taken in November 2011, the Parties 
to the Protocol agreed ``to permit, for the agreed critical-use 
categories for 2013 set forth in table A of the annex to the present 
decision for each party, subject to the conditions set forth in the 
present decision and in decision Ex.I/4 to the extent that those 
conditions are applicable, the levels of production and consumption for 
2013 set forth in table B of the annex to the present decision which 
are necessary to satisfy critical uses . . .'' The following uses are 
those set forth in table A of the annex to Decision XXIII/4 for the 
United States:
 Commodities
 Mills and food processing structures
 Dried cured pork
 Cucurbits
 Eggplant--field
 Nursery stock--fruit, nuts, flowers
 Orchard replants
 Ornamentals
 Peppers--field
 Strawberry--field
 Strawberry runners
 Tomatoes--field
    EPA sought comment on the technical analysis contained in the U.S. 
nomination (available for public review in the docket), and information 
regarding any changes to the registration (including cancellations or 
registrations), use, or efficacy of alternatives that have occurred 
after the 2013 U.S. CUN was forwarded.
    EPA received two comments about the critical use nomination 
process. One commenter stated that the process should be based in sound 
science, and be transparent, fair and objective. The nomination process 
should meet the critical need for methyl bromide from the industries 
and individuals that apply. The second commenter stated there is no 
meaningful opportunity for an applicant that is not included in the CUN 
to object or challenge the CUN.
    EPA agrees with the comment that the nomination process should be 
based in sound science and meet the critical needs of the applicants. 
EPA also strives to make the process transparent, fair, and objective. 
EPA conducts a rigorous technical assessment of the applications and 
evaluates data and current research to establish an internationally 
defensible basis for the nominations. In doing so the agency works with 
the State Department, USDA, state pesticide agencies, researchers, 
fumigators and applicants to assess whether there are technically or 
economically feasible alternatives, and whether a significant market 
disruption would result from the lack of a CUE.
    The U.S. CUN is submitted on behalf of the U.S. government by the 
Department of State to the Parties to the Montreal Protocol. The 
Department of State has an extensive stakeholder engagement process to 
solicit input on the U.S. CUN. Private parties are encouraged to 
participate in that process. In the most recent round, EPA has worked 
to further improve the transparency of the nomination process by 
collaborating more closely with the applicants than in previous years. 
Shortly after receiving the applications, EPA informed the applicants 
of any obvious data gaps and scheduled meetings to discuss the needed 
information. In some instances, EPA followed up with additional calls 
and meetings. As a result of this technical review, EPA may determine 
that an applicant has not sufficiently shown that the regulatory and 
Montreal Protocol criteria for a critical use are met. After submitting 
the 2015 nomination, EPA held calls with all the applicants to discuss 
the technical basis for the nomination and to show how future 
applications can be strengthened. EPA has posted on its Web site, and 
added to the docket, a schedule detailing upcoming deadlines and past 
interactions with applicants.
    In addition, EPA received comment that the agency should clarify 
what constitutes a significant market disruption since the commenter 
considers the term to be vague and subject to various interpretations 
by EPA. The term ``significant market disruption'' is left to the 
discretion of each Party to the Protocol to interpret. The agency has 
previously provided its interpretation of the term, and EPA refers 
readers to the preamble for the 2006 CUE rule (71 FR 5989, February 6, 
2006) as well as to the memo in the docket titled ``Development of 2003 
Nomination for a Critical Use Exemption for Methyl Bromide for the 
United States of America'' for further elaboration. As explained in 
greater detail in those documents, EPA's interpretation of this term 
has several dimensions, including looking at potential effects on both 
demand and supply for a commodity, evaluating potential losses at both 
an individual level and at an aggregate level, and evaluating potential 
losses in both relative and absolute terms.
    EPA received comment that all of the uses contained in the 
nomination be authorized as critical uses for 2013. EPA agrees and is 
not removing any uses, commodities or otherwise, that were nominated 
and approved by the Parties for use in 2013. EPA did not receive any 
data that would support removing uses that were nominated and approved 
by the Parties. EPA received one comment that there should be no uses 
of methyl bromide given its effect on the stratospheric ozone layer, 
and one comment that CUE authorization should not impede the adoption 
of alternatives. EPA disagrees that all methyl bromide use should stop 
and does not believe that the CUE authorization for 2013 will impede 
the continued adoption of methyl bromide alternatives. The CUN 
addresses the need for methyl bromide for the 2013 critical uses, 
which, as described in the nomination chapters found in the docket, are 
uses for which EPA has found there are not technically and economically 
feasible alternatives. In addition, the 2013 critical uses were 
reviewed by the technical bodies to the Ozone Secretariat and 
authorized by the Parties to the Montreal Protocol.
    EPA also received a comment that the agency should reopen the 
nominations for 2013 to account for the withdrawal of iodomethane from 
the U.S. market, especially if the availability of

[[Page 43800]]

iodomethane was the reason the USG did not nominate certain sectors. At 
this point it is not possible for the USG to reopen nominations for 
2013. As described in the previous section, in order to provide time 
for EPA to promulgate a rule authorizing critical use exemptions for a 
particular control period, the USG submits a nomination the January two 
years prior to the control period at issue. In addition, if the USG had 
submitted a supplemental request for 2013 this January, the Parties 
would not have been able to consider it until November of 2013, which 
would not provide relief to growers.
    EPA is finalizing the lists of approved critical uses and approved 
critical users as proposed. First, as discussed in the proposal, EPA is 
removing from Appendix L two users that did not submit applications and 
therefore were not included in the U.S. nomination. These users are 
California rose nursery growers and Maryland tomato growers. Second, 
EPA is removing the National Pest Management Association (NPMA) food 
processing as an approved critical user. The NPMA did not initially 
apply to be a critical user in 2013 and the Parties have not authorized 
a critical use for NPMA for 2013.
    Members of the NPMA have worked to transition from methyl bromide 
to alternative practices and alternative fumigants like sulfuryl 
fluoride. In January 2004, EPA registered the first food uses of 
sulfuryl fluoride for control of insect pests in grain processing 
facilities and in harvested and processed food commodities such as 
cereal grains, dried fruits, and tree nuts. In July 2005, EPA approved 
sulfuryl fluoride for treatment of additional harvested and processed 
food commodities such as coffee and cocoa beans, and for fumigation of 
food handling and processing facilities.
    On January 19, 2011, EPA proposed to revoke the residue limits on 
food, known as tolerances, for fluoride on the food commodities 
approved for treatment with sulfuryl fluoride (76 FR 3422). In response 
to this proposal, the NPMA submitted a supplemental request for 2013 
methyl bromide use during the open period for 2014 applications. The 
USG did not include NPMA's supplemental request in the 2014 nomination 
submitted to UNEP on January 31, 2012, because EPA has only proposed to 
revoke the tolerances for sulfuryl fluoride and has not taken action in 
any final rule. U.S. critical use nominations are based on final 
decisions about alternatives. Additionally, the proposed tolerance 
revocation included a staggered implementation scheme, making it 
unlikely that any specific revocation will be effective in 2013. 
Therefore, EPA is not finalizing NPMA as an approved critical user in 
2013.
    Third, EPA is removing sectors or users that applied for a critical 
use in 2013 but that the United States did not nominate for 2013. EPA 
conducted a thorough technical assessment of each application and 
considered the effects that the loss of methyl bromide would have for 
each agricultural sector, and whether significant market disruption 
would occur as a result. As a result of this technical review, the USG 
determined that certain sectors or users did not meet the critical use 
criteria in Decision IX/6, and the USG therefore did not include them 
in the 2013 Critical Use Nomination. EPA notified these sectors of 
their status in July 2011, and those letters are in the public docket 
for this rule. These sectors are: members of the Southeastern Cucurbit 
Consortium and cucurbit growers in Maryland and Delaware; growers in 
the forest nursery sector (Southern Forest Nursery Management 
Cooperative, Northeastern Forest and Conservation Nursery Association, 
and Michigan seedling growers); members of the Southeastern Pepper 
Consortium; members of the Southeastern Strawberry Consortium and 
Florida strawberry growers; California sweet potato slip growers; 
members of the Southeastern Tomato Consortium and Virginia tomato 
growers. For each of these uses, EPA found that there are technically 
and economically feasible alternatives to methyl bromide.
    Finally, EPA is limiting the CUE for cucurbit, eggplant, pepper, 
and tomato sectors in Georgia to small growers. The EPA review of the 
available information for Georgia indicates that farmers growing fewer 
than 10 acres of these crops need an additional year to successfully 
transition to the alternatives. These small growers do not have as much 
experience with the alternatives and need to convert their equipment to 
the University of Georgia (UGA) ``3-Way'' mixture (a combination of 
1,3-dichloropropene, chloropicrin, and metam). The EPA conducted an 
economic assessment of small growers' ability to convert their 
equipment (see revised nomination, dated July 14, in the docket). The 
assessment demonstrates that despite the UGA 3-Way mixture being more 
affordable than methyl bromide plus chloropicrin on a per acre basis, 
retrofitting farm equipment to use the UGA 3-Way mixture at a cost of 
$3,450 is not affordable for growers under four acres, amortized over 
10 years at 7% interest (7% is a home equity loan rate for this region 
at the time the nomination was submitted; interest on agricultural 
loans could be lower). However, due to variations in impacts for 
individual growers and uncertainties in the assumptions used in the 
economic analysis, farms smaller than 10 acres are reasonably expected 
to incur negative impacts from having to covert to the UGA 3-Way 
mixture. This analysis can be found in the July 14, 2011, reply to 
MBTOC available in the docket to this rule. Therefore, EPA is limiting 
the Georgia cucurbit, eggplant, pepper, and tomato critical uses to 
small growers, which EPA defines as growers growing fewer than 10 
acres.
    EPA is repeating the following clarifications made in previous 
years for ease of reference. The ``local township limits prohibiting 
1,3-dichloropropene'' are prohibitions on the use of 1,3-
dichloropropene products in cases where local township limits on use of 
this alternative have been reached. In addition, ``pet food'' under 
subsection B of Food Processing refers to food for domesticated dogs 
and cats. Finally, ``rapid fumigation'' for commodities is when a buyer 
provides short (two working days or fewer) notification for a purchase 
or there is a short period after harvest in which to fumigate and there 
is limited silo availability for using alternatives.
    EPA received a request from two commenters that the agency confirm 
that being removed from the table of approved critical uses for 2013 
does not preclude the use from being added back in the future. The 
Agency reviews every application received each year against the CUE 
criteria. The removal of a user from the list of approved critical uses 
indicates that a determination was made that technically or 
economically feasible alternatives exist. However, the EPA recognizes 
that circumstances may change, or additional information emerge, that 
could merit including that use in a future nomination. Furthermore, EPA 
recognizes that in 2003 the Parties to the Montreal Protocol recognized 
in Decision ExI.3 that each Party should aim at significantly and 
progressively decreasing its production and consumption of methyl 
bromide for critical uses with the intention of completely phasing out 
methyl bromide as soon as technically and economically feasible 
alternatives are available.

D. Critical Use Amounts

    Table A of the annex to Decision XXIII/4 lists critical uses agreed 
to by the Parties to the Montreal Protocol. The maximum amount of new 
production and consumption for U.S. critical uses,

[[Page 43801]]

specified in Table B of Decision XXIII/4, is 562,326 kg, minus 
available stocks. This figure is equivalent to 2.2% of the U.S. 1991 
methyl bromide consumption baseline of 25,528,270 kg.
    EPA received three comments supporting the proposal to allocate at 
least the full amount authorized by the Parties. Two of those 
commenters stated that EPA should allocate more than the amount 
requested in the CUN. One commenter stated that this is appropriate 
since the nomination was based on the continued availability of 
iodomethane. The other commenter stated that the CUN was inadequate and 
failed to reflect the need for methyl bromide as identified in the 
applications that were filed. Therefore, the proposed amount is 
insufficient to meet the critical needs of U.S. growers. One commenter 
questioned whether it would ever be appropriate for EPA to allocate 
less than the full amount authorized by the Parties.
    EPA is not allocating at or above the amount in the CUN. The CUN 
itself exceeds the amount authorized by the Parties. As EPA stated in 
the proposed rule, EPA views the determination of the total allocation, 
up to the amount authorized by the Parties, as an appropriate exercise 
of discretion. The agency will not increase the quantities in the final 
rule beyond those authorized by the Parties, but may exercise its 
discretion to allocate less. Article 2H(5) of the Montreal Protocol 
provides that the 2005 methyl bromide phaseout shall not apply ``to the 
extent the Parties decide to permit the level of production or 
consumption that is necessary to satisfy uses agreed by them to be 
critical uses.'' Decision XXIII/4 contains the Parties' critical use 
authorization for 2013. In this rule, EPA is honoring commitments made 
by the United States in the Montreal Protocol context, including 
Decision XXIII/4. For 2013, EPA is allocating the full amount 
authorized by the Parties.
    In the past, EPA has also made reductions to the CUA amount to 
account for the amount specifically authorized for research, on the 
assumption that research amounts would come from inventory. One 
commenter stated that EPA failed to account for research use of methyl 
bromide in the proposed rule and should return to the previously 
established policy and allocate a separate research purpose allocation. 
EPA responds that the 2013 CUN did not include, and the Parties did not 
authorize, a separate amount for research, as had been done in prior 
years. As discussed in more detail in the 2011 CUE final rule (76 FR 
60736, 60743, September 30, 2011), EPA views research as part of the 
nomination for each individual critical use. Therefore, EPA is not 
making any adjustments for research, carryover, or the uptake of 
alternatives.
    Carryover Material The Parties in paragraph 6 of Decision XXIII/4 
``urge parties operating under critical-use exemptions to put in place 
effective systems to discourage the accumulation of methyl bromide 
produced under the exemption.'' EPA regulations prohibit methyl bromide 
produced or imported after January 1, 2005, under the critical use 
exemption from being added to the existing pre-2005 inventory. 
Quantities of methyl bromide produced, imported, exported, or sold to 
end-users under the critical use exemption in a control period must be 
reported to EPA the following year. EPA uses these reports to calculate 
the amount of methyl bromide produced or imported under the critical 
use exemption, but not exported or sold to end-users in that year. EPA 
deducts an amount equivalent to this ``carryover'' from the total level 
of allowable new production and import in the year following the year 
of the data report. Carryover material (which is produced using 
critical use allowances) is not included in EPA's definition of 
existing inventory (which applies to pre-2005 material) because this 
would lead to a double-counting of carryover amounts, and a double 
reduction of critical use allowances (CUAs).
    All critical use methyl bromide that companies reported to be 
produced or imported in 2011 was sold to end users. The information 
reported to EPA is that 1,499 MT of critical use methyl bromide was 
produced or imported in 2011. Slightly more than the amount produced or 
imported was actually sold to end-users. This additional amount was due 
to distributors selling material that was carried over from the prior 
control period. Therefore, EPA is applying the carryover deduction of 0 
kg to the new production amount. EPA's calculation of the amount of 
carryover at the end of 2011 is consistent with the method used in 
previous CUE rules, and with the method agreed to by the Parties in 
Decision XVI/6 for calculating column L of the U.S. Accounting 
Framework. Past U.S. Accounting Frameworks, including the one for 2011, 
are available in the public docket for this rulemaking.
    Uptake of Alternatives Under the existing framework, EPA considers 
data on the availability of alternatives that it receives following 
submission of each nomination to UNEP. In previous rules EPA has 
reduced the total CUE amount when a new alternative has been 
registered. When an alternative is withdrawn, EPA will not increase the 
total CUE amount above the amount authorized by the Parties. However, 
the section on critical stock allowances below discusses how EPA is 
responding to the withdrawal of iodomethane.
    Since the USG submitted the 2013 CUN, Dimethyl Disulfide (DMDS) has 
been registered in additional states. In July 2010, EPA registered DMDS 
to control nematodes, weeds, and pathogens in tomatoes, peppers, 
eggplants, curcurbits, strawberries, ornamentals and forest nursery 
seedlings, and onions. The CUN considered only a limited uptake of DMDS 
in 2013 as only a few states had registered DMDS and it was not 
registered in either California or Florida. EPA received comment that 
DMDS is now registered in twenty-seven states, including Georgia and 
Florida. The commenter requests that EPA reduce the new production/
import allocation to reflect the increased registrations and to reflect 
the success that growers have had in transitioning to alternatives 
generally. EPA also received one comment supporting the proposal not to 
make reductions for DMDS in the Southeast. The commenter also stated 
that even if California were to register DMDS, growers would transition 
cautiously to ensure it works for their circumstances.
    EPA is not making a reduction to the new production/import 
allocation based on these additional state registrations. As discussed 
below, 91% of the amount authorized for 2013 is for critical uses in 
California, which has not yet registered DMDS. Growers in Florida 
account for less than 3% of the authorized amount. EPA anticipates that 
the uptake of DMDS in Florida will therefore not significantly affect 
total demand for critical use methyl bromide.
    EPA does not believe that the progress California and Florida 
strawberry growers have made in transitioning to alternatives means, as 
one commenter suggests, that the EPA should reduce the allocation 
amounts in the 2013 rule. EPA recognizes that strawberry growers are 
successfully transitioning to alternatives, and the CUE allocation for 
strawberries has been declining as that transition has occurred. EPA 
has considered the transition made to date, and the ability of 
strawberry growers to further transition, when developing the 
nomination. Transition rates for alternatives have already been applied 
for authorized 2013 critical use amounts through the nomination and 
authorization process.
    One commenter stated that the proposed rule did not take into 
account

[[Page 43802]]

the proposed tolerance revocation of sulfuryl fluoride. As EPA has 
stated in prior rules, this allocation rule is based on the current 
status of alternatives and is limited to 2013. The proposed tolerance 
revocation includes a staggered implementation scheme so that it is 
unlikely that any specific revocation will be effective as soon as 2013 
(76 FR 3447). Therefore, EPA has not based the allocation amounts for 
2013 on any anticipated impacts of that proposal on methyl bromide use.
    In summary, EPA is exempting 562,326 kg of new production and 
import of methyl bromide for critical uses in 2013. EPA is allocating 
allowances to the four companies that hold baseline allowances. The 
allocation, as in previous years, is in proportion to those baseline 
amounts, as shown in the table at 40 CFR 82.8(c)(1).
    Paragraph 3 of Decision XXIII/4 states ``that parties shall 
endeavor to license, permit, authorize or allocate quantities of methyl 
bromide for critical uses as listed in table A of the annex to the 
present decision.'' This is similar to language in prior Decisions 
authorizing critical uses. These Decisions call on Parties to endeavor 
to allocate critical use methyl bromide on a sector basis. The 
Framework Rule proposed several options for allocating critical use 
allowances, including a sector-by-sector approach. The agency evaluated 
various options based on their economic, environmental, and practical 
effects. After receiving comments, EPA determined that a lump-sum, or 
universal, allocation, modified to include distinct caps for pre-plant 
and post-harvest uses, was the most efficient and least burdensome 
approach that would achieve the desired environmental results, and that 
a sector-by-sector approach would pose significant administrative and 
practical difficulties. EPA received one comment supporting the 
continued use of the universal allocation approach. For the reasons 
discussed in the preamble to the 2009 CUE rule (74 FR 19894), the 
agency believes that the approach adopted in the Framework Rule is the 
most appropriate approach and that it is likely the actual critical use 
will closely follow the sector breakout listed in the Parties' 
decisions.

E. Critical Stock Allowances

    Decision XXIII/4 indicates that the United States' permitted level 
of production and consumption for 2013 is 562,326 kg minus ``available 
stocks.'' As part of this rulemaking, EPA considered what amount, if 
any, of existing stocks may be available to critical users during 2013.
1. Determining the Level of Available Stocks
    Individual Parties have the ability to determine their level of 
available stocks. The Parties to the Protocol recognized in their 
Decisions that the amount of available stocks may differ from the total 
amount of existing stocks. Decision XXIII/4 states that ``production 
and consumption of methyl bromide for critical uses should be permitted 
only if methyl bromide is not available in sufficient quantity and 
quality from existing stocks[hellip]'' In addition, earlier Decisions 
refer to the use of ``quantities of methyl bromide from stocks that the 
Party has recognized to be available.'' Decision XXIII/4 reinforces 
this concept by including the phrase ``minus available stocks'' as a 
footnote to the United States' authorized level of production and 
consumption in Table B.
    Section 604(d)(6) of the CAA does not require EPA to adjust the 
amount of new production and import to reflect the availability of 
stocks; however, as explained in previous rulemakings, making such an 
adjustment is a reasonable exercise of EPA's discretion under this 
provision. Pre-phaseout inventory, or ``stocks,'' refers to methyl 
bromide that was produced using consumption allowances prior to the 
2005 phaseout date under the Clean Air Act and the Montreal Protocol. 
It does not include methyl bromide that was produced after January 1, 
2005, under the critical use exemption and carried over into subsequent 
years. Nor does it include methyl bromide produced 1) under the 
quarantine and preshipment (QPS) exemption, 2) with Article 5 
allowances to meet the basic domestic needs of Article 5 countries, or 
3) for feedstock or transformation purposes.
    The aggregate amount of pre-phaseout methyl bromide reported as 
being in inventory at the end of 2012 is 627,066 kg. As explained in 
the 2008 CUE Rule, EPA intends to continue releasing aggregate methyl 
bromide inventory data reported to the agency under the reporting 
requirements at 40 CFR 82.13 at the end of each control period. If the 
number of competitors in the industry were to decline appreciably, EPA 
may revisit the question of whether the aggregate is entitled to 
treatment as confidential information and whether to release the 
aggregate without notice. EPA did not propose to change the treatment 
of submitted information but welcomes information concerning the 
composition of the industry. The aggregate information for 2003 through 
2013 is available in the docket.
    Consistent with EPA's past practice, and our commitments to the 
Parties, EPA considered the level of ``available stocks'' that may be 
allocated in this rulemaking. EPA requested comments on two approaches 
for determining how many CSAs to allocate. Under the first approach, 
the agency would calculate ``available stocks'' as either 5% or 0% of 
the existing inventory, as was reported to EPA on January 1, 2012. The 
second approach would be to continue using the existing framework of 
estimating drawdown and a supply chain factor. EPA is finalizing the 
first approach but finds that no stocks are available to meet the 
critical demand for 2013. Therefore, EPA is not issuing CSAs in this 
final rule.
    In this final rule, EPA is rejecting the older approach of using 
the existing framework to estimate drawdown. In the 2012 Final Rule, 
EPA recognized that our ``estimates [of available stocks] have become 
increasingly inexact in characterizing actual drawdown of pre-phaseout 
inventory, as the amounts in inventory have declined over time. EPA 
intends to consider the adequacy of using this formula to assess 
`available stocks' in a future action.''
    Initially, the drawdown estimate was a simple linear model based on 
past years' rates. EPA modified the approach in the 2009 CUE Rule when 
it became apparent that the inventory was decreasing exponentially 
rather than linearly. EPA noted that the slowing rate of drawdown was 
based mostly on the business decisions of the companies that hold pre-
phaseout inventory, and included aspects that are difficult for EPA to 
know or quantify, such as honoring long-term relationships with non-CUE 
customers or holding inventory in response to price fluctuations. To 
refine the analysis in subsequent rules EPA separately analyzed the use 
of inventory on critical uses, for which there are a set number of 
allowances, and non-critical uses, for which there are not.
    Despite increased specificity, precise estimates still proved 
elusive. In successive years, EPA substantially overestimated inventory 
drawdown. In the 2012 Rule, EPA estimated a drawdown of 1,110,633 kg, 
when the actual drawdown was half that amount, or 556,794 kg. The 
results of the methodology using the updated data were sufficiently 
different that EPA considered providing additional notice and the 
opportunity to comment to incorporate them into the final allocation 
rule. EPA is concerned that as the total amount of both the U.S. 
authorization and the pre-phaseout stocks become smaller, efforts to 
perfect

[[Page 43803]]

EPA estimates in this area will delay needed rulemaking. The fact that 
the agency's projections consistently over-estimate the amount of 
inventory that will be drawn down is evidence that the approach 
substantially over-estimates the availability of pre-phaseout stocks.
    EPA believes constraints on the ability of critical users to 
acquire and use stocks may become worse due to a recent change in the 
geographic distribution of critical users. In the past, EPA has 
considered all pre-phaseout inventory to be available to all users, 
regardless of location. This assumption, as discussed in the 2009 CUE 
rule (74 FR 19887, April 30, 2009), was based on the fact that 
inventory is held in California and the Southeast, the two primary 
critical use growing regions, as well as other locations around the 
country. While the geographic distribution of inventory generally 
remains the same, the authorized critical uses have shifted to 
California over the last two years. In the 2011 control period, 49% of 
the total authorization was for pre-plant uses in California and 38% 
was for pre-plant uses in the Southeast. In 2013, this ratio is 91% and 
4% respectively.\1\ EPA believes that inventory held in the Southeast 
may not be equally available to critical users in California. Unlike 
newly produced or imported material, which enters nationwide 
distribution networks, inventory is mostly held by regional 
distributors. EPA received comment that the first priority of these 
distributors is to maintain the supply and service obligations they 
have to their customers within the geographic areas where they operate.
---------------------------------------------------------------------------

    \1\ EPA treats company-specific methyl bromide inventory 
information as confidential and believes that disaggregating the 
inventory data by geographic area could potentially reveal CBI. EPA 
solicited comment on this issue but did not propose to release data 
showing how much inventory is located in or near California. 
However, even in the absence of specific inventory data broken down 
by region, EPA believes that the fact that over 90% of critical use 
is in California is relevant to judging the availability of existing 
stocks.
---------------------------------------------------------------------------

    EPA proposed to allocate CSAs equal to 5% of the January 1, 2012, 
reported inventory, which is equal to 62,444 kg. EPA based this 
percentage on historic patterns of use. Since 2006, the amount of prior 
year inventory used through the expenditure of CSAs has ranged from 8% 
to 26%. EPA proposed an amount less than the historic pattern in an 
effort to ensure that the amount allocated for 2013 would be available 
to critical users in that year.
    EPA also solicited comment on allocating 0 kg from stocks. EPA was 
particularly interested in comments from critical stock allowance 
holders who would be barred under the existing framework from selling 
inventory to critical users in 2013 absent an allocation of CSAs. EPA 
stated it was interested in learning whether an allocation at or close 
to 0 kg would prevent the drawdown of stocks or prevent the fulfillment 
of contracts or commitments to sell pre-phaseout inventory in 2013. EPA 
also sought comment on whether the restriction at 40 CFR 82.4(p) that 
limits the sale of inventory to critical uses through the CSA 
allocation should be lifted.
    One commenter agreed that the prior calculation was unacceptably 
time consuming, unwieldy and prone to inaccuracies. This commenter 
stated that, especially with the withdrawal of iodomethane, EPA should 
authorize the full amount of critical use methyl bromide authorized by 
the Parties, and that even that amount may be insufficient to meet the 
needs of growers. However, this commenter also stated that a limited 
amount of CSAs is still appropriate to provide registrants and 
distributors flexibility to meet the needs of all growers. Therefore, 
this commenter supported the proposal to allocate 5% of the prior 
year's starting inventory.
    One commenter stated that the full amount for critical uses should 
come from new production. This commenter points out that the private 
parties holding stocks are the only ones who can decide to make them 
available, and states that it would be unreasonable to reduce the 
amount of new production due to those stocks. Another commenter stated 
that it was important for existing stocks to be available for drawdown, 
since otherwise stocks will never be used.\2\
---------------------------------------------------------------------------

    \2\ The commenter also stated that the stocks of methyl bromide 
should be available to non-critical uses. This commenter disagrees 
with EPA's Reregistration Eligibility Decision that resulted in the 
removal of various non-exempt uses from the methyl bromide product 
labels. This comment is beyond the scope of this rulemaking.
---------------------------------------------------------------------------

    EPA has considered all of these comments, and recent developments 
related to the critical use of methyl bromide, and has determined that 
it will allocate the full amount of the critical use authorization to 
new production, but also lift the prohibition on selling stocks of 
methyl bromide for critical uses without a CSA.
    EPA intends for the entire allocation of critical use allowances 
and critical stock allowances to be expended to meet each year's 
critical demand. However, the total allocation of critical stock 
allowances has never been used. In fact, typically one third to one 
half of the critical stock allowances allocated each year remains 
unexpended. EPA believes there is demand for methyl bromide given the 
fact that there was no carryover in 2010 and 2011. This means that all 
the methyl bromide that was produced or imported for critical uses for 
those years was used. However, 40% of the 2010 and 30% of the 2011 
critical stock allowance allocations were not used.
    Consistent with these data, comments to this and past allocation 
rules state that the existing inventory is not actually available to 
users because of reductions in the number of distributors and market 
decisions by distributors to sell inventory to current customers or 
hold inventory for future use. The recent concentration of critical 
uses in California may also mean that stocks in the Southeast are even 
more unavailable as a practical matter for critical users. The data 
show that inventory is continually less ``available'' than EPA 
estimated. At the same time, meeting the demand for critical use methyl 
bromide is especially important for 2013 due to the withdrawal of 
iodomethane. In light of these circumstances, including the facts that 
the agency is unable to require the sale of inventory to meet the 
critical demand and there is evidence that inventory will not be sold 
to meet that demand, EPA is determining that there are not stocks 
available to be allocated for 2013. Therefore, EPA is allocating 0 CSAs 
for 2013.
2. Amending the Critical Stock Allowance Framework
    For the reasons discussed above, EPA believes, as a practical 
matter, existing stocks of methyl bromide are not available for 
critical users in 2013. However, at the same time, EPA agrees that it 
would not be appropriate to completely prohibit use of existing stocks, 
since EPA does not believe that stocks should be held indefinitely. EPA 
solicited comment on whether the prohibition on selling stocks of MeBr 
for a critical use without a CSA should be lifted. After consideration 
of comments, EPA is lifting the prohibition.
    One provision in the framework rule, 40 CFR 82.4(p), limits the 
amount of pre-phaseout methyl bromide that can be sold for critical 
uses to the amount of critical stock allowances held by that 
distributor. EPA developed the concept of critical stock allowances in 
the Framework Rule to meet the requirement of Decision Ex I/3(3). That 
Decision states that ``a Party using stocks under paragraph 2 above 
shall prohibit the use of stocks [for critical uses][hellip] when 
amounts from stocks combined with allowable production

[[Page 43804]]

and consumption for critical uses exceed the total level for that Party 
set forth in annex II A to the present report.''
    As discussed in the Framework Rule, EPA read Decision Ex I/3(3) as 
calling for limits on the use of stocks for approved critical uses in 
order to receive the benefit of new production and import in that 
Decision for 2005. However, Decision Ex I/3(3) was only applicable to 
the 2005 control period. Subsequent Decisions by the Parties 
authorizing critical uses and new production and import amounts for 
later control periods did not contain similar language. For the reasons 
discussed herein, EPA no longer believes that the restrictions 
established by EPA to meet the requirements of Decision Ex I/3(3) 
remain appropriate. EPA believes this approach is consistent with 
Decision XXIII/4 which authorizes an amount of new production and 
import of methyl bromide for 2013 but does not call for limits on the 
total use of methyl bromide for critical uses.
    Several changes relevant to the drawdown of the pre-phaseout 
inventory have occurred since 2004. When the critical use exemption was 
being established by the Parties, the United States made assurances 
that it would responsibly manage the inventory. At that time, the 
inventory was 16,422 MT which is 26 times greater than the level of 
inventory today. The United States and other Parties were concerned 
that this large amount of inventory could overwhelm the critical use 
exemption. EPA therefore limited the use of inventory on critical uses 
through the issuance of critical stock allowances.
    Since that time, EPA has taken further steps to restrict the use of 
stocks through FIFRA labeling changes. Under the reregistration 
decision for methyl bromide, EPA removed all but seven non-critical 
``Group II uses'' from the pre-plant methyl bromide labels. Four of 
those seven uses were cancelled as of December 31, 2012, two will be 
removed at the end of 2013, and the last will be removed at the end of 
2014. As these Group II uses are removed from product labels, and as 
the number of critical uses decreases, the demand for pre-phaseout 
inventory will continue to decline. The decreasing number of uses and 
geographical limitations on critical use discussed above may also lead 
to a slowing in the rate of inventory drawdown.
    Together these two actions have the potential to significantly 
limit the use of inventory. However it is clear that the concerns 
expressed through Decision Ex I/3(3), to restrict the use of stocks, 
has also changed. Decision XXII/6, which authorized critical uses for 
2012, stressed that ``parties should reduce their stocks of methyl 
bromide retained for employment in critical-use exemptions to a minimum 
in as short a time period as possible.'' EPA believes that ending the 
restriction on the use of stocks for critical uses is appropriate to 
avoid a situation, either now or in the future, where the inventory 
becomes practically inaccessible. If this occurs, there will be few 
uses of inventory and stocks could remain indefinitely.
    To implement this change EPA is removing the restrictions at Sec.  
82.4(p)(ii) and (iii). In addition, EPA is removing the reference to 
CSAs from the definition of ``critical use methyl bromide.'' EPA 
believes additional conforming changes may be appropriate but will 
address those changes in a future rulemaking.
    EPA also requested comment on potential mechanisms within the Clean 
Air Act or other statutory authorities to respond to the withdrawal of 
iodomethane, and other unforeseen or emergency situations. EPA received 
three comments requesting that the agency undertake a rulemaking to 
implement Decision IX/7 regarding emergency uses of methyl bromide. One 
commenter noted that EPA announced in 2000 that it would draft a rule 
for emergency uses, which would be separate from its authority to grant 
emergency or crisis exemptions under FIFRA section 18. The commenter 
noted that clarification of the process for emergency uses, whether 
through section 18 or through additional rulemaking, is warranted since 
previous section 18 exemptions had been granted for methyl bromide 
prior to the 2005 phase-out.
    As EPA noted in the notice of proposed rulemaking and elsewhere, 
this rule implements the Clean Air Act's requirement to phase out 
consumption and production of methyl bromide, subject to the critical 
use exemption. Nothing in this rule is intended to derogate from FIFRA 
or provisions in any other Federal, State, or local laws or regulations 
governing actions including, but not limited to, the sale, 
distribution, transfer, and use of methyl bromide.
    The commenter went on to note that Australia and Canada have also 
utilized the Decision IX/7 emergency exemption provision of the 
Montreal Protocol. Another commenter notes that unforeseen shortages of 
methyl bromide alternatives could have the same effect as other 
emergency conditions that may warrant use exemptions.
    This spring EPA held discussions with USDA and the Department of 
State on whether emergency situations may arise that warrant the use of 
methyl bromide and other tools that could potentially address immediate 
and unforeseen needs for methyl bromide.

F. The Criteria in Decisions IX/6 and Ex. I/4

    Paragraphs 1 and 4 of Decision XXIII/4 request Parties to ensure 
that the conditions or criteria listed in Decisions Ex. I/4 and IX/6, 
paragraph 1, are applied to exempted critical uses for the 2013 control 
period. A discussion of the agency's application of the criteria in 
paragraph 1 of Decision IX/6 appears in Section II of this preamble. 
EPA solicited comments on the technical and economic basis for 
determining that the uses listed in this rule meet the criteria of the 
critical use exemption. The CUNs detail how each proposed critical use 
meets the criteria listed in paragraph 1 of Decision IX/6, apart from 
the criterion located at (b)(ii), as well as the criteria in paragraphs 
5 and 6 of Decision Ex. I/4.
    The criterion in Decision IX/6(1)(b)(ii), which refers to the use 
of available stocks of methyl bromide, is addressed in section II.E. of 
this preamble. The agency has previously provided its interpretation of 
the criterion in Decision IX/6(1)(a)(i) regarding the presence of 
significant market disruption in the absence of an exemption.
    The remaining considerations are addressed in the nomination 
documents including: the lack of available technically and economically 
feasible alternatives under the circumstance of the nomination; efforts 
to minimize use and emissions of methyl bromide where technically and 
economically feasible; the development of research and transition 
plans; and the requests in Decision Ex. I/4(5) and (6) that Parties 
consider and implement MBTOC recommendations, where feasible, on 
reductions in the critical use of methyl bromide and include 
information on the methodology they use to determine economic 
feasibility.
    Some of these criteria are evaluated in other documents as well. 
For example, the United States has considered the adoption of 
alternatives and research into methyl bromide alternatives, criterion 
(1)(b)(iii) in Decision IX/6, in the development of the National 
Management Strategy submitted to the Ozone Secretariat in December 
2005, updated in October 2009. The National Management Strategy 
addresses all of the aims specified in Decision Ex.I/4(3) to the extent 
feasible and is available in the docket for this rulemaking.

[[Page 43805]]

    There continues to be a need for methyl bromide in order to conduct 
the research required by Decision IX/6. A common example is an outdoor 
field experiment that requires methyl bromide as a standard control 
treatment with which to compare the trial alternatives' results. As 
discussed in the preamble to the 2010 CUE rule (75 FR 23179, May 3, 
2010), research is a key element of the critical use process. Research 
on the crops shown in the table in Appendix L to subpart A remains a 
critical use of methyl bromide. While researchers may continue to use 
newly produced material for field, post-harvest, and emission 
minimization studies requiring the use of methyl bromide, EPA 
encourages researchers to use pre-phaseout inventory. EPA also 
encourages distributors to make inventory available to researchers, to 
promote the continuing effort to assist growers to transition critical 
use crops to alternatives.

G. Emissions Minimization

    Previous decisions have stated that critical users shall employ 
emission minimization techniques such as virtually impermeable films, 
barrier film technologies, deep shank injection and/or other techniques 
that promote environmental protection, whenever technically and 
economically feasible. EPA developed a comprehensive strategy for risk 
mitigation through the 2006 Reregistration Eligibility Decision (RED) 
for methyl bromide, which is implemented through restrictions on how 
methyl bromide products can be used. This approach requires that methyl 
bromide labels include directions that treated sites be tarped except 
for California orchard replant where EPA instead requires deep (18 
inches or greater) shank applications. The RED also incorporated 
incentives for applicators to use high-barrier tarps, such as virtually 
impermeable film (VIF), by allowing smaller buffer zones around those 
sites. In addition to minimizing emissions, use of high-barrier tarps 
has the benefit of providing pest control at lower application rates. 
The amount of methyl bromide nominated by the United States reflects 
the lower application rates necessary when using high-barrier tarps, 
where such tarps are allowed.
    EPA will continue to work with the U.S. Department of Agriculture--
Agricultural Research Service (USDA-ARS) and the National Institute for 
Food and Agriculture (USDA-NIFA) to promote emission reduction 
techniques. The federal government has invested substantial resources 
into best practices for methyl bromide use, including emission 
reduction practices. The Cooperative Extension System, which receives 
some support from USDA-NIFA provides locally appropriate and project-
focused outreach education regarding methyl bromide transition best 
practices. Additional information on USDA research on alternatives and 
emissions reduction can be found at: http://www.ars.usda.gov/research/programs/programs.htm?NP_CODE=308 and http://www.csrees.usda.gov/fo/methylbromideicgp.cfm.
    Users of methyl bromide should continue to make every effort to 
minimize overall emissions of methyl bromide to the extent consistent 
with State and local laws and regulations. EPA also encourages 
researchers and users who are using such techniques to inform EPA of 
their experiences and to provide such information with their critical 
use applications.

III. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    Under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993), 
this final rule is a ``significant regulatory action'' because it was 
deemed to raise novel legal or policy issues. Accordingly, EPA 
submitted this action to the Office of Management and Budget (OMB) for 
review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 
2011) and any changes made in response to interagency recommendations 
have been documented in the docket for this action.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden. 
The application, recordkeeping, and reporting requirements have already 
been established under previous critical use exemption rulemakings and 
this action does not add any new requirements. The Office of Management 
and Budget (OMB) has previously approved the information collection 
requirements contained in the existing regulations at 40 CFR part 82 
under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et 
seq. and has assigned OMB control number 2060-0482. The OMB control 
numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The RFA generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice-and-comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small organizations, and small 
governmental jurisdictions. For purposes of assessing the impacts of 
this rule on small entities, small entity is defined as: (1) A small 
business as defined by the Small Business Administration's regulations 
at 13 CFR 121.201 (see Table below); (2) a small governmental 
jurisdiction that is a government of a city, county, town, school 
district or special district with a population of less than 50,000; and 
(3) a small organization that is any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.

----------------------------------------------------------------------------------------------------------------
                                                                                      NAICS Small business size
                                                                                       standard  (in number of
              Category                     NAICS Code               SIC Code           employees or millions of
                                                                                               dollars)
----------------------------------------------------------------------------------------------------------------
Agricultural production............  1112--Vegetable and     0171--Berry Crops.....  $0.75 million.
                                      Melon farming.         0172--Grapes..........
                                     1113--Fruit and Nut     0173--Tree Nuts.......
                                      Tree Farming.          0175--Deciduous Tree
                                     1114--Greenhouse,        Fruits (except apple
                                      Nursery, and            orchards and farms)..
                                      Floriculture           0179--Fruit and Tree
                                      Production.             Nuts, NEC..

[[Page 43806]]

 
                                                             0181--Ornamental
                                                              Floriculture and
                                                              Nursery Products.
                                                             0831--Forest Nurseries
                                                              and Gathering of
                                                              Forest Products..
Storage Uses.......................  115114--Postharvest     2041--Flour and Other   $7 million.
                                      Crop activities         Grain Mill Products.   500 employees.
                                      (except Cotton         2044--Rice Milling....  500 employees.
                                      Ginning).              4225--General           $25.5 million.
                                     311211--Flour Milling.   Warehousing and        $25.5 million.
                                     311212--Rice Milling..   Storage.
                                     493110--General         4221--Farm Product
                                      Warehousing and         Warehousing and
                                      Storage.                Storage.
                                     493130--Farm Product
                                      Warehousing and
                                      Storage.
Distributors and Applicators.......  115112--Soil            0721--Crop Planting,    $7 million.
                                      Preparation, Planting   Cultivation, and
                                      and Cultivating.        Protection.
Producers and Importers............  325320--Pesticide and   2879--Pesticides and    500 employees.
                                      Other Agricultural      Agricultural
                                      Chemical                Chemicals, NEC.
                                      Manufacturing.
----------------------------------------------------------------------------------------------------------------

    Agricultural producers of minor crops and entities that store 
agricultural commodities are categories of affected entities that 
contain small entities. This rule only affects entities that applied to 
EPA for an exemption to the phaseout of methyl bromide. In most cases, 
EPA received aggregated requests for exemptions from industry 
consortia. On the exemption application, EPA asked consortia to 
describe the number and size distribution of entities their application 
covered. EPA estimated that 3,218 entities petitioned EPA for an 
exemption for the 2005 control period. EPA revised this estimate in 
2011 down to 1,800 end users of critical use methyl bromide. EPA 
believes that the number continues to decline as growers cease applying 
for critical uses. Since many applicants did not provide information on 
the distribution of sizes of entities covered in their applications, 
EPA estimated that, based on the above definition, between one-fourth 
and one-third of the entities may be small businesses. In addition, 
other categories of affected entities do not contain small businesses 
based on the above description.
    After considering the economic impacts of this rule on small 
entities, I certify that this action will not have a significant 
economic impact on a substantial number of small entities. In 
determining whether a rule has a significant economic impact on a 
substantial number of small entities, the impact of concern is any 
significant adverse economic impact on small entities, since the 
primary purpose of the regulatory flexibility analyses is to identify 
and address regulatory alternatives ``which minimize any significant 
economic impact of the proposed rule on small entities.'' (5 U.S.C. 
603-604). Thus, an agency may certify that a rule will not have a 
significant economic impact on a substantial number of small entities 
if the rule relieves a regulatory burden, or otherwise has a positive 
economic effect on all of the small entities subject to the rule. Since 
this rule exempts methyl bromide for approved critical uses after the 
phaseout date of January 1, 2005, this action confers a benefit to 
users of methyl bromide. EPA estimates in the Regulatory Impact 
Assessment found in the docket to this rule that the reduced costs 
resulting from the de-regulatory creation of the exemption are 
approximately $22 million to $31 million on an annual basis (using a 3% 
or 7% discount rate respectively). We have therefore concluded that 
this rule would relieve regulatory burden for all small entities.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for State, local, or tribal governments or the private 
sector. The action imposes no enforceable duty on any State, local or 
tribal governments or the private sector. Instead, this action provides 
an exemption for the manufacture and use of a phased out compound and 
would not impose any new requirements on any entities. Therefore, this 
action is not subject to the requirements of sections 202 or 205 of the 
UMRA. This action is also not subject to the requirements of section 
203 of UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It 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 levels of government, as 
specified in Executive Order 13132. This rule is expected to affect 
producers, suppliers, importers, and exporters and users of methyl 
bromide. Thus, Executive Order 13132 does not apply to this rule. In 
the spirit of Executive Order 13132, and consistent with EPA policy to 
promote communications between EPA and State and local governments, EPA 
specifically solicited comment on this action from State and local 
officials.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). This rule does 
not significantly or uniquely affect the communities of Indian tribal 
governments nor does it impose any enforceable duties on communities of 
Indian tribal governments. Thus, Executive Order 13175 does not apply 
to this action. EPA specifically solicited additional comment on this 
action from tribal officials.

[[Page 43807]]

G. Executive Order No. 13045: Protection of Children From Environmental 
Health and Safety Risks

    This action is not subject to EO 13045 (62 FR 19885, April 23, 
1997) because it is not economically significant as defined in EO 
12866, and because the Agency does not believe the environmental health 
or safety risks addressed by this action present a disproportionate 
risk to children. This rule affects the level of environmental 
protection equally for all affected populations without having any 
disproportionately high and adverse human health or environmental 
effects on any population.

H. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This rule is not a ``significant energy action'' as defined in 
Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 28355 
(May 22, 2001)) because it is not likely to have a significant adverse 
effect on the supply, distribution, or use of energy. This rule does 
not pertain to any segment of the energy production economy nor does it 
regulate any manner of energy use. Therefore, we have concluded that 
this rule is not likely to have any adverse energy effects.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards bodies. NTTAA directs EPA to provide 
Congress, through OMB, explanations when the agency decides not to use 
available and applicable voluntary consensus standards. This rulemaking 
does not involve technical standards. Therefore, EPA did not consider 
the use of any voluntary consensus standards.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this rule does not have disproportionately 
high and adverse human health or environmental effects on minority or 
low-income populations, because it affects the level of environmental 
protection equally for all affected populations without having any 
disproportionately high and adverse human health or environmental 
effects on any population, including any minority or low-income 
population. Any ozone depletion that results from this rule will impact 
all affected populations equally because ozone depletion is a global 
environmental problem with environmental and human effects that are, in 
general, equally distributed across geographical regions in the United 
States.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A Major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action not a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective July 22, 2013.

List of Subjects in 40 CFR Part 82

    Environmental protection, Chemicals, Exports, Imports, Ozone 
depletion.

    Dated: July 16, 2013.
Bob Perciasepe,
Acting Administrator.

    For the reasons stated in the preamble, 40 CFR Part 82 is amended 
as follows:

PART 82--PROTECTION OF STRATOSPHERIC OZONE

0
1. The authority citation for part 82 continues to read as follows:

    Authority: 42 U.S.C. 7414, 7601, 7671-7671q.

0
2. Section 82.3 is amended by revising the definition of ``Critical use 
methyl bromide'' to read as follows:

Sec.  82.3  Definitions for class I and class II controlled substances.

* * * * *
    Critical use methyl bromide means the class I, Group VI controlled 
substance produced or imported through expending a critical use 
allowance or that portion of inventory produced or imported prior to 
the January 1, 2005 phaseout date that is sold only for approved 
critical uses.
* * * * *

0
3. Section 82.4 is amended by revising paragraph (p)(1) to read as 
follows:

Sec.  82.4  Prohibitions for Class I controlled substances.

* * * * *
    (p) * * *
    (1) No person shall sell critical use methyl bromide without first 
receiving a certification from the purchaser that the quantity 
purchased will be sold or used solely for an approved critical use. 
Every kilogram of critical use methyl bromide sold without first 
obtaining such certification constitutes a separate violation of this 
subpart.
* * * * *

0
4. Section 82.8 is amended as follows:
0
a. Revising paragraph (c) introductory text;
0
b. Revising the table in paragraph (c)(1);
0
c. Removing and reserving paragraph (c)(2).

Sec.  82.8  Grant of essential use allowances and critical use 
allowances.

* * * * *
    (c) Effective January 1, 2005, critical use allowances are 
apportioned as set forth in paragraph (c)(1) of this section for the 
exempted production and import of class I, Group VI controlled 
substances specifically for those approved critical uses listed in 
appendix L to this subpart for the applicable control period. Every 
kilogram of production and import in excess of the total number and 
type of unexpended critical use allowances held for a particular type 
of use constitutes a separate violation of this subpart.
    (1) * * *

[[Page 43808]]

----------------------------------------------------------------------------------------------------------------
                                                                   2013 Critical use        2013 Critical use
                                                                  allowances for pre-      allowances for post-
                            Company                                   plant uses *            harvest uses *
                                                                      (kilograms)              (kilograms)
----------------------------------------------------------------------------------------------------------------
Great Lakes Chemical Corp. A Chemtura Company.................                  323,564                   18,162
Albemarle Corp................................................                  133,057                    7,469
ICL-IP America................................................                   73,530                    4,127
TriCal, Inc...................................................                    2,289                      129
���������������������������������������������������������������
    Total **..................................................                  532,440                  29,886
----------------------------------------------------------------------------------------------------------------
* For production or import of Class I, Group VI controlled substance exclusively for the Pre-Plant or Post-
  Harvest uses specified in appendix L to this subpart.
** Due to rounding, numbers do not add exactly.

    (2) [Reserved]

0
5. Appendix L to Subpart A is revised to read as follows:

 Appendix L to Subpart A of Part 82--Approved Critical Uses and Limiting
     Critical Conditions for Those Uses for the 2013 Control Period
------------------------------------------------------------------------
          Column A                  Column B              Column C
------------------------------------------------------------------------
   Approved Critical Uses       Approved Critical     Limiting Critical
                                User and Location      Conditions that
                                      of Use          exist, or that the
                                                      approved critical
                                                       user reasonably
                                                     expects could arise
                                                        without methyl
                                                     bromide fumigation:
------------------------------------------------------------------------
                             PRE-PLANT USES
------------------------------------------------------------------------
Cucurbits...................  Georgia growers on    Moderate to severe
                               fewer than 10 acres.  yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     root knot nematode
                                                     infestation.
Eggplant....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Moderate to severe
                                                     pythium collar,
                                                     crown and root rot.
                                                    Moderate to severe
                                                     southern blight
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
Nursery Stock (Fruit, Nut,    Members of the        Moderate to severe
 Flower).                      California            nematode
                               Association of        infestation.
                               Nursery and Garden   Medium to heavy clay
                               Centers               soils.
                               representing         Local township
                               Deciduous Tree        limits prohibiting
                               Fruit Growers.        1,3-
                                                     dichloropropene.
Orchard Replant.............  California stone      Moderate to severe
                               fruit, table and      nematode
                               raisin grape, wine    infestation.
                               grape, walnut, and   Moderate to severe
                               almond growers.       soilborne disease
                                                     infestation.
                                                    Replanted orchard
                                                     soils to prevent
                                                     orchard replant
                                                     disease.
                                                    Medium to heavy
                                                     soils.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.
Ornamentals.................  (a) California        Moderate to severe
                               growers.              soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.

[[Page 43809]]

 
                              (b) Florida growers.  Moderate to severe
                                                     weed infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
Peppers.....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation, or
                                                     moderate to severe
                                                     pythium root and
                                                     collar rots.
                                                    Moderate to severe
                                                     southern blight
                                                     infestation, crown
                                                     or root rot.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
Strawberry Fruit............  California growers..  Moderate to severe
                                                     black root rot or
                                                     crown rot.
                                                    Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.
                                                    Time to transition
                                                     to an alternative.
Strawberry Nurseries........  California growers..  Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
Tomatoes....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
------------------------------------------------------------------------
                            POST-HARVEST USES
------------------------------------------------------------------------
Food Processing.............  (a) Rice millers in   Moderate to severe
                               the U.S. who are      beetle, weevil, or
                               members of the USA    moth infestation.
                               Rice Millers         Presence of
                               Association.          sensitive
                                                     electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.
                              (b) Pet food          Moderate to severe
                               manufacturing         beetle, moth, or
                               facilities in the     cockroach
                               U.S. who are          infestation.
                               members of the Pet   Presence of
                               Food Institute.       sensitive
                                                     electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.
                              (c) Members of the    Moderate to severe
                               North American        beetle infestation.
                               Millers'             Presence of
                               Association in the    sensitive
                               U.S.                  electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.

[[Page 43810]]

 
Commodities.................  California entities   Rapid fumigation
                               storing walnuts,      required to meet a
                               dried plums, figs,    critical market
                               raisins, and dates    window, such as
                               (in Riverside         during the holiday
                               county only) in       season.
                               California.
Dry Cured Pork Products.....  Members of the        Red legged ham
                               National Country      beetle infestation.
                               Ham Association and  Cheese/ham skipper
                               the Association of    infestation.
                               Meat Processors,     Dermested beetle
                               Nahunta Pork Center   infestation.
                               (North Carolina),    Ham mite
                               and Gwaltney and      infestation.
                               Smithfield Inc.
------------------------------------------------------------------------

[FR Doc. 2013-17569 Filed 7-19-13; 8:45 am]
BILLING CODE 6560-50-P
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