[Federal Register Volume 85, Number 199 (Wednesday, October 14, 2020)]
[Proposed Rules]
[Pages 65020-65025]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-21957]
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FEDERAL MARITIME COMMISSION
46 CFR Part 540
[Docket No. 20-15]
RIN 3072-AC82
Passenger Vessel Financial Responsibility
AGENCY: Federal Maritime Commission.
ACTION: Advance Notice of Proposed Rulemaking (ANPRM).
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SUMMARY: The Federal Maritime Commission (Commission) is issuing this
ANPRM to seek comment on potential regulatory changes to its passenger
vessel operator financial responsibility requirements. These changes
were recommended in an Interim Report issued by the Fact Finding
Officer in Commission Fact Finding 30: COVID-19 Impact on Cruise
Industry.
DATES: Submit comments on or before November 13, 2020.
ADDRESSES: You may submit comments, identified by Docket No. 20-15, by
the following methods:
Email: secretary@fmc.gov. For comments, include in the
subject line: ``Docket No. 20-15, Comments on PVO Financial
Responsibility Rulemaking.'' Comments should be attached to the email
as a Microsoft Word or text-searchable PDF document.
Instructions: For detailed instructions on submitting comments,
including requesting confidential treatment of comments, and additional
information on the rulemaking process, see the Public Participation
heading of the SUPPLEMENTARY INFORMATION section of this document. Note
that all comments received will be posted without change to the
Commission's website, unless the commenter has requested confidential
treatment.
Docket: For access to the docket to read background documents or
comments received, go to the Commission's Electronic Reading Room at:
https://www2.fmc.gov/readingroom/proceeding/20-15/.
FOR FURTHER INFORMATION CONTACT: Rachel E. Dickon, Secretary; Phone:
(202) 523-5725; Email: secretary@fmc.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary
II. Background
A. PVO Program
B. Fact Finding 30
III. Proposed Changes and Request for Comments
A. Defining Nonperformance of Transportation
B. Process for Obtaining Refunds From PVO Instruments After
Nonperformance of Transportation
1. General
2. Deadline for Submitting Refund Requests
3. Deadline for Refund Payment
4. Form and Amount of Refund Payment
5. Publishing Information on How To Obtain Refunds
C. Passenger Cancellations
IV. Public Participation
V. Rulemaking Analyses and Notices
I. Executive Summary
Before a passenger vessel operator (PVO) may arrange, offer,
advertise, or provide transportation on a vessel, the PVO must file
with the Commission evidence of responsibility to indemnify passengers
in the event of nonperformance of transportation.\1\ Satisfactory
evidence includes a copy of a bond, insurance, guaranty, or escrow
agreement meeting the Commission's requirements in 46 CFR part 540. The
Commission reviews the PVO's submission and if it meets the
Commission's requirements, it will issue the PVO a Certificate of
Financial Responsibility for Indemnification of Passengers for
Nonperformance of Transportation (Certificate (Performance)).\2\
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\1\ 46 U.S.C. 44102; 46 CFR part 540, subpart A.
\2\ 46 CFR 540.7.
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Following the arrival of Coronavirus disease 2019 (COVID-19) in the
United States, the Centers for Disease Control and Prevention (CDC)
issued a ``No Sail Order and Suspension of Further Embarkation,'' (CDC
No Sail Order) causing PVOs to cease all operations and raising
questions regarding passengers' ability to obtain refunds of monies
paid for transportation disrupted by COVID-19. In response, the
Commission initiated Fact Finding 30: COVID-19 Impact on Cruise
Industry, on April 30, 2020.
The Fact Finding Officer issued an Interim Report on PVO Refund
Policies
[[Page 65021]]
on July 27, 2020, concluding that clearer guidance is needed in
determining whether a passenger is entitled to obtain a refund if a PVO
cancels a voyage, makes a significant schedule change, or significantly
delays a voyage.\3\ The Fact-Finding Officer proposed, among other
things, that the Commission provide a clear interpretation of
nonperformance of transportation and modify the appropriate provisions
of the Commission's PVO regulations to make clear how passengers may
obtain refunds under the PVOs' financial responsibility instruments
filed with the Commission. The Commission voted on August 10, 2020, to
initiate a rulemaking to implement the recommended changes.
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\3\ See Fact Finding Investigation No. 30: COVID-19 Impact on
Cruise Industry, Interim Report: Refund Policy, at 11-13 (July 27,
2020) (Fact Finding 30 Interim Report or Interim Report).
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The Commission is requesting comment on these recommended changes
and their effects on PVOs and passengers. In addition to general
comments, the Commission is requesting focused comment on the issues
identified below in section III for each of the recommended changes.
II. Background
A. PVO Program
On November 6, 1966, Congress enacted Public Law 89-777. Section 2
of the statute (codified at 46 U.S.C. 44103) requires owners and
charterers of vessels having berth or stateroom accommodations for 50
or more passengers, and embarking passengers at United States ports, to
establish financial responsibility to meet any liability incurred for
death or injury to passengers or other persons on voyages to or from
United States ports. Section 3 of the statute (codified at 46 U.S.C.
44102) requires persons arranging, offering, advertising, or providing
passage on such vessels to establish financial responsibility for
indemnification of passengers for nonperformance of transportation. The
Commission published implementing regulations at 46 CFR part 540 in
1967.\4\
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\4\ 32 FR 3986 (Mar. 11, 1967) (establishing regulations
governing nonperformance coverage); 32 FR 7282 (May 16, 1967)
(establishing regulations governing casualty coverage).
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Under this program, the Commission issues two types of certificates
to PVOs of vessels that: (1) Have berths for 50 or more passengers; and
(2) embark passengers from U.S. ports. The first type of Certificate
(Performance) is issued by the Commission when a PVO provides the
Commission with acceptable coverage to satisfy liability incurred for
nonperformance of transportation up to the amount of unearned passenger
revenue (UPR) held by the PVO or the monetary cap set in the
Commission's regulation. Such coverage may be in the form of insurance,
a guaranty, a surety bond, or escrow agreement (collectively referred
to as financial responsibility instruments).\5\ The coverage is used to
reimburse passengers when the PVO fails to perform cruises as
contracted and has taken no further actions to refund passengers.\6\
The second type of Certificate (Casualty) is issued by the Commission
when a PVO provides the Commission with acceptable coverage to satisfy
any liability incurred for death or injury during a voyage, as provided
in the regulations and statute.
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\5\ The Commission's regulations also permit smaller PVOs to
request to substitute alternative forms of financial protection as
evidence of financial responsibility. See 46 CFR 540.9(l).
\6\ In practice, passengers generally receive refunds for
canceled cruises from the PVOs directly or, if the passenger paid by
credit card, from the credit card issuer. Refund payments under the
PVO financial responsibility instruments are rare and usually only
occur if the PVO ceases operations or declares bankruptcy.
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There have been few changes to the regulations in part 540 since
its inception. Changes have included several increases to the monetary
cap for required performance coverage under section 44102, the
elimination of the self-insurance option for PVOs, some limitations on
the types of entities acceptable as guarantors, and the elimination of
certain sliding-scale provisions as to the amount of coverage required.
Most recently, the Commission increased the cap on required performance
coverage in two annual steps, from $15 million to $22 million in 2014,
and then from $22 million to $30 million in 2015.\7\ Since 2015, the
cap has been adjusted for inflation every two years based upon the U.S.
Bureau of Labor Statistics' Consumer Price Index. The current cap is
$32 million.\8\
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\7\ 46 CFR 540.9(j); Final Rule: Passenger Financial
Responsibility Requirements for Nonperformance of Transportation, 78
FR 13268 (Feb. 27, 2013).
\8\ Notice: Financial Responsibility for Indemnification of
Passengers for Nonperformance of Transportation-Cap Adjustment, 84
FR 17410 (June 24, 2019).
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B. Fact Finding 30
In response to COVID-19, the Centers for Disease Control and
Prevention (CDC) issued a ``No Sail Order and Suspension of Further
Embarkation'' (CDC No Sail Order) on March 14, 2020, causing PVOs to
cease all operations. Due to the unpredictable nature of the disease,
the CDC has extended the term of the order through September 30,
2020.\9\ Consequently, questions arose concerning future cruises and
passengers' ability to obtain refunds of monies paid for transportation
disrupted by COVID-19.
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\9\ CDC Newsroom, https://www.cdc.gov/media/releases/2020/s0716-cruise-ship-no-sail-order.html.
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The Commission initiated Fact Finding 30 on April 30, 2020, to
investigate COVID-19's impact and identify commercial solutions to
COVID-19-related issues that interfere with the operation of the cruise
industry. The Commission's Fact Finding Officer has been meeting with
PVOs, marine terminal operators, and other stakeholders to understand
COVID-19's effects on the cruise industry.
On July 27, the Fact Finding Officer issued an Interim Report
recommending certain regulatory changes to the Commission's regulations
with respect to PVOs. The Fact Finding Officer concluded that clearer
guidance is needed in determining whether a passenger is entitled to
obtain refunds if a PVO cancels a voyage, makes a significant schedule
change, or significantly delays a voyage.
The Fact Finding Officer stated that a clear and consistent policy
toward ticket refunds would eliminate any uncertainty on the part of
passengers and would provide clear terms upon which the industry may
plan for future operations. The Fact Finding Officer proposed, among
other things, that the Commission provide a clear interpretation of
nonperformance of transportation and modify the appropriate provisions
of the Commission's PVO regulations in part 540 to make clear how
passengers may obtain refunds under the PVOs' financial instruments
filed with the Commission. These recommendations were as follows:
Therefore, it is proposed that the Commission: (1) Interpret
``nonperformance of transportation'' to include cancelling a sailing
or delaying passenger boarding by twenty-four (24) hours or more;
and (2) modify the appropriate provisions of the Commission's PVO
regulations to make clear how passengers may obtain refunds under
the PVOs' financial instruments:
1. When a sailing is cancelled or consumer boarding is delayed
by twenty-four (24) hours or more for any reason other than due to a
government order or declaration in paragraph 2 below, full refunds
must be paid within sixty (60) days following a passenger refund
request.
2. When a sailing is cancelled or consumer boarding is delayed
by twenty-four (24) hours or more due to a governmental order or
declaration, full refunds must be paid within one hundred eighty
(180) days following a passenger refund request. This includes all
[[Page 65022]]
consumers who, at their own discretion, cancelled their booking
within sixty (60) days prior to said governmental action and
commensurate cancelled or delayed sailing.
3. If, following a declaration of a public health emergency, any
consumer cancels a cruise booking of a sailing that may be affected
by such emergency after the PVO's refund deadline, but the sailing
is not cancelled, the PVO will provide a credit for a future cruise
equal to the consumer's amount of deposit. In all other cases in
which a consumer cancels and embarkation and sailing occur within
the prescribed timeline, the cruise line's rules for cancellation
will apply.
4. A PVO may set a reasonable deadline for a consumer entitled
to a refund to request the refund which shall not be less than 6
months after the scheduled voyage.
5. Refunds should include all fees paid to carrier by consumer
to include all ancillary fees remitted to the carrier by the
consumer.
6. Refunds to be given in same fashion as monies were originally
remitted to the carrier. The PVO will be deemed to have made a
refund payment if the deposited revenue as to a passenger requesting
a refund is remitted by the PVO in the same manner as the
passenger's original payment, by: (1) Mailing a check payable in
immediately available funds to the passenger at an address furnished
by the passenger, (2) issuing an electronic funds transfer,
including wire transfer, automated clearinghouse (ACH) or other
electronic means, in immediately available funds, or (3) posting of
a credit to the credit card processor for the benefit of the credit
card account used by passenger to make payments to the applicant.
The refund will be deemed timely notwithstanding that passenger may
not immediately have access to the transferred funds in its account
or any credit card account due to rules and processes of any third-
party services provider.
7. Nothing in this rule shall be interpreted to preclude the
consumer and the PVO from entering into an alternative form of
compensation in full satisfaction of a required refund, such as a
future cruise credit.\10\
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\10\ Fact Finding 30 Interim Report at 11-12.
The Fact Finding Officer also recommended the Commission mandate
that: (1) PVOs provide on their websites clear instructions on how
passengers may obtain refunds; and (2) PVOs submit current web
addresses showing their refund instructions to the Commission for
publication on the Commission's website.\11\
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\11\ Id. at 12.
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III. Proposed Changes and Request for Comments
A. Defining Nonperformance of Transportation
As discussed above, 46 U.S.C. 44102 requires that PVOs file with
the Commission evidence of financial responsibility to indemnify
passenger for nonperformance of transportation. The Commission's
regulations in 46 CFR part 540 do not expressly define what constitutes
nonperformance of transportation, but the substantive provisions and
required financial responsibility instrument terms indicate that it
means the PVO's failure to provide transportation or other
accommodations and services subject to part 540, subpart A,\12\ in
accordance with the terms of the ticket contract between the PVO and
passenger.\13\
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\12\ The scope of the transportation, accommodations, and
services covered is described in the definition of ``unearned
passenger revenue'' in Sec. 540.2 and includes water transportation
and all other accommodations, services, and facilities relating
thereto, but excludes air transportation, hotel accommodations, or
tour excursions. 46 CFR 540.2(i).
\13\ See 46 CFR 540.1(a) (stating that PVOs must file evidence
of financial responsibility or a bond or other security for
obligations under the terms of ticket contracts to indemnify
passengers for nonperformance of transportation to which they would
be entitled; Form FMC-132A to Subpart A of Part 540 (stating that:
(1) The purpose of the bond is to insure financial responsibility
and the supplying transportation and other services subject to
subpart A of part 540, in accordance with the ticket contract
between the PVO and the passenger; and (2) the scope of the surety's
liability is for refunds due under ticket contracts made by the PVO
for the supplying of transportation and other services).
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As noted in the Fact Finding 30 Interim Report, what constitutes
nonperformance of transportation under the current regulations depends
on the specific terms of each PVO's ticket contract and may vary from
PVO to PVO or from contract to contract.\14\ Accordingly, the Interim
Report recommended interpreting nonperformance of transportation under
46 U.S.C. 44102 to include: (1) Canceling a voyage; and (2) delaying
passenger boarding by 24 hours or more. Similar to the U.S. Department
of Transportation's policy (cited in the Interim Report) addressing
when airline passengers are entitled to refunds from air carriers, a
delay would only constitute nonperformance if the passenger chooses not
to embark on the delayed voyage.
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\14\ Fact Finding 30 Interim Report at 11.
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The Commission is seeking comment on adopting this definition of
nonperformance of transportation. The Commission anticipates that
implementing this change would involve amending the regulations in part
540, subpart A, to include the definition and revising the language of
the forms for financial responsibility instruments (surety bonds,
guaranties, and escrow agreements) to reflect coverage in situations
under the definition.\15\ To that end, the Commission has developed the
following draft definition:
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\15\ These forms include Form FMC-132A, Passenger Vessel Surety
Bond (Performance); Form FMC-133A, Guaranty in Respect of Liability
for Nonperformance, Section 3 of the Act; Appendix A, Example of
Escrow Agreement for Use Under 46 CFR 540.5(b)). There is no
required or optional form for insurance, which must meet the
requirement in Sec. 540.5(a).
Nonperformance of transportation means: (1) Canceling a voyage;
or (2) delaying the boarding of passengers by more than twenty-four
(24) hours if the passenger elects not to embark on the substitute
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or delayed voyage.
The Commission predicts that this interpretation may change the
situations in which passengers could make claims for refunds against
the PVO's financial responsibility instrument. In addition to a request
for comments on the draft definition provided above, the Commission
requests comments on:
Necessary changes to the Commission's regulations,
including the financial responsibility instrument forms, to implement
the revised definition of nonperformance of transportation;
Whether this change will increase or decrease claims for
refunds against PVO financial responsibility instruments (i.e., bond,
insurance, guaranty, or escrow agreement), and if so, the magnitude of
the increase or decrease (including number of claims and total dollar
amounts paid to passengers);
Whether this change will increase or decrease the cost to
PVOs of obtaining compliant financial responsibility instruments (e.g.,
higher or lower premiums or collateral requirements), and if so, the
magnitude of the increase or decrease (i.e., dollar amount);
Other effects of this change the Commission should
consider.
B. Process for Obtaining Refunds From PVO Instruments for
Nonperformance of Transportation
1. General
Although the Commission regulations require certain coverage and
terms to be included in financial responsibility instruments, the
regulations do not include uniform procedures regarding how and when
passengers may make claims for refunds against the various financial
responsibility instruments. The Fact Finding 30 Interim Report
recommended that the Commission revise its regulations to make clear
how passengers may obtain refunds under these instruments and include
specific provisions related to such claims and the timing of refund
payments.\16\
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\16\ Fact Finding 30 Interim Report at 11-12.
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Neither part 540 nor the financial responsibility instrument forms
provide
[[Page 65023]]
specific instructions on how or when passengers may obtain refunds
under a PVO's financial responsibility instrument. For example, the
Guaranty Form (Form FMC-133A) provides that Guarantor will make refund
payments to passengers when: (1) The PVO and passenger enter into
settlement agreement, approved by the Guarantor; or (2) the passenger
obtains a final judgment against the PVO and the PVO does not make
payment within 21 days. Similarly, the suggested language for Escrow
Agreements in Appendix A states that an Escrow Agent will make refund
payments to passengers when either: (1) The PVO provides written
instructions to the Escrow Agent to make such payment; or (2) the
passenger obtains a final judgment against the PVO, the PVO does not
make payment within 21 days, and the Escrow Agent receives a certified
copy of the court order.
The Fact Finding 30 Interim Report recommended the following
general procedure: (1) The passenger makes a request for a refund from
a PVO financial responsibility instrument when nonperformance has
occurred; and (2) the refund payment is made within a certain period,
depending on certain conditions.\17\ Under this procedure, the
passenger would not need a final court judgment in order to obtain a
refund. The Commission anticipates that implementing these changes
would involve amending the regulations in part 540, subpart A and the
language of the financial responsibility instruments forms to reflect
the new procedure. The Commission requests comment on the following
issues related to this procedure that would need to be resolved in any
proposed revisions to the Commission's regulations:
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\17\ Fact Finding 30 Interim Report at 11-12.
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To whom passengers should submit requests for refunds
under the revised procedures.
Should passengers submit refund claims to the financial
responsibility instrument providers directly (e.g., surety company,
insurer, guarantor, or escrow agent)? Alternatively, should passengers
submit refund claims to the PVO, and the PVO in turn authorizes payment
from the financial responsibility instrument (similar to the current
procedure for escrow agreements)?
Information passengers will need to provide to obtain a
refund.
Should the Commission specify the information necessary
for passengers to submit to obtain refunds from a PVO financial
responsibility instrument, or should those decisions be left to the
individual PVOs and their financial responsibility providers?
If the Commission should specify the necessary information
from passengers, what information should be required beyond evidence of
payment to the PVO, ticket contract, and evidence of cancellation or
delayed boarding?
Necessary changes to the Commission's regulations,
including the financial responsibility instrument forms, to implement
the revised process for obtaining refunds.
The Commission is also requesting comments on the effects of the
recommended changes described in this section (section III.B)
(individually and as a whole), including:
Whether these changes will increase or decrease claims for
refunds against PVO financial responsibility instruments, and if so,
the magnitude of the increase or decrease (including number of claims
and total dollar amounts paid to passengers).
Whether these changes will increase or decrease the cost
to PVOs of obtaining compliant financial responsibility instruments
(e.g., higher or lower premiums or collateral requirements), and if so,
the source and magnitude of the increase or decrease (i.e., dollar
amount).
Other effects of these changes the Commission should
consider.
2. Deadline for Submitting Refund Requests
Commission regulations do not currently prescribe how long
passengers have after a scheduled voyage to seek a refund from a PVO
financial responsibility instrument. The Fact Finding 30 Interim Report
recommended that the Commission specify that a PVO may set a reasonable
deadline for passenger refund requests but the deadline may not be less
than six months after the scheduled voyage.\18\ The Commission has
developed the following draft provision to reflect this recommendation:
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\18\ Fact Finding 30 Interim Report at 12.
A passenger must submit a request for refund no later than 180
days \19\ after nonperformance occurs, unless the ticket contract or
other passenger vessel operator policy allows a longer period of
time for such requests.
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\19\ For clarity and ease of calculation, the Commission
contemplates using a deadline of 180 days rather than six months.
The Commission could include this provision in part 540 and require
that the financial responsibility instrument specify the time period
for passengers to file refund requests. The Commission requests comment
on prescribing a minimum timeframe for refund requests, the amount of
time recommended in the Fact Finding 30 Interim Report (six months) and
the draft language provided above. As discussed above in section
III.B.1, the Commission also requests comment on the effects of this
change.
3. Deadline for Refund Payment
Commission regulations do not currently specify a time period
within which passengers must receive a refund under a PVO financial
responsibility instrument. The Fact Finding 30 Interim Report
recommended that the Commission specify two different timeframes for
payment depending on whether nonperformance was due to ``a governmental
order or declaration'': (1) When nonperformance is due to a
governmental order or declaration, full refund payments must be made
within 180 days after the passenger requests a refund; and (2) in all
other cases, full refund payments must be made within 60 days after the
passenger requests a refund.\20\ The Interim Report also recommended
that a refund payment be deemed timely notwithstanding that the
passenger may not immediately have access to the funds due to the rules
and processes of any third party services provider.\21\
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\20\ Fact Finding Interim Report at 11.
\21\ Id. at 12.
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The Commission requests comment on prescribing a deadline for
payment of refunds from financial responsibility instruments as a
general matter, establishing two different timeframes for payment
depending on whether nonperformance is due to a governmental order or
declaration, and the deadlines recommended in the Interim Report (180
days when there is a governmental order or declaration; 60 days in all
other cases). The Commission also requests comment on the following:
The types of governmental orders or declarations that
would trigger the longer 180-day period for providing refunds.
Should these include only U.S. federal, state, and local
orders or declarations, or should foreign government orders and
declarations also trigger the longer refund payment period?
What types of governmental orders and declarations should
qualify, i.e., should this be limited to governmental orders and
declarations that expressly prohibit embarking passengers and suspend
passenger operations like the CDC No Sail Order? If not, what other
[[Page 65024]]
types of governmental orders and declarations should trigger the longer
refund payment period?
The effects of this change as discussed above in section
III.B.1.
4. Form and Amount of Refund Payment
Commission regulations provide that the PVO financial
responsibility instruments must provide coverage for ``unearned
passenger revenue,'' which is defined as passenger revenue received for
water transportation and all other accommodations, services, and
facilities relating thereto not yet performed; this includes port fees
and taxes paid, but excludes such items as airfare, hotel
accommodations, and tour excursions.\22\ The regulations do not specify
in what form refund payments must be made under PVO financial
responsibility instruments.
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\22\ 46 CFR 540.2(i).
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The Fact Finding 30 Interim Report recommended the Commission
specify: (1) That refund payments must include all fees, including
ancillary fees, paid to the PVO by the passenger; and (2) refund
payments must be made in the same manner as the passenger's original
payment, e.g., check, electronic funds transfer, or credit card
chargeback.\23\
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\23\ Fact Finding 30 Interim Report at 11-12.
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Regarding the first recommendation, the Commission is requesting
comment on whether to expand the definition of unearned passenger
revenue and the scope of the ancillary fees to be included in any
revised definition. The Fact Finding 30 Interim Report discusses the
following types of ancillary charges paid by passengers to PVOs prior
to sailing: Gratuities, shore excursions, pre-cruise onboard purchases,
port fees, and taxes. Of these, the current definition of unearned
passenger revenue expressly includes port fees and taxes and excludes
excursions. The Interim Report does not discuss refunds for airfare or
hotel accommodation.
To facilitate comment, the Commission has developed the following
draft definition:
Unearned passenger revenue means that passenger revenue received
for water transportation and all other related accommodations,
services, and facilities relating thereto not yet performed; this
includes port fees, taxes, and all ancillary fees remitted to the
passenger vessel operator by the passenger.
The Commission requests comment on expanding the definition of
unearned passenger revenue, including:
What types of ancillary fees should be included as
unearned passenger revenue subject to refund, and what types of fees
should be excluded.
For example, should the Commission include the types of
fees mentioned in the Fact Finding 30 Interim Report (e.g., shore
excursions, dining packages, other onboard packages, and gratuities)?
Are there any types of fees that should be included?
Should the definition continue to exclude airfare and
hotel accommodations?
The effects of this change as discussed above in section
III.B.1.
The Commission is also requesting comment on the recommendation to
specify that refund payments must be made in the same manner as the
passenger's original payment. Specifically, the Commission requests
comment on the following:
Whether it is feasible for payment from a PVO financial
responsibility instrument to be made in the same manner as the
passenger's original payment.
Necessary changes to the Commission's regulations,
including the financial responsibility instrument forms, to implement
this recommendation.
The effects of this change as discussed above in section
III.B.1.
5. Publishing Information on How To Obtain Refunds
The Fact Finding 30 Interim Report recommended the Commission
mandate that: (1) PVOs provide on their websites clear instructions on
how passengers may obtain refunds; and (2) PVOs submit current website
addresses for their refund instructions to the Commission for
publication on the Commission's website.\24\ The Commission envisions
that this recommendation could be implemented by: (1) Revising the Form
FMC-131, Application for Certificate of Financial Responsibility, to
require PVOs to provide the uniform resource locator (URL) for their
refund instructions; and (2) amending Sec. 540.4 to require PVOs to
amend their application if the URL changes. The Commission requests
comment on this potential change, including:
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\24\ Id. at 12.
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Whether the Commission should prescribe any specific
content or format requirements for published PVO refund instructions.
The nature of any additional regulatory burden associated
with publishing refund policies on a PVO's website or providing the URL
for those instructions to the Commission, as well as the estimated cost
to PVOs.
C. Passenger Cancellations
In addition to recommendations related to passenger refunds in the
event of nonperformance of transportation, the Fact Finding 30 Interim
Report also proposed that the Commission amend its regulations to
ensure PVO financial responsibility in the event passengers cancel
their booking with a PVO prior to or following certain governmental
orders or declarations. Specifically, the Fact Finding 30 Interim
Report recommended that: (1) A passenger be entitled to a refund if
they cancel their booking no more than 60 days prior to a governmental
order or declaration that results in the PVO canceling the voyage or
delaying boarding of passengers by more than 24 hours; and (2) a
passenger be entitled to a future cruise credit if they cancel their
booking following the declaration of a public health emergency and the
voyage occurs as scheduled.
The Commission requests comment on the recommendation regarding
passenger refunds when the passenger cancels their booking and the
voyage is subsequently canceled as a result of a governmental orders or
declarations, including comment on the following:
The types of governmental orders or declarations that
would make a passenger eligible for a refund when they cancel their
booking.
Should these include only U.S. federal, state, and local
orders or declarations, or should foreign government orders and
declarations also trigger the longer refund payment period?
What types of governmental orders and declarations
qualify, i.e., should this be limited to governmental orders and
declarations that expressly prohibit embarking passengers and suspend
passenger operations like the CDC No Sail Order? If not, what other
types of governmental orders and declarations should qualify?
Information passengers will need to provide to obtain a
refund.
Should the Commission specify the information necessary
for passengers to submit to obtain refunds from a PVO financial
responsibility instrument, or should those decisions be left to the
individual PVOs and their financial responsibility providers?
If the Commission should specify the necessary information
from passengers, what information should be required? Such required
information could include evidence of payment to the PVO, ticket
contract, evidence showing cancellation of the booking,
[[Page 65025]]
evidence of a governmental order or declaration, and evidence of
cancellation or delayed boarding of the voyage.
The Commission also requests comment on the recommendation
regarding the provision of future cruise credit when the passenger
cancels their booking following declaration of a public health
emergency but the voyage occurs as scheduled, including comment on the
following:
Whether it is feasible for a passenger to obtain future
cruise credit under a PVO financial responsibility instrument.
The type of public health emergency declaration that would
make a passenger eligible for a future cruise credit when they cancel
their booking.
Whether requests for future cruise credit should be
subject to the same requirements as those recommended for refunds with
respect to the deadline for requesting credit, the deadline for
providing credit, and the amount of the credit.
The Commission also requests comment on the following related to
both recommendations:
Necessary changes to the Commission's regulations,
including the financial responsibility instrument forms, to implement
these changes.
Whether these changes will increase or decrease claims for
refunds against PVO financial responsibility instruments, and if so,
the magnitude of the increase or decrease (including number of claims
and total dollar amounts paid to passengers).
Whether these changes will increase or decrease the cost
to PVOs of obtaining compliant financial responsibility instruments
(e.g., higher or lower premiums or collateral requirements), and if so,
the magnitude of the increase or decrease (i.e., dollar amount).
Other effects of these changes the Commission should
consider.
IV. Public Participation
How do I prepare and submit comments?
Your comments must be written and in English. To ensure that your
comments are correctly filed in the docket, please include the docket
number of this document in your comments.
You may submit your comments via email to the email address listed
above under ADDRESSES. Please include the docket number associated with
this notice and the subject matter in the subject line of the email.
Comments should be attached to the email as a Microsoft Word or text-
searchable PDF document.
How do I submit confidential business information?
The Commission will provide confidential treatment for identified
confidential information to the extent allowed by law. If your comments
contain confidential information, you must submit the following by
email to the address listed above under ADDRESSES:
A transmittal letter requesting confidential treatment
that identifies the specific information in the comments for which
protection is sought and demonstrates that the information is a trade
secret or other confidential research, development, or commercial
information.
A confidential copy of your comments, consisting of the
complete filing with a cover page marked ``Confidential-Restricted,''
and the confidential material clearly marked on each page.
A public version of your comments with the confidential
information excluded. The public version must state ``Public Version--
confidential materials excluded'' on the cover page and on each
affected page, and must clearly indicate any information withheld.
Will the Commission consider late comments?
The Commission will consider all comments received before the close
of business on the comment closing date indicated above under DATES. To
the extent possible, we will also consider comments received after that
date.
How can I read comments submitted by other people?
You may read the comments received by the Commission at the
Commission's Electronic Reading Room at the address listed above under
ADDRESSES.
V. Rulemaking Analyses and Notices
Regulatory Flexibility Act
Under the Regulatory Flexibility Act (codified as amended at 5
U.S.C. 601-612), no analysis is required for an ANPRM. However, PVOs
are encouraged to comment on any aspects of the potential rulemaking
that may apply to them and the potential impact.
National Environmental Policy Act
The Commission's regulations categorically exclude certain
rulemakings from any requirement to prepare an environmental assessment
or an environmental impact statement because they do not increase or
decrease air, water or noise pollution or the use of fossil fuels,
recyclables, or energy. 46 CFR 504.4. The ANPRM discusses potential
amendments to Commission's program for certifying the financial
responsibility of PVOs. This rulemaking thus falls within the
categorical exclusion for certification of financial responsibility of
passenger vessels under Part 540. Sec. 504.4(2). Therefore, no
environmental assessment or environmental impact statement is required.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA)
requires an agency to seek and receive approval from the Office of
Management and Budget (OMB) before collecting information from the
public. 44 U.S.C. 3507. The agency must submit collections of
information in proposed rules to OMB in conjunction with the
publication of the notice of proposed rulemaking. 5 CFR 1320.11. Any
information collection requirements and associated burdens will be
discussed in detail if a proposed rule is issued.
Executive Order 12988 (Civil Justice Reform)
The Commission will ensure that any proposed or final rule issued
in this proceeding meets the applicable standards in E.O. 12988 titled,
``Civil Justice Reform,'' to minimize litigation, eliminate ambiguity,
and reduce burden.
Regulation Identifier Number
The Commission assigns a regulation identifier number (RIN) to each
regulatory action listed in the Unified Agenda of Federal Regulatory
and Deregulatory Actions (Unified Agenda). The Regulatory Information
Service Center publishes the Unified Agenda in April and October of
each year. You may use the RIN contained in the heading at the
beginning of this document to find this action in the Unified Agenda,
available at http://www.reginfo.gov/public/do/eAgendaMain.
By the Commission.
Rachel Dickon,
Secretary.
[FR Doc. 2020-21957 Filed 10-13-20; 8:45 am]
BILLING CODE 6730-02-P