67364 Federal Register / Vol. 70, No. 214 / Monday, November 7, 2005 / Rules and Regulations 

§ 301.6081–2T Automatic extension of time 

for filing an information return with respect 

to certain foreign trusts (temporary). 

(a) In general. A trust required to file 

a return on Form 3520–A, ‘‘Annual 

Information Return of Foreign Trust 

with a U.S. Owner,’’ will be allowed an 

automatic 6-month extension of time to 

file the return after the date prescribed 

for filing the return if the trust files an 

application under this section in 

accordance with paragraph (b) of this 

section. 

(b) Requirements. To satisfy this 

paragraph (b), a trust must—

(1) Submit a complete application on 

Form 7004, ‘‘Application for Automatic 

6-Month Extension of Time to File 

Certain Business Income Tax, 

Information, and Other Returns,’’ or in 

any other manner prescribed by the 

Commissioner; and 

(2) File the application on or before 

the date prescribed for filing the return 

with the Internal Revenue Service office 

designated in the application’s 

instructions. 

(c) Termination of automatic 

extension. The Commissioner may 

terminate an automatic extension at any 

time by mailing to the trust a notice of 

termination at least 10 days prior to the 

termination date designated in such 

notice. The Commissioner must mail the 

notice of termination to the address 

shown on the Form 7004 or to the trust’s 

last known address. For further 

guidance regarding the definition of last 

known address, see § 301.6212–2 of this 

chapter. 

(d) Penalties. See section 6677 for 

failure to file information returns with 

respect to certain foreign trusts. 

(e) Effective dates. This section is 

applicable for applications for an 

automatic extension of time to file an 

information return with respect to 

certain foreign trusts listed in paragraph 

(a) of this section filed after December 

31, 2005. The applicability of this 

section expires on November 4, 2008. 

Mark E. Matthews, 

Deputy Commissioner for Services and 

Enforcement. 

Approved: October 26, 2005. 

Eric Solomon, 

Acting Deputy Assistant Secretary (for Tax 

Policy). 

[FR Doc. 05–21981 Filed 11–4–05; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF THE TREASURY 

Fiscal Service 

31 CFR Part 210 

RIN 1510–AB04 

Federal Government Participation in 

the Automated Clearing House 

AGENCY: Financial Management Service, 

Fiscal Service, Treasury. 

ACTION: Interim final rule with request 

for comments. 

SUMMARY: This interim final rule 

amends our regulation at 31 CFR part 

210 (Part 210), which governs the use of 

the Automated Clearing House (ACH) 

system by Federal agencies. Part 210 

adopts, with some exceptions, the ACH 

Rules developed by NACHA—The 

Electronic Payments Association 

(NACHA) as the rules governing the use 

of the ACH system by Federal agencies. 

We are issuing this rule to address 

changes that NACHA has made to the 

ACH Rules since the publication of 

NACHA’s 2003 rule book. 

DATES: Comments on the interim final 

rule are due January 6, 2006. This rule 

is effective January 6, 2006. The 

incorporation by reference of the 

publication listed in the rule is 

approved by the Director of the Federal 

Register as of January 6, 2006. 

ADDRESSES: You can download this 

interim final rule at the following Web 

site: http://www.fms.treas.gov/ach. You 

may also inspect and copy this rule at: 

Treasury Department Library, Freedom 

of Information Act (FOIA) Collection, 

Room 1428, Main Treasury Building, 

1500 Pennsylvania Avenue, NW., 

Washington, DC 20220. Before visiting, 

you must call (202) 622–0990 for an 

appointment. 

You can view Treasury’s procedural 

guidelines for ACH payments in the 

Green Book at the following Web site: 

http://www.fms.treas.gov/greenbook. 

You may also register at this Web site 

for e-mail notification of updates to the 

Green Book. 

You may submit comments on the 

rule by any of the following methods. 

You may go to the Government-wide 

rulemaking Web site http:// 

www.regulations.gov and follow the 

instructions for sending your comments 

electronically. Alternatively, you may 

email your comments to FMS at 210 

comments@fms.treas.gov. You may also 

mail your comments to Matthew Friend, 

Financial Management Service, 401 

14th Street, SW., Room 401, 

Washington, DC 20227. 

FOR FURTHER INFORMATION CONTACT: 

Matthew Friend, at (202) 874–1251 or 

matthew.friend@fms.treas.gov; or 

Natalie H. Diana, Senior Counsel, at 

(202) 874–6680 or 

natalie.diana@fms.treas.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

Part 210 governs the use of the ACH 

system by Federal agencies. The ACH 

system is a nationwide electronic fund 

transfer (EFT) system that provides for 

the inter-bank clearing of credit and 

debit transactions and for the exchange 

of information among participating 

financial institutions. Part 210 

incorporates the ACH Rules adopted by 

NACHA, with certain exceptions. From 

time to time we amend part 210 in order 

to address changes that NACHA 

periodically makes to the ACH Rules or 

to revise the regulation as otherwise 

appropriate. 

We are issuing an interim final rule 

amending part 210 to reflect certain 

changes that NACHA has made to the 

ACH Rules since the publication of 

NACHA’s 2003 rule book. We are 

publishing this interim final rule in 

order to indicate which amendments to 

the ACH Rules we are accepting and 

which amendments we are rejecting. 

II. Summary of Rule Changes 

Since 2003, NACHA has published 

two sets of changes to the ACH Rules. 

The first set of changes was published 

in NACHA’s 2004 rule book (2004 ACH 

Rule Book), and the second set of 

changes was published in NACHA’s 

2005 rule book (2005 ACH Rule Book). 

We are adopting all of the rule changes 

except those relating to the audit 

provisions of the ACH Rules, which we 

have previously determined not to 

incorporate in part 210. The rule 

changes that we are adopting are largely 

technical operational changes that will 

have little or no impact on Federal 

agencies’ use of the ACH system. For 

example, the changes discussed below 

to the title and description of Return 

Reason Code R12 and the expansion of 

the Automated Accounting Advice 

Standard Entry Class code are changes 

that we believe are beneficial to the 

ACH system, but that do not 

significantly affect the government’s use 

of the ACH system. In addition, some 

changes merely clarify existing 

provisions of the ACH rules (such as the 

addition of a warranty relating to 

authentication of receivers of InternetInitiated Entries) or impose 

requirements that do not affect or 

change government ACH processes 

(such as ACH Operator and Third Party 

Processor requirements). 

Federal Register / Vol. 70, No. 214 / Monday, November 7, 2005 / Rules and Regulations 67365 

A. Changes to ACH Rules Published in 

2004 ACH Rule Book 

1. Arbitration Procedures. Effective 

December 12, 2003, the ACH Rules 

governing the arbitration process were 

modified to (1) Revise the classifications 

of disputes handled under such 

procedures; (2) establish criteria under 

which participation in an arbitration 

proceeding is mandatory once a dispute 

has been submitted to arbitration; (3) 

revise the number of arbitrators and 

stipends for each arbitration procedure; 

and (4) expand the time frame in which 

a dispute may be submitted for 

arbitration. Arbitration is voluntary 

under the ACH Rules. 

We are adopting these modifications 

to the arbitration provisions of the ACH 

Rules. 

2. Copy of Source Document for 

Accounts Receivable (ARC) Entries. In 

the 2004 ACH Rule Book, NACHA 

published a modification to the rules 

governing ARC entries to eliminate the 

requirement that an Originator retain a 

copy of the back of the source document 

used for an ARC entry. The rule change 

became effective December 12, 2003. We 

are adopting this rule change. We do not 

anticipate that this rule change will 

affect government ARC check 

conversion, since we will continue to 

scan the backs of checks in order to 

make it possible to present an item for 

payment through the check system in 

the event the item cannot be converted 

to an ACH entry. 

3. Operational Efficiency Issues—

Excused Delay. In the 2004 ACH Rule 

Book, NACHA published changes to the 

ACH Rules that clarify that an 

operational outage at a Depository 

Financial Institution (DFI) and ACH 

Operator due to the general failure or 

interruption of communication or 

computer facilities or other equipment 

does not constitute an excused delay. 

This rule became effective March 12, 

2004. We agree that DFIs and ACH 

Operators should have contingency 

backup systems and that a system 

failure should not excuse the DFI or 

ACH Operator from the time limits 

prescribed by the ACH Rules unless the 

system failure is due to circumstances 

beyond their control. Accordingly, we 

are adopting this ACH rule clarification. 

4. Operational Efficiency Issues—

Return Reason Code R12 & Check Serial 

Number XCK in Audit. NACHA 

amended the ACH Rules, effective 

March 12, 2004, to modify the title and 

description of Return Reason Code R12 

from ‘‘Branch Sold to Another DFI’’ to 

‘‘Account Sold to Another DFI’’ to more 

accurately reflect that this code is used 

to return an entry that is destined to a 

specific account that has been sold. The 

amendment also expanded the audit 

provisions of the ACH Rules to require 

a Receiving Depository Financial 

Institution (RDFI) to verify that it 

includes the Check Serial Number of 

XCK entries on the consumer’s bank 

account. We are adopting the 

amendment modifying the title and 

description of Return Reason Code R12. 

We are not adopting the expansion of 

the audit provisions because the audit 

provisions are not incorporated in part 

210 and do not apply to agencies’ use 

of the ACH system. See 31 CFR 

210.2(d)(3); 65 FR 18866 (April 7, 2000). 

5. Operational Efficiency Issues—

Automated Accounting Advices. The 

ACH Rules were modified, effective 

September 10, 2004, to modify the 

Automated Accounting Advice (ADV) 

Standard Entry Class code. The ADV 

Standard Entry Class code is used for an 

optional service offered by ACH 

Operators in which accounting 

information is provided to participating 

DFIs in machine-readable format. The 

amendment expanded the Total Credit 

Entry Dollar Amount and Total Debit 

Entry Dollar Amount Fields within the 

ADV Company/Batch Control Record 

from 12 characters to 20 characters to 

accommodate ADV entries with larger 

dollar values and created a new File 

Control Record that is unique to ADV 

entries. We are incorporating this 

amendment in part 210. 

B. Changes to ACH Rules Published in 

2005 ACH Rule Book 

1. Consumer Opt-Out of ARC Check 

Conversion. Effective June 4, 2004, 

NACHA amended the ACH Rules to 

require Originators of ARC entries to 

allow Receivers to opt out of ARC check 

conversion. Originators must ensure 

that they have established reasonable 

procedures under which Receivers may 

notify Originators that their checks are 

not to be converted to ARC entries. We 

are adopting this amendment. 

FMS provides ARC check conversion 

services for agencies through a 

centralized back-end processing 

operation. We have developed an 

automated process for identifying 

checks that are not to be converted, so 

that those items can be presented for 

payment as checks rather than as ACH 

entries. In order to provide flexibility 

and convenience to the public, we are 

working with agencies to develop 

several ways in which remitters can 

choose to contact the government to 

instruct that their checks not be 

converted, including telephone, fax, email and/or regular mail. Agencies are 

responsible for notifying their remitters 

that they may opt out of ARC check 

conversion and for providing remitters 

with specific opt-out instructions. 

2. ACH Data Security Requirements. 

In the 2005 ACH Rule Book, NACHA 

published an amendment to the ACH 

rules to expand the data security 

requirements by requiring all ACH 

transactions, regardless of the Standard 

Entry Class Code, that involve the 

exchange or transmission of banking 

information via Unsecured Electronic 

Networks to be either (a) encrypted 

using a commercially reasonable 

security technology that, at a minimum, 

is equivalent to 128-bit RC4 encryption 

technology, or (2) transmitted via a 

secure session utilizing a commercially 

reasonable security technology that 

provides a level of security that, at a 

minimum, is equivalent to 128-bit RC4 

encryption technology. Prior to this 

amendment, the ACH Rules defined 

specific data security requirements only 

for Internet-Initiated (WEB) Entries. 

This amendment took effect on 

September 10, 2004. 

We agree that ACH transactions that 

involve the transmission of banking 

information via an Unsecured Electronic 

Network should be subject to data 

security requirements even if the 

Originator obtains information from the 

Receiver by telephone and then keyenters the information via the Internet. 

We are incorporating these requirements 

in part 210. 

3. Returns Issues—ACH Operator 

Requirements. Effective September 10, 

2004, the ACH Rules were amended to 

(1) remove the ACH Operator mandatory 

field error edit on the Original Receiving 

DFI Identification Field within the 

addenda records of dishonored return 

and contested dishonored return entries 

since this field is defined as a required, 

rather than mandatory, field, and (2) 

establish a requirement within the ACH 

Rules that prohibits ACH Operators 

from settling return entries prior to the 

effective entry date in the Company/ 

Batch Header record of the original 

entry, as reflected in the return Entry 

Detail Record. This amendment, which 

generally affects only ACH Operators, 

was developed in order to correct an 

inconsistency in the ACH Rules related 

to the Original Receiving DFI 

Identification Field in the addenda 

records for returns. We do not believe 

that this amendment has any impact on 

agencies or Federal payment recipients. 

We are adopting this amendment. 

4. Third Party Service Provider Issues. 

NACHA amended the ACH Rules, 

effective December 10, 2004, to impose 

specific obligations and processing 

requirements for certain types of ThirdParty Service Providers (referred to as 

‘‘Third-Party Senders’’) that act as 

67366 Federal Register / Vol. 70, No. 214 / Monday, November 7, 2005 / Rules and Regulations 

intermediaries between an Originator 

and an Originating Depository Financial 

Institution (ODFI). We believe it is 

appropriate to establish a legal 

framework within the ACH Rules to 

support a widely-used business practice 

in which some Originators do not have 

agreements directly with the ODFI. We 

are adopting this amendment to the 

ACH Rules. 

5. Internet Issues. Effective March 18, 

2005, NACHA modified the ACH Rules 

to (1) add a new ODFI warranty specific 

to the requirement that an Originator of 

WEB entries use commercially 

reasonable methods of authentication to 

verify the identity of the Receiver, and 

(2) uniquely identify this requirement 

under the Originator’s obligations with 

respect to WEB entries. Prior to this 

modification, the use of verification 

procedures was implicit in the ACH 

Rules but was not set forth as an explicit 

warranty. We are adopting this 

modification to the ACH Rules. 

6. Returns for Unauthorized Debits to 

Consumer Accounts Using a Corporate 

SEC Code. The ACH Rules were 

amended, effective March 18, 2005, to 

reactivate Return Reason Code R05 to 

accommodate the return of 

unauthorized debit entries to consumer 

accounts when those debits were 

transmitted using a corporate Standard 

Entry Class Code. 

We agree that if an Originator 

transmits an ACH entry to a consumer 

account that is erroneously formatted 

using an incorrect SEC Code, the RDFI 

should be permitted to apply the return 

rules and time frames for returning 

unauthorized debits to consumer 

accounts, notwithstanding the incorrect 

SEC Code contained within the entry. 

Accordingly, we are incorporating this 

rule in part 210. 

C. Section-by-Section Analysis 

In order to incorporate in part 210 the 

ACH rule changes that we are accepting, 

the only change necessary to the current 

regulation is to replace references to the 

2003 rule book with references to the 

2005 ACH Rule Book. No change to part 

210 is necessary in order to exclude the 

amendments to the audit provisions, 

since part 210 already provides that the 

ACH audit requirements do not apply to 

Federal agency ACH transactions. 

Section 210.2(d) 

We are amending the definition of 

‘‘applicable ACH Rules’’ at § 210.2(d) to 

reference the rules published in 

NACHA’s 2005 rule book rather than the 

rules published in NACHA’s 2003 rule 

book. There have been changes in the 

numbering of the ACH Rules that are 

reflected in some of the enumerated 

exceptions in § 210.2(d). For example, 

the numbering of the ACH Rules 

governing the reclamation of benefit 

payments that are referenced in 

§ 210.2(d)(4) has changed from ACH 

Rules 2.2.1.8 and 4.7 to ACH Rules 

2.2.1.10 and 4.8, respectively. Other 

numbering changes include: ACH Rule 

2.2.1.12, referenced in § 210.2(d)(3), was 

previously ACH Rule 2.2.1.10; ACH 

Rule 9.3, referenced in § 210.2(d)(5), 

was previously ACH Rule 8.3; and ACH 

Rule 2.10.2.3, referenced in 

§ 210.2(d)(6), was previously ACH Rule 

2.10.2.2. 

Section 210.3(b) 

We are amending § 210.3(b), 

‘‘Incorporation by reference—applicable 

ACH Rules,’’ by replacing the references 

to the ACH Rules as published in the 

2003 rule book with references to the 

ACH Rules as published in the 2005 

rule book. 

Section 210.6 

We are updating several references to 

ACH Rules to reflect numbering changes 

that have been made to the ACH Rules. 

Section 210.8(b) 

We are replacing a reference to ACH 

Rule 7.7.2 with a reference to ACH Rule 

7.7.3 to reflect a numbering change. 

III. Procedural Requirements 

Request for Comment 

We invite comment on all aspects of 

the interim final rule. 

Request for Comment on Plain Language 

On June 1, 1998, the President issued 

a memorandum directing each agency in 

the Executive branch to write its rules 

in plain language. This directive is 

effective for all new proposed and final 

rulemaking documents issued on or 

after January 1, 1999. We invite 

comment on how to make this interim 

final rule clearer. For example, you may 

wish to discuss: (1) Whether we have 

organized the material to suit your 

needs; (2) whether the requirements of 

this interim final rule are clear; or (3) 

whether there is something else we 

could do to make this rule easier to 

understand. 

Notice and Comment; Effective Date 

We find that good cause exists for 

issuing this interim final rule without 

prior notice and comment. Under the 

Administrative Procedure Act, an 

agency is permitted to issue a rule 

without prior notice and comment when 

the agency for good cause finds that 

notice and public procedure thereon are 

impracticable, unnecessary, or contrary 

to the public interest. 5 U.S.C. 553(b)(B). 

We believe that it is important to 

address the publication of new ACH 

Rules as quickly as possible in order to 

mitigate the uncertainty and 

inconvenience to financial institutions 

and agencies that would result from a 

time lag in responding to NACHA’s rule 

changes. When we proposed to address 

changes to the ACH Rules by reviewing 

and responding to rule changes, we 

received many comments expressing 

concern over the potential consequences 

of such a time lag. Those consequences 

include uncertainty as to the rules 

governing government ACH 

transactions, as well as the inability of 

financial institutions to segregate the 

processing of those transactions. For 

these reasons, we find that we have 

good cause for issuing this interim final 

rule without prior notice and comment. 

Nevertheless, we are inviting comment 

and will consider the comments 

received. 

Executive Order 12866, Regulatory 

Planning and Review 

This interim final rule does not meet 

the criteria for a ‘‘significant regulatory 

action’’ as defined in Executive Order 

12866. 

Regulatory Flexibility Act 

Because notice and public comment 

are not required, the Regulatory 

Flexibility Act (5 U.S.C. 601) does not 

apply. 

Paperwork Reduction Act 

This interim final rule contains no 

new collections of information. 

Therefore, the Paperwork Reduction Act 

does not apply. 

List of Subjects in 31 CFR Part 210 

Automated clearing house, Electronic 

funds transfer, Financial institutions, 

Fraud, and Incorporation by reference. 

Authority and Issuance 

■ For the reasons set out in the 

preamble, 31 CFR part 210 is amended 

as follows: 

PART 210—FEDERAL GOVERNMENT 

PARTICIPATION IN THE AUTOMATED 

CLEARING HOUSE 

■ 1. The authority citation for part 210 

continues to read as follows: 

Authority: 5 U.S.C. 5525; 12 U.S.C. 391; 31 

U.S.C. 321, 3301, 3302, 3321, 3332, 3335, and 

3720. 

■ 2. Revise § 210.2(d) to read as follows: 

§ 210.2 Definitions. 

* * * * * 

(d) Applicable ACH Rules means the 

ACH Rules with an effective date on or 

Federal Register / Vol. 70, No. 214 / Monday, November 7, 2005 / Rules and Regulations 67367 

before March 18, 2005, as published in 

Parts II, III, and IV of the ‘‘2005 ACH 

Rules: A Complete Guide to Rules & 

Regulations Governing the ACH 

Network’’: 

(1) ACH Rule 1.1 (limiting the 

applicability of the ACH Rules to 

members of an ACH association); 

(2) ACH Rule 1.2.2 (governing claims 

for compensation); 

(3) ACH Rule 1.2.4; 2.2.1.12; 

Appendix Eight and Appendix Eleven 

(governing the enforcement of the ACH 

Rules, including self-audit 

requirements); 

(4) ACH Rules 2.2.1.10; 2.6; and 4.8 

(governing the reclamation of benefit 

payments); 

(5) ACH Rule 9.3 and Appendix Two 

(requiring that a credit entry be 

originated no more than two banking 

days before the settlement date of the 

entry—see definition of ‘‘Effective Entry 

Date’’ in Appendix Two); 

(6) ACH Rule 2.10.2.3 (requiring that 

originating depository financial 

institutions (ODFIs) establish exposure 

limits for Originators of Internetinitiated debit entries); and 

(7) ACH Rule 2.11.3 (requiring 

reporting regarding unauthorized 

Telephone-initiated entries). 

* * * * * 

■ 3. Revise § 210.3(b) to read as follows: 

* * * * * 

(b) Incorporation by reference—

applicable ACH Rules. 

(1) This part incorporates by reference 

the applicable ACH Rules, including 

rule changes with an effective date on 

or before March 18, 2005, as published 

in Parts II, III, and IV of the ‘‘2005 ACH 

Rules: A Complete Guide to Rules & 

Regulations Governing the ACH 

Network.’’ The Director of the Federal 

Register approves this incorporation by 

reference in accordance with 5 U.S.C. 

552(a) and 1 CFR part 51. Copies of the 

‘‘2005 ACH Rules’’ are available from 

NACHA—The Electronic Payments 

Association, 13665 Dulles Technology 

Drive, Suite 300, Herndon, Virginia 

20171. Copies also are available for 

public inspection at the Office of the 

Federal Register, 800 North Capitol 

Street, NW., Suite 700, Washington, DC 

20002; and the Financial Management 

Service, 401 14th Street, SW., Room 

401, Washington, DC 20227. 

(2) Any amendment to the applicable 

ACH Rules that takes effect after March 

18, 2005, shall not apply to Government 

entries unless the Service expressly 

accepts such amendment by publishing 

notice of acceptance of the amendment 

to this part in the Federal Register. An 

amendment to the ACH Rules that is 

accepted by the Service shall apply to 

Government entries on the effective date 

of the rulemaking specified by the 

Service in the Federal Register notice 

expressly accepting such amendment. 

* * * * * 

§ 210.6 [Amended] 

■ 4. Amend § 210.6 as follows: 

■ a. Amend the first sentence of § 210.6 

by deleting ‘‘7.7.2’’ and inserting 

‘‘8.7.2.’’

■ b. Amend paragraph (g) by deleting 

‘‘3.4’’ and ‘‘3.10’’ and inserting ‘‘3.5’’

and ‘‘3.12,’’ respectively. 

■ c. Amend paragraph (h)(1) by deleting 

‘‘3.6.1’’ and inserting ‘‘3.7.1.’’

■ d. Amend paragraph (h)(2) by deleting 

‘‘3.10’’ and inserting ‘‘3.12.’’

■ e. Amend paragraph (i) by deleting 

‘‘3.4’’ and ‘‘3.10’’ and inserting ‘‘3.5’’

and ‘‘3.12,’’ respectively. 

§ 210.8 [Amended] 

■ 5. Amend paragraph (b) introductory 

text of § 210.8 by deleting ‘‘7.7.2’’ and 

inserting ‘‘8.7.2.’’

Richard L. Gregg, 

Commissioner. 

[FR Doc. 05–22064 Filed 11–4–05; 8:45 am] 

BILLING CODE 4810–35–P 

DEPARTMENT OF DEFENSE 

Department of the Army 

32 CFR Part 581 

RIN 0702–AA51 

Personnel Review Board 

AGENCY: Assistant Secretary of the Army 

for Manpower and Reserve Affairs, DoD. 

ACTION: Final rule. 

SUMMARY: The Department of the Army 

amends its regulation on Army Board 

for Correction of Military Records to be 

in compliance with the United States 

District Court for the District of 

Columbia decision (Daniel J. Lipsman v. 

Secretary of the Army—Civil Action No. 

02–0151 (RMU), Document Nos. 18, 20, 

decided September 7, 2004, 2004 U.S. 

Dist. LEXIS 17866). 

DATES: Effective Date: December 7, 2005. 

ADDRESSES: The Army Review Boards 

Agency, ATTN: SFMR–RBR, 1901 South 

Bell Street, 2nd Floor, Arlington, 

Virginia 22202–4508. 

FOR FURTHER INFORMATION CONTACT: 

Hubert S. Shaw, 703–607–1779. 

SUPPLEMENTARY INFORMATION: 

A. Background 

This rule has previously been 

published. Section 581.3 contained in 

32 CFR part 581 provides Department of 

the Army policy, criteria and 

administrative instructions regarding an 

applicant’s request for the correction of 

a military record. The Administrative 

Procedure Act, as amended by the 

Freedom of Information Act, requires 

that certain policies and procedures and 

other information concerning the 

Department of the Army be published in 

the Federal Register. The policies and 

procedures covered by this part fall into 

that category. The Department of the 

Army received no responses to its notice 

of proposed rule change published on 

August 3, 2005; therefore, no 

substantive changes were made to the 

proposed rule. 

B. Regulatory Flexibility Act 

The Department of the Army has 

determined that the Regulatory 

Flexibility Act does not apply because 

the rule change does not have a 

significant economic impact on a 

substantial number of small entities 

within the meaning of the Regulatory 

Flexibility Act, 5 U.S.C. 601–612. 

C. Unfunded Mandates Reform Act 

The Department of the Army has 

determined that the Unfunded 

Mandates Reform Act does not apply 

because the rule change does not 

include a mandate that may result in 

estimated costs to State, local or tribal 

governments in the aggregate, or the 

private sector, of $100 million or more. 

D. National Environmental Policy Act 

The Department of the Army has 

determined that the National 

Environmental Policy Act does not 

apply because the rule change does not 

have an adverse impact on the 

environment. 

E. Paperwork Reduction Act 

The Department of the Army has 

determined that the Paperwork 

Reduction Act does not apply because 

the rule change does not involve 

collection of information from the 

public. 

F. Executive Order 12630 (Government 

Actions and Interference With 

Constitutionally Protected Property 

Rights) 

The Department of the Army has 

determined that Executive Order 12630 

does not apply because the rule change 

does not impair private property rights. 

G. Executive Order 12866 (Regulatory 

Planning and Review) 

The Department of the Army has 

determined that according to the criteria 

defined in Executive Order 12866 this