[Federal Register Volume 80, Number 190 (Thursday, October 1, 2015)]
[Rules and Regulations]
[Pages 59021-59032]
[FR Doc No: 2015-24950]

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Rules and Regulations
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Federal Register / Vol. 80, No. 190 / Thursday, October 1, 2015 /
Rules and Regulations

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 21 and 45

[Docket No.: FAA-2013-0933; Amdt. Nos. 21-98, 45-29]
RIN 2120-AK20

Changes to Production Certificates and Approvals

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: The FAA is amending certification procedures and marking
requirements for aeronautical products and articles. The amendment
requires production approval holders to identify an accountable manager
who is responsible for, and has authority over, their production
operations and serves as the primary contact with the FAA; allows
production approval holders to issue authorized release documents for
aircraft engines, propellers, and articles; permits production
certificate holders to manufacture and install interface components;
requires production approval holders to ensure that each supplier-
provided product, article, or service conforms to the production
approval holder's requirements and establish a supplier-reporting
process for products, articles, or services that have been released
from or provided by the supplier and subsequently found not to conform
to the production approval holder's requirements; removes the
requirement that fixed-pitch wooden propellers be marked using an
approved fireproof method; and changes the title of part 21 of title 14
of the Code of Federal Regulations. This amendment updates FAA
regulations to reflect the current global aeronautical manufacturing
environment, thereby promoting aviation safety.

DATES: Effective March 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 technical questions concerning
this action, contact Priscilla Steward or Robert Cook, Aircraft
Certification Service, Production Certification Section, AIR-112,
Federal Aviation Administration, 800 Independence Avenue SW.,
Washington, DC 20591; telephone<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>or telephone:<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>    For legal questions concerning this action, contact Benjamin
Jacobs, Office of the Chief Counsel, Regulations Division, Federal
Aviation Administration, 800 Independence Avenue SW., Washington, DC
20591; telephone:<PHONE_NUMBER>; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The Department of Transportation (DOT) is responsible for
developing transportation policies and programs that contribute to
providing fast, safe, efficient, and convenient transportation under
Sec.  101 of Title 49, United States Code (49 U.S.C.). The Federal
Aviation Administration (FAA, we, us, or our) is an agency of DOT. The
FAA has general authority to issue rules regarding aviation safety,
including minimum standards for articles and for the design, material,
construction, quality of work, and performance of aircraft, aircraft
engines, and propellers under 49 U.S.C. 106(g), 44104, and 44701.
    The FAA is amending its regulations governing certification
procedures for products and articles, and its requirements for
identification and registration marking. These changes improve the
quality standards applicable to manufacturers and help to ensure that
products and articles are produced as designed and safe to operate. For
those reasons, these amendments are a reasonable and necessary exercise
of our rulemaking authority and obligations.

I. Executive Summary

A. Purpose of the Regulatory Action

    This final rule changes certification and marking requirements for
products and articles. In particular, this final rule:
     Requires applicants for a production approval and
production approval holders (PAHs) to identify an accountable manager;
     Allows a production certificate (PC) holder to manufacture
and install interface components (IC) under certain conditions and
limitations;
     Clarifies that a PAH must ensure that each supplier-
provided product, article, or service conforms to the PAH's
requirements;
     Requires a PAH to establish a supplier-reporting process
for products, articles, or services released from or provided by a
supplier and subsequently found not to conform to the PAH's
requirements;
     Allows a PAH that establishes an FAA-approved process in
its quality system to issue authorized release documents (using FAA
Form 8130-3) for new and used aircraft engines, propellers, and
articles produced by that PAH; and
     Excludes fixed-pitch wooden propellers from the
requirement that a propeller, propeller blade, or propeller hub be
marked using an approved fireproof method.
    Regulations pertaining to certification requirements for products
and articles are in part 21 of Title 14 of Code of Federal Regulations
(14 CFR). Marking requirements are in 14 CFR part 45.
    This final rule requires applicants for a production approval and
production approval holders (PAHs) to identify an accountable manager
who is responsible for, and has authority over, a PAH's operations.
This individual would also serve as a PAH's primary contact with the
FAA. Additionally, this amendment requires PAHs to amend, where
applicable, the documents required by Sec. Sec.  21.135, 21.305, and
21.605 to reflect the appointment of an accountable manager.
    This final rule allows a production certificate \1\ (PC) holder to
manufacture

and install interface components (IC) under certain conditions and
limitations. This final rule defines an IC as an article that serves as
a functional interface between an aircraft and an aircraft engine,
between an aircraft engine and a propeller, or between an aircraft and
a propeller. Under this rule, an IC is designated as such by the type
certificate (TC) or the supplemental type certificate (STC) holder who
controls the approved design data for that article.
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    \1\ Section 21.1(b)(6) defines production approval as a document
issued by the FAA to a person that allows the production of a
product or article in accordance with its approved design and
approved quality system, and can take the form of a production
certificate, a PMA, or a TSO authorization.
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    This final rule clarifies that a PAH must ensure that each
supplier-provided product, article, or service conforms to the PAH's
requirements. This final rule also requires a PAH to establish a
supplier-reporting process for products, articles, or services released
from or provided by a supplier and subsequently found not to conform to
the PAH's requirements. A PAH's reporting system may require suppliers
to report nonconformances to the PAH directly, or to other suppliers in
the supply chain.
    This final rule allows a PAH that establishes an FAA-approved
process in its quality system to issue authorized release documents
(using FAA Form 8130-3) for new and used aircraft engines, propellers,
and articles produced by that PAH. This provision allows PAHs
privileges similar to those afforded European- and Canadian-approved
manufacturers.
    This final rule amends part 45 to exclude fixed-pitch wooden
propellers from the requirement that a propeller, propeller blade, or
propeller hub be marked using an approved fireproof method. This
exclusion allows manufacturers to mark their products in a practical
manner that takes account of the inherent nature of wooden propellers.
    This final rule amends the title of part 21 to include articles.
The title is now ``Certification Procedures for Products and
Articles.''

B. Summary of Costs and Benefits

    The provisions of this final rule (1) are minimal cost, (2) impose
no additional costs because the provisions clarify only, or are current
practice, or (3) are voluntary and therefore inherently cost-
beneficial. Our analysis described in the notice of proposed rulemaking
(NPRM) regulatory evaluation has not changed. The FAA received no
comments to the docket on the NPRM regulatory evaluation.

II. Background

    Part 21 of 14 CFR contains the FAA's regulations concerning
certification procedures for products, articles, and parts. Since the
FAA codified part 21 in 1964, it has been amended numerous times.
Additionally, the origins of many part 21 regulations can be traced to
the Civil Air Regulations codified in 1937.
    When part 21 was first codified, most manufacturers of aviation
products and articles had a small, local supplier base. Production
certificate holders oversaw the manufacture of replacement parts, and
the international market for aviation products was relatively small. As
a result, for many years the U.S. had few bilateral agreements with
other countries for the export and import of aviation products, and
these agreements were limited in scope.
    Today, aviation products are manufactured world-wide. The number of
suppliers has increased dramatically, and these suppliers manufacture
an increasing percentage of a given product or article. Furthermore,
due to the global nature of manufacturing, forming business
partnerships and agreements across large geographic areas is now a
common strategy to lower costs, share risks, and expand markets.
Manufacturers collaborate globally to reduce duplicate requirements for
shared suppliers. Accordingly, the international market for aviation
products and the production of replacement parts under parts
manufacturer approvals (PMAs) have increased dramatically.
    In recognition of these and other related considerations, the FAA
published an NPRM, Changes to Production Certificates and Approvals, on
February 27, 2014, 79 FR 11012. The NPRM proposed numerous rule changes
to part 21, primarily to subparts A (General) and G (Production
Certificates). For greater detail on the FAA's initial proposal,
including additional background information and a more complete
statement of the problem, refer to the NPRM.

III. Discussion of Public Comments and Final Rule

    In response to the FAA's NPRM, we received comments from 19
commenters, raising 32 issues. Commenters included aviation
manufacturers and equipment manufacturers, such as Boeing, Garmin,
General Electric, HEICO, Textron, Timken, and Williams International;
industry groups and associations, such as Aerospace Industry
Association (AIA), Aviation Suppliers Association (ASA), and
Modification and Replacement Parts Association (MARPA); and numerous
individuals. The comments covered five main topics and a range of
various responses to the rulemaking proposal, which are discussed in
more detail below.

A. Supplier Control

    This final rule makes two amendments to Sec.  21.137(c)(1) & (2).
First, as proposed, Sec.  21.137(c)(1), which previously required a PAH
to develop procedures to ensure that a supplier-provided product or
article conforms to its approved design, now also requires those
procedures to account for supplier-provided services. Second, as
proposed, the standard for supplier control is revised in both Sec.
21.137(c)(1) & (2) to require suppliers to furnish products, articles,
or services that conform to the PAH's requirements. Prior to this final
rule, supplier-provided goods and services had to conform to FAA-
approved design data.
    HEICO recommended amending the proposed Sec.  21.137(c)(1) to
include services provided to a design approval holder. The commenter
noted that many design approval holders outsource portions of the
overall design process and these `services' must also be properly
controlled. The commenter's recommendation is outside the scope of this
rulemaking, which focuses on production approvals and PAH activities,
and not on design approval certification activities. PAHs are not
responsible, under Sec.  21.137, for design approval holder activities.
    ASA and MARPA recommended that, in addition to requiring a PAH to
require suppliers to provide products, articles, or services to meet
the PAH requirements, the FAA should also continue to allow a PAH to
accept products, articles, or services that conform to the PAH's
approved design. The commenters' rationale was that this final rule
creates two separate rules with respect to conformity of products and
articles; one standard for when a company is acting as a supplier, and
another standard when it is acting as a distributor. The commenters
claimed that an entity functioning as a supplier to a PAH would be
required to ensure that the product or article conformed to the PAH's
requirements. However, if that same entity, operating as a distributor,
were to sell their products in the aftermarket as replacement parts,
for instance to a repair station or an air carrier, they would still be
required to ensure that the product or article conforms to its approved
design. Both commenters suggested that this situation could result in
confusion and unintended harm to suppliers, and recommended revising
proposed Sec.  21.137(c)(1) to allow products, articles, or services to
conform to either the PAH's requirements or the approved design.

    The FAA disagrees with the recommendation. With respect to the
commenters' claim that this final rule creates two separate rules for
suppliers and distributors in the aftermarket, we presume that the
commenters used the term ``aftermarket distributor'' to mean that the
distributor is acting as a supplier to an entity other than a PAH.
Regardless, this provision does not create two separate standards. All
suppliers to any purchaser continue to be bound by contract to the
terms of any relevant purchase order. In the case of suppliers to a
PAH, the final rule removes the requirement to report deliveries that
conform to the purchase order but do not conform to the PAH's final
approved design. Aftermarket distributors who are not suppliers, on the
other hand, are outside of the scope of part 21. The FAA does not
regulate aftermarket distributers under these regulations.
    The commenters also suggested that, under this final rule, a
supplier providing the same part with different specifications to both
a PAH and an aftermarket customer, such as a maintenance provider,
could be at risk of inadvertently sending design-conforming parts
(intended for the aftermarket customer) to a PAH, instead of parts that
met the PAH's unique specifications. The commenters suggested that the
supplier in that situation should not be punished for providing an
article that conforms to its approved design.
    The FAA disagrees with the comment that this change will punish any
supplier who provides nonconforming products, articles, or services.
This provision is not intended as a means to punish suppliers. The FAA
does not directly regulate suppliers; instead, this final rule requires
that a PAH's quality system include a supplier-reporting system. Under
this final rule, a PAH must establish procedures for supplier reporting
of supplier-provided products, articles, or services that deviate from
the requirements of the PAH's purchase order. This gives a PAH
flexibility to determine the appropriate level of reporting because it
is the PAH and only the PAH who knows what is needed, and in what
condition, for the production process. To clarify, this final rule does
not require a PAH to report to the FAA those supplier nonconformances
that remain within the PAH's quality system.
    Relatedly, ASA and MARPA stated that the proposed rule could
indirectly require a supplier to report nonconformance higher up the
supply chain, even when the supplier provided a product or article that
conformed to its approved design. The commenters again recommended that
the final rule allow suppliers to provide products or articles that
conform to either the PAH's requirements or the approved design.
    The FAA disagrees with the recommendation. This final rule replaces
the existing requirement that a supplier-provided product, article, or
service conform to the PAH's approved design with a requirement that it
conform to the PAH's requirements. The purpose of this amendment is to
tailor the regulation to its original intent. For example, a PAH may
issue a purchase order for sheet metal parts, and state on the purchase
order that the rivet holes are to be drilled to less than the finished
dimensions of the approved design. The PAH may request pilot drilling
by the supplier because the PAH will itself drill the holes to the
finished size upon assembly. If the supplier provides the items with
the holes drilled to the finished dimension, the sheet metal parts
would not conform to the PAH's requirements. The supplier would be
supplying nonconforming material even though it would conform to the
approved design. Under this final rule, therefore, a supplier may not
deviate from the requirements of the PAH. It is the PAH, and only the
PAH, that knows what is needed, and in what condition, for the
production process.
    An individual commenter stated that the NPRM changes the definition
of ``quality escape,'' as the phrase is used in Sec.  21.137(n), from
nonconforming products or articles which escaped a PAH's quality system
to products or articles which do not conform to their approved design
but are contained within the quality system. The commenter recommended
that we distinguish between nonconforming products or articles still
within the PAH's quality system, and nonconforming products or articles
that escape a PAH's quality control system.
    Section 21.137(n), which is not revised by this rule, addresses
quality escapes by requiring a PAH to have procedures for, among other
things, identifying and taking corrective action whenever a PAH
releases a nonconforming product or article from its quality system. In
our NPRM, we stated that this proposal would require a PAH to establish
a supplier reporting process for products, articles, or services that
have been released from a supplier and subsequently found not to
conform (hereafter referred to as a quality escape) to the PAH's
requirements. We believe the commenter's confusion derives from our use
of the term ``quality escape'' to describe the transfer of
nonconforming items or services between tiers in the supply chain,
instead of its traditional meaning of nonconforming products or
articles that leave a PAH's quality system. We acknowledge that our
preamble discussion in the NPRM used the term in a confusing manner.
However, we determine that no change to the terms of Sec.  21.137, as
originally proposed, are necessary. The reporting requirements of Sec.
21.137(c) apply when a supplier to a PAH determines that it has
released or provided a product, article, or service subsequently found
not to conform to the PAH's requirements, and do not include the phrase
``quality escape.''
    Boeing recommended that the FAA require PAHs to communicate design
change notifications throughout the supply chain, and adopt the
industry's SAE \2\ AS9016 standard for standardization of design change
notifications, because it believes this will address the single most
common reason for quality escapes from the supply chain.
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    \2\ Formerly known as the Society of Automotive Engineers.
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    The FAA disagrees with the recommendation to regulate PAHs' use of
SAE AS9016 because we believe this subject is adequately addressed by
our current regulation, Sec.  21.137(a), design data control, which
requires that only current, correct, and approved data is used. In
addition, we do not believe that we should mandate, by rule, the use of
an industry standard over which we have no control. This final rule
requires a PAH to ensure that any product, article, or service it
receives conforms to its requirements. If a PAH chooses, it may, as
part of a purchase order, require its supply-chain to adhere to the
AS9016 standard.
    Williams International stated that it is unnecessary to require a
PAH to report supplier nonconformances that remain contained within the
PAH quality system. Williams International further stated that the
proposed requirement for reporting of released nonconformances is
already required by a PAH. FAA Advisory Circular (AC) 00-58, Voluntary
Disclosure Reporting Program, further provides a means for a voluntary
disclosure of such releases.
    Although the commenter did not provide a recommendation, the FAA
disagrees with the commenter's premise. Before this final rule, a PAH's
supplier-reporting process required each supplier, at any tier, to
report to the PAH any product, article, or service that did not conform
to the PAH's FAA-approved design. The FAA recognizes that this
requirement had the potential to impose significant burdens on a PAH

and that, in many cases (such as suppliers of standard parts), a
supplier may not have known the ultimate customer. This final rule
amends Sec.  21.137(c) to provide every PAH greater flexibility to
determine which nonconformances its suppliers should report, and to
whom.
    An individual commenter suggested that all tiers in the supply
chain should report to a PAH any nonconforming products, articles, or
services that have been released from or provided by that supplier and
subsequently found not to conform to the PAH's requirements. More
specifically, the commenter suggested that the FAA require each
supplier, in some instances, to report a nonconformance to each level
up the supply chain, and ultimately to the PAH and the PAH's customer.
Another individual recommended the FAA keep the current regulation
which requires suppliers to report quality escapes to the PAH, and
provided no further rationale.
    The FAA disagrees with the commenters' recommendations. In the
past, a PAH's supplier-reporting system required every manufacturing
supplier and affected downstream suppliers to report to the PAH all
products or articles which did not meet the PAH's approved design, even
if those products or articles met the PAH's actual requirements. The
FAA recognizes that this past requirement could have imposed a
significant burden on PAHs, and this final rule is intended to maintain
safety while also providing PAHs with the flexibility to determine
which suppliers should report, and to whom.

B. Accountable Manager

    As the FAA proposed in the NPRM, this final rules amends Sec. Sec.
21.135, 21.305, and 21.605 to require a PAH to provide the FAA with a
document identifying the organization's accountable manager. The
accountable manager is responsible for, and has authority over, all
part 21 production activities. It is not the FAA's intent that this
provision dictates who is responsible for PAH production operations. It
is also not the FAA's intent that this provision imposes personal
liability for production operations on the accountable manager. The FAA
is simply requiring each PAH to identify for the FAA the individual or
individuals within the PAH's organization who the PAH considers
responsible for all production operations.
    Boeing, MARPA, and Timken Aerospace recommended that an accountable
manager have the ability to identify and delegate functions to
alternate points of contact. These commenters noted that the person
responsible for accountability may be a company president or chief
executive who cannot reasonably be available at all times. Allowing
delegation increases the FAA's access to the PAH and provides
redundancy in the event of personnel turnover, in accordance with the
intent of this final rule.
    The FAA agrees with the commenters with respect to delegation, but
determines that no change to the proposed rule language is necessary.
To clarify, the accountable manager may delegate functions and identify
alternate points of contact. These actions should be noted in the PAH's
organization document. Additional guidance may be found in FAA AC 21-
43, Issuance of Production Approvals Under Subparts G, K, & O.
    Boeing and an individual commenter requested that we revise the
rule to require two accountable managers--one for production activities
and one for design activities. These commenters claimed that two such
accountable managers would better reflect the various responsibilities
of PAH personnel, including those responsible for coordinating with FAA
manufacturing inspection district offices (MIDOs) and aircraft
certification offices (ACOs).
    The FAA disagrees with the commenters' recommendation. The
commenters are describing design-related activities and
responsibilities. Because the public was not provided an opportunity to
comment on an FAA requirement for an accountable manager for design
activities, the FAA considers the recommendation to be outside the
scope of this rulemaking. To clarify, the accountable manager described
in this rule is required only to have responsibility for production
operations, not design activities.
    Garmin International and Williams International stated that there
is no need for an accountable manager, and recommended instead a
requirement that the PAH identify an FAA point of contact. In addition,
Garmin stated that a better means to improve the FAA's access would be
to require a PAH to clearly indicate how its organization will
communicate. Williams recommended that if the FAA has difficulty
communicating with a particular PAH, that PAH should be required to
clarify its own existing procedures.
    The FAA disagrees with the commenters' recommendations. An
accountable manager is not simply a point of contact. When issuing an
approval or performing certificate management, the FAA must know who
from the PAH has the authority to speak for the PAH and ensure
compliance with all applicable regulatory requirements. Requiring a PAH
to identify such an individual, one who is knowledgeable of and
accountable for maintaining the PAH's FAA production approval, will
improve communication between the PAH and the FAA offices responsible
for certificate management of their production approval. A simple point
of contact would not create the same benefits.
    Universal Avionics Systems Corporation (UASC), Textron, and an
individual commenter suggested identifying the accountable manager as
the ``Quality Manager.'' Textron stated that the rule could be
misinterpreted as describing the PAH official in charge of production
operations, instead of the person who runs the quality system. UASC and
the individual commenter both observed that the FAA already requires
accountable managers for repair stations. The individual commenter
further stated that organizational differences between a typical PAH
and a typical repair station make identifying a general manager as an
accountable manager less appropriate for a PAH than for a repair
station. Finally, UASC recommended incorporating the definition of
``directly in charge'' from part 145 (Repair Stations) into part 21, to
better explain the role of ``accountable manager.'' UASC stated that it
believes the Accountable Manager is intended to be a quality person
whom may not have responsibility for and authority over production
operations.
    The FAA disagrees with the commenters' recommendations. Although
the FAA requires the establishment of a quality system as a
prerequisite to obtaining a production approval, nowhere do we require
a PAH to create an organizational position responsible solely for the
PAH's quality system. Moreover, under this rule, the accountable
manager must be at a sufficient level within the organization to have
responsibility over all production operations, not just the quality
system. For example, the accountable manager should have responsibility
for, among other things, formally applying to add a new product or
article to the PAH's production approval; formally requesting FAA
approval for a change in location; amending the PAH's organization
document and submitting that document to the FAA; ensuring support for
design approval holders, as required by Sec.  21.137(m); and formally
submitting

changes to the PAH's approved quality system.
    We also disagree with the commenters' comparisons of part 21 and
part 145 accountable managers. A PAH's accountable manager has
different duties and responsibilities from the accountable manager of a
repair station. Furthermore, the ``directly in charge'' definition from
part 145 does not apply to a PAH's accountable manager. We are not
requiring a PAH accountable manager to be ``directly in charge'' of the
work performed by the production organization.

C. Authorized Release Documents

    This final rule creates Sec.  21.137(o), which permits a PAH to
issue authorized release documents for new aircraft engines,
propellers, and articles manufactured by that PAH, and for used
aircraft engines, propellers, and articles rebuilt or altered in
accordance with Sec.  43.3(j), provided the PAH establishes and adheres
to certain quality assurance procedures as part of its quality system.
This final rule marks a slight change from what the FAA initially
proposed: In response to comments, we explicitly restrict each PAH to
issuing authorized release documents for products and articles
manufactured by the PAH itself.
    Boeing recommended that the FAA consider requiring PAH personnel
selected to issue authorized release documents to receive FAA training
equivalent to what is currently required for designees. The FAA
disagrees with the recommendation. Under this final rule, a PAH that
chooses to issue authorized release documents must establish a training
process for individuals the PAH selects to issue those documents. The
PAH may choose to send its personnel to FAA designee training (if
available), establish its own in-house training, or meet the
requirement in some other manner. The rule establishes minimum
requirements and permits the PAH to establish FAA-approved procedures
to meet those requirements.
    ASA stated that the rule does not give a PAH authority to issue FAA
Form 8130-3 because the term ``authorized release document'' is not
defined. The commenter also suggested changing the definition of
airworthiness approval to add Airworthiness approval means a document
issued by the FAA, or a person authorized by the FAA.
    The FAA disagrees with ASA's recommendations. As stated in Sec.
21.1(b)(1), an airworthiness approval is a document that must be issued
by the FAA. By this final rule, however, the FAA will now permit an
authorized PAH to issue authorized release documents, using an FAA Form
8130-3, for new aircraft engines, propellers, and articles, and for
used aircraft engines, propellers, and articles when rebuilt or altered
in accordance with Sec.  43.3(j). PAHs that intend to issue these
documents must detail the appropriate procedures in their quality
manual. To be clear, FAA regulations and policy distinguish between a
document issued by the FAA (an airworthiness approval) and one issued
by the PAH (an authorized release document). In addition, the latest
version of FAA AC 21-43, released concurrently with this final rule,
clearly states that a PAH should use FAA Form 8130-3 when issuing an
authorized release document.
    ASA recommended extending the privilege of issuing an authorized
release document beyond PAHs, to include distributors accredited in
accordance with FAA AC 00-56, Voluntary Industry Distributor
Accreditation Program. The commenter suggested that not doing so would
create a significant competitive disadvantage for certain American
businesses. More specifically, the commenter argued that failing to
allow non-manufacturing distributors to issue authorized release
documents would put those distributors at a competitive disadvantage.
    The FAA disagrees with the recommendation. The FAA cannot extend
this privilege to non-manufacturer distributors because they are not
recognized PAHs and, therefore, lack FAA-approved quality systems.
Quality systems are necessary to ensure that products and articles
conform to their approved design and are in a condition for safe
operation. The intent of this provision is to maintain the high level
of safety achieved under the prior rules, while allowing FAA-approved
PAHs to engage in a practice that is permitted by other authorities,
such as the European Union and Canada, for their PAHs.
    One individual commenter suggested that the FAA limit a PAH's
authority so that the PAH could only issue authorized release documents
for new or used aircraft engines, propellers, and articles that the PAH
itself manufactured under part 21.
    The FAA agrees with the commenter's proposal. Where a PAH was not
involved in manufacturing a product or article, the PAH may not have
the ability to make the appropriate conformity determination.
Accordingly, this final rule limits a PAH's authority to issue
authorized release documents to only those products and articles that
particular PAH has manufactured.
    Two individual commenters stated that allowing a PAH to issue Form
8130-3 as an authorized release document will reduce or be detrimental
to aviation safety. One of these commenters pointed out that, prior to
this final rule, FAA designees assigned to complete Form 8130-3 would
occasionally turn back parts and articles due to issues discovered
during the FAA conformity inspections. For that reason, the commenters
claimed that eliminating designees' continued, objective inspections
would reduce safety. Both commenters suggested keeping the current
system.
    The FAA disagrees with the commenters' characterization of how FAA
Form 8130-3 has been used previously, as well as their recommendations.
With respect to products and articles produced under a production
approval, issuance of an FAA Form 8130-3 indicates that that the
product or article conforms to its type design and is in a condition
for safe operation, unless otherwise specified. Even prior to this
rulemaking, FAA Form 8130-3 did not (and does not now) indicate that a
particular product or article has been inspected by the FAA or its
designee.
    Additionally, allowing a PAH, as opposed to an FAA employee or
designee, to issue FAA Form 8130-3 will not cause a decrease in safety.
Currently, Designated Manufacturing Inspection Representatives (DMIRs)
or Organization Designation Authorization (ODA) unit members issue the
vast majority of FAA Form 8130-3s. These designees are employed by the
PAH and authorized by the FAA, and the FAA requires them to possess at
least certain minimum qualifications and training, such as those
described in FAA Orders 8100.8, 8000.95 and 8100.15. Similarly, under
this final rule, any PAH seeking authority to issue FAA Form 8130-3
must first get FAA approval. As described in FAA AC 21-43, the FAA will
not approve a PAH to issue FAA Form 8130-3 unless the PAH demonstrates
that its authorized personnel possess the same qualifications and
receive training equivalent to what is required by FAA Orders 8100.8,
8000.95 and 8100.15 for FAA designees.
    Timken Aerospace suggested that allowing PAHs to issue authorized
release documents would add complexity to the existing process and
increase the FAA's workload. The commenter recommended instead
developing a system to assist PAHs in obtaining additional DMIRs.
    The FAA disagrees with the recommendation. The FAA anticipates that
permitting PAHs to issue authorized release documents will

reduce the workload of both the FAA and PAHs. Our intent is to
recognize a practice permitted by other authorities by giving FAA-
approved PAHs the same flexibility available to their European and
Canadian counterparts, who already issue authorized release documents.
For PAHs with an approved system for issuing authorized release
documents, the FAA will no longer authorize DMIRs or ODA unit members
to issue airworthiness approvals.
    Textron Aviation recommended that the FAA remove the regulatory
language in our 2014 NPRM proposing to allow the use of authorized
release documents for work performed under Sec.  43.3(j). The commenter
stated that this type of rebuilding work, and related use of FAA Form
8130-3, is already performed by PAH manufacturers.
    The FAA disagrees with the recommendation. The commenter is correct
that FAA Order 8130.21 allows certain entities to use FAA Form 8130-3
when returning to service rebuilt or altered engines, propellers, or
articles in accordance with Sec.  43.3(j). However, the FAA's final
rule codifies our authorization of that practice and extends the same
privilege to PAHs producing new aircraft engines, propellers, and
articles.
    Textron Aviation also claimed that FAA Order 8130.21 requires
authorized persons to document inspection activity on an FAA Form 8100-
1 when required by the managing office, and recommended revising either
Sec.  21.137 or FAA Order 8130.21 to indicate that a PAH is not
required to use FAA Form 8100-1 when issuing authorized release
documents.
    The FAA disagrees with both the commenter's claim and
recommendation. Neither our prior rules, nor this final rule, requires
a PAH to comply with the internal guidance in FAA Order 8130.21. More
specifically, Sec.  21.137(o) does not require any PAH to use FAA Form
8100-1 when issuing an FAA Form 8130-3. Furthermore, FAA Order 8130.21
does not require the use of FAA Form 8100-1, but an FAA managing office
may determine that a conformity inspection report is necessary to
substantiate an FAA-issued FAA Form 8130-3.
    One individual commenter stated that allowing a PAH to develop its
own procedures for signing authorized release documents will reduce or
eliminate the standardization that exists among designees. The
commenter recommended that requiring PAH personnel to take FAA training
would facilitate greater standardization.
    The FAA disagrees with the recommendation. When a PAH signs an
authorized release document, the PAH is not signing that document on
behalf of the FAA Administrator. The FAA requires any PAH that chooses
to issue authorized release documents to establish minimum procedures,
including training the employees responsible for issuing those
documents. These procedures will be reviewed and, if acceptable,
approved by the FAA, which will be conducive to standardization.
Ultimately, however, the current proposal gives each PAH the
flexibility to choose to send its personnel to FAA designee training
(if available), establish their own in-house training, or meet the
requirement in some other manner.

D. Definitions

    This final rule revises one definition and adds two new definitions
to Sec.  21.1. The definition of ``airworthiness approval,'' in Sec.
21.1(b)(1), is expanded to account for the issuance of an airworthiness
approval in instances where an aircraft, aircraft engine, propeller, or
article does not conform to its approved design or may not be in a
condition for safe operation at the time the airworthiness approval is
generated and that nonconformity or condition is specified on the
airworthiness approval document. In response to comments, we revised
the definition proposed in our NPRM to account for the fact that an
airworthiness approval may in some cases be issued for products or
articles that are not in a condition for safe operation, such as when
those products or articles are packed for shipment.
    As proposed, Sec.  21.1(b)(5) defines an ``interface component'' as
a functional interface between an aircraft and an aircraft engine, an
aircraft engine and a propeller, or an aircraft and a propeller.
Furthermore, an interface component is designated by the holder of the
type certificate or the supplemental type certificate who controls the
approved design data for that article. This definition is necessary
because this final rule also promulgates Sec.  21.147(c), which permits
a PAH to apply to the FAA to amend its production certificate to allow
the PAH to manufacture and install interface components. No change was
made to the definition in this final rule from the NPRM.
    Finally, as proposed, Sec.  21.1(b)(10) defines a ``supplier'' as
any person at any tier in the supply chain who provides a product,
article, or service that is used or consumed in the design or
manufacture of, or installed on, a product or article. This definition
is necessary to clarify existing FAA requirements. No change was made
to the definition in this final rule from the NPRM.
    Timken Aerospace and one individual commenter recommended we revise
our proposed airworthiness approval definition by moving ``unless
otherwise specified'' to be the final clause. In other words, these
commenters recommended changing the definition to a document which
certifies that the aircraft, aircraft engine, propeller, or article
conforms to its approved design and is in a condition for safe
operation, unless otherwise specified. The commenters noted, for
example, that an engine is not shipped from a factory in a complete and
final condition, since it is prepped for shipping, and is therefore not
in a condition for safe operation.
    The FAA agrees with the commenters' recommendation. There are many
instances in which the FAA issues an airworthiness approval but, at the
time of issuance, the product or article neither fully conforms to its
approved design, nor is it in a condition for safe operation. For
example, the FAA may issue an airworthiness approval for an aircraft
that has been disassembled for shipping, for an engine that has
preservation fluids installed prior to shipping, or for used aircraft
engines and propellers that are not in a condition for safe operation
(see Sec.  21.331, Issuance of export airworthiness approvals for
aircraft engines, propellers, and articles). We therefore revise the
definition of airworthiness approval to a document, issued by the FAA
for an aircraft, aircraft engine, propeller, or article, which
certifies that the aircraft, aircraft engine, propeller, or article
conforms to its approved design and is in a condition for safe
operation, unless otherwise specified.
    Also with respect to the airworthiness approval definition, Timken
Aerospace recommended we use the phrase ``except for deviations noted''
instead of ``unless otherwise specified,'' to be more consistent with
FAA Form 8130-9, Statement of Conformity.
    The FAA disagrees with the recommendation. The concept of
airworthiness is generally composed of two factors: Conformity with an
approved design and being in a condition for safe operation. In this
context, the term ``deviation'' would indicate a variation from an
approved design or quality system, but would not necessarily convey the
fact that a product is not in a condition for safe operation.
Accordingly, we determine that the phrase ``unless otherwise
specified'' more accurately reflects the intent of our proposal.

    Two individual commenters expressed concern that adding ``unless
otherwise specified'' to the definition of airworthiness approval would
change a fundamental premise of airworthiness approvals, that a product
or article must conform to its design. The commenters recommended that
the definition not be changed.
    The FAA disagrees with the commenters. The issuance of an
airworthiness approval, such as an export certificate of airworthiness,
does not necessarily mean that a product is airworthy. FAA regulations,
such as Sec.  21.331, allow FAA personnel and designees to issue an
airworthiness approval for a product or article that does not conform
to its approved design, as long as the nonconforming condition is
stated on the approval document and, in the case of export, the
receiving authority agrees to accept the product or article as
described. This final rule, therefore, simply brings the definition of
Airworthiness Approval in line with current FAA practice and with part
21, subpart L. Contrary to the commenters' suggestion, we are not
changing the fundamental concept of airworthiness. Under current
practices, an airworthiness approval is a means to show that the
product or article conforms to its approved design and is in a
condition for safe operation, unless otherwise specified.
    One individual commenter stated that the definition of ``supplier''
is overbroad because it includes distributors of commercial off the
shelf parts or parts not originally manufactured for aviation use. The
same commenter also stated that the addition of the term ``at any
tier'' will cause inconsistent and disparate interpretation within the
FAA and undue burden to industry. The commenter did not provide any
recommendations.
    The FAA recognizes that by including the term ``at any tier,'' the
proposed definition of ``supplier'' applies to all suppliers throughout
the supply chain. Contrary to the commenter's statement, the FAA
believes including suppliers ``at any tier'' will reduce
inconsistencies by confirming that the FAA definition of ``supplier''
applies to all suppliers, regardless of their position within the
supply chain. Furthermore, the FAA does not believe this definition
will unduly burden industry. To the extent that a supplier has only a
tenuous connection to a PAH, perhaps because the supplier produces
parts that are not specifically designed for use in aviation, it may be
appropriate for the PAH to account for that attenuation when designing
its supplier-reporting protocols. A PAH has always been responsible for
assuring that its products and articles conform and are in a condition
for safe operation. The inclusion of all suppliers within the
regulatory definition of supplier should therefore impose no additional
burden on either the PAH or its suppliers.
    The same individual commenter also stated that there is no guidance
for the suppliers of off-the-shelf parts, described above, who may not
anticipate that their parts will be used or installed on type
certificated aircraft and approved.
    The FAA agrees with the commenter's observation that there is no
guidance provided specifically for distributors of parts not originally
manufactured for aviation use or installation on type certificated
aircraft and approved under Sec.  21.8(c). The FAA provides guidance to
PAHs, repair stations, and other FAA-regulated entities. The FAA does
not provide guidance for entities that fall outside the scope of FAA
regulations.

E. Interface Components

    As proposed, Sec.  21.147(c) now permits a PAH to apply to the FAA
for an amendment to the PAH's production limitation record (PLR),
authorizing the PAH to manufacture and install interface components. If
granted, the FAA will amend the PAH's PLR to add the interface
components (IC). ICs are defined in the new Sec.  21.1(b)(5). The FAA
had previously granted exemptions to engine manufacturers, allowing
them to manufacture and install airframe components that interface
between the engine and the airframe, provided the engine manufacturer
owned or licensed the ICs design and installation data.
    Boeing and General Electric supported the rule change. Boeing also
suggested the FAA allow engine manufacturers to install and certify
airplane manufacturers' ICs during the engine type certification
process.
    The FAA disagrees with this recommendation as it is outside the
scope of this rulemaking. Allowing engine manufacturers to install and
certify airplane manufacturers' ICs during the engine TC process is a
design issue, not a production issue. Our 2014 NPRM and this final rule
focus on amendments to the production approval provisions in subpart G.
    Williams International recommended that our final rule distinguish
between all potential ICs versus those that are licensed to be both
manufactured and installed by a PAH. The commenter suggested that
defining ICs more narrowly would enable the FAA to include fewer items
on the PAH's PLR, and as a result would require fewer PLR updates and
impose less of a burden on the FAA.
    The FAA agrees with the concerns raised byWilliams International,
but we have determined that the rule as drafted adequately addresses
these concerns. Under Sec. Sec.  21.1(b)(5) and 21.147(c), a component
must meet certain criteria before it is considered an ``interface
component'' eligible for the PAH's PLR. For example, Sec.  21.1(b)(5)
requires, among other things, that an IC be designated as such by the
TC or STC holder. The rule requires only those ICs the PAH intends to
produce be listed on the PLR and not all possible ICs, so the PLR
should not be an exhaustive list or a burden on the FAA.

F. Miscellaneous Issues

    HEICO requested that the FAA define authorized release documents,
to establish who is issuing the document. The FAA disagrees with the
recommendation. The FAA does not believe it is necessary to provide a
definition in the text of the rule. The FAA provides additional
guidance on authorized release documents in the revised AC 21.43,
Appendix B, which is applicable to any PAH.
    One individual commenter stated that the title of the NPRM did not
reflect recent changes from parts to articles in our 2009 final rule,
Production and Airworthiness Approvals, Part Marking, and Miscellaneous
Amendments, 74 FR 53384 (Oct. 16, 2009). The commenter recommended
changing the title of part 21 to ``Certification Procedures for
Products, Articles, and Parts.'' The FAA partially agrees with the
recommendation and this final rule changes the title of part 21 to
``Certification Procedures for Products and Articles.''
    HEICO requested that we revise FAA Form 8130-3 attached as Appendix
A, Figure A-1 to FAA Order 8130.21 to explicitly indicate who,
including a PAH, is allowed to issue the document. The FAA disagrees
with HEICO's recommendation to revise the form. Instead, we have
revised FAA Order 8130.21 and ACs 21-43 and 21-44 to reflect the rule
change allowing a properly authorized PAH to issue an authorized
release document. In the ACs we also provide guidance to on how to
complete FAA Form 8130-3.
    Textron Aviation recommended that the FAA remove the requirement
for the issuance of export airworthiness approvals for articles,
believing that this change would better align FAA regulations with
those of foreign authorities. The recommendation is outside the scope
of this rulemaking. The FAA notes that the requirements for

the issuance of export airworthiness approvals for articles are
contained in subpart L. Although the FAA proposed allowing PAHs to
issue authorized release documents in Sec.  21.137, the proposal did
not change the conditions specified in subpart L.

IV. Regulatory Notices and Analyses

A. Regulatory Evaluation

    Changes to Federal regulations must undergo several economic
analyses. First, Executive Orders 12866 and 13563 direct that each
Federal agency shall propose or adopt a regulation only upon a reasoned
determination that the benefits of the intended regulation justify its
costs. Second, the Regulatory Flexibility Act of 1980 (Pub. L. 96-354),
as codified in 5 U.S.C. 603 et seq., requires agencies to analyze the
economic impact of regulatory changes on small entities. Third, the
Trade Agreements Act (Pub. L. 96-39), as amended by the Uruguay Round
Agreements Act (Pub. L. 103-465), prohibits agencies from setting
standards that create unnecessary obstacles to the foreign commerce of
the United States. In developing U.S. standards, the Trade Act requires
agencies to consider international standards and, where appropriate,
that they be the basis of U.S. standards. Fourth, the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4), as codified in 2 U.S.C. 1532,
requires agencies to prepare a written assessment of the costs,
benefits, and other effects of proposed or final rules that include a
Federal mandate likely to result in the expenditure by State, local, or
tribal governments, in the aggregate, or by the private sector, of $100
million or more annually (adjusted for inflation with base year of
1995). This portion of the preamble summarizes the FAA's analysis of
the economic impacts of this final rule.
    Department of Transportation Order DOT 2100.5 prescribes policies
and procedures for simplification, analysis, and review of regulations.
If the expected cost impact is so minimal that a proposed or final rule
does not warrant a full evaluation, this order permits that a statement
to that effect and the basis for it be included in the preamble if a
full regulatory evaluation of the costs and benefits is not prepared.
Such a determination has been made for this final rule. The reasoning
for this determination follows.
    As summarized in the table below, the provisions of this final rule
(1) are minimal cost, (2) will impose no additional costs because the
provisions will clarify only, or are current practice, or (3) are
voluntary and therefore inherently cost-beneficial. Our determination
has not changed from that made in the NPRM regulatory evaluation. The
FAA received no comments to the docket on the NPRM regulatory
evaluation. More detailed explanations follow the table.

------------------------------------------------------------------------
              Provision                          Costs/Benefits
------------------------------------------------------------------------
Require Identification of Accountable  Minimal cost--Requires
 Manager                                identification of an existing
                                        manager, who is responsible for
                                        and has authority over a
                                        Production Approval Holder
                                        (PAH)'s operations, as a PAH's
                                        primary contact with the FAA.
Allow PC Holders to Manufacture and    Codifying the practice,
 Install Interface Components.          previously allowed by exemption,
                                        will reduce regulatory
                                        compliance costs.
Modify Supplier Control Requirements.  No additional cost--Clarifies
                                        existing requirement that PAHs
                                        are responsible for conformity
                                        throughout their supply chains
                                        and gives PAHs flexibility in
                                        establishing a supplier-
                                        reporting process for
                                        nonconforming releases.
Allow PAHs to Issue Authorized         Voluntary, so expected benefits
 Release Documents for Aircraft         will exceed expected costs.
 Engines, Propellers and Articles.
Exclude Fixed-Pitch Wooden Propellers  The FAA found the exemption
 from Fireproof Marking Requirements.   provides an equivalent level of
                                        safety. Codifying the practice,
                                        previously allowed by exemption,
                                        will reduce regulatory
                                        compliance costs.
------------------------------------------------------------------------

 1. Require Identification of an Accountable Manager
    Under this provision, the FAA will require each applicant for, or
holder of, a Production Certificate (PC), Parts Manufacturer Approval
(PMA), or Technical Standard Order (TSO) authorization to identify an
accountable manager, who is responsible for, and has authority over, a
PAH's operations, as a PAH's primary contact with the FAA. This
provision is not intended to require the PAH to create a new position
within its organization and will not mandate that an individual in a
specific position be identified as the accountable manager.
Consequently, the costs, if any, associated with this requirement are
minimal.
2. Allow Production Certificate Holders To Manufacture and Install
Interface Components
    PC holders previously could not install interface components (ICs)
on their type-certificated products without an exemption. Previous
regulations governing the production limitation record and the
amendment of PCs restricted the PC holder to the manufacture of
products only (aircraft, aircraft engines, or propellers) and did not
authorize installation.\3\ The FAA has granted exemptions to engine
manufacturers, allowing them to manufacture and install airframe
components that interface between the engine and the airframe provided
they own or are licensed to use the IC type design and installation
data. In granting these exemptions, the FAA found that allowing engine
manufacturers to produce and install ICs improved safety and efficiency
by eliminating disassembly, reassembly and retesting, as well as
related scoring of fatigue sensitive parts; damage to critical parts;
and air/fuel/oil leaks.\4\ This provision will codify the practice,
previously allowed by exemption, of allowing PC holders to manufacture
and install ICs, and will apply to any articles designated by the TC
holder that interface between products. Therefore, this provision
applies to the interface between propeller and aircraft engine and
between propeller and aircraft, as well as between aircraft engine and
aircraft.
---------------------------------------------------------------------------

    \3\ Before 2010, Sec. Sec.  21.142 (production limitation
record) and 21.147 (amendment of production certificates) were
codified at Sec. Sec.  21.151 and 21.153, respectively.
    \4\ The production and installation of ICs by engine
manufacturers also increase efficiency by allowing delivery of
quick-change replacement engines to end users such as air carriers
and charter operators. Some piece parts (or kits), such as the
engine buildup unit (EBU), rather than being installed by the PC
holder, may be shipped separately to an aircraft manufacturer for
the purpose of just-in-time manufacturing operations, or to an
airline that may want kits on hand for routine maintenance
operations or to replace hardware damaged during operations.
---------------------------------------------------------------------------

    Codifying the previous practice of allowing PC holders to
manufacture and install ICs implies no change in safety

benefits. Codifying the practice, however, will reduce regulatory costs
since paperwork requirements involved in periodic application for and
granting of exemptions will be eliminated.
3. Modification of Supply Control
    With this provision, the FAA intends to clarify existing
requirements that the PAH is responsible for (1) conformity throughout
the supply chain and (2) establishing a supplier reporting process for
nonconforming releases. As there was no definition of supplier in the
previous regulations, the final rule defines supplier as a person that
provides a product, article, or service at any tier in the supply chain
that is used or consumed in the design or manufacture of, or installed
on, a product or article.
    The final rule changes the language to Sec.  21.137(c) as shown in
the following table:

------------------------------------------------------------------------
         Previous rule language                Final rule language
------------------------------------------------------------------------
Supply Control--Procedures that (1)      Supply Control--Procedures that
 Ensure that each supplier-furnished      (1) Ensure that each supplier-
 product or article conforms to its       provided product, article, or
 approved design; and                     service conforms to the
                                          product approval holder's
                                          requirements; and
(2) Require each supplier to report to   (2) Establish a supplier
 the production approval holder if a      reporting process for
 product or article has been released     products, articles or services
 from that supplier and subsequently      that have been released from
 found not to conform to the applicable   the supplier and subsequently
 design data.                             found not to conform to the
                                          production approval holder's
                                          requirements.
------------------------------------------------------------------------

    As provision (1) clarifies the FAA's intent and current practice
and provision (2) gives PAHs greater flexibility, there will be no
additional cost resulting from these provisions.
4. Allow Production Approval Holders To Issue Authorized Release
Documents for Aircraft Engines, Propellers, and Articles
    Previously, only the FAA was allowed to document that an aircraft
engine, propeller, or article conforms to its approved design and is in
condition for safe operation. The FAA provides documentation with an
airworthiness approval, using FAA Form 8130-3, ``Authorized Release
Certificate, Airworthiness Approval Tag.'' This provision allows, but
does not require, qualified PAHs to issue authorized release documents,
using FAA Form 8130-3, for aircraft engines, propellers, and articles
for which the PAH has a production approval. We refer to the issuance
of Form 8130-3 by a PAH as an ``authorized release document'' because,
as defined by 14 CFR 21.1(b)(1), only the FAA is allowed to issue an
airworthiness approval. PAHs choosing not to issue these authorized
release documents may continue to obtain approvals from the FAA.
    Although such airworthiness documentation is required only when
requested by a foreign civil aviation authority, it has become
increasingly valued in the aviation industry. Several U.S.
manufacturers have requested the privilege to issue such documentation,
which is already enjoyed by their European and Canadian counterparts.
As it is voluntary, this provision is inherently cost beneficial.\5\
---------------------------------------------------------------------------

    \5\ For aircraft, an export airworthiness approval will continue
to be issued only by the FAA, using Form 8130-4, ``Export
Certificate of Airworthiness.''
---------------------------------------------------------------------------

5. Marking of Fixed-Pitch Wooden Propellers
    As noted in the preamble above, the FAA granted an exemption to
Sensenich Wood Propeller Company from the regulations requiring that a
propeller, propeller blade, or propeller hub be marked using an
approved fireproof method. In granting the exemption, the FAA found
that stamping the hub of the propeller with the identification markers
will achieve an equivalent level of safety to the rule. The FAA
maintains that finding in this final rule and, in any case, codifying
the practice, previously allowed by exemption, implies no change in
safety benefits.\6\ Codifying the practice, however, will reduce
regulatory costs since the costs of paperwork requirements involved in
periodic application for and granting of the exemptions will be
eliminated.
---------------------------------------------------------------------------

    \6\ Variable-pitch wooden propellers do not require exception
from the fireproof marking requirement since they have metal hubs.
---------------------------------------------------------------------------

    The FAA made this minimal cost determination for the proposed rule.
As no comments were received, the FAA concludes the expected cost is
minimal.

B. Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA)
establishes as a principle of regulatory issuance that agencies shall
endeavor, consistent with the objectives of the rule and of applicable
statutes, to fit regulatory and informational requirements to the scale
of the businesses, organizations, and governmental jurisdictions
subject to regulation. To achieve this principle, agencies are required
to solicit and consider flexible regulatory proposals and to explain
the rationale for their actions to assure that such proposals are given
serious consideration. The RFA covers a wide-range of small entities,
including small businesses, not-for-profit organizations, and small
governmental jurisdictions.
    Agencies must perform a review to determine whether a rule will
have a significant economic impact on a substantial number of small
entities. If the agency determines that it will, the agency must
prepare a regulatory flexibility analysis as described in the RFA.
    However, if an agency determines that a rule is not expected to
have a significant economic impact on a substantial number of small
entities, section 605(b) of the RFA provides that the head of the
agency may so certify and a regulatory flexibility analysis is not
required. The certification must include a statement providing the
factual basis for this determination, and the reasoning should be
clear.
    The provisions of this final rule (1) are minimal cost, (2) would
impose no additional costs because the provisions would clarify only,
or are current practice, or (3) are voluntary. We received no comments
regarding our determination that there was no significant impact on a
substantial number of small entities in the NPRM.
    Therefore, as provided in section 605(b), the head of the FAA
certifies that this final rule will not have a significant economic
impact on a substantial number of small entities.

C. International Trade Impact Assessment

    The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal
agencies from establishing standards or engaging in related activities
that create unnecessary obstacles to the foreign commerce of the United
States. Pursuant to these Acts, the

establishment of standards is not considered an unnecessary obstacle to
the foreign commerce of the United States, so long as the standard has
a legitimate domestic objective, such as the protection of safety, and
does not operate in a manner that excludes imports that meet this
objective. The statute also requires consideration of international
standards and, where appropriate, that they be the basis for U.S.
standards.
    The FAA has assessed the potential effect of this final rule and
determined that the rule's provision allowing PAHs to issue authorized
release documents for purposes of export would be in accordance with
the Trade Agreements Act as this provision uses European standards as
the basis for United States regulation. The remaining provisions have a
minimal domestic impact only and therefore no effect on international
trade.

D. Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (Public Law
104-4) requires each Federal agency to prepare a written statement
assessing the effects of any Federal mandate in a proposed or final
agency rule that may result in an expenditure of $100 million or more
(in 1995 dollars) in any one year by State, local, and tribal
governments, in the aggregate, or by the private sector; such a mandate
is deemed to be a ``significant regulatory action.'' The FAA currently
uses an inflation-adjusted value of $155 million in lieu of $100
million. This final rule does not contain such a mandate; therefore,
the requirements of Title II of the Act do not apply.

E. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires
that the FAA consider the impact of paperwork and other information
collection burdens imposed on the public. The FAA has determined that
there is no new requirement for information collection associated with
this final rule.

F. International Compatibility and Cooperation

    In keeping with U.S. obligations under the Convention on
International Civil Aviation, it is FAA policy to conform to
International Civil Aviation Organization (ICAO) Standards and
Recommended Practices to the maximum extent practicable. The FAA
reviewed the corresponding ICAO Standards and Recommended Practices and
identified no differences with these regulations.
    Executive Order 13609, Promoting International Regulatory
Cooperation, promotes international regulatory cooperation to meet
shared challenges involving health, safety, labor, security,
environmental, and other issues and to reduce, eliminate, or prevent
unnecessary differences in regulatory requirements. The FAA analyzed
this action under the policies and agency responsibilities of Executive
Order 13609, and determined that this action has no significant effect
on international regulatory cooperation. To the extent that this final
rule may conflict with the implementing protocols of any FAA bilateral
aviation safety agreements, the FAA will amend those protocols in
coordination with our international partners.

G. Environmental Analysis

    FAA Order 1050.1E identifies FAA actions that are categorically
excluded from preparation of an environmental assessment or
environmental impact statement under the National Environmental Policy
Act in the absence of extraordinary circumstances. The FAA has
determined this rulemaking action qualifies for the categorical
exclusion identified in paragraph 312f and involves no extraordinary
circumstances.

V. Executive Order Determinations

A. Executive Order 13132, Federalism

    The FAA has analyzed this final rule under the principles and
criteria of Executive Order 13132, Federalism. The agency determined
that this action will not have a substantial direct effect on the
States, or the relationship between the Federal Government and the
States, or on the distribution of power and responsibilities among the
various levels of government, and, therefore, does not have Federalism
implications.

B. Executive Order 13211, Regulations That Significantly Affect Energy
Supply, Distribution, or Use

    The FAA analyzed this final rule under Executive Order 13211,
Actions Concerning Regulations that Significantly Affect Energy Supply,
Distribution, or Use (May 18, 2001). The agency has determined that it
is not a ``significant energy action'' under the executive order and it
is not likely to have a significant adverse effect on the supply,
distribution, or use of energy.

VI. How To Obtain Additional Information

A. Rulemaking Documents

    An electronic copy of a rulemaking document may be obtained by
using the Internet by--
    1. Search the Federal eRulemaking Portal (http://www.regulations.gov);
    2. Visit the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies/ or
    3. Access the Government Printing Office's Web page at http://www.gpo.gov/fdsys/.
    Copies may also be obtained by sending a request (identified by
notice, amendment, or docket number of this rulemaking) to the Federal
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence
Avenue SW., Washington, DC 20591, or by calling<PHONE_NUMBER>.

B. Comments Submitted to the Docket

    Comments received may be viewed by going to http://www.regulations.gov and following the online instructions to search the
docket number for this action. Anyone is able to search the electronic
form of all comments received into any of the FAA's dockets by the name
of the individual submitting the comment (or signing the comment, if
submitted on behalf of an association, business, labor union, etc.).

C. Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of
1996 requires FAA to comply with small entity requests for information
or advice about compliance with statutes and regulations within its
jurisdiction. A small entity with questions regarding this document,
may contact its local FAA official, or the person listed under the FOR
FURTHER INFORMATION CONTACT heading at the beginning of the preamble.
To find out more about SBREFA on the Internet, visit http://www.faa.gov/regulations_policies/rulemaking/sbre_act/.

List of Subjects

14 CFR Part 21

    Aircraft, Aviation safety, Exports, Imports, Reporting and
recordkeeping requirements.

14 CFR Part 45

    Aircraft, Exports, Signs and symbols.

The Amendment

    In consideration of the foregoing, and under the authority of 49
U.S.C. 106(f) and 44701(a)(5), the Federal Aviation Administration
proposes to amend

chapter I of title 14, Code of Federal Regulations as follows:

PART 21--CERTIFICATION PROCEDURES FOR PRODUCTS AND ARTICLES

0
1. The authority citation for part 21 continues to read as follows:

    Authority: 42 U.S.C. 7572; 49 U.S.C. 106(g), 40105, 40113,
44701-44702, 44704, 44707, 44709, 44711, 44713, 44715, 45303.

0
2. The heading for part 21 is revised to read as set forth above.

0
3. Amend Sec.  21.1 by revising paragraph (b)(1), redesignating
paragraphs (b)(5) through (b)(8) as (b)(6) through (b)(9), and adding
new paragraphs (b)(5) and (b)(10) to read as follows:

Sec.  21.1  Applicability and definitions.

* * * * *
    (b) * * *
    (1) Airworthiness approval means a document, issued by the FAA for
an aircraft, aircraft engine, propeller, or article, which certifies
that the aircraft, aircraft engine, propeller, or article conforms to
its approved design and is in a condition for safe operation, unless
otherwise specified;
* * * * *
    (5) Interface component means an article that serves as a
functional interface between an aircraft and an aircraft engine, an
aircraft engine and a propeller, or an aircraft and a propeller. An
interface component is designated by the holder of the type certificate
or the supplemental type certificate who controls the approved design
data for that article;
* * * * *
    (10) Supplier means a person at any tier in the supply chain who
provides a product, article, or service that is used or consumed in the
design or manufacture of, or installed on, a product or article.

0
4. Revise Sec.  21.135 to read as follows:

Sec.  21.135  Organization.

    (a) Each applicant for or holder of a production certificate must
provide the FAA with a document--
    (1) Describing how its organization will ensure compliance with the
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities,
and the functional relationship of those responsible for quality to
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this
section must be responsible within the applicant's or production
approval holder's organization for, and have authority over, all
production operations conducted under this part. The accountable
manager must confirm that the procedures described in the quality
manual required by Sec.  21.138 are in place and that the production
approval holder satisfies the requirements of the applicable
regulations of subchapter C, Aircraft. The accountable manager must
serve as the primary contact with the FAA.

0
5. Amend Sec.  21.137 by revising paragraphs (c)(1) and (2) and adding
paragraph (o) to read as follows:

Sec.  21.137  Quality system.

* * * * *
    (c) * * *
    (1) Ensure that each supplier-provided product, article, or service
conforms to the production approval holder's requirements; and
    (2) Establish a supplier-reporting process for products, articles,
or services that have been released from or provided by the supplier
and subsequently found not to conform to the production approval
holder's requirements.
* * * * *
    (o) Issuing authorized release documents. Procedures for issuing
authorized release documents for aircraft engines, propellers, and
articles if the production approval holder intends to issue those
documents. These procedures must provide for the selection,
appointment, training, management, and removal of individuals
authorized by the production approval holder to issue authorized
release documents. Authorized release documents may be issued for new
aircraft engines, propellers, and articles manufactured by the
production approval holder; and for used aircraft engines, propellers,
and articles when rebuilt, or altered, in accordance with Sec.  43.3(j)
of this chapter. When a production approval holder issues an authorized
release document for the purpose of export, the production approval
holder must comply with the procedures applicable to the export of new
and used aircraft engines, propellers, and articles specified in Sec.
21.331 and the responsibilities of exporters specified in Sec.  21.335.

0
6. Revise Sec.  21.142 to read as follows:

Sec.  21.142  Production limitation record.

    The FAA issues a production limitation record as part of a
production certificate. The record lists the type certificate number
and model of every product that the production certificate holder is
authorized to manufacture, and identifies every interface component
that the production certificate holder is authorized to manufacture and
install under this part.

0
7. Revise Sec.  21.147 to read as follows:

Sec.  21.147  Amendment of production certificates.

    (a) A holder of a production certificate must apply for an
amendment to a production certificate in a form and manner prescribed
by the FAA.
    (b) An applicant for an amendment to a production certificate to
add a type certificate or model, or both, must comply with Sec. Sec.
21.137, 21.138, and 21.150.
    (c) An applicant may apply to amend its production limitation
record to allow the manufacture and installation of an interface
component, provided--
    (1) The applicant owns or has a license to use the design and
installation data for the interface component and makes that data
available to the FAA upon request;
    (2) The applicant manufactures the interface component;
    (3) The applicant's product conforms to its approved type design
and the interface component conforms to its approved type design;
    (4) The assembled product with the installed interface component is
in a condition for safe operation; and
    (5) The applicant complies with any other conditions and
limitations the FAA considers necessary.

0
8. Revise Sec.  21.305 to read as follows:

Sec.  21.305  Organization.

    (a) Each applicant for or holder of a PMA must provide the FAA with
a document--
    (1) Describing how its organization will ensure compliance with the
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities,
and the functional relationship of those responsible for quality to
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this
section must be responsible within the applicant's or production
approval holder's organization for, and have authority over, all
production operations conducted under this part. The accountable
manager must confirm that the procedures described in the quality
manual required by Sec.  21.308 are in place and that the production
approval holder

satisfies the requirements of the applicable regulations of subchapter
C, Aircraft. The accountable manager must serve as the primary contact
with the FAA.
0
9. Revise Sec.  21.605 to read as follows:

Sec.  21.605  Organization.

    (a) Each applicant for or holder of a TSO authorization must
provide the FAA with a document--
    (1) Describing how its organization will ensure compliance with the
provisions of this subpart;
    (2) Describing assigned responsibilities, delegated authorities,
and the functional relationship of those responsible for quality to
management and other organizational components; and
    (3) Identifying an accountable manager.
    (b) The accountable manager specified in paragraph (a) of this
section must be responsible within the applicant's or production
approval holder's organization for, and have authority over, all
production operations conducted under this part. The accountable
manager must confirm that the procedures described in the quality
manual required by Sec.  21.608 are in place and that the production
approval holder satisfies the requirements of the applicable
regulations of subchapter C, Aircraft. The accountable manager must
serve as the primary contact with the FAA.

PART 45--IDENTIFICATION AND REGISTRATION MARKING

0
10. The authority citation for part 45 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40103, 40113-40114, 44101-44105,
44107-44111, 44504, 44701, 44708-44709, 44711-44713, 44725, 45302-
45303, 46104, 46304, 46306, 47122.

0
11. Revise Sec.  45.11(c) introductory text to read as follows:

Sec.  45.11  Marking of products.

* * * * *
    (c) Propellers and propeller blades and hubs. Each person who
produces a propeller, propeller blade, or propeller hub under a type
certificate or production certificate must mark each product or part.
Except for a fixed-pitch wooden propeller, the marking must be
accomplished using an approved fireproof method. The marking must--
* * * * *

    Issued under authority provided by 49 U.S.C. 106(f), 44701(a),
and 44703 in Washington, DC, on September 25, 2015.
Michael P. Huerta,
Administrator.
[FR Doc. 2015-24950 Filed 9-30-15; 8:45 am]
BILLING CODE 4910-13-P