[Federal Register Volume 82, Number 107 (Tuesday, June 6, 2017)]
[Notices]
[Pages 26196-26201]
[FR Doc No: 2017-11603]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80818; File No. SR-ICC-2017-005]

Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of
Filing of Proposed Rule Change, Security-Based Swap Submission, or
Advance Notice Relating to ICC's Liquidity Risk Management Framework
and ICC's Stress Testing Framework

May 31, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934,\1\ (``Act'') and Rule 19b-4 thereunder,\2\ notice is hereby given
that on May 16, 2017, ICE Clear Credit LLC (``ICC'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change, as described in Items I, II and III below, which Items have
been primarily prepared by ICC. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------

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

I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

    The principal purpose of the proposed rule change is to revise the
ICC Liquidity Risk Management Framework and the ICC Stress Testing
Framework. These revisions do not require any changes to the ICC
Clearing Rules (``Rules'').

II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

    In its filing with the Commission, ICC 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. ICC has prepared summaries, set forth in sections A, B,
and C below, of the most significant aspects of these statements.

A. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

1. Purpose
    ICC proposes revisions to its Liquidity Risk Management Framework
and to its Stress Testing Framework. ICC believes such revisions will
facilitate the prompt and accurate clearance and settlement of
securities transactions and derivative agreements, contracts, and
transactions for which it is responsible. The proposed revisions are
described in detail as follows.
Liquidity Risk Management Framework
    ICC proposes to revise its Liquidity Risk Management Framework in
order to make revisions to its liquidity monitoring program in order to
enhance compliance with U.S. Commodity Futures Trading Commission
(``CFTC'') regulations, including 17 CFR 39.11, 17 CFR 39.33and 17 CFR
39.36.
    ICC proposes to reorganize the format of the Liquidity Risk
Management Framework to consist of three elements: Liquidity Risk
Management Model; Measurement and Monitoring; and Governance. The
``Regulatory Requirements'' section, previously included as an element
of the framework, will be deleted; however, the regulatory requirements
applicable to liquidity risk management are still referenced in the
framework. The changes to each element of the Liquidity Risk Management
Framework are described below.
Liquidity Risk Management Model
    ICC proposes to enhance the description of the components which
comprise its liquidity risk management model. As revised, the liquidity
risk management model now includes, but is not limited to, the
following components: Currency-specific risk requirements; acceptable
collateral; liquidity requirements; collateral valuation methodology;
investment strategy; Clearing Participant (``CP'') deposits as a
liquidity pool; liquidity facilities (including committed repo
facilities and committed foreign exchange (``FX'') facilities); and
liquidity waterfall. Each of these components are described thoroughly
within the Liquidity Risk Management Framework, and changes to each
component are described below.
Currency-Specific Risk Requirements
    ICC proposes to add language to the `currency-specific risk
requirements' section to cross reference ICC's current policy of
maintaining cash and collateral assets posted by CPs (on behalf of
themselves and/or their clients) to meet currency-specific Initial
Margin (``IM'') and GF requirements, to ensure ICC has sufficient total
resources in the required currencies of denomination.
Acceptable Collateral
    The `acceptable collateral' section remains the same, and notes
that CPs may post IM and GF deposits that meet ICC's acceptable
collateral criteria as

described in ICC's Treasury Operations Policies and Procedures and
Schedule 401 of the ICC Rules.
Liquidity Requirements
    The `liquidity requirements' section sets forth ICC's liquidity
requirements for house/proprietary accounts and client-related
accounts. Such requirements are also set forth in ICC's Treasury
Operations Policies and Procedures and Schedule 401 of the ICC Rules.
The `liquidity requirements' section will reflect the changes to ICC's
liquidity thresholds for Euro (``EUR'') denominated products set forth
in filing SR-ICC-2017-002.\3\ ICC revised the `liquidity requirements'
section to cross reference ICC's minimum U.S. Dollar (``USD'')
contribution to the Guaranty Fund (``GF'') of $20 million required from
every CP. This is not a change, but rather a statement of current
policy.\4\ ICC proposes revisions to the `liquidity requirements'
section to extend ICC's margin risk horizon up to 6-days, to account
for the risk associated with clearing Asia Pacific products. This
change will apply throughout the framework; the risk horizon is
reflected as ``N-day'' where N>=5 is the margin risk horizon or Margin
Period of Risk (MPOR). The margin risk horizon is based on the greatest
MPOR (rounded up to the nearest integer) for the CDS instruments
currently eligible for clearing in order to capture the risk associated
with clearing products across multiple time zones (i.e. if an
instrument is subject to 5.5 day MPOR estimations, then the scenarios
will reflect N=6).
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release No. 34-79988 (February
8, 2017), 82 FR 10611 (February 14, 2017). This rule change has been
approved by the Commission. See Securities Exchange Act Release No.
34-80324 (March 28, 2017), 82 FR 16244 (April 3, 2017). The text of
the proposed rule change for rule filing SR-ICC-2017-002 can also be
found on ICC's Web site at https://www.theice.com/clear-credit/regulation.
    \4\ Set forth in Schedule 401 of the ICC Rulebook.
---------------------------------------------------------------------------

Collateral Valuation Methodology
    The `collateral valuation methodology' section remains
substantially the same, and sets forth the method by which ICC prices
the assets posted as collateral, including haircut calculations.
Investment Strategy
    The `investment strategy section' remains substantially the same,
and sets forth a summary of ICC's investment strategy. ICC proposes
revisions to the `investment strategy' section to note that when
beneficial, ICC diversifies its cash investments across multiple
depository institutions to reduce its liquidity exposure to any single
depository.
CP Deposits as a Liquidity Pool
    The `CP deposits as a liquidity pool' section remains substantially
the same, and refers to the ability of ICC, pursuant to ICC Rules 402
and 804, to borrow GF and house origin IM cash deposits of non-
defaulting CPs and pledge non-cash and cash assets of an equivalent
value deposited by the defaulting and/or non-defaulting CP(s) as
collateral for this loan.
Liquidity Facilities
    ICC proposes revisions to the `liquidity facilities' section to add
reference to its committed repurchase facilities (as opposed to
committed repurchase agreements). ICC added reference to its recently
available committed FX facilities for converting USD cash to EUR cash.
ICC also proposes removing reference to FX Swaps, Immediate FX Spot
Transactions, because these arrangements do not count as ``qualifying
liquidity resources'' under CFTC Regulation 39.33,\5\ as they are not
committed. ICC also proposes removing reference to the Intercontinental
Exchange, Inc. committed line of credit, as ICC no longer participates
in the arrangement. ICC's liquidity is not negatively impacted by the
proposed changes, as the committed repo facilities and committed FX
facilities (coupled with ICC cash and collateral deposits) ensure ICC
remains fully able to timely and effectively contain liquidity
pressures consistent with Rule 17Ad-22(d)(11).\6\ ICC proposes
analogous changes to the `liquidity waterfall' section to reflect the
deletion and addition of these references.
---------------------------------------------------------------------------

    \5\ 17 CFR 39.33
    \6\ 17 CFR 240.17Ad-22(d)(11).
---------------------------------------------------------------------------

Liquidity Waterfall
    Under the `liquidity waterfall' section, ICC proposes revisions to
its definition of Available Liquidity Resources (``ALR'') to note that
ALR consist of the available deposits currently in cash of the required
denomination, and the cash equivalent of the available deposits in
collateral types that ICC can convert to cash, in the required currency
of denomination, using all sources of liquidity available to it. For
reference, the liquidity waterfall classifies ALR on any given day into
four Levels. Level One includes the House IM and GF cash deposits of
the defaulting CP. Level Two includes GF cash deposits of: (i) ICC; and
(ii) non-defaulting CPs, which until ICC has consumed the cash
equivalent value of all defaulting CPs' IM and GF deposits, are
available to ICC after pledging an equivalent value of non-cash assets
(or cash assets in a different currency) from the defaulting CP's IM
deposits or GF deposits. Level Three includes House IM cash deposits of
the non-defaulting CPs, which are available to ICC after pledging an
equivalent value of non-cash assets (or cash assets in a different
currency) from the defaulting CP's IM deposits or GF deposits. Level
Three cash used by ICC is always a loan, against which it must provide
the equivalent Pledgeable Collateral from the GF deposits of the non-
defaulting CPs and ICC, and/or from the IM and/or GF deposits of the
defaulting CPs.
    Level Four includes ICC's committed repo facilities to convert U.S.
Treasuries to USD cash and ICC's committed FX facilities to convert USD
cash to EUR cash. Note that when determining ALR for stress testing
analyses purposes, to account for the risk associated with Foreign
Exchange (``FX'') rate fluctuations, i.e. USD/EUR and EUR/USD, when
profits and funds denominated in one currency are used to offset losses
denominated in other currencies, appropriate FX ``haircuts'' are
applied.
    ICC noted that ICC's liquidity stress testing and historical
liquidity analysis scenarios do not consider any tolerance for delayed
payouts. ICC also noted that, during a default management period, ICC
may initiate the liquidation of non-cash collateral and/or conversion
of cash collateral into the required currencies of denomination, so
that ICC has additional ALR to use according to the liquidity waterfall
on subsequent days of default management and/or is able to pay back
some or all of the cash previously borrowed in Levels Two to Four of
the liquidity waterfall.
Measurement and Monitoring
Methodology
    ICC proposes changes to the `methodology' section to change the
calculation for available liquidity resources. In the historical and
stress testing analysis, ICC proposes replacing the estimation of
minimum available liquid resources based on risk requirements with the
observation of cash and collateral on deposit (excluding cash that will
be unavailable by the applicable ICC Payout Deadline because it has
been invested by ICC). As such, ICC proposes removing the section from
the Liquidity Risk Management Framework which described the process for
computing the estimation of minimum available liquid resources. In

addition, ICC proposes removing other references throughout the
framework related to the estimation of minimum available liquid
resources. ICC is changing its approach based on feedback from the
CFTC, to ensure consistency with CFTC regulations, including CFTC
Regulation 39.33.\7\ Under the previous approach, ICC executed its
stress test analysis by using the minimum requirement amounts based on
ICC's liquidity thresholds set forth in Schedule 401 of the ICC Rules.
Under the revised approach, ICC proposes executing stress test analysis
by using the amount of assets currently on deposit.
---------------------------------------------------------------------------

    \7\ 17 CFR 39.33.
---------------------------------------------------------------------------

    ICC also proposes additional changes to the `methodology' section.
Among other things, the proposed revisions will clarify that ICC's
measurement and monitoring methodology assesses the adequacy of ICC's
established liquidity resources in response to historically observed
and hypothetically created (forward looking) scenarios with risk
horizons up to and including 6-days. The analyzed scenarios feature
assumptions that directly impact the ability of ICC to meet its payment
obligations. From available IM and GF collateral on deposit on the day
of the considered default(s), the analysis determines currency-specific
ALR by liquidity waterfall level, and compares these ALRs to the
currency-specific Liquidity Obligations resulting from the analyzed
scenarios on each day of the considered time horizon. To be
conservative, the analysis assumes no client-related ALR and that only
the day-1 ALR are available throughout the considered time horizon
(i.e. the analysis does not consider ICC's ability during the
considered time horizon to liquefy non-cash collateral on deposit or
transform the currency of cash on deposit).
Historical Analysis
    ICC proposes changes to the `historical analysis' section of the
framework. ICC proposes adding language to note that, as part of its
historical liquidity analysis, ICC analyzes historical data sets to
assess the level of liquidity coverage achieved for each currency.
Under the revised framework, ICC will continue to conduct a historical
liquidity analysis on both an individual AG basis and a cover-2 basis.
    ICC proposes the use of the Basel Traffic Light System \8\ to
determine if the minimum cash component of its risk requirements truly
covers historically observed 1-day liquidity obligations with a 99%
level of confidence. The proposed revisions are part of the `historical
analysis' section. ICC's risk requirements are designed to meet at
least a 99% N-day VaR equivalent level of coverage. CPs must meet their
IM and GF requirements with a minimum cash component equivalent to the
1-day portion of the N-day requirement, computed using the square-root-
of-time approach.\9\
---------------------------------------------------------------------------

    \8\ ``Supervisory Framework for the use of ``Backtesting'' in
Conjunction with the Internal Models Approach to Market Risk Capital
Requirements'', Section III: Supervisory framework for the
interpretation of backtesting results, Basel Committee on Banking
Supervision, January 1996.
    \9\ ``Amendment to the Capital Accord to Incorporate Market
Risk'', Basel Committee on Banking Supervision, January 1996.
---------------------------------------------------------------------------

    ICC proposes additional enhancements to the `historical analysis'
section to consider the simultaneous default of the two worst-case
Affiliate Groups (``AGs'') \10\ of CPs, rather than the two worst-case
CPs, in line with regulations, including 17 CFR 39.33(c)(1)(ii). Under
the revised framework, when computing a CP's combined house and client
origin liquidity obligation for the purposes of selecting which AGs are
considered to be in a state of default, ICC proposes to eliminate the
application of house origin gains against client origin losses, or
house origin losses against client origin gains. This analysis is
designed to demonstrate to what extent the liquidity resources
available to ICC were sufficient to meet historical single and multi-
day cover-2 Liquidity Obligations, consistent with 17 CFR
39.33(c)(1)(ii).
---------------------------------------------------------------------------

    \10\ An affiliated CPs is defined as any other CP that owns, is
owned by or is under common ownership with such a CP. The set of all
affiliated CPs is considered as a CP affiliate group. This term is
consistent with ``participant family'' as defined in 17 CFR
240.17Ad-22(12).
---------------------------------------------------------------------------

    ICC proposes enhancements to the `historical analysis' section to
note that, for each day of its historical analysis, and on a currency
specific basis, the Risk Department explores predefined cover-2
scenarios considering the default of the CPs within two AGs creating
the largest remaining Liquidity Obligation after applying the IM and GF
cash deposits of each constituent CP to that CP's Liquidity Obligation.
ICC's cover-2 analysis considers the liquidity resources provided by
the defaulting CPs, the GF and IM liquidity resources provided by the
non-defaulting CPs and ICC, and any externally available liquidity
resources.
    ICC proposes clarifying changes to the `historical analysis
section' to note that the prices considered for historical analysis
purposes are ``dirty'' prices as they include riskless (deterministic)
payments (i.e. upfront fees, coupon payments, credit event payments and
interest on mark-to-market margin). ICC proposes adding explanatory
language regarding its calculation of the N-day worst-case cumulative
(combined house and client origin) liquidity obligations. ICC proposes
removal of a measurement and monitoring framework diagram, deemed no
longer relevant or necessary in light of the larger changes to the
framework. Finally, ICC proposes revisions to note that ICC reports
cover-2 results from the observed immediate liquidity obligation
scenarios and the worst-case five-day liquidity obligation scenarios.
This audience of this reporting will depend on the results. ICC notes
that the results should exhibit no deficiencies of the combined
resources in Levels One through Four of the liquidity waterfall.
Stress Testing Analysis
    ICC proposes changes to the `stress testing' section of the
framework. Under the previously approved framework, ICC used predefined
scenarios believed to be potential market outcomes historically
observed, but with a very low probability of occurrence, as well as
scenarios that replicated observed instrument price changes during the
Lehman Brothers default. ICC also used predefined scenarios designed to
test the performance of the risk methodology under extreme conditions,
which ICC did not expect the market to realize.
    ICC proposes re-categorizing and adding to the stress testing
scenarios set forth in the `stress testing' section of the framework.
Under the revised framework, ICC has enhanced its description of its
historically observed extreme but plausible market scenarios, to note
that the scenarios define spread or price shocks based on observations
during specific historical events. The historical data set from which
ICC derives the proposed scenarios will continue to begin on April 1,
2007 and include periods of extreme market events such as the Bear
Stearns collapse, the Lehman Brothers default, the 2009 Credit Crisis,
the US ``Flash Crash'' event, and the European Sovereign Crisis. The
scenarios are similar to the stress testing currently performed under
the financial resources Stress Testing Framework.
    ICC proposes eliminating all scenarios not expected to be realized
as market outcomes (i.e. those considered extreme and not plausible).
Under the revised framework, ICC will continue to have the ability to
execute liquidity analyses based on extreme but not plausible
scenarios, on an ad-hoc basis. Further, ICC proposes revising the
`stress testing'

section to add 1-day, 2-day, and N-day analogues in place of existing
5-day scenarios. Under the revised framework, each historically
observed scenario will have three analogues, one representing a 1-day
horizon, one representing a 2-day horizon and one representing a N-day
horizon. Previously, only analogues representing a N-day horizon were
considered. The addition of the 1-day analogue will demonstrate ICC's
ability to meeting its immediate payment obligations over a one-day
period (e.g. intraday and same-day obligations), while the 2-day and N-
day analogues will demonstrate ICC's ability to meet its payment
obligations over a multiday period.
    ICC also proposes revising the `stress testing' section of the
framework to add a number of hypothetically constructed (forward
looking) extreme but plausible market scenarios comprised of a given
historically observed extreme but plausible market scenario and
additional stress enhancements representing forward looking
hypothetical adverse market events. Specifically, two sets of
hypothetically constructed (forward looking) extreme but plausible
market scenarios are proposed: Loss-given default scenarios, and one-
service-provider-down scenarios. The loss-given default scenarios
consider the addition of up to three adverse credit events including
the holder of the considered portfolio, one additional CP name and one
additional non-CP name. The one-service-provider-down scenarios
consider a reduction in ALR designed to represent ICC's worst-case
exposure to a single service provider at which it maintains cash
deposits or investments, due to ICC's potential inability to access
those deposits and/or investments when required. ICC proposes that the
reduction in ALR used in the one-service-provider-down scenarios is
based on ICC's analysis of the diversification of its deposits and
investments across its multiple service providers.
    ICC proposes revisions to the `stress testing' section to further
describe its analysis under the above referenced scenarios. ICC
proposes revisions to consider the simultaneous default of the two
worst-case Affiliate Groups (``AGs'') \11\ of CPs, rather than the two
worst-case CPs, in line with regulations, including 17 CFR
39.33(c)(1)(ii). ICC will perform cover-2 analysis in which, for each
scenario, it determines the two AGs creating the largest remaining
Liquidity Obligation after applying the IM and GF cash deposits of each
constituent CP to its own Liquidity Obligation. ICC compares the
remaining Liquidity Obligation of the AG to the remaining liquidity
resources to determine if there are sufficient resources to meet the
obligation.
---------------------------------------------------------------------------

    \11\ An affiliated CPs is defined as any other CP that owns, is
owned by or is under common ownership with such a CP. The set of all
affiliated CPs is considered as a CP affiliate group. This term is
consistent with ``participant family'' as defined in 17 CFR
240.17Ad-22(12).
---------------------------------------------------------------------------

    ICC proposes enhancements to the `stress testing' section to
describe its cover-N analysis in which, for each scenario, it first
considers the default of one AG, then the defaults of two AGs, then
three AGs, and so forth. The sequence of selecting AGs is based on the
remaining Liquidity Obligation associated with the constituent CP's
portfolios after applying the IM and GF cash deposits of each
constituent CP to its own Liquidity Obligation. AGs are sequenced from
largest to smallest remaining Liquidity Obligation. For each set of AGs
considered to be in a state of default (1 AG, 2 AGs, 3 AGs, etc.), ICC
compares the total remaining Liquidity Obligation to the remaining
liquidity resources to determine if there are sufficient resources to
meet the obligation. In this way, ICC determines how many AGs it would
require to be in a state of default to consume all available liquidity
resources.
    To determine the Liquidity Obligations in the above analysis, ICC
applies the stress scenarios to actual cleared portfolios to determine
a currency-specific profit/loss for each CP, representing the largest
cumulative loss over the specified risk horizon. The considered profit/
loss in the analysis is the sum of the upfront fee changes
corresponding to the clean prices associated with the hypothetical
scenarios, and excluding the riskless (deterministic) payments.
    To determine ICC's liquidity needs for each scenario, the Risk
Department computes Liquidity Obligations for FCM/BD CPs by combining
the net payments for house and client origin accounts. For the purposes
of selecting defaulting AGs, the Risk Department does not offset client
origin losses with house origin gains, or offset house origin losses
with client origin gains.
Governance
Required Analysis
    The `required analysis' section remains substantially the same. The
ICC Risk Department executes stress testing daily, with weekly
reporting to different audiences depending on the results. The Risk
Department also executes monthly historical liquidity adequacy analyses
and reviews the results monthly, with monthly reporting to different
audiences depending on the results.
Interpretation of Results and Potential Actions
    The `interpretation of results and potential actions' section
remains substantially the same. Depending on the scenarios and the
frequency and severity of any resulting deficiencies, the Risk
Department may choose to make appropriate enhancements to its model.
Before enhancing its liquidity risk management model, ICC first
discusses such enhancements with its senior management team, and
subsequently consults with its Risk Working Group and Risk Committee
before submitting to the Board of Managers for approval.
Materiality and Reporting Framework
    ICC proposes changing the `materiality and reporting framework'
section to note that, at each Risk Committee meeting, the Risk
Department provides a summary of historical liquidity analysis and
liquidity stress testing analysis, which demonstrates the adequacy of
ICC's liquidity resources to cover Liquidity Obligations over N-days.
Such analyses will also include any instance where Level Three
resources were required to meet Liquidity Obligations in response to
any of the considered historical liquidity or liquidity stress testing
scenarios.
    ICC proposes revisions to the `materiality and reporting framework'
to note that, when exceedances of funded and/or unfunded resources are
identified, the Risk Department is required to report them to the
senior management team and the ICC Risk Committee, and (i) demonstrate
breaches do not highlight a significant liquidity risk management
weaknesses, or (ii) recommend specific liquidity risk management model
enhancements that produce an adequate increase in funded and/or
unfunded liquidity resources under the identified scenario(s). In
addition to the reporting described above, the Risk Department will
also report to the Risk Committee any instances where the Basel Traffic
Light System categorizes the number of observed exceedances in its
individual AG historical analysis as being in the predefined ``red
zone''. In these instances, the Risk Department will discuss with the
Risk Committee the appropriateness of its liquidity thresholds, and if
appropriate, make revisions.

Model Validation
    ICC proposes revisions to the `model validation' section to note
that its Liquidity Risk Management Framework is under the purview of
the Model Validation Framework, and subject to initial validations.
Stress Testing Framework
    ICC proposes revisions to its Stress Testing Framework to unify the
stress testing scenarios with the liquidity stress testing scenarios
set forth in the Liquidity Risk Management Framework. ICC operates its
stress testing and liquidity stress testing on a unified set of stress
testing scenarios and system. As such, revisions to the stress testing
scenarios are necessary to ensure scenario unification, following
changes to the Liquidity Risk Management Framework. Such changes are
consistent with recently issued guidance for certain principles and key
considerations in the Committee on Payments and Market Infrastructures-
Board of the International Organization of Securities Commissions
Principles for Financial Market Infrastructures.\12\ The proposed
revisions are described in detail as follows.
---------------------------------------------------------------------------

    \12\ See CPMI-IOSCO Consultative Report, Resilience and recovery
of CCPs: Further guidance on the PFMI, dated August 2016 (http://www.bis.org/cpmi/publ/d149.pdf).
---------------------------------------------------------------------------

    ICC proposes to introduce Risk Factor specific scenarios for all
stress test scenarios. Previously, corporate single names were
considered at the sector level (as opposed to the Risk Factor level).
This change is reflected throughout the framework.
    ICC also proposes to add clarifying language to note that the
predefined stress testing scenarios set forth in its Stress Testing
Framework are applied to all cleared instruments, and that name-
specific scenarios are applied to all sovereign and corporate reference
entities.
    ICC also proposes revisions to extend ICC's margin risk horizon up
to 6-days, to account for the risk associated with clearing Asia
Pacific products. This change will apply throughout the framework; the
risk horizon is reflected as ``N-day'' where N>=5 is the margin risk
horizon or Margin Period of Risk (MPOR). The margin risk horizon is
based on the greatest MPOR (rounded up to the nearest integer) for the
CDS instruments currently eligible for clearing in order to capture the
risk associated with clearing products across multiple time zones (i.e.
if an instrument is subject to 5.5 day MPOR estimations, then the
scenarios will reflect N=6).
    ICC also proposes to revise its description of the ``Historically
Observed Extreme but Plausible Market Scenarios'' to note that the
stress spread changes considered as part of each scenario are extracted
from the market history of the most actively traded instrument for the
considered Risk Factors.
    ICC proposes to revise the ``Hypothetically Constructed (Forward
Looking) Extreme but Plausible Market Scenarios'' to ensure consistency
with the loss-given default stress scenario set forth in the Liquidity
Risk Management Framework, which combines a given historically observed
extreme but plausible market scenario with explicit Jump-to-Default
events. The proposed revisions specify that there will be up to two
reference entities selected for a hypothetical adverse credit event.
    ICC proposes to revise the description of the discordant scenarios
(i.e. scenarios under which selected risk factors move in opposite
directions; commonly the behavior deviates from historically observed
behavior) in the Stress Testing Framework, in order to reflect the
introduction of Risk Factor specific scenarios. The discordant
scenarios are designed to reproduce significant discordant market
outcomes observed during the considered historical period. ICC creates
discordant scenarios for North American corporate single names and
indices; European corporate single names and indices; and sovereign
reference entities.
2. Statutory Basis
    Section 17A(b)(3)(F) of the Act \13\ requires, among other things,
that the rules of a clearing agency be designed to promote the prompt
and accurate clearance and settlement of securities transactions, and
to the extent applicable, derivative agreements, contracts and
transactions and to comply with the provisions of the Act and the rules
and regulations thereunder. ICC believes that the proposed rule changes
are consistent with the requirements of the Act and the rules and
regulations thereunder applicable to ICC, in particular, to Section
17(A)(b)(3)(F),\14\ because ICC believes that the proposed rule changes
will promote the prompt and accurate clearance and settlement of
securities transactions, derivatives agreements, contracts, and
transactions. ICC's Liquidity Risk Management Framework describes ICC's
liquidity resources as well as the methodology for testing the
sufficiency of these resources. The various elements set forth in the
Liquidity Risk Management Framework, and described above, ensure that
ICC has sufficient liquidity resources to effectively measure, monitor
and manage its liquidity risk. Further, the Liquidity Risk Management
Framework supports ICC's ability to maintain sufficient liquid
resources in all relevant currencies to effect same-day and, where
appropriate, intraday and multiday settlement of payment obligations
with a high degree of confidence under a wide range of potential stress
scenarios. As such, the proposed rule changes are designed to promote
the prompt and accurate clearance and settlement of securities
transactions, derivatives agreements, contracts, and transactions
within the meaning of Section 17A(b)(3)(F) \15\ of the Act.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78q-1(b)(3)(F).
    \14\ Id.
    \15\ Id.
---------------------------------------------------------------------------

    Further, the changes to the Stress Testing Framework to unify the
stress testing scenarios with the stress testing scenarios set forth in
the Liquidity Risk Management Framework are necessary following recent
changes to the Liquidity Risk Management Framework, as ICC operates its
stress testing and liquidity stress testing on a unified set of stress
testing scenarios and system. ICC's stress testing practices will
continue to ensure the adequacy of systemic risk protections. As such,
the proposed rule changes are designed to promote the prompt and
accurate clearance and settlement of securities transactions,
derivatives agreements, contracts, and transactions within the meaning
of Section 17A(b)(3)(F) \16\ of the Act. The proposed changes will also
satisfy the requirements of Rule 17Ad-22.\17\ The revised stress test
scenarios set forth in the Stress Testing Framework will continue to
ensure that ICC maintains sufficient financial resources to withstand a
default by the Clearing Participant (``CP'') family to which it has the
largest exposure in extreme but plausible market conditions, consistent
with the requirements of Rule 17Ad-22(b)(3).\18\
---------------------------------------------------------------------------

    \16\ Id.
    \17\ 17 CFR 240.17Ad-22.
    \18\ 17 CFR 240.17Ad-22(b)(3).
---------------------------------------------------------------------------

B. Clearing Agency's Statement on Burden on Competition

    ICC does not believe the proposed rule changes would have any
impact, or impose any burden, on competition. The Liquidity Risk
Management Framework and the Stress Testing Framework apply uniformly
across all CPs. Therefore, ICC does not believe the proposed rule
changes impose any

burden on competition that is inappropriate in furtherance of the
purposes of the Act.

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

    Written comments relating to the proposed rule change have not been
solicited or received. ICC will notify the Commission of any written
comments received by ICC.

III. Date of Effectiveness of the Proposed Rule Change

    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 such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-ICC-2017-005 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-ICC-2017-005. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change, security-
based swap submission, or advance notice that are filed with the
Commission, and all written communications relating to the proposed
rule change, security-based swap submission, or advance notice between
the Commission and any person, other than those that may be withheld
from the public in accordance with the provisions of 5 U.S.C. 552, will
be available for Web site viewing and printing in the Commission's
Public Reference Room, 100 F Street NE., Washington, DC 20549, on
official business days between the hours of 10:00 a.m. and 3:00 p.m.
Copies of such filings will also be available for inspection and
copying at the principal office of ICE Clear Credit and on ICE Clear
Credit's Web site at https://www.theice.com/clear-credit/regulation.
    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-ICC-2017-005
and should be submitted on or before June 27, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
---------------------------------------------------------------------------

    \19\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-11603 Filed 6-5-17; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 87, Number 114 (Tuesday, June 14, 2022)]
[Notices]
[Pages 35980-35981]
[FR Doc No: 2022-12766]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. IC22-14-000]

Commission Information Collection Activities (FERC-604) Comment
Request; Extension

AGENCY: Federal Energy Regulatory Commission, Department of Energy.

ACTION: Notice of information collection and request for comments.

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

SUMMARY: In compliance with the requirements of the Paperwork Reduction
Act of 1995 (PRA), the Federal Energy Regulatory Commission (Commission
or FERC) is soliciting public comment on the currently approved
requirements and burden of information collection, FERC- 604 (Cash
Management Agreements).

DATES: Comments on the collections of information are due August 15,
2022.

ADDRESSES: You may submit comments (identified by Docket No. IC22-14-
000) on FERC-604 by one of the following methods. Electronic filing
through http://www.ferc.gov is preferred.
     Electronic Filing: Documents must be filed in acceptable
native applications and print-to-PDF, but not in scanned or picture
format.
     For those unable to file electronically, comments may be
filed by USPS mail or by hand (including courier) delivery:
    [cir] Mail via U.S. Postal Service Only: Addressed to: Federal
Energy Regulatory Commission, Secretary of the Commission, 888 First
Street NE, Washington, DC 20426.
    [cir] Hand (Including Courier) Delivery: Deliver to: Federal Energy
Regulatory Commission, 12225 Wilkins Avenue, Rockville, MD 20852.
    Instructions: All submissions must be formatted and filed in
accordance with submission guidelines at: http://www.ferc.gov. For user
assistance, contact FERC Online Support by email at
[email protected], or by phone at<PHONE_NUMBER> (toll-free).
    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.

FOR FURTHER INFORMATION CONTACT: Ellen Brown may be reached by email at
[email protected], or by telephone at<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:
    Title: FERC-604 (Cash Management Agreements).
    OMB Control No.: 1902-0267.
    Type of Request: Three-year extension of the FERC-604 with no
changes to the current reporting requirements.
    Abstract: This collection of information is authorized by the
following statutory provisions:
     Sections 8 and 10 of the Natural Gas Act (15 U.S.C. 717g
and 717i);
     Sections 301 and 304 of the Federal Power Act (16 U.S.C.
835 and 825c); and
     Sections 20(1) and 20(5) of the Interstate Commerce Act
(49 App. U.S.C. 20(1) and 20(5)).
    Cash management or ``money pool'' programs typically concentrate
affiliates' cash assets in joint accounts for the purpose of providing
financial flexibility and lowering the cost of borrowing. In a 2001
investigation, FERC staff found that balances in cash management
programs affecting FERC-regulated entities totaled approximately $16
billion. Additionally, other investigations revealed large transfers of
funds (amounting to more than $1 billion) between regulated pipeline
affiliates and non-regulated parents whose financial conditions were
precarious. The Commission found that

these and other fund transfers and the enormous (mostly unregulated)
pools of money in cash management programs could detrimentally affect
regulated rates.
    To protect customers and promote transparency, the Commission
issued Order 634-A (2003) requiring entities to formalize in writing
and file with the Commission their cash management agreements. At that
time, the Commission obtained OMB clearance for this new reporting
requirement under the FERC-555 information collection (OMB Control No.
1902-0098). Now, the Commission includes these reporting requirements
for cash management agreements under the FERC-604 information
collection (OMB Control No. 1902-0267). The Commission implemented
these reporting requirements in 18 CFR 141.500, 260.400, and 357.5.
    Type of Respondents: Public utilities, natural gas companies, and
oil pipeline companies.
    Estimate of Annual Burden.\1\ The Commission estimates the annual
public reporting burden for the information collection as:
---------------------------------------------------------------------------

    \1\ Burden is defined as 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. See 5
CFR 1320 for additional information on the definition of information
collection burden.
    \2\ The Commission staff estimates that the industry's hourly
cost for wages plus benefits is similar to the Commission's $87.00
FY 2021 average hourly cost for wages and benefits.

                                                          FERC-604, Cash Management Agreements
--------------------------------------------------------------------------------------------------------------------------------------------------------
                    Number of
   Number of      responses per    Total  number  of   Average burden hours &  average cost      Total annual burden hours & total         Cost per
  respondents       respondent         responses              \2\ per  response  ($)                     annual cost  ($)               respondent  ($)
(1)                         (2)     (1) * (2) = (3)   (4)...................................  (3) * (4) = (5).......................    (5) / (1) = (6)
--------------------------------------------------------------------------------------------------------------------------------------------------------
            45                1                  45   1.5 hours; $130.50....................  67.5 hours; $5,872.50.................            $130.50
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Comments: Comments are invited on: (1) whether the collections of
information are 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 estimates of the
burden and cost of the collections of information, including the
validity of the methodology and assumptions used; (3) ways to enhance
the quality, utility and clarity of the information collections; and
(4) ways to minimize the burden of the collections of information on
those who are to respond, including the use of automated collection
techniques or other forms of information technology.

    Dated: June 8, 2022.
Kimberly D. Bose,
Secretary.
[FR Doc. 2022-12766 Filed 6-13-22; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 88, Number 13 (Friday, January 20, 2023)]
[Proposed Rules]
[Pages 3678-3680]
[FR Doc No: 2023-00955]

========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.

========================================================================

Federal Register / Vol. 88, No. 13 / Friday, January 20, 2023 /
Proposed Rules

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2023-0019; Project Identifier MCAI-2022-01155-T]
RIN 2120-AA64

Airworthiness Directives; Airbus SAS Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: The FAA proposes to adopt a new airworthiness directive (AD)
for all Airbus SAS Model A330-202, -203, -223, and -243 airplanes;
Model A330-200 Freighter series airplanes; Model A330-300 series
airplanes; Model A340-200 series airplanes; and Model A340-300 series
airplanes. This proposed AD was prompted by a report that damage was
found to the firewall and fuselage skin in the auxiliary power unit
(APU) compartment area on Model A330 airplanes. This proposed AD would
require replacing affected tee ducts with serviceable parts, as
specified in a European Union Aviation Safety Agency (EASA) AD, which
is proposed for incorporation by reference (IBR). This proposed AD
would also prohibit the installation of affected parts. The FAA is
proposing this AD to address the unsafe condition on these products.

DATES: The FAA must receive comments on this proposed AD by March 6,
2023.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to regulations.gov. Follow
the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: Deliver to Mail address above between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    AD Docket: You may examine the AD docket at regulations.gov under
Docket No. FAA-2023-0019; or in person at Docket Operations between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD
docket contains this NPRM, the mandatory continuing airworthiness
information (MCAI), any comments received, and other information. The
street address for Docket Operations is listed above.
    Material Incorporated by Reference:
     For EASA material that is proposed for IBR in this NPRM,
contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; telephone
+49 221 8999 000; email [email protected]; website easa.europa.eu. You
may find this material on the EASA website at ad.easa.europa.eu. It is
also available at regulations.gov under Docket No. FAA-2023-0019.
     You may view this service information at the FAA,
Airworthiness Products Section, Operational Safety Branch, 2200 South
216th St., Des Moines, WA. For information on the availability of this
material at the FAA, call<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Vladimir Ulyanov, Aerospace Engineer,
Large Aircraft Section, FAA, International Validation Branch, 2200
South 216th St., Des Moines, WA 98198; telephone<PHONE_NUMBER>; email
[email protected].

SUPPLEMENTARY INFORMATION:

Comments Invited

    The FAA invites you to send any written relevant data, views, or
arguments about this proposal. Send your comments to an address listed
under ADDRESSES. Include ``Docket No. FAA-2023-0019; Project Identifier
MCAI-2022-01155-T'' at the beginning of your comments. The most helpful
comments reference a specific portion of the proposal, explain the
reason for any recommended change, and include supporting data. The FAA
will consider all comments received by the closing date and may amend
this proposal because of those comments.
    Except for Confidential Business Information (CBI) as described in
the following paragraph, and other information as described in 14 CFR
11.35, the FAA will post all comments received, without change, to
regulations.gov, including any personal information you provide. The
agency will also post a report summarizing each substantive verbal
contact received about this NPRM.

Confidential Business Information

    CBI is commercial or financial information that is both customarily
and actually treated as private by its owner. Under the Freedom of
Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public
disclosure. If your comments responsive to this NPRM contain commercial
or financial information that is customarily treated as private, that
you actually treat as private, and that is relevant or responsive to
this NPRM, it is important that you clearly designate the submitted
comments as CBI. Please mark each page of your submission containing
CBI as ``PROPIN.'' The FAA will treat such marked submissions as
confidential under the FOIA, and they will not be placed in the public
docket of this NPRM. Submissions containing CBI should be sent to
Vladimir Ulyanov, Aerospace Engineer, Large Aircraft Section, FAA,
International Validation Branch, 2200 South 216th St., Des Moines, WA
98198; telephone<PHONE_NUMBER>; email [email protected]. Any
commentary that the FAA receives which is not specifically designated
as CBI will be placed in the public docket for this rulemaking.

Background

    EASA, which is the Technical Agent for the Member States of the
European Union, has issued EASA AD 2022-0175, dated August 23, 2022
(EASA AD 2022-0175) (also referred to as the MCAI), to correct an
unsafe condition for all Airbus SAS Model A330-202, A330-203, A330-223,
A330-223F, A330-243, A330-243F, A330-301, A330-302, A330-303, A330-321,
A330-322, A330-323, A330-341, A330-342, A330-343, A340-211, A340-212,
A340-213, A340-311, A340-312 and A340-313 airplanes.
    This proposed AD was prompted by a report that damage was found to
the firewall and fuselage skin in the APU compartment area on Model
A330 airplanes. Subsequent investigation determined that cracks started
because of high cycle fatigue in the tee duct,

which led to a hot air leak. Due to the design similarity, this
condition could also exist or develop on Model A340 airplanes. The FAA
is proposing this AD to address cracks in the tee duct. This condition,
if not corrected, could lead to a hot air leak from the tee duct and
damage to the APU compartment firewall, possibly jeopardizing its
capability to contain a fire.
    You may examine the MCAI in the AD docket at regulations.gov under
Docket No. FAA-2023-0019.

Related Service Information Under 1 CFR Part 51

    EASA AD 2022-0175 specifies procedures for replacement of affected
tee ducts (Part Number (PN) 3884654-4 or PN 3884654-5) with serviceable
parts (PN 3884654-6). EASA AD 2022-0175 also prohibits the installation
of affected parts. This material is reasonably available because the
interested parties have access to it through their normal course of
business or by the means identified in ADDRESSES.

FAA's Determination

    This product has been approved by the aviation authority of another
country and is approved for operation in the United States. Pursuant to
the FAA's bilateral agreement with the State of Design Authority, it
has notified the FAA of the unsafe condition described in the MCAI
described above. The FAA is issuing this NPRM after determining that
the unsafe condition described previously is likely to exist or develop
in other products of the same type design.

Proposed AD Requirements in This NPRM

    This proposed AD would require accomplishing the actions specified
in EASA AD 2022-0175 described previously, except for any differences
identified as exceptions in the regulatory text of this proposed AD.

Explanation of Required Compliance Information

    In the FAA's ongoing efforts to improve the efficiency of the AD
process, the FAA developed a process to use some civil aviation
authority (CAA) ADs as the primary source of information for compliance
with requirements for corresponding FAA ADs. The FAA has been
coordinating this process with manufacturers and CAAs. As a result, the
FAA proposes to incorporate EASA AD 2022-0175 by reference in the FAA
final rule. This proposed AD would, therefore, require compliance with
EASA AD 2022-0175 in its entirety through that incorporation, except
for any differences identified as exceptions in the regulatory text of
this proposed AD. Using common terms that are the same as the heading
of a particular section in EASA AD 2022-0175 does not mean that
operators need comply only with that section. For example, where the AD
requirement refers to ``all required actions and compliance times,''
compliance with this AD requirement is not limited to the section
titled ``Required Action(s) and Compliance Time(s)'' in EASA AD 2022-
0175. Service information required by EASA AD 2022-0175 for compliance
will be available at regulations.gov under Docket No. FAA-2023-0019
after the FAA final rule is published.

Costs of Compliance

    The FAA estimates that this AD, if adopted as proposed, would
affect 123 airplanes of U.S. registry. The FAA estimates the following
costs to comply with this proposed AD:

                                      Estimated Costs for Required Actions
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per       Cost on U.S.
                          Labor cost                              Parts cost        product         operators
----------------------------------------------------------------------------------------------------------------
4 work-hours x $85 per hour = $340...........................         $35,931          $36,271       $4,461,333
----------------------------------------------------------------------------------------------------------------

    The FAA has included all known costs in its cost estimate.
According to the manufacturer, however, some or all of the costs of
this proposed AD may be covered under warranty, thereby reducing the
cost impact on affected operators.

Authority for This Rulemaking

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

Regulatory Findings

    The FAA determined that this proposed AD would not have federalism
implications under Executive Order 13132. This proposed AD would not
have a substantial direct effect on the States, on the relationship
between the national Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
    For the reasons discussed above, I certify this proposed
regulation:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Would not affect intrastate aviation in Alaska, and
    (3) Would not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

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

The Proposed Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

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

Airbus SAS: Docket No. FAA-2023-0019; Project Identifier MCAI-2022-
01155-T.

(a) Comments Due Date

    The FAA must receive comments on this airworthiness directive
(AD) by March 6, 2023.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to all Airbus SAS airplanes specified in
paragraphs (c)(1) through (5) of this AD, certificated in any
category.
    (1) Model A330-202, -203, -223, and -243 airplanes.
    (2) Model A330-223F and -243F airplanes.
    (3) Model A330-301, -302, -303, -321, -322, -323, -341, -342,
and -343 airplanes.
    (4) Model A340-211, -212, and -213 airplanes.
    (5) Model A340-311, -312, and -313 airplanes.

(d) Subject

    Air Transport Association (ATA) of America Code 49, Airborne
Auxiliary Power.

(e) Unsafe Condition

    This AD was prompted by a report that damage was found to the
firewall and fuselage skin in the auxiliary power unit (APU)
compartment area on Model A330 airplanes. Subsequent investigation
determined that cracks started because of high cycle fatigue in the
tee duct, which led to a hot air leak. The FAA is issuing this AD to
address cracks in the tee duct. This condition, if not corrected,
could lead to a hot air leak from the tee duct and damage to the APU
compartment firewall, possibly jeopardizing its capability to
contain a fire.

(f) Compliance

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

(g) Requirements

    Except as specified in paragraph (h) of this AD: Comply with all
required actions and compliance times specified in, and in
accordance with, European Union Aviation Safety Agency (EASA) AD
2022-0175, dated August 23, 2022 (EASA AD 2022-0175).

(h) Exceptions to EASA AD 2022-0175

    (1) Where EASA AD 2022-0175 refers to its effective date, this
AD requires using the effective date of this AD.
    (2) The ``Remarks'' section of EASA AD 2022-0175 does not apply
to this AD.

(i) Additional AD Provisions

    The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager,
International Validation Branch, FAA, has the authority to approve
AMOCs for this AD, if requested using the procedures found in 14 CFR
39.19. In accordance with 14 CFR 39.19, send your request to your
principal inspector or responsible Flight Standards Office, as
appropriate. If sending information directly to the International
Validation Branch, send it to the attention of the person identified
in paragraph (j) of this AD. Information may be emailed to: [email protected]. Before using any approved AMOC, notify your
appropriate principal inspector, or lacking a principal inspector,
the manager of the responsible Flight Standards Office.
    (2) Contacting the Manufacturer: For any requirement in this AD
to obtain instructions from a manufacturer, the instructions must be
accomplished using a method approved by the Manager, International
Validation Branch, FAA; or EASA; or Airbus SAS's EASA Design
Organization Approval (DOA). If approved by the DOA, the approval
must include the DOA-authorized signature.
    (3) Required for Compliance (RC): Except as required by
paragraph (i)(2) of this AD, if any service information contains
procedures or tests that are identified as RC, those procedures and
tests must be done to comply with this AD; any procedures or tests
that are not identified as RC are recommended. Those procedures and
tests that are not identified as RC may be deviated from using
accepted methods in accordance with the operator's maintenance or
inspection program without obtaining approval of an AMOC, provided
the procedures and tests identified as RC can be done and the
airplane can be put back in an airworthy condition. Any
substitutions or changes to procedures or tests identified as RC
require approval of an AMOC.

(j) Additional Information

    For more information about this AD, contact Vladimir Ulyanov,
Aerospace Engineer, Large Aircraft Section, FAA, International
Validation Branch, 2200 South 216th St., Des Moines, WA 98198;
telephone<PHONE_NUMBER>; email [email protected].

(k) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) of the service information listed
in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless this AD specifies otherwise.
    (i) European Union Aviation Safety Agency (EASA) AD 2022-0175,
dated August 23, 2022.
    (ii) [Reserved]
    (3) For EASA AD 2022-0175, contact EASA, Konrad-Adenauer-Ufer 3,
50668 Cologne, Germany; telephone +49 221 8999 000; email
[email protected]; website easa.europa.eu. You may find this EASA
AD on the EASA website at ad.easa.europa.eu.
    (4) You may view this service information at the FAA,
Airworthiness Products Section, Operational Safety Branch, 2200
South 216th St., Des Moines, WA. For information on the availability
of this material at the FAA, call<PHONE_NUMBER>.
    (5) You may view this service information that is incorporated
by reference at the National Archives and Records Administration
(NARA). For information on the availability of this material at
NARA, email [email protected], or go to: www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued on January 13, 2023.
Gaetano A. Sciortino,
Acting Director, Compliance & Airworthiness Division, Aircraft
Certification Service.
[FR Doc. 2023-00955 Filed 1-19-23; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 88, Number 41 (Thursday, March 2, 2023)]
[Proposed Rules]
[Page 13071]
[FR Doc No: 2023-04233]

========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.

========================================================================

Federal Register / Vol. 88, No. 41 / Thursday, March 2, 2023 /
Proposed Rules

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 21, 25, and 29

[Docket No. FAA-2023-0515]

Draft Policy Statement Regarding Submission of Outline of New and
Changed Systems at the Beginning of the Type Certificate Amendment
Process for Transport Category Aircraft

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notification of availability; request for comments.

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

SUMMARY: As required by the Aircraft Certification, Safety, and
Accountability Act, a draft policy statement would revise FAA
procedures in order to require applicants for amendments to type
certificates (TCs) for transport category aircraft to disclose, in a
single document at the beginning of the certification process, all new
systems and intended changes to existing systems known to the
applicant.

DATES: Comments on the draft policy statement must be received on or
before April 3, 2023.

ADDRESSES: Send comments with the subject line, ``Outline of New and
Changed Systems for Transport Category Aircraft'' identified by docket
number FAA-2023-0515, using the following method:
    Federal eRegulations Portal: Go to https://www.regulations.gov and
follow the online instructions for sending your comments
electronically.
    Mail: Send comments to Docket Operations, M-30, U.S. Department of
Transportation (DOT), 1200 New Jersey Avenue SE, Room W12-140, West
Building Ground Floor, Washington, DC 20590-0001.
    Hand Delivery of Courier: Take comments to Docket Operations in
Room W12-140 of the West Building Ground Floor at 1200 New Jersey
Avenue SE, Washington, DC, between 9 a.m., and 5 p.m., Monday through
Friday, except Federal holidays.
    Fax: Fax comments to Docket Operations at<PHONE_NUMBER>.
    Privacy: In addition to the final policy statement, the FAA will
post all comments it receives, without change, to https://www.regulations.gov/, including any personal information the commenter
provides. DOT's complete Privacy Act Statement can be found in the
Federal Register published on April 11, 2000 (65 FR 19477-19478), as
well as at https://DocketsInfo.dot.gov.

FOR FURTHER INFORMATION CONTACT: Sue McCormick, Strategic Policy
Systems Standards Section, AIR-619, Strategic Policy Management Branch,
Policy and Innovation Divison, Aircraft Certification Service, by email
at [email protected], or by phone at<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Discussion

    Section 105(c) of the Aircraft Certification, Safety, and
Accountability Act, Public Law 116-260 (the Act) requires the FAA to
revise its procedures in order to require applicants for amendments to
TCs for transport category aircraft to disclose, in a single document
at the beginning of the certification process, all new systems and
intended changes to existing systems known to the applicant. Transport
category aircraft are transport category airplanes and transport
category rotorcraft. The FAA would issue a policy statement to
implement section 105(c), and a draft of the policy statement may be
examined in the docket and at https://www.faa.gov/aircraft/draft/docs/.

Comments Invited

    The FAA invites the public to submit comments on the draft policy
statement, as specified in the ADDRESSES section of this notification.
Commenters should include the subject line, ``Outline of New and
Changed Systems for Transport Category Aircraft,'' and the docket
number on all comments submitted to the FAA. The most helpful comments
will reference a specific recommendation, explain the reason for any
recommended change, and include supporting information. The FAA will
consider all comments received on or before the closing date, before
issuing the final policy statement. The FAA will also consider late-
filed comments, if it is possible to do so without incurring expense or
delay.

    Issued in Washington, DC, on February 24, 2023.
James D. Foltz,
Acting Manager, Strategic Policy Management Branch, Policy and
Innovation Division, Aircraft Certification Service.
[FR Doc. 2023-04233 Filed 3-1-23; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 83, Number 102 (Friday, May 25, 2018)]
[Proposed Rules]
[Pages 24267-24269]
[FR Doc No: 2018-11313]

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

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R05-OAR-2017-0279; FRL-9978-64--Region 5]

Approval and Promulgation of Air Quality Implementation Plans;
Wisconsin; VOC Definition Update and Removal of Obsolete Gasoline Vapor
Recovery Regulations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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

SUMMARY: EPA is proposing to approve a request submitted by the
Wisconsin Department of Natural Resources (WDNR) on May 16, 2017, to
revise the Wisconsin State Implementation Plan (SIP). The submission
includes amendments to the Wisconsin Administrative Code updating the
definition of ``volatile organic compound (VOC)'' to add eight
compounds to the list of exempted compounds. These revisions are based
on EPA rulemakings in 2012, 2013, and 2014, which added these compounds
to the list of chemical compounds that are excluded from the Federal
definition of VOC because, in their intended used, they make negligible
contributions to tropospheric ozone formation. In addition, WDNR is
also requesting to withdraw several previously approved provisions of
the Wisconsin Administrative Code from the SIP concerning the State's
Stage II vapor recovery (Stage II) program that terminated in 2012. EPA
approved the removal of the Stage II program as a component of the
Wisconsin SIP in 2013, including the approval of a demonstration under
section 110(l) of the Clean Air Act (CAA) that addressed emissions
impacts associated with the removal of the program.

DATES: Comments must be received on or before June 25, 2018.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-
OAR-2017-0279 at http://www.regulations.gov, or via email to
[email protected]. For comments submitted at Regulations.gov,
follow the online instructions for submitting comments. Once submitted,
comments cannot be edited or removed from Regulations.gov. For either
manner of submission, EPA may publish any comment received to its
public docket. Do not submit electronically any information you
consider to be Confidential Business Information (CBI) or other
information whose disclosure is restricted by statute. Multimedia
submissions (audio, video, etc.) must be accompanied by a written
comment. The written comment is considered the official comment and
should include discussion of all points you wish to make. EPA will
generally not consider comments or comment contents located outside of
the primary submission (i.e., on the web, cloud, or other file sharing
system). For additional submission methods, please contact the person
identified in the FOR FURTHER INFORMATION CONTACT section. For the full
EPA public comment policy, information about CBI or multimedia
submissions, and general guidance on making effective comments, please
visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Francisco J. Acevedo, Mobile Source
Program Manager, Control Strategies Section, Air Programs Branch (AR-
18J), Environmental Protection Agency, Region 5, 77 West Jackson
Boulevard, Chicago, Illinois 60604,<PHONE_NUMBER>,
[email protected].

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,''
``us,'' or ``our'' is used, we mean EPA. This supplementary information
section is arranged as follows:

I. What is the background for this action?
    A. When did the State submit the SIP revision to EPA?
    B. Did Wisconsin hold public hearings on this SIP revision?
II. What is EPA proposing to approve?
III. What is EPA's analysis of the SIP revision?
IV. What action is EPA proposing to take?
V. Incorporation by Reference
VI. Statutory and Executive Order Reviews

I. What is the background for this action?

A. When did the State submit the SIP revision to EPA?

    WDNR submitted to EPA a revision to the Wisconsin SIP for approval
on May 16, 2017. The SIP revision primarily updates the definition of
VOC at Wisconsin Administrative Code Chapter NR 400.02(162) and removes
obsolete State provisions concerning the State's Stage II program that
terminated in 2012 in Southeast Wisconsin.

B. Did Wisconsin hold public hearings on this SIP revision?

    WDNR conducted a public hearing in Madison, Wisconsin on November
5, 2015.

II. What is EPA proposing to approve?

    EPA is proposing to approve a Wisconsin SIP revision that updates
the definition of VOC at Wisconsin Administrative Code Chapter NR
400.02(162) to add Trans-1,3,3,3-tetrafluoropropene (HFO-1234ze),
HCF2OCF2H (HFE-134),
HCF2OCF2OCF2H (HFE-236cal2),
HCF2OCF2CF2OCF2H (HFE-
338pcc13),
HCF2OCF2OCF2CF2OCF2
H (H-Galaden 1040X or H-Galden ZT 130 (or 150 or 180), Trans-1-chloro-
3,3,3-triflouroprop-1-ene (SolsticeTM 1233zd(E)), 2,3,3,3-
tetraflouropropene (HFO-1234yf), and 2-amino-2-methyl-1-propanol (AMP;
CAS number 124-68-5) to the list of excluded compounds at NR
400.02(162). Wisconsin took this action based on EPA's 2012, 2013, and
2014 rulemakings in which EPA determined that these compounds have a
negligible contribution to tropospheric ozone formation and thus should
be excluded from the definition of VOC codified at 40 CFR 51.100(s).
See 77 FR 37610 (June 22, 2012); 78 FR 9823 (February 12, 2013); 78 FR
62451 (October 22, 2013); 78 FR 53029 (August 28, 2013); and 79 FR
18037 (March 27, 2014). This action also proposes to approve minor
grammatical edits for clarity in NR 420.02(39), NR 420.03(4)(b)3, NR
420.04(1)(b)4, and NR 420.04(3)(c)1.
    EPA is also proposing to approve the withdrawal of several
remaining provisions from the Wisconsin SIP that are related to the
Stage II vapor recovery program that was terminated by Wisconsin in
2012. Wisconsin originally submitted a SIP revision to EPA on November
18, 1992, to satisfy the requirement of section 182(b)(3) of the CAA.
The revision applied to the counties of Kenosha, Kewanee, Manitowoc,
Milwaukee, Ozaukee, Racine, Sheboygan, Washington and Waukesha, and was
incorporated into the WDNR's 1993-94 ozone 15% Control Plan. EPA fully
approved Wisconsin's Stage II program on August 13, 1993 (53 FR 43080),
including the program's legal authority and administrative requirements
found in Section 285.31 of the Wisconsin Statutes and Chapter NR
420.045 of the Wisconsin Administrative Code.
    On November 12, 2012, WDNR submitted a SIP revision requesting the
removal of Stage II requirements under NR 420.045 of the Wisconsin
Administrative Code from the Wisconsin SIP. To support the removal of
the Stage II requirements, the revision included a section 110(l)
demonstration addressing the emissions impacts associated with the
removal of the program. On November 4, 2013 (78 FR 65875), EPA approved
the removal of the Stage II requirements under NR 420.045 of the
Wisconsin Administrative Code from the Wisconsin SIP. In this action
EPA proposes to approve the removal of the

residual Stage II provisions that remained in place after the program
was decommissioned. These provisions are NR 420.02(8m), 420.02(26),
420.02(32), 420.02(38m), NR 425.035, NR 439.06(3)(i), NR 484.05(4), NR
484.05(5), and NR 494.04.

III. What is EPA's analysis of the SIP revision?

    In 2005, EPA received a petition asking EPA to exempt
HCF2 OCF2H (HFE-134),
HCF2OCF2OCF2H (HFE-236cal2),
HCF2OCF2CF2OCF2H (HFE-
338pcc13), and
HCF2OCF2OCF2CF2OCF2
H (H-Galden 1040x or H-Galden ZT 130 (or 150 or 180)) from the
definition of VOC. Based on the level of reactivity of these chemical
compounds, EPA concluded that these compounds make negligible
contributions to tropospheric ozone formation (78 FR 9823, February 12,
2013). Therefore, on February 12, 2013, EPA amended 40 CFR 51.100(s)(1)
to exclude these compounds from the definition of VOC for purposes of
preparing SIPs to attain the national ambient air quality standard for
ozone under title I of the CAA (78 FR 9823). EPA's action became
effective March 14, 2013. Wisconsin's SIP revision is consistent with
EPA's action amending the definition of VOC at 40 CFR 51.100(s).
    In 2009, EPA received a petition asking EPA to exempt 2,3,3,3-
tetrafluoropropene (HFO-1234yf) from the definition of VOC. Based on
the level of reactivity of this chemical compound, EPA concluded that
this compound makes a negligible contribution to tropospheric ozone
formation (78 FR 62451, October 22, 2013). Therefore, on October 22,
2013, EPA amended 40 CFR 51.100(s)(1) to exclude this compound from the
definition of VOC for purposes of preparing SIPs to attain the national
ambient air quality standard for ozone under title I of the CAA (78 FR
62451). EPA's action became effective November 21, 2013. Wisconsin's
SIP revision is consistent with EPA's action amending the definition of
VOC at 40 CFR 51.100(s).
    In 2009, EPA received a petition asking EPA to exempt Trans-
1,3,3,3-tetrafluoropropene (HFO-1234ze) from the definition of VOC.
Based on the level of reactivity of this chemical compound, EPA
concluded that this compound makes a negligible contribution to
tropospheric ozone formation (77 FR 37610, June 22, 2012). Therefore,
on June 22, 2012, EPA amended 40 CFR 51.100(s)(1) to exclude this
compound from the definition of VOC for purposes of preparing SIPs to
attain the national ambient air quality standard for ozone under title
I of the CAA (77 FR 37610). EPA's action became effective July 23,
2012. Wisconsin's SIP revision is consistent with EPA's action amending
the definition of VOC at 40 CFR 51.100(s).
    In 2011, EPA received a petition asking EPA to exempt Trans 1-
chloro-3,3,3-trifluoroprop-1-ene from the definition of VOC. Based on
the level of reactivity of this chemical compound, EPA concluded that
this compound makes a negligible contribution to tropospheric ozone
formation (78 FR 53029, August 28, 2013). Therefore, on August 28,
2013, EPA amended 40 CFR 51.100(s)(1) to exclude this compound from the
definition of VOC for purposes of preparing SIPs to attain the national
ambient air quality standard for ozone under title I of the CAA (78 FR
53029). EPA's action became effective September 27, 2013. Wisconsin's
SIP revision is consistent with EPA's action amending the definition of
VOC at 40 CFR 51.100(s).
    In 2012, EPA received a petition asking EPA to exempt 2-amino-2-
methyl-1-propanol (AMP; CAS number 124-68-5) from the definition of
VOC. Based on the level of reactivity of this chemical compound, EPA
concluded that this compound makes a negligible contribution to
tropospheric ozone formation (79 FR 18037, March 27, 2014). Therefore,
on March 27, 2014, EPA amended 40 CFR 51.100(s)(1) to exclude this
compound from the definition of VOC for purposes of preparing SIPs to
attain the national ambient air quality standard for ozone under title
I of the CAA (79 FR 17037). EPA's action became effective June 25,
2014. Wisconsin's SIP revision is consistent with EPA's action amending
the definition of VOC at 40 CFR 51.100(s).
    As stated above, EPA has determined that the compounds outlined in
Wisconsin's SIP revision all qualify as negligibly reactive with
respect to their contribution to tropospheric ozone formation. Although
states are not obligated to exclude from control as VOCs those
compounds that the EPA has found to be negligibly reactive, states may
not take credit for controlling these compounds in their ozone control
strategies.
    In addition, the proposed approval of changes in NR 420.02(39), NR
420.03(4)(b)3, NR 420.04(1)(b)4, and NR 420.04(3)(c)1 are
administrative in nature only, and do not have any negative impact on
air quality.
    As discussed previously in this action, WDNR submitted a SIP
revision on November 12, 2012, requesting the removal of Stage II
requirements under NR 420.045 of the Wisconsin Administrative Code from
the Wisconsin SIP. To support the removal of the Stage II requirements,
the revision included a section 110(l) demonstration addressing the
emissions impacts associated with the removal of the program. On
November 4, 2013 (78 FR 65875) EPA approved the removal of the Stage II
requirements from the Wisconsin SIP. In this action EPA is proposing to
approve the removal of residual Stage II provisions NR 420.02(8m),
420.02(26), 420.02(32), 420.02(38m), NR 425.035, NR 439.06(3)(i), NR
484.05(4), NR 484.05(5), and NR 494.04, which remained in place after
the program was decommissioned at the state level. The removal of these
provisions from the SIP does not have any negative impact on air
quality in Southeast Wisconsin, since the state addressed the overall
emissions impact resulting from the 2012 termination of the Stage II
program. See 78 FR 65875.

IV. What action is EPA proposing to take?

    EPA is proposing to approve the revision to the Wisconsin SIP
submitted by WDNR on May 16, 2017, because the revision is consistent
with EPA's prior actions revising the definition of VOC. In addition,
the removal of remaining Stage II program provisions from the SIP meets
all applicable requirements, and it will not interfere with reasonable
further progress or attainment of any of the national ambient air
quality standards.

V. Incorporation by Reference

    In this rule, EPA is proposing to include in a final EPA rule
regulatory text that includes incorporation by reference. In accordance
with requirements of 1 CFR 51.5, EPA is proposing to incorporate by
reference revisions to Wisconsin Administrative Code provisions NR
400.02(162), NR 420.02(39), NR 420.0 3(4)(b)3, NR 420.04(1)(b)4, and NR
420.04(3)(c)1, published in the Wisconsin Register #727 on July 25,
2016 and became effective August 1, 2016. EPA has made, and will
continue to make, these documents generally available through
www.regulations.gov and at the EPA Region 5 Office (please contact the
person identified in the For FURTHER INFORMATION CONTACT section of
this preamble for more information).

VI. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission

that complies with the provisions of the CAA and applicable Federal
regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP
submissions, EPA's role is to approve state choices, provided that they
meet the criteria of the CAA. Accordingly, this action merely approves
State law as meeting Federal requirements and does not impose
additional requirements beyond those imposed by State law. For that
reason, this action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Orders
12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21,
2011);
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, the SIP is not approved to apply on any Indian
reservation land or in any other area where EPA or an Indian tribe has
demonstrated that a tribe has jurisdiction. In those areas of Indian
country, the rule does not have tribal implications and will not impose
substantial direct costs on tribal governments or preempt tribal law as
specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Intergovernmental relations, Nitrogen oxides, Ozone,
Volatile organic compounds.

    Dated: May 16, 2018.
Cathy Stepp,
Regional Administrator, Region 5.
[FR Doc. 2018-11313 Filed 5-24-18; 8:45 am]
 BILLING CODE 6560-50-P