            2014 Compliance Recertification Application (CRA-2014)
          Compliance Application Review Document (CARD Section 194.43)
                        Passive Institutional Controls

43.0  Background

	Assurance requirements were included in the disposal regulations to compensate in a qualitative manner for the inherent uncertainties in projecting the behavior of natural and engineered components of the Waste Isolation Pilot Plant (WIPP) for many thousands of years (50 FR 38072).  Section 194.43 incorporates one of the assurance requirements in the Compliance Criteria.  Passive institutional controls (PICs) are defined in Section 191.12 as "(1) Permanent markers placed at a disposal site, (2) public records and archives, (3) government ownership and regulations regarding land or resource use, and (4) other methods of preserving knowledge about the location design, and contents of a disposal system."  The advantage of PICs is that they require little or no human intervention to convey the message to potential intruders that they should not disturb the site (Taylor, 1993).

       The Department of Energy (DOE) defines the goal of PICs (Compliance Certification Application, 1996, Appendix PIC) "is to minimize the likelihood of inadvertent human activities that affect repository performance".  DOE will implement PICs that involve multiple types and multiple levels of passive controls to make human intrusion into the disposal site unlikely.

	Because changes in language, technology, and political institutions cannot be predicted over thousands of years, Passive institutional controls and their messages cannot be assumed to last in perpetuity.  For this reason, neither the disposal regulations nor the compliance criteria require that PICs be shown to be effective for 10,000 years (Response to Comments Document for 40 CFR Part 194, p. 15-12).  In addition, there is no guarantee that a person will obey an admonition not to disturb the site, even if he or she has read and understood it.   The U.S. Environmental Protection Agency (EPA or Agency) therefore intends that PICs serve only to avert "unintentional" intrusions into the repository (e.g., resource exploration resulting from lack of knowledge of the presence of radioactive waste).  The Agency also intends that PICs be designed to survive as long as possible using available technology and materials.   As technology advances, this design concept will be revisited over the operational lifetime of the WIPP. If the DOE believes the design can be enhanced, changes will be proposed during the recertification process for EPA approval.

43.1  Requirements

	(a)  "Any compliance application shall include detailed descriptions of the measures that will be employed to preserve knowledge about the location, design, and contents of the disposal system.  Such measures shall include:

            (1)  Identification of the controlled area by markers that have been designed and will be fabricated and emplaced to be as permanent as practicable.

            (2)  Placement of records in the archives and land record systems of local, State, and Federal governments, and international archives, that would likely be consulted by individuals in search of unexploited resources.  Such records shall identify:

			(i)  The location of the controlled area and the disposal system.

			(ii)  The design of the disposal system.

			(iii)  The nature and hazard of the waste.

                  (iv)  Geologic, geochemical, hydrologic, and other site data pertinent to the containment of waste in the disposal system, or the location of such information, and

                  (v)  The results of tests, experiments, and other analyses relating to backfill of excavated areas, shaft sealing, waste interaction with the disposal system, and other tests, experiments, or analyses pertinent to the containment of waste in the disposal system, or the location of such information.

            (3)  Other passive institutional controls practicable to indicate the dangers of the waste and its location."

(b)  "Any compliance application shall include the period of time passive institutional controls are expected to endure and be understood."

 "The Administrator may allow the Department to assume passive institutional control credit, in the form of reduced likelihood of human intrusion, if the Department demonstrates in the compliance application that such credit is justified because the passive institutional controls are expected to endure and be understood by potential intruders for the time period approved by the Administrator.  Such credit, or a smaller credit as determined by the Administrator, cannot be used for more than several hundred years and may decrease over time.  In no case, however, shall passive institutional controls be assumed to eliminate the likelihood of human intrusion entirely."

43.2  1998 Certification Decision

	To meet the requirements for Section 194.43(a)(1), EPA expected the U.S. Department of Energy (DOE) to describe the markers that would be placed at the WIPP site to warn future generations about the disposal system's design and contents, which included the presence and hazards of radioactive waste.  The markers were to be as permanent as is practicable using current technology.  They also needed to describe individual markers in detail and be supported by information demonstrating that the markers were as permanent as practicable.  Permanence refers to the markers' ability to withstand both natural and human-initiated forces that could reasonably be expected to occur at the site.  Markers did not need to be designed to withstand catastrophic, low-probability events, such as nuclear war or a comet strike, since any attempt to do so would undoubtedly strain the practicability of the design.  Practicability refers to DOE's ability to emplace markers using currently available resources and technology.

	In addition to describing markers that would be fabricated and emplaced, DOE was also expected to provide a time line for implementing the markers.  Finally, DOE was permitted to propose a credit for PICs in the performance assessment.  A credit must be based on the proposed effectiveness of PICs over time, and would take the form of reduced likelihood in the performance assessment of human intrusion over several hundred years.

	Compliance Certification Application (CCA) Chapters <IP_ADDRESS>.1 and <IP_ADDRESS>, Appendices PIC and EPIC, and supplemental information requested by EPA contain the information supporting DOE's compliance with this requirement.

	EPA determined that DOE complied with the requirements of Section 194.43 because the measures proposed in the CCA were comprehensive, practicable, and likely to endure and be understood for long periods of time.  EPA denied DOE's request for credit for a 99 percent reduction in the likelihood of human intrusion into WIPP during the first 700 years after closure.  EPA denied the credit because DOE did not use an expert judgment elicitation to derive the credit.  EPA also established a condition of the 1998 Certification Decision that DOE submit additional information concerning the schedule for completing PICs, fabrication of granite markers, and commitments by various recipients to accept WIPP records no later than the final recertification application.

	A complete description of EPA's 1998 Certification Decision for Section 194.43 can be obtained from EPA Air Docket, A-93-02, Items V-A-1 and V-B-2.

43.3  Changes in the 2004 Compliance Recertification Application (2004 CRA)

	In Chapter 7.3.1 (Requirements for PICs) of the 2004 Compliance Recertification Application (2004 CRA), DOE added language discussing Condition 4 of EPA's 1998 Certification Decision.  This condition requires that DOE must submit the following prior to the final recertification application submitted before closure of the disposal system:

 A schedule for implementing PICs, which also describes the testing of all aspects of the conceptual design;
 Documentation regarding the granite pieces for the proposed monuments;
 Documentation regarding the archives and record centers maintaining the WIPP docket documents; and
 Documentation regarding plan to ensure the recipients of WIPP information continue to have access to docket documents and supplementary information.

	New information pertaining to the permanent markers portion of the PICs program and additional amendments to the planning process was also included in Chapter 7.3.3 (Implementation of the PICs program) the 2004 CRA, which is documented in the following reports:

 Permanent Markers Testing Program Plan;
 Program Overview;
 Testing Rationale;
 Tests Specification;
 Detailed Test Plans;
 Evaluation of Results;
 Program Organization;
 Quality Assurance;
 Contractor Reports;
 Rock Types;
 Form of Inscriptions; and
 Additional Studies.

	Language discussing the design specifications for the markers was added in 2004 CRA Chapter <IP_ADDRESS>.1 (Markers).  DOE noted that the final specifications will be provided to EPA for approval prior to construction.

	Examples of the types of files to be archived were added in 2004 CRA Chapter <IP_ADDRESS>.2 (Records).

	In 2004 CRA, Chapter <IP_ADDRESS> (PICs Timelines) discusses a new and revised schedule under which DOE will implement its PICs program.  DOE references a letter sent to EPA (dated May 16, 2002; Docket A-98-49, II-B3-41) and EPA's subsequent approval (dated November 7, 2002; Docket A-98-49, Item II-B3-41) of this revised timeline.

	DOE claimed no credit for the effectiveness of PICs for the 2004 CRA, Chapter <IP_ADDRESS> and was not changed for the 2004 CRA PABC (Docket A-98-49, Item II-B1-16). As indicated previously by EPA, DOE has the right to claim such credit in future recertification applications.

43.3.1  Evaluation of Compliance for the 2004 Recertification

	Based on EPA's review of the activities and conditions in and around the WIPP site, EPA did not identify any significant changes in the planning and execution of the DOE's PICs plan since the 1998 Certification Decision.

	The 2004 CRA adequately describes, in detail, the proposed PICs and their location and function, and identified the basis for their assumed effectiveness.  In addition, DOE has shown that they understand their obligations as required under Condition 4 of EPA's initial certification decision.  EPA also found that DOE justified the changes in the 2004 CRA regarding the design specifications and timeline  -  the latter of which was already reviewed and approved by the Agency.  EPA continued to find DOE's assertion that the PICs program at WIPP can be considered as permanent as practicable.

	Public comments expressed concern that DOE did not provide adequate information on their proposed PIC plan, nor for the basis for delays.  Additionally, a comment contended the 2004 CRA was incomplete because it lacks a discussion of the accelerated cleanup program and its possible impacts on WIPP and closure activities, including the PIC system.

	The Agency had organized a detailed review plan and proceeded accordingly.  Following receipt of the CRA on March 26, 2004, EPA began to identify areas of the application where additional information was needed.  A May 24, 2004 Federal Register notice announced availability of the CRA and opened the official public comment period on the CRA.  Over the course of the following 19 months, the Agency submitted six official letters (May 20, 2004; July 12, 2004; September 2, 2004; December 17, 2004; February 3, 2005; and March4, 2005) to DOE requesting additional information regarding CRA.  The Department responded with a series of 11 letters (July15, 2004; August 16, 2004; September 7, 2004; September 29, 2004; October 20, 2004; November 1, 2004; December 17, 2004; January 19, 2005; Mach 21, 2005; May 11, 2005; and September 20, 2005) submitting all of the requested supplemental information to EPA.  On September 29, 2005 EPA announced that DOE's recertification application was complete (70 FR 61107-61111). All requests for additional technical information and the DOE responses are located in EPA's Air Docket A-98-49, Categories II-B2 and II-B3.   Though not an official rulemaking, the Agency also considered public comments related to recertification.  EPA's recertification decision is based on the entire record available to the Agency, which is located in EPA's Air Docket A-98-49.

	DOE submitted a proposal in May 2002 (Docket A-98-49, II-B3-41) to change the schedule for implementation of the PICs program, and EPA responded with a November 2002 memorandum (Docket A-98-49, II-B3-41) accepting the revised schedule which still requires DOE to provide data in advance of the decommissioning of the WIPP facility.  EPA believed DOE has provided sufficient information based on our review of the 2004 CRA.

43.3.2  2004 Recertification Decision

	Based on a review and evaluation of the 2004 CRA and supplemental information provided by DOE (FDMS Docket ID No. EPA-HQ-OAR-2004-0025, Air Docket A-98-49), EPA determined that DOE continues to comply with the requirements for Section 194.43.

43.4  Changes in the  2009 CRA

	In 2007 (Moody 2007), the DOE requested an extension to start testing passive institutional controls 10 years before closure as was proposed in DOE's letter of May 16, 2002 (Triay, 2002).  This request for extension was proposed to be utilized by the Department in exploring the most recent design and technologies available at the time of closure.  As is mentioned at the end of the "BACKGROUND" section (p. 43-1), the Agency intends that the PICs be designed to survive as long as possible using available technologies and materials.  EPA agreed to the request for extension was provided in a letter dated March 7, 2008 (Reyes, 2008).  A revised list of schedule changes for PICs testing is presented in the CRA -2009 (DOE Section 43.6, Table 43-1).

43.4.1  Evaluation of Compliance for 2009 CRA Recertification

	DOE has not proposed any changes in the passive institutional controls program of 2009 CRA and notes that "Information pertaining to the program as provided for the CCA and the 2004 CRA remains unchanged, with the exception of the PICs testing schedule.  The DOE believes it has demonstrated continued compliance with the provisions of section 194.43".

	On the basis of its own independent and thorough review of the activities and conditions in and around the WIPP site, EPA came to similar conclusions and did not identify any significant changes in the planning and execution of the DOE's PIC plan since the 1998 Certification and the 2004 Recertification Decision.

43.4.2  2009 CRA Recertification Decision

	Based on a review and evaluation of the 2009 CRA and supplemental information provided by DOE (FDMS Docket ID No. EPA-HQ-OAR-2009-0330, Air Docket A-98-49), EPA determines that DOE continues to comply with the requirements for Section 194.43.

43.5  Changes in the  2014 CRA

	As noted by DOE in the 2014 CRA DOE Section 43.8; "...the DOE is not proposing any changes to the PICs program for the WIPP. Information pertaining to the program as provided by the CCA, CRA-2004, and CRA-2009 remain unchanged". EPA believes this means that the present approved peer reviewed PICs plan and design has not changed and could be implemented if and when needed. It appears the design is unchanged but the schedule continues to change.  In summary; in May 2002 DOE requested a schedule change, then in January 2007 DOE request another schedule delay (see Patterson et al. 2013, page 3) and in July 2010 DOE requested another extension (see Moody 2010).

43.5.1  Evaluation of Compliance for 2014 CRA Recertification

	DOE has not proposed any changes in the passive institutional controls program for the 2014 CRA.  But it appears the program is evolving.

	On the basis of its EPA's independent and thorough review of the activities and conditions in and around the WIPP site, EPA did not identify any significant changes in the planning and proposed execution of the DOE's PIC plan since the CCA and previous CRAs.

       EPA expects DOE to fulfill the requirements of Condition 4 of EPA's 1998 certification decision, noted in Section 43.3 above.  EPA understands that DOE wishes to coordinate the PICs program with international norms. Any new test design or other changes affecting PICs should be reflected in future CRAs.

43.5.2  2014 CRA Recertification Decision

	Based on a review and evaluation of the 2014 CRA and supplemental information provided by DOE (FDMS Docket ID No. EPA-HQ-OAR-2014-0609), EPA determines that the approved CCA PICs program is unchanged in the 2014 CRA and that DOE continues to comply with the requirements for Section 194.43.


[Federal Register Volume 88, Number 73 (Monday, April 17, 2023)]
[Notices]
[Pages 23498-23499]
[FR Doc No: 2023-07960]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

[Summary Notice No. PE-2023-10]

Petition for Exemption; Summary of Petition Received; The Boeing
Company

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of petition for exemption received.

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

SUMMARY: This notice contains a summary of a petition seeking relief
from specified requirements of Federal Aviation Regulations. The
purpose of this notice is to improve the public's awareness of, and
participation in, the FAA's exemption process. Neither publication of
this notice nor the inclusion or omission of information in the summary
is intended to affect the legal status of the petition or its final
disposition.

DATES: Comments on this petition must identify the petition docket
number and must be received on or before May 8, 2023.

ADDRESSES: Send comments identified by docket number FAA-2023-0838
using any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the online instructions for sending your
comments electronically.
     Mail: Send comments to Docket Operations, M-30; U.S.
Department of Transportation (DOT), 1200 New Jersey Avenue SE, Room
W12-140, West Building Ground Floor, Washington, DC 20590-0001.
     Hand Delivery or Courier: Take comments to Docket
Operations in Room W12-140 of the West Building Ground Floor at 1200
New Jersey Avenue SE, Washington, DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
     Fax: Fax comments to Docket Operations at<PHONE_NUMBER>.
    Privacy: In accordance with 5 U.S.C. 553(c), DOT solicits comments
from the public to better inform its rulemaking process. DOT posts
these comments, without edit, including any personal information the
commenter provides, to http://www.regulations.gov, as described in the
system of records notice (DOT/ALL-14 FDMS), which can be reviewed at
http://www.dot.gov/privacy.
    Docket: Background documents or comments received may be read at
http://www.regulations.gov at any time. Follow the online instructions
for accessing the docket or go to the Docket Operations in Room W12-140
of the West Building Ground Floor at 1200 New Jersey Avenue SE,
Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal holidays.

FOR FURTHER INFORMATION CONTACT: Deana Stedman, AIR-646, Federal
Aviation Administration, 2200 South 216th Street, Des Moines, WA 98198,
phone and fax<PHONE_NUMBER>, email [email protected].
    This notice is published pursuant to 14 CFR 11.85.

    Issued in Washington, DC, on April 11, 2023.
Candace E. Keefe,
Acting Manager, Technical Writing Section.

Petition for Exemption

    Docket No.: FAA-2023-0838
    Petitioner: The Boeing Company
    Section(s) of 14 CFR Affected: Sec. Sec.  25.671(c), 25.672(c),
25.1301(a)(1), 25.1309(b)(1),

25.1309(c), 25.1309(d), 25.1316(a), 25.1317(a).
    Description of Relief Sought: The Boeing Company is petitioning
for a temporary exemption from the affected sections of 14 CFR until
March 1, 2027 to allow it time to incorporate necessary design
changes for the High Lift Flap-Slat Electronics Unit on the Model
737-7 airplane.

[FR Doc. 2023-07960 Filed 4-14-23; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 88, Number 212 (Friday, November 3, 2023)]
[Rules and Regulations]
[Pages 75490-75494]
[FR Doc No: 2023-24352]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 73

[Docket No. FDA-2020-C-2131]

Listing of Color Additives Exempt From Certification; Jagua
(Genipin-Glycine) Blue

AGENCY: Food and Drug Administration, HHS.

ACTION: Final rule.

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

SUMMARY: The Food and Drug Administration (FDA or we) is amending the
color additive regulations to provide for the safe use of jagua
(genipin-glycine) blue as a color additive in various food categories
at levels consistent with good manufacturing practice (GMP). We are
taking this action in response to a color additive petition (CAP)
submitted by Exponent, Inc. on behalf of Ecoflora SAS (Ecoflora).

DATES: This rule is effective December 4, 2023. See section X for
further information on the filing of objections. Either electronic or
written objections and requests for a hearing on the final rule must be
submitted by December 4, 2023.

ADDRESSES: You may submit objections and requests for a hearing as
follows. Please note that late, untimely filed objections 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
December 4, 2023. Objections 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 objections in the following way:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Objections submitted
electronically, including attachments, to https://www.regulations.gov
will be posted to the docket unchanged. Because your objection will be
made public, you are solely responsible for ensuring that your
objection 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 objection, that information will be
posted on https://www.regulations.gov.
     If you want to submit an objection with confidential
information that you do not wish to be made available to the public,
submit the objection as a written/paper submission and in the manner
detailed (see ``Written/Paper Submissions'' and ``Instructions'').

Written/Paper Submisisons

    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 objections submitted to the Dockets
Management Staff, FDA will post your objection, 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-C-2131 for ``Listing of Color Additives Exempt from
Certification; Jagua (Genipin-Glycine) Blue.'' Received objections,
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, 240-
402-7500.
     Confidential Submissions--To submit an objection with
confidential information that you do not wish to be made publicly
available, submit your objections 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.'' We
will review this copy, including the claimed confidential information,
in our 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,<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Shayla West-Barnette, Center for Food
Safety and Applied Nutrition, Food and Drug Administration, 5001 Campus
Dr., College Park, MD 20740-3835,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Introduction

    In a notification published in the Federal Register on November 20,
2020 (85 FR 74304), we announced that we filed a color additive
petition (CAP 0C0317) submitted by Ecoflora SAS, c/o Exponent, Inc.,
1150 Connecticut Ave. NW, Suite 1100, Washington, DC 20036. The
petition proposed to amend the color additive regulations in part 73
(21 CFR part 73), ``Listing of Color Additives Exempt from
Certification,'' to provide for the safe use of jagua (genipin-glycine)
blue, derived from the pulp of the unripe jagua fruit (Genipa
americana), as a color additive at levels consistent with GMP in
flavored milk; dairy drinks and substitutes; dairy and dairy
alternative yogurt; ice cream, frozen dairy and dairy alternative
desserts, puddings, gelatins, ices, sorbets; ready-to-eat multicolored
cereals; flavored potato chips, tortilla, corn, and other chips; candy
and chewing gum; non-alcoholic fruit based/flavored drinks, nutritional
beverages and smoothies; flavored cream cheese-based spreads; and
icings, frostings, jams, syrups, and fruit toppings and fillings.

II. Background

    The color additive that is the subject of this petition is a dark
blue liquid or powder produced by reacting genipin (CAS Reg. No. 6902-
77-8) in the juice of the unripe fruit of Genipa americana with an
equivalent amount of the amino acid glycine (CAS Reg. No. 56-40-6)
using mild heat. The principal coloring component in jagua (genipin-
glycine) blue is a genipin-glycine polymer (CAS Reg. No. 1314879-21-4)
consisting of repeating dimeric units containing two genipin moieties
reacted to add glycine units as side chains. We will subsequently refer
to this principal coloring component as ``the polymer.'' Iridoids, of
which genipin is an example, are found in a wide variety of plants, and
glycine is a common building block of proteins. The color additive
jagua (genipin-glycine) blue also contains three dimers as minor
coloring components (CAS Reg. No. 1313734-13-2, CAS Reg. No. 104359-67-
3, and CAS Reg. No. 1313734-14-3) that are structural units of the
polymer.
    The petitioner proposed the following specifications for jagua
(genipin-glycine) blue: appearance, dark blue; color value (E10
percent), 240-280 for the powder form and 120-240 for the liquid form;
polymer, 20 to 40 percent for the powder form and 10 to 35 percent for
the liquid form; aflatoxins (B1, B2, G1, and G2), not more than 0.01
milligram per kilogram (mg/kg); fumonisine (B1, B2), not more than 0.5
mg/kg; Escherichia coli, negative in 1 gram (g); aerobic plate count,
not more than 1,000 colony forming units per gram (cfu/g); yeast and
mold, not more than 300 cfu/g, and Staphylococcus aureus, negative in 1
g.
    FDA amended the proposed specifications to add the following:
arsenic, not more than 1 mg/kg; cadmium, not more than 1 mg/kg;
mercury, not more than 1 mg/kg; and lead, not more than 1 mg/kg (Ref.
1). We also amended the proposed specification for genipin, not more
than 20 mg/kg, to be consistent with the petitioner's analytical
results. Furthermore, we concluded that the petitioner's proposed
specifications for appearance, color value, polymer, glycine, the minor
coloring components, carbohydrate, modified starch, total fat, total
protein, and ash content are not needed in the codified regulation
(Ref. 1).

III. Safety Evaluation

    Under section 721(b)(4) of the Federal Food, Drug, and Cosmetic Act
(FD&C Act) (21 U.S.C. 379e(b)(4)), a color additive may not be listed
for a proposed use unless the data and information available to FDA
establish that the color additive is safe for that use. Our color
additive regulations at 21 CFR 70.3(i) define ``safe'' to mean that
there is convincing evidence establishing with reasonable certainty
that no harm will result from the intended use of the color additive.
    To determine whether a color additive is safe under the general
safety clause, the FD&C Act requires FDA to conduct a fair evaluation
of the available data and consider, among other relevant factors: (1)
probable consumption of, or other relevant exposure from, the additive
and of any substance formed in or on food, drugs, devices, or cosmetics
because of the use of the additive; (2) cumulative effect, if any, of
such additive in the diet of man or animals, taking into account
chemically or pharmacologically related substance or substances in such
diet; and (3) safety factors recognized by experts as appropriate for
the use of animal experimentation data (see section 721(b)(5)(A)(i)
through (iii) of the FD&C Act).
    As part of our safety evaluation to establish with reasonable
certainty that a color additive is not harmful under its intended
conditions of use, we consider the additive's manufacturing and

stability, the projected human dietary exposure to the additive and any
impurities resulting from the petitioned use of the additive, the
additive's toxicological data, and other relevant information (such as
published literature) available to us.

IV. Safety of the Petitioned Use of the Color Additive

A. Dietary Exposure Estimate

    The petitioner requested that jagua (genipin-glycine) blue be
permitted at levels consistent with GMP and provided the representative
maximum use levels for the color additive for each proposed food use.
The petitioner used food consumption data from the 2013-2016 National
Health and Nutrition Examination Survey (NHANES) to estimate the
dietary exposure to jagua (genipin-glycine) blue and to the polymer
from the proposed uses. The petitioner stated that the use of the
liquid form of jagua (genipin-glycine) blue would be substitutional for
the powder form and that, on the polymer basis, the use levels are the
same for both forms.
    The petitioner estimated the eaters-only (i.e., only those
individuals in the population that consume the foods of interest)
dietary exposure to jagua (genipin-glycine) blue to be 34 mg/person/day
(mg/p/d) at the mean and 78 mg/p/d at the 90th percentile for the U.S.
population aged 2 years and older, and 34 mg/p/d at the mean and 76 mg/
p/d at the 90th percentile for children aged 2 to 5 years.
    The petitioner provided a specification limit of 20 to 40 percent
for the polymer in jagua (genipin-glycine) blue powder. We estimated
the eaters-only dietary exposure to the polymer to be 14 mg/p/d at the
mean and 31 mg/p/d at the 90th percentile for the U.S. population aged
2 years and older, and 14 mg/p/d at the mean and 30 mg/p/d at the 90th
percentile for children aged 2 to 5 years (Ref. 2).

B. Toxicological Considerations

    To establish that jagua (genipin-glycine) blue is safe for
consumption at the proposed levels, the petitioner used aqueous jagua
(genipin-glycine) blue containing a specified percentage of the polymer
to conduct the following studies: (1) bacterial reverse mutation assay,
mouse lymphoma assay, and in vitro mouse micronucleus assay addressing
potential mutagenicity and genotoxicity of the polymer; (2) studies
conducted in rats to address the potential toxic effects of acute oral
exposure to the polymer; (3) 28-day oral toxicity studies in rats and
beagle dogs and 90-day repeated dose oral toxicity studies in rats and
beagle dogs to address the potential toxic effects of subchronic oral
exposure to the polymer; and (4) 12 months repeated dose toxicity study
including in utero exposure in rats to address the potential toxic and/
or reproductive effects of chronic oral exposure to the polymer.\1\ FDA
searched the publicly available literature to identify any new studies
that might have examined toxicological effects of jagua (genipin-
glycine) blue, or genipin or related compounds; however, no relevant
studies were found.
---------------------------------------------------------------------------

    \1\ The polymer content of the test material used for
toxicological studies varied slightly from batch to batch;
therefore, the toxicological evaluation of studies and the resulting
safety conclusions were based on the polymer content of the batch
used.
---------------------------------------------------------------------------

    We reviewed the mutagenicity and genotoxicity studies (a bacterial
reverse mutation assay, an in vitro mouse lymphoma, and an in vivo
mammalian micronucleus induction assay) and concluded that the polymer
is not mutagenic or genotoxic under the experimental procedures and
conditions applied (Ref. 3).
    We reviewed the acute oral toxicity studies and concluded that the
oral median lethal dose is greater than 661 mg/kg body weight (bw) of
the polymer for the female rats used in the study (Ref. 3).
    We reviewed the 28-day studies conducted in rats and in beagle dogs
and consider these only as range-finding studies due to the limited
number of animals tested per group and other study limitations, and
thus not appropriate to establish a no-observed-effect-level (NOEL) or
no-observed-adverse-effect-level (NOAEL). We reviewed the 90-day
repeated dose oral toxicity study conducted in rats and concur with the
study authors that the NOAEL for the rats under the conditions of the
study was 330.5 mg/kg bw/d of the polymer for both sexes of the rats.
We also reviewed the 90-day repeated dose oral toxicity study in dogs;
however, due to the low number of dogs tested per group, and other
inadequacies and limitations in the experimental design, we concluded
that a NOAEL for the polymer could not be established from this study
(Ref. 3).
    We reviewed the 12-months repeated dose toxicity study including in
utero exposure in rats. The lowest of all the NOAELs for F0
(parental) generation male rats was 1,127 mg/kg bw/d of polymer \2\
(Ref. 3).
---------------------------------------------------------------------------

    \2\ The NOAEL of the polymer (1,127 mg/kg bw/d) was derived from
the NOAEL of the test material (3,094.7 mg/kg bw/d) used in the
study. The polymer content of this test material was 36.4 percent.
The NOAEL of the polymer (1,127 mg/kg bw/d) = NOAEL of the test
material (3,094.7 mg/kg bw/d) x 0.364 = 1,127 mg/kg bw/d.
---------------------------------------------------------------------------

    The study chosen to establish an acceptable daily intake (ADI) for
the polymer was the 12 months repeated dose toxicity study including in
utero exposure to rats over the 90-day study in rats. This study
combined the in utero phase and a 1-year chronic toxicity phase of
sufficient length and overall complexity to produce information on
chronic exposure to the polymer. Based on the NOAEL of the polymer
(1,127 mg/kg bw/d)) in the 12 months repeated dose toxicity study in
rats including in utero exposure, and applying a safety factor of 500
(10 to account for possible increased sensitivity of humans compared to
test animals, 10 to account for sensitive individuals in determining
safe intake for humans, and 5 for the lack of metabolism and
pharmacokinetics and long-term chronic study), the ADI for the polymer
is calculated as follows: 1,127 mg/kg bw/d (NOAEL)/500 = 2.3 mg/kg bw/d
or 138 mg/p/d (based upon 60 kg bw/p) (Ref. 3).\3\
---------------------------------------------------------------------------

    \3\ The Joint Expert Committee on Food Additives (2020) (Ref. 4)
evaluated the 12 months repeated dose toxicity study including in
utero exposure in rats with jagua (genipin-glycine) blue and
reported that the dietary exposure of jagua (genipin-glycine) blue
did not produce any treatment-related effects in this study.
Therefore, the committee identified a NOAEL of 3,094.7 mg/kg bw/d
(1,127 mg/kg bw/d based on 36.4 percent polymer content) and no
effects observed in F0 parental male rats.
---------------------------------------------------------------------------

    The petitioner estimated the highest dietary exposure (37 mg/p/d at
90th percentile based on the polymer) for children aged 6-12 years as
well as adolescents aged 13-18 years. The highest estimated dietary
exposure value of 37 mg/p/d at the 90th percentile based on the polymer
is lower than the ADI value of 138 mg/p/d polymer.
    Therefore, we conclude that the proposed use of jagua (genipin-
glycine) blue as a color additive at levels consistent with GMP is
considered to have reasonable certainty of no harm (Ref. 3).

V. Conclusion

    Based on the data and information in the petition and other
available relevant information, we conclude that the petitioned use of
jagua (genipin-glycine) blue as a color additive in flavored milk;
dairy drinks and substitutes; dairy and dairy alternative yogurt; ice
cream, frozen dairy and dairy alternative desserts, puddings, gelatins,
ices, sorbets; ready-to-eat multicolored cereals, flavored potato
chips, tortilla, corn, and other chips; candy and chewing gum; non-
alcoholic fruit based/flavored drinks, nutritional beverages

and smoothies; flavored cream cheese-based spreads; and icings,
frostings, jams, syrups, and fruit toppings and fillings, provided the
amount of jagua (genipin-glycine) blue does not exceed levels
consistent with GMP.
    We further conclude that this color additive will achieve its
intended technical effect and is suitable for the petitioned use.
Therefore, we are amending the color additive regulations in part 73 to
provide for the safe use of this color additive as set forth in this
document. In addition, based on the factors in 21 CFR 71.20(b), we
conclude that batch certification of jagua (genipin-glycine) blue is
not necessary to protect the public health.

VI. Public Disclosure

    In accordance with Sec.  71.15 (21 CFR 71.15), the petition and the
documents that we considered and relied upon in reaching our decision
to approve the petition will be made available for public disclosure
(see FOR FURTHER INFORMATION CONTACT). As provided in Sec.  71.15, we
will delete from the documents any materials that are not available for
public disclosure.

VII. Analysis of Environmental Impact

    As stated in the November 20, 2020, Federal Register notice of
filing, the petitioner claimed that this action is categorically
excluded under Sec.  25.32(k) (21 CFR 25.32(k)) because jagua (genipin-
glycine) blue would be added directly to food and is intended to remain
in the food through ingestion by consumers and is not intended to
replace macronutrients in food. We further stated that if FDA
determines a categorical exclusion applies, neither an environmental
assessment nor an environmental impact statement is required. We did
not receive any new information or comments regarding this claim of
categorical exclusion. We considered the petitioner's claim of
categorical exclusion and determined that this action is categorically
excluded under Sec.  25.32(k). Therefore, neither an environmental
assessment nor an environmental impact statement is required.

VIII. Paperwork Reduction Act of 1995

    This final rule contains no collection of information. Therefore,
clearance by the Office of Management and Budget under the Paperwork
Reduction Act of 1995 is not required.

IX. Section 301(ll) of the FD&C Act

    Our review of this petition was limited to section 721 of the FD&C
Act. This final rule is not a statement regarding compliance with other
sections of the FD&C Act. For example, section 301(ll) of the FD&C Act
(21 U.S.C. 331(ll)) prohibits the introduction or delivery for
introduction into interstate commerce of any food that contains a drug
approved under section 505 of the FD&C Act (21 U.S.C. 355), a
biological product licensed under section 351 of the Public Health
Service Act (42 U.S.C. 262), or a drug or biological product for which
substantial clinical investigations have been instituted and their
existence has been made public, unless one of the exemptions in section
301(ll)(1) to (4) of the FD&C Act applies. In our review of this
petition, we did not consider whether section 301(ll) of the FD&C Act
or any of its exemptions apply to food containing this color additive.
Accordingly, this final rule should not be construed to be a statement
that a food containing this color additive, if introduced or delivered
for introduction into interstate commerce, would not violate section
301(ll) of the FD&C Act. Furthermore, this language is included in all
color additive final rules that pertain to food and therefore should
not be construed to be a statement of the likelihood that section
301(ll) of the FD&C Act applies.

X. Objections

    This rule is effective as shown in the DATES section, except as to
any provisions that may be stayed by the filing of proper objections.
If you will be adversely affected by one or more provisions of this
regulation, you may file with the Dockets Management Staff (see
ADDRESSES) either electronic or written objections. You must separately
number each objection, and within each numbered objection you must
specify with particularity the provision(s) to which you object, and
the grounds for your objection. Within each numbered objection, you
must specifically state whether you are requesting a hearing on the
particular provision that you specify in that numbered objection. If
you do not request a hearing for any particular objection, you waive
the right to a hearing on that objection. If you request a hearing,
your objection must include a detailed description and analysis of the
specific factual information you intend to present in support of the
objection in the event that a hearing is held. If you do not include
such a description and analysis for any particular objection, you waive
the right to a hearing on the objection.
    Any objections received in response to the regulation may be seen
in the Dockets Management Staff between 9 a.m. and 4 p.m., Monday
through Friday, and will be posted to the docket at https://www.regulations.gov. We will publish notice of the objections that we
have received or lack thereof in the Federal Register.

XI. References

    The following references marked with an asterisk (*) are on display
at the Dockets Management Staff (see ADDRESSES) and are available for
viewing by interested persons between 9 a.m. and 4 p.m., Monday through
Friday; they also are available electronically at https://www.regulations.gov. References without asterisks are not on public
display at https://www.regulations.gov because they have copyright
restriction. Some may be available at the website address, if listed.
References without asterisks are available for viewing only at the
Dockets Management Staff. FDA has verified the website addresses, as of
the date this document publishes in the Federal Register, but websites
are subject to change over time.

1. *Memorandum from N. Belai, Division of Color Certification and
Technology, Office of Cosmetics and Colors, Color Technology Branch
to Division of Food Ingredients, Office of Food Additive Safety,
Regulatory Review Branch, Team 1, Attention: Shayla West-Barnette,
August 16, 2023.
2. *Memorandum from R. Kolanos, Division of Food Ingredients,
Chemistry Review Group 2, Office of Food Additive Safety to Division
of Food Ingredients, Regulatory Review Group 2, Attention: S. West-
Barnette, August 7, 2023.
3. *Memorandum from Abu T. Khan, Office of Food Additive Safety,
Division of Food Ingredients, to Mical Honigfort, Regulatory Review
Branch, Office of Food Additive Safety, Division of Food
Ingredients, August 16, 2023.
4. Food Agriculture Organization of the United Nations (FAO)/World
Health Organization (WHO) Joint Expert Committee on Food Additives,
Summary and Conclusions of Virtual Meeting, issued on July 10, 2020.

List of Subjects in 21 CFR Part 73

    Color additives, Cosmetics, Drugs, Foods, Medical devices.

    Therefore, under the Federal Food, Drug, and Cosmetic Act and under
the authority delegated to the Commissioner of Food and Drugs, 21 CFR
part 73 is amended as follows:

PART 73--LISTING OF COLOR ADDITIVES EXEMPT FROM CERTIFICATION

0
1. The authority citation for part 73 continues to read as follows:

    Authority:  21 U.S.C. 321, 341, 342, 343, 348, 351, 352, 355,
361, 362, 371, 379e.

0
2. Add Sec.  73.225 to subchapter A to read as follows:

Sec.  73.225  Jagua (genipin-glycine) blue.

    (a) Identity. (1) The color additive jagua (genipin-glycine) blue
is a dark blue powder or liquid prepared from the juice of the unripe
fruit of Genipa americana by reacting the genipin in the juice with
glycine using mild heat. The color additive contains a polymer as the
principal coloring component and three dimers as minor coloring
components.
    (2) Color additive mixtures for food use made with jagua (genipin-
glycine) blue may contain only those diluents that are suitable and are
listed in this subpart as safe for use in color additive mixtures for
coloring foods.
    (b) Specifications. Jagua (genipin-glycine) blue must conform to
the following specifications and must be free from impurities, other
than those named, to the extent that such other impurities may be
avoided by good manufacturing practice:
    (1) Arsenic, not more than 1 milligram/kilogram (mg/kg) (1 part per
million (ppm)).
    (2) Cadmium, not more than 1 mg/kg (1 ppm).
    (3) Lead, not more than 1 mg/kg (1 ppm).
    (4) Mercury, not more than 1 mg/kg (1 ppm).
    (5) Genipin, not more than 20 mg/kg (20 ppm).
    (c) Uses and restrictions. Jagua (genipin-glycine) blue may be
safely used for coloring flavored milk; dairy drinks and substitutes;
dairy and dairy alternative yogurt; ice cream, frozen dairy and dairy
alternative desserts, puddings, gelatins, ices, sorbets; ready-to-eat
multicolored cereals; flavored potato chips, tortilla, corn, and other
chips; candy and chewing gum; non-alcoholic fruit based/flavored
drinks, nutritional beverages and smoothies; flavored cream cheese-
based spreads; and icings, frostings, jams, syrups, and fruit toppings
and fillings at levels consistent with good manufacturing practice,
except that it may not be used for coloring foods for which standards
of identity have been issued under section 401 of the Federal Food,
Drug, and Cosmetic Act, unless the use of added color is authorized by
such standards.
    (d) Labeling requirements. The label of the color additive and any
mixtures prepared therefrom intended solely or in part for coloring
purposes must conform to the requirements of Sec.  70.25 of this
chapter.
    (e) Exemption from certification. Certification of this color
additive is not necessary for the protection of the public health and
therefore batches thereof are exempt from the certification
requirements of section 721(c) of the Federal Food, Drug, and Cosmetic
Act.

    Dated: October 30, 2023.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2023-24352 Filed 11-2-23; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register Volume 82, Number 96 (Friday, May 19, 2017)]
[Notices]
[Page 23026]
[FR Doc No: 2017-10185]

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

DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Docket ID FEMA-2017-0002; Internal Agency Docket No. FEMA-B-1648]

Proposed Flood Hazard Determinations for Sierra County,
California and Incorporated Areas

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Proposed notice; withdrawal.

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

SUMMARY: The Federal Emergency Management Agency (FEMA) is withdrawing
its proposed notice concerning proposed flood hazard determinations,
which may include the addition or modification of any Base Flood
Elevation, base flood depth, Special Flood Hazard Area boundary or zone
designation, or regulatory floodway (herein after referred to as
proposed flood hazard determinations) on the Flood Insurance Rate Maps
and, where applicable, in the supporting Flood Insurance Study reports
for Sierra County, California and Incorporated Areas.

DATES: This withdrawal is effective May 19, 2017.

ADDRESSES: You may submit comments, identified by Docket No. FEMA-B-
1648, to Rick Sacbibit, Chief, Engineering Services Branch, Federal
Insurance and Mitigation Administration, FEMA, 400 C Street SW.,
Washington, DC 20472,<PHONE_NUMBER>, or (email)
<EMAIL_ADDRESS>
FOR FURTHER INFORMATION CONTACT: Rick Sacbibit, Chief, Engineering
Services Branch, Federal Insurance and Mitigation Administration, FEMA,
400 C Street SW., Washington, DC 20472,<PHONE_NUMBER>, or (email)
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: On September 19, 2016, FEMA published a
proposed notice at 81 FR 64186, proposing flood hazard determinations
for Sierra County, California and Incorporated Areas. FEMA is
withdrawing the proposed notice.

    Authority:  42 U.S.C. 4104; 44 CFR 67.4.

    Dated: May 2, 2017.
Roy E. Wright,
Deputy Associate Administrator for Insurance and Mitigation, Department
of Homeland Security, Federal Emergency Management Agency.
[FR Doc. 2017-10185 Filed 5-18-17; 8:45 am]
 BILLING CODE 9110-12-P


[Federal Register Volume 81, Number 16 (Tuesday, January 26, 2016)]
[Notices]
[Pages 4283-4284]
[FR Doc No: 2016-01456]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. EL00-95-288]

San Diego Gas & Electric Company v. Sellers of Energy and
Ancillary Services Into Markets Operated by the California Independent
System Operator Corporation and the California Power Exchanges; Notice
of Compliance Filing

    Take notice that on January 4, 2016, Shell Energy North America
(US), LP submitted its Compliance Filing to Order on Rehearing of
Opinion No. 536.\1\
---------------------------------------------------------------------------

    \1\ San Diego Gas & Elec. Co. v. Sellers of Energy & Ancillary
Servs., 153 FERC ] 61,144 (2015) (``Order on Rehearing''), denying
rehearing of San Diego Gas & Elec. Co. v. Sellers of Energy &
Ancillary Servs., Opinion No. 536, 149 FERC ] 61,116 (2014)
(``Opinion No. 536'').
---------------------------------------------------------------------------

    Any person desiring to intervene or to protest this filing must
file in accordance with Rules 211 and 214 of the Commission's Rules of
Practice and Procedure (18 CFR 385.211, 385.214). Protests will be
considered by the Commission in determining the appropriate action to
be taken, but will not serve to make protestants parties to the
proceeding. Any person wishing to become a party must file a notice of
intervention or motion to intervene, as appropriate. Such notices,
motions, or protests must be filed on or before the comment date. On or
before the comment date, it is not necessary to serve motions to
intervene or protests on persons other than the Applicant.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper using the ``eFiling'' link at http://www.ferc.gov. Persons unable to file electronically should submit an
original and 5 copies of the protest or intervention to the Federal
Energy Regulatory Commission, 888 First Street NE., Washington, DC
20426.
    This filing is accessible on-line at http://www.ferc.gov, using the
``eLibrary'' link and is available for review in the Commission's
Public Reference Room in Washington, DC. There is an ``eSubscription''
link on the Web site that enables subscribers to receive email
notification when a document is added to a subscribed docket(s). For
assistance with any FERC Online service, please email
<EMAIL_ADDRESS>or call<PHONE_NUMBER> (toll free). For
TTY, call<PHONE_NUMBER>.
    Comment Date: 5:00 p.m. Eastern Time on March 9, 2016.

    Dated: January 19, 2016.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2016-01456 Filed 1-25-16; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: March 16, 2010 (Volume 75, Number 50)]
[Notices]
[Page 12546-12547]
[DOCID:fr16mr10-60]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2010-N-0120]

Agency Information Collection Activities; Proposed Collection;
Comment Request; Cosmetic Labeling Regulations

AGENCY:  Food and Drug Administration, HHS.

ACTION:  Notice.

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

SUMMARY:  The Food and Drug Administration (FDA) is announcing an
opportunity for public comment on the proposed collection of certain
information by the agency. Under the Paperwork Reduction Act of 1995
(the 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 information collection
provisions in FDA's cosmetic labeling regulations.

DATES:  Submit written or electronic comments on the collection of
information by May 17, 2010.

ADDRESSES:  Submit electronic comments on the collection of information
to http://www.regulations.gov. Submit written comments on the
collection of information to the Division of Dockets Management (HFA-
305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061,
Rockville, MD 20852. All comments should be identified with the docket
number found in brackets in the heading of this document.

FOR FURTHER INFORMATION CONTACT: Denver Presley, Jr., Office of
Information Management, Food and Drug Administration, 1350 Piccard Dr.,
PI50-400B, Rockville, MD 20850,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3520), 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.

Cosmetic Labeling Regulations--21 CFR Part 701 (OMB Control Number
0910-0599)--Extension

    The Federal Food, Drug, and Cosmetic Act (the act) and the Fair
Packaging and Labeling Act (the FPLA) require that cosmetic
manufacturers, packers, and distributors disclose information about
themselves or their products on the labels or labeling of their
products.

Sections 201, 502, 601, 602, 603, 701, and 704 of the act (21 U.S.C.
321, 352, 361, 362, 363, 371, and 374) and sections 4 and 5 of the FPLA
(15 U.S.C. 1453 and 1454) provide authority to FDA to regulate the
labeling of cosmetic products. Failure to comply with the requirements
for cosmetic labeling may render a cosmetic adulterated under section
601 of the act or misbranded under section 602 of the act.
    FDA's cosmetic labeling regulations are published in part 701 (21
CFR part 701). Four of the cosmetic labeling regulations have
information collection provisions. Section 701.3 requires the label of
a cosmetic product to bear a declaration of the ingredients in
descending order of predominance. Section 701.11 requires the principal
display panel of a cosmetic product to bear a statement of the identity
of the product. Section 701.12 requires the label of a cosmetic product
to specify the name and place of business of the manufacturer, packer,
or distributor. Section 701.13 requires the label of a cosmetic product
to declare the net quantity of contents of the product.
    FDA's cosmetic labeling regulations remain unchanged by this
document. FDA is publishing this document in compliance with the PRA.
This document does not represent any new regulatory initiative.
    FDA estimates the annual burden of this collection of information
as follows:

                           Table 1--Estimated Annual Third Party Disclosure Burden\1\
----------------------------------------------------------------------------------------------------------------
                           No. of         Annual Frequency    Total Annual       Hours per
   21 CFR Section        Respondents       of Disclosure       Disclosures       Disclosure       Total Hours
----------------------------------------------------------------------------------------------------------------
701.3                             1,518                 21            31,878                1             31,878
----------------------------------------------------------------------------------------------------------------
701.11                            1,518                 24            36,432                1             36,432
----------------------------------------------------------------------------------------------------------------
701.12                            1,518                 24            36,432                1             36,432
----------------------------------------------------------------------------------------------------------------
701.13                            1,518                 24            36,432                1             36,432
----------------------------------------------------------------------------------------------------------------
Total                                                                                141,174
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of
  information.

    The hour burden is the additional or incremental time that
establishments need to design and print labeling that includes the
following required elements: A declaration of ingredients in decreasing
order of predominance, a statement of the identity of the product, a
specification of the name and place of business of the establishment,
and a declaration of the net quantity of contents. These requirements
increase the time establishments need to design labels because they
increase the number of label elements that establishments must take
into account when designing labels. These requirements do not generate
any recurring burden per label because establishments must already
print and affix labels to cosmetic products as part of normal business
practices.
    According to the 2001 census, there are 1,518 cosmetic product
establishments in the United States (U.S. Census Bureau, http://
www.census.gov/epcd/susb/2001/us/US32562.HTM). FDA calculates label
design costs based on stockkeeping units (SKUs) because each SKU has a
unique product label. Based on data available to the agency and on
communications with industry, FDA estimates that cosmetic
establishments will offer 94,800 SKUs for retail sale in 2010. This
corresponds to an average of 62 SKUs per establishment.
    One of the four provisions that FDA discusses in this information
collection, Sec.  701.3, applies only to cosmetic products offered for
retail sale. However, the other three provisions, Sec. Sec.  701.11,
701.12, and 701.13, apply to all cosmetic products, including non-
retail professional-use-only products. FDA estimates that including
professional-use-only cosmetic products increases the total number of
SKUs by 15 percent to 109,020. This corresponds to an average of 72
SKUs per establishment.
    Finally, based on the agency's experience with other products, FDA
estimates that cosmetic establishments may redesign up to one-third of
SKUs per year. Therefore, FDA estimates that the annual frequency of
response will be 21 (31,878 SKUs) for Sec.  701.3 and 24 each (36,432
SKUs) for Sec. Sec.  701.11, 701.12, and 701.13.
    FDA estimates that each of the required label elements may add
approximately 1 hour to the label design process. FDA bases this
estimate on the hour burdens the agency has previously estimated for
food, drug, and medical device labeling and on the agency's knowledge
of cosmetic labeling. Therefore, FDA estimates that the total hour
burden on members of the public for this information collection is
141,174 hours per year.

    Dated: March 11, 2010.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2010-5657 Filed 3-15-10; 8:45 am]
BILLING CODE 4160-01-S


[Federal Register: November 10, 2005 (Volume 70, Number 217)]
[Notices]
[Page 68486-68490]
[DOCID:fr10no05-162]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52725; File No. SR-NASD-2005-118]

Self-Regulatory Organizations; National Association of Securities
Dealers, Inc.; Notice of Filing and Order Granting Accelerated Approval
of a Proposed Rule Change and Amendment No. 1 Thereto Relating to the
Listing and Trading of 9% Targeted Income Strategic Total Return
SecuritiesSM Linked to the CBOE Nasdaq-100 BuyWrite Index

November 3, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on September 30, 2005, the National Association of Securities Dealers,
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc.
(``Nasdaq''), filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by Nasdaq. On
October 14, 2005, Nasdaq filed Amendment No. 1 to the proposed rule
change.\3\ The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons and is approving
the proposal on an accelerated basis.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 replaced the original filing in its
entirety.
---------------------------------------------------------------------------

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

    Nasdaq proposes to list and trade 9% Targeted Income Strategic
Total Return SecuritiesSM (``9% STRS'' or ``Notes''), the
return on which is based upon the CBOE Nasdaq-100 BuyWrite Index (``BXN
Index'' or ``Index'') and issued by Morgan Stanley. The text of the
proposed rule change is available on the NASD's Web site (http://www.nasd.com
), at the principal offices of the Nasdaq, 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, Nasdaq 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 III below. Nasdaq 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
    Nasdaq proposes to list and trade the Notes. The Notes provide for
a return based upon the BXN Index.
Description of Notes
    The Notes are non-convertible debt issued by Morgan Stanley that
are due on October 30, 2011 and have a principal amount and issue price
of $10. The Notes will trade as a single, exchange-listed security.
However, the principal amount is initially reduce by underwriting
commissions of 1.20%, so that the Notes, in fact, are initially valued
at $9.88, which is known as the initial net entitlement value
(``Initial NEV''). Additional fees of 2% each year reduce the Net
Entitlement Value (``NEV''). Because the initial NEV is 1.20% less than
the issue price of the securities and because the 2% per annum
adjustment amount reduces the NEV over the term of the securities, the
BXN Index must increase for the investor to receive an amount upon
sale, exchange, redemption or at maturity equal to the issue price for
each security. Thus, unlike ordinary debt, the Notes have no guaranteed
return of principal and do not pay interest.\4\
---------------------------------------------------------------------------

    \4\ Telephone conference between Jonathan Cayne, Associate
General Counsel, Nasdaq, and Geoffrey Pemble, Special Counsel,
Division of Market Regulation (``Division''), Commission, on
November 1, 2005 (relating to additional descriptive material about
the Notes provided in prospectus supplement).
---------------------------------------------------------------------------

    The Notes will pay 9% per annum, payable monthly beginning November
30, 2005. If the investor exchanges the Notes, or Morgan Stanley calls
the Notes the investor will receive accrued but unpaid interim payments
on the exchanged or redeemed Notes in exchange for a reduction of the
NEV of the Notes (``Adjustment Amount''). This Adjustment Amount takes
into account the interim payments on the Notes. As a result, for
investing in the Notes, the investor will receive current income in the
form of the interim payments on the Notes in exchange for a reduction
in the NEV of the Notes.\5\
---------------------------------------------------------------------------

    \5\ Id.
---------------------------------------------------------------------------

    The payout on the Notes upon exchange, upon redemption, or at
maturity will be based on the applicable NEV of the securities
determined on a valuation date, as compared to the Initial NEV.
    For each trading day, the NEV is equal to $9.88 (e.g., the Initial
NEV) multiplied by the ratio of the BXN Index closing value on that
trading day over the closing value of the Index on the pricing date
(``Initial BXN Index Value'') minus the Adjustment Amount \6\ as of
that trading day. In other words:
---------------------------------------------------------------------------

    \6\ On any trading day, the Adjustment Amount is the sum of (i)
9% multiplied by the Issue Price multiplied by the number of
calendar days since the previous calculation of NEW divided by 365
plus (ii) 2% multiplied by NEV on the previous trading day
multiplied by the number of calendar days since the previous
calculation of NEV divided by 365.
[GRAPHIC] [TIFF OMITTED] TN10NO05.313

Where
    T = each trading day
    BXNT = the closing value of the BXN Index on T.

    The Notes are cash-settled in U.S. dollars and do not give the
holder any right to receive a portfolio security, dividend payments or
any other ownership right or interest in the portfolio or index of
securities comprising the Index. The Commission has previously approved
the listing of options on, and other securities the performance of
which have been linked to or based on similar and parallel buy-write
indexes.\7\
---------------------------------------------------------------------------

    \7\ The BXN Index is similar to Chicago Board Options Exchange's
(``CBOE'') BXM and BXD indexes, which are buy-writes on the S&P 500
and the Dow Jones Industrial Average, respectively. The Commission
has previously, on multiple occasions, approved the listing and
trading of notes linked to the BXM and BXD indexes. See Securities
Exchange Act Release Nos. 51966, (July 1, 2005), 70 FR 40069 (July
12, 2005) (approving an exception to the requirement in the American
Stock Exchange LLC (``Amex'') ``generic'' listing standards pursuant
to Rule 19b-4(e) for index-linked notes that index values be
disseminated at least every 15 seconds, thereby allowing the listing
and trading of notes linked to the BXM and BXD even though the BXM
and BXD values are not so disseminated); 51840 (June 14, 2005), 70
FR 35468 (June 20, 2005) (approving the listing and trading of
JPMorgan Chase notes linked to the BXD Index); 51634 (April 29,
2005), 70 FR 24138 (May 6, 2005) (approving the listing and trading
of Wachovia notes linked to the BXM Index); 51426 (March 23, 2005),
70 FR 16315 (March 30, 2005) (approving the listing and trading of
Morgan Stanley notes linked to the BXM Index); and 50719 (November
22, 2004), 69 FR 69644 (November 30, 2004) (approving the listing
and trading of Morgan Stanley notes linked to the BXM Index).
---------------------------------------------------------------------------

    Beginning in October 2008, upon at least 10 but not more than 30
days notice to the holders, Morgan Stanley may redeem the Notes each
quarter on certain dates specified in the prospectus (``Exchange
Date''). In addition, prior to October 2008, Morgan Stanley may redeem
the Notes for mandatory exchange on any Exchange Date if the NEV (which
is a value calculated as described in the immediately following
paragraph) equals or is less than $2.00 on any trading day.
Furthermore, during the period from January 2006 to July 2011, a holder
may exchange the Notes each quarter on certain specified dates for an
amount of cash for each security equal to the NEV, plus accrued but
unpaid interim payments, subject to a minimum of at least 10,000 Notes.
The payout on the Notes upon exchange, upon redemption, or at maturity
will be based on the applicable NEV of the securities determined on a
valuation date, as compared to the Initial NEV.
Description of the Index
    The BXN Index \8\ is a benchmark index designed to measure the
performance of a hypothetical ``buy-write'' \9\ strategy on the Nasdaq-
100 Index.\10\ Developed by the CBOE in

cooperation with Nasdaq, the Index was initially announced in 2005.\11\
The CBOE developed the BXN Index in response to requests by options
portfolio managers that the CBOE provide an objective benchmark for
evaluating the performance of buy-write strategies, one of the most
popular option trading strategies. In addition, the BXN Index could
provide investors with a straightforward indicator of the risk-reducing
character of options.
---------------------------------------------------------------------------

    \8\ Morgan Stanley and Nasdaq have entered into a non-exclusive
license agreement providing for the use of the Index by Morgan
Stanley in connection with the Notes. Nasdaq is not responsible for
and will not participate in the issuance of the Notes.
    \9\ A ``buy-write'' is a conservative options strategy in which
an investor buys a stock or portfolio and writes call options on the
stock or portfolio. This strategy is also known as a ``covered
call'' strategy. A buy-write strategy provides option premium income
to cushion decreases in the value of an equity portfolio, but will
underperform stocks in a rising market. A buy-write strategy tends
to lessen overall volatility in a portfolio.
    \10\ The BXN Index consists of a long position in the component
securities of the Nasdaq-100 Index and options on the Nasdaq-100
Index. The Commission has approved the listing of numerous
securities linked to the performance of the Nasdaq-100 Index as well
as options on the Nasdaq-100 Index. See, e.g., Securities Exchange
Act Release Nos. 50916 (December 22, 2004), 69 FR 78508 (December
30, 2004) (approving the listing and trading of Performance
Leveraged Upside Securities based on the value of the Nasdaq-100
Index); 48065 (June 19, 2003), 68 FR 38414 (June 27, 2003)
(approving the listing and trading of Performance Leveraged Upside
Securities based on the value of the Nasdaq-100 Index); 45429
(February 11, 2002), 67 FR 7438 (February 19, 2002) (approving the
listing and trading of Enhanced Return Notes Linked to the Nasdaq-
100 Index); 45024 (November 5, 2001), 66 FR 56872 (November 13,
2001) (approving the listing and trading of Enhanced Return Notes
Linked to the Nasdaq-100 Index); 44913 (October 9, 2001), 66 FR
52469 (October 15, 2001) (approving the listing and trading of
Performance Leveraged Upside Securities based upon the performance
of the Nasdaq-100 Index); 43000 (June 30, 2000), 65 FR 42409 (July
10, 2000) (approving the listing and trading of options based upon
one-tenth of the value of the Nasdaq-100 Index); 41119 (February 26,
1999), 64 FR 11510 (March 9, 1999) (approving the listing and
trading of Portfolio Depositary Receipts based on the Nasdaq-100
Index); and 33428 (January 5, 1994), 59 FR 1576 (January 11, 1994)
(approving the listing and trading of options on the Nasdaq-100
Index).
    As of the close of business on September 30, 2005, the adjusted
market capitalization of the securities included in the Index ranged
from a high of $178 billion to a low of $3 billion. As of the same
date, the average daily trading volume for these same securities
since the beginning of 2005 ranged from a high of 67 million shares
to a low of 450,000 shares.
    \11\ See supra note 7.
---------------------------------------------------------------------------

    The BXN Index is a passive total return index based on (1) buying a
portfolio consisting of the component stocks of the Nasdaq-100, and (2)
``writing'' (or selling) near-term Nasdaq-100 call options with the
closest out-of-the money strike price, generally on the third Friday of
each month. This strategy consists of a hypothetical portfolio
consisting of a ``long'' position indexed to the Nasdaq-100 on which
are deemed sold a succession of one-month, at-the-money call options on
the Nasdaq-100 listed on the CBOE. Dividends paid on the component
stocks underlying the Nasdaq-100 and the dollar value of option premium
deemed received from the sold call options are functionally
``reinvested'' in the covered Nasdaq-100 portfolio.
    The value of the BXN Index on any given date will equal: (1) The
value of the BXN Index on the previous day, multiplied by (2) the daily
rate of return \12\ on the covered Nasdaq-100 portfolio on that date.
Thus, the daily change in the BXN Index reflects the daily changes in
value of the covered Nasdaq-100 portfolio, which consists of the
Nasdaq-100 (including dividends) and the component Nasdaq-100 option.
The daily closing price of the BXN Index is calculated and disseminated
by the CBOE on its Web site at http://www.cboe.com and via the Options

Pricing and Reporting Authority (``OPRA'') at the end of each trading
day. The value of the Nasdaq-100 Index is disseminated at least once
every fifteen (15) seconds throughout the trading day. Nasdaq believes
that the intraday dissemination of the Nasdaq-100 Index along with the
ability of investors to obtain real-time, intraday Nasdaq-100 call
option pricing provides sufficient transparency regarding the BXN
Index.\13\ In addition, as indicated above, the value of the BXN Index
is calculated once every trading day, thereby providing investors with
a daily value of such ``hypothetical'' buywrite options strategy on the
Nasdaq-100.
---------------------------------------------------------------------------

    \12\ The daily rate of return on the covered Nasdaq-100
portfolio is based on (a) the change in the closing value of the
stocks in the Nasdaq-100 portfolio, (b) the value of ordinary cash
dividends on the stocks underlying the Nasdaq-100 that are trading
``exdividend'' on that date (that is, when transactions in the stock
on an organized securities exchange or trading system no longer
carry the right to receive that dividend or distribution) as
measured from the close in trading on the previous day and (c) the
change in the market price of the call option.
    \13\ Call options on the Nasdaq-100 are traded on the CBOE, and
both last sale and quotation information for the call options are
disseminated in real-time through OPRA. Nasdaq states that the value
of the BXN can be readily approximated as a function of observable
market prices throughout the trading day. In particular, such a
calculation would require information on the current price of the
Nasdaq-100 Index and specific nearest-to-expiration call and put
options on that Index. These components trade in highly liquid
markets, and real-time prices are available continuously throughout
the trading day from a number of sources including Bloomberg and the
CBOE.
---------------------------------------------------------------------------

    As noted above, the Index is not calculated or disseminated
continuously throughout the trading day. Instead, the CBOE calculates
the value of the Index shortly after the close.\14\ In addition, CBOE
will disseminate daily an updated value of the amount investors would
receive for the Notes if exchanged or redeemed (``Indicative Value'').
The Indicative Value equals the performance of the Index less fees and
other adjustment amounts, if any. The Indicative Value is calculated by
the CBOE after the close of trading and after the BXN is calculated for
use by investors during the next trading day. It is designed to provide
investors with a daily reference value of the adjusted Index. The
Indicative Value may not reflect the precise value of the Notes.
---------------------------------------------------------------------------

    \14\ The Commission previously approved the listing and trading
of notes linked to similar CBOE indexes (BXM and BXD) that are not
disseminated every 15 seconds. The Commission also recently approved
an exception to the 15-second requirement in the American Stock
Exchange ``generic'' listing standards for notes linked to these
indexes. See supra note 7.
---------------------------------------------------------------------------

    As stated below, in the event the calculation and dissemination of
the Index is discontinued, Nasdaq will consult with the Commission and
will prohibit the continued listing of the Notes unless otherwise
authorized by the Commission.\15\
---------------------------------------------------------------------------

    \15\ Prior to such change in the manner in which the Index is
calculated, or in the event of any Index substitution, Nasdaq will
file a proposed rule change pursuant to Rule 19b-4, which must be
approved by the Commission prior to continued listing and trading in
the Notes.
---------------------------------------------------------------------------

Listing and Trading Rules
    Under NASD Rule 4420(f), Nasdaq may approve for listing and trading
innovative securities that cannot be readily categorized under
traditional listing guidelines.\16\ Nasdaq proposes to list and trade
Notes based on the BXN Index under NASD Rule 4420(f).
---------------------------------------------------------------------------

    \16\ See Securities Exchange Act Release No. 32988 (September
29, 1993); 58 FR 52124 (October 6, 1993).
---------------------------------------------------------------------------

    The Notes, which will be registered under Section 12 of the Act,
will initially be subject to Nasdaq's listing criteria for other
securities under NASD Rule 4420(f). Specifically, under NASD Rule
4420(f)(1):
    (A) The issuer shall have assets in excess of $100 million and
stockholders' equity of at least $10 million.\17\ In the case of an
issuer which is unable to satisfy the income criteria set forth in Rule
4420(a)(1), Nasdaq generally will require the issuer to have the
following: (i) Assets in excess of $200 million and stockholders'
equity of at least $10 million; or (ii) assets in excess of $100
million and stockholders' equity of at least $20 million;
---------------------------------------------------------------------------

    \17\ Morgan Stanley satisfies this listing criterion.
---------------------------------------------------------------------------

    (B) There must be a minimum of 400 holders of the security;
provided, however, that if the instrument is traded in $1,000
denominations, there must be a minimum of 100 holders;
    (C) For equity securities designated pursuant to this paragraph,
there must be a minimum public distribution of 1,000,000 trading units;
    (D) The aggregate market value/principal amount of the security
will be at least $4 million.

    In addition, Morgan Stanley satisfies the listed marketplace
requirement set forth in NASD Rule 4420(f)(2).\18\ Lastly, pursuant to
NASD Rule 4420(f)(3), prior to the commencement of trading of the
Notes, Nasdaq will distribute a circular

to members providing guidance regarding compliance responsibilities and
requirements, including suitability recommendations, and highlighting
the special risks and characteristics of the Notes. In particular,
Nasdaq will advise members recommending a transaction in the Notes to:
(1) Determine that such transaction is suitable for the customer; and
(2) have a reasonable basis for believing that the customer can
evaluate the special characteristics of, and is able to bear the
financial risks of, such transaction.
---------------------------------------------------------------------------

    \18\ NASD Rule 4420(f)(2) requires issuers of securities
designated pursuant to this paragraph to be listed on The Nasdaq
National Market or the New York Stock Exchange, Inc. (``NYSE'') or
be an affiliate of a company listed on The Nasdaq National Market or
the NYSE; provided, however, that the provisions of NASD Rule 4450
will be applied to sovereign issuers of ``other'' securities on a
case-by-case basis.
---------------------------------------------------------------------------

    The Notes will be subject to Nasdaq's continued listing criterion
for other securities pursuant to NASD Rule 4450(c). Under this
criterion, the aggregate market value or principal amount of publicly
held units must be at least $1 million. The Notes also must have at
least two registered and active market makers, which is a continued
listing requirement under NASD Rule 4310(c)(1). In addition, Nasdaq
will commence delisting or removal proceedings with respect to the
Notes (unless the Commission has approved the continued trading of the
Notes) under any of the following circumstances:
    (i) If the aggregate market value or the principal amount of the
Notes publicly held is less than $400,000;
    (ii) If the value of the Index is no longer calculated or widely
disseminated as described above in this filing; or
    (iii) If such other event shall occur or condition exist which, in
the opinion of Nasdaq, makes further dealings on Nasdaq inadvisable.
    Nasdaq will also consider prohibiting the continued listing of the
Notes if Morgan Stanley is not able to meet its obligations on the
Notes. The Notes will be subject to the NASD's existing trading halt
rules.
    Since the Notes will be deemed equity securities for the purpose of
NASD Rule 4420(f), the NASD and Nasdaq's existing equity trading rules
will apply to the Notes. First, pursuant to NASD Rule 2310 and IM-2310-
2, members must have reasonable grounds for believing that a
recommendation to a customer regarding the purchase, sale or exchange
of any security is suitable for such customer upon the basis of the
facts, if any, disclosed by such customer as to his other security
holdings and as to his financial situation and needs.\19\ In addition,
as previously described, Nasdaq will distribute a circular to members
providing guidance regarding compliance responsibilities and
requirements, including suitability recommendations, and highlighting
the special risks and characteristics of the Notes. Furthermore, the
Notes will be subject to the equity margin rules. Lastly, the regular
equity trading hours of 9:30 a.m. to 4 p.m. will apply to transactions
in the Notes.
---------------------------------------------------------------------------

    \19\ NASD Rule 2310(b) requires members to make reasonable
efforts to obtain information concerning a customer's financial
status, a customer's tax status, the customer's investment
objectives, and such other information used or considered to be
reasonable by such member or registered representative in making
recommendations to the customer.
---------------------------------------------------------------------------

Surveillance
    Nasdaq represents that NASD's surveillance procedures are adequate
to properly monitor the trading of the Notes. Specifically, NASD will
rely on its current surveillance procedures governing equity securities
and will include additional monitoring on key pricing dates, such as
redemption, call, and maturity dates.\20\
---------------------------------------------------------------------------

    \20\ Telephone conference between Jonathan Cayne, Associate
General Counsel, Nasdaq, and Geoffrey Pemble, Special Counsel,
Division of Market Regulation, Commission, on November 1, 2005.
---------------------------------------------------------------------------

    Pursuant to Rule 10A-3 of the Act and Section 3 of the Sarbanes-
Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745 (2002), Nasdaq
will prohibit the initial or continued listing of any security of an
issuer that is not in compliance with the requirements set forth
therein.
    Morgan Stanley will deliver a prospectus in connection with every
purchase of the Notes. The procedure for the delivery of a prospectus
will be the same as Morgan Stanley's current procedure involving
primary offerings.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 15A of the Act,\21\ in general, and with
Section 15A(b)(6) of the Act,\22\ in particular, in that the proposal
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and,
in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78o-3.
    \22\ 15 U.S.C. 78o-3(6).
---------------------------------------------------------------------------

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

    Nasdaq does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.

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

    Written comments were neither solicited nor received.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change, as amended, 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 e-mail to<EMAIL_ADDRESS>Please include

File Number SR-NASD-2005-118 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-9303.

All submissions should refer to File Number SR-NASD-2005-118. This file
number should be included on the subject line if e-mail 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 inspection and
copying in the Commission's Public Reference Room. Copies of such
filing also will be available for inspection and copying at the
principal office of the NASD. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NASD-2005-118 and should be submitted on or before
December 1, 2005.

IV. Commission's Findings and Order Granting Accelerated Approval of
the Proposed Rule Change

    Nasdaq requests that the Commission approve this filing on an
accelerated basis since it raises no new or novel issues and will
enable Nasdaq to accommodate the timetable of listing the Notes. In
this regard, Nasdaq notes that the Commission has previously approved
the listing of securities the performance of which has been linked to
the Index.\23\
---------------------------------------------------------------------------

    \23\ See supra note 10.
---------------------------------------------------------------------------

    After careful review, the Commission finds that the proposed rule
change is consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a national securities association,
and, in particular, the requirements of Section 15A of the Act.\24\
Specifically, the Commission finds that the proposal is consistent with
Section 15A(b)(6) of the Act, which requires that the rules be designed
to promote just and equitable principles of trade, foster cooperation
and coordination with persons engaged in processing information with
respect to and facilitating transactions in securities, as well as to
remove impediments to and perfect the mechanism of a free and open
market, and, in general, to protect investors and the public
interest.\25\
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78o-3.
    \25\ In approving the proposed rule, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

    In approving the product, the Commission recognizes that the Index
is a passive total return index based on (1) buying a portfolio
consisting of the component stocks of the Nasdaq-100, and (2)
``writing'' (or selling) near-term Nasdaq-100 call options, with the
closest out-of-the money strike price, generally on the third Friday of
each month. Given the large trading volume and capitalization of the
compositions of the stocks underlying the Index, the Commission
believes that the listing and trading of the Notes that are linked to
the BXN Index should not unduly impact the market for the underlying
securities compromising the Nasdaq-100 or raise manipulative
concerns.\26\ Moreover, the issuers of the underlying securities
comprising the Nasdaq-100 are subject to reporting requirements under
the Act, and all of the component stocks are either listed or traded
on, or traded through the facilities of, U.S. securities markets.
---------------------------------------------------------------------------

    \26\ The issuer, Morgan Stanley, disclosed in the prospectus
that the original issue price of the Notes includes commissions (and
the secondary market prices are likely to exclude commissions) and
Morgan Stanley's costs of hedging its obligations under the Notes.
These costs could increase the initial value of the Notes, thus
affecting the payment investors receive at maturity. Additionally,
the issuer discloses in the prospectus that the hedging activities
of its affiliates, including selling call options on the Nasdaq-100,
could affect the value of these call option during the half hour
period in which their value is determined for purposes of inclusion
in the BXN Index. Such hedging activity must, of course, be
conducted in accordance with applicable regulatory requirements.
---------------------------------------------------------------------------

    The Commission also believes that any concerns that a broker-
dealer, such as Morgan Stanley, or a subsidiary providing a hedge for
the issuer, will incur undue position exposure are minimized by the
size of the Notes issuance in relation to the net worth of Morgan
Stanley.\27\
---------------------------------------------------------------------------

    \27\ See Securities Exchange Act Release Nos. 44913 (October 9,
2001), 66 FR 52469 (October 15, 2001) (order approving the listing
and trading of notes whose return is based on the performance of the
Nasdaq-100 Index) (SR-NASD-2001-73); 44483 (June 27, 2001), 66 FR
35677 (July 6, 2001) (order approving the listing and trading of
notes whose return is based on a portfolio of 20 securities selected
from the Amex Institutional Index) (File No. SR-Amex-2001-40); and
3774 (September 27, 1996), 61 FR 52480 (October 7, 1996) (order
approving the listing and trading of notes whose return is based on
a weighted portfolio of healthcare/biotechnology industry
securities) (SR-Amex-96-27).
---------------------------------------------------------------------------

    Finally, the Commission notes that the value of the Index will be
calculated and disseminated by CBOE once every trading day after the
close of trading. However, the Commission notes that the value of the
Nasdaq-100 will be widely disseminated at least once every fifteen
seconds throughout the trading day and that investors are able to
obtain real-time call option pricing on the Nasdaq-100 Index during the
trading day. Further, the Indicative Value, which will be calculated by
the CBOE after the close of trading and after the CBOE calculates the
BXN Index for use by investors the next trading day, is designed to
provide investors with a daily reference value of the adjusted Index.
    Further, the Commission notes that the Nasdaq has agreed to
undertake to delist the Notes in the event that CBOE ceases to
calculate and disseminate the Index, and Morgan Stanley is unable to
arrange to have the BXN Index calculated and widely disseminated
through a third party.
    The Commission finds good cause for approving the proposed rule
change prior to the 30th day after the date of publication of the
notice of filing thereof in the Federal Register. Nasdaq has requested
accelerated approval because this product is similar to several other
instruments currently listed and traded on the Nasdaq.\28\
Additionally, the Notes will be listed pursuant to Nasdaq's existing
hybrid security listing standards as described above. Therefore, the
Commission finds good cause, consistent with Section 19(b)(2) of the
Act,\29\ to approve the proposal on an accelerated basis.
---------------------------------------------------------------------------

    \28\ See supra not 10.
    \29\ 15 U.S.C. 78f(b)(5) and 78s(b)(2).
---------------------------------------------------------------------------

    Accordingly, the Commission believes there is good cause,
consistent with Sections 15A(b)(6) and 19(b)(2) of the Act,\30\ to
approve the proposal, on an accelerated basis.
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78o3(b)(6) and 78s(b)(2).
---------------------------------------------------------------------------

V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\31\ that the proposed rule change (SR-NASD-2005-118) is hereby
approved on an accelerated basis.
---------------------------------------------------------------------------

    \31\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\32\
---------------------------------------------------------------------------

    \32\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jonathan G. Katz,
Secretary.
[FR Doc. 05-22414 Filed 11-9-05; 8:45 am]

BILLING CODE 8010-01-P