54346 Federal Register / Vol. 73, No. 183 / Friday, September 19, 2008 / Proposed Rules 

on http://www.regulations.gov, or by 

appointment, during normal business 

hours, at the Snake River Fish and 

Wildlife Office (see FOR FURTHER

INFORMATION CONTACT). 

Previous Federal Actions 

On July 15, 2002, we published a 

proposed rule (67 FR 46441) to list 

Lepidium papilliferum as endangered 

under the Act (16 U.S.C. 1531 et seq.). 

For a description of Federal actions 

regarding Lepidium papilliferum prior 

to that proposed listing rule, please refer 

to that proposal. Here we provide a 

summary of the Federal actions 

concerning L. papilliferum from the 

2002 proposed listing rule to this action. 

We accepted public comments on the 

July 15, 2002, proposed rule for 60 days, 

until September 13, 2002. We held a 

public hearing on August 29, 2002. On 

September 25, 2002 (67 FR 60206), and 

again on July 18, 2003 (68 FR 42666), 

we reopened the public comment period 

on the proposed listing. On October 30, 

2003, we made a Candidate 

Conservation Agreement (CCA) and a 

document compiled by the Service 

entitled ‘‘Best Available Information for 

Slickspot Peppergrass’’ available for 

public review and comment (68 FR 

61821). On January 22, 2004, we 

published a withdrawal of our proposed 

rule to list Lepidium papilliferum as 

endangered (69 FR 3094). Our 

withdrawal was based on our 

conclusion that evidence of a negative 

population trend was lacking and that 

the formalized conservation plans (e.g., 

the CCA and Integrated Natural 

Resource Management Plans) had 

sufficient certainty that they would be 

implemented and effective such that the 

risk to the species was reduced to a 

level below the statutory definition of 

endangered or threatened. 

On April 5, 2004, the Western 

Watersheds Project filed a complaint 

challenging our decision to withdraw 

the proposed rule to list Lepidium 

papilliferum as endangered (Western 

Watersheds Project v. Jeffery Foss, et al., 

Case No. CV 04–168–S–EJL). On August 

19, 2005, the U.S. District Court for the 

District of Idaho reversed our decision 

to withdraw the proposed rule, 

effectively reinstating our July 15, 2002, 

proposed rule (67 FR 46441). The Court 

remanded the case to the Secretary of 

the Department of the Interior for 

reconsideration of ‘‘whether a proposed 

rule listing the slickspot peppergrass as 

either threatened or endangered should 

be adopted.’’ 

Following the August 19, 2005, 

remand order, we notified Federal, 

State, and local agencies, county 

governments, elected officials, and other 

interested parties of the District Court’s 

decision in a letter dated October 13, 

2005. We requested new scientific data, 

information, and comments about 

Lepidium papilliferum by November 14, 

2005. We also stated that scientific 

information received from the public 

would be utilized in an updated 

document entitled ‘‘Draft Best Available 

Biological Information for Slickspot 

Peppergrass (Lepidium papilliferum)’’ 

(BAI), which would combine all existing 

and new information regarding the 

species and its habitat. We accepted 

information through December 14, 2005, 

and received 13 comment letters in 

response to our request for additional 

information. From February 27, 2006, 

through March 30, 2006, we accepted 

information from peer reviewers and 

others on the draft BAI and on 

conservation efforts for the species. We 

received an additional 36 comments. On 

October 23, 2006, we opened an 

additional 22-day comment period 

through November 13, 2006 (71 FR 

62078) to allow the opportunity for 

public comment on a variety of 

documents, including peer review 

comments on the draft BAI and results 

of an expert panel workshop. We 

received 20 comments in response to 

this request for comments. 

On January 12, 2007, we withdrew 

our proposed rule to list Lepidium 

papilliferum as endangered under the 

Act (72 FR 1621). This withdrawal was 

based on our determination that the best 

available information indicated that, in 

regard to Lepidium papilliferum, ‘‘* * * 

while its sagebrush-steppe matrix 

habitat is degraded, there is little 

evidence of negative impacts on the 

abundance of Lepidium papilliferum, 

which inhabits slickspot microsites 

within this system.’’ The withdrawal 

further concluded that annual 

abundance of the plant is strongly 

correlated with spring precipitation; 

therefore, a high degree of variability in 

annual plant abundance is to be 

expected. Furthermore, evidence 

regarding the plant’s overall population 

trend was inconsistent. 

Subsequently, on April 16, 2007, the 

Western Watersheds Project filed 

another complaint challenging our 

January 2007 decision to withdraw the 

proposed rule to list Lepidium 

papilliferum as endangered (Western 

Watersheds Project v. Jeffery Foss et al., 

Case No. 07–161–E–MHW). 

On June 4, 2008, the U.S. District 

Court for the District of Idaho vacated 

the Service’s January 2007 withdrawal 

of the proposed listing of Lepidium 

papilliferum, and remanded the 

decision to the Service for further 

consideration consistent with the 

Court’s opinion. The Court’s action 

effectively reinstates the July 15, 2002, 

proposed rule to list L. papilliferum as 

endangered (67 FR 46441). The Service 

will complete its review of the best 

available scientific and commercial 

data, including information and 

comments submitted during this 

comment period, as part of the remand 

process. We will then complete a new 

listing determination. 

Author 

The primary authors of this document 

are the staff at the Snake River Fish and 

Wildlife Office (see FOR FURTHER

INFORMATION CONTACT). 

Authority 

The authority for this action is the 

Endangered Species Act of 1973, as 

amended (16 U.S.C. 1531 et seq.). 

Dated: September 10, 2008. 

Kenneth Stansell, 

Acting Director, Fish and Wildlife Service. 

[FR Doc. E8–21987 Filed 9–18–08; 8:45 am] 

BILLING CODE 4310–55–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 680 

[Docket No. 080416577–81187–02] 

RIN 0648–AW73 

Fisheries of the Exclusive Economic 

Zone Off Alaska; Bering Sea and 

Aleutian Islands Crab Rationalization 

Program 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Proposed rule; request for 

comments. 

SUMMARY: NMFS proposes regulations to 

implement Amendment 27 to the 

Fishery Management Plan for Bering 

Sea/Aleutian Islands King and Tanner 

Crabs (FMP). These proposed 

regulations would amend the Crab 

Rationalization Program to: implement 

the statutory requirements of section 

122(e) of the Magnuson-Stevens Fishery 

Conservation and Management 

Reauthorization Act that specifically 

directs NMFS to modify how individual 

processing quota (IPQ) use caps apply to 

a person who is custom processing 

Chionoecetes opilio crab in the North 

Region, clarify that for other crab 

fisheries, IPQ crab that is processed at 

a facility through contractual 


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arrangements with the facility owners 

would not be applied against the IPQ 

use cap of the facility owners provided 

specific conditions are met, and modify 

IPQ use caps that limit the amount of 

IPQ that may be used at a facility by 

persons processing Eastern Aleutian 

Islands golden king crab and Western 

Aleutian Islands red king crab. This 

action is intended to promote the goals 

and objectives of the Magnuson-Stevens 

Fishery Conservation and Management 

Act, the FMP, and other applicable law. 

DATES: Comments must be received no 

later than November 3, 2008. 

ADDRESSES: Send comments to Sue 

Salveson, Assistant Regional 

Administrator, Sustainable Fisheries 

Division, Alaska Region, NMFS, Attn: 

Ellen Sebastian. You may submit 

comments, identified by 0648–AW73, 

by any one of the following methods: 

• Electronic Submissions: Submit all 

electronic public comments via the 

Federal eRulemaking Portal website at 

http://www.regulations.gov. 

• Mail: P. O. Box 21668, Juneau, AK 

99802. 

• Fax: 907–586–7557. 

• Hand delivery to the Federal 

Building: 709 West 9th Street, Room 

420A, Juneau, AK. 

All comments received are a part of 

the public record and will generally be 

posted to http://www.regulations.gov 

without change. All Personal Identifying 

Information (e.g., name, address) 

voluntarily submitted by the commenter 

may be publicly accessible. Do not 

submit Confidential Business 

Information or otherwise sensitive or 

protected information. 

NMFS will accept anonymous 

comments (enter N/A in the required 

fields if you wish to remain 

anonymous). Attachments to electronic 

comments will be accepted in Microsoft 

Word, Excel, WordPerfect, or Adobe 

portable document file (pdf) formats 

only. 

Copies of Amendment 27, the 

Regulatory Impact Review (RIR), the 

Initial Regulatory Flexibility Analysis 

(IRFA), and the categorical exclusion 

prepared for this action, and the 

Environmental Impact Statement (EIS), 

RIR, IRFA, and Social Impact 

Assessment prepared for the Crab 

Rationalization Program are available 

from the NMFS Alaska Region at the 

address above or from the Alaska Region 

website at http://www.fakr.noaa.gov/ 

sustainablefisheries.htm. 

FOR FURTHER INFORMATION CONTACT: 

Glenn Merrill, 907–586–7228. 

SUPPLEMENTARY INFORMATION: The king 

and Tanner crab fisheries in the 

exclusive economic zone of the Bering 

Sea and Aleutian Islands (BSAI) are 

managed under the FMP. The FMP was 

prepared by the North Pacific Fishery 

Management Council (Council) under 

the Magnuson-Stevens Fishery 

Conservation and Management Act 

(Magnuson-Stevens Act) as amended by 

the Consolidated Appropriations Act of 

2004 (Public Law 108–199, section 801). 

A final rule implementing the Crab 

Rationalization Program (Program) 

published on March 2, 2005 (70 FR 

10174). Regulations implementing the 

FMP, and all amendments to the 

Program are at 50 CFR part 680 and 

general regulations related to fishery 

management at 50 CFR part 600. 

Program Overview 

Harvester, Processor, and Community 

Provisions 

The Program established a limited 

access privilege program (LAPP) for 

nine crab fisheries in the BSAI. The 

Program assigned quota share (QS) to 

persons based on their historic 

participation in one or more of those 

nine BSAI crab fisheries during a 

specific time period. Under the 

Program, NMFS issued four types of QS: 

catcher vessel owner (CVO) QS was 

assigned to holders of License 

Limitation Program (LLP) licenses who 

delivered their catch onshore or to 

stationary floating crab processors; 

catcher/processor vessel owner (CPO) 

QS was assigned to LLP holders that 

harvested and processed their catch at 

sea; captains and crew onboard catcher/ 

processor vessels were issued catcher/ 

processor crew (CPC) QS; and captains 

and crew onboard catcher vessels were 

issued catcher vessel crew (CVC) QS. 

Each year, a person who holds QS may 

receive an exclusive harvest privilege 

for a portion of the annual total 

allowable catch (TAC), called individual 

fishing quota (IFQ). 

NMFS also issued processor quota 

share (PQS) under the Program. Each 

year PQS yields an exclusive privilege 

to process a portion of the IFQ in each 

of the nine BSAI crab fisheries. This 

annual exclusive processing privilege is 

called individual processor quota (IPQ). 

Only a portion of the QS issued yields 

IFQ that is required to be delivered to 

a processor with IPQ. QS derived from 

deliveries made by catcher vessel 

owners (i.e., CVO QS) is subject to 

designation as either Class A IFQ or 

Class B IFQ. Ninety percent of the IFQ 

derived from CVO QS is designated as 

Class A IFQ, and the remaining 10 

percent of the IFQ is designated as Class 

B IFQ. Class A IFQ must be matched 

and delivered to a processor with IPQ. 

Class B IFQ is not required to be 

delivered to a specific processor with 

IPQ. Each year there is a one-to-one 

match of the total pounds of Class A IFQ 

with the total pounds of IPQ issued in 

each crab fishery. 

The Class A IFQ and IPQ 

requirements comprise one of three key 

measures currently in regulation to help 

to ensure that catch historically 

delivered to onshore processors 

continues to be delivered to processors 

with historic investment in the fisheries. 

These measures are intended to provide 

economic benefits to processors and 

communities representative of historic 

delivery patterns. In addition to the 

Class A IFQ and IPQ requirements, the 

Program establishes regional delivery 

requirements and a right of first refusal 

for the purchase of PQS and IPQ for 

specific communities. 

Although the Class A IFQ and IPQ 

matching requirements require linkages 

between harvesters and processors, PQS 

and the resulting IPQ can be transferred 

among processors. Therefore, there is no 

guarantee that crab will continue to be 

delivered at the same processing facility 

or community indefinitely. The PQS/ 

IPQ transfer provisions provide 

processors with the ability to 

consolidate processing operations, or 

sell their processing operations to new 

participants, for economic efficiency. 

Limits on the total amount of PQS that 

a person can hold and limits on the total 

amount of IPQ that a person can use 

ensure that no person can receive an 

excessive share of the processing 

capacity. These limits constrain the 

ability of processors to maximize the 

consolidation of processing. 

The second key measure established 

by the Program seeks to ensure that 

communities that were historically 

active as processing ports continue to 

receive socioeconomic benefits from 

crab deliveries through regional delivery 

requirements, commonly known as 

regionalization. Even if processors 

transfer their PQS/IPQ, the Program 

specifies geographic regions where Class 

A IFQ must be delivered, and where IPQ 

must be used to receive that crab. The 

specific geographic regions applicable to 

Class A IFQ and IPQ are based on 

historic geographic delivery and 

processing patterns. Class B, CVC, CPO, 

and CPC IFQ are not subject to 

regionalization. For most crab fisheries, 

CVO QS and the resulting Class A IFQ, 

and PQS and the resulting IPQ, are 

regionally designated for the North 

Region (i.e., north of 54°20′ N. lat.), or 

the South Region (i.e., any location 

south of 54°20′ N. lat.) based on the 

historic delivery and processing 

patterns of a specific CVO QS or PQS 

holder. For one fishery, the Western 


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Aleutian Islands golden king crab 

fishery, half of the Class A IFQ and IPQ 

are designated for the West region, west 

of 174° W. long. and the other half of 

the Class A IFQ and IPQ are not subject 

to a regional designation. Two crab 

fisheries are not subject to 

regionalization requirements, the 

eastern Bering Sea and western Bering 

Sea C. bairdi fisheries. 

The specific North, South, and West 

Region boundaries were selected by the 

Council and implemented in the 

Program to help ensure that deliveries 

continue to specific communities 

historically active as processing centers 

for various crab fisheries. Some of the 

major BSAI crab landing ports include 

the communities of Saint George and 

Saint Paul in the North Region; Akutan, 

Dutch Harbor, False Pass, King Cove, 

Kodiak, and Port Moller in the South 

Region; and Adak and Atka in the West 

Region. Table 1 below shows the nine 

BSAI crab fisheries that are managed 

under the Program, the relative 

proportion of CVO QS and PQS 

assigned to each region, and the 

resulting pounds of Class A IFQ and IPQ 

issued for the 2007/2008 crab fishing 

year and assigned to each region. Due to 

the biology of crab species and the 

traditional pattern of harvesting crab 

between calendar years, IFQ and IPQ is 

assigned for use during a twelve month 

period spanning two calendar years 

called a ‘‘crab fishing year. ’’ The crab 

fishing year begins on July 1 and ends 

on June 30 of the following calendar 

year. Table 1 indicates that a number of 

crab fisheries were not open to fishing 

during the 2007/2008 crab fishing year, 

and therefore no Class A IFQ or IPQ was 

issued for those fisheries. 

TABLE 1: BSAI CRAB FISHERIES, REGIONS, AND ALLOCATIONS OF QS, PQS, CLASS A IFQ, & IPQ. 

Crab fishery Percentage of CVO QS & PQS assigned to 

each region 

Pounds of Class A IFQ & IPQ assigned to 

each region based on the 2007/2008 crab 

fishing year TAC 

Eastern Aleutian Islands golden king crab 

(EAG) 

100 % South 2,243,082 lb. South 

Western Aleutian Islands golden king crab 

(WAG) 

50 % West 

50 % Undesignated 

570,932 lb. West 

569,855 lb. Undesignated 

Western Aleutian Islands red king crab (WAI) 100 % South -- Fishery Not Open -- 

No Class A IFQ or IPQ 

Eastern Bering Sea Tanner crab C. bairdi) 

(EBT) 

100 % Undesignated 2,525,080 lb. Undesignated 

Western Bering Sea Tanner crab (C. bairdi) 

(WBT) 

100 % Undesignated 1,592,952 lb. Undesignated 

Bristol Bay red king crab (BBR) 2.7 % North 

97.3 % South 

388,006 lb. North 

14,893,400 lb. South 

Bering Sea snow crab (C. opilio) (BSS) 47 % North 

53 % South 

21,073,807 lb. North 

23,957,111 lb. South 

Pribilof Islands red and blue king crab (PIK) 67.5 % North 

32.5 % South 

-- Fishery Not Open -- 

No Class A IFQ or IPQ 

St. Matthew blue king crab (SMB) 78.3 % North 

21.7 % South 

-- Fishery Not Open -- 

No Class A IFQ or IPQ 

The third key measure established by 

the Program to protect communities that 

were historically active processing ports 

is a right-of-first-refusal (ROFR) to 

purchase any PQS or IPQ that are 

derived from processing activities in 

those communities. The ROFR 

provision requires that any processor 

who wishes to transfer the PQS or IPQ 

in a specific crab fishery originally 

derived from processing activities in 

specific communities for use outside of 

those communities cannot complete that 

transfer unless they first provide those 

communities an opportunity to 

purchase the PQS or IPQ under the 

same terms and conditions offered to 

the processor to whom they wish to 

transfer those shares. The specific 

communities and fisheries eligible for 

the ROFR are described in detail later in 

this preamble. The intent behind the 

ROFR is to provide communities with 

an option to purchase PQS or IPQ that 

would otherwise be used outside of the 

community. The rationale for the 

specific fisheries and communities 

subject to ROFR requirements is 

described in detail in the EIS prepared 

for the Program (see ADDRESSES). 

Use Caps 

When the Council recommended the 

Program, it expressed concern about the 

potential for excessive consolidation of 

QS and PQS, and the resulting annual 

IFQ and IPQ. Excessive consolidation 

could have adverse effects on crab 

markets, price setting negotiations 

between harvesters and processors, 

employment opportunities for 

harvesting and processing crew, tax 

revenue to communities in which crab 

are landed, and other factors considered 

and described in the EIS prepared for 

the Program (see ADDRESSES). To 

address these concerns, the Program 

limits the amount of QS that a person 

can hold, the amount of IFQ that a 

person can use, and the amount of IFQ 

that can be used onboard a vessel. 

Similarly, the Program limits the 

amount of PQS that a person can hold, 

the amount of IPQ that a person can use, 

and the amount of IPQ that can be 

processed at a given facility. These 

limits are commonly referred to as use 

caps. 

Relevant to this proposed action, in 

each of the nine Program fisheries, a 

person is limited to holding no more 

than an amount equal to 30 percent of 

the PQS initially issued in a given BSAI 

crab fishery and limited to using no 

more than the amount of IPQ resulting 

from 30 percent of the initially issued 


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PQS in a given BSAI crab fishery. In 

addition, no person is permitted to use 

more than 60 percent of the IPQ crab 

issued in the Bering Sea C. opilio fishery 

designated for exclusive use in the 

North Region. Finally, no processing 

facility can be used to process more 

than 30 percent of the IPQ issued for a 

crab fishery. 

The Program is designed to minimize 

the potential for a single person to evade 

the PQS or IPQ use caps through the use 

of corporate affiliations or other legal 

relationships. To do this, the Program 

specifies that the amount of PQS or IPQ 

that applies to a person’s use cap is 

calculated by summing the total amount 

of PQS or IPQ (1) held by that person; 

and (2) held by other persons with PQS 

or IPQ who are ‘‘affiliated’’ with that 

person through common ownership or 

control. In addition, any IPQ crab 

processed at a facility on behalf of an 

IPQ holder who does not own that 

facility through ‘‘custom processing 

arrangements’’ is assigned to the IPQ 

use cap of the facility owner. This 

proposed action is focused primarily on 

modifying the application of IPQ crab 

custom processed at a facility against 

the IPQ use cap of the owner of that 

facility. 

Affiliated Persons and Custom 

Processing Arrangements 

Under the Program, a person is 

considered ‘‘affiliated’’ with another 

person if that person has a 10 percent 

or greater direct or indirect ownership 

interest in the other person (i.e., a 

corporation, partnership, or other 

entity), or that person directs another 

person’s business operations, uses PQS 

or IPQ, or otherwise has the ability to 

control that other person (see 50 CFR 

680.2 for the definition of ‘‘Affiliation’’). 

Attributing all PQS or IPQ held by 

persons linked through affiliation to 

each person in the affiliated group 

limits the ability of corporations to 

consolidate PQS and IPQ and avoid PQS 

and IPQ use caps by owning or 

controlling that PQS or IPQ through 

holding companies or other corporate 

arrangements. In addition, the Program 

limits the amount of consolidation of 

processing activity that occurs at any 

one processing facility. Excessive 

consolidation could limit potential 

markets and reduce processing activities 

in some communities if deliveries of 

crab were consolidated. 

A custom processing arrangement 

exists when one IPQ holder (1) has a 

contract with the owners of a processing 

facility to have his crab processed at 

that facility; (2) does not have an 

ownership interest in the processing 

facility; and (3) is not otherwise 

affiliated with the owners of that crab 

processing facility. In custom processing 

arrangements, the IPQ holder essentially 

contracts with a facility operator to have 

the crab processed according to his 

specifications. Custom processing 

arrangements are typically used when 

one person holds IPQ designated for a 

specific region (e.g., North Region C. 

opilio crab), but does not own a 

shoreside processing facility or cannot 

economically operate a stationary 

floating crab processor in that fishery or 

region. In such a case, a custom 

processing arrangement with the owner 

of a processing facility in that region 

provides an IPQ holder with the 

opportunity to receive Class A IFQ crab 

without having to undertake costly 

measures to establish a physical 

processing facility. 

Amendment 27 

Amendment 27 would accomplish 

three broad goals. First, it would 

establish regulations necessary to 

implement section 122(e) of the 

Magnuson-Stevens Fishery 

Conservation and Management 

Reauthorization Act of 2006 (MSRA) 

which became law on January 12, 2007 

(Public Law 109–479). Second, it would 

modify the methods used to calculate 

and apply use caps when custom 

processing arrangements occur. Third, it 

would establish a limit on the maximum 

amount of processing that may be 

undertaken at processing facilities in the 

Eastern Aleutian Islands golden king 

crab and Western Aleutian Islands red 

king crab fisheries. 

Section 122(e) of the MSRA 

specifically directs NMFS to modify 

how IPQ use caps apply to a person who 

is custom processing Bering Sea C. 

opilio crab in the North Region. Section 

122(e) of the MSRA states: 

(e) USE CAPS.— 

(1) IN GENERAL. — Notwithstanding 

sections 680.42(b)(ii)(2) and 680.7(a)(ii)(7) of 

title 50, Code of Federal Regulations, custom 

processing arrangements shall not count 

against any use cap for the processing of 

opilio crab in the Northern Region so long as 

such crab is processed in the North region by 

a shore-based crab processor. 

(2) SHORE-BASED CRAB PROCESSOR 

DEFINED. — In this paragraph, the term 

‘‘shorebased processor’’ means any person or 

vessel that receives, purchases, or arranges to 

purchase unprocessed crab, that is located on 

shore or moored within the harbor. 

To fully implement section 122(e) of 

the MSRA, NMFS would need to adopt 

conforming regulations. However, 

several of the specific terms used in 

section 122(e), such as ‘‘custom 

processing arrangements’’ and ‘‘moored 

within the harbor, ’’ are not defined in 

the statute or in regulation and no 

legislative history is available to guide 

NMFS on how to interpret those terms. 

In January 2007, NOAA provided 

guidance to the affected industry on 

how it intended to enforce section 

122(e) of the MSRA without the benefit 

of regulations that specifically define 

these terms. NOAA provided this 

guidance with the expectation that the 

Council would subsequently provide 

recommendations to NMFS to amend 

the Program’s regulations after receiving 

additional input from the affected 

industry and community interests. As 

expected, the Council received guidance 

from the public and in December 2007 

adopted recommendations under 

Amendment 27 to revise the Program to 

implement section 122(e) of the MSRA. 

During the process of defining the 

terms required to implement section 

122(e) of the MSRA, participants in 

other crab fisheries expressed concerns 

about the economic viability of their 

fishing operations and advocated IPQ 

use cap exemptions for custom 

processing arrangements similar to 

those congressionally mandated for the 

North Region Bering Sea C. opilio 

fishery be considered in other fisheries. 

Specifically, participants in crab 

fisheries with historically low TAC 

allocations or who are active in crab 

fisheries in more remote regions argued 

that exempting IPQ crab processed 

under custom processing arrangements 

from the IPQ use caps that apply to the 

owners of facilities could improve their 

operational efficiency. 

After reviewing public comments and 

analyzing the BSAI crab fisheries, the 

Council recommended that crab 

delivered to a facility for custom 

processing should be exempt from IPQ 

use caps for specified crab fisheries and 

regions. The Council recommended that 

IPQ crab that is, or had once been, 

subject to ROFR requirements and 

processed in the community from which 

that crab was derived (i.e., the 

community of origin) be exempted from 

the IPQ use cap of the owner of the 

facility where those crab are processed. 

In addition, the Council recommended 

a limit on the amount of IPQ crab that 

could be processed at any one facility in 

the Eastern Aleutian golden king crab 

and Western Aleutian red king crab 

fisheries. In December 2007, the Council 

adopted these recommended changes in 

addition to the clarifications necessary 

to implement section 122(e) of the 

MSRA. This proposed rule would 

implement the Council’s 

recommendations. The following 

section describes the changes that this 


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proposed rule would have on existing 

Program management. 

Proposed Changes to the Program 

This proposed rule would modify or 

add regulations at §§ 680.7(a)(7), 

680.7(a)(8), 680.7(a)(9), 680.42(b)(2), and 

680.42(b)(7). These proposed changes 

would apply as described in the 

following sections of this preamble. 

Exempting custom processing 

arrangements from IPQ use caps 

For certain crab fisheries, this 

proposed rule would remove the 

requirement that NMFS apply any IPQ 

used at a facility through a custom 

processing arrangement against the IPQ 

use cap of the owners of that facility if 

there is no affiliation between the 

person whose IPQ crab is processed at 

that facility and the IPQ holders who 

own that facility. The proposed changes 

to § 680.7(a)(7) would modify the 

calculation of a person’s IPQ use cap to 

be the sum of the IPQ held by that 

person, either directly or indirectly 

through subsidiary corporations, and all 

IPQ held by any IPQ holders affiliated 

with that person. Effectively, this 

change would not count IPQ crab that 

are custom processed at a facility owned 

by an IPQ holder against the IPQ use 

cap of the owner of the processing 

facility. A person who holds IPQ and 

who owns a processing facility would 

be credited only with the amount of IPQ 

crab used by that person, or any 

affiliates of that person, when 

calculating IPQ use caps. 

The following example demonstrates 

how the regulations would be modified 

by this proposed rule. Person A holds 

PQS and IPQ, owns a processing 

facility, and Person A is affiliated with 

four other PQS/IPQ holders (Persons B, 

C, D, and E) through common 

ownership of the companies that hold 

their PQS/IPQ, delivery contracts that 

define how their IPQ will be used, and 

other linkages that create a common 

ownership or control of their PQS or 

IPQ. This proposed rule does not change 

how IPQ use caps apply to a person who 

is affiliated with other persons. 

Therefore, the amount of IPQ that is 

considered to be used by Person A and 

applied to Person A’s use cap is the sum 

of the IPQ held by Person A, and all of 

the IPQ held by Persons B through E 

with whom Person A is affiliated. 

Similarly, the amount of IPQ considered 

to be used by each other person (Persons 

B, C, D, and E) in this commonly 

affiliated group is the sum of the IPQ 

held by all the members (Persons A 

through E) in the group. For this 

example, Persons B through E receive 

their IPQ crab at the facility owned by 

Person A although they are not owners 

of that facility. 

Under this example, a sixth person, 

Person F, establishes a custom 

processing arrangement to have his crab 

processed at the facility owned by 

Person A. Also assume that Person F is 

not an owner of that facility, and is not 

affiliated with Persons A through E. 

Under existing regulations, Person F’s 

use of IPQ is applied against Person A’s 

IPQ use cap because Person A owns a 

ten percent or greater interest in the 

facility where Person F has his crab 

custom processed, even though Person 

A and Person F are not otherwise 

affiliated with each other. Under this 

proposed rule, the IPQ held by Person 

F and custom processed at Person A’s 

facility would not apply to the IPQ use 

cap calculations for Person A. 

In sum, the proposed rule would 

allow processing facility owners who 

also hold IPQ to be able to use their 

facility to establish custom processing 

arrangements with other IPQ holders to 

process more crab at their facilities, 

thereby improving throughput and 

providing a more economically viable 

processing platform. Conceivably, most 

or all of the IPQ crab to which the 

proposed exemption would apply could 

be processed at a single facility 

depending on the degree of affiliation 

that may exist between IPQ holders who 

have an ownership interest in the 

facility and the number of IPQ holders 

that establish custom processing 

arrangements with a given facility 

owner. The affiliation relationships 

among IPQ holders and processing 

facility ownership can change with 

time, so the degree of processing 

consolidation that may occur at a given 

processing facility in a specific crab 

fishery cannot be predicted. 

Removing IPQ crab under custom 

processing arrangement from the facility 

use cap 

The proposed rule would amend the 

regulations at § 680.7(a)(8) so that IPQ 

crab processed under a custom 

processing arrangement would not 

apply against the limit on the maximum 

amount of IPQ crab that can be 

processed at a facility in which no IPQ 

holder has a 10 percent or greater 

ownership interest. Under existing 

regulations, a processing facility cannot 

be used to process more than the 

amount of IPQ resulting from 30 percent 

of the PQS in a fishery if no IPQ holder 

has a 10 percent or greater direct or 

indirect ownership interest in the 

processing facility. The current 

prohibition limits the ability of IPQ 

holders to evade the IPQ use caps and 

process all of their crab at one facility 

by creating a corporate structure where 

the physical processing facility was held 

under one corporation that was not 

linked through common ownership to 

the corporations holding IPQ. The 

proposed rule would effectively remove 

that limit so that more than 30 percent 

of the IPQ could be processed at a 

facility in which no IPQ holder has a 10 

percent or greater direct or indirect 

ownership interest in the processing 

facility, provided those IPQ crab are 

custom processed at that facility. As an 

example, if Person Q owned a 

processing facility but held no IPQ, and 

Persons R and S held IPQ and 

established custom processing 

arrangements with Person Q to have 

their crab processed at his facility, they 

could do so in excess of the 30 percent 

facility use cap. This change would 

allow plant owners to establish custom 

processing arrangements in specific crab 

fisheries. 

Removing IPQ crab under custom 

processing arrangement in the North 

Region C. opilio fishery from IPQ use 

cap calculations 

The proposed rule would modify 

regulations at § 679.42(b)(2) so that IPQ 

crab processed under a custom 

processing arrangement would not 

apply against the IPQ use cap limitation 

that no person can use more than 60 

percent of the Bering Sea C. opilio IPQ 

designated for the North Region. This 

exemption for IPQ crab custom 

processed in the Bering Sea C. opilio 

fishery in the North Region would meet 

the intent of section 122(e) of the MSRA 

to exempt custom processing 

arrangements from this use cap. 

Existing regulations at § 680.7(a)(7) do 

not allow ‘‘an IPQ holder to use more 

IPQ crab than the maximum amount of 

IPQ that may be held by that person. ’’ 

Use of IPQ includes all IPQ held by that 

person and all IPQ crab that are received 

by any Registered Crab Receiver (RCR) 

at any shoreside crab processor or 

stationary floating crab processor in 

which that IPQ holder has a 10 percent 

or greater direct or indirect interest. 

Existing regulations at § 680.42(b) set 

out the specific PQS and IPQ use caps, 

which include (1) a PQS use cap of 30 

percent of the initial PQS pool for all 

crab fisheries; (2) an annual IPQ use cap 

that is equal to the amount of IPQ 

derived from 30 percent of the initial 

PQS pool for each fishery; and (3) an 

annual IPQ use cap of 60 percent for 

north region Bering Sea C. opilio crab. 

To conform to section 122(e) of the 

MSRA, this proposed rule would 

modify § 680.42(b)(2) to allow persons 

holding Bering Sea C. opilio IPQ 

designated for delivery in the North 


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Region to establish custom processing 

arrangements to have their IPQ crab 

processed at a facility. The IPQ crab 

processed under those custom 

processing arrangements would not 

apply against the Bering Sea C. opilio 

use cap of IPQ holders who own the 

facility where those crab are custom 

processed. 

Fisheries subject to custom processing 

arrangement exemption 

The proposed rule would establish 

regulations at § 680.42(b)(7)(ii)(A) that 

list Bering Sea C. opilio with a North 

Region designation, Eastern Aleutian 

Islands golden king crab, Pribilof Island 

blue and red king crab, Saint Matthew 

blue king crab, Western Aleutian golden 

king crab processed west of 174° W. 

long., and Western Aleutian Islands red 

king crab as the six crab fisheries in 

which IPQ crab that are processed under 

a custom processing arrangement would 

not apply against the use cap of IPQ 

holders who own the facility where 

those crab are custom processed. 

The Council determined that 

exempting IPQ crab processed under 

custom processing arrangements from a 

facility owner’s IPQ use cap would 

likely improve processing efficiencies 

without adversely affecting community 

interests. The Council recommended 

that crab that are custom processed in 

the Eastern Aleutian Islands golden king 

crab, Pribilof Island blue and red king 

crab, Saint Matthew blue king crab, and 

Western Aleutian Islands red king crab 

fisheries not apply against the IPQ use 

cap of a processing facility owner 

because these fisheries historically have 

relatively small TACs when they are 

open to fishing, and consolidation of 

processing at one or a few facilities 

would improve the economic efficiency 

of harvesters and processors without 

having an adverse effect on community 

interests within the regions where those 

crab are consolidated. If custom 

processing is not permitted in fisheries 

with small TACs, it may not be 

economically viable for harvesters and 

processors to deliver and process the 

limited catch at multiple facilities. 

These four fisheries are all subject to 

regional designations (see Table 1) and 

processing operations could only 

consolidate within a specific region. 

For the Western Aleutian Islands 

golden king crab fishery, the Council 

recommended exempting IPQ crab 

processed under custom processing 

arrangements from a facility owner’s 

IPQ use cap calculation only if those 

crab were custom processed at facilities 

west of 174° W. long. The Council 

recommended this geographic 

restriction for the exemption based on 

the historic landing patterns in the 

Western Aleutian Islands golden king 

crab fishery, the processing operations, 

and the processing opportunities 

available to the more remote 

communities of Adak and Atka 

compared with those in Akutan and 

Dutch Harbor. The Council concluded 

that granting an exemption to the IPQ 

use cap for IPQ crab custom processed 

west of 174° W. long. could serve to 

attract processing operations to these 

more remote communities. Allowing 

consolidation of IPQ in Adak or Atka 

could entice harvesters to deliver their 

undesignated Western Aleutian Island 

golden king crab west of 174° W. long. 

Presumably, these arrangements 

would be facilitated if harvesters could 

share some of their operational 

efficiency benefits with processors. For 

example, harvesters may accept a lower 

exvessel price for deliveries to Adak or 

Atka in exchange for reduced operating 

costs because vessels would not be 

required to travel from the fishing 

grounds to more distant landing 

facilities (e.g., Dutch Harbor). If the 

custom processing exemption from IPQ 

use caps for Western Aleutian Islands 

golden king crab were not restricted to 

facilities west of 174° W. long., it could 

contribute to the consolidation of 

processing of regionally undesignated 

shares in Dutch Harbor. The Council 

considered the relative impacts of 

processing consolidation on these 

Aleutian Island communities and 

judged that there was a greater need to 

provide additional processing 

efficiencies and harvester incentives to 

communities west of 174° W. long. than 

to communities east of 174° west long. 

given the limited economic 

opportunities available in the more 

remote Aleutian Islands communities. 

The Council did not recommend 

exempting IPQ crab processed under a 

custom processing arrangement from 

applying against the IPQ use cap of a 

facility owner for all crab fisheries. 

Specifically, IPQ crab that are custom 

processed at a facility would continue to 

apply to the use cap of IPQ holders who 

have a 10 percent or greater direct or 

indirect ownership interest in the 

facility when those crab are custom 

processed in the Bristol Bay red king 

crab fishery, Bering Sea C. opilio crab 

fishery with a South Region designation, 

Eastern Bering Sea C. bairdi crab 

fishery, Western Bering Sea C. bairdi 

crab fishery, and Western Aleutian 

Islands golden king crab fishery if those 

IPQ crab were processed east of 174° W. 

long. The Council’s rationale for not 

providing a custom processing 

exemption from the IPQ use caps for 

these fisheries follows. 

First, Bristol Bay red king crab is 

assigned a relatively large TAC; 97.3 

percent of the IPQ is designated for the 

South Region (see Table 1), and the 

Council did not judge that additional 

opportunities for consolidation were 

needed to facilitate economically 

efficient operations among the multiple 

processors in the South Region. Due to 

the limited TAC assigned in the North 

Region, processors can easily 

consolidate processing operations at a 

single facility. Second, Bering Sea C. 

opilio crab with a South Region 

designation also is assigned a relatively 

large TAC, and the ability to deliver to 

multiple processors in the South Region 

reduces the need to exempt custom 

processing arrangements from the use 

cap calculation. The Council did not 

judge that it needed to encourage 

additional consolidation in the 

processing operations for this fishery to 

encourage economically efficient 

processing. Third, Bering Sea C. bairdi 

crab are not subject to regionalization 

and therefore the need to exempt 

custom processing arrangements from 

the IPQ use cap does not appear 

necessary because crab can be 

effectively delivered to any processor 

with matching IPQ in any location. 

Fourth, as explained above, exempting 

Western Aleutian Island golden king 

crab custom processed east of 174° W. 

long. is not necessary given the multiple 

delivery locations available to 

harvesters delivering east of 174° W. 

long. 

Facilities where custom processing 

arrangements are exempt from use caps 

The proposed rule would establish 

regulations at § 680.42(b)(7)(ii)(B) that 

would exempt IPQ crab under custom 

processing arrangements in the crab 

fisheries described in the previous 

section of this preamble and listed 

under the proposed rule at 

§ 680.42(b)(7)(ii)(A) from applying to the 

IPQ use cap of the owner of that facility 

if that facility met specific requirements. 

Consistent with section 122(e) of the 

MSRA, the Council recommended that 

any IPQ crab that were custom 

processed would not count against the 

IPQ use cap of persons holding a 10 

percent or greater direct or indirect 

ownership interest in the facility where 

those IPQ crab were custom processed 

if the facility is: (1) in a home rule, first 

class, or second class city in the State 

of Alaska on the effective date of this 

rule; and (2) either a shorebased crab 

processor (i.e., shoreside), or at a 

stationary floating crab processor that is 

moored within a harbor, at a dock, 

docking facility, or other permanent 


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mooring buoy, with specific provisions 

applicable to the City of Atka. 

The Council recommended that 

facilities would have to be located 

within specific municipal designations 

used by the State of Alaska to ensure 

that the custom processing exemption 

would not serve as an incentive for crab 

to be processed outside of communities 

historically active in crab processing. 

This proposed requirement helps to 

ensure these communities continue to 

receive economic benefits from crab 

processing, including tax revenue, 

employment opportunities, and 

subsidiary benefits that arise from 

processing operations such as additional 

freight service. As described in the 

analysis prepared for this proposed 

action, almost all IPQ crab delivered to 

shoreside or to stationary floating crab 

processors are currently processed in 

home rule, first class, or second class 

cities, and this proposed action would 

not be expected to limit custom 

processing arrangements that are likely 

to occur (see ADDRESSES). This 

requirement would not contravene or 

otherwise be inconsistent with the 

intent of section 122(e) of the MSRA to 

allow custom processing in the Bering 

Sea C. opilio fishery by shoreside 

processors. 

In addition to the requirement that a 

facility be located in a home rule, first 

class, or second class city, the facility 

would need to be a shoreside processor, 

or be a stationary floating crab processor 

that is moored, at a dock, docking 

facility, or other permanent mooring 

buoy located in a harbor within the 

municipal boundaries of the city. An 

exemption to the requirement that a 

stationary floating crab processor must 

be moored within a harbor, at a dock, 

docking facility, or other permanent 

mooring buoy would be provided for the 

City of Atka as described below. 

The requirement that a stationary 

floating crab processor be moored 

within a harbor within city boundaries 

is consistent with the statutory language 

of section 122(e) of MSRA. Although 

section 122(e) applies only to the C. 

opilio fishery in the North Region, the 

Council, with one exception for the City 

of Atka, did not wish to apply different 

standards to the use of stationary 

floating crab processors for purposes of 

applying an IPQ use cap exemption for 

custom processed crab in different crab 

fisheries. NMFS anticipates that a 

uniform standard would reduce 

confusion among fishery participants 

and ease enforcement of this provision. 

Applying a requirement that a 

stationary floating crab processor be 

moored within a harbor would ensure 

that communities would continue to 

benefit economically if the IPQ use cap 

exemption on custom processing were 

approved. Although workers at a 

stationary floating crab processor are 

likely to spend less time on shore and 

in local businesses than shoreside plant 

workers, these floating processor 

workers are likely to occasionally 

frequent local businesses. The use of a 

dock, docking facility, or permanent 

mooring buoy within a harbor to qualify 

for the exemption is likely to ensure 

some use of local services by both the 

processing platform and its employees. 

The Council recommended that a 

stationary floating crab processor would 

not be required to be moored within a 

harbor in the city of Atka. Currently, the 

city of Atka lacks an onshore processing 

facility capable of processing crab 

economically. Additionally, the harbor 

of Nazan Bay, located along the city 

shoreline, has limited docking space 

and lacks permanent mooring facilities. 

These conditions do not appear to exist 

in other cities with substantial history of 

crab processing, and so an exemption to 

the mooring requirements does not 

appear necessary in other communities 

where custom processing is likely to 

occur. By not requiring moorage at 

specific facilities in Nazan Bay, neither 

the City of Atka, nor processors, would 

have to incur the costs of developing 

docks or permanent moorage. It is 

possible that, if a processor chooses to 

process in Atka regularly, that processor 

will choose to either develop the 

onshore processing plant’s capacity to 

handle crab or install docking or 

moorage that will support a stationary 

floating crab processor. Allowing 

processing on stationary floating crab 

processors within the municipal 

boundaries of the city of Atka, but not 

requiring that they be docked or 

permanently moored, could contribute 

to the economic development of the city 

of Atka, and ultimately could encourage 

the development of permanent mooring 

facilities or onshore processing facilities 

in Atka. 

NMFS proposes defining the home 

rule, first class, second class cities and 

the boundaries of those cities in 

existence as of the effective date of the 

rule. Fixing the specific communities 

and their boundaries would facilitate 

compliance with this provision by 

ensuring that future actions by these 

municipalities or the State of Alaska to 

redesignate them or modify their 

boundaries would not have adverse 

effects on processors who are relying on 

the existing municipalities and the 

boundaries of those existing 

municipalities. 

Use cap exemptions for IPQ crab subject 

to ROFR requirements 

The proposed rule would add 

regulations at § 680.42(b)(7)(ii)(C) to 

exempt IPQ crab derived from PQS that 

is, or once was, subject to ROFR 

requirements and that is to be custom 

processed within the boundaries of an 

eligible crab community (ECC) with 

whom the ROFR contract applies, or 

did, apply from the IPQ use cap of the 

owner of the facility where those crab 

are custom processed. Any IPQ crab 

derived from this PQS and custom 

processed within that community 

would be exempt from the IPQ use cap 

of persons who own the crab processing 

facility. 

The Council recommended this 

provision to ensure that if PQS/IPQ has 

been transferred from the initial 

recipients of that PQS/IPQ to another 

person, the ECC with whom the original 

PQS/IPQ holder had a ROFR contract 

could continue to receive the economic 

benefit of having that crab custom 

processed within the community. In 

some instances, the combination of 

consolidation of PQS/IPQ holdings 

among processing companies and the 

application of the IPQ use cap to crab 

custom processed at a facility in these 

ECCs to the owner of that facility could 

limit the retention of processing activity 

in the community from which those IPQ 

were derived. Trends in processing 

capacity consolidation that have 

occurred under the Program, and are 

described in the analysis prepared for 

this proposed action, support this 

requirement (see ADDRESSES). 

The proposed rule would allow IPQ 

crab fisheries that are subject to ROFR 

contract requirements to be custom 

processed at a facility and not applied 

against the IPQ use cap of the facility 

owner only within the eight ECCs with 

current or former ROFR agreements. The 

fisheries subject to ROFR contract 

requirements are the Eastern Aleutian 

Islands golden king crab, Bristol Bay red 

king crab, Bering sea C. opilio crab, 

Pribilof Islands red and blue king crab, 

and St. Matthew blue king crab 

fisheries. The eight ECCs are Akutan, 

Dutch Harbor, False Pass, King Cove, 

Kodiak, Port Moller, Saint George, and 

Saint Paul. The net effect of this 

provision would be to allow 

consolidation of processing through 

custom processing arrangements in 

these specific communities that are 

historically dependent on crab 

processing operations. 

This provision would differ from the 

more general custom processing IPQ use 

cap exemptions in several ways. First, 

processing could only occur within the 


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boundaries of the ECCs. All of the ECCs, 

with the exception of Port Moller, are 

home rule, first class, or second class 

cities under State of Alaska law. Port 

Moller is defined as a census designated 

place with specific boundaries defined 

by the U.S. Census. 

Second, Bristol Bay red king crab as 

well as Bering Sea C. opilio crab 

designated for either the North or the 

South Region could be custom 

processed at facilities within the ECCs 

and would not apply to the IPQ use cap 

of the facility owners. This provision 

would allow ECCs to continue to receive 

the economic benefits from the IPQ 

derived from PQS earned within those 

communities. 

Third, only IPQ derived from PQS 

that is, or was, subject to a ROFR with 

an ECC and transferred to another 

person could be custom processed at a 

facility within that community, and not 

apply to the IPQ use cap of the owner 

of the facility. As an example, if a 

person receives Bristol Bay red king 

crab IPQ by transfer that is, or was, 

derived from PQS subject to a ROFR 

contract in Akutan and custom 

processes those IPQ crab in Sand Point, 

the use of that IPQ would apply against 

the IPQ use cap of the facility owner in 

Sand Point. However, if a person 

received Bristol bay red king crab IPQ 

by transfer that is, or was, derived from 

PQS subject to a ROFR contract in King 

Cove and custom processes those IPQ 

crab in King Cove, those IPQ would not 

apply against the IPQ use cap of the 

facility owner in King Cove. Again, this 

provision would ensure that the relief 

from the IPQ use cap for custom 

processed IPQ crab applies only to IPQ 

crab that are custom processed in the 

ECC that has, or had, a ROFR contract 

on the PQS that gave rise to those IPQ. 

This provision would maintain the 

Council’s goal of providing economic 

benefits to historically active crab 

processing communities. 

Fourth, this provision would not 

require that these IPQ crab be processed 

at specific types of facilities, only that 

the IPQ crab be processed within the 

boundaries of the ECC. This would not 

require the IPQ crab to be processed 

only onshore or on stationary floating 

crab processors that are moored at a 

dock or a permanent mooring buoy in a 

harbor. Crab could be processed at any 

facility onshore or at any stationary 

floating crab processor within the 

boundaries of the eligible crab 

community. The Council did not 

recommend, and this proposed rule 

would not implement, more restrictive 

provisions on the processing facilities 

that could be used when custom 

processing IPQ crab under this 

exemption. The Council did not 

recommend more restrictive facility 

requirements because such 

requirements could limit the ability of 

ECCs to receive benefits that may arise 

from establishing custom processing 

arrangements within their communities. 

IPQ use cap for Eastern Aleutian Islands 

golden king crab and Western Aleutian 

Islands red king crab 

The proposed rule would add 

regulations at § 680.7(a)(9) to prohibit a 

person from processing more than 60 

percent of the IPQ issued for the 

Western Aleutian Islands red king crab 

or Eastern Aleutian Islands golden king 

crab fisheries in a crab fishing year at a 

single processing facility east of 174° W. 

long. This provision would apply to all 

IPQ processed at a shoreside crab 

processor or stationary floating crab 

processor, and would not exempt IPQ 

crab that are delivered under a custom 

processing arrangement from IPQ use 

cap calculations. As noted earlier in this 

preamble, both of these fisheries were 

issued PQS with only a South Region 

designation (see Table 1). Although the 

Western Aleutian Islands red king crab 

fishery is closed, at this time, the 

analysis prepared for this action 

indicates that when it is open for 

fishing, the Western Aleutian Islands 

red king crab fishery has a small TAC 

relative to other BSAI crab fisheries (see 

ADDRESSES). The Council’s intent 

behind this provision was to limit the 

potential consolidation of IPQ that 

could occur under the custom 

processing exemptions proposed under 

this rule. This proposed change to the 

regulation seeks to prevent a potentially 

undesirable consolidation on the 

number of markets available to 

harvesters, a scenario that is more likely 

in these fisheries given their historically 

relatively small TACs compared to other 

crab fisheries. 

In addition, this provision would 

minimize the potentially adverse effects 

on processing facilities west of 174° W. 

long. if all of the IPQ were consolidated 

in processing facilities east of 174° W. 

long. Due to the limited TAC in the 

Eastern Aleutian Islands golden king 

crab fishery, and the currently limited 

number of PQS holders, it is 

conceivable that processing could 

consolidate in one or a few facilities in 

Dutch Harbor or other ports where PQS 

holders in this fishery currently own 

processing facilities. Processors owning 

facilities west of 174° W. long. 

expressed concern about their ability to 

effectively compete in these fisheries if 

all of the catch were processed in one 

facility east of 174° W. long. This 

proposed action would require that a 

minimum of two processing facilities be 

used if Eastern Aleutian Islands golden 

king crab or Western Aleutian Islands 

red king crab were processed east of 

174° W. long. 

Classification 

The Assistant Administrator for 

Fisheries, NMFS, has determined that 

this proposed rule is consistent with 

Amendment 27, the Magnuson-Stevens 

Act and other applicable laws. 

This proposed rule has been 

determined to be not significant for 

purposes of Executive Order 12866. 

An RIR was prepared for this action 

that assesses all costs and benefits of 

available regulatory alternatives. The 

RIR describes the potential size, 

distribution, and magnitude of the 

economic impacts that this action may 

be expected to have. Copies of the RIR 

prepared for this proposed rule are 

available from NMFS. Additionally, an 

IRFA was prepared that describes the 

impact this proposed rule would have 

on small entities. Copies of the RIR/ 

IRFA prepared for this proposed rule are 

available from NMFS (see ADDRESSES). 

The RIR/IRFA prepared for this 

proposed rule incorporates by reference 

an extensive RIR/IRFA prepared for 

Amendments 18 and 19 to the FMP that 

detailed the impacts of the Program on 

small entities. 

The IRFA for this proposed action 

describes in detail the reasons why this 

action is being proposed; describes the 

objectives and legal basis for the 

proposed rule; describes and estimates 

the number of small entities to which 

the proposed rule would apply; 

describes any projected reporting, 

recordkeeping, or other compliance 

requirements of the proposed rule; 

identifies any overlapping, duplicative, 

or conflicting Federal rules; and 

describes any significant alternatives to 

the proposed rule that accomplish the 

stated objectives of the MagnusonStevens Act and any other applicable 

statutes, and that would minimize any 

significant adverse economic impact of 

the proposed rule on small entities. 

The description of the proposed 

action, its purpose, and its legal basis 

are described in the preamble and are 

not repeated here. The directly 

regulated entities under this proposed 

rule are holders of PQS or IPQ. The 

IRFA estimates that currently 29 

persons hold PQS. Eleven of the PQS 

holders are estimated to be large 

entities, leaving 18 small entities that 

would be directly regulated by the 

proposed action. The IRFA notes that 

estimates of the number of small entities 

directly regulated by this proposed 

action are complicated by limited share 


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holder information, and are based on 

available records of employment, 

information on participation in 

processing activities in other fisheries, 

and available knowledge of foreign 

ownership of vertically integrated 

processing companies. The estimate of 

the number of small entities is 

conservative, and may be fewer than 18. 

The proposed rule would not change 

or require additional existing reporting, 

recordkeeping, and other compliance 

requirements. The analysis revealed no 

Federal rules that would conflict with, 

overlap, or be duplicated by the 

alternatives under consideration. 

All of the directly regulated entities 

would be expected to benefit from this 

action relative to the status quo 

alternative because it would relieve 

requirements that limit their ability to 

consolidate processing operations that 

may provide additional benefits relative 

to the status quo. Small entities that 

wish to employ the custom processing 

services of large entities that are 

constrained by the cap, would be able 

to use those services under the custom 

processing exemption under the 

proposed rule. These small entities 

could benefit from an additional market 

for custom processing services that 

might not exist in the absence of the 

custom processing exemption. The IRFA 

notes that a potentially competing effect 

could arise if small entities that wish to 

increase their processing capacity, by 

providing custom processing services, 

were to confront additional competition 

in the market for providing those 

services from large entities who would 

otherwise have been constrained by the 

cap. 

Two alternatives were considered, 

with numerous options and suboptions 

under those alternatives. These options 

and suboptions included analysis of 

various alternatives for the specific 

fisheries subject to custom processing 

exemptions, the types of processing 

facilities at which a custom processing 

exemption could apply, and the amount 

of the IPQ use limitation at a facility for 

Eastern Aleutian Islands golden king 

crab and Western Aleutian Islands red 

king crab. The combinations of these 

options and suboptions under the two 

alternatives effectively provided 

numerous alternatives for analysis. 

Compared with the status quo, the 

proposed action selected by the Council 

would be the alternative that would 

minimize adverse economic impacts on 

the individuals that are directly 

regulated small entities. 

Although the alternatives under 

consideration in this proposed action 

would have distributional and 

efficiency impacts for directly regulated 

small entities, in no case are these 

combined impacts expected to be 

substantial. The status quo alternative 

would not allow the additional 

processing efficiencies that were the 

motivation for the action. However, 

exempting processors from use caps 

under custom processing arrangements 

would provide additional processing 

opportunities for small entities that 

wish to reduce costs by consolidating 

operations with other processors. 

Although neither of the alternatives is 

expected to have any significant 

economic or socioeconomic impacts, the 

preferred Alternative 2 minimizes the 

potential negative impacts that could 

arise under Alternative 1, the status quo 

alternative. 

Collection-of-Information 

This proposed rule does not contain 

a collection-of-information requirement 

subject to review and approval by the 

Office of Management and Budget under 

the Paperwork Reduction Act. 

List of Subjects in 50 CFR Part 680 

Alaska, Fisheries. 

Dated: September 15, 2008. 

Samuel D. Rauch III 

Deputy Assistant Administrator for 

Regulatory Programs, National Marine 

Fisheries Service. 

For the reasons set out in the 

preamble, 50 CFR part 680 is proposed 

to be amended as follows: 

PART 680—SHELLFISH FISHERIES OF 

THE EXCLUSIVE ECONOMIC ZONE 

OFF ALASKA 

1. The authority citation for 50 CFR 

part 680 continues to read as follows: 

Authority: 16 U.S.C. 1862; Pub. L. 108– 

199; Pub. L. 109–241; Pub. L. 109–479. 

2. In § 680.7, paragraphs (a)(7) and 

(a)(8) are revised, and paragraph (a)(9) is 

added to read as follows: 

§ 680.7 Prohibitions. 

* * * * * 

(a) * * * 

(7) For an IPQ holder to use more IPQ 

crab than the maximum amount of IPQ 

that may be held by that person. Use of 

IPQ includes all IPQ held by that 

person, and all IPQ crab that are 

received by any RCR at any shoreside 

crab processor or stationary floating crab 

processor in which that IPQ holder has 

a 10 percent or greater direct or indirect 

ownership interest unless that IPQ crab 

meets the requirements described in 

§ 680.42(b)(7). 

(8) For a shoreside crab processor or 

stationary floating crab processor that 

does not have at least one owner with 

a 10 percent or greater direct or indirect 

ownership interest who also holds IPQ 

in that crab QS fishery, to be used to 

receive in excess of 30 percent of the 

IPQ issued for that crab fishery unless 

that IPQ crab meets the requirements 

described in § 680.42(b)(7). 

(9) For any shoreside crab processor 

or stationary floating crab processor east 

of 174 degrees west longitude to process 

more than 60 percent of the IPQ issued 

in the EAG or WAI crab QS fisheries. 

* * * * * 

3. In § 680.42, paragraph (b)(2) is 

revised, and paragraph (b)(7) is added to 

read as follows: 

§ 680.42 Limitations on use of QS, PQS, 

IFQ and IPQ. 

* * * * * 

(b) * * * 

(2) A person may not use more than 

60 percent of the IPQ issued in the BSS 

crab QS fishery with a North region 

designation during a crab fishing year 

except that a person who: 

(i) Holds IPQ; and 

(ii) Has a 10 percent or greater direct 

or indirect ownership interest in the 

shoreside crab processor or stationary 

floating crab processor where that IPQ 

crab is processed will not be considered 

to use any IPQ in the BSS crab QS 

fishery with a North region designation 

if that IPQ meets the requirements 

described in paragraph (b)(7) of this 

section. 

* * * * * 

(7) Any IPQ crab that is received by 

an RCR will not be considered use of 

IPQ by an IPQ holder who has a 10 

percent or greater direct or indirect 

ownership interest in the shoreside crab 

processor or stationary floating crab 

processor where that IPQ crab is 

processed under § 680.7(a)(7) or 

§ 680.7(a)(8) if: 

(i) That RCR is not affiliated with an 

IPQ holder who has a 10 percent or 

greater direct or indirect ownership 

interest in the shoreside crab processor 

or stationary floating crab processor 

where that IPQ crab is processed; and 

(ii) The following conditions apply: 

(A) The IPQ crab is: 

(1) BSS IPQ crab with a North region 

designation; 

(2) EAG IPQ crab; 

(3) PIK IPQ crab; 

(4) SMB IPQ crab; 

(5) WAG IPQ crab provided that IPQ 

crab is processed west of 174 degrees 

west longitude; or 

(6) WAI IPQ crab; and 

(B) That IPQ crab is processed at 

(1) Any shoreside crab processor 

located within the boundaries of a home 

rule, first class, or second class city in 

the State of Alaska in existence on the 

effective date of this rule; or 


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(2) Any stationary floating crab 

processor that is: 

(i) Located within the boundaries of a 

home rule, first class, or second class 

city in the State of Alaska in existence 

on the effective date of this rule; 

(ii) Moored at a dock, docking facility, 

or at a permanent mooring buoy, unless 

that stationary floating crab processor is 

located within the boundaries of the city 

of Atka in which case that stationary 

floating crab processor is not required to 

be moored at a dock, docking facility, or 

at a permanent mooring buoy; and 

(iii) Located within a harbor, unless 

that stationary floating crab processor is 

located within the boundaries of the city 

of Atka on the effective date of this rule 

in which case that stationary floating 

crab processor is not required to be 

located within a harbor; or 

(C) The IPQ crab is: 

(1) Derived from PQS that is, or was, 

subject to a ROFR as that term is defined 

at § 680.2; 

(2) Derived from PQS that has been 

transferred from the initial recipient of 

those PQS to another person under the 

requirements described at § 680.41; 

(3) Received by an RCR who is not the 

initial recipient of those PQS; and 

(4) Received by an RCR within the 

boundaries of the ECC for which that 

PQS and IPQ derived from that PQS is, 

or was, designated in the ROFR. 

* * * * * 

[FR Doc. E8–21989 Filed 9–18–08; 8:45 am] 

BILLING CODE 3510–22–S 


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