[Code of Federal Regulations]
[Title 50, Volume 7]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 50CFR259.32]

[Page 646-648]
 
                    TITLE 50--WILDLIFE AND FISHERIES
 
  CHAPTER II--NATIONAL MARINE FISHERIES SERVICE, NATIONAL OCEANIC AND 
           ATMOSPHERIC ADMINISTRATION, DEPARTMENT OF COMMERCE
 
PART 259_CAPITAL CONSTRUCTION FUND--Table of Contents
 
Sec. 259.32  Conditional fisheries.

    (a) The Secretary may from time-to-time establish certain fisheries 
in which CCF benefits will be restricted. The regulatory mechanism for 
so doing is part 251 of this chapter. Each fishery so restricted is 
termed a ``conditional fishery''. Subpart A of part 251 of this chapter 
establishes the procedure to be used by the Secretary in proposing and 
adopting a fishery as a conditional fishery. Subpart B of part 251 of 
this chapter enumerates each fishery actually adopted as a conditional 
fishery (part 251 of this chapter should be referred to for details). 
The purpose of this Sec. 259.32 is to establish the effect of 
conditional fishery adoption upon Interim CCF Agreements.
    (b) If a written request for an otherwise permissible action under 
an Interim CCF Agreement is submitted prior to the date upon which 
conditional fishery adoption occurs, then the Secretary will act, in an 
otherwise normal manner, upon so much of the action then applied for as 
is then permissible without regard to the subsequent adoption of a 
conditional fishery (even, if that adoption occurs before the Secretary 
gives his consent or issues an Interim CCF Agreement or amendment 
thereto, all as the case may be). Nevertheless, the conditions as set 
forth in paragraph (d) of this section shall apply.
    (c) If a written request for an otherwise permissible action under 
an Interim CCF Agreement, or an application for an Interim CCF 
Agreement, is submitted after the date upon which conditional fishery 
adoption occurs, then the Secretary will act, in an otherwise normal 
manner, upon so much of the action then applied for as is then 
permissible without regard to the previous adoption of a conditional 
fishery provided, however, that this paragraph shall apply only to 
construction or reconstruction for which a binding contract has been 
reduced to writing prior to the date upon which conditional fishery 
adoption occurred. Nevertheless, the conditions as set forth in 
paragraph (d) of this section shall apply.
    (d) Conditional fishery adoption shall have no effect whatsoever 
upon a

[[Page 647]]

Schedule B objective whose qualification for withdrawal (which may be in 
an amount equal to the total cost over time of a Schedule B objective, 
i.e., a series of withdrawals) has been, prior to the date of 
conditional fishery adoption, either consented to by the Secretary or 
requested in accordance with paragraph (b) or (c) of this section. This 
extends to past, present, and future withdrawals in an amount 
representing up to 100 percent of the cost of a Schedule B objective. 
Commencement of any project in these categories shall, however, be 
started not later than 6 months from the date of conditional fishery 
adoption and shall be completed within 24 months from the date of 
conditional fishery adoption, unless for good and sufficient cause shown 
the Secretary, at his discretion, consents to a longer period for either 
project commencement or completion. Consent to the qualification of 
withdrawal for any project in these categories not commenced or 
completed within the periods allowed shall be revoked at the end of the 
periods allowed.
    (e) Conditional fishery adoption shall have no effect whatsoever 
upon Schedule B objectives which will not result in significantly 
increasing harvesting capacity in a fishery adopted as a conditional 
fishery.
    (1) Construction of a new vessel (vessel ``Y'') for operation in an 
adopted conditional fishery shall be deemed to significantly increase 
harvesting capacity in that fishery unless the party causing the ``Y'' 
vessel to be constructed causes (within 1 year after the delivery of 
vessel ``Y'') to be permanently removed from all fishing, or placed 
permanently in a fishery not then adopted as a conditional fishery, 
under such conditions as the Secretary may deem necessary or desirable, 
a vessel (vessel ``Z'') which has during the previous 18 months operated 
substantially in the same fishery as the ``Y'' vessel and which has a 
fishing capacity substantially equivalent to the ``Y'' vessel. Failure 
to remove a vessel could subject all withdrawals to be treated as 
nonqualified and may be cause for termination of the CCF. What 
constitutes substantially equivalent fishing capacity shall be a matter 
for the Secretary's discretion. Ordinarily, in exercising his discretion 
about what does or does not constitute substantially equivalent fishing 
capacity, the Secretary will take into consideration (i) the average 
size of vessels constructed for the adopted conditional fishery in 
question at the time vessel ``Z'' was constructed (or, if constructed 
for a different fishery, the average size of vessels in the adopted 
conditional fishery at the time vessel ``Z'' entered it), (ii) the 
average size of vessels constructed for the adopted conditional fishery 
at the time vessel ``Y'' was or will be constructed, and (iii) such 
other factors as the Secretary may deem material and equitable, 
including the length of time the party had owned or leased vessel ``Z'' 
and the length of time the vessel has operated in the conditional 
fishery. The Secretary will consider these factors, and exercise his 
discretion, in such a way as to encourage use of this program by 
established fishermen who have owned or leased for substantial periods 
vessels which need to be replaced, even though a ``Z'' vessel may have 
been constructed at a time which dictated a lesser fishing capacity than 
dictated for a ``Y'' vessel at the time of its construction.
    (2) Acquisition and/or reconstruction of a used vessel for operation 
in an adopted conditional fishery shall be deemed to significantly 
increase harvesting capacity in that fishery unless the vessel to be 
acquired and/or reconstructed had during the previous 3 years operated 
substantially in the same fishery as the adopted conditional fishery in 
which it will operate after acquisition and/or reconstruction. If less 
than 3 years, then acquisition and/or reconstruction of a used vessel 
for operation in an adopted conditional fishery shall be deemed to 
significantly increase harvesting capacity in that fishery unless there 
occurs vessel removal or permanent placement elsewhere under the same 
conditions specified for construction in paragraph (e)(1) of this 
section.
    (3) Construction of a new vessel or the acquisition and/or 
reconstruction of a used vessel for operation in an adopted conditional 
fishery shall not be deemed to significantly increase the harvesting 
capacity where the vessel

[[Page 648]]

constructed, acquired and/or reconstructed replaces another vessel which 
was lost or destroyed and which had, immediately prior to the loss or 
destruction, operated in the same fishery as the adopted conditional 
fishery, provided, however, that the fishing capacity of the replacement 
vessel has a fishing capacity substantially equivalent to the vessel 
lost or destroyed and that the construction, acquisition and/or 
reconstruction is completed within 2 years after the close of the 
taxable year in which the loss or destruction occurred. The Secretary 
may, at his discretion, and for good and sufficient cause shown, extend 
the replacement period, provided that the request for extension of time 
to replace is timely filed with the Secretary
    (f) Conditional fishery adoption shall have the following effect on 
all Schedule B objectives (whether for acquisition, construction, or 
reconstruction) which the Secretary deems to significantly increase 
harvesting capacity in that fishery, excluding those circumstances 
specifically exempted by paragraphs (b) through (e) of this section 
(which shall be governed by the provisions of paragraphs (b) through (e) 
of this section).
    (1) The Secretary may nevertheless consent to the qualification of 
withdrawal, but only up to an amount not exceeding the total of eligible 
ceilings actually deposited during tax years other than the taxable year 
in which conditional fishery adoption occurs plus a pro-rata portion of 
eligible ceilings generated in the tax year in which conditional fishery 
adoption occurs. Pro-ration shall be according to the number of months 
or any part thereof in a party's tax year which elapse before the 
adoption of the conditional fishery occurs. For example, if a party's 
tax year runs from January 1, 1974, to December 31, 1974, and 
conditional fishery adoption occurs on August 15, 1974, (i.e., during 
the 8th month of the party's tax year), then the pro-rata portion for 
that year is eight-twelfths of the total eligible ceilings generated 
during that year.
    (2) Qualified withdrawals in excess of the amount specified in 
paragraph (f)(1) of this section shall not, during the continuance of 
the adopted conditional fishery, be consented to. Parties at this point 
shall have the following option:
    (i) Make, with the Secretary's consent, a nonqualified withdrawal of 
the excess and discontinue the future deposit of eligible ceilings 
(which may effect termination of the Interim CCF Agreement).
    (ii) Reserve the excess, as well as the future deposit of eligible 
ceilings, for a Schedule B objective not then involving an adopted 
conditional fishery. If amendment of an Interim CCF Agreement is 
necessary in order to include a Schedule B objective not then involving 
an adopted conditional fishery, the party may, with the Secretary's 
consent, make the necessary amendment.
    (iii) Reserve the excess, as well as the future deposit of eligible 
ceilings, for a Schedule B objective involving a then adopted 
conditional fishery in anticipation that the then adopted conditional 
fishery will eventually be disadopted, in which case all deposits of 
eligible ceilings will once again be eligible for the Secretary's 
consent as qualified withdrawals. If the adoption of a conditional 
fishery continues for a substantial length of time and there is no 
forseeable prospect of disadoption, then the Secretary, in his 
discretion, may require paragraph (f)(2)(i) or (ii) of this section to 
be effected.
    (g) The Secretary shall neither enter into a new Interim CCF 
Agreement, nor permit amendment of an existing one, which involves a 
Schedule B objective in a then adopted conditional fishery unless 
paragraph (b), (c) or (d) of this Sec. 259.32 applies or unless the 
Schedule B objective is expressly conditioned upon acquisition 
construction, or reconstruction of the type permitted under paragraph 
(e) of this Sec. 259.32. Such an express condition would not survive 
beyond the time at which conditional fishery status is removed.