[Federal Register Volume 81, Number 246 (Thursday, December 22, 2016)]
[Notices]
[Pages 93979-93986]
[FR Doc No: 2016-30795]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79584; File No. SR-Phlx-2016-119]

Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing
of Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To
Amend the PIXL Price Improvement Auction in Phlx Rule 1080(n) and To
Make Pilot Program Permanent

December 16, 2016
    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 December 6, 2016, NASDAQ PHLX LLC (``Phlx'' or ``Exchange'') filed
with the Securities and Exchange Commission (``SEC'' or ``Commission'')
the proposed rule change as described in Items I, II, and III, below,
which Items have been prepared by the Exchange. On December 15, 2016,
the Exchange filed Amendment No. 1 to the proposed rule change, which
amended and replaced the proposed rule change in its entirety. The
Commission is publishing this notice to solicit comments on the
proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend Phlx Rule 1080(n), concerning a
price-improvement mechanism entitled ``Price Improvement XL'', also
known as ``PIXL.'' Certain aspects of PIXL are currently operating on a
pilot basis (``Pilot''), which was initially approved by the Commission
in 2010,\3\ and which is set to expire on January 18, 2017.\4\ In this
proposal, the Exchange proposes to make the Pilot permanent, and to
change the requirements for providing price improvement for PIXL
Auction Orders, other than Auctions involving Complex Orders, of less
than 50 option contracts.
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    \3\ See Securities Exchange Act Release No. 63027 (October 1,
2010), 75 FR 62160 (October 7, 2010) (SR-Phlx-2010-108) (``PIXL
Approval Order'').
    \4\ See Securities Exchange Act Release No. 78301 (July 12,
2016), 81 FR 46731 (July 18, 2016) (SR-PHLX-2016-75).
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    The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaqphlx.cchwallstreet.com/ 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 purpose of this proposed rule change is to make permanent
certain pilots within Rule 1080(n), relating to PIXL. In addition, Phlx
proposes to modify the requirements for PIXL auctions involving less
than 50 contracts (other than auctions involving Complex Orders) where
the National Best Bid and Offer (``NBBO'') is only $0.01 wide.
Background
    The Exchange adopted PIXL in October 2010 as a price-improvement

mechanism on the Exchange.\5\ PIXL is a component of the Exchange's
fully automated options trading system, PHLX XL[supreg], that allows an
Exchange member (an ``Initiating Member'') to electronically submit for
execution an order it represents as agent on behalf of a public
customer, broker dealer, or any other entity (``PIXL Order'') against
principal interest or against any other order it represents as agent
(an ``Initiating Order'') provided it submits the PIXL Order for
electronic execution into the PIXL Auction (``Auction'') pursuant to
the Rule.
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    \5\ In addition to the PIXL Approval Order and the most recent
extension cited above, the following proposed rule changes have been
submitted in connection with PIXL. See Securities Exchange Act
Release Nos. 65043 (August 5, 2011), 76 FR 49824 (August 11, 2011)
(SR-Phlx-2011-104) (Extending Pilot for Price Improvement System,
Price Improvement XL); 67399 (July 11, 2012), 77 FR 42048 (July 17,
2012) (SR-Phlx-2012-94) (Extending Pilot for Price Improvement
System, Price Improvement XL); 69845 (June 25, 2013), 78 FR 39429
(July 1, 2013) (SR-Phlx-2013-46) (Order Granting Approval To
Proposed Rule Change, as Modified by Amendment No. 1, Regarding
Complex Order PIXL); 69989 (July 16, 2013), 78 FR 43950 (July 22,
2013) (SR-Phlx-2013-74) (Extending Pilot for Price Improvement
System, Price Improvement XL); 70654 (October 10, 2013), 78 FR 62891
(October 22, 2013) (SR-Phlx-2013-76) (Order Granting Approval to
Proposed Rule Change Relating to the Discontinuation of the
Differentiation of Price Improvement XL Orders of Less Than 50
Contracts); 72619 (July 16, 2014), 79 FR 42613 (July 22, 2014)
(Extending Pilot for Price Improvement System, Price Improvement
XL); and 75470 (July 16, 2015) 80 FR 43509 (July 22, 2015) (Amending
Exchange Rule 1080(n), Price Improvement XL (``PIXL'') to Extend,
Until July 18, 2016, a Pilot Program).
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    An Initiating Member may initiate a PIXL Auction by submitting a
PIXL Order, which is not a Complex Order, in one of three ways:
     First, the Initiating Member could submit a PIXL Order
specifying a single price at which it seeks to execute the PIXL Order
(a ``stop price'').
     Second, an Initiating Member could submit a PIXL Order
specifying that it is willing to automatically match as principal or as
agent on behalf of an Initiating Order the price and size of all
trading interest and responses to the PIXL Auction Notification
(``PAN,'' as described below) (``auto-match''), in which case the PIXL
Order will be stopped at the better of the National Best Bid/Offer
(``NBBO'') or the Reference BBO \6\ on the Initiating Order side.
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    \6\ The ``Reference BBO'' is defined as the ``internal market
BBO.''
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     Third, an Initiating Member could submit a PIXL Order
specifying that it is willing to either: (i) Stop the entire order at a
single stop price and auto-match PAN responses, as described below,
together with trading interest, at a price or prices that improve the
stop price to a specified price above or below which the Initiating
Member will not trade (a ``Not Worse Than'' or ``NWT'' price); (ii)
stop the entire order at a single stop price and auto-match all PAN
responses and trading interest at or better than the stop price; or
(iii) stop the entire order at the better of the NBBO or Reference BBO
on the Initiating Order side, and auto-match PAN responses and trading
interest at a price or prices that improve the stop price up to the NWT
price. In all cases, if the PHLX Best Bid/Offer (``PBBO'') on the same
side of the market as the PIXL Order represents a limit order on the
book, the stop price must be at least one minimum price improvement
increment better than the booked limit order's limit price.
    In addition, an Initiating Member may initiate a PIXL Auction by
submitting a Complex PIXL Order which is of a conforming ratio, as
defined in Commentary .08(a)(i) and (a)(ix) to Rule 1080. When
submitting a Complex PIXL Order, the Initiating Member must stop the
PIXL Order at a price that is better than the best net price (debit or
credit) (i) available on the Complex Order book regardless of the
Complex Order book size; and (ii) achievable from the best PHLX bids
and offers for the individual options (an ``improved net price''),
provided in either case that such price is equal to or better than the
PIXL Order's limit price.
    After the PIXL Order is entered, a PAN is broadcast and a blind
Auction ensues for a period of time as determined by the Exchange and
announced on the Nasdaq Trader Web site. The Auction period will be no
less than one hundred milliseconds and no more than one second. Anyone
may respond to the PAN by sending orders or quotes. At the conclusion
of the Auction, the PIXL Order will be allocated at the best price(s).
    Once the Initiating Member has submitted a PIXL Order for
processing, such PIXL Order may not be modified or cancelled. Under any
of the above circumstances, the Initiating Member's stop price or NWT
price may be improved to the benefit of the PIXL Order during the
Auction, but may not be cancelled. Under no circumstances will the
Initiating Member receive an allocation percentage, at the final price
point, of more than 50% with one competing quote, order or PAN response
or 40% with multiple competing quotes, orders or PAN responses, when
competing quotes, orders or PAN responses have contracts available for
execution. After a PIXL Order has been submitted, a member organization
submitting the order has no ability to control the timing of the
execution.
The Pilot
    As described above, four components of the PIXL system are
currently operating on a pilot basis: (i) Auction eligibility for
Complex Orders in a PIXL Auction; (ii) the provision that an unrelated
market or marketable limit order (against the PBBO) on the opposite
side of the market from the PIXL Order received during the Auction will
not cause the Auction to end early and will execute against interest
outside of the Auction; (iii) the early conclusion of a PIXL Auction;
and (iv) no minimum size requirement of orders entered into PIXL. The
pilot has been extended until January 18, 2017.\7\
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    \7\ See note 4 above.
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    As described in greater detail below, during the pilot period the
Exchange has been required to submit, and has been submitting, certain
data periodically as required by the Commission, to provide supporting
evidence that, among other things, there is meaningful competition for
all size orders, there is significant price improvement available
through PIXL, and that there is an active and liquid market functioning
on the Exchange both within PIXL and outside of the Auction mechanism.
The Exchange has also analyzed the impact of certain aspects of the
Pilot; for example, the early conclusion of an Auction due to the PBBO
crossing the PIXL Order stop price on the same side of the market as
the PIXL Order, or due to a trading halt.
    The Exchange now seeks to have the Pilot approved on a permanent
basis. In addition, the Exchange proposes to modify the scope of PIXL
so that PIXL Orders for less than 50 option contracts, other than
Auctions involving Complex Orders, will be required to receive price
improvement of at least one minimum price improvement increment over
the NBBO if the NBBO is only $0.01 wide. For orders of 50 contracts or
more, or if the difference in the NBBO is greater than $0.01, and for
Complex Orders, the requirements for price improvement remain the same.
Price Improvement for Orders Under 50 Contracts
    Currently, a PIXL Auction may be initiated if all of the following
conditions are met. If the PIXL Order (except if it is a Complex Order)
is for the account of a public customer the Initiating Member must stop
the entire PIXL Order (except if it is a Complex Order) at a price that
is equal to or better than the National Best Bid/Offer

(``NBBO'') and the internal market BBO (the ``Reference BBO'') on the
opposite side of the market from the PIXL Order, provided that such
price must be at least one minimum price improvement increment (as
determined by the Exchange but not smaller than one cent) better than
any limit order on the limit order book on the same side of the market
as the PIXL Order.
    If the PIXL Order (except if it is a Complex Order) is for the
account of a broker dealer or any other person or entity that is not a
public customer the Initiating Member must stop the entire PIXL Order
(except if it is a Complex Order) at a price that is the better of: (i)
The Reference BBO price improved by at least one minimum price
improvement increment on the same side of the market as the PIXL Order,
or (ii) the PIXL Order's limit price (if the order is a limit order),
provided in either case that such price is at or better than the NBBO
and the Reference BBO.
    PHLX proposes to amend the PIXL auction to require at least $0.01
price improvement for a PIXL Order, except if it is a Complex Order, if
that order is for less than 50 contracts and if the difference between
the NBBO is $0.01. Accordingly, PHLX is proposing to amend the Auction
Eligibility Requirements to require that, if the PIXL Order (except if
it is a Complex Order) is for less than 50 option contracts, and if the
difference between the NBBO is $0.01, the Initiating Member must stop
the entire PIXL Order at one minimum price improvement increment better
than the NBBO on the opposite side of the market from the PIXL Order,
and better than any limit order on the limit order book on the same
side of the market as the PIXL Order. This requirement will apply
regardless of whether the PIXL Order is for the account of a public
customer, or where the PIXL Order is for the account of a broker dealer
or any other person or entity that is not a Public Customer. The
Exchange will continue to require that the Initiating Member stop the
entire PIXL Order at a price that is better than any limit order on the
limit order book on the same side of the market as the PIXL Order
regardless of the size of the PIXL Order and the width of the NBBO.
    The Exchange will retain the current requirements for auction
eligibility where the PIXL Order is for the account of a public
customer and such order is for 50 option contracts or more, or if the
difference between the NBBO is greater than $0.01. The Exchange will
also retain the current requirements for auction eligibility where the
PIXL Order is for the account of a broker dealer or any other person or
entity that is not a public customer and such order is for 50 option
contracts or more, or if the difference between the NBBO is greater
than $0.01.
    Accordingly, the Exchange is amending the Auction Eligibility
Requirements to state that, if the PIXL Order (except if it is a
Complex Order) is for the account of a public customer and such order
is for 50 option contracts or more or if the difference between the
NBBO is greater than $0.01, the Initiating Member must stop the entire
PIXL Order at a price that is equal to or better than the NBBO on the
opposite side of the market from the PIXL Order, provided that such
price must be at least one minimum price improvement increment (as
determined by the Exchange but not smaller than one cent) better than
any limit order on the limit order book on the same side of the market
as the PIXL Order.
    Similarly, the Exchange is amending the Auction Eligibility
Requirements to state that, if the PIXL Order (except if it is a
Complex Order) is for the account of a broker dealer or any other
person or entity that is not a public customer and such order is for 50
option contracts or more, or if the difference between the NBBO is
greater than $0.01, the Initiating Member must stop the entire PIXL
Order (except if it is a Complex PIXL Order) at a price that is the
better of: (i) The Reference BBO price improved by at least the Minimum
Increment on the same side of the market as the PIXL Order, or (ii) the
PIXL Order's limit price (if the order is a limit order), provided in
either case that such price is at or better than the NBBO and the
Reference BBO.\8\
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    \8\ In implementing this change, the System will reject a PIXL
Order to buy if the NBBO is only $0.01 wide and the agency order is
stopped on the offer provided the order is not customer to customer.
The system will reject a PIXL Order to sell if the NBBO is only
$0.01 wide and the Agency order is stopped on the bid provided the
order is not customer to customer. The system will allow a customer
to customer PIXL Order to trade on either the bid or offer, if the
NBBO is $0.01 wide, provided (1) the execution price is equal to or
within the NBBO, (2) there is no resting customer at the execution
price, and (3) $0.01 is the Minimum Price Variation (MPV) of the
option. The system will continue to reject a PIXL Order to buy if
the NBBO is only $0.01 wide and the Agency order is stopped on the
bid if there is a resting order on the bid. The system will continue
to reject a PIXL Order to sell if the NBBO is only $0.01 wide and
the Agency order is stopped on the offer if there is resting order
on the offer. The system will provide an explicit reject reason if
the system rejects a PIXL Order because the NBBO is only $0.01 wide
and the PIXL Order did not improve the contra side NBBO. The
handling of Complex PIXL Orders will be unchanged regardless of the
NBBO width.
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    The Exchange also proposes to add language to Rule 1080(n)(i) to
clarify that, if any of the auction eligibility criteria are not met,
the PIXL Order will be rejected. The Exchange will also add language to
Rule 1080(n)(i) to clarify the treatment of paired public customer -to-
public customer orders pursuant to Rule 1080(n)(vi) as a result of
these proposed changes. Specifically, Exchange will allow a PIXL Order
to trade on either the bid or offer, pursuant to Rule 1080(n)(vi), if
the NBBO is $0.01 wide, provided (1) the execution price is equal to or
within the NBBO, (2) there is no resting customer at the execution
price, and (3) $0.01 is the Minimum Price Variation (MPV) of the
option. The Exchange also proposes to add language that it will
continue to reject a PIXL Order to buy (sell) if the NBBO is only $0.01
wide and the Agency order is stopped on the bid (offer) if there is a
resting order on the bid (offer). These requirements are unchanged from
the Exchange's current handling practices of paired public customer-to-
public customer PIXL Orders per Rule 1080(n)(vi), and the Exchange's
current practice of rejecting PIXL Orders to buy (sell) if the NBBO is
only $0.01 wide and the Agency order is stopped on the bid (offer) if
there is a resting order on the bid (offer).
    The Exchange believes that these changes to PIXL may provide
additional opportunities for PIXL Orders, other than Complex Orders, of
under 50 option contracts to receive price improvement over the NBBO
where the difference in the NBBO is $0.01 and therefore encourage the
increased submission of orders of under 50 option contracts.\9\ Phlx
notes that the statistics for the current pilot, which include, among
other things, price improvement for orders of less than 50 option
contracts under the current auction eligibility requirements, show
relatively small amounts of price improvement for such orders. Phlx
believes that the proposed requirements will therefore increase the
price improvement that orders of under 50 option contracts may receive
in PIXL. The Exchange also notes that the initial PIXL requirements for
auction eligibility differentiated between PIXL Orders for a size of
less than 50 option contracts and PIXL Orders for a size of 50
contracts or more (both for PIXL Orders for the account of a public
customer and for the account of a broker-dealer of any other person or
entity that is not a public customer), with more stringent requirements
for

PIXL Orders for a size of less than 50 option contracts.\10\
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    \9\ For the reasons discussed below, the Exchange is not
proposing to modify the auction eligibility requirements for Complex
Orders to require increased improvement.
    \10\ See PIXL Approval Order, supra note 3. Specifically, if the
PIXL Order was for the account of a public customer and was for a
size of 50 contracts or more, the Initiating Member must stop the
entire PIXL Order at a price that is equal to or better than the
NBBO on the opposite side of the market from the PIXL Order,
provided that such price must be at least one minimum price
improvement increment (as determined by the Exchange but not smaller
than one cent) better than any limit order on the limit order book
on the same side of the market as the PIXL Order. See PIXL Approval
Order, supra note 3. In contrast, if the PIXL Order was for the
account of a public customer and is for a size of less than 50
contracts, the Initiating Member must stop the entire PIXL Order at
a price that is the better of: (i) The PBBO price on the opposite
side of the market from the PIXL Order improved by at least one
minimum price improvement increment, or (ii) the PIXL Order's limit
price (if the order is a limit order), provided in either case that
such price is at or better than the NBBO, and at least one minimum
price improvement increment better than any limit order on the book
on the same side of the market as the PIXL Order. Id. The Exchange
subsequently eliminated this size-based distinction for purposes of
determining auction eligibility. See Securities Exchange Act Release
No. 70654 (October 10, 2013), 78 FR 62891 (October 22, 2013) (Order
approving SR-Phlx-2013-76). The auction eligibility requirements for
orders of a size of less than 50 contracts, both for orders
submitted for the account of a public customer and for orders
submitted for the account of a broker-dealer or any other person or
entity that is not a public customer, had been operating on a pilot
basis, and were also eliminated accordingly. Id. In that order, the
Commission noted that approving the elimination of the auction
eligibility requirements for orders of under 50 option contracts did
not affect the no minimum size pilot. Id.
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Auction Eligibility Requirements for Complex Orders
    Rule 1080(n) sets forth separate auction eligibility requirements
for Complex Orders. If the PIXL Order is a Complex Order and of a
conforming ratio, as defined in Rule 1098(a)(i) and (a)(ix), the
Initiating Member must stop the entire PIXL Order at a price that is
better than the best net price (debit or credit) (i) available on the
Complex Order book regardless of the Complex Order book size; and (ii)
achievable from the best Phlx bids and offers for the individual
options (an ``improved net price''), provided in either case that such
price is equal to or better than the PIXL Order's limit price. Complex
Orders consisting of a ratio other than a conforming ratio will not be
accepted. This provision applies to all Complex Orders submitted into
PIXL and, where applied to Complex Orders where the smallest leg is
less than 50 contracts in size, is part of the current Pilot.
    The Exchange is not proposing to modify the auction eligibility
requirements for Complex Orders to require increased price improvement,
as Rule 1080(n)(i)(C) already requires that the Initiating Member must
stop the entire PIXL Order at a price that is better than the best net
price (debit or credit) that is available on the Complex Order book
regardless of the Complex Order book size; and that is achievable from
the best Phlx bids and offers for the individual options, provided in
either case that such price is equal to or better than the PIXL Order's
limit price.
    The Exchange is proposing, however, to make permanent the sub-
paragraph concerning auction eligibility for Complex Orders in PIXL.
Rule 1080(n)(i)(C) states that the auction eligibility requirements for
a PIXL Order that is a Complex Order, where applied to Complex Orders
where the smallest leg is less than 50 contracts in size, is part of
the current Pilot.\11\
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    \11\ The Commission approved expanding PIXL to include Complex
Orders in 2013, and approved this provision on a pilot basis. See
Securities Exchange Act Release No. 69845 (June 25, 2013), 78 FR
39429 (July 1, 2013) (SR-Phlx-2013-46).
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    As noted above, when PIXL was initially proposed, the Exchange
proposed auction eligibility requirements for simple PIXL Orders for a
size of less than 50 contracts that were more stringent than the
auction eligibility requirements for simple PIXL Orders for a size of
50 contracts or more. When initially proposed, the Exchange proposed to
implement this size-based distinction on a pilot basis in order to
ascertain the price improvement that small customer orders (i.e., less
than 50 contracts) would receive under the Pilot.\12\ In approving
different auction eligibility requirements for simple PIXL Orders of
less than 50 contracts, the SEC noted that it was approving this
provision on a pilot basis so that it could ascertain the level of
price improvement attained for smaller-sized orders during the pilot
period.\13\ When expanding PIXL to include Complex Orders, the Exchange
proposed implementing size-based auction eligibility requirements for
Complex Orders in PIXL on a pilot basis accordingly. The SEC
subsequently approved the elimination of the size-based distinction for
auction eligibility for simple PIXL Orders, and permitted Phlx to adopt
the auction eligibility standard that previously applied to orders of
50 contracts or greater.\14\
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    \12\ See PIXL Approval Order, supra note 3. As initially
approved, for public customer orders, if the simple PIXL Order was
for 50 contracts or more, the Initiating Member must stop the entire
PIXL Order at a price that is equal to or better than the National
Best Bid/Offer (``NBBO'') on the opposite side of the market from
the PIXL Order, provided that such price must be at least one
minimum price improvement increment (as determined by the Exchange
but not smaller than one cent) better than any limit order on the
limit order book on the same side of the market as the PIXL Order.
If the PIXL Order was for a size of less than 50 contracts, the
Initiating Member must stop the entire PIXL Order at a price that is
the better of: (i) The PBBO price on the opposite side of the market
from the PIXL Order improved by at least one minimum price
improvement increment, or (ii) the PIXL Order's limit price (if the
order is a limit order), provided in either case that such price is
better than the NBBO, and at least one minimum price improvement
increment better than any limit order on the book on the same side
of the market as the PIXL Order.
    \13\ See PIXL Approval Order, supra note 3.
    \14\ See Securities Exchange Act Release No. 70654 (October 10,
2013), 78 FR 62891 (October 22, 2013) (SR-Phlx-2013-76).
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    Phlx believes it is appropriate to approve this aspect of the Pilot
on a permanent basis for two reasons. First, Phlx notes that the
auction eligibility requirements for simple PIXL Orders are currently
operating on a permanent basis.\15\ Although the auction eligibility
requirements for Complex PIXL Orders distinguish between Complex PIXL
Orders where the smallest leg is less than 50 contracts and Complex
PIXL Orders where the smallest leg is 50 contracts or greater, the
substantive auction eligibility requirements for all Complex PIXL
Orders are currently the same. To the extent that the SEC approved the
simple PIXL Order auction eligibility requirements on a pilot basis, it
was to determine if the different auction eligibility requirements for
simple PIXL Orders of less than 50 contracts resulted in different
levels of price improvement for those orders in comparison to simple
PIXL Orders of 50 contracts or greater. Since no comparable distinction
exists here, and since the auction eligibility requirements for Complex
PIXL Orders where the smallest leg is 50 contracts or greater is
already operating on a permanent basis, Phlx believes it is appropriate
to approve, on a permanent basis, the same auction eligibility
requirements for Complex PIXL Orders where the smallest leg is less
than 50 contracts.
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    \15\ See footnote 10 supra.
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    Second, the Exchange also believes that it is appropriate to
approve this aspect of the Pilot on a permanent basis for Complex
Orders where the smallest leg is less than 50 contracts in size because
this will continue to provide such Orders with the opportunity to
receive price improvement. Specifically, the Exchange believes that the
auction eligibility requirements, which require a Complex Order to be
stopped at a net debit/credit price that improves upon the stated
markets present for the individual components of the Complex Order,
ensure that at least one option leg will be executed at a better price
than the established bid or offer for such leg. Moreover, as discussed
in greater detail

below, Phlx has gathered data throughout the Pilot that indicates that
there is a robust market for simple orders, including small customer
orders, both within and outside of PIXL, and significant opportunities
for price improvement for small customer orders that are entered into
PIXL. Phlx believes that the market for Complex Orders, including small
customer orders, both within and outside of PIXL is similarly robust,
and therefore believes it is appropriate to approve this aspect of the
Pilot on a permanent basis.
No Minimum Size Requirement
    Rule 1080(n)(vii) provides that, as part of the current Pilot,
there will be no minimum size requirement for orders to be eligible for
the Auction.\16\ The Exchange proposed the no-minimum size requirement
for PIXL auctions because it believed that this would provide small
customer orders with the opportunity for price improvement. In
initially approving PIXL, the Commission noted that it would evaluate
the PIXL auction during the Pilot Period to determine whether it would
be beneficial to customers and to the options market as a whole to
approve any proposal requesting permanent approval to permit orders of
fewer than 50 contracts to be submitted to the PIXL auction.\17\
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    \16\ The Rule also requires the Exchange to submit certain data,
periodically as required by the Commission, to provide supporting
evidence that, among other things, there is meaningful competition
for all size orders and that there is an active and liquid market
functioning on the Exchange outside of the Auction mechanism. Any
raw data which is submitted to the Commission will be provided on a
confidential basis.
    \17\ See PIXL Approval Order, supra note 3.
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    The Exchange believes that the data gathered since the approval of
the Pilot establishes that there is liquidity and competition both
within PIXL and outside of PIXL, and that there are opportunities for
significant price improvement within PIXL.\18\ For simple PIXL Orders,
in the period between January and June 2015, PIXL auctions executed
34.8 million contracts, which represents 11.4% of total PHLX contract
volume. The average daily number of contracts traded on PIXL declined
from 399,361 contracts per day in January 2015 to 187,062 contracts per
day in June 2015. The percent of PHLX volume traded in PIXL auctions
declined from 14.4% in January 2015 to 8.5% in June 2015. The percent
of consolidated volume traded in PIXL auctions fell from 2.3% in
January 2015 to 1.2% in June 2015.
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    \18\ Specifically, the Exchange gathered and reported fifteen
separate data fields relating to PIXL Orders of fewer than 50
contracts, including (1) the number of orders of fewer than 50
contracts entered into the PIXL Auction; (2) the percentage of all
orders of fewer than 50 contracts sent to Phlx that are entered into
the PIXL Auction; (3) the spread in the option, at the time an order
of fewer than 50 contracts is submitted to the PIXL Auction; and (4)
of PIXL trades where the PIXL Order is for the account of a public
customer, and is for a size of fewer than 50 contracts, the
percentage done at the NBBO plus $.01, plus $.02, plus $.03, etc.
The Exchange also gathered and reported multiple data fields
relating to competition, including, for the first Wednesday of each
month: (1) The total number of PIXL auctions on that date; (2) the
number of PIXL auctions where the order submitted to the PIXL was
fewer than 50 contracts; (3) the number of PIXL auctions where the
order submitted to the PIXL was 50 contracts or greater; and (4) the
number of PIXL auctions (for orders of fewer than 50 contracts) with
0 participants (excluding the initiating participant), 1
participant, 2 participants, etc. See PIXL Approval Order, supra
note 3.
---------------------------------------------------------------------------

    For simple PIXL Orders, the mean number of unique participants in
PIXL auctions was 4.0 and median was 3.0. The distribution of auctions
and contracts traded by number of unique participants were similar,
with a single participant in about 25% of auctions.
    The Exchange has also gathered information about activity in orders
for less than 50 contracts and 50 contracts or greater for simple PIXL
auctions between January and June 2015. For auctions occurring during
that period, 93% of auctions were for orders for less than 50
contracts, a percentage that increased slightly over that time period.
Auctions for orders of less than 50 contracts accounted for 45.5% of
the contract volume traded in PIXL. Auctions of 50 contracts or more
made up 7.0% of all PIXL auctions and accounted for 54.5% of contracts
traded in PIXL.
    With respect to price improvement, 68.6% of PIXL auctions for
simple PIXL Orders executed at a price that was better than the NBBO at
the time the auction began. 69.2% of auctions for less than 50
contracts received price improvement. 56.3% of auctions for 50
contracts or more received price improvement. 66.5% of contracts in
auctions for less than 50 contracts received price improvement. 55.7%
of auctions for 50 contracts or more received price improvement. The
equal-weighted average price improvement was 5.5% for auctions of less
than 50 contracts and 4.9% for auctions of 50 contracts or more.
Average price improvement was 5.6% when PBBO was at the NBBO and 3.4%
when PBBO was not at the NBBO.
    Phlx has also gathered data relating to the number of Complex
Orders entered into PIXL. For November 2016, a total of 18,016 orders
were entered into PIXL where the smallest leg was less than 50
contracts, representing 99, 941 contracts.\19\ For November 2016, a
total of 641 orders were entered into PIXL where the smallest leg was
50 contracts or greater, representing 52,686 contracts.
---------------------------------------------------------------------------

    \19\ In connection with this amendment, this November 2016 data
for Complex Orders is being submitted as Exhibit 3b to the filing.
---------------------------------------------------------------------------

    PHLX believes that the data gathered during the Pilot period
indicates that there is meaningful competition in PIXL auctions for all
size orders, there is an active and liquid market functioning on the
Exchange outside of the auction mechanism, and that there are
opportunities for significant price improvement for orders executed
through PIXL. With respect to Complex Orders, the Exchange believes
that this data establishes that there is liquidity and competition both
within PIXL for Complex Orders and outside of PIXL for Complex Orders.
The Exchange also believes that approving this aspect of the Pilot on a
permanent basis would continue to permit the entry of small into PIXL,
thereby continuing to provide such Orders with the opportunity for
price improvement. The Exchange therefore believes that it appropriate
to approve the no-minimum size requirement on a permanent basis for
both simple and Complex PIXL Orders.
Early Conclusion of the PIXL Auction
    Rule 1080(n)(ii)(B) provides that the PIXL Auction shall conclude
at the earlier of (1) the end of the Auction period; (2) for a PIXL
Auction (except if it is a Complex Order), any time the Reference BBO
crosses the PIXL Order stop price on the same side of the market as the
PIXL Order; (3) for a Complex Order PIXL Auction, any time the cPBBO
\20\ or the Complex Order book crosses the Complex PIXL Order stop
price on the same side of the market as the Complex PIXL Order; or (4)
any time there is a trading halt on the Exchange in the affected
series.\21\

The last three conditions are operating as part of the current Pilot.
---------------------------------------------------------------------------

    \20\ Rule 1098(a) defines the cPBBO as ``the best net debit or
credit price for a Complex Order Strategy based on the PBBO for the
individual options components of such Complex Order Strategy, and,
where the underlying security is a component of the Complex Order,
the National Best Bid and/or Offer for the underlying security.''
See Rule 1098(a)(iv).
    \21\ If the situations described in either of the final three
conditions occur, the entire PIXL Order will be executed at: (1) In
the case of the Reference BBO crossing the PIXL Order stop price,
the best response price(s) or, if the stop price is the best price
in the Auction, at the stop price, unless the best response price is
equal to or better than the price of a limit order resting on the
PHLX book on the same side of the market as the PIXL Order, in which
case the PIXL Order will be executed against that response, but at a
price that is at least one minimum price improvement increment
better than the price of such limit order at the time of the
conclusion of the Auction; (2) in the case of the cPBBO or the
Complex Order book crossing the Complex PIXL Order stop price on the
same side of the market as the Complex PIXL Order, the stop price
against executable PAN responses and executable Complex Orders using
the allocation algorithm in sub-paragraph (E)(2)(d)(i) through (iv);
or (3) in the case of a trading halt on the Exchange in the affected
series, the stop price, in which case the PIXL Order will be
executed solely against the Initiating Order. Any unexecuted PAN
responses will be cancelled. See Rule 1080(n)(ii)(C).
---------------------------------------------------------------------------

    As with the no minimum size requirement, the Exchange has gathered
data on these three conditions to assess the effect of early PIXL
Auction conclusions on the Pilot.\22\ Between January and June 2015,
320 auctions for simple PIXL Orders terminated early because the Phlx
BBO crossed the PIXL Order stop price on the same side of the market.
No auctions terminated early because of halts. The number of auctions
that terminated early was 1/100th of 1% of all PIXL auctions over the
period. The auctions that terminated early included 1/100th of 1% of
contracts traded in PIXL auctions. The share of auctions that
terminated early was stable between January and June 2015.
---------------------------------------------------------------------------

    \22\ The Exchange agreed to gather and submit the following data
on this part of the Pilot: (1) The number of times that the PBBO
crossed the PIXL Order stop price on the same side of the market as
the PIXL Order and prematurely ended the PIXL Auction, and at what
time the PIXL Auction ended; (2) the number of times that a trading
halt prematurely ended the PIXL auction and at what time the trading
halt ended the PIXL Auction; (3) of the Auctions terminated early
due to the PBBO crossing the PIXL order stop price, the number that
resulted in price improvement over the PIXL Order stop price, and
the average amount of price improvement provided to the PIXL Order;
(4) in the Auctions terminated early due to the PBBO crossing the
PIXL order stop price, the percentage of contracts that received
price improvement over the PIXL order stop price; (5) of the
Auctions terminated early due to a trading halt, the number that
resulted in price improvement over the PIXL Order stop price, and
the average amount of price improvement provided to the PIXL Order;
(6) in the auctions terminated early due to a trading halt, the
percentage of contracts that received price improvement over the
PIXL order stop price; (7) the average amount of price improvement
provided to the PIXL Order when the PIXL Auction is not terminated
early (i.e., runs the full one second); (8) the number of times an
unrelated market or marketable limit order (against the PBBO) on the
opposite side of the PIXL Order is received during the Auction
Period; and (9) the price(s) at which an unrelated market or
marketable limit order (against the PBBO) on the opposite side of
the PIXL Order that is received during the Auction Period is
executed, compared to the execution price of the PIXL Order. See
PIXL Approval Order, supra note 3.
---------------------------------------------------------------------------

    Between January and June 2015, 76.3% of PIXL auctions for simple
PIXL Orders that terminated early executed at a price that was better
than the NBBO at the time the auction began. 71.9% of contracts in
auctions that terminated early received price improvement. The average
amount of price improvement per contract for PIXL auctions that
terminated early was 4.1%.
    Based on the data gathered during the pilot, the Exchange does not
anticipate that any of these conditions will occur with significant
frequency, or will otherwise significantly affect the functioning of
PIXL auctions. The Exchange also notes that over 75% of PIXL auctions
for simple PIXL Orders that terminated early executed at a price that
was better than the NBBO at the time the auction began, and over 70% of
contracts in auctions that terminated early received price improvement.
With respect to Complex PIXL Order, the Exchange similarly does not
anticipate, based on the data gathered on this aspect of the Pilot for
simple PIXL Orders, that either Rule 1080(n)(ii)(B)(3) or (4) will
occur with significant frequency, or will otherwise significantly
affect the functioning of Complex PIXL Order auctions. The Exchange
therefore believes it is appropriate to approve this aspect of the
Pilot on a permanent basis for both simple and Complex PIXL Orders.
Unrelated Market or Marketable Limit Order
    Rule 1080(n)(ii)(D) provides that an unrelated market or marketable
limit order (against the PBBO) on the opposite side of the market from
the PIXL Order received during the Auction will not cause the Auction
to end early and will execute against interest outside of the Auction.
In the case of a Complex PIXL Auction, an unrelated market or
marketable limit Complex Order on the opposite side of the market from
the Complex PIXL Order as well as orders for the individual components
of the Complex Order received during the Auction will not cause the
Auction to end early and will execute against interest outside of the
Auction. If contracts remain from such unrelated order at the time the
Auction ends, they will be considered for participation in the order
allocation process described elsewhere in the Rule. This section is
operating as part of the current Pilot.
    In approving this feature on a pilot basis, the Commission found
that ``allowing the PIXL auction to continue for the full auction
period despite receipt of unrelated orders outside the Auction would
allow the auction to run its full course and, in so doing, will provide
a full opportunity for price improvement to the PIXL Order. Further,
the unrelated order would be available to participate in the PIXL order
allocation.'' \23\ The Exchange believes that this rationale continues
to apply for both simplex and Complex PIXL Orders. The Exchange also
does not believe that this provision has had a significant impact on
either the unrelated order or the PIXL auction process, either for
simple or Complex PIXL Orders. The Exchange therefore believes it is
appropriate to approve this aspect of the Pilot on a permanent basis
for both simple and Complex PIXL Orders.
---------------------------------------------------------------------------

    \23\ See PIXL Approval Order, supra note 3.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\24\ in general and with
Section 6(b)(5) of the Act,\25\ in that it is designed 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, or to regulate by virtue of any authority conferred by the Act
matters not related to the purposes of the Act or the administration of
the Exchange.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78f.
    \25\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is also
consistent with Section 6(b)(8) of the Act \26\ in that it does not
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    Specifically, the Exchange believes that PIXL, including the rules
to which the Pilot applies, results in increased liquidity available at
improved prices, with competitive final pricing out of the Initiating
Participant's complete control. The Exchange believes that PIXL
promotes and fosters competition and affords the opportunity for price
improvement to more options contracts. The Exchange believes that the
changes to the PIXL Auction requiring price improvement of at least one
minimum price improvement increment over the NBBO for PIXL Orders,
other than Complex Orders, of less than 50 option contracts where the
difference in the NBBO is $0.01 will provide further price improvement
for those PIXL Orders, and thereby encourage additional submission of
those orders into PIXL. The Exchange notes that statistics for the
current pilot, which

include, among other things, price improvement for orders of less than
50 option contracts under the current auction eligibility requirements,
show relatively small amounts of price improvement for such orders.
Phlx believes that the proposed requirements will therefore increase
the price improvement that orders of under 50 option contracts may
receive in PIXL.
    The Exchange believes that approving the Pilot on a permanent basis
is also consistent with the Act. With respect to the auction
eligibility for Complex Orders, Phlx believes that it is appropriate to
approve these requirements when applied to Complex Orders where the
smallest leg is less than 50 contracts in size on a permanent basis.
Phlx notes that the auction eligibility requirements for simple PIXL
Orders are currently operating on a permanent basis, and that the same
auction eligibility requirements currently apply to Complex PIXL Orders
where the smallest leg is 50 contracts or greater. Phlx believes that
approving this aspect of the Pilot on a permanent basis will continue
to provide such Orders with the opportunity to receive price
improvement. Specifically, the Exchange believes that the auction
eligibility requirements, which require a Complex Order to be stopped
at a net debit/credit price that improves upon the stated markets
present for the individual components of the Complex Order, ensures
that at least one option leg will be executed at a better price than
the established bid or offer for such leg. Phlx also believes that, as
with the market for simple orders, the market for complex orders,
including small customer orders, both within and outside of PIXL is
similarly robust.
    With respect to the no minimum size requirement, the Exchange
believes that the data gathered during the Pilot period indicates that
there is meaningful competition in PIXL auctions for all size orders in
both simple and Complex PIXL Orders, there is an active and liquid
market functioning on the Exchange outside of the auction mechanism,
and that there are opportunities for significant price improvement for
orders executed through PIXL, including for small customer orders. The
Exchange also believes that approving this aspect of the Pilot on a
permanent basis would continue to permit the entry of small simple and
Complex Orders into PIXL, thereby continuing to provide such Orders
with the opportunity for price improvement.
    With respect to the early termination of a PIXL Auction, the
Exchange believes that it is appropriate to terminate an auction any
time the Reference BBO crosses the PIXL Order stop price on the same
side of the market as the PIXL Order (and the related provision for a
Complex Order PIXL Auction), or any time there is a trading halt on the
Exchange in the affected series. Based on the data gathered during the
pilot for simple PIXL Orders, the Exchange does not anticipate that any
of these conditions will occur with significant frequency for either
simple or Complex PIXL Orders, or will otherwise disrupt the
functioning of PIXL auctions for simple or Complex PIXL Orders. The
Exchange also notes that a significant percentage of PIXL auctions for
simple PIXL Orders that terminated early executed at a price that was
better than the NBBO at the time the auction began, and that a
significant percentage of contracts in auctions that terminated early
received price improvement.
    With respect to the requirement that an unrelated market or
marketable limit order (against the PBBO) on the opposite side of the
market from the PIXL Order received during the Auction will not cause
the Auction to end early and will execute against interest outside of
the Auction, and the corresponding provision for Complex Orders, the
Exchange does not believe that these provisions have had a significant
impact on either the unrelated order or the PIXL auction process for
either simple or Complex PIXL Orders. The Exchange also believes that
allowing the PIXL Auction to continue in this scenario, both for simple
and Complex PIXL Orders, will allow the auction to run its full course
and, in so doing, will provide a full opportunity for price improvement
to the PIXL Order, in addition to affording the unrelated order the
opportunity to participate in the PIXL order allocation.

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

    The Exchange 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. The proposal will apply to all
Exchange members, and participation in the PIXL Auction process is
completely voluntary. Based on the data collected by the Exchange
during the Pilot, the Exchange believes that there is meaningful
competition in PIXL auctions for all size orders, there are
opportunities for significant price improvement for orders executed
through PIXL, and that there is an active and liquid market functioning
on the Exchange outside of PIXL. The Exchange believes that requiring
increased price improvement for PIXL Orders may encourage competition
by attracting additional orders to participate in PIXL. The Exchange
believes that approving the Pilot on a permanent basis for both simple
and Complex PIXL Orders will not significantly impact competition, as
the Exchange is proposing no other change to the Pilot beyond
implementing it on a permanent basis.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission shall: (a) By order approve
or disapprove such 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, as modified by Amendment No. 1, 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-Phlx-2016-119 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-Phlx-2016-119. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the

submission, all subsequent amendments, all written statements with
respect to the proposed rule change that are filed with the Commission,
and all written communications relating to the proposed rule change
between the Commission and any person, other than those that may be
withheld from the public in accordance with the provisions of 5 U.S.C.
552, will be available for Web site viewing and printing in the
Commission's Public Reference Room, 100 F Street NE., Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change; the Commission does not edit
personal identifying information from submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-Phlx-2016-119 and should be
submitted on or before January 12, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\27\
---------------------------------------------------------------------------

    \27\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016-30795 Filed 12-21-16; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 134 (Friday, July 12, 2019)]
[Proposed Rules]
[Pages 33193-33194]
[FR Doc No: 2019-14774]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2019-0472; Airspace Docket No. 19-ACE-9]
RIN 2120-AA66

Proposed Amendment of Class E Airspace; Mount Pleasant, IA

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: This action proposes to amend the Class E airspace extending
upward from 700 feet above the surface at Mount Pleasant Municipal
Airport, Mount Pleasant, IA. The FAA is proposing this action as the
result of an airspace review caused by the decommissioning of the Mount
Pleasant non-directional beacon (NDB), which provided navigation
information for the instrument procedures at this airport. Airspace
redesign is necessary for the safety and management of instrument
flight rules (IFR) operations at this airport.

DATES: Comments must be received on or before August 26, 2019.

ADDRESSES: Send comments on this proposal to the U.S. Department of
Transportation, Docket Operations, West Building Ground Floor, Room
W12-140, 1200 New Jersey Avenue SE, Washington, DC 20590; telephone
(202) 366-9826, or<PHONE_NUMBER>. You must identify FAA Docket No.
FAA-2019-0472; Airspace Docket No. 19-ACE-9, at the beginning of your
comments. You may also submit comments through the internet at http://www.regulations.gov. You may review the public docket containing the
proposal, any comments received, and any final disposition in person in
the Dockets Office between 9:00 a.m. and 5:00 p.m., Monday through
Friday, except federal holidays.
    FAA Order 7400.11C, Airspace Designations and Reporting Points, and
subsequent amendments can be viewed online at http://www.faa.gov/air_traffic/publications/. For further information, you can contact the
Airspace Policy Group, Federal Aviation Administration, 800
Independence Avenue SW, Washington, DC 20591; telephone: (202) 267-
8783. The Order is also available for inspection at the National
Archives and Records Administration (NARA). For information on the
availability of FAA Order 7400.11C at NARA, call<PHONE_NUMBER>, or go
to http://www.archives.gov/federal-register/cfr/ibr-locations.html.
    FAA Order 7400.11, Airspace Designations and Reporting Points, is
published yearly and effective on September 15.

FOR FURTHER INFORMATION CONTACT: Jeffrey Claypool, Federal Aviation
Administration, Operations Support Group, Central Service Center, 10101
Hillwood Parkway, Fort Worth, TX 76177; telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The FAA's authority to issue rules regarding aviation safety is
found in Title 49 of the United States Code. Subtitle I, Section 106
describes the authority of the FAA Administrator. Subtitle VII,
Aviation Programs, describes in more detail the scope of the agency's
authority. This rulemaking is promulgated under the authority described
in Subtitle VII, Part A, Subpart I, Section 40103. Under that section,
the FAA is charged with prescribing regulations to assign the use of
airspace necessary to ensure the safety of aircraft and the efficient
use of airspace. This regulation is within the scope of that authority
as it would amend the Class E airspace extending upward from 700 feet
above the surface at Mount Pleasant Municipal Airport, Mount Pleasant,
IA, to support IFR operations at this airport.

Comments Invited

    Interested parties are invited to participate in this proposed
rulemaking by submitting such written data, views, or arguments, as
they may desire. Comments that provide the factual basis supporting the
views and suggestions presented are particularly helpful in developing
reasoned regulatory decisions on the proposal. Comments are
specifically invited on the overall regulatory, aeronautical, economic,
environmental, and energy-related aspects of the proposal.
Communications should identify both docket numbers and be submitted in
triplicate to the address listed above. Commenters wishing the FAA to
acknowledge receipt of their comments on this notice must submit with
those comments a self-addressed, stamped postcard on which the
following statement is made: ``Comments to Docket No. FAA-2019-0472;
Airspace Docket No. 19-ACE-9.'' The postcard will be date/time stamped
and returned to the commenter.
    All communications received before the specified closing date for
comments will be considered before taking action

on the proposed rule. The proposal contained in this notice may be
changed in light of the comments received. A report summarizing each
substantive public contact with FAA personnel concerned with this
rulemaking will be filed in the docket.

Availability of NPRMs

    An electronic copy of this document may be downloaded through the
internet at http://www.regulations.gov. Recently published rulemaking
documents can also be accessed through the FAA's web page at http://www.faa.gov/air_traffic/publications/airspace_amendments/.
    You may review the public docket containing the proposal, any
comments received, and any final disposition in person in the Dockets
Office (see the ADDRESSES section for the address and phone number)
between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal
holidays. An informal docket may also be examined during normal
business hours at the Federal Aviation Administration, Air Traffic
Organization, Central Service Center, Operations Support Group, 10101
Hillwood Parkway, Fort Worth, TX 76177.

Availability and Summary of Documents for Incorporation by Reference

    This document proposes to amend FAA Order 7400.11C, Airspace
Designations and Reporting Points, dated August 13, 2018, and effective
September 15, 2018. FAA Order 7400.11C is publicly available as listed
in the ADDRESSES section of this document. FAA Order 7400.11C lists
Class A, B, C, D, and E airspace areas, air traffic service routes, and
reporting points.

The Proposal

    The FAA is proposing an amendment to Title 14 Code of Federal
Regulations (14 CFR) part 71 by amending the Class E airspace extending
upward from 700 feet above the surface to within a 6.4-mile radius
(increased from a 6-mile radius) of the Mount Pleasant Municipal
Airport, Mount Pleasant, IA; and removing the Mount Pleasant NDB and
the associated extension from the airspace legal description.
    This action is necessary due to an airspace review caused by the
decommissioning of the Mount Pleasant NDB, which provided navigation
information for the instrument procedures at this airport.
    Class E airspace designations are published in paragraph 6005 of
FAA Order 7400.11C, dated August 13, 2018, and effective September 15,
2018, which is incorporated by reference in 14 CFR 71.1. The Class E
airspace designation listed in this document will be published
subsequently in the Order.

Regulatory Notices and Analyses

    The FAA has determined that this regulation only involves an
established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current, is
non-controversial and unlikely to result in adverse or negative
comments. It, therefore: (1) Is not a ``significant regulatory action''
under Executive Order 12866; (2) is not a ``significant rule'' under
DOT Regulatory Policies and Procedures (44 FR 11034; February 26,
1979); and (3) does not warrant preparation of a regulatory evaluation
as the anticipated impact is so minimal. Since this is a routine matter
that will only affect air traffic procedures and air navigation, it is
certified that this rule, when promulgated, would not have a
significant economic impact on a substantial number of small entities
under the criteria of the Regulatory Flexibility Act.

Environmental Review

    This proposal will be subject to an environmental analysis in
accordance with FAA Order 1050.1F, ``Environmental Impacts: Policies
and Procedures'' prior to any FAA final regulatory action.

List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

    Accordingly, pursuant to the authority delegated to me, the Federal
Aviation Administration proposes to amend 14 CFR part 71 as follows:

PART 71--DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR
TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

0
 1. The authority citation for 14 CFR part 71 continues to read as
follows:

     Authority:  49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O.
10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

Sec.  71.1  [Amended]

0
 2. The incorporation by reference in 14 CFR 71.1 of FAA Order
7400.11C, Airspace Designations and Reporting Points, dated August 13,
2018, and effective September 15, 2018, is amended as follows:

Paragraph 6005 Class E Airspace Areas Extending Upward From 700
Feet or More Above the Surface of the Earth.

* * * * *

ACE IA E5 Mount Pleasant, IA [Amended]

Mount Pleasant Municipal Airport, IA
    (Lat. 40[deg]56'48'' N, long. 91[deg]30'40'' W)

    That airspace extending upward from 700 feet above the surface
within a 6.4-mile radius of Mount Pleasant Municipal Airport.

    Issued in Fort Worth, Texas, on July 3, 2019.
John Witucki,
Acting Manager, Operations Support Group, ATO Central Service Center.
[FR Doc. 2019-14774 Filed 7-11-19; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register Volume 77, Number 136 (Monday, July 16, 2012)]
[Rules and Regulations]
[Pages 41692-41697]
[FR Doc No: 2012-17276]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 9 and 721

[EPA-HQ-OPPT-2011-0633; FRL-9349-4]
RIN 2070-AB27

Significant New Use Rule for Phenol, 2,4- dimethyl-6-(1-
methylpentadecyl)-

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is finalizing a significant new use rule (SNUR) under the
Toxic Substances Control Act (TSCA) for the chemical substance
identified as phenol, 2,4-dimethyl-6-(1-methylpentadecyl)- (PMN P-94-
209; CAS No. 134701-20-5). This action requires persons who intend to

manufacture, import, or process the substance for an activity that is
designated as a significant new use by this final rule to notify EPA at
least 90 days before commencing that activity. The required
notification would provide EPA with the opportunity to evaluate the
intended use and, if necessary, to prohibit or limit that activity
before it occurs.

DATES: This final rule is effective August 15, 2012.

ADDRESSES: EPA has established a docket for this action under docket
identification (ID) number EPA-HQ-OPPT-2011-0633. All documents in the
docket are listed in the docket index available at http://www.regulations.gov. Although listed in the index, some information is
not publicly available, e.g., Confidential Business Information (CBI)
or other information whose disclosure is restricted by statute. Certain
other material, such as copyrighted material, is not placed on the
Internet and will be publicly available only in hard copy form.
Publicly available docket materials are available in the electronic
docket at http://www.regulations.gov, or, if only available in hard
copy, at the OPPT Docket. The OPPT Docket is located in the EPA Docket
Center (EPA/DC) at Rm. 3334, EPA West Bldg., 1301 Constitution Ave.
NW., Washington, DC. The EPA/DC Public Reading Room hours of operation
are 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal
holidays. The telephone number of the EPA/DC Public Reading Room is
(202) 566-1744, and the telephone number for the OPPT Docket is (202)
566-0280. Docket visitors are required to show photographic
identification, pass through a metal detector, and sign the EPA visitor
log. All visitor bags are processed through an X-ray machine and
subject to search. Visitors will be provided an EPA/DC badge that must
be visible at all times in the building and returned upon departure.

FOR FURTHER INFORMATION CONTACT:
    For technical information contact: Abeer Hashem, 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 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. Does this action apply to me?

    You may be potentially affected by this action if you manufacture,
import, process, or use the chemical substance contained in this final
rule. Potentially affected entities may include, but are not limited
to:
     Manufacturers, importers, or processors of the subject
chemical substance (NAICS codes 325 and 324110), e.g., chemical
manufacturing and petroleum refineries.
    This listing is not intended to be exhaustive, but rather provides
a guide for readers regarding entities likely to be affected by this
action. Other types of entities not listed in this unit could also be
affected. The North American Industrial Classification System (NAICS)
codes have been provided to assist you and others in determining
whether this action might apply to certain entities. To determine
whether you or your business may be affected by this action, you should
carefully examine the applicability provisions in Sec.  721.5. If you
have any questions regarding the applicability of this action to a
particular entity, consult the technical person listed under FOR
FURTHER INFORMATION CONTACT.
    This action may also affect certain entities through pre-existing
import certification and export notification rules under TSCA. Chemical
importers are subject to the TSCA section 13 (15 U.S.C. 2612) import
certification requirements promulgated at 19 CFR 12.118 through 12.127;
see also 19 CFR 127.28. Chemical importers must certify that the
shipment of the chemical substance complies with all applicable rules
and orders under TSCA. Importers of chemicals subject to a final SNUR
must certify their compliance with the SNUR requirements. The EPA
policy in support of import certification appears at 40 CFR part 707,
subpart B. In addition, any persons who export or intend to export a
chemical substance are subject to the export notification provisions of
TSCA section 12(b) (15 U.S.C. 2611(b)) (see Sec.  721.20), and must
comply with the export notification requirements in 40 CFR part 707,
subpart D.

II. Background

A. What action is the Agency taking?

    EPA is finalizing a SNUR for the chemical substance identified as
phenol, 2,4-dimethyl-6-(1-methylpentadecyl)-, (PMN P-94-209; CAS No.
134701-20-5). This action requires persons who intend to manufacture,
import, or process the subject chemical substance for an activity that
is designated as a significant new use by this final rule to notify EPA
at least 90 days before commencing that activity. This rule was
proposed in the Federal Register of December 28, 2011 (76 FR 81437)
(FRL-9325-9). In response to the proposed SNUR, EPA received two public
comments. One commenter stated that ``phenol is not a safe product to
use.'' As discussed in Units II. and IV. of the proposed rule, EPA did
identify potential hazards for the PMN substance (which is a different
chemical substance than ``phenol'') but did not find a potential
unreasonable risk. EPA proposed this SNUR to require notification so
that EPA could evaluate potential risks from any new uses. Another
commenter stated that EPA should include an exemption for worker
protection requirements when the PMN substance was present in a mixture
at low concentrations, specifically at less than 1.0 percent. The
commenter also stated that the SNUR should contain an exemption from
the requirements of the rule including recordkeeping when it is
incorporated into certain substrates. The commenter suggested these
exemptions because the PMN substance is often used as an additive in
thermoplastic polymer matrices and in mixtures at concentrations less
than 1.0 percent. Because EPA does not expect significant risks from
these activities, EPA will include these exemptions in the final rule.
Therefore, the Agency is issuing a final SNUR that:
    1. Adds protection in the workplace requirements under Sec.  721.63
for dermal protection.
    2. Includes an exemption from the requirements under Sec.  721.63
when the substance is present in a mixture less than 1.0 percent.
    3. Removes all release to water requirements under Sec.  721.90.
    4. Includes an exemption from all requirements of the rule
including recordkeeping once the PMN substance has been incorporated
into polymer matrices.
    5. Revises the recordkeeping requirements under Sec.  721.125 to
reflect the modified significant new uses.
    This final SNUR requires persons to notify EPA at least 90 days
before commencing the manufacture, import, or processing of the
chemical substance identified as phenol, 2,4-dimethyl-6-(1-
methylpentadecyl)-, (PMN P-94-209, CAS No.134701-20-5), for any
activity designated by this final SNUR as a significant new use.
Receipt of such notices allows EPA to assess risks that may be
presented by the intended uses and, if appropriate, to regulate the
proposed use before it occurs.

B. What is the Agency's authority for taking this action?

    Section 5(a)(2) of TSCA (15 U.S.C. 2604(a)(2)) authorizes EPA to
determine that a use of a chemical substance is a ``significant new
use.'' EPA must make this determination by rule after considering all
relevant factors, including those listed in TSCA section 5(a)(2). Once
EPA determines that a use of a chemical substance is a significant new
use, TSCA section 5(a)(1)(B) requires persons to submit a significant
new use notice (SNUN) to EPA at least 90 days before they manufacture,
import, or process the chemical substance for that use. Persons who
must report are described in Sec.  721.5.

C. Applicability of General Provisions

    General provisions for SNURs appear in 40 CFR part 721, subpart A.
These provisions describe persons subject to the rule, recordkeeping
requirements, exemptions to reporting requirements, and applicability
of the rule to uses occurring before the effective date of the final
rule. Provisions relating to user fees appear at 40 CFR part 700.
According to Sec.  721.1(c), persons subject to this SNUR must comply
with the same notice requirements and EPA regulatory procedures as
submitters of PMNs under TSCA section 5(a)(1)(A). In particular, these
requirements include the information submission requirements of TSCA
section 5(b) and 5(d)(1), the exemptions authorized by TSCA section
5(h)(1), (h)(2), (h)(3), and (h)(5), and the regulations at 40 CFR part
720. Once EPA receives a SNUN, EPA may take regulatory action under
TSCA section 5(e), 5(f), 6, or 7 to control the activities for which it
has received the SNUN. If EPA does not take action, EPA is required
under TSCA section 5(g) to explain in the Federal Register its reasons
for not taking action.
    Chemical importers are subject to the TSCA section 13 (15 U.S.C.
2612) import certification requirements promulgated in Customs and
Border Patrol regulations at 19 CFR 12.118 through 12.127; see also 19
CFR 127.28. Chemical importers must certify that the shipment of the
chemical substance complies with all applicable rules and orders under
TSCA. For importers of the chemical substance subject to this final
SNUR those requirements include the SNUR. The EPA policy in support of
import certification appears at 40 CFR part 707, subpart B. In
addition, any persons who export or intend to export the chemical
substance are subject to the export notification provisions of TSCA
section 12(b) (15 U.S.C. 2611 (b)) (see Sec.  721.20) and must comply
with the export notification requirements in 40 CFR part 707, subpart
D.

III. Rationale and Objectives of the Final Rule

A. Rationale

    During review of the PMN submitted for the chemical substance
phenol, 2,4-dimethyl-6-(1-methylpentadecyl)-, EPA concluded that one or
more of the criteria of concern established at Sec.  721.170 were met,
as discussed in Units II. and IV. of the proposed rule (76 FR 81437).

B. Objectives

    EPA is issuing this final SNUR for a specific chemical substance
which has undergone premanufacture review because the Agency wants to
achieve the following objectives with regard to the significant new
uses designated in this final rule:
     EPA will receive notice of any person's intent to
manufacture, import, or process a listed chemical substance for the
described significant new use before that activity begins.
     EPA will have an opportunity to review and evaluate data
submitted in a SNUN before the notice submitter begins manufacturing,
importing, or processing a listed chemical substance for the described
significant new use.
     EPA will be able to regulate prospective manufacturers,
importers, or processors of a listed chemical substance before the
described significant new use of that chemical substance occurs,
provided that regulation is warranted pursuant to TSCA sections 5(e),
5(f), 6, or 7.
    Issuance of a SNUR for a chemical substance does not signify that
the chemical substance is listed on the TSCA Inventory. Guidance on how
to determine if a chemical substance is on the TSCA Inventory is
available on the Internet at http://www.epa.gov/opptintr/existingchemicals/pubs/tscainventory/index.html.

IV. Significant New Use Determination

    Section 5(a)(2) of TSCA states that EPA's determination that a use
of a chemical substance is a significant new use must be made after
consideration of all relevant factors, including:
     The projected volume of manufacturing and processing of a
chemical substance.
     The extent to which a use changes the type or form of
exposure of human beings or the environment to a chemical substance.
     The extent to which a use increases the magnitude and
duration of exposure of human beings or the environment to a chemical
substance.
     The reasonably anticipated manner and methods of
manufacturing, processing, distribution in commerce, and disposal of a
chemical substance.
    In addition to these factors enumerated in TSCA section 5(a)(2),
the statute authorized EPA to consider any other relevant factors.
    To determine what would constitute a significant new use for the
chemical substance that is the subject to this final SNUR, EPA
considered relevant information about the toxicity of the chemical
substance, likely human exposure and environmental releases associated
with possible uses, taking into consideration the four bulleted TSCA
section 5(a)(2) factors listed in this unit, and the regulations at
Sec.  721.170 for issuing a SNUR after receipt of a PMN.

V. Applicability of Rule to Uses Occurring Before Effective Date of the
Final Rule

    As discussed in the Federal Register issue of April 24, 1990 (55 FR
17376), EPA has decided that the intent of TSCA section 5(a)(1)(B) is
best served by designating a use as a significant new use as of the
date of publication of the proposed rule rather than as of the
effective date of the final rule. If uses begun after publication were
considered ongoing rather than new, it would be difficult for EPA to
establish SNUR notice requirements because a person could defeat the
SNUR by initiating the significant new use before the rule became
effective, and then argue that the use was ongoing before the effective
date of the final rule.
    Any person who began commercial manufacture, import, or processing
of the chemical substance for any of the significant new uses
designated in the proposed rule after the date of publication of the
proposed rule must stop that activity before the effective date of this
final rule. To resume their activities, these persons would have to
comply with all applicable SNUR notice requirements and wait until the
notice review period, including any extensions expires.
    EPA has promulgated provisions to allow persons to comply with this
SNUR before the effective date. If a person meets the conditions of
advance compliance under Sec.  721.45(h), the person is considered
exempt from the requirements of the SNUR.

VI. Test Data and Other Information

    EPA recognizes that TSCA section 5 does not require developing any
particular test data before submission of a SNUN. The two exceptions
are:

    1. Development of test data is required where the chemical
substance subject to the SNUR is also subject to a test rule under TSCA
section 4 (see TSCA section 5(b)(1)).
    2. Development of test data may be necessary where the chemical
substance has been listed under TSCA section 5(b)(4) (see TSCA section
5(b)(2)).
    In the absence of a TSCA section 4 test rule or a TSCA section
5(b)(4) listing covering the chemical substance, persons are required
only to submit test data in their possession or control and to describe
any other data known to or reasonably ascertainable by them (see Sec.
720.50). However, upon review of PMNs and SNUNs, the Agency has the
authority to require appropriate testing. Unit IV. of the proposed rule
lists the testing recommended by EPA for the chemical substance phenol,
2,4 dimethyl-6-(1-methylpentadecyl)-. Specifically, EPA has determined
that a dermal absorption study (Office of Pollution Prevention and
Toxics (OPPTS) Test Guideline 870.3250) would help characterize the
health effects of the PMN substance. Descriptions of tests are provided
for informational purposes. EPA strongly encourages persons, before
performing any testing, to consult with the Agency pertaining to
protocol selection and test reporting. To access the harmonized test
guidelines referenced in this document electronically, please go to
http://www.epa.gov/ocspp and select ``Test Methods and Guidelines.''
    The recommended tests may not be the only means of addressing the
potential risks of the chemical substance. However, submitting a SNUN
without any test data may increase the likelihood that EPA will take
action under TSCA section 5(e), particularly if satisfactory test
results have not been obtained from a prior PMN or SNUN submitter. EPA
recommends that potential SNUN submitters contact EPA early enough so
that they will be able to conduct the appropriate tests.
    SNUN submitters should be aware that EPA will be better able to
evaluate SNUNs which provide detailed information on the following:
     Human exposure and environmental release that may result
from the significant new use of the chemical substances.
     Potential benefits of the chemical substances.
     Information on risks posed by the chemical substances
compared to risks posed by potential substitutes.

VII. SNUN Submissions

    According to Sec.  [emsp14]721.1(c), persons submitting a SNUN must
comply with the same notice requirements and EPA regulatory procedures
as persons submitting a PMN, including submission of test data on
health and environmental effects as described in Sec.  720.50. SNUNs
must be submitted on EPA Form No. 7710-25, generated using e-PMN
software, and submitted to the Agency in accordance with the procedures
set forth in Sec. Sec.  721.25 and 720.40. E-PMN software is available
electronically at http://www.epa.gov/opptintr/newchems.

VIII. Economic Analysis

    EPA has evaluated the potential costs of establishing SNUN
requirements for potential manufacturers, importers, and processors of
the chemical substance subject to this final rule. EPA's complete
economic analysis is available in the docket under docket ID number
EPA-HQ-OPPT-2011-0633.

IX. Statutory and Executive Order Reviews

A. Executive Order 12866

    This final rule establishes a SNUR for a chemical substance that
was the subject of a PMN. 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).

B. Paperwork Reduction Act

    According to the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et
seq., an Agency may not conduct or sponsor, and a person is not
required to respond to a collection of information that requires OMB
approval under PRA, unless it has been approved by OMB and displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in title 40 of the CFR, after appearing in the Federal
Register, are listed in 40 CFR part 9, and included on the related
collection instrument or form, if applicable. EPA is amending the table
in 40 CFR part 9 to list the OMB approval number for the information
collection requirements contained in this final rule. This listing of
the OMB control numbers and their subsequent codification in the CFR
satisfies the display requirements of PRA and OMB's implementing
regulations at 5 CFR part 1320. This Information Collection Request
(ICR) was previously subject to public notice and comment prior to OMB
approval, and given the technical nature of the table, EPA finds that
further notice and comment to amend it is unnecessary. As a result, EPA
finds that there is ``good cause'' under section 553(b)(3)(B) of the
Administrative Procedure Act, 5 U.S.C. 553(b)(3)(B), to amend this
table without further notice and comment.
    The information collection requirements related to this action have
already been approved by OMB pursuant to PRA under OMB control number
2070-0012 (EPA ICR No. 574). This action would not impose any burden
requiring additional OMB approval. If an entity were to submit a SNUN
to the Agency, the annual burden is estimated to average between 30 and
170 hours per response. This burden estimate includes the time needed
to review instructions, search existing data sources, gather and
maintain the data needed, and complete, review, and submit the required
SNUN.
    Send any comments about the accuracy of the burden estimate, and
any suggested methods for minimizing respondent burden, including
through the use of automated collection techniques, to the Director,
Collection Strategies Division, Office of Environmental Information
(2822T), Environmental Protection Agency, 1200 Pennsylvania Ave., NW.,
Washington, DC 20460-0001. Please remember to include the OMB control
number in any correspondence, but do not submit any completed forms to
this address.

C. Regulatory Flexibility Act

    On February 18, 2012, EPA certified pursuant to section 605(b) of
the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), that
promulgation of a SNUR does not have a significant economic impact on a
substantial number of small entities where the following are true:
    1. A significant number of SNUNs would not be submitted by small
entities in response to the SNUR.
    2. The SNUN submitted by any small entity would not cost
significantly more than $8,300.
    A copy of that certification is available in the docket for this
rule.
    This rule is within the scope of the February 18, 2012
certification. Based on the economic analysis discussed in Unit VIII.
and EPA's experience promulgating SNURs (discussed in the
certification), EPA believes that the following are true:
     A significant number of SNUNs would not be submitted by
small entities in response to the SNUR.
     Submission of the SNUN would not cost any small entity
significantly more than $8,300. Therefore, the promulgation of the SNUR
would not have a significant economic impact on a substantial number of
small entities.

D. Unfunded Mandates Reform Act

    Based on EPA's experience with proposing and finalizing SNURs,
State, local, and Tribal governments have not been impacted by these
rulemakings, and EPA does not have any reasons to believe that any
State, local, or Tribal government will be impacted by this final rule.
As such, EPA has determined that this final rule does not impose any
enforceable duty, contain any unfunded mandate, or otherwise have any
effect on small governments subject to the requirements of sections
202, 203, 204, or 205 of the Unfunded Mandates Reform Act of 1995
(UMRA) (Pub. L. 104-4).

E. Executive Order 13132

    This action will not have a substantial direct effect on 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, as specified in Executive Order 13132, entitled
Federalism (64 FR 43255, August 10, 1999).

F. Executive Order 13175

    This final rule does not have Tribal implications because it is not
expected to have substantial direct effects on Indian Tribes. This
final rule does not significantly nor uniquely affect the communities
of Indian Tribal governments, nor does it involve or impose any
requirements that affect Indian Tribes. Accordingly, the requirements
of Executive Order 13175, entitled Consultation and Coordination With
Indian Tribal Governments (65 FR 67249, November 9, 2000) do not apply
to this final rule.

G. Executive Order 13045

    This action is not subject to Executive Order 13045, entitled
Protection of Children From Environmental Health Risks and Safety Risks
(62 FR 19885, April 23, 1997), because this is not an economically
significant regulatory action as defined by Executive Order 12866, and
this action does not address environmental health or safety risks
disproportionately affecting children.

H. Executive Order 13211

    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), because this action
is not expected to affect energy supply, distribution, or use and
because this action is not a significant regulatory action under
Executive Order 12866.

I. National Technology Transfer and Advancement Act

    In addition, since this action does not involve any technical
standards, section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15
U.S.C. 272 note), does not apply to this action.

J. Executive Order 12898

    This action does not entail special considerations of environmental
justice related issues as delineated by Executive Order 12898, entitled
Federal Actions To Address Environmental Justice in Minority
Populations and Low-Income Populations (59 FR 7629, February 16, 1994).

X. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report to each House of the Congress and
the Comptroller General of the United States. 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 rule is not a ``major rule'' as defined by 5 U.S.C. 804(2).

List of Subjects

40 CFR Part 9

    Environmental protection, Reporting and recordkeeping requirements.

40 CFR Part 721

    Environmental protection, Chemicals, Hazardous substances,
Reporting and recordkeeping requirements.

    Dated: June 30, 2012.
Maria J. Doa,
Director, Chemical Control Division, Office of Pollution Prevention and
Toxics.

    Therefore, 40 CFR parts 9 and 721 are amended as follows:

PART 9--[AMENDED]

0
1. The authority citation for part 9 continues to read as follows:

    Authority:  7 U.S.C. 135 et seq., 136-136y; 15 U.S.C. 2001,
2003, 2005, 2006, 2601-2671; 21 U.S.C. 331j, 346a, 348; 31 U.S.C.
9701; 33 U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318, 1321, 1326,
1330, 1342, 1344, 1345 (d) and (e), 1361; E.O. 11735, 38 FR 21243, 3
CFR, 1971-1975 Comp. p. 973; 42 U.S.C. 241, 242b, 243, 246, 300f,
300g, 300g-1, 300g-2, 300g-3, 300g-4, 300g-5, 300g-6, 300j-1, 300j-
2, 300j-3, 300j-4, 300j-9, 1857 et seq., 6901-6992k, 7401-7671q,
7542, 9601-9657, 11023, 11048.

0
2. The table in Sec.  9.1 is amended by adding the following section in
numerical order under the undesignated center heading ``Significant New
Uses of Chemical Substances'' to read as follows:

Sec.  9.1  OMB approvals under the Paperwork Reduction Act.

* * * * *

------------------------------------------------------------------------
                   40 CFR Citation                      OMB Control No.
------------------------------------------------------------------------

                                * * * * *
------------------------------------------------------------------------
               Significant New Uses of Chemical Substances
------------------------------------------------------------------------
                                * * * * *
721.5725............................................           2070-0012

                                * * * * *
------------------------------------------------------------------------

* * * * *

PART 721--[AMENDED]

0
3. The authority citation for part 721 continues to read as follows:

    Authority:  15 U.S.C. 2604, 2607, and 2625(c).

0
4. Add Sec.  721.5725 to subpart E to read as follows:

Sec.  [emsp14]721.5725  Phenol, 2,4-dimethyl-6-(1-methylpentadecyl)-.

    (a) Chemical substance and significant new uses subject to
reporting. (1) The chemical substance identified as phenol, 2,4-
dimethyl-6-(1-methylpentadecyl)- (PMN P-94-209; CAS No. 134701-20-5) is
subject to reporting under this section for the significant new uses
described in paragraph (a)(2) of this section. The requirements of this
rule do not apply to quantities of the PMN substance after it has been
completely reacted (cured); embedded or incorporated into a polymer
matrix that has been reacted (cured); or embedded, encapsulated, or
incorporated into a permanent solid matrix (does not include slurries)
that is not intended to undergo further processing, except for
mechanical processing.
    (2) The significant new uses are:
    (i) Protection in the workplace. Requirements as specified in Sec.
721.63 (a)(2)(i), (a)(3), and (b) (concentration set at 1.0 percent).
    (ii) [Reserved]
    (b) Specific requirements. The provisions of subpart A of this part
apply to this section except as modified by this paragraph.
    (1) Recordkeeping. Recordkeeping requirements as specified in Sec.
721.125

(a), (b), (c), (d), and (e) are applicable to manufacturers, importers,
and processors of this substance.
    (2) Limitations or revocation of certain notification requirements.
The provisions of Sec.  721.185 apply to this section.

[FR Doc. 2012-17276 Filed 7-13-12; 8:45 am]
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[Federal Register Volume 76, Number 68 (Friday, April 8, 2011)]
[Notices]
[Page 19766]
[FR Doc No: 2011-8392]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER11-2256-000]

California Independent System Operator Corporation; Notice of
Technical Conference

    By order dated March 17, 2011, in Docket No. ER11-2256-000, the
Federal Energy Regulatory Commission (Commission) directed staff to
convene a technical conference regarding California Independent System
Operator Corporation's (CAISO) Capacity Procurement Mechanism (CPM) and
exceptional dispatch mitigation provisions.\1\ Take notice that such
conference will be held on April 28, 2011 at the Commission's
headquarters at 888 First Street, NE., Washington, DC 20426, beginning
at 9 a.m. (EDT) in the Commission Meeting Room (Room 2C). The technical
conference will be led by Commission staff.
---------------------------------------------------------------------------

    \1\ Cal. Indep. Trans. Sys. Op. Corp., 134 FERC ] 61,211, at P 2
(2011).
---------------------------------------------------------------------------

    The purpose of the technical conference is to discuss the issues
raised by CAISO's proposed CPM compensation methodology and
continuation of the existing exceptional dispatch market power
mitigation provisions. A subsequent notice detailing the topics to be
discussed will be issued in advance of the conference.
    FERC conferences are accessible under section 508 of the
Rehabilitation Act of 1973. For accessibility accommodations please
send an e-mail to<EMAIL_ADDRESS>or call toll free 1-866-208-
3372 (voice) or<PHONE_NUMBER> (TTY); or send a fax to<PHONE_NUMBER> with
the required accommodations.
    All parties are permitted to attend. For more information on this
conference, please contact Katheryn Hoke at<EMAIL_ADDRESS>or
(202) 502-8404, or Colleen Farrell at<EMAIL_ADDRESS>or (202)
502-6751.

    Dated: April 1, 2011.
Kimberly D. Bose,
Secretary.
[FR Doc. 2011-8392 Filed 4-7-11; 8:45 am]
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