[Federal Register Volume 81, Number 124 (Tuesday, June 28, 2016)]
[Rules and Regulations]
[Pages 42063-42214]
[FR Doc No: 2016-15079]

Vol. 81

Tuesday,

No. 124

June 28, 2016

Part II

Department of Transportation

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 Federal Aviation Administration

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14 CFR Parts 21, 43, 61, et al.

Operation and Certification of Small Unmanned Aircraft Systems; Final
Rule

Federal Register / Vol. 81 , No. 124 / Tuesday, June 28, 2016 / Rules
and Regulations

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 21, 43, 61, 91, 101, 107, 119, 133, and 183

[Docket No.: FAA-2015-0150; Amdt. Nos. 21-99, 43-48, 61-137, 91-343,
101-9, 107-1, 119-18, 133-15, and 183-16]
RIN 2120-AJ60

Operation and Certification of Small Unmanned Aircraft Systems

AGENCY: Federal Aviation Administration (FAA) and Office of the
Secretary of Transportation (OST), Department of Transportation (DOT).

ACTION: Final rule.

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SUMMARY: The FAA is amending its regulations to allow the operation of
small unmanned aircraft systems in the National Airspace System. These
changes address the operation of unmanned aircraft systems and
certification of their remote pilots. This rule will also prohibit
model aircraft from endangering the safety of the National Airspace
System.

DATES: This final rule is effective August 29, 2016.

ADDRESSES: For information on where to obtain copies of rulemaking
documents and other information related to this final rule, see ``How
To Obtain Additional Information'' in the SUPPLEMENTARY INFORMATION
section of this document.

FOR FURTHER INFORMATION CONTACT: For small UAS technical questions
concerning this final rule, contact Lance Nuckolls, Flight Technologies
and Procedures Division, AFS-400, 470 L'Enfant Plaza SW., Suite 4102,
Washington, DC 20024; telephone 1-844-FLY-MYUAS; email<EMAIL_ADDRESS>    For FAA small UAS policy questions concerning this final rule,
contact Everette Rochon, Manager, Commercial Operations Branch, AFS-
820, Flight Standards Service, Federal Aviation Administration, 55 M
Street SE., 8th Floor, Washington, DC 20003; telephone 1-844-FLY-MYUAS;
email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Table of Contents

I. Executive Summary
    A. Purpose of the Regulatory Action
    B. Summary of the Major Provisions of the Regulatory Action
    C. Costs and Benefits
II. Background
    A. Authority for This Rulemaking
    B. Analysis of Public Risk Posed by Small UAS Operations
    C. Current Statutory and Regulatory Structure Governing Small
UAS
    D. Integrating Small UAS Operations Into the NAS Through
Rulemaking
    E. Related UAS Integration Initiatives
III. Discussion of the Final Rule
    A. Incremental Approach and Waiver
    B. Discussion of the Applicable Statutory Framework
    C. Applicability
    1. Transporting Property for Compensation (Air Carrier
Operations)
    2. International Operations and Foreign-Owned Aircraft
    3. Public Aircraft Operations
    4. Model Aircraft
    5. Moored Balloons, Kites, Amateur Rockets, and Unmanned Free
Balloons
    6. Current Treatment of UAS and Grandfathering of Section 333
Exemption Holders
    D. Definitions
    1. Control Station
    2. Corrective Lenses
    3. Unmanned Aircraft
    4. Small Unmanned Aircraft
    5. Small Unmanned Aircraft System (Small UAS)
    6. Other Definitions
    E. Operating Rules
    1. Remote Pilot in Command
    a. Terminology
    b. Remote Pilot in Command
    c. Airman Certification Requirement
    d. Emergency Powers of a Remote Pilot in Command
    2. See-and-Avoid and Visibility Requirements
    a. Visual Line of Sight
    b. Visual Observer
    i. Definition of Visual Observer
    ii. Operational Requirements When Using Visual Observer
    iii. Optional Use of a Visual Observer
    iv. No Airman Certification or Required Training of Visual
Observer
    c. Additional Visibility Requirements
    i. Daytime Operations
    ii. Weather/Visibility Minimums
    iii. Yielding Right of Way
    d. Additional Technology/Conspicuity Requirements
    i. ADS-B, Transponders, and TCAS
    ii. Radio Equipment
    iii. Lighting
    iv. Conspicuity
    3. Containment and Loss of Positive Control
    a. Confined Area of Operation Boundaries
    i. Horizontal Boundary and Moving Vehicles
    ii. Vertical Boundary (Maximum Altitude)
    b. Mitigating Loss of Positive Control Risk
    i. Maximum Speed
    ii. Operating Multiple Unmanned Aircraft
    iii. Micro UAS
    iv. Flight Over People
    v. Preflight Briefing
    vi. Preflight Assessment of the Operating Area and Ensuring That
the Aircraft Poses No Undue Hazard
    1. Preflight Assessment of the Operating Environment
    2. Undue Hazard if There Is a Loss of Control
    vii. Automation
    viii. Other Equipage
    1. Geo-Fencing
    2. Flight Termination System
    3. Other Technological Equipage
    4. External Load and Dropping Objects
    a. External Load and Towing
    b. Dropping Objects
    5. Limitations on Operations in Certain Airspace
    a. Operations in Class B, C, D, and Lateral Boundaries of the
Surface Area of Class E Airspace Designated for an Airport
    b. Operations in Class A Airspace
    c. Prohibited or Restricted Areas
    d. Areas Designated by Notice to Airmen
    e. Operations in Class G Airspace
    6. Inspection, Maintenance, and Airworthiness Directives
    a. Inspections and Maintenance
    i. Preflight Check and Maintenance Requirements
    ii. Discontinuing Flight
    iii. Control Link Check
    b. Airworthiness Directives
    7. Additional Operating Provisions
    a. Careless or Reckless Operation
    b. Drug and Alcohol Prohibition
    c. Sufficient Power for the Small UAS
    F. Remote Pilot Certificate
    1. Use of UAS Experience To Apply for Part 61 Pilot Certificate
    2. Remote Pilot Certificate Eligibility and Issuance
    a. Minimum Age
    b. English Language Proficiency
    c. No Airman Medical Certificate Required
    d. Flight Proficiency and Aeronautical Experience
    e. Formal Training
    f. General Requirement for Initial Aeronautical Knowledge Test
    g. General Requirement for Recurrent Aeronautical Knowledge Test
    h. Pilots With Military Experience
    i. Credit to Holders of Part 61 Pilot Certificates
    j. Areas of Knowledge on the Aeronautical Knowledge Tests and
Training Courses for Part 61 Pilot Certificate Holders
    i. Regulations Applicable to Small UAS
    ii. Airspace Classifications and Operating Requirements, and
Flight Restrictions Affecting Small Unmanned Aircraft Operation
    iii. Obstacle Clearance Requirements
    iv. Aviation Weather Sources and Effects of Weather on Small
Unmanned Aircraft Performance
    v. Small UAS Loading and Performance
    vi. Emergency Procedures
    vii. Crew Resource Management
    viii. Determining the Performance of the Small Unmanned Aircraft
    ix. Physiological Effects of Drugs and Alcohol
    x. Aeronautical Decision-Making and Judgment
    xi. Airport Operations
    xii. Radio Communication Procedures
    xiii. Other Areas of Knowledge Suggested by the Commenters
    k. Administration of the Knowledge Tests and Training Courses
    i. Location of the Knowledge Test and Online Option for Training
Course
    ii. Cheating or Engaging in Unauthorized Conduct

    iii. Identification of the Test-Taker
    iv. Retesting After Failure
    l. Transportation Security Administration Vetting and Process
for Issuance
    i. TSA Vetting and Temporary Remote Pilot Certificates
    ii. Issuance and Positive Identification
    3. Remote Pilot Certificate Denial, Revocation, Suspension,
Amendment, and Surrender
    a. Drugs and Alcohol Violations
    b. Change of Name
    c. Change of Address
    d. Voluntary Surrender of Certificate
    e. Additional Comments on Remote Pilot Certificate
    G. Registration and Marking
    H. Fraud and False Statements
    I. Oversight
    1. Inspection, Testing, and Demonstration of Compliance
    2. Accident Reporting
    J. Statutory Findings
    1. Hazard to Users of the NAS or the Public
    2. National Security
    3. Airworthiness Certification
    K. Miscellaneous Provisions
    1. Mandatory Insurance
    2. Test Sites
    3. Noise and Environmental
    a. The National Environmental Policy Act
    b. Noise
    c. Other Environmental Comments
    4. Privacy
    5. First Amendment
    a. First Amendment Law in the United States
    b. Restrictions on Speech in a Non-Public Forum
    c. Incidental Restrictions on Speech
    d. Time, Place, Manner Restrictions on Speech
    6. Preemption
    7. Agricultural Operations
    8. Miscellaneous Comments
IV. Regulatory Notices and Analyses
    A. Regulatory Evaluation
    B. Final Regulatory Flexibility Determination
    1. A Statement of the Need for and Objectives of the Rule
    2. A Statement of the Significant Issues Raised by the Public
Comments in Response to the Initial Regulatory Flexibility Analysis,
a Statement of the Assessment of the Agency of Such Issues, and a
Statement of Any Changes Made in the Proposed Rule as a Result of
Such Comments
    3. The Response of the Agency to Any Comments Filed by the Chief
Counsel for Advocacy of the Small Business Administration (SBA) in
Response to the Proposed Rule, and a Detailed Statement of Any
Change Made to the Proposed Rule in the Final Rule as a Result of
the Comments
    4. A Description and an Estimate of the Number of Small Entities
to Which the Rule Will Apply, or an Explanation of Why No Such
Estimate Is Available
    5. A Description of the Projected Reporting, Recordkeeping and
Other Compliance Requirements of the Rule, Including an Estimate of
the Classes of Small Entities Which Will Be Subject to the
Requirement and the Type of Professional Skills Necessary for
Preparation of the Report or Record
    6. A Description of the Steps the Agency Has Taken To Minimize
the Significant Economic Impact on Small Entities Consistent With
the Stated Objectives of Applicable Statutes, Including a Statement
of the Factual, Policy, and Legal Reasons for Selecting the
Alternative Adopted in the Final Rule and Why Each One of the Other
Significant Alternatives to the Rule Considered by the Agency Which
Affect the Impact on Small Entities Was Rejected
    6. Describe Alternatives Considered
    C. International Trade Impact Assessment
    D. Unfunded Mandates Assessment
    E. Paperwork Reduction Act
    1. Obtaining a Remote Pilot Certificate With a Small UAS Rating
    Summary
    2. Accident Reporting.
    Summary
    3. Emergency Powers
    4. Certificate of Waiver
    5. Total Annual Burden Estimate
    F. International Compatibility and Cooperation
    G. Environmental Analysis
    H. Regulations Affecting Intrastate Aviation in Alaska
V. Executive Order Determinations
    A. Executive Order 13132, Federalism
    B. Executive Order 13211, Regulations That Significantly Affect
Energy Supply, Distribution, or Use
    C. Executive Order 13609, Promoting International Regulatory
Cooperation
VI. Additional Information
    A. Availability of Rulemaking Documents
    B. Comments Submitted to the Docket
    C. Small Business Regulatory Enforcement Fairness Act

List of Abbreviations and Acronyms Frequently Used in This Document

AC--Advisory Circular
AGL--Above Ground Level
ACR--Airman Certification Representative
ADS-B--Automatic Dependent Surveillance-Broadcast
ARC--Aviation Rulemaking Committee
ATC--Air Traffic Control
CAFTA-DR--Dominican Republic-Central America-United States Free
Trade Agreement
CAR--Civil Air Regulation
CFI--Certificated Flight Instructor
CFR--Code of Federal Regulations
COA--Certificate of Waiver or Authorization
DPE--Designated Pilot Examiner
FR--Federal Register
FSDO--Flight Standards District Office
ICAO--International Civil Aviation Organization
NAFTA--North American Free Trade Agreement
NAS--National Airspace System
NOTAM--Notice to Airmen
NPRM--Notice of Proposed Rulemaking
NTSB--National Transportation Safety Board
PIC--Pilot in Command
Pub. L.--Public Law
PMA--Parts Manufacturer Approval
TCAS--Traffic Collision Avoidance System
TFR--Temporary Flight Restriction
TSA--Transportation Security Administration
TSO--Technical Standard Order
UAS--Unmanned Aircraft System
U.S.C.--United States Code

I. Executive Summary

A. Purpose of the Regulatory Action

    This rule finalizes the notice of proposed rulemaking entitled
Operation and Certification of Small Unmanned Aircraft Systems \1\ (the
NPRM). The NPRM proposed operating and certification requirements to
allow small unmanned aircraft systems (small UAS) to operate for non-
hobby and non-recreational purposes.\2\ A small UAS consists of a small
unmanned aircraft (which, as defined by statute, is an unmanned
aircraft weighing less than 55 pounds \3\) and equipment necessary for
the safe and efficient operation of that aircraft. The FAA has
accommodated non-recreational small UAS use through various mechanisms,
such as special airworthiness certificates, exemptions, and
certificates of waiver or authorization (COAs). This rule is the next
phase of integrating small UAS into the NAS.
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    \1\ 80 FR 9544, Feb. 23, 2015.
    \2\ As used here, ``non-hobby and non-recreational purposes''
refers to small UAS that are not operated in accordance with section
336 of Public Law 112-95. A discussion of section 336 can be found
below in section III.C.4 of this preamble.
    \3\ Public Law 112-95, sec. 331(6).
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    The following are examples of possible small UAS operations that
can be conducted under the framework in this rule:

     Crop monitoring/inspection;
     Research and development;
     Educational/academic uses;
     Power-line/pipeline inspection in hilly or mountainous
terrain;
     Antenna inspections;
     Aiding certain rescue operations;
     Bridge inspections;
     Aerial photography; and
     Wildlife nesting area evaluations.

    Because of the potential societally beneficial applications of
small UAS, the FAA has been seeking to incorporate the operation of
these systems into the national airspace system (NAS) since 2008. In
2012, Congress passed the FAA Modernization and Reform Act of 2012
(Pub. L. 112-95). Section 333 of Public Law 112-95 directed the
Secretary to determine whether UAS operations posing the least amount
of public risk and no threat to national security could safely be
operated in the NAS and, if so, to establish requirements for the safe
operation of these systems in the NAS, prior to completion of the UAS

comprehensive plan and rulemakings required by section 332 of Public
Law 112-95.
    On February 23, 2015, as part of its ongoing efforts to integrate
UAS operations in the NAS and in accordance with section 333 of Public
Law 112-95, the FAA issued the NPRM proposing to amend its regulations
to adopt specific rules for the operation of small UAS in the NAS. Over
4,600 public comments were submitted in response to the NPRM. The FAA
has considered the comments, and now issues this final rule to
integrate small UAS into the NAS.
    Based on its consideration of the comments submitted in response to
the NPRM, and its experience with the certification, exemption, and COA
process, the FAA has developed the framework in this rule to enable
certain small UAS operations to commence upon adoption of this rule and
accommodate technologies as they evolve and mature. This framework
allows small UAS operations for many different non-recreational
purposes, such as the ones discussed previously, without requiring
airworthiness certification, exemption, or a COA.

B. Summary of the Major Provisions of the Regulatory Action

    This rule will add a new part 107 to Title 14 Code of Federal
Regulations (14 CFR) to allow for routine civil operation of small UAS
in the NAS and to provide safety rules for those operations. Consistent
with the statutory definition, this rule will define small UAS as UAS
that use unmanned aircraft weighing less than 55 pounds. To mitigate
risk, the rule will limit small UAS to daylight and civil twilight
operations with appropriate collision lighting, confined areas of
operation, and visual-line-of-sight operations. This rule will also
address airspace restrictions, remote pilot certification, visual
observer requirements, and operational limits in order to maintain the
safety of the NAS and ensure that small UAS do not pose a threat to
national security. Because UAS constitute a quickly changing
technology, a key provision of this rule is a waiver mechanism to allow
individual operations to deviate from many of the operational
restrictions of this rule if the Administrator finds that the proposed
operation can safely be conducted under the terms of a certificate of
waiver.
    Below is a summary of the major provisions of the rule.

          Table 1--Summary of the Major Provisions of Part 107
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Operational Limitations...............................
                                                         Unmanned
                                                         aircraft must
                                                         weigh less than
                                                         55 lbs. (25
                                                         kg).
                                                         Visual
                                                         line-of-sight
                                                         (VLOS) only;
                                                         the unmanned
                                                         aircraft must
                                                         remain within
                                                         VLOS of the
                                                         remote pilot in
                                                         command and the
                                                         person
                                                         manipulating
                                                         the flight
                                                         controls of the
                                                         small UAS.
                                                         Alternatively,
                                                         the unmanned
                                                         aircraft must
                                                         remain within
                                                         VLOS of the
                                                         visual
                                                         observer.
                                                         At all
                                                         times the small
                                                         unmanned
                                                         aircraft must
                                                         remain close
                                                         enough to the
                                                         remote pilot in
                                                         command and the
                                                         person
                                                         manipulating
                                                         the flight
                                                         controls of the
                                                         small UAS for
                                                         those people to
                                                         be capable of
                                                         seeing the
                                                         aircraft with
                                                         vision unaided
                                                         by any device
                                                         other than
                                                         corrective
                                                         lenses.
                                                         Small
                                                         unmanned
                                                         aircraft may
                                                         not operate
                                                         over any
                                                         persons not
                                                         directly
                                                         participating
                                                         in the
                                                         operation, not
                                                         under a covered
                                                         structure, and
                                                         not inside a
                                                         covered
                                                         stationary
                                                         vehicle.

                                                         Daylight-only
                                                         operations, or
                                                         civil twilight
                                                         (30 minutes
                                                         before official
                                                         sunrise to 30
                                                         minutes after
                                                         official
                                                         sunset, local
                                                         time) with
                                                         appropriate
                                                         anti-collision
                                                         lighting.
                                                         Must
                                                         yield right of
                                                         way to other
                                                         aircraft.
                                                         May use
                                                         visual observer
                                                         (VO) but not
                                                         required.
                                                         First-
                                                         person view
                                                         camera cannot
                                                         satisfy ``see-
                                                         and-avoid''
                                                         requirement but
                                                         can be used as
                                                         long as
                                                         requirement is
                                                         satisfied in
                                                         other ways.
                                                         Maximum
                                                         groundspeed of
                                                         100 mph (87
                                                         knots).
                                                         Maximum
                                                         altitude of 400
                                                         feet above
                                                         ground level
                                                         (AGL) or, if
                                                         higher than 400
                                                         feet AGL,
                                                         remain within
                                                         400 feet of a
                                                         structure.
                                                         Minimum
                                                         weather
                                                         visibility of 3
                                                         miles from
                                                         control
                                                         station.

                                                         Operations in
                                                         Class B, C, D
                                                         and E airspace
                                                         are allowed
                                                         with the
                                                         required ATC
                                                         permission.

                                                         Operations in
                                                         Class G
                                                         airspace are
                                                         allowed without
                                                         ATC permission.
                                                         No
                                                         person may act
                                                         as a remote
                                                         pilot in
                                                         command or VO
                                                         for more than
                                                         one unmanned
                                                         aircraft
                                                         operation at
                                                         one time.
                                                         No
                                                         operations from
                                                         a moving
                                                         aircraft.
                                                         No
                                                         operations from
                                                         a moving
                                                         vehicle unless
                                                         the operation
                                                         is over a
                                                         sparsely
                                                         populated area.
                                                         No
                                                         careless or
                                                         reckless
                                                         operations.
                                                         No
                                                         carriage of
                                                         hazardous
                                                         materials.

                                                         Requires
                                                         preflight
                                                         inspection by
                                                         the remote
                                                         pilot in
                                                         command.
                                                         A
                                                         person may not
                                                         operate a small
                                                         unmanned
                                                         aircraft if he
                                                         or she knows or
                                                         has reason to
                                                         know of any
                                                         physical or
                                                         mental
                                                         condition that
                                                         would interfere
                                                         with the safe
                                                         operation of a
                                                         small UAS.
                                                         Foreign-
                                                         registered
                                                         small unmanned
                                                         aircraft are
                                                         allowed to
                                                         operate under
                                                         part 107 if
                                                         they satisfy
                                                         the
                                                         requirements of
                                                         part 375.

                                                         External load
                                                         operations are
                                                         allowed if the
                                                         object being
                                                         carried by the
                                                         unmanned
                                                         aircraft is
                                                         securely
                                                         attached and
                                                         does not
                                                         adversely
                                                         affect the
                                                         flight
                                                         characteristics
                                                         or
                                                         controllability
                                                         of the
                                                         aircraft.

                                                         Transportation
                                                         of property for
                                                         compensation or
                                                         hire allowed
                                                         provided that--
                                                        [cir] The
                                                         aircraft,
                                                         including its
                                                         attached
                                                         systems,
                                                         payload and
                                                         cargo weigh
                                                         less than 55
                                                         pounds total;
                                                        [cir] The flight
                                                         is conducted
                                                         within visual
                                                         line of sight
                                                         and not from a
                                                         moving vehicle
                                                         or aircraft;
                                                         and
                                                        [cir] The flight
                                                         occurs wholly
                                                         within the
                                                         bounds of a
                                                         State and does
                                                         not involve
                                                         transport
                                                         between (1)
                                                         Hawaii and
                                                         another place
                                                         in Hawaii
                                                         through
                                                         airspace
                                                         outside Hawaii;
                                                         (2) the
                                                         District of
                                                         Columbia and
                                                         another place
                                                         in the District
                                                         of Columbia; or
                                                         (3) a territory
                                                         or possession
                                                         of the United
                                                         States and
                                                         another place
                                                         in the same
                                                         territory or
                                                         possession.
                                                         Most of
                                                         the
                                                         restrictions
                                                         discussed above
                                                         are waivable if
                                                         the applicant
                                                         demonstrates
                                                         that his or her
                                                         operation can
                                                         safely be
                                                         conducted under
                                                         the terms of a
                                                         certificate of
                                                         waiver.
Remote Pilot in Command Certification and
 Responsibilities.

                                                         Establishes a
                                                         remote pilot in
                                                         command
                                                         position.
                                                         A
                                                         person
                                                         operating a
                                                         small UAS must
                                                         either hold a
                                                         remote pilot
                                                         airman
                                                         certificate
                                                         with a small
                                                         UAS rating or
                                                         be under the
                                                         direct
                                                         supervision of
                                                         a person who
                                                         does hold a
                                                         remote pilot
                                                         certificate
                                                         (remote pilot
                                                         in command).
                                                         To
                                                         qualify for a
                                                         remote pilot
                                                         certificate, a
                                                         person must:
                                                        [cir]
                                                         Demonstrate
                                                         aeronautical
                                                         knowledge by
                                                         either:
                                                        [ssquf] Passing
                                                         an initial
                                                         aeronautical
                                                         knowledge test
                                                         at an FAA-
                                                         approved
                                                         knowledge
                                                         testing center;
                                                         or
                                                        [ssquf] Hold a
                                                         part 61 pilot
                                                         certificate
                                                         other than
                                                         student pilot,
                                                         complete a
                                                         flight review
                                                         within the
                                                         previous 24
                                                         months, and
                                                         complete a
                                                         small UAS
                                                         online training
                                                         course provided
                                                         by the FAA.
                                                        [cir] Be vetted
                                                         by the
                                                         Transportation
                                                         Security
                                                         Administration.
                                                        [cir] Be at
                                                         least 16 years
                                                         old.
                                                         Part 61
                                                         pilot
                                                         certificate
                                                         holders may
                                                         obtain a
                                                         temporary
                                                         remote pilot
                                                         certificate
                                                         immediately
                                                         upon submission
                                                         of their
                                                         application for
                                                         a permanent
                                                         certificate.
                                                         Other
                                                         applicants will
                                                         obtain a
                                                         temporary
                                                         remote pilot
                                                         certificate
                                                         upon successful
                                                         completion of
                                                         TSA security
                                                         vetting. The
                                                         FAA anticipates
                                                         that it will be
                                                         able to issue a
                                                         temporary
                                                         remote pilot
                                                         certificate
                                                         within 10
                                                         business days
                                                         after receiving
                                                         a completed
                                                         remote pilot
                                                         certificate
                                                         application.
                                                         Until
                                                         international
                                                         standards are
                                                         developed,
                                                         foreign-
                                                         certificated
                                                         UAS pilots will
                                                         be required to
                                                         obtain an FAA-
                                                         issued remote
                                                         pilot
                                                         certificate
                                                         with a small
                                                         UAS rating.
                                                        A remote pilot
                                                         in command
                                                         must:
                                                         Make
                                                         available to
                                                         the FAA, upon
                                                         request, the
                                                         small UAS for
                                                         inspection or
                                                         testing, and
                                                         any associated
                                                         documents/
                                                         records
                                                         required to be
                                                         kept under the
                                                         rule.
                                                         Report
                                                         to the FAA
                                                         within 10 days
                                                         of any
                                                         operation that
                                                         results in at
                                                         least serious
                                                         injury, loss of
                                                         consciousness,
                                                         or property
                                                         damage of at
                                                         least $500.
                                                         Conduct
                                                         a preflight
                                                         inspection, to
                                                         include
                                                         specific
                                                         aircraft and
                                                         control station
                                                         systems checks,
                                                         to ensure the
                                                         small UAS is in
                                                         a condition for
                                                         safe operation.
                                                         Ensure
                                                         that the small
                                                         unmanned
                                                         aircraft
                                                         complies with
                                                         the existing
                                                         registration
                                                         requirements
                                                         specified in
                                                         Sec.
                                                         91.203(a)(2).
                                                        A remote pilot
                                                         in command may
                                                         deviate from
                                                         the
                                                         requirements of
                                                         this rule in
                                                         response to an
                                                         in-flight
                                                         emergency.
Aircraft Requirements.................................   FAA
                                                         airworthiness
                                                         certification
                                                         is not
                                                         required.
                                                         However, the
                                                         remote pilot in
                                                         command must
                                                         conduct a
                                                         preflight check
                                                         of the small
                                                         UAS to ensure
                                                         that it is in a
                                                         condition for
                                                         safe operation.
Model Aircraft........................................   Part
                                                         107 does not
                                                         apply to model
                                                         aircraft that
                                                         satisfy all of
                                                         the criteria
                                                         specified in
                                                         section 336 of
                                                         Public Law 112-
                                                         95.
                                                         The
                                                         rule codifies
                                                         the FAA's
                                                         enforcement
                                                         authority in
                                                         part 101 by
                                                         prohibiting
                                                         model aircraft
                                                         operators from
                                                         endangering the
                                                         safety of the
                                                         NAS.
------------------------------------------------------------------------

C. Costs and Benefits

    Technological advances in small UAS have led to a potential
commercial market for their uses by providing a safe operating
environment for them and for other aircraft in the NAS. In addition to
enabling this industry to develop, the FAA anticipates that this final
rule will provide an opportunity to substitute small UAS operations for
some risky manned flights, such as inspection of houses, towers,
bridges, or parks, thereby averting potential fatalities and injuries.
    The FAA has analyzed the benefits and the costs associated with
this final rule. The estimated out-of-pocket cost for an individual to
become FAA certificated as a remote pilot with a small UAS rating is
$150, which is less than the cost of any other airman certification
that allows non-recreational operations in the NAS.\4\ The final rule
will enable a new industry to unfold while imposing relatively low
individual costs. The private sector expected benefits exceed private
sector expected costs because each entity voluntarily chooses to incur
the compliance cost of this rule in anticipation that their benefits
exceed the costs. The sum of these entities' actions results in
societal benefits which exceed societal costs when government costs are
also taken into account. The FAA has quantified these benefits by
estimating consumer surplus resulting from future commercial
operations. Benefits to society equal the consumer surplus minus
certain additional costs discussed.
---------------------------------------------------------------------------

    \4\ To become certificated as remote pilot with a small UAS
rating, an individual is only required to pass a knowledge test. The
certification does not require an individual to attend ground school
or to pass a practical skills exam, both of which are required to
receive an airman's certificate for sport pilot and above.
---------------------------------------------------------------------------

    The regulatory analysis for this final rule presents two scenarios
in order to present a range for costs--a high case and a low case. The
scenarios are based on two fleet forecasts that were prepared
independently at separate times. As a result, the high case and low
case projections for small UAS sales, fleet, and pilots differ
significantly.
    Depending on which small UAS forecast is used, the FAA expects this
rule will result in a net social benefit ranging from about $733
million in the low case to about $9.0 billion in the high case over
five years.\5\
---------------------------------------------------------------------------

    \5\ See the full regulatory evaluation for a detailed
description on the two small UAS forecasts the FAA used to estimate
benefits and costs.
---------------------------------------------------------------------------

II. Background

    This final rule addresses the operation and airman certification of
civil small UAS. The following sections discuss: (1) The public risk
associated with small UAS operations; (2) the current legal framework
governing small UAS operations; and (3) the FAA's ongoing efforts to
incorporate small UAS operations into the NAS.

A. Authority for This Rulemaking

    This rulemaking is promulgated under the authority described in the
FAA Modernization and Reform Act of 2012 (Pub. L. 112-95). Section 333
of Public Law 112-95 directs the Secretary of Transportation \6\ to
determine whether ``certain unmanned aircraft systems may operate
safely in the

national airspace system.'' If the Secretary determines, pursuant to
section 333, that certain unmanned aircraft systems may operate safely
in the national airspace system, then the Secretary must ``establish
requirements for the safe operation of such aircraft systems in the
national airspace system.'' \7\
---------------------------------------------------------------------------

    \6\ The primary authority for this rulemaking is based on
section 333 of Public Law 112-95 (Feb. 14, 2012). In addition, this
rulemaking also relies on FAA statutory authorities. Thus, for the
purposes of this rulemaking, the terms ``FAA,'' ``the agency,''
``DOT,'' ``the Department,'' and ``the Secretary'' are used
synonymously throughout this document.
    \7\ Public Law 112-95, sec. 333(c).
---------------------------------------------------------------------------

    This rulemaking is also promulgated pursuant to 49 U.S.C.
40103(b)(1) and (2), which charge the FAA with issuing regulations: (1)
To ensure the safety of aircraft and the efficient use of airspace; and
(2) to govern the flight of aircraft for purposes of navigating,
protecting and identifying aircraft, and protecting individuals and
property on the ground. In addition, 49 U.S.C. 44701(a)(5) charges the
FAA with prescribing regulations that the FAA finds necessary for
safety in air commerce and national security. This rulemaking also
establishes a new class of airman certificate tailored to remote
pilots, consistent with the statutory obligation set forth in 49 U.S.C.
44703.
    The model-aircraft component of this rulemaking incorporates the
statutory mandate in section 336(b) that preserves the FAA's authority,
under 49 U.S.C. 40103(b) and 44701(a)(5), to pursue enforcement
``against persons operating model aircraft who endanger the safety of
the national airspace system.''

B. Analysis of Public Risk Posed by Small UAS Operations

    Small UAS operations pose risk considerations that are different
from the risk considerations typically associated with manned-aircraft
operations. On one hand, certain operations of a small unmanned
aircraft, discussed more fully in section III.E of this preamble, have
the potential to pose significantly less risk to persons and property
than comparable operations of a manned aircraft due to differences in
the weight of the aircraft. The typical total takeoff weight of a
general aviation aircraft is between 1,300 and 6,000 pounds as compared
to a total takeoff weight of a small unmanned aircraft of less than 55
pounds. Consequently, because of the reduced weight, the small unmanned
aircraft would pose significantly less risk to persons and property on
the ground in the event of a mishap or pilot error. As such, a small
UAS operation whose parameters are well defined to mitigate risk to
other aircraft would also pose a smaller overall public risk or threat
to national security than the operation of a manned aircraft.
    On the other hand, even though small UAS operations have the
potential to pose a lower level of public risk in certain types of
operations, the unmanned nature of the small UAS operations raises two
unique safety concerns that are not present in manned-aircraft
operations. The first safety concern is whether the person operating
the small unmanned aircraft, who is physically separated from that
aircraft during flight, would have the ability to see manned aircraft
in the air in time to prevent a mid-air collision with that manned
aircraft. As discussed in more detail below, the FAA's regulations
currently require each person operating an aircraft to maintain
vigilance ``so as to see and avoid other aircraft.'' \8\ This is one of
the fundamental principles for collision avoidance in the NAS.
---------------------------------------------------------------------------

    \8\ 14 CFR 91.113(b).
---------------------------------------------------------------------------

    For manned-aircraft operations, ``see and avoid'' is the
responsibility of pilots on board an aircraft. Because the remote pilot
in an unmanned aircraft operation is not physically on the unmanned
aircraft, that remote pilot does not have the same visual perspective
and ability to see other aircraft as a manned-aircraft pilot. Thus, the
challenge for small unmanned aircraft operations is to ensure that the
person operating the small unmanned aircraft is able to see and avoid
other aircraft.
    The second safety concern with small UAS operations is the
possibility that, during flight, the person piloting the small unmanned
aircraft may lose control of the aircraft due to a failure of the
control link between the aircraft and the remote pilot's control
station. This is known as a loss of positive control and may result
from a system failure or because the aircraft has been flown beyond the
signal range or in an area where control link communication between the
aircraft and the control station is interrupted. A small unmanned
aircraft whose flight is unable to be directly controlled could pose a
significant risk to persons, property, or other aircraft.

C. Current Statutory and Regulatory Structure Governing Small UAS

    Due to the lack of an onboard pilot, small UAS operations cannot be
conducted in accordance with many of the FAA's current operating
regulations, codified in 14 CFR part 91, that apply to general
aviation. The primary example of this conflict is Sec.  91.113(b),
which requires each person operating an aircraft to maintain vigilance
``so as to see and avoid other aircraft.'' The FAA created this
requirement in a 1968 rulemaking,\9\ which combined two previous
aviation regulatory provisions (Civil Air Regulations (CAR) Sec. Sec.
60.13(c) and 60.30) into the ``see and avoid'' requirement now found in
Sec.  91.113(b). These CAR provisions were intended to address aircraft
collision-awareness problems by requiring a pilot on board the aircraft
to look out of the aircraft during flight to observe whether other
aircraft are on a collision path with his or her aircraft. Those
provisions did not contemplate the use of technology to substitute for
the human vision of a pilot on board the aircraft nor did they
contemplate the manipulation of the aircraft from outside of the
aircraft. To the contrary, CAR Sec.  60.13(c) stated that one of the
problems it intended to address was ``preoccupation by the pilot with
cockpit duties,'' which indicates that the regulation contemplated the
presence of a pilot on board the aircraft.
---------------------------------------------------------------------------

    \9\ Pilot Vigilance, 33 FR 10505 (July 24, 1968).
---------------------------------------------------------------------------

    Based on this intent, Sec.  91.113(b) requires an aircraft pilot to
have the perspective of being inside the aircraft as that aircraft is
moving in order to see and avoid other aircraft. Since the remote pilot
of a small UAS does not have this perspective, operation of a small UAS
cannot meet the see and avoid requirement of Sec.  91.113(b).
    In addition to regulatory considerations, there are statutory
considerations that apply to small UAS operations. For example, even
though a small UAS is different from a manned aircraft, the operation
of a small UAS still involves the operation of an aircraft under the
FAA's statute, which defines an ``aircraft'' as ``any contrivance
invented, used, or designed to navigate or fly in the air.'' 49 U.S.C.
40102(a)(6). Congress reaffirmed that an unmanned aircraft is an
aircraft in the FAA Modernization and Reform Act of 2012, by defining
unmanned aircraft as ``an aircraft that is operated without the
possibility of direct human intervention from within or on the
aircraft.'' Sec. 331(8), Public Law 112-95. In Administrator v. Pirker,
the National Transportation Safety Board (NTSB) unanimously affirmed
this understanding, finding that an unmanned aircraft is an aircraft
for purposes of the FAA's statutes and regulations.\10\
---------------------------------------------------------------------------

    \10\ Administrator v. Pirker, NTSB Order No. EA-5730 (Nov. 17,
2014). A copy of the Pirker opinion may be found at: http://www.ntsb.gov/legal/alj/Documents/5730.pdf.
---------------------------------------------------------------------------

    Because a small UAS involves the operation of an ``aircraft,'' this
triggers the FAA's registration and certification statutory
requirements. Specifically, subject to certain exceptions, a person

may not operate a civil aircraft that is not registered. 49 U.S.C.
44101(a). In addition, a person may not operate a civil aircraft in air
commerce without an airworthiness certificate. 49 U.S.C. 44711(a)(1).
Finally, a person may not serve in any capacity as an airman on a civil
aircraft being operated in air commerce without an airman certificate.
49 U.S.C. 44711(a)(2)(A).\11\
---------------------------------------------------------------------------

    \11\ The statutes also impose other requirements that are beyond
the scope of this rulemaking. For example, 49 U.S.C. 44711(a)(4)
prohibits a person from operating as an air carrier without an air-
carrier operating certificate.
---------------------------------------------------------------------------

    The term ``air commerce,'' as used in the FAA's statutes, is
defined broadly to include ``the operation of aircraft within the
limits of a Federal airway, or the operation of aircraft that directly
affects, or may endanger safety in foreign or interstate air
commerce.'' 49 U.S.C. 40102(a)(3). Because of this broad definition,
the NTSB has held that ``any use of an aircraft, for purpose of flight,
constitutes air commerce.'' \12\ Courts that have considered this issue
have reached similar conclusions that ``air commerce,'' as defined in
the FAA's statute, encompasses a broad range of commercial and non-
commercial aircraft operations.\13\
---------------------------------------------------------------------------

    \12\ Administrator v. Barrows, 7 N.T.S.B. 5, 8-9 (1990).
    \13\ See, e.g., United States v. Healy, 376 U.S. 75, 84 (1964)
(holding that the statutory definition of ``air commerce'' in the
Federal Aviation Act is not limited to commercial airplanes); Hill
v. NTSB, 886 F.2d 1275, 1280 (10th Cir. 1989) (``[t]he statutory
definition of `air commerce' is therefore clearly not restricted to
interstate flights occurring in controlled or navigable airspace'');
United States v. Drumm, 55 F. Supp. 151, 155 (D. Nev. 1944)
(upholding amendments of Civil Air Regulations, which among other
things prohibited any person from piloting a civil aircraft unless
the person held a valid pilot certificate and the aircraft possessed
an airworthiness certificate, on the grounds that the regulatory
action was within the scope of powers conferred by Congress).
---------------------------------------------------------------------------

    Accordingly, because ``air commerce'' encompasses such a broad
range of aircraft operations, a civil small unmanned aircraft cannot
currently be operated, for purposes of flight, if it does not comply
with the above statutes. However, the FAA's current processes for
issuing airworthiness and airman certificates were designed to be used
for manned aircraft and do not take into account the considerations
associated with civil small UAS.
    Because the pertinent existing regulations do not differentiate
between manned and unmanned aircraft, a small UAS is currently subject
to the same airworthiness certification process as a manned aircraft.
These existing regulations do not contemplate small UAS operations that
could, as a result of their operational parameters, safely be conducted
without any airworthiness certification. This framework imposes an
undue burden on such operations.
    Additionally, under current pilot certification regulations,
depending on the type of operation, the remote pilot in command of the
small UAS currently must obtain a sport, recreation, private,
commercial, or airline transport pilot certificate. While a private
pilot and commercial pilot may both operate an aircraft for the
furtherance of a business, a private pilot may only do so if the flight
is incidental to the pilot's business or employment and not for
compensation or hire. Only a commercial or airline transport pilot
certificate may be used to operate an aircraft for compensation or
hire.\14\
---------------------------------------------------------------------------

    \14\ See 14 CFR 61.113, 61.133 and 61.167(a).
---------------------------------------------------------------------------

    Typically, to obtain a sport, private, recreational, commercial, or
airline transport pilot certificate, the small UAS pilot currently has
to: (1) Receive training in specific aeronautical knowledge areas; (2)
receive training from an authorized instructor on specific areas of
aircraft operation; and (3) pass an aeronautical knowledge test and a
practical (skills) test. A certificate applicant also has to obtain
minimum hours of flight time prior to applying for the certificate: (1)
20 hours for a sport pilot certificate; (2) 30 hours for a recreational
pilot certificate; (3) 40 hours for a private pilot certificate; (4)
250 hours for a commercial pilot certificate; and (5) 1,500 hours for
an airline transport pilot certificate. Finally, the certificate
applicant has to establish his or her physical capability by: (1)
Holding a valid and effective driver's license (for a sport pilot
certificate); (2) obtaining a third-class airman medical certificate
(for a recreational or private pilot certificate); (3) obtaining a
second-class airman medical certificate (for a commercial pilot
certificate or to exercise second-in-command privileges of an airline
transport pilot certificate); or (4) obtaining a first-class airman
medical certificate (to exercise pilot-in-command privileges of an
airline transport pilot certificate).
    While these airman certification requirements are necessary for
manned aircraft operations, they impose an unnecessary burden for many
small UAS pilots because a person obtains a pilot certificate under
part 61 by learning how to operate a manned aircraft. Much of that
aeronautical experience/flight training is not applicable to small UAS
operations because a small UAS is operated differently than a manned
aircraft. In addition, the aeronautical/flight experience currently
necessary to obtain a pilot certificate under part 61 does not equip
the certificate holder with all of the tools necessary to safely pilot
a small UAS. Specifically, applicants for a pilot certificate under
part 61 currently are not trained in how to deal with those aspects of
``see-and-avoid'' and loss-of-positive-control safety issues that are
unique to small unmanned aircraft. Thus, requiring persons wishing to
operate a small UAS to obtain a pilot certificate under part 61 imposes
the cost of airman certification on those persons, but does not result
in a significant safety benefit because the process of obtaining the
certificate does not equip those persons with all of the tools
necessary to mitigate the public risk posed by small UAS operations.

D. Integrating Small UAS Operations into the NAS through Rulemaking

    To address the issues discussed above, the Department has been
engaged in a rulemaking to integrate small UAS into the NAS.\15\
---------------------------------------------------------------------------

    \15\ The FAA chartered the small UAS Aviation Rulemaking
Committee (ARC), which provided it with recommendations on how small
UAS could be safely integrated into the NAS. A copy of the ARC
Report and Recommendations can be found in the docket for this
rulemaking.
---------------------------------------------------------------------------

    In 2012, Congress passed the FAA Modernization and Reform Act of
2012 (Pub. L. 112-95). In section 332(b) of Public Law 112-95, Congress
directed the Secretary to issue a final rule on small unmanned aircraft
systems that will allow for civil operations of such systems in the
NAS.\16\ In section 333 of Public Law 112-95, Congress also directed
the Secretary to determine whether ``certain unmanned aircraft systems
may operate safely in the national airspace system.'' To make a
determination under section 333, the Secretary of Transportation must
assess ``which types of unmanned aircraft systems, if any, as a result
of their size, weight, speed, operational capability, proximity to
airports and populated areas, and operation within visual line of sight
do not create a hazard to users of the national airspace system or the
public or pose a threat to national security.'' Public Law 112-95, Sec.
333(b)(1). The Secretary must also determine whether a certificate of
waiver or authorization, or airworthiness certification is necessary to
mitigate the public risk posed by the unmanned aircraft systems that
are under consideration. Public Law 112-95, Sec. 333(b)(2). If the
Secretary

determines that certain unmanned aircraft systems may operate safely in
the NAS, then the Secretary must ``establish requirements for the safe
operation of such aircraft systems in the national airspace system.''
Public Law 112-95, Sec. 333(c). The flexibility provided for in section
333 did not extend to airman certification and security vetting,
aircraft marking, or registration requirements.
---------------------------------------------------------------------------

    \16\ As discussed in more detail further in the preamble, the
FAA Modernization and Reform Act of 2012 also contained a provision
prohibiting the FAA from issuing rules and regulations for model
aircraft meeting certain criteria specified in section 336 of the
Act.
---------------------------------------------------------------------------

    As discussed previously, the FAA's statute normally requires an
aircraft being flown outdoors to possess an airworthiness
certificate.\17\ However, subsection 333(b)(2) allows for the
determination that airworthiness certification is not necessary for
certain small UAS. The key determinations that must be made in order
for UAS to operate under the authority of section 333 are: (1) The
operation must not create a hazard to users of the national airspace
system or the public; and (2) the operation must not pose a threat to
national security.\18\ In making these determinations, the Secretary of
Transportation must consider the following factors: size, weight,
speed, operational capability, proximity to airports and populated
areas, and operation within visual line of sight.
---------------------------------------------------------------------------

    \17\ 49 U.S.C. 44711(a)(1).
    \18\ Public Law 112-95, sec. 333(b)(1).
---------------------------------------------------------------------------

    In 2013, the Department issued a comprehensive plan and
subsequently the FAA issued a roadmap of its efforts to achieve safe
integration of UAS operations into the NAS.\19\ As a result of its
ongoing integration efforts, the FAA seeks to change its regulations to
take the first step in the process of integrating small UAS operations
into the NAS. The NPRM proposed to utilize the airworthiness-
certification flexibility provided by Congress in section 333 of Public
Law 112-95, and allow some small UAS operations to commence in the
NAS.\20\ As noted earlier in this executive summary, the FAA published
the NPRM on February 23, 2015, and received over 4,600 comments. The
NPRM proposed to issue small UAS airman certificates to applicants who
passed a knowledge test, and proposed to allow line-of-sight operations
of small unmanned aircraft below 500 feet AGL at speeds of less than
100 miles per hour. Airworthiness certification would not be required
under the proposed rule. The FAA has considered the public comments
filed in response to the NPRM, and now issues this final rule.
---------------------------------------------------------------------------

    \19\ http://www.faa.gov/uas/media/uas_roadmap_2013.pdf.
    \20\ As discussed in section III.C.4 below, 14 CFR part 107 will
not apply to model aircraft that satisfy all of the statutory
criteria specified in section 336 of Public Law 112-95. The FAA has
recently published an interpretive rule for public comment
explaining the statutory criteria of Sec.  336. See Interpretation
of the Special Rule for Model Aircraft, 79 FR 36172, 36175 (June 25,
2014).
---------------------------------------------------------------------------

E. Related UAS Integration Initiatives

    While this rulemaking was pending, the FAA recognized that there
already exists a population of small UAS operators and remote pilots
who are ready and able to operate safely. To address the needs of these
operators and remote pilots while these regulations were being
finalized, the Department issued thousands of exemptions under its
section 333 authority to permit civil visual-line-of-sight small UAS
operations in the NAS.\21\ The operations permitted under those
exemptions are similar to those that will be enabled by part 107.
---------------------------------------------------------------------------

    \21\ http://www.faa.gov/uas/legislative_programs/section_333/.
---------------------------------------------------------------------------

    In addition, to further facilitate the integration of UAS into the
NAS, the FAA has chosen six UAS research and test site operators across
the country. In selecting the six test site operators, the FAA
considered geography, climate, location of ground infrastructure,
research needs, airspace use, safety, aviation experience, and risk. In
totality, these six test site applications achieve cross-country
geographic and climatic diversity and help the FAA meet its UAS
research needs. As of December 2015, all of the UAS test sites are
operational and are gathering operational data to foster further
integration, as well as evaluating new technologies. The FAA has also
selected, after a rigorous competition, a Mississippi State University
team as the FAA's Center of Excellence for Unmanned Aircraft Systems.
The Center of Excellence will focus on research, education, and
training in areas critical to safe and successful integration of UAS
into the NAS.\22\
---------------------------------------------------------------------------

    \22\ http://www.faa.gov/uas/legislative_programs/coe/.
---------------------------------------------------------------------------

    In May 2015, the FAA announced the UAS Focus Area Pathfinders
initiative,\23\ a partnership with industry to explore the next steps
in unmanned aircraft operations beyond the type of operations the
agency proposed in the small UAS NPRM. Three companies reached out to
the FAA to work on research to continue expanding use of UAS in the
nation's airspace in three focus areas: Visual line-of-sight operations
in urban areas; extended visual-line-of-sight operations in rural
areas; and beyond visual line-of-sight in rural/isolated areas. In
October 2015 a fourth Pathfinder initiative was added, testing
technology to identify small UAS operating around airports.
---------------------------------------------------------------------------

    \23\ http://www.faa.gov/uas/legislative_programs/pathfinders/.
---------------------------------------------------------------------------

    In September 2015, the FAA issued Advisory Circular 91-57A,\24\
Model Aircraft Operating Standards, replacing and superseding the
guidance provided in the now-cancelled Advisory Circular 91-57, issued
in 1981. The updated document provides guidance to persons operating
unmanned aircraft for hobby or recreation purposes meeting the
statutory definition of ``model aircraft'' contained in Section 336 of
the FAA Modernization and Reform Act (Public Law 112-95), and describes
means by which model aircraft may be operated safely in the NAS.
---------------------------------------------------------------------------

    \24\ https://www.faa.gov/documentLibrary/media/Advisory_Circular/AC_91-57A.pdf.
---------------------------------------------------------------------------

    In February 2016, the FAA convened an aviation rulemaking committee
(ARC) to provide recommendations for a performance-based standard that
would allow certain UAS to be operated over people. Previously
characterized as micro UAS in the NPRM for this final rule, this
category of operations will now be considered in a separate rulemaking.
The ARC submitted its recommendations to the FAA on April 2, 2016, and
the FAA is currently evaluating the recommendations. A copy of the
ARC's report is available in docket for this rulemaking, and more
information regarding the status of this new rulemaking may be found in
the Department's significant rulemakings report, available at
www.transportation.gov/regulations.

III. Discussion of the Final Rule

    As discussed in the previous section, in order to determine whether
certain UAS may operate safely in the NAS pursuant to section 333, the
Secretary must find that the operation of the UAS will not: (1) Create
a hazard to users of the NAS or the public; or (2) pose a threat to
national security. The Secretary must also determine whether small UAS
operations subject to this rule pose a safety risk sufficient to
require airworthiness certification. The following preamble sections
discuss the specific components of this rule, and section III.J
explains how these components work together and allow the Secretary to
make the statutory findings required by section 333.

A. Incremental Approach and Waiver

    In the NPRM, the FAA noted that this rulemaking is one step of a
broader process to fully integrate UAS into the NAS. ``Once the entire
integration process is complete, the FAA envisions the NAS populated
with UAS that operate well beyond the operational

limits proposed in [the NPRM].'' \25\ However, because higher-risk UAS
operations pose additional safety issues that require more time to
resolve, the FAA proposed to limit this rulemaking to small UAS
operations posing the least amount of risk so that the agency could
move to quickly issue a final rule integrating those operations into
the NAS. ``In the meantime, the FAA will continue working on
integrating UAS operations that pose greater amounts of risk, and will
issue notices of proposed rulemaking for those operations once the
pertinent issues have been addressed, consistent with the approach set
forth in the UAS Comprehensive Plan for Integration and FAA roadmap for
integration.\26\
---------------------------------------------------------------------------

    \25\ 80 FR at 9552.
    \26\ 80 FR at 9552. Section 332(a) of Public Law 112-95 requires
the Secretary of Transportation to develop a comprehensive plan to
safely accelerate the integration of civil UAS into the NAS. This
plan must be developed in consultation with representatives of the
aviation industry, Federal agencies that employ UAS technology in
the NAS, and the UAS industry. Section 332(a) also requires the
Secretary of Transportation to develop a 5-year roadmap for the
introduction of civil UAS into the NAS. Both the comprehensive plan
and the roadmap were published in November 2013.
---------------------------------------------------------------------------

    The FAA also acknowledged that new technologies could come into
existence after this rule is issued that could alleviate some of the
risk concerns underlying the provisions of this rulemaking. As such,
the FAA invited comment as to whether the final rule should include
some type of waiver authority (such as a letter of deviation or a
waiver) to better accommodate these new technologies. For the reasons
discussed below, the FAA has decided to proceed with an incremental
approach in this final rule but has added waiver authority to the
regulatory text in order to accommodate new technologies and unique
operational circumstances.
    A number of commenters, including NTSB, Airlines for America (A4A),
and the Small UAV Coalition, supported the FAA's proposed incremental
approach to issue a final rule immediately integrating low-risk UAS
operations into the NAS while continuing to work on integrating UAS
posing a higher risk in separate regulatory actions. Qualcomm
Incorporated, Google, Inc., the Oregon Department of Aviation, and the
North Dakota Department of Agriculture urged the FAA to move quickly to
issue a final rule integrating small UAS operations into the NAS.
Google emphasized that ``[a]s the [small UAS] industry evolves, any
lengthy delay in the issuance of a final [small UAS] rule would
substantially reduce the benefits of the final rule. It will be
difficult, if not impossible, for the FAA to adequately consider the
many likely technological developments during a protracted
rulemaking.'' The National Association of Flight Instructors added that
because UAS are a relatively new technology whose risks are still being
studied, the FAA should use ``a phased in set of regulations that ease
into basic use of [small UAS] in the NAS with close attention to the
degree of responsible use and compliance with regulations before
considering relaxation of rules to allow increasing capability of the
aircraft.''
    The Coalition of Airline Pilots Associations (CAPA) commented that
``creating a set of regulations and standards that have a lower level
of safety in the name of expedience is problematic.'' CAPA asserted
that this rulemaking ``is an opportunity to develop a regulatory
schema, using the hard lessons learned over the past one hundred years
that has the long-range vision to be capable and integrated to handle
the full spectrum of anticipated operations.'' CAPA also claimed that
there may ultimately be remotely piloted vehicles that are the size of
commercial transport category aircraft, and that any system put in
place to govern UAS must account for this eventuality and provide the
appropriate level of regulation. The Flight School Association of North
America recommended a 12 to 18-month extension to the rulemaking
timeline, ``so that more review can be accomplished.''
    Other commenters, including Amazon.com, Inc. (Amazon), the American
Farm Bureau Federation, and several state farm bureaus,\27\ raised
concerns about the proposed incremental approach. These and other
commenters, such as the U.S. Small Business Administration (SBA) Office
of Advocacy and the George Washington University Regulatory Studies
Center, argued that more flexibility is necessary in the final rule to
keep pace with new and emerging technologies. In addition, the
commenters asserted that by delaying the integration of certain
operations, such as beyond-visual-line-of-sight operations, until a
future rulemaking, the FAA would also delay the benefits associated
with those operations until the pertinent future rulemaking is
complete. The George Washington University Regulatory Studies Center
suggested that the FAA set regular deadlines for issuing future final
rules to further integrate UAS into the NAS.
---------------------------------------------------------------------------

    \27\ Some of these commenters include the Michigan Farm Bureau,
the Indiana Farm Bureau, the Louisiana Farm Bureau Federation, and
the South Dakota Farm Bureau Federation.
---------------------------------------------------------------------------

    To address these concerns, a number of commenters including the SBA
Office of Advocacy, the National Business Aviation Association (NBAA),
and Google, urged the FAA to include deviation authority in the final
rule. Google suggested that the FAA should grant a deviation from the
provisions of part 107 if an applicant can establish that his or her
small UAS operation would provide a level of safety equivalent to the
one provided by the operating parameters of part 107. Several
commenters including the National Ski Areas Association, EEI,\28\ and
the American Farm Bureau Federation (AFBF) asserted that there exist
industries (such as agriculture, electrical utilities, and ski resorts)
whose unique operating environments may allow them to mitigate some of
the safety concerns underlying the operational parameters of the NPRM
proposal. The Small UAV Coalition emphasized that the key to including
deviation authority in the final rule would be for the FAA to establish
a process by which it may authorize certain operations to exceed the
other provisions of part 107 based on case-specific characteristics
such as the operational circumstances of the mission, technological
capabilities of the small UAS, and the training and experience of the
operator.
---------------------------------------------------------------------------

    \28\ EEI, NRECA, and APPA submitted a joint comment to the
docket. For ease of reference, this preamble will refer to the joint
submission simply by the name of the first organization on the
letterhead, which is EEI.
---------------------------------------------------------------------------

    After considering the comments, the FAA has decided to proceed
incrementally and issue a final rule that immediately integrates the
lowest-risk small UAS operations into the NAS. As Qualcomm, Google, the
Oregon Department of Aviation, and other commenters pointed out,
delaying the integration of the lowest-risk small UAS operations until
issues associated with higher-risk operations have been addressed would
needlessly delay the realization of societal benefits associated with
integrating UAS operations for which the pertinent safety issues have
been addressed. In addition, the immediate integration of the lowest-
risk small UAS operations into the NAS would provide the FAA with
additional operational experience and data that could be used to assist
with the integration of higher-risk operations.
    However, the FAA also agrees with the SBA Office of Advocacy and
other commenters who pointed out that: (1) The rulemaking process for
higher-risk

UAS operations may lag behind new and emerging technologies; and (2)
certain individual operating environments may provide unique
mitigations for some of the safety concerns underlying this rule. To
resolve these issues, this rule will, in Sec.  107.200, include the
option to apply for a certificate of waiver. This certificate of waiver
will allow a small UAS operation to deviate from certain provisions of
part 107 if the Administrator finds that the proposed operation can
safely be conducted under the terms of that certificate of waiver. This
is similar to the standard that the FAA utilizes to consider waivers to
the requirements of 14 CFR part 91.\29\ A discussion as to whether a
provision of part 107 is waivable can be found in the preamble section
discussing that provision.
---------------------------------------------------------------------------

    \29\ See 14 CFR 91.903(a) (allowing a certificate of waiver from
part 91 requirements ``if the Administrator finds that the proposed
operation can be safely conducted under the terms of that
certificate of waiver'').
---------------------------------------------------------------------------

    To obtain a certificate of waiver, an applicant will have to submit
a request containing a complete description of the proposed operation
and a justification, including supporting data and documentation as
necessary, that establishes that the proposed operation can safely be
conducted under the terms of the requested certificate of waiver. The
FAA expects that the amount of data and analysis required as part of
the application will be proportional to the specific relief that is
requested. Similarly, the FAA anticipates that the time required for it
to make a determination regarding waiver requests will vary based on
the complexity of the request. For example, a request for a major
deviation from part 107 for an operation that takes place in a
congested metropolitan area with heavy air traffic will likely require
significantly more data and analysis than a request for a minor
deviation for an operation that takes place in a sparsely populated
area with minimal air traffic. If a certificate of waiver is granted,
that certificate may include additional conditions and limitations
designed to ensure that the small UAS operation can be conducted
safely.
    The certificate-of-waiver process will allow the FAA to assess
case-specific information concerning a small UAS operation that takes
place in a unique operating environment and consider allowing
additional operating flexibility that recognizes safety mitigations
provided by the specific operating environment. The FAA anticipates
that this process will also serve as a bridging mechanism for new and
emerging technologies; allowing the FAA to permit testing and use of
those technologies, as appropriate, before the pertinent future
rulemaking is complete.
    Like information collected from Sec.  333 exemptions, the FAA plans
to collect useful data derived from waiver application and issuance
such as what part 107 provisions have the greatest number of waiver
requests, what technology is being utilized to enhance safety, and what
safe operating practices are most effective. To evaluate the
effectiveness of operating practices, the FAA plans to compare the
mitigations imposed by waiver grants against accident and incident
reports and observations made as part of the FAA's oversight. For
example, an FAA inspector conducting an inspection of a small UAS that
is operating under a waiver will be able to observe potential safety
issues that may arise during the operation. This information will used
to assess risk and be shared with various organizations in the FAA to
inform policy decisions and rulemaking efforts.
    Some commenters requested authorization to deviate for specific
activities. For example, the National Rural Electric Cooperative
Association (NRECA) requested deviation authority for utility
maintenance and operations of UAS in electric cooperative power line
right-of-way corridors. The American Petroleum Institute (API)
requested deviation authority in circumstances in which environmental
protection and health and human safety issues are implicated. Princeton
University recommended that the rule include an option for universities
to certify that the aircraft is to be used for educational purposes and
poses no unreasonable danger to the public. Vail Resorts requested that
the FAA provide a vehicle for deviation authority through agency
practices that will enable ski areas to obtain authorization or
exemption from certain final rules.
    The FAA notes that the safety of a small UAS operation is a result
of that operation's operating parameters and not the purpose for which
the operation is conducted. For example, if a small UAS operation is
conducted at a remote ski resort, the safety-pertinent factor is not
that the operation is conducted for ski-area purposes, but that the
operation is conducted in a remote area. However, at this time, the FAA
does not have sufficient data to determine what (if any) operational
mitigations are included when a small UAS operation is conducted in a
given industry and how widespread those mitigations are within the
industry. To take the earlier example of ski areas, the FAA does not
have sufficient data to determine whether all ski areas are remotely
located and the density of manned-aircraft traffic near each ski area.
Accordingly, the FAA will evaluate operations seeking to go beyond the
baseline part 107 requirements on a case-by-case basis as part of its
evaluation of the waiver applications.
    Modovolate Aviation and Colorado Ski Country USA encouraged the FAA
to make available class exemptions under section 333 of Public Law 112-
95 if specific classes of small UAS cannot reasonably be accommodated
within the final rule. Similarly, DJI recommended that, where
technology or operating practice is widely available or known, the FAA
could issue guidance allowing its inspectors to routinely grant
deviation authority to all operators meeting certain standards rather
than evaluating individual requests for deviation. Another commenter
encouraged the FAA to consider issuing equipment-specific
authorizations or waivers based on specific technologies rather than
granting authorizations or waivers to specific operators flying
specific aircraft. An individual urged the FAA to set up a program to
let manufacturers self-certify that their aircraft models qualify for
exemption from applicable rules.
    The FAA notes that the Administrative Procedure Act imposes certain
requirements on agency rulemaking. When conducting a rulemaking, an
agency must, among other things, issue a notice of proposed rulemaking,
allow time for public comment, consider public comments, and issue a
final rule after consideration of public comments.\30\ As part of its
process to integrate UAS into the NAS, the FAA may, in the future,
consider categories of UAS and UAS operations, but absent changes to
the statute, the method by which the agency will integrate those
categories into the NAS will have to comply with the Administrative
Procedure Act. With regard to manufacturer self-certification, the FAA
notes that part 107 will not contain airworthiness certification
requirements and thus, there will be no part 107 requirement to which a
manufacturer could self-certify.\31\
---------------------------------------------------------------------------

    \30\ See 5 U.S.C. 553(b) and (c).
    \31\ Part 107 does require the remote pilot to conduct a
preflight check to ensure that the small UAS is in a condition for
safe operation, but the manufacturer would be unable to self-certify
for that requirement because a small UAS may become damaged after it
leaves the manufacturer's possession.
---------------------------------------------------------------------------

    NetMoby encouraged the FAA to circumscribe very specific rules
establishing standards for UAS deviation authority at the outset of the

UAS regulatory environment to avoid being immediately overwhelmed with
waiver requests and other requests for deviation authority. Google
proposed a specific process for the deviation authority. Google
explained that the FAA would be able to tailor different operational
restrictions, as appropriate, if a petitioner can demonstrate that: (i)
The small UAS has enhanced safety technology; (ii) the small UAS meets
a higher level of airworthiness or complies with a more detailed
maintenance and inspection protocol; or (iii) the small UAS operator
(pilot) has a higher level of pilot and small UAS operator
qualification, training, and/or certification than the proposed part
107 would require.
    As discussed earlier, the standard that an applicant seeking a
waiver will be required to meet is to demonstrate that his or her
proposed small UAS operation can safely be conducted under the terms of
a certificate of waiver. This waiver process is intended to allow for
case-specific mitigations that could take many different forms or
combinations. These mitigations could even be based on technology that
does not exist at this time. Because prescriptive requirements imposed
on the waiver process as part of this rulemaking may limit the FAA's
flexibility to consider new or unique operational circumstances and
safety mitigations, the FAA declines to add more prescriptive
requirements to this process.
    The International Air Transport Association urged the FAA to adopt
a final rule that allows for regular and systemic review to ensure the
appropriate level of regulation or oversight. The Agricultural
Retailers Association similarly recommended timely reauthorization of
the rules ``to mirror technological advances and risk mitigation.'' The
Virginia Department of Aviation asserted that the rules ``should be
reviewed as quickly as the safety data permits,'' which the commenter
estimated to be every 24 months ``until we achieve full integration of
the technology into the NAS.''
    Several commenters urged the FAA to specifically address the
timeline for implementation, so that the industry can prepare
appropriately. One individual questioned whether the FAA intends to
create a forecast for UAS ``rule evolution.'' Specifically, the
commenter questioned when the FAA expects to develop rules for UAS
greater than 55 pounds and what constraints the agency expects to put
on operations for these larger vehicles. Another individual recommended
the FAA set regular deadlines for issuing final rules to update UAS
integration standards, and commit to removing some of the requirements
(e.g., size, visual line of sight) by a date certain, unless experience
justified maintaining them.
    The FAA notes that it has issued a comprehensive plan and roadmap
laying out its long-term vision for UAS integration into the NAS. The
FAA is currently updating these documents with an FAA strategic plan
for UAS integration into the NAS.\32\
---------------------------------------------------------------------------

    \32\ http://www.faa.gov/uas/publications/.
---------------------------------------------------------------------------

    With regard to review of the rules once they are in place, the FAA
notes that Executive Order 13610 requires the FAA to review its
regulations to examine whether they remain justified and whether they
should be modified or streamlined in light of changed circumstances,
including the advent of new technologies. The FAA regularly conducts a
retrospective review of its regulations, and the regulations of this
rule will be no exception.

B. Discussion of the Applicable Statutory Framework

    The Mercatus Center at George Mason University and the Competitive
Enterprise Institute questioned the Department's reliance on Public Law
112-95, section 333 as the authority for the proposed rule. Both
commenters stated that Public Law 112-95, Sec.  332 includes Congress'
mandate to the FAA to promulgate rules for small UAS integration into
the NAS. The Competitive Enterprise Institute urged the Department to
clearly articulate why it is invoking section 333 authority, as opposed
to Sec.  332(b) authority, as the basis for this rulemaking.
    Section 332(b)(1) requires the Secretary to publish a final rule
allowing for the civil operation of small UAS in the NAS ``to the
extent the systems do not meet the requirements for expedited
authorization under section 333.'' Conversely, section 333(a) requires
the Secretary to determine whether certain UAS may operate safely in
the NAS ``before completion of the plan and rulemaking required by
section 332. . . .'' As part of the consideration under section 333,
section 333(b)(2) directs the Secretary to determine whether ``. . .
airworthiness certification under section 44704 of title 49, United
States Code is required for the operation of unmanned aircraft
systems.'' If the Secretary determines that certain UAS may operate
safely in the NAS, then section 333(c) requires the Secretary to
``establish requirements for the safe operation'' of those UAS in the
NAS.
    Because the statutory text of section 332(b)(1) applies only to
those UAS that do not meet the requirements of section 333, sections
332 and 333 cannot both apply to the same UAS. The Department is
pursuing this rulemaking under section 333 because section 333(b)(2)
allows it to find that airworthiness certification is not necessary for
small UAS that will be subject to this rule. As discussed in section
III.J.3 of this preamble, the Department has indeed found that
mandatory airworthiness certification is unnecessary to ensure the
safety or security of these types of small UAS operations. However,
unlike section 333(b)(2), section 332 does not contain a provision that
would allow the Department to find that airworthiness certification
should not be required for a small UAS. Because airworthiness
certification is normally a statutory requirement imposed by 49 U.S.C.
44704 and 44711(a)(1), the FAA would have to include an airworthiness
certification requirement in this rule if it were to conduct this
rulemaking under section 332 rather than section 333. This would impose
an additional requirement on small UAS whose operational parameters do
not pose a hazard to users of the NAS or a threat to national security.
    Matternet, Inc. argued that Public Law 112-95 compels the FAA to
develop a regulatory framework for unmanned aircraft systems, but does
not bind or limit the Agency to existing statutes concerning aviation,
or to decades-long aviation regulatory doctrines that, Matternet
asserted, do not apply to these new technologies. Furthermore,
Matternet argued that because Public Law 112-95, section 333 expressly
contemplates that ``certain unmanned aircraft systems [would] operate
safely in the NAS before completion of the plan and rulemaking required
by section 332,'' Congress gave the FAA a ``blank slate'' to create
small UAS regulations ``without any suggestion that existing statutes
or regulations would act as impediments to the rulemaking process.''
Matternet also stated that it ``is concerned that the FAA's proposal is
impeded by an apparent notion that statutes, regulations or doctrines
that were created decades ago to address manned aircraft operations are
mandated to apply to unmanned aircraft, without any safety or economic
rationale.''
    Matternet's argument that existing statutes and regulatory
doctrines are limited to manned aircraft operations is foreclosed by
precedent. In

Administrator v. Pirker,\33\ the NTSB considered the issue of whether
an unmanned aircraft is an ``aircraft'' within the meaning of FAA
statutes and regulations and whether it is subject to the existing FAA
regulations of part 91, which ``prescribes rules governing the
operation of aircraft.'' \34\ The NTSB found that the statutory and
regulatory definitions of aircraft are ``clear on their face'' and
``draw no distinction between whether a device is manned or unmanned.''
\35\ Thus, the NTSB concluded that the existing regulatory provision of
Sec.  91.13 (which prohibits careless or reckless operation of an
aircraft) apply to the unmanned aircraft operation that was at issue in
Pirker.\36\
---------------------------------------------------------------------------

    \33\ A copy of the Pirker decision can be found at: http://www.ntsb.gov/legal/alj/OnODocuments/Aviation/5730.pdf.
    \34\ 14 CFR 91.1(a).
    \35\ Pirker at 4-5.
    \36\ Pirker at 8-12.
---------------------------------------------------------------------------

    The FAA is also unpersuaded by Matternet's other argument that
Public Law 112-95 overturned all existing aviation statutes and
regulations, leaving the FAA with a ``blank slate'' for this
rulemaking. The Supreme Court has held that ``[w]hile a later enacted
statute . . . can sometimes operate to amend or even repeal an earlier
statutory provision . . . repeals by implication are not favored and
will not be presumed unless the intention of the legislature to repeal
[is] clear and manifest.'' \37\ The Court added that ``[w]e will not
infer a statutory repeal ``unless the later statute expressly
contradict[s] the original act or unless such a construction is
absolutely necessary in order that the words of the later statute shall
have any meaning at all.'' \38\ Implied repeals of a longstanding
statutory provision are particularly disfavored.\39\
---------------------------------------------------------------------------

    \37\ Nat'l Ass'n of Home Builders v. Defenders of Wildlife, 551
U.S. 644, 662 (2007) (internal citations and punctuation marks
omitted).
    \38\ Id.
    \39\ Andrus v. Glover Constr. Co., 446 U.S. 608, 618 (1980)
(noting ``the axiom that repeals by implication of longstanding
statutory provisions are not favored'').
---------------------------------------------------------------------------

    The aviation statutes at issue here were enacted in 1958 as part of
the Federal Aviation Act of 1958 (which created the Federal Aviation
Agency).\40\ Because these statutory provisions have been in place for
58 years, they are longstanding statutory provisions whose implied
repeal would be particularly disfavored. Many of the pertinent
regulatory provisions at issue in this rulemaking are similarly
longstanding. For example, the ``see and avoid'' requirement of Sec.
91.113(b) was created in 1968.\41\ Thus, for the reasons discussed
below, the FAA finds that, with the exception of 49 U.S.C. 44704 and
44711(a)(1), Public Law 112-95 did not repeal these existing statutes
and regulations.
---------------------------------------------------------------------------

    \40\ Federal Aviation Act of 1958, Public Law 85-726, 72 Stat.
731 (1958).
    \41\ Pilot Vigilance, 33 FR 10505, July 24, 1968.
---------------------------------------------------------------------------

    Section 333 of Public Law 112-95 directs the Secretary of
Transportation to determine whether certain UAS may operate safely in
the NAS and if so, to establish requirements for the safe operation of
such UAS in the NAS.\42\ With the exception of section 333(b)(2), which
allows the Secretary to determine whether the airworthiness-
certification requirements of 49 U.S.C. 44704 and 44711(a)(1) should be
imposed on certain UAS, section 333 does not expressly contradict any
existing statute or regulation. Furthermore, interpreting section 333
as repealing all prior aviation statutes and regulations is unnecessary
in order to give meaning to section 333, which simply directs the
Secretary to determine whether existing aircraft regulations prohibit
or otherwise burden certain UAS operations that could operate safely in
the NAS. If the Secretary determines that this is the case, then
section 333(c) directs the Secretary to make the appropriate changes to
the pertinent regulations. Because, with the exception of section
333(b)(2), section 333 can be given meaning without repealing other
existing aviation statutes or regulations, we decline Matternet's
suggestion that section 333 impliedly repeals those statutes or
regulations.
---------------------------------------------------------------------------

    \42\ Public Law 112-95, sec. 333(a) and (c).
---------------------------------------------------------------------------

    We also note that section 333(b)(2) provides further evidence that
Congress intended section 333 to work in conjunction with the existing
aviation statutes. This subsection provides the Secretary with
discretion to determine whether airworthiness certification is
necessary for UAS subject to this rule. The FAA normally does not
possess this discretion because 49 U.S.C. 44711(a)(1) requires
airworthiness certification for any civil aircraft that is operated in
air commerce. Subsection 333(b)(2) also expressly cross-references 49
U.S.C. 44704, which specifies the process by which the FAA may issue an
airworthiness certificate. If Congress had intended section 333 to
repeal all other aviation statutes and regulations, there would be no
need to cross-reference Sec.  44704 or explicitly give the Secretary
the power to determine whether airworthiness certification should be
required because a repeal of Sec.  44711(a)(1) and Sec.  44704 would
automatically remove the statutory constraints on FAA's airworthiness
certification discretion. Thus, interpreting section 333 as repealing
all other aviation statutes would also render meaningless the
Congressional directive in section 333(b)(2) for the Secretary to
determine whether the airworthiness certification requirements of
Sec. Sec.  44711(a)(1) and 44704 should be applied to UAS subject to
this rule.
    The North Dakota Department of Agriculture noted that the FAA has
authority over the NAS and requested clarification on how UAS
operations will operate in an interstate manner. In response, the FAA
notes that, as the North Dakota Department of Agriculture pointed out,
the FAA's authority extends over the entire national airspace
system.\43\ Thus, with the exception of operations discussed in section
III.C of this preamble, the provisions of part 107 will apply to small
UAS operations operating in any State or manner in the United States.
---------------------------------------------------------------------------

    \43\ See, e.g., Public Law 112-95, section 333(a) (directing the
Secretary of Transportation to determine whether certain UAS may
operate safely in the ``national airspace system'') (emphasis
added).
---------------------------------------------------------------------------

C. Applicability

    To integrate small UAS operations into the NAS, this rule will
create a new part in title 14 of the CFR: Part 107. The regulations of
part 107, which are tailored to address the risks associated with small
UAS operations, will apply to small UAS operations in place of certain
existing FAA regulations that impede civil small UAS operations.
Specifically, for small UAS operations, the requirements of part 107
will generally replace the airworthiness provisions of part 21, the
airman certification provisions of part 61, the operating limitations
of part 91, and the external load provisions of part 133.
    However, part 107 will not apply to all small UAS operations. For
the reasons discussed below, part 107 will not apply to: (1) Air
carrier operations; (2) international operations; (3) public aircraft
operations; (4) certain model aircraft; and (5) moored balloons, kites,
amateur rockets, and unmanned free balloons. Additionally, part 107
will allow current holders of an exemption issued under section 333 of
Public Law 112-95 to continue operating under the terms of their
exemption rather than under part 107.
1. Transporting Property for Compensation (Air Carrier Operations)
    The NPRM proposed to allow transportation of property provided it
is not done for compensation. The reasoning for the limitation on
accepting payment or compensation for such

transport is that, in general, when someone is transporting persons or
property by air for compensation, that person may be considered an
``air carrier'' by statute and would then be required to obtain OST
economic authority and additional FAA safety authority.\44\ Because the
traveling and shipping public have certain expectations of safety and
consumer protection when payment is exchanged for carriage, air
carriers are subject to both economic and safety regulations to
mitigate the risks to persons or non-operator-owned property on the
aircraft, including statutory requirements for liability insurance
coverage.
---------------------------------------------------------------------------

    \44\ See 49 U.S.C. 41101 (noting that an air carrier may provide
air transportation only if the air carrier holds a certificate
issued under this chapter [chapter 411--Economic Regulation of Air
Carrier Certificates] authorizing the air transportation), 49 U.S.C.
44705 (requiring the FAA Administrator to ``issue an air carrier
operating certificate to a person desiring to operate as an air
carrier when the Administrator finds, after investigation, that the
person properly and adequately is equipped and able to operate
safely under this part and the regulations and standards prescribed
under this part''), and 49 U.S.C. 44711(a)(4) (prohibiting a person
from operating as an air carrier without an air carrier operating
certificate). Air transportation is defined in 49 U.S.C. 40102(a)(5)
as ``foreign air transportation, interstate air transportation, or
the transportation of mail by aircraft.''
---------------------------------------------------------------------------

    The Department sought comment on whether the rule should go
further--that is, whether UAS should be permitted to transport property
for payment within the other proposed constraints of the rule, e.g.,
the ban on flights over uninvolved persons, the requirements for line
of sight, and the intent to limit operations to a confined area. The
Department also sought comment on whether a special class or classes of
air carrier certification should be developed for UAS operations.
    Commenters including NAAA, International Brotherhood of Teamsters,
and ALPA supported the proposed prohibition on carrying property for
compensation. These commenters generally asserted that allowing air
carrier operations at this time would be premature. NAAA stated that a
more stringent regulatory regime, including certification of the safety
of a small UAS for air carrier operations, should be developed before
air carrier operations are permitted. The International Brotherhood of
Teamsters stated that weakening the regulations before ``package
delivery technologies'' are proven safe and reliable could endanger not
only the public but also the warehouse and operational staff involved
in the loading and maintenance of small UAS. ALPA stated that until
there is a demonstrated safety record for UAS air carrier operations,
the Department should not authorize such operations.
    Other commenters, including FAST Robotics, NBAA, and Small UAV
Coalition argued that the FAA should permit such operations. Life Drone
argued that the final rule should allow small UAS to deliver ``medical
AED units'' to emergency and remote locations where there is little or
no risk of interference with the NAS. MAPPS requested a ``geospatial
exemption'' to allow companies to obtain air carrier services for
various geospatial sensors owned by those other than the small UAS
operator.
    The Small UAV Coalition, Matternet, and the Information Technology
and Innovation Foundation opposed the prohibition on the basis that
allowing a company to use a small UAS to transport property in
furtherance of the company's own business, but not for compensation, is
an arbitrary distinction. Matternet and the Small UAV Coalition argued
that there is no safety or economic rationale to justify allowing
property transport for business purposes but not for compensation. The
Information Technology and Innovation Foundation asserted that the
safety of goods transported by UAS does not depend on whether the UAS
operator receives payment. This commenter further stated that ``[the]
goal should be to optimize both safety and commercial value when it
comes to the integration of UAS into the NAS,'' but the prohibition on
air carrier operations places ``unnecessary restrictions on commercial
activity.''
    Matternet noted that UAS analysis shows that over 80% of goods
intended for delivery by UAS will be in the range of two kilograms or
less, and that the total weight of the small UAS, including payload,
will therefore be 6 kilograms or less. Thus, Matternet argued, the
safety risks associated with manned air carrier operations--where the
aircraft weighs considerably more and has significant fuel capacity,
and where the operation could impact people both on the aircraft and on
the ground--do not exist for unmanned air carrier operations. Google
and the Consumer Electronics Association also pointed out that most UAS
cargo delivery will consist of relatively low-weight items that create
minimal safety concerns.
    Google argued that UAS cargo operations are very similar to
operations that require external payloads, such as sensors or cameras,
and then noted that FAA has already authorized several small UAS
operators to carry such external payloads. Amazon and American Farm
Bureau Federation similarly noted that there are circumstances in which
FAA already permits certain commercial operations (e.g., aerial work
operations, crop dusting, banner towing, ferry or training flights, and
some transport of persons or property for compensation) without
requiring an air carrier certificate, and a similar carve-out should be
established for low-risk transport using small UAS.
    Pointing to the low risks associated with the transport of property
by small UAS under the operating limitations of the proposed rule,
Amazon, Matternet, American Farm Bureau Federation, and Michigan Farm
Bureau stated that an air carrier certification is not necessary for
small UAS air carrier operations. If, however, the Department
determines that some type of air carrier certification is required by
statute, those four commenters, the Small UAV Coalition, and
Continental Mapping suggested that the Department develop an
alternative certification process that is tailored to small UAS
operations.
    NBAA and UPS stated that FAA can ensure safe operations by defining
performance-based standards to enable transport of property for
compensation. For example, UPS suggested weight limitations for small
UAS involved in transporting property. AUVSI said risks could be
mitigated by compliance with industry standards for design and build
that would normally occur through the aircraft certification process.
Aviation Management noted that small UAS should be permitted to
transport property if they have received approval to do so--i.e.,
through compliance with an advisory circular or with an industry
standard for design and build, such as one developed by ASTM. The
Consumer Electronics Association and Small UAV Coalition pointed out
that companies that want to transport property by UAS for compensation
have powerful business incentives to ensure safe, efficient, and
complete operations.
    Other commenters, including NetMoby, FAST Robotics, and Planehook
Aviation Services, LLC (Planehook Aviation), said that a special class
of air carrier certification should be required for UAS to transport
property for payment. Planehook Aviation stated that, at a minimum, FAA
should create a ``common carriage certification'' that mirrors the care
and safety requirements for manned aviation under 14 CFR part 119.
    The Department has reviewed the comments and legal authorities that
govern the transport of property for compensation and has determined
that it is appropriate to allow some limited operations involving the
transport of property for compensation to be done

under the other provisions of part 107, as analyzed below.
    As noted earlier, in general when someone is transporting persons
or property by air for compensation, that person may be considered an
``air carrier'' by statute and would then be required to obtain
economic authority from the Office of the Secretary and additional FAA
safety authority. Historically, the FAA has also required, through
regulation, that certain commercial operators who may be transporting
people or property for compensation wholly within a State, and thus not
triggering the statutory requirements for air carriers, be certificated
and comply with heightened safety requirements, based on the
Administrator's authority in Sec.  44701(a)(5) to prescribe regulations
that are necessary for safety in air commerce. The rationale for this
is that even aircraft operating wholly within a State could be operated
in such a manner that directly affects, or may endanger safety in
foreign or interstate air commerce.
    In contrast, the FAA has also recognized that some commercial
operations should not be subject to these heightened operator
certification requirements and should be allowed to operate under the
general operating rules of 14 CFR part 91. Some examples of this
include student instruction, sightseeing flights conducted in hot air
balloons, and non-stop flights conducted within a 25-statute mile
radius of the airport of takeoff for the purpose of conducting
parachute operations, as well as certain helicopter flights conducted
within a 25-mile radius of the airport of takeoff.\45\ These exceptions
are narrow and well-defined, and must be conducted in accordance with
operating limitations set forth in Sec.  119.1(e) and 14 CFR part 91.
---------------------------------------------------------------------------

    \45\ See 14 CFR 119.1(e)(1-10).
---------------------------------------------------------------------------

    In light of our experience with certification of other commercial
operations, and with particular attention to the safe integration of
new technologies, applications that are emerging, and limited nature of
the transportation that could occur given the operating limits of the
final rule, the Department has determined that a similar exception from
air carrier operations for unmanned aircraft involving limited
transport of property for compensation is appropriate. As adopted, the
final rule provides immediate flexibility for remote pilots to engage
in the limited carriage of property by small UAS, provided that the
operations are conducted within a confined area and in compliance with
the operating restrictions of 14 CFR part 107. It does not, however,
allow individuals or corporations, acting as ``air carriers,'' to
engage in ``air transportation'' as those terms are defined in 49
U.S.C. 40102.\46\ As technology develops in the future, the Department
will evaluate the integration of more expansive UAS air carrier
operations into the NAS and will propose further economic and safety
regulations if warranted.
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    \46\ See 49 U.S.C. 40102(a)(2) (defining ``air carrier'') and
(a)(5) (defining ``air transportation'').
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    In order to not be considered ``air transportation,'' first, the
transport must occur wholly within the bounds of a state. It may not
involve transport between (1) Hawaii and another place in Hawaii
through airspace outside Hawaii; (2) the District of Columbia and
another place in the District of Columbia; or (3) a territory or
possession of the United States and another place in the same territory
or possession, as this is defined by statute as interstate air
transportation and would otherwise trigger the Department's statutory
requirements for air carrier operations. Thus, remote pilots may not
offer or conduct ``air transportation,'' in which goods move across
State or national borders. By statute and regulation, individuals
seeking to carry more than a de minimis volume of property moving as
part of a continuous journey over state, territorial, or international
boundaries are considered by the Department of Transportation to be
``air carriers'' engaging in ``air transportation.'' \47\ The
assessment of whether an operator is engaging in ``air transportation''
is specific to the facts and circumstances of each case. Generally, the
Department looks to how the transportation is being marketed and
offered to customers, whether the transporting entity has existing
aviation economic authority, and the extent to which the people or
goods are being transported as part of an inter- or multi-State
network.
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    \47\ See 49 U.S.C. 41101; 14 CFR 298.2.
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    Second, as with other operations in part 107, small UAS operations
involving the transport of property must be conducted within visual
line of sight of the remote pilot. While the visual-line-of-sight
limitation can be waived for some operations under the rule, the
restriction is a critical component of the Department's finding that
these part 107 operations do not warrant further safety or economic
authority at this time. The visual-line-of-sight restriction limits the
area of operation to a circle with only about a 1-mile radius around
the remote pilot in command, depending on the visibility conditions at
the time of the operation. This limited area of operation mitigates the