[Federal Register Volume 87, Number 72 (Thursday, April 14, 2022)]
[Notices]
[Pages 22240-22245]
[FR Doc No: 2022-07952]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94652; File No. SR-PEARL-2022-10]

Self-Regulatory Organizations: MIAX PEARL, LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX
Pearl Equities Fee Schedule

April 8, 2022.
    Pursuant to the provisions of 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 31, 2022, MIAX PEARL, LLC (``MIAX Pearl''
or ``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') a 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is filing a proposal to amend the fee schedule (the
``Fee Schedule'') applicable to MIAX Pearl Equities, an equities
trading facility of the Exchange.
    The text of the proposed rule change is available on the Exchange's
website at http://www.miaxoptions.com/rule-filings/pearl at MIAX
Pearl's principal office, and at the Commission's Public Reference
Room.

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

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

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

1. Purpose
    The purpose of the proposed rule change is to amend the Exchange's
Fee Schedule to (i) adopt a new Liquidity Code and associated rebate to
the Liquidity Indicator Codes and Associated Fees table; (ii) adopt new
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers to improve
market quality on the Exchange by offering an enhanced rebate for
executions that Add Liquidity at the Midpoint of the PBBO \3\ using a
Midpoint Peg Order \4\ in securities priced at or above $1.00 per share
that add liquidity and are pegged to the midpoint of the bid and ask;
and (iii) amend section 1(d) Remove Volume Tiers table to increase the
fee.
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    \3\ The term ``PBBO'' means the best bid or offer on MIAX Pearl.
See Exchange Rule 100.
    \4\ A Midpoint Peg Order is a non-displayed Limit Order that is
assigned a working price pegged to the midpoint of the PBBO. A
Midpoint Peg Order receives a new timestamp each time its working
price changes in response to changes in the midpoint of the PBBO.
See Exchange Rule 2614(a)(3).
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    The Exchange first notes that it operates in a highly competitive
market in which market participants can readily direct order flow to
competing venues if they deem fee levels at a particular venue to be
excessive or incentives to be insufficient. More specifically, the
Exchange is only one of 16 registered equities exchanges, as well as a
number of alternative trading systems and other off-exchange venues, to
which market participants may direct their order flow. Based on
publicly available information, no single registered equities exchange
currently has more than approximately 17% of the total market share of
executed volume of equities trading, and the Exchange currently
represents approximately 1% of the overall market share.\5\
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    \5\ See MIAX's ``The Market at a Glance'', available at https://www.miaxoptions.com/ (last visited March 24, 2022).
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    Additionally, in response to the competitive environment, the
Exchange also offers tiered pricing, which provides Equity Members \6\
(``Members'') with opportunities to qualify for higher rebates or lower
fees when certain volume criteria and thresholds are met. Tiered
pricing provides an incremental incentive for Members to strive for
higher tier levels, which provides increasingly higher benefits or
discounts for satisfying increasingly more stringent criteria.
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    \6\ The term ``Equity Member'' is a Member authorized by the
Exchange to transact business on MIAX Pearl Equities. See Exchange
Rule 1901.
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Adoption of Midpoint Peg Order Adding Liquidity at Midpoint Volume
Tiers
    The Exchange is now proposing to introduce a new tiered pricing
structure applicable to rebates provided for executions that add
liquidity to the Exchange at the Midpoint of the PBBO using a Midpoint
Peg Order (such orders, ``Midpoint Peg Add Orders executed at the
Midpoint''). Specifically, the Exchange proposes to adopt new volume-
based tiers, referred to by the Exchange as, ``Midpoint Peg Order
Adding Liquidity at Midpoint Volume Tiers,'' in which the Exchange will
provide an enhanced rebate for executions of Midpoint Peg Add Orders
executed at the Midpoint for Members that meet certain volume
thresholds on the Exchange.
    The Exchange currently provides a standard rebate of $0.0021 per
share for executions of Added Non-Displayed Liquidity.\7\ The Exchange
now proposes to introduce a tiered pricing structure in which it will
provide an enhanced, incremental rebate of $0.0004 per share for an
effective total rebate of $0.0025

for executions of Midpoint Peg Add Orders executed at the Midpoint for
Members that qualify for Tier 1 of the Midpoint Peg Order Adding
Liquidity at Midpoint Volume Tiers by achieving a Midpoint ADAV \8\
equal to or greater than 500,000 shares. The Exchange also proposes to
provide an enhanced, incremental rebate of $0.0006 per share for an
effective total rebate of $0.0027 for executions of Midpoint Peg Add
Orders executed at the Midpoint for Members that qualify for Tier 2 of
the Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers by
achieving a Midpoint ADAV equal to or greater than 1,000,000 shares.
The rebates provided for by the Midpoint Peg Order Adding Liquidity at
Midpoint Volume Tiers will be applicable to executions of orders that
yield fee code ``Ap'' as described below and will be provided in place
of the standard rebate of $0.0021 per share for executions of Added
Non-Displayed Volume. The Exchange notes that the rebates described
above will not apply to executions of orders in securities priced below
$1.00 per share.
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    \7\ The Exchange notes that the standard rebate of $0.0021 per
share for executions of Added Non-Displayed Liquidity in securities
priced at or above $1.00 is not changing under this proposal.
    \8\ For this program, Midpoint ADAV will refer to the average
daily added volume consisting of Midpoint Peg Add Orders executed at
the Midpoint (as described herein) for the current month calculated
similarly to ADAV. ``ADAV'' means average daily added volume
calculated as the number of shares added per day and ``ADV'' means
average daily volume calculated as the number of shares added or
removed, combined, per day. ADAV and ADV are calculated on a monthly
basis. The Exchange excludes from its calculation of ADAV and ADV
shares added or removed on any day that the Exchange's system
experiences a disruption that lasts for more than 60 minutes during
regular trading hours (``Exchange System Disruption''), on any day
with a scheduled early market close, and on the ``Russell
Reconstitution Day'' (typically the last Friday in June). Routed
shares are not included in the ADAV or ADV calculation. With prior
notice to the Exchange, an Equity Member may aggregate ADAV or ADV
with other Equity Members that control, are controlled by, or are
under common control with such Equity Member (as evidenced on such
Equity Member's Form BD). See MIAX Pearl Equities Fee Schedule,
``Definitions,'' available at (https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Pearl_Equities_Fee_Schedule_01032022.pdf).
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    The purpose of the proposed enhanced rebate for executions of
Midpoint Peg Add Orders executed at the Midpoint is to encourage
Members that provide liquidity through non-displayed orders to strive
for a higher Midpoint ADAV on the Exchange in order to qualify for the
enhanced rebates for executions of Midpoint Peg Add Orders executed at
the Midpoint, and as such, encourages Members to maintain or increase
their order flow (particularly in the form of liquidity adding non-
displayed Midpoint Peg Orders that execute at the Midpoint) to the
Exchange, thereby contributing to a deeper and more liquid market to
the benefit of all market participants.
    The Exchange's pricing structure is generally designed to encourage
the provision of liquidity, thus the proposed enhanced rebates for
executions of Midpoint Peg Add Orders executed at the Midpoint is
designed to encourage Members that use non-displayed orders to provide
additional non-displayed liquidity through the use of orders that are
designed to execute at the midpoint of the PBBO. The Exchange believes
that providing enhanced rebates for executions of Midpoint Peg Add
Orders executed at the Midpoint is a reasonable means to incentivize
Members to provide additional liquidity at the midpoint of the PBBO,
which in turn would increase the attractiveness of the Exchange as a
destination venue, as Members seeking price improvement would be more
motivated to direct their orders to the Exchange because they would
have a heightened expectation of the availability of liquidity at the
midpoint of the PBBO. The Exchange notes that the proposed enhanced
rebate is comparable to, and competitive with, the rebate provided by
at least one other exchange for executions of non-displayed orders in
securities priced at or above $1.00 per share that are pegged to the
midpoint.\9\
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    \9\ See MEMX trading fee schedule on its public website
(available at https://info.memxtrading.com/fee-schedule/) which
reflects a rebate of $0.0028 per share for added non-displayed
liquidity under Tier 1 of its Non-Display Add Tiers; and a rebate of
$0.0024 per share for added non-displayed liquidity under Tier 2 of
its Non-Display Add Tiers.
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New Liquidity Indicator Code
    In conjunction with the Exchange's proposal to (i) provide an
enhanced, incremental rebate of $0.0004 per share for Midpoint Peg
Orders that Add Liquidity and meet the Tier 1 requirements of the
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers; and (ii)
provide an enhanced, incremental rebate of $0.0006 per share for
Midpoint Peg Orders that Add Liquidity and meet the Tier 2 requirements
of the Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers,
the Exchange proposes to update the Liquidity Indicator Code and
Associated Fees Table as follows:
     Add new liquidity indicator code Ap, Adds Liquidity and
Executes at the Midpoint, Non-Displayed Midpoint Peg Order (All Tapes).
The Liquidity Indicator Code and Associated Fees table would specify
that orders that yield liquidity indicator code Ap would receive a
rebate of $0.0021 per share in securities priced at or above $1.00 and
0.05% of the transaction's dollar value in securities priced below
$1.00.
    The Exchange also proposes to add the above liquidity indicator
code to the Standard Rates table. Specifically, liquidity indicator
code Ap would be added to the ``Added Liquidity Non-Displayed Order''
column.
Increase Fee for Remove Volume Tiers
    Currently, the Exchange charges a standard fee of $0.0029 for all
executions of Removed Volume.\10\ The Exchange also offers a two-tiered
pricing structure for fees charged for executions of Removed Volume on
the Exchange for Members that meet certain thresholds. Members that
qualify for Tier 1 by achieving an ADV \11\ that is equal to or greater
than 0.10% of TCV \12\ are charged $0.0027 per share for executions of
Removed Volume. Members that qualify for Tier 2 by achieving an ADV
that is equal to or greater than 0.15% of TCV are charged a fee of
$0.00265 per share for Executions of Removed Volume.
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    \10\ The Exchange notes that the standard fee of $0.0029 for
orders removing liquidity in securities priced at or above $1.00 is
not changing under this proposal.
    \11\ See supra note 8.
    \12\ ``TCV'' means total consolidated volume calculated as the
volume in shares reported by all exchanges and reporting facilities
to a consolidated transaction reporting plan for the month for which
the fees apply. The Exchange excludes from this calculation of TCV
volume on any given day that the Exchange's system experiences a
disruption that lasts for more than 60 minutes during Regular
Trading Hours, on any day with a scheduled early market close, and
on the ``Russell Reconstitution Day'' (typically the last Friday in
June). See MIAX Pearl Equities Fee Schedule, ``Definitions,''
available at https://www.miaxoptions.com/fees/pearl-equities).
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    The Exchange now proposes to increase the fees charged for Removed
Volume in Tier 1 and Tier 2 to $0.0028 and $0.0027 respectively, an
increase of $0.0001 and $0.00005 respectively. The purpose of
increasing the fee for executions of Removed Volume is for business and
competitive reasons. The requirements necessary to qualify for Tier 1
and Tier 2 will remain unchanged under this proposal. The Exchange
notes that despite the proposed increase the proposed fee changes for
Removed Volume Tiers remain comparable to, and competitive with, the
fees charged for executions of liquidity-removing orders charged by
other exchanges under similar volume-based tiers.\13\

Additionally, the Exchange notes that the Remove Volume Tiers, as
modified, would continue to be available to all Members.
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    \13\ See the Cboe EDGX equities trading fee schedule on its
public website (available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/) which reflects fees charged under
``Remove Volume Tiers''--tiers based on a member achieving certain
step-up ADAV and ADV volume thresholds of $0.00275 per share for
removing volume from the Cboe EDGX exchange; See also MEMX fee
schedule on its public website (available at https://info.memxtrading.com/fee-schedule/) which reflects a fee per share
charge of $0.00285 under ``Liquidity Removal Tier'' for a Member
that has (1) an ADAV [gteqt]0.30% of the TCV; or (2) an ADV
[gteqt]0.60% of the TCV.
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Implementation
    The Exchange proposes to implement the changes to the Fee Schedule
pursuant to this proposal on April 1, 2022.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \14\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \15\ in
particular, in that it is an equitable allocation of reasonable fees
and other charges among its Equity Members and issuers and other
persons using its facilities. The Exchange also believes that the
proposed rule change is consistent with the objectives of Section
6(b)(5) \16\ requirements that the rules of an exchange be designed to
prevent fraudulent and manipulative acts and practices, and to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest, and, particularly, is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(4).
    \16\ 15 U.S.C 78f(b)(5).
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    The Exchange operates in a highly fragmented and competitive market
in which market participants can readily direct their order flow to
competing venues if they deem fee levels at a particular venue to be
excessive or incentives to be insufficient. More specifically, the
Exchange is only one of sixteen registered equities exchanges, and
there are a number of alternative trading systems and other off-
exchange venues, to which market participants may direct their order
flow. Based on publicly available information, no single registered
equities exchange currently has more than approximately 17% of the
total market share of executed volume of equities trading.\17\ Thus, in
such a low-concentrated and highly competitive market, no single
equities exchange possesses significant pricing power in the execution
of order flow, and the Exchange currently represents less than 1% of
the overall market share. The Commission and the courts have repeatedly
expressed their preference for competition over regulatory intervention
in determining prices, products, and services in the securities
markets. 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.'' \18\
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    \17\ See supra note 5.
    \18\ Securities Exchange Act Release No. 51808 (June 9, 2005),
70 FR 37499 (June 29, 2005).
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    The Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
shift order flow or discontinue to reduce use of certain categories of
products, in response to new or different pricing structures being
introduced into the market. Accordingly, competitive forces constrain
the Exchange's transaction fees and rebates, and market participants
can readily trade on competing venues if they deem pricing levels at
those other venues to be more favorable. The Exchange believes the
proposal reflects a reasonable and competitive pricing structure
designed to incentivize market participants to direct their order flow
to the Exchange, which the Exchange believes would enhance liquidity
and market quality to the benefit of all Members and market
participants.
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers
    The Exchange believes that the proposed Midpoint Peg Order Adding
Liquidity at Midpoint Volume Tiers are reasonable because they would
provide Members with an additional incentive to achieve certain volume
thresholds on the Exchange. The Exchange notes that volume-based
incentives and discounts have been widely adopted by exchanges,\19\ and
are reasonable, equitable, and not unfairly discriminatory because they
are open to all Members on an equal basis and provide additional
benefits or discounts that are reasonably related to the value to an
exchange's market quality associated with higher levels of market
activity, such as higher levels of liquidity provision and the
introduction of higher volumes of orders into the price and volume
discovery processes. The Exchange believes that the proposal reflects a
reasonable and competitive pricing structure designed to incentivize
market participants to direct their order flow to the Exchange, to
enhance market quality and to provide price improvement through the use
of orders that are designed to execute at the midpoint of the PBBO
through the provision of enhanced rebates for executions of Midpoint
Peg Add Orders executed at the Midpoint for Members that qualify for
one of the Midpoint Peg Order Adding Liquidity at Midpoint Volume
Tiers.\20\ The Exchange believes its proposal will promote price
improvement and increased liquidity on the Exchange which will benefit
all market participants.
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    \19\ See Cboe EDGX equities trading fee schedule on its public
website (available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/); Cboe BZX equities trading fee schedule on its
public website (available at https://www.cboe.com/us/equities/membership/fee_schedule/bzx/); and MEMX equities trading fee
schedule on its public website (available at https://info.memxtrading.com/fee-schedule/).
    \20\ The Exchange notes that Members that do not qualify for one
of the Midpoint Peg Order Adding Liquidity at Midpoint Volume Tier
will receive the standard rebate of $0.0021 for Non-Displayed
Midpoint Peg Orders that Add Liquidity in securities priced at or
above $1.00.
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    Additionally, the Exchange believes that the proposed enhanced,
incremental rebate for executions of Midpoint Peg Add Orders executed
at the Midpoint under Midpoint Peg Order Adding Liquidity at Midpoint
Volume Tier 1 (i.e., $0.0004 per share) is reasonable, in that it does
not reflect a disproportionate increase above the standard rebate of
$0.0021 per share provided to all Members with respect to Added Non-
Displayed Liquidity. Additionally, the Exchange believes that the
proposed enhanced, incremental rebate for executions of Midpoint Peg
Add Orders executed at the Midpoint under Midpoint Peg Order Adding
Liquidity at Midpoint Volume Tier 2 (i.e., $0.0006 per share) is
reasonable, in that it does not reflect a disproportionate increase
above the enhanced rebate of $0.0004 per share provided to Members that
satisfy the requirements of Midpoint Peg Order Adding Liquidity at
Midpoint Volume Tier 1.
    The Exchange believes the proposed new criteria is equitable and
non-discriminatory because all Members will continue to be eligible to
qualify for Midpoint Peg Order Adding Liquidity at Midpoint Volume
Tiers 1 and 2 and have the opportunity to receive the corresponding
enhanced rebate if such criteria is achieved.

    The Exchange further believes that the proposed new criteria for
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tier 1, and
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tier 2, are
reasonable, in that the proposed new criteria for Midpoint Peg Order
Adding Liquidity at Midpoint Volume Tier 2 is incrementally more
difficult to achieve than that of Midpoint Peg Order Adding Liquidity
at Midpoint Volume Tier 1, thus, Midpoint Peg Order Adding Liquidity at
Midpoint Volume Tier 2 appropriately offers a higher rebate
commensurate with the corresponding higher Midpoint ADAV requirement.
Therefore, the Exchange believes the Midpoint Peg Order Adding
Liquidity at Midpoint Volume Tiers, as proposed, are consistent with an
equitable allocation of fees and rebates, as the more stringent
criteria correlates with the corresponding tier's higher rebate.
    The Exchange further believes that the enhanced rebates provided
under the Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers,
as proposed, (i.e., $0.0004 per share for Tier 1; and $0.0006 per share
for Tier 2) are reasonable, consistent with an equitable allocation of
fees, and that it is not unfairly discriminatory to pay such higher
rebates for executions of Midpoint Peg Add Orders executed at the
Midpoint to Members that qualify for either Tier 1 or Tier 2 under the
Midpoint Peg Order Adding Liquidity at Midpoint Volume Tiers in
comparison with the standard rebate in recognition of the benefits to
the Exchange and market participants as described above, particularly
as the magnitude of the enhanced rebate is not unreasonably high and is
reasonably related to the enhanced market quality it is designed to
achieve. Additionally, the Exchange believes that the proposed rebates
are reasonable as such rebates are comparable to, and competitive with,
the rebates for executions of liquidity-adding non-displayed orders
provided by at least one other exchange under similar volume-based
tiers.\21\
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    \21\ See supra note 9.
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    The Exchange believes that providing an enhanced rebate for
Midpoint Peg Add Orders executed at the Midpoint that is higher than
the standard rebate for executions of other non-displayed orders in
securities priced at or above $1.00 per share that add liquidity to the
Exchange is reasonable, as the Exchange believes this would encourage
Members that provide liquidity through non-displayed orders to do so,
to a greater extent, through orders designed to execute at the midpoint
of the PBBO. Because such orders provide price improvement to the
benefit of other market participants, the Exchange believes it is
reasonable and consistent with an equitable allocation of fees to
provide an enhanced rebate to encourage their use, while still
maintaining an overall pricing structure that places greater emphasis
on the value of liquidity in advancing transparency and price
discovery.
New Liquidity Indicator Code
    The Exchange believes its proposal to add new liquidity indicator
code ``Ap'' to the Liquidity Indicator Codes and Associated Fees table
and to add liquidity indicator code ``Ap'' to the ``Adding Liquidity
Non-Displayed Order'' column, is reasonable and equitable because it
will apply equally to all Members of the Exchange that submit Midpoint
Peg Orders. This liquidity indicator code would be returned on the
real-time trade reports sent to the Member that submitted the order.
The use of liquidity indicator codes is not unique to the Exchange as
liquidity indicator codes are currently utilized and described in the
fee schedules of other equity exchanges.\22\
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    \22\ See the fee schedule of MEMX LLC (``MEMX'') available on
their public website at https://info.memxtrading.com/fee-schedule/;
and the fee schedule of the Investors Exchange LLC (``IEX'')
available on their public website at https://exchange.iex.io/resources/trading/fee-schedule/.
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Remove Volume Tier
    The Exchange believes that the proposed fee change to the Remove
Volume Tiers is reasonable, consistent with an equitable allocation of
fees, and not unfairly discriminatory to provide a discounted fee for
executions of Remove Volume for Members that satisfy the requirements
associated with Tier 1 and Tier 2. The Exchange believes the proposed
fee changes are reasonable because the magnitude of the increase is not
unreasonably high and is also reasonably related to the enhanced market
quality it is designed to achieve.
    The Exchange believes the proposed increased fee for executions of
Removed Volume for a qualifying Member (i.e., $0.0028 and $0.0027 for
Tier 1 and Tier 2 respectively) is reasonable, as competing exchanges
offer tiered pricing structures similar to the proposed Remove Volume
Tier, including schedules of rebates and fees that apply based upon
Members achieving certain volume thresholds, and the Exchange believes
the proposed Remove Volume Tier's criteria are reasonable when compared
to such tiers provided for by other exchanges. For example, Cboe EDGX
charges lower fees for removing volume from Cboe EDGX under its
``Remove Volume Tiers'' at $0.00275 per share, compared to its standard
fee of $0.0030 per share, but requires different, but similar, criteria
than the Exchange's proposed Remove Volume Tier, which are also based
upon a Member's volume.\23\ MEMX also charges a lower fee for removing
volume from MEMX under its ``Liquidity Removal Tier'' at $0.00285 per
share, compared to its standard fee of $0.0030 per share, but requires
different, but similar, criteria than the Exchange's Remove Volume
Tier, which are also based upon a Member's volume.\24\
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    \23\ See Cboe EDGX equities trading fee schedule on its public
website (available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/).
    \24\ See MEMX trading fee schedule on its public website
(available at https://info.memxtrading.com/fee-schedule/).
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    The Exchange further believes the proposed Remove Volume Tier fees
are fair, equitable and not unfairly discriminatory because they are
available to all Members. Further, the proposed Remove Volume Tier fee
changes are comparable to the fees charged for executions of liquidity-
removing orders charged by Cboe EDGX and MEMX under similar volume
based tiers.\25\
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    \25\ See supra notes 23 and 24.
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    For the reasons discussed above, the Exchange submits that the
proposal satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of
the Act in that it provides for the equitable allocation of reasonable
dues, fees and other charges among its Members and other persons using
its facilities and is not designed to unfairly discriminate between
customers, issuers, brokers, or dealers. As described more fully below
in the Exchange's statement regarding the burden on competition, the
Exchange believes that its transaction pricing is subject to
significant competitive forces, and that the proposed fees and rebates
described herein are appropriate to address such forces.

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

    The Exchange does not believe that the proposed change will impose
any burden on competition not necessary or appropriate in furtherance
of the purposes of the Act. The Exchange believes the proposed change
would encourage Members to maintain or increase their order flow to the
Exchange, thereby contributing to a deeper and more liquid market to
the benefit of all market participants and enhancing the attractiveness
of the Exchange as a trading venue. As a

result, the Exchange believes the proposal would enhance its
competitiveness as a market that attracts actionable orders, thereby
making it a more desirable destination venue for its customers. For
these reasons, the Exchange believes that the proposal furthers the
Commission's goal in adopting Regulation NMS of fostering competition
among orders, which promotes ``more efficient pricing of individual
stocks for all types of orders, large and small.'' \26\
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    \26\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 47396 (June 29, 2005).
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Intramarket Competition
    The Exchange believes that the proposal would incentivize Members
to maintain or increase their order flow, thereby contributing to a
deeper and more liquid market to the benefit of all market participants
and enhance the attractiveness of the Exchange as a trading venue, and
to provide price improvement through the use of orders that are
designed to execute at the midpoint of the PBBO, which the Exchange
believes, in turn, would continue to encourage participants to direct
order flow to the Exchange. Greater liquidity benefits all Members by
providing more trading opportunities and encourages Members to send
orders to the Exchange, thereby contributing to robust levels of
liquidity, which benefits all market participants. The opportunity to
qualify for enhanced, incremental rebates under the Midpoint Peg Order
Adding Liquidity at Midpoint Volume Tiers would be available to all
Members that meet the associated requirements in any month. The
Exchange believes the requirements in the Midpoint Peg Order Adding
Liquidity at Midpoint Volume Tiers are reasonably related to the
enhanced market quality that the Midpoint Peg Order Adding Liquidity at
Midpoint Volume Tiers are designed to promote. Similarly, the proposed
enhanced rebate for executions of Midpoint Peg Orders would apply
equally to all Members. As such, the Exchange believes the proposed
changes would not impose any burden on intramarket competition that is
not necessary or appropriate in furtherance of the purposes of the Act.
    The opportunity to qualify for the Remove Volume Tier, and thus
receive the proposed lower fee for executions of Removed Volume, would
be available to all Members that meet the associated volume requirement
in any month. The Exchange believes that meeting the volume requirement
of the Remove Volume Tier is attainable for market participants, as the
Exchange believes the thresholds are relatively low and reasonably
related to the enhanced liquidity and market quality that the Remove
Volume Tier is designed to promote. As such, the Exchange believes the
proposed changes would not impose any burden on intramarket competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
Intermarket Competition
    The Exchange believes its proposal will benefit competition, and
the Exchange notes that it operates in a highly competitive market.
Members have numerous alternative venues they may participate on and
direct their order flow to, including fifteen other equities exchanges
and numerous alternative trading systems and other off-exchange venues.
As noted above, no single registered equities exchange currently has
more than 17% of the total market share of executed volume of equities
trading.\27\ Thus, in such a low-concentrated and highly competitive
market, no single equities exchange possesses significant pricing power
in the execution of order flow. Moreover, the Exchange believes that
the ever-shifting market share among the exchanges from month to month
demonstrates that market participants can shift order flow in response
to new or different pricing structures being introduced to the market.
Accordingly, competitive forces constrain the Exchange's transaction
fees and rebates generally, including with respect to executions of
Removed Volume, and market participants can readily choose to send
their orders to other exchanges and off-exchange venues if they deem
fee levels at those other venues to be more favorable.
---------------------------------------------------------------------------

    \27\ See supra note 5.
---------------------------------------------------------------------------

    As described above, the proposal is designed to enhance market
quality on the Exchange and to encourage more Members to maintain or
increase their order flow, thereby contributing to a deeper and more
liquid market to the benefit of all market participants and enhancing
the attractiveness of the Exchange as a trading venue, and to encourage
Members to provide price improvement through the use of orders that are
designed to execute at the midpoint of the PBBO. In turn, the Exchange
believes that the proposed enhanced rebates for executions of Midpoint
Peg Add Orders executed at the Midpoint that qualify for an enhanced
rebate under the Midpoint Peg Order Adding Liquidity at Midpoint Volume
Tiers would encourage the submission of additional order flow to the
Exchange, particularly in the form of Midpoint Peg Add Orders executed
at the Midpoint, thereby promoting market depth, enhanced execution
opportunities, price improvement, and price discovery to the benefit of
all Members and market participants. The opportunity to qualify for
discounted fees for Removed Volume under the Exchange's Remove Volume
Tiers continues to be available to all Members that meet the associated
volume criteria. The Exchange believes the discounted fees provided
under the Remove Volume Tiers are reasonably related to the enhanced
market quality that such tiers are designed to promote.
    As described above the Exchange's proposal is a competitive
proposal designed to encourage additional order flow to the Exchange
through a combination of volume based incentives and discounts, which
have been widely adopted by exchanges, and standard pricing that is
comparable to, and/or competitive with, pricing for similar executions
in place at other exchanges.\28\
---------------------------------------------------------------------------

    \28\ See supra notes 9, 13, 19, 23 and 24.
---------------------------------------------------------------------------

    Accordingly, the Exchange believes its proposal would not burden,
but rather promote, intermarket competition by enabling it to better
compete with other exchanges that offer similar standard pricing for
Added Midpoint Volume and Removed Volume, as well as similar pricing
incentives and discounts to market participants that achieves certain
volume criteria and thresholds.
    Additionally, the Commission has repeatedly expressed its
preference for competition over regulatory intervention in determining
prices, products, and services in the securities markets. Specifically,
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.'' \29\ The fact
that this market is competitive has also long been recognized by the
courts. In NetCoalition v. Securities and Exchange Commission, the D.C.
circuit stated: ``[n]o one disputes that competition for order flow is
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their routing agents, have a wide range of choices of where

to route orders for execution'; [and] `no exchange can afford to take
its market share percentages for granted' because `no exchange possess
a monopoly, regulatory or otherwise, in the execution of order flow
from broker dealers' . . .''.\30\ Accordingly, the Exchange does not
believe its proposed pricing changes impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
---------------------------------------------------------------------------

    \29\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
    \30\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010)
(quoting Securities Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSE-2006-21)).
---------------------------------------------------------------------------

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\31\ and Rule 19b-4(f)(2) \32\ 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 shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
---------------------------------------------------------------------------

    \31\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \32\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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-PEARL-2022-10 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-PEARL-2022-10. 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. 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-PEARL-2022-10 and should be submitted on
or before May 5, 2022.
---------------------------------------------------------------------------

    \33\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\33\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2022-07952 Filed 4-13-22; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: July 15, 2010 (Volume 75, Number 135)]
[Rules and Regulations]
[Page 41075-41076]
[DOCID:fr15jy10-3]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2009-1220; Airspace Docket No. 09-ANM-30]

Amendment of Class E Airspace; Bozeman, MT

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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

SUMMARY: This action will amend Class E airspace at Bozeman, MT, to
accommodate aircraft using a new VHF Omni-Directional Radio Range (VOR)
Standard Instrument Approach Procedures (SIAPs) at Gallatin Field
Airport. This will improve the safety and management of Instrument
Flight Rules (IFR) operations at the airport.

DATES: Effective date, 0901 UTC, September 23, 2010. The Director of
the Federal Register approves this incorporation by reference action
under 1 CFR part 51, subject to the annual revision of FAA Order 7400.9
and publication of conforming amendments.

FOR FURTHER INFORMATION CONTACT: Eldon Taylor, Federal Aviation
Administration, Operations Support Group, Western Service Center, 1601
Lind Avenue, SW., Renton, WA 98057; telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

History

    On April 19, 2010, the FAA published in the Federal Register a
notice of proposed rulemaking to amend Class E airspace at Bozeman, MT
(75 FR 20321). Interested parties were invited to participate in this
rulemaking effort by submitting written comments on the proposal to the
FAA. No comments were received.
    Class E airspace designations are published in paragraph 6004 and
6005, respectively, of FAA Order 7400.9T signed August 27, 2009, and
effective September 15, 2009, which is incorporated by reference in 14
CFR part 71.1. The Class E airspace designations listed in this
document will be published subsequently in that Order.

The Rule

    This action amends Title 14 Code of Federal Regulations (14 CFR)
Part 71 by adding additional Class E surface airspace, and additional
Class E airspace extending upward from 700 feet above the surface, at
Gallatin Field Airport, Bozeman, MT, to accommodate IFR aircraft
executing a new VOR SIAPs at the airport. This action is necessary for
the safety and management of IFR operations at the airport.
    The FAA has determined this regulation only involves an established
body of technical regulations for which frequent and routine amendments
are necessary to keep them operationally current. Therefore, this
regulation: (1) Is not a ``significant regulatory action'' under
Executive Order 12866; (2) is not a ``significant rule'' under DOT
Regulatory Policies and Procedures (44 FR 11034; February 26, 1979);
and (3) does not warrant preparation of a regulatory evaluation as the
anticipated impact is so minimal. Since this is a routine matter that
will only affect air traffic procedures and air navigation, it is
certified this rule, when promulgated, will not have a significant
economic impact on a substantial number of small entities under the
criteria of the

Regulatory Flexibility Act. The FAA's authority to issue rules
regarding aviation safety is found in Title 49 of the U.S. Code.
Subtitle 1, Section 106 discusses the authority of the FAA
Administrator. Subtitle VII, Aviation Programs, describes in more
detail the scope of the agency's authority. This rulemaking is
promulgated under the authority described in Subtitle VII, Part A,
Subpart I, Section 40103. Under that section, the FAA is charged with
prescribing regulations to assign the use of airspace necessary to
ensure the safety of aircraft and the efficient use of airspace. This
regulation is within the scope of that authority as it amends
controlled airspace at Gallatin Field Airport, Bozeman, MT.

List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

Adoption of the Amendment

0
In consideration of the foregoing, the Federal Aviation Administration
amends 14 CFR Part 71 as follows:

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

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

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

Sec.  71.1  [Amended]

0
2. The incorporation by reference in 14 CFR Part 71.1 of the Federal
Aviation Administration Order 7400.9T, Airspace Designations and
Reporting Points, signed August 27, 2009, and effective September 15,
2009 is amended as follows:

Paragraph 6004 Class E airspace are as designated as an Extension
to a Class D surface area.

* * * * *

ANM MT E4 Bozeman, MT [Modified]

Bozeman, Gallatin Field Airport, MT

    (Lat. 45[deg]46'39'' N., long. 111[deg]09'07'' W.)

    That airspace extending upward from the surface within 3 miles
each side of the 316[deg] bearing of Gallatin Field Airport,
extending from the 4.4-mile radius of the airport to 14 miles
northwest of Gallatin Field Airport; and that airspace 2.4 miles
each side of the 212[deg] bearing of the Gallatin Field Airport,
extending from the 4.4-mile radius of the airport to 7 miles
northwest of Gallatin Field Airport.

Paragraph 6005 Class E airspace areas extending upward from 700
feet or more above the surface of the earth.

* * * * *

ANM MT E5 Bozeman, MT [Modified]

Bozeman, Gallatin Field Airport, MT
    (Lat. 45[deg]46'39'' N., long. 111[deg]09'07'' W.)

    That airspace extending upward from 700 feet above the surface
within a 13.5-mile radius of Gallatin Field Airport, and within 4.8
miles northeast and 13 miles southwest of the 316[deg] bearing of
the airport extending from the 13.5-mile radius to 24.4 miles
northwest of Gallatin Field Airport.

    Issued in Seattle, Washington, on June 30, 2010.
John Warner,
Manager, Operations Support Group, Western Service Center.
[FR Doc. 2010-17131 Filed 7-14-10; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 81, Number 16 (Tuesday, January 26, 2016)]
[Proposed Rules]
[Pages 4214-4217]
[FR Doc No: 2016-01380]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2014-0338; Directorate Identifier 2014-CE-010-AD]
RIN 2120-AA64

Airworthiness Directives; Piper Aircraft, Inc. Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Supplemental notice of proposed rulemaking (NPRM); reopening of
comment period.

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

SUMMARY: We are revising an earlier proposed airworthiness directive
(AD) for certain Piper Aircraft, Inc. Model PA-31-350 airplanes. The
NPRM proposed to require inspecting the fuel hose assembly and the
turbocharger support assembly for proper clearance between them,
inspecting each assembly for any sign of damage, and making any
necessary repairs or replacements. The NPRM was prompted by a report of
an engine fire caused by a leak in the fuel pump inlet hose. This
action revises the NPRM by requiring the use of revised procedures in a
new service bulletin. We are proposing this supplemental NPRM (SNPRM)
to correct the unsafe condition on these products. Since these actions
impose an additional burden over that proposed in the NPRM, we are
reopening the comment period to allow the public the chance to comment
on these proposed changes.

DATES: We must receive comments on this SNPRM by March 11, 2016.

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 http://www.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: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.
    For service information identified in this proposed AD, contact
Piper Aircraft, Inc., 2926 Piper Drive, Vero Beach, Florida 32960;
telephone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; Internet:
www.piper.com/home/pages/Publications.cfm. You may view this referenced
service information at the FAA, Small Airplane Directorate, 901 Locust,
Kansas City, Missouri 64106. For information on the availability of
this material at the FAA, call<PHONE_NUMBER>.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-
0338; or in person at the Docket Management Facility between 9 a.m. and
5 p.m., Monday through Friday, except Federal holidays. The AD docket
contains this proposed AD, the regulatory evaluation, any comments
received, and other information. The street address for the Docket
Office (phone:<PHONE_NUMBER>) is in the ADDRESSES section. Comments will
be available in the AD docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Gary Wechsler, Aerospace Engineer,
FAA, Atlanta Aircraft Certification Office, 1701 Columbia Avenue,
College Park, Georgia 30337; telephone:<PHONE_NUMBER>; fax: (404) 474-
5606; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposed AD. Send your comments to an address
listed under the ADDRESSES section. Include ``Docket No. FAA-2014-0338;
Directorate Identifier 2014-CE-010-AD'' at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of this proposed AD. We
will consider all comments received by the closing date and may amend
this proposed AD because of those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    We issued an NPRM to amend 14 CFR part 39 by adding an AD that
would apply to certain Piper Aircraft, Inc. Model PA-31-350 airplanes.
The NPRM published in the Federal Register on June 3, 2014 (79 FR
31888). The NPRM proposed to require inspecting the fuel hose assembly
and the turbocharger support assembly for proper clearance between
them, inspecting each assembly for any sign of damage, and making any
necessary repairs or replacements.

Actions Since Previous NPRM Was Issued

    Since we issued the NPRM (79 FR 31888, June 3, 2014), Piper
Aircraft, Inc. has revised the related service information to clarify
which engines are part of the airplane applicability and to revise the
accomplishment instructions for inspecting for proper clearance between
the fuel hose assembly and the turbocharger support assembly,
inspecting the fuel hose assembly and the turbocharger support assembly
for any signs of damage, and taking all necessary corrective actions.

Comments

    We gave the public the opportunity to participate in developing
this AD. The following presents the comment received on the NPRM (79 FR
31888, June 3, 2014) and the FAA's response to the comment.

Request To Change the Applicability of the AD

    Joe Miller of Werbelow's Air Ventures, Inc., requested that the
Applicability section of the AD be changed so that it applies only to
Piper Aircraft, Inc. Model PA-31-350 airplanes with TIO-540-J2B engine
configurations.
    The commenter stated that Model PA-31-350 airplanes configured with
TIO-540-J2B engines have fuel pumps orientated such that their inlet
fuel hose assemblies can adversely contact a nearby turbocharger
support assembly. The commenter also stated that the other type
certificated engine configurations of applicable Model PA-31-350
airplanes have engine fuel pumps orientated such that their inlet fuel
hose assemblies cannot adversely contact the nearby turbocharger
support assembly.
    The commenter requested that the AD exclude Model PA-31-350
airplanes that have the fuel pump installed on a Lycoming (L)TIO-540-
J2BD engine.
    We partially agree with the commenter. We agree that there is more
than one orientation for the engine fuel pump in the applicable Model
PA-31-350 airplanes with (L)TIO-540 series engines because this is
shown in the Lycoming parts catalog for the TIO, LTIO-540-J2B, and -
J2BD engines, which were type certificated on the Model PA-31-350
airplane.
    We disagree with the commenter's request to change the actions of
the AD so that they apply only to the inlet hose assembly for the
engine fuel pump of the TIO-540-J2B engine configuration of applicable
Model PA-31-350 airplanes. We reviewed the Lycoming parts catalog for
the TIO, LTIO-540-J2B, and -J2BD engines and applicable Model PA-31-350
airplanes with (L)TIO-540-J2BD engines and found that the TIO and LTIO-
540-J2B and -J2BD engines each have a fuel pump with one fuel hose
assembly (either and inlet or exit) that can be incorrectly installed
so that it is in contact with the nearby turbocharger support assembly.

Related Service Information Under 1 CFR Part 51

    We reviewed Piper Aircraft, Inc. Service Bulletin No. 1257A, dated
August 4, 2015. The service information describes procedures for the
following. This service information is reasonably available because the
interested parties have access to it through their normal course of
business or by the means identified in the ADDRESSES section of this
SNPRM.

--Inspecting for a minimum 3/16-inch clearance between the fuel hose
assembly and the turbocharger support assembly and making any necessary
adjustments.
--Inspecting the fuel hose assembly for any signs of damage and, if
necessary, replacing with a serviceable part.
--Inspecting the turbocharger support assembly for any signs of damage
and, if necessary, repairing or replacing with a serviceable part.
--Performing an engine run-up to check for any leaks.

FAA's Determination

    We are proposing this SNPRM because we evaluated all the relevant
information and determined the unsafe condition described previously is
likely to exist or develop in other products of the same type design.
Certain changes described above expand the scope of the NPRM (79 FR
31888, June 3, 2014). As a result, we have determined that it is
necessary to reopen the comment period to provide additional
opportunity for the public to comment on this SNPRM.

Proposed Requirements of This SNPRM

    This SNPRM would require accomplishing the actions specified in the
service information described previously, except as discussed under
``Differences Between this Proposed AD and the Service Information.''

Differences Between This SNPRM and the Service Information

    There are differences between the compliance times for the
corrective actions in this proposed AD and those in the related service
information.
    We based the compliance times in this proposed AD on risk analysis
and cost impact to operators. There has only been one event of the
reported incident in the operational history of Piper Model PA-31-350
airplanes. Cost was also a strong consideration due to the age of the
fleet and the number of airplanes still in service.
    The one-time inspection required in this proposed AD is very
inexpensive and requires minimal time to accomplish. It is expected
that almost all airplanes in service can be cleared with a single
inspection, and no additional actions or costs would be incurred by the
vast majority of the fleet.
    We determined that a single inspection with any necessary
corrective actions is an adequate terminating action for the unsafe
condition. The risk related to future maintenance on the fuel line
would be mitigated by the related service information and awareness
from this proposed AD.

Costs of Compliance

    We estimate that this proposed AD affects 773 airplanes of U.S.
registry.
    We estimate the following costs to comply with this proposed AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per      Cost on U.S.
                Action                         Labor cost           Parts cost        product        operators
----------------------------------------------------------------------------------------------------------------
Inspect for proper clearance between    .5 work-hour x $85 per               N/A          $42.50      $32,852.50
 the fuel hose assembly and the          hour = $85.
 turbocharger support assembly.

Inspect the fuel hose assembly for      .5 work-hour x $85 per               N/A           42.50       32,852.50
 evidence of leaking, cracking,          hour = $42.50.
 chafing, and any other sign of damage.
Inspect the turbocharger support        .5 work-hour x $85 per               N/A           42.50       32,852.50
 assembly for evidence of chafing and    hour = $42.50.
 any other sign of damage.
Engine run-up/leak check..............  1 work-hour x $85 = $85              N/A           85.00       65,705.00
                                         (.5 work hour per
                                         engine).
----------------------------------------------------------------------------------------------------------------

    We estimate the following costs to do any necessary follow-on
actions that will be required based on the results of the inspection.
We have no way of determining the number of airplanes that might need
these corrective actions.

                                               On-Condition Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per
                    Action                                 Labor cost               Parts cost        product
----------------------------------------------------------------------------------------------------------------
Adjust routing of fuel hose assembly for        5.5 work-hours x $85 per hour =              N/A         $467.50
 proper clearance between the fuel hose          $467.50.
 assembly and the turbocharger support
 assembly.
Replace Piper fuel pump inlet hose assembly,    1 work-hour x $85 per hour = $85          $1,068        1,153.00
 part number 39995-34 (2 per airplane).
Replace Lycoming turbocharger support           24 work-hours x $85 per hour =            12,874       14,914.00
 assembly, part number LW-18302 (2 per           $2,040.
 airplane).
----------------------------------------------------------------------------------------------------------------

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.
    We are 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

    We 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) Is not a ``significant rule'' under the DOT Regulatory Policies
and Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) Will 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 (AD):

Piper Aircraft, Inc.: FAA-2014-0338; Directorate Identifier 2014-CE-
010-AD.

(a) Comments Due Date

    We must receive comments by March 11, 2016.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to Piper Aircraft, Inc. Model PA-31-350
airplanes, serial numbers 31-5001 through 31-5004, 31-7305005
through 31-8452024, and 31-8253001 through 31-8553002, certificated
in any category, that are equipped with the following engines and
fuel pump hose assemblies:

              Table 1 to Paragraph (c) of This AD--Applicable Engines and Fuel Pump Hose Assemblies
----------------------------------------------------------------------------------------------------------------
                                         Manufacturer's hose    Manufacturer's part No.
                Engine                           name                    (P/N)               Hose description
----------------------------------------------------------------------------------------------------------------
TIO-540-J2B (right wing).............  Hose Assembly--Fuel....  Piper 39995-034........  Inlet fuel hose to
                                                                                engine fuel pump.
LTIO-540-J2B (left wing).............  Hose, Fuel pump to       Lycoming LW-12877-6S142  Exit fuel hose from
                                        Injector.                                         engine fuel pump.
TIO540-J2BD (right wing).............  Hose, Fuel pump to       Lycoming LW-12877-6S142  Exit fuel hose from
                                        Injector.                                         engine fuel pump.

LTIO-540-J2BD (left wing)............  Hose Assembly--Fuel....  Piper 39995-034........  Inlet fuel hose to
                                                                                engine fuel pump.
----------------------------------------------------------------------------------------------------------------

(d) Subject

    Joint Aircraft System Component (JASC)/Air Transport Association
(ATA) of America Code 73: Engine Fuel and Control.

(e) Unsafe Condition

    This AD was prompted by a report of an engine fire caused by a
leak in the fuel pump inlet hose. We are issuing this AD to correct
the unsafe condition on these products.

(f) Compliance

    Comply with this AD within the compliance times specified in
paragraphs (g)(1) through (j)(2) of this AD, unless already done.

(g) Ensure Proper Clearance Between the Fuel Hose Assembly and the
Turbocharger Support Assembly

    (1) Within the next 60 hours time-in-service (TIS) after the
effective date of this AD or within the next 6 months after the
effective date of this AD, whichever occurs first, inspect to
determine the clearance between the inlet and exit fuel hose
assemblies listed in table 1 to paragraph (c) of this AD, and each
turbocharger support assembly, Lycoming P/N LW-18302. There should
be a minimum \3/16\-inch clearance. Do the inspection following the
INSTRUCTIONS section of Piper Aircraft, Inc. Service Bulletin No.
1257A, dated August 4, 2015.
    (2) Before further flight after the inspection required in
paragraph (g)(1) of this AD, if the measured clearance is less than
\3/16\-inch, make all necessary adjustments to make the clearance a
minimum of \3/16\-inch between the inlet and exit fuel hose
assemblies listed in table 1 to paragraph (c) of this AD and each
turbocharger support assembly, Lycoming P/N LW-18302, following the
INSTRUCTIONS section of Piper Aircraft, Inc. Service Bulletin No.
1257A, dated August 4, 2015.

(h) Visually Inspect the Fuel Hose Assembly and Replace if Necessary

    (1) Within the next 60 hours TIS after the effective date of
this AD or within the next 6 months after the effective date of this
AD, whichever occurs first, visually inspect the inlet and exit fuel
hose assemblies listed in table 1 to paragraph (c) of this AD for
evidence of leaking, cracking, chafing, and any other sign of
damage. Do the inspection following the INSTRUCTIONS section of
Piper Aircraft, Inc. Service Bulletin No. 1257A, dated August 4,
2015.
    (2) Before further flight after the inspection required in
paragraph (h)(1) of this AD, if any evidence of leaking, cracking,
chafing, or any other sign of damage is found in any inlet or exit
fuel host assembly listed in table 1 to paragraph (c) of this AD,
replace the fuel hose assembly with a serviceable part. Do the
replacement following the INSTRUCTIONS section of Piper Aircraft,
Inc. Service Bulletin No. 1257A, dated August 4, 2015.

(i) Visually Inspect the Turbocharger Support Assembly and Replace if
Necessary

    (1) Within the next 60 hours TIS after the effective date of
this AD or within the next 6 months after the effective date of this
AD, whichever occurs first, visually inspect each turbocharger
support assembly, Lycoming P/N LW-18302, for evidence of chafing and
any other signs of damage. Do the inspection following the
INSTRUCTIONS section of Piper Aircraft, Inc. Service Bulletin No.
1257A, dated August 4, 2015.
    (2) Before further flight after the inspection required in
paragraph (i)(1) of this AD, if any evidence of chafing or any other
sign of damage is found on any turbocharger support assembly,
replace Lycoming P/N LW-18302 with a serviceable part. Do the
replacement following the INSTRUCTIONS section of Piper Aircraft,
Inc. Service Bulletin No. 1257A, dated August 4, 2015.

(j) Engine Run-Up

    (1) If any fuel line component was adjusted or replaced during
any actions required in paragraphs (g)(1) through (i)(2) of this AD,
before further flight, perform an engine run-up on the ground to
check for leaks. Do the engine run-up following the INSTRUCTIONS
section of Piper Aircraft, Inc. Service Bulletin No. 1257A, dated
August 4, 2015.
    (2) If any leaks found during the engine run-up required in
paragraph (j)(1) of this AD emanate from any fuel line component
adjusted, repaired, or replaced during any actions required in
paragraphs (g)(1) through (i)(2) of this AD, before further flight,
take all necessary corrective actions following the INSTRUCTIONS
section of Piper Aircraft, Inc. Service Bulletin No. 1257A, dated
August 4, 2015.

(k) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Atlanta Aircraft Certification Office (ACO),
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 local
Flight Standards District Office, as appropriate. If sending
information directly to the manager of the ACO, send it to the
attention of the person identified in the Related Information
section of this AD.
    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.

(l) Related Information

    (1) For more information about this AD, contact Gary Wechsler,
Aerospace Engineer, FAA, Atlanta ACO, 1701 Columbia Avenue, College
Park, Georgia 30337; telephone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>;
email<EMAIL_ADDRESS>    (2) For service information identified in this AD, contact Piper
Aircraft, Inc., 926 Piper Drive, Vero Beach, Florida 32960;
telephone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; Internet:
www.piper.com/home/pages/Publications.cfm. You may review copies of
the referenced service information at the FAA, Small Airplane
Directorate, 901 Locust, Kansas City, Missouri 64106. For
information on the availability of this material at the FAA, call
(816) 329-4148.

    Issued in Kansas City, Missouri, on January 16, 2016.
Melvin Johnson,
Acting Manager, Small Airplane Directorate, Aircraft Certification
Service.
[FR Doc. 2016-01380 Filed 1-25-16; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register Volume 85, Number 123 (Thursday, June 25, 2020)]
[Notices]
[Pages 38250-38251]
[FR Doc No: 2020-13731]

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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

[Docket No. PHMSA-2013-0181]

Pipeline Safety: Request for Special Permit; Fairbanks Natural
Gas, L.L.C.

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA);
DOT.

ACTION: Notice.

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

SUMMARY: PHMSA is publishing this notice to solicit public comments on
a request from Fairbanks Natural Gas, L.L.C. (FNG) to renew a
previously issued special permit. The special permit renewal request is
seeking continued relief from compliance with certain requirements in
the Federal pipeline safety regulations. At the conclusion of the 30-
day comment period, PHMSA will review the comments received from this
notice as part of its evaluation to grant or deny the special permit
renewal.

DATES: Submit any comments regarding this special permit request by
July 27, 2020.

ADDRESSES: Comments should reference the docket number for this special
permit request and may be submitted in the following ways:
     E-Gov website: http://www.Regulations.gov. This site
allows the public to enter comments on any Federal Register notice
issued by any agency.
     Fax: 1-202-493-2251.
     Mail: Docket Management System: 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: Docket Management System: U.S. Department
of Transportation, Docket Operations, M-30, West Building Ground Floor,
Room W12-140, 1200 New Jersey Avenue SE, Washington, DC 20590, between
9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal
holidays.
    Instructions: You should identify the docket number for the special
permit request you are commenting on at the beginning of your comments.
If you submit your comments by mail, please submit two (2) copies. To
receive confirmation that PHMSA has received your comments, please
include a self-addressed stamped postcard. Internet users may submit
comments at http://www.Regulations.gov.
    Note: There is a privacy statement published on http://www.Regulations.gov. Comments, including any personal information
provided, are posted without changes or edits to http://www.Regulations.gov.
    Confidential Business Information: 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 notice 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 notice, it is important that you clearly designate
the submitted comments as CBI. Pursuant to 49 Code of Federal
Regulations (CFR) 190.343, you may ask PHMSA to give confidential
treatment to information you give to the agency by taking the following
steps: (1) Mark each page of the original document submission
containing CBI as ``Confidential''; (2) send PHMSA, along with the
original document, a second copy of the original document with the CBI
deleted; and (3) explain why the information you are submitting is CBI.
Unless you are notified otherwise, PHMSA will treat such marked
submissions as confidential under the FOIA, and they will not be placed
in the public docket of this notice. Submissions containing CBI should
be sent to Kay McIver, DOT, PHMSA PHP-80, 1200 New Jersey Avenue SE,
Washington, DC 20590-0001. Any commentary PHMSA receives that is not
specifically designated as CBI will be placed in the public docket for
this matter.

FOR FURTHER INFORMATION CONTACT:
    General: Ms. Kay McIver by telephone at<PHONE_NUMBER>, or by email
at<EMAIL_ADDRESS>    Technical: Mr. Thach Nguyen by telephone at<PHONE_NUMBER>, or by
email at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: PHMSA received a special permit renewal
request from FNG to renew the special permit and to continue the
exemption from 49 CFR 193.2155(b): Structural requirements. Although
the present special permit term ended on May 13, 2019, in accordance
with 49 CFR 190.341(e), the special permit will not expire until final
administrative action on the application for renewal has been taken.
The original special permit was granted to FNG by PHMSA on May 13,
2014. FNG's special permit renewal request, submitted on November 5,
2018, seeks to waive compliance from the requirements in 49 CFR
193.2155(b) that an LNG storage tank must not be located within one (1)
mile from the ends, or \1/4\ mile from the nearest point of an airport
runway, whichever is longer.
    FNG installed one (1) 125,000-barrel (5,250,000 gallons) LNG
storage tank at its existing storage and vaporization site (FNG LNG
Plant) located in Fairbanks, Alaska and includes all ancillary
facilities required to operate the LNG storage tank. The special permit
renewal request includes a design change of the LNG storage tank at the
FNG LNG Plant from a single containment LNG storage tank to a full-
containment LNG storage tank. The secondary containment for the full-
containment LNG storage tank consists of a concrete outer wall around
the primary liquid container, whereas the design for the single
containment LNG storage tank had an outer dike around the LNG storage
tank as secondary containment. The 125,000-barrel full-containment
storage tank was also relocated from the original location of the
single containment tank to better fit the property for setbacks and
other

design parameters. However, the LNG storage tank location is 0.8 miles
from the Metro Field airport in Fairbanks, Alaska.
    The special permit renewal request, proposed special permit with
modified conditions, and Final Environmental Assessment (FEA) for the
FNG LNG storage tank are available for review and public comment in the
Docket No. PHMSA-2013-0181. We invite interested persons to review and
submit comments on the special permit renewal request, special permit
with modified conditions, and FEA in the docket. Please include any
comments on potential safety and environmental impacts that may result
if the special permit is renewed. Comments may include relevant data.
    Before issuing a decision on the special permit renewal request,
PHMSA will evaluate all comments received on or before the comment
closing date. Comments received after the closing date will be
evaluated, if it is possible to do so without incurring additional
expense or delay.
    PHMSA will consider each relevant comment it receives in making a
decision to grant or deny this special permit renewal request.

Alan K. Mayberry,
Associate Administrator for Pipeline Safety.
[FR Doc. 2020-13731 Filed 6-24-20; 8:45 am]
BILLING CODE 4910-60-P