[Federal Register Volume 78, Number 79 (Wednesday, April 24, 2013)]
[Notices]
[Pages 24285-24287]
[FR Doc No: 2013-09628]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69400; File No. SR-C2-2013-016]

Self-Regulatory Organizations; C2 Options Exchange, Incorporated;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Relating to Fees for the BBO Data Feed for C2 Listed Options

April 18, 2013.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on April 5, 2013, C2 Options Exchange, Incorporated (the
``Exchange'' or ``C2'') filed with the Securities and Exchange
Commission (the ``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

    C2 Options Exchange, Incorporated (the ``Exchange'' or ``C2'')
proposes to amend the fee schedule of Market Data Express, LLC
(``MDX''), an affiliate of C2, for the BBO Data Feed for C2 listed
options (``C2 BBO Data Feed'' or ``Data''). The text of the proposed
rule change is available on the Exchange's Web site (http://www.c2exchange.com/Legal/), 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 purpose of the proposed rule change is to amend the fees
charged by MDX for the C2 BBO Data Feed and to make several clarifying
changes to the MDX fee schedule.\3\ The C2 BBO Data Feed is a real-
time, low latency data feed that includes C2 ``BBO data'' and last sale
data.\4\ The BBO and last sale data contained in the C2 BBO Data Feed
is identical to the data that C2 sends to the Options Price Reporting
Authority (``OPRA'') for redistribution to the public.\5\
---------------------------------------------------------------------------

    \3\ The C2 BBO Data Feed and the fees charged by MDX for the C2
BBO Data Feed were established in March 2011. See Securities
Exchange Act Release No. 63996 (March 1, 2011), 76 FR 12386 (March
7, 2011).
    \4\ The BBO Data Feed includes the ``best bid and offer,'' or
``BBO'', consisting of all outstanding quotes and standing orders at
the best available price level on each side of the market, with
aggregate size (``BBO data,'' sometimes referred to as ``top-of-book
data''). Data with respect to executed trades is referred to as
``last sale'' data.
    \5\ The Exchange notes that MDX makes available to Customers the
BBO data and last sale data that is included in the C2 BBO Data Feed
no earlier than the time at which the Exchange sends that data to
OPRA. A ``Customer'' is any entity that receives the C2 BBO Data
Feed directly from MDX's system and then distributes it either
internally or externally to Subscribers. A ``Subscriber'' is a
person (other than an employee of a Customer) that receives the C2
BBO Data Feed from a Customer for its own internal use.
---------------------------------------------------------------------------

    The C2 BBO Data Feed also includes certain data that is not
included in the data sent to OPRA, namely, (i) totals of customer
versus non-customer contracts at the BBO, (ii) All-or-None contingency
orders priced better than or equal to the BBO, (iii) BBO data and last
sale data for complex strategies (e.g., spreads, straddles, buy-writes,
etc.) (``Spread Data''), and (iv) expected opening price (``EOP'') and
expected opening size (``EOS'') information that is disseminated prior
to the opening of the market and during trading rotations
(collectively, ``EOP/EOS data'').\6\
---------------------------------------------------------------------------

    \6\ The Exchange identified the inclusion of EOP/EOS data in the
C2 BBO Data Feed in a proposed rule change filed in January 2013.
See Securities Exchange Act Release No. 68697 (January 18, 2013), 78
FR 5523 (January 25, 2013).
---------------------------------------------------------------------------

    MDX currently charges Customers a ``direct connect fee'' of $1,000
per connection per month and a ``per user fee'' of $25 per month per
``Authorized User'' or ``Device'' for receipt of the C2 BBO Data Feed
by Subscribers.\7\ Either a C2 Permit Holder or a non-C2 Permit Holder
may be a Customer. All Customers are assessed the same fees.
---------------------------------------------------------------------------

    \7\ An ``Authorized User'' is defined as an individual user (an
individual human being) who is uniquely identified (by user ID and
confidential password or other unambiguous method reasonably
acceptable to MDX) and authorized by a Customer to access the C2 BBO
Data Feed supplied by the Customer. A ``Device'' is defined as any
computer, workstation or other item of equipment, fixed or portable,
that receives, accesses and/or displays data in visual, audible or
other form.
---------------------------------------------------------------------------

    The Exchange proposes to eliminate both the direct connect fee and
the per user fee and replace them with a ``data fee'', payable by a
Customer, of $1,000 per month for internal use and external
redistribution of the C2 BBO Data Feed. A ``Customer'' is any entity
that receives the C2 BBO Data Feed directly from MDX's system or
through a connection to MDX provided by an approved redistributor
(i.e., a market data vendor or an extranet service provider) and then
distributes it internally and/or externally. The data fee would entitle
a Customer to provide the C2 BBO Data Feed to an unlimited number of
internal users and Devices within the Customer. The data fee would also
entitle a Customer to distribute externally the C2 BBO Data Feed to
other Customers. A Customer receiving the C2 BBO Data Feed from another
Customer would be assessed the data fee by MDX and would be entitled to
distribute the data internally and/or externally.\8\ All Customers
would have the same rights to utilize the Data (i.e., distribute the
Data internally and/or externally) as long as the Customer has entered
into an agreement with MDX for the Data and pays the data fee. Either a
C2 Permit Holder or a non-C2 Permit Holder may be a Customer.
---------------------------------------------------------------------------

    \8\ A Customer may choose to receive the Data from another
Customer rather than directly from MDX's system because it does not
want to or is not equipped to manage the technology necessary to
establish a direct connection to MDX. In addition, a Customer is not
subject to the MDX Port Fee if it does not establish a port
connection to an MDX server.
---------------------------------------------------------------------------

    The Exchange also proposes to make several clarifying changes to
the MDX fee schedule. MDX charges Customers a monthly fee of $500 for
each port connection to MDX to receive the C2

BBO Data Feed (``Port Fee'').\9\ The Exchange proposes to move the Port
Fee into a new section of the MDX fee schedule called Systems Fees. The
Exchange proposes to add a description of the Port Fee to the
Definitions section of the MDX fee schedule. The Exchange proposes to
clarify that MDX will not charge the data fee or the Port Fee for any
calendar month in which a Customer commences receipt of Data after the
15th day of the month or discontinues receipt of the Data before the
15th day of the month. The Exchange also proposes to include in the MDX
fee schedule provisions relating to invoicing and late payments.
Lastly, the Exchange proposes to remove the definition of per user fee
from the MDX fee schedule consistent with the elimination of that fee.
---------------------------------------------------------------------------

    \9\ See Securities Exchange Act Release No. 66487 (February 28,
2012), 77 FR 13165 (March 5, 2012).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the requirements of Section 6(b) of the Securities Exchange Act of
1934 (``Act'')\10\ in general, and, in particular, with Section 6(b)(4)
of the Act \11\ in that it provides for the equitable allocation of
reasonable dues, fees and other charges among users and recipients of
the Data, and with Section 6(b)(5) \12\ of the Act in that it is not
designed to permit unfair discrimination between them. The Exchange
believes the proposed data fee is equitable and not unfairly
discriminatory because it would apply equally to all Customers. All
Customers would have the same rights to utilize the Data (i.e.,
distribute the Data internally and/or externally) as long as the
Customer has entered into an agreement with MDX for the Data and pays
the data fee.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(4).
    \12\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes the proposed fee is reasonable because it
compares favorably to fees that other markets charge for similar
products. For example, the Exchange believes NASDAQ OMX PHLX charges
Internal Distributors a monthly fee of $4,000 per organization and
External Distributors a monthly fee of $5,000 per organization for its
``TOPO Plus Orders'' data feed, which like the C2 BBO Data Feed
includes top-of-book data (including orders, quotes and trades) and
other market data. The International Securities Exchange offers a ``Top
Quote Feed'', which includes top-of-book data, and a separate ``Spread
Feed'', which like the C2 BBO Data Feed includes order and quote data
for complex strategies. The Exchange believes ISE charges distributors
of its Top Quote Feed a base monthly fee of $3,000 and distributors of
its Spread Feed a base monthly fee of $3,000. The Exchange notes that
the C2 BBO Data Feed also competes with products offered by the NYSE
entitled NYSE ArcaBook for Amex Options and NYSE ArcaBook for Arca
Options that include top-of-book and last sale data similar to the data
in the C2 BBO Data Feed. As noted above, the C2 BBO Data Feed also
includes EOP/EOS data as well as other data.
    For the reasons cited above, the Exchange believes the proposed fee
for the C2 BBO Data Feed is equitable, reasonable and not unfairly
discriminatory. In addition, the Exchange believes that no substantial
countervailing basis exists to support a finding that the proposed
terms and fee for the C2 BBO Data Feed fails to meet the requirements
of the Act.

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

    C2 does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. To the contrary, the market for
options orders and executions is already highly competitive and the
Exchange's proposal is itself pro-competitive as described below.
    The Exchange believes competition provides an effective constraint
on the market data fees that the Exchange, through MDX, has the ability
and the incentive to charge. C2 has a compelling need to attract order
flow from market participants in order to maintain its share of trading
volume. This compelling need to attract order flow imposes significant
pressure on C2 to act reasonably in setting its fees for market data,
particularly given that the market participants that will pay such fees
often will be the same market participants from whom C2 must attract
order flow. These market participants include broker-dealers that
control the handling of a large volume of customer and proprietary
order flow. Given the portability of order flow from one exchange to
another, any exchange that sought to charge unreasonably high data fees
would risk alienating many of the same customers on whose orders it
depends for competitive survival. C2 currently competes with ten
options exchanges (including C2's affiliate, Chicago Board Options
Exchange) for order flow.\13\
---------------------------------------------------------------------------

    \13\ The Commission has previously made a finding that the
options industry is subject to significant competitive forces. See
e.g., Securities Exchange Act Release No. 59949 (May 20, 2009), 74
FR 25593 (May 28, 2009) (SR-ISE-2009-97) (order approving ISE's
proposal to establish fees for a real-time depth of market data
offering).
---------------------------------------------------------------------------

    C2 is constrained in pricing the C2 BBO Data Feed by the
availability to market participants of alternatives to purchasing the
C2 BBO Data Feed. C2 must consider the extent to which market
participants would choose one or more alternatives instead of
purchasing the exchange's data. For example, the BBO data and last sale
data available in the C2 BBO Data Feed is included in the OPRA data
feed. The OPRA data is widely distributed and relatively inexpensive,
thus constraining C2's ability to price the C2 BBO Data Feed. In this
respect, the OPRA data feed, which includes the exchange's transaction
information, is a significant alternative to the C2 BBO Data Feed
product.
    Further, other options exchanges can and have produced their own
top-of-book products, and thus are sources of potential competition for
MDX. As noted above, NASDAQ OMX PHLX, ISE and NYSE offer market data
products that compete with the C2 BBO Data Feed. In addition, the
Exchange believes other options exchanges may currently offer top-of-
book market data products for a fee or for free.
    The Exchange believes that the C2 BBO Data Feed offered by MDX will
help attract new users and new order flow to the Exchange, thereby
improving the Exchange's ability to compete in the market for options
order flow and executions.

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)(ii) of the Act.\14\ 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.
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

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-C2-2013-016 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-C2-2013-016. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make publicly available. All
submissions should refer to File Number SR-C2-2013-016 and should be
submitted on or before May 15, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-09628 Filed 4-23-13; 8:45 am]
BILLING CODE 8011-01-P


clearing of security-based swaps executed on the security-based swap
execution facility, and ongoing fulfillment of all of the security-
based swap execution facility's responsibilities and obligations with
respect to such security-based swaps, in the event that a disruption
renders the security-based swap execution facility

temporarily or permanently unable to satisfy this requirement on its
own behalf.
    (5) A security-based swap execution facility shall notify
Commission staff promptly of all:
    (i) Electronic trading halts and material system malfunctions;
    (ii) Cyber-security incidents or targeted threats that actually or
potentially jeopardize automated system operation, reliability,
security, or capacity; and
    (iii) Activations of the security-based swap execution facility's
business continuity-disaster recovery plan.
    (6) A security-based swap execution facility shall provide
Commission staff timely advance notice of all material:
    (i) Planned changes to automated systems that may impact the
reliability, security, or adequate scalable capacity of such systems;
and
    (ii) Planned changes to the security-based swap execution
facility's program of risk analysis and oversight.
    (7) As part of a security-based swap execution facility's
obligation to produce books and records in accordance with Core
Principle 9 and Sec.  242.826, the security-based swap execution
facility shall provide to the Commission the following system-
safeguards-related books and records, promptly upon the request of any
Commission representative:
    (i) Current copies of its business continuity-disaster recovery
plans and other emergency procedures;
    (ii) All assessments of its operational risks or system safeguards-
related controls;
    (iii) All reports concerning system safeguards testing and
assessment required by this chapter, whether performed by independent
contractors or by employees of the security-based swap execution
facility; and
    (iv) All other books and records requested by Commission staff in
connection with Commission oversight of system safeguards pursuant to
the Act or Commission rules, or in connection with Commission
maintenance of a current profile of the security-based swap execution
facility's automated systems.
    (v) Nothing in paragraph (b)(7) of this section shall be
interpreted as reducing or limiting in any way a security-based swap
execution facility's obligation to comply with Core Principle 9 and
Sec.  242.826.
    (8) A security-based swap execution facility shall conduct regular,
periodic, objective testing and review of its automated systems to
ensure that they are reliable, secure, and have adequate scalable
capacity. A security-based swap execution facility shall also conduct
regular, periodic testing and review of its business continuity-
disaster recovery capabilities. Such testing and review shall include,
without limitation, all of the types of testing set forth in this
paragraph (b)(8).
    (i) Definitions. As used in this paragraph (b)(8):
    Controls means the safeguards or countermeasures employed by the
security-based swap execution facility to protect the reliability,
security, or capacity of its automated systems or the confidentiality,
integrity, and availability of its data and information, and to enable
the security-based swap execution facility to fulfill its statutory and
regulatory responsibilities.
    Controls testing means assessment of the security-based swap
execution facility's controls to determine whether such controls are
implemented correctly, are operating as intended, and are enabling the
security-based swap execution facility to meet the requirements of this
section.
    Enterprise technology risk assessment means a written assessment
that includes, but is not limited to, an analysis of threats and
vulnerabilities in the context of mitigating controls. An enterprise
technology risk assessment identifies, estimates, and prioritizes risks
to security-based swap execution facility operations or assets, or to
market participants, individuals, or other entities, resulting from
impairment of the confidentiality, integrity, and availability of data
and information or the reliability, security, or capacity of automated
systems.
    External penetration testing means attempts to penetrate the
security-based swap execution facility's automated systems from outside
the systems' boundaries to identify and exploit vulnerabilities.
Methods of conducting external penetration testing include, but are not
limited to, methods for circumventing the security features of an
automated system.
    Internal penetration testing means attempts to penetrate the
security-based swap execution facility's automated systems from inside
the systems' boundaries, to identify and exploit vulnerabilities.
Methods of conducting internal penetration testing include, but are not
limited to, methods for circumventing the security features of an
automated system.
    Security incident means a cybersecurity or physical security event
that actually jeopardizes or has a significant likelihood of
jeopardizing automated system operation, reliability, security, or
capacity, or the availability, confidentiality or integrity of data.
    Security incident response plan means a written plan documenting
the security-based swap execution facility's policies, controls,
procedures, and resources for identifying, responding to, mitigating,
and recovering from security incidents, and the roles and
responsibilities of its management, staff, and independent contractors
in responding to security incidents. A security incident response plan
may be a separate document or a business continuity-disaster recovery
plan section or appendix dedicated to security incident response.
    Security incident response plan testing means testing of a
security-based swap execution facility's security incident response
plan to determine the plan's effectiveness, identify its potential
weaknesses or deficiencies, enable regular plan updating and
improvement, and maintain organizational preparedness and resiliency
with respect to security incidents. Methods of conducting security
incident response plan testing may include, but are not limited to,
checklist completion, walk-through or table-top exercises, simulations,
and comprehensive exercises.
    Vulnerability testing means testing of a security-based swap
execution facility's automated systems to determine what information
may be discoverable through a reconnaissance analysis of those systems
and what vulnerabilities may be present on those systems.
    (ii) Vulnerability testing. A security-based swap execution
facility shall conduct vulnerability testing of a scope sufficient to
satisfy the requirements set forth in paragraph (b)(10) of this
section.
    (A) A security-based swap execution facility shall conduct such
vulnerability testing at a frequency determined by an appropriate risk
analysis.
    (B) Such vulnerability testing shall include automated
vulnerability scanning, which shall follow generally accepted best
practices.
    (C) A security-based swap execution facility shall conduct
vulnerability testing by engaging independent contractors or by using
employees of the security-based swap execution facility who are not
responsible for development or operation of the systems or capabilities
being tested.
    (iii) External penetration testing. A security-based swap execution
facility shall conduct external penetration testing of a scope
sufficient to satisfy the requirements set forth in paragraph (b)(10)
of this section.
    (A) A security-based swap execution facility shall conduct such
external penetration testing at a frequency

determined by an appropriate risk analysis.
    (B) A security-based swap execution facility shall conduct external
penetration testing by engaging independent contractors or by using
employees of the security-based swap execution facility who are not
responsible for development or operation of the systems or capabilities
being tested.
    (iv) Internal penetration testing. A security-based swap execution
facility shall conduct internal penetration testing of a scope
sufficient to satisfy the requirements set forth in paragraph (b)(10)
of this section.
    (A) A security-based swap execution facility shall conduct such
internal penetration testing at a frequency determined by an
appropriate risk analysis.
    (B) A security-based swap execution facility shall conduct internal
penetration testing by engaging independent contractors, or by using
employees of the security-based swap execution facility who are not
responsible for development or operation of the systems or capabilities
being tested.
    (v) Controls testing. A security-based swap execution facility
shall conduct controls testing of a scope sufficient to satisfy the
requirements set forth in paragraph (b)(10) of this section.
    (A) A security-based swap execution facility shall conduct controls
testing, which includes testing of each control included in its program
of risk analysis and oversight, at a frequency determined by an
appropriate risk analysis. Such testing may be conducted on a rolling
basis.
    (B) A security-based swap execution facility shall conduct controls
testing by engaging independent contractors or by using employees of
the security-based swap execution facility who are not responsible for
development or operation of the systems or capabilities being tested.
    (vi) Security incident response plan testing. A security-based swap
execution facility shall conduct security incident response plan
testing sufficient to satisfy the requirements set forth in paragraph
(b)(10) of this section.
    (A) A security-based swap execution facility shall conduct such
security incident response plan testing at a frequency determined by an
appropriate risk analysis.
    (B) A security-based swap execution facility's security incident
response plan shall include, without limitation, the security-based
swap execution facility's definition and classification of security
incidents, its policies and procedures for reporting security incidents
and for internal and external communication and information sharing
regarding security incidents, and the hand-off and escalation points in
its security incident response process.
    (C) A security-based swap execution facility may coordinate its
security incident response plan testing with other testing required by
this section or with testing of its other business continuity-disaster
recovery and crisis management plans.
    (D) A security-based swap execution facility may conduct security
incident response plan testing by engaging independent contractors or
by using employees of the security-based swap execution facility.
    (vii) Enterprise technology risk assessment. A security-based swap
execution facility shall conduct enterprise technology risk assessment
of a scope sufficient to satisfy the requirements set forth in
paragraph (b)(10) of this section.
    (A) A security-based swap execution facility shall conduct
enterprise technology risk assessment at a frequency determined by an
appropriate risk analysis. A security-based swap execution facility
that has conducted an enterprise technology risk assessment that
complies with this section may conduct subsequent assessments by
updating the previous assessment.
    (B) A security-based swap execution facility may conduct enterprise
technology risk assessments by using independent contractors or
employees of the security-based swap execution facility who are not
responsible for development or operation of the systems or capabilities
being assessed.
    (9) To the extent practicable, a security-based swap execution
facility shall:
    (i) Coordinate its business continuity-disaster recovery plan with
those of its members that it depends upon to provide liquidity, in a
manner adequate to enable effective resumption of activity in its
markets following a disruption causing activation of the security-based
swap execution facility's business continuity-disaster recovery plan;
    (ii) Initiate and coordinate periodic, synchronized testing of its
business continuity-disaster recovery plan with those of members that
it depends upon to provide liquidity; and
    (iii) Ensure that its business continuity-disaster recovery plan
takes into account the business continuity-disaster recovery plans of
its telecommunications, power, water, and other essential service
providers.
    (10) The scope for all system safeguards testing and assessment
required by this section shall be broad enough to include the testing
of automated systems and controls that the security-based swap
execution facility's required program of risk analysis and oversight
and its current cybersecurity threat analysis indicate is necessary to
identify risks and vulnerabilities that could enable an intruder or
unauthorized user or insider to:
    (i) Interfere with the security-based swap execution facility's
operations or with fulfillment of its statutory and regulatory
responsibilities;
    (ii) Impair or degrade the reliability, security, or adequate
scalable capacity of the security-based swap execution facility's
automated systems;
    (iii) Add to, delete, modify, exfiltrate, or compromise the
integrity of any data related to the security-based swap execution
facility's regulated activities; or
    (iv) Undertake any other unauthorized action affecting the
security-based swap execution facility's regulated activities or the
hardware or software used in connection with those activities.
    (11) Both the senior management and the governing board of a
security-based swap execution facility shall receive and review reports
setting forth the results of the testing and assessment required by
this section. A security-based swap execution facility shall establish
and follow appropriate procedures for the remediation of issues
identified through such review, as provided in paragraph (b)(12) of
this section, and for evaluation of the effectiveness of testing and
assessment protocols.
    (12) A security-based swap execution facility shall identify and
document the vulnerabilities and deficiencies in its systems revealed
by the testing and assessment required by this section. The security-
based swap execution facility shall conduct and document an appropriate
analysis of the risks presented by such vulnerabilities and
deficiencies, to determine and document whether to remediate or accept
the associated risk. When the security-based swap execution facility
determines to remediate a vulnerability or deficiency, it must
remediate in a timely manner given the nature and magnitude of the
associated risk.

Sec.  242.831   Core Principle 14--Designation of chief compliance
officer.

    (a)(1) In general. Each security-based swap execution facility
shall designate an individual to serve as a chief compliance officer.

    (2) Duties. The chief compliance officer shall:
    (i) Report directly to the board or to the senior officer of the
facility;
    (ii) Review compliance with the core principles in this subsection;
    (iii) In consultation with the board of the facility, a body
performing a function similar to that of a board, or the senior officer
of the facility, resolve any conflicts of interest that may arise;
    (iv) Be responsible for establishing and administering the policies
and procedures required to be established pursuant to this section;
    (v) Ensure compliance with the Act and the rules and regulations
issued under the Act, including rules prescribed by the Commission
pursuant to section 3D of the Act; and
    (vi) Establish procedures for the remediation of noncompliance
issues found during compliance office reviews, look backs, internal or
external audit findings, self-reported errors, or through validated
complaints; and
    (vii) Establish and follow appropriate procedures for the handling,
management response, remediation, retesting, and closing of
noncompliance issues.
    (3) Annual reports--(i) In general. In accordance with rules
prescribed by the Commission, the chief compliance officer shall
annually prepare and sign a report that contains a description of:
    (A) The compliance of the security-based swap execution facility
with the Act; and
    (B) The policies and procedures, including the code of ethics and
conflict of interest policies, of the security-based swap execution
facility.
    (ii) [Reserved]
    (4) Requirements. The chief compliance officer shall:
    (i) Submit each report described in paragraph (a)(3) of this
section with the appropriate financial report of the security-based
swap execution facility that is required to be submitted to the
Commission pursuant to this section; and
    (ii) Include in the report a certification that, under penalty of
law, the report is accurate and complete.
    (b) Authority of chief compliance officer. (1) The position of
chief compliance officer shall carry with it the authority and
resources to develop, in consultation with the governing board or
senior officer, the policies and procedures of the security-based swap
execution facility and enforce such policies and procedures to fulfill
the duties set forth for chief compliance officers in the Act and the
Commission's rules thereunder.
    (2) The chief compliance officer shall have supervisory authority
over all staff acting at the direction of the chief compliance officer.
    (c) Qualifications of chief compliance officer. (1) The individual
designated to serve as chief compliance officer shall have the
background and skills appropriate for fulfilling the responsibilities
of the position.
    (2) No individual that would be disqualified from serving on a
security-based swap execution facility's governing board or committees
pursuant to the criteria set forth in Sec.  242.819(i) may serve as a
chief compliance officer.
    (3) In determining whether the background and skills of a potential
chief compliance officer are appropriate for fulfilling the
responsibilities of the role of the chief compliance officer, a
security-based swap execution facility has the discretion to base its
determination on the totality of the qualifications of the potential
chief compliance officer, including, but not limited to, compliance
experience, related career experience, training, potential conflicts of
interest, and any other relevant factors to the position.
    (d) Appointment and removal of chief compliance officer. (1) Only
the governing board or the senior officer may appoint or remove the
chief compliance officer.
    (2) The security-based swap execution facility shall notify the
Commission within two business days of the appointment or removal,
whether interim or permanent, of a chief compliance officer.
    (e) Compensation of the chief compliance officer. The governing
board or the senior officer shall approve the compensation of the chief
compliance officer.
    (f) Annual meeting with the chief compliance officer. The chief
compliance officer shall meet with the governing board or senior
officer of the security-based swap execution facility at least
annually.
    (g) Information requested of the chief compliance officer. The
chief compliance officer shall provide any information regarding the
regulatory program of the security-based swap execution facility as
requested by the governing board or the senior officer.
    (h) Duties of chief compliance officer. The duties of the chief
compliance officer shall include, but are not limited to, the
following:
    (1) Overseeing and reviewing compliance of the security-based swap
execution facility with section 3D of the Act and the Commission rules
thereunder;
    (2) Taking reasonable steps, in consultation with the governing
board or the senior officer of the security-based swap execution
facility, to resolve any material conflicts of interest that may arise,
including, but not limited to:
    (i) Conflicts between business considerations and compliance
requirements;
    (ii) Conflicts between business considerations and the requirement
that the security-based swap execution facility provide fair, open, and
impartial access as set forth in Sec.  242.819(c); and
    (iii) Conflicts between a security-based swap execution facility's
management and members of the governing board;
    (3) Establishing and administering written policies and procedures
reasonably designed to prevent violations of the Act and the rules of
the Commission;
    (4) Taking reasonable steps to ensure compliance with the Act and
the rules of the Commission;
    (5) Establishing procedures reasonably designed to handle, respond,
remediate, retest, and resolve noncompliance issues identified by the
chief compliance officer through any means, including any compliance
office review, look-back, internal or external audit finding, self-
reported error, or validated complaint;
    (6) Establishing and administering a compliance manual designed to
promote compliance with the applicable laws, rules, and regulations and
a written code of ethics for the security-based swap execution facility
designed to prevent ethical violations and to promote honesty and
ethical conduct by personnel of the security-based swap execution
facility;
    (7) Supervising the regulatory program of the security-based swap
execution facility with respect to trade practice surveillance; market
surveillance; real-time market monitoring; compliance with audit trail
requirements; enforcement and disciplinary proceedings; audits,
examinations, and other regulatory responsibilities (including taking
reasonable steps to ensure compliance with, if applicable, financial
integrity, financial reporting, sales practice, recordkeeping, and
other requirements); and
    (8) Supervising the effectiveness and sufficiency of any regulatory
services provided to the security-based swap execution facility by a
regulatory service provider in accordance with Sec.  242.819(e).
    (i) Preparation of annual compliance report. The chief compliance
officer shall, not less than annually, prepare and sign an annual
compliance report that covers the prior fiscal year. The report shall,
at a minimum, contain:

    (1) A description and self-assessment of the effectiveness of the
written policies and procedures of the security-based swap execution
facility, including the code of ethics and conflict of interest
policies, to reasonably ensure compliance with the Act and applicable
Commission rules;
    (2) Any material changes made to compliance policies and procedures
during the coverage period for the report and any areas of improvement
or recommended changes to the compliance program;
    (3) A description of the financial, managerial, and operational
resources set aside for compliance with the Act and applicable
Commission rules;
    (4) Any material non-compliance matters identified and an
explanation of the corresponding action taken to resolve such non-
compliance matters; and
    (5) A certification by the chief compliance officer that, to the
best of their knowledge and reasonable belief, and under penalty of
law, the annual compliance report is accurate and complete in all
material respects.
    (j) Submission of annual compliance report and related matters--(1)
Furnishing the annual compliance report prior to submission to the
Commission. Prior to submission to the Commission, the chief compliance
officer shall provide the annual compliance report for review to the
governing board or, in the absence of a governing board, to the senior
officer. Members of the governing board and the senior officer shall
not require the chief compliance officer to make any changes to the
report.
    (2) Submission of annual compliance report to the Commission. The
annual compliance report shall be submitted electronically to the
Commission using the EDGAR system as an Interactive Data File in
accordance with Sec.  232.405 not later than 90 calendar days after the
end of the security-based swap execution facility's fiscal year. The
security-based swap execution facility shall concurrently file the
annual compliance report with the fourth-quarter financial report
pursuant to Sec.  242.829(g).
    (3) Amendments to annual compliance report. (i) Promptly upon
discovery of any material error or omission made in a previously filed
annual compliance report, the chief compliance officer shall file an
amendment with the Commission to correct the material error or
omission. The chief compliance officer shall submit the amended annual
compliance report to the governing board, or in the absence of a
governing board, to the senior officer, pursuant to paragraph (j)(1) of
this section.
    (ii) An amendment shall contain the certification required under
paragraph (i)(5) of this section.
    (4) Request for extension. A security-based swap execution facility
may request an extension of time to file its annual compliance report
from the Commission. Reasonable and valid requests for extensions of
the filing deadline may be granted at the discretion of the Commission.
    (k) Recordkeeping. A security-based swap execution facility shall
maintain all records demonstrating compliance with the duties of the
chief compliance officer and the preparation and submission of annual
compliance reports consistent with Core Principle 9 and Sec.  242.826.

Sec.  242.832   Application of the trade execution requirement to
cross-border security-based swap transactions.

    (a) The trade execution requirement set forth in section 3C(h) of
the Act shall not apply in connection with a security-based swap unless
at least one counterparty to the security-based swap is a ``covered
person'' as defined below in paragraph (b) of this rule.
    (b) A ``covered person'' means, with respect to a particular
security-based swap, any person that is:
    (1) A U.S. person;
    (2) A non-U.S. person whose performance under a security-based swap
is guaranteed by a U.S. person; or
    (3) A non-U.S. person who, in connection with its security-based
swap dealing activity, uses U.S. personnel located in a U.S. branch or
office, or personnel of an agent of such non-U.S. person located in a
U.S. branch or office, to arrange, negotiate, or execute a transaction.

Sec.  242.833   Cross-border exemptions.

    (a) Exemptions for foreign trading venues for security-based swaps.
An application for an order for exemptive relief under section 36(a)(1)
of the Act (15 U.S.C. 78mm(a)(1)) relating to the registration status
under the Act of a foreign trading venue for security-based swaps that
has one or more members who are covered persons, as defined in Sec.
242.832, with respect to security-based swaps transacted on that venue
may state that the application also is submitted pursuant to this
paragraph (a). In such case, the Commission will consider the
submission as an application to exempt the foreign trading venue, with
respect to its providing a market place for security-based swaps, from:
    (1) The definition of ``exchange'' in section 3(a)(1) of the Act
(15 U.S.C. 78c(a)(1));
    (2) The definition of ``security-based swap execution facility'' in
section 3(a)(77) of the Act (15 U.S.C. 78c(a)(77));
    (3) The definition of ``broker'' in section 3(a)(4) of the Act (15
U.S.C. 78c(a)(4)); and
    (4) Section 3D(a)(1) of the Act (15 U.S.C. 78c-4(a)(1)).
    (b) Exemptions relating to the trade execution requirement. (1) An
application for an order for exemptive relief under section 36(a)(1) of
the Act (15 U.S.C. 78mm(a)(1)) relating to the application of the trade
execution requirement in section 3C(h) of the Act (15 U.S.C. 78c-3(h))
to security-based swaps executed on a foreign trading venue, may state
that the application also is submitted pursuant to this paragraph (b).
    (2) When considering an application under section 36 of the Act (15
U.S.C. 78mm) and this paragraph (b), the Commission may consider:
    (i) The extent to which the security-based swaps traded in the
foreign jurisdiction covered by the request are subject to a trade
execution requirement comparable to that in section 3C(h) of the Act
(15 U.S.C. 78c-3(h)) and the Commission's rules thereunder;
    (ii) The extent to which trading venues in the foreign jurisdiction
covered by the request are subject to regulation and supervision
comparable to that under the Act, including section 3D of the Act (15
U.S.C. 78c-4), and the Commission's rules thereunder;
    (iii) Whether the foreign trading venue or venues where covered
persons, as defined in Sec.  242.832, intend to trade security-based
swaps have received an exemption order contemplated by paragraph (a) of
this section; and
    (iv) Any other factor that the Commission believes is relevant for
assessing whether the exemption is in the public interest and
consistent with the protection of investors.

Sec.  242.834   Mitigation of conflicts of interest of security-based
swap execution facilities and certain exchanges.

    (a) For purposes of this section:
    Family relationship of a person means the person's spouse, former
spouse, parent, step-parent, child, step-child, sibling, step-brother,
step-sister, grandparent, grandchild, uncle, aunt, nephew, niece, or
in-law.
    Major disciplinary committee means a committee of persons who are
authorized by a security-based swap execution facility to conduct
disciplinary hearings, to settle disciplinary charges, to impose

disciplinary sanctions, or to hear appeals thereof in cases involving
any violation of the rules of the security-based swap execution
facility except those which:
    (i) Are related to decorum or attire, financial requirements, or
reporting or recordkeeping; and
    (ii) Do not involve fraud, deceit, or conversion.
    Member's affiliated firm is a firm in which the member is a
principal or an employee.
    Named party in interest means a person or entity that is identified
by name as a subject of any matter being considered by a governing
board, disciplinary committee, or oversight panel.
    Significant action includes any of the following types of actions
or rule changes by a security-based swap execution facility or SBS
exchange that can be implemented without the Commission's prior
approval:
    (i) Any actions or rule changes which address an emergency; and
    (ii) Any changes in margin levels that are designed to respond to
extraordinary market conditions such as an actual or attempted corner,
squeeze, congestion, or undue concentration of positions, or that
otherwise are likely to have a substantial effect on prices in any
contract traded or cleared at such security-based swap execution
facility or SBS exchange; but does not include any rule not submitted
for prior Commission approval because such rule is unrelated to the
terms and conditions of any security-based swap traded at such
security-based swap execution facility or SBS exchange.
    (b) Each security-based swap execution facility and SBS exchange
shall not permit any of its members, either alone or together with any
officer, principal, or employee of the member, to:
    (1) Own, directly or indirectly, 20 percent or more of any class of
voting securities or of other voting interest in the security-based
swap execution facility or SBS exchange; or
    (2) Directly or indirectly vote, cause the voting of, or give any
consent or proxy with respect to the voting of, any interest that
exceeds 20 percent of the voting power of any class of securities or of
other ownership interest in the security-based swap execution facility
or SBS exchange.
    (c) The rules of each security-based swap execution facility and
SBS exchange must be reasonably designed, and have an effective
mechanism, to:
    (1) Deny effect to the portion of any voting interest held by a
member in excess of the limitations in paragraph (b) of this section;
    (2) Compel a member who possesses a voting interest in excess of
the limitations in paragraph (a) of this section to divest enough of
that voting interest to come within those limitations; and
    (3) Obtain information relating to its ownership and voting
interests owned or controlled, directly or indirectly, by its members.
    (d) Each security-based swap execution facility and SBS exchange
shall ensure that its disciplinary processes preclude any member, or
group or class of its members, from dominating or exercising
disproportionate influence on the disciplinary process. Each major
disciplinary committee or hearing panel thereof shall include
sufficient different groups or classes of its members so as to ensure
fairness and to prevent special treatment or preference for any person
or member in the conduct of the responsibilities of the committee or
panel.
    (e) Each security-based swap execution facility and SBS exchange
shall ensure that:
    (1) 20 percent or more of the persons who are eligible to vote
routinely on matters being considered by the governing board (excluding
those members who are eligible to vote only in the case of a tie vote
by the governing board) are:
    (i) Knowledgeable of security-based swap trading or financial
regulation, or otherwise capable of contributing to governing board
deliberations;
    (ii) Not members of the security-based swap execution facility or
SBS exchange;
    (iii) Not salaried employees of the security-based swap execution
facility or SBS exchange;
    (iv) Not primarily performing services for the security-based swap
execution facility or SBS exchange in a capacity other than as a member
of the governing board; and
    (v) Not officers, principals, or employees of a firm which holds a
membership at the security-based swap execution facility or SBS
exchange, either in its own name or through an employee on behalf of
the firm; and
    (2) The membership of the governing board includes a diversity of
groups or classes of its members. The security-based swap execution
facility or SBS exchange must be able to demonstrate that the board
membership fairly represents the diversity of interests at such
security-based swap execution facility or SBS exchange and is otherwise
consistent with the composition requirements of this section.
    (f) Providing information about the board to the Commission. Each
security-based swap execution facility and SBS exchange shall submit to
the Commission, within 30 days after each governing board election, a
list of the governing board's members, the groups or classes of its
members that they represent, and how the composition of the governing
board otherwise meets the requirements of this section.
    (g) Voting by interested members of governing boards and various
committees of security-based swap execution facilities and SBS
exchanges--(1) Rules required. Each security-based swap execution
facility and SBS exchange shall maintain in effect rules to address the
avoidance of conflicts of interest in the execution of its regulatory
functions. Such rules must provide for the following:
    (i) Relationship with named party in interest--(A) Nature of
relationship. A member of a governing board, disciplinary committee, or
oversight panel of a security-based swap execution facility or SBS
exchange must abstain from such body's deliberations and voting on any
matter involving a named party in interest where such member:
    (1) Is a named party in interest;
    (2) Is an employer, employee, or fellow employee of a named party
in interest;
    (3) Has any other significant, ongoing business relationship with a
named party in interest, not including relationships limited to
executing security-based swaps opposite of each other or to clearing
security-based swaps through the same clearing member; or
    (4) Has a family relationship with a named party in interest.
    (B) Disclosure of relationship. Prior to the consideration of any
matter involving a named party in interest, each member of a governing
board, disciplinary committee, or oversight panel of a security-based
swap execution facility or SBS exchange must disclose to the
appropriate staff of the security-based swap execution facility or SBS
exchange whether they have one of the relationships listed in paragraph
(g)(1)(i)(A) of this section with a named party in interest.
    (C) Procedure for determination. Each security-based swap execution
facility and SBS exchange must establish procedures for determining
whether any member of its governing board, disciplinary committees, or
oversight committees is subject to a conflicts restriction in any
matter involving a

named party in interest. Taking into consideration the exigency of the
committee action, such determinations should be based upon:
    (1) Information provided by the member pursuant to paragraph
(g)(1)(i)(B) of this section; and
    (2) Any other source of information that is held by and reasonably
available to the security-based swap execution facility or SBS
exchange.
    (ii) Financial interest in a significant action--(A) Nature of
interest. A member of the governing board, disciplinary committee, or
oversight panel of a security-based swap execution facility or SBS
exchange must abstain from such body's deliberations and voting on any
significant action if the member knowingly has a direct and substantial
financial interest in the result of the vote based upon either exchange
or non-exchange positions that could reasonably be expected to be
affected by the action.
    (B) Disclosure of interest. Prior to the consideration of any
significant action, each member of a governing board, disciplinary
committee, or oversight panel of a security-based swap execution
facility or SBS exchange must disclose to the appropriate staff of the
security-based swap execution facility or SBS exchange the position
information referred to in paragraph (g)(1)(ii)(C) of this section that
is known to them. This requirement does not apply to members who choose
to abstain from deliberations and voting on the subject significant
action.
    (C) Procedure for determination. Each security-based swap execution
facility and SBS exchange must establish procedures for determining
whether any member of its governing board, disciplinary committees, or
oversight committees is subject to a conflicts restriction under this
section in any significant action. Such determination must include a
review of any positions, whether maintained at that security-based swap
execution facility, SBS exchange, or elsewhere, held in the member's
personal accounts or the proprietary accounts of the member's
affiliated firm that the security-based swap execution facility or SBS
exchange reasonably expects could be affected by the significant
action.
    (D) Bases for determination. Taking into consideration the exigency
of the significant action, such determinations should be based upon:
    (1) Information provided by the member with respect to positions
pursuant to paragraph (f)(2)(ii)(B) of this section; and
    (2) Any other source of information that is held by and reasonably
available to the security-based swap execution facility or SBS
exchange.
    (iii) Participation in deliberations. (A) Under the rules required
by this section, a governing board, disciplinary committee, or
oversight panel of a security-based swap execution facility or SBS
exchange may permit a member to participate in deliberations prior to a
vote on a significant action for which they otherwise would be required
to abstain, pursuant to paragraph (g)(1)(ii) of this section, if such
participation would be consistent with the public interest and the
member recuses from voting on such action.
    (B) In making a determination as to whether to permit a member to
participate in deliberations on a significant action for which they
otherwise would be required to abstain, the deliberating body shall
consider the following factors:
    (1) Whether the member's participation in deliberations is
necessary for the deliberating body to achieve a quorum in the matter;
and
    (2) Whether the member has unique or special expertise, knowledge,
or experience in the matter under consideration.
    (C) Prior to any determination pursuant to paragraph (g)(1)(iii)(A)
of this section, the deliberating body must fully consider the position
information which is the basis for the member's direct and substantial
financial interest in the result of a vote on a significant action
pursuant to paragraph (g)(1)(ii) of this section.
    (iv) Documentation of determination. The governing boards,
disciplinary committees, and oversight panels of each security-based
swap execution facility and SBS exchange must reflect in their minutes
or otherwise document that the conflicts determination procedures
required by this section have been followed. Such records also must
include:
    (A) The names of all members who attended the meeting in person or
who otherwise were present by electronic means;
    (B) The name of any members who voluntarily recused themselves or
were required to abstain from deliberations and/or voting on a matter
and the reason for the recusal or abstention, if stated; and
    (C) Information on the position information that was reviewed for
each member.
    (h) Rules required. (1) A security-based swap execution facility
shall maintain in effect rules to comply with this section that have
been submitted to the Commission pursuant to Sec.  242.806 or Sec.
242.807.
    (2) An SBS exchange shall maintain in effect rules to comply with
this section that have been submitted to the Commission pursuant to
Sec.  240.19b-4 of this chapter.

Sec.  242.835   Notice to Commission by security-based swap execution
facility of final disciplinary action or denial or limitation of
access.

    (a) If a security-based swap execution facility issues a final
disciplinary action against a member, or takes final action with
respect to a denial or conditioning membership, or takes final action
with respect to a denial or limitation of access of a person to any
services offered by the security-based swap execution facility, the
security-based swap execution facility shall file a notice of such
action with the Commission within 30 days and serve a copy on the
affected person.
    (b) For purposes of paragraph (a) of this section:
    (1) A disciplinary action shall not be considered ``final'' unless:
    (i) The affected person has sought an adjudication or hearing with
respect to the matter, or otherwise exhausted their administrative
remedies at the security-based swap execution facility; and
    (ii) The disciplinary action is not a summary action permitted
under Sec.  242.819(g)(13)(ii).
    (2) A disposition of a matter with respect to a denial or
conditioning of membership, or a denial or limitation of access shall
not be considered ``final'' unless such person has sought an
adjudication or hearing, or otherwise exhausted their administrative
remedies at the security-based swap execution facility with respect to
such matter.
    (c) A notice required by paragraph (a) of this section shall
provide the following information:
    (1) The name of the member and its last known address, as reflected
in the security-based swap execution facility's records;
    (2) The name of the person, committee, or other organizational unit
of the security-based swap execution facility that initiated the
disciplinary action or access restriction;
    (3) In the case of a final disciplinary action:
    (i) A description of the acts or practices, or omissions to act,
upon which the sanction is based, including, as appropriate, the
specific rules that the security-based swap execution facility has
found to have been violated;
    (ii) A statement describing the respondent's answer to the charges;
and
    (iii) A statement of the sanction imposed and the reasons therefor;
    (4) In the case of a final action with respect to a denial or
conditioning of

membership, or a denial or limitation of access:
    (i) The financial or operating difficulty of the member or
prospective member (as the case may be) upon which the security-based
swap execution facility determined that the member or prospective
member could not be permitted to do, or continue to do, business with
safety to investors, creditors, other members, or the security-based
swap execution facility;
    (ii) The pertinent failure to meet qualification requirements or
other prerequisites for membership or access and the basis upon which
the security-based swap execution facility determined that the person
concerned could not be permitted to have membership or access with
safety to investors, creditors, other members, or the security-based
swap execution facility; or
    (iii) The default of any delivery of funds or securities to a
clearing agency by the member;
    (5) The effective date of the final disciplinary action, or final
action with respect to a denial or conditioning of membership, or a
denial or limitation of access; and
    (6) Any other information that the security-based swap execution
facility may deem relevant.

PART 249--FORMS, SECURITIES EXCHANGE ACT OF 1934

0
18. The general authority citation for part 249 continues to read in
part as follows:

    Authority:  15 U.S.C. 78a et seq. and 7201 et seq.; 12 U.S.C.
5461 et seq.; 18 U.S.C. 1350; Sec. 953(b), Pub. L. 111-203, 124
Stat. 1904; Sec. 102(a)(3), Pub. L. 112-106, 126 Stat. 309 (2012);
Sec. 107, Pub. L. 112-106, 126 Stat. 313 (2012), Sec. 72001, Pub. L.
114-94, 129 Stat. 1312 (2015), and secs. 2 and 3, Pub. L. 116-222,
134 Stat. 1063 (2020), unless otherwise noted.
* * * * *
0
19. Add Sec.  249.2001 to read as follows:

Sec.  249.2001   Form SBSEF, for application for registration as a
security-based swap execution facility or to amend such application or
registration.

    This form shall be used for application for registration as a
security-based swap execution facility, pursuant to section 3D of the
Securities Exchange Act of 1934 (15 U.S.C. 78c-4) and Sec.  242.803 of
this chapter, or to amend such application or registration.

    By the Commission.

    Dated: April 6, 2022.
Vanessa A. Countryman,
Secretary.

Appendix A

    Note: Form SBSEF will not appear in the Code of Federal
Regulations.
BILLING CODE 8011-01-P

[GRAPHIC] [TIFF OMITTED] TP11MY22.003

[GRAPHIC] [TIFF OMITTED] TP11MY22.004

[GRAPHIC] [TIFF OMITTED] TP11MY22.005

[GRAPHIC] [TIFF OMITTED] TP11MY22.006

[GRAPHIC] [TIFF OMITTED] TP11MY22.007

[GRAPHIC] [TIFF OMITTED] TP11MY22.008

[GRAPHIC] [TIFF OMITTED] TP11MY22.009

[GRAPHIC] [TIFF OMITTED] TP11MY22.010

[GRAPHIC] [TIFF OMITTED] TP11MY22.011

[GRAPHIC] [TIFF OMITTED] TP11MY22.012

Appendix B

0
19. Add Sec.  249.2002 to read as follows:

Sec.  249.2002   Submission cover sheet, for rule and product
submissions.

    This submission cover sheet shall be used by registered security-
based swap execution facilities for making submissions pursuant to
Rules 804 through 807, 809, and 816 (Sec.  242.804 through 242.807,
242.809, and 242.816).
    Note: The submission cover sheet will not appear in the Code of
Federal Regulations.

[GRAPHIC] [TIFF OMITTED] TP11MY22.013

[GRAPHIC] [TIFF OMITTED] TP11MY22.014

[FR Doc. 2022-07850 Filed 5-10-22; 8:45 am]
BILLING CODE 8011-01-C


MEMORANDUM
Subject:	Summary of Meeting with National Wooden Pallet and Container Association (NWPCA) and EPA Office of Air and Radiation (OAR), Office of Air Quality Planning & Standards (OAQPS)
From:		Rochelle Boyd, U.S. EPA, OAR/OAQPS
To:		Docket ID No. EPA-HQ-OAR-2018-0195
I.	Purpose
	To discuss recycled wood pallets to wood pellet fuel issue. (NSPS Regulation)
II.	Place and Date
	The meeting was held via teleconference on October 16, 2019 at 11:00 am EST.
III.	Attendees
	NWPCA Participants
Joe O'Brien, Owner of Industrial Pallet, LLC
Shane Thompson, Westwind Logistics, LLC, Pallet Division President
Billy Hoskins, Vice President Sales and Marketing, Easy Heat Wood Pellets and Board of Directors, Pellet Fuels Institute (PFI)
Don Shandy, Attorney, Crowe & Dunlevy (CHEP/BRAMBLES)
Peter Whitfield, Counsel, Sidley Austin LLP (NWPCA)
Jason Robison, Owner, Conway & Robison
Chris Wiberg, Vice President of Laboratories, TPI
Brent McClendon, President/CEO, NWPCA
Patrick Atagi, Vice President, Advocacy and External Affairs, NWPCA
Dr. Brad Gething, Director of Science and Technology Integration, NWPCA

      EPA Participants
Mike Koerber, OAR/ (OAQPS)
Chuck French, OAR/OAQPS
Rochelle Boyd, OAR/OAQPS
Amanda Aldridge, OAR/OAQPS

IV.	Meeting Agenda
11:00 a.m.          Introductions: NWPCA and EPA (Brent McClendon, President and CEO, NWPCA/ Mike Koerber, Deputy Director, EPA-OAR-OAQPS)
11:10 a.m.          Review of the issue of pallets to pellets in the New Source Performance Standards (NSPS). (NWPCA begins discussion)
11:20 a.m.          EPA  -  Where is NSPS in the review process, timeline for regulations to come out from OMB. Could there be a separate track for the pallet to pellet issue. (EPA)
11:30 a.m.          EPA Response to NWPCA question of pallets to pellets and NSPS regulation. (EPA)
11:35 a.m.          Questions from NWPCA member companies to EPA (NWPCA)
11:50 a.m.          Steps forward (EPA and NWPCA)
Noon                  Conclude


Summary of Capital Returns Site Visit

Site:		Capital Returns

		Milwaukee, Wisconsin

Date:		June 28, 2006

Purpose:	To learn about the reverse distribution system as well as the
generation and management of RCRA hazardous waste at reverse
distributors.

Attendees:

U.S. EPA, Office of Solid Waste

Jessica Biegelson

Lisa Lauer

PharmEcology Associates

Charlotte Smith, President

Capital Returns

Mary Hendrickson, Director of Quality and Regulatory Affairs

To begin the site visit, Mary Hendrickson presented a general overview
of Capital Returns and a process overview of the reverse distribution
model.  We discussed the positive and negative aspects of the possible
addition of pharmaceutical wastes to the universal waste program, as
well the drawbacks of the current RCRA system as it applies to
pharmaceutical wastes.  We then toured the facility which included the
receiving, processing and hazardous wastes storage areas.

RCRA Challenge:

Costumer confusion – an OSHA hazardous drug does not equal a RCRA
hazardous waste

P-listed containers that are empty but are not “RCRA-empty”

Drugs that are “hazardous,” yet are not RCRA hazardous wastes


[Federal Register Volume 86, Number 121 (Monday, June 28, 2021)]
[Notices]
[Pages 34018-34020]
[FR Doc No: 2021-13686]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2020-E-1328]

Determination of Regulatory Review Period for Purposes of Patent
Extension; Smallpox and Monkeypox Vaccine, Live

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA or the Agency) has
determined the regulatory review period for Smallpox and Monkeypox
Vaccine, Live and is publishing this notice of that determination as
required by law. FDA has made the determination because of the
submission of an application to the Director of the U.S. Patent and
Trademark Office (USPTO), Department of Commerce, for the extension of
a patent which claims that human biological product.

DATES: Anyone with knowledge that any of the dates as published (see

SUPPLEMENTARY INFORMATION) are incorrect may submit either electronic
or written comments and ask for a redetermination by August 27, 2021.
Furthermore, any interested person may petition FDA for a determination
regarding whether the applicant for extension acted with due diligence
during the regulatory review period by December 27, 2021. See
``Petitions'' in the SUPPLEMENTARY INFORMATION section for more
information.

ADDRESSES: You may submit comments as follows. Please note that late,
untimely filed comments will not be considered. Electronic comments
must be submitted on or before August 27, 2021. The https://www.regulations.gov electronic filing system will accept comments until
11:59 p.m. Eastern Time at the end of August 27, 2021. Comments
received by mail/hand delivery/courier (for written/paper submissions)
will be considered timely if they are postmarked or the delivery
service acceptance receipt is on or before that date.

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Comments submitted
electronically, including attachments, to https://www.regulations.gov
will be posted to the docket unchanged. Because your comment will be
made public, you are solely responsible for ensuring that your comment
does not include any confidential information that you or a third party
may not wish to be posted, such as medical information, your or anyone
else's Social Security number, or confidential business information,
such as a manufacturing process. Please note that if you include your
name, contact information, or other information that identifies you in
the body of your comments, that information will be posted on https://www.regulations.gov.
     If you want to submit a comment with confidential
information that you do not wish to be made available to the public,
submit the comment as a written/paper submission and in the manner
detailed (see ``Written/Paper Submissions'' and ``Instructions'').

Written/Paper Submissions

    Submit written/paper submissions as follows:
     Mail/Hand delivery/Courier (for written/paper
submissions): Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.
     For written/paper comments submitted to the Dockets
Management Staff, FDA will post your comment, as well as any
attachments, except for information submitted, marked and identified,
as confidential, if submitted as detailed in ``Instructions.''
    Instructions: All submissions received must include the Docket No.
FDA-2020-E-1328 for ``Determination of Regulatory Review Period for
Purposes of Patent Extension; Smallpox and Monkeypox Vaccine, Live.''
Received comments, those filed in a timely manner (see ADDRESSES), will
be placed in the docket and, except for those submitted as
``Confidential Submissions,'' publicly viewable at https://www.regulations.gov or at the Dockets Management Staff between 9 a.m.
and 4 p.m., Monday through Friday,<PHONE_NUMBER>.
     Confidential Submissions--To submit a comment with
confidential information that you do not wish to be made publicly
available, submit your comments only as a written/paper submission. You
should submit two copies total. One copy will include the information
you claim to be confidential with a heading or cover note that states
``THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.'' The Agency will
review this copy, including the claimed confidential information, in
its consideration of comments. The second copy, which will have the
claimed confidential information redacted/blacked out, will be
available for public viewing and posted on https://www.regulations.gov.
Submit both copies to the Dockets Management Staff. If you do not wish
your name and contact information to be made publicly available, you
can provide this information on the cover sheet and not in the body of
your comments and you must identify this information as
``confidential.'' Any information marked as ``confidential'' will not
be disclosed except in accordance with Sec.  10.20 (21 CFR 10.20) and
other applicable disclosure law. For more information about FDA's
posting of comments to public dockets, see 80 FR 56469, September 18,
2015, or access the information at: https://www.govinfo.gov/content/pkg/FR-2015-09-18/pdf/2015-23389.pdf.
    Docket: For access to the docket to read background documents or
the electronic and written/paper comments received, go to https://www.regulations.gov and insert the docket number, found in brackets in
the heading of this document, into the ``Search'' box and follow the
prompts and/or go to the Dockets Management Staff, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852,<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Beverly Friedman, Office of Regulatory
Policy, Food and Drug Administration, 10903 New Hampshire Ave., Bldg.
51, Rm. 6250, Silver Spring, MD 20993,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    The Drug Price Competition and Patent Term Restoration Act of 1984
(Pub. L. 98-417) and the Generic Animal Drug and Patent Term
Restoration Act (Pub. L. 100-670) generally provide that a patent may
be extended for a period of up to 5 years so long as the patented item
(human drug product, animal drug product, medical device, food
additive, or color additive) was subject to regulatory review by FDA
before the item was marketed. Under these acts, a product's regulatory
review period forms the basis for determining the amount of extension
an applicant may receive.
    A regulatory review period consists of two periods of time: A
testing phase and an approval phase. For human biological products, the
testing phase begins when the exemption to permit the clinical
investigations of the biological product becomes effective and runs
until the approval phase begins. The approval phase starts with the
initial submission of an application to market the human biological
product and continues until FDA grants permission to market the
biological product. Although only a portion of a regulatory review
period may count toward the actual amount of extension that the
Director of USPTO may award (for example, half the testing phase must
be subtracted as well as any time that may have occurred before the
patent was issued), FDA's determination of the length of a regulatory
review period for a human biological product will include all of the
testing phase and approval phase as specified in 35 U.S.C.
156(g)(1)(B).
    FDA has approved for marketing the human biologic product Smallpox
and Monkeypox Vaccine, Live (Modified Vaccinia Ankara). Smallpox and
Monkeypox Vaccine, Live, is indicated for prevention of smallpox and
monkeypox disease in adults 18 years of age and older determined to be
at high risk for smallpox or monkeypox infection. Subsequent to this
approval, the USPTO received a patent term restoration application for
Smallpox and Monkeypox Vaccine, Live (U.S. Patent No. 7,335,364) from
Bavarian Nordic A/S, and the USPTO requested FDA's

assistance in determining this patent's eligibility for patent term
restoration. In a letter dated July 14, 2020, FDA advised the USPTO
that this human biological product had undergone a regulatory review
period and that the approval of Smallpox and Monkeypox Vaccine, Live
represented the first permitted commercial marketing or use of the
product. Thereafter, the USPTO requested that FDA determine the
product's regulatory review period.

II. Determination of Regulatory Review Period

    FDA has determined that the applicable regulatory review period for
Smallpox and Monkeypox Vaccine, Live is 5,650 days. Of this time, 5,315
days occurred during the testing phase of the regulatory review period,
while 335 days occurred during the approval phase. These periods of
time were derived from the following dates:
    1. The date an exemption under section 505(i) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355(i)) became effective: April 7,
2004. The applicant claims March 8, 2004, as the date the
investigational new drug application (IND) became effective. However,
FDA records indicate that the IND effective date was April 7, 2004,
which was 30 days after FDA receipt of the IND.
    2. The date the application was initially submitted with respect to
the human biological product under section 351 of the Public Health
Service Act (42 U.S.C. 262): October 25, 2018. FDA has verified the
applicant's claim that the biologics license application (BLA) for
Smallpox and Monkeypox Vaccine, Live (BLA 125678) was initially
submitted on October 25, 2018.
    3. The date the application was approved: September 24, 2019. FDA
has verified the applicant's claim that BLA 125678 was approved on
September 24, 2019.
    This determination of the regulatory review period establishes the
maximum potential length of a patent extension. However, the USPTO
applies several statutory limitations in its calculations of the actual
period for patent extension. In its application for patent extension,
this applicant seeks 1,825 days of patent term extension.

III. Petitions

    Anyone with knowledge that any of the dates as published are
incorrect may submit either electronic or written comments and, under
21 CFR 60.24, ask for a redetermination (see DATES). Furthermore, as
specified in Sec.  60.30 (21 CFR 60.30), any interested person may
petition FDA for a determination regarding whether the applicant for
extension acted with due diligence during the regulatory review period.
To meet its burden, the petition must comply with all the requirements
of Sec.  60.30, including but not limited to: Must be timely (see
DATES), must be filed in accordance with Sec.  10.20, must contain
sufficient facts to merit an FDA investigation, and must certify that a
true and complete copy of the petition has been served upon the patent
applicant. (See H. Rept. 857, part 1, 98th Cong., 2d sess., pp. 41-42,
1984.) Petitions should be in the format specified in 21 CFR 10.30.
    Submit petitions electronically to https://www.regulations.gov at
Docket No. FDA-2013-S-0610. Submit written petitions (two copies are
required) to the Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.

    Dated: June 22, 2021.
Lauren K. Roth,
Acting Principal Associate Commissioner for Policy.
[FR Doc. 2021-13686 Filed 6-25-21; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register Volume 85, Number 15 (Thursday, January 23, 2020)]
[Notices]
[Pages 3929-3931]
[FR Doc No: 2020-01082]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2020-N-0145]

Agency Information Collection Activities; Proposed Collection;
Comment Request; Reporting Associated With Animal Drug and Animal
Generic Drug User Fees

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA or Agency) is announcing
an opportunity for public comment on the proposed collection of certain
information by the Agency. Under the Paperwork Reduction Act of 1995
(PRA), Federal Agencies are required to publish notice in the Federal
Register concerning each proposed collection of information, including
each proposed extension of an existing collection of information, and
to allow 60 days for public comment in response to the notice. This
notice solicits comments on the information collection provisions of
FDA's animal drug and animal generic drug user fee programs.

DATES: Submit either electronic or written comments on the collection
of information by March 23, 2020.

ADDRESSES: You may submit comments as follows. Please note that late,
untimely filed comments will not be considered. Electronic comments
must be submitted on or before March 23, 2020. The https://www.regulations.gov electronic filing system will accept comments until
11:59 p.m. Eastern Time at the end of March 23, 2020. Comments received
by mail/hand delivery/courier (for written/paper submissions) will be
considered timely if they are postmarked or the delivery service
acceptance receipt is on or before that date.

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Comments submitted
electronically, including attachments, to https://www.regulations.gov
will be posted to the docket unchanged. Because your comment will be
made public, you are solely responsible for ensuring that your comment
does not include any confidential information that you or a third party
may not wish to be posted, such as medical information, your or anyone
else's Social Security number, or confidential business information,
such as a manufacturing process. Please note that if you include your
name, contact information, or other information that identifies you in
the body of your comments, that information will be posted on https://www.regulations.gov.
     If you want to submit a comment with confidential
information that you do not wish to be made available to the public,
submit the comment as a written/paper submission and in the manner
detailed (see ``Written/Paper Submissions'' and ``Instructions'').

Written/Paper Submissions

    Submit written/paper submissions as follows:
     Mail/Hand Delivery/Courier (for written/paper
submissions): Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.
     For written/paper comments submitted to the Dockets
Management Staff, FDA will post your comment, as well as any
attachments, except for information submitted, marked and identified,
as confidential, if submitted as detailed in ``Instructions.''
    Instructions: All submissions received must include the Docket No.
FDA-2020-N-0145 for ``Agency Information Collection Activities;
Proposed Collection; Comment Request; Reporting Associated with Animal
Drug and Animal Generic Drug User Fees.'' Received comments, those
filed in a timely manner (see ADDRESSES), will be placed in the docket
and, except for those submitted as ``Confidential Submissions,''
publicly viewable at https://www.regulations.gov or at the Dockets
Management Staff between 9 a.m. and 4 p.m., Monday through Friday.
     Confidential Submissions--To submit a comment with
confidential information that you do not wish to be made publicly
available, submit your comments only as a written/paper submission. You
should submit two copies total. One copy will include the information
you claim to be confidential with a heading or cover note that states
``THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.'' The Agency will
review this copy, including the claimed confidential information, in
its consideration of comments. The second copy, which will have the
claimed confidential information redacted/blacked out, will be
available for public viewing and posted on https://www.regulations.gov.
Submit both copies to the Dockets Management Staff. If you do not wish
your name and contact information to be made publicly available, you
can provide this information on the cover sheet and not in the body of
your comments and you must identify this information as
``confidential.'' Any information marked as ``confidential'' will not
be disclosed except in accordance with 21 CFR 10.20 and other
applicable disclosure law. For more information about FDA's posting of
comments to public dockets, see 80 FR 56469, September 18, 2015, or
access the information at: https://www.govinfo.gov/content/pkg/FR-2015-09-18/pdf/2015-23389.pdf.
    Docket: For access to the docket to read background documents or
the electronic and written/paper comments received, go to https://www.regulations.gov and insert the docket number, found in brackets in
the heading of this document, into the ``Search'' box and follow the
prompts and/or go to the Dockets Management Staff, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Amber Sanford, Office of Operations,
Food and Drug Administration, Three White Flint North, 10A-12M, 11601
Landsdown St., North Bethesda, MD 20852,<PHONE_NUMBER>,
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3521), Federal
Agencies must obtain approval from the Office of Management and Budget
(OMB) for each collection of information they conduct or sponsor.
``Collection of information'' is defined in 44 U.S.C. 3502(3) and 5 CFR
1320.3(c) and includes Agency requests or requirements that members of
the public submit reports, keep records, or provide information to a
third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A))
requires Federal Agencies to provide a 60-day notice in the Federal
Register concerning each proposed collection of information, including
each proposed extension of an existing collection of information,
before submitting the collection to OMB for approval. To comply with
this requirement, FDA is publishing notice of the proposed collection
of information set forth in this document.
    With respect to the following collection of information, FDA
invites comments on these topics: (1) Whether the proposed collection
of information is necessary for the proper performance of FDA's
functions, including whether the information will have practical
utility; (2) the accuracy of FDA's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility, and clarity of the information to be collected; and (4) ways
to minimize the burden of the collection of information on respondents,
including through the use of automated collection techniques, when
appropriate, and other forms of information technology.

Reporting Associated With Animal Drug and Animal Generic Drug User
Fees--21 U.S.C. 379j-12 and 379j-21

OMB Control Numbers 0910-0540--Extension

    This information collection supports FDA's animal drug and animal
generic drug user fee programs. The Animal Drug User Fee Act of 2003
(ADUFA) (Pub. L. 108-130) amended the Federal Food, Drug, and Cosmetic
Act (FD&C Act) by adding section 740 of the FD&C Act (21 U.S.C. 379j-
12), which requires that FDA assess and collect user fees with respect
to new animal drug applications for certain applications, products,
establishments, and sponsors. It also requires the Agency to grant a
waiver from, or a reduction of, those fees in certain circumstances.
The Animal Generic Drug User Fee Act of 2008 (AGDUFA) (Pub. L. 110-316)
added section 741 of the FD&C Act (21 U.S.C. 379j-21), which
establishes three different kinds of user fees: (1) Fees for certain
types of abbreviated applications for generic new animal drugs; (2)
annual fees for certain generic new animal drug products; and (3)
annual fees for certain sponsors of abbreviated applications for
generic new animal drugs and/or investigational submissions for generic
new animal drugs (21 U.S.C. 379j-21(a)). On August 14, 2018, H.R. 5554,
the Animal Drug and Animal Generic Drug User Fee Amendments of 2018,
was signed into law to reauthorize the ADUFA and AGDUFA programs
administered by FDA.
    Sponsors of new animal drug applications prepare and submit user
fee cover sheets. The Animal Drug User Fee cover sheet (Form FDA 3546)
is designed to collect the minimum necessary information to determine
whether a fee is required for the review of an application or
supplement or whether an application fee waiver was granted, to
determine the amount of the fee required, and to ensure that each
animal drug user fee payment is appropriately linked to the animal drug
application for which payment is made. The form, when completed
electronically, results in the generation of a unique payment
identification number used by FDA to track the payment. The information
collected is used by FDA's Center for Veterinary Medicine (CVM) to
initiate the administrative screening of new animal drug applications
and supplements. The information collection associated with the Animal
Drug User Fee cover sheet currently is approved under OMB control
number 0910-0539.
    Sponsors of abbreviated new animal drug applications also prepare
and

submit user fee cover sheets. The Animal Generic Drug User Fee cover
sheet (Form FDA 3728) similarly is designed to collect the minimum
necessary information to determine whether a fee is required for review
of an application, to determine the amount of the fee required, and to
ensure that each animal generic drug user fee payment is appropriately
linked to the abbreviated new animal drug application for which payment
is made. The form, when completed electronically, results in the
generation of a unique payment identification number used by FDA to
track the payment. The information collected is used by CVM to initiate
the administrative screening of abbreviated new animal drug
applications. The information collection associated with the Animal
Generic Drug User Fee cover sheet currently is approved under OMB
control number 0910-0632.
    FDA has also developed a guidance for industry (GFI) #170 entitled
``Animal Drug User Fees and Fee Waivers and Reductions.'' This document
provides guidance on the types of fees FDA is authorized to collect
under section 740 of the FD&C Act, and how to request waivers and
reductions from these fees. Further, this guidance also describes what
information FDA recommends be submitted in support of a request for a
fee waiver or reduction; how to submit such a request; and FDA's
process for reviewing requests. FDA uses the information submitted by
respondents to determine whether to grant the requested fee waiver or
reduction. The information collection associated with GFI #170
currently is approved under OMB control number 0910-0540.
    The information collection provisions approved under OMB control
numbers 0910-0539, 0910-0540, and 0910-0632 are similar in that they
support FDA's animal drug and animal generic drug user fee programs.
Thus, with this notice, FDA proposes to consolidate these collections
of information into one OMB control number for government efficiency
and to allow the public to look to one OMB control number for all
reporting associated with FDA's animal drug and animal generic drug
user fee programs. Because we are proposing to combine all reporting
associated with FDA's animal drug user fees into one collection, we are
consolidating the burden under OMB control number 0910-0540 and
discontinuing OMB control numbers 0910-0539 and 0910-0632.
    Description of Respondents: Respondents to this collection of
information are new animal drug applicants and abbreviated new animal
drug applicants. In addition, requests for waivers or reductions of
user fees may be submitted by a person responsible for paying or
potentially responsible for paying any of the animal drug user fees
assessed, including application fees, product fees, establishment fees,
or sponsor fees.
    FDA estimates the burden of this collection of information as
follows:

                                                     Table 1--Estimated Annual Reporting Burden \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Number of
     FD&C Act Section; Activity             FDA form No.           Number of     responses per   Total annual      Average  burden per      Total hours
                                                                  respondents     respondent       responses            response
--------------------------------------------------------------------------------------------------------------------------------------------------------
User fee cover sheets, by type:
    740(a)(1); Animal Drug User Fee  FDA 3546.................              21               1              21  1.......................              21
     cover sheet.
    741; Animal Generic Drug User    FDA 3728.................              20               2              40  0.08 (5 minutes)........               3
     Fee cover sheet.
Waiver and other requests, by type:
    740(d)(1)(A); significant        N/A......................              55               1              55  2.......................             110
     barrier to innovation.
    740(d)(1)(B); fees exceed cost.  N/A......................               8            3.75              30  0.5 (30 minutes)........              15
    740(d)(1)(C); free-choice feeds  N/A......................               5               1               5  2.......................              10
    740(d)(1)(D); minor use or       N/A......................              69               1              69  2.......................             138
     minor species.
    740(d)(1)(E); small business...  N/A......................               1               1               1  2.......................               2
    Request for reconsideration of   N/A......................               1               1               1  2.......................               2
     a decision.
    Request for review (user fee     N/A......................               1               1               1  2.......................               2
     appeal officer).
                                    --------------------------------------------------------------------------------------------------------------------
        Total......................  .........................  ..............  ..............  ..............  ........................             303
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of information.

    For the purpose of this consolidation, we rely on our previous
estimates of the number of user fee cover sheet and waiver and other
request submissions. We estimate 21 respondents will each submit 1
Animal Drug User Fee cover sheet (Form FDA 3546) for a total of 21
responses. We estimate 20 respondents will each submit 2 Animal Generic
Drug User Fee cover sheets (Form FDA 3728) for a total of 40 responses.
Our estimate of the number of waiver and other request submissions is
detailed in table 1. These estimates are consistent with our previous
estimates except for the row labeled, Request for review (user fee
appeal officer), for which we have increased the estimated number of
respondents from zero to one and the average burden per response from 0
to 2 hours to correct the error in our previous submission. We base our
estimates of the average burden per response on our experience with the
submission of similar cover sheets and waiver and other requests.
    The information collection reflects an increase in burden by an
additional 26 hours and 62 responses due to the consolidation of the
information collections covered by OMB control numbers 0910-0539,
``Animal Drug User Fee Cover Sheet,'' and 0910-0632, ``Animal Generic
Drug User Fee Cover Sheet'' and the correction of the error in our
previous submission.

    Dated: January 14, 2020.
Lowell J. Schiller,
Principal Associate Commissioner for Policy.
[FR Doc. 2020-01082 Filed 1-22-20; 8:45 am]
 BILLING CODE 4164-01-P