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###### Department of Transportation

###### Federal Motor Carrier Safety Administration 

          - 49 CFR Part 365 
          - [Docket No. FMCSA-98-3298] 
          - RIN 2126-AA34 

# AGENCY:

Federal Motor Carrier Safety Administration (FMCSA), DOT. 

# ACTION:

Notice of proposed rulemaking (NPRM); request for comments. 

# SUMMARY:

The FMCSA proposes changes in its regulations to govern applications by Mexican carriers to operate beyond municipalities and commercial zones at the United States-Mexico border. The FMCSA also proposes to revise the application form, OP-1(MX), to be filed by these Mexican motor carriers. The proposed form would require additional information about the applicant's business and operating practices to allow the FMCSA to determine if the applicant could meet the safety standards established for operating in interstate commerce in the United States. Carriers that had previously submitted an application would have to submit the updated form. These proposed changes are needed to implement part of the North American Free Trade Agreement (NAFTA). 

# DATES:

We must receive your comments by July 2, 2001. 

# ADDRESSES:

                            You can mail, fax, hand deliver or electronically submit written comments to the Docket Management Facility, U.S. Department of Transportation, Dockets Management Facility, Room PL-401, 400 Seventh Street, SW., Washington, DC 20590-0001 FAX (202) 493-2251, on-line at                             *http://dmses.dot.gov/​submit.*                             You must include in your comment the docket number that appears in the heading of this document. You can examine and copy all comments at the above address from 9 a.m. to 5 p.m., e.t., Monday through Friday, except Federal holidays. You can also view all comments or download an electronic copy of this document from the DOT Docket Management System (DMS) at                             *http://dms.dot.gov/​search.htm*                             and typing the last four digits of the docket number appearing at the heading of this document. The DMS is available 24 hours each day, 365 days each year. You can get electronic submission and retrieval help and guidelines at the “Help” section of the web site. If you want us to notify you that we received your comments, please include a self-addressed, stamped envelope or postcard, or print the acknowledgement page that appears after submitting comments on-line.                         

# FOR FURTHER INFORMATION CONTACT:

Ms. Valerie Height, (202) 366-1790, Regulatory Development Division, FMCSA, 400 Seventh Street, SW., Washington, DC 20590. Office hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, except Federal holidays. 

# SUPPLEMENTARY INFORMATION:

We will include comments received after the comment closing date in the docket, and we will consider late comments to the extent practicable. The FMCSA may, however, issue a final rule at any time after the close of the comment period. 

## Background 

Under the Bus Regulatory Reform Act of 1982, (Pub. L. No. 97-261, 96 Stat. 1103) Congress imposed a two-year moratorium on issuance by the former Interstate Commerce Commission (ICC) of new grants of operating authority to motor carriers domiciled in a foreign country, or owned or controlled by persons of a foreign country. The legislation authorized the President to remove or modify the moratorium upon a determination that such action was in the national interest. As a result of legislative and executive extensions of the moratorium, only a limited class of Mexican motor carriers have operated in the United States on Certificates of Registration issued under what is now 49 CFR part 368. 

The terms of NAFTA, Annex I, provide that the moratorium on licensing Mexican motor carriers to operate within the United States would be lifted by the President in phases under the following schedule: 

(1) When NAFTA took effect on January 1, 1994, applications by Mexican bus operators to conduct cross border charter and tour bus services in international transportation service between Mexico and all points in the United States were to be accepted and processed by the ICC, and suitable authority issued. 

(2) In the second stage, beginning December 17, 1995, Mexican trucking companies engaged in the transportation of property were to be permitted to file applications for cross border operations between Mexico and four United States border states and establish companies within the United States to distribute international cargo within the United States 

(3) In the third phase, beginning January 1, 1997, applications were to be accepted and processed for Mexican passenger carriers to conduct regular route passenger operations in international service from Mexico to all points in the United States. 

(4) In the fourth phase, beginning January 1, 2000, Mexican property carriers were to be allowed to file applications for cross border operations from Mexico to all points in the United States (except for point-to-point carriage of domestic cargo within the United States, for which the moratorium has not been removed under NAFTA). 

(5) Finally, in the last phase, beginning on January 1, 2001, Mexican nationals were to be allowed to establish companies in the United States to provide point-to-point bus services in the United States. 

                        Pursuant to the first phase of NAFTA, on January 1, 1994, the ICC began accepting applications from Mexican passenger carriers to conduct international charter and tour bus operations into the United States. The ICC promulgated rules and a revised application form to effect the processing of Mexican applications (Ex Parte No. 55 (Sub-No. 96),                         *Freight Operations by Mexican Motor Carriers—Implementation of the North American Trade Agreement,*                        10 I.C.C. 2d 854                               ( print page 22372)                            (1995). These rules were anticipating the implementation of the second phase of NAFTA providing Mexican property carriers with additional access to the United States. A copy of the decision is in the public docket for this rulemaking. The ICC designated the revised application form OP-1(MX). On December 15, 1995, the International Brotherhood of Teamsters sought an emergency stay of the ICC decision in the United States Court of Appeals for the District of Columbia.                         *International Brotherhood of Teamsters*                        v.                         *Secretary of Transportation,*                        No. 95-1603 (D.C. Cir., filed Dec. 15, 1995). The Teamsters contended that the ICC decision was arbitrary and capricious because it failed to address serious concerns regarding the safe operation of Mexican motor carriers. The Teamsters had requested the ICC to add additional safety questions to the applications filed by Mexican carriers to ensure that the applicants were willing and able to comply with applicable safety regulations.                     

On December 18, 1995, the DOT announced a delay in implementing the NAFTA motor carrier access provisions. Because of safety concerns related to the operations of Mexican motor carriers and the lack of a motor carrier safety regulation and compliance program in Mexico, the ICC decided not to process applications from Mexican motor carriers for authority to operate in the United States border States in accordance with NAFTA's liberalization schedule. The FHWA continued this decision after the January 1, 1996, termination of the ICC and transfer of responsibilities to the FHWA. 

Mexico filed complaints against the United States under NAFTA's dispute resolution provisions, challenging the United States decision to deny further trucking, investment, and bus access. An arbitration panel met in May 2000 to hear the trucking and investment case, which was the subject of extensive pre-and post-hearing briefings on safety and legal issues. 

The panel issued a final report on February 6, 2001. A copy of the report is in the docket. The report unanimously concluded that the blanket refusal to process applications of Mexican motor carriers seeking United States operating authority out of concerns over the carriers' safety was in breach of NAFTA obligations of the United States, specifically NAFTA's liberalization provisions and provisions ensuring national treatment and most-favored-nation treatment for cross-border services. The panel also concluded that alleged deficiencies in Mexico's regulation of motor carrier safety did not relieve the United States of those NAFTA obligations. The panel stated, however, that the Department could subject Mexican motor carriers seeking to operate in the United States to different requirements than it applies to United States and Canadian carriers. The United States and Mexico have engaged in negotiations regarding the implementation of the liberalization provisions in light of the panel's decision. 

The FMCSA regulates commercial motor vehicle (CMV) safety in the United States under a comprehensive system of regulations designed to ensure that drivers are medically qualified;, meet applicable licensing standards; can read and speak the English language sufficiently to converse with the general public, understand highway traffic signs and signals in the English language, respond to official inquiries and make entries on reports and records; and do not operate vehicles while impaired by drugs, alcohol or excessive fatigue. We require that every CMV be equipped with certain standard safety-related equipment and that vehicles be regularly inspected and maintained to ensure that they remain in safe operating condition. We enforce these regulatory requirements through roadside inspections and on-site compliance reviews. Roadside inspections focus on potentially unsafe vehicle and driver violations that may pose a threat to public safety, unless the vehicle or driver is placed out of service. Our compliance reviews entail a review of a carrier's overall compliance with the Federal Motor Carrier Safety Regulations (FMCSRs) and Hazardous Materials Regulations. Our investigators examine carrier records (including driver logbooks and drug and alcohol testing information) and evaluate roadside vehicle inspection data, accident records, and other safety related information to determine whether a motor carrier meets safety fitness standards. 

The DOT has consulted extensively with Mexican transportation officials regarding the strengthening of Mexican truck safety regulation, and significant progress has been made in this area. Mexico has agreed to utilize the Commercial Vehicle Safety Alliance (CVSA) out-of-service (OOS) criteria and has issued final regulations based on these criteria. These standards cannot be effective without a safety oversight program, including systematic roadside inspections, to ensure compliance with and enforcement of the standards. The DOT officials have worked extensively with Mexican transportation officials on the establishment of such a program. However, Mexico has not yet completed implementation of a comprehensive safety inspection program. 

With the exception of border commercial zone drayage operations, Mexican carriers have, for the most part, little or no experience operating under regulations comparable to the FMCSRs. The FMCSA must be prepared to evaluate the safety fitness of motor carriers having no experience operating under a comprehensive system of safety regulation like ours. 

The FMCSA asks for public comment on proposed regulations and a revised Form OP-1(MX) that would require additional safety information and certifications of compliance with applicable safety requirements from all Mexican motor carrier applicants operating beyond the commercial zones. 

                        In another NPRM published elsewhere in today's                         **Federal Register**                        , RIN 2126-AA33                         *Revision of Regulations and Application Form for Mexican-Domiciled Motor Carriers to Operate in U.S. Municipalities and Commercial Zones on the U.S.-Mexico Border,*                         the FMCSA is proposing changes to the process and form (OP-2) used to obtain a Certificate of Registration. The changes would limit a Certificate of Registration to Mexican-domiciled motor carriers that operate, or will operate, only in the commercial zones adjoining the United States-Mexico border. All other Mexican carriers, including current holders of Certificates of Registration who operate beyond the commercial zones, would be subject to the proposals in this NPRM.                     

                        The FMCSA proposes to revise the OP-1(MX) application form by requiring each motor carrier applicant to answer questions to demonstrate its basic knowledge of the FMCSRs and to indicate how it intends to comply with these regulations. In addition, the FMCSA proposes to require each applicant to make specific certifications of compliance. This additional information will enable the FMCSA to determine that each applicant is willing and able to comply with the FMCSRs while conducting operations in the United States. In addition, the FMCSA would require applicants to submit verification from the Mexican government that the applicant is a registered Mexican carrier authorized to conduct motor carrier operations up to the United States-Mexico border and that all drivers who would operate in the United States have a valid Licencia Federal de Conductor issued by the Government of Mexico. These requirements also are consistent with section 210(b) of the Motor Carrier Safety Improvement Act of 1999 (Pub. L.                               ( print page 22373)                            106-159, 113 Stat. 1748) (MCSIA), which requires the Secretary to establish regulations ensuring that all applicant motor carriers, including foreign motor carriers, are knowledgeable about the FMCSRs before being granted authority to operate in the United States. Failure to provide such verification would result in the rejection of the application.                     

The FMCSA solicits comment from the public on our proposal that Mexican applicants who have filed for authority on the existing Form OP-1(MX) must file the proposed revised Form OP-1(MX) to update and supplement the information about their operations, including the requirement that the carrier be registered with the Government of Mexico. This requirement would ensure that FMCSA's database contains current and consistent information about Mexican registrants and thus enhance the effectiveness of FMCSA's safety oversight. 

These proposed requirements should not distract from, or detrimentally affect, the efforts underway between the Governments of Mexico and the United States to establish compatible regulations and to ensure that a comprehensive safety oversight program is put into place in Mexico. Over the long term, consistent, compatible safety standards and compliance practices will have the greatest impact in promoting safety, facilitating enforcement, reducing the enforcement burden on the border States, and establishing permanent and stable programs. 

## Proposed Form OP-1(MX) 

The FMCSA proposes extensive revisions to the Form OP-1(MX). The FMCSA proposes to add new sections to solicit additional information from the applicant to assist in identifying the nature of the applicant's existing operations in the U.S., if any. Other sections would help identify any previously submitted Form MCS-150, verify the applicant's domicile in Mexico, and confirm that the applicant holds a valid registration from the Government of Mexico. The question regarding domicile would be removed. However, the proposed question regarding whether the applicant holds a valid registration from the Mexican government is new. It is proposed to ensure that only a carrier who has met Mexican Federal government standards and regulations will operate in the United States. 

The single form for both passenger and property carriers would lessen the paperwork burden on the Mexican applicants and facilitate the inclusion of additional safety questions and certifications. 

Under section 219 of MCSIA, a foreign carrier engaging in transportation in the United States without proper authorization may be disqualified from operating commercial vehicles in the United States. Accordingly, applicants would be asked to disclose whether any affiliated entities have been disqualified. 

                        The proposed form would require an applicant to identify the type(s) of operations requested. The form would make clear that use of the Form OP-1(MX) and issuance of Authority Registrations would be limited to carriers that would operate                         *beyond*                         the municipalities along the United States-Mexico border and commercial zones of such municipalities.                     

Additional information would be requested about insurance held by the carrier. 

The FMCSA proposes to add a new section that would require the applicant to certify that it has a system in place to ensure compliance with applicable requirements covering driver qualifications, hours of service, drug and alcohol testing, vehicle condition, accident monitoring, and hazardous materials transportation. In addition, the FMCSA proposes that the applicant provide narrative responses describing how it will monitor hours of service, how it will maintain an accident register and what is its monitoring program. This section would also require that the applicant provide information including the names of individuals in charge of the applicant's safety program. The applicant must provide: specific locations where the applicant maintains current FMCSRs, the names of the individuals in charge of drug and alcohol testing (if applicable). The FMCSA would require only those safety certifications that apply to the applicant. For example, due to the weight of the vehicles they operate, certain applicants would not be subject to the drug and alcohol testing and CDL requirements in 49 CFR parts 382 and 383, respectively, and would not be required to certify compliance with those regulations. The certification information would enable FMCSA to evaluate, upon initial application, the safety compliance program of the applicant. The FMCSA would reject an applicant that cannot offer a specific, unambiguous plan to ensure compliance. 

The proposed form would require household goods applicants to affirm a willingness to offer arbitration as a means of settling loss and damage claims in accord with U.S. law. 

The FMCSA proposes to add more extensive and specific certifications regarding compliance, including compliance with Department of Labor regulations. Other parts of this certification would require the applicant to affirm its willingness and ability to provide the proposed service and to comply with all pertinent statutory and regulatory requirements. It would remind the applicant of statutory and regulatory responsibilities, which if neglected or violated, might subject the applicant to disciplinary or corrective action by the FMCSA. Another certification, derived from the existing Form OP-2 application, would highlight the need to comply with applicable provisions of the U.S. Internal Revenue Code relating to payment of the Heavy Vehicle Use Tax. An additional certification would ensure that the applicant understands that the agents for service of process designated on the Form BOC-3 would also be deemed the applicant's representative in the United States for service of judicial process and notices under 49 U.S.C. 13304 and administrative notices under 49 U.S.C. 13303. Finally, the applicant would affirm that it is not currently disqualified from operating a commercial motor vehicle in the United States under the provisions of MCSIA. 

The FMCSA will conduct workshops and also provide written material, such as handbooks, to help the Mexican applicants understand the various requirements and the proper way to complete the applications. 

## Proposed Revision to Part 365 

                        The FMCSA proposes to add a new subpart E to part 365 to address the specific requirements of the application process for Mexican carriers. First, proposed § 365.501 sets out that all Mexican-domiciled carriers that want to operate                         *beyond*                         the border area must file the Form OP-1(MX). This would be a change from current practice to facilitate uniform treatment of all Mexican carriers that may wish to offer long haul service, and it is discussed as well in the NPRM concerning part 368 published in today's                         **Federal Register**                        . These special filing rules would                         *not*                         apply to Mexican-owned enterprises domiciled in the United States that want to distribute international cargo within the United States. Nor do they apply to Mexican nationals establishing companies in the United States to provide point-to-point bus services in the United States. Such entities would file either the standard OP-1 or OP-1(P) application form, as appropriate.                     

                        In proposed § 365.503, the FMCSA states that applications must be filled                               ( print page 22374)                            out in English and be complete to be considered. Information on obtaining applications is also provided.                     

We propose in § 365.505 to provide a waiver from the filing fee for two types of applicants. First would be those who submitted an application under the earlier version of the Form OP-1(MX) before the decision of the United States to stay implementation of the NAFTA entry provisions. Second would be those applicants that currently hold a Certificate of Registration and wish to continue operations solely within the U.S. municipalities and commercial zones along the U.S.-Mexico border. 

                        In proposed § 365.507, the FMCSA states that all applications by Mexican carriers would be reviewed under the existing procedures of part 365. Also, we propose that approval of an application would be conditional upon successful completion of a safety review within 18 months. The safety review is discussed in another NPRM published today in the                         **Federal Register**                         (                        *Safety Monitoring System and Compliance Initiative for Mexican Motor Carriers Operating in the United States*).                     

Proposed § 365.509 would include a requirement for Mexican carriers to notify FMCSA in writing of any changes in, or corrections to, applicant information in the Form OP-1(MX) as well as any changes in the Form BOC-3—Designation of Agents—Motor Carriers, Brokers and Freight Forwarders, within 45 days of the change. The proposed requirement would assist FMCSA in keeping its information on Mexican carriers current. The proposed requirement would not be an annual re-filing. A carrier with no change in status would not need to take any action apart from the biennial submission of Form MCS-150. A carrier who fails to update required information may be subject to suspension or revocation of its operating authority. 

Finally, we propose to add the Form OP-1(MX) as Appendix A to subpart E of part 365. 

## Rulemaking Analyses and Notices 

### Executive Order 12866 (Regulatory Planning and Review) and Department of Transportation Regulatory Policies and Procedures 

The FMCSA has determined that this action is a significant regulatory action within the meaning of Executive Order 12866, and is significant within the meaning of Department of Transportation regulatory policies and procedures (44 FR 11034, February 26, 1979). The Office of Management and Budget has reviewed this document. It is anticipated that the economic impact of the proposals in this rulemaking would be minimal. The new or revised Form OP-1(MX), while intended to foster and contribute to safety of operations, adherence to U.S. law and regulations, and compliance with U.S. insurance and tax payment requirements on the part of Mexican carriers, would impose little additional expense upon public agencies or the motoring public. 

                        Nevertheless, the subject of safe operations by Mexican carriers in the United States will likely generate considerable public interest within the meaning of Executive Order 12866. The manner in which the FMCSA carries out its safety oversight responsibilities with respect to this international motor carrier transportation may be of substantial interest to the domestic motor carrier industry, the Congress, and the public at large. A copy of the Regulatory Evaluation prepared for the three companion NPRMs published in today's                         **Federal Register**                         is in the docket.                     

### Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) (Pub. L. 96-354, 5 U.S.C. 601-612), as amended by the Small Business Regulatory Enforcement and Fairness Act (Pub. L. 104-121), requires federal agencies to analyze the impact of rulemakings on small entities, unless the Agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. 

The FMCSA is issuing this NPRM because of the planned implementation of the NAFTA's motor carrier access provisions. A NAFTA dispute resolution tribunal recently ruled that the United States violated NAFTA by failing to allow any Mexican carriers greater access to the United States. 

Mexican carriers would be subject to the same safety regulations as domestic carriers when operating in the U.S. The FMCSA's enforcement of the FMCSRs has become increasingly data dependent in the last several years. Several programs have been put in place to continually analyze crash rates, out-of-service (OOS) rates, compliance review records, and other data sources to allow the agency to focus on high-risk carriers. This strategy is only effective if the FMCSA has adequate data on carriers' size, operations, and history. We do not currently have this type of information on Mexican carriers. We do not have abundant information on their safety record, OOS rates, or other overall safety. Thus, a key component of this proposal is the requirement that carriers with OP-1(MX) authority must complete a Form MCS-150 biennially, and notify the FMCSA of corrections to or changes in applicant information on the Form OP-1(MX) as well as changes in the Form BOC-3 within 45 days of the change. This would enable the FMCSA to better monitor these carriers, and to quickly determine whether their safety or OOS rate changes. 

The objective of this proposal is to help determine the capability of certain Mexican carriers to operate safely in the United States. The proposal describes what additional information Mexican carriers would have to submit. 

This proposal would primarily affect Mexican-domiciled small motor carriers who wish to operate beyond the U.S. municipalities and commercial zones on the U.S.-Mexico border. The amount of information these carriers would have to supply to the FMCSA has been increased, and we estimate that it would take 4 hours to complete each form after compiling the necessary information. 

                        The number of carriers subject to the proposals in this rule and the two companion rules published elsewhere in today's                         **Federal Register**                         is the sum of those currently operating within the United States and those who apply for authority in the future. First, we estimated the number of Mexican carriers already operating within the United States. Most of these carriers currently have operating authority and would merely be required to re-file using the revised forms. To operate in the U.S. beyond the municipalities and commercial zones along the U.S.—Mexico border, as proposed in this rule, carriers would file the revised Form OP-1(MX). To continue operations within the U.S. solely in municipalities and commercial zones along the U.S.—Mexico border, these carriers would file using the revised Form OP-2 (see the rulemaking                         *Revision of Regulations and Application Form for Mexican—Domiciled Motor Carriers to Operate in U.S. Municipalities and Commercial Zones on the U.S.—Mexico Border*                         published elsewhere in today's                         **Federal Register**                        ).                     

                        The FMCSA's Office of Data Analysis and Information Systems developed a file comprised of Mexican carriers that have recently operated in the United States. As of January 2001, this file contained 11,787 Mexican motor carriers (2.3% of the 500,000 carriers listed in the FMCSA Motor Carrier Management Information System (MCMIS) census file). It includes Mexican carriers with operating authority, carriers who have a DOT number but not authority, carriers with both a DOT number and operating                               ( print page 22375)                            authority, and other carriers that the Agency believes are operating in the United States with neither operating authority nor a DOT number. These latter carriers are those who have been subject to a roadside inspection in the United States at some point in the last 3 years.                     

It has been suggested that many of these Mexican carriers no longer operate in the United States. The FMCSA calendar year 2000 MCMIS inspection and accident database identifies approximately 4,500 Mexican motor carriers. The FMCSA also verified that approximately 10,000 Mexican carriers currently have operating authority. Therefore, we constructed three different baseline scenarios for the number of Mexican carriers currently operating in the United States, a low (4,500), medium (9,500) and high (11,787) scenario. 

                        The second step in figuring out the total number of Mexican carriers subject to these proposals is to determine how many                         *new*                         carriers will request authority under the proposals. Approximately 1,600 Mexican carriers have filed an OP-2 form annually over the last several years (and a similar number have been granted). Only 190 OP-1(MX) applications are pending, as Mexican carriers stopped filing these forms when it became clear that these forms were not being processed. For the high estimate, the FMCSA assumes that this number will double to 3,200 the first year this proposal is in effect, and then fall to 2,500 applicants per year for the following 9 years. As in the case of domestic carriers, the annual applicant number may include carriers that go out of business and subsequently re-enter the market. For the lower and middle estimates, we estimate that there will be 500 new applicants the first year, and then 200 per year thereafter. This translates into approximately 15,000 applicants in the first year for the high estimate, 10,000 for the medium estimate, and 5,000 for the low estimate. As was noted above, the FMCSA estimates that more than 500,000 motor carriers are currently operating in the United States.                     

We estimate that it takes 4 hours to complete each form. As was noted above, the vast majority of Mexican motor carriers currently operating in the United States have OP-2 authority. We estimate that half of all these carriers will switch to OP-1(MX) authority, while the other half will continue operating within U.S. municipalities and commercial zones on the U.S.—Mexico border. We assume that the new carriers will be more likely than current carriers to apply for OP-2 authority, since most of the large carriers who would presumably benefit from expanded U.S. operations are already operating in U.S. municipalities and commercial zones on the U.S.—Mexico border under OP-2 authority. While some new applicants will also want to take advantage of the opportunity to operate throughout the United States, many will not have the financial and administrative wherewithal to benefit from the enlarged operations allowed. Accordingly, the Agency estimates that three quarters (75%) of all new applicants will apply for OP-2 authority, with one quarter (25%) requesting OP-1(MX) authority. Nonetheless, changing this value would have no impact on the analysis since the costs of completing the two forms are identical. 

A review of the MCMIS census file reveals that the vast majority of Mexican carriers are small. For Mexican carriers with any trucks, the mean number of trucks was 5.1. That mean was pulled up by a small number of large carriers. Seventy-five (75) percent of Mexican carriers had three or fewer trucks, and the 95th percentile carrier had only 15 trucks. 

These proposals should not have any impact on small U.S. based motor carriers. 

The regulatory evaluation includes a description of the recordkeeping and reporting requirements of these proposals. Under the revised procedures, an applicant would be required to submit a completed Form BOC-3-Designation of Agents—Motor Carriers, Brokers and Freight Forwarders, and Form MCS-150—Motor Carrier Identification Report (Application for U.S. DOT Number) as attachments to the OP-2 or OP-1(MX) application form. In addition, Mexican carriers would update the FMCSA of certain information changes. 

The Form MCS-150 is approximately two pages long. In addition to requiring basic identifying information, it requires that carriers state the type of operation they run, the number of vehicles and drivers they use, and the types of cargo they haul. The Form BOC-3 merely requires the name, address and other information for a domestic agent to be contacted if the FMCSA needs to contact the motor carrier. The proposals also include other modest changes in the OP-1(MX) and OP-2 forms. 

The FMCSA did not propose any different requirements or timetables for small entities. As noted above, we do not believe these requirements would be onerous, with the carriers required to spend 4 hours to complete the relevant forms. Mexican carriers would only be required to complete forms that most domestic U.S. carriers already are required to submit. 

The FMCSA would not consolidate or simplify the compliance and reporting requirements for small carriers. As noted above, small U.S. carriers already have to comply with the similar paperwork requirements of part 365. Given the compelling interest in guaranteeing the safety of Mexican carriers operating in the United States, and the fact that the majority of these carriers are small entities, no special changes were proposed. 

The FMCSA cannot exempt small carriers from these proposals without seriously diminishing the agency's ability to ensure the safe operations of Mexican carriers. The majority of Mexican carriers operating in the U.S. would be small; exempting them would have the same impact as not issuing these proposals. Therefore, FMCSA certifies that this proposed rule would not have a significant impact on a substantial number of small entities. 

### Unfunded Mandates Reform Act of 1995 

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4; 2 U.S.C. 1532) requires each agency to assess the effects of its regulatory actions on State, local, and tribal governments and the private sector. Any agency promulgating a final rule likely to result in a Federal mandate requiring expenditures by a State, local, or tribal government or by the private sector of $100 million or more in any one year must prepare a written statement incorporating various assessments, estimates, and descriptions that are delineated in the Act. The FMCSA has determined that the changes proposed in this rule making would not have an impact of $100 million or more in any one year. 

### Executive Order 12988 (Civil Justice Reform)

This action meets applicable standards in sections 3(a) and 3(b)(2) of E. O. 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. 

### Executive Order 13045 (Protection of Children) 

                        We have analyzed this proposed action under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This proposed rule is not an economically significant rule and does not concern an environmental risk to health or safety that may disproportionately affect children.                               ( print page 22376)    

### Executive Order 12630 (Taking of Private Property) 

This proposed rule will not effect a taking of private property or otherwise have taking implications under E. O. 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. 

### Executive Order 13132 (Federalism) 

This proposed action has been analyzed in accordance with the principles and criteria contained in Executive Order 13132, dated August 4, 1999 (64 FR 43255, August 10, 1999). Consultation with States is not required when a rule is required by statute. The FMCSA, however, has determined that this action would not have significant Federalism implications or limit the policymaking discretion of the States. Comments on this conclusion are welcome and should be submitted to the docket. 

### Executive Order 13166 (Limited English Proficiency) 

Executive Order 13166, “Improving Access to Services for Persons With Limited English Proficiency,” dated August 16, 2000 (65 FR 50121), requires each Federal agency to examine the services it provides and develop reasonable measures to ensure that persons limited in their English proficiency can meaningfully access these services consistent with, and without unduly burdening, the fundamental mission of the agency. The FMCSA plans to provide a Spanish translation of the application instructions incorporated within the Form OP-1(MX) application. We believe that this action complies with the principles enunciated in the Executive Order. 

### Executive Order 12372 (Intergovernmental Review) 

Catalog of Federal Domestic Assistance Program Number 20.217 Motor Carrier Safety. The regulations implementing Executive Order 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this program. 

### Paperwork Reduction Act 

Under the Paperwork Reduction Act of 1995 (PRA) (49 U.S.C. 3501-3520), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct, sponsor, or require through regulations. The FMCSA has determined that this proposal would impact a currently approved information collection, OMB No. 2126-0016. 

This proposal will not have any impact on information collection OMB No. 2126-0015, entitled, “Designation of Agents, Motor Carriers, Brokers and Freight Forwarders.” This currently approved collection covers the Form BOC-3. The current estimates of annual filings include the minimal additional Mexican motor carriers who would be filing updated information on the Form BOC-3. 

The information collection requirements on Form OP-1(MX) have been approved by the OMB under the control number 2126-0016, titled “Revision of Licensing Application Forms, Application Procedures, and Corresponding Regulations.” This approval includes forms OP-1(MX), OP-1(P), OP-1(FF), and OP-1 and totals 38,000 burden hours. Two thousand (2,000) of these 38,000 burden hours represent the approved amount for the OP-1(MX) (1,000 respondents per year @ 2 hours each to complete the form). The FMCSA proposes to change the form title to Form OP-1(MX)—Application to Register Mexican Carriers for Motor Carrier Authority Under the North American Free Trade Agreement (NAFTA).” 

                        The Regulatory Evaluation for this proposal uses a numerical range to estimate the number of Mexican carriers anticipated to request OP-1(MX) or OP-2 authority under this proposal and a companion rule published elsewhere in today's                         **Federal Register**                         (see NPRM titled                         *Revision to Regulations and Application Form for Mexican-Domiciled Motor Carriers to Operate in U.S. Municipalities and Commercial Zones on the U.S.-Mexico Border*). We estimate the number of applicants to range between a low estimate of 5,000, a medium estimate of 10,000 or a high estimate of 15,000 applicants. Please reference the Regulatory Flexibility Act analysis in this document or the Regulatory Evaluation for this rulemaking for a detailed discussion on how these estimates were derived. This analysis is based upon the high estimate (15,000) since that number enables the Agency to assess the maximum information collection burden to respondents.                     

The FMCSA estimates that 11,787 Mexican carriers are currently operating in the United States and are categorized as follows: Mexican carriers operating pursuant to OP-2 Certificates of Registration; Mexican carriers that previously filed an OP-1(MX) application; and Mexican carriers assigned DOT numbers and no OP authority or operating without appropriate authorization. The Agency estimates that half of the 11,787 Mexican carriers (or 5,894) known to be now operating in the U.S. will switch to OP-1(MX) authority, while the other half will continue operating pursuant to OP-2 authority. 

Based upon the high estimate scenario, the FMCSA anticipates 3,200 first-time applicants for either OP-2 or OP-1(MX) authority in the first year that this proposal becomes a final rule, and 2,500 applicants annually in subsequent years. The agency estimates that 25 percent of the first year new applicants (800) would file a Form OP-1(MX); and 25 percent of the subsequent-year new applicants (625 annually) would file a Form OP-1(MX). 

We assume that first-time applicants will be more likely than current carriers to apply for OP-2 authority, since most of the large carriers who would presumably benefit from expanded U.S. operations are already operating in the border commercial zones pursuant to OP-2 authority. While some new applicants may also want to take advantage of the opportunity afforded by this proposal to operate throughout the United States, many will not have the financial and administrative wherewithal or resources to benefit from the enlarged operations allowed. 

This proposal would also require Mexican carriers to submit corrections to or changes in the OP-1(MX) applicant information within 45 days of the change. For changes and updates, the agency anticipates that in the first year, 2,232 carriers would file updates or changes to the Form OP-1(MX). In subsequent years, approximately 208 carriers would file updates or changes to the Form OP-1(MX). The FMCSA estimates that it would take 30 minutes to fill out a form to request changes. 

Therefore, the FMCSA estimates an adjusted burden hour calculation for the Form OP-1(MX) as follows: 

*Mexican carrier re-filings or initial filings of the Form OP-1(MX):*

(in first year, known carriers): 5,894 × 4 hrs per form = 23,576 hrs 

(in first year, first-time applicants): 800 × 4 hrs per form = 3,200 hrs 

(in subsequent-years, first-time applicants): 625 × 4 hrs per form = 2,500 hrs 

*Updates/Changes:*

(all in first year): 2,232 × 30 min. per form = 1,117 hrs 

(all in subsequent years): 208 × 30 min. per form = 104 hrs 

Therefore, proposals in the NPRM, when promulgated as a final rule, would result in a change to the total burden hours for this information collection as follows: 

                        In the first year: 63,893 [(38,000 −2,000 = 36,000) + 26,776 + 1,117]; and                               ( print page 22377)                            in subsequent years: 38,604 [36,000 + 2,500 + 104].                     

*OMB Control Number:*                         2126-0016.                     

*Title:*                         Revision of Licensing Application Forms, Application Procedures, and Corresponding Regulations.                     

*Respondents:*                         Motor carriers that operate CMVs in interstate commerce.                     

*Estimated Annual Hour Burden for this NPRM:*                         Year 1 = ([38,000 −2,000 = 36,000] + 26,776 + 1,117 = 63,893 hrs); Subsequent years = ([38,000 −2,000 = 36,000] + 2,500 + 104 = 38,604 hours).                     

## National Environmental Policy 

                        The agency has analyzed this proposal for the purpose of the National Environmental Policy Act of 1969 (42 U.S.C. 4321*et seq.*) and has determined under DOT Order 5610.1C (September 18, 1979) that this action does not require any environmental assessment. An environmental impact statement is, therefore, not required.                     

# List of Subjects 

### 49 CFR Part 365

      - Administrative practice and procedure
      - Brokers
      - Buses
      - Freight forwarders
      - Maritime carriers
      - Motor carriers
      - Moving of household goods
      - Reporting and recordkeeping requirements

For the reasons stated in the preamble, the FMCSA proposes to amend 49 CFR part 365 as set forth below: 

# PART 365—RULES GOVERNING APPLICATIONS FOR OPERATING AUTHORITY 

1. The authority citation for part 365 is revised to read as follows: 

Authority:5 U.S.C. 553 and 559; 16 U.S.C. 1456; 49 U.S.C. 13101, 13301, 13901-13906, 14708, 31138, and 31144; 49 CFR 1.73.

2. Add a new subpart E to part 365 to read as follows: 

        Subpart E—Special Rules for Certain Mexican Carriers 365.501
Scope of rules. 
365.503
Application. 
365.505
Re-registration and fee waiver for certain applicants. 
365.507
Review of the application. 
365.509
Requirement to notify of change in applicant information. 

        Appendix A to Subpart E of Part 365—Form OP-1(MX) “ Application to Register Mexican Carriers for Motor Carrier Authority Under the North American Free Trade Agreement (NAFTA) 

# Subpart E—Special Rules for Certain Mexican Carriers 

§ 365.501

The rules in this subpart govern the application by a Mexican-domiciled motor carrier to provide transportation of property or passengers in interstate commerce between Mexico and points in the United States beyond the municipalities and commercial zones adjacent to the border. 

§ 365.503

(a) Each applicant applying under this subpart must submit an application that consists of: Form OP-1 (MX), Form MCS-150—Motor Carrier Identification Form, and Form BOC-3—Designation of Agents-Motor Carriers, Brokers and Freight Forwarders. 

(b) The FMCSA will only process your application if it meets the following conditions: 

(1) The application must be completed in English. 

(2) The information supplied must be accurate, complete, and include all required supporting documents and applicable certifications in accordance with the instructions to Form OP-1 (MX), Form MCS-150, and Form BOC-3. 

(3) The application must include the filing fee payable to the FMCSA in the amount set forth at 49 CFR 360.3(f)(1); and 

(4) The application must be signed by the applicant. 

(c) You must submit the application to the address provided in Form OP-1 (MX). 

                                    (d) You may obtain the application forms from any FMCSA Division Office or download it from the FMCSA website at:                                     *http://www.fmcsa.dot.gov/​factsfigs/​formspub.htm. Form OP-1 (MX) is also published in Appendix A to this part.*

§ 365.505

                                    (a) If you filed an application using Form OP-1(MX) before [                                    *Insert date of publication of the final rule in the***Federal Register**                                    ], you are required to file a new Form OP-1(MX) to update information about your operations. You do not need to submit a fee when you file a new application under this subpart.                                 

                                    (b) If you hold a Certificate of Registration issued before [                                    *Insert date of publication of final rule in the***Federal Register**                                    ] authorizing operations beyond the municipalities and commercial zones along the United States-Mexicoan border, you are required to file an OP-1(MX) if you want to continue those operations. You do not need to submit a fee when you file a new application under this subpart.                                 

                                    (1) You must file the application by [                                    *Insert date 1 year after date of publication of final rule in the***Federal Register**                                    .].                                 

(2) The FMCSA may suspend or revoke the Certificate of Registration of any applicable holder that fails to comply with the procedures set forth in this section. 

                                    (3) Certificates of Registration issued prior to [                                    *Insert date of publication of final rule in the***Federal Register**                                    ] would remain valid until the OP-1(MX) application filed according to paragraph (b) of this section is processed.                                 

§ 365.507

(a) The FMCSA will review and act on each application submitted under this subpart in accordance with the procedures set out in this part.

(b) When the FMCSA approves an application submitted under this subpart, the approval will be conditional upon the completion, to the satisfaction of the FMCSA, of a safety review under § 385.21 of this chapter within 18 months of the date of approval. 

§ 365.509

(a) You must notify the FMCSA of any changes or corrections to the information in Parts I, IA or II submitted on the Form OP-1(MX) or the Form BOC-3—Designation of Agents—Motor Carriers, Brokers and Freight Forwarders during the application process or after having been granted operating authority. You must notify the FMCSA in writing within 45 days of the change or correction. 

(b) If you fail to comply with paragraph (a) of this section, the FMCSA may suspend or revoke your operating authority until you meet those requirements. 

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      ( print page 22415)    
Issued on: April 27, 2001.

Brian M. McLaughlin,

Associate Administrator for Policy and Program Development.

BILLING CODE 4910-22-P

[FR Doc. 01-11035 Filed 5-1-01; 8:45 am] 

BILLING CODE 4910-22-C