[Federal Register Volume 83, Number 16 (Wednesday, January 24, 2018)]
[Notices]
[Pages 3380-3387]
[FR Doc No: 2018-01209]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82532; File No. SR-NYSEArca-2018-02]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change Relating to Listing and Trading of the Direxion
Daily Bitcoin Bear 1X Shares, Direxion Daily Bitcoin 1.25X Bull Shares,
Direxion Daily Bitcoin 1.5X Bull Shares, Direxion Daily Bitcoin 2X Bull
Shares and Direxion Daily Bitcoin 2X Bear Shares Under NYSE Arca Rule
8.200-E

January 18, 2018.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on January 4, 2018, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to list and trade the shares of the following
under NYSE Arca Rule 8.200-E, Commentary .02 (``Trust Issued
Receipts''): Direxion Daily Bitcoin Bear 1X Shares, Direxion Daily
Bitcoin 1.25X Bull Shares, Direxion Daily Bitcoin 1.5X Bull Shares,
Direxion Daily Bitcoin 2X Bull Shares and Direxion Daily Bitcoin 2X
Bear Shares. The proposed change is available on the Exchange's website
at www.nyse.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 self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

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

1. Purpose
    The Exchange proposes to list and trade shares (``Shares'') of the
following under NYSE Arca Rule 8.200-E, Commentary .02, which governs
the listing and trading of Trust Issued Receipts: The Direxion Daily
Bitcoin Bear 1X Shares (the ``1X Bear Fund''), the Direxion Daily
Bitcoin 1.25X Bull Shares (the ``1.25X Bull Fund''), the Direxion Daily
Bitcoin 1.5X Bull Shares (the ``1.5X Bull Fund''), the Direxion Daily
Bitcoin 2X Bull Shares (the ``2X Bull Fund'') and the Direxion Daily
Bitcoin 2X Bear Shares (the ``2X Bear Shares'') (each a ``Fund'' and,
collectively, the ``Funds'').\4\
---------------------------------------------------------------------------

    \4\ Commentary .02 to NYSE Arca Rule 8.200-E applies to Trust
Issued Receipts that invest in ``Financial Instruments.'' The term
``Financial Instruments,'' as defined in Commentary .02(b)(4) to
NYSE Arca Rule 8.200-E, means any combination of investments,
including cash; securities; options on securities and indices;
futures contracts; options on futures contracts; forward contracts;
equity caps, collars, and floors; and swap agreements.
---------------------------------------------------------------------------

    Each Fund is a series of the Direxion Shares ETF Trust II (the
``Trust''), a Delaware statutory trust.\5\ The Trust and the Funds are
managed and controlled by Direxion Asset Management, LLC (the
``Sponsor''). The Sponsor is registered as a commodity pool operator
(``CPO'') with the Commodity Futures Trading Commission (``CFTC'') and
is a member of the National Futures Association (``NFA'').
---------------------------------------------------------------------------

    \5\ The Trust is registered under the Securities Act of 1933. On
December 15, 2017, the Trust submitted to the Securities and
Exchange Commission (``Commission'') its draft registration
statement on Form S-1 (the ``Registration Statement'') under the
Securities Act of 1933 (15 U.S.C. 77a) (``Securities Act''). The
Jumpstart Our Business Startups Act, enacted on April 5, 2012, added
Section 6(e) to the Securities Act. Section 6(e) of the Securities
Act provides that an ``emerging growth company'' may confidentially
submit to the Commission a draft registration statement for
confidential, non-public review by the Commission staff prior to
public filing, provided that the initial confidential submission and
all amendments thereto shall be publicly filed not later than 21
days before the date on which the issuer conducts a road show, as
such term is defined in Securities Act Rule 433(h)(4). An emerging
growth company is defined in Section 2(a)(19) of the Securities Act
as an issuer with less than $1,000,000,000 total annual gross
revenues during its most recently completed fiscal year. The Trust
meets the definition of an emerging growth company and consequently
has submitted its Form S-1 Registration Statement on a confidential
basis with the Commission. The description of the operation of the
Trust and the Funds herein is based, in part, on the Registration
Statement.
---------------------------------------------------------------------------

    In its capacity as the Custodian for the Funds, Bank of New York
Mellon (``BNYM'' or the ``Custodian'') may hold the Funds' investment
assets and cash and cash equivalents pursuant to a custodian agreement.
The Custodian is also the transfer agent for the Funds. In addition, in
its capacity as Administrator for the Funds, U.S. Bancorp Fund
Services, LLC (the ``Administrator'') prepares and files certain
regulatory filings on behalf of the Funds.
    Foreside Fund Services, LLC serves as the distributor of the Shares
(the ``Distributor'').
Investment Objectives of the Funds
    According to the Registration Statement, the Funds will offer
investors the opportunity to obtain daily short, leveraged long or
leveraged short exposure to the lead month bitcoin futures contract
traded on the Chicago Mercantile Exchange (``CME'') or on Cboe Global
Markets, Inc. (``CBOE'') or on any other U.S. exchange that
subsequently trades bitcoin futures contracts (the ``Bitcoin Futures
Contract''), the target benchmark before fees and expenses.\6\ The
target benchmark's value will be calculated as the last sale price
published by the CME or the CBOE,\7\ or any other U.S. exchange that
subsequently trades bitcoin futures contracts on or before 11:00 a.m.
E.T. (the ``Daily Last Sale Value'') for the Bitcoin Futures Contract
and may reflect trades occurring and published by the CME and/or CBOE
or another U.S. exchange that subsequently trades bitcoin futures
contracts outside the normal trading session for the Bitcoin Futures
Contract.\8\
---------------------------------------------------------------------------

    \6\ A futures contract is a standardized contract traded on, and
subject to the rules of, an exchange that calls for the future
delivery of a specified quantity and type of a commodity at a
specified time and place. Bitcoin Futures Contracts will be cash-
settled. The ``lead month'' contract is the monthly contract with
the earliest expiration date.
    \7\ The CME and CBOE are registered with the CFTC and seek to
provide a neutral, regulated marketplace for the trading of
derivatives contracts for commodities, such as futures, options and
certain swaps. Both the CME and CBOE are members of the Intermarket
Surveillance Group (``ISG''). See ftnt. 19, infra. The CME announced
that its bitcoin futures contracts were scheduled to begin trading
on December 18, 2017, and began trading on that date. See ``CME
Group Self-Certifies Bitcoin Futures to Launch Dec. 18,'' December
1, 2017, available at http://www.cmegroup.com/media-room/press-releases/2017/12/01/cme_group_self-certifiesbitcoinfuturestolaunchdec18.html. CBOE announced that the
bitcoin futures contracts on its subsidiary Cboe Futures Exchange
are scheduled to begin trading on December 10, 2017, and began
trading on that date. See ``Cboe Plans December 10 Launch of Bitcoin
Futures Trading,'' December 4, 2017, available at http://ir.cboe.com/press-releases/2017/12-04-2017. See also ``CFTC
Statement on Self-Certification of Bitcoin Products by CME, CFE and
Cantor Exchange,'' dated December 1, 2017 (``CFTC Release''),
available at http://www.cftc.gov/PressRoom/PressReleases/pr7654-17.
    \8\ Though this time may vary due to differences in when
daylight savings time is effective between London and New York,
11:00 a.m. E.T. will govern.
---------------------------------------------------------------------------

    Each Fund will seek daily correlation to the target benchmark and
should not be expected to track the performance of the target benchmark
for any period longer than one business day. Additionally, while each
Fund will seek daily correlation to the target benchmark, it should not
be expected to track dollar for dollar the spot price of bitcoin
because the Fund will invest in Bitcoin Futures Contracts rather than
directly in bitcoin, and the spot price movements of bitcoin may not
correspond directly to price movements of the Bitcoin Futures
Contracts. In this regard, the Funds expect the notional value of the
Bitcoin Futures Contracts held by a Fund to equal the target exposure
for such Fund (i.e., 125%, 150%, etc.).
    Each Fund will seek to engage in daily rebalancing to position its
portfolio so that its exposure to the target benchmark is consistent
with its daily investment objective. The impact of the target
benchmark's movements during the day will affect whether a Fund's
portfolio needs to be repositioned.\9\
---------------------------------------------------------------------------

    \9\ Daily rebalancing and the compounding of each day's return
over time means that the return of each Fund for a period longer
than a single trading day will be the result of each day's returns
compounded over the period, which will very likely differ from
either the multiple, inverse multiple or inverse, as applicable, of
the return of the target benchmark for the Funds for the same
period.
---------------------------------------------------------------------------

    As described below, under normal market conditions, each Fund
intends to obtain exposure to its target benchmark by investing in the
Bitcoin Futures Contract traded in the U.S., swaps on the Bitcoin
Futures Contract or listed options on bitcoin or Bitcoin Futures
Contracts (together,''Bitcoin Financial Instruments'').\10\ The Funds'

investments in Bitcoin Financial Instruments are used to produce
economically ``leveraged'' or ``inverse leveraged'' investment results
for the Funds. Any remaining assets will be invested in cash or cash
equivalents.
---------------------------------------------------------------------------

    \10\ The term ``normal market conditions'' includes, but is not
limited to, the absence of trading halts in the applicable financial
markets generally; operational issues (e.g., systems failure)
causing dissemination of inaccurate market information; or force
majeure type events such as natural or manmade disaster, act of God,
armed conflict, act of terrorism, riot or labor disruption or any
similar intervening circumstance.
---------------------------------------------------------------------------

Investment Objectives of the Leveraged Bull Funds
    According to the Registration Statement, the 1.25X Bull Fund, 1.5X
Bull Fund and 2X Bull Fund (each a ``Bull Fund'' and collectively, the
``Bull Funds'') seeks daily leveraged investment results (before fees
and expenses) that correlate positively to either 125%, 150% or 200%
the daily return of the target benchmark. The Bull Funds do not seek to
achieve their investment objective over a period greater than a single
trading day.\11\ If a Bull Fund is successful in meeting its objective,
its value on a given day (before fees and expenses) should gain
approximately 1.25 times, 1.5 times or 2 times, as applicable, as much
on a percentage basis as the level of its target benchmark when the
target benchmark rises. Conversely, its value on a given day (before
fees and expenses) should lose approximately 1.25 times, 1.5 times or 2
times, as applicable, as much on a percentage basis as the level of the
target benchmark when the benchmark declines. Each Bull Fund acquires
long exposure through any one of, or combinations of, Bitcoin Financial
Instruments, including Bitcoin Financial Instruments with respect to
the target benchmark, such that each Bull Fund has exposure intended to
approximate either 125%, 150% or 200%, as applicable, of the target
benchmark at the time of its NAV calculation.
---------------------------------------------------------------------------

    \11\ A ``single trading day'' is measured from the time a Fund
calculates its Net Asset Value (``NAV'') to the time of a Fund's
next NAV calculation. See also, Net Asset Value, infra.
---------------------------------------------------------------------------

Investment Objective of the 2X Bear Fund
    The 2X Bear Fund seeks daily leveraged inverse investment results
(before fees and expenses) that correlate to two times the inverse (-
200%) of the daily return of the target benchmark. The 2X Bear Fund
does not seek to achieve its investment objective over a period greater
than a single trading day. If the 2X Bear Fund is successful in meeting
its investment objective, its value on a given day (before fees and
expenses) should gain approximately two times as much on a percentage
basis as the level of the target benchmark when the target benchmark
declines. Conversely, its value on a given day (before fees and
expenses) should lose approximately two times as much on a percentage
basis as the level of the target benchmark when the target benchmark
rises. The 2X Bear Fund acquires short exposure through any one, or
combinations of, Bitcoin Financial Instruments, including Bitcoin
Financial Instruments with respect to the target benchmark, such that
the 2X Bull Fund has exposure intended to approximate two times the
inverse (-200%) of its target benchmark at the time of its NAV
calculation.
Investment Objective of the 1X Bear Fund
    The 1X Bear Fund seeks daily investment results (before fees and
expenses) that correlate to the inverse (-100%) of the daily return of
the target benchmark. The 1X Bear Fund does not seek to achieve its
investment objective over a period greater than a single trading day.
If the 1X Bear Fund is successful in meeting its investment objective,
its value on a given day (before fees and expenses) should gain
approximately as much on a percentage basis as the level of the target
benchmark when the target benchmark declines. Conversely, its value on
a given day (before fees and expenses) should lose approximately as
much on a percentage basis as the level of its target benchmark when
the target benchmark rises. The 1X Bear Fund acquires short exposure
through any one of, or combinations of, Bitcoin Financial Instruments,
including Bitcoin Financial Instruments with respect to the target
benchmark, such that the 1X Bull Fund has exposure intended to
approximately equal the inverse (-100%) of its target benchmark at the
time of its NAV calculation.
Principal Investment Strategies
    According to the Registration Statement, in seeking to achieve each
Fund's daily investment objective, the Sponsor will use statistical and
quantitative analysis to determine the investments each Fund makes and
the techniques it employs. Using this approach, the Sponsor determines
the type, quantity and mix of investment positions that the Sponsor
believes in combination should produce daily returns consistent with a
Fund's investment objective. The Sponsor relies upon a pre-determined
model to generate orders that result in repositioning each Fund's
investments in accordance with its daily investment objective. As a
consequence, if a Fund is performing as designed, the return of the
target benchmark will dictate the return for that Fund. Each Fund
pursues its investment objective regardless of the market conditions
and does not take defensive positions.
    Each Fund, under normal market conditions, will seek to achieve its
daily investment objective by investing in Bitcoin Financial
Instruments. A Fund may invest in listed options on bitcoin and Bitcoin
Futures Contracts and swaps on Bitcoin Futures Contracts in a manner
consistent with its investment objective in situations where the
Sponsor believes that investing in such financial instruments is in the
best interests of a Fund. In addition, a Fund may invest in swap
contracts referencing Bitcoin Futures Contracts if the market for a
specific bitcoin futures contract experiences emergencies or if
position price or accountability limits (if any) are reached with
respect to any Bitcoin Futures Contracts. At the close of the U.S.
equity markets each trading day, each Fund will position its portfolio
to ensure that the Fund's exposure to the target benchmark is
consistent with the Fund's investment objective. The impact of market
movements during the day will determine whether a portfolio needs to be
repositioned.
    According to the Registration Statement, with futures contracts,
there is minimal but some counterparty risk to the Funds since futures
contracts are exchange traded and the exchange's clearinghouse, as
counterparty to all exchange-traded futures contracts, effectively
guarantees futures contracts against default. Many futures exchanges
and boards of trade limit the amount of fluctuation permitted in
futures contract prices during a single trading day. Once the daily
limit has been reached in a particular contract, no trades may be made
that day at a price beyond that limit or trading may be suspended for
specified times during the trading day.
    According to the Registration Statement, with respect to the
Bitcoin Futures Contracts, as the futures contracts held by the Funds
near expiration, the Funds do not intend to hold futures contracts
through expiration, but instead to ``roll'' their respective positions.
When the market for these contracts is such that the prices are higher
in the more distant delivery months than in the nearer delivery months,
the sale during the course of the ``rolling process'' of the more
nearby contract would take place at a price that is lower than the
price of the more distant contract. This pattern of higher futures
prices for longer expiration futures contracts is often referred to as
``contango.'' Alternatively,

when the market for these contracts is such that the prices are higher
in the nearer months than in the more distant months, the sale during
the course of the ``rolling process'' of the more nearby contract would
take place at a price that is higher than the price of the more distant
contract. This pattern of higher futures prices for shorter expiration
futures contracts is referred to as ``backwardation.'' The presence of
contango in certain futures contracts at the time of rolling would be
expected to adversely affect the Funds with long positions, and
positively affect the Funds with short positions. Similarly, the
presence of backwardation in certain futures contracts at the time of
rolling such contracts would be expected to adversely affect the Funds
with short positions and positively affect the Funds with long
positions.
    To reduce the credit risk that arises in connection with swaps, a
Fund will generally enter into an agreement with each counterparty
based on the Master Agreement published by the International Swaps and
Derivatives Association, Inc.\12\
---------------------------------------------------------------------------

    \12\ The Sponsor on behalf of the corresponding Fund intends to
enter into OTC swaps only with counterparties who are, or are
affiliates of, (a) banks regulated by a federal bank regulator, (b)
broker-dealers regulated by the Commission, (c) insurance companies
domiciled in the U.S., and (d) producers, users or traders of an
underlying commodity or currency, whether or not regulated by the
CFTC. Any entity acting as a counterparty must also be regulated in
either the U.S. or the U.K. unless otherwise approved by the
Sponsor. A Fund will also require that the counterparty be highly
rated and/or provide collateral or other credit support. The Sponsor
also assesses or reviews, as appropriate, the creditworthiness of
each potential or existing counterparty pursuant to established
guidelines.
---------------------------------------------------------------------------

    Assets of each Fund not invested in the Bitcoin Financial
Instruments will be held in cash or invested in cash equivalents such
as U.S. Treasury Securities or other high credit quality short- term
fixed-income or similar securities (including shares of money market
funds, bank deposits, bank money market accounts, certain variable
rate-demand notes and repurchase agreements collateralized by
government securities) (collectively ''Money Market Investments'') that
serve as collateral for, or pending investments in, the Funds'
investments.
    In the future, the Funds will disclose certain information relating
to margin levels held at the FCM based on how each Fund will be
managed. While the portfolio composition may vary over time, it is not
expected that any Fund will ever have futures exposure greater than
300% of Fund assets. Thus the maximum margin held at an FCM would not
exceed three times the margin requirement.
Overview of Bitcoin
    According to the Registration Statement, Bitcoin is a digital asset
that is not issued by any government, bank or organization. Bitcoin is
a digital asset based on the decentralized, open source protocol of the
peer-to-peer bitcoin computer network (the ``Bitcoin Network''). No
single entity owns or operates the Bitcoin Network; the infrastructure
is collectively maintained by a decentralized user base. The Bitcoin
Network is accessed through software, and software governs bitcoin's
creation, movement, and ownership. The value of bitcoin is determined
by the supply and demand for bitcoin on websites that facilitate the
transfer of bitcoin in exchange for government-issued currencies
(``Bitcoin Exchanges''), and in private end-user-to-end-user
transactions.
    Bitcoin transactions and ownership records are reflected on the
``Blockchain'', which is a digital public record or ledger. Copies of
this ledger are stored in a decentralized manner on the computers of
each Bitcoin Network user. Transaction date is permanently recorded in
files called ``blocks,'' which reflect transactions that have been
recorded and authenticated by Bitcoin Network participants. The Bitcoin
Network software source codes includes protocols that govern the
creation of bitcoin and the cryptographic system that secures and
verifies Bitcoin transactions.
Overview of Bitcoin Futures Contracts
    According to the Registration Statement, unlike the futures markets
for traditional physical commodities, the market for exchange-traded
bitcoin futures contract has limited trading history and operational
experience and may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than more
established futures markets. The liquidity of the market will depend
on, among other things, the adoption of bitcoin and the commercial and
speculative interest in the market for the ability to hedge against the
price of bitcoin with exchange-traded bitcoin futures contracts.
    The CFTC has noted that the U.S. futures exchanges that will trade
bitcoin futures have agreed to significant enhancements to protect
customers and maintain orderly markets, and announced its expectation
that futures exchanges that list and trade bitcoin futures contracts
will, through information sharing agreements, monitor the trading
activity on the relevant cash platforms for potential impacts on the
price discovery process for bitcoin futures contracts, including
potential market manipulation and market dislocations due to flash
rallies and crashes and trading outages.\13\
---------------------------------------------------------------------------

    \13\ See CFTC Release, supra, ftnt. 7.
---------------------------------------------------------------------------

Net Asset Value
    According to the Registration Statement, the NAV per Share of each
Fund is computed by dividing the value of the net assets of such Fund
(i.e., the value of its total assets less total liabilities) by its
total number of Shares outstanding. Expenses and fees are accrued daily
and taken into account for purposes of determining NAV. Each Fund's NAV
is calculated on each business day that the New York Stock Exchange LLC
(``NYSE'') is open. The Funds compute their NAVs as of 11:00 a.m. E.T.,
or such earlier time that the NYSE may close.
    In calculating the NAV of a Fund, the settlement value of a Fund's
non-exchange traded Bitcoin Financial Instruments is determined by
applying the then-current prices for the target benchmark to the terms
of such Fund's non-exchange traded Bitcoin Financial Instruments.
However, in the event that an underlying Bitcoin Futures Contract is
not trading due to the operation of daily limits or otherwise, the
Sponsor may in its sole discretion choose to fair value the Reference
Asset in order to value a Fund's non-exchange traded Bitcoin Financial
Instruments for purposes of the NAV calculation.\14\ Such fair value
prices would generally be determined based on available inputs about
the current value of the underlying Reference Assets and would be based
on principles that the Sponsor deems fair and equitable so long as such
principles are consistent with normal industry standards.
---------------------------------------------------------------------------

    \14\ The value of a futures contract is derived from the value
of an underlying asset, rate or benchmark (such asset, rate or
benchmark, a ``Reference Asset'').
---------------------------------------------------------------------------

    All open futures contracts traded on an exchange are calculated at
their then current market value, which is based upon the settlement or
the last traded price before the NAV calculation time, for that
particular futures contract traded on the applicable exchange on the
date with respect to which NAV is being determined; provided, that if a
futures contract traded on an exchange could not be liquidated on such
day, due to the operation of daily limits or other rules of the
exchange upon which that position is traded or otherwise, the Sponsor
may in its sole discretion choose to determine a fair value price as

the basis for determining the market value of such position for such
day.
    Money Market Investments will be valued on the basis of broker
quotes, valuations provided by a third party pricing service or at
amortized cost.
Indicative Fund Value
    In order to provide updated information relating to the Funds for
use by investors and market professionals, the Exchange will calculate
an updated ``Indicative Fund Value'' (``IFV''). The IFV will be
calculated by using the prior day's closing net assets of a Fund as a
base and updating throughout the Exchange's Core Trading Session of
9:30 a.m. E.T. to 4:00 p.m. E.T. changes in the value of the Bitcoin
Financial Instruments held by a Fund based on the most recently
available prices for the Fund's investments.
    The IFV will be disseminated on a per Share basis every 15 seconds
during the Exchange's Core Trading Session and be widely disseminated
by one or more major market data vendors during the NYSE Arca Core
Trading Session.\15\ In addition, circumstances may arise in which the
NYSE Arca Core Trading Session is in progress, but trading in the
Bitcoin Futures Contracts is not occurring. Such circumstances may
result from reasons including, but not limited to, a futures exchange
having a separate holiday schedule than the NYSE Arca, a futures
exchange closing prior to the close of the NYSE Arca, price fluctuation
limits being reached in a Bitcoin Futures Contract, or a futures
exchange, imposing any other suspension or limitation on trading in a
Bitcoin Futures Contract. In such instances, for IFV calculation
purposes, the price of the applicable Bitcoin Futures Contracts, as
well as Bitcoin Financial Instruments whose price is derived from the
Bitcoin Futures Contracts, would be static or priced by a Fund at the
applicable early cut-off time of the exchange trading the applicable
Bitcoin Futures Contract.
---------------------------------------------------------------------------

    \15\ Several major market data vendors display and/or make
widely available IFVs taken from the CTA or other data feeds.
---------------------------------------------------------------------------

Creation and Redemption of Shares
    According to the Registration Statement, each Fund will create and
redeem Shares in one or more Creation Units. A Creation Unit is a block
of 50,000 Shares of a Fund.
    A creation transaction, which is subject to acceptance by the
Distributor, generally takes place when an Authorized Participant
deposits a specified amount of cash in exchange for a specified number
of Creation Units. Similarly, Shares can be redeemed only in Creation
Units, generally for cash.
    Only ``Authorized Participants'' may purchase and redeem Shares
from a Fund and then only in Creation Units. An Authorized Participant
is an entity that has entered into an ``Authorized Participant
Agreement'' with the Trust and the Sponsor.
Creation Procedures
    On any Business Day, an Authorized Participant may place an order
with the Distributor to create one or more Creation Units. For purposes
of processing both purchase and redemption orders, a ``Business Day''
means any day on which the NAV of a Fund is calculated. Purchase orders
must be placed by 11 a.m. E.T. or earlier if the NYSE Arca closes
before the cut-off time.
Redemption Procedures
    According to the Registration Statement, the procedures by which an
Authorized Participant can redeem one or more Creation Units mirror the
procedures for the creation of Creation Units. On any Business Day, an
Authorized Participant may place an order with the Distributor to
redeem one or more Creation Units.
    By placing a redemption order, an Authorized Participant agrees to
deliver the Creation Units to be redeemed through DTC's book-entry
system to the applicable Fund not later than noon (Eastern Time), on
the first Business Day immediately following the redemption order date
(T+1). The Sponsor reserves the right to extend the deadline for the
Fund to receive the Creation Units required for settlement up to the
second Business Day following the redemption order date (T+2).
Availability of Information
    The NAV for the Funds' Shares will be disseminated daily to all
market participants at the same time. The intraday, closing prices, and
settlement prices of the Bitcoin Futures Contracts will be readily
available from the applicable futures exchange websites, automated
quotation systems, published or other public sources, or major market
data vendors. The value of the Bitcoin Futures Contract will be
disseminated by one or more major market data vendors on at least a 15-
second delayed basis during the NYSE Arca Core Trading Session of 9:30
a.m. to 4:00 p.m. E.T.
    Complete real-time data for the Bitcoin Futures Contracts and
Options on Bitcoin Futures will be available by subscription through
on-line information services. CME and CBOE will provide delayed futures
and options on futures (once available) information on current and past
trading sessions and market news free of charge on their respective
websites. The specific contract specifications for Bitcoin Futures
Contracts would also be available on such websites, as well as other
financial informational sources. Quotation and last-sale information
regarding the Shares will be disseminated through the facilities of the
Consolidated Tape Association (``CTA''). Quotation information for
Money Market Investments and OTC swaps agreements may be obtained from
brokers and dealers who make markets in such instruments. Quotation
information for exchange-traded swaps will be available from the
applicable exchange and major market vendors. The IFV will be available
through on-line information services.
    In addition, the Funds' website, www.direxioninvestments.com, will
display the applicable end of day closing NAV. The daily holdings of
each Fund will be available on the Funds' website before 9:30 a.m. E.T.
Each Fund's total portfolio composition will be disclosed each Business
Day that NYSE Arca is open for trading, on the Funds' website. The
Funds' website will also include a form of the prospectus for the Funds
that may be downloaded. The website will include the Shares' ticker and
CUSIP information, along with additional quantitative information
updated on a daily basis for each Fund. The Funds' website will include
(1) the prior business day's reported NAV and closing price, and a
calculation of the premium and discount of the closing price or mid-
point of the bid/ask spread at the time of NAV calculation (``Bid/Ask
Price'') against the NAV; and (2) data in chart format displaying the
frequency distribution of discounts and premiums of the daily closing
price or Bid/Ask Price against the NAV, within appropriate ranges, for
at least each of the four previous calendar quarters. The website
disclosure of portfolio holdings will be made daily and will include,
as applicable, (i) the name, quantity, value, expiration and strike
price of Bitcoin Futures Contracts and Bitcoin Financial Instruments,
(ii) the value of Bitcoin Financial Instruments, and (iii) the
aggregate net value of the Money Market Investments held in each Fund's
portfolio, if applicable. The Funds' website will be publicly available
prior to the public offering of Shares and accessible at no charge.
    The spot price of bitcoin also is available on a 24-hour basis from
major market data vendors.

Trading Halts
    With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of a Fund.\16\ Trading in Shares of a Fund will
be halted if the circuit breaker parameters in NYSE Arca Rule 7.12-E
have been reached. Trading also may be halted because of market
conditions or for reasons that, in the view of the Exchange, make
trading in the Shares inadvisable.
---------------------------------------------------------------------------

    \16\ See NYSE Arca Rule 7.12-E.
---------------------------------------------------------------------------

    The Exchange may halt trading during the day in which an
interruption to the dissemination of the IFV or the value of the
Bitcoin Futures Contract occurs. If the interruption to the
dissemination of the IFV or the value of the Bitcoin Futures Contract
persists past the trading day in which it occurred, the Exchange will
halt trading no later than the beginning of the trading day following
the interruption. In addition, if the Exchange becomes aware that the
NAV with respect to the Shares is not disseminated to all market
participants at the same time, it will halt trading in the Shares until
such time as the NAV is available to all market participants.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities. Shares will trade on
the NYSE Arca Marketplace from 4 a.m. to 8 p.m. E.T. in accordance with
NYSE Arca Rule 7.34-E (Early, Core, and Late Trading Sessions). The
Exchange has appropriate rules to facilitate transactions in the Shares
during all trading sessions. As provided in NYSE Arca Rule 7.6-E, the
minimum price variation (``MPV'') for quoting and entry of orders in
equity securities traded on the NYSE Arca Marketplace is $0.01, with
the exception of securities that are priced less than $1.00 for which
the MPV for order entry is $0.0001.
    The Shares will conform to the initial and continued listing
criteria under NYSE Arca Rule 8.200-E. The trading of the Shares will
be subject to NYSE Arca Rule 8.200-E, Commentary .02(e), which sets
forth certain restrictions on Equity Trading Permit (``ETP'') Holders
acting as registered Market Makers in Trust Issued Receipts to
facilitate surveillance. The Exchange represents that, for initial and
continued listing, each Fund will be in compliance with Rule 10A-3 \17\
under the Act, as provided by NYSE Arca Rule 5.3-E. A minimum of
100,000 Shares of each Fund will be outstanding at the commencement of
trading on the Exchange.
---------------------------------------------------------------------------

    \17\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares of each Fund
will be subject to the existing trading surveillances administered by
the Exchange, as well as cross-market surveillances administered by
Financial Industry Regulatory Authority, Inc. (``FINRA'') on behalf of
the Exchange, which are designed to detect violations of Exchange rules
and applicable federal securities laws.\18\ The Exchange represents
that these procedures are adequate to properly monitor Exchange trading
of the Shares in all trading sessions and to deter and detect
violations of Exchange rules and federal securities laws applicable to
trading on the Exchange.
---------------------------------------------------------------------------

    \18\ FINRA conducts cross-market surveillances on behalf of the
Exchange pursuant to a regulatory services agreement. The Exchange
is responsible for FINRA's performance under this regulatory
services agreement.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Shares and certain
Bitcoin Futures Contracts with other markets and other entities that
are members of the ISG, and the Exchange or FINRA, on behalf of the
Exchange, or both, may obtain trading information regarding trading in
the Shares and certain Bitcoin Futures Contracts from such markets and
other entities. In addition, the Exchange may obtain information
regarding trading in the Shares and certain Bitcoin Futures Contracts
from markets and other entities that are members of ISG or with which
the Exchange has in place a comprehensive surveillance sharing
agreement (``CSSA'').\19\ The Exchange is also able to obtain
information regarding trading in the Shares, futures, the commodity
underlying futures or options on futures through ETP Holders, in
connection with such ETP Holders' proprietary or customer trades which
they effect through ETP Holders on any relevant market. The Exchange
can obtain market surveillance information, including customer identity
information, with respect to transactions (including transactions in
cash-settled Options) occurring on US futures exchanges, which are
members of the ISG.
---------------------------------------------------------------------------

    \19\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of a
Fund may trade on markets that are members of ISG or with which the
Exchange has in place a CSSA.
---------------------------------------------------------------------------

    In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
    All statements and representations made in this filing regarding
(a) the description of the portfolios of the Funds or the target
benchmark, (b) limitations on portfolio holdings, reference assets or
the target benchmark, or (c) the applicability of Exchange listing
rules specified in this rule filing shall constitute continued listing
requirements for listing the Shares on the Exchange.
    The issuer has represented to the Exchange that it will advise the
Exchange of any failure by the Funds to comply with the continued
listing requirements, and, pursuant to its obligations under Section
19(g)(1) of the Act, the Exchange will monitor for compliance with the
continued listing requirements. If a Fund is not in compliance with the
applicable listing requirements, the Exchange will commence delisting
procedures under NYSE Arca Rule 5.5-E(m).
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its
ETP Holders in an Information Bulletin of the special characteristics
and risks associated with trading the Shares. Specifically, the
Information Bulletin will discuss the following: (1) The risks involved
in trading the Shares during the Early and Late Trading Sessions when
an updated IFV will not be calculated or publicly disseminated; (2) the
procedures for purchases and redemptions of Shares in Creation Units
(and that Shares are not individually redeemable); (3) NYSE Arca Rule
9.2-E(a), which imposes a duty of due diligence on its ETP Holders to
learn the essential facts relating to every customer prior to trading
the Shares; (4) how information regarding the IFV is disseminated; (5)
how information regarding portfolio holdings is disseminated; (6) that
a static IFV will be disseminated, between the close of trading on the
CME and CBOE and the close of the NYSE Arca Core Trading Session; (7)
the requirement that ETP Holders deliver a prospectus to investors
purchasing newly issued Shares prior to or concurrently with the

confirmation of a transaction; and (8) trading information.
    Prior to the commencement of trading, the Exchange will inform its
ETP Holders of the suitability requirements of NYSE Arca Rule 9.2-E(a)
in an Information Bulletin. Specifically, ETP Holders will be reminded
in the Information Bulletin that, in recommending transactions in the
Shares, they must have a reasonable basis to believe that (1) the
recommendation is suitable for a customer given reasonable inquiry
concerning the customer's investment objectives, financial situation,
needs, and any other information known by such ETP Holder, and (2) the
customer can evaluate the special characteristics, and is able to bear
the financial risks, of an investment in the Shares. In connection with
the suitability obligation, the Information Bulletin will also provide
that ETP Holders must make reasonable efforts to obtain the following
information: (1) The customer's financial status; (2) the customer's
tax status; (3) the customer's investment objectives; and (4) such
other information used or considered to be reasonable by such ETP
Holder or registered representative in making recommendations to the
customer.
    Further, the Exchange states that FINRA has implemented increased
sales practice and customer margin requirements for FINRA members
applicable to inverse, leveraged and inverse leveraged securities
(which include the Shares) and options on such securities, as described
in FINRA Regulatory Notices 09-31 (June 2009), 09-53 (August 2009), and
09-65 (November 2009) (collectively, ``FINRA Regulatory Notices''). ETP
Holders that carry customer accounts will be required to follow the
FINRA guidance set forth in these notices. As noted above, the Funds
will seek investment results that daily short, leverage long or
leverage short the performance of the target benchmark. Over a period
of time in excess of one day, the cumulative percentage increase or
decrease in the NAV of the Shares of a Fund may diverge significantly
from a multiple or inverse multiple of the cumulative percentage
decrease or increase in the relevant benchmark due to a compounding
effect.
    In addition, the Information Bulletin will advise ETP Holders,
prior to the commencement of trading, of the prospectus delivery
requirements applicable to a Fund. The Information Bulletin will also
discuss any exemptive, no-action, and interpretive relief granted by
the Commission from any rules under the Act. In addition, the
Information Bulletin will reference that a Fund is subject to various
fees and expenses described in the Registration Statement. The
Information Bulletin will also reference that the CFTC has regulatory
jurisdiction over the trading of Bitcoin Futures Contracts traded on
U.S. markets.
    The Information Bulletin will also disclose the trading hours of
the Shares that the NAV for the Shares will be calculated after 11:00
a.m. E.T. each trading day. The Information Bulletin will disclose that
information about the Shares will be publicly available on the Funds'
website.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \20\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \20\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices and to protect
investors and the public interest in that the Shares will be listed and
traded on the Exchange pursuant to the initial and continued listing
criteria in NYSE Arca Rule 8.200-E.
    The Exchange has in place surveillance procedures that are adequate
to properly monitor trading in the Shares in all trading sessions and
to deter and detect violations of Exchange rules and applicable federal
securities laws. The Exchange or FINRA, on behalf of the Exchange, or
both, will communicate as needed regarding trading in the Shares, and
certain Bitcoin Futures Contracts with other markets and other entities
that are members of the ISG, and the Exchange or FINRA, on behalf of
the Exchange, or both, may obtain trading information regarding trading
in the Shares and certain Bitcoin Futures Contracts from such markets
and other entities. In addition, the Exchange may obtain information
regarding trading in the Shares and certain Bitcoin Futures Contracts
from markets and other entities that are members of ISG or with which
the Exchange has in place a CSSA. The Exchange is also able to obtain
information regarding trading in the Shares, the commodity underlying
futures or options on futures through ETP Holders, in connection with
such ETP Holders' proprietary or customer trades which they effect
through ETP Holders on any relevant market.
    The Exchange can obtain market surveillance information, including
customer identity information, with respect to transactions (including
transactions in cash-settled Options) occurring on U.S. futures
exchanges, which are members of the ISG. The intraday, closing prices,
and settlement prices of the Bitcoin Futures Contracts will be readily
available from the applicable futures exchange websites, automated
quotation systems, published or other public sources, or major market
data vendors website or on-line information services.
    Complete real-time data for the Bitcoin Futures Contracts and
Options on Bitcoin Futures will be available by subscription from on-
line information services. CME and CBOE will provide delayed futures
information on current and past trading sessions and market news free
of charge on their websites. The specific contract specifications for
Bitcoin Futures Contracts would also be available on such websites, as
well as other financial informational sources. Information regarding
options will be available from the applicable exchanges or major market
data vendors. Quotation and last-sale information regarding the Shares
will be disseminated through the facilities of the CTA. The Funds'
website will also include a form of the prospectus for the Funds that
may be downloaded. The website will include the Shares' ticker and
CUSIP information, along with additional quantitative information
updated on a daily basis for each Fund. The Funds' website will include
(1) the prior business day's reported NAV and closing price, and a
calculation of the premium and discount of the closing price or mid-
point of the Bid/Ask Price against the NAV; and (2) data in chart
format displaying the frequency distribution of discounts and premiums
of the daily closing price or Bid/Ask Price against the NAV, within
appropriate ranges, for at least each of the four previous calendar
quarters. The website disclosure of portfolio holdings will be made
daily and will include, as applicable, (i) the name, quantity, value,
expiration and strike price of Bitcoin Futures Contracts and Bitcoin
Financial Instruments, (ii) the value of Bitcoin Financial Instruments,
and (iii) the aggregate net value of the Money Market Investments held
in each Fund's portfolio, if applicable. The Funds' website will be
publicly available prior to the public offering of Shares and
accessible at no charge.

    In addition, the CFTC has noted that the U.S. futures exchanges
that will trade bitcoin futures have agreed to significant enhancements
to protect customers and maintain orderly markets, and announced its
expectation that futures exchanges that list and trade bitcoin futures
contracts will, through information sharing agreements, monitor the
trading activity on the relevant cash platforms for potential impacts
on the price discovery process for bitcoin futures contracts, including
potential market manipulation and market dislocations due to flash
rallies and crashes and trading outages.
    Moreover, prior to the commencement of trading, the Exchange will
inform its Equity Trading Permit Holders in an Information Bulletin of
the special characteristics and risks associated with trading the
Shares and of the suitability requirements of NYSE Arca Rule 9.2-E(a).
The Information Bulletin will advise ETP Holders, prior to the
commencement of trading, of the prospectus delivery requirements
applicable to a Fund. The Information Bulletin will also discuss any
exemptive, no-action, and interpretive relief granted by the Commission
from any rules under the Act. In addition, the Information Bulletin
will reference that a Fund is subject to various fees and expenses
described in the Registration Statement. The Information Bulletin will
also reference that the CFTC has regulatory jurisdiction over the
trading of Bitcoin Futures Contracts traded on U.S. markets. The
Information Bulletin will also disclose the trading hours of the Shares
and that the NAV for the Shares will be calculated after 11:00 a.m.
E.T. each trading day. The Information Bulletin will disclose that
information about the Shares will be publicly available on the Funds'
website.
    Trading in Shares of a Fund will be halted if the circuit breaker
parameters in NYSE Arca Rule 7.12-E have been reached or because of
market conditions or for reasons that, in the view of the Exchange,
make trading in the Shares inadvisable.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of a
new type of Trust Issued Receipt based on the price of Bitcoin Futures
Contracts that will enhance competition among market participants, to
the benefit of investors and the marketplace. As noted above, the
Exchange has in place surveillance procedures that are adequate to
properly monitor trading in the Shares in all trading sessions and to
deter and detect violations of Exchange rules and applicable federal
securities laws.

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 that is not necessary or appropriate
in furtherance of the purpose of the Act. The Exchange notes that the
proposed rule change will facilitate the listing and trading of a new
type of Trust Issued Receipt based on the price of Bitcoin Futures
Contracts and that will enhance competition among market participants,
to the benefit of investors and the marketplace.

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-NYSEArca-2018-02 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-NYSEArca-2018-02. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing will also be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NYSEArca-2018-02 and should be submitted
on or before February 14, 2018.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\21\
---------------------------------------------------------------------------

    \21\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-01209 Filed 1-23-18; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: August 10, 2010 (Volume 75, Number 153)]
[Notices]
[Page 48411]
[DOCID:fr10au10-102]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Research, Engineering and Development Advisory Committee; Notice
of Meeting

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of Meeting.

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

    Pursuant to section 10(A)(2) of the Federal Advisory Committee Act
(Pub. L. 92-463; 5 U.S.C. App. 2), notice is hereby given of a meeting
of the FAA Research, Engineering and Development (R, E&D) Advisory
Committee.
    Name: Research, Engineering & Development Advisory Committee.
    Time and Date: September 22, 2010--9:30 a.m. to 4 p.m.
    Place: BAE Systems Conference Center, 80 M Street, SE., Washington,
DC 20003.
    Purpose: The meeting agenda will include receiving from the
Committee guidance for FAA's research and development investments in
the areas of air traffic services, airports, aircraft safety, human
factors and environment and energy. Attendance is open to the
interested public but seating is limited. Persons wishing to attend the
meeting or obtain information should contact Gloria Dunderman at (202)
267-8937 or<EMAIL_ADDRESS>Attendees will have to present
picture ID at the security desk.
    Members of the public may present a written statement to the
Committee at any time.

    Issued in Washington, DC, on July 30, 2010.
Barry Scott,
Director, Research & Technology Development.
[FR Doc. 2010-19478 Filed 8-9-10; 8:45 am]
BILLING CODE 4910-13-M


[Federal Register: November 28, 2006 (Volume 71, Number 228)]
[Notices]
[Page 68853-68855]
[DOCID:fr28no06-95]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54780; File No. SR-CBOE-2006-87]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change to Extend a Pilot Program Relating to CBOE's Retail
Automatic Execution System

November 17, 2006.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 3, 2006, the Chicago Board Options Exchange,
Incorporated (``CBOE'' or ``Exchange'') filed with the Securities and
Exchange Commission (the ``Commission'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the CBOE. The Exchange filed the proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
\3\ and Rule 19b-4(f)(6) thereunder,\4\ which renders it effective upon
filing with the Commission.\5\ The Commission is publishing this notice
to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
    \5\ The Exchange has asked the Commission to waive the 30-day
operative delay required by Rule 19b-4(f)(6)(iii), 17 CFR 240.19b-
4(f)(6)(iii). See discussion infra Section III.
---------------------------------------------------------------------------

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

    CBOE proposes to extend a pilot program relating to the operation
of CBOE's Retail Automatic Execution

System (``RAES''). The text of the proposed rule change is available on
the CBOE's Internet Web site (http://www.cboe.com), at the CBOE's

principal office, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the CBOE 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. CBOE 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 the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to extend a pilot program until
November 30, 2007 to allow broker-dealer orders that are eligible for
execution on RAES pursuant to CBOE Rule 6.8, Interpretation and Policy
.01 to automatically execute against customer limit orders on CBOE's
book in classes designated by the appropriate Procedure Committee. The
pilot was originally approved on May 13, 2004, with an expiration date
of November 30, 2004.\6\ The pilot was extended for one year to
November 30, 2005 pursuant to SR-CBOE-2004-78 \7\ and again extended an
additional year to November 30, 2006 pursuant to SR-CBOE-2005-96.\8\
---------------------------------------------------------------------------

    \6\ Securities Exchange Act Release No. 49699 (May 13, 2004), 69
FR 28958 (May 19, 2004) (approving SR-CBOE-2003-42).
    \7\ Securities Exchange Act Release No. 50779 (December 1,
2004), 69 FR 71087 (December 8, 2004).
    \8\ Securities Exchange Act Release No. 52855 (November 30,
2005), 70 FR 73317 (December 9, 2005).
---------------------------------------------------------------------------

    The Exchange's RAES system was created to allow for the automatic
execution of retail customer options orders against CBOE market makers
at their disseminated prices. In 1999, the Exchange expanded the RAES
system to allow incoming RAES orders to execute against customer limit
orders on the CBOE book when such booked orders constitute CBOE's best
bid/offer.\9\ The Exchange has allowed broker-dealer orders to be
executed on RAES in classes designated by the appropriate Procedure
Committee.\10\ The pilot program allows these broker-dealer orders to
automatically execute against the book.
---------------------------------------------------------------------------

    \9\ Securities Exchange Act Release No. 41995 (October 8, 1999),
64 FR 56547 (October 20, 1999) (approving SR-CBOE-1999-29).
    \10\ See SR-CBOE-2002-22, 35, and 56.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
Section 6(b) of the Act, in general and furthers the objectives of
Section 6(b)(5) of the Act in particular in that it should promote just
and equitable principles of trade, serve to remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and protect investors and the public interest.

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

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

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    Because the foregoing proposed rule change does not (1)
significantly affect the protection of investors or the public
interest; (2) impose any significant burden on competition; and (3)
become operative for thirty days from the date on which it was filed,
or such shorter time as the Commission may designate if consistent with
the protection of investors and the public interest, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-
4(f)(6) \12\ thereunder.\13\
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ Pursuant to Rule 19b-4(f)(6)(iii), the Exchange has given
the Commission written notice of its intent to file the proposed
rule change, along with a brief description and text of the proposed
rule change, at least five business days prior to the date on which
the Exchange filed the proposed rule change. See 17 CFR 240.19b-
4(f)(6)(iii).
---------------------------------------------------------------------------

    A proposed rule change filed under Commission Rule 19b-4(f)(6) \14\
normally does not become operative prior to thirty days after the date
of filing. The CBOE requests that the Commission waive the 30-day
operative delay, as specified in Rule 19b-4(f)(6)(iii), and designate
the proposed rule change to become operative immediately to allow the
Exchange to continue to operate the pilot program which affords
automatic execution to a greater number of market participants on an
uninterrupted basis. The Commission hereby grants the request. The
Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because such waiver will allow the CBOE to continue to operate under
the pilot program without interruption. For these reasons, the
Commission designates the proposed rule change as effective and
operative upon filing.\15\
---------------------------------------------------------------------------

    \14\ 17 CFR 240.19b-4(f)(6).
    \15\ For the purposes only of waiving the operative date of this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to<EMAIL_ADDRESS>Please include

File No. SR-CBOE-2006-87 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
    All submissions should refer to File Number SR-CBOE-2006-87. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments,

all written statements with respect to the proposed rule

change that are filed with the Commission, and all written
communications relating to the proposed rule change between the
Commission and any person, other than those that may be withheld from
the public in accordance with the provisions of 5 U.S.C. 552, will be
available for inspection and copying in the Commission's Public
Reference Room. Copies of such filing also will be available for
inspection and copying at the principal office of the CBOE. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-CBOE-2006-87 and should be
submitted on or before December 19, 2006.
---------------------------------------------------------------------------

    \16\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
Nancy M. Morris,
Secretary.
[FR Doc. E6-20054 Filed 11-27-06; 8:45 am]

BILLING CODE 8011-01-P


place as a binding regulation, the costs and benefits of this option have already been realized and
will not be counted again as a cost or benefit of the final rule. If the requirements for prior notice
change for the final rule, then the difference in costs and benefits from the IFR to the final option
will make up the costs and benefits of the prior notice final rule.
In the economic analysis of the IFR we calculated the costs of: learning prior notice,
computer acquisition, information coordination, submitting prior notice, creating the PNSI, not
being able to use CBP’s BRASS system, and loss of value to fresh produce that waits longer at
8
the port of arrival than before prior notice was required.
We do not repeat or update the cost calculations for learning prior notice, buying
computers, information coordination, not being able to use CBP’s BRASS system, or FDA
information technology here.  We do not have new information on the number of importers
9
(firms) that would be the basis for which to update this information; we estimated annual costs
for new firms entering the industry for all these cost calculations in the IFR.  To see these
8
Border Release Advance Screening and Selectivity (BRASS) is a CBP program that allows expedited arrival
processing for high-volume, repetitive shipments that have been judged by CBP to be low risk.
9
Firm data were obtained from the U.S. Census.  These data are only updated every few years and do not permit us
to recalculate the number of importers at this time.  Data received by the Prior Notice Center also will not allow us
to easily recalculate (because of the data format) the number of unique people or firms who submitted prior notice.

349
specific cost calculations, refer to the preamble discussion in the prior notice IFR (68 FR 58974
at 59025).
We do, however, have new data on the number of prior notices submitted based on 2007
data collected by FDA’s PNC.  Therefore, we do update, for the baseline and all other options,
the costs of submitting prior notices and the lost value of fresh produce.
Also, due to an oversight in the calculation of the costs for the IFR, FDA did not
calculate the costs to importers of providing the imported product’s manufacturer registration
number and full facility address on prior notice.  We correct that oversight here.
Updated Annual Costs to Submit Prior Notice
FDA’s PNC received 9,804,050 prior notices for FY 2007, which is about 3 million more
prior notices than we estimated in the analysis of the IFR. The difference in number of
submissions is in part due to an increase in the number of prior notices submitted for each
imported food entry.  In the IFR analysis, we estimated that there were about 2.6 lines (prior
notices) submitted for each food shipment.
10
New OASIS shipment data show that for 2007, the
average number of lines per entry for food, food related, infant food, and food additive industry
codes is 3.6 lines per entry.
We use these new data on entry lines to estimate that FDA receives 9,804,050 prior
notices per year, which translates into approximately 2.7 million imported food entries (based on
10
As explained in more detail in the economic analysis of the interim final rule, OASIS data indicate there are
typically more than two different articles of food per import entry; e.g., 100 cases of canned tuna and 50 cases of
canned peaches in the same shipment. A prior notice must be filed for each of the lines in an entry.

350
3.6 lines per entry
11
) annually.  Table 3 of this document shows that the annual costs to complete
a prior notice will be $202.5 million instead of the $187.5 million estimated in the IFR.
TABLE 3.--COST TO COMPLETE A PRIOR NOTICE BY IMPORT ENTRY (MUST BE ELECTRONIC)
Broker cost per entry to submit prior notice
$75
Entry total based on 9.8 million lines
2
,700,000
Total annual costs of all prior notices, including updates to the information
$202,500,000
Updated Costs to Submit Prior Notice by Mode of Transport
2-hour Minimum Prior Notice Time for Food Arriving by Land by Road
Prior notices for perishable articles of food from Canada and Mexico that arrive in the
United States by land by road must be submitted at least 2 hours before the food arrives in the
United States.  In the analysis of the IFR, we assumed that this minimum submission time should
eliminate the probability of having to resubmit prior notice (due to proximity to the U.S. port of
entry) for all but 5 percent of those perishable products imported from Canada and Mexico.
Data from the FDA PNC for 2007 indicate that 85 percent of the articles of food arriving
from Canada enter the United States by land by road; and approximately 94 percent of the
articles of food arriving from Mexico enter the United States. by land by road.
12
Using these
updated estimates, we calculate the proportion of the total retail value of highly perishable
produce and seafood from Canada and Mexico that arrive in the United States by land by road.
We then calculate the lost product value for the 5 percent of highly perishable produce and
seafood from Canada and Mexico for which importers may have to resubmit the prior notice
when the minimum submission time is 2 hours.  Table 4 of this document shows the revised
11
This is likely a slight overestimate of prior notices per entry because food-related items (such as eating utensils)
are not subject to prior notice.
12
The mode of transportation field in prior notice is user defined; thus, the person submitting the prior notice is
responsible for informing FDA by what mode of transport the food will enter the United States.  As mode of
transport is user defined, there is a possibility of error.

351
estimated loss in value caused by the cancelled and resubmitted prior notice information for the 5
percent of imported Mexican and Canadian perishable seafood and produce affected.
We do not include the lost value for perishable seafood and produce imported from
Central America because perishable products from Central America are most likely to arrive by
air into the United States.  We also do not include the cost of additional truck time with this
option since the minimum prior notice time for articles of food arriving by vehicle is only 2
hours.
TABLE 4.--LOSS IN VALUE CAUSED BY RESUBMITTED PRIOR NOTICE UNDER OPTION 1 FOR ARTICLES OF
FOOD ARRIVING BY LAND BY ROAD (2-HOUR MINIMUM NOTICE REQUIREMENT)
Perishable Produce
Dollars
2
001
Imported Mexican produce total retail value
$3,458,525,000
94
% of total retail value for Mexican produce
$3,251,014,000
1.
2% Reduction in value for 5% of Mexican produce
$1,951,000
2
001
Imported Canadian produce total retail value
$401,826,000
85
% of total retail value for Canadian produce
$341,552,000
1.
2% Reduction in value for 5% of Canadian produce
$205,000
Total lost value for produce
$2,156,000
Perishable Seafood
Dollars
2
001
Imported Mexican seafood total retail value
$112,277,000
94
% of total retail value for Mexican seafood
$105,540,000
4.
2% Reduction in value for 5% of Mexican seafood
$222,000
20
0
1
Imported Canadian seafood total retail value
$1,863,218,000
85
% of total retail value for Canadian seafood
$1,583,735,000
4.
2% Reduction in value for 5% of Canadian seafood
$3,326,000
Total lost value for seafood
$3,548,000
4-hour minimum prior notice time for food arriving by land by rail and by air
The 4-hour minimum submission time for prior notice applies to articles of food imported
or offered for import by land by rail and by air.  A 4-hour minimum prior notice time for
railroads and airplanes could constrain products arriving from the countries bordering the United

352
States.  Data from the PNC for 2007 show that about 4 percent of the articles of food arriving
from Canada were imported into the U.S. by land by rail and only about 2 percent of the articles
of food arriving from Mexico were imported into the United States by land by rail. Similarly,
about 8 percent of the articles of food arriving from Canada were imported into the United States
by air, while only about 3 percent of the articles of food arriving from Mexico were imported
into the United States by air.
To estimate potential lost value for produce imported from Canada and Mexico by rail
and air, we adjust the total retail value of highly perishable produce and seafood from Canada
and Mexico to account for the 12 percent from Canada and the 5 percent from Mexico that are
imported by land by rail or by air.   Table 5 of this document shows the articles of food arriving
by rail and air from Canada and Mexico that may have to resubmit prior notice when the
minimum prior notice timeframe is 4 hours before arrival in the United States.
For Central American and Caribbean countries, most, if not all, of their perishable
products are imported to the United States by air.  Table 5 of this document shows the loss of
value for the estimated 20 percent of air shipments from Central America for which prior notice
needs to be resubmitted under Option 1.
13
13
The estimated 20 percent cancellation and resubmission rate for prior notices when the minimum submission time
is 4 hours is used in the IFR analysis.  (See 68 FR 58974 at 59045.)

353
TABLE 5.--LOSS IN VALUE CAUSED BY RESUBMITTED PRIOR NOTICE UNDER OPTION 1 FOR SHIPMENTS ARRIVING
BY AIR AND BY LAND BY RAIL (4-HOUR MINIMUM NOTICE REQUIREMENT)
Perishable Produce
Dollars
2
001
Imported Mexican produce total retail value
$3,458,525,000
5
% of total retail value for Mexican produce
$172,926,000
2
.
4
% reduction in value for 20% of Mexican produce
$830,000
2
001
Imported Canadian produce total retail value
$401,826,000
12
% of total retail value for Canadian produce
$48,219,000
2
.
4
% reduction in value for 20% of Canadian produce
$231,000
2
.
4
% reduction in value for 20% of Central American and Caribbean produce
$1,044,000
Total lost value for produce
$2,105,000
Perishable Seafood
Dollars
2
001
Imported Mexican seafood total retail value
$112,277,000
5
% of total retail value for Mexican seafood
$5,614,000
8
.
3
% reduction in value for 20% of Mexican seafood
$93,000
20
0
1
Imported Canadian seafood total retail value
$1,863,218,000
12
% of total retail value for Canadian seafood
$204,954,000
8.
3% Reduction in value for 20% of Canadian seafood
$3,712,000
2
001
Imported Central American and Caribbean seafood total retail value
$251,796,000
8.
3% Reduction in value for 20% of Central American and Caribbean seafood
$4,180,000
Total lost value for seafood
$7,985,000
Updated IFR Costs to Include the Costs of Manufacturer Name, Registration Number and Partial
Address on Prior Notice
Section 1.281(a)(6), (b)(5), and (c)(6) of the IFR requires that prior notice for an article of
food that is no longer in its natural state include the name and address of the manufacturer and
the registration number assigned to the facility that is associated with the article of food.
14
This
IFR requirement has not been fully enforced by FDA, as described in CPG Sec. 110.310;
14
The interim final rule further states that a registration number is not required for a facility associated with an
article of food if the article is imported or offered for import for transshipment, storage, and export, or further
manipulation and export.  The interim final rule also provides that if the article of food is sent by an individual as a
personal gift (i.e., for non-business reasons) to an individual in the United States, he or she may provide the name
and address of the firm that appears on the label under § 101.5 instead of the name, address, and registration number
of the manufacturer.  If a registration number is provided, city and country may be provided instead of the full
address.

354
however, it is a requirement of the rule and must therefore be considered as a cost of the IFR.
We correct an oversight in the calculation of the costs of the IFR by including the costs of
submitting the food manufacturer registration number and facility address on prior notice here.
How Some Importers Will Be Affected
The November 2004 revision of the IFR CPG stated that if the manufacturer’s
registration number was not given on the prior notice, the submitter should select the appropriate
reason identifying why the manufacturer's registration number and/or name and address was not
provided.  The reason codes provided by PNSI and ABI/ACS were:
•
A- facility is out of business
•
B- facility is a private residence
•
C- facility is a restaurant
•
D- facility is a retail food establishment
•
E- facility is a non-processing fishing vessel
•
F- Facility is non-bottled water collection and distribution establishment
•
G- Individual gift-label name/address
•
H- Grower-satisfies farm exemption
•
I- Samples-quality assurance, research or analysis purposes only
•
J- U.S. manufacturing facility that is not required to register
•
K- Unable to determine the registration number of the manufacturer
•
L- Unable to determine identity of manufacturer-providing identity of
manufacturer’s headquarters
•
M- Unable to determine identity of manufacturer or headquarters-providing
invoicing firm’s identity

355
•
O- Gift pack for non-business purposes-providing single prior notice and
identity of packer
Prior notices submitted without manufacturer registration numbers but using reason codes
A through F, H, and J would be compliant with IFR requirements because the manufacturer
would be exempt from being registered according to the Registration of Food Facilities rule (21
CFR part 1, subpart H).  Prior notices submitted without manufacturer registration numbers but
using reason code G would be compliant with IFR requirements because the prior notice IFR
allows that if an article of food is sent by an individual as a personal gift (i.e., for non-business
reasons) to an individual in the United States, the submitter may provide the name and address of
the firm that appears on the label instead of the name, address, and registration number of the
manufacturer. A prior notice submitted without the manufacturer name, address, and/or
registration number but using reason code I, K through M, or O would not be compliant with IFR
requirements.  However, FDA's enforcement policy was that it should typically consider not
taking any regulatory action for prior notice violations in these cases.
We can use information from the PNC on the CPG code reasons given for fiscal year
2007 to determine how many submitters had trouble providing the manufacturer registration
number and facility address as is required by the IFR (submitters who used reason codes I, K
through M, and O).
The PNC was able to determine that about 92.5% percent of prior notices contained the
manufacturer's name, address, and registration number as required by the IFR.  Table 6 of this
document shows that about 2.9 percent of prior notice submissions (2.91 percent) for 2007 used
reason codes I, K through M, and O.

356
TABLE 6.--NO MANUFACTURER REGISTRATION NUMBER ON PRIOR NOTICE, REASON CODE LINE COUNT FOR
FISCAL YEAR 2007
Reason
Code
Description
PN Lines
Count
% of Total
Lines
Total prior notice submissions for fiscal year 2007
9,804,050
A
Facility is out of business
4
3
,479
0
.
4
4
%
B
Facility is a private residence
3
0
,801
0
.
3
1
%
C
Facility is a restaurant
5
,146
0
.
0
5
%
D
Facility is a retail food establishment
4
7
,705
0
.
4
9
%
E
Facility is a non-processing fishing vessel
2
,488
0
.
0
3
%
F
Facility is a non-processing drinking water collection and distribution
establishment
1,417
0.
01
%
G
Individual gift label name/address in lieu of registration number
36
,808
0.
38
%
H
Grower satisfies farm exemption
26
7,369
2.
73
%
I
Samples--quality assurance, research or analysis purposes only
5
5
,374
0
.
5
6
%
J
U.S. manufacturing facility that is not required to register


[Federal Register: February 27, 2008 (Volume 73, Number 39)]
[Notices]
[Page 10455]
[DOCID:fr27fe08-57]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

Pediatric Oncology Subcommittee of the Oncologic Drugs Advisory
Committee; Notice of Meeting

AGENCY:  Food and Drug Administration, HHS.

ACTION:  Notice.

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

    This notice announces a forthcoming meeting of a public advisory
committee of the Food and Drug Administration (FDA). The meeting will
be open to the public.
    Name of Committee: Pediatric Oncology Subcommittee of the Oncologic
Drugs Advisory Committee.
    General Function of the Committee: To provide advice and
recommendations to the agency on FDA's regulatory issues.
    Date and Time: The meeting will be held on April 16, 2008, from
8:30 a.m. to 3:30 p.m.
    Location: Food and Drug Administration, Center for Drug Evaluation
and Research Advisory Committee Conference Room, rm. 1066, 5630 Fishers
Lane, Rockville, MD.
    Contact Person: Nicole Vesely, Center for Drug Evaluation and
Research (HFD-21), Food and Drug Administration, 5600 Fishers Lane (for
express delivery, 5630 Fishers Lane, rm. 1093), Rockville, MD 20857,
301-827-6793, FAX:<PHONE_NUMBER>, e-mail<EMAIL_ADDRESS>or
FDA Advisory Committee Information Line, 1-800-741-8138<PHONE_NUMBER>
in the Washington, DC area), code<PHONE_NUMBER>. Please call the
Information Line for up-to-date information on this meeting. A notice
in the Federal Register about last minute modifications that impact a
previously announced advisory committee meeting cannot always be
published quickly enough o provide timely notice. Therefore, you should
always check the agency's Web site and call the appropriate advisory
committee hot line/phone line to learn about possible modifications
before coming to the meeting.
    Agenda: The subcommittee will consider and discuss opportunities
for enhancing global pediatric oncology drug development and expanding
international regulatory interactions given the January 2007
legislation introduced in the European Union that governs the
development and authorization of medicines for use in children aged 0
to 17 years.
    FDA intends to make background material available to the public no
later than 2 business days before the meeting. If FDA is unable to post
the background material on its Web site prior to the meeting, the
background material will be made publicly available at the location of
the advisory committee meeting, and the background material will be
posted on FDA's Web site after the meeting. Background material is
available at http://www.fda.gov/ohrms/dockets/ac/acmenu.htm, click on
the year 2008 and scroll down to the appropriate advisory committee
link.
    Procedure: Interested persons may present data, information, or
views, orally or in writing, on issues pending before the subcommittee.
Written submissions may be made to the contact person on or before
April 2, 2008. Oral presentations from the public will be scheduled
between approximately 1 p.m. and 2 p.m. Those desiring to make formal
oral presentations should notify the contact person and submit a brief
statement of the general nature of the evidence or arguments they wish
to present, the names and addresses of proposed participants, and an
indication of the approximate time requested to make their presentation
on or before March 25, 2008. Time allotted for each presentation may be
limited. If the number of registrants requesting to speak is greater
than can be reasonably accommodated during the scheduled open public
hearing session, FDA may conduct a lottery to determine the speakers
for the scheduled open public hearing session. The contact person will
notify interested persons regarding their request to speak by March 26,
2008.
    Persons attending FDA's advisory committee meetings are advised
that the agency is not responsible for providing access to electrical
outlets.
    FDA welcomes the attendance of the public at its advisory committee
meetings and will make every effort to accommodate persons with
physical disabilities or special needs. If you require special
accommodations due to a disability, please contact Nicole Vesely at
least 7 days in advance of the meeting.
    FDA is committed to the orderly conduct of its advisory committee
meetings. Please visit our Web site at http://www.fda.gov/oc/advisory/
default.htm for procedures on public conduct during advisory committee
meetings.
    Notice of this meeting is given under the Federal Advisory
Committee Act (5 U.S.C. app. 2).

    Dated: February 19, 2008.
Randall W. Lutter,
Deputy Commissioner for Policy.
[FR Doc. E8-3676 Filed 2-26-08; 8:45 am]

BILLING CODE 4160-01-S


[Federal Register Volume 84, Number 50 (Thursday, March 14, 2019)]
[Notices]
[Pages 9317-9319]
[FR Doc No: 2019-04678]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. IC19-16-000]

Commission Information Collection Activities; Comment Request;
Extension

AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of information collection and request for comments.

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

SUMMARY: In compliance with the requirements of the Paperwork Reduction
Act of 1995, the Federal Energy Regulatory Commission

(Commission or FERC) is soliciting public comment on the currently
approved information collection, FERC-556 (Certification of Qualifying
Facility (QF) Status for a Small Power Production or Cogeneration
Facility).

DATES: Comments on the collection of information are due May 13, 2019.

ADDRESSES: You may submit comments (identified by Docket No. IC19-16-
000) by either of the following methods:
     eFiling at Commission's Website: http://www.ferc.gov/docs-filing/efiling.asp.
     Mail/Hand Delivery/Courier: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE,
Washington, DC 20426.
    Instructions: All submissions must be formatted and filed in
accordance with submission guidelines at: http://www.ferc.gov/help/submission-guide.asp. For user assistance, contact FERC Online Support
by email at<EMAIL_ADDRESS>or by phone at:<PHONE_NUMBER>
(toll-free), or<PHONE_NUMBER> for TTY.
    Docket: Users interested in receiving automatic notification of
activity in this docket or in viewing/downloading comments and
issuances in this docket may do so at http://www.ferc.gov/docs-filing/docs-filing.asp.

FOR FURTHER INFORMATION CONTACT: Ellen Brown may be reached by email at
<EMAIL_ADDRESS>telephone at<PHONE_NUMBER>, and fax at (202)
273-0873.

SUPPLEMENTARY INFORMATION:
    Title: FERC-556, Certification of Qualifying Facility (QF) Status
for a Small Power Production or Cogeneration Facility.
    OMB Control No.: 1902-0075.
    Type of Request: Three-year extension of the FERC-556 information
collection requirements with no changes to the current reporting
requirements.
    Abstract: Form No. 556 is required to implement sections 201 and
210 of the Public Utility Regulatory Policies Act of 1978 \1\ (PURPA).
FERC is authorized, under those sections, to encourage cogeneration and
small power production and to prescribe such rules as necessary in
order to carry out the statutory directives.
---------------------------------------------------------------------------

    \1\ 16 U.S.C. 796, 824a-3.
---------------------------------------------------------------------------

    A primary statutory objective is efficient use of energy resources
and facilities by electric utilities. One means of achieving this goal
is to encourage production of electric power by cogeneration facilities
which make use of reject heat associated with commercial or industrial
processes, and by small power production facilities which use other
wastes and renewable resources. PURPA encourages the development of
small power production facilities and cogeneration facilities that meet
certain technical and corporate criteria through establishment of
various regulatory benefits. Facilities that meet these criteria are
called Qualifying Facilities (QFs).
    FERC's regulations in 18 CFR part 292, as relevant here, specify:
(a) The certification procedures which must be followed by owners or
operators of small power production and cogeneration facilities; (b)
the criteria which must be met; (c) the information which must be
submitted to FERC in order to obtain qualifying status; and (d) the
PURPA benefits which are available to QFs to encourage small power
production and cogeneration.
    18 CFR part 292 also exempts QFs from certain corporate,
accounting, reporting, and rate regulation requirements of the Federal
Power Act,\2\ certain state laws, and the Public Utility Holding
Company Act of 2005.\3\
---------------------------------------------------------------------------

    \2\ 16 U.S.C. 791, et seq.
    \3\ 42 U.S.C. 16, 451-63.
---------------------------------------------------------------------------

    Type of Respondents: Facilities that are self-certifying their
status as a cogenerator or small power producer or that are submitting
an application for FERC certification of their status as a cogenerator
or small power producer.
    Estimate of Annual Burden: \4\ The Commission estimates the burden
and cost for this information collection as follows:
---------------------------------------------------------------------------

    \4\ ``Burden'' is the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. For further
explanation of what is included in the information collection
burden, refer to Title 5 Code of Federal Regulations 1320.3.

                       FERC-556--Certification of Qualifying Facility Status for a Small Power Production or Cogeneration Facility
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Total annual
                                                      Number of     Annual number   Total number      Average burden     burden hours &      Cost per
         Facility type             Filing type       respondents    of responses    of responses     hours & cost per     total annual    respondent ($)
                                                                   per respondent                      response \5\      cost (rounded)      (rounded)
                                                              (1)             (2)     (1) * (2) =  (4)                  (3) * (4) = (5)        (5) / (1)
                                                                                (3)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cogeneration Facility > 1 MW    Self-                          63            1.25           78.75  1.5 hrs; $118.5....  118.125 hrs;                $148
 \6\.                            certification.                                                                          $9,332.
Cogeneration Facility > 1 MW..  Application for                 1            1.25            1.25  50 hrs; $3,950.....  62.5 hrs; $4,938           4,938
                                 FERC
                                 certification.
Small Power Production          Self-                       2,698            1.25         3,372.5  1.5 hrs; $118.5....  5,058.75 hrs;                148
 Facility > 1 MW.                certification.                                                                          $399,641.
Small Power Production          Application for                 0            1.25               0  50 hrs; $3,950.....  0 hrs; $0.......               0
 Facility > 1 MW.                FERC
                                 certification.
Cogeneration and Small Power    Self-                         692            1.25             865  1.5 hrs; $118.5....  1,297.5 hrs;                 148
 Production Facility <= 1 MW     certification.                                                                          $102,503.
 (Self-Certification) \7\.
    Total.....................  .................           3,454  ..............         4,317.5  ...................  6,536.875 hrs;    ..............
                                                                                $516,413.13.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Comments: Comments are invited on: (1) Whether the collection of
information is necessary for the proper performance of the functions of
the Commission, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden and
cost of the collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility and clarity of the information collection; and (4) ways to
minimize the burden of the collection of information on those who are
to respond, including the use of automated collection techniques or
other forms of information technology.
---------------------------------------------------------------------------

    \5\ The Commission staff believes that industry is similarly
situated in terms of wages and benefits. Therefore, cost estimates
are based on FERC's 2018 average annual wage (and benefits) for a
full-time employee of $164,820 (or $79.00/hour).
    \6\ MW = megawatt.
    \7\ Not required to file.

    Dated: March 7, 2019.
Kimberly D. Bose,
Secretary.
[FR Doc. 2019-04678 Filed 3-13-19; 8:45 am]
 BILLING CODE 6717-01-P