Tuesday July 26, 1994 Part V OFFICE OF MANAGEMENT AND BUDGET Economic Classification Policy Committee Standard Industrial Classification Replacement AGENCY: Office of Management and Budget, Executive Office of the President ACTION: Notice of Proposal to Replace the Standard Industrial Classification (SIC) with a New North American Industry Classification System (NAICS). SUMMARY: Under Title 44 U.S.C. 3504, the Office of Management and Budget (OMB) is seeking public comment on a proposal to develop a new industry classification system. The proposed system, to be developed in cooperation with Mexico's Instituto Nacional de Estadistica, Geografia e Informatica (INEGI) and Statistics Canada, would be known as the North American Industry Classification System (NAICS). NAICS would replace the current system known as the Standard Industrial Classification (SIC). The proposed NAICS would provide common industry definitions for Canada, Mexico, and the United States to facilitate economic analyses that cover the economies of the three North American countries. The concepts for the new system, as developed by Statistics Canada, Mexico's INEGI, and OMB's Economic Classification Policy Committee (ECPC), are contained in a joint, three-country statement, published as Part II of this notice. This notice: (1) Summarizes in Part I the background for the review of the U.S. industry classification system; (2) contains in Part II the proposed conceptual framework for the proposed NAICS, which would be a production-oriented economic classification; (3) details in Part III the process by which the ECPC would develop its recommended actions for the new industry classification system; and (4) outlines in Part IV a work plan that would initiate implementation of NAICS in 1997. While the ECPC is proposing a production-oriented concept for the NAICS, it is also committed to providing improved data for purposes that require market-oriented groupings including an expansion of the lists of commodities and services that will be available from the 1997 Economic Censuses. This market-oriented grouping system would be implemented after 1997. The ECPC is seeking comments on: (1) the usefulness and advisability of a common North American system for industry classifications, (2) the proposed conceptual framework for the new NAICS, and (3) the proposed next steps in the development of the classification system for detailed industries. The ECPC is also seeking proposals for: (1) new industries and for changing the boundaries of existing industries, and (2) market-oriented, or demand-based, groupings of economic data. The new NAICS remains tentatively scheduled for introduction in 1997. DATES: To ensure consideration, all comments on the usefulness and advisability of a common North American system for industry classifications, the conceptual framework, and the replacement process must be in writing and should be received by October 3, 1994. All proposals for new industries and for changing the boundaries of existing industries as well as for market-oriented, or demand-based, groupings of economic data must be in writing and should be submitted as soon as possible, but should be received no later than November 7, 1994. ADDRESSES: Copies of all ECPC papers and documents mentioned in this notice are available by contacting Peggy L. Burcham, Economic Classification Policy Committee, Bureau of Economic Analysis (BE-42), U.S. Department of Commerce, Washington, D.C. 20230, telephone number (202) 606-9615, FAX (202) 606-5311. Please send written comments on the usefulness and advisability of a common North American system for industry classifications, the conceptual framework, or the replacement process to: Jack E. Triplett, Chairman, Economic Classification Policy Committee, Bureau of Economic Analysis (BE-42), U.S. Department of Commerce, Washington, D.C. 20230. Please send written proposals for new industries and for changing the boundaries of existing industries as well as for market-oriented, or demand-based, groupings of economic data to: Carole Ambler, Coordinator, Economic Classification Policy Committee, Bureau of the Census, U.S. Department of Commerce, Room 3685-3, Washington, D.C. 20233, telephone number (301) 763- 5268, FAX (301) 763-2324. ELECTRONIC AVAILABILITY AND COMMENTS: This document is available on the Internet from the Census Bureau via GOPHER or HTTL under the listing "Federal Register Notice Soliciting Proposals on Restructuring the SIC." This document, as well as the March 31, 1993, Federal Register notice and the complete set of related ECPC issues papers and reports, is also available via File Transfer Protocol (FTP) from ftp.census.gov in the /pub/naics directory. Comments and proposals may be sent via electronic mail to the Census Bureau at naics@census.gov (do not use any capital letters in the address). Comments and proposals received at this address by the dates specified above will be included as part of the official record. For assistance in reaching the Census Bureau via electronic mail, FTP, GOPHER, or HTTL (e.g., MOSAIC, CELLO, LYNX), please contact your system administrator. You may also send an electronic message to gatekeeper@census.gov requesting the "FAQ" (Frequently Asked Questions). You will receive an electronic reply with information on how to access these services. FOR FURTHER INFORMATION CONTACT: On the usefulness and advisability of a common North American system for industry classifications, the conceptual framework, or the replacement process: Jack E. Triplett, Chairman, Economic Classification Policy Committee, Bureau of Economic Analysis (BE-42), U.S. Department of Commerce, Washington, D.C. 20230, telephone number (202) 606-9603, FAX (202) 606-5311. On all proposals for new industries and for changing the boundaries of existing industries as well as for market-oriented, or demand-based, groupings of economic data: Carole Ambler, Coordinator, Economic Classification Policy Committee, Bureau of the Census, U.S. Department of Commerce, Room 3685-3, Washington, D.C. 20233, telephone number (301) 763-5268, FAX (301) 763-2324. SUPPLEMENTARY INFORMATION: PART I: Background The Standard Industrial Classification (SIC) is the principal system used to promote comparability of statistical data describing establishments in the U.S. economy. This coding scheme is employed by Federal agencies to collect, tabulate, and publish establishment data by industry. The last major revision of the SIC was in 1987. However, the basic structure of the SIC has remained substantially the same since its introduction more than 50 years ago. In a previous notice in the Federal Register (FR, March 31, 1993, pp. 16990-17004), the Office of Management and Budget announced the formation of the Economic Classification Policy Committee, chaired by the Bureau of Economic Analysis, U.S. Department of Commerce, with representatives from the Bureau of the Census, U.S. Department of Commerce, and the Bureau of Labor Statistics, U.S. Department of Labor. The ECPC reports to OMB which has responsibility for all economic classification systems, other than those for international trade. The ECPC is charged with a "fresh slate" examination of economic classifications for statistical purposes, including industrial classifications, product classifications, and product code groupings. The ECPC's charge includes: (1) identifying the essential statistical uses of economic classifications; (2) identifying and developing, if needed, economic concepts, new structures, and statistical methodologies that address such statistical uses; (3) developing classification system(s) based on those concepts; (4) planning the implementation of the new classification system(s); and (5) ensuring that there is ample opportunity for widespread public participation in the process. The ECPC has prepared and circulated six issues papers on various aspects of economic classifications. ECPC Issues Paper No. 1, "Conceptual Issues," and ECPC Issues Paper No. 2, "Aggregation Structures and Hierarchies," were published in the Federal Register with the original notice on March 31, 1993. Those two issues papers discuss economic concepts for industry classification systems. ECPC Issues Paper No. 1 makes the important distinction between classification systems that correspond to a production-oriented (or supply-based) economic concept, and those that correspond to a market-oriented (or demand-based) economic concept. The paper also notes that two major purposes for grouped or aggregated data can be identified and that they correspond, in turn, to the two concepts-- production-oriented and market-oriented--discussed in the paper. Production studies, for example, including the measurement of productivity, and comparisons of capital intensity and input usage across industries, require that establishments that have similar production processes be grouped together, and that different industries demarcate differences in production processes. Marketing studies, on the other hand, require groupings that correspond to markets, and that group products or commodities according to their use. The paper suggests that industry classifications of the future should conform to a consistent economic concept, and that the concept that is appropriate depends on the statistical purposes for which the data are collected. The comments that the ECPC received on ECPC Issues Papers Nos. 1 and 2 display a wide range of views. Public responses indicated substantial support for examining economic concepts for classifications, though also some reservations. Of the respondents who favor a conceptual framework for economic classifications, some favor a production-oriented system and others a market-oriented system. Respondents expressed substantial concerns about costs and feasibility, as well as about potential disruptions that any new system would produce in time series. Though views on international compatibility were not sought in the Federal Register notice, respondents often volunteered that international comparability, particularly among North American countries, is important in their uses of economic statistics. (A report, "Summary of Public Comments to ECPC Issues Papers Nos. 1 and 2" [1], is available from the ECPC.) Four additional ECPC issues papers have been distributed since the original Federal Register notice: Issues Paper No. 3--Collectibility of Data Issues Paper No. 4--Criteria for Determining Industries Issues Paper No. 5--The Impact of Classification Revisions on Time Series Issues Paper No. 6--Services Classifications ECPC Issues Paper No. 3 explains how establishment coding for industry classifications is done in the United States, and how the information available to statistical agencies for coding places limits on the industry definitions that can in practice be adopted. ECPC Issues Paper No. 4 describes the statistical measures that have been used in the past to determine industries (primarily size measures and specialization and coverage ratios) and discusses some problems with these measures. It also describes the new heterogeneity index that the ECPC has developed as a new statistical methodology that can be used, in conjunction with traditional information, to judge the conceptual appropriateness of industry definitions, according to the production-oriented economic concept. ECPC Issues Paper No. 5 describes the fundamental trade-offs that must be made between retaining time-series comparability and making changes in the classification system to improve it and to keep it up to date. ECPC Issues Paper No. 6 contains a section describing how the economic concepts of ECPC Issues Paper No. 1 can be applied to service industries, and also discusses some of the unique problems that arise in classifying service industries. ECPC Research Activity The ECPC and Statistics Canada have reviewed the existing structure of detailed "4-digit" industries in the United States and Canada for conformance to economic concepts. The results of the U.S. review are contained in ECPC Report No.1, "Economic Concepts Incorporated in the Standard Industrial Classification Industries of the United States," and the Canadian results are contained in "The Conceptual Basis of the Standard Industrial Classification," Standards Division, Statistics Canada. In addition, the ECPC has carried out an independent evaluation of U.S. industries using the new "index of heterogeneity" to assess whether establishments in existing 4-digit industries meet the conditions for the production-oriented classification concept, as presented in ECPC Issues Paper No. 1. All of these research reports are available from the ECPC on request. International Comparability In the past, the U.S. SIC system was not necessarily compatible with the industry classification systems used in other countries. This incompatibility created problems for analyses that sought to compare industrial characteristics, trends, and developments across the economies of different countries, but such data uses were never given high priority in the design of the SIC system. A central aspect of the ECPC's new approach to industry classifications is active consultation with international statistical agencies, including the Statistical Office of the European Communities and the United Nations Statistical Office, and particularly with statistical agencies of the North American Free Trade Agreement signatories, Mexico's INEGI and Statistics Canada. Statistical agencies from the three North American countries have agreed to develop a North American Industry Classification System that would produce common industrial statistics for all three countries. A joint statement on NAICS concepts, prepared and released by these statistical agencies, follows (Part II). The conceptual framework and process proposed for the United States in Part III of this notice are consistent with this joint statement. PART II. THE CONCEPTUAL FRAMEWORK FOR THE NEW NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM Statistics Canada, Mexico's Instituto Nacional de Estadistica, Geografia e Informatica (INEGI), and the Economic Classification Policy Committee (ECPC) of the United States, acting on behalf of the Office of Management and Budget (OMB), have agreed that a common industry classification system for the three North American countries is needed and should be put in place. They have further agreed that the new North American Industry Classification System (NAICS) should conform to the following principles. 1. The uses of industrial statistics which include measuring productivity, unit labor costs, and the capital intensity of production require that information on outputs and inputs be used together. Moreover, statistical agencies in the three countries expect to be called upon to produce information on inputs and outputs, industrial performance, productivity, unit labor costs, employment, and other statistics in order to analyze the effects of the North American Free Trade Agreement. An industry classification system erected on a production-oriented, or supply-based, conceptual framework will assure maximum usefulness of industrial statistics for these and similar purposes. Therefore, the three countries agree that the new North American Industry Classification System should conform to a production-oriented economic concept. 2. The statistical agencies of the three countries also agree that market-oriented, or demand-based, groupings of economic data are required for many purposes, including studies of market share, demands for goods and services, import competition in domestic markets, and similar studies. Each country will provide product data compiled within the framework of its respective statistical system, to meet the need for such information. Recognizing the increasing international trade in goods and services, each country will work cooperatively to help improve commodity classification systems, including the Harmonized System (HS) of the Customs Cooperation Council and the United Nations provisional Central Product Classification (CPC) system for services, by coordinating efforts and keeping each agency informed of proposals for changes. 3. The statistical agencies of the three countries envision the implementation of a production-oriented conceptual framework for economic classifications in the new North American Industry Classification System as a long-term goal. The conceptual framework will be used, both for 1997 and subsequently, in reviewing changes to the existing list of industries. 4. Statistical agencies of the three countries agree to give special attention to developing production-oriented classifications for (a) new and emerging industries, (b) service industries in general, and (c) industries engaged in the production of advanced technologies, including, but not necessarily limited to, electronic components, telecommunications equipment, computer equipment, computer software, medical equipment, and advanced materials. For these industries, statistical agencies will actively seek out industry expertise in all three countries, in order to generate the information required to define industries in accordance with the agreed production-oriented economic concept. 5. For industries in sectors of the economy outside of those sectors discussed in paragraph (4), statistical agencies of the three countries wish to maintain time series continuity, to the extent possible. However, changes in the economy and evolving user needs must be taken into account. Accordingly, proposals relating to all parts of the classification will be considered, so long as they are supported by reasoning and factual information that furthers the long-term goal of the North American Industry Classification System. 6. Those sectors of the economy where Canada, Mexico, and the United States presently have incompatible industry definitions will require adjustments in order to produce a common North American Industry Classification System. The three countries' statistical agencies agree to a detailed review of their present industry definitions to determine where differences in industry definitions exist and to move toward full commonality and the implementation of production-oriented reasoning into the new classification system. 7. In the interest of a wider range of international comparisons, the three countries agree to strive for a North American Industry Classification System that will be compatible with the 2-digit level of the current International Standard Industrial Classification of All Economic Activities (ISIC, Revision 3) of the United Nations. PART III. U.S. PROCEDURES AND SOLICITATION OF PROPOSALS FOR 4-DIGIT INDUSTRIES As indicated in Part II, the ECPC, acting on behalf of OMB, has agreed jointly with Mexico's INEGI and Statistics Canada to propose a new North American Industry Classification System that would be common to the three countries. The three countries have also proposed (paragraph 1 of Part II) that NAICS be based on a production-oriented, supply-based economic concept for industry classification. In addition, the United States is proposing to prepare a separate, market-oriented product grouping system that would produce data for market-oriented analyses. The present announcement solicits proposals from the public for both the NAICS industry system and the separate market-oriented product grouping system. Common Industry Classification System for North America 1. Under NAICS, the industry classification systems of Canada, Mexico, and the United States would move toward full commonality. Many respondents to the ECPC's March 31, 1993, Federal Register notice, supported far greater international comparability of industrial statistics, especially within North America (see "Summary of Public Comments to ECPC Issues Papers Nos. 1 and No. 2," pp. 12-13) [1]. The three countries' statistical agencies intend to produce comparable industry data at the most detailed practical level, limited only by differences among the economies of the three countries. Production-Oriented Concept 2. The three countries' statistical agencies have agreed that industries in NAICS would be based on a production-oriented conceptual framework. As described in ECPC Issues Paper No. 1, "Conceptual Issues," part 1.2, when an industry is defined on a production-oriented concept, the producing units are grouped according to similarities in their production processes. Producing units within the industry's boundaries share a basic production process; they use closely similar technology. Producing units in no other industry share precisely the same combination of technologies or production processes. In the language of economics, producing units within an industry share the same production functions; producing units in different industries have different production functions. The boundaries between industries thus demarcate, in principle, differences in production processes and production technologies. (For additional information on the production-oriented concept, see ECPC Report No. 1, "Economic Concepts Incorporated in the Standard Industrial Classification Industries of the United States," and ECPC Report No. 2, "The Heterogeneity Index: A Quantitative Tool to Support Industrial Classification." For the application of the production-oriented concept to service industries, see ECPC Issues Paper No. 6, "Services Classifications.") The reasoning behind the three statistical agencies' decision may be summarized as follows. An industry is a grouping of economic activities. Though it inevitably groups the products of the economic activities that are included in the industry definition, it is not solely a grouping of products. Put another way, an industry groups producing units. Accordingly, an industry classification system provides a framework for collecting data on inputs and outputs together. The uses of economic data that require that data on inputs and outputs be used together, and be collected on the same basis, include production analyses, productivity measurement, and studying input usage and input intensities. The North American statistical agencies are proposing the production-oriented concept as the framework for industry statistics because (1) an industry classification system groups producing units, not products or services; and (2) groupings of producing units permit the collection of data on inputs and outputs on a comparable basis which is required for production-oriented analysis, but do not facilitate a comprehensive collection of data on the total output of any particular product or service, which is required for market- oriented analysis. Thus, the efficient organizing concept of an industry classification system is production-oriented rather than market-oriented. Market-Oriented Groupings 3. Part II of this notice also specifies (paragraph 2) that market-oriented, or demand-based, groupings of economic data are required for many purposes; some of these purposes may not be well served by a production-oriented industry classification system. The distinction between market-oriented and production-oriented economic groupings is developed in ECPC Issues Paper No. 1; additional information is contained in ECPC Reports Nos. 1 and 2 and ECPC Issues Paper No. 6. The ECPC is committed to a program that will provide improved data for purposes that require market-oriented groupings. This program consists of two parts. (a) The ECPC has committed to expanding the lists of commodities and services that will be available from the 1997 Economic Censuses. The ECPC has formed several "Product Codes Task Forces." These task forces have been charged with improving the basic lists of products and commodities, and for constructing new detailed codes that will be compatible across U.S. statistical agencies, and will also mesh to the extent possible with international detailed commodity or product systems. The ECPC is also committed to developing new mechanisms that will identify more quickly new products and services as they enter into commerce, and will work with other government agencies that have expertise on these matters and that have similar concerns. (b) Improved product code data will, in turn, provide the basic commodity information for statistical agencies or users to develop market-oriented, demand-based economic groupings. The expanded product codes will permit aggregations for products that are close substitutes or complements but which may cut across the production processes of individual industries (see ECPC Issues Papers Nos. 1 and 6, and ECPC Report No. 1). Emphasis on New Industries, Service Industries, and Advanced Technology 4. The ECPC will emphasize the development of improved industry classifications for (1) new and emerging industries, (2) service industries, in general, and (3) industries engaged in the production of advanced technologies. For these areas of the economy, the ECPC is committed to a proactive stance, and intends to identify and seek out industry expertise in these areas, as well as the expertise of data users on the topics mentioned above. ECPC Issues Paper No. 6 provides an explicit discussion of the problems to be surmounted in the classification of service industries. The ECPC will consider proposals for changes to all parts of the classification system, including industries that are not targeted for special emphasis, so long as they further the proposed long-term goals of a production-oriented classification concept for the NAICS, and a common NAICS for all three North American countries. The ECPC is mindful that many users wish to maintain time series continuity to the extent possible (see ECPC Issues Paper No. 5, "The Impact of Classification Revisions on Time Series"), and will attempt to minimize changes that are not necessary either (a) to meet requests of users or (b) for North American comparability. Classification Unit 5. The ECPC recommends that the establishment remain the unit to be classified. The Standard Industrial Classification Manual, 1987, defines an establishment as a production entity that produces goods or services at or from one location for which data are available or can be meaningfully compiled (see ECPC Issues Paper No. 1, section 1.6, and ECPC Issues Paper No. 3, "Collectibility of Data"). In those sectors of the economy where the establishment concept does not adequately portray economic activity, alternative classification units will be considered. Format for Industry Proposals 6. Proposals for new or revised 4-digit industries should be consistent with the production-oriented conceptual framework incorporated into the principles of NAICS. When formulating proposals, please note that an industry classification system groups the economic activities of establishments or producing units, which means that products and activities of the same producing unit cannot be separated in the industry classification system. Proposals must be in writing and should include the following information: (a) Specific detail about the economic activities to be covered by the proposed industry, especially its production processes, specialized labor skills, and any unique materials used. This detail should demonstrate that the proposal groups establishments that have similar production processes in accordance with the NAICS production-oriented industry concept (see Part II of this notice, ECPC Issues Paper No. 1, ECPC Reports Nos. 1 and 2, and for application of the production- oriented concept to service industries, ECPC Issues Paper No. 6). (b) Specific indication of the relationship of the proposed industry to existing U.S. SIC 4-digit industries. (c) Documentation of the size and importance of the proposed industry in the United States. (d) As noted below, information about the proposed industry in Canada and Mexico would be helpful, if available. Format for Market-Oriented Proposals 7. The ECPC will also accept proposals at this time for the alternative market-oriented product grouping system to be implemented after 1997. Such proposals must be in writing and should demonstrate that the proposed grouping includes products that are close substitutes, or that make up a marketing category, or otherwise meet the requirements for a market-oriented grouping system, as specified in ECPC Issues Paper No. 1 and Report No. 1. Please note that proposals for the market-oriented system, unlike proposals for the industry system, may cut across the activities of establishments or producing units. Evaluation Criteria 8. Proposals submitted to the ECPC requesting the creation of, or a revision to, a 4-digit industry will be evaluated using production-oriented criteria. ECPC Issues Paper No. 4, "Criteria for Determining Industries," describes some measures that may be used, e.g., the specialization ratio and the heterogeneity measure (see also ECPC Report No. 2, "The Heterogeneity Index: A Quantitative Tool to Support Industry Classification"). Other measures of the similarity among establishments will be considered and developed where necessary. For example, a coefficient of variation measure may be applied where applicable. However, all these statistical measures will supplement, not supplant, industry expertise and expert judgments about industry production processes and similarities. Some specific measures employed previously in the U.S. SIC, particularly the formula for "economic significance," will not be used in NAICS (see ECPC Issues Paper No. 4) though size and importance of a proposed industry will be considered. The coverage ratio, previously used in the U.S. SIC, is more relevant for a product-grouping system than an industry system and therefore will not be used in NAICS. Proposed industries must also include a sufficient number of companies so that Federal agencies can publish industry data without disclosing information about the operations of individual firms. The ability of government agencies to classify, collect, and publish data on the proposed basis will also be taken into account (see ECPC Issues Paper No. 3). Proposed changes must be such that they can be applied by agencies within their normal processing operations. Other Considerations 9. Persons or organizations submitting proposals should note that it is not always necessary to revise the 4-digit industries to obtain more detailed statistical information. If statistical information is needed for specific products rather than establishments, it may be more appropriate to seek changes in the detail of data collected and published by individual statistical agencies than to change the industry classification. Also, proposals for grouped data that fall under the market-oriented economic concept will be considered when the new U.S. market-oriented grouping system is developed after 1997. All proposals for new industries and for changes in the boundaries of present industries will be reviewed for North American compatibility. The existing Canadian and Mexican industry classification systems [2, 3] will be subject to a similar review. Proposals will be exchanged with Statistics Canada and INEGI, and reviewed jointly in the preparation of NAICS. It would be helpful, although not required, if written proposals for new industries in NAICS present any available information on whether the proposed industry exists in Canada or Mexico, and whether the proposal can also be implemented in those countries. PART IV. Work Plan Within the framework presented in Parts II and III above, the ECPC intends to begin the detailed development of the proposed economic classification system, the North American Industry Classification System. This notice requests specific proposals for NAICS. Public comments and input from committees of government agencies that collect, compile, and use data that are classified by economic classifications will form part of the basis for the development of the new classification structure in NAICS. The specific milestones for additional activities of the ECPC are as follows: (1) Publish Federal Register notice of proposed ECPC economic classification recommendations for public comment. (January 1996) (2) Publish Federal Register notice of final ECPC economic classification recommendations for public comment. (June 1996) (3) Publish Federal Register notice of final OMB decisions. (October 1996) (4) Begin implementation of NAICS. (January 1997) PUBLIC REVIEW PROCEDURE: All comments and proposals received in response to this notice will be available for public inspection at the Bureau of Economic Analysis (BE-42), U.S. Department of Commerce, 1441 L St., N.W., Washington, D.C. 20230. Please telephone BEA at (202) 606-9615 to make an appointment to enter the building. All proposals recommended by the ECPC will be published in the Federal Register for review and comment prior to final action by OMB. Those making proposals will be notified directly of action taken by the ECPC; others will be advised through the Federal Register. References [1] Economic Classification Policy Committee, "Summary of Public Comments to ECPC Issues Papers Nos. 1 and 2," October 1993. Available from Economic Classification Policy Committee, Bureau of Economic Analysis (BE-42), U.S. Department of Commerce, Washington, D.C. 20230, telephone number (202) 606-9615, FAX (202) 606-5311. [2] Instituto Nacional de Estadistica, Geografia e Informatica, Clasificacion Mexicana de Actividades Y Productos, 1994, Censos Economicos, 1994, 280 pages. [3] Statistics Canada, Standard Industrial Classification, 1980, Ottawa, Ontario, December 1980, pp. iii-xxviii, 3-551. Sally Katzen, Administrator Office of Information and Regulatory Affairs