DEPARTMENT OF COMMERCE

National Institute of Standards and Technology

15 CFR Part 280

Docket Number: 970724177-8057-02

RIN: 0693-AB43

PROCEDURES FOR IMPLEMENTATION OF THE FASTENER QUALITY ACT

AGENCY: National Institute of Standards and Technology, United States Department of Commerce

ACTION: Final Rule and Extension of implementation date

SUMMARY: The Director of the National Institute of Standards and Technology (NIST), United States Department of Commerce, and the Under Secretary of the Bureau of Export Administration (BXA), United States Department of Commerce (collectively referred to as the Department), are today issuing a final rule based on comments received in response to the notice of proposed rulemaking published in the Federal Register on September 8, 1997 (62 FR 47240-47260)(1997)) amending regulations found at 15 CFR Part 280 implementing the Fastener Quality Act (the Act). This final rule establishes the procedures for registration of in-process inspection activities of qualifying manufacturing facilities that use Quality Assurance Systems (QAS), revises definitions and related sections for clarity, and corrects editorial errors. These changes will facilitate the implementation of the Act and will better accommodate modern industry practices by incorporating these practices into the certification process of fasteners covered by the Act. This rule also extends the implementation date of the Fastener Quality Act by sixty days to July 26, 1998.

DATES: This rule is effective [insert 30 days after date of publication in the FEDERAL REGISTER]. The date of implementation of the Act is July 26, 1998.

FOR FURTHER INFORMATION CONTACT: Dr. Subhas G. Malghan, FQA Program Manager, Technology Services, National Institute of Standards and Technology, Building 820, Room 306, Gaithersburg, MD 20899, telephone number (301) 975-5120.

SUPPLEMENTARY INFORMATION

The Fastener Quality Act (the Act) protects the public safety by: (1) requiring that certain fasteners which are sold in commerce conform to the specifications to which they are represented to be manufactured; (2) providing for accreditation of laboratories and registration of manufacturing facilities engaged in fastener testing; and (3) requiring inspection, testing and certification, in accordance with standardized methods, of fasteners covered by the Act.

The Secretary of Commerce, acting through the Director of NIST, published final regulations implementing the Act on September 26, 1996. Those regulations established procedures under which: (1) laboratories in compliance with the Act may be listed; (2) laboratories may apply to NIST for accreditation; (3) private laboratory accreditation entities (bodies) may apply to NIST for approval to accredit laboratories; and (4) foreign laboratories accredited by their governments or by organizations recognized by the NIST Director under section 6(a)(1)(C) of the Act can be deemed to satisfy the laboratory accreditation requirements of the Act. The regulation also established, within the Patent and Trademark Office (PTO), a recordation system to identify the manufacturers or distributors of covered fasteners to ensure that the fasteners may be traced to their manufacturers or private label distributors. In addition, the regulations contained provisions on testing and certification of fasteners, sale of fasteners subsequent to manufacture, recordkeeping, applicability of the Act, enforcement, civil penalties, and hearing and appeal procedures.

Following issuance of the final regulations on September 26, 1996, the automobile industry approached the Department and expressed its concern that the Act and the implementing regulations did not recognize the use of modern manufacturing methods using prevention-based quality assurance systems employing statistical process controls (SPC). On February 4, 1997, a Public Workshop was held at NIST to solicit information from all interested parties, including the automobile, aerospace, construction, and fastener industries on the use of prevention-based quality assurance systems employing SPC in the manufacture of fasteners. The Department published a notice of proposed rule making in the Federal Register on September 8, 1997, seeking public comments on proposed amendments to the regulations that recognize the use of prevention-based quality assurance systems under the Act.

To incorporate Quality Assurance Systems/Statistical Process Control (QAS/SPC) into the regulations, the Department proposed adding section 280.104, Accreditation of Certain Manufacturing Facilities as Laboratories; subpart I, Special Rule for the Accreditation of Certain Fastener Manufacturing Facilities, Whose Implemented Fastener Quality Assurance Systems Meet Defined Requirements, as Laboratories; subpart J, Recognition of Foreign Registrar Accreditation Bodies; subpart K, Requirements for Registrar Accreditation Bodies (Accreditors); and subpart L, Requirements for Registrars. In addition, the Department proposed adding a definition of Fastener Quality Assurance System (FQAS) and defining the terms Accreditor, Registrar, and Facility. The Department also proposed amendments to section 280.6, Laboratory Test Reports and section 280.10, Sampling, to specify requirements for facilities.

As explained in detail below, based on the comments received, the Department has included all the proposed changes, with some editorial corrections and clarifications, in the final rule. For further clarification, the Department also has included definitions for recognized accreditor, accredited registrar, registered facility, and authorized representative, and has amended the definition of consensus standards organization to clarify that it is NIST that will identify such organizations.

Of the 125 commenters, 69 commented on the issue of incorporating SPC/QAS into the FQA regulations; 44 favored the incorporation of SPC/QAS into the FQA regulations, and 25 were opposed.

Of the 44 commenters who favored the incorporation of SPC/QAS into the FQA regulations, thirteen were fastener manufacturers, ten domestic and three foreign; thirteen were trade associations, ten domestic and three foreign; six were manufacturers of products that incorporate fasteners, three aerospace manufacturers, two automobile manufacturers (one domestic and one foreign), and one foreign equipment manufacturer; three were fastener distributors; three were consultants; one was a government agency; one was a foreign QAS registrar; and four were other interested parties, two domestic and two foreign.

Of the 25 commenters opposed to the incorporation of SPC/QAS into the FQA regulations, four were consultants; four were laboratory accreditors/assessors; three were domestic fastener manufacturers; two were fastener distributors; three were government agencies; one was a raw material manufacturer; and seven were other interested parties.

Comment: Support for the proposed incorporation of QAS/SPC into the regulation was widespread, although many raised questions on details of the regulation, as is explained more fully elsewhere in this document. However, a substantial minority of the commenters, twenty-five, expressed the concern that without final testing, the QAS/SPC scheme proposed by NIST would not ensure the quality of fasteners covered by the regulations, and would fail to protect the public safety.

Response: The decision by the Department to include QAS/SPC into the regulations as an alternative to end-of-line sampling and testing is based upon strong evidence that QAS/SPC reduces the defect rate in the fastener manufacturing process. A lower defect rate means that fewer fasteners are manufactured that fail to comply with relevant standards and specifications, and thus that fewer defective fasteners will enter into commerce. Public safety is preserved and enhanced. Furthermore, the Department has structured the regulation to provide checks and balances to ensure that this is the case.

The administrative record for this rule-making contains strong evidence that QAS/SPC systems utilizing continuous monitoring and control in the manufacturing process yields a substantially lower defect rate than do traditional manufacturing techniques that rely solely upon end-of-line sampling and testing. Testimony at the Public Workshop of February 7, 1997 indicates that the use of QAS/SPC may reduce the defect rate from the range of thousands or tens of thousands parts-per-million experienced by traditional manufacturing techniques to approximately 100 parts-per-million. The improved manufacturing techniques embedded in QAS/SPC thus improve the quality of fasteners by reducing the portion of each lot that fails to meet standards and specifications. The regulations being issued today offer the benefits of QAS/SPC manufacturing to consumers in this country. But consistent with the FQA, these regulations also mandate in-process inspection and testing of fasteners manufactured under QAS/SPC systems, to verify that the promise of QAS/SPC is the reality.

As a means of providing checks and balances to the process controls that underlie the QAS/SPC methodology, the regulations mandate in-process inspection and testing of fasteners to assure the quality of fasteners, and thus the protection of public safety. Process controls in QAS/SPC facilities are required by the regulation to be augmented by all testing required by the standards and specifications that the manufacturer holds out that a given lot meets. The general rule is set out in section 280.104(a), which states that registration of a fastener manufacturing facility employing a fastener quality assurance system (FQAS) shall be deemed to meet the requirements of accreditation of a laboratory under the FQA. This general rule is amplified in section 280.2, which defines the term FQAS, and section 280.10, which sets out requirements for sampling methods to be followed by QAS/SPC facilities.

These sections of the regulation address three issues in the regime required of QAS/SPC facilities:

• What is the sampling methodology required of QAS/SPC facilities as part of their responsibility to conduct in-process testing and inspection?
• What specific tests and testing techniques must QAS/SPC facilities apply to the samples that are to be tested?
• Where must these tests be performed?

Tests are as required in the relevant standards and guidelines.

Where testing occurs in the QAS/SPC regime is governed by section 280.104(b) of the regulations, which requires that all in-process laboratory inspection and testing must be performed in laboratories accredited under the FQA; and section 280.104(d), which requires that the chemical composition of all fastener lots manufactured under QAS/SPC must be conducted in laboratories accredited under the FQA. In-process testing and inspection may occur within Registered Facilities.

In the view of the Department, these requirements meet the statutory mandates of the FQA, and protect the public safety.

Comment: Eight commenters addressed the issue of whether subcontracted processes required final testing by an accredited laboratory or whether they could be performed by another Facility.

Comment: Eight commenters suggested that Quality Assurance Systems are not equivalent, and that they do not define which characteristics to measure and how to measure them.

Response: No changes have been made to the regulations based on these comments because the QAS facilities must meet equally rigorous standards to maintain their registration by an accredited Registrar.

Comment: Two commenters requested that the regulations be amended to allow QAS in lieu of metal testing by a metal manufacturer.

Comment: Ten commenters suggested deleting references to ISO-9000 in the definition of Fastener Quality Assurance System because it lacks quality details and does not contain the details of ISO-25. In addition, three of these commenters stated that the proposed rule does not satisfy the intent of the Congress and will have a serious effect on the laboratory accreditation, and that a final inspection should be still required.

Response: No changes were made to the regulations based on these comments. The regulations are clear on laboratory accreditation and registration of fastener manufacturing facilities. The laboratory accreditation is performed in accordance with ISO Guides 58 and 25, and specific requirements of the Act and the regulations. Registration of fastener manufacturing facilities is carried out in accordance with the ISO Guides 61, 62 and the specific requirements of the Act and the regulations. The revised rule accommodating QAS facilities is fully within the intent of the Act because under QAS, fasteners are produced to stringent standards that yield fasteners of at least as good quality as end-of-line laboratory testing can assure. Since the two programs, accreditation and registration, are treated separately, the Department does not believe that laboratory accreditation will be seriously affected.

Comment: Two commenters suggested that the Department specify a level of revision of ISO Guides referred to in the QAS regulations that will assure the Department that the QAS approved today will remain compliant in the future.

Response: No changes were made to the regulations based on these comments. As they currently exist, the ISO Guides referenced in the QAS regulations fulfill the needs of the Act and the regulations. The regulations are sufficiently flexible to accommodate moderate change in these standards.

Comment: One commenter remarked that the parameters of a control plan are not discussed in the proposed rule.

Response: No changes were made to the regulations based on this comment because the Department has decided that the broad parameters described in section 280.2 are sufficient.

Response: No changes were made to the regulations based on this comment because the definition of QAS describes specific criteria to be met by the QAS facility.

Comment: One commenter suggested adding a requirement that personnel who collect data pursuant to the operation of a QAS be held to the same standards of training, experience and competency as laboratory personnel.

Response: No changes were made to the regulations based on this comment. The processes involved in laboratory testing differ from those in a QAS facility. Requirements for personnel performing tasks involved in these processes differ. The requirements for laboratory personnel are described in ISO Guide 25. The requirements for QAS facility personnel are described, in general, in the fastener QAS followed by that QAS facility.

Comment: One commenter remarked that QAS plans should be required to measure all characteristics called for in the standard and specification, rather than just those that the manufacturer finds appropriate for product functionality.

Comment: One commenter asked if a fastener standard does not accept SPC as an alternative to the final testing, then can the SPC be used.

Response: No changes were made to the regulations based on this comment. If a fastener standard does not accept SPC, SPC may not be used to meet the requirements of that standard.

Comment: One commenter requested amending section 280.5 to confer upon the major end user the responsibility of specifying how a lot of fasteners is to be tested, including in accordance with major end users in-house publication or in accordance with QAS, rather than in accordance with the embedded standards and specifications.

Response: No changes were made to the rule based on this comment because section 5(b)(1) of the Act requires that a manufacturer have lot samples tested to determine whether the lot conforms to the standards and specifications to which the manufacturer represents it has been manufactured. The Act does not offer the flexibility of delegating this responsibility to the end user.

Comment: One commenter suggested adding a definition of major end user to the rule.

Response: The Department has not made any changes to the regulations based on this comment. A definition of major end user is not necessary because the term major end user does not appear in the regulations.

Comment: One commenter remarked that NIST overlooked the basis of its Malcolm Baldrige award, and NIST should practice its quality outreach program by reissuing regulations to encompass ISO-9002 and QS-9000 and state of the art quality programs.

Response: No changes were made to the regulations based on this comment. ISO-9002 and QS-9000 are used worldwide while the Malcolm Baldrige criteria are familiar only to United States firms. Since fasteners to which the Act and the regulations apply are produced worldwide, international standards are more appropriate.

Comment: One commenter proposed an amendment to section 280.5 of the rule to clarify that a manufacturer that follows QAS is in compliance with the Act.

Response: No changes were made based on this comment because section 280.5(a) states the rule for inspecting, testing, and certification of covered fasteners, and section 280.104(a) brings registered QAS facilities under this general rule, and therefore, in compliance with the Act.

Comment: Nine commenters stated that manufacturers registered to QAS should not have to prepare test reports as proposed in section 280.6(b) and that requirement would make the QAS program unworkable. These commenters stated that amendments to proposed section 280.6(b) would be necessary. In addition, two additional commenters requested that the Department reduce the contents of the test reports for QAS facilities since it is unnecessary and burdensome, limit requirements to those of the Act and require just a statement that fasteners conform to the QAS plan on the report.

Response: The requirement for a test report is mandated by sections 5 and 7 of the Act. However, based on these comments, amendments have been made to section 280.6(b) of the regulations by deleting certain reporting requirements. Also, similar amendments were made in section 280.6(a) to simplify laboratory test report requirements for both laboratories and Facilities. Further, section 280.7 was amended to accommodate amendments made to section 280.6.

Comment: Two commenters asked whether imported fasteners produced under QAS must be accompanied by a certificate and laboratory testing report.

Comment: Two commenters asked that QAS reports include basic and unique identification information to tie a particular fastener lot with the report and control plan.

Comment: Three commenters suggested allowing facilities to make a certified statement that fasteners with a specific lot number are fulfilling the requirements of stated standards and specifications, in place of a detailed test report as required by section 280.6(b).

Comment: One commenter asked how he should report QAS test results in accordance with the regulations.

Response: No changes were made to the regulations based on this comment because section 280.6 describes procedures for reporting QAS test results.

Comment: Two commenters addressed a conflict between section 280.10, which pertains to sampling, and one of the goals of QAS. According to these commenters, section 280.10 appears to permit a plan provided by a Fastener QAS only when the standards and specifications do not provide for size, selection and integrity of the sample. However, one of the goals of QAS is to have a control plan which describes a sampling plan. Therefore, these commenters requested guidance on which sampling plan should they follow. Another commenter requested allowing sampling plans specified by the customer in a QAS control plan.

Comment: Three commenters remarked that the default sampling plans prescribed in the regulations are overly restrictive. One commenter cited the example of sampling plans restricting lot size to 250,000 pieces while manufacturing lots may be larger.

Response: No changes were made to the regulations based on this comment. Section 5(b)(2)(B) of the Act provides that default sampling plans prescribed by the Secretary must, to the extent practicable, use consensus testing standards and related materials. Sampling plans are prescribed by these standards and specifications. NIST does not have the authority to change those standards.

Comment: Eighteen commenters stated that the planned implementation date of May 26, 1998 will not allow enough time for NIST to approve Accreditors, for Accreditors to accredit Registrars, and for the Registrars to register fastener manufacturing facilities. Suggested approaches were: (1) to delay implementation date of the Act until a sufficient number of facilities are registered, (2) to grant provisional approval of current QAS-registered facilities and begin audit in six months, (3) to convene a meeting of all interested parties to establish a reasonable time line for industry compliance.

Response: The Department has studied these comments and assessed the registration requirements of the fastener industry. To accommodate the industry needs, the Department has developed the following plan, codified in section 280.810(c)(3), to provisionally approve current QAS-registered facilities so that commerce in fasteners is unaffected as a result of the July 26, 1998 implementation date.

If a Facility intends to be listed in accordance with section 280.810(c)(1) but the registration process will not be completed by July 26, 1998, the Facility may be provisionally listed on the Facilities List by providing the following to NIST on or before September 30, 1998:

The Facility must meet all the requirements of the Act and the regulations by May 25, 1999. If the Facility fails to receive FQA registration by May 25, 1999, it will be removed from the Facilities List.

Comment: Six commenters requested delaying the implementation date (for example, one more year) so that outstanding questions can be interpreted and lead time provided to get ready for implementation of the Act.

Comment: Three commenters, including a U.S. government agency, requested delaying the implementation date until a detailed regulatory flexibility analysis is conducted and published for public comment. They claim the proposed regulations will have a significant negative impact on fastener distributors and manufacturers because of the cost of inventory scrapped, the cost of accrediting laboratories, the loss of potential market share because of exemption of fasteners in free trade zones, the disruption in supply and resulting loss of business to OEM customers, the disproportionate cost of laboratory accreditation on QAS registered facilities, and the disproportionate cost to certify raw materials.

Response: A detailed regulatory flexibility analysis was conducted and published as part of the final regulations on September 26, 1996, which considered almost all issues raised by these commenters. The remaining issues related to QAS regulations were addressed as part of the proposed rule on September 8, 1997. As noted above, the Department has delayed the imnplementation date until July 26, 1998.

Comment: An agency of the U.S. Government commented that the proposed rule does not provide a meaningful regulatory alternative to small businesses because of the short deadline of May 26, 1998, and does not address economic impact on affected sectors.

Response: The Department has addressed the issue of the short deadline for registering a sufficient number of facilities before the July 26, 1998 implementation date by adding section 280.810(c)(3), which allows provisional approval of current QAS-registered facilities if they meet certain requirements.

On the issue of cost of inventory produced before the implementation date, the industry has long recognized this problem and has had adequate time to react appropriately. This issue has been discussed several times since the 1992 comment process. In its January 10, 1995, report and recommendations for amending the Act, the Public Law Task Force, the fastener industry coalition, recommended that fasteners manufactured before the implementation date not be allowed to be certified as conforming fasteners under the Act. This recommendation was endorsed by the Fastener Advisory Committee in letters to Congress dated February 9, 1995. Other cost elements were addressed in the September 26, 1996 notice of final rulemaking.

280.104 Accreditation of Certain Manufacturing Facilities as Laboratories.

Response: No changes were made to the regulations based on this comment. The requirement that in-process testing be performed by a laboratory on the Accredited Laboratory List is included in the regulations because registration of a QAS facility under ISO Guide 9001 or 9002 or QS-9000 does not include evaluation of technical credibility and validity of test results from an accredited laboratory.

Comment: One commenter stated that having to be assessed by a body approved by NIST is just as onerous a burden as getting laboratory accreditation.

Response: Based on this comment, the Department revised section 280.104(d) of the regulations to clarify which tests must be performed by a laboratory on the Accredited Laboratory List.

Comment: Three commenters suggested making laboratories used by QAS registered facilities meet ISO Guide 25 and proficiency testing requirements so that QAS registered facilities provide consistency in accreditation of laboratories.

Response: Since these requirements are already present in the revised regulations, no changes were made.

Comment: One commenter suggested that since laboratories must comply with stricter standards (ISO-25, EN-45001, etc) than manufacturers, the Department should allow laboratories owned by distributors to use the same standards as manufacturers.

Response: No changes have been made to the regulations because manufacturers follow QAS standards defined under section 280.2 of the regulations to qualify as a QAS facility. Distributors are not manufacturers manufacturing, hence they cannot follow the same standards as the manufacturers. However, irrespective of the ownership of the laboratory, the laboratory has to meet the same requirements.

Comment: One commenter stated that recognizing SPC as an alternative to final testing inspection is unlikely to benefit the aerospace industry because aerospace industry specifications specifically do not allow SPC.

Response: No changes were made to the regulations based on this comment because the incorporation of fastener specific QAS standards is an essential element of the QAS requirements. If the aerospace industry requires final testing and inspection, it will not be affected by the addition of the QAS option.

Comment: One commenter suggested that if a chemical laboratory is included in the registration of a QAS registered facility, there is no need to go to an accredited laboratory for testing.

Response: No changes were made based on this comment. Section 280.104(d) requires that chemical testing be performed by a laboratory on the Accredited Laboratory List. Section 280.104(b) allows that such a laboratory may be located on the same premises as a fastener manufacturing facility if the laboratory is separately accredited pursuant to a provision of the regulations other than section 280.104(a). Therefore, a chemical laboratory cannot be accredited through registration process.

Comment: One commenter requested providing clarification as to when a QAS Facility does testing and when an accredited laboratory does testing.

Response: In response to this comment, section 280.104(d) has been amended to clarify the requirements for laboratory tests.

Subparts I-L: Accreditation of Manufacturing Facilities; Foreign Accreditors; Accreditors; Registrars.

Comment: Two commenters requested amending section 280.800 to allow the use of QAS facilities registration by another agency, in addition to NIST.

Response: No changes were made to the regulations based on this comment. NIST is the only government agency allowed to carry out laboratory accreditation under section 6 of the Act.

Comment: Three commenters suggested recognizing accreditation bodies that have been recognized by organizations other than NIST. Two commenters mentioned recognizing accreditation bodies assessed under the International Accreditation Forum. One commenter suggested that if one accreditation body is recognized in Europe under the Act and the regulations, NIST should recognize all other bodies that are part of multilateral agreements to which the recognized accreditation body is a party.

Response: No changes were made to the rule based on this comment. Section 6 of the Act allows FQA accreditation only by bodies recognized by NIST. Under this regulatory program, each accreditation body must apply to NIST directly and be individually evaluated to obtain recognition. Blanket accreditation under a multilateral agreement or under an international forum would not allow NIST to ensure that each accreditation body meets all requirements of the Act and the regulations.

Comment: One commenter asked if the Registrars will be required to evaluate the substantive content of control plan.

Response: Under the definition of a Fastener QAS in section 280.2, one of the elements of a QAS is a requirement that a fastener manufacturer fully document a detailed control plan. Therefore, it is the responsibility of the manufacturer to develop and maintain a detailed control plan. However, as part of the registration process, a Registrar is required to evaluate the contents of the control plan.

Comment: One commenter stated that in Japan, a government body approves QAS registered fastener manufacturing facilities as JIS Marking factories. In this situation, the commenter asked, how will the proposed system of registration work.

Response: No changes were made to the regulations based on this comment because the system of registration in the current regulations is based on internationally accepted procedures. The system proposed by the commenter is different from the internationally accepted standard procedures. The commenter has two options to comply with the regulations: 1. Separation of registration and accreditation activities; or 2. Use of a private registrar to register facilities.

Comment: One commenter asked if the United Kingdom Accreditation Service (UKAS) can accredit Registrars for QAS assessments.

Response: No changes were to the regulations based on this comment because the procedures for seeking recognition by NIST-ABEP are described in the ABEP handbook. If interested in engaging in the accreditation of Registrars, UKAS must apply to NIST-ABEP for recognition.

Comment: One commenter inquired whether approving Registrars will require additional resources for NIST. According to the commenter, if NIST approves registrars, it will be perceived as expansion of government into a role previously performed by the private sector. If that is the case, the commenter asked, why not NIST rely on the private sector.

Response: No changes were made to the regulations based on this comment because the revised regulations clarify that NIST will not directly accredit Registrars. NIST will rely on NIST-approved private sector Registrar Accreditation Bodies to perform Registrar accreditation. There will be no additional resources required for NIST because section 6(d)(2) of the Act specifies that accreditation activities performed by NIST will be on a reimbursable basis.

Comment: One commenter asked how NIST-ABEP will assure that a manufacturer is competent to conduct fastener testing if the criteria is based on ISO-9000 series.

Response: No changes were made to the regulations based on this comment. Registering a fastener manufacturing facility to ISO-9000 does not indicate that the facility is competent to perform laboratory tests. Any laboratory tests performed during in-process inspection and testing must be performed by a laboratory on the Accredited Laboratory List.

Comment: One commenter commented that elements (ii), (iv), and (v) in proposed section 280.1010(d)(5) are not related to quality elements.

Response: No changes have been made to the regulations as a result of this comment. Section 280.1010(d)(5) details the requirements for a quality manual, which necessarily must contain administrative information as well as quality elements. The same information is required by ISO Guide 61, so these requirements are familiar to the industry.

Response: No change was made to the regulations. The ABEP handbook will provide guidance for interpreting these terms.

Comment: One commenter mentioned that section 280.1010(i)(2), the prohibition on disclosure of information about an accreditation body without its written consent, could interfere with the responsibilities of end-users to control the quality of their suppliers in quality management.

Comment: One commenter stated that there is a high probability of inconsistent requirements under various registration systems. This commenter specifically asked how NIST will assure that NIST and Registrar Accreditation Body recognition requirements are equivalent.

Response: No changes have been made to the regulations in response to this comment. Subparts I through L describe the criteria by which Registrar Accreditation Bodies will be approved and by which Registrars will be accredited by the approved bodies. NIST plans to closely adhere to these requirements to maintain uniformity among the Registrars accredited by various bodies.

Comment: One commenter asked if auditors will be approved for appropriate standard industrial codes. The commenter also asked if auditors will be required to be experts in both QAS and fastener technology.

Response: No changes were made to the regulations based on this comment. Approval of auditors will be the responsibility of accredited Registrars under subpart L, which is based on ISO Guide 62. Auditors will be required to be competent in both QAS and fastener technology. Additional requirements specific to the fastener technology will be described in the ABEP Handbook.

Response: No changes were made to regulations based on this comment because NIST does not foresee such a problem. The industry has indicated that accreditation bodies are ready to apply once the regulations take effect.

Comment: One commenter suggested that all Registrars currently approved by Registrar Accreditation Bodies should be automatically approved by NIST and all companies with QAS systems accredited by those Registrars should be deemed to have approved QAS.

Response: No changes were made to the regulations based on this comment. Recognition of Accreditation Bodies, accreditation of Registrars, and registration of Facilities under the Act and the regulations include meeting requirements specific to the Act and regulations. Therefore, prior recognition, accreditation, or registration, based on different requirements, are insufficient to meet the requirements of the Act and the regulations.

Comment: One commenter suggested appointing the major users of QS-9000 as registrars.

Response: The requirements for an organization to qualify as a registrar are outlined in subpart L. If a major user wants to become a registrar, it must meet those requirements and must apply to a recognized registrar accreditation body to become an accredited registrar.

Comment: One commenter requested that the Act should merely require that certification [recognition of accreditation bodies and accreditation of registrars] be made in accordance with applicable standards because existing certification practices are sufficient to meet the purposes of the Act.

Response: No changes were made to the regulations based on this comment because existing practices do not require that accrediation bodies and registrars meet the specific requirements of the Act and its implementing regulations and, therefore, are insufficient for these purposes.

Response: No changes were made to the regulations based on this comment. The regulations apply only to FQA accreditations, not all accreditations. Therefore, the current language of section 280.1010(e) refers only to partial or total suspension or withdrawal of accreditation under the FQA.

Comment: One commenter requested deleting the requirement for accreditors in section 280.1010(b)(17) that they must have a structure where members are chosen to provide a balance of interest, where no single interest predominates.

Response: The Department has not made any changes to section 280.1010(b)(17) based on this comment because a balance of interest is required to maintain objectivity in making decisions related to accreditation.

Comment: One commenter requested deleting section 280.1010(b)(18), which is a requirement for accreditors that offer other products, processes or services not to compromise confidentiality or the objectivity or impartiality of its accreditation process and decisions.

Response: No changes were made to the regulations based on this comment because, according to ISO Guide 61, this is a necessary condition that assures a fair decision making process in granting accreditations.

Comment: Two commenters requested changing the reassessment period for accreditors, registrars, and QAS manufacturing facilities from two years to three years to be consistent with the policies of the International Accreditation Forum.

Response: No changes were made to the regulations based on this comment. The Department has decided to retain the two year reassessment period in order to be consistent with the laboratory accreditation reassessment period under the Act and the regulations.

Comment: Three commenters requested that NIST should have an oversight role on the Registrar activities to assure uniformity.

Response: No changes were made to the regulations based on this comment. Detailed descriptions of oversight roles will appear in the ABEP Handbook.

Six issues were addressed in the proposed amendments with a request for public comment. A discussion of the comments received, and the actions taken by the Department as a result of these comments follows:

Of the 125 commenters, 15 commented on the issue of significant alteration of fasteners; eight favored the proposed changes to the FQA regulations, and seven others offered different issues in the area of significant alteration. Of the eight commenters who favored the proposed changes regarding the significant alteration of fasteners, four were trade associations, three domestic and one foreign; two were fastener manufacturers, one domestic and one foreign; one was a fastener distributor; and one was an other interested party. Of the seven commenters who proposed changes regarding the significant alteration of fasteners, three were government agencies; two were aerospace manufacturers; and two were consultants.

Comment: One aerospace manufacturer, one professional organization and one consulting organization commented that other alterations such as application of adhesives, locking elements and cutting off of finished fasteners should be considered significant alterations.

Comment: The Department received three comments, two from distributors and one from an equipment manufacturer, requesting that the regulations be revised to allow alterers who electroplate the option of either testing or warning rather than requiring them to test to the plating specifications.

Response: Based upon advice from the Fastener Advisory Committee, which deliberated this issue at great length during the initial review of the regulations implementing the Act and recommended the requested option not be offered for electroplating due to concerns about hydrogen embrittlement as a result of electroplating, the Department has made no changes to the rule.

Comment: One distributor suggested deleting all references to adhesives and sealants from the regulations and workshop materials and requested that the Department issue a clarifying statement that these issues are not covered by the Act.

The proposed rule included a proposed new section 280.11(c) to allow a fastener user or purchaser to special order fasteners covered under the Act and regulations without the required manufacturer or grade identification markings under certain conditions. Based on comments received, the Department has excluded this section from the final rule.

Comment: Two commenters suggested that the head marking exclusion be moved to section 280.700(b).

Response: No changes have been made based on this proposal. Since the Department has decided not to adopt the proposed change, it will not appear in either section.

Comment: Several commenters stated that the proposal to remove head markings is contrary to the intent of the Act, and that markings are vital for informing the user of strength levels and traceability. These commenters emphasized that the removal of head markings does not conform with the purpose of the Act that fasteners conform with standards to which they were represented to have been manufactured. One commenter from a trade association stated that removal of markings promotes unsafe alteration of fasteners. Three commenters (a manufacturer and two trade associations) noted that allowing the removal of markings could lead to misapplication, misrepresented fasteners, entry of substandard fasteners into commerce, and significant equipment failures. These commenters stated that if the end users want fasteners without markings, they can contract to have them made that way. One manufacturer stated that no sales should be allowed without the markings. Two commenters from U.S. Government agencies stated that the removal of head markings would hinder investigations and reduce accountability; therefore, it should not be allowed.

Response: Based on these comments, the Department has decided not to adopt the proposed change but to retain the existing rule.

Of the 125 commenters, 18 commented on the issue of originals vs. copies of test reports; 13 favored the proposed changes, and five were opposed. Of the 13 commenters who favored the proposed changes regarding originals vs. copies of test reports, five were trade associations, two domestic and three foreign; four were fastener manufacturers, three domestic and one foreign; three were consultants; and one was a government agency. Of the five commenters opposed to the proposed changes, two were government agencies; two were fastener manufacturers, one domestic and one foreign; and one was a raw material manufacturer.

Response: The Department has determined that the proposed rule does not prevent fastener manufacturers who choose to adopt QAS from obtaining chemical analysis, provided that the fastener manufacturers obtain such analysis from an accredited laboratory.

Comment: A manufacturer proposed an approach in which the fastener manufacturer keeps the actual test report of material chemistry and transfers only the data from the raw material test report.

Response: The Department has determined that this approach is not consistent with section 5 of the Act, according to which the entire chemical test report is necessary for traceability purposes.

Comment: One commenter recommended that the term "certified copy of test report" be explained or defined.

Comment: One consulting firm recommended that the Department repeal Section 280.15(d) of the regulations because it allows the fastener manufacturer to use tests performed on the raw materials by the metal manufacturer; however, the fastener manufacturer cannot prove that fasteners came from the same coil or heat as required by section 280.15(d).

Response: The Department has determined that repeal of this section is not appropriate at this time. Allowing chemical testing of raw material by the metal manufacturer to be sufficient for meeting the requirements of chemical certification of fasteners was one of several options recommended by a large segment of the industry as part of the 1996 amendments to the Act. The Fastener Advisory Committee supported this amendment.

Of the 125 commenters, seven commented on the issue of laboratory test reports; all favored the proposed changes. Of the seven commenters, three were trade associations, two domestic and one foreign; two were foreign fastener manufacturers; and one was a consultant.

Based on these comments, the Department has adopted the proposed amendments dealing with a discrepancy in the language used in reporting of alternative chemical characteristics. Following the amendments, section 280.6(b)(5)(ii), which is redesignated as section 280.6(c)(5)(ii), reads as follows:

Of the 125 commenters, 18 commented on the new definition of lot number; four were in favor of the proposed changes, and 14 were opposed. Of the four commenters who favored the proposed changes, two were trade associations, one domestic and one foreign; one was a fastener distributor; and one was a consultant. Of the 14 commenters who opposed the proposed changes, five were fastener manufacturers, four domestic and one foreign; three were domestic trade associations; three were government agencies; one was a fastener distributor; one was a fastener testing laboratory; and one was an other interested party.

The following issues were highlighted by those that opposed the adoption of the new definition of lot number:

- the proposed rule would prevent product recalls,

- the proposed rule would make counterfeiting easier

Response: The Department does not consider this to be an appropriate change because traceability would be questionable.

Response: No changes were made to the regulations based on these comments because importers and distributors can use a trace number to avoid confusion with the lot number that is assigned by manufacturers.

Comment: One commenter asked how the two numbers should be identified.

Response: The Department recommends that both numbers, the lot number assigned by the manufacturer and the trace number assigned by distributor or importer, appear on the package and wherever the trace number appears.

In response to the notice of proposed rulemaking, NIST received 28 comments on the issue of grandfathering, i.e., representing that fasteners produced prior to the implementation date of May 26, 1998 are in compliance with the Act and the regulations. Of the seven commenters that opposed any form of grandfathering, three were agencies of the U.S. Government, two were domestic fastener manufacturers, and one was a domestic trade association. Of the 21 commenters who suggested that grandfathering of different degrees should be allowed, 10 were fastener manufacturers, nine domestic and one foreign; five were domestic trade associations; three were fastener distributors; one was a foreign automobile manufacturer; and one was an other interested party.

In the notice of proposed rulemaking, the Department proposed amending section 280.12(c) of the regulations by moving the last sentence of that section, which states that fasteners manufactured prior to the implementation date of the Act may not be represented as being in conformance with the Act or the regulations, to section 280.602, Violations. Based on the comments and because as a prohibition on certain specific conduct, the language more appropriately belongs in the Violations section, the Department has included this change in the final rule, with appropriate modification to reflect the changes made to section 280.12 that are described below.

Although the commenters supported the proposed change, the comments NIST received offered a wide variety of alternative grandfathering solutions. The Department considered each of these, as well as other regulatory alternatives.

Following the September 8, 1997 notice of proposed rulemaking, the Department has considered the following alternative solutions to the grandfathering issue, each of which was supported by one or more comments:

NIST does not believe that the existing record permits it to endorse either option (3) or (6).

Various commenters questioned the statements made in the preamble to the proposed rule regarding the Paperwork Reduction Act or the Regulatory Flexibility Act or both. In general, these commenters stated that the Department understated the cost to industry to comply with the Act and regulations and the impact that those costs would have on small businesses. The costs cited in these comments included the costs of scrapping inventories and disruptions to supply because customers would not accept pre-implementation fasteners on or after the implementation date, the costs of obtaining laboratory accreditation or using an accredited laboratory, the costs of testing small lots, the costs of added paperwork and storage of records. Two specific proposals were made in regard to this issue. One proposal was to form a joint government-industry task force to measure the costs of compliance. The other proposal was to conduct an in-depth analysis of the negative impact on distributors and manufacturers under the Regulatory Flexibility Act and publish it for public comment. Several commenters recommended delaying implementation of the regulations because of the costs to industry. The Department notes that all of the concerns cited above relate to the cost of complying with the existing rule. The final rule creates an option for fastener manufacturers to use, in certain instances, instead of the existing rule. Any costs associated with developing a registered fastener QAS would not be affected by the costs of complying with the existing rule. Therefore, the Department is not delaying the implementation of the regulations due to this issue.

Comment: Two trade organizations commented that the cost of raw material analysis obtained by coil analysis is disproportionately high for small producers.

Response: No change is made based on this comment. The requirements for raw material analysis and reports under the Act are the same for large producers and small producers. Under the revised regulations, small firms may obtain raw material analysis reports from either the laboratory that conducted the tests or from the metal manufacturer.

The Department received many comments on issues that were not presented for public comment in the notice of proposed rulemaking. These issues included: repeal the Fastener Quality Act, amend the Fastener Quality Act, deem compliance with other regulations to be compliance with the Fastener Quality Act, create exemptions to the coverage of the Act and regulations, and define more terms. The Department will not respond to these comments at this time because they were not presented for public comment in the notice of proposed rulemaking but will retain these comments for possible action at a later date.

Additional Information:

This rule has been determined not to be significant under section 3(f) of Executive Order 12866.

This rule does not contain policies with Federalism implications sufficient to warrant preparation of a Federalism assessment under Executive Order 12612.

The Assistant General Counsel for Legislation and Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this rule will not have a significant economic impact on a substantial number of small entities. NIST received one comment, addressed above, regarding this certification. This comment did not cause a change in the determination regarding the certification. As a result, no final regulatory flexibility analysis was prepared.

Notwithstanding any other provision of the Act, 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, 44 U.S.C. 3501 et seq., unless that collection of information displays a currently valid Office of Management and Budget (OMB) control number.

This rule contains collections of information subject to the requirements of the Paperwork Reduction Act that have been cleared under OMB Control Nos. 0693-0015 and 0693-0026. The public reporting burden for the self-certification of QAS fastener manufacturing facilities is approximately four hours: the provisional registration is estimated at three hours, and one hour for the associated recordkeeping requirements. Send comments regarding these burden estimates or any other aspect of the data requirements, including suggestions for reducing the burden to the Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, D.C. 20230 (Attention: NIST Desk Officer) and to NIST (Attention: FQA Program Manager, NIST, Building 820, Room 306, National Institute of Standards and Technology, Gaithersburg, MD 20899).

This rule will not significantly affect the quality of the human environment. Therefore, an environmental assessment or Environmental Impact Statement is not required to be prepared under the National Environmental Policy Act of 1969.

Business and industry, Fastener industry, Imports

Robert E. Hebner William A. Reinsch

Acting Deputy Director Under Secretary

National Institute of for Export Administration

Standards and Technology

Dated: Dated: