[Federal Register Volume 77, Number 55 (Wednesday, March 21, 2012)]
[Rules and Regulations]
[Pages 16471-16472]
[FR Doc No: 2012-6860]

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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Parts 191, 192, 193 and 195

[Docket No. PHMSA-2012-0001]

Pipeline Safety: Implementation of the National Registry of
Pipeline and Liquefied Natural Gas Operators

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA),
DOT.

ACTION: Issuance of Advisory Bulletin.

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SUMMARY: This notice advises owners and operators of pipeline
facilities of PHMSA's plan for implementing the national registry of
pipeline and liquefied natural gas operators. This notice provides
updates to the information contained in a PHMSA Advisory Bulletin
published on January 13, 2012 (77 FR 2126).

FOR FURTHER INFORMATION CONTACT: Jamerson Pender, Information Resources
Manager,<PHONE_NUMBER> or by email at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background

    On November 26, 2010, PHMSA published a final rule in the Federal
Register (75 FR 72878) titled: ``Pipeline Safety: Updates to Pipeline
and Liquefied Natural Gas Reporting Requirements.'' That final rule
added two new sections, 49 CFR 191.22 and 195.64, to the pipeline
safety regulations that concerned the establishment of a national
registry of pipeline and liquefied natural gas (LNG) operators. New
operators use the national registry to obtain an Operator
Identification (OPID) Number and existing operators use it to notify
PHMSA of certain actions, including company name changes, certain
construction activities, and project planning.
    The national pipeline operator registry became effective on January
1, 2012. In compliance with the Paperwork Reduction Act requirements,
PHMSA issued a 60-day Federal Register notice on December 13, 2010 (75
FR 77694), and a 30-day Federal Register notice on

November 10, 2011 (76 FR 70217). The purpose of these notices was to
gather and respond to comments on the actual forms used to collect
information for the national pipeline operator registry.
    PHMSA is issuing this advisory bulletin to clarify the
implementation of the national pipeline operator registry.

II. Advisory Bulletin (ADB-2012-04)

    To: Owners and Operators of Pipeline and LNG Facilities.
    Subject: Implementation of the National Registry of Pipeline and
LNG Operators.
    Advisory: This notice advises owners and operators of pipeline
facilities of PHMSA's plan for implementing the national registry of
pipeline and LNG operators. This notice provides updates to the
information contained in a PHMSA Advisory Bulletin on the same subject
published on January 13, 2012 (77 FR 2126).

OPID Assignment Requests--Sec. Sec.  191.22(a) and 195.64(a)

    From January 1, 2012, to January 27, 2012, PHMSA collected fillable
pdf versions of OPID Assignment Request (Form F 1000.1). Starting
January 27, 2012, the Online Data Reporting System (ODES) is used by
entities requesting a new OPID. PHMSA is entering the pdf versions of
OPID Assignment Request forms into ODES and will notify requestors when
the OPID has been established.
    While subject to the pipeline safety regulations, operators of
master meter systems or petroleum gas systems that serve fewer than 100
customers from a single source are not required to file annual reports
(see 49 CFR 191.11(b)). There were several thousand master meter system
operators and several hundred small liquefied petroleum gas (LPG)
operators who fell within the scope of this exception as of December
31, 2011.
    While also subject to the requirements of 49 CFR 191.22, PHMSA
previously determined that the operators of these systems would not be
required to obtain an OPID. Instead, PHMSA agreed to create OPIDs for
these operators based on the existing data in the agency's files. That
is currently underway and will be completed by May 1, 2012.
    In light of this experience, PHMSA has decided that master meter
and small LPG operators established after December 31, 2011, will be
required to obtain an OPID in accordance with 49 CFR 191.22. On May 1,
2012, PHMSA will modify ODES to allow these master meter and small LPG
operators to request an OPID. The requirement to request an OPID
continues to not apply to master meter and small LPG operators in
existence prior to December 31, 2011.

Notifications--Sec. Sec.  191.22(c) and 195.64(c)

    On January 1, 2012, PHMSA began collecting fillable pdf versions of
Notifications (Form F 1000.2). Starting March 27, 2012, operators will
be able to submit notifications online through ODES, and PHMSA will
enter all of the pdf versions of the notifications into ODES shortly
thereafter.
    Hazardous liquid pipeline operators are advised to disregard the
notification requirement in Sec.  195.64(c)(1)(iii). That provision
requires notification for construction of any new pipeline facility
without regard to cost. Section 195.64(c)(1)(i) also requires
notification for construction of a new pipeline facility, but only for
those projects with a cost of $10 million or more. PHMSA only wants
notification of hazardous liquid pipeline facility construction
projects with a cost of $10 million or more and plans to remove Sec.
195.64(c)(1)(iii) in a future rulemaking.

OPID Validation--Sec. Sec.  191.22(b) and 195.64(b)

    On March 27, 2012, operators will be able to complete the
validation process online. PHMSA requests that all OPIDs issued prior
to January 1, 2012, complete the validation process. As with OPID
Assignment Requests, master meter and small LPG operators in existence
prior to December 31, 2011, are not required to complete the validation
process. Based on the delayed availability of the on-line validation
process, PHMSA is extending the regulatory deadline for validation from
June 30, 2012, to September 30, 2012. PHMSA recommends that operators
submit calendar year 2011 annual reports at least five working days
prior to completing the validation process.
    Further details on how to submit reports to PHMSA are available at
http://opsweb.phmsa.dot.gov. Questions should be directed to the Office
of Pipeline Safety operator helpline at<PHONE_NUMBER>.

    Issued in Washington, DC, on March 9, 2012.
Jeffrey D. Wiese,
Associate Administrator for Pipeline Safety.
[FR Doc. 2012-6860 Filed 3-20-12; 8:45 am]
BILLING CODE 4910-60-P


[Federal Register Volume 86, Number 132 (Wednesday, July 14, 2021)]
[Notices]
[Pages 37143-37144]
[FR Doc No: 2021-14944]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 2629-014]

Village of Morrisville, Vermont; Notice of Conference Call

    a. Date and Time of Meeting: August 25, 2021 at 10:00 a.m. Eastern
Time.
    b. FERC Contact: Steve Kartalia at<EMAIL_ADDRESS>or
(202) 502-6131.
    c. Purpose of Meeting: On May 24, 2021, in a filing labeled
privileged, the Village of Morrisville (Morrisville) requested a
meeting with Commission staff to receive guidance on its pending
application to relicense the Morrisville Hydroelectric Project No.
2629, including potential amendments to the license application or the
current license. The conference call will provide Morrisville with the
opportunity to discuss potential amendments with Commission staff.
    d. Proposed Agenda: (1) Introduction of participants; (2)
Commission staff explains purpose of the meeting; (3) Morrisville
discusses its potential amendments and seeks guidance from Commission
staff; (4) Meeting participants discuss questions and topics raised by
Morrisville; and (5) Commission staff concludes the meeting.
    e. A summary of the meeting will be prepared and filed in the
Commission's public file for the project.

    f. All local, state, and federal agencies, Indian tribes, and other
interested parties are invited to participate by phone. If interested,
please contact Steve Kartalia at<EMAIL_ADDRESS>or (202)
502-6131, by August 23, 2021, to receive a link and invitation to the
conference call.

    Dated: July 8, 2021.
Kimberly D. Bose,
Secretary.
[FR Doc. 2021-14944 Filed 7-13-21; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 81, Number 117 (Friday, June 17, 2016)]
[Notices]
[Pages 39748-39749]
[FR Doc No: 2016-14322]

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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

[Docket Number FRA-2002-12268]

Petition for Waiver of Compliance

    In accordance with part 211 of Title 49 Code of Federal Regulations
(CFR), this document provides the public notice that by a document
dated May 13, 2016, the Plymouth & Lincoln Railroad (PLL) has
petitioned the Federal Railroad Administration (FRA) for a waiver of
compliance from certain provisions of the Federal railroad safety
regulations contained at 49 CFR part 219. FRA assigned the petition
Docket Number FRA-2002-12268.
    PLL requests an extension of an existing waiver providing relief
from 49 CFR part 219, subparts D (Testing for Cause), E (Identification
of Troubled Employees), F (Pre-Employment Tests), and G (Random Alcohol
and Drug Testing Programs).
    A copy of the petition, as well as any written communications
concerning the petition, is available for review online at
www.regulations.gov and in person at the Department of Transportation's
Docket Operations Facility, 1200 New Jersey Avenue SE., W12-140,
Washington, DC 20590. The Docket Operations Facility is open from 9
a.m. to 5 p.m., Monday through Friday, except Federal Holidays.
    Interested parties are invited to participate in these proceedings
by submitting written views, data, or comments. FRA does not anticipate
scheduling a public hearing in connection with these proceedings since
the facts do not appear to warrant a hearing. If any interested party
desires an opportunity for oral comment and a public hearing, they
should notify FRA, in writing, before the end of the comment period and
specify the basis for their request.
    All communications concerning these proceedings should identify the
appropriate docket number and may be submitted by any of the following
methods:
     Web site: http://www.regulations.gov. Follow the online
instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: Docket Operations Facility, U.S. Department of
Transportation, 1200 New Jersey Avenue SE., W12-140, Washington, DC
20590.
     Hand Delivery: 1200 New Jersey Avenue SE., Room W12-140,
Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal Holidays.

    Communications received by August 1, 2016 will be considered by FRA
before final action is taken. Comments received after that date will be
considered as far as practicable.
    Anyone is able to search the electronic form of any written
communications and comments received into any of our dockets by the
name of the individual submitting the comment (or signing the document,
if submitted on behalf of an association, business, labor union, etc.).
In accordance with 5 U.S.C. 553(c), DOT solicits comments from the
public to better inform its processes. DOT posts these comments,
without edit, including any personal information the commenter
provides, to www.regulations.gov, as described in the system of records
notice (DOT/ALL-14 FDMS), which can be reviewed at www.dot.gov/privacy.
See also http://www.regulations.gov/#!privacyNotice for the privacy
notice of regulations.gov.

Robert C. Lauby,
Associate Administrator for Railroad Safety, Chief Safety Officer.
[FR Doc. 2016-14322 Filed 6-16-16; 8:45 am]
 BILLING CODE 4910-06-P


1. $ 16.77 per hour plus 110% overhead = $ 35.22 per hour.

2. One facility subject to performance test each year; EPA witnesses 8% of tests, for average of 0.08 tests per year. 0.08 tests per year at 120 hours per test averages to 9.6 ( or 10 hours) per year witnessing performance tests. TABLE 1: ESTIMATE OF AVERAGE ANNUAL DIRECT PERSONNEL COST TO THE FEDERAL GOVERNMENT Activity EPA Hrs/ Occurrences ( A) Occurrences/ Facility/ Year ( B) EPA Hrs/ Facilities/ Yr ( C) Facilities / Yr ( D) EPA Hrs/ Yr ( E) EPA Cost $ 1 ( F)

1. Review of notification of construction/ reconstruction 2 1 2 1 2 70 2. Review of notification of anticipated startup 2 1 2 1 2 70 3. Review of notification of actual start up 2 1 2 1 2 70 4. Review of design specifications and complete reports 8 1 8 1 8 282 5. Review of notification of initial performance test 2 1 2 1 2 70 6. Review of performance test report 8 1 8 1 8 282 7. Attend performance test 2 120 1 120 0.08 10 352 TABLE 1 ( Continued): ESTIMATE OF AVERAGE ANNUAL DIRECT PERSONNEL COST TO THE FEDERAL GOVERNMENT Activity EPA Hrs/ Occurrence ( A) Occurrences/ Plant/ Year ( B) EPA Hrs/ Facility/ Yr ( C) Facilities / Yr ( D) EPA Hrs/ Yr ( E) EPA Cost $ 1 ( F)

8. Attend performance retests 3 See footer # 3 8 282 9. Review of semiannual reports 8 2 16 160 2,560 90,163 TOTAL: 2,602 91,641 1. $ 16.77 per hour plus 110% overhead = $ 35.22 per hour.

3. Assuming 20% of the 1 facility( s) tested per year fail, an annual average of 0.2 facilities would fail the performance test. 50% of the facilities that fail would require retesting ( 0.1). Retesting preparation requires 16 person hours of Agency time for a notice and a conference ( 1.6 hours per year). If EPA witnesses 0.3 retest every 3 years ( 10% of retest), EPA would witness 0.09 retests per year. At 120 hours per retest EPA would expend an average of 12 person hours witnessing retests; compliance order preparation would require 40 hours for each of the 0.09 test per year, or 3.6 person hours per year; delay in testing for the 10% of the 0.09 tests witnessed by EPA would require 1.2 hours. The total person hours expended for attending performance retests would be 1.6 ( preparation) plus 1.2 ( retesting) plus 3.6 ( preparing orders) plus 1.2 ( witnessing delayed retests) equals 7.6 hours per year ( which is rounded to 8 hours per year).


[Federal Register Volume 80, Number 134 (Tuesday, July 14, 2015)]
[Notices]
[Pages 41046-41047]
[FR Doc No: 2015-17250]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2015-D-2148]

Submission of Premarket Notifications for Magnetic Resonance
Diagnostic Devices; Draft Guidance for Industry and Food and Drug
Administration Staff; Availability

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA) is announcing the
availability of a draft guidance entitled ``Submission of Premarket
Notifications for Magnetic Resonance Diagnostic Devices.'' This draft
guidance provides a detailed description of the information that should
be included in a premarket notification for a magnetic resonance
diagnostic device (MRDD). This draft guidance is not final nor is it in
effect at this time.

DATES: Although you can comment on any guidance at any time (see 21 CFR
10.115(g)(5)), to ensure that the Agency considers your comment of this
draft guidance before it begins work on the final version of the
guidance, submit either electronic or written comments on the draft
guidance by October 13, 2015.

ADDRESSES: An electronic copy of the guidance document is available for
download from the Internet. See the SUPPLEMENTARY INFORMATION section
for information on electronic access to the guidance. Submit written
requests for a single hard copy of the draft guidance document entitled
``Guidance for the Submission of Premarket Notifications for Magnetic
Resonance Diagnostic Devices'' to the Office of the Center Director,
Guidance and Policy Development, Center for Devices and Radiological
Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg.
66, Rm. 5431, Silver Spring, MD 20993-0002. Send one self-addressed
adhesive label to assist that office in processing your request.
    Submit electronic comments on the draft guidance to http://www.regulations.gov. Submit written comments to the Division of Dockets
Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852. Identify comments with the docket number
found in brackets in the heading of this document.

FOR FURTHER INFORMATION CONTACT: Jana Delfino, Center for Devices and
Radiological Health, Food and Drug Administration, 10903 New Hampshire
Ave., Bldg. 66, Rm. 4236, Silver Spring, MD 20993-0002,<PHONE_NUMBER>;
or Sunder Rajan, Center for Devices and Radiological Health, Food and
Drug Administration, 10903 New Hampshire Ave., Bldg. 62, Rm. 1113,
Silver Spring, MD 20993-0002,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    The purpose of this document is to provide a detailed description
of the information that should be included in a premarket notification
for an MRDD. This document is an elaboration of the general
requirements contained in 21 CFR 807.87 and is intended to be used in
conjunction with general information regarding the content and format
of a 510(k) premarket notification. The approach outlined in this
guidance document is intended to facilitate the timely review and
marketing clearance of MRDDs.
    This draft guidance is applicable to MRDDs as defined in 21 CFR
892.1000. An MRDD is intended for general diagnostic use to present
images that reflect the spatial distribution and/or magnetic resonance
spectra that reflect frequency and distribution of nuclei exhibiting
nuclear magnetic resonance. Other physical parameters derived from the
images and/or spectra may also be produced. The device includes
hydrogen-1 (proton) imaging, sodium-23 imaging, hydrogen-1
spectroscopy, phosphorus-31 spectroscopy, and chemical shift imaging
(preserving simultaneous frequency and spatial information). MRDDs are
class II medical devices that require premarket notification and an
agency determination of substantial equivalence prior to marketing.
    The principal components of current MRDDs include the main magnet,
shim and gradient systems, radiofrequency transmitter and receiver,
transmit and receive coils, power supplies, computer, and software.
This draft guidance document is applicable to premarket notifications
for new magnetic resonance imaging (MRI) and magnetic resonance
spectroscopy systems, new components, and modifications to systems and
components that have a significant impact on safety or effectiveness of
the magnetic resonance diagnostic device. The information in this draft
guidance document is also applicable to the MRI system components of
dual-modality devices, such as positron emission tomography/MRI
systems.

II. Significance of Guidance

    This draft guidance is being issued consistent with FDA's good
guidance practices regulation (21 CFR 10.115). The draft guidance, when
finalized, will represent the current thinking of FDA on ``Submission
of Premarket Notifications for Magnetic Resonance Diagnostic Devices.''
It does not establish any rights for any person and is not binding on
FDA or the public. You can use an alternative approach if it satisfies
the requirements of the applicable statutes and regulations.

III. Electronic Access

    Persons interested in obtaining a copy of the draft guidance may do
so by downloading an electronic copy from the Internet. A search
capability for all Center for Devices and Radiological Health guidance
documents is available at http://www.fda.gov/MedicalDevices/DeviceRegulationandGuidance/GuidanceDocuments/default.htm. Guidance
documents are also available at http://www.regulations.gov. Persons
unable to download an electronic copy of ``Submission of Premarket
Notifications for Magnetic Resonance Diagnostic Devices'' may send an
email request to<EMAIL_ADDRESS>to receive an electronic
copy of the document. Please use the document number 340 to identify
the guidance you are requesting.

IV. Paperwork Reduction Act of 1995

    This draft guidance refers to previously approved collections of
information found in FDA regulations. These collections of information
are subject to review by the Office of Management and Budget (OMB)
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The
collections of information in 21 CFR part 807, subpart E, have been
approved under OMB control number 0910-0120, and the collections of
information in 21 CFR part 801 have been approved under OMB control
number 0910-0485.

V. Comments

    Interested persons may submit either electronic comments regarding
this document to http://www.regulations.gov or written comments to the
Division of Dockets Management (see ADDRESSES). It is only necessary to
send one set of comments. Identify comments with the docket number
found in brackets in the

heading of this document. Received comments may be seen in the Division
of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday,
and will be posted to the docket at http://www.regulations.gov.

    Dated: July 8, 2015.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2015-17250 Filed 7-13-15; 8:45 am]
 BILLING CODE 4164-01-P


[Federal Register Volume 83, Number 189 (Friday, September 28, 2018)]
[Rules and Regulations]
[Pages 48918-48920]
[FR Doc No: 2018-21103]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2018-0870; Product Identifier 2018-CE-047-AD; Amendment
39-19438; AD 2018-20-04]
RIN 2120-AA64

Airworthiness Directives; Gulfstream Aerospace Corporation
Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule; request for comments.

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SUMMARY: We are adopting a new airworthiness directive (AD) for all
Gulfstream Aerospace Corporation (Gulfstream) Model GVI airplanes. This
AD requires revising the Normal and Abnormal Procedures sections of the
airplane flight manual (AFM). This AD was prompted by potential failure
of the bi-directional data bus that sends and receives critical signals
between the flight control computer (FCC) and the flight control
surfaces. We are issuing this AD to address the unsafe condition on
these products.

DATES: This AD is effective October 15, 2018.
    The Director of the Federal Register approved the incorporation by
reference of certain publications listed in this AD as of October 15,
2018.
    We must receive comments on this AD by November 13, 2018.

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 http://www.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: U.S. Department of Transportation, Docket
Operations, M-30, 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 service information identified in this final rule, contact
Gulfstream Aerospace Corporation, Technical Publications Dept., P.O.
Box 2206, Savannah, GA 31402-2206; telephone:<PHONE_NUMBER>; fax: 912-
965-3520; email: [email protected]; internet: http://www.gulfstream.com/product-support/technical-publications. You may view
this service information at the FAA, Policy and Innovation Division,
901 Locust, Kansas City, Missouri 64106. For information on the
availability of this material at the FAA, call<PHONE_NUMBER>. It is
also available on the internet at http://www.regulations.gov by
searching for and locating Docket No. FAA-2018-0870.

Examining the AD Docket

    You may examine the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-
0870; 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, the regulatory evaluation, any comments received, and
other information. The street address for Docket Operations (phone:
800-647-5527) is listed above. Comments will be available in the AD
docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Myles Jalalian, Aerospace Engineer,
Systems and Equipment Section, AIR-7A3, Atlanta ACO Branch, FAA, 1701
Columbia Avenue, College Park, GA 30337; phone:<PHONE_NUMBER>; fax: 404-
474-5606; email: Myles.Jalali[email protected].

SUPPLEMENTARY INFORMATION:

Discussion

    On Gulfstream Model GVI airplanes, the FCC and the remote
electronics unit (REU) communicate with each other by means of bi-
directional data buses, referred to as BD429. Gulfstream notified us
that loss of bi-directional (Transmit/Receive) BD429 communication, due
to wire/connector failures, between the REU and the FCC would result in
the display of a cyan ``FCS MAINTENANCE REQUIRED'' advisory message on
the crew alerting system (CAS). Because this cyan advisory message does
not directly indicate that BD429 communication has failed, the aircraft
can be dispatched with this advisory message. The Model GVI system
depends on the BD429 bus to assure signal transmission to address a
linear variable differential transformer (LVDT) disconnect monitor and/
or surface oscillatory monitor event.
    During recent developmental testing, Gulfstream discovered that
certain BD429 failures prevent the shutdown of a flight control surface
that would normally occur during an oscillatory or LVDT disconnect
event. The only indication of the failure is a cyan ``FCS MAINTENANCE
REQUIRED'' advisory message on the CAS.
    If the FCC cannot receive information from the REU that a
particular flight control surface had an event, then the FCC cannot
issue a command to place that particular flight control surface into
standby/damped bypass mode. The REU will still receive flight control
commands from the FCC via the secondary (receive only) bus; however,
because the secondary bus is receive-only for certain REUs, the FCC
will no longer receive REU data needed for the LVDT disconnect monitor
and/or surface oscillatory monitor for the impacted flight control
surface.
    This condition (results in a cyan CAS message, but does not
indicate the exact reason) can remain latent for up to one year. To
date, there have been no known events or failures of the BD429
communications bus wiring or connectors in the field. However, the
Gulfstream GVI fleet has experienced multiple in-flight flight control
events requiring a standby command sent over the BD429 bus to keep the
airplane safe. Since the GVI system uses these monitors to mitigate
potentially unsafe failure modes, dispatch with their loss leaves the
aircraft one failure away from a potential loss of control event.
    This condition, if not addressed, could result in the FCC's
inability to identify when a problematic flight control surface needs
to be damped, which could result in loss of control of the airplane.

Related Service Information Under 1 CFR Part 51

    We reviewed Gulfstream Aerospace G650 AFM Supplement No. G650-2018-
01, dated August 14, 2018; and Gulfstream Aerospace G650ER AFM
Supplement No. G650ER-2018-01, dated August 14, 2018. For each
applicable airplane configuration, the AFM supplement provides
instructions and warnings to the Normal Procedures and Abnormal
Procedures section of the AFM for the pilot to follow if a cyan ``FCS
MAINTENANCE REQUIRED'' CAS message displays with the airplane on the
ground or in flight. This service information is reasonably available
because the interested parties have access to it through their normal
course of business or by the means identified in the ADDRESSES section.

FAA's Determination

    We are issuing this AD because we evaluated all the relevant
information and determined the unsafe condition described previously is
likely to exist or develop in other products of the same type design.

AD Requirements

    This AD requires revising the Normal and Abnormal Procedures
sections of the AFM by adding instructions and warnings for the pilot
if a cyan ``FCS MAINTENANCE REQUIRED'' CAS message displays with the
airplane on the ground or in flight.

Interim Action

    We consider this AD interim action. Gulfstream is analyzing the
failures and working to develop a terminating action that will address
the unsafe condition identified in this AD. Once this action is
developed, approved, and available, we might consider additional
rulemaking.

FAA's Justification and Determination of the Effective Date

    An unsafe condition exists that requires the immediate adoption of
this AD without providing an opportunity for public comments prior to
adoption. The FAA has found that the risk to the flying public
justifies waiving notice and comment prior to adoption of this rule
because the inability of the FCC to send a standby command when the
BD429 bus is in a failed state could leave the airplane with only one
level of protection from a catastrophic flight control failure.
Therefore, we find good cause that notice and opportunity for prior
public comment are impracticable. In addition, for the reason stated
above, we find that good cause exists for making this amendment
effective in less than 30 days.

Comments Invited

    This AD is a final rule that involves requirements affecting flight
safety and was not preceded by notice and an opportunity for public
comment. However, we invite you to send any written data, views, or
arguments about this final rule. Send your comments to an address
listed under the ADDRESSES section. Include the docket number FAA-2018-
0870 and Product Identifier 2018-CE-047-AD at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of this final rule. We will
consider all comments received by the closing date and may amend this
final rule because of those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this final rule.

Costs of Compliance

    We estimate that this AD affects 213 airplanes of U.S. registry.
    We estimate the following costs to comply with this AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per      Cost on U.S.
              Action                      Labor cost             Parts cost           product        operators
----------------------------------------------------------------------------------------------------------------
Revise Gulfstream AFM.............  1 work-hour x $85 per  Not applicable.......             $85         $18,105
                                     hour = $85.
----------------------------------------------------------------------------------------------------------------

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.
    We are 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.
    This AD is issued in accordance with authority delegated by the
Executive Director, Aircraft Certification Service, as authorized by
FAA Order 8000.51C. In accordance with that order, issuance of ADs is
normally a function of the Compliance and Airworthiness Division, but
during this transition period, the Executive Director has delegated the
authority to issue ADs applicable to small airplanes, gliders,
balloons, airships, domestic business jet transport airplanes, and
associated appliances to the Director of the Policy and Innovation
Division.

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,
    (2) Is not a ``significant rule'' under DOT Regulatory Policies and
Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

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

Adoption of 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 (AD):

2018-20-04 Gulfstream Aerospace Corporation: Amendment 39-19438;
Docket No. FAA-2018-0870; Product Identifier 2018-CE-047-AD.

(a) Effective Date

    This AD is effective October 15, 2018.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to Gulfstream Aerospace Corporation Model GVI
airplanes, all serial numbers, certificated in any category.

(d) Subject

    Joint Aircraft System Component (JASC)/Air Transport Association
(ATA) of America Code 27, Flight Controls.

(e) Unsafe Condition

    This AD was prompted by the potential for an un-annunciated
failure of the bi-directional data bus that sends critical signals
from the flight control computer to the flight controls. This unsafe
condition, if not addressed, could result in the flight control
computer's inability to identify when a problematic flight control
surface needs to be damped, which could result in loss of control of
the airplane.

(f) Compliance

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

(g) Airplane Flight Manual Revisions

    Within 30 days after October 15, 2018 (the effective date of
this AD), revise the Normal Procedures and Abnormal Procedures
sections of the airplane flight manual by adding the information in
Gulfstream Aerospace G650 Airplane Flight Manual Supplement No.
G650-2018-01, dated August 14, 2018; or Gulfstream Aerospace G650ER
Airplane Flight Manual Supplement No. G650ER-2018-01, dated August
14, 2018; as applicable to the model configuration of your airplane.

(h) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Atlanta ACO Branch, FAA, has the authority to
approve AMOCs for this AD, if requested using the procedures found
in 14 CFR 39.19. In accordance with 14 CFR 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 (i) of this AD.
    (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.

(i) Related Information

    For more information about this AD, contact Myles Jalalian,
Aerospace Engineer, Systems and Equipment Section, AIR-7A3, Atlanta
ACO Branch, FAA, 1701 Columbia Avenue, College Park, GA 30337;
phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
[email protected].

(j) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) 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) Gulfstream Aerospace G650 Airplane Flight Manual, Supplement
No. G650-2018-01, dated August 14, 2018.
    (ii) Gulfstream Aerospace G650ER Airplane Flight Manual,
Supplement No. G650ER-2018-01, dated August 14, 2018.
    (3) For service information identified in this AD, contact
Gulfstream Aerospace Corporation, Technical Publications Dept., P.O.
Box 2206, Savannah, GA 31402-2206; telephone:<PHONE_NUMBER>; fax:
912-965-3520; email: [email protected]; internet: http://www.gulfstream.com/product-support/technical-publications.
    (4) You may view this service information at the FAA, Policy and
Innovation Division, 901 Locust, Kansas City, Missouri 64106. For
information on the availability of this material at the FAA, call
(816) 329-4148.
    (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, call<PHONE_NUMBER>, or go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued in Kansas City, Missouri, on September 20, 2018.
Melvin J. Johnson,
Aircraft Certification Service, Deputy Director, Policy and Innovation
Division, AIR-601.
[FR Doc. 2018-21103 Filed 9-27-18; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 84, Number 95 (Thursday, May 16, 2019)]
[Notices]
[Pages 22192-22199]
[FR Doc No: 2019-10118]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85839; File No. SR-EMERALD-2019-20]

Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt
System Connectivity Fees

May 10, 2019.
    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 April 30, 2019, MIAX Emerald, LLC (``MIAX Emerald'' or
``Exchange''), filed with the Securities and Exchange Commission
(``Commission'') a proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is filing a proposal to amend the MIAX Emerald Fee
Schedule (the ``Fee Schedule'') to adopt the Exchange's system
connectivity fees.
    The Exchange initially filed the proposal on March 1, 2019 (SR-
EMERALD-2019-11). That filing has been withdrawn and replaced with the
current filing (SR-EMERALD-2019-20).
    The text of the proposed rule change is available on the Exchange's
website at http://www.miaxoptions.com/rule-filings/emerald, at MIAX's
principal office, 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 aspects of such
statements.

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

1. Purpose
    The Exchange proposes to amend the Fee Schedule regarding
connectivity to the Exchange. Specifically, the Exchange proposes to
amend Sections 5a) and b) of the Fee Schedule to adopt the network
connectivity fees for the 1 Gigabit (``Gb'') fiber connection and the
10Gb ultra-low latency (``ULL'') fiber connection, which are charged to
both Members \3\ and non-Members of the Exchange for connectivity to
the Exchange's primary/secondary facility. The Exchange also proposes
to adopt network connectivity fees for the 1Gb and 10Gb fiber
connections for connectivity to the Exchange's disaster recovery
facility. Each of these connections (with the exception of the 10Gb
ULL) are shared connections (collectively, the ``Shared Connections''),
and thus can be utilized to access the Exchange and both of the
Exchange's affiliates, Miami International Securities Exchange, LLC
(``MIAX'') and MIAX PEARL, LLC (``MIAX PEARL''). The 10Gb ULL
connection is a dedicated connection (``Dedicated Connection''), which
provides network connectivity solely to the trading platforms, market
data systems, and test system facilities of MIAX Emerald. These
proposed fees are collectively referred to herein as the ``Proposed
Fees.'' The amounts of the Proposed Fees for the Shared Connections are
the same amounts that are currently in place at MIAX and MIAX PEARL.\4\
While the Exchange is new and only launched trading on March 1, 2019,
since: (i) All of the Proposed Fees (except for the fee relating to the
10Gb ULL connection) relate to Shared Connections, and thus are the
same amounts as are currently in place at MIAX and MIAX PEARL; (ii) all
of the Members of MIAX Emerald are also members of either MIAX and/or
MIAX PEARL, and most of those Members already have connectivity to the
Exchange via existing Shared Connections (without paying any new
incremental connectivity fees), the Exchange is providing similar
information to that which was provided in the MIAX and PEARL Fee
Filings, including providing detail about the market participants
impacted by the Proposed Fees, as well as the costs incurred by the
Exchange associated with providing the connectivity alternatives, in
order to provide transparency and support relating to the Exchange's
belief that the Proposed Fees are reasonable, equitable, and non-
discriminatory, and to provide sufficient information for the
Commission to determine that the Proposed Fees are consistent with the
Act.
---------------------------------------------------------------------------

    \3\ The term ``Member'' means an individual or organization
approved to exercise the trading rights associated with a Trading
Permit. Members are deemed ``members'' under the Exchange Act. See
Exchange Rule 100.
    \4\ See SR-MIAX-2019-23 and SR-PEARL-2019-17 (the ``MIAX and
PEARL Fee Filings'').
---------------------------------------------------------------------------

    The Exchange initially filed the Proposed Fees on March 1, 2019,
designating the Proposed Fees immediately effective.\5\ The First
Proposed Rule Change was published for comment in the Federal Register
on March 20, 2019.\6\ The First Proposed Rule Change provided
information about the market participants impacted

by the Proposed Fees, as well as the additional costs incurred by the
Exchange associated with providing the connectivity alternatives, in
order to provide transparency and support relating to the Exchange's
belief that the Proposed Fees are reasonable, equitable, and non-
discriminatory, and to provide sufficient information for the
Commission to determine that the Proposed Fees are consistent with the
Act.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 85316 (March 14,
2019), 84 FR 10350 (March 20, 2019) (SR-EMERALD-2019-11) (the
``First Proposed Rule Change'').
    \6\ Id.
---------------------------------------------------------------------------

    On March 29, 2019, the Commission issued its Order Disapproving
Proposed Rule Changes to Amend the Fee Schedule on the BOX Market LLC
Options Facility to Establish BOX Connectivity Fees for Participants
and Non-Participants Who Connect to the BOX Network (the ``BOX
Order'').\7\ In the BOX Order, the Commission highlighted a number of
deficiencies it found in three separate rule filings by BOX Exchange
LLC (``BOX'') to increase BOX's connectivity fees that prevented the
Commission from finding that BOX's proposed connectivity fees were
consistent with the Act. These deficiencies relate to topics that the
Commission believes should be discussed in a connectivity fee filing.
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release No. 85459 (March 29,
2019), 84 FR 13363 (April 4, 2019) (SR-BOX-2018-24, SR-BOX-2018-37,
and SR-BOX-2019-04).
---------------------------------------------------------------------------

    After the BOX Order was issued, the Commission received four
comment letters on the First Proposed Rule Change.\8\
---------------------------------------------------------------------------

    \8\ See Letter from Joseph W. Ferraro III, SVP & Deputy General
Counsel, MIAX, to Vanessa Countryman, Acting Secretary, Commission,
dated April 5, 2019 (``MIAX Letter''); Letter from Theodore R. Lazo,
Managing Director and Associate General Counsel, SIFMA, to Vanessa
Countryman, Acting Secretary, Commission, dated April 10, 2019
(``Second SIFMA Letter''); Letter from John Ramsay, Chief Market
Policy Officer, Investors Exchange LLC, to Vanessa Countryman,
Acting Secretary, Commission, dated April 10, 2019 (``IEX Letter'');
and Letter from Tyler Gellasch, Executive Director, Healthy Markets,
to Brent J. Fields, Secretary, Commission, dated April 18, 2019
(``Second Healthy Markets Letter'').
---------------------------------------------------------------------------

    The Second SIFMA Letter argued that the Exchange did not provide
sufficient information in its First Proposed Rule Change to support a
finding that the proposal should be approved by the Commission after
further review of the Proposed Fees. Specifically, the Second SIFMA
Letter argued that the Exchange's market data fees and connectivity
fees were not constrained by competitive forces, the Exchange's filing
lacked sufficient information regarding cost and competition, and that
the Commission should establish a framework for determining whether
fees for exchange products and services are reasonable when those
products and services are not constrained by significant competitive
forces.
    The IEX Letter argued that the Exchange did not provide sufficient
information in its First Proposed Rule Change to support a finding that
the proposal should be approved by the Commission and that the
Commission should extend the time for public comment on the First
Proposed Rule Change. Despite the objection to the Proposed Fees, the
IEX Letter did find that ``MIAX has provided more transparency and
analysis in these filings than other exchanges have sought to do for
their own fee increases.'' \9\ The IEX Letter specifically argued that
the Proposed Fees were not constrained by competition, the Exchange
should provide data on the Exchange's actual costs and how those costs
relate to the product or service in question, and whether and how MIAX
Emerald and its affiliates considered changes to transaction fees as an
alternative to offsetting exchange costs.
---------------------------------------------------------------------------

    \9\ See IEX Letter, pg. 1.
---------------------------------------------------------------------------

    The Second Healthy Markets Letter did not object to the First
Proposed Rule Change and the information provided by the Exchange in
support of the Proposed Fees. Specifically, the Second Healthy Markets
Letter stated that the First Proposed Rule Change was ``remarkably
different,'' and went on to further state as follows:

    The instant MIAX filings--along with their April 5th
supplement--provide much greater detail regarding users of
connectivity, the market for connectivity, and costs than the
Initial MIAX Filings. They also appear to address many of the issues
raised by the Commission staff's BOX disapproval order. This third
round of MIAX filings suggests that MIAX is operating in good faith
to provide what the Commission and staff seek.\10\
---------------------------------------------------------------------------

    \10\ See Second Healthy Markets Letter, pg. 2.

    On April 29, 2019, the Exchange withdrew the First Proposed Rule
Change.\11\ The Exchange is now re-filing the Proposed Fees to squarely
and comprehensively address each and every topic raised for discussion
in the BOX Order, the IEX Letter and the Second SIFMA Letter to ensure
that the Proposed Fees are reasonable, equitable, and non-
discriminatory, and that the Commission should find that the Proposed
Fees are consistent with the Act. The proposed rule change is
immediately effective upon filing with the Commission pursuant to
Section 19(b)(3)(A) of the Act.
---------------------------------------------------------------------------

    \11\ See SR-EMERALD-2019 11.
---------------------------------------------------------------------------

    The Exchange proposes to offer to both Members and non-Members
various bandwidth alternatives for connectivity to the Exchange, to its
primary and secondary facilities, consisting of a 1Gb fiber connection
and a 10Gb ULL fiber connection. The 10Gb ULL offering uses an ultra-
low latency switch, which provides faster processing of messages sent
to it in comparison to the switch used for the other types of
connectivity. The Exchange also proposes to offer to both Members and
non-Members various bandwidth alternatives for connectivity to the
Exchange, to its disaster recovery facility, consisting of a 1Gb fiber
connection and a 10Gb connection.
    For the Shared Connections, the Exchange's MIAX Express Network
Interconnect (``MENI'') can be configured to provide Members and non-
Members of the Exchange network connectivity to the trading platforms,
market data systems, test systems, and disaster recovery facilities of
the Exchange and its affiliates, MIAX and MIAX PEARL, via a single,
shared connection. Any Member or non-Member can purchase a Shared
Connection.
    For the Dedicated Connection, the Exchange's MENI is configured to
provide Members and non-Members of the Exchange network connectivity to
the trading platforms, market data systems, test systems, and disaster
recovery facilities of the Exchange. Any Member or non-Member can
purchase a Dedicated Connection. The Exchange determined to design its
network architecture in a manner that offered 10Gb ULL connections as
dedicated connections (as opposed to shared connections) in order to
provide cost saving opportunities for itself and for its Members, by
reducing the amount of equipment that the Exchange would have to
purchase and to which the Members would have to connect.
    For the Shared Connections, Members and non-Members utilizing the
MENI to connect to the trading platforms, market data systems, test
systems and disaster recovery facilities of the Exchange, MIAX, and
MIAX PEARL via a single, shared connection are assessed only one
monthly network connectivity fee per connection, regardless of the
trading platforms, market data systems, test systems, and disaster
recovery facilities accessed via such connection. Thus, since all of
the Members of MIAX Emerald are also members of either MIAX and/or MIAX
PEARL, and most of those Members already have connectivity to the
Exchange via existing Shared Connections, most Members of MIAX Emerald
have instant connectivity to the Exchange without paying any new
incremental

connectivity fees, as more fully-detailed below.
    The Exchange proposes to establish the monthly network connectivity
fees for such connections for both Members and non-Members. As
discussed above, the amounts of the Proposed Fees for the Shared
Connections are the same amounts that are currently in place at MIAX
and MIAX PEARL. The amount of the Proposed Fee for the Dedicated
Connection is offered at a substantial discount to the amount currently
in place at MIAX and MIAX PEARL. The reason for the substantial
discount is that the Dedicated Connection offers access to only a
single market (the Exchange), whereas the 10Gb ULL connection offered
by MIAX and MIAX PEARL offers access to two markets (MIAX and MIAX
PEARL). The network connectivity fees for connectivity to the
Exchange's primary/secondary facility will be as follows: (a) 1,400 for
the 1Gb connection; and (b) $6,000 for the 10Gb ULL connection. The
network connectivity fees for connectivity to the Exchange's disaster
recovery facility will be as follows: (a) $550 for the 1Gb connection;
and (b) $2,750 for the 10Gb connection.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \12\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \13\ in
particular, in that it provides for the equitable allocation of
reasonable dues, fees and other charges among Exchange Members and
issuers and other persons using any facility or system which the
Exchange operates or controls. The Exchange also believes the proposal
furthers the objectives of Section 6(b)(5) of the Act \14\ in that it
is designed 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 and is not designed to permit unfair
discrimination between customer, issuers, brokers and dealers.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(4).
    \14\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    First, the Exchange believes that its proposal is consistent with
Section 6(b)(4) of the Act, in that the Proposed Fees are fair,
equitable and not unreasonably discriminatory, because the fees for the
connectivity alternatives available on the Exchange, as proposed, are
competitive and market-driven. The U.S. options markets are highly
competitive (there are currently 16 options markets) and a reliance on
competitive markets is an appropriate means to ensure equitable and
reasonable prices.
    The Exchange acknowledges that there is no regulatory requirement
that any market participant connect to the Exchange, or that any
participant connect at any specific connection speed. The rule
structure for options exchanges are, in fact, fundamentally different
from those of equities exchanges. In particular, options market
participants are not forced to connect to (and purchase market data
from) all options exchanges, as shown by the number of Members of MIAX
Emerald as compared to the much greater number of members at other
options exchanges (as further detailed below). MIAX Emerald is a brand
new exchange, having only commenced operations in March 2019. Not only
does MIAX Emerald have less than half the number of members as certain
other options exchanges, but there are also a number of the Exchange's
Members that do not connect directly to MIAX Emerald. Further, of the
number of Members that connect directly to MIAX Emerald, many such
Members do not purchase market data from MIAX Emerald. There are a
number of large market makers and broker-dealers that are members of
other options exchanges but not Members of MIAX Emerald. For example,
the following are not Members of MIAX Emerald: The D. E. Shaw Group,
CTC, XR Trading LLC, Hardcastle Trading AG, Ronin Capital LLC,
Belvedere Trading, LLC, Bluefin Trading, and HAP Capital LLC. In
addition, of the market makers that are connected to MIAX Emerald, it
is the individual needs of the market maker that require whether they
need one connection or multiple connections to the Exchange. The
Exchange has market maker Members that only purchase one connection and
the Exchange has market maker Members that purchase multiple
connections. It is all driven by the business needs of the market
maker. Market makers that are consolidators that target resting order
flow tend to purchase more connectivity than market makers that simply
quote all symbols on the Exchange. Even though non-Members purchase and
resell 10Gb ULL connections to both Members and non-Members, no market
makers currently connect to the Exchange indirectly through such
resellers.
    SIFMA's argument that all broker-dealers are required to connect to
all exchanges is not true in the options markets. The options markets
have evolved differently than the equities markets both in terms of
market structure and functionality. For example, there are many order
types that are available in the equities markets that are not utilized
in the options markets, which relate to mid-point pricing and pegged
pricing which require connection to the SIPs and each of the equities
exchanges in order to properly execute those orders in compliance with
best execution obligations. In addition, in the options markets there
is a single SIP (OPRA) versus two SIPs in the equities markets,
resulting in fewer hops and thus alleviating the need to connect
directly to all the options exchanges. Additionally, in the options
markets, the linkage routing and trade through protection are handled
by the exchanges, not by the individual members. Thus not connecting to
an options exchange or disconnecting from an options exchange does not
potentially subject a broker-dealer to violate order protection
requirements as suggested by SIFMA. Gone are the days when the retail
brokerage firms (the Fidelity's, the Schwab's, the eTrade's) were
members of the options exchanges--they are not members of MIAX Emerald
or its affiliates, MIAX and MIAX PEARL, they do not purchase
connectivity to MIAX Emerald, and they do not purchase market data from
MIAX Emerald. The Exchange further recognizes that the decision of
whether to connect to the Exchange is separate and distinct from the
decision of whether and how to trade on the Exchange. The Exchange
acknowledges that many firms may choose to connect to the Exchange, but
ultimately not trade on it, based on their particular business needs.
    To assist prospective Members or firms considering connecting to
MIAX Emerald, the Exchange provides information about the Exchange's
available connectivity alternatives.\15\ The decision of which type of
connectivity to purchase, or whether to purchase connectivity at all
for a particular exchange, is based on the business needs of the firm.
For example, if the firm wants to receive the top-of-market data feed
product or depth data feed product, due to the amount/size of data
contained in those feeds, such firm would need to purchase a 10Gb ULL
connection. The 1Gb connection is too small to support those data feed
products. MIAX Emerald notes that there are twelve (12) Members that
only

purchase the 1Gb connectivity alternative. Thus, while there is a
meaningful percentage of purchasers of only 1Gb connections (12 of 33),
by definition, those twelve (12) members purchase connectivity that
cannot support the top-of-market data feed product or depth data feed
product and thus they do not purchase such data feed products.
Accordingly, purchasing market data is a business decision/choice, and
thus the pricing for it is constrained by competition.
---------------------------------------------------------------------------

    \15\ See the MIAX Connectivity Guide at https://www.miaxoptions.com/sites/default/files/page-files/MIAX_Connectivity_Guide_v3.6_01142019.pdf.
---------------------------------------------------------------------------

    Contrary to SIFMA's argument, there is competition for connectivity
to MIAX Emerald and its affiliates. MIAX Emerald competes with eight
(8) non-Members, who resell MIAX Emerald connectivity. Those non-
Members resell that connectivity to multiple market participants over
that same connection, including both Members and non-Members of MIAX
Emerald (typically extranets and service bureaus). When connectivity is
re-sold by a third-party, MIAX Emerald does not receive any
connectivity revenue from that sale. It is entirely between the third-
party and the purchaser, thus constraining the ability of MIAX Emerald
to set its connectivity pricing as indirect connectivity is a
substitute for direct connectivity. In fact, there are currently seven
(7) non-Members that purchase 1Gb direct connectivity that are able to
access MIAX Emerald, MIAX and MIAX PEARL. Those non-Members resell that
connectivity to eight (8) customers, some of whom are agency broker-
dealers that have tens of customers of their own. Some of those eight
(8) customers also purchase connectivity directly from MIAX Emerald
and/or its affiliates, MIAX and MIAX PEARL. Accordingly, indirect
connectivity is a viable alternative used by non-Members of MIAX
Emerald, constraining the price that MIAX Emerald is able to charge for
connectivity to its Exchange.
    The Exchange,\16\ MIAX,\17\ and MIAX PEARL \18\ are comprised of 41
distinct members amongst all three exchanges, excluding any additional
affiliates of such members that are also members of the Exchange, MIAX,
MIAX PEARL, or any combination thereof. Of those 41 distinct members,
28 of those distinct members are Members of MIAX Emerald. (Currently,
there are no Members of MIAX Emerald that are not also members of MIAX
or MIAX PEARL, or both.) Of those 28 distinct Members of MIAX Emerald,
there are 6 Members that have no connectivity to the Exchange. Members
are not forced to purchase connectivity to the Exchange, and these
Members have elected not to purchase such connectivity. Of note, these
same 6 Members also do not have connectivity to either MIAX or MIAX
PEARL. These Members either trade indirectly through other Members or
non-Members that have connectivity to the Exchange, or do not trade and
conduct another type of business on the Exchange. Of the remaining 22
distinct Members of MIAX Emerald, all 22 of those distinct Members
already had connectivity to the Exchange via existing Shared
Connections, thus providing all such 22 MIAX Emerald Members with
instant connectivity to the Exchange without paying any new incremental
connectivity fees.
---------------------------------------------------------------------------

    \16\ The Exchange has 28 distinct Members, excluding affiliated
entities. See MIAX Emerald Exchange Member Directory, available at
https://www.miaxoptions.com.
    \17\ MIAX has 38 distinct Members, excluding affiliated
entities. See MIAX Exchange Member Directory, available at https://www.miaxoptions.com.
    \18\ MIAX PEARL has 36 distinct Members, excluding affiliated
entities. See MIAX PEARL Exchange Member Directory, available at
https://www.miaxoptions.com.
---------------------------------------------------------------------------

    Further, of those 22 Members, 14 of such Members elected to
purchase additional connectivity to the Exchange, including additional
Shared Connections and additional Dedicated Connections. The Exchange
made available in advance to all of its prospective Members its
proposed connectivity pricing (subject to regulatory clearance), in
order for those prospective Members to make an informed decision about
whether to become a Member of the Exchange and whether to purchase
connectivity to the Exchange. Accordingly, each such Member made the
decision to become a Member of the Exchange and to purchase
connectivity to the Exchange, knowing in advance the connectivity
pricing. And the vast majority of the additional connectivity purchased
by those Members were for Dedicated Connections, the most expensive
connectivity option.
    As a result, of those 22 Members, through existing Shared
Connections, newly purchased Shared Connections, and newly purchased
Dedicated Connections: 14 Members have 1Gb (primary/secondary)
connections; 13 Members have 10Gb ULL (primary/secondary) connections;
3 Members have 10Gb (disaster recovery) connections; and 10 Members
have 1Gb (disaster recovery) connections, or some combination of
multiple various connections. All such Members with those Shared
Connections and Dedicated Connections trade on MIAX Emerald.
    The 6 Members who have not purchased any connectivity to the
Exchange are still able to trade on the Exchange indirectly through
other Members or non-Member service bureaus that are connected. These 6
Members who have not purchased connectivity are not forced or compelled
to purchase connectivity, and they retain all of the other benefits of
membership with the Exchange. Accordingly, Members have the choice to
purchase connectivity and are not compelled to do so in any way.
    In addition, there are 5 non-Member service bureaus that already
have connectivity to the Exchange via existing Shared Connections, thus
providing all 5 of those non-Member service bureaus with instant
connectivity to the Exchange without paying any new incremental
connectivity fees. These non-Members freely purchased their
connectivity from one of the Exchange's affiliates, either MIAX or MIAX
PEARL, in order to offer trading services to other firms and customers,
as well as access to the market data services that their connections to
the Exchange provide them, but they are not required or compelled to
purchase any of the Exchange's connectivity options.
    The Exchange believes that the Proposed Fees are fair, equitable
and not unreasonably discriminatory because the connectivity pricing is
associated with relative usage of the various market participants and
does not impose a barrier to entry to smaller participants.
Accordingly, the Exchange offers two direct connectivity alternatives
and various indirect connectivity (via third-party) alternatives, as
described above. MIAX Emerald recognizes that there are various
business models and varying sizes of market participants conducting
business on the Exchange. The 1Gb direct connectivity alternative is 1/
10th the size of the 10Gb ULL direct connectivity alternative.
Approximately just less than half of MIAX Emerald, MIAX and MIAX PEARL
Members that connect (15 out of 33) purchase 1Gb connections. The 1Gb
direct connection can support the sending of orders and the consumption
of all market data feed products, other than the top-of-market data
feed product or depth data feed product (which require a 10Gb
connection). The 1Gb direct connection is generally purchased by market
participants that utilize less bandwidth. The market participants that
purchase 10Gb ULL direct connections utilize the most bandwidth, and
those are the participants that consume the most resources from the
network. Accordingly, the Exchange believes the allocation of the
Proposed Fees ($6,000 for a 10Gb ULL connection versus $1,400 for a 1Gb
connection) are

reasonable based on the network resources consumed by the market
participants--lowest bandwidth consuming members pay the least, and
highest bandwidth consuming members pays the most, particularly since
higher bandwidth consumption translates to higher costs to the
Exchange. The 10Gb ULL connection offers optimized connectivity for
latency sensitive participants. This lower latency is achieved through
more advanced network equipment, such as advanced hardware and
switching components, which translates to increased costs to the
Exchange.
    The Exchange launched trading on March 1, 2019. Thus, at the time
that the 14 Members who elected to purchase connectivity to the
Exchange, the Exchange was untested and unproven, and had 0% market
share of the U.S. options industry. For all of 2018, the Exchange's
affiliate, MIAX, had only 4.39% market share of the U.S. options
industry in 2018 in Equity/ETF classes according to the OCC.\19\ For
all of 2018, the Exchange's affiliate, MIAX PEARL, had only 4.82%
market share of the U.S. options industry in Equity/ETF classes
according to the OCC.\20\ The Exchange is not aware of any evidence
that a combined market share less than 10% provides the Exchange with
anti-competitive pricing power. This, in addition to the fact that not
all broker-dealers are required to connect to all options exchanges,
supports the Exchange's conclusion that its pricing is constrained by
competition. Certainly, an untested and unproven exchange, with 0%
market share, and no rule or requirement that a market participant must
join or connect to it, does not have anti-competitive pricing power,
with respect to setting the pricing for the Dedicated Connections or
the Shared Connections. If the Exchange were to attempt to establish
unreasonable connectivity pricing, then no market participant would
join or connect. Therefore, since 28 distinct Members joined MIAX
Emerald and 14 of those distinct Members purchased additional
connectivity to the Exchange, all knowing, in advance, the connectivity
fees, the Exchange believes the Proposed Fees are reasonable,
equitable, and not unfairly discriminatory.
---------------------------------------------------------------------------

    \19\ See Exchange Market Share of Equity Products--2018, The
Options Clearing Corporation, available at https://www.theocc.com/webapps/exchange-volume.
    \20\ Id.
---------------------------------------------------------------------------

    Separately, the Exchange is not aware of any reason why market
participants could not simply drop their connections and cease being
Members of the Exchange if the Exchange were to establish unreasonable
and uncompetitive price increases for its connectivity alternatives.
Market participants choose to connect to a particular exchange and
because it is a choice, MIAX Emerald must set reasonable connectivity
pricing, otherwise prospective members would not connect and existing
members would disconnect or connect through a third-party reseller of
connectivity. No options market participant is required by rule,
regulation, or competitive forces to be a Member of the Exchange.
Several market participants choose not to be Members of the Exchange
and choose not to access the Exchange, and several market participants
are proposing to access the Exchange indirectly through another market
participant. To illustrate, the Exchange has only 34 total Members
(including all such Members' affiliate Members). However, Cboe
Exchange, Inc. (``Cboe'') has over 200 members,\21\ Nasdaq ISE, LLC has
approximately 100 members,\22\ and NYSE American LLC has over 80
members.\23\ If all market participants were required to be Members of
the Exchange and connect directly to the Exchange, the Exchange would
have over 200 Members, in line with Cboe's total membership. But it
does not. The Exchange only has 34 Members.
---------------------------------------------------------------------------

    \21\ See Form 1/A, filed August 30, 2018 (https://www.sec.gov/Archives/edgar/vprr/1800/18002831.pdf); Form 1/A, filed August 30,
2018 (https://www.sec.gov/Archives/edgar/vprr/1800/18002833.pdf);
Form 1/A, filed July 24, 2018 (https://www.sec.gov/Archives/edgar/vprr/1800/18002781.pdf); Form 1/A, filed August 30, 2018 (https://www.sec.gov/Archives/edgar/data/1473845/999999999718007832/9999999997-18-007832-index.htm).
    \22\ See Form 1/A, filed July 1, 2016 (https://www.sec.gov/Archives/edgar/vprr/1601/16019243.pdf).
    \23\ See https://www.nyse.com/markets/american-options/membership#directory.
---------------------------------------------------------------------------

    Further, since there are 41 distinct members amongst all three
exchanges, and only 28 of those distinct members decided to become
Members of MIAX Emerald, there were 13 distinct members that decided
not to become Members of MIAX Emerald. This further reinforces the fact
that all market participants are not required to be Members of the
Exchange and are not required to connect to the Exchange. It is a
choice whether to join and it is a choice to connect. Therefore, the
Exchange believes that the Proposed Fees are fair, equitable, and non-
discriminatory, as the fees are competitive.
    With respect to the now MIAX Emerald Members that had Shared
Connections in place as of August 1, 2018 (via a previously purchased
Shared Connection from MIAX or MIAX PEARL), the Exchange finds it
compelling that all of those Members continued to purchase those Shared
Connections after August 1, 2018, when MIAX and MIAX PEARL increased
the connectivity fees for the Shared Connections to the current amounts
proposed by the Exchange herein. In particular, the Exchange believes
that the Proposed Fees for the Shared Connections are reasonable
because MIAX and MIAX PEARL, which charge the same amount for the
Shared Connections, did not lose any Members (or the number of Shared
Connections each Member purchased) or non-Member Shared Connections
when MIAX and MIAX PEARL proposed to increase the connectivity fees for
the Shared Connections on August 1, 2018. For example, with respect to
the Shared Connections maintained by now Members of MIAX Emerald who
had Shared Connections in place as of July 2018, 12 Members purchased
1Gb connections. The vast majority of those Members purchased multiple
such connections, the number of connections depending on their
throughput requirements based on the volume of their quote/order
traffic and market data needs associated with their business model.
After the fee increase, beginning August 1, 2018, the same 12 Members
purchased 1Gb connections. Furthermore, the total number of connections
did not decrease from July to August.
    Further, with respect to the Shared Connections maintained by now
Members of MIAX Emerald who had Shared Connections in place as of July
2018, of those Members and non-Members that bought multiple
connections, no firm dropped any connections beginning August 1, 2018,
when MIAX and MIAX PEARL increased its fees. Furthermore, the Exchange
understands that MIAX and MIAX PEARL did not receive any official
comment letters or complaints from any now Members of MIAX Emerald who
had Shared Connections in place as of July 2018 regarding the increased
fees regarding how the change was unreasonable, unduly burdensome, or
would negatively impact their competitiveness amongst other market
participants. These facts, coupled with the discussion above, showing
that it is not necessary to join and/or connect to all options
exchanges, demonstrate that the Exchange's fees are constrained by
competition and are reasonable and not contrary to the Law of Demand as
SIFMA suggests. Therefore, the

Exchange believes that the Proposed Fees are fair, equitable, and non-
discriminatory, as the fees are competitive.
    The Exchange believes that the Proposed Fees are equitably
allocated among Members and non-Members, as evidenced by the fact that
the fees are allocated across all connectivity alternatives, and there
is not a disproportionate number of Members purchasing any
alternative--14 Members have 1Gb (primary/secondary) connections; 14
Members have 10Gb ULL (primary/secondary) connections; 3 Members have
10Gb (disaster recovery) connections; and 11 Members have 1Gb (disaster
recovery) connections, or some combination of multiple various
connections.
    Second, the Exchange believes that its proposal is consistent with
Section 6(b)(4) of the Act because the Proposed Fees allow the Exchange
to recover a portion (less than all) of the costs incurred by the
Exchange associated with providing and maintaining the necessary
hardware and other infrastructure to support this technology. The
Exchange believes that it is reasonable and appropriate to establish
its fees charged for use of its connectivity at a level that will
partially offset the costs to the Exchange associated with maintaining
and enhancing a state-of-the-art exchange network infrastructure in the
U.S. options industry.
    The costs associated with making the network accessible to Exchange
Members and non-Members, through the expansion associated with new
Shared Connections and Dedicated Connections, as well as the general
expansion of a state-of-the-art infrastructure, are extensive, have
increased year-over-year in the past two years, and are projected to
increase year-over-year in the future. This is due to several factors,
including costs associated with maintaining and expanding a team of
highly-skilled network engineers, fees charged by the Exchange's third-
party data center operator, and costs associated with projects and
initiatives designed to improve overall network performance and
stability, through the Exchange's research and development (``R&D'')
efforts.
    In order to provide more detail and to quantify the Exchange's
costs, the Exchange notes that costs are associated with the
infrastructure and headcount to fully-support the advances in
infrastructure and expansion of network level services, including
customer monitoring, alerting and reporting. The Exchange incurs
technology expenses related to establishing and maintaining Information
Security services, enhanced network monitoring and customer reporting,
as well as Regulation SCI mandated processes, associated with its
network technology. Additionally, the Exchange incurred costs in the
expansion/buildout of the network leading up to the launch of
operations, and the network maintenance costs continue to increase
year-over-year. While some of the expense is fixed, much of the expense
is not fixed, and thus increases as the number of connections increase.
For example, new 1Gb and 10Gb ULL connections require the purchase of
additional hardware to support those connections as well as enhanced
monitoring and reporting of customer performance that MIAX Emerald and
its affiliates provide. And 10Gb ULL connections require the purchase
of specialized, more costly hardware. Further, as the total number of
all connections increase, MIAX Emerald and its affiliates need to
increase their data center footprint and consume more power, resulting
in increased costs charged by their third-party data center provider.
Accordingly, cost to MIAX Emerald and its affiliates is not entirely
fixed. Just the initial fixed cost buildout of the network
infrastructure of MIAX Emerald and its affiliates, including both
primary/secondary sites and disaster recovery, was over $30 million.
The current annual operational expense (which relates 100% to the
network infrastructure, associated data center processing equipment
required to support various connections, network monitoring systems and
associated software required to support the various forms of
connectivity) is approximately $8.5 million. This does not include
additional indirect expenses that the Exchange incurs that are
allocated to the support of network infrastructure of the Exchange. As
these operational expenses increase, MIAX Emerald and its affiliates
look to offset those costs through increased connectivity fees.
    A more detailed breakdown of the operational expense increases,
since the initial phases of the buildout of the Exchange over two years
ago include the following: With respect to the network, there has been
an approximate 70% increase in technology-related personnel costs in
infrastructure, due to expansion of services/support (increase of
approximately $800,000); an approximate 10% increase in datacenter
costs due to price increases and footprint expansion (increase of
approximately $500,000); an approximate 5% increase in vendor-supplied
dark fiber due to price increases and expanded capabilities (increase
of approximately $25,000); and a 30% increase in market data
connectivity fees (increase of approximately $200,000). Of note,
regarding market data connectivity fee cost, this is the cost
associated with MIAX Emerald consuming connectivity/content from the
equities markets in order to operate the Exchange, causing MIAX Emerald
to effectively pay its competitors for this connectivity. There was
also significant capital expenditures over this same period to upgrade
and enhance the underlying technology components. The Exchange believes
that it is reasonable and appropriate to establish its fees charged for
use of its connectivity at a level that will partially offset the costs
to the Exchange associated with the buildout, maintenance, and
enhancement of its network infrastructure.
    Further, because the costs of operating a data center are
significant and not economically feasible for the Exchange, the
Exchange does not operate its own data centers, and instead contracts
with a third-party data center provider. The Exchange notes that
larger, dominant exchange operators own/operate their data centers,
which offers them greater control over their data center costs. Because
those exchanges own and operate their data centers as profit centers,
the Exchange is subject to additional costs. Connectivity fees, which
are charged for accessing the Exchange's data center network
infrastructure, are directly related to the network and offset costs
such costs.
    Further, the Exchange invests significant resources in network R&D
to improve the overall performance and stability of its network. For
example, the Exchange has a number of network monitoring tools (some of
which were developed in-house, and some of which are licensed from
third-parties), that continually monitor, detect, and report network
performance, many of which serve as significant value-adds to the
Exchange's Members and enable the Exchange to provide a high level of
customer service. These tools detect and report performance issues, and
thus enable the Exchange to proactively notify a Member (and the SIPs)
when the Exchange detects a problem with a Member's connectivity. The
Exchange also incurs costs associated with the maintenance and
improvement of existing tools and the development of new tools.
    Certain recently developed network aggregation and monitoring tools
provide the Exchange with the ability to measure network traffic with a
much

more granular level of variability. This is important as Exchange
Members demand a higher level of network determinism and the ability to
measure variability in terms of single digit nanoseconds. Also, routine
R&D projects to improve the performance of the network's hardware
infrastructure result in additional cost. As an example, in the last
year, R&D efforts resulted in a performance improvement, requiring the
purchase of new equipment to support that improvement, and thus
resulting in increased costs in the hundreds of thousands of dollars
range. In sum, the costs associated with maintaining and enhancing a
state-of-the-art exchange network infrastructure in the U.S. options
industry is a significant expense for the Exchange that also increases
year-over-year, and thus the Exchange believes that it is reasonable to
offset a portion of those costs through establishing network
connectivity fees, as proposed herein. Overall, the Proposed Fees are
projected to offset only a portion of the Exchange's network
connectivity costs. The Exchange invests in and offers a superior
network infrastructure as part of its overall options exchange services
offering, resulting in significant costs associated with maintaining
this network infrastructure, which are directly tied to the amount of
the connectivity fees that must be charged to access it, in order to
recover those costs.
    The Exchange also believes its proposal to offer 10Gb ULL
connections as dedicated connections furthers the objectives of Section
6(b)(5) of the Act \24\ in that it is designed 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 and is not
designed to permit unfair discrimination between customer, issuers,
brokers and dealers. In particular, for the Dedicated Connection, the
Exchange's MENI is configured to provide Members and non-Members of the
Exchange network connectivity to the trading platforms, market data
systems, test systems, and disaster recovery facilities of the
Exchange. Any Member or non-Member can purchase a Dedicated Connection.
The Exchange determined to design its network architecture in a manner
that offered 10Gb ULL connections as dedicated connections (as opposed
to shared connections) in order to provide cost saving opportunities
for itself and for its Members, by reducing the amount of equipment
that the Exchange would have to purchase and to which the Members would
have to connect. A dedicated 10Gb ULL connection does not offer any
unfair advantage over a shared 10GB ULL connection, as is being offered
solely as a cost-saving measure to the Exchange and its Members.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange notes that other exchanges have similar connectivity
alternatives for their participants, including similar low-latency
connectivity. For example, Nasdaq PHLX LLC (``Phlx''), NYSE Arca, Inc.
(``Arca''), NYSE American LLC (``NYSE American'') and Nasdaq ISE, LLC
(``ISE'') all offer a 1Gb, 10Gb and 10Gb low latency ethernet
connectivity alternatives to each of their participants.\25\ The
Exchange further notes that Phlx, ISE, Arca and NYSE American each
charge higher rates for such similar connectivity to primary and
secondary facilities,\26\ however the Exchange also notes that the
Exchange's 10Gb ULL connection is dedicated solely to one market (the
Exchange) whereas the Exchange believes that other exchanges offer a
shared 10Gb ULL connection to multiple markets. While MIAX Emerald's
proposed connectivity fees are substantially lower than the fees
charged by Phlx, ISE, Arca and NYSE American, MIAX Emerald believes
that it offers significant value to Members over other exchanges in
terms of network monitoring and reporting, which MIAX Emerald believes
is a competitive advantage, and differentiates its connectivity versus
connectivity to other exchanges. Additionally, the Exchange's proposed
connectivity fees to its disaster recovery facility are within the
range of the fees charged by other exchanges for similar connectivity
alternatives.\27\
---------------------------------------------------------------------------

    \25\ See Phlx and ISE Rules, General Equity and Options Rules,
General 8, Section 1(b). Phlx and ISE each charge a monthly fee of
$2,500 for each 1Gb connection, $10,000 for each 10Gb connection and
$15,000 for each 10Gb Ultra connection, which the equivalent of the
Exchange's 10Gb ULL connection. See also NYSE American Fee Schedule,
Section V.B, and Arca Fees and Charges, Co-Location Fees. NYSE
American and Arca each charge a monthly fee of $5,000 for each 1Gb
circuit, $14,000 for each 10Gb circuit and $22,000 for each 10Gb LX
circuit, which the equivalent of the Exchange's 10Gb ULL connection.
    \26\ Id.
    \27\ See Nasdaq ISE, Options Rules, Options 7, Pricing Schedule,
Section 11.D. (charging $3,000 for disaster recovery testing &
relocation services); see also Cboe Exchange, Inc. (``Cboe'') Fees
Schedule, p. 14, Cboe Command Connectivity Charges (charging a
monthly fee of $2,000 for a 1Gb disaster recovery network access
port and a monthly fee of $6,000 for a 10Gb disaster recovery
network access port).
---------------------------------------------------------------------------

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

    MIAX Emerald does not believe that the proposed rule changes will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. In particular, the Exchange has
received no official comment letters or complaints from Members or
others who connect to it that its Proposed Fees are negatively
impacting or would negatively impact their abilities to compete with
other market participants. Further, the Exchange is unaware of any
assertion that its Proposed Fees would somehow unduly impair its
competition with other options exchanges. To the contrary, if the fees
charged are deemed too high by market participants, they can simply
disconnect.
    While the Exchange recognizes the distinction between connecting to
an exchange and trading at the exchange, the Exchange notes that it
operates in a highly competitive options market in which market
participants can readily connect and trade with venues they desire. In
such an environment, the Exchange must continually adjust its fees to
remain competitive with other exchanges. The Exchange believes that the
proposed changes reflect this competitive environment.

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

    Written comments were neither solicited nor received.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\28\ and Rule 19b-4(f)(2) \29\ thereunder.
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. If the Commission takes such
action, the Commission shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
---------------------------------------------------------------------------

    \28\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \29\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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_ADDRESS>Please include
File Number SR-EMERALD-2019-20 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-EMERALD-2019-20. 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 website (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 website 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. 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-EMERALD-2019-20 and should be submitted
on or before June 6, 2019.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\30\
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    \30\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-10118 Filed 5-15-19; 8:45 am]
 BILLING CODE 8011-01-P