[Federal Register: October 7, 2009 (Volume 74, Number 193)]
[Rules and Regulations]
[Page 51470-51474]
[DOCID:fr07oc09-6]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 180

[EPA-HQ-OPP-2009-0490; FRL-8439-1]

Sodium and Ammonium Naphthalenesulfonate Formaldehyde
Condensates; Exemption from the Requirement of a Tolerance

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This regulation establishes an exemption from the requirement
of a tolerance for residues of the sodium and ammonium
napthalenesulfonate formaldehyde condensates, herein referred to in
this document as the SANFCs, when used as inert ingredients in
pesticide formulations applied pre-harvest and post-harvest. The Joint
Inerts Task Force (JITF), Cluster Support Team Number 11 and Akzo Nobel
Surface Chemistry, LLC, submitted petitions to EPA under the Federal
Food, Drug, and Cosmetic Act (FFDCA), requesting an exemption from the
requirement of a tolerance. This regulation eliminates the need to
establish a maximum permissible level for residues of the SANFCs.

DATES: This regulation is effective October 7, 2009. Objections and
requests for hearings must be received on or before December 7, 2009,
and must be filed in accordance with the instructions provided in 40
CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

ADDRESSES: EPA has established a docket for this action under docket
identification (ID) number EPA-HQ-OPP-2009-0490. All documents in the
docket are listed in the docket index available at http://
www.regulations.gov. Although listed in the index, some information is
not publicly available, e.g., Confidential Business Information (CBI)
or other information whose disclosure is restricted by statute. Certain
other material, such as copyrighted material, is not placed on the
Internet and will be publicly available only in hard copy form.
Publicly available docket materials are available in the electronic
docket at http://www.regulations.gov, or, if only

available in hard copy, at the OPP Regulatory Public Docket in Rm. S-
4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington,
VA. The Docket Facility is open from 8:30 a.m. to 4 p.m., Monday
through Friday, excluding legal holidays. The Docket Facility telephone
number is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Elizabeth Fertich, Registration
Division (7505P), Office of Pesticide Programs, Environmental
Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-
0001; telephone number:<PHONE_NUMBER>; e-mail address:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this Action Apply to Me?

    You may be potentially affected by this action if you are an
agricultural producer, food manufacturer, or pesticide manufacturer.
Potentially affected entities may include, but are not limited to those
engaged in the following activities:
     Crop production (NAICS code 111).
     Animal production (NAICS code 112).
     Food manufacturing (NAICS code 311).
     Pesticide manufacturing (NAICS code 32532).
    This listing is not intended to be exhaustive, but rather to
provide a guide for readers regarding entities likely to be affected by
this action. Other types of entities not listed in this unit could also
be affected. The North American Industrial Classification System
(NAICS) codes have been provided to assist you and others in
determining whether this action might apply to certain entities. If you
have any questions regarding the applicability of this action to a
particular entity, consult the person listed under FOR FURTHER
INFORMATION CONTACT.

B. How Can I Access Electronic Copies of this Document?

    In addition to accessing electronically available documents at
http://www.regulations.gov, you may access this Federal Register
document electronically through the EPA Internet under the ``Federal
Register'' listings at http://www.epa.gov/fedrgstr. You may also access
a frequently updated electronic version of EPA's tolerance regulations
at 40 CFR part 180 through the Government Printing Office's e-CFR cite
at http://www.gpoaccess.gov/ecfr. To access the OPPTS Harmonized
Guidelines referenced in this document, go directly to the guidelines
at http://www.epa.gov/opptsfrs/home/guidelin.htm.

C. Can I File an Objection or Hearing Request?

    Under section 408(g) of FFDCA, 21 U.S.C. 346a, any person may file
an objection to any aspect of this regulation and may also request a
hearing on those objections. You must file your objection or request a
hearing on this regulation in accordance with the instructions provided
in 40 CFR part 178. To ensure proper receipt by EPA, you must identify
docket ID number EPA-HQ-OPP-2009-0490 in the subject line on the first
page of your submission. All requests must be in writing, and must be
mailed or delivered to the Hearing Clerk as required by 40 CFR part 178
on or before December 7, 2009.
    In addition to filing an objection or hearing request with the
Hearing Clerk as described in 40 CFR part 178, please submit a copy of
the filing that does not contain any CBI for inclusion in the public
docket that is described in ADDRESSES. Information not marked
confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA
without prior notice. Submit this copy, identified by docket ID number
EPA-HQ-OPP-2009-0490, by one of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov.
Follow the on-line instructions for submitting comments.
     Mail: Office of Pesticide Programs (OPP) Regulatory Public
Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania
Ave., NW., Washington, DC 20460-0001.
     Delivery: OPP Regulatory Public Docket (7502P),
Environmental Protection Agency, Rm. S-4400, One Potomac Yard (South
Bldg.), 2777 S. Crystal Dr., Arlington, VA. Deliveries are only
accepted during the Docket Facility's normal hours of operation (8:30
a.m. to 4 p.m., Monday through Friday, excluding legal holidays).
Special arrangements should be made for deliveries of boxed
information. The Docket Facility telephone number is<PHONE_NUMBER>.

II. Background

    In the Federal Register of August 19, 2009 (74 FR 41898) (FRL-8426-
7), EPA issued a notice pursuant to section 408(d)(3) of FFDCA, 21
U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP
9E7572) by The JITF, CST 11, c/o CropLife America, 1156 15th Street,
NW., Suite 400, Washington, DC 20005. The petition requested that 40
CFR 180.910 be amended by establishing exemptions from the requirement
of a tolerance for residues of SANFCs. That notice referenced a summary
of the petition prepared by the JITF, CST 11, the petitioner, which is
available to the public in the docket, http://www.regulations.gov.
Docket ID number EPA-HQ-OPP-2009-0043 was established for this
petition. There were no comments received in response to the notice of
filing.
    In the Federal Register of August 19, 2009 (74 FR 41895]) (FRL-
8429-9), EPA issued a notice pursuant to section 408(d)(3) of FFDCA, 21
U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP
9E7562) by Akzo Nobel Surface Chemistry, LLC, 525 West Van Buren
Street, Chicago, IL 60607-3823. The petition requested that 40 CFR
180.910 be amended by establishing exemptions from the requirement of a
tolerance for residues of mono-, di-, and trimethylnapthalenesulfonic
acids and napthalenesulfonic acids formaldehyde condensates, ammonium
and sodium salts. That notice referenced a summary of the petition
prepared by Akzo Nobel Surface Chemistry, LLC, the petitioner, which is
available to the public in the docket, http://www.regulations.gov.
Docket ID number EPA-HQ-OPP-2008-0822 was established for this
petition. There were no comments received in response to the notice of
filing.
    These two petitions are grouped because they fall under the same
general chemical description criteria.

 III. Inert Ingredient Definition

    Inert ingredients are all ingredients that are not active
ingredients as defined in 40 CFR 153.125 and include, but are not
limited to, the following types of ingredients (except when they have a
pesticidal efficacy of their own): Solvents such as alcohols and
hydrocarbons; surfactants such as polyoxyethylene polymers and fatty
acids; carriers such as clay and diatomaceous earth; thickeners such as
carrageenan and modified cellulose; wetting, spreading, and dispersing
agents; propellants in aerosol dispensers; microencapsulating agents;
and emulsifiers. The term ``inert'' is not intended to imply
nontoxicity; the ingredient may or may not be chemically active.
Generally, EPA has exempted inert ingredients from the requirement of a
tolerance based on the low toxicity of the individual inert
ingredients.

IV. Aggregate Risk Assessment and Determination of Safety

    Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish an
exemption from the requirement of a tolerance (the

legal limit for a pesticide chemical residue in or on a food) only if
EPA determines that the tolerance is ``safe.'' Section 408(b)(2)(A)(ii)
of FFDCA defines ``safe'' to mean that ``there is a reasonable
certainty that no harm will result from aggregate exposure to the
pesticide chemical residue, including all anticipated dietary exposures
and all other exposures for which there is reliable information.'' This
includes exposure through drinking water and in residential settings,
but does not include occupational exposure. Section 408(b)(2)(C) of
FFDCA requires EPA to give special consideration to exposure of infants
and children to the pesticide chemical residue in establishing a
tolerance and to ``ensure that there is a reasonable certainty that no
harm will result to infants and children from aggregate exposure to the
pesticide chemical residue. . . .''
    EPA performs a number of analyses to determine the risks from
aggregate exposure to pesticide residues. First, EPA determines the
toxicity of pesticides. Second, EPA examines exposure to the pesticide
through food, drinking water, and through other exposures that occur as
a result of pesticide use in residential settings.
    Consistent with section 408(b)(2)(D) of FFDCA, and the factors
specified in section 408(b)(2)(D) of FFDCA, EPA has reviewed the
available scientific data and other relevant information in support of
this action. EPA has sufficient data to assess the hazards of and to
make a determination on aggregate exposure for the petitioned-for
exemption from the requirement of a tolerance for residues of the
SANFCs when used as inert ingredients in pesticide formulations applied
pre-harvest and post-harvest. EPA's assessment of exposures and risks
associated with establishing tolerances follows.

 A. Toxicological Profile

    EPA has evaluated the available toxicity data and considered its
validity, completeness, and reliability as well as the relationship of
the results of the studies to human risk. EPA has also considered
available information concerning the variability of the sensitivities
of major identifiable subgroups of consumers, including infants and
children.
    The toxicology database for the SANFC inerts is adequate to support
their use as inert ingredients in pesticide formulations. The existing
toxicology database for the SANFC consists of two OPPTS Harmonized
Guidelines 870.3650 (combined repeated dose toxicity study with the
reproduction/developmental toxicity screening test in rats), and
several studies from the scientific literature on acute toxicity and
mutagenicity.
    The available toxicity data indicates that SANFC has low acute oral
and inhalation toxicity. SANFC was not mutagenic in an Ames test. In a
repeated 28 to 42 day OPPTS Harmonized Guideline 870.3650 combined
repeated dose toxicity study with the reproduction/developmental
toxicity screening with the representative test compound,
naphthalenesulfonic acid, sodium salt polymer with formaldehyde (CAS
9084-06-4), there was no evidence of increased susceptibility. Parental
toxicity manifested as decrements in body-weight gain in both sexes at
the limit dose (1,000 milligrams/kilogram/ day (mg/kg/day). No
developmental or reproductive effects were observed at doses of 100,
300, and 1,000 mg/kg/day. In an OPPTS Harmonized Guideline 870.3650
study submitted by Akzo Nobel Chemistry, LLC, no systemic toxicity was
observed at doses up to and including 456 mg/kg/day. The highest dose
tested (HDT). There was no evidence of potential neurotoxicity or
immunotoxicity in the adult animal in the OPPTS Harmonized Guideline
870.3650 study at the limit dose of 1,000 mg/kg/day. There is no
evidence that the SANFCs are carcinogenic. There are no chronic data
available on the SANFC surfactants; however, no structural alerts for
cancer were identified in a qualitative structure activity relationship
(SAR) database, DEREK Version 11. In addition, there was little concern
about any of the postulated metabolites having greater toxicity than
the parent compounds. The higher molecular weight (MW) polymeric SANFC
surfactants (MW >1,000) are not expected to be readily absorbed or
metabolized, and should thus be rapidly excreted (likely in the feces)
unchanged. Additionally, lower molecular microsome cytochrome P-450
oxygenases may hydroxylate the naphthalene ring and/or methylene bridge
to produce alternative metabolites that should also be readily
conjugated and excreted. Furthermore, these compounds are formaldehyde
condensates and do not contain free formaldehyde. Therefore,
formaldehyde is not a residue of concern. In summary, all available
data indicate that SANFCs have a low hazard potential.
    Specific information on the studies received are included in the
Agency's Human Health Risk Assessment which can be found at http://
www.regulations.gov in document Sodium and Ammonium
Naphthalenesulfonate Formaldehyde Condensates (SANFCs) - JITF CST 11
Inert Ingredients), Human Health Risk Assessment to Support Proposed
Exemption from the Requirement of a Tolerance When Used as Inert
Ingredients in Pesticide Formulations, pages 6-8 and 11-14 in docket ID
number EPA-HQ-OPP-2009-0043 and also in document Mono-, Di-, and
Trimethylnapthalensulfonic Acids and Naphthalenesulfonic Acids
Formaldehyde Condensates, Ammonium and Sodium Salts: Review of
Toxicological Studies in Support of an Exemption from the Requirement
of a Tolerance (40 CFR 180.920 and 40 CFR 180.910) When Used as Inert
Ingredients in Pesticide Formulations in docket ID number EPA-HQ-OPP-
2008-0822.

B. Toxicity Endpoint Selection and FQPA Considerations

    There was no significant hazard identified in the OPPTS Harmonized
Guideline 870.3650 study at the limit dose of 1,000 mg/kg/day to either
parental animals or their offspring. Thus, due to their low potential
hazard and the lack of a hazard endpoint, it was determined that a
quantitative risk assessment using safety factors applied to a point of
departure protective of an identified hazard endpoint is not
appropriate for the SANFCs. The Agency notes that there was no evidence
of neurotoxicity or increased susceptibility to the offspring of rats
following prenatal or postnatal exposure in the OPPTS Harmonized
Guideline 870.3650 studies. Based on this information, there is no
concern, at this time, for increased sensitivity to infants and
children to the SANFCs when used as inert ingredients in pesticide
formulations applied pre-harvest and post-harvest and a safety factor
analysis has not been used to assess risk. For the same reason, EPA has
determined that an additional safety factor is not needed to protect
the safety of infants and children.

C. Aggregate Exposures

     In examining aggregate exposure, section 408 of FFDCA directs EPA
to consider available information concerning exposures from the
pesticide residue in food and all other non-occupational exposures,
including drinking water from ground water or surface water and
exposure through pesticide use in gardens, lawns, or buildings
(residential and other indoor uses).
    The SANFC inerts are used as disperants, defoamers and emulsifiers
in pesticide formulations. These surfactants have a wide range of

industrial uses as well as serving as emulsifiers in personal care
products and in food contact packaging.
    The residues of concern are the parent compound only. Considering
the large size and polarity of the SANFC molecules, it is unlikely that
they would be readily absorbed by livestock or taken up by plants for
further metabolism.
    No hazard was identified for the acute and chronic dietary
assessment (food and drinking water), or for the short-term,
intermediate-term, and long-term residential assessments, and
therefore, no quantitative aggregate exposure assessments were
performed.

D. Cumulative Effects From Substances With a Common Mechanism of
Toxicity

     Section 408(b)(2)(D)(v) of FFDCA requires that, when considering
whether to establish, modify, or revoke a tolerance, the Agency
consider ``available information'' concerning the cumulative effects of
a particular pesticide's residues and ``other substances that have a
common mechanism of toxicity.''
    EPA has not found the SANFCs to share a common mechanism of
toxicity with any other substances, and SANFCs do not appear to produce
a toxic metabolite produced by other substances. For the purposes of
this tolerance action, therefore, EPA has assumed that SANFCs do not
have a common mechanism of toxicity with other substances. For
information regarding EPA's efforts to determine which chemicals have a
common mechanism of toxicity and to evaluate the cumulative effects of
such chemicals, see EPA's website at http://www.epa.gov/pesticides/
cumulative.

E. Determination of safety

    Based on all available information, EPA concludes that there is a
reasonable certainty that no harm will result to the general population
or to infants and children from aggregate exposure to residues of the
SANFCs when used as inert ingredients in pesticide formulations applied
pre-harvest and post-harvest.

V. Other Considerations

A. Analytical Enforcement Methodology

     An analytical method is not required for enforcement purposes
since the Agency is establishing an exemption from the requirement of a
tolerance without any numerical limitation.

B. Existing Exemptions

    The SANFCs have an existing exemption from the requirement of a
tolerance under 40 CFR 180.920 for use as inert ingredients in
pesticide formulations applied to growing crops.

C. International Residue Limits

    The Agency is not aware of any country requiring a tolerance for
the SANFCs nor have any CODEX Maximum Residue Levels been established
for any food crops at this time.

VI. Conclusion

    Therefore, an exemption from the requirement of a tolerance is
established for residues of the SANFCs, under the tolerance expression
mono-, di-, and trimethylnapthalenesulfonic acids and
napthalenesulfonic acids formaldehyde condensates, ammonium and sodium
salts, when used as inert ingredients in pesticide formulations applied
pre-harvest and post-harvest.

VII. Statutory and Executive Order Reviews

    This final rule establishes tolerances under section 408(d) of
FFDCA in response to a petition submitted to the Agency. The Office of
Management and Budget (OMB) has exempted these types of actions from
review under Executive Order 12866, entitled Regulatory Planning and
Review (58 FR 51735, October 4, 1993). Because this final rule has been
exempted from review under Executive Order 12866, this final rule is
not subject to Executive Order 13211, entitled Actions Concerning
Regulations That Significantly Affect Energy Supply, Distribution, or
Use (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled
Protection of Children from Environmental Health Risks and Safety Risks
(62 FR 19885, April 23, 1997). This final rule does not contain any
information collections subject to OMB approval under the Paperwork
Reduction Act (PRA), 44 U.S.C. 3501 et seq., nor does it require any
special considerations under Executive Order 12898, entitled Federal
Actions to Address Environmental Justice in Minority Populations and
Low-Income Populations (59 FR 7629, February 16, 1994).
    Since tolerances and exemptions that are established on the basis
of a petition under section 408(d) of FFDCA, such as the exemption in
this final rule, do not require the issuance of a proposed rule, the
requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et
seq.) do not apply.
    This final rule directly regulates growers, food processors, food
handlers, and food retailers, not States or tribes, nor does this
action alter the relationships or distribution of power and
responsibilities established by Congress in the preemption provisions
of section 408(n)(4) of FFDCA. As such, the Agency has determined that
this action will not have a substantial direct effect on States or
tribal governments, on the relationship between the national government
and the States or tribal governments, or on the distribution of power
and responsibilities among the various levels of government or between
the Federal Government and Indian tribes. Thus, the Agency has
determined that Executive Order 13132, entitled Federalism (64 FR
43255, August 10, 1999) and Executive Order 13175, entitled
Consultation and Coordination with Indian Tribal Governments (65 FR
67249, November 9, 2000) do not apply to this final rule. In addition,
this final rule does not impose any enforceable duty or contain any
unfunded mandate as described under Title II of the Unfunded Mandates
Reform Act of 1995 (UMRA) (Public Law 104-4).
    This action does not involve any technical standards that would
require Agency consideration of voluntary consensus standards pursuant
to section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272
note).

VIII. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report to each House of the Congress and to
the Comptroller General of the United States. EPA will submit a report
containing this rule and other required information to the U.S. Senate,
the U.S. House of Representatives, and the Comptroller General of the
United States prior to publication of this final rule in the Federal
Register. This final rule is not a ``major rule'' as defined by 5
U.S.C. 804(2).

List of Subjects in 40 CFR Part 180

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

    Dated: September 30, 2009.
G. Jeffrey Herndon,
Acting Director, Registration Division, Office of Pesticide Programs.

0
Therefore, 40 CFR chapter I is amended as follows:

PART 180--[AMENDED]

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

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

0
2. In Sec. 180.910, the table is amended by adding alphabetically the
following inert ingredients to read as follows:

Sec.  180.910  Inert ingredients used pre- and post-harvest; exemptions
from the requirement of a tolerance.

* * * * *

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        Inert Ingredients               Limits               Uses
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                              * * * * * * *
Mono-, di-, and                                       Surfactants,
 trimethylnapthalenesulfonic                           related adjuvants
 acids and napthalenesulfonic                          of surfactants
 acids formaldehyde condensates,
 ammonium and sodium salts (CAS
 Reg. Nos 9008-63-3, 9069-80-1,
 9084-06-4, 36290-04-7, 91078-68-
 1, 141959-43-5, 68425-94-5)
                              * * * * * * *
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[FR Doc. E9-24160 Filed 10-6-09; 8:45 am]

BILLING CODE 6560-50-S


[Federal Register Volume 86, Number 56 (Thursday, March 25, 2021)]
[Notices]
[Pages 16003-16005]
[FR Doc No: 2021-06124]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91373; File No. SR-FINRA-2021-004]

Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Extend the Pilot Program Related to FINRA Rule
11892 (Clearly Erroneous Transactions in Exchange-Listed Securities)

March 19, 2021.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 15, 2021, the Financial Industry Regulatory Authority, Inc.
(``FINRA'') filed with the Securities and Exchange Commission (``SEC''
or ``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by FINRA. FINRA has designated
the proposed rule change as constituting a ``non-controversial'' rule
change under paragraph (f)(6) of Rule 19b-4 under the Act,\3\ which
renders the proposal effective upon receipt of this filing by the
Commission. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    FINRA is proposing to extend the current pilot program related to
FINRA Rule 11892 (Clearly Erroneous Transactions in Exchange-Listed
Securities) (``Clearly Erroneous Transaction Pilot'' or ``Pilot'')
until October 20, 2021.
    The text of the proposed rule change is available on FINRA's
website at http://www.finra.org, at the principal office of FINRA 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, FINRA 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. FINRA has prepared summaries, set forth in sections A,
B, and C below, of the most significant aspects of such statements.

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

1. Purpose
    FINRA is proposing a rule change to extend the current pilot
program related to FINRA Rule 11892 governing clearly erroneous
transactions in exchange-listed securities until the close of business
on October 20, 2021. Extending the Pilot would provide FINRA and the
national securities exchanges additional time to consider a permanent
proposal for clearly erroneous transaction reviews.
    On September 10, 2010, the Commission approved, on a pilot basis,
changes to FINRA Rule 11892 that, among other things: (i) Provided for
uniform treatment of clearly erroneous transaction reviews in multi-
stock events involving twenty or more securities; and (ii) reduced the
ability of FINRA to deviate from the objective standards set forth in
the rule.\4\ In 2013, FINRA adopted a provision designed to address the
operation of the Plan to Address Extraordinary Market Volatility
Pursuant to Rule 608 of Regulation NMS (``Plan'').\5\ Finally, in 2014,
FINRA adopted two additional provisions addressing (i) erroneous
transactions that occur over one or more trading days that were based
on the same fundamentally incorrect or grossly misinterpreted
information resulting in a severe valuation error; and (ii) a
disruption or malfunction in the operation of the facilities of a self-
regulatory organization or responsible single plan processor in
connection with the transmittal or receipt of a trading halt.\6\
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    \4\ See Securities Exchange Act Release No. 62885 (September 10,
2010), 75 FR 56641 (September 16, 2010) (Order Approving File No.
SR-FINRA-2010-032).
    \5\ See Securities Exchange Act Release No. 68808 (February 1,
2013), 78 FR 9083 (February 7, 2013) (Notice of Filing and Immediate
Effectiveness of File No. SR-FINRA-2013-012).
    \6\ See Securities Exchange Act Release No. 72434 (June 19,
2014), 79 FR 36110 (June 25, 2014) (Order Approving File No. SR-
FINRA-2014-021).
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    On April 9, 2019, FINRA filed a proposed rule change to untie the
effectiveness of the Clearly Erroneous Transaction Pilot from the
effectiveness of the Plan, and to extend the Pilot's effectiveness to
the close of business on October 18, 2019.\7\ On October 18, 2019,

FINRA filed a proposed rule change to extend the Pilot's effectiveness
until April 20, 2020.\8\ On March 27, 2020, FINRA filed a proposed rule
change to extend the pilot's effectiveness until October 20, 2020.\9\
On October 16, 2020, FINRA filed a proposed rule change to extend the
Pilot's effectiveness until April 20, 2021.\10\ FINRA now is proposing
to further extend the Pilot until October 20, 2021, so that market
participants can continue to benefit from the more objective clearly
erroneous transaction standards under the Pilot.\11\ Extending the
Pilot also would provide more time to permit FINRA and the other self-
regulatory organizations to consider what changes, if any, to the
clearly erroneous transaction rules are appropriate.\12\
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    \7\ See Securities Exchange Act Release No. 85612 (April 11,
2019), 84 FR 16107 (April 17, 2019) (Notice of Filing and Immediate
Effectiveness of File No. SR-FINRA-2019-011).
    \8\ See Securities Exchange Act Release No. 87344 (October 18,
2019), 84 FR 57076 (October 24, 2019) (Notice of Filing and
Immediate Effectiveness of File No. SR-FINRA-2019-025).
    \9\ See Securities Exchange Act Release No. 88495 (March 27,
2020), 85 FR 18608 (April 2, 2020) (Notice of Filing and Immediate
Effectiveness of File No. SR-FINRA-2020-008).
    \10\ See Securities Exchange Act Release No. 90219 (October 19,
2020), 85 FR 67574 (October 23, 2020) (Notice of Filing and
Immediate Effectiveness of File No. SR-FINRA-2020-036).
    \11\ If the pilot period is not either extended or approved as
permanent, the version of Rule 11892 prior to SR-FINRA-2010-032
shall be in effect, and the amendments set forth in SR-FINRA-2014-
021 and the provisions of Supplementary Material .03 of the rule
shall be null and void.
    \12\ See Securities Exchange Act Release No. 85623 (April 11,
2019), 84 FR 16086 (April 17, 2019) (Order Approving the Eighteenth
Amendment to the National Market System Plan to Address
Extraordinary Market Volatility).
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    FINRA has filed the proposed rule change for immediate
effectiveness. The operative date for the amendments will be 30 days
from the date of filing.
2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(6) of the Act,\13\ which requires, among
other things, that FINRA rules must be designed to prevent fraudulent
and manipulative acts and practices, to promote just and equitable
principles of trade and, in general, to protect investors and the
public interest. FINRA believes that the proposed rule change promotes
just and equitable principles of trade in that it promotes transparency
and uniformity across markets concerning the review of transactions as
clearly erroneous. FINRA believes that extending the Pilot under FINRA
Rule 11892, until October 20, 2021, would help assure consistent
results in handling erroneous trades across the U.S. equities markets,
thus furthering fair and orderly markets, the protection of investors
and the public interest. Based on the foregoing, FINRA believes the
Clearly Erroneous Transaction Pilot should continue to be in effect
while FINRA and the national securities exchanges consider a permanent
proposal for clearly erroneous transaction reviews.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78o-3(b)(6).
---------------------------------------------------------------------------

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

    FINRA does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The proposal would ensure the
continued, uninterrupted operation of harmonized clearly erroneous
transaction rules across the U.S. equities markets while FINRA and the
national securities exchanges consider further amendments to these
rules. FINRA understands that the national securities exchanges also
will file similar proposals to extend their clearly erroneous execution
pilot programs, as applicable. Thus, the proposed rule change will help
to ensure consistency across market centers without implicating any
competitive issues.

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

    Written comments were neither solicited nor received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \14\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\15\
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \15\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give 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 of filing of the proposed
rule change, or such shorter time as designated by the Commission.
FINRA has satisfied this requirement.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.

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-FINRA-2021-004 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-FINRA-2021-004. 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 such filing also will be available for inspection
and copying at the principal office of FINRA. 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-FINRA-

2021-004 and should be submitted on or before April 15, 2021.
---------------------------------------------------------------------------

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

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2021-06124 Filed 3-24-21; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 88, Number 95 (Wednesday, May 17, 2023)]
[Notices]
[Pages 31539-31543]
[FR Doc No: 2023-10465]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-97480; File No. SR-CboeBZX-2023-030]

Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
Its Fee Schedule

May 11, 2023.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 28, 2023, Cboe BZX Exchange, Inc. (``Exchange'' or ``BZX'')
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 prepared by the Exchange. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
---------------------------------------------------------------------------

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

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

    Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX Options'')
proposes to amend its Fee Schedule. The text of the proposed rule
change is provided in Exhibit 5.
    The text of the proposed rule change is also available on the
Exchange's website (http://markets.cboe.com/us/equities/regulation/rule_filings/bzx/), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

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

1. Purpose
    The Exchange proposes to amend its fees Fee Schedule to modify its
market data fees for BZX Options Top.\3\ Particularly, the Exchange
proposes to modify the Professional and Non-Professional User Fees,
modify the Enterprise Fee for BXZ Options Top and make other
clarifying, non-substantive changes.\4\
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    \3\ BZX Options Top is an uncompressed data feed that offers top
of book quotations and execution information based on options orders
entered into the System. Uncompressed data is disseminated ``as is''
in the native format by the Exchange, with no compression.
    \4\ The Exchange initially filed the proposed fee changes on
January 3, 2023 (SR-CboeBZX-2023-001). On March 1, 2023, the
Exchange withdrew that filing and submitted SR-CboeBZX-2023-016,
which was filed on February 28, 2023. On April 28, 2023, the
Exchange withdrew that filing and submitted this filing.
---------------------------------------------------------------------------

    The Exchange first proposes to reduce the rates for Professional
and Non-Professional User fees for BZX Options Top. The Exchange
currently charges Internal Distributors and External Distributors that
redistribute any of the BZX Options Data Feeds different fees for their
Professional Users \5\ and Non-Professional Users.\6\ The Exchange

currently assesses a monthly fee for Professional Users of $30.00 per
User and a monthly fee of $1.00 per Non-Professional User.\7\ One User
fee allows access to the BZX Options Top Feed and the BZX Options Depth
Feed.\8\ The Exchange proposes to reduce the rates for the User fees
for BZX Options Top. Particularly, the Exchange proposes to reduce the
monthly (i) Professional User fee from $30 per user to $5 per user and
(ii) Non-Professional User fee from $1.00 per user to $0.10 per user.
The Exchange also proposes to start charging separate User fees for BZX
Options Top and BZX Options Depth Feed. The Exchange therefore proposes
to eliminate the language under the BZX Options Top table and BZX
Options Depth Feed table that states one User fee allows access to the
BZX Options Top Feed and the BZX Options Depth Feed.\9\
---------------------------------------------------------------------------

    \5\ A Professional User of an Exchange Market Data product is
any User other than a Non-Professional User.
    \6\ A ``Non-Professional User'' of an Exchange Market Data
product is a natural person or qualifying trust that uses Data only
for personal purposes and not for any commercial purpose and, for a
natural person who works in the United States, is not: (i)
registered or qualified in any capacity with the Securities and
Exchange Commission, the Commodities Futures Trading Commission, any
state securities agency, any securities exchange or association, or
any commodities or futures contract market or association; (ii)
engaged as an ``investment adviser'' as that term is defined in
section 202(a)(11) of the Investment Advisors Act of 1940 (whether
or not registered or qualified under that Act); or (iii) employed by
a bank or other organization exempt from registration under federal
or state securities laws to perform functions that would require
registration or qualification if such functions were performed for
an organization not so exempt; or, for a natural person who works
outside of the United States, does not perform the same functions as
would disqualify such person as a Non-Professional User if he or she
worked in the United States.
    \7\ Distributors that receive BZX Options Data are required to
count every Professional User and Non-Professional User to which
they provide the data feed(s).
    \8\ BZX Options Depth is an uncompressed data feed that offers
depth of book quotations and execution information based on options
orders entered into the System.
    \9\ The Exchange is not proposing any changes to the current
User Fee amounts for BZX Options Depth Feed at this time.
---------------------------------------------------------------------------

    The Exchange next proposes to increase the current monthly
Enterprise Fee. The Enterprise Fee permits a recipient firm (i.e., a
Distributor) to purchase a monthly (and optional) Enterprise license to
receive the BZX Options Top Feed for distribution to an unlimited
number of Professional and Non-Professional Users.\10\ The Enterprise
Fee is an alternative to Professional and Non-Professional User fees.
Like User fees, it is also assessed in addition to the Distribution
Fee.\11\ Currently, the Exchange assesses an Enterprise Fee of $3,500
per month for BZX Options Top Feed.\12\ The Exchange proposes to
increase the Enterprise Fee to $20,000 per month. For example, if a
Distributor distributes BZX Options Top to 15,000 Professional Users
who each receive BZX Options Top at $5.00 per month (as proposed), then
that Distributor will pay $75,000 per month in Professional Users fees.
Under the proposed Enterprise Fee, it will pay a flat fee of $20,000
for an unlimited number of Professional and Non-Professional Users. A
Distributor must pay a separate Enterprise Fee for each entity that
controls the display of BZX Options Top if it wishes for such User to
be covered by the Enterprise Fee rather than by per User fees.\13\ A
Distributor that pays the Enterprise Fee will not have to report its
number of such Users on a monthly basis. However, every six months, it
must provide the Exchange with a count of the total number of
Professional and Non-Professional Users of BZX Options Top.\14\
---------------------------------------------------------------------------

    \10\ The Exchange proposes to amend the description relating to
the Enterprise Fees under the BZX Options Top and Depth fee tables
to clarify that Distributors are the market participant that would
be purchasing the monthly Enterprise license for purposes of
distribution to Professional and Non-Professional Users.
    \11\ The Exchange also proposes to clarify in the descriptions
relating to the Enterprise Fees that (i) it is an alternative to
``Professional and Non-Professional'' User fees and (ii) is in
addition to the Distribution Fee, to make clear what fees apply.
    \12\ The Exchange also offers a separate Enterprise license for
the BZX Options Depth Feed, also priced at $3,500 per month. If a
Distributor wishes to purchase an Enterprise license for each of BZX
Options Top Feed and BZX Options Depth Feed, it would be subject to
a total of $7,000 per month ($3,500 for each Enterprise license). To
date, no market participant has purchased an Enterprise license for
either feed.
    \13\ For example, if a Distributor (e.g., Refinitiv) that
distributes BZX Options Top to Retail Brokerage Firm A and Retail
Brokerage Firm B (which ``entities'' redistribute BZX Options Top to
its respective Users) and wishes to have the Users under each entity
covered by an Enterprise license, the Distributor would be subject
to two Enterprise Fees.
    \14\ See Cboe Global Markets north American Data Policies.
---------------------------------------------------------------------------

    The Exchange lastly proposes to make clarifying, non-substantive
changes. First, the Exchange proposes to add references to ``Depth'' in
the description of the Distribution Fees and Enterprise Fee under the
BZX Options Depth Feed table to clarify which data feed such fees
currently applies to, thereby alleviating potential confusion. The
Exchange also proposes to replace references to ``Recipient firm'' with
``Distributors'' to more accurately reflect the type of market
participants the fees are applicable to, thereby alleviating potential
confusion. The Exchange lastly proposes to add a reference to
``Professional and Non-Professional'' Users in the description of the
BZX Options Depth Enterprise Fee.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of section 6(b) of the Act.\15\ Specifically, the
Exchange believes the proposed rule change is consistent with the
section 6(b)(5) \16\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with the
section 6(b)(5) requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers. The Exchange also believes this proposal is
consistent with section 6(b)(8) of the Act, which requires that the
rules of an exchange not impose any burden on competition that is not
necessary or appropriate in furtherance of the purposes of the Act.\17\
In addition, the Exchange believes that the proposed rule change is
consistent with section 11(A) of the Act as it supports (i) fair
competition among brokers and dealers, among exchange markets, and
between exchange markets and markets other than exchange markets, and
(ii) the availability to brokers, dealers, and investors of information
with respect to quotations for and transactions in securities.\18\ The
Exchange also believes the proposed rule change is consistent with
section 6(b)(4) of the Act,\19\ which requires that Exchange rules
provide for the equitable allocation of reasonable dues, fees, and
other charges among its Members and other persons using its facilities.
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78f(b).
    \16\ 15 U.S.C. 78f(b)(5).
    \17\ 15 U.S.C. 78f(b)(8).
    \18\ 15 U.S.C. 78k-1.
    \19\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    The Exchange first notes that it operates in a highly competitive
environment. Indeed, there are currently 16 registered options
exchanges that trade options. Based on publicly available information,
no single options exchange has more than 18% of the market share.\20\
The Exchange believes top-of-book quotation and transaction data is
highly competitive as national securities exchanges compete vigorously

with each other to provide efficient, reliable, and low-cost data to a
wide range of investors and market participants. Indeed, there are
several competing products offered by other national securities
exchanges today, not counting products offered by the Exchange's
affiliates, and each of the Exchange's affiliated U.S. options
exchanges also offers similar top-of-book data.\21\ Each of those
exchanges offer top-of-book quotation and last sale information based
on their own quotation and trading activity that is substantially
similar to the information provided by the Exchange through the BZX
Options Top Feed. Further, the quote and last sale data contained in
the BZX Options Top Feed is identical to the data sent to OPRA for
redistribution to the public.\22\ Accordingly, Exchange top-of-book
data is widely available today from a number of different sources.
---------------------------------------------------------------------------

    \20\ See Cboe Global Markets U.S. Options Market Month-to-Date
Volume Summary (April 24, 2023), available at https://markets.cboe.com/us/options/market_statistics/.
    \21\ See e.g., NYSE Arca Options Proprietary Market Data Fees
Schedule, MIAX Options Exchange, Fee Schedule, Section 6 (Market
Data Fees), Nasdaq PHLX Options 7 Pricing Schedule, Section 10
(Proprietary Data Feed Fees) and Cboe Data Services, LLC Fees
Schedule.
    \22\ The Exchange notes that it makes available the top-of-book
and last sale data that is included in the BZX Options Top Data Feed
no earlier than the time at which the Exchange sends that data to
OPRA.
---------------------------------------------------------------------------

    Moreover, the BZX Options Top is distributed and purchased on a
voluntary basis, in that neither the Exchange nor market data
distributors are required by any rule or regulation to make this data
available. Accordingly, Distributors and Users can discontinue use at
any time and for any reason, including due to an assessment of the
reasonableness of fees charged. As described above, market participants
have a wide variety of alternative market data products from which to
choose, such as similar proprietary data products offered by other
exchanges and consolidated data. Further, the Exchange is not required
to make any proprietary data products available or to offer any
specific pricing alternatives to any customers. Moreover, persons
(including broker-dealers) who subscribe to any exchange proprietary
data feed must also have equivalent access to consolidated Options
Information \23\ from OPRA for the same classes or series of options
that are included in the proprietary data feed, and proprietary data
feeds cannot be used to meet that particular requirement.\24\ As such,
all proprietary data feeds are purely optional and only those that deem
the product to be of sufficient overall value and usefulness would
purchase it.
---------------------------------------------------------------------------

    \23\ ``Consolidated Options Information'' means consolidated
Last Sale Reports combined with either consolidated Quotation
Information or the BBO furnished by OPRA. Access to consolidated
Options Information is deemed ``equivalent'' if both kinds of
information are equally accessible on the same terminal or work
station. See Limited Liability Company Agreement of Options Price
Reporting Authority, LLC (``OPRA Plan''), Section 5.2(c)(iii). The
Exchange notes that this requirement under the OPRA Plan is also
reiterated under the Cboe Global Markets Global Data Agreement and
Cboe Global Markets North American Data Policies, which subscribers
to any exchange proprietary product must sign and are subject to,
respectively. Additionally, the Exchange's Data Order Form (used for
requesting the Exchange's market data products) requires
confirmation that the requesting market participant receives data
from OPRA.
    \24\ Id.
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    The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. Particularly, in
Regulation NMS, the Commission highlighted the importance of market
forces in determining prices and SRO revenues and, also, recognized
that current regulation of the market system ``has been remarkably
successful in promoting market competition in its broader forms that
are most important to investors and listed companies.'' \25\ Making
similar data products available to market participants fosters
competition in the marketplace, and constrains the ability of exchanges
to charge supracompetitive fees. In the event that a market participant
views one exchange's data product as more or less attractive than the
competition they can and do switch between similar products. The
proposed fees are a result of the competitive environment, as the
Exchange seeks to adopt fees to attract purchasers who may be
interested in purchasing only the BZX Options Top Data Feed.
---------------------------------------------------------------------------

    \25\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
---------------------------------------------------------------------------

    The Exchange believes the proposed changes to reduce the rates of
the current Professional and Non-Professional User fees for BZX Options
Top Data are reasonable as Distributors will be subject to lower User
fees for the BZX Options Top Feed. Distributors who only wish to
distribute BZX Options Top Feed will therefore be subject to lower User
fees. Additionally, the User fees continue to be in line with and/or
lower than User fees assessed by other exchanges for similar data.\26\
---------------------------------------------------------------------------

    \26\ See e.g., Nasdaq PHLX Options 7 Pricing Schedule, Section
10 (Proprietary Data Feed Fees), which provides for a fee of $40 per
month to professional users and $1.00 per month to non-professional
users to cover the usage of PHLX Options (TOPO) Data, TOPO Plus
Orders, PHLX Orders and PHLX Depth Data feeds. See also NYSE
American Options Proprietary Market Data Fees schedule, which
provides for a fee of $50 per month to professional users and $1.00
per month to non-professional users of American Options Top Data,
American Options Deep and American Options Complex products. By
comparison, the total combined Professional User fee for the
Exchange's market data products is still lower at $35 per
Professional User (i.e., $5 per Professional Users of BZX Options
Top, as proposed, and $30 per Professional User of BZX Options
Depth). The Exchange's combined Non-Professional User Fee at $1.10
per Non-Professional User (i.e., $0.10 per Non-Professional User of
BZX Options Top, as proposed, and $1 per Non-Professional User of
BZX Options Depth) is still in line with, and not a significant
departure from, PHLX's and NYSE American's aforementioned Non-
Professional User fees.
---------------------------------------------------------------------------

    The Exchange believes that the proposed fees are equitable and not
unfairly discriminatory because they will be charged uniformly to
Distributors who distribute BZX Options Top. The Exchange also believes
continuing to offer BZX Options Top Data to Non-Professional Users at a
lower cost than Professional Users results in greater equity among data
recipients, as Professional Users are categorized as such based on
their employment and participation in financial markets, and thus, are
compensated to participate in the markets. Although Non-Professional
Users too can receive significant financial benefits through their
participation in the markets, the Exchange believes it is reasonable to
charge more to those Users who are more directly engaged in the
markets. The Exchange believes assessing lower User fees for BZX
Options Top as compared to BZX Options Depth is also equitably and not
unfairly discriminatory. Particularly, the BZX Options Top Feed
contains less information than BZX Options Depth (indeed, the
information contained in BZX Options Top is a subset of the information
that is included in BZX Options Depth). The Exchange believes it is
equitable to have pricing based, in part, upon the amount of
information contained in each data feed and the value of that
information to market participants. Thus, the Exchange believes it's
reasonable for BZX Options Top to have lower User fees than BZX Options
Depth because it offers less data than BZX Options Depth.
    The Exchange next notes it is not required to charge a single User
fee to cover all its available data products, but none-the-less has not
charged separate User Fees for both BZX Options Top and BZX Options
Depth since BZX Options Top was adopted in March 2018.\27\ However, the
Exchange no longer wishes to continue to have a single fee. The
Exchange believes the

proposed change is reasonable, equitable and not unfairly
discriminatory as the Top and Book Depth Data Feeds are purely
optional. As stated above, the Exchange also believes charging separate
User fees is equitable as it allows the Exchange to assess prices based
on the amount of information contained in each feed, which can provide
an opportunity to assess lower fees for products that contain less
information. Particularly, the proposed rule change reduces fees for
market participants who only want top-of-book and execution data and do
not need depth-of-book data. Those who wish to receive more
comprehensive depth-of-book information may still continue to do so at
the current (and higher) price. Additionally, as noted above, the data
contained in the BZX Options Top Feed is a subset of the data included
in the BZX Options Depth Feed. As such, a User that receives BZX
Options Depth Feed would not need to also receive the BZX Options Top
Feed since the BZX Options Depth Feed is already inclusive of the data
contained in the BZX Options Top Feed. Moreover, only those
Distributors that deem the products to be of sufficient overall value
and usefulness would purchase either or both of them for purposes of
distribution to Users. Distributors are not required to distribute, and
Users are not required to receive, any one particular data product and
indeed may choose to receive none, one, or several of the Exchange's
market data products. Additionally, the Exchange is not required to
provide any fee waiver to Distributors of BZX Options Top, including
for User Fees. In fact, another exchange similarly adopted separate
fees for different data products that historically had otherwise been
provided under a single fee.\28\ The Exchange believes the proposed
change is equitable and not unfairly discriminatory as it will apply
uniformly to Distributors.
---------------------------------------------------------------------------

    \27\ See Securities Exchange Act Release No. 82874 (March 14,
2018), 83 FR 12210 (March 20, 2018) (SR-CboeBZX-2018-017).
    \28\ See Securities Exchange Act Release No. 79556 (December 14,
2016), 81 FR 92935 (December 20, 2016) (SR-NASDAQ-2016-167).
---------------------------------------------------------------------------

    The proposed increased Enterprise Fee for BZX Options Top Feed is
equitable and reasonable as the proposed fee could still result in a
fee reduction for Distributors with a large number of Professional and
Non-Professional Users. If a Distributor has a smaller number of
Professional Users of BZX Options Top, then it may continue using the
per User structure and benefit from the proposed per BZX Options Top
User Fee reductions. By reducing prices Distributors with a large
number of Professional and Non-Professional Users, the Exchange
believes that more firms may choose to receive and to distribute BZX
Options Top Data, thereby expanding the distribution of this market
data for the benefit of investors. The Exchange notes that currently no
Distributors have purchased an Enterprise license. The Exchange
believes however, that the proposed lower User fees for BZX Options Top
may incentivize additional External Distributors to distribute BZX
Options Top an enlist additional Users. As a Distributor's User base
grows, it may make sense for a Distributor to purchase the alternative
Enterprise license to cap its fees. In connection with this potential
increase in Users, the Exchange believes it is therefore also
reasonable to increase the current amount of the Enterprise Fee. That
said, the Enterprise Fee is entirely optional. A firm that does not
have a sufficient number of Users to benefit from the purchase of the
Enterprise license need not do so.
    The Exchange further believes that the Enterprise Fee, even as
amended, is reasonable because it simplifies reporting for certain
Distributors that have large numbers of Professional and Non-
Professional Users. Firms that pay the proposed Enterprise Fee do have
to report the number of Users on a monthly basis as they currently do,
but rather only have to count authorized users every six months, which
is a significant reduction in administrative burden.
    The Exchange lastly believes the proposed non-substantive
clarifying changes will alleviate potential confusion, thereby removing
impediments to and perfecting the mechanism of a free and open market
and a national market system, and, in general, protecting investors and
the public interest.

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

    The Exchange does not believe that the proposed rule change would
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The Exchange
operates in a highly competitive environment, and its ability to price
top-of-book data is constrained by competition among exchanges that
offer similar data products to their customers. For example, Top-of-
book data is broadly disseminated by competing U.S. options exchanges.
In this competitive environment potential Distributors are free to
choose which competing product to purchase to satisfy their need for
market information. Often, the choice comes down to price, as market
data customers look to purchase cheaper data products, and quality, as
market participants seek to purchase data that represents significant
market liquidity.
    The Exchange believes that the proposed fees do not put any market
participants at a relative disadvantage compared to other market
participants. As discussed, the proposed fees would apply to all
similarly situated Distributors of BZX Options Top on an equal and non-
discriminatory basis. The Exchange believes the differentiated fees for
Professional and Non-Professional Users of BZX Options Top is
appropriate given Professional Users are categorized as such based on
their employment and participation in financial markets, and thus, are
compensated to participate in the markets. Non-Professional Users too
can receive significant financial benefits through their participation
in the markets, however the Exchange believes it is reasonable to
charge more for those Users who are more directly engaged in the
markets. The Exchange therefore believes that the proposed fee neither
favors nor penalizes one or more categories of market participants in a
manner that would impose an undue burden on competition.
    The Exchange believes that the proposed fees do not impose a burden
on competition or on other SROs that is not necessary or appropriate in
furtherance of the purposes of the Act. In particular, market
participants are not forced to subscribe to BZX Options Top, or any of
the Exchange's data feeds, as described above. Also as described above,
there are numerous substitute products offered by other national
securities exchanges, as well as OPRA. Because market data customers
can find suitable substitute feeds, an exchange that overprices its
market data products stands a high risk that users may substitute
another product. These competitive pressures ensure that no one
exchange's market data fees can impose an undue burden on competition,
and the Exchange's proposed fees do not do so here.

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

    The Exchange neither solicited nor received comments on the
proposed rule change.

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

    The foregoing rule change has become effective pursuant to section
19(b)(3)(A)

of the Act \29\ and paragraph (f) of Rule 19b-4 \30\ thereunder. At any
time within 60 days of the filing of the proposed rule change, the
Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act. If the Commission takes such
action, the Commission will institute proceedings to determine whether
the proposed rule change should be approved or disapproved.
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    \29\ 15 U.S.C. 78s(b)(3)(A).
    \30\ 17 CFR 240.19b-4(f).
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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-CboeBZX-2023-030 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-CboeBZX-2023-030. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to File Number SR-CboeBZX-2023-030 and should be submitted
on or before June 7, 2023.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\31\
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    \31\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-10465 Filed 5-16-23; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 245 (Friday, December 20, 2019)]
[Rules and Regulations]
[Pages 70014-70017]
[FR Doc No: 2019-27526]

=======================================================================
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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket Number USCG-2019-0945]
RIN 1625-AA08

Special Local Regulation; St. Thomas Lighted Boat Parade, St.
Thomas, U.S. Virgin Island

AGENCY: Coast Guard, DHS.

ACTION: Temporary final rule.

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SUMMARY: The Coast Guard is establishing a special local regulation for
the St. Thomas Lighted Boat Parade marine event. The special local
regulation is for certain navigable waters of Crown Bay, Haulover Cay,
and St. Thomas Harbor, St. Thomas, U.S. Virgin Islands. The special
local regulation is necessary to ensure the safety of vessels,
spectators, and public during the event. Entry of vessels or persons
into this zone is prohibited unless specifically authorized by the
Captain of the Port San Juan or a designated representative.

DATES: This rule is effective without actual notice from 6:30 p.m.
until 9:00 p.m. on December 20, 2019.

ADDRESSES: To view documents mentioned in this preamble as being
available in the docket, go to https://www.regulations.gov, type USCG-
2019-0945 in the ``SEARCH'' box and click ``SEARCH.'' Click on Open
Docket Folder on the line associated with this rule.

FOR FURTHER INFORMATION CONTACT: If you have questions on this rule,
call or email LCDR Pedro L. Mendoza, Waterways Management Division,
U.S. Coast Guard; telephone<PHONE_NUMBER>, email
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Table of Abbreviations

CFR Code of Federal Regulations
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of proposed rulemaking
Sec.  Section
U.S.C. United States Code

II. Background Information and Regulatory History

    The Coast Guard is issuing this temporary rule without prior notice
and opportunity to comment pursuant to authority under section 4(a) of
the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This
provision authorizes an agency to issue a rule without prior notice and
opportunity to comment when the agency for good cause finds that those
procedures are ``impracticable, unnecessary, or contrary to the public
interest.'' Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good
cause exists for not publishing a notice of proposed rulemaking (NPRM)
with respect to this rule because the Coast Guard did not receive
notice of the marine event from involved parties with sufficient time
to publish a NPRM and to receive public comments prior to the event. It
is impracticable to publish an NPRM because the Coast Guard did not
receive notice of the boat parade until December 4, 2019, and the
special local regulation is needed for December 20, 2019. This action
is necessary for the protection of life and property on the navigable
waters of the United States. Therefore, it would be contrary to the
public interest to postpone establishing this temporary special local
regulation.
    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause
exists for making this rule effective less than 30 days after
publication in the Federal Register for the same reason discussed
above.

III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 46 U.S.C.
70034 (previously 33 U.S.C. 1231). The purpose of this rule is to
ensure safety of the event participants, vessels and the navigable
waters of Crown Bay, Haulover Clay and St. Thomas Harbor, St. Thomas,
U.S. Virgin Islands (USVI), during the St. Thomas Lighted Boat Parade.
The Captain of the Port (COTP) has determined that potential hazards
associated with the marine parade event will pose a safety concern for
any persons and vessels within the regulated area.

IV. Discussion of the Rule

    This rule establishes a temporary special local regulation on
certain navigable waters of the Crown Bay, Haulover Cay, and St. Thomas
Harbor, St. Thomas, USVI during the St. Thomas Lighted Boat Parade from
6:30 p.m. until 9:00 p.m. on December 20, 2019. The regulated area will
encompass all waters within a 100-foot radius of participating vessels,
beginning with the lead vessel, ending with the last participating
vessel, and at all times extending 100-feet on either side of the
parade vessels. The parade route consist of a course that starts at
Crown Bay Marina in potion 18[deg]19'986'' N, 64[deg]57'088'' W;
proceeds thence east through Haulover Cut, thence northeast throu Cay
Bay, thence east towards the Coast Guard Base in Kings Wharf and thence
back through the same route to the beginning position. All coordinates
are North American Datum 1983.
    The special local regulation is intended to protect personnel,
vessels, and the marine environment in these navigable waters during
the power boat races. All persons and non-participating vessels are
prohibited from entering, transiting through, anchoring in, or
remaining within the regulated area unless authorized by the COTP San
Juan or a designated representative. Persons and vessels may request
authorization to enter, transit through, anchor in, or remain within
the regulated area by contacting the COTP San Juan or a designated
representative. If authorization to enter, transit through, anchor in,
or remain within the regulated area is granted, all persons and vessels
receiving such authorization must comply with the instructions of the
COTP San Juan or a designated representative. The Coast Guard will
provide notice of the regulated area by Local Notice to Mariners,
Broadcast Notice to Mariners, and/or by on-scene designated
representatives.

V. Regulatory Analyses

    We developed this rule after considering numerous statutes and
Executive orders related to rulemaking. Below we summarize our analyses
based on a number of these statutes and Executive orders, and we
discuss First Amendment rights of protestors.

A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits. Executive Order 13771 directs agencies to control
regulatory costs through a budgeting process. This rule has not been
designated a ``significant regulatory action,'' under Executive Order
12866. Accordingly, this rule has not been reviewed by the Office of
Management and Budget (OMB), and pursuant to OMB guidance it is exempt
from the requirements of Executive Order 13771.
    This regulatory action determination is based on the size,
location, and duration of the regulated area. The regulated area will
impact a small designated area of Crown Bay, Haulover Cay, and St.
Thomas Harbor, St. Thomas, USVI, during the event and thus is limited
in scope. The special local regulation will be enforced for only a
total period of 2.5 hours and thus is limited in time. Although persons
and vessels will not be able to enter, transit through, anchor in, or
remain within the zone without authorization from the Captain of the
Port San Juan or a designated representative, they may operate in the
surrounding area during the enforcement period. The rule will allow
vessels to seek permission to enter the regulated area. Persons and
vessels may still enter, transit through, anchor in, or remain within
the regulated area during the enforcement period if authorized by the
Captain of the Port San Juan or a designated representative. The Coast
Guard will issue a Local Notice to Mariners and a Broadcast Notice to
Mariners, allowing mariners to make alternative plans or seek
permission to transit the regulated area.

B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as
amended, requires Federal agencies to consider the potential impact of
regulations on small entities during rulemaking. The term ``small
entities'' comprises small businesses, not-for-profit organizations
that are independently owned and operated and are not dominant in their

fields, and governmental jurisdictions with populations of less than
50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule
will not have a significant economic impact on a substantial number of
small entities.
    While some owners or operators of vessels intending to enter,
transit through, anchor in, or remain witin the regulated area may be
small entities, for the reason stated in section V. A. above, this rule
will not have a significate economic impact on any vessel owner or
operator.
    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we want to assist small
entities in understanding this rule. If the rule would affect your
small business, organization, or governmental jurisdiction and you have
questions concerning its provisions or options for compliance, please
call or email the person listed in the FOR FURTHER INFORMATION CONTACT
section.
    Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247). The Coast Guard will not retaliate against small
entities that question or complain about this rule or any policy or
action of the Coast Guard.

C. Collection of Information

    This rule will not call for a new collection of information under
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has 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. We have analyzed this rule under that Order and have
determined that it is consistent with the fundamental federalism
principles and preemption requirements described in Executive Order
13132.
    Also, this rule does not have tribal implications under Executive
Order 13175, Consultation and Coordination with Indian Tribal
Governments, because it does not have a substantial direct effect on
one or more Indian tribes, on the relationship between the Federal
Government and Indian tribes, or on the distribution of power and
responsibilities between the Federal Government and Indian tribes. If
you believe this rule has implications for federalism or Indian tribes,
please call or email the person listed in the FOR FURTHER INFORMATION
CONTACT section above.

E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their discretionary
regulatory actions. In particular, the Act addresses actions that may
result in the expenditure by a State, local, or tribal government, in
the aggregate, or by the private sector of $100,000,000 (adjusted for
inflation) or more in any one year. Though this rule will not result in
such an expenditure, we do discuss the effects of this rule elsewhere
in this preamble.

F. Environment

    We have analyzed this rule under Department of Homeland Security
Directive 023-01, Rev. 1, associated implementing instructions, and
Environmental Planning COMDTINST 5090.1 (series), which guide the Coast
Guard in complying with the National Environmental Policy Act of 1969
(42 U.S.C. 4321-4370f), and have determined that this action is one of
a category of actions that do not individually or cumulatively have a
significant effect on the human environment. This rule involves a
creation of a regulated area in conjunction with a regatta or marine
parade to ensure the safety of vessels, spectators, and the public
during the event. It is categorically excluded from further review
under paragraph L61 in Table 3-1 of U.S. Coast Guard Environmental
Planning Implementing Procedures. A Record of Environmental
Consideration supporting this determination is available in the docket.
For instructions on locating the docket, see the ADDRESSES section of
this preamble.

G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters.
Protesters are asked to call or email the person listed in the FOR
FURTHER INFORMATION CONTACT section to coordinate protest activities so
that your message can be received without jeopardizing the safety or
security of people, places or vessels.

List of Subjects in 33 CFR Part 100

    Marine safety, Navigation (water), Reporting and recordkeeping
requirements, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends
33 CFR part 100 as follows:

PART 100--SAFETY OF LIFE ON NAVIGABLE WATERS

0
1. The authority citation for part 100 continues to read as follows:

    Authority:  46 U.S.C. 70041; 33 CFR 1.05-1.

0
2. Add Sec.  100.T799-0945 to read as follows:

Sec.  100.T799-0945  Safety zones; St. Thomas Lighted Boat Parade,
Crown Bay, Haulover Cut and St. Thomas Harbor, St. Thomas, U.S. Virgin
Islands

    (a) Location. The following area is a special local regulation: All
waters within a 100-foot radius in front of the lead parade vessel,
100-feet behind the last participating parade vessel, and at all times
extending 100-feet on either side of participating parade vessels. The
St. Thomas Lighted Boat Parade consists of a course that starts at
Crown Bay Marina in position 18[deg]19'986'' N, 64[deg]57'088'' W;
proceeds thence east through Haulover Cut, thence northeast through Cay
Bay, thence east towards the Coast Guard Base in Kings Wharf and thence
west back through the same route to the beginning position. All
coordinates are North American Datum 1983.
    (b) Definition. The term ``designated representative'' means Coast
Guard Patrol Commanders, including Coast Guard coxswains, petty
officers, and other officers operating Coast Guard vessels, and
Federal, state, and local officers designated by or assisting the
Captain of the Port San Juan in the enforcement of the regulated areas.
    (c) Regulations. (1) All persons and non-participant vessels are
prohibited from entering, transiting through, anchoring in, or
remaining within the regulated area unless authorized by the COTP San
Juan or a designated representative.
    (2) Persons and vessels may request authorization to enter, transit
through, anchor in, or remain within the regulated areas by contacting
the COTP San Juan by telephone at<PHONE_NUMBER>, or a designated
representative via VHF radio on channel 16. If authorization is granted
by the COTP San Juan or a designated representative, all persons and
vessels receiving such authorization must comply with the instructions
of the COTP San Juan or a designated representative.

    (3) The Coast Guard will provide notice of the regulated areas by
Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene
designated representatives.
    (d) Enforcement Period. This rule will be enforced from 6:30 p.m.
until 9:00 p.m. on December 20, 2019, unless sooner terminated by the
COTP San Juan.

    Dated: December 16, 2019.
E.P. King,
Captain, U.S. Coast Guard, Captain of the Port San Juan.
[FR Doc. 2019-27526 Filed 12-19-19; 8:45 am]
BILLING CODE 9110-04-P