(a) Engine and equipment manufacturers, as well as owners, operators, and rebuilders of engines subject to the requirements of this part, and all other persons, must observe the provisions of this part, the requirements and prohibitions in 40 CFR part 1068, and the provisions of the Act.

(b) This paragraph (b) describes how the replacement-engine provisions of 40 CFR 1068.240 apply for engines subject to the requirements of this part in conjunction with the secondary engine manufacturer provisions in 40 CFR 1068.262. For cases in which the secondary engine manufacturer completes assembly of the engine, these provisions apply as written. If the secondary engine manufacturer arranges for a third party to complete engine assembly, the following additional provisions apply:

(1) The ultimate purchaser must purchase (or otherwise order) the replacement engine from the secondary engine manufacturer. The secondary engine manufacturer must provide assembly instructions to the engine assembler (unless the engine being replaced was not subject to emission standards). The secondary engine manufacturer may arrange for the original engine manufacturer to ship the engine directly to the engine assembler. However, if the secondary engine manufacturer does not take possession of the engine, it must supply the engine label specified in 40 CFR 1068.240 to the engine assembler and the engine assembler must apply the label before shipping the engine.

(2) The secondary engine manufacturer and engine assembler are both responsible if the engine is installed in new equipment or otherwise violates the circumvention provisions of 40 CFR 1068.240.

(3) Consider the following example. A secondary engine manufacturer receiving a valid request for a replacement engine for which it does not already have an engine available in inventory may order a partially complete engine from an original engine manufacturer and have it shipped directly to an independent engine assembler. In this case, the secondary engine manufacturer must state in its order that the partially complete engine should be labeled as being exempt under 40 CFR 1068.240 and identify the engine assembler's address; the secondary engine manufacture must also provide instructions to the engine assembler. The original engine manufacturer would label the engine as described in 40 CFR 1068.262, identifying the replacement-engine exemption as the basis for shipping an uncertified engine, and ship the engine directly to the assembler. The engine assembler would complete the assembly by applying the label and otherwise following the instructions provided by the secondary engine manufacturer.

[73 FR 59241, Oct. 8, 2008]