[Federal Register: October 18, 2010 (Volume 75, Number 200)]
[Rules and Regulations]
[Page 63714-63717]
[DOCID:fr18oc10-10]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[USCG-2010-0864]
RIN 1625-AA87

Security Zone: Passenger Vessels, Sector Southeastern New England
Captain of the Port Zone

AGENCY: Coast Guard, DHS.

ACTION: Temporary final rule.

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SUMMARY: The Coast Guard is establishing temporary fixed and moving
security zones around passenger vessels in the Sector Southeastern New
England Captain of the Port Zone. A fixed security zone will be in
effect within a maximum 100-yard radius of any passenger vessel
anchored, moored, or in the process of mooring and a moving security
zone up to 200 yards for any passenger vessel underway being escorted
by Coast Guard or forces under Coast Guard control (such as assisting
law enforcement agencies). These zones are needed to protect

passengers, vessels and the public from destruction, loss, or injury
from sabotage, subversive acts, or other malicious acts of a similar
nature. This temporary final rule is an interim measure while a
permanent rulemaking process is pursued separately under docket USCG-
2010-0803.

DATES: This rule is effective in the CFR from October 18, 2010 until
April 1, 2011. This rule is effective with actual notice for purposes
of enforcement from September 22, 2010, until 8 a.m. on April 1, 2011.

ADDRESSES: Documents indicated in this preamble as being available in
the docket are part of docket USCG-2010-0864 and are available online
by going to http://www.regulations.gov, inserting USCG-2010-0864 in the
``Keyword'' box, and then clicking ``Search''. They are also available
for inspection or copying at the Docket Management Facility (M-30),
U.S. Department of Transportation, West Building Ground Floor, Room
W12-140, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: If you have questions on this
temporary rule, call or e-mail Mr. Edward G. LeBlanc at Sector
Southeastern New England; telephone<PHONE_NUMBER>, e-mail
<EMAIL_ADDRESS>If you have questions on viewing the docket,
call Renee V. Wright, Program Manager, Docket Operations, telephone
202-366-9826.

SUPPLEMENTARY INFORMATION:

Regulatory Information

    The Coast Guard is issuing this temporary final rule without prior
notice and opportunity to comment pursuant to authority under section
4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This
provision authorizes an agency to issue a rule without prior notice and
opportunity to comment when the agency for good cause finds that those
procedures are ``impracticable, unnecessary, or contrary to the public
interest.'' Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good
cause exists for not publishing a notice of proposed rulemaking (NPRM)
with respect to this rule because these temporary security zones are a
necessary and key component of the Coast Guard's maritime security
mission in Southeastern New England, and a separate notice of proposed
rulemaking will be pursued, where the public will be afforded ample
opportunity to comment. Delaying the effective date of this rule to
provide a public notice and comment period for this temporary final
rule is contrary to national security concerns and the public interest.
    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause
exists for making this rule effective less than 30 days after
publication in the Federal Register. Any delay encountered in this
temporary rule's effective date would be contrary to the public
interest given the need to protect passenger vessels from destruction,
loss, or injury from sabotage, subversive acts, or other malicious acts
of a similar nature.

Basis and Purpose

    The Coast Guard's maritime security mission includes the
requirement to protect passenger vessels from destruction, loss, or
injury from sabotage, subversive acts, or other malicious acts of a
similar nature. Protecting these vessels from potential threats or harm
while transiting, or while moored, at any berth, or at anchor in the
waters of Sector Southeastern New England Captain of The Port Zone is
necessary to safeguard passengers, vessels, and the general public.

Discussion of Rule

    This regulation establishes temporary fixed security zones that
will be in effect in the navigable waters within a maximum 100-yard
radius around passenger vessels that are moored, or in the process of
mooring, at any berth or at anchor within the Sector Southeastern New
England Captain of the Port Zone. This regulation also establishes
fixed moving security zones that will be in effect in the navigable
waters up to 200 yards around escorted passenger vessels while underway
in the navigable waters within the Sector Southeastern New England
Captain of the Port Zone. The definition of passenger vessels to which
these zones apply are passenger vessels over 100 gross tons authorized
to carry more than 500 passengers for hire making voyages, any part of
which is on the high seas, and for which passengers are embarked,
disembarked or pay a port call, in the Sector Southeastern New England
Captain of the Port Zone. These high-capacity passenger vessels
typically are greater than 200 feet in length and have multiple decks.
These security zones are necessary to safeguard passenger vessels,
persons aboard passenger vessels, the public, waterways, ports, and
adjacent facilities in the Sector Southeastern New England Captain of
the Port Zone.

Regulatory Analyses

    We developed this rule after considering numerous statutes and
executive orders relating to rulemaking. Below we summarize our
analyses based on 13 of these statutes or executive orders.

Regulatory Planning and Review

    This rule is not a ``significant regulatory action'' under section
3(f) of Executive Order 12866, Regulatory Planning and Review, and does
not require an assessment of potential costs and benefits under section
6(a)(3) of that Order. The Office of Management and Budget has not
reviewed it under that Order.
    The Coast Guard expects the economic impact of this rule to be so
minimal that a full regulatory evaluation under the regulatory policies
and procedures of DHS is unnecessary. The effect of this rule will not
be significant. Temporary moving security zones will only be in effect
while escorted passenger vessels are underway, and the zone will not
restrict any waterway for a long period of time. The vast majority of
passenger vessel transits in the waters of Sector Southeastern New
England Captain of the Port Zone are less than two hours. Temporary
fixed security zones around passenger vessels that are moored, or in
the process of mooring, at any berth or at anchor are anticipated to
have minimal impact on vessel traffic because such vessels anchored or
moored in designated anchorages or at waterfront facilities are away
from navigation channels used by mariners. Additionally, vessels may be
permitted to enter these security zones with expressed permission of
the Captain of the Port, minimizing any adverse impact. It has been
determined that the necessary security enhancements provided by this
rule greatly outweigh any potential negative impacts.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have
considered whether this rule would have a significant economic impact
on a substantial number of small entities. The term ``small entities''
comprises small businesses, not-for-profit organizations that are
independently owned and operated and are not dominant in their fields,
and governmental jurisdictions with populations of less than 50,000.
    The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will
not have a significant economic impact on a substantial number of small
entities.
    This rule may affect the following entities, some of which may be
small entities: The owners and operators of vessels intending to
transit the waters of Sector Southeastern New England Captain of the
Port Zone while the

security zones are enforced. These security zones will not have a
significant impact on a substantial number of small entities for the
following reasons: The moving security zones will only be enforced when
an escorted passenger vessel is underway, and such transits in the
Sector Southeastern New England Captain of the Port Zone are typically
less than two hours in duration; the fixed security zones around
passenger vessels moored, or in the process of mooring, at a berth or
at anchorage, allow for vessel traffic to transit the navigable waters
outside the zone. Additionally, vessels may be permitted to enter these
security zones with the express prior permission of the Captain of the
Port, minimizing any adverse impact.

Assistance for Small Entities

    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small
entities in understanding the rule so that they could better evaluate
its effects on them and participate in the rulemaking process. If you
think your small business or organization would be affected by this
rule and you have any questions concerning its provisions or options
for compliance, please call Mr. Edward G. Leblanc at<PHONE_NUMBER>.
    Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247). The Coast Guard will not retaliate against small
entities that question or complain about this rule or any policy or
action of the Coast Guard.

Collection of Information

    This rule calls for no new collection of information under the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

Federalism

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has a substantial direct effect on State or local
governments and would either preempt State law or impose a substantial
direct cost of compliance on them. We have analyzed this rule under
that Order and have determined that it does not have implications for
federalism.

Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their discretionary
regulatory actions. In particular, the Act addresses actions that may
result in the expenditure by a State, local, or tribal government, in
the aggregate, or by the private sector of $100,000,000 (adjusted for
inflation) or more in any one year. Though this rule will not result in
such expenditure, we do discuss the effects of this rule elsewhere in
this preamble.

Taking of Private Property

    This rule will not cause a taking of private property or otherwise
have taking implications under Executive Order 12630, Governmental
Actions and Interference With Constitutionally Protected Property
Rights.

Civil Justice Reform

    This rule 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.

Protection of Children

    We have analyzed this rule under Executive Order 13045, Protection
of Children From Environmental Health Risks and Safety Risks. This rule
is not an economically significant rule and does not create an
environmental risk to health or risk to safety that may
disproportionately affect children.

Indian Tribal Governments

    This rule does not have tribal implications under Executive Order
13175, Consultation and Coordination With Indian Tribal Governments,
because it does not have a substantial direct effect on one or more
Indian tribes, on the relationship between the Federal Government and
Indian tribes, or on the distribution of power and responsibilities
between the Federal Government and Indian tribes.

Energy Effects

    We have analyzed this rule under Executive Order 13211, Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use. We have determined that it is not a ``significant
energy action'' under that order because it is not a ``significant
regulatory action'' under Executive Order 12866 and is not likely to
have a significant adverse effect on the supply, distribution, or use
of energy. The Administrator of the Office of Information and
Regulatory Affairs has not designated it as a significant energy
action. Therefore, it does not require a Statement of Energy Effects
under Executive Order 13211.

Technical Standards

    The National Technology Transfer and Advancement Act (NTTAA) (15
U.S.C. 272 note) directs agencies to use voluntary consensus standards
in their regulatory activities unless the agency provides Congress,
through the Office of Management and Budget, with an explanation of why
using these standards would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., specifications of materials, performance, design, or
operation; test methods; sampling procedures; and related management
systems practices) that are developed or adopted by voluntary consensus
standards bodies. This rule does not use technical standards.
Therefore, we did not consider the use of voluntary consensus
standards.

Environment

    We have analyzed this rule under Department of Homeland Security
Management Directive 023-01 and Commandant Instruction M16475.lD, which
guide the Coast Guard in complying with the National Environmental
Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded
this action is one of a category of actions which do not individually
or cumulatively have a significant effect on the human environment.
This rule is categorically excluded, under figure 2-1, paragraph
(34)(g) of the Instruction. This rule fits the category selected from
paragraph (34)(g), as it establishes a temporary security zone for a
limited period of time. A final ``Environmental Analysis Check List''
and a final ``Categorical Exclusion Determination'' will be available
in the docket where indicated under ADDRESSES.

List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reports and
recordkeeping requirements, Security measures, and Waterways.

0
For the reasons discussed in the preamble, the Coast Guard amends 33
CFR part 165 as follows:

PART 165--REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS

0
1. The authority citation for part 165 continues to read as follows:

    Authority:  33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701, 3306,
3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5;
Pub. L. 107-295, 116 Stat. 2064; Department of Homeland Security
Delegation No. 0170.1.

0
2. Add Sec.  165.T01-0864 to read as follows:

Sec.  165.T01-0864  Security Zone: Escorted Passenger Vessels, Sector
Southeastern New England Captain of the Port Zone.

    (a) Location. The following areas are security zones: All navigable
waters within the Sector Southeastern New England Captain of the Port
Zone, extending from the surface to the sea floor, that are:
    (1) Within a maximum 200-yard radius of any passenger vessel that
is underway and is under escort of U.S. Coast Guard law enforcement
personnel, or
    (2) Within a maximum 100-yard radius of any passenger vessel that
is anchored, at any berth, moored, or in the process of mooring.
    (b) Definitions. As used in this section--
    Designated representative means any Coast Guard commissioned,
warrant, or petty officer who has been designated by the Captain of the
Port to act on his behalf. The on-scene representative may be on a
Coast Guard vessel, or onboard a Federal, State, or local agency vessel
that is authorized to act in support of the Coast Guard.
    Passenger vessel means any passenger vessel over 100 gross tons
authorized to carry more than 500 passengers for hire making voyages,
any part of which is on the high seas, and for which passengers are
embarked, disembarked or pay a port call, in the Sector Southeastern
New England Captain of the Port Zone.
    Sector Southeastern New England Captain of the Port Zone means the
area defined in 33 CFR 3.05-20.
    (c) Notification. Sector Southeastern New England Captain of the
Port will give actual notice to mariners for the purpose of enforcement
of this temporary security zone. In addition, the Coast Guard will
broadcast the area designated as a security zone for the duration of
the enforcement period via Broadcast Notice to Mariners.
    (d) Effective and enforcement period. This rule is effective with
actual notice for purposes of enforcement from September 22, 2010,
through 8 a.m. on April 1, 2011.
    (c) Regulations. (1) In accordance with the general regulations in
Sec.  165.33 of this part, entry into or movement within these zones is
prohibited unless authorized by the Captain of the Port Southeastern
New England or his designated representative.
    (2) All persons and vessels must comply with the instructions of
the Captain of the Port or his designated representative. Emergency
response vessels are authorized to move within the zone, but must abide
by the restrictions imposed by the Captain of the Port or his
designated representative.
    (3) No person may swim upon or below the surface of the water
within the boundaries of these security zones unless previously
authorized by the Captain of the Port or his designated representative.
    (4) Upon being hailed by a U.S. Coast Guard vessel or his
designated representative, by siren, radio, flashing light or other
means, the operator of the vessel shall proceed as directed.
    (5) Vessel operators desiring to enter or operate within the
security zone shall contact the Captain of the Port or his designated
representative via VHF channel 16 to obtain permission to do so.

    Dated: September 22, 2010.
V.B. Gifford, Jr.,
Captain, U.S. Coast Guard, Captain of the Port, Southeastern New
England.
[FR Doc. 2010-26099 Filed 10-15-10; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register Volume 82, Number 219 (Wednesday, November 15, 2017)]
[Notices]
[Pages 52962-52963]
[FR Doc No: 2017-24660]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82041; File No. SR-ICEEU-2017-012]

Self-Regulatory Organizations; ICE Clear Europe Limited; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change
Relating to Amendments to the ICE Clear Europe Delivery Procedures

November 8, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on October 31, 2017, ICE Clear Europe Limited (``ICE Clear Europe'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule changes described in Items I, II, and III below, which
Items have been prepared by ICE Clear Europe. ICE Clear Europe filed
the proposed rule change pursuant to Section 19(b)(3)(A) of the Act,\3\
and Rule 19b-4(f)(4)(ii) \4\ thereunder, so that the proposal was
immediately effective upon filing with the Commission. The Commission
is publishing this notice to solicit comments on the proposed rule
change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(ii).
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change, Security-Based Swap Submission, or Advance Notice

    The principal purpose of the proposed rule change is to implement
certain amendments and updates to the ICE Clear Europe Delivery
Procedures relating to European emissions and UK electricity contracts.

II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change, Security-Based Swap Submission or
Advance Notice

    In its filing with the Commission, ICE Clear Europe included
statements concerning the purpose of and basis for the proposed rule
change. The text of these statements may be examined at the places
specified in Item IV below. ICE Clear Europe has prepared summaries,
set forth in sections (A), (B), and (C) below, of the most significant
aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change, Security-Based Swap Submission or
Advance Notice

(a) Purpose
    ICE Clear Europe proposes to implement certain amendments and
updates to the ICE Clear Europe Delivery Procedures relating to
European emissions and UK electricity contracts. The proposed
amendments are designed (i) to update the Delivery Procedures relating
to deliveries under European emissions and UK power contracts to be
consistent with current practice and reflect the use of updated
delivery forms and processes and (ii) to remove certain references to
contracts no longer traded.
    In Part A of the Delivery Procedures (relating to European
emissions contracts), ICE Clear Europe is modifying the timing for
submission of delivery confirmation forms to be consistent with the
timing of the expiration of the relevant contracts.
    In Part C of the Delivery Procedures (relating to UK electricity
contracts), ICE Clear Europe is removing certain references (and
related provisions) for contracts that are no longer traded. The
amendments also remove references to a pre-delivery authorization
process and certain reports that are no longer used, as well as extend
the deadline for certain authorization requests, in light of updates to
ICE Clear Europe systems. In addition, the amendments modify the timing
for submission of certain delivery confirmation forms to be consistent
with the timing of the expiration of the relevant contracts.
(b) Statutory Basis
    ICE Clear Europe believes that the proposed amendments are
consistent with the requirements of Section 17A of the Act \5\ and the
regulations thereunder applicable to it, including the standards under
Rule 17Ad-22.\6\
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    \5\ 15 U.S.C. 78q-1.
    \6\ 17 CFR 240.17Ad-22.
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    Section 17A(b)(3)(F) of the Act \7\ requires, among other things,
that the rules of a clearing agency be designed to promote the prompt
and accurate clearance and settlement of securities transactions and,
to the extent applicable, derivative agreements, contracts, and
transactions, the safeguarding of securities and funds in the custody
or control of the clearing agency or for which it is responsible, and
the protection of investors and the public interest. Rule 17Ad-
22(e)(10) \8\ requires that each covered clearing agency shall
establish, implement, maintain and enforce written policies and
procedures reasonably designed to establish and maintain transparent
written standards that state its obligations with respect to the
delivery of physical instruments, and establish and maintain
operational practices that identify, monitor, and manage the risks
associated with such physical deliveries. The proposed amendments are
being made to update and clarify the ICE Clear Europe delivery
procedures to make operational and documentation improvements in the
delivery confirmation and notification processes. As a result, in ICE
Clear Europe's view, the amendments will facilitate the prompt and
accurate clearance and settlement of cleared transactions, more clearly
state the obligations of parties with respect to deliveries and the
management of the risks of such deliveries, within the meaning of the
Act and Rule 17Ad-22(e).
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    \7\ 15 U.S.C. 78q-1(b)(3)(F).
    \8\ 17 CFR 240.17Ad-22(e)(10).
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(B) Clearing Agency's Statement on Burden on Competition

    ICE Clear Europe does not believe the proposed changes to the rules
would have any impact, or impose any burden, on competition not
necessary or appropriate in furtherance of the purpose of the Act. ICE
Clear Europe is adopting the amendments the Delivery Procedures and
Clearing Procedures in order to clarify certain aspects of the exercise
and settlement of equity futures and options currently cleared by ICE
Clear Europe. ICE Clear Europe does not believe the adoption of related
Delivery Procedures and Clearing Procedures amendments would materially
affect the cost of clearing these products, adversely affect access to
clearing in these products for Clearing Members or their customers, or
otherwise adversely affect competition in clearing services.

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants or Others

    Written comments relating to the proposed changes to the rules have
not been solicited or received. ICE Clear Europe will notify the
Commission of any written comments received by ICE Clear Europe.

III. Date of Effectiveness of the Proposed Rule Change, Security-Based
Swap Submission and Advance Notice and Timing for Commission Action

    The foregoing rule change has become effective upon filing pursuant
to Section 19(b)(3)(A) \9\ of the Act and Rule 19b-4(f)(4)(ii) \10\
thereunder because it effects a change in an existing service of a
registered clearing agency that primarily affects the clearing
operations of the clearing agency with respect to products that are not
securities, including futures that are not security futures, swaps that
are not security-based swaps or mixed swaps, and forwards that are not
security forwards, and does not significantly affect any securities
clearing operations of the clearing agency or any rights or obligations
of the clearing agency with respect to securities clearing or persons
using such securities-clearing service. At any time within 60 days of
the filing of the proposed rule change, the Commission summarily may
temporarily suspend such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml) or
     Send an email to [email protected]. Please include
File Number SR-ICEEU-2017-012 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-ICEEU-2017-012. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such filings will also be available
for inspection and copying at the principal office of ICE Clear Europe
and on ICE Clear Europe's Web site at https://www.theice.com/clear-europe/regulation#rule-filings.
    All comments received will be posted without change. Persons
submitting comments are cautioned that we do not redact or edit
personal identifying information from comment submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-ICEEU-2017-012 and should be
submitted on or before December 6, 2017.

For the Commission, by the Division of Trading and Markets, pursuant
to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-24660 Filed 11-14-17; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 75, Number 235 (Wednesday, December 8, 2010)]
[Notices]
[Pages 76502-76503]
[FR Doc No: 2010-30829]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63405; File No. SR-NSX-2010-15]

Self-Regulatory Organizations; National Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Effectuate an Amendment to Bylaws of NSX Holdings, Inc.

December 1, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 19, 2010, National Stock Exchange, Inc. filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change, as described in Items I and II below, which Items have been
prepared by the Exchange. The Commission is publishing this notice to
solicit comment on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    National Stock Exchange, Inc. (``NSX[supreg] '' or ``Exchange'') is
proposing to effectuate an amendment to the bylaws of its parent
holding company, NSX Holdings, Inc., to extend the expiration date,
from December 31, 2010 to December 31, 2015, of a right of first
refusal in the bylaws covering the transfer of Holdings shares.
    The text of the proposed rule change is available on the Exchange's
Web site at http://www.nsx.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant parts of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    With this rule change, the Exchange is proposing to effectuate an
amendment to the bylaws of its parent holding company, NSX Holdings,
Inc. (``Holdings''), to extend the expiration date of a right of first
refusal regarding the transfer of Holdings shares from December 31,
2010 until December 31, 2015.
    Holdings is the sole stockholder of the Exchange. Holdings is a
privately-held company and there is no public market for its shares.
Pursuant to section 9.6 of Holdings' bylaws, shares of Holdings may not
be sold, transferred, assigned, pledged or otherwise disposed of
without complying with transfer restrictions contained in Holdings'
charter and bylaws. The bylaws generally provide that stockholders may
not transfer less than 1,000 shares in any one transfer, unless the
stockholder is transferring all of the Holdings shares it owns. The
bylaws also grant Holdings a right of first refusal to acquire shares a
stockholder intends to sell or transfer. This right of first refusal
does not apply (a) If the transferee is an affiliate of the transferor,
(b) if the transferee is already a stockholder of Holdings, (c) if the
transfer is by bequest, operation of law or judicial decree upon the
death, legal disability, bankruptcy, or divorce/annulment/dissolution
of marriage of a stockholder, or (d) after December 31, 2010.\3\
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    \3\ Shares of Holdings have not been registered under the
Securities Act of 1933 or any state securities laws. As a result,
they may be transferred only pursuant to an effective registration
statement, or upon delivery to Holdings of an opinion of counsel
that the transfer is exempt from such registration requirements and
the delivery of documentation necessary to demonstrate that the
transfer is exempt. Stockholders who wish to sell or transfer
shares, or who have questions concerning sale or transfer
restrictions, are encouraged to consult their legal counsel.
---------------------------------------------------------------------------

    On October 6, 2010, the Holdings Board of Directors approved,
subject to any required Securities and Exchange Commission
(``Commission'') approval, an amendment to Holdings' bylaws to extend
the expiration date for the right of first refusal referenced above
from December 31, 2010 until December 31, 2015. Accordingly, the
instant rule filing proposes to effectuate an amendment to Holdings'
bylaws that would extend the right of first refusal until December 31,
2015.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6(b) of the Act,\4\ in general, and
Section 6(b)(4) of the Act,\5\ in particular, in that it is designed,
among other things, to promote clarity, transparency and full
disclosure, in so doing, to prevent fraudulent and manipulative acts
and practices, to promote just and equitable principles of trade, to
remove impediments to and perfect the mechanism of a free and open
market and a national market system, and, in general, to protect
investors and the public interest. Moreover, the proposed rule change
is not discriminatory in that it affects only the rights of Holdings
shareholders; qualification of, and trading privileges resulting from,
ETP Holder status is unrelated to and independent of a person's or
entity's status as a Holdings shareholder.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any inappropriate burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    The Exchange has neither solicited nor received written comments on
the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The proposed rule change will not be operative until 30 days after
the date of filing (or such shorter time as the Commission may
designate) pursuant to Section 19(b)(3)(A)(ii) of the Act \6\ and
subparagraph (f)(6) of Rule 19b-4 \7\ thereunder, because the proposal
is ``non-controversial'' and: (1) Does not significantly affect the
protection of investors or the public interest; (2) does not impose any
significant burden on competition; and (3) does not become operative
for 30 days from the date of filing, or such shorter time as the
Commission may designate if consistent with the protection of investors
and the public interest; provided that the self-regulatory organization
has given the

Commission written notice of its intent to file the proposed rule
change at least five business days prior to the filing date of the
proposed rule change.\8\ Pursuant to Rule 19b-4(f)(6)(iii) under the
Act,\9\ the Commission may designate a shorter time period if such
action is consistent with the protection of investors and the public
interest. At any time within sixty (60) days of the filing of such
proposed rule change, the Commission summarily may temporarily suspend
such rule change if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \7\ 17 CFR 240.19b-4.
    \8\ As required under Rule 19b-4(f)(6)(iii), NSX provided the
Commission with written notice of its intent to file the proposed
rule change at least five business days prior to the filing date.
    \9\ 17 CFR 19b-4(f)(6)(iii).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an E-mail to<EMAIL_ADDRESS>Please include
File No. SR-NSX-2010-15 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NSX-2010-15. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room. Copies of such
filing also will be available for inspection and copying at the
principal office of the NSX. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NSX-2010-15 and should be submitted by December 29,
2010.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-30829 Filed 12-7-10; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 88, Number 99 (Tuesday, May 23, 2023)]
[Rules and Regulations]
[Pages 32956-32959]
[FR Doc No: 2023-10996]

-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2023-1049; Project Identifier AD-2023-00591-R;
Amendment 39-22441; AD 2023-10-05]
RIN 2120-AA64

Airworthiness Directives; Leonardo S.p.a. Helicopters

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule; request for comments.

-----------------------------------------------------------------------

SUMMARY: The FAA is superseding Emergency Airworthiness Directive (AD)
2023-07-51, which applied to all Leonardo S.p.a. Model AB139 and AW139
helicopters and which was previously sent to all known U.S. owners and
operators of those helicopters. Emergency AD 2023-07-51 required
inspecting for a gap between the main rotor (M/R) pitch link upper rod
end assembly bearing and the pitch control lever assembly and,
depending on the results, replacing or re-identifying the M/R pitch
link upper rod end assembly. Emergency AD 2023-07-51 also prohibited
installing an affected M/R pitch link upper rod end assembly. Since the
FAA issued Emergency AD 2023-07-51, it has been determined that a gap
between the M/R pitch link upper rod end assembly bearing and the pitch
control lever assembly that is within a certain dimension tolerance is
acceptable. This AD continues to require the actions in Emergency AD
2023-07-51, as specified in a European Union Aviation Safety Agency
(EASA) AD, which is incorporated by reference in this AD, but allows a
gap of less than 0.5 mm. The FAA is issuing this AD to address the
unsafe condition on these products.

DATES: This AD is effective June 7, 2023.
    The Director of the Federal Register approved the incorporation by
reference of a certain publication listed in this AD as of June 7,
2023.
    The FAA must receive comments on this AD by July 7, 2023.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to regulations.gov. Follow
the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: Deliver to Mail address above between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    AD Docket: You may examine the AD docket at regulations.gov under
Docket No. FAA-2023-1049; or in person at Docket Operations between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD
docket contains this final rule, any comments received, and other
information. The street address for Docket Operations is listed above.
    Material Incorporated by Reference:
     For EASA material that is incorporated by reference in
this final rule, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne,
Germany; telephone +49 221 8999 000; email [email protected]; internet
easa.europa.eu. You may find the EASA material on the EASA website at
ad.easa.europa.eu.
     You may view this service information at the FAA, Office
of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room
6N-321, Fort Worth, TX 76177. For information on the availability of
this material at the FAA, call<PHONE_NUMBER>. It is also available at
regulations.gov under Docket No. FAA-2023-1049.
    Other Related Service Information: For Leonardo Helicopters service
information that is identified in this final rule, contact Leonardo
S.p.A., Emanuele Bufano, Head of Airworthiness, Viale G. Agusta 520,
21017 C Costa di Samarate (Va) Italy; telephone (+39) 0331-225074; fax
(+39) 0331-229046; or at customerportal.leonardocompany.com/en-US/. You
may also view this service information at the FAA contact information
under Material Incorporated by Reference above.

FOR FURTHER INFORMATION CONTACT: Dan McCully, Program Manager,
International Validation Branch, FAA, 1600 Stewart Ave., Suite 410,
Westbury, NY 11590; telephone<PHONE_NUMBER>; email
[email protected].

SUPPLEMENTARY INFORMATION:

Comments Invited

    The FAA invites you to send any written data, views, or arguments
about this final rule. Send your comments to an address listed under
ADDRESSES. Include ``Docket No. FAA-2023-1049; Project Identifier AD-
2023-00591-R'' at the beginning of your comments. The most helpful
comments reference a specific portion of the final rule, explain the
reason for any recommended change, and include supporting data. The FAA
will consider all comments received by the closing date and may amend
this final rule because of those comments.
    Except for Confidential Business Information (CBI) as described in
the following paragraph, and other information as described in 14 CFR
11.35, the FAA will post all comments received, without change, to
regulations.gov, including any personal information you provide. The
agency will also post a report summarizing each substantive verbal
contact received about this final rule.

Confidential Business Information

    CBI is commercial or financial information that is both customarily
and actually treated as private by its owner. Under the Freedom of
Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public
disclosure. If your comments responsive to this AD contain commercial
or financial information that is customarily treated as private, that
you actually treat as private, and that is relevant or responsive to
this AD, it is important that you clearly designate the submitted
comments as CBI. Please mark each page of your submission containing
CBI as ``PROPIN.'' The FAA will treat such marked submissions as
confidential under the FOIA, and they will not be placed in the public
docket of this AD. Submissions containing CBI should be sent to Dan
McCully, Program Manager, International Validation Branch, FAA, 1600
Stewart Ave., Suite 410, Westbury, NY 11590; telephone<PHONE_NUMBER>;
email [email protected]. Any commentary that the FAA receives
which is not specifically designated as CBI will be placed in the
public docket for this rulemaking.

Background

    The FAA issued Emergency AD 2023-07-51 on March 31, 2023, to
address an unsafe condition on all Leonardo S.p.a. Model AB139 and
AW139 helicopters.

The FAA sent Emergency AD 2023-07-51 to all known U.S. owners and
operators of those helicopters.
    Emergency AD 2023-07-51 required inspecting for a gap between the
M/R pitch link upper rod end assembly bearing and the pitch control
lever assembly and, depending on the results, replacing or re-
identifying the M/R pitch link upper rod end assembly. Emergency AD
2023-07-51 also prohibited installing an affected M/R pitch link upper
rod end assembly.
    Emergency AD 2023-07-51 was prompted by EASA Emergency AD 2023-
0071-E, dated March 31, 2023 (EASA AD 2023-0071-E), issued by EASA,
which is the Technical Agent for the Member States of the European
Union. EASA advises of a report of excessive play of a bearing
installed in an M/R pitch link upper rod end assembly part number (P/N)
3G6230A01133. EASA also advises that subsequent investigation revealed
that the excessive play was due to incorrect installation of the
bearing during production. You may examine EASA AD 2023-0071-E in the
AD docket at regulations.gov under Docket No. FAA-2023-1049.
    The FAA issued Emergency AD 2023-07-51 to detect incorrect
installation of a bearing. This condition, if not addressed, could
result in a crack in the M/R pitch link upper rod end assembly, failure
of the M/R pitch link upper rod end assembly, and subsequent loss of
control of the helicopter.

Actions Since Emergency AD 2023-07-51 Was Issued

    Since the FAA issued Emergency AD 2023-07-51, Leonardo Helicopters
contacted the FAA and clarified that a gap not exceeding 0.5 mm between
the pitch link top bearing and associated seat is permitted in the
service information required by EASA AD 2023-0071-E to accommodate the
sliding of the bushing into the lug per design. Leonardo Helicopters
also stated that prohibiting any gap may ground some helicopters that
are within design parameters. Leonardo Helicopters subsequently
submitted a request for a global alternative method of compliance
(AMOC), which the FAA approved. The global AMOC allowed measuring the
gap between the M/R pitch link upper rod end assembly bearing and the
pitch control lever assembly on each side without cleaning the area or
using a feeler gauge. The approved global AMOC also allowed a gap up to
and including 0.5 mm in width. From additional review since issuance of
the global AMOC, the FAA has determined that cleaning the inspection
area and using a feeler gauge for the inspection are required. The FAA
has also reduced the maximum allowable gap to less than 0.5 mm.
Accordingly, the global AMOC approved for Emergency AD 2023-07-51 is
not approved as an AMOC for the corresponding requirements of this AD.

Related Service Information Under 1 CFR Part 51

    EASA AD 2023-0071-E requires a one-time dimensional check of
affected M/R pitch link upper rod end assemblies and, depending on the
results, replacing or re-identifying the affected part. EASA AD 2023-
0071-E also prohibits installing an affected M/R pitch link upper rod
end assembly.
    This material is reasonably available because the interested
parties have access to it through their normal course of business or by
the means identified in ADDRESSES.

Other Related Service Information

    The FAA reviewed Leonardo Helicopters Emergency Alert Service
Bulletin No. 139-754, dated March 31, 2023. This service information
specifies procedures for certain serial-numbered M/R pitch link upper
rod end assemblies P/N 3G6230A01133 that are not marked with the letter
``R.'' This service information specifies a one-time inspection by
cleaning the upper M/R pitch link upper rod end assembly bearing, bolt,
and pitch lever assembly; and using a feeler gauge to inspect for a
gap. Depending on the results, this service information specifies
procedures for replacing the M/R pitch link upper rod end assembly,
completing an inspection report, contacting LHD [Leonardo Helicopters
Division], and sending the removed M/R pitch link upper rod end
assembly to LHD; or marking the letter ``R'' near the M/R pitch link
upper rod end assembly serial number.

FAA's Determination

    These products have been approved by the aviation authority of
another country and are approved for operation in the United States.
Pursuant to the FAA's bilateral agreement with this State of Design
Authority, it has notified the FAA of the unsafe condition described in
its AD and the service information described above. The FAA is issuing
this AD after determining that the unsafe condition described
previously is likely to exist or develop on other products of these
same type designs.

AD Requirements

    This AD requires accomplishing the actions specified in EASA AD
2023-0071-E, described previously as incorporated by reference, except
for any differences identified as exceptions in the regulatory text of
this AD and except as discussed under ``Differences Between this AD and
the EASA AD.''

Explanation of Required Compliance Information

    In the FAA's ongoing efforts to improve the efficiency of the AD
process, the FAA developed a process to use some civil aviation
authority (CAA) ADs as the primary source of information for compliance
with requirements for corresponding FAA ADs. The FAA has been
coordinating this process with manufacturers and CAAs. As a result,
EASA AD 2023-0071-E is incorporated by reference in this FAA final
rule. This AD, therefore, requires compliance with EASA AD 2023-0071-E
in its entirety through that incorporation, except for any differences
identified as exceptions in the regulatory text of this AD. Using
common terms that are the same as the heading of a particular section
in EASA AD 2023-0071-E does not mean that operators need comply only
with that section. For example, where the AD requirement refers to
``all required actions and compliance times,'' compliance with this AD
requirement is not limited to the section titled ``Required Action(s)
and Compliance Time(s)'' in EASA AD 2023-0071-E. Service information
referenced in EASA AD 2023-0071-E for compliance will be available at
regulations.gov under Docket No. FAA-2023-1049 after this final rule is
published.

Differences Between This AD and the EASA AD

    EASA AD 2023-0071-E requires a dimensional check before next
flight, whereas this AD requires inspecting for a gap within four
calendar days. EASA AD 2023-0071-E requires re-identifying an affected
M/R pitch link upper rod end assembly that passed the dimensional
inspection within 25 flight hours or at the next removal of an affected
part, whichever occurs first, whereas this AD requires that action
within 25 hours time-in-service.

Justification for Immediate Adoption and Determination of the Effective
Date

    Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5
U.S.C. 551 et seq.) authorizes agencies to dispense with notice and
comment procedures for rules when the agency, for ``good cause,'' finds
that those procedures are ``impracticable, unnecessary, or contrary to
the public interest.'' Under this section, an agency,

upon finding good cause, may issue a final rule without providing
notice and seeking comment prior to issuance. Further, section 553(d)
of the APA authorizes agencies to make rules effective in less than
thirty days, upon a finding of good cause.
    An unsafe condition exists that required the immediate adoption of
Emergency AD 2023-07-51, issued on March 31, 2023, to all known U.S.
owners and operators of these helicopters. The FAA found that the risk
to the flying public justifies foregoing notice and comment prior to
adoption of this rule because the main rotor pitch link upper rod end
assembly is critical to the control of a helicopter and failure of the
main rotor pitch link upper rod end assembly could occur during any
phase of flight without previous indication. The FAA has no information
pertaining to how quickly the condition may propagate to failure. Thus,
the required inspection must be accomplished within four calendar days.
These conditions still exist, therefore, notice and opportunity for
prior public comment are impracticable and contrary to the public
interest pursuant to 5 U.S.C. 553(b)(3)(B).
    In addition, the FAA finds that good cause exists pursuant to 5
U.S.C. 553(d) for making this amendment effective in less than 30 days,
for the same reasons the FAA found good cause to forgo notice and
comment.

Regulatory Flexibility Act

    The requirements of the Regulatory Flexibility Act (RFA) do not
apply when an agency finds good cause pursuant to 5 U.S.C. 553 to adopt
a rule without prior notice and comment. Because FAA has determined
that it has good cause to adopt this rule without prior notice and
comment, RFA analysis is not required.

Costs of Compliance

    The FAA estimates that this AD affects 117 helicopters of U.S.
Registry. Labor rates are estimated at $85 per work-hour. Based on
these numbers, the FAA estimates the following costs to comply with
this AD.
    Inspecting an M/R pitch link rod end assembly will take about 1
work-hour for an estimated cost of $85 per helicopter and up to $9,945
for the U.S. fleet. Re-identifying an M/R pitch link upper rod end
assembly will take a minimal amount of time with a nominal parts cost.
Replacing an M/R pitch link rod end assembly will take about 2 work-
hours and parts will cost about $5,698, for an estimated cost of $5,868
per helicopter.

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. Subtitle I, section 106, describes the
authority of the FAA Administrator. Subtitle VII, Aviation Programs,
describes in more detail the scope of the Agency's authority.
    The FAA is issuing this rulemaking under the authority described in
Subtitle VII, Part A, Subpart III, Section 44701: General requirements.
Under that section, Congress charges the FAA with promoting safe flight
of civil aircraft in air commerce by prescribing regulations for
practices, methods, and procedures the Administrator finds necessary
for safety in air commerce. This regulation is within the scope of that
authority because it addresses an unsafe condition that is likely to
exist or develop on products identified in this rulemaking action.

Regulatory Findings

    This AD will not have federalism implications under Executive Order
13132. This AD will not have a substantial direct effect on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government.
    For the reasons discussed above, I certify that this AD:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866, and
    (2) Will not affect intrastate aviation in Alaska.

List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by
reference, Safety.

The Amendment

    Accordingly, under the authority delegated to me by the
Administrator, the FAA amends 14 CFR part 39 as follows:

PART 39--AIRWORTHINESS DIRECTIVES

0
1. The authority citation for part 39 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 44701.

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive:

2023-10-05 Leonardo S.p.a.: Amendment 39-22441; Docket No. FAA-2023-
1049; Project Identifier AD-2023-00591-R.

(a) Effective Date

    This airworthiness directive (AD) is effective June 7, 2023.

(b) Affected ADs

    This AD replaces Emergency AD 2023-07-51, Project Identifier
MCAI-2023-00551-R, issued on March 31, 2023.

(c) Applicability

    This AD applies to all Leonardo S.p.a. Model AB139 and AW139
helicopters, certificated in any category.

(d) Subject

    Joint Aircraft System Component (JASC) Code: 6200, Main Rotor
System.

(e) Unsafe Condition

    This AD was prompted by a report of excessive play of the
bearing installed in a main rotor (M/R) pitch link upper rod end
assembly. The FAA is issuing this AD to detect incorrect
installation of the bearing. The unsafe condition, if not addressed,
could result in a crack in the M/R pitch link upper rod end
assembly, failure of the M/R pitch link upper rod end assembly, and
subsequent loss of control of the helicopter.

(f) Compliance

    Comply with this AD within the compliance times specified,
unless already done.

(g) Requirements

    Except as specified in paragraphs (h) and (i) of this AD: Comply
with all required actions and compliance times specified in, and in
accordance with, European Union Aviation Safety Agency Emergency AD
2023-0071-E, dated March 31, 2023 (EASA AD 2023-0071-E).

(h) Exceptions to EASA AD 2023-0071-E

    (1) Where EASA AD 2023-0071-E refers to its effective date, this
AD requires using the effective date of this AD.
    (2) Where EASA AD 2023-0071-E requires compliance in terms of
flight hours, this AD requires using hours time-in-service.
    (3) Where paragraph (1) of EASA AD 2023-0071-E states, ``before
next flight;'' for this AD, replace that text with, ``within four
calendar days.''
    (4) Where paragraph (1) of EASA AD 2023-0071-E requires a
dimensional check, this AD requires an inspection for a gap.
    (5) Instead of complying with paragraph (2) of EASA AD 2023-
0071-E, comply with the following: ``As a result of the inspection
required by paragraph (1) of EASA AD 2023-0071-E, for this AD, if
there is any gap that measures 0.5 mm or more between the M/R pitch
link upper rod end assembly bearing and the pitch control lever
assembly on either side, before further flight, remove the affected
part, as defined in EASA AD 2023-0071-E, from service and replace it
with a serviceable part, as defined in EASA AD 2023-0071-E.''
    (6) Where paragraph (3) of EASA AD 2023-0071-E states, ``Within
25 flight hours, or at the next removal of an affected part,
whichever occurs first;'' for this AD, replace that text with,
``Within 25 hours time-in-service.''

    (7) This AD does not adopt the ``Remarks'' section of EASA AD
2023-0071-E.

(i) No Reporting Requirement

    Although the service information referenced in EASA AD 2023-
0071-E specifies to submit certain information to the manufacturer,
this AD does not include that requirement.

(j) Special Flight Permits

    Special flight permits are prohibited.

(k) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, International Validation Branch, FAA, has the
authority to approve AMOCs for this AD, if requested using the
procedures found in Sec.  39.19. In accordance with Sec.  39.19,
send your request to your principal inspector or local Flight
Standards District Office, as appropriate. If sending information
directly to the manager of the certification office, send it to the
attention of the person identified in paragraph (l) of this AD. If
sending information directly to the manager of the International
Validation Branch, mail it to the address identified in paragraph
(l) of this AD or email to: [email protected]. If mailing
information, also submit information by email.
    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.

(l) Additional Information

    For more information about this AD, contact Dan McCully, Program
Manager, International Validation Branch, FAA, 1600 Stewart Ave.,
Suite 410, Westbury, NY 11590; telephone<PHONE_NUMBER>; email
[email protected].

(m) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference of the service information listed in this
paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless the AD specifies otherwise.
    (i) European Union Aviation Safety Agency (EASA) Emergency AD
2023-0071-E, dated March 31, 2023.
    (ii) [Reserved]
    (3) For EASA AD 2023-0071-E, contact EASA, Konrad-Adenauer-Ufer
3, 50668 Cologne, Germany; telephone +49 221 8999 000; email
[email protected]; internet easa.europa.eu. You may find the EASA
material on the EASA website at ad.easa.europa.eu.
    (4) You may view this service information at the FAA, Office of
the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room
6N-321, Fort Worth, TX 76177. For information on the availability of
this material at the FAA, call<PHONE_NUMBER>.
    (5) You may view this service information that is incorporated
by reference at the National Archives and Records Administration
(NARA). For information on the availability of this material at
NARA, email: [email protected], or go to: www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued on May 17, 2023.
Michael Linegang,
Acting Director, Compliance & Airworthiness Division, Aircraft
Certification Service.
[FR Doc. 2023-10996 Filed 5-19-23; 11:15 am]
BILLING CODE 4910-13-P


[Federal Register Volume 79, Number 132 (Thursday, July 10, 2014)]
[Notices]
[Pages 39425-39429]
[FR Doc No: 2014-16095]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-72536; File No. SR-NYSEMKT-2014-21]

Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of
Amendment No. 1 and Order Granting Accelerated Approval of Proposed
Rule Change, as Modified by Amendment No. 1, To Make Permanent Its
Pilot Program Regarding Minimum Value Sizes for Opening Transactions in
New Series of Flexible Exchange Options and Establish New Minimum Value
Sizes Applicable to Other FLEX Transactions and FLEX Quotes

July 3, 2014.

I. Introduction

    On March 18, 2014, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'')
filed with the Securities and Exchange Commission (``Commission''),
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to
make permanent its pilot program regarding minimum value sizes for
opening transactions in new series of flexible exchange options (``FLEX
Options'' or ``FLEX'') and establish new minimum value sizes applicable
to

other FLEX transactions and FLEX Quotes. The proposed rule change was
published for comment in the Federal Register on April 7, 2014.\3\ The
Commission received no comments on the proposal. The Exchange consented
to an extension of the time period for the Commission to approve the
proposed rule change, disapprove the proposed rule change, or institute
proceedings to determine whether the proposed rule change should be
disapproved, to July 6, 2014. The Exchange filed Amendment No. 1 to the
proposed rule change on May 22, 2014, in order to transmit a revised
pilot report that replaces the original Exhibit 3 to the filing.\4\ The
Commission is publishing this notice to solicit comments on Amendment
No. 1 from interested persons and is approving the proposed rule
change, as modified by Amendment No. 1, on an accelerated basis.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 71840 (April 1,
2014), 79 FR 19162 (``Notice'').
    \4\ The Exchange attached an Exhibit 3 to its proposed rule
change that contained an annual report summarizing pilot data
collected for the year 2013, the most recent complete year of the
pilot program (``Pilot Report''). Specifically, the Pilot Report
summarizes the trading volume and underlying value of opening
transactions in new series of FLEX Options during the year 2013 with
a size below the minimum value thresholds in force before the pilot,
as well as the types of customers initiating such transactions. In
Amendment No. 1, the Exchange submitted a revised Pilot Report as a
new Exhibit 3 that replaces the original Exhibit 3 in its entirety.
The revised Pilot Report corrects errors in the total FLEX Equity
Option contract trading volume under the pilot, total FLEX Index
Option contract trading volume under the pilot, and total number of
FLEX Index Option trades under the pilot reported in the original
Pilot Report. The revised Pilot Report also makes corresponding
adjustments to other figures reported in the Pilot Report, as well
as non-substantive changes to certain descriptive language in the
Pilot Report.
---------------------------------------------------------------------------

II. Description of the Amended Proposal

    FLEX Options, unlike traditional standardized options, allow
investors to customize basic option terms, including size, expiration
date, exercise style, and certain exercise prices.\5\ Pursuant to
Commentary .01 to Rule 903G, the Exchange currently has in place a
pilot program under which the minimum size requirements set forth in
Rule 903G(a)(4)(ii), which apply to opening transactions in new series
of FLEX Options, are replaced with a one-contract minimum size (``Pilot
Program'').\6\ Prior to the Pilot Program, pursuant to Rule
903G(a)(4)(ii), the minimum value size for an opening transaction in
any FLEX series in which there was no open interest at the time the
request for quotes was submitted was: (i) For FLEX Equity Options, the
lesser of 250 contracts or the number of contracts overlying $1 million
in the underlying securities; and (ii) for FLEX Index Options, $10
million Underlying Equivalent Value in the case of Broad Stock Index
Group FLEX Index Options and $5 million Underlying Equivalent Value in
the case of Stock Index Industry Group FLEX Index Options.\7\ The
Exchange's proposal will make the Pilot Program permanent by
eliminating the minimum value size requirements set forth in Rule
903G(a)(4)(ii) for opening transactions in new FLEX Option series and
by eliminating the Pilot Program rule text set forth in Commentary .01
to Rule 903G. In connection with its proposal to make the Pilot Program
permanent, and as required by its filing establishing the Pilot
Program,\8\ the Exchange submitted to the Commission an annual Pilot
Report summarizing Pilot Program data collected for year 2013, the most
recent complete year of the Pilot Program.\9\
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    \5\ See Notice, 79 FR at 19162 n.4; see also NYSE MKT Options
Rule (``Rule'') 903G. FLEX Options can be FLEX Index Options or FLEX
Equity Options. See Rules 900G(b)(10) and (b)(11) (defining,
respectively, the terms ``FLEX Equity Option'' and ``FLEX Index
Option'').
    \6\ See Commentary .01 to Rule 903G; see also Securities
Exchange Act Release No. 62084 (May 12, 2010), 75 FR 28091 (May 19,
2010) (SR-NYSEAmex-2010-40) (establishing Pilot Program); and 71844
(April 1, 2014), 79 FR 19160 (April 7, 2014) (SR-NYSEMKT-2014-26)
(extending Pilot Program until the earlier of July 31, 2014 or
approval of the Pilot Program on a permanent basis).
    \7\ See Rule 903G(a)(4)(ii); see also Rule 900G(b)(9) (defining
the term ``Underlying Equivalent Value'').
    \8\ See supra note 6.
    \9\ Specifically, the Pilot Report contains data and analysis of
underlying equivalent values, open interest and trading volume, and
analysis of the types of investors that initiated opening FLEX
Equity and Index Options transactions (i.e., institutional, high net
worth, or retail) in new FLEX Option series. See Amendment No. 1,
supra note 4.
---------------------------------------------------------------------------

    In its filing, the Exchange also has proposed to make some other
changes to its FLEX Option minimum value size rules, in addition to
requesting that the Pilot Program be made permanent. Rules
903G(a)(4)(iii)-(iv), which are not part of the Pilot Program, set
forth minimum value sizes for other FLEX Option transactions and for
FLEX Quotes. Specifically, pursuant to Rule 903G(a)(4)(iii), for a
transaction in any currently-opened FLEX series, the minimum value size
is: (i) For FLEX Equity Options, the lesser of 100 contracts or the
number of contracts overlying $1 million in the underlying securities
in the case of opening transactions, and 25 contracts in the case of
closing transactions; and (ii) for FLEX Index Options, $1 million
Underlying Equivalent Value in the case of both opening and closing
transactions; or (iii) for either case, the remaining underlying size
or Underlying Equivalent Value on a closing transaction, whichever is
less. Pursuant to Rule 903G(a)(4)(iv), the minimum value size for FLEX
Quotes responsive to a Request for Quotes is 25 contracts in the case
of FLEX Equity Options and $1 million Underlying Equivalent Value in
the case of FLEX Index Options or for either case the remaining
underlying size or Underlying Equivalent Value on a closing
transaction, whichever is less. Even though these minimum value size
requirements set forth in Rules 903G(a)(4)(iii)-(iv) are not part of
the Pilot Program, the Exchange has proposed to eliminate them as well,
in conjunction with making the Pilot Program permanent. In its proposal
the Exchange noted that adopting the same minimum value sizes for
existing and new series, in addition to quotes, will allow market
participants to tailor their FLEX Option transactions to meet their
investment objectives.
    By proposing to make permanent the Pilot Program one-contract
minimum for opening transactions in new series of FLEX Options and by
also proposing to eliminate the minimum value size requirements for
FLEX Option transactions in currently-opened series and FLEX Quotes
responsive to a Request for Quotes, the Exchange is seeking to
establish a one-contract minimum size for all FLEX Option transactions
and FLEX Quotes. This one-contract minimum size would be codified in
new Rule 903G(a)(2)(vii). The Exchange states that its proposal for a
one-contract minimum value size for all FLEX Option transactions and
FLEX Quotes is based on similar rules governing minimum value size for
FLEX Options approved for the CBOE.\10\
---------------------------------------------------------------------------

    \10\ See Notice, 79 FR at 19164 and n.15 (citing Securities
Exchange Act Release No. 67624 (August 8, 2012), 77 FR 48580 (August
14, 2012) (order approving CBOE's proposal to make permanent its
pilot program eliminating minimum value sizes for FLEX Options)).
---------------------------------------------------------------------------

    In addition, as a technical, non-substantive change, the Exchange
has proposed to relocate from current Rule 903G(a)(4)(i) to new Rule
903G(a)(2)(vi) rule text stating that the maximum term for both Equity
and Index FLEX Options shall be fifteen years, and make other non-
substantive changes to the rule.

III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule
change, as amended, is consistent with the requirements of the Act and
the rules and regulations thereunder applicable to

a national securities exchange.\11\ In particular, the Commission finds
that the proposed rule change is consistent with Section 6(b)(5) of the
Act,\12\ which requires, among other things, that the rules of a
national securities exchange be designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest; and not be designed to
permit unfair discrimination between customers, issuers, brokers or
dealers.
---------------------------------------------------------------------------

    \11\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
    \12\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    FLEX Options were originally designed for use by institutional and
high net worth customers, rather than retail investors.\13\ In
approving CBOE's pilot eliminating minimum value sizes for FLEX
Options, which was the first such pilot to go into effect, the
Commission noted that it had received several comment letters stating
that the proposal would assist institutional customers, but it also
noted that the elimination of the minimum value size requirements
raised the possibility that retail customers would access the FLEX
Options market.\14\ One of the risks to retail investors outlined in
the ODD \15\ is that, because of the customized nature of FLEX Options
and lack of continuous quotes, trading in FLEX Options is often less
deep and liquid than trading in standardized options on the same
underlying interest.\16\ Additionally, the Commission observed that
reducing the minimum value size for opening FLEX Option transactions
increases the potential for the FLEX Options market to act as a
surrogate for the standardized options market, and expressed concern in
this regard because the standardized market contains certain
protections for investors not present in the FLEX Options market.\17\
The Commission stated that, in the event CBOE proposed making its pilot
program permanent, information regarding the types of customers
initiating opening FLEX Options transactions during the pilot would
enable the Commission to evaluate how market participants have
responded to CBOE's pilot program and what types of customers are using
the FLEX Options market.\18\ For these same reasons, at the
Commission's request, the Exchange included in its Pilot Report
information regarding the types of customers that initiated opening
FLEX Option transactions under its Pilot Program.\19\
---------------------------------------------------------------------------

    \13\ See Notice, 79 FR at 19163; see also Securities Exchange
Act Release No. 37336 (June 19, 1996), 61 FR 33558 (June 27, 1996)
(order approving SR-Amex-95-57). As noted in the Options Disclosure
Document (``ODD''), which explains the characteristics and risks of
exchange-traded options, flexibly structured options may be useful
to sophisticated investors seeking to manage particular portfolio
and trading risks. Rule 9b-1 under the Act requires that broker-
dealers furnish the ODD to a customer before accepting an order from
the customer to purchase or sell an option contract relating to an
options class that is the subject of the ODD, or approving the
customer's account for the trading of such option. See 17 CFR
240.9b-1(d).
    \14\ See Securities Exchange Act Release No. 61439 (January 28,
2010), 75 FR 5831 (February 4, 2010) (order approving SR-CBOE-2009-
087) (``CBOE Pilot Approval Order'').
    \15\ See supra note 13.
    \16\ In particular, the ODD states that because many of the
terms of FLEX Options are not standardized, it is less likely that
there will be an active secondary market in which holders and
writers of such options will be able to close out their positions by
offsetting sales and purchases. Also, the ODD states that certain
margin requirements for positions in flexibly structured options may
be significantly greater than the margin requirements applicable to
similar positions in other options on the same underlying interest.
    \17\ See CBOE Pilot Approval Order, supra note 14. In
particular, the Commission noted that continuous quotes may not
always be available in the FLEX Options market and that FLEX Options
do not have trading rotations at either the opening or closing of
trading. Id.
    \18\ Id. The Exchange has submitted a Pilot Report to the
Commission as Exhibit 3 to its filing, as well as other,
confidential reports of data collected during the Pilot Program. See
Amendment No. 1, supra note 4.
    \19\ See Amendment No. 1, supra note 4.
---------------------------------------------------------------------------

    The Commission believes that these considerations and concerns that
informed its analysis of whether to permanently approve CBOE's pilot
are equally germane to its analysis here. As such, the Commission has
carefully reviewed the Pilot Report that the Exchange provided to the
Commission.\20\ The Pilot Report reflects that, in 2013, 315 opening
transactions in new series of FLEX Equity Options were initiated on the
Exchange with small minimum value sizes made possible by the Pilot
Program, 286 of which were initiated by retail customers, 25 of which
were initiated by institutional customers, and 4 of which were
initiated by high net worth customers.\21\ Moreover, the Pilot Report
indicates that these 315 FLEX Equity Option transactions covered by the
Pilot Program accounted for approximately 3% of the total volume and
approximately 5% of the total value of all opening FLEX Equity Option
transactions in new series--i.e., opening transactions covered by the
Pilot Program as well as opening transactions with value sizes above
the pre-pilot minimum--during 2013.
---------------------------------------------------------------------------

    \20\ Id.
    \21\ Id. The Pilot Report indicates that there were no opening
transactions in new series of FLEX Index Options during 2013 that
were initiated below the pre-pilot minimum size requirement.
---------------------------------------------------------------------------

    The Exchange notes that the Pilot Report includes data specific to
opening transactions in new series of FLEX Options pursuant to current
Rule 903G(a)(4)(ii), and does not include data for transactions in
currently-opened FLEX Options series or FLEX Quotes responsive to a
request for quotes pursuant to Rules 903G(a)(4)(iii)-(iv), as such
transactions and FLEX Quotes were not part of the Pilot Program.\22\
The Exchange represents, however, that based on its internal review, if
Rules 903G(a)(4)(iii)-(iv) had been part of the Pilot Program,
transactions in currently-opened FLEX Options series or FLEX Quotes
with small value sizes made permissible by the Pilot Program would have
been de minimis, and would not have materially altered the data in the
Pilot Report.\23\
---------------------------------------------------------------------------

    \22\ See Notice, 79 FR at 19164.
    \23\ Id.
---------------------------------------------------------------------------

    On balance, the Commission believes that it is consistent with the
Act to make the Pilot Program permanent and thus eliminate, on a
permanent basis, the minimum value size requirements set forth in Rule
903G(a)(4)(ii) for opening transactions in new series of FLEX Options.
The protections noted below, including heightened options suitability
requirements, should help to address any concerns about retail
participation in the Exchange's FLEX Options market. Moreover, the
Commission is not aware of any data or analysis to date suggesting that
the trading of FLEX Options has acted as a surrogate for the trading of
standardized options on the Exchange as a result of the Pilot Program.
Indeed, the Commission understands that FLEX Option trading accounts
for less than 1% of the combined trading volume of the standardized and
FLEX Option markets.\24\ In addition, the Pilot Report indicates that
Pilot Program FLEX Option trades account for a very small proportion of
the total volume and total value of all FLEX Option trades. Thus, it
appears that the Pilot Program has not caused significant trading
interest to migrate from the standardized options market to the FLEX
Options market, nor caused, to the best of our knowledge, a

large number of investors to use FLEX Options to avoid certain
requirements in the standardized market. Based on the current data and
size of the FLEX Options market, and the lack of any evidence to the
contrary, it would appear that investors are using the FLEX Options
market for its intended purpose--to be able to customize certain terms
not available in the standardized options market.
---------------------------------------------------------------------------

    \24\ See email dated June 19, 2014 from Glenn H. Gsell, Managing
Director, Intercontinental Exchange, NYSE Regulation, Inc. to
Michael Bradley and David Michehl, Special Counsels, Division of
Trading and Markets, Commission.
---------------------------------------------------------------------------

    The Commission also believes that a logical corollary to making the
Pilot Program permanent is to eliminate the minimum value size
requirements set forth in Rules 903G(a)(4)(iii)-(iv) for transactions
in currently-opened FLEX Options series and FLEX Quotes responsive to a
request for quotes. In this regard, the Commission notes that the
Exchange does not believe that the difference between effecting a
transaction in an existing FLEX Option series and effecting a FLEX
transaction in a new series is material to the extent that there should
be different minimum value sizes for the two types of transactions.\25\
In addition, the Exchange believes it would be consistent to apply the
same minimum value size to closing transactions so that investors may
elect to close just a portion of their FLEX position, without being
subject to a minimum value size that may be greater than the equivalent
value size necessary to meet their investment objectives.\26\ Further,
the Exchange believes that it would be consistent to apply the same
minimum value size to FLEX Quotes so that market participants may
respond to a request for quotes with the precise number of contracts or
underlying equivalent value needed to trade with the OTP Holder that
submitted the request. The Commission finds no basis under the Act at
this time for maintaining a minimum value size requirement for
transactions in currently-opened FLEX Option series or FLEX Quotes
responsive to a request for quotes, and believes that these changes
should be approved for reasons similar to those supporting permanent
approval of the Pilot Program. The Commission notes that it is not
aware of any problems resulting from the permanent approval of CBOE's
pilot eliminating FLEX Option minimum value sizes, which included
currently-opened series and FLEX Quotes responsive to a request for
quotes. As a result, the Commission believes that it is appropriate
under the Act, and would promote just and equitable principles of
trade, as well as remove impediments to and perfect the mechanism of a
free and open market and a national market system, to replace the
current minimum value size requirements for all FLEX Option
transactions and FLEX Quotes on the Exchange with a one-contract
minimum size.
---------------------------------------------------------------------------

    \25\ See Notice, 79 FR at 19164.
    \26\ Id. Currently, the minimum value size for closing
transactions is 25 contracts in the case of FLEX Equity Options and
$1 million Underlying Equivalent Value in the case of FLEX Index
Options, or in either case the remaining underlying size or
Underlying Equivalent Value on a closing transaction, whichever is
less. See Rules 903G(a)(4)(iii)-(iv).
---------------------------------------------------------------------------

    Existing safeguards--such as position reporting requirements and
margin requirements--will continue to apply to FLEX Options.\27\
Further, as noted above, under Rule 9b-1 under the Act,\28\ all
customers of a broker-dealer with options accounts approved to trade
FLEX Options must receive the ODD, which contains specific disclosures
about the characteristics and special risks of trading FLEX
Options.\29\ In addition, similar to other options, FLEX Options are
subject to Trading Permit Holder supervision and suitability
requirements, such as in Rules 922 and 923, respectively.\30\ In
addition to ensuring that FLEX Options are suitable for their
customers, broker-dealers also must take into account the
characteristics of the FLEX market, as compared to the standardized
market, when satisfying their best execution obligations. The
Commission believes that the safeguards in place are reasonably
designed to help mitigate potential risks for retail investors and
other market participants investing in FLEX Options.
---------------------------------------------------------------------------

    \27\ Certain position limit, aggregation and exercise limit
requirements continue to apply to FLEX Options in accordance with
Rule 906G (Position Limits) and Rule 907G (Exercise Limits). But the
Commission notes that certain FLEX Options do not have position or
exercise limits.
    \28\ 17 CFR 240.9b-1.
    \29\ See supra notes 13 and 16.
    \30\ See Notice, 79 FR at 19163.
---------------------------------------------------------------------------

    The Exchange believes that permanently removing the minimum value
size requirements for FLEX Options will give investors a more viable,
exchange-traded alternative to customized options in the OTC market,
which are not subject to minimum value size requirements.\31\
Furthermore, the Exchange has represented that broker-dealers have
indicated to the Exchange that the minimum value size requirements have
prevented them from bringing transactions on the Exchange that are
already taking place in the OTC market.\32\ Therefore, it appears
possible that eliminating the minimum value sizes for all FLEX Options
transactions and FLEX Quotes could further incent trading interest in
customized options to move from the OTC market to the Exchange. To the
extent investors choose to trade FLEX Options on the Exchange in lieu
of the OTC market as a result of the permanent removal of the minimum
value size requirements, such action should benefit investors. As the
Commission has previously noted, there are certain benefits to trading
on an exchange, such as enhanced efficiency in initiating and closing
out positions, increased market transparency, and heightened contra-
party creditworthiness due to the role of the Options Clearing
Corporation as issuer and guarantor of FLEX Options.\33\
---------------------------------------------------------------------------

    \31\ Id.
    \32\ Id.
    \33\ See Securities Exchange Act Release No. 57429 (March 4,
2008), 73 FR 13058 (March 11, 2008) (order approving SR-CBOE-2006-
36).
---------------------------------------------------------------------------

IV. Solicitation of Comments on Amendment No. 1

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether Amendment No. 1
to the proposed rule change is consistent with the Act. Comments may be
submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEMKT-2014-21 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEMKT-2014-21. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and

printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSEMKT-2014-21 and should
be submitted on or before July 31, 2014.

V. Accelerated Approval of Proposal, as Modified by Amendment No. 1

    In Amendment No. 1, the Exchange submitted a revised Pilot Report
that corrects errors in the total FLEX Equity Option contract trading
volume under the pilot, total FLEX Index Option contract trading volume
under the pilot, and total number of FLEX Index Option trades under the
pilot reported in the original Pilot Report. The revised Pilot Report
also makes corresponding adjustments to other figures reported in the
Pilot Report, as well non-substantive changes to certain descriptive
language in the Pilot Report. The Commission believes that these
corrections to the Pilot Report do not substantively alter the findings
in the Pilot Report or diminish their support for approval of the pilot
on a permanent basis. Accordingly, the Commission also finds good
cause, pursuant to Section 19(b)(2) of the Act,\34\ for approving the
proposed rule change, as modified by Amendment No. 1, prior to the
thirtieth day after the date of publication of notice in the Federal
Register.
---------------------------------------------------------------------------

    \34\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

VI. Conclusion

    In summary, the Commission believes, for the reasons noted above,
that the proposed rule change to permanently approve the Pilot Program
as well as remove the minimum size requirements for currently-opened
FLEX Option series and FLEX Quotes, thereby permanently removing the
minimum size requirements for all FLEX Options on the Exchange, is
consistent with the Act and Section 6(b)(5) thereunder in particular,
and should be approved, as amended. The Exchange has committed, and the
Commission expects the Exchange, to continue to monitor the usage of
FLEX Options, whether changes need to be made to its rules or the ODD
to address any changes in retail FLEX Option participation, and for any
other issues that may occur as a result of the elimination of the
minimum value sizes on a permanent basis, including whether FLEX Option
trades are being used as a surrogate for trading options in the
standardized market.\35\
---------------------------------------------------------------------------

    \35\ See Notice, 79 FR at 19164 (Exchange representing that it
will continue to monitor the usage of FLEX Options and whether any
changes to its rules or the ODD are necessary).
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\36\ that the proposed rule change (SR-NYSEMKT-2014-21) be, and it
hereby is, approved, on an accelerated basis, as amended.
---------------------------------------------------------------------------

    \36\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\37\
---------------------------------------------------------------------------

    \37\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2014-16095 Filed 7-9-14; 8:45 am]
BILLING CODE 8011-01-P