Federal Register / Vol. 86, No. 120 / Friday, June 25, 2021 / Proposed Rules 33601 

Race area is an area described by a 

line bound by coordinates provided in 

latitude and longitude that outlines the 

boundary of a race area within the 

regulated area defined by this section. 

Spectator means a person or vessel 

not registered with the event sponsor as 

participants or assigned as official 

patrols. 

Spectator area is an area described by 

a line bound by coordinates provided in 

latitude and longitude that outlines the 

boundary of a spectator area within the 

regulated area defined by this part. 

(c) Special local regulations. (1) The 

COTP Maryland-National Capital 

Region or Event PATCOM may forbid 

and control the movement of all vessels 

and persons, including event 

participants, in the regulated area 

described in paragraph (a)(1) of this 

section. When hailed or signaled by an 

official patrol, a vessel or person in the 

regulated area shall immediately 

comply with the directions given by the 

patrol. Failure to do so may result in the 

Coast Guard expelling the person or 

vessel from the area, issuing a citation 

for failure to comply, or both. The COTP 

Maryland-National Capital Region or 

Event PATCOM may terminate the 

event, or a participant’s operations at 

any time the COTP Maryland-National 

Capital Region or Event PATCOM 

believes it necessary to do so for the 

protection of life or property. 

(2) Except for participants and vessels 

already at berth, a person or vessel 

within the regulated area at the start of 

enforcement of this section must 

immediately depart the regulated area. 

(3) A spectator must contact the Event 

PATCOM to request permission to 

either enter or pass through the 

regulated area. The Event PATCOM, and 

official patrol vessels enforcing this 

regulated area, can be contacted on 

marine band radio VHF–FM channel 16 

(156.8 MHz) and channel 22A (157.1 

MHz). If permission is granted, the 

spectator must enter the designated 

Spectator Area or pass directly through 

the regulated area as instructed by Event 

PATCOM. A vessel within the regulated 

area must operate at safe speed that 

minimizes wake. A spectator vessel 

must not loiter within the navigable 

channel while within the regulated area. 

(4) Only participant vessels and 

official patrol vessels are allowed to 

enter and remain within the race area. 

(5) Only participant vessels and 

official patrol vessels are allowed to 

enter and transit directly through the 

buffer area in order to arrive at or depart 

from the race area. 

(6) A person or vessel that desires to 

transit, moor, or anchor within the 

regulated area must obtain authorization 

from the COTP Maryland-National 

Capital Region or Event PATCOM. A 

person or vessel seeking such 

permission can contact the COTP 

Maryland-National Capital Region at 

telephone number 410–576–2693 or on 

Marine Band Radio, VHF–FM channel 

16 (156.8 MHz) or the Event PATCOM 

on Marine Band Radio, VHF–FM 

channel 16 (156.8 MHz). 

(7) The Coast Guard will publish a 

notice in the Fifth Coast Guard District 

Local Notice to Mariners and issue a 

marine information broadcast on VHF– 

FM marine band radio announcing 

specific event dates and times. 

(d) Enforcement officials. The Coast 

Guard may be assisted with marine 

event patrol and enforcement of the 

regulated area by other federal, state, 

and local agencies. 

(e) Enforcement period. This section 

will be enforced from 7:30 a.m. to 5 p.m. 

on October 2, 2021 and from 7:30 a.m. 

to 5 p.m. on October 3, 2021. 

Dated: June 15, 2021. 

David E. O’Connell, 

Captain, U.S. Coast Guard, Captain of the 

Port Maryland-National Capital Region. 

[FR Doc. 2021–13291 Filed 6–24–21; 8:45 am] 

BILLING CODE 9110–04–P 

LIBRARY OF CONGRESS 

Copyright Royalty Board 

37 CFR Part 385 

[Docket No. 21–CRB–0001–PR (2023–2027)] 

Determination of Rates and Terms for 

Making and Distributing Phonorecords 

(Phonorecords IV) 

AGENCY: Copyright Royalty Board, 

Library of Congress. 

ACTION: Proposed rule. 

SUMMARY: The Copyright Royalty Judges 

publish for comment proposed 

regulations that set rates and terms 

applicable during the period beginning 

January 1, 2023, and ending December 

31, 2027, for the section 115 statutory 

license for making and distributing 

phonorecords of nondramatic musical 

works. 

DATES: Comments and objections, if any, 

are due no later than July 26, 2021. 

ADDRESSES: You may send comments, 

identified by docket number 21–CRB– 

0001–PR (2023–2027), online through 

eCRB at https://app.crb.gov. 

Instructions: To send your comment 

through eCRB, if you don’t have a user 

account, you will first need to register 

for an account and wait for your 

registration to be approved. Approval of 

user accounts is only available during 

business hours. Once you have an 

approved account, you can only sign in 

and file your comment after setting up 

multi-factor authentication, which can 

be done at any time of day. All 

comments must include the Copyright 

Royalty Board name and the docket 

number for this proposed rule. All 

properly filed comments will appear 

without change in eCRB at https:// 

app.crb.gov, including any personal 

information provided. 

Docket: For access to the docket to 

read background documents or 

comments received, go to eCRB at 

https://app.crb.gov and perform a case 

search for docket 21–CRB–0001–PR 

(2023–2027). 

FOR FURTHER INFORMATION CONTACT: 

Anita Blaine, CRB Program Specialist, at 

202–707–7658 or crb@loc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

Section 115 of the Copyright Act, title 

17 of the United States Code, requires a 

copyright owner of a nondramatic 

musical work to grant a license (also 

known as the ‘‘mechanical’’ compulsory 

license) to any person who wants to 

make and distribute phonorecords of 

that work, provided that the copyright 

owner has allowed phonorecords of the 

work to be produced and distributed, 

and that the licensee complies with the 

statute and regulations. In addition to 

the production or distribution of 

physical phonorecords (compact discs, 

vinyl, cassette tapes, and the like), 

section 115 applies to digital 

transmissions of phonorecords, 

including permanent digital downloads 

and ringtones. 

Chapter 8 of the Copyright Act 

requires the Copyright Royalty Judges 

(Judges) to conduct proceedings every 

five years to determine the rates and 

terms for the section 115 license. 17 

U.S.C. 801(b)(1), 804(b)(4). Accordingly, 

the Judges commenced the current 

proceeding in January 2021, by 

publishing notice of the commencement 

and a request that interested parties 

submit petitions to participate. See 86 

FR 25 (Jan. 5, 2021). 

The Judges received petitions to 

participate in the current proceeding 

from Amazon.com Services LLC, Apple 

Inc., Copyright Owners (joint petitioners 

Nashville Songwriters Association 

International (NSAI) and National 

Music Publishers Association (NMPA)), 

Google LLC, George Johnson, Joint 

Record Company Participants (filed by 

Recording Industry Association of 

America, Inc. for joint petitioners Sony 

Music Entertainment, UMG Recordings, 


lotter on DSK11XQN23PROD with PROPOSALS1
33602 Federal Register / Vol. 86, No. 120 / Friday, June 25, 2021 / Proposed Rules 

1SoundCloud Operations Inc. withdrew from the 

proceeding on May 21, 2021. 

2The participants who filed the motion are the 

‘‘Publisher/Songwriter Participants’’ (NMPA and 

NSAI) and the ‘‘Record Company Participants’’ 

(Sony Music Entertainment, UMG Recordings, Inc. 

and Warner Music Group Corp.). Motion at 1. 

3Participants Amazon.com Services LLC, Google 

LLC, Pandora Media, LLC, and Spotify USA Inc. do 

not object to the settlement, Motion at 4 n.2, 

however, the movants state that they understand 

that participant George Johnson intends to object to 

it. Motion at 4. 

Inc., and Warner Music Group Corp.), 

Pandora Media, LLC, David Powell, 

SoundCloud Operations Inc.,1 Spotify 

USA Inc., and Brian Zisk. 

The Judges gave notice to all 

participants of the three-month 

negotiation period required by 17 U.S.C. 

803(b)(3) and directed that, if the 

participants were unable to negotiate a 

settlement, they should submit Written 

Direct Statements no later than 

September 10, 2021. On May 25, 2021, 

the Judges received a motion stating that 

several participants 2 had reached a 

partial settlement regarding the rates 

and terms under Section 115 of the 

Copyright Act, namely, for physical 

phonorecords, permanent downloads, 

ringtones, and music bundles for the 

2023–2027 rate period and seeking 

approval of that partial settlement. See 

Motion to Adopt Settlement of Statutory 

Royalty Rates and Terms for Subpart B 

Configurations, Docket No. 21–CRB– 

0001–PR (2023–2027) at 1 (May 25, 

2021) (Motion). The movants state that 

‘‘the settlement represents the 

consensus of buyers and sellers 

representing the vast majority of the 

market for ‘mechanical’ rights for [the 

37 CFR 385] Subpart B 

Configurations.’’ 3 Motion at 4. 

The settlement proposes that 

‘‘Subpart B Configuration Rates and 

Terms presently set forth in 37 CFR part 

385 subpart B . . . continue to be 

applicable to the Record Company 

Participants and all other licensees of 

‘mechanical’ rights in musical works for 

the Subpart B Configurations, for the 

rate period covered by the Proceeding, 

with only a few minor editorial changes 

to the applicable regulations.’’ Motion at 

3. 

The proposed editorial changes apply 

to §§ 385.10 and 385.11 of Subpart B 

and to two definitions in Subpart A and 

would clarify the regulations. For 

example, the definition of Licensed 

Activity needs to be changed to remove 

the reference to Subpart B because the 

term Licensed Activity does not appear 

in Subpart B. See 37 CFR 385.2, 385.10– 

11; Motion at 6–7 (redline of regulations 

with rationale for changes). 

Section 801(b)(7)(A) of the Copyright 

Act authorizes the Judges to adopt rates 

and terms negotiated by ‘‘some or all of 

the participants in a proceeding at any 

time during the proceeding’’ provided 

they are submitted to the Judges for 

approval. This section provides that the 

Judges shall provide notice and an 

opportunity to comment on the 

agreement to (1) those that would be 

bound by the terms, rates, or other 

determination set by the agreement and 

(2) participants in the proceeding that 

would be bound by the terms, rates, or 

other determination set by the 

agreement. See section 801(b)(7)(A). The 

Judges may decline to adopt the 

agreement as a basis for statutory terms 

and rates for participants not party to 

the agreement if any participant objects 

and the Judges conclude that the 

agreement does not provide a reasonable 

basis for setting statutory terms or rates. 

Id. 

If the Judges adopt rates and terms 

reached pursuant to a negotiated 

settlement, those rates and terms are 

binding on all copyright owners of 

musical works and those using the 

musical works in the activities 

described in the proposed regulations. 

The Judges propose an additional 

minor revision to change an outdated 

cross reference. They propose to shorten 

the cross reference 17 U.S.C. 

115(c)(3)(C) and (D) to 17 U.S.C. 115 

because the section no longer has a 

subsection (c)(3). See 17 U.S.C. 115; 

Orrin G. Hatch-Bob Goodlatte Music 

Modernization Act, Public Law 115– 

264, 132 Stat. 3676, 3679–3684 (Oct. 11, 

2018). 

The Judges solicit comments on 

whether they should adopt the proposed 

regulations as statutory rates and terms 

relating to the making and distribution 

of physical or digital phonorecords of 

nondramatic musical works. 

Comments and objections regarding 

the rates and terms and the minor 

revisions must be submitted no later 

than July 26, 2021. 

List of Subjects in 37 CFR Part 385 

Copyright, Phonorecords, Recordings. 

Proposed Regulations 

For the reasons set forth in the 

preamble, the Copyright Royalty Judges 

propose to amend 37 CFR part 385 as 

follows: 

PART 385—RATES AND TERMS FOR 

USE OF NONDRAMATIC MUSICAL 

WORKS IN THE MAKING AND 

DISTRIBUTING OF PHYSICAL AND 

DIGITAL PHONORECORDS 

■ 1. The authority citation for part 385 

continues to read as follows: 

Authority: 17 U.S.C. 115, 801(b)(1), 

804(b)(4). 

Subpart A—Regulations of General 

Application 

■ 2. In § 385.2 revise the introductory 

text of the definition for ‘‘Eligible 

Limited Download’’, the definition for 

‘‘Licensed Activity’’, and the fourth 

sentence for definition ‘‘Sound 

Recording Company’’ to read as follows: 

§ 385.2 Definitions. 

* * * * * 

Eligible Limited Download means a 

transmission of a sound recording 

embodying a musical work to an End 

User of a digital phonorecord under 17 

U.S.C. 115 that results in a Digital 

Phonorecord Delivery of that sound 

recording that is only accessible for 

listening for— * * * 

* * * * * 

Licensed Activity, as the term is used 

in subparts C and D of this part, means 

delivery of musical works, under 

voluntary or statutory license, via 

Digital Phonorecord Deliveries in 

connection with Interactive Eligible 

Streams, Eligible Limited Downloads, 

Limited Offerings, mixed Bundles, and 

Locker Services. 

* * * * * 

Sound Recording Company means a 

person or entity that: 

* * * * * 

(4) Performs the functions of 

marketing and authorizing the 

distribution of a sound recording of a 

musical work under its own label, under 

the authority of a person identified in 

paragraphs (1) through (3) of this 

section. 

* * * * * 

Subpart B—Physical Phonorecord 

Deliveries, Permanent Downloads, 

Ringtones, and Music Bundles 

■ 3. Revise § 385.10 to read as follows: 

§ 385.10 Scope. 

This subpart establishes rates and 

terms of royalty payments for making 

and distributing physical phonorecords, 

Permanent Downloads, Ringtones, and 

Music Bundles, in accordance with the 

provisions of 17 U.S.C. 115. 

■ 4. Revise § 385.11 paragraph (a) to 

read as follows: 

§ 385.11 Royalty rates. 

(a) Physical phonorecords and 

Permanent Downloads. For every 

physical phonorecord and Permanent 

Download the Licensee makes and 

distributes or authorizes to be made and 

distributed, the royalty rate payable for 

each work embodied in the phonorecord 


lotter on DSK11XQN23PROD with PROPOSALS1
Federal Register / Vol. 86, No. 120 / Friday, June 25, 2021 / Proposed Rules 33603 

1For a more detailed explanation of the 2015 Act 

and the civil monetary penalty inflation adjustment 

calculations that it requires, see NEH’s regulation 

implementing the 2015 Act at 85 FR 35566. 

2Table 1 details the annual adjustments to the 

PFCRA maximum penalty amount for years 2016– 

2021. 

or Permanent Download shall be either 

9.1 cents or 1.75 cents per minute of 

playing time or fraction thereof, 

whichever amount is larger. 

* * * * * 

Jesse M. Feder, 

Chief Copyright Royalty Judge. 

[FR Doc. 2021–12950 Filed 6–24–21; 8:45 am] 

BILLING CODE 1410–72–P 

NATIONAL FOUNDATION ON THE 

ARTS AND THE HUMANITIES 

National Endowment for the 

Humanities 

45 CFR Part 1174 

RIN 3136–AA36 

Implementation of the Program Fraud 

Civil Remedies Act of 1986 

AGENCY: National Endowment for the 

Humanities; National Foundation on the 

Arts and the Humanities. 

ACTION: Proposed rule with request for 

comments. 

SUMMARY: The National Endowment for 

the Humanities (NEH) is proposing to 

issue regulations to implement the 

Program Fraud Civil Remedies Act of 

1986 (PFCRA). The PFCRA authorizes 

certain Federal agencies, including 

NEH, to impose civil penalties and 

assessments through administrative 

adjudication against any person who 

makes, submits, or presents a false, 

fictitious, or fraudulent claim or written 

statement to NEH. The proposed rule 

will establish the procedures that NEH 

will follow in implementing the PFCRA, 

as well as specify the hearing and 

appeal rights of persons subject to 

penalties and assessments under the 

PFCRA. 

DATES: Send comments on or before July 

26, 2021. 

ADDRESSES: You may send comments by 

email to gencounsel@neh.gov. 

Instructions: Include ‘‘3136–AA36’’ in 

the subject line of the email. 

FOR FURTHER INFORMATION CONTACT: 

Elizabeth Voyatzis, Deputy General 

Counsel, Office of the General Counsel, 

National Endowment for the 

Humanities, 400 7th Street SW, Room 

4060, Washington, DC 20506; (202) 606– 

8322; gencounsel@neh.gov. 

SUPPLEMENTARY INFORMATION: 

1. Background 

In October 1986, Congress enacted the 

PFCRA, 31 U.S.C. 3801–3812. The 

PFCRA established an administrative 

remedy against any person who makes, 

or causes to be made, a false claim or 

written statement to certain Federal 

agencies. The PFCRA requires these 

Federal agencies to follow certain 

procedures in recovering penalties and 

assessments against people who file 

false claims or statements for which the 

liability is $150,000 or less. Initially, the 

PFCRA did not apply to NEH. Section 

10 of the Inspector General Reform Act 

of 2008, Public Law 110–409, 122 Stat. 

4314, however, expanded the PFCRA’s 

scope to include NEH. 

The PFCRA requires each covered 

agency to promulgate rules and 

regulations necessary to implement its 

provisions. Following the PFCRA’s 

enactment, the President’s Council on 

Integrity and Efficiency requested that 

the Department of Health and Human 

Services lead an inter-agency task force 

to develop model PFCRA regulations. 

This action was in keeping with the 

Senate Governmental Affairs 

Committee’s desire that ‘‘the regulations 

would be substantially similar 

throughout the government’’ (S. Rep. 

No. 99–212, 99th Cong., 1st Sess. 12 

(1985)). The Council recommended that 

all covered agencies adopt the model 

rule. 

Accordingly, NEH is implementing 

the PFCRA’s provisions through this 

proposed rule—which substantively 

conforms to the model rule—in order to 

establish procedures by which NEH will 

seek to recover penalties and 

assessments against persons who file, or 

cause to have filed, false claims or 

statements with NEH for which liability 

is $150,000 or less. 

2. Maximum Penalty Amount 

The PFCRA established a maximum 

penalty of $5,000 for each violation. The 

Federal Civil Penalties Inflation 

Adjustment Act Improvements Act of 

2015 (the 2015 Act), 28 U.S.C. 2461 

note, required all Federal agencies to (1) 

adjust the penalty amount to 2016 

inflation levels with an initial ‘‘catchup’’ inflation adjustment; and (2) make 

subsequent annual adjustments for 

inflation.1 This proposed rule 

incorporates the initial ‘‘catch-up’’ 

adjustment to 2016 inflation levels and 

the annual adjustments for 2017 through 

2021, and applies those adjustments 

cumulatively to the civil monetary 

penalties that the PFCRA imposes.2

A. Initial ‘‘Catch-Up’’ and 2021 

Adjustments for Inflation 

NEH determined the first ‘‘catch-up’’ 

adjustment to 2016 inflation levels 

using the formula set forth in the 2015 

Act. Specifically, NEH calculated the 

percent change between the Consumer 

Price Index for all Urban Consumers 

(CPI–U) for October of the last year in 

which Congress adjusted the PFCRA 

civil penalties (October 1986) and the 

CPI–U for October 2015, and then 

rounded to the nearest dollar. 

NEH similarly determined each 

subsequent annual adjustment by 

calculating the percent increase between 

the CPI–U for the month of October 

preceding the date of the adjustment 

and the CPI–U for the October one year 

prior to the October immediately 

preceding the date of the adjustment. 

Table 1, below, details the above 

calculations. 

TABLE 1—ANNUAL ADJUSTMENTS TO PFCRA CIVIL MONETARY PENALTIES, 2016–2021 

Effective date 

Baseline 

maximum 

penalty 

Applicable 

multiplier 

based on 

percent 

increase 

in CPI–U 

New baseline 

maximum 

penalty 

August 1, 2016 ............................................................................................................................ $5,000 3 2.15628 $10,781 

January 15, 2017 ......................................................................................................................... 10,781 4 1.01636 10,957 

January 15, 2018 ......................................................................................................................... 10,957 5 1.02041 11,181 

January 15, 2019 ......................................................................................................................... 11,181 6 1.02522 11,463 

January 15, 2020 ......................................................................................................................... 11,463 7 1.01764 11,665 


lotter on DSK11XQN23PROD with PROPOSALS1