Vessel Identification System

Note: EPA no longer updates this information, but it may be useful as a reference or resource.

[Federal Register: March 20, 2001 (Volume 66, Number 54)]
[Rules and Regulations]
[Page 15625-15635]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20mr01-6]

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DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Part 187

[USCG-1999-6420]
RIN 2115-AD35

Vessel Identification System

AGENCY: Coast Guard, DOT.

ACTION: Final rule.

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SUMMARY: The Coast Guard is amending its regulations on the voluntary
Vessel Identification System (VIS). VIS is a nationwide system for
collecting information on vessels and vessel ownership to help identify
and recover stolen vessels, deter vessel theft, and assist in deterring
and discovering security-interest and insurance fraud. These amendments
concern the requirements for States electing to participate in VIS. The
changes improve the integrity and uniformity of the system and reflect
recent statutory changes.

DATES: This final rule is effective April 19, 2001.

[[Page 15626]]

ADDRESSES: Comments and material received from the public, as well as
documents mentioned in this preamble as being available in the docket,
are part of docket USCG-1999-6420 and are available for inspection or
copying at the Docket Management Facility, U.S. Department of
Transportation, room PL-401, 400 Seventh Street SW., Washington, DC,
between 9 a.m. and 5 p.m., Monday through Friday, except Federal
holidays. You may also find this docket on the Internet at http://
dms.dot.gov.

FOR FURTHER INFORMATION CONTACT: For questions on this rule, call LCDR
Nancy Goodridge, Office of Information Resources, Coast Guard,
telephone 202-267-0254, electronic mail NGoodridge@comdt.uscg.mil. For
questions on viewing or submitting material to the docket, call Dorothy
Beard, Chief, Dockets, Department of Transportation, telephone 202-366-
9329.

SUPPLEMENTARY INFORMATION:

Regulatory History

The following table outlines the regulatory history of this
rulemaking project:

----------------------------------------------------------------------------------------------------------------
Date
Document type Federal Register cite published Comments
----------------------------------------------------------------------------------------------------------------
Advance Notice of Proposed Rulemaking.. 54 FR 38358 9/15/1989 Requested comments and
information on
establishing a Vessel
Identification System
(VIS).
Notice of Proposed Rulemaking.......... 58 FR 51920 10/5/1993 Proposed requirements for
States electing to
participate in VIS, as
required by statute.
Interim Final Rule..................... 60 FR 20310 4/25/1995 Established the
requirements for
participating in VIS;
became effective 4/24/
1996, with the exception
of 33 CFR part 187,
subpart D.
Re-opening of comment period and notice 60 FR 53727 10/17/1995 Reopened the comment
of public hearing. period for the Interim
Final Rule and scheduled
two public hearings.
Change in effective date............... 61 FR 6943 2/23/1996 Delayed the effective date
of 33 CFR part 187
subpart D until 4/24/
1998.
Re-opening of comment period........... 62 FR 54385 10/20/1997 Reopened the comment
period for the Interim
Final Rule (60 FR 20310).
Change in effective date............... 63 FR 19657 4/21/1998 Delayed the effective date
of 33 CFR part 187
subpart D until 4/24/
1999.
Change in effective date............... 64 FR 19039 4/19/1999 Delayed the effective date
of 33 CFR part 187
subpart D until 10/24/
1999.
Final Rule (removing subpart D)........ 64 FR 56965 10/22/1999 Removed 33 CFR part 187
subpart D, which never
went into effect.
Supplemental Notice of Proposed 65 FR 7925 02/16/2000 Revised the proposed
Rulemaking. requirements for States
electing to participate
in VIS, as required by
statute.
----------------------------------------------------------------------------------------------------------------

Background and Purpose

The Secretary of Transportation is required to establish a Vessel
Identification System (VIS) (46 U.S.C. 12501). VIS is a nationwide
system for collecting information on vessels and vessel owners and
other information that will assist law enforcement officials in their
investigations of stolen vessels or other crimes, such as fraud. It
benefits consumers, lenders, insurers, the marine industry, and
national boating organizations by increasing the probability of
recovering stolen vessels and by decreasing the probability of a person
unknowingly purchasing a vessel that is stolen or that has a lien or
other claim against it. In turn, VIS should decrease the probability of
theft. The responsibility for establishing VIS was delegated by the
Secretary of Transportation to the Coast Guard (49 CFR 1.46).
This Final Rule concerns the Coast Guard's regulations in 33 CFR
part 187 (Vessel Identification System), which--
(1) Establish minimum requirements for States electing to
participate in VIS;
(2) Prescribe guidelines for State vessel titling systems; and
(3) Explain how States may obtain certification of compliance with
the vessel titling system guidelines for the purpose of conferring
preferred status under 46 U.S.C. 31322(d) on mortgages, instruments, or
agreements for State-titled vessels.
State participation in VIS is entirely voluntary; however, to
participate, States must comply with certain requirements to ensure the
integrity and uniformity of the information provided to VIS.
Most of the information to be included in VIS is already collected
by States that number vessels under 33 CFR part 174. This rule amends
the requirements in 33 CFR part 187 for States electing to participate
in VIS.
This rule also creates a new 33 CFR part 187, subpart D, Guidelines
for State Vessel Titling Systems, and clarifies the procedures for
obtaining certification of compliance with those guidelines. Under 46
U.S.C. 31322(d)(1), a perfected mortgage covering the whole of a vessel
titled in a State that participates in VIS and has a certified vessel
titling system will be deemed to be a preferred mortgage. Compliance
with the State titling guidelines and requests for certification are
entirely voluntary by a State.

Discussion of Comments and Changes to the Proposed Rule

We received a total of fifteen comments to this rulemaking. In the
following paragraphs, the Coast Guard discusses the comments received
and explains any changes made to the regulations. The Coast Guard first
discusses general comments, and secondly discusses comments regarding
specific sections of the regulations. A significant number of the
changes are the result of comments and recommendations developed
jointly by the primary stakeholders in VIS. These stakeholders include
representatives of State numbering and titling agencies, the marine
lending industry, and the maritime law community.

General Comments

Many of these comments were in response to our proposed changes to
the Standard Numbering System (SNS) requirements in 33 CFR part 174.
Several commentors believed that the changes to the SNS were more
costly than we originally estimated and would potentially impose
additional information collection requirements.

[[Page 15627]]

The Coast Guard agrees that the issues relating to the SNS should
be studied further, prior to making any permanent changes to the
regulations in 33 CFR part 174. We have therefore removed this section
from the rulemaking and will address those comments in a separate
rulemaking. We believe that while VIS is dependent upon the SNS,
changes to the SNS can be developed subsequent to this rulemaking
without a negative effect on VIS. The comments received regarding the
SNS and changes proposed to 33 CFR part 174 will be taken into account
and addressed in the SNS rulemaking.
We additionally received several comments regarding VIS and the
changes proposed in 33 CFR part 187. All comments received throughout
the course of this project were considered in the development of this
Final Rule. The issues raised by the comments, and the sections that
have been revised or added since the publication of the SNPRM, are
discussed.
One comment suggested that the use and acceptance of electronic
titles and signatures be considered for the future with VIS.
The Coast Guard believes that the use and acceptance of electronic
titles and electronic signatures is beyond the scope of this
rulemaking. However, the Coast Guard is committed to utilizing new
technology to improve VIS and will consider electronic titles and
electronic signatures in any future revisions.
One comment cautioned that there will be redundancy of data created
between State databases, and the Coast Guard's database. The comment
asked--
Which agency would be responsible for contacting boat
owners with problem certificates of documentation and State titles?
What will happen to the bank's ship mortgages and/or State
liens?
Who will bear the expense to correct the problems?
VIS will make it easier to detect redundancy across the States'
databases. To assist in detecting redundancy, VIS will automatically
contact applicable States whenever any redundant data has been
detected. This will only happen, however, after a State has submitted
the data to VIS. The Coast Guard recommends that States check VIS prior
to the issuance of documents to ensure the vessel is not registered in
another State and prevent the problems that redundancy can cause. In
regards to responsibility, the agency that issues the documentation
will continue to be responsible for contacting vessel owners and
bearing any expenses incurred with any problems.
The plan to provide for a consolidated builder's certification and
certificate of origin is one of the subjects in another rulemaking
project. The docket number for that project is USCG 1998-4784. We
anticipate that the availability of a single document acceptable to the
States for numbering and titling and to the Coast Guard for vessel
documentation will encourage manufacturers to use only that document.
However, the Coast Guard cautions the commenter that there is no
Federal authority to mandate a specific form for the COO. Only the
individual States may determine what will be acceptable in their
systems.

Procedures for Certification of Compliance With Guidelines for State
Vessel Titling Systems Section (Sec. 187.9)

One comment said that requiring HINs for all recreational vessels
seems excessive. A review of the recreational vessels with a
Certificate of Number in Connecticut indicates approximately 27,000
vessels have HINs. Recreational vessels constructed before 1972 do not
possess a HIN. The State is able to process about 200 HINs annually.
The need to process 27,000 is not possible. Therefore, we suggest that
only vessels constructed on or after 1972 be required to have a HIN.
The goal is to eventually have a valid HIN on every numbered vessel
in the United States without regard to when it may have been built. The
Coast Guard agrees that it is not reasonable to expect States to
immediately issue HINs to all vessels that currently do not have valid
ones. The requirement for a State to assign a HIN to a vessel that does
not have a valid one applies only if the vessel is transferred to a new
owner (sold within State) or moved into a new State of principal
operation. In the meantime, section 187.9(b) provides that the State
number or Coast Guard documentation number will be used as the vessel
identification number in VIS.
One comment stated there was an issue regarding the resolution of
the unique vessel identification number. The National Association of
State Boating Law Administrators (NASBLA), and the International
Association of Marine Investigators (IAMI) have both gone on record in
support of a 17-digit Hull Identification Number (HIN). The rulemaking
project to establish that number has dragged on since 1992. The Comment
asked--
What is the Coast Guard's position on the number;
What does the Coast Guard want; and
When will the Coast Guard make a final decision?
While the Coast Guard recognizes that the issues are related, the
makeup of the HIN is outside the scope of this project. Because of
controversy and conflict there is no consensus on the format for an
expanded HIN and the Coast Guard lacks sufficient data to demonstrate
that the benefits clearly outweigh the costs and burdens, particularly
for small entities and builders of high volume, low cost boats.
Therefore, the proposal to expand the HIN format was withdrawn on June
29, 2000 (65 FR 40069) and a study was begun to gather data on costs
and benefits. We will review the results of the study and decide
whether to issue a new regulatory project.

Information To Identify a Vessel Owner (Sec. 187.101)

One comment said that this section and Sec. 187.103 would require
the redesign of Certificate of Number and Certificate of Decal
applications. This process is complicated and will take several years.
Another comment stated that building additional computer storage
capacity, and extensive programming changes would be needed. To build
additional computer storage capacity as well as implement extensive
programming changes will also take time.
The Coast Guard understands that some changes will need to be made,
however, we reiterate that participation in VIS is voluntary. The SNS
Rulemaking will address this further with its proposal to give States
four years to change applicable Certificates and forms. This will
reduce costs and allow any new forms to be redesigned and purchased as
supplies of the old forms are depleted.
One comment stated that the regulation should make clear that the
information a State must collect to identify a vessel owner in
Sec. 187.101 and the information to identify a vessel in Sec. 187.103
must be made available to VIS as is done in Sec. 187.105.
We agree and have added language to those sections, as well as
Sec. 187.107, to make clear that this information must be made
available to VIS.
Three comments discussed the question of what information should be
made available publicly. Two comments said there should be a charge for
this information. One comment proposed the addition of two new sections
to address this issue.
The Coast Guard will use these comments in a future project when we
establish what exactly will be released, to whom, how it will be
released, and how much it will cost.

[[Page 15628]]

One comment stated that it would be expensive for them to change
their system to collect and store residential address information for
an owner and each lien holder and that mailing address information
should be sufficient.
The Coast Guard understands that systems will require some change,
however the residential address information is required for law
enforcement purposes.
One comment stated that using the Social Security Number (SSN) or
Individual Taxpayer Identification Number (ITIN), as unique vessel
owner identifiers, would require clear Federal and State authority.
States have the option to provide another unique owner identifier
if they are not able, under State law, to collect the SSN or ITIN. The
ITIN should not be a Privacy Act issue for corporate owners.

Information To Identify a Vessel (Sec. 187.103)

One comment suggested that the Coast Guard develop a realistic and
uniform definition for the term ``charter boat'' as it relates to the
needs of the National Marine Fisheries Service (NMFS).
The Coast Guard agrees. According to the Magnuson-Stevens Fishery
Conservation and Management Act (16 U.S.C. 1802), ``charter fishing''
is defined as ``fishing from a vessel carrying a passenger for hire (as
defined in section 2101(21a) of Title 46 who is engaged in recreational
fishing.'' The Coast Guard will work closely with stakeholders to
develop clear guidance defining the categories and commercial
activities identified in VIS.
Another comment stated that the original proposal from NMFS would
require several changes to State registration systems. This is
unacceptable because it would cost too much.
The only change that is being implemented at the request of NMFS is
the addition of ``charter fishing'' as a category of primary use. Other
data requests from NMFS were outside the scope of this rulemaking.
One comment stated that they use the term ``homemade'' to
distinguish between privately constructed vessels from commercially
constructed vessels. The commentor requested that they continue to have
the ability to use this term.
There is no regulation that defines terms to be used in the
manufacture/make field, therefore the term ``homemade'' is an
acceptable term to use.

Information on Titled Vessels (Sec. 187.105)

One comment recommended requiring that a participating State
collect and make available to VIS information concerning the discharge
of a security interest or the surrender of a certificate of title.
This issue was discussed in previous notices. Again, we disagree
because it would impose an additional burden on the States.

Information To Assist Law Enforcement Officials (Sec. 187.107)

One comment asked since their respective State does not require
non-mechanical vessels to be registered, will this information be
required in VIS? The Coast Guard understands that all vessels may not
be registered in a State. Therefore if a vessel is not registered, it
does not need to be reported in VIS.
One comment stated that it was understood that much of the
information listed in Sec. 187.107(b) is noted in the police report,
and could be available by requesting it from the reporting enforcement
agency.
This information is strictly optional and not required to be
reported to VIS.

Participating State Requirements (Sec. 187.201)

One comment stated that a reference was made to States utilizing
microfiche or microfilm or other electronic storage to retain
information. However, this is limited to a number of years. The States'
data storage cannot compare to what is retained by the Coast Guard, in
detail and in length of time. The life of a boat is many more years
than most State storage systems. The lack of this information being
available greatly jeopardizes the history of a boat. VIS should
accommodate keeping essential boat information and not depend on States
for this. Another comment also expressed concern about the retention of
information for a history of transactions involving a vessel.
We believe there is some confusion as to exactly what information
VIS will archive. VIS will archive information on a particular vessel
only if the vessel's registration has been inactive for ten years. And
archived information will be retained for an additional 50 years. Past
transactions, including change of vessel ownership as well as change of
State of registration, will be recorded and stored with a particular
vessel to track and build its history. The reference to microfiche and
microfilm in Part 187.201(d) refers specifically to certificates and
other evidence that establish the accuracy of the information, not the
information itself.
One comment stated that during the months of February, March, and
April hundreds of vessel registrations with changes arrive daily. The
DMV will not be able to provide to VIS changes in registration
information during these three months.
State personnel will process vessel registrations just as they
currently do in the normal course of business. The daily summary of
registration changes will be generated automatically by the computer
program that is developed when a State initially elects to participate
in VIS. Personnel processing daily transactions, require no additional
effort. If a State falls behind in processing transactions, that would
not affect the viability of VIS.

Dealer and Manufacturer Provisions (Sec. 187.307)

Two comments stated that States were concerned with whether dealers
and manufacturers would support the change to regulate boat dealers.
This requirement applies only to States that choose to seek
certification to obtain preferred mortgage status for State-titled
vessels. The principal stakeholders in this rulemaking process
recommended application of this regulation and we agree. The Coast
Guard will consider an amendment if, at a later date, it is determined
that the State restrictions on boat dealers and manufacturers
participation can be deleted without adversely impacting the
effectiveness of VIS.

Surrender of Title for Purposes of Documentation (Sec. 187.315)

One comment stated that in Subpart D of this section, the
amendments included in the Coast Guard Authorization Act of 1998
clearly state that Federal statute now prohibits a vessel from being
both documented by the Coast Guard and titled by a State (46 U.S.C.
12124). In the section on Federalism, this Federal Law is referred to
concluding that States should consider amending their laws and
regulations on this issue. The comment asked whether a State would be
accepted into VIS if they do not conform to this Federal law.
The answer is no. At the present time there are several States
which require titling of documented vessels. Since those laws are in
conflict with Federal law, the Coast Guard strongly recommends that
States amend their laws and regulations on this issue to alleviate the
conflict. The National Vessel Documentation Center is undertaking a
separate rulemaking project to provide for the surrender of

[[Page 15629]]

State titles when a vessel is documented under Federal law.

Procedures for Perfection of Security Interests (Sec. 187.323)

We received two comments pointing out that States employ different
procedures for security interest perfection on State boat titles. Some
States deem the perfection to have occurred when the State boat title
application and necessary fees are delivered to the proper State filing
office; other States deem legal perfection to occur when the secured
party is actually noted on the certificate of title. A State may make
its own choice as to determination of the date and time of perfection.
One comment suggested that this issue could be clarified by replacing
the word ``Delivery'' at the beginning of Sec. 187.323(a)(1) with the
word ``Submission.''
We agree and have made the recommended change in both
Sec. 187.323(a)(1) and in Sec. 187.323(a)(4).

Regulatory Evaluation

This rule is not a ``significant regulatory action'' under section
3(f) of Executive Order 12866 and does not require an assessment of
potential costs and benefits under 6(a)(3) of that Order. The Office of
Management and Budget under that Order has not reviewed it. It is not
``significant'' under the regulatory policies and procedures of the
Department of Transportation (DOT) (44 FR 11040, February 26, 1979).
We expect the economic impact of this proposed rule to be so
minimal that a full Regulatory Evaluation under paragraph 10e of the
regulatory policies and procedures of DOT is unnecessary. This rule
imposes zero mandatory costs. For States that choose to participate in
VIS, we expect an average one-time cost of $55,000 per State and an
average recurring cost (for correcting inaccurate data entries) equal
to $0.75 times 2 percent of the number of annual registration changes
per State.

I. Costs

This rule does not impose mandatory costs on States. A State may
elect to participate in VIS but is not compelled to do so.
Participation is entirely voluntary. In our estimation of hour and cost
burdens, we assumed a 100% participation rate in VIS by 2009.
The total cost of this rulemaking to a State participating in VIS
is the sum of the one-time costs and recurring costs. Over the 10-year
period of analysis, the present-value total cost of this rule to States
that elect to participate in VIS is estimated to be $2,917,450.
(a) One-Time Costs
The only one-time cost is the cost of developing the VIS/State
database interface and update programming at the State level. We
estimate the average cost of developing VIS at the State level would be
$55,000 per participant. Assuming a 100% participation rate by the year
2009, we estimate that the total one-time cost of developing VIS, in
present-value terms, would be $2,366,574 in 1999 dollars.
(b) Recurring Costs
There are two recurring costs. The first is the cost to produce a
daily summary update of registration changes, which is transmitted to
VIS. The second is the cost of correcting data entry errors of
registration changes.
The daily summary update of registration changes will be generated
automatically by the computer program that is developed when a State
initially elects to participate in VIS. Consequently, the Coast Guard
estimates that the cost to a State of producing approximately 250
annual summary updates would be zero. If a State improperly enters the
data for a change of registration, an error report is generated from
VIS. A State that receives an error report will be required to correct
the data entry. We estimate 2 percent of a State's registration changes
will be improperly entered and generate error reports. In most cases,
we expect the error will be limited to a particular field in the data
set, and its correction will be quick.
We estimate it would cost an average of $0.75 to correct a data
entry (assuming it takes an average of 3 minutes or 0.05 hours at an
average of $15 per hour to correct an entry). The corrected data entry
will then be automatically included in that day's summary update. So,
if a State has an average of 100,000 registration changes per year, we
would expect an average of 2,000 data entry mistakes and a recurring
cost of $1,500 per year (100,000 x 0.02 x $0.75 = $1,500).
The present-value total recurring cost of this rule to States is
estimated to be $550,876. When added to the estimated present-value
total start-up cost to States of $2,366,574, the present-value total
cost of this rule to States over the 10-year period of analysis is
$2,917,450 ($550,876 + $2,366,574 = $2,917,450).
The present-value total cost of this rule to States and to the
Federal government to support and maintain VIS is estimated to be
$8,688,439 in 1999 dollars ($2,917,450 to States and $5,770,989 to the
Federal government).

II. Benefits

The primary benefits of VIS will come from its ability to serve as
a tracking device for vessels, with the vessel identifier serving much
like the Vehicle Identification Number found in automobiles. As a
tracking device, the benefits of VIS will be in the--
(1) Improved odds of recovering a stolen or missing vessel, which
benefits boat owners and insurers, and local and State law enforcement
agencies;
(2) Decreased odds of unknowingly purchasing a stolen vessel, which
can be a financial disaster if the rightful owner shows up to claim it;
and
(3) Decreased odds of unknowingly purchasing a vessel that has a
lien, unpaid taxes, or other claim(s) lodged against it, which can
become the responsibility of the new owner.
VIS establishes penalties for those persons who--
(1) Intentionally provide false information to the issuing
authority regarding the identification of a vessel; or
(2) Tamper with, remove, or falsify a unique vessel identification
number.
Combining those penalties with its feature as a tracking device, a
secondary benefit of VIS will be the reduction in theft of vessels. A
third benefit of VIS will be the preferred mortgage status of a
perfected mortgage covering the whole of a vessel titled in a State
that participates in VIS and has a certified vessel titling system.

Collection of Information

This rule calls for a collection of information under the Paperwork
Reduction Act of 1995 (44 U.S.C. 3501-3520). We submitted a copy of the
rule, as required by 44 U.S.C. 3507(d), to the Office of Management and
Budget (OMB) for its review of the collection of information. OMB
approved the collection. The section numbers are Secs. 187.11, 187.13,
187.101, 187.103, 187.105, 187.107, 187.201, and 187.301 and the
corresponding approval number is OMB Control Number 2115-0607. You need
not respond to a collection of information unless it displays a
currently valid control number from OMB.

Small Entities

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we
considered whether this rule would have a significant economic impact
on a substantial number of small entities. The term ``small entities''
comprises small businesses, not-for-profit organizations that are
independently owned and operated and are not

[[Page 15630]]

dominant in their fields, and governmental jurisdictions with
populations of less than 50,000.
This rule affects U.S. States. It imposes zero mandatory costs.
According to the U.S. Bureau of the Census, none of the States eligible
to participate in VIS has a population less than 50,000. Thus, there
are no small entities affected and no impact upon small entities.
Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that
this final rule will not have a significant economic impact on a
substantial number of small entities.

Assistance for Small Entities

Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we offered to assist small
entities in understanding the rule so that they can better evaluate its
effects on them and participate in the rulemaking.
Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247).

Federalism

We have analyzed this rule under Executive Order 13132 and have
determined that it does not have federalism implications to warrant the
preparation of a Federalism Assessment under that Order.
This rule is not expected to infringe upon the rights of States to
regulate, or preempt existing State regulations. State participation is
entirely voluntary. However, once electing to participate, a State must
comply with the requirements to ensure integrity and uniformity of
information in both the Standard Numbering System and VIS. Likewise,
requesting certification that a State vessel titling system complies
with the guidelines is also voluntary. Such certification, for
participating States, confers preferred status on mortgages covering
the whole of vessels titled in that State.
However, Federal law (46 U.S.C. 12124) prohibits a vessel from
being both documented by the Coast Guard and titled by a State. This
prohibition applies to all State-titled vessels, whether or not the
title-issuing State participates in VIS or follows the titling
guidelines. States that require documented vessels to be titled should
consider amending their laws and regulations on this issue.

Unfunded Mandates Reform Act

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their regulatory
actions not specifically required by law. In particular, the Act
addresses actions that may result in the expenditure by a State, local,
or tribal government, in the aggregate, or by the private sector of
$100,000,000 or more in any one year. Though this rule will not result
in such expenditure, we do discuss the effects of this rule elsewhere
in this preamble.

Taking of Private Property

This rule will not effect a taking of private property or otherwise
have taking implications under E.O. 12630, Governmental Actions and
Interference with Constitutionally Protected Property Rights.

Civil Justice Reform

This rule meets applicable standards in sections 3(a) and 3(b)(2)
of Executive Order 12988, Civil Justice Reform, to minimize litigation,
eliminate ambiguity, and reduce burden.

Protection of Children

We have analyzed this rule under Executive Order 13045, Protection
of Children from Environmental Health Risks and Safety Risks. This rule
is not an economically significant rule and does not concern an
environmental risk to health or risk to safety that may
disproportionately affect children.

Environment

We considered the environmental impact of this rule and concluded
that, under figure 2-1, paragraph (34) of Commandant Instruction
M16475.1C, this rule is categorically excluded from further
environmental documentation. This rule establishes a nationwide
information system for identifying vessels and vessel owners, and
guidelines for State vessel titling systems. This action clearly will
have no environmental consequences. A ``Categorical Exclusion
Determination'' is available in the docket where indicated under
ADDRESSES.

List of Subjects in 33 CFR Part 187

Administrative practice and procedure, Marine safety, Reporting and
recordkeeping requirements.

For the reasons discussed in the preamble, the Coast Guard revises
33 CFR part 187 to read as follows:

PART 187--VESSEL IDENTIFICATION SYSTEM

Subpart A--General
Sec.
187.1 Which States are affected by this part?
187.3 What vessels are affected by this part?
187.5 What are the purposes of this part?
187.7 What are the definitions of terms used in this part?
187.9 What is a vessel identifier and how is one assigned?
187.11 What are the procedures to participate in VIS?
187.13 What are the procedures for obtaining certification of
compliance with guidelines for State vessel titling systems?
187.15 When is a mortgage a preferred mortgage?
Subpart B--Information To Be Collected by Participating States
187.101 What information must be collected to identify a vessel
owner?
187.103 What information must be collected to identify a vessel?
187.105 What information on titled vessels must be collected and
what may be collected?
187.107 What information must be made available to assist law
enforcement officials and what information may be made available?
Subpart C--Requirements for Participating in VIS
187.201 What are the compliance requirements for a participating
State?
187.203 What are the voluntary provisions for a participating
State?
Subpart D--Guidelines for State Vessel Titling Systems
187.301 What are the eligibility requirements for certification of
a State titling system to confer preferred mortgage status?
187.303 What terms must a State define?
187.304 What vessels must be titled?
187.305 What are the requirements for applying for a title?
187.307 What are dealer and manufacturer provisions?
187.309 What are the requirements for transfer of title?
187.311 What are the application requirements for a certificate of
title because of a transfer by operation of law or order of court?
187.313 Must a State honor a prior State title, Coast Guard
documentation, and foreign registry?
187.315 What happens when a title is surrendered for the purposes
of documentation?
187.317 What information must be on a certificate of title?
187.319 What are the requirements for applying for a redundant
title?
187.321 What are the hull identification number (HIN) provisions?

[[Page 15631]]

187.323 What are the procedures for perfection of security
interests?
187.325 Is a State required to specify procedures for the
assignment of a security interest?
187.327 What are a State's responsibilities concerning a discharge
of security interests?
187.329 Who prescribes and provides the forms to be used?
187.331 What information is to be retained by a State?

Appendix A to Part 187--Participating Authorities

Appendix B To Part 187--Participating and Certified Vessel Titling
Authorities

Authority: 46 U.S.C. 2103; 49 CFR 1.46.

Subpart A--General

Sec. 187.1 Which States are affected by this part?

States electing to participate in the Vessel Identification System
(VIS) are affected by this part.

Sec. 187.3 What vessels are affected by this part?

Only vessels numbered or titled by a participating State are
affected by this part. Vessels documented under 46 U.S.C. chapter 121
and 46 CFR parts 67 and 68 are not affected.

Sec. 187.5 What are the purposes of this part?

The purposes of this part are to--
(a) Establish minimum requirements for States electing to
participate in VIS;
(b) Prescribe guidelines for State vessel titling systems; and
(c) Explain how to obtain certification of compliance with State
guidelines for vessel titling systems for the purpose of conferring
preferred status on mortgages, instruments, or agreements under 46
U.S.C. 31322(d).

Sec. 187.7 What are the definitions of terms used in this part?

As used in this part--
Approved Numbering System means a numbering system approved by the
Secretary of Transportation under 46 U.S.C. Chapter 123.
Certificate of Documentation means the certificate issued by the
Coast Guard for a documented vessel under 46 U.S.C. 12103 (Form CG-
1270).
Certificate of Origin or COO means a document establishing the
initial chain of ownership, such as a manufacturer's certificate of
origin (MCO) or statement of origin (MSO), an importer's certificate of
origin (ICO) or statement of origin (ISO), or a builder's certification
(Form CG-1261; see 46 CFR part 67).
Certificate of Ownership means the Certificate of Ownership issued
by the Coast Guard under 46 CFR part 67 (Form CG-1330).
Commandant means the Commandant of the United States Coast Guard.
Dealer means any person who engages wholly or in part in the
business of buying, selling, or exchanging new or used vessels, or
both, either outright or on conditional sale, bailment, lease, chattel
mortgage or otherwise. A dealer must have an established place of
business for the sale, trade, and display of such vessels.
Documented vessel means a vessel documented under 46 U.S.C. chapter
121.
Hull Identification Number or HIN means the number assigned to a
vessel under subpart C of 33 CFR part 181.
Issuing authority means either a State that has an approved
numbering system or the Coast Guard in a State that does not have an
approved numbering system.
Manufacturer means any person engaged in the business of
manufacturing or importing new vessels for the purpose of sale or
trade.
Owner means a person, other than a secured party, having property
rights in, or title to, a vessel. ``Owner'' includes a person entitled
to use or possess a vessel subject to a security interest in another
person, but does not include a lessee under a lease not intended as
security.
Participating State means a State certified by the Commandant as
meeting the requirements of subpart C of this part. States meeting this
definition will be listed in Appendix A to this part.
Person means an individual, firm, partnership, corporation,
company, association, joint-stock association, or governmental entity
and includes a trustee, receiver, assignee, or similar representative
of any of them.
Secured party means a lender, seller, or other person in whose
favor there is a security interest under applicable law.
Security interest means an interest that is reserved or created by
an agreement under applicable law and that secures payment or
performance of an obligation.
State means a State of the United States, the District of Columbia,
American Samoa, Guam, Northern Mariana Islands, Puerto Rico, U.S.
Virgin Islands, and any other territory or possession of the United
States.
Titled vessel means a vessel titled by a State.
Titling authority means a State whose vessel titling system has
been certified by the Commandant under subpart D of this part. Titling
authorities participating in VIS will be listed in Appendix B to this
part.
Vessel includes every description of watercraft, other than a
seaplane on the water, used or capable of being used as a means of
transportation on water.
Vessel Identification System or VIS means a system for collecting
information on vessels and vessel ownership as required by 46 U.S.C.
12501.

Sec. 187.9 What is a vessel identifier and how is one assigned?

(a) The vessel identifier for a vessel having a valid HIN is the
HIN.
(b) If a vessel does not have a valid HIN, a vessel identifier is
assigned under the following table:

Table 187.9(b)--Vessel Identifier Assignments
------------------------------------------------------------------------
And does not have a Then the vessel
If the vessel is: valid HIN: identifier is:
------------------------------------------------------------------------
(1) Documented.............. .................... The official number
assigned by the
Coast Guard under
46 CFR part 67.
(2) Documented.............. And is transferred The HIN assigned by
to a new owner. the Coast Guard.
(3) Undocumented............ And must be numbered The number issued on
under 33 CFR parts a certificate of
173 and 174. number by the
issuing authority
of the State of
principal
operation, provided
the number will not
be used in the
future to identify
a different vessel.
(4) Undocumented............ And is transferred The HIN assigned by
to a new owner. the issuing
authority of the
State of principal
operation.
(5) Undocumented............ And the vessel is The HIN assigned by
required to be the issuing
numbered or titled authority of the
in a new State of State of principal
principal operation. operation.
------------------------------------------------------------------------

[[Page 15632]]

Sec. 187.11 What are the procedures to participate in VIS?

(a) A State must submit a written request to the Commandant (G-OPB)
certifying that it will comply with the VIS participation requirements
in subpart C of this part.
(b) The Commandant will review the request and determine if the
State is complying with the VIS participation requirements. If so, the
Commandant will certify compliance by listing the State in Appendix A
to this part.
(c) Appendix A to this part will list those States certified by the
Commandant to participate in VIS. When the Commandant determines that a
State is not complying with the participation requirements, it will
lose its certification and will be deleted from Appendix A to this
part.

Sec. 187.13 What are the procedures for obtaining certification of
compliance with guidelines for State vessel titling systems?

(a) A State must submit a written request to the Commandant (G-
OPB). The request must include a copy of the State's titling laws,
regulations and administrative procedures, and certify that the State
will comply with the VIS participation requirements in subpart C of
this part.
(b) The Commandant will review the request and determine if the
State is complying with the Guidelines for State Vessel Titling Systems
in subpart D of this part. If the State is complying with the
guidelines, the Commandant will certify compliance and list the State
in Appendix B to this part.
(c) Appendix B to this part will list States certified by the
Commandant. When the Commandant determines that a State is not
complying with the vessel titling guidelines, it will lose its
certification and be deleted from Appendix B to this part.

Sec. 187.15 When is a mortgage a preferred mortgage?

A mortgage, instrument, or agreement granting a security interest
perfected under State law covering the whole of a vessel titled under
the law of a participating State is a preferred mortgage if the State
is certified under Sec. 187.13.

Subpart B--Information to be Collected by Participating States

Sec. 187.101 What information must be collected to identify a vessel
owner?

(a) A participating State must collect the following information
for a vessel it has numbered or titled when an individual owns the
vessel and make it available to VIS:
(1) Names of all owners.
(2) Principal residence of one owner.
(3) Mailing Address, if different from the address in paragraph
(a)(2) of this section.
(4) One of the following unique identifiers for each owner:
(i) Social Security Number (SSN) or Individual Taxpayer
Identification Number (ITIN).
(ii) If the SSN or ITIN is not available, birth date and driver's
license number.
(iii) If the SSN, ITIN, and driver's license number are not
available, birth date and other unique identifier prescribed by the
State.
(b) A participating State must collect the following information
for a vessel that it has numbered or titled when the vessel's owner is
not an individual, but a business or other type of organization:
(1) Names of all businesses or organizations that own the vessel.
(2) Principal address of one business or organization.
(3) Mailing address, if different from the address in paragraph
(b)(2) of this section.
(4) Taxpayer Identification Number (TIN) for the principal business
or organization.
(5) If the TIN for the principal business or organization is not
available, one of the following unique identifiers for a corporate
officer, a partner, or the individual who signed the application for
numbering:
(i) Social Security Number (SSN) or Individual Taxpayer
Identification Number (ITIN).
(ii) If the SSN or ITIN is not available, birth date and driver's
license number.
(iii) If the SSN, ITIN, and driver's license number are not
available, birth date and other unique identifier prescribed by the
State.

Sec. 187.103 What information must be collected to identify a vessel?

A participating State must collect the following information on a
vessel it has numbered or titled and make it available to VIS:
(a) Manufacturer's hull identification number (HIN), if any.
(b) Official number, if any, assigned by the Coast Guard or its
predecessor.
(c) Number on certificate number assigned by the issuing authority
of the State.
(d) Expiration date of certificate of number.
(e) Number previously issued by an issuing authority.
(f) Name of manufacturer, builder, or make.
(g) Model year, manufacture year, or year built.
(h) Overall length.
(i) Vessel type. Authorized terms are ``open motorboat'', ``cabin
motorboat'', ``auxiliary sail'', ``sail only'', ``personal
watercraft'', ``pontoon'', ``houseboat'', ``rowboat'', ``canoe/kayak'',
or ``other''.
(j) Hull material. Authorized terms are ``wood'', ``aluminum'',
``steel'', ``fiberglass'', ``rigid hull inflatable'', ``rubber/vinyl/
canvas'', or ``other''.
(k) Propulsion type. Authorized terms are ``propeller'', ``sail'',
``water jet'', ``air thrust'', or ``manual''.
(l) Engine drive type. Authorized terms are ``outboard'',
``inboard'', or ``inboard/stern drive''.
(m) Fuel. Authorized terms are ``gasoline'', ``diesel'', or
``electric''.
(n) Primary use. Authorized terms are ``pleasure'', ``rent or
lease'', ``dealer or manufacturer demonstration'', ``charter fishing'',
``commercial fishing'', ``commercial passenger carrying'', or ``other
commercial operation''.

Sec. 187.105 What information on titled vessels must be collected and
what may be collected?

(a) A participating State must collect the following information on
a vessel it has titled and make it available to VIS:
(1) Information required under Sec. 187.103.
(2) Title number.
(3) Issuance date of the most recently issued title or redundant.
(4) Where evidence may be found on the security interest or lien
against the vessel.
(5) Name of each secured party.
(6) Address (city and State) of each secured party.
(b) A participating State may collect the following information on
a vessel it has titled and make it available to VIS:
(1) Information concerning the discharge of the security interest.
(2) Information concerning the surrender of the certificate of
title.

Sec. 187.107 What information must be made available to assist law
enforcement officials and what information may be made available?

(a) A participating State must make the following information
available to VIS for use by law enforcement officials:
(1) Vessel identifier(s), as required by Sec. 187.9.
(2) Notice of law enforcement status. Authorized terms are
``lost'', ``stolen'', ``destroyed'', ``abandoned'', or ``recovered''.
(3) Date of notice of law enforcement status.
(4) Point of contact for the agency or official reporting the
status.
(5) National Crime Information Center code for the reporting agency
or official.
(b) A participating State may make the following information
available to law enforcement officials:
(1) Notice that the vessel is being sought for a law enforcement
purpose

[[Page 15633]]

other than a purpose listed in paragraph (a)(2) of this section.
(2) Location of vessel when reported lost, stolen, destroyed,
abandoned, or recovered.
(3) Vessel insurance policy number.
(4) Name of insurance company.
(5) Address of insurance company.
(6) Mailing address of insurance company, if different from the
address in paragraph (b)(5) of this section.
(7) Telephone number of insurance company.
(8) Date the vessel was recovered.
(9) Location of the vessel when recovered.
(10) Names and telephone numbers of contacts not listed under
paragraph (a)(4) of this section.
(11) Request to be notified if vessel is sighted.
(12) Purpose of sighting notification request.
(13) Date and time vessel last sighted.
(14) Location of vessel when last sighted.

Subpart C--Requirements for Participating in VIS

Sec. 187.201 What are the compliance requirements for a participating
State?

A participating State must comply with the following requirements:
(a) Collect the required information listed in subpart B of this
part and provide that information to VIS under the applicable Coast
Guard-State Memorandum of Agreement.
(b) Obtain specific evidence of ownership, such as the COO or
current certificate of title and/or number, to identify a vessel's
owner.
(c) Retain previously issued evidence of ownership, such as
certificate of number, title, or Certificate of Documentation, and
notify the issuing authority or the Coast Guard by mail or electronic
message.
(d) Retain information identifying the type of evidence used to
establish the accuracy of the information required to be made available
to VIS and make it available to the Commandant upon request.
(e) Update the information required to be made available to VIS by
providing, within 48 hours, a copy of transactions that enter, modify,
or cancel records in the vessel files.

Sec. 187.203 What are the voluntary provisions for a participating
State?

A participating State may--
(a) Provide VIS with the optional information listed in subpart B
of this part;
(b) Make available to VIS updated information provided by the
vessel owner, government agency, or secured party about a vessel that
has been moved to a non-participating State of principal operation; and
(c) Interact with non-participating States to make information
available to, or request information from, VIS concerning a vessel or
nationwide statistics.

Subpart D--Guidelines for State Vessel Titling Systems

Sec. 187.301 What are the eligibility requirements for certification
of a State titling system to confer preferred mortgage status?

The Commandant, under 46 U.S.C. 31322(d)(1)(A) and Sec. 187.13, may
certify a State vessel titling system that meets the requirements of
this subpart as complying with the guidelines for vessel titling
systems. This certification is for the purpose of conferring preferred
mortgage status on a mortgage, instrument, or agreement granting a
security interest perfected under State law, covering the whole of a
vessel titled in that State. The State must also comply with the VIS
participation requirements of Sec. 187.11 and subpart C of this part
and make vessel information it collects available to VIS.

Sec. 187.303 What terms must a State define?

A State must define the terms ``certificate of origin'',
``dealer'', ``documented vessel'', ``issuing authority'',
``manufacturer'', ``owner'', ``person'', ``secured party'', ``security
interest'', ``titling authority'', and ``vessel'' substantially as
defined in Sec. 187.7.

Sec. 187.304 What vessels must be titled?

A State must require that all vessels required to be numbered in
the State under 46 U.S.C. chapter 123 be titled only in that State, if
that State issues titles to that class of vessels.

Sec. 187.305 What are the requirements for applying for a title?

(a) A State must require application for a title within a specified
period of time, not to exceed 60 days, after a vessel required to be
titled is first purchased, ownership is transferred, or there is a
change in vessel data listed on the certificate of title.
(b) A State must require disclosure in its titling application form
of any secured party holding an unsatisfied security interest in the
vessel.
(c) The application must include an entry for identification of the
State or country in which the vessel was last numbered, titled,
documented, or registered under the laws of a foreign country.
(d) A State must require that a COO for a vessel be submitted
together with the application for any new vessel not previously
numbered, titled, documented, or registered under the laws of a foreign
country.
(e) A State must require that the application include a signed
certification that the statements made are true and correct to the best
of the applicant's knowledge, information, and belief, under penalty of
perjury or similar penalties as prescribed by State law.

Sec. 187.307 What are dealer and manufacturer provisions?

A State must include the following provisions applicable to any
dealer or manufacturer building, buying, acquiring, selling, or
transferring a vessel in that State:
(a) Dealers or manufacturers must not be allowed to apply for a
certificate of title for a vessel not required to be numbered. Dealers
or manufacturers owning a new or used vessel primarily used in their
business, held for sale or lease, and required to be numbered may be
permitted or required to apply for a certificate of title for the
vessel. The State may impose other reporting requirements on dealers or
manufacturers.
(b) Dealers or manufacturers transferring a vessel required to be
titled in the name of the dealer or manufacturer must be required to
assign the title to the new owner or, for a new vessel, assign a COO
for a new vessel. Dealers or manufacturers transferring a vessel
permitted to be titled in their name must be required to assign to the
new owner any certificate of title which has been issued and not
surrendered.
(c) Dealers or manufacturers must not be permitted to provide a
redundant COO if VIS contains information concerning the vessel.
(d) Dealers or manufacturers must be permitted to provide a
redundant COO to the vessel owner only upon receipt of information
concerning the original certificate and the circumstances of its loss,
theft, mutilation, or destruction and receipt of any recovered original
COO or remains from the vessel owner. This information must be declared
under penalty of perjury or similar penalties as prescribed by State
law. The term ``REDUNDANT'' must be clearly and permanently marked on
the face of a redundant COO.
(e) Dealers or manufacturers must be required to maintain for at
least 3 years a record of any vessel bought, sold, exchanged, or
received for sale or exchange, and open such records for inspection by
the State.

[[Page 15634]]

Sec. 187.309 What are the requirements for transfer of title?

To complete the sale, assignment, or transfer of a titled vessel, a
State must require that a manufacturer, dealer, or individual must
deliver the vessel's certificate of title to the new owner or new
owner's designee, except for transfers by operation of law or order of
court.

Sec. 187.311 What are the application requirements for a certificate
of title because of a transfer by operation of law or order of court?

A State must require a new owner to apply for a certificate of
title within a specified period of time, not to exceed 60 days, after
ownership of a vessel is transferred by operation of law or order of
court. This application must include an original or authenticated copy
of the legal transfer document.

Sec. 187.313 Must a State honor a prior State title, Coast Guard
documentation, and foreign registry?

(a) A State must honor a title issued by another State as proof of
ownership for transfer or sale of a vessel and for applying for a
certificate of number or title in the new State of principal operation.
(b) A State must honor a Coast Guard-issued Certificate of
Ownership or a Certificate of Deletion as proof of ownership and
deletion from documentation.
(c) A State must honor an authenticated copy of a foreign registry,
or evidence of deletion from the foreign registry, as proof of
ownership and deletion from the foreign registry.

Sec. 187.315 What happens when a title is surrendered for the purposes
of documentation?

A State title is invalid when it is surrendered to the Coast Guard
in exchange for a Certificate of Documentation. Upon notification from
the Coast Guard of the surrender of a title, a State must process the
cancellation of the title.

Sec. 187.317 What information must be on a certificate of title?

(a) A certificate of title must contain the following information
concerning the vessel:
(1) Names of all owners (individuals, businesses, and
organizations).
(2) Address of one individual, business, or organization owning the
vessel.
(3) Title number.
(4) Date of issuance of title.
(5) Vessel identifier under Sec. 187.9.
(6) Name of manufacturer, builder, or make.
(7) Model year, manufacture year, or year built.
(8) Overall length.
(9) Vessel type. Authorized terms are ``open motorboat'', ``cabin
motorboat'', ``auxiliary sail'', ``sail only'', ``personal
watercraft'', ``pontoon'', ``houseboat'', ``rowboat'', ``canoe/kayak'',
or ``other''.
(10) Hull material. Authorized terms are ``wood'', ``aluminum'',
``steel'', ``fiberglass'', ``rigid hull inflatable'', ``rubber/vinyl/
canvas'', or ``other''.
(11) Propulsion type. Authorized terms are ``propeller'', ``sail'',
``water jet'', ``air thrust'', or ``manual''.
(12) Engine drive type. Authorized terms are ``outboard'',
``inboard'', or ``inboard/stern drive''.
(13) Name of each secured party.
(14) Address (city and State) of each secured party.
(15) Recording or perfection date of new security interest and
original recording or perfection date of any security interest
outstanding.
(b) Space must be provided on the title form for assignment of
interests in the vessel, with a signed certification that the
statements made are true and correct to the best of the owner's
knowledge, information, and belief, under penalty of perjury or similar
penalties as prescribed by State law.

Sec. 187.319 What are the requirements for applying for a redundant
title?

(a) A State must require the holder (owner or secured party) of an
original title to apply for a redundant title after the discovery of
the loss, theft, mutilation, or destruction of the original.
(b) The holder must provide information, declared under penalty of
perjury or similar penalties as prescribed by State law, concerning the
original certificate and the circumstances of its loss, theft,
mutilation, or destruction.
(c) The holder must surrender to the State any recovered original
title or remains.
(d) The State must clearly and permanently mark the face of a
redundant certificate of title with the term ``REDUNDANT.''

Sec. 187.321 What are the hull identification number (HIN) provisions?

A State must--
(a) Upon proof of ownership, assign an HIN and require that it be
affixed to a vessel that does not have an HIN at the time of
application for certificate of number or title; and
(b) Prohibit removal or alteration of an HIN without authorization
from the Commandant.

Sec. 187.323 What are the procedures for perfection of security
interests?

(a) A State must specify, at a minimum, the following procedures
for perfection of a security interest in a vessel titled in that State:
(1) Submission of an application for new or amended certificate of
title on which the secured party must be noted.
(2) Surrender of any outstanding certificate of number and any
outstanding title issued by another State.
(3) Surrender of the Certificate of Documentation of any documented
vessel that is to be numbered and titled by the State.
(4) Submission of an authenticated copy of any foreign registry of
the vessel and evidence of deletion from the foreign registry of the
vessel that is to be numbered and titled by the State.
(5) Determination of the date of perfection.
(b) A State must recognize, under 46 U.S.C. 31322(e)(1), that, if a
vessel is covered by a preferred mortgage when an application for a
certificate of title is filed in that State, then the status of the
preferred mortgage covering the vessel is determined by the law of the
jurisdiction in which the vessel is currently titled or documented.
(c) A State must recognize, under 46 U.S.C. 31322(d)(2), that, if a
vessel titled in a State is covered by a preferred mortgage, that
mortgage will continue to be a preferred mortgage even if the vessel is
no longer titled in the State where the mortgage, instrument, or
agreement granting a security interest perfected under State law became
a preferred mortgage.
(d) A State must recognize, under 46 U.S.C. 31322(d)(1), the
preferred status of a mortgage, instrument, or agreement granting a
security interest perfected under State law covering the whole of a
vessel titled in a State after the Commandant has certified that
State's titling system and the State participates in VIS with respect
to the vessel.
(e) The State must provide that the perfection procedures required
to be established under this section do not apply to--
(1) A lien given by statute or rule of law to a supplier of
services or materials for the vessel;
(2) A lien given by statute to the United States, a State, or a
political subdivision thereof;
(3) A lien arising out of an attachment of a vessel;
(4) A security interest in a vessel created by a dealer or
manufacturer who holds the vessel for sale, irrespective of whether the
vessel is titled;

[[Page 15635]]

(5) A security interest claimed in a vessel's proceeds, as defined
in the Uniform Commercial Code in effect in the State, if the security
interest in the vessel did not have to be noted on a vessel's title in
order to be perfected; or
(6) Any vessel for which a certificate of title is not required in
the State.

Sec. 187.325 Is a State required to specify procedures for the
assignment of a security interest?

Yes, a State must specify the procedures that apply to the
assignment of a security interest in a vessel titled in that State.

Sec. 187.327 What are a State's responsibilities concerning a
discharge of security interests?

A State must specify the evidence and information that a secured
party is required to submit regarding discharge of a security interest
and establish procedures for its submission.

Sec. 187.329 Who prescribes and provides the forms to be used?

A State must prescribe and provide the forms needed to comply with
the titling system.

Sec. 187.331 What information is to be retained by a State?

A State must retain the evidence used to establish the accuracy of
the information required for vessel titling purposes and make it
available on request to the Coast Guard, participating States, and law
enforcement authorities.

Appendix A to Part 187--Participating Authorities

The following States comply with the requirements for
participating in VIS:
[Reserved].

Appendix B to Part 187--Participating and Certified Titling Authorities

The following States comply with the requirements for
participating in VIS and have a certified titling system:
[Reserved].

Dated: November 14, 2000.
R.C. North,
Assistant Commandant for Marine Safety and Environmental Protection.
[FR Doc. 01-6906 Filed 3-19-01; 8:45 am]
BILLING CODE 4910-15-P

Notices For
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