Federal Register / Vol. 61, No. 124 / Wednesday, June 26, 1996 / Rules and Regulations 32925

However, the marking statute and

regulations allow for exceptions to the

marking requirements under certain

circumstances. One of these exceptions

concerns articles which cannot be

marked prior to, or after, importation

except at an expense that would be

economically prohibitive. See 19 U.S.C.

1304(a)(3) (C) and (K), and 19 CFR

134.32(c) and (o). In consideration of:

(1) The fact that many labels for

assembled goods were already printed

prior to July 1, 1996, on the basis of the

current textile origin rules; (2) the

expectation that many individual

requests will be received for marking

exceptions on the ground of economic

prohibitiveness; and (3) the importance

of providing uniformity of Customs

treatment for such goods, Headquarters

has made a general finding that it would

be economically prohibitive to properly

mark goods (either before or after

importation) with respect to which

marking labels have already been preprinted or/or sewn into goods based on

the current origin rules. This action will

allow importers to exhaust their

inventory of pre-existing labels stating

‘‘Assembled in X country from U.S.

components’’ or a similar phrase, for

goods that were assembled from

components that were only cut to shape

in the U.S. (i.e., not woven in the U.S.).

This general marking exception shall be

granted for all imported goods marked

as described above for a period not to

exceed four (4) months from the

effective date of the new textile rule of

origin (i.e., no later than November 1,

1996) which Customs views as a

reasonable period of time for the

exhaustion of existing inventory of

labels. Please note that, if information is

obtained that the above labels were

printed after July 1, 1996, this general

marking exception will not apply.

Dated: June 21, 1996.

Stuart P. Seidel,

Assistant Commissioner, Office of

Regulations and Rulings.

[FR Doc. 96–16278 Filed 6–25–96; 8:45 am]

BILLING CODE 4820–02–P

Drug Enforcement Administration

21 CFR Parts 1309 and 1310

[DEA–133F]

RIN 1117–AA29

Waiver of Requirements for the

Distribution of Prescription Drug

Products Drug Products That Contain

List I Chemicals

AGENCY: Drug Enforcement

Administration (DEA), Justice.

ACTION: Final rule.

SUMMARY: DEA is amending its

regulations to waive the registration

requirement for persons who distribute

prescription drug products that are

subject to regulation on List I chemicals

and to allow that the records required to

be maintained pursuant to the Federal

Food and Drug Administration (FDA)

regulations for prescription drug

products shall be deemed adequate for

satisfying DEA’s recordkeeping

requirements with respect to

distribution. In response from industry,

DEA has conducted a review and

determined that such prescription drug

products are already subject to extensive

regulatory controls regarding their

distribution and there is no evidence

that the products are being diverted at

this time. This action will relieve

distributors and manufacturers of

regulated prescription drug products

containing List I chemicals from the

chemical control requirements in

circumstances where compliance would

be unnecessary for enforcement of the

law.

EFFECTIVE DATE: July 26, 1996.

FOR FURTHER INFORMATION CONTACT:

G. Thomas Gitchel, Chief, Liaison and

Policy Section, Office of Diversion

Control, Drug Enforcement

Administration, Washington, DC 20537,

Telephone (202) 307–7297.

SUPPLEMENTARY INFORMATION: On

September 26, 1995, DEA published a

notice in the Federal Register (60 FR

49527) proposing to amend Title 21,

Code of Federal Regulations (CFR), parts

1309 and 1310, to waive the

requirement of registration for persons

distributing prescription drug products

that are regulated as List I chemicals

and to allow that the records required to

be maintained pursuant to the FDA

regulations for prescription drug

products shall be deemed adequate for

satisfying DEA’s recordkeeping

requirements with respect to

distribution. This rule responds

industry’s requests for relief based on

existing regulatory controls and the lack

of evidence of diversion of the products.

One comments was submitted in

response to the proposed rulemaking.

That comment, while supporting the

proposed amendments, requested that

DEA include in the regulations a

provision that the FDA record retention

requirement of two years, rather that the

four year retention period required

under the Controlled Substances Act

(CSA), would apply to records of

distributions of regulated prescription

drug products. DEA is aware of the

discrepancy between the record

retention requirements between the

FDA and DEA for these products;

however, DEA does not have flexibility

regarding the recordkeeping retention

period for List I chemicals since 21

U.S.C. 830(a)(1)(A) of the CSA mandates

that records of transactions involving

List I chemicals shall be maintained for

four years. There is no provision in the

CSA allowing DEA the discretion to

waive or modify that requirement. Only

the Congress could amend the statute as

proposed by the commentor. Until that

requirement of the law is amended,

records of regulated transactions

involving List I chemicals must be

maintained for the required four year

period.

The Deputy Administrator of the Drug

Enforcement Administration hereby

certifies that this rulemaking will not

have a significant impact on a large

number of entities whose interests must

be considered under the Regulatory

Flexibility Act, 5 U.S.C. 601 et seq. This

rulemaking grants those persons who

distribute regulated prescription drug

products relief from DEA’s chemical

registration requirement and allows for

the use of records already maintained

pursuant to FDA regulations in lieu of

requiring that separate records be

maintained. These amendments could

potentially ease the regulatory burden

for 1,200 or more distributors and

manufacturers of regulated prescription

drug products.

This rule has been drafted and

reviewed in accordance with Executive

Order 12866. DEA has determined that

this is not a significant regulatory action

under the provisions of Executive Order

12866, section 3(f) and accordingly this

rule has not been reviewed by the Office

of Management and Budget. This rule

will eliminate unnecessary regulatory

requirements for distributors of

regulated prescription drug products.

This action has been analyzed in

accordance with the principles an

criteria in Executive Order 12612, and it

has been determined that the rule does

not have sufficient federalism
32926 Federal Register / Vol. 61, No. 124 / Wednesday, June 26, 1996 / Rules and Regulations

implications to warrant the preparation

of a Federalism Assessment.

List of Subjects

21 CFR Part 1309

Administrative practice and

procedure, Drug traffic control, List I

and List II chemicals, Security

measures.

21 CFR Part 1310

Drug traffic control, List I and List II

chemicals, Reporting and recordkeeping

requirements.

For reasons set out above, 21 CFR

parts 1309, and 1310 are amended as

follows:

PART 1309—[AMENDED]

1. The authority citation for part 1309

continues to read as follows:

Authority: 21 U.S.C. 821, 822, 823, 824,

830, 871(b), 875, 877, 958

2. Section 1309.21 is revised to read

as follows:

§ 1309.21 Persons required to register.

(a) Every person who distributes,

imports, or exports any List I chemical,

other than those List I chemicals

contained in a product exempted under

Section 1310.01(f)(1)(iv) of this chapter,

or who proposes to engage in the

distribution, importation, or exportation

of any List I chemical, shall obtain

annually a registration specific to the

List I chemicals to be handled, unless

exempted by law or pursuant to

§§ 1309.24 through 1309.28 of this part.

Only persons actually engaged in such

activities are required to obtain a

registration; related or affiliated persons

who are not engaged in such activities

are not required to be registered. (For

example, a stockholder or parent

corporation of a corporation distributing

List I chemicals is not required to obtain

a registration.)

(b) Every person who distributes or

exports a List I chemical they have

manufactured, other than a List I

chemical contained in a product

exempted under § 1310.01(f)(1)(iv) of

this chapter, or proposes to distribute or

export a List I chemical they have

manufactured, shall obtain annually a

registration specific to the List I

chemicals to be handled, unless

exempted by law or pursuant to

§§ 1309.24 through 1309.28 of this part.

3. Section 1309.22 is amended by

revising paragraph (b) to read as follows:

§ 1309.22 Separate registration for

independent activities.

* * * * *

(b) Every person who engages in more

than one group of independent activities

shall obtain a separate registration for

each group of activities, unless

otherwise exempted by the Act or

Sections 1309.24 through 1309.28 of

this part, except that a person registered

to import any List I chemical shall be

authorized to distribute that List I

chemical after importation, but no other

chemical that the person is not

registered to import.

4. Section 1309.28 is added to read as

follows:

§ 1309.28 Exemption of distributors of

regulated prescription drug products.

(a) The requirement of registration is

waived for any person who distributes

a prescription drug product containing

a List I chemical that is regulated

pursuant to § 1310.01(f)(1)(iv) of this

chapter.

(b) If any person exempted by this

section also engages in the distribution,

importation or exportation of a List I

chemical, other than as described in

paragraph (a) of this section, the person

shall obtain a registration for such

activities, as required by § 1309.21 of

this part.

(c) The Administrator may, upon

finding that continuation of the waiver

granted in paragraph (a) of this section

would not be in the public interest,

suspend or revoke a person’s waiver

pursuant to the procedures set forth in

§ § 1309.43 through 1309.46 and

1309.51 through 1309.57 of this part.

PART 1310—[AMENDED]

5. The authority citation for part 1310

continues to read as follows:

Authority: 21 U.S.C. 802, 830, 871(b)

6. Section 1310.06 is amended by

revising paragraph (b) to read as follows:

§ 1310.06 Content of records and reports.

* * * * *

(b) For purposes of this section,

normal business records shall be

considered adequate if they contain the

information listed in paragraph (a) of

this section and are readily retrievable

from other business records of the

regulated person. For prescription drug

products, prescription and hospital

records kept in the normal course of

medical treatment shall be considered

adequate for satisfying the requirements

of paragraph (a) of this section with

respect to dispensing to patients, and

records required to be maintained

pursuant to the Federal Food and Drug

Administration regulations relating to

the distribution of prescription drugs, as

set forth in 21 CFR part 205, shall be

considered adequate for satisfying the

requirements of paragraph (a) of this

section with respect to distributions.

* * * * *

Dated: May 28, 1996.

Stephen H. Greene,

Deputy Administrator, Drug Enforcement

Administration.

[FR Doc. 96–16299 Filed 6–25–96; 8:45 am]

BILLING CODE 4410–09–M

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 8675]

RIN 1545–AR04

Modifications of Debt Instruments

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Final regulations.

SUMMARY: This document contains final

regulations relating to the modification

of debt instruments. The regulations

govern when a modification is treated as

an exchange of the original debt

instrument for a modified instrument.

The regulations provide needed

guidance to issuers and holders of debt

instruments.

DATES: These regulations are effective

September 24, 1996.

For dates of applicability of these

regulations, see § 1.1001–3(h).

FOR FURTHER INFORMATION CONTACT:

Thomas J. Kelly, (202) 622–3930 (not a

toll-free number).

SUPPLEMENTARY INFORMATION:

Background

On December 2, 1992, proposed

amendments to 26 CFR part 1 were

published in the Federal Register (57

FR 57034) to provide guidance under

§ 1.1001–3. The proposed regulations

relate to the modification of debt

instruments. On February 17, 1993, the

IRS held a public hearing on the

proposed regulations. In addition, the

IRS received numerous written

comments on the proposed regulations.

The proposed regulations, with certain

changes made in response to comments,

are adopted in this Treasury decision as

final regulations. The principal changes

to the regulations, as well as the major

comments and suggestions, are

discussed below.

Explanation of Provisions

A. General

The preamble to the proposed

regulations states that the proposed