IFR, Application by Certain Mexico-Domiciled Motor Carriers To Operate Beyond United States Municipalities and Commercial Zones

Tuesday,
March 19, 2002

Part III

Department of
Transportation
Federal Motor Carrier Safety
Administration
49 CFR Part 365
Application by Certain Mexico-Domiciled
Motor Carriers To Operate Beyond United
States Municipalities and Commercial
Zones on the United States-Mexico
Border; Final Rule

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Federal Register / Vol. 67, No. 53 / Tuesday, March 19, 2002 / Rules and Regulations

DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety
Administration
49 CFR Part 365
[Docket No. FMCSA–98–3298]
RIN 2126–AA34

Application by Certain MexicoDomiciled Motor Carriers To Operate
Beyond United States Municipalities
and Commercial Zones on the United
States-Mexico Border
AGENCY: Federal Motor Carrier Safety
Administration (FMCSA), DOT.
ACTION: Interim final rule; request for
comments.
SUMMARY: The FMCSA revises its
regulations and form, OP–1(MX),
governing applications by Mexicodomiciled carriers who want to operate
within the United States beyond the
municipalities adjacent to Mexico in
Texas, New Mexico, Arizona and
California and beyond the commercial
zones of such municipalities (‘‘border
zones’’). This interim rule includes
requirements that were not proposed in
the NPRM, but which are necessary to
comply with the Fiscal Year 2002 DOT
Appropriations Act enacted into law in
December 2001. This action is taken in
anticipation of a presidential order
lifting the current statutory moratorium
on authorizing such operations. The
form requires additional information
about the applicant’s business and
operating practices to help the FMCSA
to determine if the applicant will be
able to meet the safety standards
established for operating in interstate
commerce in the United States. Carriers
that previously submitted an
application to operate beyond the
border zones must submit the updated
form. Any Mexico-domiciled motor
carrier (of property) that wants to
operate within the United States solely
within the border zones must apply
under separate FMCSA regulations that
we are issuing elsewhere in today’s
Federal Register. The revisions in this
action are part of FMCSA’s efforts to
ensure the safe operation of Mexicodomiciled motor carriers in the United
States and implement the 2002 DOT
Appropriations Act. This action will
ensure that FMCSA receives adequate
information to assess an applicant’s
ability to comply with U.S. safety
standards. It requires that all Mexicodomiciled carriers subject to this rule
undergo a safety audit before receiving
provisional authority to operate in the
United States. Therefore, the FMCSA is

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publishing this action as an interim
final rule and is delaying the effective
date in order to consider additional
public comments regarding preauthorization safety audits before grants
of provisional authority. These changes
will result in the FMCSA being able to
better maintain an accurate census of
Mexico-domiciled carriers operating
beyond the border zones.
DATES: This interim final rule is
effective May 3, 2002. We must receive
comments by April 18, 2002.
ADDRESSES: You can mail, fax, hand
deliver or electronically submit written
comments to the Docket Management
Facility, United States Department of
Transportation, Dockets Management
Facility, Room PL–401, 400 Seventh
Street, SW., Washington, DC 20590–
0001 FAX (202) 493–2251, on-line at
http://dmses.dot.gov/submit. You must
include the docket number that appears
in the heading of this document in your
comment. You can examine and copy
all comments at the above address from
9 a.m. to 5 p.m., e.t., Monday through
Friday, except Federal holidays. You
can also view all comments or
download an electronic copy of this
document from the DOT Docket
Management System (DMS) at http://
dms.dot.gov/search.htm and typing the
last four digits of the docket number
appearing at the heading of this
document. The DMS is available 24
hours each day, 365 days each year. You
can get electronic submission and
retrieval help and guidelines under the
‘‘help’’ section of the web site. If you
want us to notify you that we received
your comments, please include a selfaddressed, stamped envelope or
postcard or print the acknowledgement
page that appears after submitting
comments on-line.
Comments received after the comment
closing date will be included in the
docket and we will consider late
comments to the extent practicable.
FMCSA may, however, issue a final rule
at any time after the close of the
comment period.
FOR FURTHER INFORMATION CONTACT:
Joanne Cisneros, (909) 653–2299,
Transborder Office, FMCSA, P.O. Box
530870, San Diego, CA 92153–0870.
Office hours are from 7:45 a.m. to 4:15
p.m., p.t., Monday through Friday,
except Federal holidays.
SUPPLEMENTARY INFORMATION:
Background
Before 1982, Mexico-domiciled motor
carriers could apply for authority to
operate within the United States by
filing an application for such authority
with the former Interstate Commerce

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Commission (ICC). Under the Bus
Regulatory Reform Act of 1982 (the Act),
Congress imposed a 2-year moratorium
on the issuance of new grants of U.S.
operating authority to motor carriers
domiciled in a contiguous foreign
country, or owned or controlled by
persons of a contiguous foreign country.
The legislation authorized the President
to remove or modify the moratorium
upon a determination that such action
was in the national interest. The Act
was developed in response to
complaints that neither Mexico nor
Canada were permitting U.S. motor
carriers the same access to their markets
as Mexican and Canadian motor carriers
had to U.S. markets. While the trade
issues with Canada were resolved
quickly, resulting in the moratorium
being lifted for Canada-domiciled motor
carriers, the trade issues with Mexico
were not addressed until the North
American Free Trade Agreement
(NAFTA) was negotiated in the early
1990s. Legislative and executive
extensions have maintained the
moratorium for Mexico-domiciled motor
carriers since 1982.
A number of Mexico-domiciled motor
carriers have been permitted to operate
in the United States because they are
not covered by the moratorium. The
moratorium only applies to new grants
of operating authority. Thus, the
operations of Mexico-domiciled motor
carriers that had obtained unrestricted
operating authority before the
moratorium was enacted were
unaffected by the moratorium.
Additionally, access has been allowed
for certain motor carriers whose
operations fell outside the ICC’s
licensing jurisdiction. These carriers
receive Certificates of Registration by
filing Form OP–2 under the provisions
of what is now 49 CFR part 368. These
carriers include those that operate solely
within the border zones. Also included
among these are certain types of carriers
whose operations are not restricted to
the border zones: U.S.-owned, Mexicodomiciled private carriers; U.S.-owned,
Mexico-domiciled carriers of exempt
goods; and Mexico-domiciled carriers
that only traverse the United States to
deliver or pick up cargo or passengers
in Canada.
The terms of NAFTA, Annex I,
provide that the United States would
incrementally lift the moratorium on
licensing Mexico-domiciled motor
carriers to operate beyond the border
zones. Pursuant to the first phase of
NAFTA, on January 1, 1994, the
President modified the moratorium and
the ICC began accepting applications
from Mexico-domiciled passenger
carriers to conduct international charter

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and tour bus operations in the United
States. In December 1995, ICC
promulgated a rule and a revised
application form for the processing of
Mexico-domiciled property carrier
applications. These rules anticipated the
implementation of the second phase of
NAFTA, providing Mexico-domiciled
property carriers with access to the four
U.S. States bordering Mexico, and the
third phase, providing access
throughout the United States. The ICC
designated the revised application form
OP–1(MX).
Through the ICC Termination Act of
1995 (ICCTA), Congress authorized the
President to remove or modify the
moratorium upon the President’s
determination that such action is
consistent with United States
obligations under a trade agreement or
with United States transportation
policy. The ICCTA also dissolved the
ICC and transferred the authority to
issue new grants of U.S. operating
authority for motor carriers and some
other of its regulatory functions to the
Secretary of Transportation, who
delegated this authority to the Office of
Motor Carriers (OMC) of the Federal
Highway Administration (FHWA).
On December 15, 1995, the
International Brotherhood of Teamsters
(Teamsters) sought an emergency stay of
the ICC rule in the United States Court
of Appeals for the District of Columbia.
The Teamsters contended that the ICC
rule was arbitrary and capricious
because it failed to address concerns
regarding the safe operation of Mexicodomiciled motor carriers. In their
comments on the ICC rule, the
Teamsters had requested the ICC to add
additional safety questions to the
applications filed by Mexico-domiciled
carriers to ensure that the applicants
were willing and able to comply with
applicable safety regulations.
On December 18, 1995, the Secretary
of Transportation announced an
indefinite delay in implementing the
NAFTA motor carrier access provisions.
The Court of Appeals subsequently
denied the Teamsters’ request for an
emergency stay of the ICC rule, which
became an FHWA regulation upon the
termination of the ICC, and set the case
for briefing and argument. After the
Teamsters’ case was briefed and argued,
the court ordered the case held in
abeyance until the Department decided
to commence processing applications of
Mexico-domiciled motor carriers
seeking authority to operate beyond the
border zones. Approximately 190
Mexico-domiciled carriers have filed
OP–1(MX) applications with the
Department.

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Mexico filed complaints against the
United States under NAFTA’s dispute
resolution provisions, challenging the
United States’ decision to deny further
trucking, investment, and bus access.
An arbitration panel comprised of five
individuals with international trade
expertise chosen by the United States
and Mexico met in May 2000 to hear the
trucking and investment case. The
parties engaged in extensive pre- and
post-hearing briefing on safety and legal
issues.
The panel issued a final report on
February 6, 2001, that unanimously
concluded that the blanket refusal to
process applications of Mexicodomiciled motor carriers seeking U.S.
operating authority out of concerns over
the carriers’ safety was in breach of
NAFTA obligations of the United States,
specifically NAFTA’s provisions
ensuring national treatment and mostfavored-nation treatment for crossborder services. The panel also
unanimously decided that the United
States’ refusal to permit Mexican
nationals to invest in U.S. enterprises
that provide transportation of
international cargo within the United
States violated the United States’
NAFTA obligations. In June 2001, the
President lifted this part of the
moratorium.
With respect to its decision on the
U.S. refusal to implement NAFTA’s
truck access provisions, the panel stated
that it did not disagree that truck safety
is a legitimate regulatory objective and
that it was not limiting U.S. application
of its truck safety standards to Mexican
carriers operating in the United States
provided that they are applied in a
manner that is consistent with the
United States’ NAFTA obligations. The
panel noted that compliance with
NAFTA obligations did not require the
granting of operating authority to
Mexican trucking companies that might
be unable to comply with U.S. safety
regulations. The panel observed that the
United States might not be required to
treat applications for operating authority
from Mexican trucking firms in exactly
the same manner as applications from
U.S. or Canadian firms, as long as the
applications are reviewed on a case-bycase basis. The panel stated that to the
extent that Mexican licensing and
inspection requirements might not be
like U.S. requirements, the United
States might be justified in using
methods to ensure Mexican carrier
compliance with the U.S. regulatory
regime that differ from those used for
U.S. and Canadian carriers, provided
that such different methods are used in
good faith to address legitimate safety

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concerns and fully conform with all
relevant NAFTA provisions.
It is important to note that this
interim final rule and the two related
rules published elsewhere in today’s
Federal Register represent only part of
the FMCSA’s effort to ensure the safe
operation of Mexico-domiciled motor
carriers in the United States. For
example, Mexico-domiciled motor
carriers, their vehicles, and their drivers
operating in the United States have been
and will continue to be subject to all of
FMCSA’s safety requirements,
inspection procedures, enforcement
mechanisms, and fines and out-ofservice orders. In addition to being
subject to the various safety audits and
compliance reviews contained in these
rules, these carriers and their vehicles
and drivers will continue to be subject
to roadside vehicle inspections
performed at the border and throughout
the United States by FMCSA inspectors
and their State partners. FMCSA has
received additional funding from
Congress to enhance its inspection
capabilities at the border. The FMCSA
is also conducting seminars in Spanish
for Mexican carriers to help ensure that
they understand U.S. safety
requirements. FMCSA personnel also
expect to continue their cooperative
efforts with their Mexican Government
counterparts toward enhancing
Mexico’s motor carrier regulatory
regime.
The DOT’s Research and Special
Programs Administration (RSPA) has
made considerable progress in
harmonizing the hazardous materials
standards of the United States and
Mexico. Though Mexican hazardous
materials standards are not as
comprehensive as U.S. standards, those
in place are compatible with U.S.
standards.
RSPA has also made significant
strides in educating Mexico-domiciled
hazardous materials shippers and
carriers in hazardous materials safety. In
1993, it translated the U.S. Emergency
Response Guide into Spanish. Since
then, Mexican emergency response
information requirements have been
harmonized with existing U.S.
emergency response information
requirements. The U.S., Mexican and
Canadian Governments now jointly
issue an Emergency Response Guide.
RSPA has also translated various
hazardous materials brochures and
pamphlets into Spanish as well as
identified free hazardous materials
industry resources to assist the Mexican
Government’s Secretaria de
Comunicaciones y Transportes (SCT) in
providing hazardous materials and

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emergency response training for its
inspectors.
Section 350 of the 2002 DOT
Appropriations Act, Public Law 107–87
(Act), prohibits the Secretary of
Transportation from obligating or
expending funds for reviewing or
processing applications of Mexicodomiciled motor carriers for authority to
operate beyond the United States
municipalities and commercial zones on
the United States-Mexico international
border until the FMCSA and DOT
complete several enumerated actions.
Many of the requirements of the Act
have been incorporated into this interim
final rule and the two companion rules
published elsewhere in today’s Federal
Register. Under this interim final rule
FMCSA will: (1) Conduct safety
examinations or audits on Mexicodomiciled carriers seeking authority to
operate beyond the border zones
encompassing the nine areas of inquiry
required by section 350(a)(1)(B); (2)
assign a distinctive U.S. DOT number to
each Mexico-domiciled motor carrier
operating beyond the border zones, in
accordance with section 350(a)(4); (3)
require Mexico-domiciled motor carriers
operating beyond the border zones to
certify that they will have their vehicles
inspected by Commercial Vehicle Safety
Alliance (CVSA)-certified inspectors
every three months, in accordance with
section 350(a)(5); and (4) require
Mexico-domiciled carriers to provide
proof of valid insurance issued by an
insurance company licensed in the
United States before granting them
authority to operate beyond the border
zones, in accordance with section
350(a)(8).
FMCSA invites comments about how
the interim final rule incorporates these
new section 350 provisions into the
application and approval process.
Summary of Notice of Proposed
Rulemaking (NPRM)
The FMCSA proposed changes to its
regulations and application procedures
for Mexico-domiciled motor carriers
desiring to operate within the United
States under the NAFTA liberalized
access provisions in the May 3, 2001
Federal Register (66 FR 22371).
Applicants wanting to conduct
transportation services within the
United States beyond the border zones
would submit a redesigned Form OP–
1(MX). The proposed application
solicited information to indicate the
nature of the operation, demonstrate the
applicant’s knowledge of the basic
requirements of the Federal Motor
Carrier Safety Regulations (FMCSRs)
and describe how it intended to comply
with these regulations. Furthermore, we

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proposed to require each applicant to
make specific certifications of
compliance, such as requiring an
applicant to submit verification from the
Mexican Government that it is a
registered Mexico-domiciled carrier
authorized to conduct motor carrier
operations up to the United StatesMexico border and that all drivers who
operate in the United States have a valid
Licencia Federal de Conductor (LFC)
issued by the Government of Mexico.
The applications would also be subject
to the other procedures set forth in part
365 for applications in the OP–1 series
(e.g., protests and publication in the
FMCSA Register).
Discussion of Comments to the NPRM
In response to the three NPRMs
relating to NAFTA implementation, the
FMCSA received over 200 comments.
Over 90 percent of the comments
opposed the safety monitoring system or
the border opening. Most of the
comments focused on the proposed
safety monitoring system (66 FR 22415)
and will be fully discussed elsewhere in
today’s Federal Register. A large
percentage of the commenters addressed
all three rules together in a single
submission that may have been filed in
one or all three public dockets. We have
carefully considered them and have
revised the Form OP–1(MX) application
form and the regulations governing the
application process as noted in the
preamble sections titled ‘‘Discussion of
the Interim Final Rule’’ and ‘‘Final
Revisions to Form OP–1(MX).’’ In this
section, FMCSA responds to the
comments on Form OP–1(MX) (and
common elements to Form OP–2) and
part 365.
The Friends of the Earth, Natural
Resources Defense Council, Sierra Club,
and Center for International Law
(Friends of the Earth et al.) jointly
commented that FMCSA is required to
perform additional analysis to meet the
requirements of the National
Environmental Policy Act (NEPA) and
Executive Order 13045, concerning the
protection of children from
environmental and health and safety
risks. The International Brotherhood of
Teamsters (Teamsters) also expressed
this viewpoint. The Friends of the Earth
et al. believe that 40 CFR 1501.3(b)
requires that if DOT is not certain that
an environmental impact statement is
required, then it must first prepare an
environmental assessment. Regarding
compliance with Executive Order
13045, the Friends of the Earth et al.
believe that this action presents
increased pollution and safety concerns
that pose a disproportionate risk to
children.

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The FMCSA is preparing an agency
order to meet the requirements of DOT
Order 5610.1C (that establishes the
Department of Transportation’s policy
for compliance with NEPA by the
Department’s administrations). The
FMCSA has conducted a programmatic
environmental assessment (PEA) of the
three rulemakings in accordance with
the DOT Order and the regulations of
the Council on Environmental Quality.
A discussion of the PEA and its findings
and the FMCSA’s responsibilities under
E.O. 13045 is presented later in the
preamble under ‘‘Regulatory Analyses
and Notices.’’ A copy of the PEA is in
the docket to this rulemaking.
The Attorney General for the State of
California submitted a comment in
which he asserted that the FMCSA
would be required to perform a
‘‘conformity determination’’ pursuant to
the Clean Air Act (CAA), before
finalizing these rulemakings. Under the
CAA, Federal agencies are prohibited
from supporting in any way, any
activity that does not conform to an
approved State Implementation Plan
(SIP), (42 U.S.C. 7006). EPA regulations
implementing this provision require
Federal agencies to determine whether
an action would conform with the SIP
(a ‘‘conformity determination’’), before
taking the action (40 CFR 93.150). The
Attorney General asserts that the
FMCSA must make a conformity
determination before taking final action
to implement regulations that would
allow Mexican trucks to operate beyond
the border. The Attorney General
provided technical information to
support his assertion that allowing
Mexican trucks to operate beyond the
border would likely not be in
conformity with California’s SIP.
We have reviewed our obligations
under the CAA, and believe that we are
in compliance with the general
conformity requirements as
implemented by the U.S. Environmental
Protection Agency (EPA). EPA’s
implementing regulations exempt
certain actions from the general
conformity determination requirements.
Actions which would result in no
increase in emissions or clearly a de
minimis increase, such as rulemaking
(40 CFR 93.153(c)(iii)), are exempt from
requiring a conformity determination. In
addition, actions which do not exceed
certain threshold emissions rates set
forth in 40 CFR 93.153(b) are also
exempt from the conformity
determination requirements. The
FMCSA rulemakings meet both of these
exemption standards. First, as noted
elsewhere in this preamble to this rule,
the actions being taken by the FMCSA
are rulemaking actions to improve

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FMCSA’s regulatory oversight, not an
action to modify the moratorium and
allow Mexican trucks to operate beyond
the border. Second, the air quality
impacts from each of the FMCSA’s rules
neither individually nor collectively
exceed the threshold emissions rates
established by EPA (see Appendix C of
the Environmental Assessment
accompanying these rulemakings for a
more detailed discussion of air quality
impacts). As a result, we believe that
FMCSA’s rulemaking actions comply
with the CAA requirements, and that no
conformity determination is required.
The American Insurance Association
(AIA) commented that the OP–1(MX)
form does not make clear the fact that
layered insurance filings (primary and
excess securities) are acceptable. The
AIA suggested modifying the form to
make it clear. The FMCSA does not find
this modification to be necessary
because the acceptability of layered
insurance filings is clearly explained in
49 CFR part 387, subpart C.
The International Brotherhood of
Teamsters (Teamsters) commented that
the financial responsibility section of
the form should be modified to make
clear that we would not grant
provisional operating authority until we
receive the appropriate filings for
financial responsibility and service of
process agents from the applicant and
its financial responsibility agent(s). The
AFL–CIO’s Transportation Trades
Department (TTD) commented that
various statements and certifications
could be made more understandable.
The FMCSA will verify that a carrier has
the necessary financial responsibility as
part of the pre-authorization safety
audit. However, there will be no DOT
number issued at that time under which
a filing may be made. Therefore, we will
permit insurance companies to file
evidence of insurance with FMCSA after
provisional authority is granted.
However, provisional operating
authority will not be valid, and the
carrier may not operate under that
authority, until an insurance filing is
made with, and accepted by, the agency.
This is consistent with the procedure
applicable to U.S. and Canadian carriers
required to obtain operating authority
under 49 U.S.C. 13901. In a similar vein,
we are giving applicants the option of
including with the application a
notification that a process agent service
will electronically file the necessary
process agent information within 90
days. As is the case with U.S. and
Canadian carriers subject to 49 U.S.C.
13901, a Mexico-domiciled carrier may
not operate in the United States until
the process agent filing is made with,
and accepted by, the agency.

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United Parcel Service (UPS)
commented that the application and
regulations for Mexico-domiciled
carriers requesting operating authority
should identify express delivery as a
separate kind of carrier operation. UPS
explains that this distinction would
enable the United States to accelerate
the timeline for lifting the moratorium
for express delivery services, without
awaiting action on general trucking.
We do not see the need at this time
for the rules to distinguish between
express delivery services and general
trucking services. We do not expect that
the moratorium will be lifted for express
delivery services before the lifting of the
moratorium on general trucking. In
addition, the United States maintains a
reservation under the NAFTA on the
transportation of goods other than
international cargo between points in
the United States, and the reservation
covers both express delivery services
and other motor carrier services.
The Owner-Operator Independent
Drivers Association, Inc. (OOIDA) and
the California Trucking Association
(CTA) recommended that the form
specify the additional U.S. laws to
which Mexico-domiciled carriers would
be subject. The OOIDA commented that
since NAFTA requires Mexicodomiciled carriers to comply with U.S.
laws and all applicable State laws when
operating within the United States, the
FMCSA should set forth the particular
U.S. laws to which applicants are
subject. They believe form references to
other laws are too vague and should be
more fully enumerated. The CTA
recommends modifying the form to
require an applicant to certify that it
will comply with the laws of other U.S.
agencies.
The FMCSA believes that it is beyond
the scope of this rulemaking to provide
an exhaustive listing and explanation on
the OP–1(MX) form of all Federal and
State laws to which carriers are subject
when operating within the United
States. However, we are conducting
information sessions for potential
applicants where, among other things,
we discuss additional information
provided by other Federal agencies and
State registration requirements. This
information will also be on the FMCSA
web site.
We have worked closely with other
Federal agencies, including the U.S.
Department of Labor (DOL), U.S.
Environmental Protection Agency (EPA)
and others, in drafting and clarifying the
statement that appears after the
signature line of Section VIII—
Compliance Certifications. This
statement underscores the importance of
complying with all pertinent Federal,

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State, local and tribal statutory and
regulatory requirements, including
labor, environmental, and immigration
laws. Such compliance includes
producing requested records for review
and inspection. It also includes
compliance by drivers who must meet
the requirements under the Immigration
and Nationality Act, 8 U.S.C. 1101 et
seq., and pass inspection by inspectors
of the Immigration and Naturalization
Service at the port of entry.
The American Trucking Associations,
Inc. (ATA), OOIDA, the Teamsters, and
the TTD expressed concern that the
hazardous materials requirements listed
in the safety certification statements
were incomplete, suggesting a more
comprehensive listing of requirements,
including the hazardous material
registration requirement. They
suggested additional hazardous
materials documentation to be
submitted with the application. The
Transportation Lawyers Association
(TLA) believes that the current and
proposed application procedures have a
loophole regarding identification of
hazardous materials carriers. It contends
that the ‘‘check the block’’ system, and
the fact that none of the information
described in the hazardous materials
certification statements must be
submitted with the application, enable
the hazardous materials transporter to
escape detection. Neither the form nor
application procedures require a carrier
who later decides to transport
hazardous materials to notify the
FMCSA or provide evidence of
knowledge of hazardous materials
standards—only to increase the amount
of insurance carried.
We have corrected and modified the
hazardous material certifications in
response to these comments. The
hazardous materials certification
statements have been revised to more
thoroughly reference applicable
hazardous materials requirements and
request the supplemental information
required by the Hazardous Materials
Regulations. Please reference the section
‘‘Final Revisions to the Form OP–
1(MX)’’ for a detailed discussion of
revisions to the certification statements.
Information regarding hazardous
materials operations will be verified
during the pre-authorization safety audit
established in this interim final rule
pursuant to section 350 of the DOT
Appropriations Act.
Section 350 of the Act prohibits
Mexico-domiciled motor carriers from
transporting hazardous materials in a
placardable quantity beyond the border
zones until the United States has
completed an agreement with the
Government of Mexico ensuring that

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drivers of such placardable quantities of
hazardous materials meet substantially
the same requirements as U.S. drivers
carrying such materials. Section 1012(b)
of the ‘‘Uniting and Strengthening
America by Providing Appropriate
Tools Required to Intercept and
Obstruct Terrorism Act of 2001’’ (USA
PATRIOT Act) [Pub. L. 107–56, October
26, 2001] amended the Hazardous
Materials Transportation Act (49 U.S.C.
5101–5127) and the Commercial Motor
Vehicle Safety Act of 1986 (49 U.S.C.
31301–31317) by placing limitations on
the issuance or renewal of hazardous
materials licenses. (The DOT interprets
the term ‘‘hazardous materials licenses’’
to mean a hazardous materials
endorsement for a commercial driver’s
license because of the reference to
section 31305 in section 1012(b).) The
OP–1(MX) form will require additional
information regarding cargo tank
certification, hazardous materials
training, and persons responsible for
ensuring compliance with the
Hazardous Materials Regulations.
The CTA commented that the FMCSA
should distribute an applicant’s Single
State Registration System (SSRS) filing
to the appropriate SSRS members. The
FMCSA does not have the resources to
coordinate the SSRS filings for Mexicodomiciled carriers. We have also
removed specific references to the SSRS
from the form instructions (although the
requirement still remains), because it is
one of many State requirements. We do
not wish to imply that the SSRS
requirement is the sole State
requirement for Mexico-domiciled
carriers or that it has greater importance
than other laws or regulations.
The TLA commented that the
definition of private carrier in the
instructions to the application form
includes a phrase that has historically
described a for-hire carrier and suggests
that the form be modified. In Section III
of the instructions, a motor private
carrier is defined as an entity that is
‘‘transporting its own goods, including
an entity that is performing such
operations under an agreement or
contract with a U.S. shipper or other
business.’’
This definition is an attempt to
rephrase, in plain language, the text of
49 U.S.C. 13102(7). Section 13102(7)
defines foreign motor private carrier to
include persons (except motor carriers
of property or motor private carriers)
that provide interstate transportation of
property by motor vehicle under
agreements or contracts with persons
who are not motor carriers of property
or motor private carriers. The form
instructions may be confusing because
they do not reference the for-hire motor

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carrier exclusion in defining a private
carrier. Therefore, we have modified the
form to provide clarity.
Camara Nacional del Autotransporte
de Cargo (CANACAR) commented that
we must more fully explain the need for
a process agent in the United States and
link this requirement directly to safety
and NAFTA. CANACAR believes we
should require only one process agent in
the United States. It commented that
requiring more than one would violate
NAFTA.
Contrary to CANACAR’s suggestion,
nothing in the NAFTA limits the rights
of the United States to require firms to
designate more than one process agent.
Requiring Mexico-domiciled carriers to
comply with 49 CFR part 366 would not
violate NAFTA because the same
requirement applies to U.S. and
Canadian motor carriers. A process
agent service may be used to maintain
service of process agents in multiple
States, thus eliminating the need for
carriers themselves to retain agents in
each State. A process agent service is an
association or corporation that files with
the FMCSA a list of process agents for
each State in which the carrier intends
to operate.
CANACAR believes that FMCSA must
remove registration requirements for
agricultural, private, and exempt
carriers, because we do not require U.S.
and Canadian agricultural, private, and
exempt carriers to register under 49
U.S.C. chapter 139.
The Motor Carrier Safety Act of 1984,
Public Law 98–554, 98 Stat. 2832,
required Mexican motor carriers
conducting operations otherwise
exempt from the economic regulation
requirements (i.e., for-hire carriers of
exempt commodities, agricultural and
private carriers) to register with the
Interstate Commerce Commission to
conduct operations in the United States.
These requirements are an important
element of FMCSA’s effort to ensure the
safe operation of Mexican motor carriers
on U.S. highways. From a safety
standpoint, there is no distinction
between agricultural, private, and
exempt carriers and the Mexican
carriers that would otherwise be
required to register.
CANACAR also believes that the OP–
1(MX) and OP–2 form questions about
affiliates will violate section 219 of the
Motor Carrier Safety Improvement Act
(MCSIA), which it interprets to mean
that ‘‘once NAFTA is implemented’’
questions about affiliates would no
longer be needed. CANACAR
commented that section 219 of MCSIA
only applies to ‘‘carriers’’ and not
‘‘nationals.’’

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The FMCSA will continue to require
OP–1(MX) applicants to submit
information on affiliations because it is
useful in deterring operations by
disqualified carriers. Section 219 of
MCSIA authorizes FMCSA to penalize
and disqualify foreign motor carriers for
operating beyond the border zones
before the implementation of NAFTA,
but it does not prohibit enforcement
after NAFTA’s implementation (nor the
collection of information on a foreign
carrier’s affiliations). FMCSA requires
similar information from U.S. and
Canadian applicants to ensure that
unsafe carriers do not evade out-ofservice orders or registration
suspensions by continuing operations
under a different identity.
The Free Trade Alliance San Antonio
recommends that we provide a sample
completed OP–1(MX) form, including
attachments, as a guide to applicants.
The FMCSA will address this comment
in training materials and in our
workshops for potential applicants.
The TLA commented that the
proposed forms require a carrier
operating ‘‘small vehicles (GVWR under
10,000 pounds)’’ to certify that ‘‘it is
exempt from the U.S. DOT Federal
Motor Carrier Safety Regulations * * *
.’’ The TLA believes that the
certification does not accurately reflect
the accompanying instructions stating
that an ‘‘exempt’’ carrier ‘‘must certify
that [it is] familiar with and will observe
general operational safety fitness
guidelines and applicable State and
local laws relating to the safe operation
of commercial motor vehicles.’’ The
TLA further commented that the safety
certification mentioned in the
instructions was originally authored by
the ICC in response to comments filed
by it in Ex Parte No. 55 (Sub-No. 94),
Revision of Application Procedures and
Corresponding Regulation, 10 ICC 2d
386, 398–399 (1994). The TLA
commented that certification that a
carrier who is exempt from the FMCSRs,
‘‘will observe’’ applicable Texas State
Law is meaningless. The TLA believes
that local law has no ability to influence
a carrier’s adherence to good highway
safety practices beyond its extremely
limited reach.
Carriers that are exempt from direct
DOT oversight-because they operate
smaller vehicles which generally
operate only locally and do not pose a
significant enough public threat to
warrant Federal involvement-are
nonetheless subject to State safety
oversight. Many MCSAP States have not
fully exempted smaller vehicles from
their safety oversight and are not
required to exempt them under MCSAP.
Consistent with the Congressional

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mandate that safety is our highest
priority, the FMCSA will require that
OP–1(MX) applicants certify their
willingness to inform themselves
concerning any State, local and tribal
safety laws to which they are subject
and to pledge to abide by them.
The Teamsters commented that
instead of the check boxes on the form,
we should require narratives describing
systems and procedures that the
applicant now uses or intends to use in
the future. They contend that all
applicants should be required to submit
accident records with the applications
and that ‘‘* * * (A)ny responsible
carrier would have the information
required to compile such a record at the
time the application is prepared’’ even
if it had not been maintaining an
accident record as such. The TLA
recommends that we require a narrative
response about the content of an
applicant’s household goods arbitration
program.
The FMCSA will evaluate information
provided in the OP–1(MX) form and
will conduct a safety audit of each
carrier before deciding to grant
provisional operating authority and
allowing it to commence operations in
the United States. Requests for
additional narrative descriptions have
been restricted to information necessary
to evaluate an applicant’s willingness
and ability to comply with our safety
standards and are not meant to be overly
burdensome. The FMCSA will not
burden Mexico-domiciled carriers with
a requirement to provide a narrative
description of their household goods
arbitration programs because it is not
critical to the safety mission of the
agency and can be evaluated during the
pre-authorization safety audit.
The Teamsters and Public Citizen
commented that applicants should
complete a proficiency exam testing
their knowledge of the FMCSRs as a part
of the application procedure, as allowed
by MCSIA. The FMCSA does not find it
necessary to require a proficiency exam
at this time given the detailed
requirements of this interim final rule.
These detailed requirements include the
application, including safety
certifications, the pre-authorization
safety audit, and the requirement in the
Act that Mexico-domiciled commercial
vehicles be inspected at each border
crossing during the time they hold
provisional authority and until they
hold permanent authority for three
consecutive years, unless the vehicles
have a current CVSA inspection sticker
affixed to the vehicle. Identifying the
appropriate company individual to take
the proficiency test would be
problematic as well. In addition, it is

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not clear that a proficiency exam
requirement would meaningfully
enhance safety because it would only
test the ‘‘proficiency’’ of a single carrier
employee.
The Teamsters also commented that
we should require financial reporting
based on the Mexico-domiciled
applicant’s prior year revenue. Since the
nature of a Mexico-domiciled carrier’s
business within Mexico may be
unrelated to planned operations within
the United States, that information
might not be valid for the purpose of
evaluating its fitness to operate within
the United States. FMCSA also believes
this suggestion is outside of the scope of
this rulemaking and FMCSA
jurisdiction.
Public Citizen believes the proposed
application process for Mexicodomiciled trucks will not ensure
compliance for several reasons. First,
the SCT database to be used in
evaluating a Mexico-domiciled carrier’s
safety fitness is ‘‘unpopulated’’ and
‘‘currently lacks the basic information
necessary to process applications or to
perform a safety review.’’ It proposes as
a precondition for granting operating
authority that FMCSA set minimum
levels of inspection, crash, and other
performance and enforcement data to be
amassed for an applicant. For example,
there must be sufficient data to calculate
a score in Safestat(tm), the information
system used to determine a domestic
carrier’s safety fitness. Public Citizen
also believes that information reported
on the form may be distorted through
error or fraud, and the driver’s safety
records may not be available. It
commented that insurance and proof of
insurance requirements are dangerously
inadequate to protect other drivers on
public highways.
The SCT database inquiry is but one
component of the planned safety
evaluation of OP–1(MX) applicants. The
FMCSA will use information in its own
databases and will conduct a preauthorization safety audit to validate an
applicant’s responses and assess its
safety fitness. Furthermore, the
insurance requirements for Mexicodomiciled carriers are identical to those
applicable to domestic and Canadian
carriers. Minimum levels of financial
responsibility are set forth in 49 CFR
part 387. The FMCSA will verify proof
of financial responsibility during the
pre-authorization safety audit.
Furthermore, a Mexico-domiciled
carrier will be unable to operate in the
United States beyond the border zones
unless evidence of adequate financial
responsibility is filed with the FMCSA
by an insurance company licensed in
the United States. Evidence of insurance

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must also be maintained on the motor
vehicle when operating within the
United States and border inspectors will
verify proof of financial responsibility
electronically by checking the FMCSA’s
insurance database.
The CTA commented that applicants
should file proof of insurance with the
application, rather than after FMCSA
grants the applicant operating authority.
Current 49 CFR part 387 requires the
insurer, not the applicant, to make
insurance filings with the FMCSA. This
requirement allows insurance
companies to retain control of the
insurance certification documents,
thereby significantly decreasing
opportunities for fraudulent activity.
Section 350(a)(8) of the Act, however,
requires the FMCSA to verify proof of
financial responsibility with a financial
responsibility provider licensed in the
United States during the preauthorization safety audit. Although
FMCSA will independently verify a
Mexico-domiciled motor carrier
applicant’s proof of financial
responsibility during the preauthorization audit, the carrier will not
have been issued a DOT number under
which a filing may be made. Therefore,
we will not require actual filing of the
insurance at the time of the audit.
However, once the carrier is granted
provisional operating authority, it must
have evidence of acceptable insurance
on file with the FMCSA before it may
operate within the United States.
A number of parties, including
OOIDA, Public Citizen, and the
Teamsters, urged that Mexico-domiciled
motor carriers should not be allowed to
operate beyond the border zones at this
time, citing what they view as an
inadequate Mexican Government motor
carrier safety infrastructure, inadequate
inspection facilities at border crossings,
and other factors. The Teamsters, for
example, note that for these reasons full
implementation of NAFTA’s motor
carrier access provisions is premature
and urge FMCSA to ‘‘postpone the
border opening.’’
FMCSA believes that the regulations
being published today, and the other
safety measures the agency is taking
with respect to Mexico-domiciled motor
carriers operating outside the border
zone, will give the agency sufficient
assurance that these carriers are capable
of complying with U.S. safety standards,
notwithstanding any shortcomings in
the Mexican Government’s motor carrier
safety infrastructure. FMCSA also
believes that, in conjunction with its
State partners, it will be able to
maintain an adequate safety inspection
program at the border. It should be
noted, however, that these and other

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comments urging a delay in the
implementation of NAFTA assume that
the regulations published today ‘‘open
the border’’ or lift the current
moratorium on the granting of operating
authority. The regulations do neither.
The President, not the FMCSA, has that
authority pursuant to 49 U.S.C. 13902.
The President has announced that the
United States will comply with its
NAFTA obligations regarding Mexicodomiciled motor carrier access in a
manner that will not weaken motor
carrier safety. The regulations help
ensure motor carrier safety in
anticipation of presidential action lifting
the moratorium.
In addition, section 350(c)(1) of the
Act requires the DOT Inspector General
(OIG) to conduct a comprehensive
review of FMCSA border operations
before the FMCSA may spend any
Federal funds to review or act on OP–
1(MX) applications. The OIG must
assess whether the statutory
requirements have been met to ensure
the opening of the border does not pose
an unacceptable safety risk to the
American public. Section 350(c)(2) also
requires the Secretary of Transportation
to certify in writing in a manner
addressing the Inspector General’s
findings that the opening of the border
does not pose an unacceptable safety
risk to the American public before the
FMCSA may spend any Federal funds to
review or act on OP–1(MX)
applications.
ABA and Greyhound urge that we not
implement our motor carrier-related
NAFTA obligations until Mexico
reciprocates by implementing its motor
carrier-related NAFTA obligations.
Again, none of the regulations
published today ‘‘open the border’’ or
lift the current moratorium on the grant
of operating authority. In any event,
NAFTA itself provides procedures to
ensure that each party fulfills its
obligations under the Agreement.
In response to comments about the
need for ensuring that vehicles operated
by Mexico-domiciled motor carriers
comply with the applicable Federal
Motor Vehicle Safety Standards
(FMVSS), we note that enforcement of
these safety standards by FMCSA and
its State partners will be accomplished
through roadside inspections, including
inspections at the border. Roadside
inspections provide a means of ensuring
that vehicles meet the applicable
FMVSSs in effect on the date the vehicle
was manufactured.
Title 49 CFR part 393 of the FMCSRs
currently includes cross-references to
most of the FMVSSs applicable to heavy
trucks and buses. The rules require that
motor carriers operating in the United

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States, including Mexico-domiciled
carriers, must maintain the specified
safety equipment and features that the
National Highway Traffic Safety
Administration (NHTSA) requires
vehicle manufacturers to install. Failure
to maintain these safety devices or
features is a violation of the FMCSRs. If
the violations are discovered during a
roadside inspection, and they are
serious enough to meet the current outof-service criteria used in roadside
inspections (i.e., the condition of the
vehicle is likely to cause an accident or
cause a mechanical breakdown), the
vehicle would be placed out of service
until the necessary repairs are made.
The FMCSA also has the option of
imposing civil penalties for violations of
49 CFR part 393. Any FMVSS violations
that involve noncompliance with the
standards presently incorporated into
part 393 could subject motor carriers to
a maximum civil penalty of $10,000 per
violation. If the FMCSA determines that
Mexico-domiciled carriers are operating
vehicles that do not comply with the
applicable FMVSSs, this information
could be used to take appropriate
enforcement action for making a false
certification on the application for
operating authority.
The FMCSA and NHTSA are
initiating several regulatory actions
(published elsewhere in today’s Federal
Register) to ensure that labeling
requirements of the FMVSSs are
enforced against motor vehicles entering
the United States. The FMCSA is
proposing to amend the FMCSRs to
require that all motor carriers ensure
that their CMVs have a certification
label that meets the requirements of 49
CFR part 567, applied by the vehicle
manufacturer or by a registered
importer. United States motor carriers
typically would only have access to
vehicles that meet the applicable
FMVSSs and have a certification label
that meets the requirements of 49 CFR
part 567, but Mexico-domiciled and
Canada-domiciled carriers purchasing
vehicles for operation within their
respective countries may be using
vehicles which have not been certified
as FMVSS-compliant.
The FMCSA is proposing that U.S.
motor carriers comply with the
certification label proposal on the
effective date of the FMVSS certification
rule. The agency is also proposing that
foreign motor carriers that begin
operations in the United States on or
after the effective date of the
certification label rule, or expand their
operations to go beyond the border
zones for the first time, ensure that all
CMVs used in the new or expanded
operations have the necessary

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certification label before entering the
United States. All other Canada and
Mexico-domiciled motor carriers
operating in the United States prior to
the effective date of the interim final
rule would be allowed 24 months to
bring their vehicles into compliance
with the certification requirements.
NHTSA is taking three separate
actions relating to the certification label.
The first action is publication of a
policy statement that addresses
commercial motor vehicles that were
not originally manufactured for sale in
the United States, and thus were not
required at the time of manufacture to
be certified as complying with the
FMVSSs, but are subsequently sought to
be imported into the United States. The
statement provides that a vehicle
manufacturer may, if it has sufficient
basis for doing so, retroactively apply a
label to a commercial motor vehicle
certifying that the vehicle complied
with all applicable FMVSSs in effect at
the time it was originally manufactured.
NHTSA recognizes that there are
many commercial motor vehicles used
by motor carriers in Mexico and Canada
that were manufactured in accordance
with the FMVSSs, but were not certified
as complying with those standards
because the vehicles were manufactured
for sale in Canada or Mexico. NHTSA is
proposing two additional actions related
to the FMVSS and foreign-domiciled
motor carriers. The first would establish
recordkeeping requirements for foreign
manufacturers that retroactively certify
vehicles. The second would codify, in
49 CFR Part 591, its long-standing
interpretation of the term ‘‘import,’’ as
used in the National Traffic and Motor
Vehicle Safety Act of 1966, Public Law
89–563, to include bringing a
commercial motor vehicle into the
United States for the purpose of
transporting cargo or passengers.
Discussion of the Interim Final Rule
The FMCSA has made changes in this
interim final rule to the proposed
revisions to part 365, based on the
comments, section 350 of the 2002 DOT
Appropriations Act, and our own
review of the proposal.
Section 365.503 has been revised to
allow both hard copy and electronic
submission of required information on
designation of process agents (Form
BOC–3) as part of the application
process. The FMCSA currently allows
only process agent services to
electronically file the Form BOC–3. If a
carrier elects to use a process agent
service, it must include a letter to that
effect with the Form OP–1(MX) and
ensure that the service electronically
files the Form BOC–3 with the FMCSA.

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Otherwise, the hard copy Form BOC–3
must accompany the application. The
carrier may not begin operations until
the Form BOC–3 has been filed with the
FMCSA.
Section 365.505 has been revised to
extend to 18 months the deadline for
filing Form OP–1(MX) by carriers
holding a Certificate of Registration
issued before April 18, 2002,
authorizing operations beyond the
municipalities along the U.S.-Mexico
border and beyond the commercial
zones of such municipalities. These
carriers, as well as those carriers who
filed the previous version of the OP–
1(MX) application form, do not need to
submit another fee when filing a new
OP–1(MX) application. The FMCSA
may suspend or revoke the Certificate of
Registration of any carrier that fails to
comply with this re-registration
requirement and 18-month deadline.
Certificates of Registration issued before
April 18, 2002, will remain valid until
the FMCSA acts on the newly submitted
OP–1(MX) application.
The FMCSA has revised the heading
of § 365.507 in both the table of sections
and the regulatory text to ‘‘FMCSA
action on the application’’ to accurately
reflect how the FMCSA will consider
and act on each application. The section
now provides that the FMCSA will
validate all data and certifications in an
application with information in its own
databases, in the appropriate databases
of the Mexican Government to which it
has access as part of the NAFTA
implementation process, and with
information discovered during a preauthorization safety audit. The FMCSA
will grant provisional operating
authority if it determines that the
application and the results of the safety
audit are consistent with the FMCSA’s
safety fitness policy. The safety fitness
criteria published in new Appendix A
to part 365 for the pre-authorization
safety audit is similar to the safety
fitness criteria for post-operational
safety audits for Mexico-domiciled
carriers in new Appendix A to part 385
that is being published elsewhere in
today’s Federal Register. We will also
assign a distinctive USDOT Number that
distinguishes the carrier as a Mexicodomiciled carrier authorized to operate
beyond the border zones.
In the companion rule establishing a
safety monitoring system for new
entrant Mexico-domiciled carriers
(published elsewhere in today’s Federal
Register), FMCSA will require
commercial motor vehicles to have a
valid CVSA inspection decal denoting a
successful inspection of the commercial
motor vehicle at all times while
operating under provisional operating

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authority in the United States beyond
the border zones. Provisional authority
to operate beyond the border zones
cannot become permanent for at least 18
months, until the carrier has
successfully completed an 18-month
safety monitoring program, including a
compliance review resulting in the
assignment of a Satisfactory safety rating
as required by § 350(a)(2) of the 2002
DOT Appropriations Act.
Section 365.511 has been added in
response to the 2002 DOT
Appropriations Act. This section will
require that a Mexico-domiciled carrier
must continue to seek out and have
CVSA inspectors perform CVSA Level I
inspections for the first three
consecutive years after being granted
permanent operating authority.
We have made conforming
amendments to §§ 365.101(h) and
365.105(a). We revised § 365.101(h) to
reflect the expanded scope of operations
authorized by the Form OP–1(MX)-from
Mexico to all points in the United
States. The previous reference to the
four border States was originally
designed to register applicants to
operate from Mexico to points only
within the border States of California,
Texas, Arizona and New Mexico.
There are three revisions to
§ 365.105(a). First, we have specified
that household goods carriers and motor
passenger carriers are required to submit
the OP–1(MX) when applying to operate
within the United States beyond the
border zones. The previous regulations
generally required motor property
carriers to use the form. Next, we
removed an obsolete reference to Form
OP–1(W) because we do not have
authority to register water carriers.
Finally, we updated the cross-reference
to filing fee requirements to reflect the
recodification of these requirements in
49 CFR part 360.
Revisions to Form OP–1(MX)
The interim final rule reflects
numerous typographical corrections and
adjustments to the OP–1(MX)
application form to make it consistent
with the OP–2 form. All requests for
supplemental information that must
accompany the application are in bold
typeface so that they are conspicuous to
the applicant. The substantive revisions
are discussed below.
The OP–1(MX) application
instructions have been revised to
discontinue the requirement that
applicants submit Internal Revenue
Service (IRS) Form 2290, Schedule 1
(Schedule of Heavy Highway Vehicles)
with the OP–1(MX) application. Unlike
the OP–1(MX) application procedure,
taxes imposed by 26 U.S.C. 4481 are

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assessed annually. The IRS Form 2290
would only provide evidence of
compliance for the current year.
However, the applicant must still certify
compliance with 26 U.S.C. 4481 under
Section VIII of the application.
The instructions clarify the definition
of ‘‘applicant’’ for purposes of
determining who must sign the various
certifications and the Section IX—
Application Oath.
Next, applicants are cautioned to
enter only the city code and telephone
numbers when listing Mexican
telephone numbers on the form because
previous applicants often submitted
invalid or incomplete telephone
numbers.
Under the Insurance Instructions, we
emphasize that although evidence of
coverage is not required at the time the
application is submitted, a carrier has
up 90 days after filing an OP–1(MX)
application to submit proof of financial
responsibility.
The information on how to receive
additional assistance in completing the
Forms OP–1(MX) and MCS–150 was
revised to list a toll-free telephone
number accessible from Mexico. We
also updated the information for
obtaining assistance with hazardous
materials registration procedures and
regulations.
The instructions also state that
applicants that use a process agent
service to designate multiple agents for
service of process must attach a letter to
the application informing the FMCSA of
this option. The applicant must also
ensure that the service electronically
files the Form BOC–3 with the FMCSA
within 90 days after submitting the
application. The applicant is also
notified that it may not begin operations
in the United States until the Form
BOC–3 has been filed with FMCSA.
The FMCSA has modified Section IA
to add a question asking applicants
whether they previously held
provisional operating authority that was
revoked. If that is the case, the applicant
must show how it has corrected the
deficiencies that resulted in the
revocation, explain what effectively
functioning basic safety management
systems it now has in place, and
provide any information and documents
that support its arguments.
The FMCSA has corrected references
in Section IA, and in the corresponding
instructions, to an ‘‘SCT registration
number.’’ An applicant must be
registered with SCT to be issued
operating authority. However, the SCT
does not issue an SCT registration
number. It uses the RFC number, a
Mexican Federal Taxpayer Registration
identifier issued by a separate

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Government agency, to track the
carrier’s information in the SCT
database. A company is issued a
Registro Federal de Contribuyente;
individuals are issued a Registro Federal
de Causante. The applicant must
complete Question 5a under Section IA
based upon the applicant’s form of
business: (1) if the applicant is a sole
proprietorship, enter the Registro
Federal de Causante; (2) all other
business forms should complete
Question 5a using the Registro Federal
de Contribuyente.
We have deleted a redundant question
regarding the applicant’s domicile from
Section IA and Ownership and Control
information from Section II. This
information was used to substantiate
claims that a carrier was U.S.-owned or
controlled and therefore eligible to
operate beyond the border zones under
a Certificate of Registration. With the
implementation of NAFTA’s access
provisions, Mexico-domiciled carriers
applying to operate beyond the border
zones will no longer file the OP–2 form.
They must file an OP–1(MX), and
ownership and control information will
not be the basis for granting authority.
Several safety certifications have been
modified or added to Section V. The
safety certification for applicants that
are exempt from the Federal Motor
Carrier Safety Regulations because of
the weight of their vehicles and because
they will not transport hazardous
materials (as was discussed in the
proposed form instructions but
inadvertently omitted from the
proposed form) has been restored. These
applicants must certify that they will
observe safe operating practices and
comply with applicable State, local and
tribal safety laws.
Under Driver Qualifications,
applicants must certify, consistent with
49 CFR 391.23, that they will investigate
their drivers’ 3-year employment and
driving histories. The certification
statement concerning the need for
carriers to establish a system and
instructions for drivers to report
criminal convictions has been removed.
Current regulations only require
domestic drivers to report violations of
motor vehicle traffic laws and
ordinances. The certification statement
relating to the use of properly licensed
drivers has been modified to require
that the driver’s Licencia Federal de
Conductor be registered in the SCT
database.
The four certification statements
proposed under certification section
V.8, pertaining to requirements that
must be in place once operations within
the United States have begun, have been
modified to emphasize that they are

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post-operational requirements and have
been integrated into the Hours of
Service, Driver Qualifications, and
Vehicle Condition certification sections,
as appropriate.
In response to comments from the
ATA, Teamsters, OOIDA, and the TTD,
we have extensively revised the
Hazardous Materials (HM) and Cargo
Tank certification statements. The HM
training certification was modified to
cite the relevant HM training regulations
(49 CFR part 172, subpart H and 49 CFR
177.816) and the specific hazardous
materials safety compliance information
that must accompany the application.
We reworded the certification
statement regarding the establishment of
a system and procedures for inspecting,
repairing and maintaining ‘‘vehicles for
HM transportation in a safe condition.’’
The Hazardous Materials Regulations
(HMR) require a system and procedures
for inspection, repair and maintenance
of reusable hazardous materials
packages in a safe condition. The
vehicle inspection, repair and
maintenance requirement is covered in
the Vehicle Condition certification
statements.
We added a new certification
statement requiring carriers to ensure
that all HM vehicles are marked and
placarded in compliance with 49 CFR
part 172, subparts D and F.
The HM registration certification
statement, which is not restricted to
Cargo Tank carriers, has been corrected
and moved to the Hazardous Materials
section.
The Section VIII—Compliance
Certification statement concerning
process agent(s) has been modified to
replace the phrase ‘‘judicial filings and
notices’’ with ‘‘filings and notices.’’ Two
new Compliance Certification
statements have been added. In the first,
responsive to section 350(a)(5) of the
DOT Appropriations Act, the applicant
must certify it is willing and able to
have all vehicles operated in the United
States inspected at least every 90 days
by a certified CVSA inspector and have
decals affixed attesting to satisfactory
compliance with Level I CVSA
Inspection criteria. This provision will
require a Mexico-domiciled motor
carrier to seek out a qualified CVSA
inspector to conduct a CVSA inspection
at least every 90 days until it has
operated under permanent authority for
at least 3 consecutive years. Mexicodomiciled carriers should seek out and
have Mexico-domiciled CVSA
inspectors perform such inspections in
Mexico before the carrier sends its
vehicles to United States ports of entry.
This will help the carriers to minimize
disruptions to the efficient use of their

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vehicles, minimize time in the U.S.
ports of entry, and provide a more
efficient border crossing enroute to its
U.S. and Canadian destinations.
The second compliance certification
added to Section VIII is designed to
ensure that Mexico-domiciled carriers
whose registration has been suspended
or revoked are not reapplying for
operating authority while under
suspension or sooner than 30 days after
the date of revocation, as prohibited in
part 385 subpart B. A signature line also
has been placed beneath the
Compliance Certification statements,
consistent with Section V—Safety
Certifications and Section VI—
Household Goods Arbitration
Certifications.
Certain other changes were made to
the Section VIII—Compliance
Certifications after discussions with the
U.S. Department of Labor and the U.S.
Environmental Protection Agency. The
proposed Form OP–1(MX) included a
certification that the applicant is willing
and able to comply with U.S. labor laws.
Although the certification is included in
a section that is prefaced by the
direction ‘‘All applicants must certify as
follows:’’, the instructions for the form,
after first stating that FMCSA
considered compliance with labor laws
to be ‘‘extremely important,’’ then
indicated that ‘‘registration will not be
withheld based solely on the failure by
an applicant to certify that it is willing
and able to comply with such [DOL and
OSHA] requirements * * *.’’ The
FMCSA has removed those certification
statements and the accompanying
instructions. We have added new
language that compliance with all
pertinent Federal, State, local and tribal
statutory and regulatory requirements,
including labor and environmental
laws, is mandatory. Such compliance
includes producing requested records
for review and inspection, and that
inspectors of the Immigration and
Naturalization Service at the port of
entry must determine the driver of the
vehicle meets the requirements under
the Immigration and Nationality Act.
The statements do not require
certification—they are informational in
nature—and thus have been placed after
the signature line.
The Filing Fee Policy and
Computation Box that formerly
appeared in the form instructions have
been moved to the back of the form
because a carrier cannot provide filing
fee information until completing
Section III—Types of Registration. The
fee policy also discloses that the
FMCSA will place a 30-day hold on the
application if the filing fee payment is
made by personal check.

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Finally, FMCSA will translate the
form and instructions into Spanish to
help applicants understand what each
question asks and what types of answers
they need to provide.
Rulemaking Analyses and Notices
Executive Order 12866 (Regulatory
Planning and Review) and Department
of Transportation Regulatory Policies
and Procedures
The FMCSA has determined that this
action is a significant regulatory action
within the meaning of Executive Order
12866, and is significant within the
meaning of Department of
Transportation regulatory policies and
procedures (44 FR 11034, February 26,
1979) because of public interest. It has
been reviewed by the Office of
Management and Budget under
Executive Order 12866. However, it is
anticipated that the economic impact of
the revisions in this rulemaking will be
minimal. The new or revised Form OP–
1(MX) is intended to foster and
contribute to safety of operations,
adherence to U.S. law and regulations,
and compliance with U.S. insurance
and tax payment requirements on the
part of Mexico-domiciled carriers.
Nevertheless, the subject of safe
operations by Mexico-domiciled carriers
in the United States has generated
considerable public interest within the
meaning of Executive Order 12866. The
manner in which the FMCSA carries out
its safety oversight responsibilities with
respect to this international motor
carrier transportation has been of
substantial interest to the domestic
motor carrier industry, the Congress,
and the public at large. The 2002 DOT
Appropriations Act includes specific
requirements FMCSA must complete to
begin reviewing and processing the
application Form OP–1(MX) under this
interim final rule.
The Regulatory Evaluation analyzes
the costs and benefits of this rule and
the two companion NAFTA-related
rules published elsewhere in today’s
Federal Register. Pursuant to Executive
Order 12866, because these rules are so
closely interrelated, we did not attempt
to prepare separate analyses for each
rule.
The evaluation estimated costs and
benefits based on three different
scenarios, with a high, low and medium
number of Mexico-domiciled carriers
assumed covered by the rules. The costs
of these rules are minimal under all
three scenarios. Over 10 years, the costs
range from $53 million for the low
scenario to approximately $76 million
for the high scenario. Forty percent of
these costs are borne by the FMCSA,

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while the remaining costs are paid by
Mexico-domiciled carriers. The largest
costs are those associated with
conducting pre-authorization safety
audits, compliance reviews within 18months of a carrier’s receiving
provisional operating authority, and the
loss of a carrier’s ability to operate in
the United States.
The FMCSA used the cost
effectiveness approach to determine the
benefits of these rules. This approach
involves estimating the number of
crashes that would have to be deterred
in order for the proposals to be cost
effective. Over 10 years, the low
scenario would have to deter 640
forecast crashes to be cost beneficial, the
medium scenario would have to deter
838, and the high scenario would have
to deter 929. While the overall number
of crashes to be avoided under the
medium and high scenario is fairly high,
the number falls rapidly over the 10year analysis period and beyond. The
tenth year deterrence rate is one-quarter
to one-sixth the size of the first year’s
rate.
A copy of the Regulatory Evaluation
is in the docket for this rulemaking.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
(Pub. L. 96–354, 5 U.S.C. 601–612), as
amended by the Small Business
Regulatory Enforcement and Fairness
Act (Pub. L. 104–121), requires Federal
agencies to analyze the impact of
rulemakings on small entities, unless
the Agency certifies that the rule will
not have a significant economic impact
on a substantial number of small
entities.
The United States did not have in
place a special system to ensure the
safety of Mexico-domiciled carriers
operating in the United States. Mexicodomiciled carriers will be subject to all
the same safety regulations as domestic
carriers. However, FMCSA’s
enforcement of the FMCSRs has become
increasingly data dependent in the last
several years. Several programs have
been put in place to continually analyze
crash rates, out-of-service rates,
compliance review records, and other
data sources to allow the agency to
focus on high-risk carriers. This strategy
is only effective if the FMCSA has
adequate data on carriers’ size,
operations, and history. Thus, a key
component of this rule and the
companion application rule for borderzone carriers is the requirement that
Mexico-domiciled carriers operating in
the United States must complete a Form
MCS–150-Motor Carrier Identification
Report, and must update their Form
OP–1(MX)-Application to Register

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12711

Mexican Carriers for Motor Carrier
Authority To Operate Beyond U.S.
Municipalities and Commercial Zones
on the U.S.-Mexico Border or Form OP–
2-Application for Mexican Certificate of
Registration for Foreign Motor Carriers
and Foreign Motor Private Carriers
Under 49 U.S.C. 13902 when their
situation changes. This will allow the
FMCSA to better monitor these carriers
and to quickly determine whether their
safety or out-of-service record changes.
The more stringent oversight
procedures established in our safety
monitoring interim final rule, RIN 2126–
AA35, will also allow the FMCSA to
respond more quickly when safety
problems emerge. Required safety
audits, compliance reviews and CVSA
inspections will provide the FMCSA
with more detailed information about
Mexico-domiciled carriers, and allow
the FMCSA to act appropriately upon
discovering safety problems.
The objective of these rules is to help
ensure the safe operation of Mexicodomiciled carriers in the United States.
The rules describe what additional
information Mexico-domiciled carriers
will have to submit, and outline the
procedure for dealing with possible
safety problems.
The safety monitoring system, the
safety certifications and other
information to be submitted in the OP–
1(MX) and OP–2 applications, and the
pre-authorization safety audit are means
of ensuring that: (1) Mexico-domiciled
applicants are sufficiently
knowledgeable about safety
requirements before commencing
operations (a prerequisite to being able
to comply); and (2) their actual
operations in the United States are
conducted in accordance with their
application certifications and the
conditions of their registrations.
These rules will primarily affect
Mexico-domiciled small motor carriers
who wish to operate in the United
States. The amount of information these
carriers will have to supply to the
FMCSA has been increased, and we
estimate that they will spend two
additional hours gathering data for the
OP–1(MX) and OP–2 application forms.
Mexico-domiciled carriers subject to
this rule will also have to undergo preauthorization safety audits and
demonstrate continuous compliance
with motor vehicle safety standards by
undergoing compliance reviews and
displaying valid CVSA inspection
decals on their vehicles. We presented
three growth scenarios in the regulatory
evaluation: A high option, with 11,787
Mexico-domiciled carriers in the
baseline; a medium scenario, with 9,500
Mexico-domiciled carriers in the

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baseline; and a low scenario, with 4,500
Mexico-domiciled carriers in the
baseline. Under all three options, the
FMCSA believes that the number of
applicants will match approximately
that observed in the last few years
before this publication date,
approximately 1,365 applicants per
year.
A review of the Motor Carrier
Management Information System census
file reveals that the vast majority of
Mexico-domiciled carriers are small,
with 75 percent having three or fewer
vehicles. Carriers at the 95th percentile
had only 15 trucks or buses.
These rules should not have any
impact on small U.S.-based motor
carriers.
The Regulatory Evaluation includes a
description of the recordkeeping and
reporting requirements of these rules.
Applicants filing both the OP–1(MX)
and OP–2 will also have to submit the
Form MCS–150 and the Form BOC–3–
Designation of Agent for Service of
Process. In addition, Mexico-domiciled
carriers will have to notify the FMCSA
of any changes to certain information.
The MCS–150 is approximately two
pages long. In addition to requiring
basic identifying information, it requires
that carriers state the type of operation
they run, the number of vehicles and
drivers they use, and the types of cargo
they haul. The BOC–3 form merely
requires the name, address and other
information for a domestic agent to
receive legal notices on behalf of the
motor carrier. The rules also include
other modest changes in the OP–1(MX)
and OP–2 forms.
None of these forms require any
special expertise to complete. Any
individual with knowledge about the
operations of a carrier should be able to
fill out these forms.
The FMCSA is not aware of any other
rules that duplicate, overlap with, or
conflict with these rules.
The FMCSA did not establish any
different requirements or timetables for
small entities. As noted above, we do
not believe these requirements are
onerous. Most covered carriers will be
required to spend two extra hours to
complete the relevant forms, undergo a
safety audit and a compliance review or
one safety audit (depending on the type
of authority they apply for) at four to six
hours each and display a valid CVSA
inspection decal. The part 385 rule
would not achieve its purposes if small
entities were exempt. In order to ensure
the safety of Mexico-domiciled carriers,
the rule must have a consistent
procedure for addressing safety
problems. Exempting small motor
carriers (which, as was noted above, are

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the vast majority or Mexico-domiciled
carriers who would operate in the
United States) would defeat the purpose
of these rules.
The FMCSA did not consolidate or
simplify the compliance and reporting
requirements for small carriers. Small
U.S.-based carriers already have to
comply with the paperwork
requirements in part 365. There is no
evidence that domestic carriers find
these provisions confusing or
particularly burdensome. Apropos the
part 385 provisions, we believe the
requirements are fairly straightforward,
and it would not be possible to simplify
them. A simplification of any substance
would make the rule ineffectual. Given
the compelling interest in guaranteeing
the safety of Mexico-domiciled carriers
operating in the United States, and the
fact that the majority of these carriers
are small entities, no special changes
were made.
Therefore, the FMCSA certifies that
this rule will not have a significant
economic impact on a substantial
number of small entities.
Executive Order 13211 (Energy Supply,
Distribution, or Use)
We have analyzed this action under
Executive Order 13211, Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use. This action is not
a significant energy action within the
meaning of section 4(b) of the Executive
Order because as a procedural action it
is not economically significant and will
not have a significant adverse effect on
the supply, distribution, or use of
energy.
Unfunded Mandates Reform Act of
1995
The Unfunded Mandates Reform Act
of 1995 (Pub. L. 104–4; 2 U.S.C. 1532)
requires each agency to assess the
effects of its regulatory actions on State,
local, and tribal governments and the
private sector. Any agency promulgating
a final rule likely to result in a Federal
mandate requiring expenditures by a
State, local, or tribal government or by
the private sector of $100 million or
more in any one year must prepare a
written statement incorporating various
assessments, estimates, and descriptions
that are delineated in the Act. The
FMCSA has determined that the
changes effected by this rulemaking
would not have an impact of $100
million or more in any one year. The
Federal Government reimburses
inspectors, funds facilities, and provides
support through the MCSAP grant
program.

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Executive Order 12988 (Civil Justice
Reform)
This action meets applicable
standards in sections 3(a) and 3(b)(2) of
Executive Order 12988, Civil Justice
Reform, to minimize litigation,
eliminate ambiguity and reduce burden.
Executive Order 13045 (Protection of
Children)
Executive Order 13045, ‘‘Protection of
Children from Environmental Health
Risks and Safety Risks’’ (April 23, 1997,
62 FR 19885), requires that agencies
issuing ‘‘economically significant’’ rules
that also concern an environmental
health or safety risk that an agency has
reason to believe may
disproportionately affect children must
include an evaluation of the
environmental health and safety effects
of the regulation on children. Section 5
of Executive Order 13045 directs an
agency to submit for a ‘‘covered
regulatory action’’ an evaluation of its
environmental health or safety effects
on children.
The agency has determined that this
rule is not a ‘‘covered regulatory action’’
as defined under Executive Order
13045. First, this rule is not
economically significant under
Executive Order 12866 because the
FMCSA has determined that the
changes in this rulemaking would not
have an impact of $100 million or more
in any one year. The costs range from
$53 to $76 million over 10 years.
Second, the agency has no reason to
believe that the rule would result in an
environmental health risk or safety risk
that would disproportionately affect
children. Mexico-domiciled motor
carriers who intend to operate
commercial motor vehicles anywhere in
the United States must comply with
current U.S. Environmental Protection
Agency regulations and other United
States environmental laws under this
rule and others being published
elsewhere in today’s Federal Register.
Further, the agency has conducted a
programmatic environmental
assessment as discussed later in this
preamble. While the PEA did not
specifically address environmental
impacts on children, it did address
whether the rule would have
environmental impacts in general.
Based on the PEA, the agency has
determined that the proposed rule
would have no significant
environmental impacts.
Executive Order 12630 (Taking of
Private Property)
This rule will not effect a taking of
private property or otherwise have

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taking implications under E. O. 12630,
Governmental Actions and Interference
with Constitutionally Protected Property
Rights.
Executive Order 13132 (Federalism
Assessment)
This action has been analyzed in
accordance with the principles and
criteria contained in Executive Order
13132, dated August 4, 1999 (64 FR
43255, August 10, 1999). The FMCSA
has determined that this action would
not have significant Federalism
implications or limit the policymaking
discretion of the States.
Executive Order 12372
(Intergovernmental Review)
Catalog of Federal Domestic
Assistance Program Number 20.217
Motor Carrier Safety. The regulations
implementing Executive Order 12372
regarding intergovernmental
consultation on Federal programs and
activities do not apply to this program.
Executive Order 13166 (Limited English
Proficiency)
Executive Order 13166, Improving
Access to Services for Persons With
Limited English Proficiency, requires
each Federal agency to examine the
services it provides and develop
reasonable measures to ensure that
persons seeking government services
but limited in their English proficiency
can meaningfully access these services
consistent with, and without unduly
burdening, the fundamental mission of
the agency. The FMCSA plans to
provide a Spanish translation of the
form OP–1(MX) application and
instructions. We believe that this action
complies with the principles enunciated
in the Executive Order.
Paperwork Reduction Act
Under the Paperwork Reduction Act
of 1995 (PRA) (44 U.S.C. 3501–3520),
Federal agencies must obtain approval
from the Office of Management and
Budget (OMB) for each collection of
information they conduct, sponsor, or
require through regulations. The
FMCSA has determined that this
proposal would impact a currently
approved information collection, OMB
No. 2126–0016.
The information collection
requirements of Form OP–1(MX) have
been approved by the OMB under the
control number 2126–0016, titled
‘‘Revision of Licensing Application
Forms, Application Procedures, and
Corresponding Regulations.’’ This
approval includes forms OP–1(MX),
OP–1(P), OP–1(FF), and OP–1 and totals
40,060 burden hours. Of that amount,
2,060 annual burden hours was

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estimated as the OP–1(MX) baseline
(1,030 respondents per year @ 2 hours
each to complete the form).
Carriers anticipating that the
moratorium on new grants of operating
authority to Mexico-domiciled carriers
would be lifted filed 190 applications,
but soon ceased to file applications
when it became evident that the forms
were not being processed due to a delay
in implementing the NAFTA agreement.
For this reason, OP–1(MX) filings fell
well below the 1,000 respondent
estimate.
Revisions to OP–1(MX) Baseline: A
PRA review normally involves
determining the information collection
impacts of a rulemaking, comparing
those impacts with the current
regulation (baseline) and measuring the
resulting change. The FMCSA finds it
necessary to amend the baseline (1) to
be consistent with updated
demographic data on Mexico-domiciled
carriers from the PEA and Regulatory
Flexibility Analysis to this rule, and (2)
to take into account an imminent
Presidential action that is not subject to
PRA review-the issuance of a
Presidential Order lifting the
moratorium on grants of operating
authority to Mexico-domiciled motor
carriers to operate within the United
States beyond the border zones. The
Regulatory Evaluation to this rule
projects a high, medium and low
estimate for the number of Mexicodomiciled carriers now operating within
the United States. The PRA review is
based on the medium estimate of 9,500
active carriers. Therefore, the revised
baseline assumes that the moratorium is
lifted and that Mexico-domiciled
carriers are filing the existing OP–1(MX)
application form. The agency is revising
the form title to ‘‘Application to Register
Mexican Carriers for Motor Carrier
Authority To Operate Beyond U.S.
Municipalities and Commercial Zones
on the U.S.-Mexico Border.’’
The FMCSA estimates that 5,108
Mexico-domiciled carriers will request
OP–1(MX) operating authority in year
one (includes half of the 9,500 active
Mexico-domiciled carriers (4,750) plus
25 percent of 1,430 new applicants
(358)), and 358 Mexico-domiciled
carriers will apply in subsequent years.
The existing form takes approximately 2
hours to complete. Since Mexicodomiciled carriers currently are not
required to update carrier identification
information, there would be zero
updates received in year one and
subsequent years. The revised baseline
is calculated as follows:
OP–1(MX) filings (year one): 10,216
hours [5,108 × 2 hours per form]

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12713

OP–1(MX) filings (subsequent years):
716 hours [358 × 2 hours per form]
The revised baseline results in the
following annual burden hour estimate
for control no. 2126–0016:
Year One: 48,216 hours [38,000 +
10,216]
Subsequent Years: 38,358 [38,000 + 358]
Impact of the interim final rule. This
action proposes to amend 49 CFR part
365 and revise Form OP–1(MX). Under
the amended regulations, Mexicodomiciled motor carriers seeking to
operate within the United States beyond
the border zones, including carriers that
previously filed pending Form OP–
1(MX) applications, would be required
to submit the revised Form OP–1(MX).
Under the revised Form OP–1(MX), the
FMCSA will collect more detailed
information on an applicant motor
carrier’s size, operations, and history
than can be collected using the current
form. In addition, all grants of operating
authority issued under the revised form
would be conditioned upon the carrier’s
successful completion of a preoperational safety audit and an 18month safety monitoring program
(established in an interim final rule
published elsewhere in today’s Federal
Register), including a compliance
review. For these reasons, the FMCSA
anticipates that the number of carriers
would be lower than the revised
baseline. The FMCSA estimates that
5,091 Mexico-domiciled carriers would
apply for OP–1(MX) authority in year
one, and 341 carriers thereafter. Due to
the additional information requested on
the form, the FMCSA estimates that it
will take 4 hours to complete.
The FMCSA must be notified in
writing of certain key changes in the
information on the form within 45 days
of the change. For changes and updates,
the agency anticipates that annually
approximately one quarter of those
granted authority will update their
applications. It will take approximately
30 minutes to complete the updates. For
simplicity’s sake, we based the number
of individuals granted authority on the
estimated total number of first-year
applicants.
OP–1(MX) Updates/Changes:
(In year one): 1,273 = (5,091 × .25 =
1272.75 rounded)
(In subsequent years): 1,358 (5,091 +
341 = 5,432 × .25)
Therefore, the FMCSA estimates that
the interim final rule will adjust the
annual burden hour estimate for the
OP–1(MX) as follows:
Mexico-domiciled carrier filings of the
Form OP–1(MX):
(In first year): 20,364 hours [5,091 × 4
hours per form]

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(In subsequent years): 1,364 hours [341
× 4 hours per form]
Updates/Changes:
(In first year): 1,273 × .50 hour per form
= 637 hours (rounded)
(In subsequent years): 1,358 × .50 hour
per form = 679 hours
The total burden hours for this
information collection in the first year is
59,001 hours [(38,000 hours + 20,364
hours + 637 hours)] and in subsequent
years is 40,043 hours [38,000 hours +
1,364 hours + 679 hours].
OMB Control Number: 2126–0016
Title: Revision of Licensing
Application Forms, Application
Procedures, and Corresponding
Regulations.
Respondents: Mexico-domiciled
motor carriers.
Estimated Annual Hour Burden for
this Interim Final Rule: Year 1 = 59,001
hours; Subsequent years = 40,043 hours.
You may submit any additional
comments on the information collection
burden addressed by this interim final
rule to the Office of Management and
Budget (OMB). The OMB must receive
your comments by April 18, 2002. You
must mail or hand deliver your
comments to: Attention: Desk Officer for
the Department of Transportation,
Docket Library, Office of Information
and Regulatory Affairs, Office of
Management and Budget, Room 10102,
725 17th Street, NW., Washington, DC
20503.
National Environmental Policy Act
The FMCSA is a new administration
within the Department of
Transportation (DOT). The FMCSA is
currently developing an agency order
that will comply with all statutory and
regulatory policies under the National
Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.). We expect the draft
FMCSA Order to appear in the Federal
Register for public comment in the near
future. The framework of the FMCSA
Order is consistent with and reflects the
procedures for considering
environmental impacts under DOT
Order 5610.1C. FMCSA has analyzed
this rule under the NEPA and DOT
Order 5610.1C, and has issued a Finding
Of No Significant Impact (FONSI). The
FONSI and the environmental
assessment are in the docket to this rule.
List of Subjects in 49 CFR Part 365
Administrative practice and
procedure, Brokers, Buses, Freight
forwarders, Motor carriers, Moving of
household goods, Reporting and
recordkeeping requirements.

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For the reasons set forth in the
preamble, the FMCSA amends 49 CFR
part 365 as follows:
PART 365—RULES GOVERNING
APPLICATIONS FOR OPERATING
AUTHORITY
1. The authority citation for part 365
is revised to read as follows:
Authority: 5 U.S.C. 553 and 559; 16 U.S.C.
1456; 49 U.S.C. 13101, 13301, 13901–13906,
14708, 31138, and 31144; 49 CFR 1.73.

2. In § 365.101, revise paragraph (h) to
read as follows:
§ 365.101
rules.

Applications governed by these

*

*
*
*
*
(h) Applications for Mexicodomiciled motor carriers to operate in
foreign commerce as common, contract
or private motor carriers of property
(including exempt items) between
Mexico and all points in the United
States. Under NAFTA Annex I, page I–
U–20, a Mexico-domiciled motor carrier
may not provide point-to-point
transportation services, including
express delivery services, within the
United States for goods other than
international cargo.
3. In § 365.105, revise paragraph (a) to
read as follows:
§ 365.105 Starting the application process:
Form OP–1.

(a) All applicants must file the
appropriate form in the OP–1 series,
effective January 1, 1995. Form OP–1 for
motor property carriers and brokers of
general freight and household goods;
Form OP–1(P) for motor passenger
carriers; Form OP–1(FF) for freight
forwarders of household goods; and
Form OP–1(MX) for Mexico-domiciled
motor property carriers, including
household goods and motor passenger
carriers. A separate filing fee in the
amount set forth at 49 CFR 360.3(f)(1) is
required for each type of authority
sought in each transportation mode.
*
*
*
*
*
4. Add a new subpart E to part 365 to
read as follows:
Subpart E—Special Rules for Certain
Mexico-Domiciled Carriers
Sec.
365.501 Scope of rules.
365.503 Application.
365.505 Re-registration and fee waiver for
certain applicants.
365.507 FMCSA action on the application.
365.509 Requirement to notify FMCSA of
change in applicant information.
365.511 Requirement for CVSA inspection
of vehicles during first three consecutive
years of permanent operating authority.
Appendix A to Subpart E of Part 365—
Explanation of Pre-Authorization Safety

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Audit Evaluation Criteria for MexicoDomiciled Motor Carriers

Subpart E—Special Rules for Certain
Mexico-domiciled Carriers
§ 365.501

Scope of rules.

(a) The rules in this subpart govern
the application by a Mexico-domiciled
motor carrier to provide transportation
of property or passengers in interstate
commerce between Mexico and points
in the United States beyond the
municipalities and commercial zones
along the United States-Mexico
international border.
(b) A Mexico-domiciled carrier may
not provide point-to-point
transportation services, including
express delivery services, within the
United States for goods other than
international cargo.
§ 365.503

Application.

(a) Each applicant applying under this
subpart must submit an application that
consists of:
(1) Form OP–1 (MX)—Application to
Register Mexican Carriers for Motor
Carrier Authority To Operate Beyond
U.S. Municipalities and Commercial
Zones on the U.S.-Mexico Border;
(2) Form MCS–150—Motor Carrier
Identification Report; and
(3) A notification of the means used
to designate process agents, either by
submission in the application package
of Form BOC–3—Designation of AgentsMotor Carriers, Brokers and Freight
Forwarders or a letter stating that the
applicant will use a process agent
service that will submit the Form BOC–
3 electronically.
(b) The Federal Motor Carrier Safety
Administration (FMCSA) will only
process your application if it meets the
following conditions:
(1) The application must be
completed in English;
(2) The information supplied must be
accurate, complete, and include all
required supporting documents and
applicable certifications in accordance
with the instructions to Form OP–1
(MX), Form MCS–150, and Form BOC–
3;
(3) The application must include the
filing fee payable to the FMCSA in the
amount set forth at 49 CFR 360.3(f)(1);
and
(4) The application must be signed by
the applicant.
(c) You must submit the application
to the address provided in Form OP–
1(MX).
(d) You may obtain the application
forms from any FMCSA Division Office
or download it from the FMCSA website
at: http://www.fmcsa.dot.gov/factsfigs/
formspubs.htm.

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§ 365.505 Re-registration and fee waiver
for certain applicants.

(a) If you filed an application using
Form OP–1(MX) before May 3, 2002,
you are required to file a new Form OP–
1(MX). You do not need to submit a new
fee when you file a new application
under this subpart.
(b) If you hold a Certificate of
Registration issued before April 18,
2002, authorizing operations beyond the
municipalities along the United StatesMexico border and beyond the
commercial zones of such
municipalities, you are required to file
an OP–1(MX) if you want to continue
those operations. You do not need to
submit a fee when you file an
application under this subpart.
(1) You must file the application by
November 4, 2003.
(2) The FMCSA may suspend or
revoke the Certificate of Registration of
any applicable holder that fails to
comply with the procedures set forth in
this section.
(3) Certificates of Registration issued
before April 18, 2002, will remain valid
unbvtil the FMCSA acts on the OP–
1(MX) application.
§ 365.507 FMCSA action on the
application.

(a) The FMCSA will review and act on
each application submitted under this
subpart in accordance with the
procedures set out in this part.
(b) The FMCSA will validate the
accuracy of information and
certifications provided in the
application by checking data
maintained in databases of the
governments of Mexico and the United
States.
(c) Pre-authorization safety audit.
Every Mexico-domiciled carrier that
applies under this part must
satisfactorily complete an FMCSAadministered safety audit before FMCSA
will grant provisional operating
authority to operate in the United
States. The safety audit is a review by
the FMCSA of the carrier’s written
procedures and records to validate the
accuracy of information and
certifications provided in the
application and determine whether the
carrier has established or exercises the
basic safety management controls
necessary to ensure safe operations. The
FMCSA will evaluate the results of the
safety audit using the criteria in
Appendix A to this subpart.
(d) If a carrier successfully completes
the pre-authorization safety audit and
the FMCSA approves its application
submitted under this subpart, FMCSA
will publish a summary of the
application as a preliminary grant of

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authority in the FMCSA Register to give
notice to the public in case anyone
wishes to oppose the application, as
required in § 365.109(b) of this part.
(e) If the FMCSA grants provisional
operating authority to the applicant, it
will assign a distinctive USDOT
Number that identifies the motor carrier
as authorized to operate beyond the
municipalities in the United States on
the U.S.-Mexico international border
and beyond the commercial zones of
such municipalities. In order to operate
in the United States, a Mexicodomiciled motor carrier with
provisional operating authority must:
(1) Have its surety or insurance
provider file proof of financial
responsibility in the form of certificates
of insurance, surety bonds, and
endorsements, as required by § 387.301
of this subchapter;
(2) File a hard copy of, or have its
process agent(s) electronically submit,
Form BOC–3—Designation of AgentsMotor Carriers, Brokers and Freight
Forwarders, as required by part 366 of
this subchapter; and
(3) Comply with all provisions of the
safety monitoring system in subpart B of
part 385 of this subchapter, including
successfully passing CVSA Level I
inspections at least every 90 days and
having decals affixed to each
commercial motor vehicle operated in
the United States as required by
§ 385.103(c) of this subchapter.
(f) The FMCSA may grant permanent
operating authority to a Mexicodomiciled carrier no earlier than 18
months after the date that provisional
operating authority is granted and only
after successful completion to the
satisfaction of the FMCSA of the safety
monitoring system for Mexicodomiciled carriers set out in subpart B
of part 385 of this subchapter.
Successful completion includes
obtaining a satisfactory safety rating as
the result of a compliance review.
§ 365.509 Requirement to notify FMCSA of
change in applicant information.

(a) A motor carrier subject to this
subpart must notify the FMCSA of any
changes or corrections to the
information in parts I, IA or II submitted
on the Form OP–1(MX) or the Form
BOC–3—Designation of Agents—Motor
Carriers, Brokers and Freight
Forwarders during the application
process or after having been granted
provisional operating authority. The
carrier must notify the FMCSA in
writing within 45 days of the change or
correction.
(b) If a carrier fails to comply with
paragraph (a) of this section, the FMCSA
may suspend or revoke its operating

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authority until it meets those
requirements.
§ 365.511 Requirement for CVSA
inspection of vehicles during first three
consecutive years of permanent operating
authority.

A Mexico-domiciled motor carrier
granted permanent operating authority
must have its vehicles inspected by
Commercial Vehicle Safety Alliance
(CVSA)-certified inspectors every three
months and display a current inspection
decal attesting to the successful
completion of such an inspection for at
least three consecutive years after
receiving permanent operating authority
from the FMCSA.
Appendix A to Subpart E of Part 365—
Explanation of Pre-Authorization Safety
Audit Evaluation Criteria for MexicoDomiciled Motor Carriers
I. General
(a) Section 350 of the Fiscal Year 2002
DOT Appropriations Act (Pub. L. 107–87)
directed the FMCSA to perform a safety audit
of each Mexico-domiciled motor carrier
before the FMCSA grants the carrier
provisional operating authority to operate
beyond United States municipalities and
commercial zones on the United StatesMexico international border.
(b) The FMCSA will decide whether it will
conduct the safety audit at the Mexicodomiciled motor carrier’s principal place of
business in Mexico or at a location specified
by the FMCSA in the United States, in
accordance with the statutory requirements
that 50 percent of all safety audits must be
conducted onsite and on-site inspections
cover at least 50 percent of estimated truck
traffic in any year. All records and
documents must be made available for
examination within 48 hours after a request
is made. Saturdays, Sundays, and Federal
holidays are excluded from the computation
of the 48-hour period.
(c) The safety audit will include:
(1) Verification of available performance
data and safety management programs;
(2) Verification of a controlled substances
and alcohol testing program consistent with
part 40 of this title;
(3) Verification of the carrier’s system of
compliance with hours-of-service rules in
part 395 of this subchapter, including
recordkeeping and retention;
(4) Verification of proof of financial
responsibility;
(5) Review of available data concerning the
carrier’s safety history, and other information
necessary to determine the carrier’s
preparedness to comply with the Federal
Motor Carrier Safety Regulations, parts 382
through 399 of this subchapter, and the
Federal Hazardous Material Regulations,
parts 171 through 180 of this title;
(6) Inspection of available commercial
motor vehicles to be used under provisional
operating authority, if any of these vehicles
have not received a decal required by
§ 385.103(d) of this subchapter;

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(7) Evaluation of the carrier’s safety
inspection, maintenance, and repair facilities
or management systems, including
verification of records of periodic vehicle
inspections;
(8) Verification of drivers’ qualifications,
including confirmation of the validity of the
Licencia de Federal de Conductor of each
driver the carrier intends to assign to operate
under its provisional operating authority; and
(9) An interview of carrier officials to
review safety management controls and
evaluate any written safety oversight policies
and practices.
(d) To successfully complete the safety
audit, a Mexico-domiciled motor carrier must
demonstrate to the FMCSA that it has the
required elements in paragraphs (c)(2), (3),
(4), (7), and (8) above and other basic safety
management controls in place which
function adequately to ensure minimum
acceptable compliance with the applicable
safety requirements. The FMCSA developed
a ‘‘safety audit evaluation criteria,’’ which
uses data from the safety audit and roadside
inspections to determine that each applicant
for provisional operating authority has basic
safety management controls in place.
(e) The safety audit evaluation process
developed by the FMCSA is used to:
(1) Evaluate basic safety management
controls and determine if each Mexicodomiciled carrier and each driver is able to
operate safely in the United States beyond
municipalities and commercial zones on the
United States-Mexico international border;
and
(2) Identify motor carriers and drivers who
are having safety problems and need
improvement in their compliance with the
FMCSRs and the HMRs, before FMCSA
grants the carriers provisional operating
authority to operate beyond United States
municipalities and commercial zones on the
United States-Mexico international border.
II. Source of the Data for the Safety Audit
Evaluation Criteria
(a) The FMCSA’s evaluation criteria are
built upon the operational tool known as the
safety audit. The FMCSA developed this tool
to assist auditors and investigators in
assessing the adequacy of a Mexicodomiciled carrier’s basic safety management
controls.
(b) The safety audit is a review of a
Mexico-domiciled motor carrier’s operation
and is used to:
(1) Determine if a carrier has the basic
safety management controls required by 49
U.S.C. 31144;
(2) Meet the requirements of Section 350 of
the DOT Appropriations Act; and
(3) In the event that a carrier is found not
to be in compliance with applicable FMCSRs
and HMRs, the safety audit can be used to
educate the carrier on how to comply with
U.S. safety rules.
(c) Documents such as those contained in
driver qualification files, records of duty
status, vehicle maintenance records, and
other records are reviewed for compliance
with the FMCSRs and HMRs. Violations are
cited on the safety audit. Performance-based
information, when available, is utilized to
evaluate the carrier’s compliance with the

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vehicle regulations. Recordable accident
information is also collected.
III. Overall Determination of the Carrier’s
Basic Safety Management Controls
(a) The carrier will not be granted
provisional operating authority if the FMCSA
fails to:
(1) Verify a controlled substances and
alcohol testing program consistent with part
40 of this title;
(2) Verify a system of compliance with
hours-of-service rules of this subchapter,
including recordkeeping and retention;
(3) Verify proof of financial responsibility;
(4) Verify records of periodic vehicle
inspections; and
(5) Verify drivers’ qualifications of each
driver the carrier intends to assign to operate
under such authority, as required by parts
383 and 391 of this subchapter, including
confirming the validity of each driver’s
Licencia de Federal de Conductor.
(b) If the FMCSA confirms each item under
II (a)(1) through (5) above, the carrier will be
granted provisional operating authority,
except if FMCSA finds the carrier has
inadequate basic safety management controls
in at least three separate factors described in
part III below. If FMCSA makes such a
determination, the carrier’s application for
provisional operating authority will be
denied.
IV. Evaluation of Regulatory Compliance
(a) During the safety audit, the FMCSA
gathers information by reviewing a motor
carrier’s compliance with ‘‘acute’’ and
‘‘critical’’ regulations of the FMCSRs and
HMRs.
(b) Acute regulations are those where
noncompliance is so severe as to require
immediate corrective actions by a motor
carrier regardless of the overall basic safety
management controls of the motor carrier.
(c) Critical regulations are those where
noncompliance relates to management and/or
operational controls. These are indicative of
breakdowns in a carrier’s management
controls.
(d) The list of the acute and critical
regulations, which are used in determining if
a carrier has basic safety management
controls in place, is included in Appendix B,
VII. List of Acute and Critical Regulations to
part 385 of this subchapter.
(e) Noncompliance with acute and critical
regulations are indicators of inadequate
safety management controls and usually
higher than average accident rates.
(f) Parts of the FMCSRs and the HMRs
having similar characteristics are combined
together into six regulatory areas called
‘‘factors.’’ The regulatory factors, evaluated
on the adequacy of the carrier’s safety
management controls, are:
(1) Factor 1—General: Parts 387 and 390;
(2) Factor 2—Driver: Parts 382, 383 and
391;
(3) Factor 3—Operational: Parts 392 and
395;
(4) Factor 4—Vehicle: Part 393, 396 and
inspection data for the last 12 months;
(5) Factor 5—Hazardous Materials: Parts
171, 177, 180 and 397; and
(6) Factor 6—Accident: Recordable
Accident Rate per Million Miles.

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(g) For each instance of noncompliance
with an acute regulation, 1.5 points will be
assessed.
(h) For each instance of noncompliance
with a critical regulation, 1 point will be
assessed.
(i) Vehicle Factor. (1) When at least three
vehicle inspections are recorded in the Motor
Carrier Management Information System
(MCMIS) during the twelve months before
the safety audit or performed at the time of
the review, the Vehicle Factor (part 396) will
be evaluated on the basis of the Out-ofService (OOS) rates and noncompliance with
acute and critical regulations. The results of
the review of the OOS rate will affect the
Vehicle Factor as follows:
(i) If the motor carrier has had at least three
roadside inspections in the twelve months
before the safety audit, and the vehicle OOS
rate is 34 percent or higher, one point will
be assessed against the carrier. That point
will be added to any other points assessed for
discovered noncompliance with acute and
critical regulations of part 396 to determine
the carrier’s level of safety management
control for that factor.
(ii) If the motor carrier’s vehicle OOS rate
is less than 34 percent, or if there are less
than three inspections, the determination of
the carrier’s level of safety management
controls will only be based on discovered
noncompliance with the acute and critical
regulations of part 396.
(2) Over two million inspections occur on
the roadside each year in the United States.
This vehicle inspection information is
retained in the MCMIS and is integral to
evaluating motor carriers’ ability to
successfully maintain their vehicles, thus
preventing them from being placed OOS
during roadside inspections. Each safety
audit will continue to have the requirements
of part 396, Inspection, Repair, and
Maintenance, reviewed as indicated by the
above explanation.
(j) Accident Factor. (1) In addition to the
five regulatory factors, a sixth factor is
included in the process to address the
accident history of the motor carrier. This
factor is the recordable accident rate, which
the carrier has experienced during the past
12 months. Recordable accident, as defined
in 49 CFR 390.5, means an accident
involving a commercial motor vehicle
operating on a public road in interstate or
intrastate commerce which results in a
fatality; a bodily injury to a person who, as
a result of the injury, immediately receives
medical treatment away from the scene of the
accident; or one or more motor vehicles
incurring disabling damage as a result of the
accident requiring the motor vehicle to be
transported away from the scene by a tow
truck or other motor vehicle.
(2) Experience has shown that urban
carriers, those motor carriers operating
entirely within a radius of less than 100 air
miles (normally urban areas), have a higher
exposure to accident situations because of
their environment and normally have higher
accident rates.
(3) The recordable accident rate will be
used in determining the carrier’s basic safety
management controls in Factor 6, Accident.
It will be used only when a carrier incurs two

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or more recordable accidents within the 12
months before the safety audit. An urban
carrier (a carrier operating entirely within a
radius of 100 air miles) with a recordable rate
per million miles greater than 1.7 will be
deemed to have inadequate basic safety
management controls for the accident factor.
All other carriers with a recordable accident
rate per million miles greater than 1.5 will be
deemed to have inadequate basic safety
management controls for the accident factor.
The rates are the result of roughly doubling
the United States national average accident
rate in Fiscal Years 1994, 1995, and 1996.
(4) The FMCSA will continue to consider
preventability when a new entrant contests
the evaluation of the accident factor by
presenting compelling evidence that the
recordable rate is not a fair means of
evaluating its accident factor. Preventability
will be determined according to the
following standard: ‘‘If a driver, who
exercises normal judgment and foresight,
could have foreseen the possibility of the
accident that in fact occurred, and avoided it
by taking steps within his/her control which
would not have risked causing another kind
of mishap, the accident was preventable.’’
(k) Factor Ratings
(1) The following table shows the five
regulatory factors, parts of the FMCSRs and
HMRs associated with each factor, and the

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accident factor. Each carrier’s level of basic
safety management controls with each factor
is determined as follows:
(i) Factor 1—General: Parts 390 and 387;
(ii) Factor 2—Driver: Parts 382, 383, and
391;
(iii) Factor 3—Operational: Parts 392 and
395;
(iv) Factor 4—Vehicle: Parts 393, 396 and
the Out of Service Rate;
(v) Factor 5—Hazardous Materials: Part
171, 177, 180 and 397; and
(vi) Factor 6—Accident: Recordable
Accident Rate per Million Miles;
(2) For paragraphs III (k)(1)(i) through (v)
(Factors 1 through 5), if the combined
violations of acute and or critical regulations
for each factor is equal to three or more
points, the carrier is determined not to have
basic safety management controls for that
individual factor.
(3) For paragraphs III (k)(1)(vi), if the
recordable accident rate is greater than 1.7
recordable accidents per million miles for an
urban carrier (1.5 for all other carriers), the
carrier is determined to have inadequate
basic safety management controls.
(l) Notwithstanding FMCSA verification of
the items listed in part II (a)(1) through (5)
above, if the safety audit determines the
carrier has inadequate basic safety
management controls in at least three

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separate factors described in part III, the
carrier’s application for provisional operating
authority will be denied. For example,
FMCSA evaluates a carrier finding:
(1) One instance of noncompliance with a
critical regulation in part 387 scoring one
point for Factor 1;
(2) Two instances of noncompliance with
acute regulations in part 382 scoring three
points for Factor 2;
(3) Three instances of noncompliance with
critical regulations in part 396 scoring three
points for Factor 4; and
(4) Three instances of noncompliance with
acute regulations in parts 171 and 397
scoring four and one-half (4.5) points for
Factor 5.
Under this example, the carrier will not
receive provisional operating authority
because it scored three or more points for
Factors 2, 4, and 5 and FMCSA determined
the carrier had inadequate basic safety
management controls in at least three
separate factors.
Issued on: March 7, 2002.
Joseph M. Clapp,
Administrator.
Note: The following form will not appear
in the Code of Federal Regulations.
BILLING CODE 4910–EX–P

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[FR Doc. 02–5891 Filed 3–14–02; 8:45 am]
BILLING CODE 4910–EX–C

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