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Fisheries Off West Coast States and in the Western Pacific; Coastal Pelagic Species Fishery; Amendment 10

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Start Preamble


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


Final rule.


NMFS issues a regulation to implement Amendment 10 to the Coastal Pelagic Species (CPS) Fishery Management Plan (FMP), which was submitted by the Pacific Fishery Management Council (Council) for Start Printed Page 3820review and approval by the Secretary of Commerce. Amendment 10 addresses the two unrelated subjects of the transferability of limited entry permits and maximum sustainable yield (MSY) for market squid. Only the provisions regarding limited entry permits require regulatory action. The primary purpose of this final rule is to establish the procedures by which limited entry permits can be transferred to other vessels and/or individuals so that the holders of the permits have maximum flexibility in their fishing operations while the goals of the FMP are achieved.


Effective January 27, 2003, except for § 660.512(h), which is effective February 26, 2003.


Copies of Amendment 10, which includes an environmental assessment/regulatory impact review, and determination of the impact on small businesses may be obtained from Donald O. McIssac, Executive Director, Pacific Fishery Management Council, 7700 NE Ambassador Place, Suite 200, Portland, OR 97220. Comments regarding the collection-of-information requirements contained in this rule should be sent to Rodney R. McInnis, Acting Regional Administrator, Southwest Region, NMFS, 501 West Ocean Blvd., Suite 4200, Long Beach, CA 90802-4213, and to the Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Washington, DC 20503 (ATTN: NOAA Desk Officer).

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James Morgan, Sustainable Fisheries Division, NMFS, at 562-980-4036.

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The Council distributed a draft of Amendment 10 for public review on April 22, 2002. At its June 2002 meeting, the Council reviewed written comments, received comments from its advisory bodies, and heard public comments. On October, 3, 2002, a notice of availability of Amendment 10 and the associated documents was published in the Federal Register (67 FR 62001). A proposed rule was published in the Federal Register on October 30, 2002 (67 FR 66103), requesting public comment. The comment period ended on December 16, 2002. Two letters were received. Amendment 10 was approved by NMFS on December 30, 2002.


On June 10, 1999, Amendment 8 to the Northern Anchovy Fishery Management Plan, which was renamed the Coastal Pelagic Species Fishery Management Plan, was partially approved by the Secretary of Commerce. Two of the provisions of Amendment 8 were disapproved. However, these two provisions addressed matters required by the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) to be included in all fishery management plans. As such, the Council was required to revisit these issues in subsequent actions. First, bycatch provisions of Amendment 8 were disapproved because they did not contain a standardized reporting methodology to assess the amount and type of bycatch in the fishery. Bycatch requirements of the Magnuson-Stevens Act were eventually addressed in Amendment 9, which was approved on March 22, 2001. Second, optimum yield for market squid (Loligo opalescens) was disapproved because Amendment 8 did not provide an estimate of MSY. The Council is addressing MSY through submission of Amendment 10.

Market Squid

Various approaches to determine an MSY proxy for market squid have been attempted. With little knowledge of the biology of squid and inadequate data available, other than landings, results from all methods used to determine an or proxy for MSY proved to be ineffective for monitoring the resource. Amendment 10, which contains a description of these methods, examines such things as historical landings, the range of the species, and the manner in which the fishery is conducted.

Additional data on squid became available from research conducted by the California Department of Fish and Game through a program implemented by State legislation establishing permit fees to fund squid research. With new information on growth, maturity, and fecundity, the Council implemented a scientific review, which resulted in the development of a proxy for MSY that came to be known as the egg escapement (EE) method. A discussion of the approach the Council used was published in the proposed rule and will not be repeated here.

The EE method is based on a modeling approach that addresses the life history of the species, with a focus on the mortality and spawning rates of sexually mature females and is based on determining a sustainable level of egg escapement. A sustainable level of egg escapement can be practically interpreted as a level of reproductive (egg) escapement that is believed to be at or near a minimum level necessary to allow the population to maintain its level of abundance into the future, that is, allow for sustainable reproduction year after year.

With the approval of Amendment 10, the FMP now uses the EE method to monitor the market squid fishery. The adoption of the EE method for this purpose does not require implementing rules because it sets a policy for monitoring the fishery and has no direct effect on the conduct of the fishery.

Capacity Goal

Amendment 10 establishes a capacity goal for the fleet and sets conditions for the transfer of permits to maintain the capacity goal. The purpose of the capacity goal is to ensure that fishing capacity in the CPS limited entry fishery is in balance with resource availability. Measuring the actual harvesting capacity of a vessel and monitoring each vessel's capacity can be complicated because the amount of fish a vessel can carry depends on many factors; therefore, Amendment 10 uses an aggregate gross tonnage (GT) of 5,650.9 mt as a proxy for fleet capacity. The aggregate gross tonnage level of 5,650.9 mt results in a fleet that is larger than necessary solely to harvest available CPS; however, the CPS finfish fleet also relies on other fishing opportunities such as fishing for squid and tuna. The current fleet of 65 vessels, which totals 5,650.9 mt GT, meets the necessity of controlling the size of the CPS fleet while taking in consideration the economic needs of the fishery. Estimated normal harvesting capacity for the current fleet, which was determined by reviewing historical average and maximum landings per trip, ranged from 60,000 mt to 111,000 mt per year. The physical harvesting capacity of the current fleet ranged from 361,000 to 539,000 mt per year. Physical capacity is a technological or engineering measure of the maximum potential output per unit of time.

Permit Transfers

As long as aggregate fleet GT is not above 5,933.5 mt (fleet GT plus 5 percent) limited entry permits can be transferred with the following restrictions: (1) Full transferability of permits only to vessels of comparable capacity (vessel GT +.10 (GT) or less), and (2) permits can be combined up to a greater level of capacity in cases where the vessel to which the permits would be transferred to is of greater harvesting capacity than the vessel from which the permit originated.

NMFS will endorse each limited entry permit based on the currently permitted vessel's calculated GT as defined by the formula in 46 CFR 69.209 for ship-shaped hulls. This formula is used by the U.S. Coast Guard (GT = 0.67 x length x breadth x depth/100). Records of length, breadth, and depth used for determining GT will be those recorded Start Printed Page 3821on the vessel's Coast Guard documentation.

The original permits and their respective endorsements will remain in effect for the lifetime of each permit, regardless of the GT of a vessel to which it was transferred. In cases where a permit is transferred to a vessel with a smaller GT, the original GT endorsement will remain, and excess GT cannot be split out from the original permit configuration and sold. In cases where two or more permits are transferred to a larger vessel, the larger vessel will hold the original permits and can fish for CPS finfish as long as the aggregate GT endorsements, including the 10 percent allowance, as defined by the formula for comparable capacity (vessel GT + .10 (GT) or less) adds up to or exceeds the new vessel's calculated GT. In the event that a vessel with multiple permits leaves the CPS limited entry program, the permits can be sold together or separately, but the original permit endorsement cannot be altered.

To ensure manageability of the permit program and stability of the fleet, only one transfer per permit will be allowed during each calendar year. Permits can be used only on the vessel to which they were registered. Catch history will be tied to the vessel and not to the permits.

Maintaining the Capacity Goal

When the upper threshold of aggregate fleet capacity plus 5 percent (5,933.5 mt) is reached, fleet capacity will be restored to the capacity goal (5,650.9 mt) by restricting conditions for permit transfer. The choice of 5 percent is a balance between allowing permit owners flexibility to improve their economic situation by modifying existing vessels or acquiring new vessels without leading to a fleet capacity that will take too long to return to the capacity goal. When the threshold of 5,933.5 mt is reached or exceeded, permits can only be transferred to vessels with equal or smaller GT, and the 10-percent vessel allowance will be removed. Restoring the 10 percent-allowance can be considered when total aggregate fleet capacity reaches the 5,650.9 mt target.

Procedures for Issuing New Limited Entry Permits

Based on changes in CPS finfish resources or market conditions, the Council may recommend to NMFS that new limited entry permits should be issued. If NMFS approves the recommendation, a notice will be published in the Federal Register describing the details of the recommendation. If new permits are issued, the qualifying criteria originally established in the FMP will be used for issuance. This will entail continuing down the list of vessels having landings during the 1993-97 window period in order of decreasing window period landings from the original qualifying level of 100 mt. If no vessel meets the qualifying criteria of 100 mt, then the permit will be issued to the vessel with total landings nearest 100 mt during the qualifying period. New permits can be issued on either a temporary or permanent basis, depending on the circumstances surrounding the need for additional fleet capacity.

Comments and Responses

Two letters were received. The comments therein focused primarily on the process used to issue new limited entry permits. Under Amendment 10 and the proposed rule, the Regional Administrator would use the qualifying period of January 1, 1993, through November 5, 1997, and the same qualification of landing at least 100 mt during this period as described in Amendment 8 to the FMP. If no vessel meets the landing requirement, then the permit would be issued to the vessel with landings nearest 100 mt.

Comment 1: The approach is arbitrary because (1) any gear that made the landing would be eligible, which could create a windfall for the qualifying vessel through transfer of the permit from a vessel that did not intend to fish CPS; (2) the procedure does not take into account section 301(a)(8) of the Magnuson-Stevens Act, which requires that proposed actions provide for sustained participation of fishing communities and minimize the impact on fishing communities, in this case, the fishing community of San Diego; and (3) the status of the California market squid fishery and the CPS finfish fishery, which are limited by the geographical range of the limited entry regime and recognized as closely related economically by the FMP, were not taken into account.

The commenter recommended that the inadequacies of Amendment 10 described in the previous paragraph be corrected by the following:

1. Issue permits to round-haul vessels that hold a market squid permit from the State of California. Amendment 10 recognizes the importance of squid to the CPS fishery, and some of these vessels that have participated in the CPS fishery before the qualifying period hold these permits.

2. Include as criteria for a permit, provisions of a California law that requires eligibility for fishermen that can provide evidence showing participation as a commercial fisherman for 20 years and who were participants in the CPS fishery for at least one of those years.

3. Include vessels that have a drift gill net shark and swordfish permit issued by the State of California.

4. Include vessels that have a history of participation in the tropical tuna fishery and the owner of the vessel is a member of the San Diego fishing community.

5. Include vessels that did not land 100 mt during the qualifying period.

The proposed remedy would not contribute to overcapitalilzation because fewer than 10 vessels are likely to qualify. The remedy also would minimize the impact on the fishing community in San Diego. Some vessels have squid permits but do not have CPS limited entry permits. Vessels that lost fishing access to Mexico when the Magnuson-Stevens Act extended jurisdiction to highly migratory species entered the drift gill net fishery. Recognizing the importance of having a squid permit and a CPS limited entry permit, and implementing the California criteria of historical participation makes a more reasonable accommodation to the fishing community in San Diego.

Response: The FMP does not specify the gear used for taking CPS because how the resource is harvested has never been an issue. Implementation of limited entry was expected to be beneficial to the economics of the fishery as a whole and may or may not be beneficial to any specific fisherman, because the value of permits is related to the condition of the resource and the prevailing markets for the harvest, both of which fluctuate over time. Nevertheless, limiting the number of harvesters tends to reduce individual risk. New permits would be issued only if the capacity of the fleet falls below the goal or the condition of the resource is such that new permits are warranted. Those individuals who participated in the fishery in the past but left the fishery and did not make the required landings during the window period, may qualify under the procedures of Amendment 10 if landings lower than 100 mt are considered. The Council decided to retain the current control date, window period, and level of landings required when issuing additional permits. This approach was adopted to be less disruptive in terms of displacing vessels from the fishery and reduces impacts on existing fishing patterns, and, therefore, on fishing communities.

Through Amendment 8 NMFS closely examined the relationship between vessels harvesting CPS finfish and those Start Printed Page 3822harvesting squid with respect to economic dependence. NMFS found that almost all of the originally permitted vessels also had squid permits from the State of California. Thus, NMFS chose not to issue permits to all holders of squid permits because the fleet would have been too large.

Implementation of Amendment 10 will allow permits to be transferable to another individual or to another vessel. Permits will have a cost, but the cost of a permit is expected to reflect the value of the permit. Therefore, those individuals needing to improve their business opportunities through the purchase of a permit will be able to assess the value of making the purchase by considering future potential harvests and the prevailing market for permits.

Comment 2: Amendment 10 does not present information as required under section 303(a)(4)(C) of the Magnuson-Stevens Act to provide data on the extent to which U.S. processors, on an annual basis, will process CPS landed by the CPS fleet.

Response: Harvesting capacity not processing capacity as it relates to overcapitalization is the subject of Amendment 10. Nevertheless, the FMP assumed that landings and processing capacity would increase as the biomass increased. Processing capacity has increased, and it continues to increase.

Comment 3: Amendment 10 does not discuss an option based on grandfathered permits as provided in California law.

Response: California law requires that any California fisherman with 20 years of participating in any fishery and 1 year in the fishery slated for limited entry be given a preference. While experience was considered in Amendment 10, only participation in the CPS fishery was considered in an effort to determine those individuals that depend on CPS and to prevent overcapitalization.

Comment 4: The provision to issue new permits is not fair and equitable. Amendment 10 requires new permits to be issued from the original list of vessels. The list of potentially qualifying vessels was developed under Amendment 8, before a fishery began off Oregon and Washington, which is a bias toward California fishermen. If fisheries off Oregon and Washington had existed when Amendment 8 was implemented, many Oregon and Washington fishermen would have received a permit.

Response: The decision was made by the Council to rely on the existing window period and required landings, which continues the Council's preference for historical participation. Before the FMP was implemented, some fishermen from other states entered the squid fishery, landed CPS, and qualified for a limited entry permit, an option open to anyone, regardless of state residency. New entrants in the fishery who have benefitted from participating in the open access fishery may also enter the limited entry fishery by purchasing a permit under the rules established by Amendment 10.


The Administrator, Southwest Region, NMFS, determined that the FMP Amendment 10 is necessary for the conservation and management of the coastal pelagic species fishery and that it is consistent with the Magnuson-Stevens Act and other applicable laws.

Because the rule relieves a restriction on the sale to other individuals and/or transfer to other vessels of limited entry permits, it is not necessary to delay the effective date of this final rule for 30 days under 5 U.S.C. 553(d)(1), except for § 660.512(h). This rule will give individuals flexibility in managing their business affairs by allowing them to invest in the fishery through the purchase of a permit or to sell a permit on the open market.

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

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that the proposed rule for this action would not have a significant economic impact on a substantial number of small entities. No comments were received regarding this certification. However, several comments addressed the economic impact of the rule. Responses to these comments are presented above. None of these comments resulted in a change to the determination that the rule would not have a significant economic impact. As a result, a regulatory flexibility analysis was not prepared.

This final rule contains a collection-of-information requirement subject to the Paperwork Reduction Act (PRA) and which has been approved by OMB under control number 0648-0204. Public reporting burden for an application for transfer of a limited entry permit is estimated to average 30 minutes per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate, or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS (See ADDRESSES) and to OMB at the Office of Information and Regulatory Affairs, OMB, Washington, D.C. 20503 (Attention: NOAA Desk Officer).

Notwithstanding any other provision of the law, no person is required to respond to, nor shall a person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.

There have been no changes to the regulatory text in the proposed rule.

Start List of Subjects

List of Subjects in 50 CFR Part 660

  • Administrative practice and procedure
  • American Samoa
  • Fisheries
  • Fishing
  • Guam
  • Hawaiian Natives
  • Indians
  • Northern Mariana Islands
  • Reporting and recordkeeping requirements
End List of Subjects Start Signature

Dated: January 21, 2003.

Rebecca Lent,

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

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For the reasons set out in the preamble, NMFS amends 50 CFR part 660 as follows:

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1. The authority citation for part 660 continues to read as follows:

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Authority: 16 U.S.C. 1801 et seq.

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2. In § 660.502, definitions for “comparable capacity”, and “gross tonnage” are added, in alphabetical order, to read as follows:

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* * * * *

Comparable capacity means gross tonnage plus 10 percent of the vessel's calculated gross tonnage.

* * * * *

Gross tonnage (GT) means gross tonnage as determined by the formula in 46 CFR 69.209(a) for a vessel not designed for sailing (.67 x length x breadth x depth/100). A vessel's length, breadth, and depth are those specified on the vessel's certificate of documentation issued by the U.S. Coast Guard or State.

* * * * *
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3. In § 660.512, a new paragraph (h) is added to read as follows:

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Limited entry fishery.
* * * * *

(h) Issuance of new permits. (1) When the aggregate gross tonnage of all vessels participating in the limited entry fishery Start Printed Page 3823declines below 5,650.9 metric tons (mt), the Council will review the status of the fishery, taking into consideration:

(i) The changes in gross tonnage that have and are likely to occur in the transfer of limited entry permits;

(ii) The actual harvesting capacity as experienced in the current fishery in comparison to the capacity goal;

(iii) Comments of the CPSMT;

(iv) Any other relevant factors related to maintaining the capacity goal.

(2) Following its review, the Council will recommend to NMFS whether additional permit(s) should be issued and if the new permit(s) should be temporary or permanent. The issuance of new permit(s) shall be based on the following:

(i) The qualifying criteria in paragraph (b) of this section, but vessels that were issued a permit before December 31, 2000, are not eligible.

(ii) If no vessel meets the qualifying criteria in paragraph (b), then the permit(s) will be issued to the vessel(s) with total landings nearest 100 mt during the qualifying period of paragraph (b).

(iii) No vessel will be issued a permit under this paragraph (h) that is currently registered for use with a permit.

(3) The Regional Administrator will review the Council's recommendation and determine whether issuing additional permit(s) is consistent with the FMP and with paragraph (h)(2) of this section. If issuing additional permit(s) is appropriate, the Regional Administrator will:

(i) Issue the appropriate number of permits consistent with the Council's recommendation; and

(ii) Publish a document in the Federal Register notifying the public that new permits or a new permit has been issued, the conditions attached to any permit, and the reasons for the action.

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4. Section 660.514 is revised to read as follows:

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(a) General. (1) The SFD will process applications for transferring limited entry permits to a different owner and/or to a different vessel according to this section.

(2) After January 27, 2003, the SFD will issue a limited entry permit to the owner of each vessel permitted to participate in the limited entry fishery for CPS. This permit will replace the existing permit and will include the gross tonnage of the vessel, which will constitute an endorsement for that vessel for the purpose of regulating the transfer of limited entry permits.

(b) Criteria. (1) When the aggregate gross tonnage of all vessels participating the limited entry fishery is at or below 5,650.9 mt, a permit may be transferred to a different owner or to a different vessel in the following circumstances only:

(i) A permit may be transferred to a vessel without a permit if the vessel without a permit has a comparable capacity to the capacity on the permit or is less than comparable capacity on the permit.

(ii) When a permit is transferred to a vessel without a permit that has less gross tonnage than that of the permitted vessel, the excess gross tonnage may not be separated from the permit and applied to a second vessel.

(iii) A permit may be transferred to a vessel without a permit that is of greater than comparable capacity only if two or more permits are transferred to the vessel without a permit to equal the gross tonnage of the vessel. The number of permits required will be determined by adding together the comparable capacity of all permits being transferred. Any gross tonnage in excess of that needed for a vessel remains with the permit.

(2) When a vessel with multiple permits leaves the fishery, the permits may be sold separately and applied to other vessels according to the criteria in this section.

(c) Stipulations. (1) The gross tonnage endorsement of a permit is integral to the permit for the duration of the permit, regardless of the gross tonnage of any vessel to which the permit is transferred.

(2) Permits may be used only on the vessel for which they are registered by the SFD. All permits that authorize a vessel to operate in the limited entry fishery must be on board the vessel during any fishing trip on which CPS is harvested or is on board.

(3) A permit may be transferred only once during a calendar year.

(d) Vessel alterations. (1) A permitted vessel's length, breadth, or depth may be altered to increase the gross tonnage of the vessel only if the aggregate gross tonnage of all vessels participating in the limited entry fishery equals, or is below 5,650.9 mt, and only under the following conditions:

(i) The gross tonnage of the altered vessel, calculated according to the formula in 46 CFR 69.209(a), does not exceed 110 percent of the vessel's original gross tonnage endorsement, and

(ii) A new certificate of documentation is obtained from the U.S. Coast Guard or State. Modifications exceeding 110 percent of the vessel's gross tonnage endorsement will require registration of the vessel under an additional permit or permits or under a permit with a sufficient gross tonnage endorsement.

(2) A copy of the certificate of documentation indicating changes in length, depth, or breadth must be provided to the SFD.

(3) The revised gross tonnage will not be valid as an endorsement until a revised permit is issued by the SFD.

(e) Applications. (1) All requests for the transfer of a limited entry permit will be made to the SFD in writing and shall contain the following information:

(i) Name, address, and phone number of the owner of the permitted vessel.

(ii) Name of the permitted vessel and documentation number of the vessel.

(iii) Name, address, and phone number of the owner of the vessel to which the permit is to be transferred.

(iv) Name and documentation number of the vessel to which the permit is to be transferred.

(v) Signature(s) of the owner(s) of the vessels participating in the transfer.

(vi) Any other information that the SFD may request.

(2) No permit transfer is effective until the transfer has been authorized by the SFD.

(f) Capacity reduction. (1) When the aggregate gross tonnage of the limited entry fleet reaches 5,933.5 mt, a permit may be transferred to a vessel without a permit only if the vessel without a permit is of the same or less gross tonnage.

(2) When the aggregate gross tonnage of the limited entry fleet reaches 5,933.5 mt, alterations in the length, depth, or breadth of a permitted vessel may not result in an increase in the gross tonnage of the vessel.

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[FR Doc. 03-1784 Filed 1-24-03; 8:45 am]