[Federal Register Volume 81, Number 231 (Thursday, December 1, 2016)]
[Notices]
[Pages 86713-86714]
[FR Doc No: 2016-28878]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OPPT-2016-0658; FRL-9955-38]

New Chemicals Review Program Under the Amended Toxic Substances
Control Act; Notice of Public Meeting and Opportunity for Public
Comment

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

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SUMMARY: EPA is holding a meeting to update the public on changes to
the New Chemicals Review Program under the Toxic Substances Control Act
as amended by the Frank R. Lautenberg Chemical Safety for the 21st
Century Act (TSCA). EPA will describe its review process for new
chemicals under the amended statute, as well as discuss issues,
challenges, and opportunities that the Agency has identified in the
first few months of implementation. The meeting will provide interested
parties with an opportunity to provide input on their experiences with
the New Chemicals Review Program, including submittal of pre-
manufacture notices (PMNs), microbial commercial activities notices
(MCANs), and significant new use notices (SNUNs) under section 5 of the
law. Information obtained during these meetings will be considered as
the Agency works to implement the new requirements and increase
efficiency in its review process under TSCA.

DATES: The meeting will be held on December 14, 2016 from 9:00 a.m. to
3:00 p.m. Requests to participate in the meeting must be received on or
before December 13, 2016. On-site registration will be permitted, but
seating and speaking priority will be given to those who pre-register
by the deadline.
    To request accommodation of a disability, please contact the
meeting logistics person listed under FOR FURTHER INFORMATON CONTACT,
preferably at least 10 days prior to the meeting, to give EPA as much
time as possible to process your request.
    EPA will hear oral comments at the meeting, and will accept written
comments and materials submitted to the docket on or before January 14,
2016.

ADDRESSES: The meeting will be held at The Ronald Reagan Building and
International Trade Center, Polaris Room, 1300 Pennsylvania Avenue
Northwest, Washington, DC 20004. The meetings will also be available by
remote access for registered participants. For further information, see
Unit III.A. under SUPPLEMENTARY INFORMATION.
    To participate in the meeting, identified by docket identification
(ID) number EPA-HQ-OPPT-2016-0658, you may register online (preferred)
or in person at the meeting. To register online, for the meeting, go to
https://tscanewchemicals.eventbrite.com.
    Written comments, identified by the docket ID number, EPA-HQ-OPPT-
2016-0658, can be submitted by one of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov.
Follow the online instructions for submitting comments. Do not submit
electronically any information you consider to be Confidential Business
Information (CBI) or other information whose disclosure is restricted
by statute.
     Mail: Document Control Office (7407M), Office of Pollution
Prevention and Toxics (OPPT), Environmental Protection Agency, 1200
Pennsylvania Ave. NW., Washington, DC 20460-0001.
     Hand Delivery: To make special arrangements for hand
delivery or delivery of boxed information, please follow the
instructions at http://www.epa.gov/dockets/contacts.html.
    Additional instructions on commenting or visiting the docket, along
with more information about dockets in general is available at http://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT:
    For technical information contact: Greg Schweer, Chemical Control
Division (7405M), Office of Pollution Prevention and Toxics,
Environmental Protection Agency, 1200 Pennsylvania Ave. NW.,
Washington, DC 20460-0001; telephone number:<PHONE_NUMBER>; email
address<EMAIL_ADDRESS>    For meeting logistics or registration contact: Klara Zimmerman, Abt
Associates; telephone number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>    For general information contact: The TSCA-Hotline, ABVI-Goodwill,
422 South Clinton Ave., Rochester, NY 14620; telephone number: (202)
554-1404; email address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    This action is directed to the public in general, and may be of
interest to a wide range of stakeholders including chemical
manufacturers, processors and users, consumer product companies, non-
profit organizations in the environmental and public health sectors,
state and local government agencies, and members of the public
interested in the environmental and human health assessment and
regulation of chemical substances. Since others also may be interested,
the Agency has not attempted to describe all the specific entities that
may be affected by this action.

B. How can I get copies of this document and other related information?

    The docket for this action, identified by docket ID number EPA-HQ-
OPPT-2016-0658, is available at http://www.regulations.gov or at the
Office of Pollution Prevention and Toxics Docket (OPPT Docket),
Environmental Protection Agency Docket Center (EPA/DC), West William
Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW.,
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30
p.m., Monday through Friday, excluding legal holidays. The telephone
number for the Public Reading Room is<PHONE_NUMBER>, and the telephone
number for the OPPT Docket is<PHONE_NUMBER>. Please review the visitor
instructions and additional information about the docket available at
http://www.epa.gov/dockets. Documents and meeting information will also
be available at the registration Web site and on EPA's new chemicals
Web site at https://www.epa.gov/reviewing-new-chemicals-under-toxic-substances-control-act-tsca.

II. Background

    On June 22, 2016, President Obama signed into law the Frank R.
Lautenberg Chemical Safety for the 21st Century Act, which amended the
TSCA Act of 1976. A number of statutory changes have enhanced the EPA's
authority to evaluate chemicals and make determinations regarding their
unreasonable risk to health and the environment prior to
commercialization. Specifically, under section 5 of the amended TSCA,
there are new requirements and additional determinations that EPA must
make. These requirements provide EPA new authority to review and
determine risk associated with the manufacturing and processing of new
chemicals.
    Background on EPA's New Chemicals Review Program. EPA's New
Chemicals Review Program has and will continue to help manage the
potential risk to human health and the environment from chemicals new
to the marketplace. The program functions as a ``gatekeeper'' that can
identify conditions, up to and including a ban on production, to be
placed on the use of a new chemical before it is entered into commerce.
Under section 5 of TSCA, anyone who plans to manufacture (including
import) a new

chemical substance for a non-exempt commercial purpose, is required to
provide EPA with notice before initiating the activity. Additionally,
EPA must also be notified before chemical substances are used in new
significant uses. Pursuant to the amended law, EPA is now required to
make an affirmative determination as to whether or not the new use or
new chemical presents, may present, or is not likely to present an
unreasonable risk of injury to health or the environment, or,
alternatively, if there is insufficient information to allow for a
determination. This amendment went into effect immediately after the
law was signed by the President and has resulted in significant changes
for both the EPA's New Chemicals Review Program and those manufacturers
submitting notices, including manufacturers of the notices under review
on June 22, 2016. EPA has worked to keep manufacturers informed of
these changes and hopes to continue this dialogue during this public
meeting.
    Additional information on the revisions to TSCA can be found at
https://www.epa.gov/assessing-and-managing-chemicals-under-tsca/frank-r-lautenberg-chemical-safety-21st-century-act.

III. Meeting

A. Remote Access

    The meetings will be accessible remotely for registered
participants. Registered participants will receive information on how
to connect to the meetings prior to their start.

B. Public Participation at the Meeting

    Members of the public may register to attend the meeting as
observers and may also register to provide oral comments on the day of
the meeting. A registered speaker is encouraged to focus on issues
directly relevant to the meeting's subject matter. Each speaker is
allowed no more than 5 minutes to provide oral comments. To accommodate
as many registered speakers as possible, speakers may present oral
comments only, without visual aids or written material. Persons
registered to speak (as well as others) may submit written materials to
the docket as described under ADDRESSES.

IV. How can I request to participate in this meeting?

A. Registration

    To attend the meeting in person or to receive remote access, you
must register no later than December 13, 2016, using one of the methods
described under ADDRESSES. While on-site registration will be
available, seating will be on a first-come, first-served basis, with
priority given to early registrants, until room capacity is reached.
The Agency anticipates that approximately 125 people will be able to
attend the meeting in person. For registrants not able to attend in
person, the meeting will also provide remote access capabilities;
registered participants will be provided information on how to connect
to the meeting prior to its start.

B. Required Registration Information

    Members of the public may register to attend as observers or speak
if planning to offer oral comments during the scheduled public comment
period. To register for the meeting online, you must provide your full
name, organization or affiliation, and contact information.

    Authority: 15 U.S.C.2601 et seq.

    Dated: November 21, 2016.
Maria J. Doa,
Director, Chemical Control Division, Office of Pollution Prevention and
Toxics.
[FR Doc. 2016-28878 Filed 11-30-16; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register Volume 87, Number 29 (Friday, February 11, 2022)]
[Rules and Regulations]
[Pages 7953-7955]
[FR Doc No: 2022-02905]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 180

[EPA-HQ-OPP-2020-0737; FRL-9094-01-OCSPP]

Bacillus paralicheniformis Strain CH2970; Exemption From the
Requirement of a Tolerance

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This regulation establishes an exemption from the requirement
of a tolerance for residues of Bacillus paralicheniformis strain CH2970
in or on all food commodities when used in accordance with label
directions and good agricultural practices. Chr. Hansens Laboratory
Inc. submitted a petition to EPA under the Federal Food, Drug, and
Cosmetic Act (FFDCA), requesting an exemption from the requirement of a
tolerance. This regulation eliminates the need to establish a maximum
permissible level for residues of Bacillus paralicheniformis strain
CH2970 under FFDCA when used in accordance with this exemption.

DATES: This regulation is effective February 11, 2022. Objections and
requests for hearings must be received on or before April 12, 2022 and
must be filed in accordance with the instructions provided in 40 CFR
part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

ADDRESSES: The docket for this action, identified by docket
identification (ID) number EPA-HQ-OPP-2020-0737, is available at
https://www.regulations.gov or at the Office of Pesticide Programs
Regulatory Public Docket (OPP Docket) in the Environmental Protection
Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg.,
Rm. 3334, 1301 Constitution Ave. NW, Washington, DC 20460-0001. The
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is<PHONE_NUMBER>, and the telephone number for the OPP
Docket is<PHONE_NUMBER>.
    Due to the public health concerns related to COVID-19, the EPA
Docket Center (EPA/DC) and Public Reading Room are closed to visitors
with limited exceptions. The staff continues to provide remote customer
service via email, phone, and webform. For the latest status
information on EPA/DC services and docket access, visit https://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT: Charles Smith, Biopesticides and
Pollution Prevention Division (7511P), Office of Pesticide Programs,
Environmental Protection Agency, 1200 Pennsylvania Ave. NW, Washington,
DC 20460-0001; main telephone number:<PHONE_NUMBER>; email address:
[email protected].

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    You may be potentially affected by this action if you are an
agricultural producer, food manufacturer, or pesticide manufacturer.
The following list of North American Industrial Classification System
(NAICS) codes is not intended to be exhaustive, but rather provides a
guide to help readers determine whether this document applies to them.
Potentially affected entities may include:
     Crop production (NAICS code 111).
     Animal production (NAICS code 112).
     Food manufacturing (NAICS code 311).
     Pesticide manufacturing (NAICS code 32532).

B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of 40 CFR
part 180 through the Office of the Federal Register's e-CFR site at
https://www.ecfr.gov/current/title-40.

C. How can I file an objection or hearing request?

    Under FFDCA section 408(g), 21 U.S.C. 346a(g), any person may file
an objection to any aspect of this regulation and may also request a
hearing on those objections. You must file your objection or request a
hearing on this regulation in accordance with the instructions provided
in 40 CFR part 178. To ensure proper receipt by EPA, you must identify
docket ID number EPA-HQ-OPP-2020-0737 in the subject line on the first
page of your submission. All objections and requests for a hearing must
be in writing and must be received by the Hearing Clerk on or before
April 12, 2022. Addresses for mail and hand delivery of objections and
hearing requests are provided in 40 CFR 178.25(b), although EPA
strongly encourages those interested in submitting objections or a
hearing request to submit objections and hearing requests
electronically. See Order Urging Electronic Service and Filing (April
10, 2020), https://www.epa.gov/sites/production/files/2020-05/documents/2020-04-10_-_order_urging_electronic_service_and_filing.pdf.
At this time, because of the COVID-19 pandemic, the judges and staff of
the Office of Administrative Law Judges are working remotely and not
able to accept filings or correspondence by courier, personal delivery,
or commercial delivery, and the ability to receive filings or
correspondence by U.S. Mail is similarly limited. When submitting
documents to the U.S. EPA Office of Administrative Law Judges (OALJ), a
person should utilize the OALJ e-filing system at https://yosemite.epa.gov/OA/EAB/EAB-ALJ_upload.nsf.
    Although EPA's regulations require submission via U.S. Mail or hand
delivery, EPA intends to treat submissions filed via electronic means
as properly filed submissions during this time that the Agency
continues to maximize telework due to the

pandemic; therefore, EPA believes the preference for submission via
electronic means will not be prejudicial. If it is impossible for a
person to submit documents electronically or receive service
electronically, e.g., the person does not have any access to a
computer, the person shall so advise OALJ by contacting the Hearing
Clerk at<PHONE_NUMBER>. If a person is without access to a computer
and must file documents by U.S. Mail, the person shall notify the
Hearing Clerk every time it files a document in such a manner. The
address for mailing documents is U.S. Environmental Protection Agency,
Office of Administrative Law Judges, Mail Code 1900R, 1200 Pennsylvania
Ave. NW, Washington, DC 20460.
    In addition to filing an objection or hearing request with the
Hearing Clerk as described in 40 CFR part 178, please submit a copy of
the filing (excluding any Confidential Business Information (CBI)) for
inclusion in the public docket. Information not marked confidential
pursuant to 40 CFR part 2 may be disclosed publicly by EPA without
prior notice. Submit the non-CBI copy of your objection or hearing
request, identified by docket ID number EPA-HQ-OPP-2020-0737, by one of
the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the online instructions for submitting comments. Do not submit
electronically any information you consider to be CBI or other
information whose disclosure is restricted by statute.
     Mail: OPP Docket, Environmental Protection Agency Docket
Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW, Washington, DC
20460-0001.
     Hand Delivery: To make special arrangements for hand
delivery or delivery of boxed information, please follow the
instructions at https://www.epa.gov/dockets/where-send-comments-epa-dockets.
    Additional instructions on commenting or visiting the docket, along
with more information about dockets generally, is available at https://www.epa.gov/dockets.

II. Background

    In the Federal Register of March 22, 2021 (86 FR 15162) (FRL-10021-
44), EPA issued a notice pursuant to FFDCA section 408(d)(3), 21 U.S.C.
346a(d)(3), announcing the filing of a pesticide tolerance exemption
petition (PP 0F8843) by Chr. Hansens Laboratory Inc., 9015 W Maple St.,
Milwaukee, WI 53214. The petition requested that 40 CFR part 180 be
amended by establishing an exemption from the requirement of a
tolerance for residues of the fungicide and nematicide Bacillus
paralicheniformis strain CH2970 in or on all food commodities. That
notice referenced a summary of the petition prepared by the petitioner
Chr. Hansens Laboratory Inc. and available in the docket via https://www.regulations.gov. No comments were received on the notice of filing.

III. Final Rule

A. EPA's Safety Determination

    Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an
exemption from the requirement of a tolerance (the legal limit for a
pesticide chemical residue in or on a food) only if EPA determines that
the exemption is ``safe.'' Section 408(c)(2)(A)(ii) of FFDCA defines
``safe'' to mean that ``there is a reasonable certainty that no harm
will result from aggregate exposure to the pesticide chemical residue,
including all anticipated dietary exposures and all other exposures for
which there is reliable information.'' This includes exposure through
drinking water and in residential settings but does not include
occupational exposure. Pursuant to FFDCA section 408(c)(2)(B), in
establishing or maintaining in effect an exemption from the requirement
of a tolerance, EPA must take into account the factors set forth in
FFDCA section 408(b)(2)(C), which require EPA to give special
consideration to exposure of infants and children to the pesticide
chemical residue in establishing a tolerance or tolerance exemption and
to ``ensure that there is a reasonable certainty that no harm will
result to infants and children from aggregate exposure to the pesticide
chemical residue. . . .'' Additionally, FFDCA section 408(b)(2)(D)
requires that EPA consider ``available information concerning the
cumulative effects of [a particular pesticide's] . . . residues and
other substances that have a common mechanism of toxicity.''
    EPA evaluated the available toxicological and exposure data on
Bacillus paralicheniformis strain CH2970 and considered their validity,
completeness, and reliability, as well as the relationship of this
information to human risk. A full explanation of the data upon which
EPA relied and its risk assessment based on those data can be found
within the document entitled ``Human Health Risk Assessment of Bacillus
paralicheniformis strain CH2970 and Bacillus subtilis strain CH3000,
New Active Ingredients, in CH2970, CH3000, and CH2970/CH3000 Proposed
for Registration and Associated Petitions Requesting Tolerance
Exemptions'' (Bacillus paralicheniformis strain CH2970 and Bacillus
subtilis strain CH3000 Human Health Assessment). This document, as well
as other relevant information, is available in the docket for this
action as described under ADDRESSES.
    The available data and rationale demonstrated that, with regard to
humans, Bacillus paralicheniformis strain CH2970 is not toxic,
pathogenic, or infective via the pulmonary route of exposure when
administered intratracheally at a single dose of 6.3 x 10\8\ colony-
forming units per test animal; is not anticipated to be toxic,
pathogenic, or infective via the oral route of exposure; and is not
anticipated to be toxic or irritating via the dermal route of exposure.
Additionally, the acute pulmonary toxicity/pathogenicity study
demonstrated a pattern of clearance of Bacillus paralicheniformis
strain CH2970 from the blood, cecum contents, and organs of the test
animals. Although there may be minimal dietary exposure to residues of
Bacillus paralicheniformis strain CH2970 when used in accordance with
label directions and good agricultural practices, there are no risks of
human health concern due to the lack of potential for adverse effects.
There are no current or proposed uses of Bacillus paralicheniformis
strain CH2970 that would result in non-occupational exposures. Because
there are no threshold levels of concern with the toxicity,
pathogenicity, or infectivity of Bacillus paralicheniformis strain
CH2970, EPA determined that no additional margin of safety is necessary
to protect infants and children as part of the qualitative assessment
conducted. Based upon its evaluation in the Bacillus paralicheniformis
strain CH2970 and Bacillus subtilis strain CH3000 Human Health
Assessment, which concludes that there are no risks of concern from
aggregate exposure to Bacillus paralicheniformis strain CH2970, EPA
concludes that there is a reasonable certainty that no harm will result
to the U.S. population, including infants and children, from aggregate
exposure to residues of Bacillus paralicheniformis strain CH2970.

B. Analytical Enforcement Methodology

    An analytical method for detecting and measuring pesticide residues
is not needed for Bacillus paralicheniformis strain CH2970 due to the
lack of potential for adverse effects, which supports the establishment
of the exemption from the requirement of a tolerance without any
numerical limitation.

C. Conclusion

    Therefore, an exemption from the requirement of a tolerance is
established for residues of Bacillus paralicheniformis strain CH2970 in
or on all food commodities when used in accordance with label
directions and good agricultural practices.

IV. Statutory and Executive Order Reviews

    This action establishes a tolerance exemption under FFDCA section
408(d) in response to a petition submitted to EPA. The Office of
Management and Budget (OMB) has exempted these types of actions from
review under Executive Order 12866, entitled ``Regulatory Planning and
Review'' (58 FR 51735, October 4, 1993). Because this action has been
exempted from review under Executive Order 12866, this action is not
subject to Executive Order 13211, entitled ``Actions Concerning
Regulations That Significantly Affect Energy Supply, Distribution, or
Use'' (66 FR 28355, May 22, 2001), or Executive Order 13045, entitled
``Protection of Children from Environmental Health Risks and Safety
Risks'' (62 FR 19885, April 23, 1997). This action does not contain any
information collections subject to OMB approval under the Paperwork
Reduction Act, 44 U.S.C. 3501 et seq., nor does it require any special
considerations under Executive Order 12898, entitled ``Federal Actions
to Address Environmental Justice in Minority Populations and Low-Income
Populations'' (59 FR 7629, February 16, 1994).
    Since tolerances and exemptions that are established on the basis
of a petition under FFDCA section 408(d), such as the tolerance
exemption in this action, do not require the issuance of a proposed
rule, the requirements of the Regulatory Flexibility Act (5 U.S.C. 601
et seq.) do not apply.
    This action directly regulates growers, food processors, food
handlers, and food retailers, not States or Tribes. As a result, this
action does not alter the relationships or distribution of power and
responsibilities established by Congress in the preemption provisions
of FFDCA section 408(n)(4). As such, EPA has determined that this
action will not have a substantial direct effect on States or Tribal
Governments, on the relationship between the National Government and
the States or Tribal Governments, or on the distribution of power and
responsibilities among the various levels of government or between the
Federal Government and Indian Tribes. Thus, EPA has determined that
Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 10,
1999), and Executive Order 13175, entitled ``Consultation and
Coordination with Indian Tribal Governments'' (65 FR 67249, November 9,
2000), do not apply to this action. In addition, this action does not
impose any enforceable duty or contain any unfunded mandate as
described under Title II of the Unfunded Mandates Reform Act (2 U.S.C.
1501 et seq.).
    This action does not involve any technical standards that would
require EPA's consideration of voluntary consensus standards pursuant
to section 12(d) of the National Technology Transfer and Advancement
Act (15 U.S.C. 272 note).

V. Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
EPA will submit a report containing this rule and other required
information to the U.S. Senate, the U.S. House of Representatives, and
the Comptroller General of the United States prior to publication of
the rule in the Federal Register. This action is not a ``major rule''
as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure,
Agricultural commodities, Pesticides and pests, Reporting and
recordkeeping requirements.

    Dated: February 4, 2022.
Edward Messina,
Director, Office of Pesticide Programs.

    Therefore, for the reasons stated in the preamble, EPA is amending
40 CFR chapter I as follows:

PART 180--TOLERANCES AND EXEMPTIONS FOR PESTICIDE CHEMICAL RESIDUES
IN FOOD

0
1. The authority citation for part 180 continues to read as follows:

    Authority: 21 U.S.C. 321(q), 346a and 371.

0
2. Add Sec.  180.1389 to subpart D to read as follows:

Sec.  180.1389  Bacillus paralicheniformis strain CH2970; exemption
from the requirement of a tolerance.

    An exemption from the requirement of a tolerance is established for
residues of Bacillus paralicheniformis strain CH2970 in or on all food
commodities when used in accordance with label directions and good
agricultural practices.

[FR Doc. 2022-02905 Filed 2-10-22; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register Volume 84, Number 234 (Thursday, December 5, 2019)]
[Rules and Regulations]
[Pages 66612-66616]
[FR Doc No: 2019-26136]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-HQ-OAR-2019-0603; FRL-10002-78-OAR]

Findings of Failure To Submit a Clean Air Act Section 110 State
Implementation Plan for Interstate Transport for the 2015 Ozone
National Ambient Air Quality Standards (NAAQS)

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final action.

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SUMMARY: The Environmental Protection Agency (EPA) is taking final
action finding that seven states have failed to submit infrastructure
State Implementation Plans (SIPs) to satisfy certain interstate
transport requirements of the Clean Air Act (CAA) with respect to the
2015 8-hour ozone national ambient air quality standards (NAAQS).
Specifically, these requirements pertain to prohibiting significant
contribution to nonattainment, or interference with maintenance, of the
2015 8-hour ozone NAAQS in other states. These findings of failure to
submit establish a 2-year deadline for the EPA to promulgate Federal
Implementation Plans (FIPs) to address these interstate transport
requirements for a given state unless, prior to the EPA promulgating a
FIP, the state submits, and the EPA approves, a SIP that meets these
requirements.

DATES: Effective date of this action is January 6, 2020.

FOR FURTHER INFORMATION CONTACT: General questions concerning this
document should be addressed to Mr. Thomas Uher, Office of Air Quality
Planning and Standards, Air Quality Policy Division, Mail Code C539-04,
109 TW Alexander Drive, Research Triangle Park, NC 27711; telephone
(919) 541-5534; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Notice and Comment Under the Administrative Procedures Act (APA)

    Section 553 of the APA, 5 U.S.C. 553(b)(3)(B), provides that, when
an agency for good cause finds that notice and public procedure are
impracticable, unnecessary, or contrary to the public interest, the
agency may issue a rule without providing notice and an opportunity for
public comment. The EPA has determined that there is good cause for
making this final agency action without prior proposal and opportunity
for comment because no significant EPA judgment is involved in making a
finding of failure to submit SIPs, or elements of SIPs, required by the
CAA, where states have made no submissions or incomplete submissions,
to meet the requirement. Thus, notice and public procedure are
unnecessary. The EPA finds that this constitutes good cause under 5
U.S.C. 553(b)(3)(B).

B. How can I get copies of this document and other related information?

    The EPA has established a docket for this action under Docket ID
No. EPA-HQ-OAR-2019-0603. All documents in the docket are listed and
publicly available at http://www.regulations.gov. Publicly available
docket materials are also available in hard copy at the Air and
Radiation Docket and Information

Center, EPA/DC, William Jefferson Clinton West Building, Room 3334,
1301 Constitution Avenue NW, Washington, DC. The Public Reading Room is
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding
legal holidays. The telephone number for the Public Reading Room is
(202) 566-1744 and the telephone number for the Office of Air and
Radiation Docket and Information Center is<PHONE_NUMBER>. For
additional information about the EPA's public docket, visit the EPA
Docket Center homepage at: http://www.epa.gov/epahome/dockets.htm.

C. How is the preamble organized?

Table of Contents

I. General Information
    A. Notice and Comment Under the Administrative Procedures Act
(APA)
    B. How can I get copies of this document and other related
information?
    C. How is the preamble organized?
    D. Where do I go if I have state specific questions?
II. Background and Overview
    A. Interstate Transport SIPs
    B. Background on 2015 Ozone NAAQS and Related Matters
III. Findings of Failure To Submit for States That Failed To Make an
Interstate Transport SIP Submission for the 2015 Ozone NAAQS
IV. Environmental Justice Considerations
V. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Executive
Order 13563: Improving Regulation and Regulatory Review
    B. Executive Order 13771: Reducing Regulations and Controlling
Regulatory Costs
    C. Paperwork Reduction Act (PRA)
    D. Regulatory Flexibility Act (RFA)
    E. Unfunded Mandates Reform Act of 1995 (UMRA)
    F. Executive Order 13132: Federalism
    G. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    H. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks.
    I. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution or Use
    J. National Technology Transfer and Advancement Act (NTTAA)
    K. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority and Low Income Populations
    L. Congressional Review Act
    M. Judicial Review

D. Where do I go if I have state specific questions?

    The table below lists the states that failed to make a complete
interstate transport SIP submittal addressing CAA section
110(a)(2)(D)(i)(I) requirements for the 2015 ozone NAAQS. For questions
related to specific states mentioned in this document, please contact
the appropriate EPA Regional office:

------------------------------------------------------------------------
               Regional offices                          States
------------------------------------------------------------------------
EPA Region 1: Alison Simcox, Manager, Air      Maine, Rhode Island.
 Quality Branch, EPA Region I, 5 Post Office
 Square, Suite 100, Boston, MA 02109-3912.
EPA Region 3: Joseph Schulingkamp, Air         Pennsylvania, Virginia.
 Protection Division, EPA Region III, 1650
 Arch Street, Philadelphia, PA 19103-2187.
EPA Region 6: Mary Stanton, Chief,             New Mexico.
 Infrastructure and Ozone Section, EPA Region
 VI, 1201 Elm Street, Suite 500, Dallas, TX
 75270.
EPA Region 8: Adam Clark, EPA Region VIII,     South Dakota, Utah.
 Air and Radiation Division, 1595 Wynkoop
 St., Denver, CO 80202.
------------------------------------------------------------------------

II. Background and Overview

A. Interstate Transport SIPs

    CAA section 110(a) imposes an obligation upon states to submit SIPs
that provide for the implementation, maintenance, and enforcement of a
new or revised NAAQS within 3 years following the promulgation of that
NAAQS. CAA section 110(a)(2) lists specific requirements that states
must meet in these SIP submissions, as applicable. The EPA refers to
this type of SIP submission as an ``infrastructure'' SIP because it
ensures that states can implement, maintain and enforce the new or
revised air standards. Within these requirements, CAA section
110(a)(2)(D)(i) contains requirements to address interstate transport
of NAAQS pollutants. A SIP revision submitted for this sub-section is
referred to as an ``interstate transport SIP.'' In turn, CAA section
110(a)(2)(D)(i)(I) requires that such a plan contain adequate
provisions to prohibit emissions from the state that will contribute
significantly to nonattainment of the NAAQS in any other state (``prong
1'') or interfere with maintenance of the NAAQS in any other state
(``prong 2''). Interstate transport prongs 1 and 2, also called
collectively the ``good neighbor'' provision, are the requirements
relevant to this findings document.
    Pursuant to CAA section 110(k)(1)(B), the EPA must determine no
later than 6 months after the date by which a state is required to
submit a SIP whether a state has made a submission that meets the
minimum completeness criteria established pursuant to CAA section
110(k)(1)(A). These criteria are set forth at 40 CFR part 51, appendix
V. The EPA refers to the determination that a state has not submitted a
SIP submission that meets the minimum completeness criteria as a
``finding of failure to submit.'' If the EPA finds a state has failed
to submit a SIP to meet its statutory obligation to address CAA section
110(a)(2)(D)(i)(I), then pursuant to CAA section 110(c)(1), the EPA has
not only the authority, but the obligation, to promulgate a FIP within
2 years to address the CAA requirement. This finding, therefore, starts
a 2-year ``clock'' for promulgation by the EPA of a FIP, in accordance
with CAA section 110(c)(1), unless prior to such promulgation the state
submits, and the EPA approves, a submittal from the state to meet the
requirements of CAA section 110(a)(2)(D)(i)(I). Even where the EPA has
promulgated a FIP, the EPA will withdraw that FIP if a state submits
and the EPA approves a SIP satisfying the relevant requirements. The
EPA notes this action does not start a mandatory sanctions clock
pursuant to CAA section 179 because this finding of failure to submit
does not pertain to a part D plan for nonattainment areas required
under CAA section 110(a)(2)(I) or a SIP call pursuant to CAA section
110(k)(5).

B. Background on 2015 Ozone NAAQS and Related Matters

    On October 1, 2015, the EPA promulgated a new 8-hour primary and
secondary ozone NAAQS of 70 parts per billion (ppb), which is met when
the 3-year average of the annual fourth highest daily maximum 8-hour
concentration does not exceed 70 ppb.\1\ Pursuant to the 3-year period
provided in CAA section 110(a)(1), infrastructure SIPs addressing the
revised standard were due on October 1, 2018.
---------------------------------------------------------------------------

    \1\ See Final Rule, National Ambient Air Quality Standards for
Ozone, 80 FR 65292 (October 26, 2015).
---------------------------------------------------------------------------

    On September 5, 2019, the EPA announced via its website its
intention to make findings that certain states have failed to submit
complete interstate

transport SIPs for the 2015 ozone NAAQS by November 22, 2019.\2\
---------------------------------------------------------------------------

    \2\ U.S. EPA, Interstate Air Pollution Transport, https://www.epa.gov/airmarkets/interstate-air-pollution-transport.
---------------------------------------------------------------------------

    On September 30, 2019, the Sierra Club filed a complaint in the
United States District Court for the District of Columbia (D.C.
District Court) alleging that the EPA had not fulfilled its mandatory
duty to make findings of failure to submit interstate transport SIPs
pursuant to CAA section 110(a)(2)(D)(i)(I) with respect to the 2015
ozone NAAQS for twelve states: Arkansas, Hawaii, Louisiana, Maine,
Maryland, Mississippi, New Mexico, Pennsylvania, Rhode Island, Utah,
Vermont, and Virginia.\3\ On October 29, 2019, the States of New Jersey
and Connecticut filed a complaint in the D.C. District Court alleging
that the EPA had not fulfilled its mandatory duty to make findings of
failure to submit interstate transport SIPs addressing interstate
transport in CAA section 110(a)(2)(D)(i)(I) with respect to the 2015
ozone NAAQS for two states: Virginia and Pennsylvania.\4\
---------------------------------------------------------------------------

    \3\ Complaint, Sierra Club v. Wheeler, No. 1:19-cv-02923 (D.D.C.
filed Sept. 30, 2019).
    \4\ Complaint, State of New Jersey v. Wheeler, No. 1:19-cv-03247
(D.D.C. filed Oct. 29, 2019).
---------------------------------------------------------------------------

    To fulfill its statutory obligations, the EPA is taking this action
for all states that have failed to submit complete SIPs addressing CAA
section 110(a)(2)(D)(i)(I) for the 2015 ozone NAAQS, not just those
states named in the complaints. As explained below, in total, seven
states have failed to submit complete SIPs while forty-three states and
the District of Columbia have submitted complete SIPs addressing CAA
section 110(a)(2)(D)(i)(I) for the 2015 ozone NAAQS.
    The EPA has included in the docket for this action its
correspondence with states regarding the completeness of their SIP
submissions. SIPs may be considered complete by either of two methods.
First, the EPA may make a determination that a SIP is complete under
the ``completeness criteria'' set out at 40 CFR part 51, appendix V.
See CAA section 110(k)(1). Second, a SIP may be deemed complete by
operation of law if the EPA has failed to make such a determination by
6 months after receipt of the SIP submission. See CAA section
110(k)(1)(B).
    Five states failed to make any SIP submittal addressing interstate
transport for the 2015 ozone NAAQS: Maine, New Mexico, Pennsylvania,
Rhode Island, and Virginia. All of these states were identified in the
Sierra Club complaint.
    The EPA has evaluated the SIP submittals of two states, South
Dakota and Utah, for completeness pursuant to the criteria in 40 CFR
part 51, appendix V, and concluded that these are incomplete SIP
submissions.\5\ On November 21, 2019, the EPA sent letters to these two
states explaining our incompleteness determination. These letters are
included in the docket for this action. As explained in those letters,
the completeness criteria under 40 CFR part 51, appendix V, section
2.1(g), require a certification that public hearing(s) were held in
accordance with the information provided in the state's public notice
and the State's laws and constitution, if applicable and consistent
with the public hearing requirements in 40 CFR 51.102. Under Sec.
51.102(a), states must either hold a public hearing or provide the
public the opportunity to request a public hearing. South Dakota and
Utah did not provide the necessary certification under section 2.1(g)
of appendix V that a public hearing was held or that they had provided
the opportunity for the public to request a public hearing in
accordance with 40 CFR 51.102(a). As a result, the EPA determined that
these SIP submissions are incomplete. Where the EPA determines that a
SIP submission does not meet the appendix V completeness criteria,
``the State shall be treated as not having made the submission. . . .''
CAA section 110(k)(1)(C). Accordingly, the EPA is finding in this
document that South Dakota and Utah have failed to submit complete SIP
revisions addressing CAA section 110(a)(2)(D)(i)(I) as to the 2015
ozone NAAQS. These states may, if they choose, resubmit to the EPA
complete SIPs, which the EPA will review and act upon at a later date.
---------------------------------------------------------------------------

    \5\ Utah was identified in the Sierra Club complaint, but South
Dakota was not.
---------------------------------------------------------------------------

    In all other cases, the EPA has determined that the SIP submittals
are complete or they have been deemed complete by operation of law. In
particular, the six remaining states identified in Sierra Club's
complaint filed in the D.C. District Court have made complete SIP
submittals addressing the good neighbor provision for the 2015 ozone
NAAQS: Arkansas, Hawaii, Louisiana, Maryland, Mississippi, and Vermont.
As a result, there is no longer a basis to make findings of failure to
submit for these states.
    The EPA is issuing national findings of failure to submit
interstate transport SIPs addressing the requirements of CAA section
110(a)(2)(D)(i)(I) as to the 2015 ozone NAAQS, for all states that have
not made complete submissions as of the date of this document.

III. Findings of Failure To Submit for States That Failed To Make an
Interstate Transport SIP Submission for the 2015 Ozone NAAQS

    The EPA is making findings of failure to submit for seven states.
The EPA finds the following states have not submitted complete
interstate transport SIPs to meet the requirements of CAA section
110(a)(2)(D)(i)(I) for the 2015 ozone NAAQS: Maine, New Mexico,
Pennsylvania, Rhode Island, South Dakota, Utah, and Virginia.
Notwithstanding these findings, and the associated obligation of the
EPA to promulgate FIPs for these states within two years of this
finding, the EPA intends to continue to work with states subject to
these findings in order to provide assistance as necessary to help them
develop approvable SIP submittals in a timely manner.

IV. Environmental Justice Considerations

    This document is making a procedural finding that certain states
have failed to submit a SIP to address CAA section 110(a)(2)(D)(i)(I)
for the 2015 ozone NAAQS. The EPA did not conduct an environmental
analysis for this action because it would not directly affect the air
emissions of particular sources. Because this action will not directly
affect the air emissions of particular sources, it does not affect the
level of protection provided to human health or the environment.
Therefore, this action will not have potential disproportionately high
and adverse human health or environmental effects on minority, low-
income or indigenous populations.

V. Statutory and Executive Order Reviews

A. Executive Orders 12866: Regulatory Planning and Executive Order
13563: Improving Regulation and Regulatory Review

    This action is not a significant regulatory action and was,
therefore, not submitted to the Office of Management and Budget (OMB)
for review.

B. Executive Order 13771: Reducing Regulations and Controlling
Regulatory Costs

    This action is not an Executive Order 13771 regulatory action
because it finds that seven states failed to submit a SIP to meet their
statutory obligation to address CAA section 110(a)(2)(D)(i)(I) for the
2015 ozone NAAQS.

C. Paperwork Reduction Act

    This action does not impose an information collection burden under
the

provisions of the Paperwork Reduction Act. This final action does not
establish any new information collection requirement apart from what is
already required by law. This finding relates to the requirement in the
CAA for states to submit SIPs under section 110(a)(2)(D)(i)(I) of the
CAA for the 2015 ozone NAAQS.

D. Regulatory Flexibility Act (RFA)

    This action is not subject to the RFA. The RFA applies only to
rules subject to notice and comment rulemaking requirements under the
Administrative Procedure Act (APA), 5 U.S.C. 553 or any other statute.
This action is not subject to notice and comment requirements because
the agency has invoked the APA ``good cause'' exemption under 5 U.S.C.
553(b). I certify that this action will not have a significant economic
impact on a substantial number of small entities under the RFA. This
action will not impose any requirements on small entities. The action
is a finding that the named states have not made the necessary SIP
submission for interstate transport to meet the requirements under
section 110(a)(2)(D)(i)(I) of the CAA.

E. Unfunded Mandates Reform Act of 1995 (UMRA)

    This action does not contain any unfunded mandate as described in
UMRA 2 U.S.C. 1531-1538 and does not significantly or uniquely affect
small governments. The action imposes no enforceable duty on any state,
local or tribal governments or the private sector.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have
substantial direct effects 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.

G. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This action does not have tribal implications as specified in
Executive Order 13175. This action finds that seven states have failed
to complete the requirement in the CAA to submit SIPs under section
110(a)(2)(D)(i)(I) of the CAA for the 2015 ozone NAAQS. No tribe is
subject to the requirement to submit a transport SIP under section
110(a)(2)(D)(i)(I) of the CAA for the 2015 ozone NAAQS. Thus, Executive
Order 13175 does not apply to this action.

H. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks

    The EPA interprets Executive Order 13045 as applying only to those
regulatory actions that concern health or safety risks that the EPA has
reason to believe may disproportionately affect children, per the
definition of ``covered regulatory action'' in section 2-202 of the
Executive Order. This action is not subject to Executive Order 13045
because it is a finding that certain states have failed to submit a
complete SIP that satisfies interstate transport requirements under
section 110(a)(2)(D)(i)(I) of the CAA for the 2015 ozone NAAQS and does
not directly or disproportionately affect children.

I. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution or Use

    This action is not subject to Executive Order 13211, because it is
not a significant regulatory action under Executive Order 12866.

J. National Technology Transfer and Advancement Act

    This rulemaking does not involve technical standards.

K. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    The EPA believes the human health or environmental risk addressed
by this action will not have potential disproportionately high and
adverse human health or environmental effects on minority, low-income,
or indigenous populations. In finding that certain states have failed
to submit a complete SIP that satisfies the interstate transport
requirements under section 110(a)(2)(D)(i)(I) of the CAA for the 2015
ozone NAAQS, this action does not adversely affect the level of
protection provided to human health or the environment.

L. Congressional Review Act (CRA)

    This action is subject to the CRA, and the EPA will submit a rule
report to each House of the Congress and to the Comptroller General of
the United States. This action is not a ``major rule'' as defined by 5
U.S.C. 804(2).

M. Judicial Review

    Section 307(b)(l) of the CAA indicates which federal Courts of
Appeal have venue for petitions of review of final actions by the EPA
under the CAA. This section provides, in part, that petitions for
review must be filed in the Court of Appeals for the District of
Columbia Circuit if: (i) The agency action consists of ``nationally
applicable regulations promulgated, or final action taken, by the
Administrator,'' or (ii) such action is locally or regionally
applicable, but ``such action is based on a determination of nationwide
scope or effect and if in taking such action the Administrator finds
and publishes that such action is based on such a determination.''
    This final action is nationally applicable. To the extent a court
finds this final action to be locally or regionally applicable, the EPA
finds that this action is based on a determination of ``nationwide
scope or effect'' within the meaning of CAA section 307(b)(1). This
final action consists of findings of failure to submit required
interstate transport SIPs for the 2015 ozone NAAQS from seven states
located in four of the ten EPA Regional offices and five different
federal judicial circuits. This final action is also based on a common
core of factual findings concerning the receipt and completeness of the
relevant SIP submittals. For these reasons, this final action is
nationally applicable or, alternatively, to the extent a court finds
this action to be locally or regionally applicable, the Administrator
has determined that this final action is based on a determination of
nationwide scope or effect for purposes of CAA section 307(b)(1).
    Under section 307(b)(1) of the CAA, petitions for judicial review
of this action must be filed in the United States Court of Appeals for
the District of Columbia Circuit within 60 days from the date this
final action is published in the Federal Register. Filing a petition
for reconsideration by the Administrator of this final action does not
affect the finality of the action for the purposes of judicial review
nor does it extend the time within which a petition for judicial review
must be filed and shall not postpone the effectiveness of such rule or
action. Thus, any petitions for review of this action must be filed in
the Court of Appeals for the District of Columbia Circuit within 60
days from the date this final action is published in the Federal
Register.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Intergovernmental relations, Ozone, Reporting and
recordkeeping requirements.

    Dated: November 22, 2019.
Anne L. Idsal,
Acting Assistant Administrator.
[FR Doc. 2019-26136 Filed 12-4-19; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register: September 28, 2010 (Volume 75, Number 187)]
[Notices]
[Page 59773-59777]
[DOCID:fr28se10-121]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-62977; File No. SR-CBOE-2010-084]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Proposed Rule Change Regarding Registration and
Qualification Requirements

September 22, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on September 10, 2010, the Chicago Board Options Exchange,
Incorporated (``Exchange'' or ``CBOE'') filed with the Securities and
Exchange Commission (the ``Commission'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the Exchange. The Commission is publishing this notice to solicit
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 proposes to amend its rules regarding qualification
and registration of individual Trading Permit Holders and associated
persons. The text of the rule proposal is available on the Exchange's
Web site (http://www.cboe.org/legal), at the Exchange's Office of the
Secretary, on the Commission's Web site (http://www.sec.gov), and at
the Commission.

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 self-regulatory organization
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 those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

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

1. Purpose
    CBOE is proposing to amend its rules regarding qualification,
registration and continuing education of individual Trading Permit
Holders and individual associated persons.\3\ Specifically, in response
to a request by the Division of Trading and Markets of the U.S.
Securities and Exchange Commission and in light of recent market
events, the Exchange is proposing to expand its registration and
qualification requirements to include additional

types of individual Trading Permit Holders and individual associated
persons. The revised requirements apply to both CBOE and CBOE Stock
Exchange (``CBSX'') Trading Permit Holders and their associated
persons. CBOE is also proposing to clarify that certain requirements
throughout Rule 3.6A, including proposed Rule 3.6A(a), 3.6A(b) and
Interpretation and Policy .03 to 3.6A, apply to both Trading Permit
Holders and TPH organizations.\4\ The Exchange believes the proposed
rule changes are consistent with Rule 15b7-1,\5\ promulgated under the
Securities Exchange Act of 1934, as amended (``Exchange Act''),\6\
which provides: ``No registered broker or dealer shall effect any
transaction in * * * any security unless any natural person associated
with such broker or dealer who effects or is involved in effecting such
transaction is registered or approved in accordance with the standards
of training, experience, competence, and other qualification standards
* * * established by the rules of any national securities exchange * *
*''
---------------------------------------------------------------------------

    \3\ CBOE Rule 1.1(qq) provides ``The term `Associated Person' or
`Person Associated with a Trading Permit Holder' means any partner,
officer, director or branch manager of a Trading Permit Holder (or
any person occupying a similar status or performing similar
functions), any person directly or indirectly controlling,
controlled by, or under common control with a Trading Permit Holder,
or any employee of a Trading Permit Holder.'' This filing refers
specifically to the classification of ``individual associated
persons'' as an organization could fall within the scope of CBOE
Rule 1.1(qq) and it is not CBOE's intention to require registration
by an organization.
    \4\ Section 1.1 of CBOE's By-Laws provides: ``The term `Trading
Permit Holder' means any individual, corporation, partnership,
limited liability company or other entity authorized by the Rules
that holds a Trading Permit. If a Trading Permit Holder is an
individual, the Trading Permit Holder may also be referred to as an
`individual Trading Permit Holder.' If a Trading Permit Holder is
not an individual, the Trading Permit Holder may also be referred to
as a `TPH organization.' A Trading Permit Holder is a `member'
solely for purposes of the Act; however, one's status as a Trading
Permit Holder does not confer on that Person any ownership interest
in the Exchange.''
    \5\ 17 CFR 240.15b7-1.
    \6\ 15 U.S.C. 78a et seq.
---------------------------------------------------------------------------

    CBOE Rule 3.6A establishes the qualification and registration
requirements for associated persons of TPH organizations. This rule
currently establishes registration requirements for a Financial/
Operations Principal for each Trading Permit Holder and TPH
organization subject to the Exchange Act Rule 15c3-1.\7\ Rule 3.6A also
references the registration requirements set forth in Chapter IX of the
Exchange's Rulebook for associated persons of TPH organizations that
conduct a public customer business.
---------------------------------------------------------------------------

    \7\ 17 CFR 240.15c3-1.
---------------------------------------------------------------------------

    The Exchange is proposing to require additional Trading Permit
Holders and associated persons to submit the appropriate application
for registration online through the Central Registration Depository
system (``Web CRD''), which is operated by the Financial Industry
Regulatory Authority, Incorporated (``FINRA''), successfully complete
any qualification examination(s) as prescribed by the Exchange and
submit any required registration and examination fees. Specifically,
the Exchange is proposing to move the existing Rule 3.6A(a), governing
registration requirements for Financial and Operations Principals to
3.6A(b). CBOE is proposing to add Rule 3.6A(a)(1) that will require
registration and qualification by individual Trading Permit Holders and
individual associated persons engaged or to be engaged in the
securities business of a Trading Permit Holder or TPH organization.\8\
---------------------------------------------------------------------------

    \8\ An individual with an indirect ownership interest in a
Trading Permit Holder or TPH organization, that is engaged in the
securities business of such Trading Permit Holder or TPH
organization, is required to register under proposed Rule
3.6A(a)(1).
---------------------------------------------------------------------------

    CBOE is also proposing to adopt Interpretation and Policy .06 to
define what it means to be ``engaged in the securities business of a
Trading Permit Holder or TPH organization'' for purposes of this rule.
Specifically, an individual Trading Permit Holder or individual
associated person shall be considered to be a person engaged in the
securities business of a Trading Permit Holder or TPH organization if
(i) the individual Trading Permit Holder or associated person conducts
proprietary trading, acts as a market-maker, effects transactions on
behalf of a broker-dealer account, supervises or monitors proprietary
trading, market-making or brokerage activities on behalf of the broker-
dealer, supervises or conducts training for those engaged in
proprietary trading, market-making or brokerage activities on behalf of
a broker-dealer account; or (ii) the individual Trading Permit Holder
or associated person engages in the management of any individual
Trading Permit Holder or individual associated person identified in (i)
above as an officer, partner or director.\9\
---------------------------------------------------------------------------

    \9\ With the exception of its application to sole proprietors
(as registration of sole proprietors at CBOE is required under
proposed subparagraph (a) of Interpretation and Policy .06 to Rule
3.6A), this requirement is consistent with FINRA's registration
requirement for Principals (as defined in NASD Rule 1021). CBOE is
declining to adopt the term ``Principal'' in the Exchange Rulebook
to avoid confusion with existing terms, such as ``Option
Principal.''
---------------------------------------------------------------------------

    Web CRD has been enhanced by FINRA to allow for general
registration of applicable Trading Permit Holders and associated
persons. CBOE will require that all applicable Trading Permit Holders
and individual associated persons that are not already registered in
Web CRD, that are required to register under proposed Rule 3.6A, to
register within 60 days of the approval date of this filing by the U.S.
Securities and Exchange Commission. CBOE is currently working with the
Division of Trading and Markets of the U.S. Securities and Exchange
Commission to identify a reasonable time period for which compliance
with the additional examination requirements will be required. The
availability of the appropriate category on Web CRD for any new
qualification examinations recognized by the Exchange may be subject to
the timing for any required systems development on Web CRD.
    CBOE is considering various alternatives for an appropriate
qualification examination(s) for Trading Permit Holders and associated
persons required to register under proposed Rule 3.6A(a). These
alternatives include, but are not limited to, the successful completion
of CBOE's Trading Permit Holder Qualification Examination or the
development of a new qualification examination.\10\ The Exchange will
notify its Trading Permit Holders and TPH organizations via regulatory
circular what qualification examination(s) will be acceptable for
compliance with the requirements proposed in Rule 3.6A(a)(1).
Individual Trading Permit Holders or individual associated persons
acting in the capacity of a sole proprietor, officer, partner, director
or Chief Compliance Officer will be subject to heightened qualification
requirements. In addition, an individual Trading Permit Holder or
individual associated person that is engaged in the supervision or
monitoring of proprietary trading, market-making or brokerage
activities and/or that is engaged in the supervision or training of
those engaged in proprietary trading, market-making or brokerage
activities with respect to

those activities will be subject to heightened qualification
requirements. The Exchange believes that the heightened qualification
requirements should enhance the supervisory structure for Trading
Permit Holders and TPH organizations that do not conduct a public
customer business.
---------------------------------------------------------------------------

    \10\ CBOE has represented to Commission staff that it intends to
develop, within six months of the approval date of this filing, the
appropriate qualification examination(s) for the individual Trading
Permit Holders and associated persons that will be required to
register following the approval of this filing. Once the development
of an examination(s) has been completed, the implementation and
effective date will be subject to approval by the Commission and any
necessary systems development schedules to implement the
examination. If the Exchange does not complete development of the
examination(s) within six months of the approval date of this
filing, the Exchange will establish a deadline for qualification
based on the existing categories of registration and qualification
examinations available on Web CRD, until such time as the
development and implementation of an alternative examination(s) has
been completed. The referenced categories of registration available
on Web CRD include, but may not be limited to, the General
Securities Representative (GS) and General Securities Principal
(GP), as applicable to the type of business activities conducted.
The accompanying qualification examination for the General
Securities Representative is the Series 7 and the accompanying
qualification examination for the General Securities Principal is
the Series 24.
---------------------------------------------------------------------------

    The Exchange is also proposing to add Rule 3.6A(a)(2) to identify
several categories of persons that are exempt from these additional
registration requirements. The categories of individual Trading Permit
Holders and associated persons that are exempt from the registration
requirements set forth in Rule 3.6A(a)(1) include (i) Individual
associated persons functioning solely and exclusively in a clerical or
ministerial capacity; (ii) individual Trading Permit Holders and
individual associated persons that are not actively engaged in the
securities business, (iii) individual Trading Permit Holders and
individual associated persons functioning solely and exclusively to
meet a Trading Permit Holder's or TPH organization's need for nominal
corporate officers or for capital participation; and (iv) individual
associated persons whose functions are solely and exclusively related
to transactions in commodities, transactions in security futures and/or
effecting transactions on the floor of another national securities
exchange and who are registered as floor members with such exchange.
The Exchange believes these registration exemptions are appropriate
because CBOE would not consider individuals that fall into the
exemptions to be actively engaged in securities business unless they
are registered as floor members on another national securities
exchange, in which case, they are already registered as floor members
and not required to register at CBOE.\11\ CBOE believes incorporating
these exemptions into the rule provides additional clarity to
individual Trading Permit Holders and individual associated persons as
to who will or will not be required to register under the proposed
rule. Any applicable FINRA registration requirements would continue to
apply to Trading Permit Holders and TPH organizations that are also
members of FINRA.
---------------------------------------------------------------------------

    \11\ The Commission notes that these firms must comply with
Section 15(b)(8) of the Act.
---------------------------------------------------------------------------

    The Exchange is proposing to move the existing Rule 3.6A(b),
referencing the types of associated persons required to register under
Chapter IX of CBOE's Rules, to Rule 3.6A(d). CBOE is also proposing to
clarify the language in this section to make it clear that individual
associated persons, including Registered Options Principals and
Registered Representatives, are also subject to the registration
requirements set forth in Chapter IX of CBOE's Rules. Chapter IX is
generally applicable to TPH organizations that conduct a public
customer business.
    The Exchange is also proposing to adopt Rule 3.6A(c) to require the
designation of a Chief Compliance Officer by Trading Permit Holders and
TPH organizations that are registered broker-dealers, which designation
shall be updated on Schedule A of Form BD. Under the proposed rule, the
Chief Compliance Officer shall be required to register and pass the
appropriate qualification examination as prescribed by the
Exchange.\12\ This is consistent with FINRA Rule 3130 requiring
designation of at least one Chief Compliance Officer on Schedule A of
Form BD. In addition, NASD Rule 1022 requires registration by each
person designated as Chief Compliance Officer on Schedule A of Form BD.
CBOE is also proposing to implement a limited exemption from the
requirement to pass the appropriate qualification examination by a
Chief Compliance Officer. Specifically, a person that has been
designated as a Chief Compliance Officer on Schedule A of Form BD for
at least two years immediately prior to January 1, 2002, and who has
not been subject within the last ten years to any statutory
disqualification as defined in Section 3(a)(39) of the Act; a
suspension; or the imposition of a $5,000 or more fine for a
violation(s) of any provision of any securities law or regulation, or
any agreement with, rule or standard of conduct of any securities
governmental agency, securities self-regulatory organization, or as
imposed by any such self-regulatory organization in connection with a
disciplinary proceeding, shall be required to register in the category
of registration appropriate to the function to be performed as
prescribed by the Exchange, but shall be exempt from the requirement to
pass the heightened qualification examination as prescribed by the
Exchange.
---------------------------------------------------------------------------

    \12\ The appropriate qualification examination for a Chief
Compliance Officer is the Series 14 (Compliance Official). CBOE is
working with FINRA to establish this category of registration and
make the accompanying qualification examination available at CBOE on
Web CRD.
---------------------------------------------------------------------------

    The Exchange is proposing to adopt Rule 3.6A(e) to set forth the
requirements for examinations where there is a lapse in registration.
Specifically, an individual Trading Permit Holder or individual
associated person shall be required to pass the appropriate
qualification examination for the category of registration if the
individual Trading Permit Holder's or individual associated person's
registration has been revoked by the Exchange as a disciplinary
sanction or whose most recent registration has been terminated for a
period of two or more years.
    The Exchange is proposing to move the language in the existing
Interpretation and Policy .01 to Interpretation and Policy .02. The
Exchange is proposing to add language to Interpretation and Policy .01
requiring each individual Trading Permit Holder or individual
associated person subject to the registration requirements in Rule 3.6A
to electronically file a Uniform Application for Securities Industry
Registration through Web CRD.
    The Exchange is also proposing to move the existing Interpretation
and Policies .02 and .03 to Interpretation and Policies .03 and .04,
respectively. The Exchange is also proposing to modify the proposed
Interpretation and Policies .02, .03 and .04 to remove the existing
references to those with ``an associated person status'' enumerated
under paragraph (a) or (b) of the current Rule 3.6A and extend the
applicability to all individual Trading Permit Holders or individual
associated persons subject to the registration requirements in Rule
3.6A.
    The Exchange is also proposing to adopt Interpretation and Policy
.05 to Rule 3.6A. This will enable the Exchange to waive the
qualification examination requirement where good cause is shown.
Similar rules are in place at the New York Stock Exchange, Inc.
(``NYSE'') and FINRA.\13\ In determining whether a waiver shall be
granted, the Exchange shall consider, among other things, previous
industry employment, training and/or the successful completion of
similar qualification examinations of other self-regulatory
organizations.
---------------------------------------------------------------------------

    \13\ See NASD Rule 1070--Qualification Examinations and Waiver
of Requirements and NYSE Rule 345--Employees--Registration,
Approval, Records.
---------------------------------------------------------------------------

    In addition, the Exchange is proposing to add Interpretation and
Policy .07 that will require registration and successful completion of
a heightened qualification examination by at least two individuals that
are each an officer, partner or director of each Trading Permit Holder
or TPH organization that is a registered broker-dealer and has trading
privileges on the Exchange.\14\ However, please note that

all individuals who engage in supervisory functions of the Trading
Permit Holder's or TPH organization's securities business shall be
required to register and pass the appropriate heightened qualification
examination(s) relevant to the particular category of registration.
Trading Permit Holders that are sole proprietors are exempt from this
requirement. In addition, the Exchange may waive the requirement to
have two officers, partners and/or directors registered if a Trading
Permit Holder or TPH organization conclusively demonstrates that only
one officer, partner or director should be required to register. For
example, a TPH organization could conclusively demonstrate that only
one individual is required to register if such TPH organization is
owned by one individual (such as a single member limited liability
company), such individual acts as the only trader on behalf of the TPH
organization, and the TPH organization employs only one other
individual who functions only in a clerical capacity. The ability to
waive this registration requirement is consistent with similar FINRA
rules regarding principal registration.\15\
---------------------------------------------------------------------------

    \14\ With the exception of its application to sole proprietors,
this requirement is consistent with the registration requirement set
forth in NASD Rule 1021 addressing registration of two Principals
(as defined in NASD Rule 1021).
    \15\ See NASD Rule 1021(e).
---------------------------------------------------------------------------

    CBOE is also proposing to allow a Trading Permit Holder or TPH
organization that conducts proprietary trading only and has 25 or fewer
registered persons to have only one officer or partner registered under
this section rather than two. This exception is similar to that of
several other exchanges and reflects that such Trading Permit Holders
or TPH organizations do not necessitate the same level of supervisory
structure as those Trading Permit Holders or TPH organizations that
have customers or are larger in size. For purposes of this
Interpretation and Policy .07 to Rule 3.6A, a Trading Permit Holder or
TPH organization shall be considered to conduct only proprietary
trading if it has the following characteristics: (i) the Trading Permit
Holder or TPH organization is not required by Section 15(b)(8) of the
Exchange Act to become a FINRA member but is a member of another
registered securities exchange not registered solely under Section 6(g)
of the Exchange Act; (ii) all funds used or proposed to be used by the
Trading Permit Holder or TPH organization are the Trading Permit
Holder's or TPH organization's own capital, traded through the Trading
Permit Holder's or TPH organization's own accounts; (iii) the Trading
Permit Holder or TPH organization does not, and will not, have
customers; and (iv) all persons registered on behalf of the Trading
Permit Holder or TPH organization acting or to be acting in the
capacity of a trader must be owners of, employees of, or contractors to
the Trading Permit Holder or TPH organization. The description of what
constitutes proprietary trading for purposes of this Interpretation and
Policy .07 to Rule 3.6A is appropriate in that it provides additional
clarity for Trading Permit Holders and individual associated persons to
evaluate whether two individuals are required to register.
    In conjunction with the additional registration requirements, the
Exchange is proposing to delete a reference in Interpretation and
Policy .01 to Rule 9.3A that excludes those people whose activities are
limited solely to the transaction of business on the Floor with Trading
Permit Holders or registered broker-dealers from the definition of
``registered person'' for purposes of Rule 9.3A. The changes proposed
to Interpretation and Policy .04 of Rule 3.6A would subject individual
Trading Permit Holders and individual associated persons whose
activities are limited solely to the transaction of business on the
Floor with Trading Permit Holders or registered broker dealers to the
continuing education requirements set forth in Rule 9.3A or any other
continuing education requirements as prescribed by the Exchange.
    This filing also proposes to make several technical and/or non-
substantive changes. First, the Exchange is proposing to modify the
title of Rule 3.6A to delete the term ``Certain'' and to clarify that
the registration requirements set forth in Rule 3.6A also apply to
specified Trading Permit Holders. The Exchange is also proposing to
make a technical change to proposed Rule 3.6A(b) that will replace the
reference to the ``Department of Financial and Sales Practice
Compliance'' with the ``Exchange'' because the Exchange no longer has a
department by that name. In addition, the Exchange is proposing to
replace the two references in this section to ``in a form and manner
prescribed by the Exchange'' with ``as prescribed by the Exchange'' for
consistency throughout Rule 3.6A. The Exchange is also proposing to
amend several references in CBOE Rules 3.6A, 9.2 and 9.3. Specifically,
these rules currently reference ``NASD's Web CRD System.'' Since NASD
is now known as FINRA, CBOE is proposing to change this reference to
``Web CRD.'' The Exchange is proposing to clarify Rule 9.3(c) relating
to amended Form U-5 to provide ``the facts or circumstances giving rise
to the need for the amendment'' rather than ``facts and circumstances
giving rise to the amendment.'' Finally, CBOE is proposing to replace
language relating to ``said termination notice'' in Rule 9.3(b) and
``notice'' in Rule 9.3(c) with ``Form U-5'' for specificity.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
Section 6(b) of the Act,\16\ in general, and furthers the objectives of
Section 6(b)(5) of the Act,\17\ which requires, among other things,
that the Exchange's rules be designed to remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and protect investors and the public interest. Specifically,
the enhanced registration and qualification requirements will provide
additional protection to investors and further promote the public
interest.
---------------------------------------------------------------------------

    \16\ 15 U.S.C. 78f(b).
    \17\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    In addition, the Exchange believes that the proposed rule change is
consistent with Section 6(c) of the Act,\18\ in general, and furthers
the objectives of Section 6(c)(3)(B) of the Act,\19\ which provides,
among other things, that a national securities exchange may bar a
natural person from becoming associated with a member if such natural
person does not meet the standards of training, experience and
competence as prescribed by the rules of the national securities
exchange. The Exchange also believes that the proposed rule change
furthers the objectives of Section 6(c)(3)(C) of the Act,\20\ which
provides, among other things, that a national securities exchange may
bar any person from becoming associated with a member if such person
does not agree to supply the exchange with such information with
respect to its dealings with the member as may be specified by the
rules of the exchange and to permit the examination of its books and
records to verify the accuracy of any information so supplied.
---------------------------------------------------------------------------

    \18\ 15 U.S.C. 78f(c).
    \19\ 15 U.S.C. 78f(c)(3)(B).
    \20\ 15 U.S.C. 78f(c)(3)(C).
---------------------------------------------------------------------------

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

    CBOE does not believe that the proposed rule change will impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of the Act.

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

    The Exchange neither solicited nor received comments on the
proposal.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File No. SR-CBOE-2010-084 on the subject line.

Paper Comments

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

All submissions should refer to File No. SR-CBOE-2010-084. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Web site (http://www.sec.gov/rules/sro.shtml). Copies
of the submission,\21\ all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for Web site viewing and printing in
the Commission's Public Reference Room, 100 F Street, NE., Washington,
DC 20549, on official business days between the hours of 10 a.m. and 3
p.m. Copies of such filing also will be available for inspection and
copying at the principal office of CBOE. All comments received will be
posted without change; the Commission does not edit personal
identifying information from submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File No. SR-CBOE-2010-084 and should be submitted on or
before October 19, 2010.
---------------------------------------------------------------------------

    \21\ The text of the proposed rule change is available on the
Commission's Web site at http://www.sec.gov.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
---------------------------------------------------------------------------

    \22\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-24343 Filed 9-27-10; 8:45 am]
BILLING CODE 8010-01-P


[Federal Register Volume 80, Number 230 (Tuesday, December 1, 2015)]
[Notices]
[Pages 75147-75148]
[FR Doc No: 2015-30384]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76518; File No. SR-NASDAQ-2015-145]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Include Managed Fund Shares in the Lead Market Maker Program

November 24, 2015.
    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 November 18, 2015, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by the Exchange.
The Commission is publishing this notice to solicit 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 proposes to add Managed Fund Shares to the list of
securities eligible to be Qualified Securities under the Lead Market
Maker Program of Rule 7014(f). The Exchange will implement the proposed
change no earlier than December 1, 2015 and no later than January 4,
2016. The implementation date will be announced by an Equity Trader
Alert.
    The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaq.cchwallstreet.com, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant 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 is proposing to include Managed Fund Shares, as
described under Rule 5735, to the list of securities eligible to be
treated as a Qualified Security under the Lead Market Maker (``LMM'')
Program of Rule 7014(f). The LMM Program is designed to provide
incentive to market makers to make markets in certain relatively
illiquid exchange-traded products (``ETPs''). The Exchange provides
credits to a designated LMM for execution of a Qualified Security.
Under Rule 7014(f)(1), a Qualified Security is defined as an exchange-
traded fund or index-linked security listed on Nasdaq pursuant to
Nasdaq Rules 5705 (Exchange Traded Funds: Portfolio Depository Receipts
and Index Fund Shares), 5710 (Securities Linked to the Performance of
Indexes and Commodities, Including Currencies), or 5720 (Trust Issued
Receipts), and it must have at least one LMM. A LMM is a registered
Nasdaq market maker for a Qualified Security that has committed to
maintain minimum performance standards. A LMM is selected by Nasdaq
based on factors including, but not limited to, experience with making
markets in exchange-traded funds and index-linked securities, adequacy
of capital, willingness to promote Nasdaq as a marketplace, issuer
preference, operational capacity, support personnel, and history of
adherence to Nasdaq rules and securities laws. Nasdaq may limit the
number of LMMs in a security, or modify a previously established limit,
upon prior written notice to members.
    As noted above, Nasdaq currently includes in the program Portfolio
Depository Receipts, Index Fund Shares, Securities Liked to the
Performance of Indexes and Commodities, and Trust Issued Receipts.
Nasdaq is proposing to add another ETP, Managed Fund Shares, as
eligible to be a Qualified Security under the LMM Program. A Managed
Fund Share is a security that (a) represents an interest in a
registered investment company (``Investment Company'') organized as an
open-end management investment company or similar entity, that invests
in a portfolio of securities selected by the Investment Company's
investment adviser consistent with the Investment Company's investment
objectives and policies; (b) is issued in a specified aggregate minimum
number in return for a deposit of a specified portfolio of securities
and/or a cash amount with a value equal to the next determined net
asset value; and (c) when aggregated in the same specified minimum
number, may be redeemed at a holder's request, which holder will be
paid a specified portfolio of securities and/or cash with a value equal
to the next determined net asset value.\3\ Managed Fund Shares are
similar to other Exchange Traded Funds (``ETFs'') listed pursuant to
Rule 5705(b), which, like Managed Fund Shares, are organized as an
open-end investment company or similar entity. Unlike Rule 5705(b) ETFs
that seek to provide investment results that correspond generally to
the price and yield performance of a specific foreign or domestic stock
index, fixed income securities index or combination thereof, Managed
Fund Share ETFs are actively-managed, in that they invest in a
portfolio of securities selected by its investment adviser consistent
with its investment objectives and policies. Nasdaq has observed that
Managed Fund Shares are generally less liquid than other ETPs.
Consequently, Nasdaq has determined to allow Managed Fund Shares to be
considered Qualified Securities under the program, which the Exchange
believes will improve market quality in these securities.
---------------------------------------------------------------------------

    \3\ See Rule 5735(c)(1).
---------------------------------------------------------------------------

2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\4\ in general, and with
Sections 6(b)(4) and 6(b)(5) of the Act,\5\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among members and issuers and other persons using any
facility or system which Nasdaq operates or controls, and is designed
to prevent fraudulent and manipulative acts and practices, to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest; and is not designed to
permit unfair discrimination between customers, issuers, brokers, or
dealers.
---------------------------------------------------------------------------

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

    The Exchange believes that inclusion of Managed Fund Shares in the
LMM Program is reasonable because they are currently relatively thinly-
traded on Nasdaq, and the LMM Program is

designed [sic] improve liquidity in ETPs. Specifically, the LMM Program
allocates rebates to LMMs that quote at the national best bid and best
offer for certain percentages of time. As additional incentive, the LMM
Program also provides different levels of fee caps on the fees assessed
for participation in the Opening and Closing Crosses on Nasdaq. The LMM
Program has been successful at improving market quality in the
securities covered by the program. As such, the Exchange believes the
program will be effective at providing incentive to market makers on
Nasdaq to become LMMs in a [sic] Managed Fund Shares thereby improving
market quality in those securities. The Exchange also believes that
including Managed Fund Shares is reasonable because they are similar to
other ETFs, which are currently included in the LMM Program. The
Exchange believes that the proposed change to Rule 7014(f) is an
equitable allocation and is not unfairly discriminatory because all
market makers that voluntarily elect to be designated as LMMs and meet
the minimum performance criteria have the opportunity to qualify for a
rebate and fee cap under the program in Managed Fund Shares.

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

    The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
Specifically, the change is designed to promote improved market quality
through the application of an ETP incentive program to a type of ETP
that is currently not part of the program, and has comparatively low
liquidity. Such a change is designed to improve market quality in
Qualified Securities on Nasdaq, and does not place a burden on
competition between market participants as the changes are applied
consistently to all participants. Lastly, to the extent market quality
improves on Nasdaq in Managed Fund Shares, the proposed change may
promote competition among exchanges for new Managed Fund Share listings
and similar incentive programs, to the benefit of all market
participants transacting in Managed Fund Shares.

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, if consistent with
the protection of investors and the public interest, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\6\ and Rule 19b-4(f)(6) thereunder.\7\
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission 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 change should be approved or disapproved.

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-NASDAQ-2015-145 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-NASDAQ-2015-145.
This file number should be included on the subject line if email is
used. To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street NE., Washington, DC 20549, on official business days between the
hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be
available for inspection and copying at the principal offices of the
Exchange. All comments received will be posted without change; the
Commission does not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
NASDAQ-2015-145 and should be submitted on or before December 22, 2015.
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-30384 Filed 11-30-15; 8:45 am]
BILLING CODE 8011-01-P