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Proposed Rule

Fisheries of the Exclusive Economic Zone Off Alaska; Amendment 69 To Revise American Fisheries Act Inshore Cooperative Requirements

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Information about this document as published in the Federal Register.

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AGENCY:

National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

ACTION:

Supplemental proposed rule; request for comments.

SUMMARY:

NMFS proposes additional changes related to an earlier proposed rule to implement Amendment 69 to the Fishery Management Plan for the Groundfish Fishery of the Bering Sea and Aleutian Islands Area (FMP). This proposed amendment would allow an American Fisheries Act (AFA) inshore cooperative to contract with a non-member vessel to harvest a portion of the cooperative's pollock allocation. The North Pacific Fishery Management Council (Council) developed Amendment 69 to provide greater flexibility to inshore catcher vessel cooperatives to arrange for the harvest of their pollock allocation, and to address potential emergency situations, such as vessel breakdowns, that would prevent a cooperative from harvesting its entire allocation. This action is designed to be consistent with the environmental and socioeconomic objectives of the AFA, the Magnuson-Stevens Fishery Management and Conservation Act (Magnuson-Stevens Act), the FMP, and other applicable laws.

DATES:

Comments on the proposed rule must be received on or before October 7, 2002.

ADDRESSES:

Comments must be sent to Sue Salveson, Assistant Administrator, Sustainable Fisheries Division, NMFS, Alaska Region, P.O. Box 21668, Juneau, AK 99802, Attn: Lori Gravel, or delivered to Federal Building, Fourth Floor, 709 West 9th Street, Juneau, AK, and marked Attn: Lori Gravel. Copies of the Regulatory Impact Review/ Initial Regulatory Flexibility Analysis (RIR/IRFA) prepared for Amendment 69 may be obtained from NMFS at the above address. Send comments on collection-of-information requirements to the NMFS, Alaska Region and to the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget (OMB), Washington, DC 20503 (Attn: NOAA Desk Officer). Additional information on the AFA, and the regulations to implement Amendments 61/61/13/8, may be found in the proposed rule to implement Amendments 61/61/13/8, and in the final Environmental Impact Statement prepared for Amendments 61/61/13/8, which is available from NMFS at the addresses noted above.

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FOR FURTHER INFORMATION CONTACT:

Kent Lind, 907-586-7650, or kent.lind@noaa.gov.

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SUPPLEMENTARY INFORMATION:

NMFS manages the groundfish fishery in the exclusive economic zone (EEZ) of the Bering Sea and Aleutian Islands Management Area (BSAI) under the FMP. The Council prepared, and NMFS approved, the FMP under the authority of the Magnuson-Stevens Act (16 U.S.C. 1801 et seq.) and the AFA (Div. C, Title II, Pub. L. No. 105-277, 112 Stat. 2681 (1998)). Regulations implementing the FMP appear at 50 CFR part 679. General regulations governing U.S. fisheries also appear at 50 CFR part 600.

The Council has submitted Amendment 69 for Secretary of Commerce review and a Notice of Availability of the FMP amendment was published in the Federal Register on July 5, 2002 (67 FR 44794), with comments on the FMP amendment invited through September 3, 2002. Comments may address the FMP amendment, the proposed rule, or both, but must be received by September 3, 2002, to be considered in the approval/disapproval decision on the FMP amendment. All comments received by that time, whether specifically directed to the FMP amendment or the proposed rule, will be considered in the approval/disapproval decision on the FMP amendment.

Background Information on the AFA

The AFA established a limited access program for the inshore sector of the BSAI pollock fishery that is based on the formation of fishery cooperatives around each inshore pollock processor. Under the AFA, if at least 80 percent of the catcher vessels that delivered the majority of their BSAI pollock catch to a specific inshore processor during the previous year form a fishery cooperative, and agree to deliver at least 90 percent of its BSAI pollock catch to that same processor, then NMFS must grant the cooperative an exclusive allocation of BSAI pollock based on the member vessels' catch histories from 1995-1997. NMFS issues a single pollock allocation to each cooperative and the cooperative may make sub-allocations of pollock to each individual vessel owner in the cooperative.

All the inshore cooperative agreements implemented to date have provided each member of the cooperative an allocation of pollock that is proportionate to the member vessel's catch history in a manner determined by the cooperative (generally, the best 2 of 3 years from 1995-1997). In effect, the inshore cooperative program functions as a privately run individual fishing quota in which NMFS assigns overall cooperative allocations and each member vessel is granted by the cooperative the exclusive right to harvest its portion of the cooperative's annual pollock allocation. Each cooperative allows its members to harvest their individual allocations or to “lease” their individual allocations to other members of the cooperative.

NMFS first implemented this inshore cooperative allocation program in 2000 through emergency interim rule (65 FR 4520, January 28, 2000). The program was renewed for 2001 with modifications recommended by the Council that allowed inactive vessels to remain eligible to join fishery cooperatives even if they did not fish for pollock during the previous year (66 FR 7327, January 22, 2001) and again in 2002 (67 FR 956, January 8, 2002).

During the time period when the provisions of the AFA were implemented through interim regulations, the Council and NMFS also undertook the development of a comprehensive FMP amendment package to implement the provisions of the AFA on a permanent basis. These amendments to implement the AFA included: Amendment 61 to the Fishery Management Plan for the Groundfish Fishery of the Bering Sea and Aleutian Start Printed Page 54611Islands Area, Amendment 61 to the Fishery Management Plan for Groundfish of the Gulf of Alaska, Amendment 13 to the Fishery Management Plan for Bering Sea and Aleutian Islands King and Tanner Crab, and Amendment 8 to the Fishery Management Plan for the Scallop Fishery off Alaska (Amendments 61/61/13/8). This proposed Amendment 69 would supersede paragraphs 210(b)(1)(B) and 210(b)(5) of the AFA, to the extent that these paragraphs affect the BSAI groundfish fisheries, which would be implemented by Amendments 61/61/13/8 and currently prohibit such contracts with outside vessels. Amendments 61/61/13/8 were partially approved on February 27, 2002, and a proposed rule to implement the amendments, which includes the operating regulations for inshore catcher vessel cooperatives, was published on December 17, 2001 (66 FR 65028).

Additional information on the AFA, and the regulations to implement Amendments 61/61/13/8, may be found in the proposed rule to implement Amendments 61/61/13/8 (66 FR 65028; December 17, 2001), and in the Environmental Impact Statement prepared for Amendments 61/61/13/8, which is available from NMFS (see ADDRESSES).

Purpose and Need for Amendment 69

Several existing regulations and administrative limitations prevent inshore cooperatives from contracting with non-member vessels to harvest a portion of the cooperative's BSAI pollock allocation. First, NMFS recordkeeping and reporting requirements specify that all landings from the BSAI directed pollock fishery that are made by the member vessels of a cooperative must accrue against that cooperative's annual allocation. The NMFS database in its present form automatically assigns a single cooperative code to each AFA catcher vessel (the code representing the cooperative of which the vessel is a member) and therefore precludes a vessel from reporting landings using any different cooperative code during a fishing year. Second, regulations at 50 CFR 679.7(k)(5)(i) prohibit a catcher vessel listed on an AFA inshore cooperative permit to harvest pollock in excess of the cooperative's allocation. This prohibition prevents the member vessels in one cooperative from contracting to harvest a portion of the allocation of another cooperative.

These restrictions, which have the effect of preventing inshore cooperatives from contracting with non-member vessels, are required by subparagraph 210(b)(1)(B) of the AFA, which states:

Effective January 1, 2000. . . upon the filing of a contract implementing a fishery cooperative under subsection (a) which. . . specifies, except as provided in paragraph (6), that such catcher vessels will deliver pollock in the directed pollock fishery only to such shoreside processor during the year in which the fishery cooperative will be in effect and that such shoreside processor has agreed to process such pollock, the Secretary shall allow only such catcher vessels (and catcher vessels whose owners voluntarily participate pursuant to paragraph (2)) to harvest the aggregate percentage of the directed fishing allowance under section 206(b)(1) in the year in which the fishery cooperative will be in effect that is equivalent to the aggregate total amount of pollock harvested by such catcher vessels (and by such catcher vessels whose owners voluntarily participate pursuant to paragraph (2)) in the directed pollock fishery for processing by the inshore component during 1995, 1996, and 1997 relative to the aggregate total amount of pollock harvested in the directed pollock fishery for processing by the inshore component during such years and shall prevent such catcher vessels (and catcher vessels whose owners voluntarily participate pursuant to paragraph (2)) from harvesting in aggregate in excess of such percentage of such directed fishing allowance.

And also by the last sentence of paragraph 210(b)(5) of the AFA which states:

. . .A catcher vessel eligible under section 208(a) the catch history of which has been attributed to a fishery cooperative under paragraph (1) during any calendar year may not harvest any pollock apportioned under section 206(b)(1) in such calendar year other than the pollock reserved under paragraph (1) for such fishery cooperative.

The Council developed Amendment 69 to modify these limitations in response to requests from the inshore pollock industry to provide greater harvest flexibility to members of inshore pollock cooperatives. Amendment 69 has three objectives: (1) Increase efficiency and provide catcher vessel owners with a more functional market for leasing of individual pollock allocations, (2) ensure that an inshore cooperative is able to harvest its entire allocation in the event of vessel breakdowns or other unanticipated emergencies, and (3) improve safety by providing greater flexibility for larger catcher vessels to harvest cooperative allocations during hazardous weather in winter months and when Steller sea lion conservation measures require that fishing be done further offshore.

With respect to the first objective, the AFA currently limits the lease market for pollock quota to only those vessels that are members of the same cooperative. In cooperatives where a substantial number of the vessels are owned or controlled by the associated processor, owners of independent catcher vessels may have limited opportunities to lease quota to other independent vessel owners in the same cooperative. The problem could become even more acute at certain times of the year when only plant-owned vessels are operating. In this hypothetical case, an independent catcher vessel owner could have only one potential customer willing to lease his quota and, therefore, may be in a weak bargaining position. This independent catcher vessel owner likely would benefit from a broader market for his pollock allotment. Efficiency could improve if the vessel that is being contracted to harvest the pollock has lower operating costs than the vessel initially granted use rights to the pollock by the cooperative, depending upon the cost and terms of the lease contract.

With respect to the second objective, under existing regulations, if one or more vessels in a cooperative break down or are otherwise out of commission, and the other vessels in the cooperative are already operating at full capacity, a catcher vessel owner could be unable to contract with a replacement vessel to harvest his portion of the cooperative's pollock allocation. An unexpected emergency such as a dockside fire or accidents that disable or destroy several member vessels of a cooperative at the same time could result in the cooperative being unable to harvest a large portion of its annual allocation. This proposed rule would give cooperatives the means to deal with such emergency situations and facilitate their ability to harvest their entire annual allocations.

With respect to the third objective, safety could be improved if the owners of smaller catcher vessels have greater flexibility to enter into contracts with larger (presumably safer) vessels to harvest the smaller vessel's allocation during the more hazardous weather conditions common during winter months and when Steller sea lion protection measures require that fishing be conducted further offshore. Under existing regulations, the owner of a smaller catcher vessel could be under greater pressure to fish in less than safe conditions if he is unable to contract with larger vessels within his cooperative to harvest some or all of his pollock allocation.

Council Authority to Supersede the AFA

Subsection 213(c) of the AFA provides the Council with the following authority to recommend management Start Printed Page 54612measures to supersede certain provisions of the AFA:

(c) CHANGES TO FISHERY COOPERATIVE LIMITATIONS AND POLLOCK CDQ ALLOCATION. The North Pacific Council may recommend and the Secretary may approve conservation and management measures in accordance with the Magnuson-Stevens Act

(1) that supersede the provisions of this title, except for sections 206 and 208, for conservation purposes or to mitigate adverse effects in fisheries or on owners of fewer than three vessels in the directed pollock fishery caused by this title or fishery cooperatives in the directed pollock fishery, provided such measures take into account all factors affecting the fisheries and are imposed fairly and equitably to the extent practicable among and within the sectors in the directed pollock fishery;

(2) that supersede the allocation in section 206(a) for any of the years 2002, 2003, and 2004, upon the finding by such Council that the western Alaska community development quota program for pollock has been adversely affected by the amendments in this title; or

(3) that supersede the criteria required in paragraph (1) of section 210(b) to be used by the Secretary to set the percentage allowed to be harvested by catcher vessels pursuant to a fishery cooperative under such paragraph.

Any measure recommended by the Council that supersedes a specific provision of the AFA must be implemented by FMP amendment in accordance with the Magnuson-Stevens Act. In developing Amendment 69, the Council determined that all three objectives for Amendment 69 meet the criteria established in paragraph 213(c)(1) of the AFA, which states that the Council may recommend measures that supersede the AFA “to mitigate adverse effects . . . on owners of fewer than three vessels in the directed pollock fishery...”

Elements of the Proposed Rule

The proposed rule to implement Amendment 69 contains the following requirements for inshore cooperatives that wish to contract with non-member vessels to harvest a portion of a cooperative's annual BSAI pollock allocation.

Application process. A cooperative that wishes to contract with a vessel that is a member of another inshore cooperative would be required to complete and submit to NMFS a completed vessel contract form. The form would be provided by NMFS and would require that the cooperative identify the contract vessel, the contact vessel's home cooperative, and describe how pollock landings by the contract vessel are to be assigned between cooperatives. Cooperatives would be allowed to contract with a non-member vessel to fish for the cooperative for a certain period of time, or to harvest a certain tonnage of pollock. The contract form also must indicate how any harvest overages by the contract vessel will be treated. A vessel contract form would not be valid unless it was signed by the cooperative's designated representative, the contracted vessel owner, and the designated representative for the vessel's home cooperative. These signatures are necessary to ensure that all affected parties are in agreement as to the terms of the contract and to avoid any disputes about how a contract vessel's catch is to be attributed.

Fishing for multiple cooperatives. Under the proposed rule, a vessel owner could enter into simultaneous contracts with more than one cooperative. This could occur, for example, at the end of a fishing season when several cooperatives have very small remaining allocations and it is more cost-effective for a single vessel to conduct “mop up” operations for several cooperatives at one time than for each individual cooperative to send a separate vessel to harvest the small remaining tonnages of pollock. If a vessel owner wishes to enter into contracts with more than one cooperative at the same time, then all the affected cooperatives would be required to submit their contract applications together and the contract applications would need to specify how the contracted vessel's harvest and any overages are to be assigned among the various cooperatives.

Recordkeeping and reporting requirements. Inshore processors are currently required to report in their shoreside electronic delivery reports the name and co-op code of each vessel that makes a delivery to that processor. Under the proposed rule, this requirement would not change. However each vessel operator would be obligated to correctly identify for the processor the co-op code that should be assigned to each delivery. In the event that a vessel is making a single delivery on behalf of more than one cooperative, the processor would submit a separate delivery report for each cooperative that identifies the tonnage of pollock that is assigned to each cooperative. Cooperatives would be required to report any contracted landings by non-member vessels on their weekly reports to NMFS. Cooperatives also would be required to provide a summary of all contracted fishing by non-member vessels in their preliminary and final annual reports.

Liability. For the purpose of liability, a non-member vessel under contract to a cooperative would be considered to be a member of the cooperative for the duration of the terms of the contract. This means that the members of the cooperative could be held jointly and severally liable for any fishing violations made by the operator of the contracted vessel.

Effects of contract fishing on future qualification for membership. Under the proposed rule, BSAI pollock landings made by a vessel while under contract to another cooperative would not be used to determine the vessel's qualification for future membership in a cooperative. Only landings attributed to the vessel's home cooperative would be used to determine which cooperative the vessel is eligible to join in a future year. The purpose of this measure is to prevent contracted fishing activity from affecting which cooperative a vessel is eligible to join in the subsequent fishing year.

Classification

At this time, NMFS has not determined that the amendment that this proposed rule would implement is consistent with the national standards of the Magnuson-Stevens Act and other applicable laws. NMFS, in making that determination, will take into account the data, views, and comments received during the comment period.

This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

The Council prepared an initial regulatory flexibility analysis that describes the economic impact this proposed rule, if adopted, would have on small entities. A copy of this analysis is available from NMFS (see ADDRESSES). A description of the action, why it is being considered, and the legal basis for this action are contained at the beginning of the preamble and in the SUMMARY section of the preamble and in the IRFA. Implementation of this proposed rule would involve a modification to an existing form to allow a cooperative to identify a non-member vessel with which the cooperative intends to contact. This modification would have no impact on small entities because the reporting and record-keeping burden would be fulfilled entirely by cooperatives, none of which are small entities. NMFS is aware of no existing relevant Federal rules which duplicate, overlap, or conflict with the proposed rule.

The IRFA concluded that no small entities would be directly affected by this proposed rule. Therefore, it is unlikely that the action would result in a significant adverse impact on a substantial number of directly regulated small entities. The basis for this conclusion is set out below:

A total of 100 inshore catcher vessels, six inshore processors (owning eight Start Printed Page 54613AFA plants), four communities that are home to those processors, 18 communities where the owners of these vessels reside, and other industry support businesses that could be directly or indirectly impacted by the proposed regulations. Only those entities “directly regulated” under the proposed alternatives are appropriately included in the RFA, based upon Small Business Administration (SBA) guidelines for completion of the IRFA and FRFA. SBA guidelines require that affiliated entities be considered as a single entity when making determinations about size. Because all of the vessels that are members of a cooperative are affiliates of the cooperative (which also includes the processor associated with the cooperative), each cooperative itself is considered a single entity for purposes of size determination. Furthermore, because each cooperative has combined gross revenues exceeding $3.5 million, no such cooperative meets the “small entities” criterion for IRFA purposes. In addition to the catcher vessel cooperatives described above, the remaining entities directly affected by this regulation are the eight AFA inshore processors that receive pollock from catcher vessel cooperatives. All of these processors are considered large entities because they exceed the SBA size criterion for fish processing facilities. Therefore, none of the entities directly regulated by this action are considered small entities for IRFA purposes.

All six of the inshore processors are considered large entities because they employ more than 500 people in their worldwide operations. The processors are also affiliated with their associated cooperative's catcher vessel fleet and that would also cause them to be classified as large entities.

None of the communities involved in the BSAI pollock fishery are directly regulated by this proposed amendment. Therefore, they are not appropriately subjects of the IRFA under SBA guidelines.

In conclusion, the Council's preferred alternative would not likely result in a significant adverse impact on a substantial number of directly regulated small entities. This proposed action does not duplicate, overlap, or conflict with other Federal rules and takes into consideration the BSAI groundfish regulations under part 679 in order to be consistent with the objectives of the FMP.

This rule contains a collection-of-information requirement not subject to review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA) because the total universe of respondents is less than 10. Under AFA, the number of inshore cooperatives is limited to no more than 8 because only 8 inshore processors are eligible to process pollock under the AFA and only one cooperative can be associated with each processor. To date, only seven processors have cooperatives associated with them. The eighth processor has not been operating in the BSAI pollock fishery since 1999. Thus, the actual number of respondents is equal to 7 and a theoretical maximum of 8.

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List of Subjects in 50 CFR Part 679

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Alaska, Fisheries, Recordkeeping and reporting requirements.

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Dated: August 15, 2002.

Rebecca Lent,

Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.

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For the reasons set forth in the preamble, the proposed rule amending

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PART 679—FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF ALASKA

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1. The authority citation for 50 CFR part 679 is revised to read as follows:

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Authority: 16 U.S.C. 773 et seq., 1801 et seq., and 3631 et seq.; Title II of Division C, Pub. L. 105-277; Sec. 3027, Pub. L. 106-31, 113 Stat. 57.

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2. In § 679.4, paragraph (l)(6)(ii)(D)(

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Permits.
* * * * *

(l) * * *

(6) * * *

(ii) * * *

(D) * * *

(2) * * *

(iii) Harvests under contract to a cooperative. Any landings made by a vessel operating under contract to an inshore cooperative in which it was not a member will not be used to determine eligibility under this paragraph (l)(6)(ii)(D)(2).

* * * * *
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3. In § 679.7, paragraphs (k)(5)(i) and (k)(5)(ii) are revised to read as follows:

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Prohibitions.
* * * * *

(k) * * *

(5) * * * (i) Quota overages. Use an AFA catcher vessel listed on an AFA inshore cooperative fishing permit, or under contract to the cooperative under § 679.62(c) to harvest non-CDQ pollock in excess of the cooperative's annual allocation of pollock specified under § 679.62.

(ii) Liability. An inshore pollock cooperative is prohibited from exceeding its annual allocation of BSAI pollock TAC. The owners and operators of all vessels listed on the cooperative fishing permit are responsible for ensuring that the operators of all member vessels, and any vessels under contract to the cooperative, comply with all applicable regulations contained in part 679. The owners and operators will be held jointly and severally liable for overages of an annual cooperative allocation, and for any other violation of these regulations committed by a member vessel, or a vessel under contract to the cooperative.

* * * * *
Start Amendment Part

4. In § 679.62. paragraphs (e), (f), and (g) are revised and paragraph (i) is added to read as follows:

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Inshore sector cooperative allocation program.
* * * * *

(e) What are the restrictions on fishing under a cooperative fishing permit? A cooperative that receives a cooperative fishing permit under § 679.4(l)(6) must comply with all of the fishing restrictions set out in this section. The owners and operators of all the member vessels that are named on an inshore cooperative fishing permit and the owners and operators of any vessels under contract to the cooperative under paragraph (c) of this section are jointly and severally responsible for compliance with all of the requirements of a cooperative fishing permit.

(f) What vessels are eligible to fish under an inshore cooperative fishing permit? Only catcher vessels listed on a cooperative's AFA inshore cooperative fishing permit or vessels under contract to the cooperative under paragraph (i) of this section are permitted to harvest any portion of an inshore cooperative's annual pollock allocation.

(g) What harvests accrue against an inshore cooperative's annual pollock allocation? The following catches will accrue against a cooperative's annual pollock allocation regardless of whether the pollock was retained or discarded:

(1) Member vessels. All pollock caught by a member vessel while engaged in directed fishing for pollock in the BSAI by a member vessel unless the vessel is under contract to another cooperative and the pollock is assigned to another cooperative.

(2) Contract vessels. All pollock contracted for harvest and caught by a Start Printed Page 54614vessel under contract to the cooperative under paragraph (c) of this section while the vessel was engaged in directed fishing for pollock in the BSAI.

* * * * *

(i) Contract fishing by non-member vessels. A cooperative that wishes to contract with a non-member vessel to harvest a portion of the cooperative's annual pollock allocation must comply with the following procedures.

(1) How does a cooperative contract with a non-member vessel? A cooperative that wishes to contract with a non-member vessel must submit a completed contract fishing application to the Alaska Region, NMFS, in accordance with the contract fishing application instructions.

(2) What information must be included on a contract fishing application? The following information must be included on a contract fishing application:

(i) Co-op name(s). The names of the cooperative or cooperatives that wish to contract with a non-member vessel

(ii) Designated representative(s). The names and signatures of the designated representatives for the cooperatives that wish to contract with a non-member vessel and the vessel's home cooperative.

(iii) Vessel name. The name and AFA permit number of the contracted vessel

(iv) Vessel owner. The name and signature of the owner of the contracted vessel

(v) Harvest schedule. A completed harvest schedule showing how all catch and any overages by the contracted vessel will be allocated between the contracting cooperative (or cooperatives) and the contract vessel's home cooperative. In the event that multiple cooperatives are jointly contracting with a non-member vessel, the harvest schedule must unambiguously specify how all catch and any overages will be allocated among the various cooperatives.

(3) What vessels are eligible to conduct contract fishing on behalf of an inshore cooperative? Only AFA catcher vessels with an inshore fishing endorsement that are members of an inshore cooperative may conduct contract fishing on behalf of another inshore cooperative.

(4) Who must be informed? A cooperative that has contracted with a non-member vessel to harvest a portion of its inshore pollock allocation must inform any AFA inshore processors to whom the vessel will deliver pollock while under contract to the cooperative prior to the start of fishing under the contract.

(5) How must contract fishing be reported to NMFS? An AFA inshore processor that receives pollock harvested by a vessel under contract to a cooperative must report the delivery to NMFS on the electronic delivery report by using the co-op code for the contracting cooperative rather than the co-op code of the vessel's home cooperative.

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[FR Doc. 02-21457 Filed 8-22-02; 8:45 am]

BILLING CODE 3510-22-S