Unknown. Correcting amendment

50,340 words·~229 min read·/register/2007/11/07/07-5549

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

--- schema: federal-register doc_type: fedreg source_file: FR-2007-11-07.xml --- 72 215 Wednesday, November 7, 2007 Contents Agricultural Agricultural Marketing Service NOTICES Meetings: Plant Variety Protection Board, 62812 E7-21831 Agriculture Agriculture Department See Agricultural Marketing Service See Animal and Plant Health Inspection Service See Federal Crop Insurance Corporation See Forest Service Animal Animal and Plant Health Inspection Service PROPOSED RULES Interstate transportation of animals and animal products (quarantine):

Equines; commercial transportation to slaughter facilities, 62798-62802 E7-21896 Antitrust Antitrust Division NOTICES National cooperative research notifications: Advanced Media Workflow Association, 62864 07-5555 ASTM International, 62864 07-5558 DVD Copy Control Association, 62865 07-5565 Industrial Macromolecular Crystallography Association, 62865 07-5561 Interchangeable Virtual Instruments Foundation, Inc., 62865 07-5569 LiMo Foundation, 62866 07-5568 Network Centric Operations Industry Consortium, Inc., 62866 07-5553 Open DeviceNet Vendor Association, Inc., 62866-62867 07-5562 Petroleum Environmental Research Forum, 62867 07-5567 Portland Cement Association, 62867 07-5563 PXI Systems Alliance, Inc., 62867 07-5560 SAE Consortium Ltd., 62867-62868 07-5554 Semiconductor Test Consortium, Inc., 62868 07-5552 Southwest Research Institute, 62868-62869 07-5559 07-5564 07-5566 TeleManagement Forum, 62869-62870 07-5556 VSI Alliance, 62870 07-5557 Centers Centers for Disease Control and Prevention NOTICES Agency information collection activities; proposals, submissions, and approvals, 62857 E7-21864 Meetings:

Disease, Disability, and Injury Prevention and Control Special Emphasis Panels, 62857-62858 E7-21842 Commerce Commerce Department See Industry and Security Bureau See International Trade Administration Comptroller Comptroller of the Currency RULES Fair and Accurate Credit Transactions Act; implementation: Fair credit reporting provisions (Regulation V); affiliate marketing, 62910-62990 07-5349 Council Council on Environmental Quality NOTICES Reports and guidance documents; availability, etc.:

Collaboration in National Environmental Policy Act-handbook for NEPA practitioners, 62854 E7-21881 Defense Defense Department RULES Federal Acquisition Regulation (FAR): Biobased products preference program, 63040-63045 07-5478 Contracts containing construction requirements-contract pricing method references; labor standards, 63088-63089 07-5483 Federal computer network architecture, 63075-63076 07-5479 Introduction, 63026-63027 07-5476 Local Community Recovery Act of 2006; set-asides, 63084-63088 07-5482 Part 27 rewrite in plain language, 63045-63075 07-5475 Safety Act; implementation, 63027-63040 07-5477 Service Contract Act; exemption of certain service contracts, 63076-63083 07-5481 Small Entity Compliance Guide, 63094-63095 07-5485 Technical amendments, 63089-63093 07-5484 Drug Drug Enforcement Administration NOTICES *Applications, hearings, determinations, etc.:* Alcan Packaging-Bethlehem, 62871 E7-21859 Cambrex North Brunswick, Inc., 62871 E7-21865 Cayman Chemical Co., 62871 E7-21848 Cerilliant Corp., 62872 E7-21846 Hospira, Inc., 62872 E7-21847 Noramco Inc., 62873 E7-21849 Penick Corp., 62873 E7-21850 Education Education Department NOTICES State educational agencies expenditure and revenue data submission, 62841-62842 E7-21899 Employment Employment and Training Administration NOTICES Federal-State Unemployment Compensation Program:

Federal Unemployment Tax Act; certifications, 62874-62879 07-5550 Energy Energy Department See Federal Energy Regulatory Commission EPA Environmental Protection Agency RULES Air quality implementation plans; approval and promulgation; various States: West Virginia; withdrawn, 62788 E7-21863 Pesticides; tolerances in food, animal feeds, and raw agricultural commodities: Oxytetracycline, 62788-62794 E7-21796 PROPOSED RULES Air quality implementation plans; approval and promulgation; various States:

Delaware, 62807-62809 E7-21853 West Virginia, 62809-62811 E7-21866 NOTICES Meetings: Association of American Pesticide Control Officials/State FIFRA Issues Research and Evaluation Group, 62843-62844 E7-21724 Mid-Atlantic/Northeast Visibility Union; stakeholder briefing, 62844 E7-21851 National Environmental Justice Advisory Council, 62844-62845 E7-21856 Pesticide programs: Risk assessment— Prometon, 62845-62846 E7-21854 Pesticide registration, cancellation, etc.: Chloroneb, 62847-62848 E7-21789 Denatonium benzoate, 62848-62850 07-5527 Methyl parathion, 62850-62852 E7-21787 Reports and guidance documents; availability, etc.:

Pesticide management and disposal; pesticide containers and containment standards; guidance for registrants on labeling revisions, 62852-62853 E7-21860 Superfund; response and remedial actions, proposed settlements, etc.: PCB Treatment Inc. Site, KS, 62853-62854 E7-21894 Environment Environmental Quality Council See Council on Environmental Quality Executive Executive Office of the President See Council on Environmental Quality FAA Federal Aviation Administration PROPOSED RULES Airworthiness directives:

Boeing, 62802-62805 E7-21843 NOTICES Meetings: RTCA, Inc., 62894 07-5543 Reports and guidance documents; availability, etc.: Flammability of MIL-C 17/60, /93, /94, /113, /127, /128 coaxial cable; policy statement, 62894-62895 E7-21826 Federal Crop Federal Crop Insurance Corporation RULES Crops insurance regulations: Fresh market sweet corn crop provisions Correction, 62767-62768 E7-21852 FDIC Federal Deposit Insurance Corporation RULES Fair and Accurate Credit Transactions Act; implementation:

Fair credit reporting provisions (Regulation V); affiliate marketing, 62910-62990 07-5349 Federal Energy Federal Energy Regulatory Commission NOTICES Electric rate and corporate regulation combined filings, 62842-62843 E7-21835 FMC Federal Maritime Commission NOTICES Agreements filed, etc., 62854-62855 E7-21897 Ocean transportation intermediary licenses: Atlantic Shipping Co., Inc., et al., 62855 E7-21898 CSC Lines et al., 62855 E7-21892 Natural Freight Ltd., 62855-62856 E7-21891 Federal Motor Federal Motor Carrier Safety Administration RULES Motor carrier safety standards:

Calculating crash rates and driver, vehicle, and hazardous materials out-of-service rates, etc.; enforcement policy, 62795-62797 E7-21833 NOTICES Agency information collection activities; proposals, submissions, and approvals, 62895-62896 E7-21880 Motor carrier safety standards: Driver qualifications; vision requirement exemptions, 62896-62898 E7-21878 07-5546 Federal Reserve Federal Reserve System RULES Fair and Accurate Credit Transactions Act; implementation: Fair credit reporting provisions (Regulation V); affiliate marketing, 62910-62990 07-5349 Federal Transit Federal Transit Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 62898 E7-21827 Fish Fish and Wildlife Service PROPOSED RULES Endangered and threatened species:

Preble's meadow jumping mouse, 62992-63024 07-5486 Food Food and Drug Administration RULES Animal drugs, feeds, and related products: Ivermectin; implantation or injectable dosage form, 62771 E7-21839 NOTICES Human drugs: New drug applications— Lederle Laboratories et al; approval withdrawn, 62858-62863 E7-21886 Forest Forest Service NOTICES Recreation fee areas: Coronado National Forest, AZ; overnight rental fees, 62812 07-5549 GSA General Services Administration RULES Federal Acquisition Regulation (FAR):

Biobased products preference program, 63040-63045 07-5478 Contracts containing construction requirements-contract pricing method references; labor standards, 63088-63089 07-5483 Federal computer network architecture, 63075-63076 07-5479 Introduction, 63026-63027 07-5476 Local Community Recovery Act of 2006; set-asides, 63084-63088 07-5482 Part 27 rewrite in plain language, 63045-63075 07-5475 Safety Act; implementation, 63027-63040 07-5477 Service Contract Act; exemption of certain service contracts, 63076-63083 07-5481 Small Entity Compliance Guide, 63094-63095 07-5485 Technical amendments, 63089-63093 07-5484 Health Health and Human Services Department See Centers for Disease Control and Prevention See Food and Drug Administration NOTICES Committees; establishment, renewal, termination, etc.:

Human Research Protections Advisory Committee; nominations, 62856-62857 E7-21824 Meetings: Minority Health Advisory Committee, 62857 E7-21822 Homeland Homeland Security Department See U.S. Citizenship and Immigration Services Industry Industry and Security Bureau RULES Export Administration regulations: Commerce control list— QRS11 micromachined angular rate sensors; expanded licensing jurisdiction, 62768-62771 E7-21840 Interior Interior Department See Fish and Wildlife Service See Land Management Bureau IRS Internal Revenue Service RULES Income taxes:

Foreign tax credit; foreign tax redeterminations notification, 62771-62788 E7-21766 PROPOSED RULES Income taxes: Foreign tax credit; notification and adjustment due to foreign tax redeterminations; cross-reference; withdrawn in part, 62805-62807 E7-21727 International International Trade Administration NOTICES Antidumping: Automotive replacement glass windshields from— China, 62812-62816 E7-21875 E7-21876 E7-21877 Carbon and alloy steel wire rod from— Canada, 62816-62820 E7-21869 Mexico, 62820-62824 E7-21870 Trinidad and Tobago, 62824-62826 E7-21871 Glycine from— India, 62826-62834 E7-21872 E7-21873 Wooden bedroom furniture from— China, 62834-62837 E7-21955 Countervailing duties:

Welded carbon steel standard pipe from— Turkey, 62837-62841 E7-21874 International International Trade Commission NOTICES Import investigations: 3G mobile handsets and components, 62863-62864 E7-21837 Justice Justice Department See Antitrust Division See Drug Enforcement Administration Labor Labor Department See Employment and Training Administration See Occupational Safety and Health Administration NOTICES Committees; establishment, renewal, termination, etc.: Data Users Advisory Committee, 62873-62874 E7-21823 Land Land Management Bureau NOTICES Committees; establishment, renewal, termination, etc.:

Wild Horse and Burro Advisory Board, 62863 E7-21887 Maritime Maritime Administration NOTICES Voluntary Intermodal Sealift Agreement, 62898-62906 E7-21867 NASA National Aeronautics and Space Administration RULES Federal Acquisition Regulation (FAR): Biobased products preference program, 63040-63045 07-5478 Contracts containing construction requirements-contract pricing method references; labor standards, 63088-63089 07-5483 Federal computer network architecture, 63075-63076 07-5479 Introduction, 63026-63027 07-5476 Local Community Recovery Act of 2006; set-asides, 63084-63088 07-5482 Part 27 rewrite in plain language, 63045-63075 07-5475 Safety Act; implementation, 63027-63040 07-5477 Service Contract Act; exemption of certain service contracts, 63076-63083 07-5481 Small Entity Compliance Guide, 63094-63095 07-5485 Technical amendments, 63089-63093 07-5484 National Credit National Credit Union Administration RULES Fair and Accurate Credit Transactions Act; implementation:

Fair credit reporting provisions (Regulation V); affiliate marketing, 62910-62990 07-5349 Nuclear Nuclear Regulatory Commission NOTICES Environmental statements; availability, etc.: Nuclear Fuel Services, Inc., 62880-62883 E7-21861 Occupational Occupational Safety and Health Administration NOTICES Meetings: Maritime Advisory Committee for Occupational Safety and Health, 62880 E7-21845 Personnel Personnel Management Office RULES Veterans’ preference: Veteran definition; individuals discharged or released from active duty, preference eligibility clarification; conformity between veterans’ preference laws Correction, 62767 E7-21868 NOTICES Agency information collection activities; proposals, submissions, and approvals, 62883 E7-21862 Pipeline Pipeline and Hazardous Materials Safety Administration NOTICES Meetings:

International standards on the transport of dangerous goods, 62906-62907 07-5544 SEC Securities and Exchange Commission NOTICES Self-regulatory organizations; proposed rule changes: Chicago Board Options Exchange, Inc., 62883-62885 E7-21838 International Securities Exchange, LLC, 62885-62892 E7-21836 State State Department NOTICES Agency information collection activities; proposals, submissions, and approvals, 62892-62894 E7-21855 E7-21857 E7-21858 Surface Surface Transportation Board NOTICES Railroad services abandonment:

Northern Southern Railway Co., 62907 E7-21832 Thrift Thrift Supervision Office RULES Fair and Accurate Credit Transactions Act; implementation: Fair credit reporting provisions (Regulation V); affiliate marketing, 62910-62990 07-5349 Savings associations: Personal securities transactions; officer and employee reporting requirements, 62768 E7-21751 Transportation Transportation Department See Federal Aviation Administration See Federal Motor Carrier Safety Administration See Federal Transit Administration See Maritime Administration See Pipeline and Hazardous Materials Safety Administration See Surface Transportation Board Treasury Treasury Department See Comptroller of the Currency See Internal Revenue Service See Thrift Supervision Office MISSING FOR:

U.S. Citizenship and Immigration Services U.S. Citizenship and Immigration Services NOTICES Meetings: E-Verify evaluation, 62863 E7-21829 Veterans Veterans Affairs Department NOTICES Meetings: Veterans’ Rehabilitation Advisory Committee, 62907 07-5540 Separate Parts In This Issue Part II Federal Deposit Insurance Corporation; Federal Reserve System; National Credit Union Administration; Treasury Department, Comptroller of the Currency; Treasury Department, Thrift Supervision Office, 62910-62990 07-5349 Part III Interior Department, Fish and Wildlife Service, 62992-63024 07-5486 Part IV Defense Department;

General Services Administration; National Aeronautics and Space Administration, 63026-63095 07-5475 07-5476 07-5477 07-5478 07-5479 07-5481 07-5482 07-5483 07-5484 07-5485 Reader Aids Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws. To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.gpo.gov and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions. 72 215 Wednesday, November 7, 2007 Rules and Regulations OFFICE OF PERSONNEL MANAGEMENT 5 CFR Part 353 RIN 3206-AL21 Restoration to Duty From Uniformed Service or Compensable Injury AGENCY:

Office of Personnel Management. ACTION: Correcting amendment. SUMMARY: The Office of Personnel Management issued final regulations on March 15, 2007 (72 FR 12032), to amend a number of rules on pay and leave administration, including use of paid leave during uniformed service. This notice corrects an omission in the final regulations and changes the title of this section to accurately reflect the content. DATES: This correcting amendment is effective November 7, 2007, and applicable to May 14, 2007.

FOR FURTHER INFORMATION CONTACT: Brenda Roberts by telephone at

(202)606-2858; by fax at

(202)606-0824; or by e-mail at *pay-performance-policy@opm.gov.* SUPPLEMENTARY INFORMATION: The Office of Personnel Management is making the following correction to § 353.208 in title 5, Code of Federal Regulations, to insert the phrase “or sick leave under 5 U.S.C. 6307, if appropriate,” which was inadvertently omitted from the final regulation. We are also changing the title of this section from “use of paid leave during uniform service” to “use of paid time off during uniform service” to accurately reflect the inclusion of compensatory time off for travel that was added to this section in the final regulation. List of Subjects in 5 CFR Part 353 Administrative practice and procedure, Government employees. Accordingly, 5 CFR part 353 is corrected by making the following correcting amendments: PART 353—RESTORATION TO DUTY FROM UNIFORMED SERVICE OR COMPENSABLE INJURY 1. The authority citation for part 353 continues to read as follows: Authority: 38 U.S.C. 4301 *et seq.,* and 5 U.S.C. 8151. Subpart B—Uniformed Service 2. Section 353.208 is revised to read as follows: § 353.208 Use of paid time off during uniformed service. An employee performing service with the uniformed services must be permitted, upon request, to use any accrued annual leave under 5 U.S.C. 6304, military leave under 5 U.S.C. 6323, earned compensatory time off for travel under 5 U.S.C. 5550b, or sick leave under 5 U.S.C. 6307, if appropriate, during such service. Office of Personnel Management. Jerome D. Mikowicz, Deputy Associate Director, Center for Pay and Leave Administration. [FR Doc. E7-21868 Filed 11-6-07; 8:45 am] BILLING CODE 6325-39-P DEPARTMENT OF AGRICULTURE Federal Crop Insurance Corporation 7 CFR Part 457 RIN 0563-AC02 Common Crop Insurance Regulations, Fresh Market Sweet Corn Crop Insurance Provisions; Correction AGENCY: Federal Crop Insurance Corporation, USDA. ACTION: Final rule; correction. SUMMARY: This document contains a correction to the final regulation which was published Wednesday, September 26, 2007 (72 FR 54519-54525). The regulation pertains to the insurance of fresh market sweet corn. EFFECTIVE DATE: November 7, 2007. FOR FURTHER INFORMATION CONTACT: Linda Williams, Risk Management Specialist, Product Management, Product Administration and Standards Division, Risk Management Agency, United States Department of Agriculture, Beacon Facility—Mail Stop 0812, PO Box 419205, Kansas City, MO 64141-6205, telephone

(816)926-7730. SUPPLEMENTARY INFORMATION: Background The final regulation that is the subject of this correction was intended to amend certain Fresh Market Sweet Corn Crop Provisions to be used in conjunction with the Common Crop Insurance Policy Basic Provisions for ease of use and consistency of terms. Need for Correction As published, the final regulation contained an error that may prove to be misleading and needs to be clarified. Section 16(b)(1) of the Fresh Market Sweet Corn Crop Provisions contained a parenthetical phrase that was inadvertently misplaced within the sentence so that it did not provide the correct computation to be used when computing the value of sweet corn production that is sold. This correction moves the parenthetical to the location it should have been to provide the correct computation. List of Subjects in 7 CFR Part 457 Crop insurance, Fresh market sweet corn, Reporting and recordkeeping requirements. Correction of Publication Accordingly, the 7 CFR Part 457 is corrected as follows: PART 457—COMMON CROP INSURANCE REGULATIONS 1. The authority citation for 7 CFR part 457 continues to read as follows: Authority: 7 U.S.C. 1506(l) and 1506(p). 2. Amend § 457.129 as follows: a. Revise section 16(b)(1) to read as set forth below; The revision reads as follows: § 457.129 Fresh market sweet corn crop insurance provisions. 16. Minimum Value Option.

(b)* * *

(1)The dollar amount obtained by multiplying the average net value per container from all sweet corn sold (this result may not be less than the minimum value option amount if such amount is provided in the Special Provisions) by the total number of all containers of sweet corn sold; Signed in Washington, DC, on November 1, 2007. Eldon Gould, Manager, Federal Crop Insurance Corporation. [FR Doc. E7-21852 Filed 11-6-07; 8:45 am] BILLING CODE 3410-08-P DEPARTMENT OF THE TREASURY Office of Thrift Supervision 12 CFR Part 551 [Docket ID OTS-2007-0010] RIN 1550-AC07 Personal Transactions in Securities AGENCY: Office of Thrift Supervision, Treasury. ACTION: Final rule. SUMMARY: In June 2007, the Office of Thrift Supervision

(OTS)adopted an interim final rule (Interim Rule) that requires certain officers and employees of savings associations to file reports of their personal securities transactions with the savings association no later than thirty calendar days after the end of each calendar quarter. Before OTS adopted the Interim Rule, persons subject to the rule were required to file such reports within ten business days after the end of each calendar quarter. The thirty-calendar-day period is consistent with the filing requirement for persons in similar positions at investment companies who file such reports under regulations of the Securities and Exchange Commission (SEC). Today, OTS is adopting a final rule that is identical to the Interim Rule. DATES: The interim rule published at 72 FR 30473, June 1, 2007 is adopted as final effective November 7, 2007. FOR FURTHER INFORMATION CONTACT: Judi McCormick,

(202)906-5636, Director—Trust and Specialty Programs, Examinations and Supervision Policy Division; or David A. Permut,

(202)906-7505, Senior Attorney, Business Transactions Division, Office of Chief Counsel, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552. SUPPLEMENTARY INFORMATION: I. Background and Public Comments On June 1, 2007, OTS published the Interim Rule. 1 The preamble to the Interim Rule included a request for public comment. The Interim Rule amended 12 CFR 551.150(a) by changing the time period required for officers and employees who are subject to the rule to file personal securities trading reports with the savings association. Before OTS adopted the Interim Rule, the affected officers and employees had been required to file such reports with the savings association within ten business days of the end of each calendar quarter. The Interim Rule changed the ten-business day period to no later than thirty calendar days. 2 OTS received two comments, from a trade association and a savings and loan holding company, regarding the Interim Rule. Both of the comments strongly support the Interim Rule. The commenters believe that it is appropriate for the time period provided for submitting reports under section 551.150(a) to be consistent with analogous SEC requirements. In addition, the commenters support the rule because it reduces regulatory burden. 1 See 72 FR 30473 (June 1, 2007). 2 SEC Rule 17j-1 under the Investment Company Act, 17 CFR 270.17j-1 (2007), requires investment advisors to file personal trading reports no later than 30 days after the end of each calender quarter. OTS modeled the personal securities filing requirement in the OTS recordkeeping regulations on the SEC rule. The Interim rule caused the requirements under OTS regulations and the SEC's investment advisor requirements to be consistent. Having considered the comments, OTS is adopting a final rule that is identical to the Interim Rule. II. Regulatory Findings A. Paperwork Reduction Act OTS has determined that this rule does not involve a change to collections of information previously approved under the Paperwork Reduction Act (44 U.S.C. 3501 *et seq.* ). B. Executive Order 12866 The Director of OTS has determined that this rule does not constitute a “significant regulatory action” for purposes of Executive Order 12866. C. Regulatory Flexibility Act Pursuant to section 605(b) of the Regulatory Flexibility Act (5 U.S.C. 601), the Director certifies that this rule will not have a significant economic impact on a substantial number of small entities. The rule makes certain changes that should reduce burdens on certain officers and employees of all savings associations, including small institutions. The change is minor and should not have a significant impact on small institutions. Accordingly, OTS has determined that a Regulatory Flexibility Analysis is not required. D. Unfunded Mandates Reform Act of 1995 OTS has determined that the rule will not result in expenditures by state, local, or tribal governments or by the private sector of $100 million or more and that a budgetary impact statement is not required under Section 202 of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4 (Unfunded Mandates Act). The rule would make certain changes that should reduce burdens on certain officers and employees of savings associations. The change is minor and should not have a significant impact on small institutions. Accordingly, a budgetary impact statement is not required under section 202 of the Unfunded Mandates Act. List of Subjects in 12 CFR Part 551 Reporting and recordkeeping requirements, Savings associations, Securities, Trusts and trustees. PART 551—RECORDKEEPING AND CONFIRMATION REQUIREMENTS FOR SECURITIES TRANSACTIONS Accordingly, the interim rule amending 12 CFR part 551 which was published at 72 FR 30473 on June 1, 2007, is adopted as a final rule without change. Dated: October 30, 2007. By the Office of Thrift Supervision. John M. Reich, Director. [FR Doc. E7-21751 Filed 11-6-07; 8:45 am] BILLING CODE 6720-01-P DEPARTMENT OF COMMERCE Bureau of Industry and Security 15 CFR Parts 734 and 774 [Docket No. 0612242561-7519-01] RIN: 0694-AD92 Expanded Licensing Jurisdiction for QRS11 Micromachined Angular Rate Sensors AGENCY: Bureau of Industry and Security, Commerce. ACTION: Final Rule. SUMMARY: This final rule amends the Export Administration Regulations

(EAR)to implement the transfer of licensing jurisdiction for QRS11-00100-100/101 and the QRS11-00050-443/569 Micromachined Angular Rate Sensors from the Department of State to the Department of Commerce (see Public Notice 5823, published in 72 FR 31452-31453, June 7, 2007) when the QRS11-00100-100/101 is integrated into a primary instrument system for use on civil aircraft or is exported solely for integration into such a system, or when the QRS11-00050-443/569 is integrated into an automatic flight control system of the type described in ECCN 7A994 or aircraft of the type described in ECCN 9A991 that incorporates such systems, or are exported solely for integration into such a system. DATES: This rule is effective: November 7, 2007. ADDRESSES: Although this is a final rule, comments are welcome and should be sent to *publiccomments@bis.doc.gov* , fax

(202)482-3355, or to Regulatory Policy Division, Bureau of Industry and Security, Room H2705, U.S. Department of Commerce, Washington, DC 20230. Please refer to regulatory identification number

(RIN)0694-AD92 in all comments, and in the subject line of e-mail comments. Comments on the collection of information should be sent to David Rostker, Office of Management and Budget (OMB), by e-mail to *David_Rostker@omb.eop.gov* , or by fax to

(202)395-7285. FOR FURTHER INFORMATION CONTACT: Gene Christiansen, Office of National Security and Technology Transfer Controls, Bureau of Industry and Security, U.S. Department of Commerce at

(202)482-2984. SUPPLEMENTARY INFORMATION: Background On February 9, 2004, the Bureau of Industry and Security published a rule implementing Department of Commerce licensing jurisdiction over QRS11-00100-100/101 Micromachined Angular Rate Sensors integrated into and included as an integral part of a Commercial Standby Instrument System

(CSIS)of the type described in the Export Administration Regulations

(EAR)under ECCN 7A994 or an aircraft of the type described in ECCN 9A991 that incorporates a CSIS that has such a sensor integrated, or exported solely for integration into such a system. In all other cases, the QRS11 Micromachined Angular Rate Sensors, including the QRS11-00100-100/101 sensors, remained subject to the licensing jurisdiction of the Department of State, Directorate of Defense Trade Controls. (See 69 FR 5928, February 9, 2004.) Subsequently, industry inquiries about incorporating the QRS11 into primary instrument systems or into automatic flight control systems, in addition to the secondary or standby systems, led the Department of State to remove from the United States Munitions List quartz rate sensors used in these applications [72 FR 31452]. Reflecting the removal of such quartz rate sensors from the United States Munitions List, this rule establishes licensing requirements for QRS11-00100-100/101 and the QRS11-00050-443/569 Micromachined Angular Rate Sensors by the Department of Commerce when the QRS11-00100-100/101 sensors are integrated into a primary instrument system or are exported solely for integration into such a system or when the QRS11-00050-443/569 sensors are integrated into an automatic flight control system for use on civil aircraft, or are exported solely for integration into such a system. There continues to be no de minimis level for foreign-made systems that contain QRS11-00100-100/101 or QRS11-00050-443/569 Micromachined Angular Rate Sensors, or for foreign-made aircraft that incorporate systems that have QRS11-00100-100/101s or QRS11-00050-443/569s integrated (see § 734.4(a) of the EAR). The instrument systems, the automatic flight control systems, and the aircraft remain subject to the EAR regardless of their percentage, by value, of U.S. content. Consistent with the provisions of section 6 of the Export Administration Act, a foreign policy report was submitted to Congress on November 1, 2007, notifying the Congress of the change in licensing jurisdiction reflected in this rule. Although the Export Administration Act expired on August 20, 2001, the President, through Executive Order 13222 of August 17, 2001 (66 Fed. Reg. 44025, 3 CFR, 2001 Comp., p. 783), as extended by the Notice of August 15, 2007 (72 Fed. Reg. 46137, August 16, 2007), has continued the Export Administration Regulations in effect under the International Emergency Economic Powers Act. Rulemaking Requirements 1. This final rule has been determined to be not significant for purposes of E.O. 12866. 2. Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act, unless that collection of information displays a currently valid Office of Management and Budget Control Number. This rule involves a collection of information subject to the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). This collection has been approved by the Office of Management and Budget under control number 0694-0088, “Multi-Purpose Application,” which carries a burden hour estimate of 58 minutes for a manual or electronic submission. Send comments regarding these burden estimates or any other aspect of these collections of information, including suggestions for reducing the burden, to OMB Desk Officer, New Executive Office Building, Washington, DC 20503; and to the Office of Administration, Bureau of Industry and Security, Department of Commerce, 14th and Pennsylvania Avenue, NW., Room 6883, Washington, DC 20230. 3. This rule does not contain policies with Federalism implications as that term is defined under E.O. 13132. 4. The provisions of the Administrative Procedure Act (5 U.S.C. 553) requiring prior notice, the opportunity for public comment, and a delay in effective date, are inapplicable because this regulation involves a military and foreign affairs function of the United States (5 U.S.C. 553(a)(1)). Further, no other law requires that prior notice and an opportunity for public comment be given for this final rule. Because prior notice and an opportunity for public comment are not required to be given for this rule under the Administrative Procedure Act or by any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) are not applicable. Therefore, this regulation is issued in final form. Although there is no formal comment period, public comments on this regulation are welcome on a continuing basis. Comments should be submitted to Hillary Hess, Office of Exporter Services, Bureau of Export Administration, Room H2705, U.S. Department of Commerce, Washington, DC 20230. List of Subjects 15 CFR Part 734 Administrative practice and procedure, Exports, Foreign trade. 15 CFR Part 774 Exports, Foreign trade. Accordingly, parts 734 and 774 of the Export Administration Regulations (15 CFR parts 730-774) are amended as follows: PART 734—[AMENDED] 1. The authority citation for 15 CFR part 734 continues to read as follows: Authority: 50 U.S.C. app. 2401 *et seq.* ; 50 U.S.C. 1701 *et seq.* ; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 61 FR 54079, 3 CFR, 1996 Comp. p. 219; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of October 27, 2006, 71 FR 64109 (October 31, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007). 2. Section 734.4 is amended by revising paragraph (a)(3) to read as follows: § 734.4 De minimis U.S. content.

(a)* * *

(3)There is no *de minimis* level for foreign-made:

(i)Commercial primary or standby instrument systems of the type described in ECCN 7A994 on the Commerce Control List (Supplement No. 1 to part 774 the EAR) when the systems integrate QRS11-00100-100/101 Micromachined Angular Rate Sensors;

(ii)Commercial automatic flight control systems when the systems integrate QRS11-00050-443/569 Micromachined Angular Rate Sensors; and

(iii)Aircraft of the type described in ECCN 9A991 when such aircraft incorporate a primary or standby instrument system integrating a QRS11-00100-100/101 sensor or an automatic flight control system integrating a QRS11-00050-443/569 sensor. Note to paragraph (a)(3): QRS11 Micromachined Angular Rate Sensors are subject to the export licensing jurisdiction of the U.S. Department of State, Directorate of Defense Trade Controls, except when the QRS11-00100-100/101 version of the sensor is integrated into and included as an integral part of a commercial primary or standby instrument system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates a commercial primary or standby instrument that has such a sensor integrated, or is exported solely for integration into such systems; or when the QRS11-00050-443/569 is integrated into a commercial automatic flight control system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates an automatic flight control system that has such a sensor integrated, or is exported solely for integration into such a system. PART 774—[AMENDED] 3. The authority citation for 15 CFR Part 774 continues to read as follows: Authority: 50 U.S.C. app. 2401 *et seq.* ; 50 U.S.C. 1701 *et seq.* ; 10 U.S.C. 7420; 10 U.S.C. 7430(e); 22 U.S.C. 287c, 22 U.S.C. 3201 *et seq.* , 22 U.S.C. 6004; 30 U.S.C. 185(s), 185(u); 42 U.S.C. 2139a; 42 U.S.C. 6212; 43 U.S.C. 1354; 46 U.S.C. app. 466c; 50 U.S.C. app. 5; Sec. 901-911, Pub. L. 106-387; Sec. 221, Pub. L. 107-56; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007). 4. In Supplement No. 1 to part 774 (the Commerce Control List), Category 7—Navigation and Avionics, ECCN 7A994 is amended by revising the License Requirements section, and the “Related Controls” paragraph in the List of Items Controlled section, to read as follows: Supplement No. 1 to Part 774—The Commerce Control List **7A994 Other navigation direction finding equipment, airborne communication equipment, all aircraft inertial navigation systems not controlled under 7A003 or 7A103, and other avionic equipment, including parts and components, n.e.s.** License Requirements *Reason for Control:* RS, AT Control(s) Country chart RS applies to QRS11-00100-100/101 and QRS11-00050-443/569 RS Column 1. Micromachined Angular Rate Sensors. See Related Controls AT applies to entire entry AT Column 1. **License Requirement Notes:** There is no *de minimis* level for foreign-made commercial primary or standby instrument systems that integrate QRS11-00100-100/101 or commercial automatic flight control systems that integrate QRS11-00050-443/569 Micromachined Angular Rate Sensors (see § 734.4(a) of the EAR). List of Items Controlled *Unit:* * * * *Related Controls:* QRS11 Micromachined Angular Rate Sensors are subject to the export licensing jurisdiction of the U.S. Department of State, Directorate of Defense Trade Controls, unless the QRS11-00100-100/101 is integrated into and included as an integral part of a commercial primary or standby instrument system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates such systems, or is exported solely for integration into such a system; or the QRS11-00050-443/569 is integrated into an automatic flight control system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates such systems, or are exported solely for integration into such a system. (See Commodity Jurisdiction requirements in 22 CFR Parts 121; Category VIII(e), Note(1)) In the latter case, such items are subject to the licensing jurisdiction of the Department of Commerce. Technology specific to the development and production of QRS11 sensors remains subject to the licensing jurisdiction of the Department of State. *Related Definitions:* * * * *Items:* * * * 5. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Propulsion Systems, Space Vehicles and Related Equipment, ECCN 9A991 is amended by revising the “License Requirements Note” to the License Requirements section, and revising the “Related Controls” paragraph in the List of Items Controlled section, to read as follows: **9A991 “Aircraft”, n.e.s., and gas turbine engines not controlled by 9A001 or 9A101 and parts and components, n.e.s.** License Requirements *Reason for Control:* AT, UN Control(s) Country chart AT applies to entire entry. AT Column 1. UN applies to 9A991.a Iraq and Rwanda. **License Requirement Notes:** There is no de minimis level for foreign-made aircraft described by this entry that incorporate commercial primary or standby instrument systems that integrate QRS11-00100-100/101 or commercial automatic flight control systems that integrate QRS11-00050-443/569 Micromachined Angular Rate Sensors (see § 734.4(a) of the EAR). List of Items Controlled *Unit:* * * * *Related Controls:* QRS11 Micromachined Angular Rate Sensors are subject to the export licensing jurisdiction of the U.S. Department of State, Directorate of Defense Trade Controls, unless the QRS11-00100-100/101 is integrated into and included as an integral part of a commercial primary or standby instrument system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates such a system, or is exported solely for integration into such a system; or the QRS11-00050-443/569 is integrated into an automatic flight control system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates such a system, or are exported solely for integration into such a system. (See Commodity Jurisdiction requirements in 22 CFR Part 121; Category VIII(e), Note(1)) In the latter case, such items are subject to the licensing jurisdiction of the Department of Commerce. Technology specific to the development and production of QRS11 sensors remains subject to the licensing jurisdiction of the Department of State. *Related Definitions:* * * * *Items:* * * * Dated: October 23, 2007. Christopher A. Padilla, Assistant Secretary for Export Administration. [FR Doc. E7-21840 Filed 11-6-07; 8:45 am] BILLING CODE 3510-33-P DEPARTMENT OF HEALTH AND HUMAN SERVICES Food and Drug Administration 21 CFR Part 522 Implantation or Injectable Dosage Form New Animal Drugs; Ivermectin AGENCY: Food and Drug Administration, HHS. ACTION: Final rule. SUMMARY: The Food and Drug Administration

(FDA)is amending the animal drug regulations to reflect approval of a supplemental abbreviated new animal drug application (ANADA) filed by Norbrook Laboratories, Ltd. The supplemental ANADA adds claims for persistent effectiveness against various species of external and internal parasites when cattle are treated with a one percent ivermectin solution by subcutaneous injection. DATES: This rule is effective November 7, 2007. FOR FURTHER INFORMATION CONTACT: John K. Harshman, Center for Veterinary Medicine (HFV-104), Food and Drug Administration, 7500 Standish Pl., Rockville, MD 20855, 301-827-0169, e-mail: *john.harshman@fda.hhs.gov* . SUPPLEMENTARY INFORMATION: Norbrook Laboratories, Ltd., Station Works, Newry BT35 6JP, Northern Ireland, filed a supplement to ANADA 200-437 that provides for use of NOROMECTIN (ivermectin) Injection for Cattle and Swine. The supplemental ANADA adds claims for persistent effectiveness against various species of external and internal parasites of cattle. The supplemental ANADA is approved as of October 5, 2007, and the regulations are amended in 21 CFR 522.1192 to reflect the approval. In accordance with the freedom of information provisions of 21 CFR part 20 and 21 CFR 514.11(e)(2)(ii), a summary of safety and effectiveness data and information submitted to support approval of this application may be seen in the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852, between 9 a.m. and 4 p.m., Monday through Friday. The agency has determined under 21 CFR 25.33(a)(1) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required. This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808. List of Subjects in 21 CFR Part 522 Animal drugs. Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs and redelegated to the Center for Veterinary Medicine, 21 CFR part 522 is amended as follows: PART 522—IMPLANTATION OR INJECTABLE DOSAGE FORM NEW ANIMAL DRUGS 1. The authority citation for 21 CFR part 522 continues to read as follows: Authority: 21 U.S.C. 360b. 2. In § 522.1192, revise paragraph (b)(2) and add paragraph (b)(3) to read as follows: § 522.1192 Ivermectin.

(b)* * *

(2)No. 055529 for use of the product described in paragraph (a)(2) of this section as in paragraphs (e)(2)(i), (e)(2)(ii)(A), (e)(2)(ii)(C), (e)(2)(iii), (e)(3), (e)(4) and (e)(5) of this section.

(3)No. 059130 for use of the product described in paragraph (a)(2) of this section as in paragraphs (e)(2)(i), (e)(2)(ii)(A), (e)(2)(ii)(B), (e)(2)(iii), (e)(3), (e)(4), and (e)(5) of this section. Dated: October 26, 2007. Bernadette Dunham, Deputy Director, Center for Veterinary Medicine. [FR Doc. E7-21839 Filed 11-6-07; 8:45 am] BILLING CODE 4160-01-S DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1 and 301 [TD 9362] RIN 1545-BG23 Foreign Tax Credit: Notification of Foreign Tax Redeterminations AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Temporary regulations. SUMMARY: This document contains temporary Income Tax Regulations relating to a United States taxpayer's obligation under section 905(c) of the Internal Revenue Code

(Code)to notify the IRS of a foreign tax redetermination, which is a change in the taxpayer's foreign tax liability that may affect the taxpayer's foreign tax credit. This document also contains temporary Procedure and Administration Regulations under section 6689 relating to the civil penalty for failure to notify the IRS of a foreign tax redetermination as required under section 905(c). These temporary regulations affect taxpayers that have paid foreign taxes which have been redetermined and provide guidance needed to comply with statutory changes made to the applicable law by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004. The text of the temporary regulations also serves as the text of the proposed regulations (REG-209020-86) set forth in the notice of proposed rulemaking on this subject published elsewhere in this issue of the **Federal Register** . DATES: *Effective Date:* These regulations are effective on November 7, 2007. *Applicability Dates:* For dates of applicability, see §§ 1.905-3T(a), 1.905-4T(f), and 301.6689-1T(e). These regulations generally apply to foreign tax redeterminations occurring in taxable years of United States taxpayers beginning on or after November 7, 2007, where the foreign tax redetermination affects the amount of foreign taxes paid or accrued by a United States taxpayer. Where the redetermination of foreign tax paid or accrued by a foreign corporation affects the amount of foreign taxes deemed paid under section 902 or 960, this section applies to foreign tax redeterminations occurring in a taxable year of a foreign corporation which ends with or within the taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. Section 1.905-3T(b) generally applies to taxes paid or accrued in taxable years of United States taxpayers beginning on or after November 7, 2007 and to taxes paid or accrued by a foreign corporation in its taxable year which ends with or within the taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. For foreign tax redeterminations occurring in taxable years of United States taxpayers beginning before November 7, 2007 and foreign tax redeterminations occurring in taxable years of a foreign corporation which end with or within the taxable year of the domestic corporate shareholder beginning before November 7, 2007, see § 1.905-4T(f)(2). FOR FURTHER INFORMATION CONTACT: Teresa Burridge Hughes,

(202)622-3850 (not a toll-free call). SUPPLEMENTARY INFORMATION: Paperwork Reduction Act These temporary regulations are being issued without prior notice and public comment pursuant to the Administrative Procedure Act (5 U.S.C. 553). For this reason, the collections of information contained in these regulations have been reviewed and, pending receipt and evaluation of public comments, approved by the Office of Management and Budget under control number 1545-1056. Responses to this collection of information are mandatory. The collections of information in these temporary regulations are in § 1.905-4T. This information is required in order for taxpayers to notify the IRS of a foreign tax redetermination that may require redetermination of the taxpayer's United States tax liability. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number. For further information concerning these collections of information; where to submit comments on the collections of information and the accuracy of the estimated burden; and suggestions for reducing this burden, please refer to the preamble of the cross-referencing notice of proposed rulemaking published in this issue of the **Federal Register** . Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103. Background Under section 905(c) and the regulations, a taxpayer that claims a foreign tax credit for taxes paid or accrued under section 901 or deemed paid under section 902 or 960 must notify the IRS when there has been a change to the amount of foreign taxes paid or accrued. In general, in the case of a foreign tax redetermination with respect to taxes claimed as a direct credit under section 901, the taxpayer's United States tax liability must be redetermined; and, in the case of a foreign tax redetermination with respect to taxes included in the computation of foreign taxes deemed paid under section 902 or 960, the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes must be adjusted (subject to exceptions described in §§ 1.905-3T(d)(3) and (f)). If the taxpayer fails to notify the IRS of a foreign tax redetermination, unless it is shown that such failure is due to reasonable cause and not due to willful neglect, section 6689 imposes a penalty of 5 percent of the deficiency attributable to such redetermination if the failure is for not more than 1 month, with an additional 5 percent for each additional month during which the failure continues, but not to exceed 25 percent of the deficiency. On June 23, 1988, the **Federal Register** published proposed (53 FR 23659) (INTL-061-86) and temporary (53 FR 23611) (TD 8210) amendments to the Income Tax Regulations (26 CFR part 1) under section 905(c) and to the Procedure and Administration Regulations (26 CFR part 301) under section 6689 (the 1988 proposed and temporary regulations). These amendments reflected the changes made to the Internal Revenue Code by section 2(c)(2) of the Revenue Act of December 28, 1980 (94 Stat. 3503, 3509) and section 1261(a) of the Tax Reform Act of 1986 (100 Stat. 2085, 2591). The IRS and the Treasury Department received several written comments, which are discussed in this preamble. A public hearing concerning the proposed regulations was neither requested nor held. In response to written comments, on March 16, 1990, the IRS and the Treasury Department issued Notice 90-26, 1990-1 CB 336 (see § 601.601(d)(2)(ii)( *b* )), which suspended a portion of the temporary regulations, specifically § 1.905-3T(d)(2)(ii)(A) and that part of § 1.905-3T(d)(2)(ii)(C) which refers to that regulation, which provided rules for accounting for foreign tax redeterminations that affect the calculation of foreign taxes deemed paid with respect to distributions or inclusions out of post-1986 undistributed earnings of a foreign corporation. Section 1.905-3T(d)(2)(ii)(A) required that, in the case of a foreign tax redetermination that affects the amount of foreign taxes deemed paid by a United States corporation for a taxable year, if the foreign tax redetermination occurs more than 90 days before the due date (with extensions) of the taxpayer's income tax return for such taxable year and before the taxpayer actually files that return, then that taxpayer must adjust the foreign tax credit to be claimed on that return for such taxable year to account for the effect of the foreign tax redetermination. Alternatively, if a foreign tax redetermination occurs after the filing of the United States tax return, § 1.905-3T(d)(2)(ii)(B) provides that appropriate upward or downward adjustments are made at the time of the foreign tax redetermination to the pools of post-1986 foreign income taxes and post-1986 undistributed earnings of the foreign corporation. Section 1.905-3T(d)(2)(ii)(C) provides that, if the foreign tax redetermination occurs within 90 days of the due date of the United States tax return and before the taxpayer actually files its tax return, then the taxpayer may elect either to adjust the foreign tax credit to be claimed on that return in the manner described in § 1.905-3T(d)(2)(ii)(A) or adjust the pools of post-1986 foreign income taxes and post-1986 undistributed earnings to reflect the effect of the foreign tax redetermination in the manner described in § 1.905-3T(d)(2)(ii)(B). Comments received by the IRS and the Treasury Department concerning the requirement in § 1.905-3T(d)(2)(ii)(A) to notify the IRS of a foreign tax redetermination by adjusting the foreign tax credit on the return for the taxable year in which the foreign tax redetermination occurred stated that this requirement did not take into account the amount of time that taxpayers, especially large multinational corporations, need to prepare their income tax returns. In cases for which a foreign tax redetermination requires a redetermination of United States tax liability, § 1.905-4T provides rules generally requiring taxpayers to file amended returns to notify the IRS of the redetermination. Sections 1102(a)(1) and 1102(a)(2) of the Taxpayer Relief Act of 1997, Public Law 105-34 (111 Stat. 788, 963-966 (1997)), amended sections 986(a) and 905(c), respectively, effective for taxes paid or accrued in taxable years beginning after December 31, 1997. Section 905(c)(1)(B) was added to provide that, if accrued taxes are not paid before the date two years after the close of the taxable year to which such taxes relate, the taxpayer must notify the IRS and redetermine its United States tax liability for the year or years in which it claimed credit for such taxes. Section 986(a)(1)(A) was amended to provide that, for purposes of determining the amount of foreign tax credit, in the case of a taxpayer who takes foreign income taxes into account when accrued, the amount of any foreign income taxes (and any adjustment thereto) generally will be translated into dollars using the average exchange rate for the taxable year to which such taxes relate. However, under section 986(a)(1)(B), the spot exchange rate on the date the taxes are paid is used to translate foreign income taxes that are paid before, or more than two years after, the taxable year to which the taxes relate. Section 986(a)(1)(C) provides that, as determined under regulations, the average exchange rate also will not apply to taxes denominated in inflationary currencies. Subsequently, section 408(a) of the American Jobs Creation Act of 2004, Public Law 108-357 (118 Stat. 1418, 1499 (2004)), modified section 986(a) and provided, effective for taxable years beginning after December 31, 2004, that, at the election of the taxpayer, the average exchange rate will not apply to any foreign income taxes the liability for which is denominated in any currency other than in the taxpayer's functional currency. If the taxpayer so elects, taxes will be translated into dollars using the exchange rates at the time such taxes were paid to the foreign country. See section 986(a)(1)(D)(i). Section 986(a)(1)(D)(ii) provides that this election is also applicable to foreign income taxes attributable to a qualified business unit in accordance with regulations prescribed by the Secretary. On May 15, 2006, the IRS and the Treasury Department issued Notice 2006-47, 2006-20 IRB 892 (see § 601.601(d)(2)(ii)( *b* )), which provides interim rules with respect to this election. The notice provides that a taxpayer may elect to use the payment date exchange rates to translate all foreign income taxes, or it may elect to use the payment date exchange rates to translate only those nonfunctional currency foreign income taxes that are attributable to qualified business units with United States dollar functional currencies. Section 408(b)(1) of the American Jobs Creation Act of 2004 also added a special rule at section 986(a)(1)(E) for taxes paid by regulated investment companies. In light of the statutory changes to sections 905(c) and 986(a) by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004, the IRS and the Treasury Department believe it is appropriate to issue new proposed and temporary regulations. These new regulations make several significant changes to the rules of the 1988 proposed and temporary regulations to take into account statutory changes and the comments received on the 1988 proposed and temporary regulations, while leaving substantial portions of the 1988 proposed and temporary regulations unchanged. The new temporary regulations will permit the IRS to enforce properly sections 905(c) and 6689 without delay. The significant comments and revisions are described in this preamble. Explanation of Provisions I. Currency Translation Rules This document contains temporary Income Tax Regulations relating to the currency translation rules that apply in determining the amount of the foreign tax credit. Section 1.905-3T(b) has been revised to reflect the statutory changes to sections 905(c) and 986(a) by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004. New § 1.905-3T(b)(1)(i) provides that, in the case of a taxpayer or a member of a qualified group (as defined in section 902(b)(2)) that takes foreign income taxes into account when accrued, the amount of any foreign taxes denominated in foreign currency that have been paid or accrued, additional tax liability denominated in foreign currency, taxes withheld in foreign currency, or estimated taxes paid in foreign currency will be translated into dollars using the average exchange rate (as defined in § 1.989(b)-1) for the United States taxable year to which such taxes relate. However, new § 1.905-3T(b)(1)(ii) provides five exceptions to the general rule that accrual basis taxpayers translate foreign taxes using the average exchange rate. First, § 1.905-3T(b)(1)(ii)(A) provides that any foreign taxes denominated in foreign currency that were paid more than two years after the close of the United States taxable year to which they relate will be translated into dollars using the exchange rate as of the date of payment of the foreign taxes. Second, § 1.905-3T(b)(1)(ii)(B) provides that any foreign income taxes paid before the beginning of the United States taxable year to which such taxes relate will be translated into dollars using the exchange rate as of the date of payment of the foreign taxes. Third, § 1.905-3T(b)(1)(ii)(C) provides that any foreign income taxes the liability for which is denominated in any inflationary currency will be translated into dollars using the exchange rate as of the date of payment of the foreign taxes. For this purpose, the term *inflationary currency* means the currency of a country in which there is cumulative inflation during the base period of at least 30 percent, as determined by reference to the consumer price index of the country listed in the monthly issues of International Financial Statistics, or a successor publication, of the International Monetary Fund. For purposes of § 1.905-3T(b)(1)(ii)(C), *base period* means, with respect to any taxable year, the thirty-six calendar months immediately preceding the last day of such taxable year. See § 1.985-1(b)(2)(ii)(D). Fourth, under the provisions of § 1.905-3T(b)(1)(ii)(D), a taxpayer that is otherwise required to translate foreign income taxes that are denominated in foreign currency using the average exchange rate may elect to translate foreign income taxes into dollars using the exchange rate as of the date of payment of the foreign taxes, provided that the liability for such taxes is denominated in nonfunctional currency. This election may be made for all foreign income taxes or for only those foreign income taxes the liability for which is denominated in nonfunctional currency and that are attributable to qualified business units with United States dollar functional currencies. This election allows taxpayers to avoid a mismatch between the translated dollar amount of foreign tax credit and the translated dollar amount of the foreign income used to pay the tax. The election must be made by attaching a statement to the taxpayer's timely filed return (including extensions) for the first taxable year to which the election applies. The statement must identify whether the election is made for all foreign taxes or only for foreign taxes attributable to qualified business units with a United States dollar functional currency. Once made, the election will apply to the taxable year for which made and all subsequent taxable years unless revoked with the consent of the Commissioner. Finally, in the case of a regulated investment company (as defined in section 851 and the regulations under that section) which takes into account income on an accrual basis, § 1.905-3T(b)(1)(ii)(E) provides that foreign income taxes paid or accrued with respect to such income will be translated into dollars using the exchange rate as of the date the income accrues. This exception takes account of the special rule at section 852(b)(9) that requires a regulated investment company to take dividends into account on the ex-dividend date, rather than on the later date on which the dividends are paid (and the tax is actually withheld). The translation rule permits greater conformity between the translated dollar amount of dividends paid in foreign currency and the translated dollar amount of taxes withheld from such dividends. For a discussion of the effective dates of the currency translation provisions, see the “Effective Date” section of this document. Section 1.905-3T(b)(4), concerning the allocation of refunds of foreign tax to the separate categories of income under section 904(d), is not modified by these temporary regulations. Section 1.905-3T(b)(5), which provides rules with respect to the basis of foreign currency that is refunded, is revised to reflect the 1997 and 2004 changes to the currency translation rules, as provided in § 1.905-3T(b)(3). II. Definition of Foreign Tax Redetermination The term “foreign tax redetermination” in § 1.905-3T(c) has been revised to reflect the statutory changes made to section 905(c) in the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004. New § 1.905-3T(c) provides that, for purposes of §§ 1.905-3T and 1.905-4T, a foreign tax redetermination means a change in the foreign tax liability that may affect a taxpayer's foreign tax credit. A foreign tax redetermination includes:

(1)Accrued taxes that when paid differ from the amounts added to post-1986 foreign income taxes or claimed as credits by the taxpayer (such as corrections to overaccruals and additional payments);

(2)accrued taxes that are not paid before the date two years after the close of the taxable year to which such taxes relate;

(3)any tax paid that is refunded in whole or in part; and

(4)for taxes taken into account when accrued but translated into dollars on the date of payment, a difference between the dollar value of the accrued tax and the dollar value of the tax paid attributable to fluctuations in the value of the foreign currency relative to the dollar between the date of accrual and the date of payment. Section 1.905-3T(d)(1) has been revised to reflect the modified definition in new § 1.905-3T(c) of a foreign tax redetermination that results from currency fluctuations, but new § 1.905-3T(d)(1) otherwise adopts without amendment the rule in § 1.905-3T(d)(1) of the 1988 regulations that provides that no redetermination of United States tax liability is required with respect to such foreign tax redetermination if the amount of such redetermination is less than the lesser of ten thousand dollars or two percent of the total dollar amount of the foreign tax initially accrued with respect to that foreign country for the United States taxable year. Comments requested that this exception be broadened by eliminating the $10,000 limitation and by increasing the percentage ceiling from 2 percent to 5 percent, in order to increase the number of taxpayers eligible for the exception, therefore minimizing the administrative burden of filing amended returns for both taxpayers and the IRS. Since the 1988 temporary regulations were published, the administrative burdens of accounting for exchange rate fluctuations have been substantially reduced by the change in law allowing taxpayers claiming credits on the accrual basis to use annual average exchange rates rather than date of payment exchange rates to translate foreign tax. In addition, the IRS and Treasury Department believe that it is appropriate to limit the exception to a dollar threshold. Accordingly, this comment was not adopted. III. Adjustments to Pools of Post-1986 Undistributed Earnings and Post-1986 Foreign Income Taxes On March 16, 1990, Notice 90-26, 1990-1 CB 336 (see § 601.601(d)(2)(ii)( *b* )), suspended § 1.905-3T(d)(2)(ii)(A) and that part of § 1.905-3T(d)(2)(ii)(C) which refers to § 1.905-3T(d)(2)(ii)(A). Prior to its suspension, § 1.905-3T(d)(2)(ii)(A) required taxpayers to recompute the foreign tax credit claimed on their current year income tax return to account for foreign tax redeterminations that affect the amount of foreign tax deemed paid under section 902 or 960 and that occurred more than 90 days before the due date (with extensions) of the United States tax return for that taxable year and before the actual filing date. Section 1.905-3T(d)(2)(ii)(C) permitted taxpayers to elect to apply § 1.905-3T(d)(2)(ii)(A) to a foreign tax redetermination occurring within 90 days of the due date (with extensions) of the tax return for that taxable year and before the actual filing date. Section 1.905-3T(d)(2)(ii)(B) of the 1988 regulations requires that, if a foreign tax redetermination occurs after the filing of the United States tax return for such taxable year, then appropriate upward or downward adjustments will be made at the time of the foreign tax redetermination to the foreign corporation's pools of post-1986 foreign taxes and post-1986 earnings and profits to reflect the effect of the foreign tax redetermination in calculating foreign taxes deemed paid with respect to distributions and inclusions (and the amount of such distributions and inclusions) that are includible in taxable years subsequent to the taxable year for which such tax return is filed. The part of § 1.905-3T(d)(2)(ii)(C) not suspended by Notice 90-26 allows a taxpayer to elect to adjust the pools of post-1986 foreign taxes and post-1986 earnings and profits to reflect the effect of the foreign tax redetermination in the manner described in § 1.905-3T(d)(2)(ii)(B). Notice 90-26 also provided that, pending the issuance of final regulations under section 905(c), redeterminations otherwise subject to § 1.905-3T(d)(2)(ii)(A) or

(C)were required to be accounted for through adjustment to the appropriate pools of post-1986 earnings and profits and post-1986 foreign taxes in the manner described in § 1.905-3T(d)(3) and subject to the exceptions set forth in § 1.905-3T(d)(4). A comment concerning § 1.905-3T(d)(2) of the 1988 regulations was received, suggesting that taxpayers be allowed to elect to adjust earnings and profits and tax pools or file an immediate claim for refund, in the case of an additional assessment of foreign tax which generates a potential refund of U.S. tax. Because the taxpayer must wait for a subsequent distribution to benefit from the additional credits, the comment stated that the taxpayer is inappropriately denied an immediate benefit, that is, making a claim for an immediate refund, provided by section 6511(d)(3)(A). Subsequently, the Taxpayer Relief Act of 1997 confirmed the Secretary's regulatory authority to prescribe appropriate adjustments to a foreign corporation's pools of post-1986 foreign income taxes and post-1986 undistributed earnings in lieu of a redetermination, and amended section 905(c)(2) explicitly to provide that no redetermination of U.S. tax shall be made by reason of additional taxes paid more than two years after the year to which they relate. In light of the statutory changes, this comment was not adopted. Section 1.905-3T(d)(2) of the 1988 regulations has been revised to reflect the provisions of Notice 90-26. New § 1.905-3T(d)(2)(i) provides that appropriate upward or downward adjustments will be made at the time of the foreign tax redetermination to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes, in accordance with § 1.905-3T(d)(2)(ii), to reflect the effect of the foreign tax redetermination in calculating foreign taxes deemed paid with respect to subsequent distributions and inclusions (and the amount of such distributions and inclusions). Section 1.905-3T(d)(2)(iii) of the 1988 regulations, which provides rules with respect to the reporting requirements for adjustments to the appropriate pools of post-1986 undistributed earnings and post-1986 foreign income taxes has been revised. The 1988 regulations require that the domestic corporate shareholder attach notice of such adjustments to its return on a yearly basis. In the interest of reducing the reporting requirement burden, this notification requirement has been eliminated. New § 1.905-3T(d)(2)(i) refers to § 1.905-4T(b)(2), which provides that, where a redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960, and the taxpayer is required to adjust the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes under § 1.905-3T(d)(2), the taxpayer is required to notify the IRS of such redetermination by reflecting the adjustments to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes on a Form 1118 for the taxpayer's first taxable year with respect to which the redetermination affects the computation of foreign taxes deemed paid. The 1988 regulations provide four exceptions to the general rule in § 1.905-3T(d)(2) requiring pooling adjustments in lieu of a redetermination of United States tax liability to account for the effect of a redetermination of foreign tax paid or accrued by a foreign corporation on foreign taxes deemed paid under section 902 or 960. A shareholder-level redetermination of United States tax liability is required where the foreign tax liability is denominated in a hyperinflationary currency (see § 1.905-3T(d)(4)(i)); where the foreign tax redetermination occurs with respect to foreign taxes deemed paid with respect to a subpart F inclusion or an actual distribution which has the effect of reducing the foreign corporation's pool of post-1986 foreign income taxes below zero (see § 1.905-3T(d)(4)(iv)); or where a domestic corporate shareholder of a controlled foreign corporation receives a distribution out of previously taxed earnings and profits and a foreign country imposes tax on the foreign corporation's income, which tax is subsequently reduced (see § 1.905-3T(f)). These exceptions are adopted without amendment and have been moved to § 1.905-3T(d)(3)(i), (iv), and (vi), respectively, in the new temporary regulations. The fourth exception, at § 1.905-3T(d)(4)(ii) in the 1988 regulations, provides that if the foreign tax liability of a United States taxpayer is in a currency other than a hyperinflationary currency and the amount of foreign tax accrued for the taxable year to a foreign country, as measured in units of foreign currency, exceeds the amount of foreign tax paid to that foreign country for the taxable year by at least two percent, then the IRS, in its discretion, may require a redetermination of United States tax liability, in lieu of an adjustment of the pools of post-1986 undistributed earnings and post-1986 foreign income taxes. Section 1.905-3T(d)(2)(iii) of the 1988 regulations provides that, if a taxpayer may be required to redetermine its United States tax liability under § 1.905-3T(d)(4)(ii), the taxpayer must attach a notice of such adjustment to its return for the year with or within which ends the foreign corporation's taxable year during which the foreign tax redetermination occurs. Comments were received with respect to these provisions, requesting that the regulations set forth the factors the IRS would take into account in determining whether to exercise such discretion; the percentage limitation be increased to ten percent; the IRS not enforce this provision if the deficiency resulting from the overaccrual of foreign tax is less than $25,000; and the provision only be used in specific situations, such as consistent overaccrual of foreign taxes. Further, in order to avoid taxpayers being subject to the penalty under section 6689 for failure to notify the IRS within 180 days of the foreign tax redetermination, as required by § 1.905-4T(b)(2) of the 1988 regulations, a comment requested that, when the IRS exercises its discretion under § 1.905-3T(d)(4)(ii), the date on which such redetermination occurs should be deemed to be the date on which the IRS notifies the taxpayer that a redetermination of U.S. tax liability is required. In lieu of the discretionary rule in the 1988 temporary regulations, § 1.905-3T(d)(3)(ii) of the new regulations requires a redetermination of United States tax liability for all affected years if a foreign tax redetermination occurs with respect to foreign taxes paid by a foreign corporation and such foreign tax redetermination, if taken into account in the taxable year of the foreign corporation to which the foreign tax redetermination relates, has the effect of reducing by ten percent or more the foreign taxes deemed paid by the domestic corporate shareholder under section 902 or 960 in the taxable year of the shareholder with or within which ends the taxable year of the foreign corporation to which the foreign tax redetermination relates or in any intervening taxable year. Thus, a redetermination of the United States taxpayer's deemed paid credit under section 902 or 960 is required by reason of a foreign tax redetermination at the foreign subsidiary level only if the overstatement of the foreign tax credit is substantial in amount, taking into account the effect of the redetermination on the entire tax pool of the foreign subsidiary and not just the tax attributable to the year to which the redetermination relates. This new rule is more consistent with the other three exceptions to pooling adjustments in § 1.905-3T(d)(4)(i) and

(iv)and § 1.905-3T(f) of the 1988 temporary regulations, which are at new § 1.905-3T(d)(3)(i), (iv), and (vi). Further, § 1.905-3T(d)(3)(ii) of the new regulations provides consistent treatment among taxpayers, adds certainty as to when adjustments to prior-year section 902 or 960 credits are required, and reduces the administrative burden associated with yearly notification of such foreign tax redeterminations. A comment requested that the regulations be revised to address the situation where a controlled foreign corporation is sold. In a typical case, the seller of the controlled foreign corporation contracts to indemnify the buyer for any tax deficiencies arising with respect to taxable periods occurring prior to the date of the sale and will be entitled to any refunds relating to such periods. The additional assessments or refunds of tax are reflected as adjustments to the pools of the foreign corporation in the hands of the buyer but accrue economically to the seller. However, the seller derives no U.S. tax benefit or detriment from those additional payments or refunds because it no longer has an economic interest in the foreign corporation. It was suggested that the regulations should provide an additional exception to the pooling rules allowing recomputation of the seller's U.S. tax liability as if the foreign tax redetermination occurred immediately prior to the sale. The IRS and Treasury Department are continuing to study this issue and request comments on the potential scope of an additional exception to the pooling adjustment rules in the context of various types of acquisitions. Comments are also solicited on other changes that should be made to the 1988 temporary regulations, including changes relating to the statutory changes made by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004. IV. Time and Manner of Notification A. Overview of New Rules New § 1.905-4T(a) provides that if, as a result of a foreign tax redetermination (as defined in § 1.905-3T(c)), a redetermination of United States tax liability is required under section 905(c) and § 1.905-3T(d), the taxpayer must provide notification of the foreign tax redetermination. Section 1.905-4T(b)(1) of the new temporary regulations provides rules with respect to the time and manner of notifying the IRS of a foreign tax redetermination that necessitates a redetermination of United States tax liability. New § 1.905-4T(b)(1)(i) sets forth the general rule that, where a redetermination of United States tax liability is required, the taxpayer must notify the IRS by filing an amended return, Form 1118 (Foreign Tax Credit—Corporations) or 1116 (Foreign Tax Credit), and the statement required under § 1.905-4T(c) for the taxable year with respect to which a redetermination of United States tax liability is required. However, where a foreign tax redetermination requires an individual to redetermine the individual's United States tax liability, and as a result of such foreign tax redetermination the amount of creditable taxes paid or accrued by such individual during the taxable year does not exceed the applicable dollar limitation in section 904(k) (currently $300, or $600 in the case of a joint return), the individual will not be required to file Form 1116 with the amended return for such taxable year if the individual satisfies the requirements of section 904(k). B. Revision of 1988 Temporary Regulations in Response to Comments The 1988 temporary regulations at § 1.905-4T(b)(2) require taxpayers to notify the IRS of a foreign tax redetermination that reduced the amount of foreign taxes paid or deemed paid by filing an amended return for the affected year or years within 180 days after the date that the foreign tax redetermination occurred. The IRS and the Treasury Department received several comments suggesting that this rule was unduly burdensome to taxpayers. The comments noted that multiple foreign tax redeterminations requiring a redetermination of United States tax liability for the same taxable year would require the filing of multiple returns for such year, and that filing an amended Federal tax return would trigger additional state tax notification and amended return filing requirements. In light of these comments, the new temporary regulations at § 1.905-4T(b)(1)(ii) provide that, if a foreign tax redetermination reduced the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, a taxpayer must file a separate notification for each taxable year with respect to which a redetermination of United States tax liability is required by the due date (with extensions) of the original return for the taxable year in which the foreign tax redetermination occurred. With respect to a foreign tax redetermination that increased the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, new § 1.905-4T(b)(1)(iii) adopts the rule provided in the 1988 temporary regulations at § 1.905-4T(b)(2) and provides that the taxpayer must file a separate notification for each taxable year with respect to which a redetermination of United States tax liability is required within the period provided by section 6511(d)(3)(A). C. Special Rules for Certain Redeterminations The new temporary regulations at § 1.905-4T(b)(1)(iv) provide that, where more than one foreign tax redetermination requires a redetermination of United States tax liability for the same taxable year and those redeterminations occur within two consecutive taxable years of the taxpayer, the taxpayer may file for such taxable year one amended return, Form 1118 or 1116, and the statement required under § 1.905-4T(c) that reflect all such foreign tax redeterminations. If the taxpayer chooses to file one notification for such foreign tax redeterminations, the due date for such notification is the due date of the original return (with extensions) for the year in which the first foreign tax redetermination that reduced foreign tax liability occurred. However, because foreign tax redeterminations with respect to the taxable year for which a redetermination of United States tax liability is required may occur after the due date for providing such notification in the later of the two consecutive years, more than one amended return may be required with respect to that taxable year. Section 1.905-4T(b)(1)(v) of the new temporary regulations provides that, where a foreign tax redetermination requires a redetermination of United States tax liability that would otherwise result in an additional amount of United States tax due, but such amount is eliminated as a result of a carryback or carryover of an unused foreign tax under section 904(c), the taxpayer may, in lieu of applying the general notification rule described in § 1.905-4T(b)(1)(i) or (ii), notify the IRS by attaching a statement to the original return for the taxable year in which the foreign tax redetermination occurs. The statement must be filed by the due date (with extensions) of such return and contain the information described in § 1.904-2(f), including the amounts carried back or over to the year with respect to which a redetermination of United States tax liability is required. The 1988 temporary regulations at § 1.905-3T(d)(2)(iii) provide rules concerning the time, manner, and contents of the notification statement for an adjustment of a foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes due to a foreign tax redetermination. The new temporary regulations, at § 1.905-4T(b)(2), modify the reporting requirement with respect to such pooling adjustments by providing that where a redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960, and the taxpayer is required to adjust the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes under § 1.905-3T(d)(2), the taxpayer must notify the IRS of the redetermination by reflecting the adjustments to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes on a Form 1118 for the taxpayer's first taxable year with respect to which the redetermination affects the computation of foreign taxes deemed paid. New § 1.905-4T(b)(2) requires the taxpayer to file the Form 1118 by the due date (with extensions) of the original return for such taxable year. In the case of multiple redeterminations that affect the computation of foreign taxes deemed paid for the same taxable year and that are required to be reported under new § 1.905-4T(b)(2), a taxpayer may file one notification for all such redeterminations in lieu of filing a separate notification for each such redetermination. D. Large and Mid-Size Business Taxpayers Section 1.905-4T(b)(2) of the 1988 temporary regulations requires a taxpayer to notify the IRS of a foreign tax redetermination that reduced the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, by filing an amended return for the affected year within 180 days after the date that the foreign tax redetermination occurred. The IRS and the Treasury Department received several comments with respect to such rule suggesting that, in lieu of filing an amended return, taxpayers that are under continuous examination in a program such as the Coordinated Examination Program should be permitted to provide notice of foreign tax redeterminations to the examiner during an examination. Taking into account these comments, the new temporary regulations at § 1.905-4T(b)(3) provide that, where a redetermination of United States tax liability is required by reason of a foreign tax redetermination that occurs while a taxpayer is under the jurisdiction of the Large and Mid-Size Business Division and that results in a reduction in the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, the taxpayer must provide notice of such redetermination as part of the examination process in lieu of filing an amended return for the affected year as otherwise required by § 1.905-4T(b)(1)(i) and (ii). If the taxpayer is required under § 1.905-4T(b)(3) to provide notice as part of the examination process, the taxpayer must satisfy the requirements of § 1.905-4T(b)(3) (in lieu of the generally applicable rules of § 1.905-4T(b)(1)(i) or (ii)) in order not to be subject to the penalty under section 6689 and the regulations under that section. Section 1.905-4T(b)(3) of the new regulations requires a taxpayer to notify the IRS of the foreign tax redetermination by providing to the examiner a statement described in § 1.905-4T(c) during an examination of the return for the taxable year for which a redetermination of United States tax liability is required by reason of the foreign tax redetermination. The taxpayer must provide the statement to the examiner no later than 120 days after the latest of the date the foreign tax redetermination occurs, the opening conference, or the hand-delivery or postmark date of the opening letter concerning the examination. If, however, the foreign tax redetermination occurs more than 180 days after the latest of the opening conference or the hand-delivery or postmark date of the opening letter, the taxpayer may, in lieu of applying the rules of § 1.905-4T(b)(1)(i) and (ii), provide to the examiner a statement which complies with the requirements of § 1.905-4T(b)(3), and the IRS, in its discretion, may accept such statement or require the taxpayer to comply with the rules of § 1.905-4T(b)(1)(i) and (ii). This exception in § 1.905-4T(b)(3) to the generally applicable notification requirements of § 1.905-4T(b)(1) is not permitted to extend the length of the notification period set forth in § 1.905-4T(b)(1). In addition, no notification under § 1.905-4T(b)(3) will be due before May 5, 2008. V. Notification Contents Section 1.905-4T(c)(1) of the new temporary regulations requires the taxpayer to furnish a statement that contains information sufficient for the IRS to redetermine the taxpayer's United States tax liability where such a redetermination is required under section 905(c). The taxpayer must provide such information in a form that enables the IRS to verify and compare the original computations of the claimed foreign tax credit, the revised computations resulting from the foreign tax redetermination, and the net changes resulting therefrom. The statement must include the taxpayer's name, address, identifying number, and the taxable year or years of the taxpayer that are affected by the foreign tax redetermination. If the written statement is submitted to the IRS under § 1.905-4T(b)(3), which provides rules with respect to taxpayers under the jurisdiction of the Large and Mid-Size Business Division, the statement must also include a declaration under penalties of perjury. Where a redetermination of United States tax liability is required by reason of a foreign tax redetermination, new § 1.905-4T(c)(2) requires that the taxpayer provide, in addition to the information described in new § 1.905-4T(c)(1), specific information concerning the foreign tax redetermination. To take into account the amendment of section 986(a) (concerning translation rates for foreign taxes) by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004, the new temporary regulations require the taxpayer to provide the exchange rates used to translate the amount of foreign taxes paid, accrued, or refunded in accordance with § 1.905-3T(b) (as the case may be). These new temporary regulations also include the requirement of the 1988 temporary regulations that taxpayers provide information relating to the interest paid by foreign governments or owing to the United States due to a foreign tax redetermination. If, as a result of a redetermination of foreign tax paid or accrued by a foreign corporation, adjustments to the pools of post-1986 undistributed earnings and post-1986 foreign income taxes are required under § 1.905-3T(d)(2) of the 1988 temporary regulations in lieu of a redetermination of a domestic corporate shareholder's United States tax liability, § 1.905-3T(d)(2)(iii) of the 1988 temporary regulations requires that the taxpayer provide certain information concerning the foreign tax redetermination and the pooling adjustments. In order to reduce the notification requirement burden, the new temporary regulations modify this reporting requirement, as discussed above in section IV.C., “Special Rules for Certain Redeterminations.” If, as a result of a redetermination of foreign tax paid or accrued by a foreign corporation, a redetermination of United States tax liability is required under new § 1.905-3T(d)(3) in lieu of a pooling adjustment, the new temporary regulations at § 1.905-4T(c)(3) specify the information that the taxpayer must provide. VI. Payment or Refund of United States Tax, and Application of Interest and Penalties Section 1.905-4T(d) of the new temporary regulations adopts without amendment that portion of the 1988 temporary regulations at § 1.905-4T(b)(1) which provides that the amount of tax, if any, due upon a redetermination of United States tax liability will be paid by the taxpayer after notice and demand has been made by the IRS. The regulation also clarifies that deficiency procedures under Subchapter B of chapter 63 of the Internal Revenue Code will not apply with respect to the assessment of the amount due upon such redetermination, meaning that the IRS is not required to send a statutory notice of deficiency to a taxpayer, and the taxpayer does not have an opportunity to petition the Tax Court, prior to the IRS' assessment and collection of the amount of additional tax due. In accordance with sections 905(c) and 6501(c)(5), the statute of limitations under section 6501(a) will not apply to the assessment and collection of the amount of additional tax due. The amount of tax, if any, shown by a redetermination of United States tax liability to have been overpaid will be credited or refunded to the taxpayer in accordance with section 6511(d)(3)(A) and the provisions of § 301.6511(d)-3. Accordingly, the taxpayer must file a claim for credit or refund within ten years from the last date (without extensions) prescribed for filing the return for the taxable year in which the foreign taxes were actually paid or accrued. Similarly, § 1.905-4T(e) of the new temporary regulations adopts without amendment the interest and penalties provisions of the 1988 temporary regulations at § 1.905-4T(c). First, new § 1.905-4T(e)(1) provides that interest on the underpayment or overpayment resulting from a redetermination of United States tax liability will be computed in accordance with sections 6601 and 6611 and the regulations under those sections. No interest will be assessed or collected on any underpayment resulting from a refund of foreign tax for any period before the receipt of the refund, except to the extent interest was paid by the foreign country or possession of the United States on the refund for the period. In no case, however, will interest assessed and collected pursuant to the preceding sentence for any period before receipt of the refund exceed the amount that otherwise would have been assessed and collected under section 6601 and the regulations under that section for that period. Interest will be assessed from the time the taxpayer (or the foreign corporation of which the taxpayer is a shareholder) receives a foreign tax refund until the taxpayer pays the additional tax due the United States. Second, new § 1.905-4T(e)(2) provides that, if an adjustment to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes under § 1.905-3T(d)(2) is required in lieu of a redetermination of United States tax liability, no underpayment or overpayment of United States tax liability will result from a foreign tax redetermination. Consequently, no interest will be paid by or to a taxpayer as a result of adjustments to a foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes where required under § 1.905-3T(d)(2). Third, § 1.905-4T(e)(3) of the new temporary regulations provides that failure to comply with the provisions of § 1.905-4T of the new temporary regulations will subject the taxpayer to the penalty provisions of section 6689 and the regulations under that section. VII. Foreign Tax Redeterminations With Respect to Pre-1987 Accumulated Profits Section 1.905-5T of the 1988 regulations provides rules relating to foreign tax redeterminations occurring in pre-1987 taxable years, and those occurring in post-1986 taxable years with respect to pre-1987 accumulated profits. The new temporary regulations amend the cross-references to §§ 1.905-3T and 1.905-4T and clarify that these rules apply to foreign tax redeterminations with respect to pre-1987 accumulated profits that are accumulated in taxable years of a foreign corporation beginning after December 31, 1986, but before the first taxable year in which the ownership requirements of section 902 are met. See § 1.902-1(a)(10)(i). VIII. Penalty Under Section 6689 Under section 6689, a taxpayer that fails to notify the IRS of a foreign tax redetermination in the time and manner prescribed by regulations for giving such notice is subject to a penalty unless it is shown that such failure is due to reasonable cause and not due to willful neglect. Section 6689(a) provides that the penalty is calculated by adding to the deficiency attributable to the foreign tax redetermination an amount equal to 5 percent of the deficiency if the failure is for not more than 1 month, plus an additional 5 percent of the deficiency for each month (or fraction thereof) during which the failure continues. The total amount of the penalty is not to exceed 25 percent of the deficiency. Section 301.6689-1T(a) has been revised to clarify that deficiency proceedings under Subchapter B of chapter 63 of the Code will not apply with respect to the amount of such penalty, meaning that the IRS is not required to send a statutory notice of deficiency to a taxpayer, and the taxpayer does not have an opportunity to petition the Tax Court, prior to the IRS' assessment and collection of the amount of such penalty. Comments were received suggesting that, in computing the amount of the penalty, an overpayment resulting from one foreign tax redetermination should offset an underpayment resulting from another foreign tax redetermination where both foreign tax redeterminations arise from the same foreign taxing jurisdiction and require a redetermination of United States tax liability for the same taxable year. Thus, the commentators suggested, where the underpayment is completely offset by one or more overpayments, the section 6689 penalty should not apply. Because the penalty is determined with respect to a deficiency attributable to such redetermination, there must be some deficiency for the penalty to apply. Where underpayments and overpayments offset each other to reduce or eliminate a deficiency, any penalty under section 6689 would also be reduced or eliminated. The IRS and Treasury Department do not believe an amendment to the regulations is necessary to clarify this rule. Another comment was received suggesting that the section 6689 penalty generally should be inapplicable to Coordinated Exam Program taxpayers, provided that a notice of foreign tax redeterminations is submitted by the taxpayer at the commencement of the audit. Such a suggestion is generally adopted at § 1.905-4T(b)(3). A further comment requested that the definition of reasonable care under the regulations be revised. The 1988 regulations provide that, if a taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the notification within the prescribed time, then the delay will be considered to be due to reasonable cause and not willful neglect. The comment recommended instead adopting a more objective test based on substantial compliance. This comment is rejected because ordinary business care and prudence is the general standard for reasonable care that is used in the regulations for other penalties. Effective/Applicability Date The new temporary regulations of §§ 1.905-3T(c) and

(d)and 1.905-4T are generally applicable for foreign tax redeterminations occurring in taxable years of United States taxpayers beginning on or after November 7, 2007 where the redetermination affects the amount of foreign taxes paid or accrued by a United States taxpayer. Where the redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960 with respect to post-1986 undistributed earnings (or pre-1987 accumulated profits) of the foreign corporation, the new temporary regulations of §§ 1.905-3T(c) and (d), 1.905-4T, and 1.905-5T are generally effective for foreign tax redeterminations occurring in taxable years of a foreign corporation which end with or within a taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. See § 1.905-4T(f)(1). In no case, however, will § 1.905-4T(f) operate to extend the statute of limitations provided by section 6511(d)(3)(A). Section 1.905-3T(b), which provides rules with respect to currency translation, generally is applicable for taxes paid or accrued in taxable years of United States taxpayers beginning on or after November 7, 2007 and to taxes paid or accrued by a foreign corporation in its taxable years which end with or within a taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. For taxable years beginning after December 31, 1997, and before November 7, 2007, section 986(a), as amended by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004, shall apply. For taxable years beginning after December 31, 1986, and prior to the effective date of the Taxpayer Relief Act of 1997 (January 1, 1998), § 1.905-3T of the 1988 temporary regulations shall apply. Section 1.905-3T(b)(1)(ii)(D), which provides taxpayers otherwise required to translate foreign income taxes using the average exchange rate an election to translate taxes using the exchange rate for the date of payment, is applicable for taxable years beginning on or after November 7, 2007. For taxable years beginning after December 31, 2004, and before November 7, 2007, the rules of Notice 2006-47, 2006-20 IRB 892 (see § 601.601(d)(2)(ii)( *b* )), shall apply. Although all foreign tax redeterminations occurring in taxable years beginning after December 31, 1986, are subject to the requirements of section 905(c) and the regulations under that section, the 1988 temporary regulations did not specify the date by which the required notifications must be made in order to avoid a penalty under section 6689. The IRS and the Treasury Department recognize the burden associated with requiring notification by a specific date of all previously-unreported foreign tax redeterminations that require a United States tax redetermination with respect to post-1986 taxable years. Consequently, the new temporary regulations at § 1.905-4T(f)(2) provide a specific due date only for notifications of foreign tax redeterminations that occurred in a taxpayer's three taxable years preceding the first taxable year identified in § 1.905-4T(f)(1), and taxable years of foreign corporations ending with or within such taxable years of their domestic corporate shareholders. However, the unlimited statute of limitations under section 905(c) and deficiency interest provisions continue to apply to any underpayment of United States tax attributable to a foreign tax redetermination. Section 1.905-4T(f)(2)(ii) provides notification requirements for any foreign tax redetermination which occurred in the last taxable year of a United States taxpayer beginning before November 7, 2007 and the two immediately preceding taxable years and which reduced the amount of foreign taxes paid or accrued by the taxpayer for any taxable year. This section also requires notification of any redetermination of foreign taxes paid or accrued by a foreign corporation which occurred in a taxable year of the foreign corporation which ends with or within a taxable year of a domestic corporate shareholder described in the preceding sentence and which requires a redetermination of United States tax liability under § 1.905-3T(d)(3) for any taxable year. If, as of November 7, 2007, the taxpayer has not satisfied the notice requirements described in §§ 1.905-3T and 1.905-4T of the 1988 temporary regulations with respect to such foreign tax redeterminations, the new temporary regulations at § 1.905-4T(f)(2)(ii) generally require the taxpayer to notify the IRS of such foreign tax redetermination no later than the due date (with extensions) of its original return for the taxable year following the taxable year in which these regulations are first effective. New § 1.905-4T(f)(2)(ii) sets forth the time and manner of the notification, which must contain the previously-unreported information described in new § 1.905-4T(c). The temporary regulations do not require notification of previously-unreported foreign tax redeterminations of a foreign corporation that occurred in taxable years of the foreign corporation that ended with or within a domestic corporate shareholder's taxable year beginning before November 7, 2007, if the foreign tax redetermination does not require a redetermination of United States tax liability but is accounted for by adjusting the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes. New § 1.905-4T(f)(2)(iii) provides that a taxpayer under the jurisdiction of the Large and Mid-Size Business Division that is otherwise required to file an amended return, Form 1118, and the statement required under § 1.905-4T(c) as required in new § 1.905-4T(f)(2)(ii) may, in lieu of applying § 1.905-4T(f)(2)(ii), notify the IRS in the course of an examination of the return for the taxable year for which a redetermination of United States tax liability is required. In such case, the notification must contain the information described in new § 1.905-4T(c) and must be provided within 120 days after the latest of the opening conference or the hand-delivery or postmark date of the opening letter concerning an examination of the return for the taxable year for which a redetermination of United States tax liability is required or May 5, 2008, whichever is later. However, if November 7, 2007 is more than 180 days after the latest of the opening conference or the hand-delivery or postmark date of the opening letter, the IRS, in its discretion, may accept such statement or require the taxpayer to comply with the rules of paragraph (f)(2)(ii) of this section. In addition, this exception to the notification requirements of § 1.905-4T(f)(2)(ii) is not permitted to extend the length of the notification period set forth in § 1.905-4T(f)(2)(ii). Therefore, § 1.905-4T(f)(2)(iii) will not apply if the last day for providing notice of the foreign tax redetermination under § 1.905-4T(f)(2)(ii) precedes the latest of the opening conference or the hand-delivery or postmark date of the opening letter concerning an examination of the return for the taxable year for which a redetermination of United States tax liability is required. Section 1.905-4T(f)(2)(iv) provides that interest will be computed in accordance with § 1.905-4T(e), and that the taxpayer must satisfy the requirements of § 1.905-4T(f)(2) in order not to be subject to the penalty provisions of section 6689 and the regulations under that section. Special Analyses It has been determined that this Treasury decision is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. For the applicability of the Regulatory Flexibility Act (5 U.S.C. chapter 6), refer to the Special Analyses section of the preamble of the cross-referenced notice of proposed rulemaking published in this issue of the **Federal Register** . Pursuant to section 7805(f) of the Internal Revenue Code, this regulation has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small businesses. Drafting Information The principal author of these regulations is Teresa Burridge Hughes of the Office of Associate Chief Counsel (International). However, other personnel from the IRS and Treasury Department participated in their development. List of Subjects 26 CFR Part 1 Income taxes, Reporting and recordkeeping requirements. 26 CFR Part 301 Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income taxes, Penalties, Reporting and recordkeeping requirements. Adoption of Amendments to the Regulations Accordingly, 26 CFR parts 1 and 301 are amended as follows: PART 1—INCOME TAXES **Paragraph 1.** The authority for part 1 continues to read in part as follows: Authority: 26 U.S.C. 7805 * * * **Par. 2.** Section 1.905-3T is amended as follows: 1. Revise the section heading and paragraphs (a), (b)(1), (b)(2), (b)(3), (b)(5), (c), and (d)(2)(i). 2. Revise the second and third sentences in paragraph (d)(1). 3. Remove paragraphs (d)(2)(ii), (d)(2)(iii), (d)(2)(iv), the heading for paragraph (d)(3), and paragraph (d)(3)(i). 4. Redesignate paragraphs (d)(3), (d)(3)(ii), (d)(3)(iii), (d)(3)(iv), and (d)(3)(v) as paragraph (d)(2)(ii), (d)(2)(ii)(A), (d)(2)(ii)(B), (d)(2)(ii)(C), and (d)(2)(ii)(D), respectively. 5. Add a new paragraph heading to newly-designated paragraph (d)(2)(ii). 6. Revise newly-designated paragraphs (d)(2)(ii)(A), (d)(2)(ii)(B), and (d)(2)(ii)(D). 7. Remove the language “(d)(3)(iv)” from the second to last sentence of newly-designated paragraph (d)(2)(ii)(C) and add the language “(d)(2)(ii)(C)” in its place. Remove the language “§ 1.905-3T(d)(4)(iv)” from the last sentence of newly-designated paragraph (d)(2)(ii)(C) and add the language “paragraph (d)(3)(iv) of this section” in its place. 8. Redesignate paragraph (d)(4) as paragraph (d)(3). 9. Remove the language “(d)(4)” from newly-designated paragraph (d)(3) and add the language “(d)(3)” in its place. 10. Revise newly-designated paragraphs (d)(3)(ii), (d)(3)(iii), and (d)(3)(v). 11. Redesignate paragraph

(f)as paragraph (d)(3)(vi). 12. Add a new paragraph (f). The revisions and additions read as follows: § 1.905-3T Adjustments to United States tax liability and to the pools of post-1986 undistributed earnings and post-1986 foreign income taxes as a result of a foreign tax redetermination (temporary).

(a)*Effective/applicability dates—*

(1)*Currency translation.* Except as provided in § 1.905-5T, paragraph

(b)of this section applies to taxes paid or accrued in taxable years of United States taxpayers beginning on or after November 7, 2007 and to taxes paid or accrued by a foreign corporation in its taxable years which end with or within a taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. For taxable years beginning after December 31, 1997, and before November 7, 2007, section 986(a), as amended by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004, shall apply. For taxable years beginning after December 31, 1986, and before January 1, 1998, § 1.905-3T (as contained in 26 CFR part 1, revised as of April 1, 2007) shall apply.

(2)*Foreign tax redeterminations* . Paragraphs

(c)and

(d)of this section apply to foreign tax redeterminations occurring in taxable years of United States taxpayers beginning on or after November 7, 2007 where the foreign tax redetermination affects the amount of foreign taxes paid or accrued by a United States taxpayer. Where the redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960 with respect to post-1986 undistributed earnings of the foreign corporation, paragraphs

(c)and

(d)of this section apply to foreign tax redeterminations occurring in taxable years of a foreign corporation which end with or within a taxable year of the domestic corporate shareholder beginning on or after November 7, 2007. For corresponding rules applicable to foreign tax redeterminations occurring in taxable years beginning before November 7, 2007, see §§ 1.905-3T and 1.905-5T (as contained in 26 CFR part 1, revised as of April 1, 2007).

(b)*Currency translation rules—*

(1)*Translation of foreign taxes taken into account when accrued—*

(i)*In general* . Except as provided in paragraph (b)(1)(ii) of this section, in the case of a taxpayer or a member of a qualified group (as defined in section 902(b)(2)) that takes foreign income taxes into account when accrued, the amount of any foreign taxes denominated in foreign currency that have been paid or accrued, additional tax liability denominated in foreign currency, taxes withheld in foreign currency, or estimated taxes paid in foreign currency shall be translated into dollars using the average exchange rate (as defined in § 1.989(b)-1) for the United States taxable year to which such taxes relate.

(ii)*Exceptions—*

(A)*Taxes not paid within two years* . Any foreign income taxes denominated in foreign currency that are paid more than two years after the close of the United States taxable year to which they relate shall be translated into dollars using the exchange rate as of the date of payment of the foreign taxes. To the extent any accrued foreign income taxes denominated in foreign currency remain unpaid two years after the close of the taxable year to which they relate, see paragraph (b)(3) of this section for translation rules for the required adjustments.

(B)*Taxes paid before taxable year begins* . Any foreign income taxes paid before the beginning of the United States taxable year to which such taxes relate shall be translated into dollars using the exchange rate as of the date of payment of the foreign taxes.

(C)*Inflationary currency* . Any foreign income taxes the liability for which is denominated in any inflationary currency shall be translated into dollars using the exchange rate as of the date of payment of the foreign taxes. For this purpose, the term *inflationary currency* means the currency of a country in which there is cumulative inflation during the base period of at least 30 percent, as determined by reference to the consumer price index of the country listed in the monthly issues of International Financial Statistics, or a successor publication, of the International Monetary Fund. For purposes of this paragraph (b)(1)(ii)(C), *base period* means, with respect to any taxable year, the thirty-six calendar months immediately preceding the last day of such taxable year (see § 1.985-1(b)(2)(ii)(D)). Accrued but unpaid taxes denominated in an inflationary currency shall be translated into dollars at the exchange rate on the last day of the United States taxable year to which such taxes relate.

(D)*Election to translate taxes using exchange rate for date of payment* . A taxpayer that is otherwise required to translate foreign income taxes that are denominated in foreign currency using the average exchange rate may elect to translate foreign income taxes described in this paragraph (b)(1)(ii)(D) into dollars using the exchange rate as of the date of payment of the foreign taxes, provided that the liability for such taxes is denominated in nonfunctional currency. A taxpayer may make an election under this paragraph (b)(1)(ii)(D) for all foreign income taxes, or for only those foreign income taxes that are denominated in nonfunctional currency and are attributable to qualified business units with United States dollar functional currencies. The election must be made by attaching a statement to the taxpayer's timely filed return (including extensions) for the first taxable year to which the election applies. The statement must identify whether the election is made for all foreign taxes or only for foreign taxes attributable to qualified business units with United States dollar functional currencies. Once made, the election shall apply for the taxable year for which made and all subsequent taxable years unless revoked with the consent of the Commissioner. Accrued but unpaid taxes subject to an election under this paragraph (b)(1)(ii)(D) shall be translated into dollars at the exchange rate on the last day of the United States taxable year to which such taxes relate. For taxable years beginning after December 31, 2004, and before November 7, 2007, the rules of Notice 2006-47, 2006-20 IRB 892 (see § 601.601(d)(2)(ii)( *b* )), shall apply.

(E)*Regulated investment companies.* In the case of a regulated investment company (as defined in section 851 and the regulations under that section) which takes into account income on an accrual basis, foreign income taxes paid or accrued with respect to such income shall be translated into dollars using the exchange rate as of the date the income accrues.

(2)*Translation of foreign taxes taken into account when paid.* In the case of a taxpayer that takes foreign income taxes into account when paid, the amount of any foreign tax liability denominated in foreign currency, additional tax liability denominated in foreign currency, or estimated taxes paid in foreign currency shall be translated into dollars using the exchange rate as of the date of payment of such foreign taxes. Foreign taxes withheld in foreign currency shall be translated into dollars using the exchange rate as of the date on which such taxes were withheld.

(3)*Refunds or other reductions of foreign tax liability.* In the case of a taxpayer that takes foreign income taxes into account when accrued, a reduction in the amount of previously-accrued foreign taxes that is attributable to a refund of foreign taxes denominated in foreign currency, a credit allowed in lieu of a refund, the correction of an overaccrual, or an adjustment on account of accrued taxes denominated in foreign currency that were not paid by the date two years after the close of the taxable year to which such taxes relate, shall be translated into dollars using the exchange rate that was used to translate such amount when originally claimed as a credit or added to post-1986 foreign income taxes. In the case of foreign income taxes taken into account when accrued but translated into dollars on the date of payment, see paragraph

(d)of this section for required adjustments to reflect a reduction in the amount of previously-accrued foreign taxes that is attributable to a difference in exchange rates between the date of accrual and date of payment. In the case of a taxpayer that takes foreign income taxes into account when paid, a refund or other reduction in the amount of foreign taxes denominated in foreign currency shall be translated into dollars using the exchange rate that was used to translate such amount when originally claimed as a credit. If a refund or other reduction of foreign taxes relates to foreign taxes paid or accrued on more than one date, then the refund or other reduction shall be deemed to be derived from, and shall reduce, the last payment of foreign taxes first, to the extent of that payment. See paragraphs (d)(1) (redetermination of United States tax liability for foreign taxes paid directly by a United States person) and (d)(2)(ii) (method of adjustment of a foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes) of this section.

(5)*Basis of foreign currency refunded—*

(i)*In general.* A recipient of a refund of foreign tax shall determine its basis in the currency refunded under the following rules.

(ii)*United States dollar functional currency.* If the functional currency of the qualified business unit

(QBU)(as defined in section 989 and the regulations under that section) that paid the tax and received the refund is the United States dollar or the person receiving the refund is not a QBU, then the recipient's basis in the foreign currency refunded shall be the dollar value of the refund determined under paragraph (b)(3) of this section by using, as appropriate, either the average exchange rate for the taxable year to which such taxes relate or the other exchange rate that was used to translate such amount when originally claimed as a credit or added to post-1986 foreign income taxes.

(iii)*Nondollar functional currency.* If the functional currency of the QBU receiving the refund is not the United States dollar and is different from the currency in which the foreign tax was paid, then the recipient's basis in the foreign currency refunded shall be equal to the functional currency value of the non-functional currency refund translated into functional currency at the exchange rate between the functional currency and the non-functional currency. Such exchange rate is determined under paragraph (b)(3) of this section by substituting the words “functional currency” for the word “dollar” and by using, as appropriate, either the average exchange rate for the taxable year to which such taxes relate or the other exchange rate that was used to translate such amount when originally claimed as a credit or added to post-1986 foreign income taxes.

(iv)*Functional currency tax liabilities.* If the functional currency of the QBU receiving the refund is the currency in which the refund was made, then the recipient's basis in the currency received shall be the amount of the functional currency received.

(v)*Foreign currency gain or loss.* For purposes of determining foreign currency gain or loss on the initial payment of accrued foreign tax in a non-functional currency, see section 988. For purposes of determining subsequent foreign currency gain or loss on the disposition of non-functional currency the basis of which is determined under this paragraph (b)(5), see section 988(c)(1)(C).

(c)*Foreign tax redetermination.* For purposes of this section and § 1.905-4T, the term *foreign tax redetermination* means a change in the foreign tax liability that may affect a taxpayer's foreign tax credit. A foreign tax redetermination includes: accrued taxes that when paid differ from the amounts added to post-1986 foreign income taxes or claimed as credits by the taxpayer (such as corrections to overaccruals and additional payments); accrued taxes that are not paid before the date two years after the close of the taxable year to which such taxes relate; any tax paid that is refunded in whole or in part; and, for taxes taken into account when accrued but translated into dollars on the date of payment, a difference between the dollar value of the accrued tax and the dollar value of the tax paid attributable to fluctuations in the value of the foreign currency relative to the dollar between the date of accrual and the date of payment.

(d)* * *

(1)* * * See § 1.905-4T(b) which requires notification to the IRS of a foreign tax redetermination with respect to which a redetermination of United States liability is required, and see section 905(b) and the regulations under that section which require that a taxpayer substantiate that a foreign tax was paid and provide all necessary information establishing its entitlement to the foreign tax credit. However, a redetermination of United States tax liability is not required (and a taxpayer need not notify the IRS) if the foreign taxes are taken into account when accrued but translated into dollars as of the date of payment, the difference between the dollar value of the accrued tax and the dollar value of the tax paid is attributable to fluctuations in the value of the foreign currency relative to the dollar between the date of accrual and the date of payment, and the amount of the foreign tax redetermination with respect to each foreign country is less than the lesser of ten thousand dollars or two percent of the total dollar amount of the foreign tax initially accrued with respect to that foreign country for the United States taxable year. * * *

(2)*Foreign taxes deemed paid under sections 902 or 960—*

(i)*Redetermination of United States tax liability not required.* Subject to the special rule of paragraph (d)(3) of this section, a redetermination of United States tax liability is not required to account for the effect of a redetermination of foreign tax paid or accrued by a foreign corporation on the foreign taxes deemed paid by a United States corporation under section 902 or 960. Instead, appropriate upward or downward adjustments shall be made, in accordance with paragraph (d)(2)(ii) of this section, at the time of the foreign tax redetermination to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes to reflect the effect of the foreign tax redetermination in calculating foreign taxes deemed paid with respect to distributions and inclusions (and the amount of such distributions and inclusions) that are includible in the United States taxable year in which the foreign tax redetermination occurred and subsequent taxable years. See § 1.905-4T(b)(2) for notification requirements where a redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960, and the taxpayer is required to adjust the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes under this paragraph (d)(2).

(ii)*Adjustments to the pools of post-1986 undistributed earnings and post-1986 foreign income taxes—*

(A)*Reduction in foreign tax paid or accrued.* A foreign corporation's pool of post-1986 foreign income taxes in the appropriate separate category shall be reduced by the United States dollar amount of a foreign tax refund or other reduction in the amount of foreign tax paid or accrued, translated into United States dollars as provided in paragraph (b)(3) of this section. A foreign corporation's pool of post-1986 undistributed earnings in the appropriate separate category shall be increased by the functional currency amount of the foreign tax refund or other reduction in the amount of foreign tax paid or accrued. The allocation of the refund or other adjustment to the appropriate separate categories shall be made in accordance with paragraph (b)(4) of this section and § 1.904-6. If a foreign corporation receives a refund of foreign tax in a currency other than its functional currency, that refund shall be translated into its functional currency, for purposes of computing the increase to its pool of post-1986 undistributed earnings, at the exchange rate between the functional currency and the non-functional currency, as determined under paragraph (b)(3) of this section, by substituting the words “functional currency” for the word “dollar” and by using the same average or spot rate exchange rate convention that applies for purposes of translating such foreign taxes into United States dollars.

(B)*Additional foreign tax paid or accrued.* A foreign corporation's pool of post-1986 foreign income taxes in the appropriate separate category shall be increased by the United States dollar amount of the additional foreign tax paid or accrued, translated in accordance with the rules of paragraphs (b)(1) and (b)(2) of this section. A foreign corporation's pool of post-1986 undistributed earnings in the appropriate separate category shall be decreased by the functional currency amount of the additional foreign tax paid or accrued. The allocation of the additional amount of foreign tax among the separate categories shall be made in accordance with § 1.904-6. If a foreign corporation pays or accrues foreign tax in a currency other than its functional currency, that tax shall be translated into its functional currency, for purposes of computing the decrease to its pool of post-1986 undistributed earnings, at the exchange rate between the functional currency and the non-functional currency, as determined under paragraph (b)(3) of this section, by substituting the words “functional currency” for the word “dollar” and by using the same average or spot rate exchange rate convention that applies for purposes of translating such foreign taxes into United States dollars.

(D)*Examples.* The following examples illustrate the application of this paragraph (d)(2): Example 1. Controlled foreign corporation

(CFC)is a wholly-owned subsidiary of its domestic parent, P. Both CFC and P are calendar year taxpayers. CFC has a functional currency, the u, other than the dollar and its pool of post-1986 undistributed earnings is maintained in that currency. CFC and P use the average exchange rate to translate foreign taxes. In 2008, CFC accrued and paid 100u of foreign income taxes with respect to non-subpart F income. The average exchange rate for 2008 was $1:1u. In 2009, CFC received a refund of 50u of foreign taxes with respect to its non-subpart F income in 2008. CFC made no distributions to P in 2008. In accordance with paragraph (d)(2)(ii)(A) of this section and subject to paragraph (d)(3) of this section, in 2009 CFC's pool of post-1986 foreign income taxes must be reduced by $50 (because the refund must be translated into dollars using the exchange rate that was used to translate such amount when added to CFC's post-1986 foreign income taxes, that is, $1:1u, the average exchange rate for 2008) and the CFC's pool of post-1986 undistributed earnings must be increased by 50u (because the post-1986 undistributed earnings must be increased by the functional currency amount of the refund received). An income adjustment reflecting foreign currency gain or loss under section 988 with respect to the refund of foreign taxes received by CFC is not required because the foreign taxes are denominated and paid in CFC's functional currency. Example 2. The facts are the same as in *Example 1,* except that in 2008, CFC had general category post-1986 undistributed earnings attributable to non-subpart F income of 200u (net of foreign taxes), and CFC accrued and paid 160u in foreign income taxes with respect to those earnings. The average exchange rate for 2008 was $1:1u. Also in 2008, CFC made a distribution to P of 50u, and P was deemed to have paid $40 of foreign taxes with respect to that distribution (50u/200u × $160). In 2009, CFC received a refund of foreign taxes of 5u with respect to its nonsubpart F income in 2008. Also in 2009, CFC made a distribution to P of 50u. CFC had no income and paid no foreign taxes in 2009. In accordance with paragraph (d)(2)(ii) of this section, CFC's pool of general category post-1986 foreign income taxes is reduced in 2009 by $5 to $115 (because the refund must be translated into dollars using the exchange rate that was used to translate such amount when added to CFC's post-1986 foreign income taxes, that is, $1:1u, the average exchange rate for 2008), and CFC's pool of general category post-1986 undistributed earnings must be increased in 2009 by 5u to 155u (because the post-1986 undistributed earnings must be increased by the functional currency amount of the refund received). (An income adjustment reflecting foreign currency gain or loss under section 988 with respect to the refund of foreign taxes received by CFC is not required because the foreign taxes are denominated and paid in CFC's functional currency.) A redetermination of P's deemed paid credit and U.S. tax for 2008 is not required, because the 5u refund, if taken into account in 2008, would have reduced P's deemed paid taxes by less than 10% (50u/205u × $155 = $37.80). See paragraph (d)(3)(ii) of this section. P is deemed to pay $37.10 of foreign taxes with respect to the distribution in 2009 of 50u (50u/155u × $115). Example 3.

(i)CFC1 is a foreign corporation that is wholly-owned by P, a domestic corporation. CFC2 is a foreign corporation that is wholly-owned by CFC1. The functional currency of CFC1 and CFC2 is the u, and the pools of post-1986 undistributed earnings of CFC1 and CFC2 are maintained in that currency. CFC1, CFC2, and P use the average exchange rate to translate foreign income taxes. In 2008, CFC2 had post-1986 undistributed earnings attributable to non-subpart F income of 100u (net of foreign taxes) and paid 100u in foreign income taxes with respect to those earnings. The average exchange rate for 2008 was $1:1u. CFC1 had no income and no earnings and profits other than those resulting from distributions from CFC2, as provided in either Situation 1 or Situation 2. CFC1 paid no foreign taxes.

(ii)*Situation 1.* In 2009, CFC2 received a refund of foreign taxes of 25u with respect to its 2008 taxable year. As of the close of 2009, CFC2 had 125u of post-1986 undistributed earnings (100u + 25u) and $75 of post-1986 foreign income taxes ($100−$25). In 2010, CFC2 made a distribution to CFC1 of 50u. CFC1 was deemed to have paid $30 of foreign taxes with respect to that distribution (50u/125u × $75). (An income adjustment reflecting foreign currency gain or loss under section 988 with respect to the refund of foreign taxes received by CFC1 is not required because the foreign taxes are denominated and paid in CFC1's functional currency.) At the end of 2010, CFC2 had 75u of post-1986 undistributed earnings (125u−50u) and $45 of post-1986 foreign income taxes ($75−$30).

(iii)*Situation 2.* The facts are the same as in *Example 3(ii), Situation 1,* except that CFC2 made a distribution of 50u in 2009 and received a refund of 75u of foreign tax in 2010. In 2009, the amount of foreign taxes deemed paid by CFC1 is $50 (50u/100u × $100). In accordance with paragraph (d)(2)(ii)(C) of this section, the pools of post-1986 foreign income taxes of CFC1, as well as CFC2, must be adjusted in 2010, because the 2010 refund would otherwise have the effect of reducing below zero CFC2's pool of post-1986 foreign income taxes. Under paragraph (d)(3)(iv) of this section, the pools would have to be adjusted in 2009, and a redetermination of P's United States tax liability would be required, if P had received or accrued a distribution or inclusion from CFC1 or CFC2 in 2009 and computed an amount of foreign taxes deemed paid. CFC1's pool of post-1986 foreign income taxes must be reduced in 2010 by $42.86, determined as follows: $50 (foreign taxes deemed paid on the distribution from CFC2) minus $7.14 (the foreign taxes that would have been deemed paid had the refund occurred prior to the distribution (50u/175u × $25)). CFC2's pool of foreign taxes must be reduced in 2010 by $32.14, determined as follows: $75 (75u refund translated into dollars using the exchange rate that was used to translate such amount when originally added to post-1986 foreign income taxes, that is, $1:1u, the average exchange rate for 2008) minus $42.86 (the adjustment to CFC1's pool of post-1986 foreign income taxes). (An income adjustment reflecting foreign currency gain or loss under section 988 with respect to the refund of foreign taxes received by CFC1 is not required because the foreign taxes are denominated and paid in CFC1's functional currency.) The following reflects the pools of post-1986 undistributed earnings and post-1986 foreign income taxes of CFC1 and CFC2. Post-1986 earnings

(u)Foreign taxes ($) CFC2: 2008 100 100 2009 100−50 = 50 100−50 = 50 2010 50 + 75 = 125 50−32.14 = 17.86 CFC1: 2009 50 50 2010 50 50−42.86 = 7.14 (d)(3) * * *

(ii)*Deemed paid foreign tax adjustment of ten percent or more.* A redetermination of United States tax liability is required if a foreign tax redetermination occurs with respect to foreign taxes paid by a foreign corporation and such foreign tax redetermination, if taken into account in the taxable year of the foreign corporation to which the foreign tax redetermination relates, has the effect of reducing by ten percent or more the domestic corporate shareholder's foreign taxes deemed paid under section 902 or 960 with respect to a distribution or inclusion from the foreign corporation in any taxable year of the domestic corporate shareholder. If a redetermination of United States tax is required under the preceding sentence for any taxable year, a redetermination of United States tax is also required for all subsequent taxable years in which the domestic corporate shareholder received or accrued a distribution or inclusion from the foreign corporation.

(iii)*Example.* The following example illustrates the application of paragraph (d)(3)(ii) of this section: Example.

(i)*Facts.* Controlled foreign corporation

(CFC)is a wholly-owned subsidiary of its domestic parent, P. Both CFC and P use the calendar year as their taxable year. CFC has a functional currency, the u, other than the dollar, and its pool of post-1986 undistributed earnings is maintained in that currency. CFC and P use the average exchange rate to translate foreign income taxes. As of January 1, 2008, CFC had 500u of general category post-1986 undistributed earnings and $200 of general category post-1986 foreign income taxes. In 2008, when the average exchange rate for the year was $1:1u, CFC earned general category income of 600u, accrued 100u of foreign income tax with respect to that income, and made a distribution to P of 100u, 10% of CFC's post-1986 undistributed earnings of 1,000u. P was deemed to have paid $30 of foreign income taxes in 2008 with respect to that distribution (100u/1,000u × $300). In 2009, CFC paid its actual foreign tax liability for 2007 of 80u. Also in 2009, for which the average exchange rate was $1:1.5u, CFC earned 500u of general category income, accrued 150u of tax with respect to that income, and distributed 100u to P. In 2010, CFC incurred a general category loss of

(500u)and accrued no foreign tax. The loss was carried back to 2008 for foreign tax purposes, and CFC received a refund in 2011 of all 80u of foreign taxes paid for its 2008 taxable year.

(ii)*Result in 2009.* If the 20u overaccrual of tax for 2007 were taken into account in 2008, CFC's general category post-1986 undistributed earnings would be 1,020u, CFC's general category post-1986 foreign income taxes would be $280, and P would be deemed to pay $27.45 of tax with respect to the 2008 distribution of 100u (100u/1020u × $280 = $27.45). Because $2.55 is less than 10% of the $30 of foreign taxes deemed paid as originally calculated in 2008, P is not required to redetermine its deemed paid credit and U.S. tax liability for 2008 in 2009. Instead, CFC's general category post-1986 foreign income taxes are reduced by $20 in 2009 (because the overaccrual for 2008 is translated into dollars using the exchange rate that was used to translate such amount when originally added to post-1986 foreign income taxes, that is, $1:1u, the average exchange rate for 2008), and the corresponding pool of general category post-1986 undistributed earnings is increased by 20u in 2009 (because the post-1986 undistributed earnings pool is increased by the functional currency amount of the overaccrual). CFC's general category post-1986 undistributed earnings are also increased in 2009 to 1270u by the 350u earned in 2009 (900u + 20u + 350u = 1270u), and CFC's general category post-1986 foreign income taxes are increased by $100 to $350 ($270 − $20 + $100). P is deemed to pay $27.56 of foreign income taxes in 2009 with respect to the 100u distribution from CFC in that year (100u/1270u × $350).

(iii)*Result in 2011.* If the 80u refund of tax for 2008 were taken into account in 2008, CFC's general category post-1986 undistributed earnings would be 1,100u, CFC's general category post-1986 foreign income taxes would be $200, and P would be deemed to pay $18.18 of tax with respect to the 2008 distribution of 100u (100u/1,100u × $200 = $18.18). Because $11.82 is more than 10% of the $30 of foreign taxes deemed paid as originally calculated in 2008, under paragraph (d)(3)(ii) of this section, P is required to redetermine its deemed paid credit and U.S. tax liability for 2008 and 2009 in 2011. As redetermined in 2011, CFC's post-1986 undistributed earnings for 2009 are 1350u (1,100u as revised for 2008, less 100u distributed in 2008, plus 350u earned in 2009), and its post-1986 foreign income taxes for 2009 are $381.82 ($200 as revised for 2008, less $18.18 deemed paid in 2008, plus $100 accrued for 2009). As redetermined in 2011, P's deemed paid credit with respect to the 100u distribution from CFC in 2009 is $24.28 (100u/1350u × $381.82).

(v)*Example.* The following example illustrates the application of paragraph (d)(3)(iv) of this section: Example. Controlled foreign corporation

(CFC)is a wholly-owned subsidiary of its domestic parent, P. Both CFC and P are calendar year taxpayers. CFC has a functional currency, the u, other than the dollar, and its pool of post-1986 undistributed earnings is maintained in that currency. CFC and P use the average exchange rate to translate foreign taxes. The average exchange rate for both 2008 and 2009 was $1:1u. In 2008, CFC earned 200u of general category income, accrued and paid 100u of foreign taxes with respect to that income, and made a distribution to P of 50u, half of CFC's post-1986 undistributed earnings of 100u. P is deemed to have paid $50 of foreign taxes with respect to that distribution (50u/100u × $100). In 2009, CFC received a refund of all 100u of foreign taxes related to the general category income for 2008. In 2009, CFC earned an additional 290u of income, 200u of which was passive category income and 90u of which was general category income, and accrued and paid 95u of foreign tax, 40u of which was with respect to the passive category income and 45u of which was with respect to the general category income. In accordance with paragraph (d)(3)(iv) of this section, P is required to redetermine its United States tax liability for 2008 to account for the foreign tax redetermination occurring in 2009 because, if an adjustment to CFC's pool of post-1986 foreign income taxes in the general category were made, the pool would be ($5). A deficit is not permitted to be carried in CFC's pool of post-1986 foreign income taxes in any separate category.

(f)*Expiration date.* The applicability of this section expires on or before November 5, 2010. **Par. 3.** Section 1.905-4T is revised to read as follows: § 1.905-4T Notification of foreign tax redetermination (temporary).

(a)*Application of this section.* The rules of this section apply if, as a result of a foreign tax redetermination (as defined in § 1.905-3T(c)), a redetermination of United States tax liability is required under section 905(c) and § 1.905-3T(d).

(b)*Time and manner of notification* —(1) *Redetermination of United States tax liability* —(i) *In general.* Except as provided in paragraphs (b)(1)(iv), (v), and (b)(3) of this section, any taxpayer for which a redetermination of United States tax liability is required must notify the Internal Revenue Service

(IRS)of the foreign tax redetermination by filing an amended return, Form 1118 (Foreign Tax Credit—Corporations) or Form 1116 (Foreign Tax Credit), and the statement required under paragraph

(c)of this section for the taxable year with respect to which a redetermination of United States tax liability is required. Such notification must be filed within the time prescribed by this paragraph

(b)and contain the information described in paragraph

(c)of this section. Where a foreign tax redetermination requires an individual to redetermine the individual's United States tax liability, and as a result of such foreign tax redetermination the amount of creditable taxes paid or accrued by such individual during the taxable year does not exceed the applicable dollar limitation in section 904(k), the individual shall not be required to file Form 1116 with the amended return for such taxable year if the individual satisfies the requirements of section 904(k).

(ii)*Reduction in amount of foreign tax liability.* Except as provided in paragraphs (b)(1)(iv), (v), and (b)(3) of this section, for each taxable year of the taxpayer with respect to which a redetermination of United States tax liability is required by reason of a foreign tax redetermination that reduces the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, the taxpayer must file a separate notification for each such taxable year by the due date (with extensions) of the original return for the taxpayer's taxable year in which the foreign tax redetermination occurred.

(iii)*Increase in amount of foreign tax liability.* Except as provided in paragraphs (b)(1)(iv), (v), and (b)(3) of this section, for each taxable year of the taxpayer with respect to which a redetermination of United States tax liability is required by reason of a foreign tax redetermination that increases the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, the taxpayer must notify the Internal Revenue Service within the period provided by section 6511(d)(3)(A). Filing of such notification within the prescribed period shall constitute a claim for refund of United States tax.

(iv)*Multiple redeterminations of United States tax liability for same taxable year.* Where more than one foreign tax redetermination requires a redetermination of United States tax liability for the same taxable year of the taxpayer and those redeterminations occur within two consecutive taxable years of the taxpayer, the taxpayer may file for such taxable year one amended return, Form 1118 or 1116, and the statement required under paragraph

(c)of this section that reflect all such foreign tax redeterminations. If the taxpayer chooses to file one notification for such redeterminations, the taxpayer must file such notification by the due date (with extensions) of the original return for the taxpayer's taxable year in which the first foreign tax redetermination that reduces foreign tax liability occurred. Where a foreign tax redetermination with respect to the taxable year for which a redetermination of United States tax liability is required occurs after the date for providing such notification, more than one amended return may be required with respect to that taxable year.

(v)*Carryback and carryover of unused foreign tax.* Where a foreign tax redetermination requires a redetermination of United States tax liability that would otherwise result in an additional amount of United States tax due, but such amount is eliminated as a result of a carryback or carryover of an unused foreign tax under section 904(c), the taxpayer may, in lieu of applying the rules of paragraphs (b)(1)(i) and

(ii)of this section, notify the IRS of such redetermination by attaching a statement to the original return for the taxpayer's taxable year in which the foreign tax redetermination occurs. Such statement must be filed by the due date (with extensions) of the original return for the taxpayer's taxable year in which the foreign tax redetermination occurred and contain the information described in § 1.904-2(f).

(vi)*Example.* The following example illustrates the application of this paragraph (b)(1): Example.

(i)X, a domestic corporation, is an accrual basis taxpayer and uses the calendar year as its United States taxable year. X conducts business through a branch in Country M, the currency of which is the m, and also conducts business through a branch in Country N, the currency of which is the n. X uses the average exchange rate to translate foreign income taxes. Assume that X is able to claim a credit under section 901 for all foreign taxes paid or accrued.

(ii)In 2008, X accrued and paid 100m of Country M taxes with respect to 400m of foreign source general category income. The average exchange rate for 2008 was $1:1m. Also in 2008, X accrued and paid 50n of Country N taxes with respect to 150n of foreign source general category income. The average exchange rate for 2008 was $1:1n. X claimed a foreign tax credit of $150 ($100 (100m at $1:1m) + $50 (50n at $1:1n)) with respect to its foreign source general category income on its United States tax return for 2008.

(iii)In 2009, X accrued and paid 100n of Country N taxes with respect to 300n of foreign source general category income. The average exchange rate for 2009 was $1.50:1n. X claimed a foreign tax credit of $150 (100n at $1.5:1n) with respect to its foreign source general category income on its United States tax return for 2009.

(iv)On June 15, 2012, when the spot exchange rate was $1.40:1n, X received a refund of 10n from Country N, and, on March 15, 2013, when the spot exchange rate was $1.20:1m, X was assessed by and paid Country M an additional 20m of tax. Both payments were with respect to X's foreign source general category income in 2008. On May 15, 2013, when the spot exchange rate was $1.45:1n, X received a refund of 5n from Country N with respect to its foreign source general category income in 2009.

(v)X must redetermine its United States tax liability for both 2008 and 2009. With respect to 2008, X must notify the IRS of the June 15, 2012, refund of 10n from Country N that reduced X's foreign tax liability by filing an amended return, Form 1118, and the statement required in paragraph

(c)of this section for 2008 by the due date of the original return (with extensions) for 2012. The amended return and Form 1118 must reduce the amount of foreign taxes claimed as a credit under section 901 by $10 (10n refund translated at the average exchange rate for 2008, or $1:1n (see § 1.905-3T(b)(3)). X will recognize foreign currency gain or loss under section 988 in or after 2012 on the conversion of the 10n refund into dollars. With respect to the March 15, 2013, additional assessment of 20m by Country M, X must notify the IRS within the time period provided by section 6511(d)(3)(A), increasing the foreign taxes available as a credit by $24 (20m translated at the exchange rate on the date of payment, or $1.20:1m ). See sections 986(a)(1)(B)(i) and 986(a)(2)(A) and § 1.905-3T(b)(1)(ii)(A). X may so notify the IRS by filing a second amended return, Form 1118, and the statement required in paragraph

(c)of this section for 2008, within the time period provided by section 6511(d)(3)(A). Alternatively, when X redetermines its United States tax liability for 2008 to take into account the 10n refund from Country N which occurred in 2012, X may also take into account the 20m additional assessment by Country M which occurred on March 15, 2013. See § 1.905-4T(b)(1)(iv). Where X reflects both foreign tax redeterminations on the same amended return, Form 1118, and in the statement required in paragraph

(c)of this section for 2008, the amount of X's foreign taxes available as a credit would be:

(A)Reduced by $10 (10n refund translated at $1:1n) and

(B)Increased by $24 (20m additional assessment translated at the exchange rate on the date of payment, March 15, 2013, or $1.20:1m). The foreign taxes available as a credit therefore would be increased by $14 ($24 (additional assessment) − $10 (refund)). The due date of the 2008 amended return, Form 1118, and the statement required in paragraph

(c)of this section reflecting foreign tax redeterminations in both years would be the due date (with extensions) of X's original return for 2012.

(vi)With respect to 2009, X must notify the IRS by filing an amended return, Form 1118, and the statement required in paragraph

(c)of this section for 2009 that is separate from that filed for 2008. The amended return, Form 1118, and the statement required in paragraph

(c)of this section for 2009 must be filed by the due date (with extensions) of X's original return for 2013. The amended return and Form 1118 must reduce the amount of foreign taxes claimed as a credit under section 901 by $7.50 (5n refund translated at the average exchange rate for 2009, or $1.50:1n). X will recognize foreign currency gain or loss under section 988 in or after 2013 on the conversion of the 5n refund into dollars.

(2)*Pooling adjustment in lieu of redetermination of United States tax liability.* Where a redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960, and the taxpayer is required to adjust the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes under § 1.905-3T(d)(2), the taxpayer is required to notify the IRS of such redetermination by reflecting the adjustments to the foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes on a Form 1118 for the taxpayer's first taxable year with respect to which the redetermination affects the computation of foreign taxes deemed paid. Such Form 1118 must be filed by the due date (with extensions) of the original return for such taxable year. In the case of multiple redeterminations that affect the computation of foreign taxes deemed paid for the same taxable year and that are required to be reported under this paragraph (b)(2), a taxpayer may file one notification for all such redeterminations in lieu of filing a separate notification for each such redetermination. See section 905(b) and the regulations under that section which require that a taxpayer substantiate that a foreign tax was paid and provide all necessary information establishing its entitlement to the foreign tax credit.

(3)*Taxpayers under the jurisdiction of the Large and Mid-Size Business Division.* The rules of this paragraph (b)(3) apply where a redetermination of United States tax liability is required by reason of a foreign tax redetermination that results in a reduction in the amount of foreign taxes paid or accrued, or included in the computation of foreign taxes deemed paid, and such foreign tax redetermination occurs while a taxpayer is under the jurisdiction of the Large and Mid-Size Business Division (or similar program). The taxpayer must, in lieu of applying the rules of paragraphs (b)(1)(i) and

(ii)of this section (requiring the filing of an amended return, Form 1118, and a statement described in paragraph

(c)of this section by the due date (with extensions) of the original return for the taxpayer's taxable year in which the foreign tax redetermination occurred), notify the IRS of such redetermination by providing to the examiner the statement described in paragraph

(ii)of this section, provide the statement to the examiner within 120 days after the date the foreign tax redetermination occurs, and the IRS, in its discretion, may accept such statement or require the taxpayer to comply with the rules of paragraphs (b)(1)(i) and

(ii)of this section. A taxpayer subject to the rules of this paragraph (b)(3) must satisfy the rules of this paragraph (b)(3) (in lieu of the rules of paragraphs (b)(1)(i) and

(ii)of this section) in order not to be subject to the penalty relating to the failure to file notice of a foreign tax redetermination under section 6689 and the regulations under that section. This paragraph (b)(3) shall not apply where the due date specified in paragraph (b)(1)(ii) of this section for providing notice of the foreign tax redetermination precedes the latest of the opening conference or the hand-delivery or postmark date of the opening letter concerning an examination of the return for the taxable year for which a redetermination of United States tax liability is required by reason of such foreign tax redetermination. In addition, any statement that would otherwise be required to be provided under this paragraph (b)(3) on or before May 5, 2008 will be considered timely if provided on or before May 5, 2008.

(4)*Example.* The following example illustrates the application of paragraph (b)(3) of this section: *Example.* X, a taxpayer under the jurisdiction of the Large and Mid-Size Business Division, uses the calendar year as its United States taxable year. On October 15, 2009, X receives a refund of foreign tax that constitutes a foreign tax redetermination that necessitates a redetermination of United States tax liability for X's 2008 taxable year. Under paragraph (b)(1)(ii) of this section, X is required to notify the IRS of the foreign tax redetermination by filing an amended return, Form 1118, and the statement required in paragraph

(c)of this section for its 2008 taxable year by September 15, 2010 (the due date (with extensions) of the original return for X's 2009 taxable year). On December 15, 2010, the IRS hand delivers an opening letter concerning the examination of the return for X's 2008 taxable year, and the opening conference for such examination is scheduled for January 15, 2011. Because the date for notifying the IRS of the foreign tax redetermination under paragraph (b)(1)(ii) of this section precedes the date of the opening conference concerning the examination of the return for X's 2008 taxable year, paragraph (b)(3) of this section does not apply, and X must notify the IRS of the foreign tax redetermination by filing an amended return, Form 1118, and the statement required in paragraph

(c)of this section for the 2007 taxable year by September 15, 2010.

(c)*Notification contents* —(1) *In general.* In addition to satisfying the requirements of paragraph

(b)of this section, the taxpayer must furnish a statement that contains information sufficient for the IRS to redetermine the taxpayer's United States tax liability where such a redetermination is required under section 905(c), and to verify adjustments to the pools of post-1986 undistributed earnings and post-1986 foreign income taxes where such adjustments are required under § 1.905-3T(d)(2). The information must be in a form that enables the IRS to verify and compare the original computations with respect to a claimed foreign tax credit, the revised computations resulting from the foreign tax redetermination, and the net changes resulting therefrom. The statement must include the taxpayer's name, address, identifying number, and the taxable year or years of the taxpayer that are affected by the foreign tax redetermination. In addition, the taxpayer must provide the information described in paragraph (c)(2) or (c)(3) of this section, as appropriate. If the statement is submitted to the IRS under paragraph (b)(3) of this section, which provides requirements with respect to reporting by taxpayers under the jurisdiction of the Large and Mid-Size Business Division, the statement must also include the following declaration signed by a person authorized to sign the return of the taxpayer: “Under penalties of perjury, I declare that I have examined this written statement, and to the best of my knowledge and belief, this written statement is true, correct, and complete.”

(2)*Foreign taxes paid or accrued.* Where a redetermination of United States tax liability is required by reason of a foreign tax redetermination as defined in § 1.905-3T(c), in addition to the information described in paragraph (c)(1) of this section, the taxpayer must provide the following: the date or dates the foreign taxes were accrued, if applicable; the date or dates the foreign taxes were paid; the amount of foreign taxes paid or accrued on each date (in foreign currency) and the exchange rate used to translate each such amount, as provided in § 1.905-3T(b)(1) or (b)(2); and information sufficient to determine any interest due from or owing to the taxpayer, including the amount of any interest paid by the foreign government to the taxpayer and the dates received. In addition, in the case of any foreign tax that is refunded in whole or in part, the taxpayer must provide the date of each such refund; the amount of such refund (in foreign currency); and the exchange rate that was used to translate such amount when originally claimed as a credit (as provided in § 1.905-3T(b)(3)) and the exchange rate for the date the refund was received (for purposes of computing foreign currency gain or loss under section 988). In addition, in the case of any foreign taxes that were not paid before the date two years after the close of the taxable year to which such taxes relate, the taxpayer must provide the amount of such taxes in foreign currency, and the exchange rate that was used to translate such amount when originally added to post-1986 foreign income taxes or claimed as a credit. Where a redetermination of United States tax liability results in an amount of additional tax due, but the carryback or carryover of an unused foreign tax under section 904(c) only partially eliminates such amount, the taxpayer must also provide the information required in § 1.904-2(f).

(3)*Foreign taxes deemed paid.* Where a redetermination of United States tax liability is required under § 1.905-3T(d)(3) to account for the effect of a redetermination of foreign tax paid or accrued by a foreign corporation on foreign taxes deemed paid under section 902 or 960, in addition to the information described in paragraphs (c)(1) and (c)(2) of this section, the taxpayer must provide the balances of the pools of post-1986 undistributed earnings and post-1986 foreign income taxes before and after adjusting the pools in accordance with the rules of § 1.905-3T(d)(2), the dates and amounts of any dividend distributions or other inclusions made out of earnings and profits for the affected year or years, and the amount of earnings and profits from which such dividends were paid for the affected year or years.

(d)*Payment or refund of United States tax.* The amount of tax, if any, due upon a redetermination of United States tax liability shall be paid by the taxpayer after notice and demand has been made by the IRS. Subchapter B of chapter 63 of the Internal Revenue Code (relating to deficiency procedures) shall not apply with respect to the assessment of the amount due upon such redetermination. In accordance with sections 905(c) and 6501(c)(5), the amount of additional tax due shall be assessed and collected without regard to the provisions of section 6501(a) (relating to limitations on assessment and collection). The amount of tax, if any, shown by a redetermination of United States tax liability to have been overpaid shall be credited or refunded to the taxpayer in accordance with the provisions of section 6511(d)(3)(A) and § 301.6511(d)-3 of this chapter.

(e)*Interest and penalties* —(1) *In general.* If a redetermination of United States tax liability is required by reason of a foreign tax redetermination, interest shall be computed on the underpayment or overpayment in accordance with sections 6601 and 6611 and the regulations under these sections. No interest shall be assessed or collected on any underpayment resulting from a refund of foreign tax for any period before the receipt of the refund, except to the extent interest was paid by the foreign country or possession of the United States on the refund for the period. In no case, however, shall interest assessed and collected pursuant to the preceding sentence for any period before receipt of the foreign tax refund exceed the amount that otherwise would have been assessed and collected under section 6601 and the regulations under this section for that period. Interest shall be assessed from the time the taxpayer (or the foreign corporation of which the taxpayer is a shareholder) receives a refund until the taxpayer pays the additional tax due the United States.

(2)*Adjustments to pools of foreign taxes.* No underpayment or overpayment of United States tax liability results from a redetermination of foreign tax unless a redetermination of United States tax liability is required. Consequently, no interest shall be paid by or to a taxpayer as a result of adjustments to a foreign corporation's pools of post-1986 undistributed earnings and post-1986 foreign income taxes made in accordance with § 1.905-3T(d)(2).

(3)*Imposition of penalty.* Failure to comply with the provisions of this section shall subject the taxpayer to the penalty provisions of section 6689 and the regulations under that section.

(f)*Effective/applicability date* —(1) *In general.* This section applies to foreign tax redeterminations (defined in § 1.905-3T(c)) occurring in taxable years of United States taxpayers beginning on or after November 7, 2007, where the foreign tax redetermination affects the amount of foreign taxes paid or accrued by a United States taxpayer. Where the redetermination of foreign tax paid or accrued by a foreign corporation affects the computation of foreign taxes deemed paid under section 902 or 960 with respect to pre-1987 accumulated profits or post-1986 undistributed earnings of the foreign corporation, this section applies to foreign tax redeterminations occurring in a taxable year of the foreign corporation which ends with or within a taxable year of its domestic corporate shareholder beginning on or after November 7, 2007. In no case, however, shall this paragraph (f)(1) operate to extend the statute of limitations provided by section 6511(d)(3)(A).

(2)*Foreign tax redeterminations occurring in taxable years beginning before November 7, 2007* —(i) *Scope.* This paragraph (f)(2) applies to any foreign tax redetermination (as defined in § 1.905-3T(c)) which occurred in any of the three taxable years of a United States taxpayer immediately preceding the taxpayer's first taxable year beginning on or after November 7, 2007; reduced the amount of foreign taxes paid or accrued by the taxpayer; and requires a redetermination of United States tax liability for any taxable year. This paragraph (f)(2) also applies to any redetermination of foreign tax paid or accrued by a foreign corporation which occurred in a taxable year of the foreign corporation which ends with or within any of the three taxable years of a domestic corporate shareholder immediately preceding such shareholder's first taxable year beginning on or after November 7, 2007; reduced foreign taxes included in the computation of foreign taxes deemed paid by such shareholder under section 902 or 960; and requires a redetermination of United States tax liability under § 1.905-3T(d)(3) for any taxable year. For corresponding rules applicable to foreign tax redeterminations occurring in taxable years beginning before the third taxable year immediately preceding the taxable year beginning on or after November 7, 2007, see 26 CFR 1.905-4T and 1.905-5T (as contained in 26 CFR part 1, revised as of April 1, 2007).

(ii)*Notification required.* If, as of November 7, 2007, the taxpayer has not satisfied the notification requirements described in § 1.905-3T and this section (as contained in 26 CFR part 1, revised as of April 1, 2007, as modified by Notice 90-26, 1990-1 CB 336, see § 601.601(d)(2)(ii)( *b* ) of this chapter), with respect to a foreign tax redetermination described in paragraph (f)(2)(i) of this section, the taxpayer must notify the IRS of the foreign tax redetermination by filing an amended return, Form 1118 or 1116, and the statement required in paragraph

(c)of this section for the taxable year with respect to which a redetermination of United States tax liability is required. Such notification must be filed no later than the due date (with extensions) of the original return for the taxpayer's first taxable year following the taxable year in which these regulations are first effective. Where the foreign tax redetermination requires an individual to redetermine the individual's United States tax liability, and as a result of such foreign tax redetermination the amount of creditable taxes paid or accrued by such individual during the taxable year does not exceed the applicable dollar limitation in section 904(k), the individual shall not be required to file Form 1116 with the amended return for such taxable year if the individual satisfies the requirements of section 904(k). The rules of paragraphs (b)(1)(iv) and

(v)of this section (concerning multiple redeterminations of United States tax liability for the same taxable year, and the carryback and carryover of unused foreign tax) shall apply.

(iii)*Taxpayers under the jurisdiction of the Large and Mid-Size Business Division.* If a taxpayer under the jurisdiction of the Large and Mid-Size Business Division is otherwise required under paragraph (f)(2)(ii) of this section to notify the IRS of a foreign tax redetermination described in paragraph (f)(2)(ii) of this section by filing an amended return, Form 1118, and the statement required in paragraph

(c)of this section, such taxpayer may, in lieu of applying the rules of paragraph (f)(2)(ii) of this section, provide to the examiner the information described in paragraph

(c)of this section during an examination of the return for the taxable year for which a redetermination of United States tax liability is required by reason of such foreign tax redetermination. The taxpayer must provide the information to the examiner on or before the date that is the later of May 5, 2008 or 120 days after the latest of the opening conference or the hand-delivery or postmark date of the opening letter concerning an examination of the return for the taxable year for which a redetermination of United States tax liability is required. However, if November 7, 2007 is more than 180 days after the latest of the opening conference or the hand-delivery or postmark date of the opening letter, the IRS, in its discretion, may accept such statement or require the taxpayer to comply with the rules of paragraph (f)(2)(ii) of this section. This paragraph (f)(2)(iii) shall not apply where the due date specified in paragraph (f)(2)(ii) of this section for providing notice of the foreign tax redetermination precedes the latest of the opening conference or the hand-delivery or postmark date of the opening letter concerning an examination of the return for the taxable year for which a redetermination of United States tax liability is required.

(iv)*Interest and penalties.* Interest shall be computed in accordance with paragraph

(e)of this section. Failure to comply with the provisions of this paragraph (f)(2) shall subject the taxpayer to the penalty provisions of section 6689 and the regulations under that section.

(3)*Expiration date.* The applicability of this section expires on or before November 5, 2010. **Par. 4.** Section 1.905-5T is amended as follows: 1. Remove the language “earnings and profits accumulated in taxable years of a foreign corporation beginning prior to January 1, 1987” from the second sentence of paragraph

(a)and add the language “pre-1987 accumulated profits (as defined in § 1.902-1(a)(10)(i)” in its place. 2. Remove the language “§ 1.905-4(b)(3)” from the second sentence of paragraph (d)(1) and add the language “§ 1.905-4T(c)” in its place. 3. Remove the language “§ 1.905-4T(b)(3)(ii)(A)” from paragraph (d)(2) and add the language “§ 1.905-4T(c)(2)” in its place. 4. Remove the language “paragraph (b)(3)(iii)” from paragraph (d)(3) and add the language “§ 1.905-4T(c)(3)” in its place. 5. Remove the language “§ 1.905-4T(b)(3)(iii) in lieu of the exchange rate for the date of the accrual” from paragraph (d)(4) and add the language “§ 1.905-4T(c)(3)” in its place. 6. Revise the heading and first sentence of paragraph (f). 7. Add a new paragraph (g). The revision and addition read as follows: § 1.905-5T Foreign tax redeterminations and currency translation rules for foreign tax redeterminations occurring in taxable years beginning prior to January 1, 1987 (temporary).

(f)*Special effective/applicability date.* See § 1.905-4T(f) for the applicability date of notification requirements relating to foreign tax redeterminations that affect foreign taxes deemed paid under section 902 or section 960 with respect to pre-1987 accumulated profits accumulated in taxable years of a foreign corporation beginning on or after January 1, 1987. * * *

(g)*Expiration date.* The applicability of this section expires on or before November 5, 2010. PART 301—PROCEDURE AND ADMINISTRATION **Par. 5.** The authority citation for part 301 continues to read as follows: Authority: 26 U.S.C. 7805 * * * **Par. 6.** Section 301.6689-1T is amended as follows: 1. Add a new sentence at the end of paragraph (a). 2. Revise paragraph (e). The addition and revision read as follows: § 301.6689-1T Failure to file notice of redetermination of foreign tax (temporary).

(a)* * * Subchapter B of chapter 63 of the Internal Revenue Code (relating to deficiency proceedings) shall not apply with respect to the assessment of the amount of the penalty.

(e)*Effective/applicability date* —(1) *In general.* This section applies to foreign tax redeterminations (as defined in § 1.905-3T(c) of this chapter) occurring in taxable years of United States taxpayers beginning on or after November 7, 2007, and in the three immediately preceding taxable years. For corresponding rules applicable to foreign tax redeterminations occurring in earlier taxable years of United States taxpayers, see 26 CFR 301.6689-1T (as contained in 26 CFR part 301, revised as of April 1, 2007).

(2)*Expiration date.* The applicability of this section expires on or before November 5, 2010. Kevin M. Brown, Deputy Commissioner for Services and Enforcement. Approved: August 9, 2007. Karen A. Sowell, Deputy Assistant Secretary of the Treasury (Tax Policy). [FR Doc. E7-21766 Filed 11-6-07; 8:45 am] BILLING CODE 4830-01-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 52 and 97 [EPA-R03-OAR-2007-0448; FRL-8493-2] Approval and Promulgation of Air Quality Implementation Plans; West Virginia; Withdrawal of Direct Final Rule AGENCY: Environmental Protection Agency (EPA). ACTION: Withdrawal of Direct final rule. SUMMARY: Due to an adverse comment, EPA is withdrawing the direct final rule to approve a SIP revision submitted by West Virginia pertaining to its abbreviated SIP for the Clean Air Interstate Rule

(CAIR)Nitrogen Oxides (NO X ) Annual and NO X Ozone Season trading programs. In the direct final rule published on September 13, 2007 (72 FR 52289), we stated that if we received adverse comment by October 15, 2007, the rule would be withdrawn and not take effect. EPA subsequently received an adverse comment. EPA will address the comment received in a subsequent final action based upon the proposed action also published on September 13, 2007 (72 FR 52325). EPA will not institute a second comment period on this action. DATES: *Effective Date:* The Direct final rule is withdrawn as of November 7, 2007. FOR FURTHER INFORMATION CONTACT: Marilyn Powers,

(215)814-2308, or by e-mail at *powers.marilyn@epa.gov.* List of Subjects 40 CFR Part 52 Environmental protection, Air pollution control, Nitrogen dioxide, Ozone, Particulate Matter, Reporting and recordkeeping requirements, Sulfur oxides. 40 CFR Part 97 Environmental protection, Administrative practice and procedure, Air pollution control, Intergovernmental relations, Nitrogen oxides, Ozone, Reporting and recordkeeping requirements. Dated: October 29, 2007. Donald S. Welsh, Regional Administrator, Region III. Accordingly, the addition of entries for 45 CSR 39 and 40 to the table in paragraph

(c)and the addition of an entry for Article 3, Chapter 64 of the Code of West Virginia to the table in paragraph

(e)of § 52.2520 are withdrawn as of November 7, 2007. [FR Doc. E7-21863 Filed 11-6-07; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2006-0524; FRL-8153-7] Oxytetracycline; Pesticide Tolerance AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule. SUMMARY: This regulation establishes a tolerance for residues of oxytetracycline in or on apples. Interregional Research Project #4 (IR-4) requested this tolerance under the Federal Food, Drug, and Cosmetic Act (FFDCA). DATES: This regulation is effective November 7, 2007. Objections and requests for hearings must be received on or before January 7, 2008, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION ). ADDRESSES: EPA has established a docket for this action under docket identification

(ID)number EPA-HQ-OPP-2006-0524. To access the electronic docket, go to *http://www.regulations.gov* , select “Advanced Search,” then “Docket Search.” Insert the docket ID number where indicated and select the “Submit” button. Follow the instructions on the regulations.gov website to view the docket index or access available documents. All documents in the docket are listed in the docket index available in regulations.gov. Although listed in the index, some information is not publicly available, e.g., Confidential Business Information

(CBI)or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available in the electronic docket at *http://www.regulations.gov* , or, if only available in hard copy, at the OPP Regulatory Public Docket in Rm. S-4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. The Docket Facility is open from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The Docket Facility telephone number is

(703)305-5805. FOR FURTHER INFORMATION CONTACT: Barbara Madden, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number:

(703)305-6463; e-mail address: *madden.barbara@epa.gov* . SUPPLEMENTARY INFORMATION: I. General Information A. Does this Action Apply to Me? You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to those engaged in the following activities: • Crop production (NAICS code 111), e.g., agricultural workers; greenhouse, nursery, and floriculture workers; farmers. • Animal production (NAICS code 112), e.g., cattle ranchers and farmers, dairy cattle farmers, livestock farmers. • Food manufacturing (NAICS code 311), e.g., agricultural workers; farmers; greenhouse, nursery, and floriculture workers; ranchers; pesticide applicators. • Pesticide manufacturing (NAICS code 32532), e.g., agricultural workers; commercial applicators; farmers; greenhouse, nursery, and floriculture workers; residential users. This listing is not intended to be exhaustive, but rather to provide a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT . B. How Can I Access Electronic Copies of this Document? In addition to accessing an electronic copy of this **Federal Register** document through the electronic docket at *http://www.regulations.gov* , you may access this **Federal Register** document electronically through the EPA Internet under the “ **Federal Register** ” listings at *http://www.epa.gov/fedrgstr* . You may also access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's pilot e-CFR site at *http://www.gpoaccess.gov/ecfr* . C. Can I File an Objection or Hearing Request? Under section 408(g) of FFDCA, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2006-0524 in the subject line on the first page of your submission. All requests must be in writing, and must be mailed or delivered to the Hearing Clerk as required by 40 CFR part 178 on or before January 7, 2008. In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing that does not contain any CBI for inclusion in the public docket that is described in ADDRESSES . Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit this copy, identified by docket ID number EPA-HQ-OPP-2006-0524, by one of the following methods: • *Federal eRulemaking Portal* : *http://www.regulations.gov* . Follow the on-line instructions for submitting comments. • *Mail* : Office of Pesticide Programs

(OPP)Regulatory Public Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001. • *Delivery* : OPP Regulatory Public Docket (7502P), Environmental Protection Agency, Rm. S-4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. Deliveries are only accepted during the Docket's normal hours of operation (8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays). Special arrangements should be made for deliveries of boxed information. The Docket Facility telephone number is

(703)305-5805. II. Petition for Tolerance In the **Federal Register** of October 11, 2006 (71 FR 59783) (FRL-8097-6), EPA issued a notice pursuant to section 408(d)(3) of FFDCA, 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 7E4855) by Interregional Research Project #4 (IR-4), 500 College Rd., East, Suite 201 W, Princeton, NJ 08540. The petition requested that 40 CFR 180.337 be amended by establishing a tolerance for residues of the fungicide oxytetracycline, in or on apple at 0.35 parts per million (ppm). That notice referenced a summary of the petition prepared by Nufarm Americas Inc., the registrant, which is available to the public in the docket, *http://www.regulations.gov* . Comments were received on the notice of filing. EPA's response to these comments is discussed in Unit IV.C. Oxytetracycline has two major agricultural uses. It is used to treat plant and animal disease and at subtherapeutic doses in animals to promote growth. Clinically, oxytetracycline is a second-line of defense against a host of infections. The pesticidal use of oxytetracycline on plants is small compared to the animal and human usage; it has been estimated as <0.5% of all antibiotic uses. III. Aggregate Risk Assessment and Determination of Safety Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .” These provisions were added to FFDCA by the Food Quality Protection Act

(FQPA)of 1996. Consistent with section 408(b)(2)(D) of FFDCA, and the factors specified in section 408(b)(2)(D) of FFDCA, EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for the petitioned-for tolerance for residues of oxytetracycline on apple at 0.35 ppm. EPA's assessment of exposures and risks associated with establishing the tolerance follows. A. Toxicological Profile EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. Specific information on the studies received and the nature of the adverse effects caused by oxytetracycline as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at *http://www.regulations.gov* . The referenced document is available in the docket established by this action, which is described under ADDRESSES , and is identified as document 0027 (pages 20 thru 24) in Docket ID EPA-HQ-OPP-2005-0492. For oxytetracycline a definitive target organ has not been identified. The most common effect in intermediate- or long-term oral exposures was a decrease in body weight and/or body weight gain. Clinical signs noted were increased incidence of respiratory signs and rough hair coat and decreased maternal survival and percent of treated dams found pregnant. In a chronic toxicity study in dogs, a yellow discoloration of the thyroid was observed in all dosed animals at necropsy. No other changes in clinical signs, mortality, body weight, food consumption, macrosopy, or histopathology were reported in dogs. In prenatal developmental toxicity studies, maternal toxicity was evident in rats as a dose-related increase in mortality. A dose-related decrease in fetal body weight was observed in rats. No maternal or developmental toxicity was observed in mice treated up to 2,100 milligrams/kilograms/day (mg/kg/day). No treatment-related external, visceral, or skeletal abnormalities were found in either species. In a study citation that was reported by a Joint FAO/WHO committee, oxytetracycline did not adversely affect reproductive parameters in rats over two generations. There is no evidence of increased sensitivity in pups versus adults based on rat and mice developmental studies and the rat multi-generation reproduction study. In prenatal developmental studies in both rats and mice treated with oxytetracycline, there was no toxicity identified in the pups at any dose tested. In the 2-generation study, there was no toxicity identified in pups at the highest dose tested. The degree of concern is low for prenatal and/or postnatal toxicity resulting from exposure to oxytetracycline. No evidence of neurotoxicity was observed in any study. The microbiological effects of oxytetracycline were examined by studies examining the induction of drug-resistant organisms in dogs. In a 6-week study in dogs, which received oxytetracycline, there was no increase in the level of resistant fecal coliforms at 2 ppm in the diet (equivalent to 0.05 mg/kg/day). Dogs receiving 10 ppm (equivalent to 0.25 ppm) displayed an increase in a multiple antibiotic-resistant population of enteric lactose-fermenting organisms. The mechanisms of action of antimicrobials, such as oxytetracycline, are based on affecting the pathogenic organism and not the host. The database for oxytetracycline demonstrates that it is indeed of low toxicological concern as most adverse effects seen following oral oxytetracycline treatment in animals are observed at very high dosages (e.g, near or above 1,000 mg/kg/day in animals). In humans, there are demonstrated toxicological concerns associated with the use of oxytetracycline, although the risk of adverse effects are low. B. Toxicological Endpoints For hazards that have a threshold below which there is no appreciable risk, the toxicological level of concern

(LOC)is derived from the highest dose at which no adverse effects are observed (the NOAEL) in the toxicology study identified as appropriate for use in risk assessment. However, if a NOAEL cannot be determined, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment. Uncertainty/safety factors

(UFs)are used in conjunction with the LOC to take into account uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. Safety is assessed for acute and chronic risks by comparing aggregate exposure to the pesticide to the acute population adjusted dose

(aPAD)and chronic population adjusted dose (cPAD). The aPAD and cPAD are calculated by dividing the LOC by all applicable UFs. Short-, intermediate-, and long-term risks are evaluated by comparing aggregate exposure to the LOC to ensure that the margin of exposure

(MOE)called for by the product of all applicable UFs is not exceeded. For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk and estimates risk in terms of the probability of occurrence of additional adverse cases. Generally, cancer risks are considered non-threshold. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see *http://www.epa.gov/pesticides/factsheets/riskassess.htm* . A summary of the toxicological endpoints for oxytetracycline used for human risk assessment can be found at *www.regulations.gov* in document 0027 (pages 27 thru 29) in Docket ID EPA-HQ-OPP-2005-0492. No appropriate acute dietary endpoint attributable to a single exposure was identified for females age 13-49 or for the general population. A chronic dietary endpoint

(cPAD)was identified for all populations based on the microbiological study in dogs with a NOAEL of 0.05 mg/kg/day based on a shift from a predominantly drug-susceptible population of enteric lactose-fermenting organisms to a multiple antibiotic-resistant population at 0.25 mg/kg/day (LOAEL) in mature beagle dogs. This chronic endpoint is considered conservative and protective for the entire toxicological database and was selected based on the qualitative classification of overall risk of resistance being medium. Other studies in the toxicological database demonstrated NOAELs near or above 1,000 mg/kg/day with the exception of a cited 2-generation reproductive study which had a NOAEL of 18 mg/kg/day. Based on the data available, the UF for the dog study is 10X for intraspecies variations and 10X for interspecies extrapolation. The cPAD was selected using an animal resistance endpoint in mature beagle dogs. The risk assessment team acknowledges that this study is not a precise description of antibiotic resistance in animals or humans. It is, however, a good indicator of the selective pressure of antibiotic usage and recognizes the potential for resistance in future infections. C. Exposure Assessment 1. *Dietary exposure from food and feed uses* . In evaluating dietary exposure to oxytetracycline, EPA considered exposure under the petitioned-for tolerances as well as all existing oxytetracycline tolerances in (40 CFR 180.337). EPA assessed dietary exposures from oxytetracycline in food as follows: i. *Acute exposure* . Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure. No such effects were identified in the toxicological studies for oxytetracycline; therefore, a quantitative acute dietary exposure assessment is unnecessary. ii. *Chronic exposure* . In conducting the chronic dietary exposure assessment, EPA used the food consumption data from the USDA 1994-1996 and 1998 Nationwide Continuing Surveys of Food Intake by Individuals (CSFII). As to residue levels in food, EPA relied upon anticipated residues and percent crop treated

(PCT)information for all commodities. Anticipated residue levels for apples, peaches (nectarines), and pears, percent crop treated information, default processing factors, and Food Safety and Inspection Service

(FSIS)monitoring data from 2002, 2003, and 2004 to estimate residue levels in livestock commodities were used. Tolerances are currently established under 40 CFR 180.337 for residues of oxytetracycline *per se* in/on peach and pears at 0.35 ppm. As indicated in 40 CFR 180.1(h), tolerances for peaches also cover nectarines. Therefore, nectarines were included in the analysis using the peach residue data. For apples, an anticipated residue level of 0.033 ppm was used, based on the mean residue level measured in the field trial studies reflecting a total oxytetracycline application rate of 1.53 lb ai/A. For peach, nectarine, and pears, an anticipated residue level of 0.20 ppm was used, based on average residue levels from the available field trial data. Based on the registered uses of oxytetracycline on pears, peaches, and nectarines, and the proposed use on apples, no quantifiable residues in meat, milk, poultry, and eggs

(MMPE)are expected. However, the Food and Drug Administration

(FDA)has established tolerances in MMPE commodities for the sum of the residues of the tetracyclines including chlortetracycline, oxytetracycline, and tetracycline as listed in 21 CFR 556.500. Accordingly, the analysis includes estimates of possible oxytetracycline residues in livestock commodities making use of monitoring data from the FSIS collected in 2002, 2003, and 2004. These data were taken from the FSIS National Residue Program Data publications (Red Books). The relevant FSIS data sampled kidney tissue from a variety of livestock (cattle, swine, poultry, goats, etc), analyzing for oxytetracycline residues. As tetracycline residues partition preferentially into fat and kidney, measured oxytetracycline residues in kidney were used as worst-case level for all other livestock tissues. In 2004 and 2002, no oxytetracycline residues were detected in 4,270 and 6,942 samples, respectively. In 2003, three kidney samples had finite oxytetracycline residue levels out of 5,260 samples. To compute an estimated residue level for use in Dietary Exposure Evaluation Model-Food Consumption Intake Database (DEEM-FCID), an average residue level was calculated using ½ level of detection

(LOD)for nondetects (0.005 ppm) together with the three detected levels of 2.5, 5.0, and 5.0 ppm. This provided an estimated residue level of oxytetracycline in livestock commodities of 0.0058 ppm. This value was used for all livestock commodities in the DEEM-FCID analyses. iii. *Cancer* There was no evidence of carcinogenicity for male or female mice fed oxytetracycline hydrochloride for two years. Results from carcinogenicity studies in rats were less clear cut (equivaocal); however, based on the weight of the evidence, the EPA has classified oxytetracycline as a “Group D” carcinogen (“Not Classifiable as to Human Carcinogenicity”). Therefore, a cancer risk assessment was not conducted. iv. *Anticipated residue and percent crop treated

(PCT)information* . Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide residues that have been measured in food. If EPA relies on such information, EPA must pursuant to section 408(f)(1) of FFDCA require that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. For the present action, EPA will issue such Data Call-Ins as are required by section 408(b)(2)(E) of FFDCA and authorized under section 408(f)(1) of FFDCA. Data will be required to be submitted no later than 5 years from the date of issuance of this tolerance. Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if: a. The data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain such pesticide residue. b. The exposure estimate does not underestimate exposure for any significant subpopulation group. c. Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area. In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by section 408(b)(2)(F) of FFDCA, EPA may require registrants to submit data on PCT. The Agency used PCT information as follows: 5% peaches, 5% nectarines, and 25% pears. The Agency used projected percent crop treated

(PPCT)information for apples assuming 10% of apples are treated. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available federal, state, and private market survey data for that use, averaging by year, averaging across all years, and rounding up to the nearest multiple of five percent except for those situations in which the average PCT is less than one. In those cases <1% is used as the average and <2.5% is used as the maximum. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the single maximum value reported overall from available federal, state, and private market survey data on the existing use, across all years, and rounded up to the nearest multiple of five percent. In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), Proprietary Market Surveys, and the National Center for Food and Agriculture Policy (NCFAP) for the most recent 6 years. Generally, estimated PCT at the national level for a given crop/year may be equated to the average of all corresponding state PCTs weighted by their state acres grown. Such estimates take account of usage (or lack of usage) in all states for which the crop is grown and for which data are available. However, for a new use with previous usage occurring only under Section 18s, estimated PCT calculated over all growing states may understate what PCT would be upon Section 3 registration because that calculation may include states with no usage because they were not granted Section 18s. (However, this may not hold if all states where the product is efficacious were granted Section 18 emergency exemptions.) Therefore, to provide conservative PPCT estimates based on historical usage under Section 18s, only states with Section 18s are included in the PCT computations for each year. That is, for each year, estimated PCT for states with Section 18s is computed as the weighted average of state PCTs taken over only states with Section 18s. This extrapolates Section 18 usage to the national level. The computation utilizes data from the U.S. Department of Agriculture National Agricultural Statistics Service (USDA/NASS) because such data are readily available and are not proprietary. For risk assessment, the average over years of the weighted average state PCTs is appropriate to use as the PPCT estimate for use in chronic dietary risk assessment, and maximum over years is appropriate for use in acute dietary risk assessment. This approach is conservative because use is likely to be higher in states which requested emergency exemptions as compared to states which did not have such a severe need that they relied on the emergency exemption route. Predominant factors that bear on whether the estimated PPCTs for oxytetracycline on apples could be exceeded may include the history and scope of the relevant Section 18s, the presence or lack of alternatives and other factors. All relevant information currently available for predominant factors has been considered for oxytetracycline on apples. The Agency believes that the three conditions listed in Unit III.D.iv. have been met. With respect to Condition 1, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions 2 and 3, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available information on the regional consumption of food to which oxytetracycline may be applied in a particular area. 2. *Dietary exposure from drinking water* . The Agency lacks sufficient monitoring data to complete a comprehensive dietary exposure analysis and risk assessment for oxytetracycline in drinking water. Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the environmental fate characteristics of oxytetracycline. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at *http://www.epa.gov/oppefed1/models/water/index.htm* . Based on the First Index Reservoir Screening Tool (FIRST) and Screening Concentration in Ground Water (SCI-GROW) models, the estimated environmental concentrations

(EECs)of oxytetracycline for chronic exposures are estimated to be 4.6 parts per billion

(ppb)for surface water and 0.33 ppb for ground water. Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. The estimates were calculated based on the maximum use pattern for oxytetracycline assuming 9 separate applications of oxytetracycline calcium to peaches and/or nectarines at a rate of 0.642 lb ai/A with a 7-day retreatment interval. For chronic dietary risk assessment, the annual average concentration of 4.6 ppb was used to assess the contribution to drinking water. 3. *From non-dietary exposure* . The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Oxytetracycline is not registered for use on any sites that would result in residential exposure. 4. *Cumulative effects from substances with a common mechanism of toxicity* . Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.” Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, EPA has not made a common mechanism of toxicity finding as to oxytetracycline and any other substances and oxytetracycline does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has not assumed that oxytetracycline has a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's website at *http://www.epa.gov/pesticides/cumulative* . D. Safety Factor for Infants and Children 1. *In general* . Section 408 of FFDCA provides that EPA shall apply an additional (“10X”) tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the FQPA safety factor. In applying this provision, EPA either retains the default value of 10X when reliable data do not support the choice of a different factor, or, if reliable data are available, EPA uses a different additional FQPA safety factor value based on the use of traditional UFs and/or special FQPA safety factors, as appropriate. 2. *Prenatal and postnatal sensitivity* . No quantitative or qualitative evidence suggests increased susceptibility of rat or mouse fetuses from *in utero* exposure to oxytetracycline in the developmental toxicity studies. Effects on offspring body weight were seen in the presence of systemic effects in the dam. The data requirement for the 2-generation reproduction study has been waived but a study available in literature demonstrates no quantitative or qualitative evidence of increased susceptibility in rats. 3. *Conclusion* . Historically, all the toxicological data requirements for oxytetracycline have been waived. The prenatal developmental and carcinogenicity studies in rats and mice were the only acceptable studies submitted to the EPA. However, given the extensive literature and study reports available on oxytetracycline, the risk assessment takes a weight-of-the-evidence approach, considering the available data from a variety of sources, including studies submitted and reviewed by the EPA, the National Toxicology Program, the World Health Organization (WHO), the FDA, and open literature studies. The information available on the effects of oxytetracycline in laboratory animals is sufficient to evaluate the toxicity of oxytetracycline and related compounds. Based on the information available from these sources, the database is complete and there are no datagaps. EPA has determined that reliable data show that it would be safe for infants and children to reduce the FQPA safety factor to 1X. The decision is based on the following findings: i. The toxicity database is complete. ii There is a low degree of concern and no residual uncertainties with regard to pre- and/or postnatal toxicity. iii. A developmental neurotoxicity study is not required because there was no evidence of neurotoxicity in the current toxicity database. iv. The dietary food exposure assessment utilizes mean residue levels and percent crop treated information for all relevant commodities, and monitoring data to estimate possible livestock residue levels. By using these refined assessments, chronic exposures are not likely to be underestimated. The dietary drinking water assessment (Tier 1 estimates) yields values generated by modeling methods which are designed to provide conservative, health protective, high-end estimates of water concentrations. v. In the previous risk assessments for oxytetracycline the 1993 Reregistration Eligibility Decisision ( *http://www.epa.gov/pesticides/reregistration/status_page_o.htm* ) the reference dose was established at 0.005 mg/kg/body weight per day based on a NOAEL of 0.05 mg/kg body weight per day from the microbiological study in dogs. However, only an UF of 10 to account for intraspecies variability was used since it was determined that the dog gut is similar to that of humans. For this current assessment, EPA has used an UF of 100 to account for intraspecies and interspecies variablility. Though the reduction of the FQPA safety factor from 10x to 1x does not explicitly address the bacterial resistance issue, the chronic dietary endpoint

(cPAD)is based on this effect. Therefore, the current risk assessment is sufficiently conservative and protective of infants and children. E. Aggregate Risks and Determination of Safety Safety is assessed for acute and chronic risks by comparing aggregate exposure to the pesticide to the aPAD and cPAD. The aPAD and cPAD are calculated by dividing the LOC by all applicable UFs. For linear cancer risks, EPA calculates the probability of additional cancer cases given aggregate exposure. Short-, intermediate-, and long-term risks are evaluated by comparing aggregate exposure to the LOC to ensure that the MOE called for by the product of all applicable UFs is not exceeded. 1. *Acute risk* . There were no toxic effects attributable to a single dose. An endpoint of concern was not identified to quantitate an acute-dietary risk to the U.S. general population or to the subpopulation females 13-50 years old. Therefore, oxytetracycline is not expected to pose an acute risk. 2. *Chronic risk* . Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that exposure to oxytetracycline from food and water will utilize 32% of the chronic population adjusted dose

(cPAD)for the U.S. population, 97% of the cPAD for all infants less than 1 year old, the subpopulation at greatest exposure, and 92% of the cPAD for children 1-2 years old. There are no residential uses for oxytetracycline that result in chronic residential exposure to oxytetracyline. 3. *Short-term and intermediate-term risk* . Short-term and intermediate-term aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Oxytetracycline is not registered for use on any sites that would result in residential exposure. Therefore, the aggregate risk is the sum of the risk from food and water. 4. *Aggregate cancer risk for U.S. population* . As discussed in Unit III.D.iii., EPA has classified oxytetracycline as a “Group D” carcinogen (“Not Classifiable as to Human Carcinogenicity”). Therefore, a cancer risk assessment was not conducted. 5. *Pharmaceutical aggregate risk* . Section 408 of the FFDCA requires EPA to consider potential sources of exposure to a pesticide and related substances in addition to the dietary sources expected to result from a pesticide use subject to the tolerance. In order to determine whether to maintain a pesticide tolerance, EPA must “determine that there is a reasonable certainty of no harm.” Under FFDCA section 505, the Food and Drug Administration reviews human drugs for safety and effectiveness and may approve a drug notwithstanding the possibility that some users may experience adverse side effects. EPA does not believe that, for purposes of the section 408 dietary risk assessment, it is compelled to treat a pharmaceutical user the same as a non-user, or to assume that combined exposures to pesticide and pharmaceutical residues that lead to a physiological effect in the user constitutes “harm” under the meaning of section 408 of the FFDCA. Rather, EPA believes the appropriate way to consider the pharmaceutical use of oxytetracycline in its risk assessment is to examine the impact that the additional nonoccupational pesticide exposures would have to a pharmaceutical user exposed to a related (or, in some cases, the same) compound. Where the additional pesticide exposure has no more than a minimal impact on the pharmaceutical user, EPA could make a reasonable certainty of no harm finding for the pesticide tolerances of that compound under section 408 of the FFDCA. If the potential impact on the pharmaceutical user as a result of co-exposure from pesticide use is more than minimal, then EPA would not be able to conclude that dietary residues were safe, and would need to discuss with FDA appropriate measures to reduce exposure from one or both sources. EPA provided its findings with respect to oxytetracycline to FDA in a letter dated May 24, 2006, which is available in the public docket (EPA-HQ-OPP-2005-0492). The pesticidal exposure estimates described in the May 24, 2006 letter reflect the dietary dose from pesticidal uses of oxytetracycline that a user treated with a pharmaceutical oxytetracycline product would receive in a reasonable worst-case scenario. EPA's pesticide exposure assessment has taken into consideration the appropriate population, exposure route, and exposure duration for comparison with exposure to the pharmaceutical use of oxytetracycline. EPA estimates that the pharmaceutical oxytetracycline exposure a user is expected to receive from a typical therapeutic dose (25 mg/kg/day for children) is 50,000 to 200,000 times greater than the estimated dietary exposure from the pesticidal sources of oxytetracycline (0.000121 mg/kg/day to 0.000473 mg/kg/day). Therefore, because the pesticide exposure has no more than a minimal impact on the total dose to a pharmaceutical user, EPA believes that there is a reasonable certainty that the potential dietary pesticide exposure will result in no harm to a user being treated therapeutically with oxytetracycline. FDA is aware of EPA's conclusions regarding pesticide exposure in users receiving treatment with a pharmaceutical oxytetracycline drug product and FDA's June 7, 2006 response to EPA is available the public docket (EPA-HQ-OPP-2005-0492). 6. *Determination of safety* . Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to oxytetracycline residues. IV. Other Considerations A. Analytical Enforcement Methodology HWI Method MR-OPAP-MA with modifications is used to measure and evaluate oxytetracycline residues. The method is adapted from Pfizer Method STP No. 012.14 entitled Microbiological Agar Diffusion Assay for Oxytetracycline in Fruit Extract and Hazelton Method OTCF entitled Oxytetracycline in Feeds which is published in Official Methods of Analysis of the AOAC, 15th Edition as Method 968.50. The method is similar to Final Action Microbiological Methods I and II in the AOAC Official Methods of Analysis (1984; 42.293-42.298). Although there is an enforcement method for oxytetracycline, it could be improved. The available method is nonspecific and the data generated by the method indicate that recoveries are generally low and markedly variable. As a condition of registration, EPA has required that the registrant develop an improved enforcement method based on HPLC, similar to AOAC methods 995.09 and 995.04, which use HPLC to determine tetracycline levels in animal tissues and milk, respectively. B. International Residue Limits There are currently no Codex maximum residue levels

(MRLs)for oxytetracycline. C. Response to Comments Several comments were received from a private citizen objecting to IR-4 Rutgers University increasing the use of this pesticide and establishment of tolerances. The Agency has received these same comments from this commenter on numerous previous occasions. Refer to **Federal Register** 70 FR 37686 (June 30, 2005), 70 FR 1354 (January 7, 2005), 69 FR 63096-63098 (October 29, 2004) for the Agency's response to these objections. V. Conclusion Therefore, the tolerance is established for residues of oxytetracycline in or on apple at 0.35 ppm VI. Statutory and Executive Order Reviews This final rule establishes a tolerance under section 408(d) of FFDCA in response to a petition submitted to the Agency. The Office of Management and Budget

(OMB)has exempted these types of actions from review under Executive Order 12866, entitled *Regulatory Planning and Review* (58 FR 51735, October 4, 1993). Because this rule has been exempted from review under Executive Order 12866, this rule is not subject to Executive Order 13211, *Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use* (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled *Protection of Children from Environmental Health Risks and Safety Risks* (62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 *et seq* ., nor does it require any special considerations under Executive Order 12898, entitled *Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations* (59 FR 7629, February 16, 1994). Since tolerances and exemptions that are established on the basis of a petition under section 408(d) of FFDCA, such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act

(RFA)(5 U.S.C. 601 *et seq* .) do not apply. This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of section 408(n)(4) of FFDCA. As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled *Federalism* (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled *Consultation and Coordination with Indian Tribal Governments* (65 FR 67249, November 6, 2000) do not apply to this rule. In addition, This rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995

(UMRA)(Public Law 104-4). This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note). VII. Congressional Review Act The Congressional Review Act, 5 U.S.C. 801 *et seq* ., generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of this final rule in the **Federal Register** . This final rule is not a “major rule” as defined by 5 U.S.C. 804(2). List of Subjects in 40 CFR Part 180 Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements. Dated: October 29, 2007. Donald R. Stubbs, Acting Director, Registration Division, Office of Pesticide Programs. Therefore, 40 CFR chapter I is amended as follows: PART 180—AMENDED 1. The authority citation for part 180 continues to read as follows: Authority: 21 U.S.C. 321(q), 346a and 371. 2. Section 180.337 is amended by alphabetically adding the following commodity to the table to read as follows: § 180.337 Oxytetracycline; tolerance for residues. * * * Commodity Parts per million Apple 0.35 * * * * * [FR Doc. E7-21796 Filed 11-6-07; 8:45 am] BILLING CODE 6560-50-S DEPARTMENT OF TRANSPORTATION Federal Motor Carrier Safety Administration 49 CFR Part 385 FMCSA Policy on Calculating Crash Rates and Driver, Vehicle, and Hazardous Materials Out-of-Service Rates and the Top 30 Percent of the National Average Under 49 CFR 385.407 AGENCY: Federal Motor Carrier Safety Administration (FMCSA). ACTION: Notice of enforcement policy. SUMMARY: FMCSA may not issue a hazardous materials safety permit to a motor carrier that has a crash rate, driver, vehicle or hazardous material out-of-service rate in the top 30 percent of the national average pursuant to 49 CFR 385.407. This document states the FMCSA policy on calculating motor carrier crash rates, and driver, vehicle, and hazardous material out-of-service rates that represent the top 30 percent of the national average as indicated in the Motor Carrier Management Information System (MCMIS). The document explains how FMCSA calculates the top thirty percent of the national average and how it calculates whether a single motor carrier falls within the top thirty percent of the national average in each of these categories. The document restates without change the FMCSA policy that has been publicly available on its Web site since January 2005. EFFECTIVE DATE: January 3, 2005. FOR FURTHER INFORMATION CONTACT: James O. Simmons, Office of Enforcement and Compliance, Hazardous Materials Division, 1200 New Jersey Avenue, SE., Washington, DC 20590,

(202)493-0496 (voice), *james.simmons@dot.gov* (e-mail), Debra S. Straus, Office of the Chief Counsel,

(202)366-2266 (voice), or *debra.straus@dot.gov* (e-mail). SUPPLEMENTARY INFORMATION: *Background:* Congress established the hazardous materials safety permit (safety permit) requirement as part of the Hazardous Materials Transportation Uniform Safety Act of 1990 (“HMTUSA”) Public Law 101-615, 104 Stat. 3244 (Nov. 16, 1990). On January 1, 2000, the Federal Motor Carrier Safety Administration (FMCSA) was established as a separate administration within the U.S. Department of Transportation pursuant to the Motor Carrier Safety Improvement Act of 1999. FMCSA assumed responsibility for the enforcement of hazardous materials transportation laws by motor vehicle transportation. On June 30, 2004, FMCSA issued a Final Rule containing the regulations implementing the safety permit program. 69 FR 39350. The Final Rule, codified at 49 CFR Part 385, identifies who must hold a safety permit, establishes the application process for a safety permit, and the conditions that must be satisfied before FMCSA will issue a safety permit to a carrier. Those conditions are set out in 49 CFR 385.407. Section 385.407 requires that a carrier must have a “Satisfactory” safety rating, must certify that it has a satisfactory security program, and must be properly registered with the Pipeline and Hazardous Materials Safety Administration (PHMSA). 49 CFR 385.407(a)(1), 385.407(b) & (c). Section 385.407(a)(2) additionally states that FMCSA will not issue a safety permit to a motor carrier that * * *:

(ii)Has a crash rate in the top 30 percent of the national average as indicated in the FMCSA Motor Carrier Management Information System (MCMIS); or

(iii)Has a driver, vehicle, hazardous materials, or total out-of-service rate in the top 30 percent of the national average as indicated in the MCMIS. The safety permit requirement became effective for motor carriers on the date after January 1, 2005, when the motor carrier was required to file a Motor Carrier Identification Report Form (MCS-150) according to a schedule set forth in 49 CFR 390.19(a). A motor carrier is required to file its MCS-150 form every two years. Thus, the safety permit requirement was implemented over the course of two years as motor carriers subject to the permit requirement reached the date for filing their MCS-150. The application for the safety permit was incorporated into the MCS-150, as an expanded form entitled “MCS-150B or Combined Motor Carrier Identification Report and HM Permit Application.” On or about January 3, 2005, the Office of Enforcement and Compliance

(OEC)published on its public Web site 1 the formula for determining the national average, the crash rates and driver, vehicle and hazmat out-of-service

(OOS)rates that established the threshold for the “top 30 percent of the national average,” and other information about calculating these rates. The website also explained how a carrier can calculate its own crash and OOS rates. For OOS rates, OEC explained that it determined the top 30 percent of the national average as follows: 1 *http://www.safersys.org/HazMatRatesPost.aspx#OOSRates.* To calculate this percentage for

(OOS)Rate, FMCSA looked at the driver, vehicle, or HM OOS percentage rates of all carriers (HM and non-HM) for calendar years 2003 and 2004. FMCSA then determined what the numerical value was that resulted in 70 percent of the carriers having a driver, vehicle, or HM OOS percentage rate lower than that figure, and 30 percent of the carriers having a driver, vehicle, or HM OOS percentage rate higher than that figure. The published guidance also instructed carriers on how to calculate their OOS percentage rates: Divide the total number of out-of-service inspections from the previous twelve month time period for each category by the total number of inspections for that category for the same twelve month time period. For example, if for the previous twelve month time period a motor carrier had twenty driver inspections and two of these resulted in an out-of-service condition then the Driver out-of-service rate would be 0.10. (2 ÷ 20 × 100% = 10%) The OEC Web site provided notice to the regulated community on how FMCSA would establish the national averages and cut-offs for the top, or worst-performing, 30 percent of the motor carrier population. Using these formulas, FMCSA established the thresholds for crash rates, vehicle, driver, and hazardous materials OOS rates and published these thresholds on its Web site in January 2005. The thresholds remained effective for the first two years of the program. In January 2007, using data for calendar years 2005 and 2006, FMCSA recalculated the top thirty percent of the national average and published the threshold crash rates, driver, vehicle, and hazardous materials OOS rates that would be effective in 2007 and 2008. The threshold rates were as follows: Motor carrier crash rate Driver OOS rate Vehicle OOS rate Hazmat OOS rate 2005 & 2006 0.125 8.92% 33.3% 5.88% 2007 & 2008 0.125 9.52% 33.33% 6.06% Challenges to the Rule Over the course of the two-year implementation period of the safety permit requirement, two motor carriers that were denied safety permits challenged the adequacy of the notice to the regulated community of FMCSA's method for calculating the top thirty percent of the national average and the crash and OOS rates for individual carriers. Despite the clear and accessible notice on the agency's public Web site of the threshold rates and the method by which these rates and those of individual carriers are calculated, the challenging motor carriers asserted that this notice was insufficient because it was not published in the **Federal Register** . FMCSA maintains its position that adequate and fair notice was provided to the regulated community of the method by which it would apply the conditions for issuing a safety permit under 49 CFR 385.407. Nevertheless, to foreclose further challenges, FMCSA is restating its methodology through this publication in the **Federal Register** . Subpart E—Hazardous Materials Safety Permits Calculating Crash Rates Under 49 CFR 385.407(a)(2)(ii), FMCSA may not issue a safety permit to a motor carrier that has a crash rate in the top 30 percent of the national average as indicated in the MCMIS. To calculate the threshold rate above which a motor carrier's crash rate will fall into the top, or worst-performing, 30 percent of the national average, FMCSA looked at all carriers in its census (HM and non-HM) that had more than one crash during the previous two-years. To calculate the national average, FMCSA:

(1)Determined the number of crashes for each qualifying carrier over a two-year period.

(2)Determined the number of power units that the carrier operated over the two year period.

(3)For each carrier, divided the number of crashes by the number of power units times 2 to determine each carrier's crash rate, i.e., [(# of crashes) ÷ (# of power units × 2) = crash rate].

(4)Using these rates, determined the numerical value that resulted in 70 percent of the carriers having a crash rate lower than that figure, and 30 percent of the carriers having a crash rate higher than that figure. The resulting numerical value represents the threshold for the worst-performing 30 percent of the national average. The threshold crash rate will be recalculated every two years using the crash data from the previous two years. FMCSA examines two years of data in order to evaluate crash rates that accurately represent occurrences in the industry and that will remain consistent throughout the two-year period during which carriers are required to apply for a safety permit. (The calculations to determine crash rates have been performed in this manner since the inception of the program in January 2005. Information on the Web site erroneously indicated that only one year of data was considered in setting the national averages when in fact two years of data has consistently been used.) FMCSA examines one year of crash data to determine the crash rate for an individual carrier that is applying for a safety permit. The carrier will divide the number of crashes for the previous twelve-month period by the total number of power units that it operated during that twelve-month period. For example, if a motor carrier had 2 crashes and 10 power units, the crash rate would be 0.20 based upon a calculation of (2 = 10 = 0.20). FMCSA examines one year of data to remain consistent with FMCSA practice of reviewing one year of records during a compliance review. FMCSA does not consider a single crash to be statistically valid. Thus, crash rates will be calculated only for carriers with more than one crash in the previous twelve-month period. Calculating Out-of-Service

(OOS)Rates Under 49 CFR 385.407(a)(2)(iii), FMCSA may not issue a safety permit to a motor carrier that has a driver, vehicle, hazardous material or total out-of-service

(OOS)rate in the top 30 percent of the national average as indicated in the MCMIS. To calculate the threshold rates above which a motor carrier's rate will fall into the top, or worst-performing, 30 percent of the national average for each of the listed categories, FMCSA separately examined the driver, vehicle, or hazmat OOS rate of all the carriers in its census. OEC did not include carriers that only had one inspection and only considered hazmat carriers in the calculation for the hazmat OOS rate. OEC examined two years of data, initially for calendar years 2003 and 2004, and subsequently, for calendar years 2005 and 2006. In each category, OEC determined the OOS rate for each qualifying carrier in the census by dividing the total number of OOS violations by the total number of inspections over the two-year period. For the hazmat OOS rate, the total number of hazmat OOS violations was divided by the total number of hazmat inspections over the two-year period. OEC then determined the numerical value that resulted in 70 percent of the carriers having a driver, vehicle, or hazmat OOS rate lower than that figure, and 30 percent of the carriers having a driver, vehicle, or hazmat OOS percentage rate higher than that figure. These numbers established the threshold above which a carrier falls into the top, or worst-performing, 30 percent of the national average in each category. OEC determined that looking at a total OOS rate was redundant and that total OOS rates were adequately considered by the examination of OOS rates in each of the three categories. The threshold rates representing the cut-off for the top thirty percent of the national average will be recalculated every two years on the first workday of the year. The first calculations for the national average were made on January 3, 2005 using the available MCMIS data for calendar years 2003 and 2004, the second calculations for the national average were made on January 3, 2007, using the available MCMIS data for calendar years 2005 and 2006. A motor carrier calculates its OOS rate in each of the three categories by examining the number of inspections and OOS violations during the preceding twelve-month period. The carrier must then divide the number of OOS violations for the category by the total number of inspections for that category. The resulting figure is the motor carrier's OOS rate for the particular category. For example, if during the previous twelve-month period, a motor carrier had twenty driver inspections and two of these resulted in an OOS condition, the driver OOS rate would be 0.10 (2 ÷ 20 = 0.10 or 10%). Each of the OOS categories, Driver, Vehicle, and Hazardous Materials, shall be calculated separately. FMCSA does not consider a single OOS inspection in any category to be statistically valid and thus will not deny a permit to a carrier based upon an OOS rate that results from a single OOS inspection. Issued on: October 31, 2007. John H. Hill, Administrator. [FR Doc. E7-21833 Filed 11-6-07; 8:45 am] BILLING CODE 4910-EX-P 72 215 Wednesday, November 7, 2007 Proposed Rules DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service 9 CFR Part 88 [Docket No. APHIS-2006-0168] RIN 0579-AC49 Commercial Transportation of Equines to Slaughter AGENCY: Animal and Plant Health Inspection Service, USDA. ACTION: Proposed rule. SUMMARY: We are proposing to amend the regulations regarding the commercial transportation of equines to slaughter to add a definition of *equine for slaughter* and make other changes that will extend the protections afforded by the regulations to equines bound for slaughter but delivered first to an assembly point, feedlot, or stockyard. This action would further ensure the humane treatment of such equines by helping to ensure that the unique and special needs of equines in commercial transportation to slaughter are met. DATES: We will consider all comments that we receive on or before January 7, 2008. ADDRESSES: You may submit comments by either of the following methods: *Federal eRulemaking Portal:* Go to *http://www.regulations.gov* , select “Animal and Plant Health Inspection Service” from the agency drop-down menu, then click “Submit.” In the Docket ID column, select APHIS-2006-0168 to submit or view public comments and to view supporting and related materials available electronically. Information on using Regulations.gov, including instructions for accessing documents, submitting comments, and viewing the docket after the close of the comment period, is available through the site's “User Tips” link. *Postal Mail/Commercial Delivery:* Please send four copies of your comment (an original and three copies) to Docket No. APHIS-2006-0168, Regulatory Analysis and Development, PPD, APHIS, Station 3A-03.8, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state that your comment refers to Docket No. APHIS-2006-0168. *Reading Room:* You may read any comments that we receive on this docket in our reading room. The reading room is located in room 1141 of the USDA South Building, 14th Street and Independence Avenue, SW., Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure someone is there to help you, please call

(202)690-2817 before coming. *Other Information:* Additional information about APHIS and its programs is available on the Internet at *http://www.aphis.usda.gov.* FOR FURTHER INFORMATION CONTACT: Dr. Timothy Cordes, Senior Staff Veterinarian, Equine Programs, National Center for Animal Health Programs, VS, APHIS, 4700 River Road Unit 46, Riverdale, MD 20737-1231;

(301)734-3279. SUPPLEMENTARY INFORMATION: Background On December 7, 2001, we published in the **Federal Register** (66 FR 63588-63617, Docket No. 98-074-2) a final rule that established regulations concerning the commercial transportation of equines for slaughter. That rulemaking was initiated under the provisions of the Federal Agriculture Improvement and Reform Act of 1996 (the Act), in which Congress, recognizing that equines being transported to slaughter have unique and special needs, authorized the Secretary of Agriculture to issue guidelines for the regulation of the commercial transportation of equines for slaughter by persons regularly engaged in that activity in the United States (see 7 U.S.C. 1901 note). The regulations in 9 CFR part 88 (the regulations) contain minimum standards to ensure the humane movement of equines for slaughter via commercial transportation. The regulations cover, among other things, the food, water, and rest provided to such equines prior to their transportation to slaughter, standards for conveyances used to transport equines to slaughter, and certain paperwork required to accompany equines during such transportation. The regulations also require the owner/shipper of the equines to take certain actions to ensure the safety and humane treatment of equines during loading and transportation for slaughter, including seeking immediate assistance from an equine veterinarian for any equine in obvious physical distress. In addition, the regulations prohibit the commercial transportation to slaughtering facilities of equines considered to be unfit for travel, the use of electric prods on equines in commercial transportation to slaughter, and, after December 7, 2006, the use of double-deck trailers for commercial transportation of equines to slaughtering facilities. The Act defines “equine for slaughter” as “any member of the Equidae family being transferred to a slaughter facility, including an assembly point, feedlot, or stockyard.” The regulations in 9 CFR part 88 apply to equines moved in commercial transportation to slaughtering establishments but not to equines bound for slaughter but moved first to an assembly point, feedlot or stockyard. When the regulations were established in 2001, we believed that equines transported to slaughtering establishments were at high risk of being treated inhumanely, and that equines transported to assembly points, feedlots, or stockyards were likely to be treated well, either to bring more money at slaughter or to be sold for other purposes. Five years later, it appears that equines in commercial transportation to slaughtering facilities, specifically, are being treated humanely, in accordance with the regulations. As the regulations are written, equines sold as slaughter horses may be transported first to an assembly point, for example, in a double-deck trailer and without any of the other protections afforded by the regulations, such as receiving adequate water and food prior to loading. We believe that equines may be delivered to these intermediate points en route to slaughter for the sole purpose of avoiding compliance with the regulations. In particular, since December 7, 2006, when the regulations no longer allowed double-deck trailers to transport equines to slaughtering facilities, truckers who wish to continue using double-deck trailers for slaughter horses have an incentive to transport them to assembly points, feedlots, or stockyards, where the horses could then be reloaded onto straight-deck trailers for the final leg of the trip to the slaughtering plant. We have received numerous reports of this situation occurring. Given these developments, it now appears that equines that are bound for slaughter but are delivered first to an assembly point, feedlot, or stockyard are at higher risk for inhumane treatment. To close this loophole, we are proposing to amend the regulations to add a definition for the term *equine for slaughter* to read “any member of the Equidae family being transferred to a slaughter facility, including an assembly point, feedlot, or stockyard.” We also propose to amend § 88.2(b), § 88.3(a) introductory text, § 88.3(b), § 88.4(a) introductory text, and § 88.4(b)(4), (c), (d), and

(e)by replacing the words “equines to a slaughtering facility”, “equines to slaughtering facilities”, “equines in commercial transportation to slaughtering facilities”, “equine to the slaughtering facility”, and “equines in commercial transportation to a slaughtering facility” with the term “equines for slaughter”. Lastly, we are proposing to amend § 88.4(b) introductory text by replacing the words “transit to the slaughtering facility” with the words “commercial transportation of equines for slaughter”. We would consider equines delivered to an assembly point, feedlot, or stockyard to be equines for slaughter and subject to the regulations unless the owner/shipper presents an official certificate of veterinary inspection and the original copy of a negative equine infectious anemia test chart, or other documents that indicate the names and addresses of the consigner, consignee, owner, and examining veterinarian for any equine being shipped, as evidence that the equines are not equines for slaughter. Executive Order 12866 and Regulatory Flexibility Act This proposed rule has been reviewed under Executive Order 12866. The rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget. The Regulatory Flexibility Act

(RFA)requires agencies to evaluate the potential effects of their rules on small entities. The analysis that follows represents an initial regulatory flexibility analysis in accordance with the requirements of the RFA. Because data on the commercial transport of equines to intermediate points en route to slaughter is sparse at best, we were not able to conduct a comprehensive analysis of the proposed rule's potential economic impact. Accordingly, we welcome public comment that would enable us to more fully assess the proposal's impact. We are particularly interested in public comment on the impact of the ban on double-deck trailers for use in transporting equines for slaughter. APHIS's regulations in 9 CFR part 88 are designed to help ensure the humane commercial transport of equines to slaughter. Specifically, the regulations require that: • For a period of not less than 6 consecutive hours immediately prior to the equines being loaded on the conveyance for transport, each equine be provided access to food and water and the opportunity to rest; • Any equine that has been on the conveyance for 28 consecutive hours or more without food, water, and the opportunity to rest be offloaded and, for at least 6 consecutive hours, provided with food, water, and the opportunity to rest; • Each equine be provided with enough space on the conveyance to ensure that no animal is crowded in a way likely to cause injury or discomfort; • Stallions and other aggressive equines be segregated from each other and all other equines on the conveyance; • Electric prods be used only in life-threatening situations; and • An owner-shipper certificate be completed for each equine prior to departing for the slaughtering facility. Among other things, the certificate must certify the equine's fitness to travel and note any special care and handling needs during transit. 1 1 An equine is considered fit to travel if it:

(1)Can bear weight on all four limbs;

(2)can walk unassisted;

(3)is not blind in both eyes;

(4)is older than 6 months of age; and

(5)is not likely to give birth in transit. The owner or commercial shipper must sign the certificate, and it must accompany the equine to the slaughtering facility. At present, the regulations apply only to equines moved directly to slaughtering establishments, and not to equines bound for slaughter but moved first to an assembly point, feedlot, or stockyard. This proposed rule would amend the regulations to make equines delivered to intermediate points en route to slaughter subject to the same regulations as those moved directly to slaughtering establishments. This proposed rule is intended to ensure the humane treatment of equines delivered to intermediate points en route to slaughter. Equines are generally slaughtered for their meat, which is sold for human consumption, primarily outside the United States. 2 In 2005, the United States exported 39.5 million pounds of horse, ass, and mule meat, with a value of $61.1 million. Of the total volume exported in 2005, 35.3 million pounds, or 89 percent, was shipped to five countries (Belgium, France, Mexico, Russia, and Switzerland). 3 2 Horses account for almost all equines slaughtered in the United States. 3 Source: *World Trade Atlas* (U.S. Census Bureau). From 2003 through 2005, an average of 70,094 equines were slaughtered annually in federally inspected U.S. slaughtering facilities. 4 During that period, and at the time this analysis was prepared, there were three slaughtering facilities that accepted equines in the continental United States: Two were located in Texas and one in Illinois. However, following a Federal appeals court ruling, the two facilities in Texas are now closed. Following an unsuccessful challenge to a State law to stay open, the Illinois facility is also closed. 4 Source: USDA (NASS), *Livestock Slaughter Summary* (2003, 2004, 2005). APHIS estimates that there are no more than 100 entities in the U.S. currently involved in the commercial transportation of equines to slaughter. As discussed below, the transport of slaughter equines to intermediate points is not uncommon. Based on the average number of equines slaughtered in the United States each year between 2003 and 2005 (approximately 70,000) and on the estimated number of potentially affected shippers (approximately 100), the average number of equines transported annually per shipper is 700. Economic Effects on Owners and Commercial Shippers The “path” from source supplier (farmer, rancher, pet owner, etc.) to slaughtering facility can vary. However, the most common scenario and the one used for the purpose of this analysis is as follows: The source suppliers transport their equines to local auction markets, where the equines are sold to persons who purchase the equines for the specific purposes of selling them to a slaughtering facility. (Hereafter, for the purposes of this initial regulatory flexibility analysis, we will refer to persons who sell equines for slaughter as “owners”; however, in some cases, the owners use agents to conduct some aspect of the business of purchasing equines and transporting and selling them to slaughtering facilities. We will use the term “owner” to refer to either the actual owners or their agents.) The owners consider price lists published by the slaughtering facilities for equines (the price varies in relation to the weight of the equine and the quality of the meat), transportation costs, and profit requirements to establish the maximum prices that they will pay for equines at local auctions. Because the owners cannot usually purchase enough slaughter-quality equines at any one auction to make it economically feasible to ship the animals directly from the auction site to the slaughtering facility, the owners transport the equines back to their own farms or feedlots where the equines are kept until such time as the owners can accumulate more equines from other auctions. When enough equines have been accumulated to comprise a shipment, the owners transport the equines to the slaughtering facility. In an estimated 75 percent of cases, owners hire commercial shippers to move the equines to the slaughtering facilities; in the remaining estimated 25 percent of cases, owners transport the equines to slaughter in their own conveyances. Based on the slaughter scenario described above, this proposed rule has the potential to economically affect owners who purchase equines at local auction markets and then transport the animals to their farms, feedlots, or other assembly points prior to shipping them on to slaughter. (The owners' farms and feedlots are intermediate stops en route to slaughter.) However, the proposed rule also has the potential to affect owners and commercial shippers who transport equines from the owners' farms or feedlots to assembly points, feedlots, and stockyards prior to the animals' final delivery to a slaughtering facility. We are aware that such transport to intermediate points between the owner's farms or feedlots and the slaughtering facility occurs but we do not know the extent of that transport. However, we have no reason to believe it is significant. The proposed rule is likely to have little or no impact on most owners who transport equines from local auction markets to their farms or feedlots. There are several reasons. First, equines sold for slaughter at auctions usually have access to food, water, and rest for at least 6 hours prior to being transported to the owners' farms and feedlots. Sellers at auction markets have an incentive to provide equines with food and water because malnourished equines have a reduced slaughter value. Furthermore, most slaughter equines tend to be in their pens at auction markets for at least 6 hours, since it usually takes at least that long for them to be sold. Indeed, it is not uncommon for slaughter horses to be sold at the end of an auction session, after the saddle horses are sold. The requirement that equines have access to food, water, and rest for at least 6 consecutive hours immediately prior to the animals being loaded on the conveyance should not be a problem for owners who transport equines from auction sites. Second, owners typically purchase equines at auction markets that are in relatively close proximity to their farms and feedlots. It is unlikely, therefore, that equines acquired at auctions will have to be offloaded for feeding, rest, etc., while en route to the owners' farms or feedlots, since it is unlikely that the trip will take longer than 28 hours. Third, the proposed rule would require that, during transport to intermediate points, equines be provided with enough space to ensure that they are not crowded in a way that is likely to cause injury or discomfort. The proposed rule would specifically ban the use of double-deck trailers for such transport, as those types of conveyances are a source of animal injury and discomfort. However, owners who transport equines from local auction markets to their farms or feedlots generally do not do so using double-deck trailers. The transport to owner farms and feedlots almost always occurs in smaller capacity conveyances, such as straight-deck and goose-neck trailers. 5 That owners transport the animals back to their own farms or feedlots (rather than to slaughtering facilities directly) only because they cannot purchase enough slaughter-quality equines at any one auction is, in itself, an indication that they have no need for the higher capacity double-deck trailers for such transport. Although overcrowding can also occur in single-deck (also called straight-deck) trailers, there is no evidence to suggest that it is an issue for owners who pick up slaughter equines at auction markets. 5 Double-deck livestock trailers can carry up to about 45 equines each; single-deck trailers can carry up to about 38 equines each. Prior to the ban that became effective December 8, 2006, double-deck trailers were most often used for transporting equines to slaughter facilities. Fourth, the restriction on the use of electric prods should not pose a burden because effective, low-cost substitutes are available for use in non-life-threatening situations. For example, fiberglass poles with flags attached, which cost no more than about $10 each, are considered to be an effective alternative to electric prods. (Any current use of electric prods by transporters of slaughter equines probably derives from the traditional use of these devices to assist in moving other livestock, such as cattle and swine.) Finally, available data suggest that the segregation of stallions and other aggressive equines is already a common transport practice. Owners have an incentive to make sure that aggressive equines are segregated because equines that arrive at the slaughtering facilities injured as the result of biting and kicking en route command lower market values. Furthermore, relatively few stallions are transported for slaughter. USDA personnel stationed at two of the slaughtering facilities have estimated that no more than about 5 percent of equines arriving for slaughter are stallions. Accordingly, the requirement that stallions and other aggressive equines be segregated during transport to slaughter is not likely to have a significant economic effect on owners who pick up equines at various auction markets. As indicated above, the proposed rule also has the potential to affect owners and commercial shippers who transport equines from the owner's farms or feedlots to assembly points, feedlots, and stockyards prior to the animals' final delivery to a slaughtering facility. These entities are more likely to be affected by the proposed rule than owners who transport equines from auction markets to their farms and feedlots only, because they are more likely to be using double-deck trailers. (This is because equines are typically moved from owners' farms and feedlots only when enough equines have been accumulated to comprise a full shipment, a situation which is likely to foster use of the higher-capacity double-deck trailers.) Nonetheless, we believe that owners and commercial shippers who transport equines from owners' farms or feedlots to intermediate points prior to the animals' final delivery to a slaughtering facility are likely to be in compliance with most parts of the proposed rule. Nor should the “28-hour” rule pose a problem for the vast majority of owners and commercial shippers who transport equines from owners' farms or feedlots to intermediate points prior to the animals' final shipment to a slaughtering facility. Even in a worst-case scenario in terms of travel distance (i.e., equines transported from farms or feedlots on the east or west coasts to border crossing points in closest proximity to the slaughtering facilities in Mexico, which are all located in the central part of the United States), the overwhelming majority of trips should take less than 28 hours. Assuming an average highway speed of 55 mph and two different drivers, and allowing 1.5 hours for loading and 2 hours for refueling and meal stops, even a trip as long as 1,300 miles would take only about 27 hours. 6 6 It is common transport practice to use two different drivers on long trips. This practice allows the equines to be transported virtually nonstop because one person can drive while the other rests, thereby avoiding federally mandated rest periods that apply in a single-driver situation. Double-deck trailers can carry more equines than single-deck trailers, and owners and shippers who are using the former will be affected by the reduction in the number of equines that could be transported in a single conveyance. However, for affected owners and commercial shippers, the ban on double-deck trailers is likely to be mitigated by several factors. First, commercial shippers can use their double-deck trailers to transport other livestock and produce. In this regard, it has been estimated that double-deck trailers in general carry equines no more than about 10 percent of the time they are in use. Second, owners who cannot find another use for the double-deck trailers can trade them for single-deck trailers. Owners should be able to sell their serviceable trailers at fair market value to transporters of commodities other than equines. In conclusion, we believe that most transporters to intermediate points are already in compliance with most or all of the proposed rule's requirements. Those that are not now in compliance are likely to be owners and commercial shippers who transport equines from owners' farms or feedlots to intermediate points prior to the animals' final delivery to a slaughtering facility, since their load volume fosters the use of the higher capacity double-deck trailers. While we know that transport to intermediate points between the owners' farms or feedlots and the slaughtering facility occurs, we do not believe it is at a level that this proposed rule would result in any significant economic impacts. Impact on Horse Slaughtering Facilities The proposed rule also has the potential to economically affect the horse slaughtering facilities, to the extent that it could negatively affect the supply of slaughter horses. As indicated above, there are currently no horse slaughtering facilities operating in the United States, however, the possibility exists that such facilities could open in the future. As a result of the ban on double-deck trailers, for example, fewer transporters may be willing to haul slaughter horses, and those that are willing will have to do it in smaller capacity single-deck trailers. A decline in supply has implications for the slaughtering facility since it may lead to an increase in the price they pay to acquire horses. Nevertheless, as indicated above, we believe that most transporters to intermediate points are already in compliance with most or all of the proposed rule's requirements, including the prohibition on double-deck trailers. Impact on Small Entities As indicated above, it is estimated that no more than about 100 entities are potentially affected by the proposed rule, most of whom are equine owners and commercial shippers. Although we do not have specific information on the annual receipts of these entities, it is reasonable to assume that most are small by U.S. Small Business Administration

(SBA)standards. This assumption is based on composite data for providers of the same and similar services in the United States. In 2002, the most recent year for which data is available, there were 44,933 U.S. establishments in North American Industry Classification System (NAICS) categories 48422 and 48423, which comprise firms primarily engaged in specialized freight trucking, including the transportation of livestock. The per-establishment average gross receipts for all 44,933 establishments that year was $0.9 million, well below the SBA's small-entity threshold of $23.5 million. Similarly, in 2002, there were 1,048 U.S. establishments in NAICS 42459, a classification category that includes horse dealers. For all 1,048 establishments, the per-establishment average number of employees that year was 7, well below the SBA's small-entity threshold of 100 employees for those firms. 7 7 Source: SBA and U.S. Census Bureau (2002 Economic Census). APHIS has not identified any duplication, overlap, or conflict of this proposed rule with other Federal rules. Alternatives In developing the current regulations, APHIS opted for a number of alternatives designed to lessen the economic effects of the regulations on affected small entities, including a deferral, for 5 years, of the effective date for the prohibition on double-deck trailers. 8 The ban on double-deck trailers under the current regulations took effect December 8, 2006, which means that owner-shippers that currently use double-deck trailers to transport equines to intermediate points would face a ban on the use of those trailers under the proposed rule. 8 The final rule published in 2001 noted that a 5-year deferral allows slaughter facilities time to respond to the expected decline in the number of transporters willing to haul horses to slaughter, including time to budget and to arrange for financing of equipment they may need to acquire if they must haul horses on their own because commercial shippers and owners will not. Public comment on the proposed rule's economic impact is invited, especially comment on any impact for small entities stemming from prohibition on the use of double-deck trailers to move equines to intermediate points, such as stockyards and feedlots, before moving them to a slaughter facility. Executive Order 12372 This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.) Executive Order 12988 This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. If this proposed rule is adopted:

(1)All State and local laws and regulations that are in conflict with this rule will be preempted;

(2)no retroactive effect will be given to this rule; and

(3)administrative proceedings will not be required before parties may file suit in court challenging this rule. Paperwork Reduction Act In accordance with section 3507(j) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ), the information collection and recordkeeping requirements included in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB). Please send written comments to the Office of Information and Regulatory Affairs, OMB, Attention: Desk Officer for APHIS, Washington, DC 20503. Please state that your comments refer to Docket No. APHIS-2006-0168. Please send a copy of your comments to:

(1)Docket No. APHIS-2006-0168, Regulatory Analysis and Development, PPD, APHIS, Station 3A-03.8, 4700 River Road Unit 118, Riverdale, MD 20737-1238, and

(2)Clearance Officer, OCIO, USDA, room 404-W, 14th Street and Independence Avenue, SW., Washington, DC 20250. A comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication of this proposed rule. This proposed rule would amend the regulations in 9 CFR part 88 to provide for the humane treatment of equines en route to slaughter facilities through intermediate points. We are soliciting comments from the public (as well as affected agencies) concerning our information collection and recordkeeping requirements. These comments will help us:

(1)Evaluate whether the information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;

(2)Evaluate the accuracy of our estimate of the burden of the information collection, including the validity of the methodology and assumptions used;

(3)Enhance the quality, utility, and clarity of the information to be collected; and

(4)Minimize the burden of the information collection on those who are to respond (such as through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology; e.g., permitting electronic submission of responses). *Estimate of burden:* Public reporting burden for this collection of information is estimated to average 0.834960937 hours per response. *Respondents:* Owners and shippers of slaughter horses and drivers of vehicles of equines for slaughter. *Estimated annual number of respondents:* 130. *Estimated annual number of responses per respondent:* 39.38461538. *Estimated annual number of responses:* 5,120. *Estimated total annual burden on respondents:* 4,275 hours. (Due to averaging, the total annual burden hours may not equal the product of the annual number of responses multiplied by the reporting burden per response.) Copies of this information collection can be obtained from Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at

(301)734-7477. E-Government Act Compliance The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this proposed rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at

(301)734-7477. List of Subjects in 9 CFR Part 88 Animal welfare, Horses, Reporting and recordkeeping requirements, Transportation. Accordingly, we are proposing to amend 9 CFR part 88 as follows: PART 88—COMMERCIAL TRANSPORTATION OF EQUINES FOR SLAUGHTER 1. The authority citation for part 88 continues to read as follows: Authority: 7 U.S.C. 1901, 7 CFR 2.22, 2.80, 371.4. 2. Section 88.1 is amended by adding, in alphabetical order, a new definition for *equine for slaughter* to read as follows: § 88.1 Definitions. *Equine for slaughter.* Any member of the Equidae family being transferred to a slaughter facility, including an assembly point, feedlot, or stockyard. § 88.2 [Amended] 3. In § 88.2, paragraph

(b)is amended by removing the words “equines to a slaughtering facility” and adding the words “equines for slaughter” in their place. § 88.3 [Amended] 4. Section 88.3 is amended as follows: a. In paragraph (a), introductory text, by removing the words “equines to slaughtering facilities” and adding the words “equines for slaughter” in their place. b. In paragraph (b), by removing the words “Equines in commercial transportation to slaughtering facilities” and adding the words “Equines for slaughter” in their place. § 88.4 [Amended] 5. Section 88.4 is amended as follows: a. In paragraph (a), introductory text, by removing the words “equines to a slaughtering facility” and adding the words “equines for slaughter” in their place. b. In paragraph (a)(3), by removing the words “transit to the slaughtering facility” and adding the words “throughout transit to slaughter” in their place. c. In paragraph (b), introductory text, by removing the words “transit to the slaughtering facility” and adding the words “commercial transportation of equines for slaughter” in their place. d. In paragraph (b)(4), by removing the words “equine to the slaughtering facility” and adding the words “equines for slaughter” in their place. e. In paragraph (c), by removing the words “equines in commercial transportation to a slaughtering facility” both times they occur and adding the words “equines for slaughter” in their place. f. In paragraphs

(d)and (e), by removing the words “equines to a slaughtering facility” and adding the words “equines for slaughter” in their place. Done in Washington, DC, this 1st day of November 2007. Kevin Shea, Acting Administrator, Animal and Plant Health Inspection Service. [FR Doc. E7-21896 Filed 11-6-07; 8:45 am] BILLING CODE 3410-34-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-0163; Directorate Identifier 2007-NM-046-AD] RIN 2120-AA64 Airworthiness Directives; Boeing Model 737-300, -400, -500, -600, -700, -700C, -800, and -900 Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to adopt a new airworthiness directive

(AD)for certain Boeing Model 737-300, -400, -500, -600, -700, -700C, -800, and -900 series airplanes. This proposed AD would require installing a new circuit breaker, relays, and wiring to allow the flightcrew to turn off electrical power to the in-flight entertainment

(IFE)systems and other non-essential electrical systems through a switch in the flight compartment, and doing other specified actions. This proposed AD results from an IFE systems review. We are proposing this AD to ensure that the flightcrew is able to turn off electrical power to IFE systems and other non-essential electrical systems through a switch in the flight compartment. The flightcrew's inability to turn off power to IFE systems and other non-essential electrical systems during a non-normal or emergency situation could result in the inability to control smoke or fumes in the airplane flight deck or cabin. DATES: We must receive comments on this proposed AD by December 24, 2007. ADDRESSES: You may send comments by any of the following methods: • *Federal eRulemaking Portal:* Go to *http://www.regulations.gov.* Follow the instructions for submitting comments. • *Fax:* 202-493-2251. • *Mail:* U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. • *Hand Delivery:* U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. For service information identified in this AD, contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207. Examining the AD Docket You may examine the AD docket on the Internet at *http://www.regulations.gov* ; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt. FOR FURTHER INFORMATION CONTACT: Shohreh Safarian, Aerospace Engineer, Systems and Equipment Branch, ANM-130S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98057-3356; telephone

(425)917-6418; fax

(425)917-6590. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2007-0163; Directorate Identifier 2007-NM-046-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments. We will post all comments we receive, without change, to *http://www.regulations.gov,* including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this proposed AD. Discussion The Federal Aviation Administration

(FAA)completed a review of in-flight entertainment

(IFE)systems installed on transport category airplanes. The review focused on the interface between the IFE system and airplane electrical system, with the objective of determining if any unsafe conditions exist with regard to the interface. The type of IFE systems considered for review were those that contain video monitors (cathode ray tubes or liquid crystal displays, either hanging above the aisle or mounted on individual seat backs or seat trays), or complex circuitry (i.e., power supplies, electronic distribution boxes, extensive wire routing, relatively high power consumption, multiple layers of circuit protection, etc.). In addition, in-seat power supply systems that provide power to more than 20 percent of the total passenger seats were also considered for the review. The types of IFE systems not considered for review include systems that provide only audio signals to each passenger seat, ordinary in-flight telephone systems (e.g., one telephone handset per group of seats or bulkhead-mounted telephones), systems that have only a video monitor on the forward bulkhead(s) (or a projection system) to provide passengers with basic airplane and flight information, and in-seat power supply systems that provide power to less than 20 percent of the total passenger seats. Items considered during the review include the following: • Can the electrical bus(es) supplying power to the IFE system be de-energized when necessary without removing power from systems that might be required for continued safe flight and landing? • Can IFE system power be removed when required without pulling IFE system circuit breakers (i.e., is there a switch (dedicated to the IFE system or a combination of loads) located in the flight deck or cabin that can be used to remove IFE power?)? • If the IFE system requires changes to flightcrew procedures, has the airplane flight manual

(AFM)been properly amended? • If the IFE system requires changes to cabin crew procedures, have they been properly amended? • Does the IFE system require periodic or special maintenance? In all, we reviewed approximately 180 IFE systems. The review results indicate that unsafe conditions exist on some IFE systems installed on various transport category airplanes. These conditions can be summarized as: • Electrical bus(es) supplying power to the IFE system cannot be de-energized when necessary without removing power from systems that might be required for continued safe flight and landing. • Power cannot be removed from the IFE system when required without pulling IFE system circuit breakers (i.e., there is no switch dedicated to the IFE system or combination of systems for the purpose of removing power). • Installation of the IFE system has affected crew (flightcrew and/or cabin crew) procedures, but the procedures have not been properly revised. Currently, certain Boeing Model 737-300, -400, -500, -600, -700, -700C, -800, and -900 series airplanes do not have a switch in the flight compartment allowing the flightcrew to turn off power to IFE systems and other non-essential electrical systems, in the event of smoke or fumes. The flightcrew's inability to turn off electrical power to IFE systems and other non-essential electrical systems, if not corrected, could result in the inability to control smoke or fumes in the airplane flight deck or passenger cabin during a non-normal or emergency situation. Relevant Service Information We have reviewed Boeing Service Bulletin 737-24-1145, dated March 4, 2004, for Model 737-300, -400, and -500 series airplanes. Boeing Service Bulletin 737-24-1145 describes procedures for installing a new circuit breaker, relays, and wiring to allow the flightcrew to turn off electrical power to IFE systems through the IFE/galley switch and for doing other specified actions. The other specified actions include rerouting the wiring between the IFE relays, disconnect panels, and circuit breakers; replacing the lightplate assembly at the P5-13 module assembly with a new lightplate assembly; and testing the IFE control systems. We have also reviewed Boeing Service Bulletin 737-24-1147, Revision 1, dated March 1, 2007, for Model 737-600, -700, -700C, -800, and -900 series airplanes. Boeing Service Bulletin 737-24-1147 describes procedures for installing a new circuit breaker, relays, and wiring to allow the flightcrew to turn off electrical power to the IFE systems and other non-essential electrical systems through a utility switch in the flight compartment. Part 1 of the Work Instructions, which is applicable to Groups 1 and 2 airplanes, describes procedures for changing the wiring on the E4-2 shelf assembly and testing the changed electrical control system to ensure it operates correctly. For Group 2 airplanes, Part 1 also describes procedures for installing new wiring and changing certain wiring between a terminal bus and circuit breaker. Part 2 of the Work Instructions, which is applicable to Groups 3 through 139 airplanes, describes the following procedures: • Installing a circuit breaker on the P6-11 panel door, a new terminal board and two new relays on the aft wall of the P6 electrical panel, a new relay adapter plate on the relay panel assembly, new wires W40 between the relays, terminal board, and the P6 disconnect panel assemblies, and a new relay on the relay plate assembly; and installing new wires W40/W44 and changing the wiring between the relays, circuit breakers, and disconnect panel assemblies. • Replacing the P5-13 module assembly with a new improved or modified P5-13 module assembly and installing new wires W2510 between the P5 overhead panel and the P6 electrical panel. • Changing the wiring W422 on the E4-2 shelf assembly and installing new wires W44 between the E4-2 shelf assembly and P6 electrical panel. • Testing the electrical supply and IFE control systems to ensure that they operate correctly. Part 3 of the Work Instructions, which is applicable to Groups 140 through 169 airplanes, describes procedures for making a wiring change to a certain wire bundle for the printer and testing the printer and changed systems to ensure they operate correctly. Boeing Service Bulletin 737-24-1145 specifies concurrent accomplishment of Boeing Component Service Bulletin 69-37321-31-03, dated August 21, 2003, for Model 737-300 series airplanes equipped with P5-13 module assembly, part number (P/N) 69-37321-81. Boeing Component Service Bulletin 69-37321-31-03 describes procedures for replacing the lightplate assembly at the P5-13 module assembly with a new lightplate assembly and reidentifying and testing the modified P5-13 module assembly. Boeing Service Bulletin 737-24-1147 specifies concurrent accomplishment of Boeing Component Service Bulletin 285A1840-24-02, dated August 28, 2003, for Model 737-600, -700, -700C, -800, and -900 series airplanes equipped with P5-13 module assembly, P/N 285A1840-3 or -4. Boeing Component Service Bulletin 285A1840-24-02 describes procedures for modifying the P5-13 module assembly. The modification includes installing new analog and interface printed wire assemblies

(PWAs)on the processor PWA, new toggle switches on the new front panel assembly, a new PWA cable between the analog and interface PWAs, new standoff posts on the interface and processor PWAs, the new front panel assembly on the new standoff posts, and a new light plate on the modified module assembly. Boeing Service Bulletin 737-24-1147 specifies prior or concurrent accomplishment of Boeing Service Bulletin 737-23-1189, dated June 27, 2002, for two Model 737-800 series airplanes. Boeing Service Bulletin 737-23-1189 describes procedures for installing wiring for the No. 4 video display unit

(VDU)cluster, an INOP marker, and stow clip at the P6-1 circuit breaker panel; rerouting certain wiring for the No. 4 VDU cluster between stations 685 and 767; and doing a continuity test of the newly installed and rerouted wire bundles. Accomplishing the actions specified in the service information is intended to adequately address the unsafe condition. FAA's Determination and Requirements of the Proposed AD We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other airplanes of this same type design. For this reason, we are proposing this AD, which would require accomplishing the actions specified in the service information described previously. Costs of Compliance There are about 1,617 airplanes of the affected design in the worldwide fleet. The following table provides the estimated costs, at an average labor rate of $80 per hour, for U.S. operators to comply with this proposed AD. Estimated Costs Model Action Work hours Parts Cost per airplane Number of U.S. -registered airplanes Fleet cost Model 737-300, -400, and -500 series airplanes Installation of circuit breaker, relays, and wiring Up to 31 Up to $2,925 $5,405 1 $5,405 Model 737-300 series airplanes Concurrent modification of P5-13 module assembly 1 2,327 2,407 1 2,407 737-600, -700, -700C, -800, and -900 series airplanes Installation of circuit breaker, relays, and wiring Up to 52 Up to 10,968 15,128 586 8,865,008 Concurrent modification of P5-13 module assembly 4 9,241 9,561 586 5,602,746 737-800 series airplanes Installation of wiring for the No. 4 VDU 12 3,372 4,332 2 8,664 Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration

(FAA)amends § 39.13 by adding the following new airworthiness directive (AD): **Boeing:** Docket No. FAA-2007-0163; Directorate Identifier 2007-NM-046-AD. Comments Due Date

(a)The FAA must receive comments on this AD action by December 24, 2007. Affected ADs

(b)None. Applicability

(c)This AD applies to the Boeing airplanes identified in paragraphs (c)(1) and (c)(2) of this AD, certificated in any category.

(1)Model 737-300, -400, and -500 series airplanes, as identified in Boeing Service Bulletin 737-24-1145, dated March 4, 2004.

(2)Model 737-600, -700, -700C, -800, and -900 series airplanes, as identified in Boeing Service Bulletin 737-24-1147, Revision 1, dated March 1, 2007. Unsafe Condition

(d)This AD results from an in-flight entertainment

(IFE)systems review. We are issuing this AD to ensure that the flightcrew is able to turn off electrical power to IFE systems and other non-essential electrical systems through a switch in the flight compartment. The flightcrew's inability to turn off power to IFE systems and other non-essential electrical systems during a non-normal or emergency situation could result in the inability to control smoke or fumes in the airplane flight deck or cabin. Compliance

(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Install Circuit Breaker, Relays, and Wiring on Model 737-300, -400, and -500 Series Airplanes

(f)For Model 737-300, -400, and -500 series airplanes: Within 60 months after the effective date of this AD, install a new circuit breaker, relays, and wiring to allow the flightcrew to turn off electrical power to the IFE systems through the IFE/galley switch and do all other specified actions as applicable, by accomplishing all the applicable actions specified in the Accomplishment Instructions of Boeing Service Bulletin 737-24-1145, dated March 4, 2004. Concurrently Modify P5-13 Module Assembly on Model 737-300 Series Airplanes

(g)For Model 737-300 series airplanes identified as Group 6 airplanes in Boeing Service Bulletin 737-24-1145, dated March 4, 2004, and equipped with P5-13 module assembly part number (P/N) 69-37321-81: Prior to or concurrently with accomplishing the actions required by paragraph

(f)of this AD, replace the lightplate assembly of the P5-13 module assembly with a new lightplate assembly and reidentify and test the modified P5-13 module assembly, in accordance with Boeing Component Service Bulletin 69-37321-31-03, dated August 21, 2003. Install Circuit Breaker, Relays, and Wiring on Model 737-600, -700, -700C, -800, and -900 Series Airplanes

(h)For Model 737-600, -700, -700C, -800, and -900 series airplanes: Within 60 months after the effective date of this AD, install a new circuit breaker, relays, and wiring, as applicable, to allow the flightcrew to turn off electrical power to the IFE systems and other non-essential electrical systems through a utility switch in the flight compartment, by accomplishing all of the applicable actions specified in Parts 1, 2, or 3 of the Work Instructions of Boeing Service Bulletin 737-24-1147, Revision 1, dated March 1, 2007. Concurrently Modify P5-13 Module Assembly on Model 737-600, -700, -700C, -800, and -900 Series Airplanes

(i)For Model 737-600, -700, -700C, -800, and -900 series airplanes identified as Groups 1 through 139 inclusive in Boeing Service Bulletin 737-24-1147, Revision 1, dated March 1, 2007, and equipped with P5-13 module assembly P/N 285A1840-3 or -4: Prior to or concurrently with accomplishing the actions required by paragraph

(h)of this AD, modify the P5-13 module assembly, in accordance with Boeing Component Service Bulletin 285A1840-24-02, dated August 28, 2003. Wiring Installation for the Video Display Unit

(j)For Model 737-800 series airplanes identified in paragraph 1.A.1. of Boeing Service Bulletin 737-23-1189, dated June 27, 2002: Prior to or concurrently with accomplishing the actions required by paragraph

(h)of this AD, install wiring for the No. 4 VDU cluster, an INOP marker, and stow clip at the P6-1 circuit breaker panel; reroute certain wiring for the No. 4 VDU cluster between stations 685 and 767; and do a continuity test of the newly installed and rerouted wiring; in accordance with Boeing Service Bulletin 737-23-1189, dated June 27, 2002. Alternative Methods of Compliance (AMOCs) (k)(1) The Manager, Seattle Aircraft Certification Office, FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.

(2)To request a different method of compliance or a different compliance time for this AD, follow the procedures in 14 CFR 39.19. Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector

(PI)in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO. Issued in Renton, Washington, on October 15, 2007. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-21843 Filed 11-6-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1 and 301 [REG-209020-86] RIN 1545-AC09 Foreign Tax Credit: Notification of Foreign Tax Redeterminations AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Partial withdrawal of notice of proposed rulemaking and notice of proposed rulemaking by cross-reference to temporary regulations. SUMMARY: This document withdraws portions of the notice of proposed rulemaking published on June 23, 1988, relating to sections 905(c) and 6689 (the 1988 proposed regulations). In addition, in the Rules and Regulations section of this issue of the **Federal Register** , the IRS and the Treasury Department are issuing temporary regulations relating to a taxpayer's obligation under section 905(c) of the Internal Revenue Code to notify the IRS of a foreign tax redetermination. The IRS and the Treasury Department are also issuing temporary regulations on Procedure and Administration under section 6689 relating to the civil penalty for failure to notify the IRS of a foreign tax redetermination as required under section 905(c). These temporary regulations affect taxpayers that have paid foreign taxes which have been redetermined and provide guidance needed to comply with statutory changes made to the applicable law by the Taxpayer Relief Act of 1997 and the American Jobs Creation Act of 2004. The text of those temporary regulations also serves as the text of these proposed regulations. DATES: Written or electronic comments and requests for a public hearing must be received by February 5, 2008. ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-209020-86), room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-209020-90), Courier's Desk, Internal Revenue Service, 1111 Constitution Ave., NW., Washington, DC or sent electronically via the Federal eRulemaking Portal at *www.regulations.gov* (IRS REG-209020-86). FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, Teresa Burridge Hughes,

(202)622-3850 (not a toll-free number); concerning the submission of comments, Kelly Banks,

(202)622-7180 (not a toll-free number). SUPPLEMENTARY INFORMATION: Paperwork Reduction Act The collections of information contained in this notice of proposed rulemaking have been submitted to the Office of Management and Budget for review in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)). Comments on the collection of information should be sent to the Office of Management and Budget, Attn: Desk Officer for the Department of Treasury, Office of Information and Regulatory Affairs, Washington, DC 20503, with copies to the Internal Revenue Service, Attn: IRS Reports Clearance Officer, SE:W:CAR:MP:T:T:SP, Washington, DC 20224. Comments on the collection of information should be received by January 7, 2008. Comments are specifically requested concerning: Whether the proposed collections of information is necessary for the proper performance of the functions of the IRS, including whether the information will have practical utility; The accuracy of the estimated burden associated with the proposed collections of information; How the quality, utility, and clarity of the information to be collected may be enhanced; How the burden of complying with the proposed collections of information may be minimized, including through the application of automated collection techniques or other forms of information technology; and Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of service to provide information. The collections of information in this notice of proposed rulemaking are in § 1.905-4. This information is required to enable the IRS to verify the amounts of the foreign tax redeterminations and to determine the amount of the penalty under section 6689, if a taxpayer fails to notify the IRS of a foreign tax redetermination. This information will be used by the IRS for examination purposes. The collections of information are mandatory. The likely respondents are individuals and business or other for-profit institutions. *Estimated total annual reporting:* 54,000 hours. The estimated annual burden per respondent varies from 3 hours to 8 hours, depending on individual circumstances, with an estimated average of 4.2 hours. *Estimated number of respondents:* 13,000. *Estimated frequency of responses:* Annually. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by the Office of Management and Budget. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103. Background and Explanation of Provisions On June 23, 1988, the IRS published in the **Federal Register** a notice of proposed rulemaking (53 FR 23659) (INTL-061-86) (the 1988 proposed regulations) that would have provided rules with respect to the time and manner of reporting a foreign tax redetermination and to the penalty under section 6689. Written comments were received; however, no hearing was requested or held. Subsequently, section 1102(a)(1) and 1102(a)(2) of the Taxpayer Relief Act of 1997, Public Law 105-34 (111 Stat. 788, 963-966 (1997)), amended section 905(c), effective for taxes paid or accrued in taxable years beginning after December 31, 1997. Subsequently, section 408(a) of the American Jobs Creation Act of 2004, Public Law 108-357 (118 Stat. 1418, 1499 (2004)), modified section 986(a), effective for taxable years beginning after December 31, 2004. In light of the comments received on the 1988 proposed regulations and the statutory changes to sections 905(c) and 986(a), sections of the 1988 proposed regulations are revised and other sections are withdrawn. The preamble to the temporary regulations explains the temporary regulations and these proposed regulations. Special Analyses It has been determined that this notice of proposed rulemaking is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to the following regulations, §§ 1.905-3, 1.905-4, 1.905-5, and 301.6689-1. With respect to § 1.905-4, it is hereby certified that this regulation will not have a significant economic impact on a substantial number of small entities. This certification is based on the fact that the collection of information requirement under § 1.905-4 that is imposed on small entities flows directly from section 905(c), which states that, “[T]he taxpayer shall notify the Secretary,” of a foreign tax redetermination that may result in a redetermination of the taxpayer's United States tax liability. In order for the taxpayer to satisfy this notification requirement, information with respect to all foreign tax redeterminations must be collected. Therefore, a regulatory flexibility analysis is not required. Pursuant to section 7805(f) of the Internal Revenue Code, this regulation has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small businesses. Comments and Requests for a Public Hearing Before these proposed regulations are adopted as final regulations, consideration will be given to any written (a signed original and eight

(8)copies) or electronic comments that are submitted timely to the IRS. All comments will be available for public inspection and copying. A public hearing may be scheduled if requested in writing by any person that timely submits written or electronic comments. If a public hearing is scheduled, notice of the date, time, and place for the public hearing will be published in the **Federal Register** . Drafting Information The principal author of this document is Teresa Burridge Hughes, Office of Associate Chief Counsel (International). However, other personnel from the IRS and the Treasury Department participated in its development. List of Subjects 26 CFR Part 1 Income taxes, Reporting and recordkeeping requirements. 26 CFR Part 301 Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income taxes, Penalties, Reporting and recordkeeping requirements. Partial Withdrawal of a Notice of Proposed Rulemaking Under the authority of 26 U.S.C. 7805, § 1.905-3(d)(2)(iii) and

(iv)and § 1.905-3(d)(4) of the notice of proposed rulemaking (INTL-061-86, REG-209020-86) published in the **Federal Register** on June 23, 1988 (53 FR 23659) are withdrawn. Proposed Amendments to the Regulations Accordingly, 26 CFR parts 1 and 301 are proposed to be amended as follows: PART 1—INCOME TAXES **Paragraph 1.** The authority citation for part 1 continues to read as follows: Authority: 26 U.S.C. 7805 * * * **Par. 2.** Section 1.905-3 is added to read as follows: § 1.905-3 Adjustments to United States tax liability and to the pools of post-1986 undistributed earnings and post-1986 foreign income taxes as a result of a foreign tax redetermination. [The text of this section is the same as the text of § 1.905-3T(a) through

(e)published elsewhere in this issue of the **Federal Register** .] **Par. 3.** Section 1.905-4 is added to read as follows: § 1.905-4 Notification of foreign tax redetermination. [The text of this section is the same as the text of § 1.905-4T(a) through (f)(2) published elsewhere in this issue of the **Federal Register** .] § 1.905-5 Foreign tax redeterminations and currency translation rules for foreign tax redeterminations occurring in taxable years beginning prior to January 1, 1987 (temporary). [The text of this section is the same as the text of § 1.905-5T(a) through

(f)published elsewhere in this issue of the **Federal Register** .] PART 301—PROCEDURE AND ADMINISTRATION **Par. 4.** The citation authority for part 301 continues to read as follows: Authority: 26 U.S.C. 7805 * * * **Par. 5.** Section 301.6689-1 is added to read as follows: § 301.6689-1 Failure to file notice of redetermination of foreign tax.

(a)[The text of the proposed amendments to § 301.6689-1(a) is the same as the text of § 301.6689-1T(a) published elsewhere in this issue of the **Federal Register** .]

(b)through

(d)[Reserved]. For further guidance, see § 301.6689-1T(b) through (d).

(e)[The text of the proposed amendments to § 301.6689-1(e)(1) is the same as the text of § 301.6689-1T(e)(1) published elsewhere in this issue of the **Federal Register** .] Kevin M. Brown, Deputy Commissioner for Services and Enforcement. [FR Doc. E7-21727 Filed 11-6-07; 8:45 am] BILLING CODE 4830-01-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2007-1009; FRL-8492-7] Approval and Promulgation of Air Quality Implementation Plans; State of Delaware Transportation Conformity Regulations AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: EPA is proposing to approve a State Implementation Plan

(SIP)revision submitted by the State of Delaware. This revision establishes the State's transportation conformity requirements. After they have been approved, the State regulations will govern transportation conformity determinations in the State of Delaware. This action is being taken under the Clean Air Act. DATES: Written comments must be received on or before December 7, 2007. ADDRESSES: Submit your comments, identified by Docket ID Number EPA-R03-OAR-2007-1009 by one of the following methods: A. *http://www.regulations.gov* . Follow the on-line instructions for submitting comments. . *E-mail:* *febbo.carol@epa.gov* . C. *Mail:* EPA-R03-OAR-2007-1009, Carol Febbo, Chief, Energy, Radiation and Indoor Environment Branch, Mailcode 3AP23, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. D. *Hand Delivery:* At the previously-listed EPA Region III address. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information. *Instructions:* Direct your comments to Docket ID No. EPA-R03-OAR-2007-1009. EPA's policy is that all comments received will be included in the public docket without change, and may be made available online at *www.regulations.gov* , including any personal information provided, unless the comment includes information claimed to be Confidential Business Information

(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *www.regulations.gov* or e-mail. The *www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through *www.regulations.gov* , your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. *Docket:* All documents in the electronic docket are listed in the *www.regulations.gov* index. Although listed in the index, some information is not publicly available, i.e., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in *www.regulations.gov* or in hard copy during normal business hours at the Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal are available at the Delaware Department of Natural Resources & Environmental Control, 89 Kings Highway, P.O. Box 1401, Dover, Delaware 19903. FOR FURTHER INFORMATION CONTACT: Martin Kotsch,

(215)814-3335, or by e-mail at *kotsch.martin@epa.gov* . SUPPLEMENTARY INFORMATION: Throughout this document whenever “we”, “us”, or “our” is used, we mean EPA. Table of Contents I. What Is Transportation Conformity? II. What Is the Background for This Action? III. What Did the State Submit and How Did We Evaluate It? IV. What Action Is EPA Taking Today? V. Statutory and Executive Order Reviews I. What Is Transportation Conformity? Transportation conformity is required under section 176(c) of the Clean Air Act to ensure that Federally supported highway, transit projects, and other activities are consistent with (conform to) the purpose of the SIP. Conformity currently applies to areas that are designated nonattainment, and those redesignated to attainment after 1990 (maintenance areas), with plans developed under section 175A of the Clean Air Act for the following transportation related criteria pollutants: ozone, particulate matter (PM 2.5 and PM 10 ), carbon monoxide (CO), and nitrogen dioxide (NO 2 ). Conformity to the purpose of the SIP means that transportation activities will not cause new air quality violations, worsen existing violations, or delay timely attainment of the relevant national ambient air quality standards (NAAQS). The transportation conformity regulation is found in 40 CFR part 93 and provisions related to conformity SIPs are found in 40 CFR 51.390. II. What Is the Background for This Action? On August 10, 2005, the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) was signed into law. SAFETEA-LU revised certain provisions of section 176(c) of the Clean Air Act, related to transportation conformity. Prior to SAFETEA-LU, states were required to address all of the Federal conformity rule's provisions in their conformity SIPs. After SAFETEA-LU, states' SIPs were required to contain all or portions of only the following three sections of the Federal rule, modified as appropriate to each state's circumstances: 40 CFR 93.105 (consultation procedures); 40 CFR 93.122(a)(4)(ii) (written commitments to implement certain kinds of control measures); and 40 CFR 93.125(c) (written commitments to implement certain kinds of mitigation measures). States are no longer required to submit conformity SIP revisions that address the other sections of the Federal conformity rule. III. What Did the State Submit and How Did We Evaluate It? On July 9, 2007, the Delaware Department of Natural Resources and Environmental Control (DNREC) submitted a revision to its State Implementation Plan

(SIP)for Transportation Conformity purposes. The SIP revision consists of the State Regulation 1132, Delaware Transportation Conformity Regulation. This SIP revision addresses the three provisions of the EPA Conformity Rule required under SAFETEA-LU: 40 CFR 93.105 (consultation procedures); 40 CFR 93.122(a)(4)(ii) (control measures) and, 40 CFR 93.125(c) (mitigation measures). We reviewed the submittal to assure consistency with the February 14, 2006 “Interim Guidance for Implementing the Transportation Conformity provisions in the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU).” The guidance document can be found at *http://epa.gov/otaq/stateresources/transconf/policy.htm* . The guidance document states that each state is only required to address and tailor the afore-mentioned three sections of the Federal Conformity Rule to be included in their state conformity SIPs. EPA's review of Delaware's proposed SIP indicates that it is consistent with EPA's guidance in that it includes the three elements specified by SAFETEA-LU. Consistent with the EPA Conformity Rule at 40 CFR 93.105 (consultation procedures), Regulation 1132(3) identifies the appropriate agencies, procedures and allocation of responsibilities as required under 40 CFR 93.105 for consultation procedures. In addition, Regulation 1132(3) provides for appropriate public consultation/public involvement consistent with 40 CFR 93.105. With respect to the requirements of 40 CFR 93.122(a)(4)(ii) and 40 CFR 93.125(c), Regulation 1132(4) specifies that written commitments for control measures and mitigation measures for meeting these requirements will be provided as needed. IV. What Action Is EPA Taking Today? EPA is proposing to approve the Delaware SIP revision for Transportation Conformity, which was submitted on July 9, 2007. This revision is being proposed under a procedure called parallel processing, whereby EPA proposes rulemaking action concurrently with the state's procedures for amending its regulations. If the proposed revision is changed in areas other than those identified in this action, EPA will evaluate those changes and may publish another notice of proposed rulemaking. If no changes are made, EPA will publish a Final Rulemaking Notice on the revisions. The final rulemaking action by EPA will occur only after the SIP revision has been adopted by the State of Delaware and submitted formally to EPA for incorporation into the SIP. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action. V. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This proposed action merely proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ). Because this rule proposes to approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). This proposed rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely proposes to approve a state rule implementing a Federal requirement, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This proposed rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it approves a state rule implementing a Federal standard. In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This proposed rule to approve Delaware's transportation conformity regulation does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Carbon monoxide, Intergovernmental relations, Nitrogen dioxide, Ozone, Particulate matter, Volatile organic compounds. Authority: 42 U.S.C. 7401 *et seq.* Dated: October 29, 2007. Donald S. Welsh, Regional Administrator, Region III. [FR Doc. E7-21853 Filed 11-6-07; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2007-0215; FRL-8493-3] Approval and Promulgation of Air Quality Implementation Plans; West Virginia; 110(a)(1) 8-Hour Ozone Maintenance Plan and Amendments to the 1-Hour Ozone Maintenance Plan AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: EPA is proposing to approve State Implementation Plan

(SIP)revisions submitted by West Virginia. These revisions pertain to: the maintenance plan prepared by West Virginia to maintain the 8-hour national ambient air quality standard (NAAQS) for ozone in Greenbrier County, which is designated attainment for the ozone NAAQS; and two amendments to the existing 1-hour ozone maintenance plan, which include

(a)removal of the obligation to submit a maintenance plan for the 1-hour NAAQS eight years after approval of the initial 1-hour maintenance plan, and

(b)removal of the State's obligation to implement contingency measures upon a violation of the 1-hour NAAQS. The purpose of this proposed approval is to ensure Federal enforceability of the state air program plan and to maintain consistency between the State-adopted plan and the approved SIP. This action is being taken under the Clean Air Act (CAA). DATES: Written comments must be received on or before December 7, 2007. ADDRESSES: Submit your comments, identified by Docket ID Number EPA-R03-OAR-2007-0215, by one of the following methods: A. *http://www.regulations.gov.* Follow the on-line instructions for submitting comments. *B. E-mail: powers.marilyn@epa.gov.* C. *Mail:* EPA-R03-OAR-2007-0215, Marilyn Powers, Acting Branch Chief, Air Quality Planning Branch, Mailcode 3AP21, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. D. *Hand Delivery:* At the previously-listed EPA Region III address. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information. *Instructions:* Direct your comments to Docket ID No. EPA-R03-OAR-2007-0215. EPA's policy is that all comments received will be included in the public docket without change, and may be made available online at *www.regulations.gov* , including any personal information provided, unless the comment includes information claimed to be Confidential Business Information

(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *www.regulations.gov* or e-mail. The *www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through *www.regulations.gov* , your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. *Docket:* All documents in the electronic docket are listed in the *www.regulations.gov* index. Although listed in the index, some information is not publicly available, i.e., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in *www.regulations.gov* or in hard copy during normal business hours at the Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal are available at the West Virginia Department of Environmental Protection, Division of Air Quality, 601 57th Street SE., Charleston, West Virginia 25304. FOR FURTHER INFORMATION CONTACT: Irene Shandruk,

(215)814-2166, or by e-mail at *shandruk.irene@epa.gov* . SUPPLEMENTARY INFORMATION: On November 29, 2006, the West Virginia Department of Environmental Protection (WVDEP) submitted a revision to its State Implementation Plan

(SIP)for approval of the section 110(a)(1) 8-hour Ozone Maintenance Plan for Greenbrier County, West Virginia, and for concurrent approval of two amendments to the existing 1-hour ozone maintenance plan. I. Background Section 110(a)(1) of the Clean Air Act

(CAA)requires, in part, that states submit to EPA plans to maintain any NAAQS promulgated by EPA. EPA interprets this provision to require that areas that were maintenance areas for the 1-hour ozone NAAQS but attainment for the 8-hour ozone NAAQS submit a plan to demonstrate the continued maintenance of the 8-hour ozone NAAQS. EPA established June 15, 2007, three years after the effective date of the initial 8-hour ozone designations, as the deadline for submission of plans for these areas. On May 20, 2005, EPA issued guidance that applies, in part, to areas that are designated attainment/unclassifiable for the 8-hour ozone standard and that had an approved 1-hour ozone maintenance plan. The purpose of the guidance, referred to as section 110(a)(1) guidance, is to assist the states in the development of a SIP which addresses the maintenance requirements found in section 110(a)(1) of the CAA. There are five components of the section 110(a)(1) maintenance plan which are:

(1)An attainment inventory, which is based on actual typical summer day emissions of volatile organic compounds

(VOCs)and oxides of nitrogen (NO X ) for a ten-year period from a base year as chosen by the state;

(2)a maintenance demonstration which shows how the area will remain in compliance with the 8-hour ozone standard for 10 years after the effective date of designations (June 15, 2004);

(3)a commitment to continue to operate air quality monitors;

(4)a contingency plan that will ensure that a violation of the 8-hour ozone NAAQS is promptly addressed; and

(5)an explanation of how the State will track the progress of the maintenance plan. II. Summary of SIP Revision The WVDEP 8-hour ozone maintenance plan addresses the components of the section 110(a)(1) 8-hour ozone maintenance plan as outlined in EPA's May 20, 2005 guidance. West Virginia has requested approval of its 8-hour ozone maintenance plan for Greenbrier County, as well as concurrent approval of two amendments to its existing 1-hour ozone maintenance plan. *Emissions Inventory:* An emissions inventory is an itemized list of emission estimates for sources of air pollution in a given area for a specified time period. WVDEP has provided a comprehensive and current emissions inventory for NO X and VOCs. WVDEP has chosen to use 2002 as the base year from which it will project emissions. The maintenance plan also includes an explanation of the methodology used for determining the anthropogenic (area and mobile sources) emissions. There are no Title V point sources located in Greenbrier County, so a 2002 point source inventory was not compiled. The inventory is based on emissions from a typical ozone season day. The term “typical” refers to emissions being emitted during a typical weekday during the months where ozone concentrations are typically the highest. *Maintenance Demonstration and Tracking Progress:* With regard to demonstrating continued maintenance of the 8-hour ozone standard, West Virginia projects that the total emissions from Greenbrier County will decrease during the ten-year maintenance period. WVDEP has projected emissions for 10 years from the effective date of initial designations, or 2014. In 2002, the total anthropogenic emissions in Greenbrier County were 7.7 tons/ozone season day for VOCs and 7.4 tons/ozone season day for NO X . The projected 2014 anthropogenic emissions from Greenbrier County are 7.0 tons/ozone season day for VOCs and 4.9 tons/ozone season day for NO X . As such, the plan demonstrates that, from an emissions projections standpoint, emissions are projected to decrease. It is important to note that the formation of ozone is dependent on a number of variables which cannot be estimated through emissions growth and reduction calculations. A few of these variables include weather and the transport of ozone precursors from outside the maintenance area. In the Section 110(a)(1) maintenance plan, WVDEP had indicated that the state will track the progress of the maintenance plan by updating the emissions inventory for Greenbrier County approximately every three years. The emissions inventory update will include point, area, and mobile emissions. Information from these future updates will be compared with the projected growth estimates for the 2002 base inventory data to track maintenance of the standard. *Ambient Monitoring:* With regard to the ambient air monitoring component of the maintenance plan, West Virginia commits to continue operating air quality monitoring stations in accordance with 40 CFR Part 58 throughout the maintenance period to verify maintenance of the 8-hour ozone standard, and will submit quality-assured ozone data to EPA through the AIRS system. *Contingency Measures:* EPA interprets Section 110(a)(1) of the CAA to require that the state develop a contingency plan that will ensure that any violation of a NAAQS is promptly corrected. The purposes of the contingency measures, as outlined in West Virginia's maintenance plan, is to accordingly select and adopt one or more measures outlined in the maintenance plan so as to assure continued attainment in the event that a violation of the ozone NAAQS is measured. Violation of the 8-hour ozone standard would trigger one or more of the control measures outlined in the plan. Approval of two amendments to West Virginia's existing 1-hour maintenance plan has also been requested by WVDEP. Section 175A(b) requires that maintenance plans be updated. The 1-hour maintenance plan for Greenbrier County extends to 2005, but no update has been developed. West Virginia identifies the most important reason for this being that available resources are being devoted to attainment and maintenance of the 8-hour standard since the 8-hour standard is considered by the State to be more protective than the former 1-hour standard upon which the current maintenance plan is based. As such, West Virginia is amending this existing maintenance plan, which is codified at 40 CFR 52.2420(e), for the Greenbrier County 1-hour maintenance area by removing the State's obligation to submit a maintenance plan for the 1-hour NAAQS eight years after approval of the initial 1-hour maintenance plan, and is requesting approval of these amendments. The WVDEP is requesting approval of the section 110(a)(1) 8-hour ozone maintenance plan for Greenbrier County, West Virginia as a revision to its SIP. This plan demonstrates how the State intends to maintain the 8-hour NAAQS for ozone. Additionally, WVDEP requested that pursuant to 40 CFR 51.905(e)(1), EPA concurrently approve two amendments to the existing 1-hour ozone maintenance plan:

(1)Removal of the obligation to submit a maintenance plan for the 1-hour NAAQS 8 years after approval of the initial 1-hour maintenance plan; and

(2)removal of the State's obligation to implement contingency measures upon a violation of the 1-hour NAAQS. West Virginia's SIP submittal meets the CAA requirements for SIP submittals. III. Proposed Action EPA's review of this material indicates that West Virginia has addressed the components of a maintenance plan pursuant to EPA's May 20, 2005 guidance. EPA is proposing to approve the West Virginia SIP revision for Greenbrier County, which was submitted on November 29, 2006. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action. IV. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)). This action merely proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ). Because this rule proposes to approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). This proposed rule also does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely proposes to approve a state rule implementing a Federal requirement, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. This proposed rule also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it approves a state rule implementing a Federal standard. In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the CAA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this proposed rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. This action proposing approval of the section 110(a)(1) 8-hour Ozone Maintenance Plan for Greenbrier County, West Virginia, and for concurrent approval of two amendments to the existing 1-hour ozone maintenance plan does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Nitrogen dioxide, Ozone, Reporting and Recordkeeping, Volatile organic compounds. Authority: 42 U.S.C. 7401 *et seq.* Dated: October 29, 2007. Donald S. Welsh, Regional Administrator, Region III. [FR Doc. E7-21866 Filed 11-6-07; 8:45 am] BILLING CODE 6560-50-P 72 215 Wednesday, November 7, 2007 Notices DEPARTMENT OF AGRICULTURE Agricultural Marketing Service [Docket Number: AMS-ST-07-0129; ST-07-03] Plant Variety Protection Board; Open Meeting AGENCY: Agricultural Marketing Service, USDA. ACTION: Notice of meeting. SUMMARY: This notice sets forth the schedule and proposed agenda of a forthcoming meeting of the Plant Variety Protection Board. DATES: November 14-15, 2007, 8:30 a.m. to 5 p.m., open to the public. ADDRESSES: The meeting will be held in the United States Department of Agriculture, National Agricultural Library, 10301 Baltimore Blvd., Beltsville, Maryland. FOR FURTHER INFORMATION CONTACT: Mrs. Janice M. Strachan, Plant Variety Protection Office, Science and Technology Programs, Agricultural Marketing Service, United States Department of Agriculture, Telephone number

(301)504-5518, fax

(301)504-5291, or e-mail *PVPOmail@usda.gov.* SUPPLEMENTARY INFORMATION: Pursuant to the provisions of section 10(a) of the Federal Advisory Committee Act, (U.S.C. App.2) this notice is given regarding a Plant Variety Protection

(PVP)Board meeting. The board is constituted under section 7 of the PVP Act (7 U.S.C. 2327). The proposed agenda for the meeting will include discussions of:

(1)The accomplishments of the PVP Office,

(2)The financial status of the PVP Office,

(3)PVP Office information technology infrastructure,

(4)Discussion of current program operations and long term strategic plan, and

(5)Other related topics. Upon entering the National Agricultural Library Building, visitors should inform security personnel that they are attending the PVP Board Meeting. Identification will be required to be admitted to the building. Security personnel will direct visitors to the registration table located outside of Room 1400. Registration upon arrival is necessary for all participants. If you require accommodations, such as sign language interpreter, please contact the person listed under FOR FURTHER INFORMATION CONTACT . Minutes of the meeting will be available for public review 30 days following the meeting at the address listed under FOR FURTHER INFORMATION CONTACT . The minutes will also be posted on the Internet Web site *http://www.ams.usda.gov/science/PVPO/PVPindex.htm.* Dated: November 1, 2007. Lloyd C. Day, Administrator, Agricultural Marketing Service. [FR Doc. E7-21831 Filed 11-6-07; 8:45 am] BILLING CODE 3410-02-P DEPARTMENT OF AGRICULTURE Forest Service Notice of New Fee Site; Federal Lands Recreation Enhancement Act (Title VIII, Pub. L. 108-447) AGENCY: Coronado National Forest, USDA Forest Service, Tucson, AZ. ACTION: Notice of New Fee Site. SUMMARY: The Coronado National Forest proposes to begin charging a new $150.00 per day fee for rental of the Half Moon Ranch located 9 miles west of Sunsites, Arizona. Rental of the Cabin includes overnight use. Rental of the cabin and other facilities within the Arizona National Forests has shown that the public appreciates and enjoys the availability of historic rental facilities. Funds from the rentals will be used for the continued operation and maintenance of the Half Moon Ranch. DATES: Half Moon Ranch will become available for rent July, 2008. ADDRESSES: Coronado National Forest, 300 West Congress, Tucson, AZ 85701. FOR FURTHER INFORMATION CONTACT: Kathy Makansi, Archaeologist, Coronado National Forest,

(520)760-2502. SUPPLEMENTARY INFORMATION: The Federal Recreation Lands Enhancement Act (Title VII, Pub. L. 108-447) directed the Secretary of Agriculture to publish a six month advance notice in the **Federal Register** whenever new recreation fee areas are established. The Coronado National Forest currently has one other rental facility. This facility is booked regularly throughout the rental season. A business analysis for the rental of the Half Moon Ranch shows that people desire having this sort of recreation experience on the Coronado National Forest. A market analysis indicates that the $150.00 daily fee is both reasonable and acceptable for this sort of unique recreation experience. People wanting to rent the Half Moon Ranch will need to do so through the National Recreation Reservation Service, at *http://www.recreation.gov* or by calling 1-877-444-6777. The National Recreation Reservation Service charges a $9 fee per reservation. Dated: November 1, 2007. Jeanine Derby, Forest Supervisor, Coronado National Forest. [FR Doc. 07-5549 Filed 11-6-07; 8:45 am]

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