Interpretation ID: aiam2844
Esq. Singer
Hutner
Levine and Seeman 110 East 59th Street New York
NY 10022;
Dear Mr. Chase: This is in response to your April 6, 1978, lette regarding the eligibility of Officino Alfieri Maserati, S.p.A. (Maserati) to apply for an exemption from the generally applicable average fuel economy standards under the Motor Vehicle Information and Cost Savings Act, as amended. You concluded that Maserati was eligible for this exemption although it is under common control with another company, Nuova Innocenti S.p.A. (Innocenti), whose annual production of passenger automobiles exceeds 10,000 passenger automobilies. I agree with your conclusion for the reason set forth below. The requirements concerning eligibility for an exemption under the Act are set forth in section 502(c), which provides: On application of a manufacturer who manufactured (whether or not in the United States) fewer than 10,000 passenger automobiles in the second model year preceding the model year for which the application is made, the Secretary may, by rule, exempt such manufacturer from subsection (a). To determine whether Maserati manufactures fewer than 10,000 passenger automobiles, it is necessary to interpret and apply sections 501(9) and 503(c) of the Act. Section 501(9) provides: 'The term 'manufacturer' (sic) (except for purposes of section 502 (c) means to produce or assemble in the customs territory of the United States, or to import.' Section 503(c) provides: (c) Any reference in this part to automobiles manufactured by a manufacturer shall be deemed- - (1) to include all automobiles manufactured by persons who control, are controlled by, or are under common control with, such manufacturer, and (2) to exclude all automobiles manufactured (within the meaning of paragraph (1)) during a model year by such manufacturer which are exported prior to the expiration of 30 days following the end of such model year. If sections 501(9) and 502(c) were considered together and section 503(c) were excluded from consideration, it is clear that Maserati would be eligible for an exemption, since Maserati's annual worldwide production is well under 10,000 automobiles. The key question, as you observed, involves section 503(c)- The question is whether 'manufacture' in section 503(c), as that section applies to section 502(c), means 'to produce or assemble in the customs territory of the United States, or to import' or means 'to produce or assemble, regardless of the geographical location of the act.' The former, restricted definition is given in section 501(9) and applies, except for the purposes of section 502(c), to all Title V. The latter, unrestricted definition is derived from the phrase 'manufactured (whether or not in the United States)' in the first sentence of section 502(c) and applies for the purpose of that section. I believe that 'manufacture', as used in section 503(c), has the restricted meaning. As I interpret the phrase 'for the purposes of section 502(c),' 'manufacture' has the unrestricted meaning only in section 502(c) and even there not in every instance. Thus, the Innocenti automobiles are not counted together with the Maseratis for the purposes of determining eligibility for an exemption under section 502(c). The Innocenti automobiles would be added to Maseratis only if the Innocentis were 'manufactured' in the restricted sense, that is, if the Innocentis were imported into the United States. Since the Innocenti automobiles are not counted with Maserati's, Maserati is eligible for an exemption from the generally applicable average fuel economy standard. This agency will begin processing your petition immediately. If you have any further questions on this matter, please contact Stephen Kratzke of the Office of Chief Counsel at (202) 426-2922. Sincerely, Howard Dugoff Deputy Administrator;