Government Secrecy Takes a Hit

Are you frustrated by government secrecy?  The U.S. Office of the Federal Register is!  And that office is taking steps to try to make government rules more transparent.

What is Incorporation-by-Reference?

Incorporation-by-Reference (or IBR) is the term for regulations that make reference to some other document that is not published in the rule.  Historically, incorporation-by-reference came about because it cost money to print the Federal Register, and wasting a lot of pages on a standard that could easily be obtained outside of the Federal Register.  But today, most people access the regulations and the Federal Register on line, so there  is not as much of a burden associated with publishing such documents.  Incorporation-by-reference can be an issue for the public because when an incorporated document is merely technically available – but it is not really available – then this can make it difficult or impossible for an affected person to comply with the regulation (and can make it impossible for the affected person to even know that (s)he is subject to the regulation).

In short, unavailable-but-incorporated documents can reflect secret regulations that are impossible to comply with.

With this in mind, the Administrative Conference of the US began to study what could be done to update the rules to reflect modern technology.  This ultimately led to the Office of the Federal Register looking into potential changes to the rules on incorporation-by-reference.

Some Problems with Incorporation-by-Reference

The aviation industry faces many challenges related to incorporation-by-reference.  Two issues that are often important to ASA’s members include standard holders who price-gouge and availability of referenced documents (like service bulletins) that can make the difference in whether a rule even applies (without access to these, a distributor’s inventory could be affected by an airworthiness directive and the distributor might never know).

One example of incorporation-by-reference comes through the hazardous materials regulations, which incorporate-by-reference the ICAO Technical Instructions.  Most people know these Technical Instructions as the IATA Dangerous Goods Regulations or DGR (IATA has the license to republish the IATA Technical Instructions).  Over the course of the last ten years, IATA’s price for the Dangerous Goods Regulations that are typically used in the aviation industry has increased from $120 to $309.  Has the cost of paper increased that much?  No, but IATA enjoys a practical monopoly over this text, so there are no market forces to restrain the price increases.

Another popular example is the incorporation by reference of a service bulletin.  ASA members with repair stations obviously  want access to this information to make sure that their work remains compliant but pure distributors often need access to these documents in order to determine whether a proposed AD may affect (and/or devalue) articles in their inventory.  Yet, it is typical for the FAA’s incorporation-by-reference statement to insist that the incorporated service bulletin be obtained either from the FAA office or from the OEM who published the document.  In order to test this system, I emailed an FAA office and an OEM who were described as the sources of a service bulletin (the Federal Register listed the emails and listed this as an acceptable way to make contact).  The FAA response was to go to the OEM.  The OEM response was to ask me why I wanted the service bulletin.  When I responded that the service bulletin was incorporated by reference in a proposed AD, and I wanted a copy of the service bulletin to determine whether the trade association needed to file comments on behalf of the membership, I received no further communication from the OEM.

These two anecdotes show just a narrow sliver of the issues that the Office fo the Federal Register was tackling when it sought to improve the standards for incorporation by reference.

ASA Action

ASA filed comments on the Advance Notice for this proposal and offered a number of suggestions in 2012.  ASA also participated in face-to-face meetings with the government to discuss ways to improve the current system.

The result was a new rule that clarifies obligations related to regulations that incorporate standards by reference.

What Changes Should You Expect?

It is important that incorporated material be available in proposed rules so that the public can comment on the proposed rule with full knowledge fo the proposed rule’s impact.  Under the new standards (1 C.F.R. 51.5(a)), the preamble to a proposed rule must:

  1. Discuss the agency’s efforts to make the IBR materials reasonably available to interested parties, and
  2. Summarize the material it proposes to incorporate by reference in the preamble.

When the agency is ready to publish a final rule with an IBR, the agency must do the following(1 C.F.R. 51.5(b)):

  1. Ask for permission from the Office of the Federal Register to accomplish an IBR,
  2. Explain in the preamble to the final rule how interested parties can get a copy of the IBRed materials (it must be “reasonably available”), and
  3. Ensure a copy of the IBRed publication is on file at the Office of the Federal Register.

An important feature of the regulations is the requirement to discuss availability to “interested parties.”  This is an expansion of the traditional language, which merely required availability to “the class of persons affected by the publication.”  Interested persons should include persons who are indirectly affected (like those with affected inventory in the case of an airworthiness directive) in addition to class of persons directly affected by the publication.

The existing regulations continue to specify that IBR is limited to the edition that is incorporated.  So if a subsequent revision comes out, only the version that was approved by the Office of the Federal Register is the version that is IBRed (and not subsequent versions).  1 C.F.R. 51.1(f).

One sad omission was that the new rule does not define “reasonably available.”  The Office of Federal Register was worried that a definition might be inappropriate, so they were hesitant to offer a definition, and instead they have left it to a case-by-case analysis as defined by each agency.

While we did not get every change we requested, this nonetheless represents a good start on the process of providing better transparency in the situations of incorporation-by-reference.

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About Jason Dickstein
Mr. Dickstein is the President of the Washington Aviation Group, a Washington, DC-based aviation law firm. He represents several aviation trade associations, including the Aviation Suppliers Association, the Aircraft Electronics Association, the Aircraft Fleet Recycling Association and the Modification and Replacement Parts Association.

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