[Code of Federal Regulations]
[Title 50, Volume 4]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 50CFR679.41]

[Page 709-713]
 
                    TITLE 50--WILDLIFE AND FISHERIES
 
                         DEPARTMENT OF COMMERCE
 
PART 679--FISHERIES OF THE EXCLUSIVE ECONOMIC ZONE OFF ALASKA--Table of Contents
 
         Subpart D--Individual Fishing Quota Management Measures
 
Sec. 679.41  Transfer of quota shares and IFQ.

    (a) General. (1) Except as provided in paragraph (a)(2) of this 
section, transfer of QS or IFQ means any transaction requiring QS, or 
the use thereof in the form of IFQ, to pass from one person to another, 
permanently or for a fixed period of time.
    (2) Transactions requiring IFQ cards to be issued in the name of a 
vessel master employed by an individual or a corporation are not 
transfers of QS or IFQ.
    (b) Transfer procedure--(1) Application for transfer. An Application 
for Transfer of QS/IFQ (Application for Transfer) must be approved by 
the Regional Administrator before a person may use IFQ to harvest IFQ 
halibut or IFQ sablefish, whether the IFQ was the result of a direct 
transfer or the result of a QS transfer. An Application for Transfer 
will not be approved until the Regional Administrator has reviewed and 
approved the transfer agreement signed by the parties to the 
transaction. The Regional Administrator shall provide an Application for 
Transfer form to any person on request. Persons who submit an 
Application for Transfer to the Regional Administrator for approval will 
receive notification of the Regional Administrator's decision to approve 
or disapprove the Application for Transfer, and, if applicable, the 
reason(s) for disapproval, by mail posted on the date of that decision, 
unless another communication mode is requested on the Application for 
Transfer.
    (2) QS or IFQ accounts. QS or IFQ accounts affected by an 
Application for Transfer approved by the Regional Administrator will 
change on the date of approval. Any necessary IFQ permits will be sent 
with the notification of the Regional Administrator's decision.
    (c) Application for Transfer approval criteria. Except as provided 
in paragraph (f) of this section, an Application for Transfer will not 
be approved until the Regional Administrator has determined that:
    (1) The person applying for transfer received the QS or IFQ to be 
transferred:
    (i) By initial assignment by the Regional Administrator as provided 
in Sec. 679.40(a); or
    (ii) By approved transfer.
    (2) The person applying to receive the QS or IFQ meets the 
requirements of eligibility in paragraph (d) of this section.
    (3) The person applying for transfer and the person applying to 
receive the QS or IFQ have their notarized signatures on the Application 
for Transfer.
    (4) There are no fines, civil penalties, or other payments due and 
owing, or outstanding permit sanctions, resulting from Federal fishery 
violations involving either person.
    (5) The person applying to receive the QS or IFQ currently exists.
    (6) The transfer would not cause the person applying to receive the 
QS or IFQ to exceed the use limits in Sec. 679.42 (e) or (f).
    (7) The transfer would not violate the provisions of paragraph (g) 
of this section.
    (8)(i) The person applying to make or receive the IFQ or QS transfer 
has paid all IFQ fees that have become due as a result of an initial 
administrative determination.
    (ii) The person applying to make or receive the IFQ or QS transfer 
who has not paid all IFQ fees that are due (as provided under 
Sec. 679.45(a)) has timely appealed the administrative determination 
that IFQ fees have not been paid in full and has submitted to NMFS an 
amount sufficient to satisfy any disputed liability pending a final 
agency action.

[[Page 710]]

    (9) Other pertinent information requested on the Application for 
Transfer has been supplied to the satisfaction of the Regional 
Administrator.
    (d) Eligibility to receive QS or IFQ by transfer--(1) Application 
for Eligibility. All persons applying to receive QS or IFQ must submit 
an Application for Eligibility to Receive QS/IFQ (Application for 
Eligibility), containing accurate information, to the Regional 
Administrator. The Regional Administrator will not approve a transfer of 
IFQ or QS to a person until the Application for Eligibility for that 
person is approved by the Regional Administrator. The Regional 
Administrator shall provide an Application for Eligibility form to any 
person on request.
    (2) Type of eligibility. A person must indicate on the Application 
for Eligibility whether the eligibility sought is as:
    (i) An individual; or
    (ii) A corporation, partnership, or other entity.
    (3) Application filing order. A person may submit the Application 
for Eligibility with the Application for Transfer or file the 
Application for Eligibility prior to submitting the Application for 
Transfer. If a person, as described in paragraph (d)(2)(ii) of this 
section, files the Application for Eligibility prior to submitting the 
Application for Transfer, and that person's status subsequently changes, 
as described in Sec. 679.42(j), that person must resubmit an Application 
for Eligibility before submitting, or with, the Application for 
Transfer.
    (4) Notification of approval. Applicants will be notified by mail of 
the Regional Administrator's approval of an application for eligibility.
    (5) Notification of disapproval. The Regional Administrator will 
notify the applicant if an Application for Eligibility is disapproved. 
This notification of disapproval will include:
    (i) The disapproved Application for Eligibility.
    (ii) An explanation of why the Application for Eligibility was not 
approved.
    (6) Reasons for disapproval. Reasons for disapproval of an 
Application for Eligibility may include, but are not limited to:
    (i) Fewer than 150 days of experience working as an IFQ crewmember.
    (ii) Lack of compliance with the U.S. citizenship or corporate 
ownership requirements specified by the definition of ``person'' at 
Sec. 679.2.
    (iii) An incomplete Application for Eligibility.
    (iv) Fines, civil penalties, or other payments due and owing, or 
outstanding permit sanctions, resulting from Federal fishery violations.
    (e) Transfers of QS blocks--(1) General. A QS block must be 
transferred as an undivided whole, unless the size of the QS block 
exceeds the use limits specified at Sec. 679.42. If the QS block to be 
transferred exceeds the use limits specified at Sec. 679.42, the 
Regional Administrator will divide the block into two blocks, one block 
containing the maximum amount of QS allowable under the QS use limits 
and the other block containing the residual QS.
    (2) Sablefish. QS blocks for the same IFQ regulatory area and vessel 
category that represent less than 5,000 lb (2.3 mt) of sablefish IFQ, 
based on the 1996 TAC share for fixed gear sablefish in a specific IFQ 
regulatory area and the QS pool for that IFQ regulatory area on January 
31, 1996, may be consolidated into larger QS blocks provided that the 
consolidated blocks do not represent greater than 5,000 lbs (2.3 mt) of 
sablefish IFQ based on the preceding criteria. A consolidated block 
cannot be divided and is considered a single block for purposes of use 
and transferability. The maximum number of QS units that may be 
consolidated into a single QS block in each IFQ regulatory area is as 
follows:
    (i) Southeast Outside district: 33,270 QS.
    (ii) West Yakutat district: 43,390 QS.
    (iii) Central GOA regulatory area: 46,055 QS.
    (iv) Western GOA regulatory area: 48,410 QS.
    (v) Aleutian Islands subarea: 99,210 QS.
    (vi) Bering Sea subarea: 91,275 QS.
    (3) Halibut. QS blocks for the same IFQ regulatory area and vessel 
category that represent less than 3,000 lbs (1.4 mt) of halibut IFQ, 
based on the 1996 catch limit for halibut in a specific IFQ regulatory 
area and the QS pool

[[Page 711]]

for that IFQ regulatory area on January 31, 1996, may be consolidated 
into larger QS blocks provided that the consolidated blocks do not 
represent greater than 3,000 lbs (1.4 mt) of halibut IFQ based on the 
preceding criteria. A consolidated block cannot be divided and is 
considered a single block for purposes of use and transferability. The 
maximum number of QS units that may be consolidated into a single block 
in each IFQ regulatory area is as follows:
    (i) Area 2C: 19,992 QS.
    (ii) Area 3A: 27,912 QS.
    (iii) Area 3B: 44,193 QS.
    (iv) Subarea 4A: 22,947 QS.
    (v) Subarea 4B: 15,087 QS.
    (vi) Subarea 4C: 30,930 QS.
    (vii) Subarea 4D: 26,082 QS.
    (viii) Subarea 4E: 0 QS.
    (f) Transfer of QS or IFQ with restrictions. If QS or IFQ must be 
transferred as a result of a court order, operation of law, or as part 
of a security agreement, but the person receiving the QS or IFQ by 
transfer does not meet all of the eligibility requirements of this 
section, the Regional Administrator will approve the Application for 
Transfer with restrictions. The Regional Administrator will not assign 
IFQ resulting from the restricted QS to any person. IFQ with 
restrictions may not be used for harvesting halibut or sablefish with 
fixed gear. The QS or IFQ will remain restricted until:
    (1) The person who received the QS or IFQ with restrictions meets 
the eligibility requirements of this section and the Regional 
Administrator approves an Application for Eligibility for that person; 
or
    (2) The Regional Administrator approves the Application for Transfer 
from the person who received the QS or IFQ with restrictions to a person 
who meets the requirements of this section.
    (g) Transfer restrictions. (1) Except as provided in paragraph (f) 
or paragraph (g)(2) of this section, only persons who are IFQ crew 
members or who were initially issued QS assigned to vessel categories B, 
C, or D, and meet the other requirements in this section, may receive by 
transfer QS assigned to vessel categories B, C, or D, or the IFQ 
resulting from it.
    (2) Except as provided in paragraph (g)(3) of this section, only 
persons who are IFQ crew members, and meet the other requirements in 
this section, may receive by transfer QS assigned to vessel categories 
B, C, or D, or the IFQ resulting from it, in IFQ regulatory area 2C for 
halibut or in the IFQ regulatory area east of 140\ W. long. for 
sablefish.
    (3) Individuals who were initially issued QS assigned to vessel 
categories B, C, or D may transfer that QS to a corporation that is 
solely owned by the same individual. Such transfers of QS assigned to 
vessel categories B, C, or D in IFQ regulatory area 2C for halibut or in 
the IFQ regulatory area east of 140 deg. W. long. for sablefish will be 
governed by the use provisions of Sec. 679.42(i); the use provisions 
pertaining to corporations at Sec. 679.42(j) shall not apply.
    (4) The Regional Administrator will not approve an Application for 
Transfer of QS assigned to vessel categories B, C, or D subject to a 
lease or any other condition of repossession or resale by the person 
transferring QS, except as provided in paragraph (h) of this section, or 
by court order, operation of law, or as part of a security agreement. 
The Regional Administrator may request a copy of the sales contract or 
other terms and conditions of transfer between two persons as 
supplementary information to the transfer application.
    (h) Transfer of IFQ. (1) Pursuant to paragraph (a) of this section, 
an Application for Transfer must be approved by the Regional 
Administrator before a person may use any IFQ that results from a direct 
transfer to harvest halibut or sablefish. After approving the 
Application for Transfer, the Regional Administrator will change any IFQ 
accounts affected by the approved transfer and issue all necessary IFQ 
permits.
    (2) IFQ resulting from category B, C, or D QS may not be transferred 
separately from its originating QS, except as provided in paragraph (k) 
of this section.
    (i) Transfer across catcher vessel categories--(1) CDQ compensation. 
Persons issued CDQ compensation QS in a catcher vessel category, 
pursuant to Sec. 679.41(j), and in an IFQ regulatory

[[Page 712]]

area in which they do not hold QS other than CDQ compensation QS, may 
use that CDQ compensation QS on any catcher vessel. This exemption from 
catcher vessel categories ends upon the first transfer of the CDQ 
compensation QS. CDQ compensation QS being transferred will be 
permanently assigned to a specific catcher vessel category as designated 
by the person receiving the transfer.
    (2) CDQ compensation QS definition. For purposes of this paragraph 
(i), CDQ compensation QS is QS issued as compensation for halibut and 
sablefish harvest privileges foregone due to the CDQ Program, as 
provided in paragraph (j) of this section.
    (j) Compensation for CDQ allocations. (1) The Regional Administrator 
will compensate persons that receive a reduced halibut QS in IPHC 
regulatory areas 4B, 4C, 4D, or 4E because of the halibut CDQ program by 
adding halibut QS from IPHC regulatory areas 2C, 3A, 3B, and 4A. This 
compensation of halibut QS from areas 2C, 3A, 3B, and 4A will be 
allocated in proportion to the amount of halibut QS foregone due to the 
CDQ allocation authorized by this section.
    (2) The Regional Administrator will compensate persons that receive 
a reduced sablefish QS in any BSAI IFQ regulatory area because of the 
sablefish CDQ program by taking sablefish QS from the IFQ regulatory 
areas of the GOA and allocating it in proportion to the loss suffered by 
persons in the BSAI area. Such additional compensation of sablefish QS 
will be allocated in proportion to the amount of sablefish QS foregone 
due to the CDQ allocation authorized by this section.
    (3) Persons initially issued QS for IFQ regulatory areas in which a 
portion of the TAC is allocated to the CDQ Program will be compensated 
for halibut and sablefish harvest privileges foregone due to the CDQ 
Program. If a person does not hold QS in an IFQ regulatory area on the 
date the compensation is issued, that person's compensation will be 
issued as unblocked. If a person does hold QS in an IFQ regulatory area 
on the date compensation is issued, that person's compensation will be 
added to their existing QS in that IFQ regulatory area. The resulting QS 
amount will be blocked or unblocked according to the criteria found at 
Sec. 679.40(a). Compensation will be calculated for each non-CDQ area 
using the following formula:

QN = (QCxQSPN x RATE)/
    (SUMCDQ- [RATE x SUMTAC]) ([1-RATE] x 
    TACAVE)(QSPC x [CDQ PCT-RATE])

Where:

QN = quota share in non-CDQ area
QC = quota share in CDQ area
QSPN = quota share pool in non-CDQ area (as existing on 
January 31, 1995)
RATE = SUMCDQ/average of the TAC (1988-1994) for all CDQ and 
non-CDQ areas
TACAVE = average of the TAC (1988-1994) for CDQ area
QSPC = quota share pool in CDQ area (as existing on January 
31, 1995)
CDQPCT = CDQ percentage for CDQ area
SUMCDQ = sum [TACAVExCDQPCT]
SUMTAC = sum [TACAVE]

    (k) Survivorship transfer privileges--(1) On the death of an 
individual who holds QS or IFQ, the surviving spouse or, in the absence 
of a surviving spouse, a beneficiary designated pursuant to paragraph 
(k)(2) of this section, receives all QS and IFQ held by the decedent by 
right of survivorship, unless a contrary intent was expressed by the 
decedent in a will. The Regional Administrator will approve an 
Application for Transfer to the surviving spouse or designated 
beneficiary when sufficient evidence has been provided to verify the 
death of the individual.
    (2) QS holders may provide the Regional Administrator with the name 
of a designated beneficiary from the QS holder's immediate family to 
receive survivorship transfer privileges in the event of the QS holder's 
death and in the absence of a surviving spouse.
    (3) The Regional Administrator will approve, for 3 calendar years 
following the date of death of an individual, an Application for 
Transfer of IFQ from the surviving spouse or, in the absence of a 
surviving spouse, from a beneficiary from the QS holder's immediate 
family designated pursuant to paragraph (k)(2) of this section to a 
person eligible to receive IFQ under the provisions of this section, 
notwithstanding

[[Page 713]]

the limitations on transfers of IFQ in paragraph (h)(2) of this section.

[61 FR 31230, June 19, 1996, as amended at 61 FR 33385, June 27, 1996; 
61 FR 41526, Aug. 9, 1996; 61 FR 67964, Dec. 26, 1996; 63 FR 47368, 
Sept. 4, 1998; 65 FR 14942, Mar. 20, 2000; 66 FR 27910, May 21, 2001; 67 
FR 4133, 4148, Jan. 28, 2002]