(43) 'Local fishing vessel' means any fishing vessel wholly owned and controlled by: (a) the Government of the Federated States of Micronesia, any State government or any subdivision thereof; (b) one or more natural persons who are citizens of the Federated States of Micronesia; (c) any corporation, company, society, or other association of persons incorporated or established under the laws of the Federated States of Micronesia or of any State and which is wholly owned and controlled by one or more of the entities or persons described in paragraphs (a) or (b) of this subsection; and (d) any combination of persons or entities described in paragraphs (a) through (c) of this subsection.

(1) The Executive Director shall notify the applicant of the decision to issue or deny a permit, or of the need for more information, within a reasonable time of the date of receipt of the completed application. (2) The Executive Director may approve the application on such terms and conditions and with such restrictions as he deems appropriate. (3) A permit, or its renewal, may be denied where: (a) the application is not in accordance with the requirements of this subtitle; (b) the Executive Director is satisfied that information required to be given or reported under this subtitle is false, incomplete or misleading; (c) the owner or charterer is the subject of proceedings under the bankruptcy laws of any jurisdiction or on reasonable grounds appears unable to meet any financial obligations which could arise from fishing activities and reasonable financial assurances sought by the Authority have not been provided; (d) the fishing vessel does not meet required safety standards; (e) the fishing vessel does not bear the required markings; (f) an operator of the vessel has contravened or has committed an offense against the laws of the Federated States of Micronesia, or the vessel has been used for contravention of an access agreement; or (g) the Executive Director determines that the issuance of a permit would not be in the best interests of the Federated States of Micronesia. (4) A permit shall be denied where: (a) the application is made in respect of a foreign fishing vessel that does not have good standing on the Regional Register of Foreign Fishing Vessels maintained by the South Pacific Forum Fisheries Agency; (b) the operator of the vessel with respect to which application for a permit has been made has failed to satisfy a judgment or other final determination or breach of this subtitle or an access agreement or fisheries management agreement entered into pursuant to this subtitle, until such time as the judgment or other determination is satisfied; provided that a subsequent change in ownership of a vessel shall not affect the application of this provision; (c) the Executive Director determines it would be inconsistent with management measures implemented in accordance with this subtitle; (d) the required fees, royalties or other forms of compensation have not been paid in accordance with this subtitle and an applicable access agreement; or (e) the Executive Director determines that insurance requirements of this subtitle and the applicable access agreement are not fulfilled

(1) A permit issued or renewed under this subtitle shall only be valid for the species of fish, the type of fishing gear or method of fishing, or such other activity in accordance with this subtitle, as may be specified in the permit. (2) No permit shall authorize: (a) fishing by foreign fishing vessels on, over or within one nautical mile of the edge of a coral reef that is wholly submerged at mean high tide within the exclusive economic zone; (b) fishing by foreign fishing vessels within a two nautical mile radius of any fish aggregating device of the Government, a citizen or any other body established under the laws of the Federated States of Micronesia; (c) fishing using a drift net or other substantially similar method of catching fish; (d) drift net fishing activities, including the transporting, transshipping and processing of any driftnet catch, and the provisioning of food, fuel and other supplies for vessels used or outfitted for driftnet fishing. (3) A permit issued to a vessel may authorize fishing on, over or within one nautical mile of the edge of a coral reef that is wholly submerged at mean high tide within the exclusive economic zone, only if:(a) the applicant's permit application provides adequate support for marine scientific research or commercial pilot fishing in such area; and (i) with respect to commercial pilot fishing, the Authority has determined that commercial pilot fishing at the levels proposed in the permit application will not damage the sustainability of the fishery resources; or (ii) with respect to marine scientific research, the Authority has determined that the research methodology proposed in the permit application will not damage the sustainability of the fishery resources; or (b) the Authority has determined that such fishing is commercially viable and sustainable; and (c) the Executive Director has submitted a copy of the application to the Governor of the FSM State whose customary inhabitants have been traditionally ascribed the authority to control the fishing over such reef; and (d) within seventy-five (75) days of the Governor of the concerned FSM State having received such submission, the Governor of the concerned FSM State, on behalf of either the State government or the State's customary or traditional leadership, has communicated in writing to the Executive Director its consent to the issuance of the permit with respect to the reef or reefs traditionally ascribed to its customary inhabitants.

If any fishing vessel for which a permit has been issued pursuant to section 109 of this subtitle has been used in the commission of any act prohibited by this subtitle, other applicable law, an applicable access agreement, or any permit issued in accordance with this subtitle, or if any fee or civil penalty, criminal fine or other determination imposed under this subtitle has not been paid within 30 days of the due date, the Executive Director shall: (1) revoke such permit with or without prejudice to the right of any party involved to be issued a permit for such vessel in any subsequent licensing period; (2) suspend such permit for a period of time he may deem appropriate; or (3) impose additional conditions or restrictions on any such permit.

If any fishing vessel for which a permit has been issued pursuant to section 109 of this subtitle has been used in the commission of any act prohibited by this subtitle, other applicable law, an applicable access agreement, or any permit issued in accordance with this subtitle, or if any fee or civil penalty, criminal fine or other determination imposed under this subtitle has not been paid within 30 days of the due date, the Executive Director shall: (1) revoke such permit with or without prejudice to the right of any party involved to be issued a permit for such vessel in any subsequent licensing period; (2) suspend such permit for a period of time he may deem appropriate; or (3) impose additional conditions or restrictions on any such permit.

Any and all fishing vessels and fishing vessel owners which or who have had court judgments entered against them in the Supreme Court of the Federated States of Micronesia in an amount in excess of $25,000 shall be denied the ability to apply for and/or to obtain any fishing licenses of any kind whatsoever from the Authority to fish in the Exclusive Economic Zone of the Federated States of Micronesia until such judgment is satisfied.