[Federal Register Volume 87, Number 178 (Thursday, September 15, 2022)]
[Notices]
[Pages 56686-56687]
[FR Doc No: 2022-19898]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket Nos. FDA-2021-E-0379 and FDA-2021-E-0380]

Determination of Regulatory Review Period for Purposes of Patent
Extension; CAPLYTA

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA or the Agency) has
determined the regulatory review period for CAPLYTA and is publishing
this notice of that determination as required by law. FDA has made the
determination because of the submission of applications 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 drug
product.

DATES: Anyone with knowledge that any of the dates as published (see
SUPPLEMENTARY INFORMATION) are incorrect must submit either electronic
or written comments and ask for a redetermination by November 14, 2022.
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 March 14, 2023. 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. The https://www.regulations.gov electronic filing system will accept comments until
11:59 p.m. Eastern Time at the end of November 14, 2022. Comments
received by mail/hand delivery/courier (for written/paper submissions)
will be considered timely if they are received 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 Nos.
FDA-2021-E-0379 and FDA-2021-E-0380 for ``Determination of Regulatory
Review Period for Purposes of Patent Extension; CAPLYTA.'' 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 numbers, 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 or biologic 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 drug products, the
testing phase begins when the exemption to permit the clinical
investigations of the drug 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 drug product and
continues until FDA grants permission to market the drug 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
drug 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 drug product, CAPLYTA
(lumateperone tosylate). CAPLYTA is indicated for the treatment of
schizophrenia. Subsequent to this approval, the USPTO received a patent
term restoration application for CAPLYTA (U.S. Patent Nos. 8,598,119
and 8,648,077) from Intra-Cellular Therapies, Inc., and the USPTO
requested FDA's assistance in determining the patent's eligibility for
patent term restoration. In a letter dated June 8, 2021, FDA advised
the USPTO that this human drug product had undergone a regulatory
review period and that the approval of CAPLYTA 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
CAPLYTA is 4,421 days. Of this time, 3,970 days occurred during the
testing phase of the regulatory review period, while 451 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 (FD&C Act) (21 U.S.C. 355(i)) became effective:
November 15, 2007. FDA has verified the applicant's claim that the date
the investigational new drug application became effective was on
November 15, 2007.
    2. The date the application was initially submitted with respect to
the human drug product under section 505 of the FD&C Act: September 27,
2018. FDA has verified the applicant's claim that the new drug
application (NDA) for CAPLYTA (NDA 209500) was initially submitted on
September 27, 2018.
    3. The date the application was approved: December 20, 2019. FDA
has verified the applicant's claim that NDA 209500 was approved on
December 20, 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 applications for patent extension,
this applicant seeks 1,294 days or 1,329 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: September 7, 2022.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2022-19898 Filed 9-14-22; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register Volume 83, Number 149 (Thursday, August 2, 2018)]
[Proposed Rules]
[Pages 37768-37770]
[FR Doc No: 2018-16490]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2018-0638; Product Identifier 2018-NM-016-AD]
RIN 2120-AA64

Airworthiness Directives; Viking Air Limited (Type Certificate
Previously Held by Bombardier, Inc.; Canadair Limited) Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: We propose to supersede Airworthiness Directive (AD) 2013-11-
03, which applies to certain Viking Air Limited Model CL-215-1A10 and
CL-215-6B11 (CL-215T Variant) airplanes. AD 2013-11-03 requires
repetitive detailed inspections for cracking of the left-hand (LH) and
right-hand (RH) wing lower skin, and repair if necessary. AD 2013-11-03
was prompted by reports of a fractured wing lower rear spar cap and
reinforcing strap. Since we issued AD 2013-11-03, further analysis has
indicated the need for repetitive eddy current and borescope
inspections. This proposed AD would require repetitive borescope
inspections of the LH and RH wing lower skin and repetitive eddy
current inspections of the LH and RH wing front and rear lower spar
caps. We are proposing this AD to address the unsafe condition on these
products.

DATES: We must receive comments on this proposed AD by September 17,
2018.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: Deliver to Mail address above between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    For service information identified in this NPRM, contact Viking Air
Limited, 1959 de Havilland Way, Sidney, British Columbia V8L 5V5,
Canada; telephone +1-250-656-7227; fax +1-250-656-0673; email [email protected]; internet http://www.vikingair.com. You may view this referenced service information at
the FAA, Transport Standards Branch, 2200 South 216th St., Des Moines,
WA. For information on the availability of this material at the FAA,
call<PHONE_NUMBER>.

Examining the AD Docket

    You may examine the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-
0638; or in person at the Docket Management Facility between 9 a.m. and
5 p.m., Monday through Friday, except Federal holidays. The AD docket
contains this NPRM, the regulatory evaluation, any comments received,
and other information. The street address for the Docket Operations
office (telephone<PHONE_NUMBER>) is in the ADDRESSES section. Comments
will be available in the AD docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Andrea Jimenez, Aerospace Engineer,
Airframe and Mechanical Systems Section, FAA, New York ACO Branch, 1600
Stewart Avenue, Suite 410, Westbury, NY 11590; telephone<PHONE_NUMBER>;
fax<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposal. Send your comments to an address listed
under the ADDRESSES section. Include ``Docket No. FAA-2018-0638;
Product Identifier 2018-NM-016-AD'' at the beginning of your comments.
We specifically invite comments on the overall regulatory, economic,
environmental, and energy aspects of this proposed AD. We will consider
all comments received by the closing date and may amend this proposed
AD based on those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    We issued AD 2013-11-03, Amendment 39-17463 (78 FR 32353, May 30,
2013) (``AD 2013-11-03''), for certain Viking Air Limited Model CL-215-
1A10 and CL-215-6B11 (CL-215T Variant) airplanes. AD 2013-11-03
requires repetitive detailed inspections for cracking of the LH and RH
wing lower skin, and repair if necessary. AD 2013-11-03 resulted from
reports of a fractured wing lower rear spar cap and reinforcing strap.
We issued AD 2013-11-03 to detect and correct cracked wing structure,
which could result in failure of the wing.

Actions Since AD 2013-11-03 Was Issued

    Since we issued AD 2013-11-03, an operator reported damage to the
wing lower skin and rear spar of an airplane. This damage was noticed
95 flight hours after an ultrasonic inspection. Further analysis by the
airplane manufacturer and the FAA has determined that the ultrasonic
inspection might not have been adequate to detect a crack in the spar
cap, and there is a need for repetitive eddy current and borescope
inspections.
    Transport Canada Civil Aviation (TCCA), which is the aviation
authority for Canada, has issued Canadian Airworthiness Directive, CF-
2013-11R1, dated October 30, 2017 (referred to after this as the
Mandatory Continuing Airworthiness Information, or ``the MCAI''), to
correct an unsafe condition for certain Viking Air Limited Model CL-
215-1A10 and CL-215-6B11 (CL-215T Variant) airplanes. The MCAI states:

    While performing modifications on a CL-215-1A10 aeroplane, an
operator discovered that the wing lower rear spar cap and
reinforcing strap were fractured at Wing Stations (WS) 49.5 and 50
respectively and the rear spar web and wing lower skin were also
cracked. It is suspected that a crack initiated at the wing lower
spar cap, leading to its failure, the subsequent failure of the
reinforcing strap and cracking of the spar web and wing lower skin.
The damage was outside of the area addressed by the repetitive
ultrasonic inspections required by [Canadian] AD CF-1992-26R2 [which
corresponds to FAA AD 2012-11-04, Amendment 39-17067 (77 FR 32892,
June 4, 2012)] and was found 95 hours air time after the last
ultrasonic inspection.
    Failure and cracking of the above-noted wing structure, if not
detected, could result in failure of the wing.
    In order to mitigate the unsafe condition, [Canadian] AD CF-
2013-11 [which corresponds to FAA AD 2013-11-03] was released.
However, further analysis has indicated the need for repetitive eddy
current and borescope inspections. Therefore, Revision 1 of this
[Canadian] AD mandates a repetitive detailed inspection of the wing
lower skin using a borescope, changes the one-time eddy current
inspection of the lower front and rear spar caps to a repetitive
inspection and eliminates the one-time detailed inspection with fuel
bladders removed.
    The requirements of [Canadian] AD CF-1992-26R2 remain
applicable.

    You may examine the MCAI in the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-
0638.

Related Service Information Under 1 CFR Part 51

    Bombardier has issued Alert Service Bulletin 215-A558, Revision 3,
dated June 3, 2016. This service information describes procedures for
detecting cracks using repetitive borescope inspections of the LH and
RH wing lower skin and repetitive eddy current inspections of the LH
and RH wing front and rear lower spar caps. This service information is
reasonably available because the interested parties have access to it
through their normal course of business or by the means identified in
the ADDRESSES section.

FAA's Determination and Requirements of This Proposed AD

    This product has been approved by the aviation authority of another
country, and is approved for operation in the United States. Pursuant
to our bilateral agreement with the State of Design Authority, we have
been notified of the unsafe condition described in the MCAI and service
information referenced above. We are proposing this AD because we
evaluated all pertinent information and determined an unsafe condition
exists and is likely to exist or develop on other products of these
same type designs.

Costs of Compliance

    We estimate that this proposed AD affects 4 airplanes of U.S.
registry. We estimate the following costs to comply with this proposed
AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                             Parts                              Cost on U.S.
              Action                      Labor cost          cost      Cost per product          operators
----------------------------------------------------------------------------------------------------------------
Borescope and eddy current          8 work-hours x $85            $0  $680 per inspection   $2,720 per
 inspections.                        per hour = $680 per               cycle.                inspection cycle.
                                     inspection cycle.
----------------------------------------------------------------------------------------------------------------

    We have received no definitive data that would enable us to provide
cost estimates for the on-condition actions specified in this proposed
AD.

Authority for This Rulemaking

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

FAA Order 8000.51C. In accordance with that order, issuance of ADs is
normally a function of the Compliance and Airworthiness Division, but
during this transition period, the Executive Director has delegated the
authority to issue ADs applicable to transport category airplanes to
the Director of the System Oversight Division.

Regulatory Findings

    We determined that this proposed AD would not have federalism
implications under Executive Order 13132. This proposed AD would not
have a substantial direct effect on the States, on the relationship
between the national Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
    For the reasons discussed above, I certify this proposed
regulation:
    1. Is not a ``significant regulatory action'' under Executive Order
12866,
    2. Is not a ``significant rule'' under the DOT Regulatory Policies
and Procedures (44 FR 11034, February 26, 1979),
    3. Will not affect intrastate aviation in Alaska, and
    4. Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

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

The Proposed Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by removing Airworthiness Directive (AD)
2013-11-03, Amendment 39-17463 (78 FR 32353, May 30, 2013), and adding
the following new AD:

Viking Air Limited (Type Certificate Previously Held by Bombardier,
Inc.; Canadair Limited): Docket No. FAA-2018-0638; Product
Identifier 2018-NM-016-AD.

(a) Comments Due Date

    We must receive comments by September 17, 2018.

(b) Affected ADs

    This AD replaces AD 2013-11-03, Amendment 39-17463 (78 FR 32353,
May 30, 2013) (``AD 2013-11-03'').

(c) Applicability

    This AD applies to the Viking Air Limited (Type Certificate
previously held by Bombardier, Inc.; Canadair Limited) airplanes
identified in paragraphs (c)(1) and (c)(2) of this AD, certificated
in any category.
    (1) Model CL-215-1A10 airplanes, serial numbers (S/Ns) 1001
through 1125 inclusive.
    (2) Model CL-215-6B11 (CL-215T Variant) airplanes, S/Ns 1056
through 1125 inclusive.

(d) Subject

    Air Transport Association (ATA) of America Code 57, Wings.

(e) Reason

    This AD was prompted by reports of cracking of the wing lower
skin and rear spar. We are issuing this AD to address cracked wing
structure, which could result in failure of the wing.

(f) Compliance

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

(g) Repetitive Borescope Inspection

    Within 50 flight hours after the effective date of this AD:
Using a borescope, do a detailed inspection for cracking of the
left-hand (LH) and right-hand (RH) wing lower skin between wing
station (WS) 45.00 and 51.00, in accordance with Part A of
Bombardier Alert Service Bulletin 215-A558, Revision 3, dated June
3, 2016. Repeat the inspection thereafter at intervals not to exceed
50 flight hours until the initial eddy current inspection required
by paragraph (h) of this AD has been accomplished. After
accomplishment of the initial eddy current inspection required by
paragraph (h) of this AD, the borescope inspection interval required
by this paragraph may be extended to 300 flight hours.

(h) Repetitive Eddy Current Inspections

    Within 300 flight hours after the effective date of this AD: Do
an eddy current inspection for cracking of the LH and RH wing front
and rear lower spar caps, in accordance with Parts C-1 and C-2 of
Bombardier Alert Service Bulletin 215-A558, Revision 3, dated June
3, 2016. Repeat the inspection thereafter at intervals not to exceed
300 flight hours.

(i) Corrective Actions

    If any crack, as defined in Bombardier Alert Service Bulletin
215-A558, Revision 3, dated June 3, 2016, is found during any
inspection required by paragraph (g) or paragraph (h) of this AD:
Before further flight, repair using a method approved by the FAA; or
Transport Canada Civil Aviation (TCCA); or Viking Air Limited's TCCA
Design Approval Organization (DAO). If approved by the DAO, the
approval must include the DAO-authorized signature.

(j) Credit for Previous Actions

    This paragraph provides credit for the initial inspections
required by paragraphs (g) and (h) of this AD if those actions were
performed before the effective date of this AD using Bombardier
Alert Service Bulletin 215-A558, Revision 1, dated January 10, 2014;
or Bombardier Alert Service Bulletin 215-A558, Revision 2, dated
January 17, 2014.

(k) No Reporting Requirement

    Although Bombardier Alert Service Bulletin 215-A558, Revision 3,
dated June 3, 2016, specifies to submit certain information to the
manufacturer, this AD does not include that requirement.

(l) Other FAA AD Provisions

    (1) Alternative Methods of Compliance (AMOCs): The Manager, New
York ACO Branch, FAA, has the authority to approve AMOCs for this
AD, if requested using the procedures found in 14 CFR 39.19. In
accordance with 14 CFR 39.19, send your request to your principal
inspector or local Flight Standards District Office, as appropriate.
If sending information directly to the manager of the certification
office, send it to ATTN: Program Manager, Continuing Operational
Safety, FAA, New York ACO Branch.
    (2) Contacting the Manufacturer: For any requirement in this AD
to obtain corrective actions from a manufacturer, the action must be
accomplished using a method approved by the Manager, New York ACO
Branch, FAA; or TCCA; or Viking Air Limited's TCCA DAO. If approved
by the DAO, the approval must include the DAO-authorized signature.

(m) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information
(MCAI) Canadian Airworthiness Directive CF-2013-11R1, dated October
30, 2017, for related information. This MCAI may be found in the AD
docket on the internet at http://www.regulations.gov by searching
for and locating Docket No. FAA-2018-0638.
    (2) For more information about this AD, contact Andrea Jimenez,
Aerospace Engineer, Airframe and Mechanical Systems Section, FAA,
New York ACO Branch, 1600 Stewart Avenue, Suite 410, Westbury, NY
11590; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>.
    (3) For service information identified in this AD, contact
Viking Air Limited, 1959 de Havilland Way, Sidney, British Columbia
V8L 5V5, Canada; telephone +1-250-656-7227; fax +1-250-656-0673;
email [email protected]; internet http://www.vikingair.com. You may view this service information at the FAA,
Transport Standards Branch, 2200 South 216th St., Des Moines, WA.
For information on the availability of this material at the FAA,
call<PHONE_NUMBER>.

    Issued in Des Moines, Washington, on July 23, 2018.
James Cashdollar,
Acting Director, System Oversight Division, Aircraft Certification
Service.
[FR Doc. 2018-16490 Filed 8-1-18; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 83, Number 101 (Thursday, May 24, 2018)]
[Rules and Regulations]
[Pages 24016-24019]
[FR Doc No: 2018-11067]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2018-0463; Product Identifier 2018-CE-021-AD; Amendment
39-19293; AD 2018-11-05]
RIN 2120-AA64

Airworthiness Directives; Honda Aircraft Company LLC Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule; request for comments.

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SUMMARY: We are superseding Airworthiness Directive (AD) 2018-06-10 for
certain Honda Aircraft Company LLC Model HA-420 airplanes. AD 2018-06-
10 required incorporating a temporary revision into the airplane flight
manual and replacing faulty power brake valves upon condition. This AD
retains the actions required in AD 2018-06-10 and adds airplanes to the
Applicability section. This AD was prompted by an inadvertent mistake
in the serial number applicability (both in the service bulletin and in
the AD). We are issuing this AD to address the unsafe condition on
these products by correcting the inadvertent serial number error.

DATES: This AD is effective May 29, 2018.
    The Director of the Federal Register approved the incorporation by
reference of a certain publication listed in this AD as of May 29,
2018.
    The Director of the Federal Register approved the incorporation by
reference of certain other publications listed in this AD as of April
13, 2018 (83 FR 13401, March 29, 2018).
    We must receive any comments on this AD by July 9, 2018.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.
    For service information identified in this final rule, contact
Honda Aircraft Company LLC, 6430 Ballinger Road, Greensboro, North
Carolina 27410; telephone<PHONE_NUMBER>; internet: http://www.hondajet.com. You may view this service information at the FAA,
Policy and Innovation Division, 901 Locust, Kansas City, Missouri
64106. For information on the availability of this material at the FAA,
call<PHONE_NUMBER>. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-
0463.

Examining the AD Docket

    You may examine the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-
0463; or in person at Docket Operations between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays. The AD docket contains
this final rule, the regulatory evaluation, any comments received, and
other information. The street address for Docket Operations (phone:
800-647-5527) is listed above. Comments will be available in the AD
docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Samuel Kovitch, Aerospace Engineer,
Atlanta ACO Branch, FAA, 1701 Columbia Avenue, College Park, Georgia
30337; phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
[email protected].

SUPPLEMENTARY INFORMATION:

Discussion

    We issued AD 2018-06-10, Amendment 39-19230 (83 FR 13401, March 29,
2018), (``AD 2018-06-10''), for certain Honda Aircraft Company LLC
Model HA-420 airplanes. AD 2018-06-10 required incorporating a
temporary revision into the airplane flight manual and replacing faulty
power brake valves upon condition. AD 2018-06-10 resulted from reports
of unannunciated asymmetric braking during ground operations and
landing deceleration. We issued AD 2018-06-10 to detect failure of the
power brake valve. The unsafe condition, if not addressed, could result
in degraded braking performance and reduced directional control during
ground operations and landing deceleration.

Actions Since AD 2018-06-10 was Issued

    Since we issued AD 2018-06-10, we were notified by Honda Aircraft
Company that Service Bulletin SB-420-32-001, dated January 8, 2018,
contains a typographical error in the serial number effectivity, which
was also used as the basis for the Applicability section of AD 2018-06-
10. The service bulletin incorrectly listed the applicable Model HA-420
airplane serial number effectivity as 42000011 through 4200089 instead
of 42000011 through 42000089. We are issuing this AD to address the
unsafe condition on these products by correcting the inadvertent serial
number error.

Related Service Information Under 1 CFR Part 51

    We reviewed Honda Aircraft Company Service Bulletin SB-420-32-001,
Revision B, dated April 16, 2018. The service information describes
procedures for replacing a defective PBV with an improved design PBV.
This service information is reasonably available because the interested
parties have access to it through their normal course of business or by
the means identified in the ADDRESSES section.

FAA's Determination

    We are issuing this AD because we evaluated all the relevant
information and determined the unsafe condition described previously is
likely to exist or develop in other products of the same type design.

AD Requirements

    This AD requires inserting a temporary revision into the AFM, which
may be performed by the owner/operator (pilot) holding at least a
private pilot certificate and must be entered into the airplane records
showing

compliance with this AD in accordance with 14 CFR 43.9 (a)(1)-(4) and
14 CFR 91.417(a)(2)(v). The record must be maintained as required by 14
CFR 91.417, 121.380, or 135.439. This AD also requires replacing the
installed PBV, P/N HJ1-13243-101-005 or P/N HJ1-13243-101-007, with an
improved PBV, P/N HJ1-13243-101-009, if a defective PBV is detected
during the required pilot checks as specified in the temporary
revision. In addition, this AD provides an optional terminating action
for the temporary revision into the AFM by replacing the installed PBV
with the improved PBV, P/N HJ1-13243-101-009.

Interim Action

    We consider this AD interim action. We are currently considering
requiring replacement of the installed PBV, P/N HJ1-13243-101-005 or P/
N HJ1-13243-101-007, with an improved part, which will constitute
terminating action for the temporary revision to the AFM. However, the
planned compliance time for the replacement of the PBV would allow
enough time to provide notice and opportunity for prior comment on the
merit of the replacement.

FAA's Justification and Determination of the Effective Date

    An unsafe condition exists that requires the immediate adoption of
this AD without providing an opportunity for public comments prior to
adoption. The FAA has found that the risk to the flying public
justifies waiving notice and comment prior to adoption of this rule
because failure of the PBV could cause degraded braking performance and
reduced directional control during ground operations and landing
deceleration. Therefore, we find good cause that notice and opportunity
for prior public comment are impracticable. In addition, for the reason
stated above, we find that good cause exists for making this amendment
effective in less than 30 days.

Comments Invited

    This AD is a final rule that involves requirements affecting flight
safety, and we did not provide you with notice and an opportunity to
provide your comments before it becomes effective. However, we invite
you to send any written data, views, or arguments about this final
rule. Send your comments to an address listed under the ADDRESSES
section. Include the docket number FAA-2018-0463 and product identifier
2018-CE-021-AD at the beginning of your comments. We specifically
invite comments on the overall regulatory, economic, environmental, and
energy aspects of this final rule. We will consider all comments
received by the closing date and may amend this final rule because of
those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this final rule.

Costs of Compliance

    We estimate that this AD affects 72 airplanes of U.S. registry.
    We estimate the following costs to comply with this AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per      Cost on U.S.
             Action                   Labor cost              Parts cost              product        operators
----------------------------------------------------------------------------------------------------------------
Insert temporary revision into    1 work-hour x $85   Not applicable............             $85          $6,120
 the airplane flight manual.       per hour = $85.
----------------------------------------------------------------------------------------------------------------

    We estimate the following costs to do any necessary replacements
that would be required based on the results of the pilot check of the
braking system during ground operations before every flight and before
every landing. We have no way of determining the number of airplanes
that might need these replacements:

                                               On-Condition Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per
                    Action                                 Labor cost               Parts cost        product
----------------------------------------------------------------------------------------------------------------
Replace the power brake valve.................  20 work-hours x $85 per hour =           $21,878         $23,578
                                                 $1,700.
----------------------------------------------------------------------------------------------------------------

    Since the addition of airplanes to the Applicability section is
based on a typographical error in the manufacturer's service
information, all affected airplanes were previously accounted for in
the cost estimate of AD 2018-06-10. There is no change to this Cost of
Compliance section.

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. Subtitle I, Section 106, describes the
authority of the FAA Administrator. Subtitle VII, Aviation Programs,
describes in more detail the scope of the Agency's authority.
    We are issuing this rulemaking under the authority described in
Subtitle VII, Part A, Subpart III, section 44701, ``General
requirements.'' Under that section, Congress charges the FAA with
promoting safe flight of civil aircraft in air commerce by prescribing
regulations for practices, methods, and procedures the Administrator
finds necessary for safety in air commerce. This regulation is within
the scope of that authority because it addresses an unsafe condition
that is likely to exist or develop on products identified in this
rulemaking action.
    This AD is issued in accordance with authority delegated by the
Executive Director, Aircraft Certification Service, as authorized by
FAA Order 8000.51C. In accordance with that order, issuance of ADs is
normally a function of the Compliance and Airworthiness Division, but
during this transition period, the Executive Director has delegated the
authority to issue ADs applicable to small airplanes, gliders,
balloons, airships, domestic business jet transport airplanes, and
associated appliances to the Director of the Policy and Innovation
Division.

Regulatory Findings

    This AD will not have federalism implications under Executive Order
13132. This AD will not have a substantial direct effect on the States,
on

the relationship between the national government and the States, or on
the distribution of power and responsibilities among the various levels
of government.
    For the reasons discussed above, I certify that this AD:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Is not a ``significant rule'' under DOT Regulatory Policies and
Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

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

Adoption of the Amendment

    Accordingly, under the authority delegated to me by the
Administrator, the FAA amends part 39 of the Federal Aviation
Regulations (14 CFR part 39) as follows:

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by removing Airworthiness Directive (AD)
2018-06-10, Amendment 39-19230 (83 FR 13401, March 29, 2018) and adding
the following new AD:

2018-11-05 Honda Aircraft Company LLC: Amendment 39-19293; Docket
No. FAA-2018-0463; Product Identifier 2018-CE-021-AD.

(a) Effective Date

    This AD is effective May 29, 2018.

(b) Affected ADs

    This AD replaces AD 2018-06-10, Amendment 39-19230 (83 FR 13401,
March 29, 2018), (``AD 2018-06-10'').

(c) Applicability

    This AD applies to Honda Aircraft Company LLC Model HA-420
airplanes, serial numbers 42000011 through 42000089, that:
    (1) have power brake valve, part number (P/N) HJ1-13243-101-005
or HJ1-13243-101-007, installed; and
    (2) are certificated in any category.

(d) Subject

    Joint Aircraft System Component (JASC)/Air Transport Association
(ATA) of America Code 32, Landing Gear.

(e) Unsafe Condition

    This AD was prompted by reports of unannunciated asymmetric
braking during ground operations and landing deceleration. We are
issuing this AD to detect failure of the power brake valve and to
correct the inadvertent serial number error in AD 2018-06-10. The
unsafe condition, if not addressed, could result in degraded braking
performance and reduced directional control during ground operations
and landing deceleration.

(f) Compliance

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

(g) Insert Temporary Revision Into the Airplane Flight Manual (AFM)

    Before further flight after May 29, 2018 (the effective date of
this AD) insert Honda Aircraft Company Temporary Revision TR 01.1,
dated February 16, 2018, into the Honda Aircraft Company (Honda) HA-
420 Airplane Flight Manual (AFM) (``the temporary revision''). This
insertion and the steps therein may be performed by the owner/
operator (pilot) holding at least a private pilot certificate and
must be entered into the airplane records showing compliance with
this AD in accordance with 14 CFR 43.9 (a)(1)-(4) and 14 CFR
91.417(a)(2)(v). The record must be maintained as required by 14 CFR
91.417, 121.380, or 135.439.

(h) Replace the Power Brake Valve (PBV)

    As of and any time after May 29, 2018 (the effective date of
this AD), if any of the procedures listed in the temporary revision
referenced in paragraph (g) of this AD reveal a leaking PBV, before
further flight, replace the PBV, P/N HJ1-13243-101-005 or P/N HJ1-
13243-101-007, with the improved design PBV, P/N HJ1-13243-101-009.
Do the replacement using the Accomplishment Instructions in either
Honda Service Bulletin SB-420-32-001, dated January 8, 2018, or
Revision B, dated April 16, 2018. Before further flight after
installing P/N HJ1-13243-101-009, remove the temporary revision from
the Honda HA-420 AFM.

(i) No Reporting Requirement

    Although Honda Service Bulletin SB-420-32-001, dated January 8,
2018, and Revision B, dated April 16, 2018, specify submitting
certain information to the manufacturer, this AD does not require
that action.

(j) Optional Terminating Action for Inserting the AFM Temporary
Revision/Pilot Checks

    (1) Instead of inserting the temporary revision or at any time
after inserting the temporary revision required by paragraph (g) of
this AD, you may replace the installed PBV, P/N HJ1-13243-101-005 or
P/N HJ1-13243-101-007, with the improved design PBV, P/N HJ1-13243-
101-009. The replacement must be done using the Accomplishment
Instructions in either Honda Service Bulletin SB-420-32-001, dated
January 8, 2018, or Revision B, dated April 16, 2018. Before further
flight after installing P/N HJ1-13243-101-009, remove the temporary
revision from the Honda HA-420 AFM.
    (2) If you choose to follow the temporary revision required by
paragraph (g) of this AD instead of the optional replacement in
paragraph (j)(1) of this AD, the on-condition replacement required
by paragraph (h) of this AD is still required before further flight.

(k) Special Flight Permit

    Special flight permits for this AD are prohibited.

(l) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Atlanta ACO Branch, FAA, has the authority to
approve AMOCs for this AD, if requested using the procedures found
in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request
to your principal inspector or local Flight Standards District
Office, as appropriate. If sending information directly to the
manager of the certification office, send it to the attention of the
person identified in paragraph (m) of this AD.
    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.
    (3) For service information that contains steps that are labeled
as Required for Compliance (RC), the provisions of paragraphs
(l)(3)(i) and (ii) of this AD apply.
    (i) The steps labeled as RC, including substeps under an RC step
and any figures identified in an RC step, must be done to comply
with this AD. An AMOC is required for any deviations to RC steps,
including substeps and identified figures.
    (ii) Steps not labeled as RC may be deviated from using accepted
methods in accordance with the operator's maintenance or inspection
program without obtaining approval of an AMOC, provided the RC
steps, including substeps and identified figures, can still be done
as specified, and the airplane can be put back in an airworthy
condition.

(m) Related Information

    For more information about this AD, contact Samuel Kovitch,
Aerospace Engineer, Atlanta ACO Branch, FAA, 1701 Columbia Avenue,
College Park, Georgia 30337; phone:<PHONE_NUMBER>; fax: (404) 474-
5605; email: [email protected].

(n) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) of the service information listed
in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless this AD specifies otherwise.
    (3) The following service information was approved for IBR on
May 29, 2018.
    (i) Honda Aircraft Company Service Bulletin SB-420-32-001,
Revision B, dated April 16, 2018.
    (ii) Reserved.
    (4) The following service information was approved for IBR on
April 13, 2018 (83 FR 13401, March 29, 2018).

    (i) Honda Aircraft Company Temporary Revision TR 01.1, dated
February 16, 2018, to the Honda Aircraft Company HA-420 Airplane
Flight Manual.
    (ii) Honda Service Bulletin SB-420-32-001, dated January 8,
2018.
    (5) For Honda Aircraft Company LLC service information
identified in this AD, contact Honda Aircraft Company LLC, 6430
Ballinger Road, Greensboro, North Carolina 27410; telephone (336)
662-0246; internet: http://www.hondajet.com.
    (6) You may view this service information at the FAA, Policy and
Innovation Division, 901 Locust, Kansas City, Missouri 64106. For
information on the availability of this material at the FAA, call
(816) 329-4148.
    (7) You may view this service information that is incorporated
by reference at the National Archives and Records Administration
(NARA). For information on the availability of this material at
NARA, call<PHONE_NUMBER>, or go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued in Kansas City, Missouri, on May 17, 2018.
Pat Mullen,
Aircraft Certification Service, Acting Deputy Director, Policy and
Innovation Division, AIR-601.
[FR Doc. 2018-11067 Filed 5-23-18; 8:45 am]
 BILLING CODE 4910-13-P


			  UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

Issued by the Department of Transportation on November 7, 2003

NOTICE OF ACTION TAKEN -- DOCKET OST 1995-327

________________________________________________________________________
________________________________________________________

This serves as notice to the public of the action described below, taken
by the Department official indicated (no additional confirming order
will be issued in this matter).

Applicant:  AEROVIAS de MEXICO, S.A. de C.V.
                         Date Filed:  October 8, 2003

Relief requested:  Exemption from 49 USC section 41301 to permit the
applicant to continue to conduct scheduled, combination service between
San Jose del Cabo, Mexico, and San Diego, California.

If renewal, date and citation of last action:  November 4, 2002, in this
Docket.

Applicant representative:  William C. Evans,<PHONE_NUMBER>        DOT
analyst:  Allen F. Brown,<PHONE_NUMBER>

Responsive pleadings:  None.

	DISPOSITION

Action:  Approved.			       			                       Action date:
November 7, 2003

Effective dates of authority granted:  November 7, 2003, through
November 7, 2004.

Basis for approval:  United States-Mexico Air Transport Services
Agreement

Except to the extent exempted/waived, this authority is subject to the
terms, conditions, and limitations indicated: Standard exemption
conditions.

Special conditions/Remarks:

Action taken by:   Paul L. Gretch, Director

		      Office of International Aviation

________________________________________________________________________
_______________________________________________________

Under authority assigned by the Department in its regulations, 14 CFR
Part 385, we found that (1) our action was consistent with Department
policy; (2) the applicant was qualified to perform its proposed
operations; (3) grant of the authority was consistent with the public
interest; and (4) grant of the authority would not constitute a major
regulatory action under the Energy Policy and Conservation Act of 1975.
To the extent not granted/deferred/dismissed, we denied all requests in
the referenced Docket.  We may amend, modify, or revoke the authority
granted in this Notice at any time without hearing at our discretion.

Persons entitled to petition the Department for review of the action set
forth in this Notice under the Department’s regulations, 14 CFR
§385.30, may file their petitions within seven (7) days after the date
of issuance of this Notice.  This action was effective when taken, and
the filing of a petition for review will not alter such effectiveness.

An electronic version of this document is available on the World Wide
Web at:

http://dms.dot.gov//reports/reports_aviation.asp


[Federal Register Volume 77, Number 165 (Friday, August 24, 2012)]
[Notices]
[Pages 51596-51599]
[FR Doc No: 2012-20839]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67686; File Nos. SR-NYSE-2012-19; SR-NYSEMKT-2012-13]

Self-Regulatory Organizations; New York Stock Exchange LLC; NYSE
MKT LLC; Order Granting Approval to Proposed Rule Changes, as Modified
by Amendment No. 1, (1) Amending NYSE Rule 13 and NYSE MKT Rule 13--
Equities to Establish New Order Types, (2) Amending NYSE Rule 115A and
NYSE MKT Rule 115A--Equities to Delete Obsolete Text and to Clarify and
Update the Description of The Allocation of Market and Limit Interest
in Opening and Reopening Transactions, (3) Amending NYSE Rule 123C and
NYSE MKT Rule 123C--Equities to Include Better-Priced G Orders in The
Allocation of Orders in Closing Transactions, and (4) Making Other
Technical and Conforming Changes

August 17, 2012.

I. Introduction

    On June 15, 2012, New York Stock Exchange LLC (``NYSE'') and NYSE
MKT LLC (``NYSE MKT'' and together with NYSE, the ``Exchanges'') filed
with the Securities and Exchange Commission (``Commission''), pursuant
to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'')
\1\ and Rule 19b-4 thereunder,\2\ proposed rule changes to (1) amend
NYSE Rule 13 and NYSE MKT Rule 13--Equities (hereinafter referred to
collectively as ``Rule 13'') to establish new order types, (2) amend
NYSE Rule 115A and NYSE MKT Rule 115A--Equities (hereinafter referred
to collectively as ``Rule 115A'') to delete obsolete text and to
clarify and update the description of the allocation of market and
limit interest in opening and reopening transactions, (3) amend NYSE
Rule 123C and NYSE MKT Rule 123C--Equities (hereinafter referred to
collectively as ``Rule 123C'') to include better-priced G orders in the
allocation of orders in closing transactions, and (4) make other
technical and conforming changes. On June 27, 2012, the Exchanges filed
Amendment No. 1 to their proposals. The proposed rule changes, as
modified by Amendment No. 1, were published for comment in the Federal
Register on July 6, 2012.\3\ The Commission received no comments on the
proposals. This order approves the proposed rule changes as modified by
Amendment No. 1.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release Nos. 67317 (June 29,
2012), 77 FR 40133 (SR-NYSE-2012-19) and 67318 (June 29, 2012), 77
FR 40129 (SR-NYSEMKT-2012-13) (hereinafter referred to collectively
as ``Notices'').
---------------------------------------------------------------------------

II. Description of the Proposals

    The Exchanges propose to (1) amend Rule 13 to establish new order
types, (2) amend Rule 115A to delete obsolete text and to clarify and
update the description of the allocation of market and limit interest
in opening and reopening transactions, (3) amend Rule 123C to include
better-priced G orders in the allocation of orders in closing
transactions, and (4) make other technical and conforming changes.

Amendments to Order Type Definitions Under Rule 13

    The Exchanges propose deleting and replacing two types of opening
orders currently defined in Rule 13 to stop opening orders from
executing when a security opens on a quote or routing to an away
market.
    The orders the Exchanges propose to delete are ``At the Opening or
At the Opening Only'' orders. These order types currently are defined
in Rule 13 as market or limit orders which are to be executed on the
opening trade of the stock on one of the Exchanges, or if one of the
Exchanges opens the stock on a quote, the opening trade in the stock on
another market center to which such order or part thereof has been
routed in compliance with Regulation NMS. Under the current definition,
any such order or portion thereof not so executed is to be treated as
cancelled. Furthermore, all or part of such orders that seek the
possibility of an NYSE- or NYSE MKT-only opening execution, and that
are marked as a Regulation NMS-compliant Immediate or Cancel (``IOC'')
order, are immediately and automatically cancelled if they are not
executed on the opening trade of the stock on one of the Exchanges or
if compliance with Regulation NMS would require all or part of such
order to be routed to another market center.
    The Exchanges propose to replace ``At the Opening or At the Opening
Only'' orders with two new order types: Market ``On-the-Open''
(``MOO'') and Limit ``On-the-Open'' (``LOO'') orders. A MOO order would
be defined as a market order in a security that is to be executed in
its entirety on the opening or reopening trade of the security on the
Exchange; it would be immediately and automatically cancelled if the
security opened on a quote or not executed due to tick restrictions. A
LOO order would be defined as a limit order in a security that is to be
executed on the opening or reopening trade of the security on the
Exchange. A LOO order, or a part thereof, would immediately and
automatically cancel if by its terms it were not marketable at the
opening price, if it were not executed on the opening trade of the
security on the Exchange, or if the security opened on a quote. Both
MOO and LOO orders could be entered before the open to participate on
the opening trade or during a trading halt or pause to participate on a
reopening trade.
    The Exchanges also propose to add new order type to IOC Orders in
Rule 13, the ``Immediate or Cancel Minimum Trade Size'' order (``IOC
MTS order''). As proposed, any IOC order, including an intermarket
sweep order, may include a minimum trade size (``MTS'') instruction.\4\
For each incoming IOC-MTS order, Exchange systems will evaluate whether
contra-side displayable and non-displayable interest on Exchange
systems can meet the MTS instruction and will reject such incoming IOC-
MTS order if Exchange contra-side volume cannot satisfy the MTS
instruction. An IOC MTS order could result in an execution in an away
market. The Exchanges would reject any IOC-MTS orders if the security
is not open for trading or when auto-execution is suspended.
---------------------------------------------------------------------------

    \4\ A minimum trade size instruction currently is available to
Floor brokers for d-quotes under NYSE Rule 70.25(d) and NYSE MKT
Rule 70.25(d)--Equities.
---------------------------------------------------------------------------

    In conjunction with the substantive amendments described above, the
Exchanges propose to make technical and conforming changes to the
Immediate or Cancel order definition in Rule 13. The Exchanges would
make conforming changes throughout the definition to provide that only
an IOC order without an MTS instruction could be entered before the
Exchange opening for participation in the opening trade or when auto
execution is suspended, which includes during a trading pause or halt.
In addition, NYSE proposes to delete existing paragraph (e) from its
Immediate or Cancel order definition because the paragraph's references
to commitments to trade received on the Floor through the Intermarket
Trading System are no longer relevant, as the Intermarket Trading
System was decommissioned in 2007.
    Lastly, the Exchanges propose to delete several obsolete provisions
of Rule 13. They propose to delete the definition of Time Order because
this order typically related to a Floor broker order that historically
would have been held by the specialist on behalf of the Floor broker
and converted to a market or limit order at a specified time. The
Exchange notes that this order can no

longer be used by Floor brokers. Also, NYSE proposes to delete the
definition of Auction Market Order \5\ because this order type was
never implemented, and to amend the definition of Auto Ex Order to
remove a reference to the Automated Bond System, which is no longer
operational.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 53539 (March 22,
2006), 71 FR 16353 (March 31, 2006) (SR-NYSE-2004-05) (Order
Approving Proposed Rule Change to Establish a Hybrid Market)
(describing the addition of the proposed Auction Market Order type).
---------------------------------------------------------------------------

Rule 115A--Opening Allocation

    The Exchanges propose to amend Rule 115A, which addresses orders at
the opening or in unusual situations. In its existing form, the Rule
has no main text but has Supplementary Material .10, which addresses
queries to the Display Book before an opening; Supplementary Material
.20, which addresses the arranging of an opening or price by a
Designated Market Maker (``DMM''); and Supplementary Material .30,
which addresses certain functions of Exchange systems with respect to
orders at the opening.
    The Exchanges propose to re-designate what is now Supplementary
Material .10 as paragraph (a) as the main text of Rule 115A. The
Exchanges further propose to add new paragraph (b) to Rule 115A to
address the process of arranging a price and the allocation of orders
on opening and reopening trades. Proposed Rule 115A(b) would provide
that when arranging an opening or reopening price, except as provided
for in proposed Rule 115A(b)(2), which concerns opening a security on a
quote and is described below, market interest \6\ would be guaranteed
to participate in the opening or reopening transaction and have
precedence over (i) limit interest \7\ that is priced equal to the
opening or reopening price of a security and (ii) DMM interest.\8\ In
addition, G orders that are priced equal to the opening or reopening
price of a security would yield to all other limit interest priced
equal to the opening or reopening price of a security except DMM
interest.
---------------------------------------------------------------------------

    \6\ For purposes of the opening or reopening transaction, market
interest would include (i) market and MOO orders, (ii) tick-
sensitive market and MOO orders to buy (sell) that are priced higher
(lower) than the opening or reopening price, (iii) limit interest to
buy (sell) that is priced higher (lower) than the opening or
reopening price, and (iv) Floor broker interest entered manually by
the DMM. See proposed Rule 115A(b)(1)(A).
    \7\ For purposes of the opening or reopening transaction, limit
interest would include (i) limited-priced interest, including e-
Quotes, LOO orders, and G orders; and (ii) tick-sensitive market and
MOO orders that are priced equal to the opening or reopening price
of a security. See proposed Rule 115A(b)(1)(B).
    \8\ Limit interest that is priced equal to the opening or
reopening price of a security and DMM interest would not be
guaranteed to participate in the opening or reopening transaction.
See proposed Rule 115A(b)(1)(C).
---------------------------------------------------------------------------

    Proposed Rule 115A(b)(2) would clarify the circumstances
surrounding when a security could open on a quote. As proposed, Rule
115A(b)(2) would provide that if the aggregate quantity of MOO and
market orders on at least one side of the market equals one round lot
or more, the security must open on a trade. If the aggregate quantity
of MOO and market orders on each side of the market equals less than
one round lot or is zero, the security could open on a quote. If a
security opens on a quote, odd-lot market orders would automatically
execute in a trade immediately following the open on a quote and odd-
lot MOOs would immediately and automatically cancel. MOO and market
orders subject to tick restrictions that either cannot participate at
an opening or reopening price or are priced equal to the opening or
reopening price would not be included in the aggregate quantity of MOO
and market orders.
    Finally, the Exchanges propose to delete Supplementary Material .20
and .30. The Exchanges state that much of the content of these
provisions has been obsolete since the second phase of the New Market
Model was launched in 2008.\9\ For instance, the Exchanges note that
some of the language in these provisions relates to DMMs holding
orders, but DMMs no longer hold orders. Similarly, the Exchanges note
that some of the language in Supplementary Material .30 describes
systems of the Exchanges that are either outdated or otherwise covered
by Rule 15, which deals with Pre-Opening Indications.
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    \9\ See Securities Exchange Act Release Nos. 58845 (Oct. 24,
2008), 73 FR 73683) (Oct. 29, 2008) (SR-NYSE-2008-46); 59022 (Nov.
26, 2008), 73 FR 73683 (Dec. 3, 2008) (SR-NYSEALTR-2008-10).
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    The Exchanges point out that to the extent certain concepts in
Supplementary Material .20 are still relevant or applicable, they are
incorporated into proposed new paragraph 115A(b), described above. For
instance, current paragraphs 2(a), (b), and (c) of Supplementary
Material .20 address the allocation and precedence of certain orders in
openings and reopenings. Paragraph 2(a) provides that a limited price
order to buy (sell) that is at a higher (lower) price than the security
is to be opened or reopened is treated as a market order, and market
orders have precedence over limited orders. Substantially similar
language appears in proposed paragraph 115A(b)(1)(A)(iii). Paragraph
2(b) provides that when the price on a limited price order is the same
as the price at which the stock is to be opened or reopened, it may not
be possible to execute a limited price order at such price, and
substantially similar language appears in proposed paragraph
115A(b)(1)(C). Paragraph 2(c) requires a DMM to see that each market
order the DMM holds participates in the opening transaction, and if the
order is for an amount larger than one round lot, the size of the bid
that is accepted or the offer that is taken establishing the opening or
reopening price is the amount that a market order is entitled to
participate in at the opening or reopening. This concept is contained
in proposed paragraph 115A(b).

Rule 123C--Closing Allocation and ``G Orders''

    The Exchanges propose to amend Rules 13 and 123C as those rules
relate to G orders. First, the Exchanges propose to add the phrase ``G
orders'' as a formal definitional term to an existing order type found
in Rule 13. Paragraph (g) of the Auto Ex Order definition in Rule 13
currently describes ``an order entered pursuant to Subsection (G) of
Section 11(a)(1) of the Securities Exchange Act of 1934.'' The
Exchanges explain in their Notices that this definition is meant to
include proprietary orders of members of the Exchanges when those
orders are executed by one of the members' floor brokers.\10\ While the
Auto Ex order type described in paragraph (g) was commonly referred to
by the Exchanges as a ``G order'' and referred to as such elsewhere in
the Exchanges' rules, it was not officially defined as such in the
Exchanges' order type rules. The Exchanges now propose to add to the
end of paragraph (g) of the Auto Ex Order definition a parenthetical
phrase noting that such orders will be officially defined as ``G
orders.''
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    \10\ In a previous filing, NYSE MKT's predecessor described G
orders as ``orders for an Exchange member's own account where the
member meets a business mix test that requires it to be primarily
engaged in the business of underwriting and distributing securities,
selling securities to customers, and/or acting as a broker and
provided more than 50% of its gross revenues is derived from such
businesses and related activities.'' See Securities Exchange Act
Release No. 63972 (Feb. 25, 2011), 76 FR 12202 (Mar. 4, 2011) (SR-
NYSEAMEX-2011-09).
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    The Exchanges also propose to amend Rule 123C to include better-
priced G orders in the list of orders that must be allocated in whole
or part in closing transactions. Currently, Rule 123C(7)(a) sets forth
six order types that must be included in the closing transaction in

the following order: (1) MOC orders that do not have tick restrictions,
(2) MOC orders that have tick restrictions that limit the execution of
the MOC to a price better than the price of the closing transaction,
(3) Floor broker interest entered manually by the DMM, (4) limit orders
better priced than the closing price, (5) LOC orders that do not have
tick restrictions better priced than the closing transaction, and (6)
LOC orders better priced than the closing transaction that have tick
restrictions that are capable of being executed based on the closing
price (``must execute'' list). Once all of the ``must execute''
interest listed in Rule 123C(7)(a) has been satisfied, Rule 123C(7)(b)
provides that the following interest may be used to offset a closing
imbalance in the following order: (1) Limit orders represented in the
Display Book with a price equal to the closing price, (2) LOC orders
with a price equal to the closing price, (3) MOC orders that have tick
restrictions that limit the execution of the MOC to the price of the
closing transaction, (4) LOC orders that have tick restrictions that
are capable of being executed based on the closing price and the price
of such limit order is equal to the price of the closing transaction,
(5) G orders, and (6) Closing Only orders (``may execute'' list).
    The Exchanges propose to amend Rule 123C(7)(a) to add G orders that
are priced better than the closing price as the last type of order that
must be included in the closing transaction. In conjunction with this
change, the Exchanges also propose to make a conforming change to the
reference to G orders in paragraph 5 of Rule 123(C)(7)(b) (the ``may
execute'' list of interest). Under the proposals, language would be
added to paragraph 5 of Rule 123(C)(7)(b) to make clear that the G
orders included in the ``may execute'' list of interest are those G
orders with a price equal to the closing price--to be distinguished
from the G orders priced better than the closing price that are being
added to the list of ``must execute'' interest in 123(C)(7)(a).
    Finally, the Exchanges propose one more change to the ``may
execute'' list of interest. The Exchanges propose to amend Rule
123C(7)(b)(i) to add that DMM interest, as well as limit orders
represented in the Display Book with a price equal to the closing
price, are the first types of interest that may be used to offset a
closing imbalance. According to the Exchanges, this is intended to be a
clarifying change because they have noted before in prior rule filings
that DMM interest would be treated in such a manner.\11\
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    \11\ See, e.g., Securities Exchange Act Release No. 60974 (Nov.
9, 2009) 74 FR 59299 (Nov. 17, 2009) (SR-NYSE-2009-111) (``After the
`must execute interest' is satisfied, then any limit orders
represented in Display Book at the closing price may be used to
offset the remaining imbalance. It should be noted that DMM
interest, including better-priced DMM interest entered into the
Display Book prior to the closing transaction, eligible to
participate in the closing transaction is always included in the
hierarchy of execution as if it were interest equal to the price of
the closing transaction.'').
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III. Discussion and Commission's Findings

    After carefully considering the proposed rule changes, as modified
by Amendment No.1, the Commission finds that they are consistent with
the requirements of the Act and the rules and regulations thereunder
applicable to a national securities exchange.\12\ In particular, the
Commission finds that the proposals are consistent with Section 6(b) of
the Act.\13\ Specifically, the Commission believes that the proposed
rule changes do not impose any burden on competition not necessary or
appropriate in furtherance of the Act and are designed to promote just
and equitable principles of trade, to prevent fraudulent and
manipulative acts, and, in general, to protect investors and the public
interest.\14\
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    \12\ In approving the proposal, the Commission has considered
the proposed rule's impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
    \13\ 15 U.S.C. 78(f)(b).
    \14\ 15 U.S.C. 78(f)(b)(5).
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    The Exchanges' proposals to delete ``At the Opening or At the
Opening Only'' orders, and to replace them with MOO and LOO orders, are
intended to make clear that such opening orders will not execute when a
security opens on a quote, and that they will not be routed to away
markets. The Commission finds that the proposed MOO and LOO order type
definitions are clear and transparent as to when such orders will be
immediately and automatically cancelled; in the case of a MOO order, if
the security opens on a quote or if it is not executed due to tick
restrictions, and in the case of a LOO order, if it is not marketable
at the opening price, it is not executed on the opening trade of a
security, or if the security opens on a quote. The Commission notes
that the MOO and LOO order types proposed by the Exchanges are
variations of Market ``At-The-Close'' (``MOC'') and Limit ``At-The-
Close'' (``LOC'') orders already offered by the Exchanges.\15\ In
addition, the proposed MOO and LOO order types are similar in concept
and terminology to orders offered by other exchanges.\16\
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    \15\ See Rule 13.
    \16\ See, e.g., NYSE Arca Equities Rule 7.31(t)(1) and (2);
NASDAQ Rule 4752(a)(3) and (4); and BATS Exchange Rule 11.23(a)(14)
and (16).
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    The Commission finds that the other proposed amendments to Rule 13
are also consistent with the requirements of the Act. The Exchanges'
proposed new IOC MTS order type will offer market participants added
functionality and additional trading opportunities similar to what is
offered in other trading venues.\17\ The Exchanges' proposed non-
substantive and technical conforming changes are consistent with the
requirements of the Act because they clarify the rule text for ease of
reference and delete obsolete language.
---------------------------------------------------------------------------

    \17\ See, e.g., Nasdaq Stock Market Rule 4751(e)(5) (defining
``Minimum Quantity Orders'').
---------------------------------------------------------------------------

    In addition, the Commission finds that the Exchanges' proposed
revision of Rule 115A is consistent with the requirements of the Act.
The proposals would specify how market interest would participate in
the opening or reopening transaction and how market interest would have
precedence over limit interest priced equal to the opening price or
reopening price of a security and DMM interest. The Commission believes
that the proposal should ensure that market interest, except as
provided in Rule 115A(b)(2), would be guaranteed to participate in
openings or reopenings.
    The Commission also finds that the proposals would delete
duplicative and obsolete language in Rule 115A, which should bring
clarity to the Exchanges' rules. Similarly, the Commission finds that
amending Rule 123C(7)(b)(i) to expressly provide for the treatment of
DMM interest in offsetting a closing imbalance will add transparency
and clarity to the Exchange's rules, thereby promoting just and
equitable principles of trade.
    Lastly, the Commission believes that the Exchanges' proposed
changes to Rule 123C are consistent with the requirements of the Act,
and in particular Section 11(a) of the Act. Section 11(a)(1) of the Act
prohibits a member of a national securities exchange from effecting
transactions on that exchange for its own account, the account of an
associated person, or any account over which it or an associated person
exercises discretion, unless an exception applies. Subsection (G) of
Section 11(a)(1) provides an exemption from the general prohibition set
forth in Section 11(a)(1) for any transaction for a member's own
account, provided that: (i) Such member is primarily engaged in certain
underwriting, distribution, and

other activities; and (ii) the transaction is effected in compliance
with the rules of the Commission, which, at a minimum, assure that the
transaction is not inconsistent with the maintenance of fair and
orderly markets and yields priority, parity and precedence in execution
to orders for the account of persons who are not members or associated
with members of the exchange.\18\ In addition, Rule 11a1-1(T) under the
Act specifies that a transaction effected on a national securities
exchange for the account of a member which meets the requirements of
Section 11(a)(1)(G)(i) of the Act is deemed, in accordance with the
requirements of Section 11(a)(1)(G)(ii), to be not inconsistent with
the maintenance of fair and orderly markets and to yield priority,
parity, and precedence in execution to orders for the account of non-
members or persons associated with non-members of the exchange, if such
transaction is effected in compliance with certain requirements.\19\
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    \18\ See 15 U.S.C. 78k(a)(1)(G).
    \19\ Rule 11a1-1(T)(a)(1)-(3) provides that each of the
following requirements must be met: (1) A member must disclose that
a bid or offer for its account is for its account to any member with
whom such bid or offer is placed or to whom it is communicated, and
any member through whom that bid or offer is communicated must
disclose to others participating in effecting the order that it is
for the account of a member; (2) immediately before executing the
order, a member (other than the specialist in such security)
presenting any order for the account of a member on the exchange
must clearly announce or otherwise indicate to the specialist and to
other members then present for the trading in such security on the
exchange that he is presenting an order for the account of a member;
and (3) notwithstanding rules of priority, parity, and precedence
otherwise applicable, any member presenting for execution a bid or
offer for its own account or for the account of another member must
grant priority to any bid or offer at the same price for the account
of a person who is not, or is not associated with, a member,
irrespective of the size of any such bid or offer or the time when
entered. See 17 CFR 240.11a1-1(T)(a)(1)-(3).
---------------------------------------------------------------------------

    Under the proposals, the Exchanges would add G orders priced better
than the closing price to the list of ``must execute'' interest to be
allocated in whole or part at the close. Only G orders priced better
than the closing price would be eligible to execute as part of the
``must execute'' interest, and then only after execution of all other
``must execute'' interest.\20\
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    \20\ In its proposal, the Exchanges note that Section
11(a)(1)(G) of the Act does not require better-priced G orders to
yield. See Notices, 77 FR at 40135 and 40131. See also 17 CFR
240.11a1-1(T)(a)(3), which requires that a ``member presenting for
execution a bid or offer for its own account or for the account of
another member shall grant priority to any bid or offer at the same
price for the account of a person who is not, or is not associated
with, a member irrespective of the size of any such bid or offer or
the time when entered.'' The priority of G orders with a price equal
to the closing price in relation to other ``may execute'' interest
will remain unchanged under the proposal.
---------------------------------------------------------------------------

    The Commission believes that it is consistent with the requirements
of the Act for G orders priced better than the closing price to execute
before ``may execute'' interest priced equal to the closing price. Such
G orders could offer contra-side interest a chance at price improvement
if executed prior to the close. Further, because the rules will require
G orders priced better than the closing price to yield to all other
eligible orders priced better than the closing price, the Commission
believes that the proposal, with respect to such priority, is
consistent with Section 11(a)(1)(G) of the Act\21\ and Rule 11a1-
1(T)(a)(3) thereunder.\22\
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    \21\ 15 U.S.C. 78k(a)(1)(G).
    \22\ 17 CFR 240.11a1-1(T). The Commission notes that this
exemption is available only for orders for the account of Exchange
members. The Commission also reminds the Exchanges and their members
that, in addition to yielding priority to non-member orders at the
same price, members submitting ``G orders'' must also meet the other
requirements under section 11(a)(1)(G) and Rule 11a1-1(T) to effect
transactions for their own accounts in reliance on this exception
(or satisfy the requirements of another exception).
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IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\23\ that the proposed rule changes (SR-NYSE-2012-19 and SR-
NYSEMKT-2012-13), as modified by Amendment No. 1, be, and hereby are,
approved.
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    \23\ 15 U.S.C. 78s(b)(2).
    \24\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2012-20839 Filed 8-23-12; 8:45 am]
BILLING CODE 8011-01-P