Motis T. N., and Gilreath, J. P., 2002. Stimulation of Nutsedge Emergence With Chloropicrin. Annual International Research Conference on Methyl Bromide Alternatives and Emissions Reductions.

Nelsen K. A., Renner, K. A., and Penner, D., 2002. Yellow Nutsedge ( Cyperus esculentus) Control and Tuber Yield with Glyphosate and Glufosinate. Weed Technology 16: 360 365.

Shaw V. S., and Larson K. D., 1999. A meta analysis of Strawberry Yield Response to Pre plant Soil Fumigation with Combinations of Methyl Bromide chloropicrin and Four Alternative Systems. HortScience 34: 839 845.

California Studies:

Ajwa, H. Study conducted from 2001 through 2003. Iodomethane and Iodine  based Materials for Strawberry Production in California. Publication not specified, UC Davis.

Ajwa H., Kabir Z. and Fennimore S. Year of experiment or publication not specified. Drip Fumigation. UC Davis.

Ajwa H., Trout, T. Mueller S., Wilhelm S., Nelson S. D., Scoppe R. and Shately D., Application of Alternative Fumigants Through Drip Irrigation Systems. Phytopathology 92: 1349 1355.

Browne G. T., Becherer S. T., Bhat R. G. and Lee R. C. M.. 2003. Strategies for Management of Pytophthora on California Strawberries. USDA ARS, Department of Plant Pathology UC Davis, Monterey Bay Academy Field Day.

Duniway J. M., Status of Chemical Alternatives to Methyl Bromide for Pre plant Fumigation of Soil. 2002. Phytopathology 92: 1337 1343.

Duniway J., Dopkins D. and Hao J. 2003. Current Experiments on Alternatives to Methyl Bromide for Strawberry. Published for the Annual Monterey Bay Academy Field Day. Page 59 Fennimore S. A., and Valdez J., Study conducted in 2002 and 2003. Strawberry Herbicide Evaluation, Monterey Bay Academy. UC Davis, Publication not specified.

Kabir Z., Fennimore S., Ajwa H., and Roth K. Study conducted in 2001 and 2002. Chloropicrin and InlineTM Field Dose Response Study Under VIF and Standard Tarp: Weed Biomass and Weeding Time at Las Cuevas, CA. Publication not stated.

Kabir Z., Fennimore S., Ajwa, and Roth K. Study conducted in 2002 and 2003. The Efficacy of Agrizide and Plant Pro Alone or in Combination with Chloropicrin on Weeds Seeds and Native Weeds at La Cuevas, CA. Publication not stated.

Kabir Z., Fennimore S., Ajwa, and Roth K. Weed Control Efficacy of Drip and Shank Applied Iodomethane: Chloropicrin at MBA, CA 2002 3. Publication not specified.

Martin F. N., Management of Root Diseases of Strawberry. USDA ARS Publication not specified.

Martin F. N., Study conducted in 2002. The Use of Remote Sensing in Strawberry Production. Publication unspecified.

Martin F. N., and Bull D. T., Biological Approaches for Control of Root Pathogens of Strawberry. Phytopathology 92: 1356 1362.

Noling J. W. The Practical Realities of Alternatives to Methyl Bromide: Concluding Remarks. Presented at the Methyl Bromide Alternatives  Meeting the Deadlines Symposium. 2002. Published in Phytopathology 92: 1373 1375.

Subbarao K. V. Methyl Bromide Alternatives  Meeting the Deadlines. Presented at the 92nd Annual Meeting of the American Phytopathological Society, Augus 14, 2000. Accepted for publication by the American Phytopathological Society on 23 July 2002.

Trout, T. and Gartung J., 2003. Irrigation Water Requirements for California Strawberries. Not used, neither methyl bromide nor alternatives were evaluated, just water requirements. Publication unspecified.

Yates S. R., Gan J. Papiernik S. K. Dungan R. and Wang D. Reducing Fumigant Emissions After Soil Application. 2002. Phytopathology 92: 1344 1348. Page 60 APPENDIX A. 2006 Methyl Bromide Usage Numerical Index ( BUNI). 19,486 68%

2001 & 2002 Average % of 2001 & 2002 Average Requested Hectares %

11,109 74% 73%

not available not available not available 2,873 94% 100%

13,982 91% 95%

Kilograms ( kgs) Hectares ( ha) Use Rate ( kg/ ha) % Reduction 1,086,777 5,552 196 33%

230,332 1,528 151 34%

295,853 1,600 185 49%

1,612,962 8,680 177 37%

37% 35%

2006 Low High Low High Low High Low High Low High Low High Low HIGH LOW 202 196 0 0 0 0 0 0 67 47 15 15 0 0 72% 55%

151 151 0 0 90 90 40 30 0 0 0 0 0 0 94% 93%

202 185 40 40 1 1 40 30 0 0 0 0 0 0 60% 55%

Strip Bed Treatment Currently Use Alternatives? Research /

Transition Plans Tarps /

Deep Injection Used Pest

free Cert.

Requirement Change from Prior CUE Request (+/) Verified Historic MeBr Use /

State Frequency of Treatment Loss per Hectare (

US$/

ha) Loss per Kilogram of MeBr (

US$/

kg) Loss as a %

of Gross Revenue Loss as a %

of Net Revenue No Yes Yes Tarp No  Yes 1/ year 10,732 $ 53 $ 15% 79%

Yes Yes Yes Tarp No + Yes 1/ year 8,661 $ 47 $ 14%  128%

Yes Yes Yes Tarp No 0 Yes 1/ year 9,319 $ 62 $ 18% 42%

Notes Conversion Units: 1 Pound = Kilograms Hectare Regional Hectares**

Methyl Bromide Critical Use Exemption Process 2006 Methyl Bromide Usage Numerical Index ( BUNI) MOST LIKELY IMPACT VALUE Date: 26 Feb 2004 Average Hectares in the US:

Sector: STRAWBERRIES % of Average Hectares Requested:

2006 Amount of Request 2001 & 2002 Average Use* Quarantine and Pre Shipment Kilograms ( kgs) Hectares ( ha) Use Rate ( kg/ ha) Kilograms ( kgs) Hectares ( ha) Use Rate ( kg/ ha)

REGION 1,632,931 8,094 202 1,601,966 8,184 196 0%

350,534 2,317 151 278,967 1,851 151 0%

2,382,379 12,747 177 579,691 2,873 202 501,446 TOTAL OR AVERAGE 2,563,155 13,284 185 2,711 185 0%

2006 Nomination Options Subtractions from Requested Amounts ( kgs) Combined Impacts Adjustment ( kgs)

0%

2006 Request () Double Counting () Growth or 2002 CUE Comparison () Use Rate Difference () QPS HIGH LOW 1,632,931   48,709  1,140,640 871,322 350,534  104,977   230,823 228,368 579,691  32,659 45,586  300,868 275,795 Nomination Amount 2,563,155 2,563,155 2,425,520 2,331,225 2,331,225 1,672,331 1,375,485 9% 35% 46%

% Reduction from Initial Request 0% 0% 5%

Use Rate ( kg/ ha) (%) Karst Topography (%) 100 ft Buffer Zones 9%

(%) Key Pest Distribution Regulatory Issues (%) Unsuitable Terrain (%) Cold Soil Temp (%) Combined Impacts (%)

Other Considerations Dichotomous Variables ( Y/ N) Other Issues Economic Analysis CALIFORNIA EASTERN US FLORIDA 1,3 d+ pic/ Metam+ Pic 14% Yield Loss 1,3 d+ pic Quality/ Time/

Market Window/

Yield Loss (%) Marginal Strategy 14% Yield Loss Metam Sodium + Pic * SE Strawberry Consortium ( AL, AR, GA, NC, SC, TN, OH, NJ, VA) requested a greater quantity of Methyl Bromide from their 2002 CUE application, due to the inclusion of 4 new states ( Illinois, Kentucky, Louisiana, and Maryland) in the 2003 CUE Application,

0.453592 1 Acre = 0.404686 REGION REGION REGION CALIFORNIA EASTERN US FLORIDA CALIFORNIA EASTERN US FLORIDA Adjustments to Requested Amounts CALIFORNIA EASTERN US FLORIDA 14% Yield Loss Page 61 Footnotes for Appendix A: Values may not sum exactly due to rounding. 1. Average Hectares in the US   Average Hectares in the US is the average of 2001 and 2002 total hectares in the US in this crop when available. These figures were obtained from the USDA National Agricultural Statistics Service. 2. % of Average Hectares Requested  Percent (%) of Average Hectares Requested is the total area in the sector's request divided by the Average Hectares in the US. Note, however, that the NASS categories do not always correspond one to one with the sector nominations in the U. S. CUE nomination ( e. g., roma and cherry tomatoes were included in the applicant's request, but were not included in NASS surveys). Values greater than 100 percent are due to the inclusion of these varieties in the U. S. CUE request that were not included in the USDA NASS: nevertheless, these numbers are often instructive in assessing the requested coverage of applications received from growers. 3. 2006 Amount of Request   The 2006 amount of request is the actual amount requested by applicants given in total pounds active ingredient of methyl bromide, total acres of methyl bromide use, and application rate in pounds active ingredient of methyl bromide per acre. U. S. units of measure were used to describe the initial request and then were converted to metric units to calculate the amount of the US nomination. 4. 2001 & 2002 Average Use   The 2001 & 2002 Average Use is the average of the 2001 and 2002 historical usage figures provided by the applicants given in total pounds active ingredient of methyl bromide, total acres of methyl bromide use, and application rate in pounds active ingredient of methyl bromide per acre. Adjustments are made when necessary due in part to unavailable 2002 estimates in which case only the 2001 average use figure is used. 5. Quarantine and Pre Shipment   Quarantine and pre shipment ( QPS) hectares is the percentage (%) of the applicant's request subject to QPS treatments. 6. Regional Hectares, 2001 & 2002 Average Hectares   Regional Hectares, 2001 & 2002 Average Hectares is the 2001 and 2002 average estimate of hectares within the defined region. These figures are taken from various sources to ensure an accurate estimate. The sources are from the USDA National Agricultural Statistics Service and from other governmental sources such as the Georgia Acreage estimates. 7. Regional Hectares, Requested Acreage %  Regional Hectares, Requested Acreage % is the area in the applicant's request divided by the total area planted in that crop in the region covered by the request as found in the USDA National Agricultural Statistics Service ( NASS). Note, however, that the NASS categories do not always correspond one to one with the sector nominations in the U. S. CUE nomination ( e. g., roma and cherry tomatoes were included in the applicant's request, but were not included in NASS surveys). Values greater than 100 percent are due to the inclusion of these varieties in the U. S. CUE request that were not included in the USDA NASS: nevertheless, these numbers are often instructive in assessing the requested coverage of applications received from growers. 8. 2006 Nomination Options   2006 Nomination Options are the options of the inclusion of various factors used to adjust the initial applicant request into the nomination figure. 9. Subtractions from Requested Amounts   Subtractions from Requested Amounts are the elements that were subtracted from the initial request amount. 10. Subtractions from Requested Amounts, 2006 Request   Subtractions from Requested Amounts, 2006 Request is the starting point for all calculations. This is the amount of the applicant request in kilograms. 11. Subtractions from Requested Amounts, Double Counting  Subtractions from Requested Amounts, Double Counting is the estimate measured in kilograms in situations where an applicant has made a request for a CUE with an individual application while their consortium has also made a request for a CUE on their behalf in the consortium application. In these cases the double counting is removed from the consortium application and the individual application takes precedence. 12. Subtractions from Requested Amounts, Growth or 2002 CUE Comparison  Subtractions from Requested Amounts, Growth or 2002 CUE Comparison is the greatest reduction of the estimate measured in kilograms of either the difference in the amount of methyl bromide requested by the applicant that is greater than that historically used or treated at a higher use rate or the difference in the 2006 request from an applicant's 2002 CUE application compared with the 2006 request from the applicant's 2003 CUE application. 13. Subtractions from Requested Amounts, QPS  Subtractions from Requested Amounts, QPS is the estimate measured in kilograms of the request subject to QPS treatments. This subtraction estimate is calculated as the 2006 Request minus Double Counting, minus Growth or 2002 CUE Comparison then Page 62 multiplied by the percentage subject to QPS treatments. Subtraction from Requested Amounts, QPS = ( 2006 Request   Double Counting   Growth)*( QPS %) 14. Subtraction from Requested Amounts, Use Rate Difference   Subtractions from requested amounts, use rate difference is the estimate measured in kilograms of the lower of the historic use rate or the requested use rate. The subtraction estimate is calculated as the 2006 Request minus Double Counting, minus Growth or 2002 CUE Comparison, minus the QPS amount, if applicable, minus the difference between the requested use rate and the lowest use rate applied to the remaining hectares. 15. Adjustments to Requested Amounts   Adjustments to requested amounts were factors that reduced to total amount of methyl bromide requested by factoring in the specific situations were the applicant could use alternatives to methyl bromide. These are calculated as proportions of the total request. We have tried to make the adjustment to the requested amounts in the most appropriate category when the adjustment could fall into more than one category. 16. (%) Karst topography   Percent karst topography is the proportion of the land area in a nomination that is characterized by karst formations. In these areas, the groundwater can easily become contaminated by pesticides or their residues. Regulations are often in place to control the use of pesticide of concern. Dade County, Florida, has a ban on the use of 1,3D due to its karst topography. 17. (%) 100 ft Buffer Zones   Percentage of the acreage of a field where certain alternatives to methyl bromide cannot be used due the requirement that a 100 foot buffer be maintained between the application site and any inhabited structure. 18. (%) Key Pest Impacts  Percent (%) of the requested area with moderate to severe pest problems. Key pests are those that are not adequately controlled by MB alternatives. For example, the key pest in Michigan peppers, Phytophthora spp. infests approximately 30% of the vegetable growing area. In southern states the key pest in peppers is nutsedge. 19. Regulatory Issues (%)  Regulatory issues (%) is the percent (%) of the requested area where alternatives cannot be legally used ( e. g., township caps) pursuant to state and local limits on their use. 20. Unsuitable Terrain (%)   Unsuitable terrain (%) is the percent (%) of the requested area where alternatives cannot be used due to soil type ( e. g., heavy clay soils may not show adequate performance) or terrain configuration, such as hilly terrain. Where the use of alternatives poses application and coverage problems. 21. Cold Soil Temperatures   Cold soil temperatures is the proportion of the requested acreage where soil temperatures remain too low to enable the use of methyl bromide alternatives and still have sufficient time to produce the normal ( one or two) number of crops per season or to allow harvest sufficiently early to obtain the high prices prevailing in the local market at the beginning of the season. 22. Combined Impacts (%)  Total combined impacts are the percent (%) of the requested area where alternatives cannot be used due to key pest, regulatory, soil impacts, temperature, etc. In each case the total area impacted is the conjoined area that is impacted by any individual impact. The effects were assumed to be independently distributed unless contrary evidence was available ( e. g., affects are known to be mutually exclusive). For example, if 50% of the requested area had moderate to severe key pest pressure and 50% of the requested area had karst topography, then 75% of the area was assumed to require methyl bromide rather than the alternative. This was calculated as follows: 50% affected by key pests and an additional 25% ( 50% of 50%) affected by karst topography. 23. Qualifying Area  Qualifying area ( ha) is calculated by multiplying the adjusted hectares by the combined impacts. 24. Use Rate  Use rate is the lower of requested use rate for 2006 or the historic average use rate. 25. CUE Nominated amount  CUE nominated amount is calculated by multiplying the qualifying area by the use rate. 26. Percent Reduction  Percent reduction from initial request is the percentage of the initial request that did not qualify for the CUE nomination. 27. Sum of CUE Nominations in Sector  Self explanatory. 28. Total US Sector Nomination  Total U. S. sector nomination is the most likely estimate of the amount needed in that sector. 29. Dichotomous Variables   dichotomous variables are those which take one of two values, for example, 0 or 1, yes or no. These variables were used to categorize the uses during the preparation of the nomination. 30. Strip Bed Treatment   Strip bed treatment is ` yes' if the applicant uses such treatment, no otherwise. 31. Currently Use Alternatives   Currently use alternatives is ` yes' if the applicant uses alternatives for some portion of pesticide use on the crop for which an application to use methyl bromide is made. Page 63 32. Research/ Transition Plans   Research/ Transition Plans is ` yes' when the applicant has indicated that there is research underway to test alternatives or if applicant has a plan to transition to alternatives. 33. Tarps/ Deep Injection Used   Because all pre plant methyl bromide use in the US is either with tarps or by deep injection, this variable takes on the value ` tarp' when tarps are used and ` deep' when deep injection is used. 34. Pest free cert. Required  This variable is a ` yes' when the product must be certified as ` pest free' in order to be sold 35. Other Issues. Other issues is a short reminder of other elements of an application that were checked 36. Change from Prior CUE Request This variable takes a `+' if the current request is larger than the previous request, a ` 0' if the current request is equal to the previous request, and a `` if the current request is smaller that the previous request. 37. Verified Historic Use/ State This item indicates whether the amounts requested by administrative area have been compared to records of historic use in that area. 38. Frequency of Treatment   This indicates how often methyl bromide is applied in the sector. Frequency varies from multiple times per year to once in several decades. 39. Economic Analysis   provides summary economic information for the applications. 40. Loss per Hectare   This measures the total loss per hectare when a specific alternative is used in place of methyl bromide. Loss comprises both the monetized value of yield loss ( relative to yields obtained with methyl bromide) and any additional costs incurred through use of the alternative. It is measured in current US dollars. 41. Loss per Kilogram of Methyl Bromide   This measures the total loss per kilogram of methyl bromide when it is replaced with an alternative. Loss comprises both the monetized value of yield loss ( relative to yields obtained with methyl bromide) and any additional costs incurred through use of the alternative. It is measured in current US dollars. 42. Loss as a % of Gross revenue   This measures the loss as a proportion of gross ( total) revenue. Loss comprises both the monetized value of yield loss ( relative to yields obtained with methyl bromide) and any additional costs incurred through use of the alternative. It is measured in current US dollars. 43. Loss as a % of Net Operating Revenue  This measures loss as a proportion of total revenue minus operating costs. Loss comprises both the monetized value of yield loss ( relative to yields obtained with methyl bromide) and any additional costs incurred through use of the alternative. It is measured in current US dollars. This item is also called net cash returns. 44. Quality/ Time/ Market Window/ Yield Loss (%)   When this measure is available it measures the sum of losses including quality losses, non productive time, missed market windows and other yield losses when using the marginal strategy. 45. Marginal Strategy  This is the strategy that a particular methyl bromide user would use if not permitted to use methyl bromide. Page 64 APPENDIX C. SUMMARY OF NEW APPLICANTS A number of new groups applied for methyl bromide for 2005 during this application cycle, as shown in the table below. Although in most cases they represent additional amounts for sectors that were already well characterized sectors, in a few cases they comprised new sectors. Examples of the former include significant additional country ( cured, uncooked) ham production; some additional request for tobacco transplant trays, and very minor amounts for pepper and eggplant production in lieu of tomato production in Michigan.

For the latter, there are two large requests: cut flower and foliage production in Florida and California (` Ornamentals') and a group of structures and process foods that we have termed ` Post Harvest NPMA' which includes processed ( generally wheat based foods), spices and herbs, cocoa, dried milk, cheeses and small amounts of other commodities. There was also a small amount requested for field grown tobacco.

The details of the case that there are no alternatives which are both technically and economically feasible are presented in the appropriate sector chapters, as are the requested amounts, suitably adjusted to ensure that no double counting, growth, etc. were included and that the amount was only sufficient to cover situations ( key pests, regulatory requirements, etc.) where alternatives could not be used.

The amount requested by new applicants is approximately 2.5% of the 1991 U. S. baseline, or about 1,400,000 pounds of methyl bromide, divided 40% for pre plant uses and 60% for postharvest needs.

The methodology for deriving the nominated amount used estimates that would result in the lowest amount of methyl bromide requested from the range produced by the analysis to ensure that adequate amounts of methyl bromide were available for critical needs. We are requesting additional methyl bromide in the amount of about 500,000 Kg, or 2% or the 1991 U. S. baseline, to provide for the additional critical needs in the pre plant and post harvest sector.

Applicant Name 2005 U. S. CUE Nomination ( lbs)

California Cut Flower Commission 400,000 National Country Ham Association 1,172 Wayco Ham Company 39 California Date Commission 5,319 National Pest Management Association 319,369 Michigan Pepper Growers 20,904 Michigan Eggplant Growers 6,968 Burley & Dark Tobacco Growers USA  Transplant Trays 2,254 Burley & Dark Tobacco Growers USA  Field Grown 28,980 Virginia Tobacco Growers  Transplant Trays 941 Michigan Herbaceous Perennials 4,200 Page 65 Ozark Country Hams 240 Nahunta Pork Center 248 American Association of Meat Processors 296,800 Total lbs 1,087,434 Total kgs 493,252


[Federal Register Volume 80, Number 158 (Monday, August 17, 2015)]
[Notices]
[Pages 49285-49286]
[FR Doc No: 2015-20159]

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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-101, OMB Control No. 3235-0082]

Proposed Collection; Comment Request

Upon Written Request Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE., Washington, DC
20549-2736.

Extension: Form 11-K.

    Notice is hereby given that, pursuant to the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the collection of
information summarized below. The Commission plans to submit this
existing collection of information to the Office of Management Budget
for extension and approval.
    Form 11-K (17 CFR 249.311) is the annual report designed for use by
employee stock purchase, savings and similar plans to comply with the
reporting requirements under Section 15(d) of the Securities and
Exchange Act of 1934 (the ``Exchange Act'') (15 U.S.C. 78o(d)). Section
15(d) establishes a periodic reporting obligation for every issuer of a
class of securities registered under the Securities Act of 1933 (the
``Securities Act'') (15 U.S.C. 77a et seq.). Form 11-K provides
employees of an issuer with financial information so that they can
assess the performance of the investment vehicle or stock plan. Form
11-K takes approximately 30 burden hours per response and is filed by
1,761 respondents for total of 52,830 burden hours.
    Written comments are invited on: (a) Whether this proposed
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information will
have practical utility; (b) the accuracy of the agency's estimate of
the burden imposed by the collection of information; (c) ways to
enhance the quality, utility, and clarity of the information collected;
and (d) ways to minimize the burden of the collections of information
on respondents, including through the use of automated collection
techniques or other forms of information technology. Consideration will
be given to comments and suggestions submitted in writing within 60
days of this publication.
    Please direct your written comments to Pamela Dyson, Chief
Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon,

100 F Street NE., Washington, DC 20549; or send an email to:
<EMAIL_ADDRESS>
    August 11, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015-20159 Filed 8-14-15; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register: September 16, 2008 (Volume 73, Number 180)]
[Rules and Regulations]
[Page 53383-53384]
[DOCID:fr16se08-8]

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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 385

FMCSA Policy on Considering the Preventability of Crashes in
Administrative Review Requests of Hazardous Materials Safety Permit
Denials Based Upon Crash Rates in the Top 30 Percent of the National
Average Under 49 CFR 385.407

AGENCY: Federal Motor Carrier Safety Administration (FMCSA).

ACTION: Notice of enforcement policy.

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SUMMARY: FMCSA may not issue a hazardous materials safety permit
(safety permit) to a motor carrier that has a crash rate, driver,
vehicle or hazardous material out-of-service rate in the top 30 percent
of the national average pursuant to 49 CFR 385.407. This document
provides notice of FMCSA policy that it will consider preventability
when a motor carrier contests the denial of a safety permit based upon
a crash rate in the top thirty percent of the national average and
presents compelling evidence that one or more of the crashes listed in
the Motor Carrier Management Information System (MCMIS) was not
preventable and thus not reflective of the motor carrier's suitability
to transport the type and quantity of hazardous materials that require
a safety permit. Preventability is determined by the following
standard: If a driver who exercises normal judgment and foresight could
have foreseen the possibility of the accident that in fact occurred,
and avoided it by taking steps within his/her control which would not
have risked causing another kind of mishap, the accident was
preventable. FMCSA currently uses this standard in evaluating accident
factors under its safety rating process.

DATES: Effective Date: September 16, 2008.

FOR FURTHER INFORMATION CONTACT: James O. Simmons, Office of
Enforcement and Compliance, Hazardous Materials Division, 1200 New
Jersey Avenue, SE., Washington, DC 20590,<PHONE_NUMBER> (voice),
<EMAIL_ADDRESS>(e-mail), Debra S. Straus, Office of the Chief
Counsel,<PHONE_NUMBER> (voice), or<EMAIL_ADDRESS>(e-mail).

SUPPLEMENTARY INFORMATION: On June 30, 2004, FMCSA issued a Final Rule
containing the regulations implementing the safety permit program. 69
FR 39350. The Final Rule, codified at 49 CFR part 385, identifies who
must hold a safety permit, establishes the application process for a
safety permit, and the conditions that must be satisfied before FMCSA
will issue a safety permit to a carrier. These conditions are set out
in 49 CFR 385.407.

Background

    Section 385.407 requires that a carrier have a ``Satisfactory''
safety rating, certify that it has a satisfactory security program, and
be properly registered with the Pipeline and Hazardous Materials Safety
Administration (PHMSA). 49 CFR 385.407(a)(1), 385.407(b) & (c). Section
385.407(a)(2) additionally states that:

    FMCSA will not issue a safety permit to a motor carrier that:
(ii) Has a crash rate in the top 30 percent of the national average
as indicated in the FMCSA Motor Carrier Management Information
System (MCMIS); or
    (iii) Has a driver, vehicle, hazardous materials, or total out-
of-service rate in the top 30 percent of the national average as
indicated in the MCMIS;

    The safety permit requirement became effective for motor carriers
on the date after January 1, 2005, when the motor carrier was required
to file a Motor Carrier Identification Report Form (MCS-150) according
to a schedule set forth in 49 CFR 390.19(a). The application for the
safety permit was incorporated into the MCS-150, as an expanded form
entitled ``MCS-150B or Combined Motor Carrier Identification Report and
HM Permit Application.''
    On or about January 3, 2005, the Office of Enforcement and
Compliance (OEC) published on its public Web site \1\ the formula used
to determine the national averages and the crash rates and driver,
vehicle and hazmat out-of-service (OOS) rates that establish the
thresholds for the ``top 30 percent of the national average.'' The Web
site also instructed motor carriers on how to calculate their own out-
of-service rates. This information on calculating the national
averages, crash rates and out-of-service rates was subsequently
published in the Federal Register. 72 FR 62795 (Nov. 7, 2007).
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    \1\ http://www.safersys.org/HazMatRatesPost.aspx#OOSRates.
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Crash Rates

    FMCSA may not issue a safety permit to a motor carrier that has a
crash rate in the top 30 percent of the national average as indicated
in the MCMIS. 49 CFR 385.407(a)(2)(ii). The threshold crash rate above
which a carrier falls within the worst performing or top thirty percent
of the national average is recalculated every two years using the crash
data from the previous two years. The cut-off for motor carrier crash
rates above which a carrier will fall into the top 30 percent of the
national average has remained at 0.125 since the inception of the
program.
    To determine the crash rate for an individual carrier that is
applying for a safety permit, FMCSA examines one year of crash data.
FMCSA divides the number of crashes for the previous twelve-month
period by the total number of power units that the motor carrier
operated during that twelve-month period. For example, if a motor
carrier had 2 crashes and 10 power units, the crash rate would be 0.20
based upon a calculation of (2 / 10 = 0.20). FMCSA examines one year of
data to remain consistent with FMCSA practice of reviewing one year of
records during a compliance review. FMCSA does not consider a single
crash to be statistically valid. Thus, crash rates will be calculated
only for carriers with more than one crash in the relevant twelve-month
period.

Preventability

    Petitions for rulemaking filed by the Institute of Makers of
Explosives and The Fertilizer Institute requested the Agency to
consider crash preventability when evaluating a motor carrier's crash
rate under the safety permit program, in the same manner that accident
preventability is considered when a motor carrier contests an
unfavorable safety rating. In the Agency's response to these petitions
issued on June 21, 2007, the FMCSA Administrator agreed that the same
preventability criteria used in assessing the ``Accident Factor'' under
49 CFR part 385, Appendix A.III.B(d), should be applied when a carrier
contests denial of a safety permit application based upon its crash
rate and provides compelling evidence a crash was not preventable.
    The preventability standard found in Appendix A to Part 385,
section III.B(d) states:

    The FMCSA will continue to consider preventability when a new
entrant contests the evaluation of the accident factor by presenting
compelling evidence that the recordable rate is not a fair means of
evaluating its accident factor. Preventability will be determined
according to the following standard: ``If a driver who exercises
normal judgment and foresight could have foreseen the possibility of
the accident that in fact

occurred, and avoided it by taking steps within his/her control
which would not have risked causing another kind of mishap, the
accident was preventable.'' (Emphasis added.)

    The intent of the safety permit program is to hold motor carriers
that transport permitted materials to a higher safety standard due to
the potential risks associated with transportation of these high-risk
hazardous materials. In applying this standard to the safety fitness
rating process, FMCSA recognizes that crashes in which the motor
carrier's driver was not at fault and could not have reasonably avoided
without further risk, should not adversely reflect on the safety
fitness of the motor carrier. Similarly, denial of a safety permit
based upon crashes which were not preventable, does not have a
reasonable correlation to the safety standard required under the safety
permit program.
    In the safety rating context, FMCSA considers preventability when
the carrier contests the evaluation of the accident factor by
presenting compelling evidence that the recordable rate is not a fair
means of evaluating the carrier's fitness under the accident factor.
Similarly, FMCSA will consider preventability of crashes under the
safety permit program. When a carrier contests the denial of its safety
permit application based upon a crash rate that falls into the top
thirty percent of the national average and submits compelling evidence
that a crash or crashes listed in the MCMIS were not preventable, it
should not be included in the crash rate calculation. The
preventability standard that will be applied is the same standard that
is used in the safety rating context.

Preventability Policy Procedures

    Accordingly, FMCSA is implementing the following policy procedures:
If a motor carrier's safety permit application is denied based upon a
crash rate greater that the safety permit program crash rate threshold,
the carrier may submit evidence to show that one or more crashes were
not preventable. In order to preserve the right to seek administrative
review of FMCSA's determination on the preventability of one or more
crashes, the carrier should submit such evidence as part of a request
for administrative review pursuant to Sec.  385.423(c). The carrier
should submit the request to FMCSA's Chief Safety Officer (CSO) and the
Office of Chief Counsel, and must include adequate proof that the crash
or crashes in question were not preventable. The standard for
determining preventability is the same as the standard found in
Appendix A to Part 385:

    If a driver who exercises normal judgment and foresight could
have foreseen the possibility of the accident that in fact occurred,
and avoided it by taking steps within his/her control which would
not have risked causing another kind of mishap, the accident was
preventable.

    It is incumbent upon the carrier to provide reliable and objective
evidence that the accident was not preventable. Such evidence may
include but is not limited to police reports and other verifiable
government reports or law enforcement and witness statements. The issue
of whether a crash was or was not preventable under the above-stated
standard will be initially addressed by the FMCSA Office of Enforcement
and Compliance, Hazardous Materials Division in consultation with the
Office of Chief Counsel, Enforcement and Litigation Division. If the
initial determination results in a finding that one or more crashes
were not preventable, the safety permit application will be reprocessed
with the relevant crash or crashes removed from consideration in the
crash rate calculation. If removal of the crash(es) results in a crash
rate calculation that falls below the crash rate cut-off for the top 30
percent of the national average and no other disqualifying factors
exist, FMCSA will issue a safety permit to the carrier. If the Office
of Enforcement and the Office of Chief Counsel determine that the
evidence submitted does not support a finding that the crash or crashes
were preventable, the motor carrier may pursue its request for
administrative review by the Chief Safety Officer of the denial of its
safety permit application based upon its crash rate. The request for
administrative review must have been timely filed and served in
accordance with the requirements of 49 CFR 385.423.

    Issued on: September 10, 2008.
John H. Hill,
Administrator.
 [FR Doc. E8-21563 Filed 9-15-08; 8:45 am]

BILLING CODE 4910-EX-P


[Federal Register Volume 76, Number 37 (Thursday, February 24, 2011)]
[Notices]
[Page 10360]
[FR Doc No: 2011-4087]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 13850-000]

Qualified Hydro 25, LLC; Notice of Preliminary Permit Application
Accepted for Filing and Soliciting Comments, Motions to Intervene, and
Competing Applications

    On September 30, 2010, Qualified Hydro 25, LLC filed an application
for a preliminary permit, pursuant to section 4(f) of the Federal Power
Act (FPA), proposing to study the feasibility of the Easton Diversion
Dam Hydroelectric Project (Easton Dam project) to be located on the
Yakima River near Easton in Kittitas County, Washington. The sole
purpose of a preliminary permit, if issued, is to grant the permit
holder priority to file a license application during the permit term. A
preliminary permit does not authorize the permit holder to perform any
land-disturbing activities or otherwise enter upon lands or waters
owned by others without the owners' express permission.
    The proposed project would consist of the following: (1) An
existing 66-foot-high, 248-foot-long concrete gravity dam on the Yakima
River which is owned and operated by the U.S. Bureau of Reclamation;
(2) an existing gated outlet with a 1,320 cubic feet per second
capacity; (3) a new 20-foot-wide concrete intake structure with trash
racks and intake gates; (4) a new 325-foot-long, 72-inch-diameter steel
penstock from the intake structure to the powerhouse; (5) a 50-foot by
40-foot reinforced concrete powerhouse containing one Kaplan turbine
with a capacity of 1.2 megawatts; (6) a new substation; (7) a new
approximately 1,400-foot-long, 34.5-69 kilovolt transmission line which
will tie into an undetermined interconnection; and (8) appurtenant
facilities. The estimated annual generation of the Easton Dam project
would be 5.0 gigawatt-hours.
    Applicant Contact: Ramya Swaminthan, Qualified Hydro 25, LLC, 33
Commercial St., Gloucester, MA 01930; phone:<PHONE_NUMBER>.
    FERC Contact: Ryan Hansen<PHONE_NUMBER> or by e-mail at
<EMAIL_ADDRESS>    Deadline for filing comments, motions to intervene, competing
applications (without notices of intent), or notices of intent to file
competing applications: 60 days from the issuance of this notice.
Competing applications and notices of intent must meet the requirements
of 18 CFR 4.36. Comments, motions to intervene, notices of intent, and
competing applications may be filed electronically via the Internet.
See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's
Web site http://www.ferc.gov/docs-filing/efiling.asp. Commenters can
submit brief comments up to 6,000 characters, without prior
registration, using the eComment system at http://www.ferc.gov/docs-filing/ecomment.asp. You must include your name and contact information
at the end of your comments. For assistance, please contact FERC Online
Support. Although the Commission strongly encourages electronic filing,
documents may also be paper-filed. To paper-file, mail an original and
seven copies to: Kimberly D. Bose, Secretary, Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426.
    More information about this project, including a copy of the
application, can be viewed or printed on the ``eLibrary'' link of
Commission's Web site at http://www.ferc.gov/docs-filing/elibrary.asp.
Enter the docket number (P-13850-000) in the docket number field to
access the document. For assistance, contact FERC Online Support.

    Dated: February 16, 2011.
Kimberly D. Bose,
Secretary.
[FR Doc. 2011-4087 Filed 2-23-11; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 87, Number 105 (Wednesday, June 1, 2022)]
[Rules and Regulations]
[Pages 32987-32988]
[FR Doc No: 2022-11614]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 744

Control Policy: End-User and End-Use Based

CFR Correction

    This rule is being published by the Office of the Federal Register
to correct an editorial or technical error that appeared in the most
recent annual revision of the Code of Federal Regulations.

0
In Title 15 of the Code of Federal Regulations, Parts 300 to 799,
revised as of January 1, 2022, in supplement no. 4 to part 744, in the
table under ``RUSSIA'', revise the entry for ``Kaliningradnefteprodukt
OOO'' to read as follows:

                                    Supplement No. 4 to Part 744--Entity List
----------------------------------------------------------------------------------------------------------------
                                                             License         License  review    Federal Register
        Country                     Entity                 requirement           policy             citation
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
RUSSIA.................                                         * * * * * *

                         Kaliningradnefteprodukt OOO,  For all items       Presumption of      83 FR 6952, 2/16/
                          a.k.a., the following three   subject to the      denial.             18. 83 FR 12479,
                          aliases:                      EAR when used in                        3/22/18.
                         --Kaliningradnefteprodukt      projects
                          LLC;                          specified in Sec.
                         --Limited Liability Company      746.5 of the
                          Kaliningradnefteproduct;      EAR.
                          and
                         --LLC
                          Kaliningradnefteproduct
                         22-b Komsomolskaya Ulitsa,
                          Central District,
                          Kaliningrad, Russia.
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

[FR Doc. 2022-11614 Filed 5-31-22; 8:45 am]
BILLING CODE 099-10-P


[Federal Register Volume 77, Number 247 (Wednesday, December 26, 2012)]
[Notices]
[Pages 76148-76155]
[FR Doc No: 2012-30888]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68458; File No. SR-NYSEArca-2012-139]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change To List and Trade First Trust Preferred
Securities and Income ETF Under NYSE Arca Equities Rule 8.600

December 18, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'' or ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that, on December 6, 2012, NYSE Arca, Inc.
(``Exchange'' or ``NYSE Arca'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by the
Exchange. The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to list and trade the following under NYSE
Arca Equities Rule 8.600 (``Managed Fund Shares''): First Trust
Preferred Securities and Income ETF. The text of the proposed rule
change is available on the Exchange's Web site at www.nyse.com, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.

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

    In its filing with the Commission, the self-regulatory organization
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 those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries,

set forth in sections A, B, and C below, of the most significant parts
of such statements.

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

1. Purpose
    The Exchange proposes to list and trade shares (``Shares'') of the
First Trust Preferred Securities and Income ETF (``Fund'') under NYSE
Arca Equities Rule 8.600,\3\ which governs the listing and trading of
Managed Fund Shares.\4\ The Shares will be offered by First Trust
Exchange-Traded Fund III (``Trust''), which is organized as a
Massachusetts business trust and is registered with the Commission as
an open-end management investment company.\5\ The investment adviser to
the Fund is First Trust Advisors L.P. (``Adviser'' or ``First Trust'').
Stonebridge Advisors LLC will serve as investment sub-adviser to the
Fund (``Sub-Adviser'') and will provide day-to-day portfolio management
of the Fund. First Trust Portfolios L.P. (``Distributor'') will be the
principal underwriter and distributor of the Fund's Shares. Brown
Brothers Harriman & Co. (``Administrator'' or ``Custodian'') will serve
as administrator, custodian, and transfer agent for the Fund.
---------------------------------------------------------------------------

    \3\ The Commission previously approved listing and trading on
the Exchange of a number of actively managed funds under Rule 8.600.
See, e.g., Securities Exchange Act Release Nos. 57801 (May 8, 2008),
73 FR 27878 (May 14, 2008) (SR-NYSEArca-2008-31) (order approving
Exchange listing and trading of twelve actively-managed funds of the
WisdomTree Trust); 60460 (August 7, 2009), 74 FR 41468 (August 17,
2009) (SR-NYSEArca-2009-55) (order approving listing of Dent
Tactical ETF); 62502 (July 15, 2010), 75 FR 42471 (July 21, 2010)
(SR-NYSEArca-2010-57) (order approving listing of AdviserShares WCM/
BNY Mellon Focused Growth ADR ETF); and 63076 (October 12, 2010), 75
FR 63874 (October 18, 2010) (SR-NYSEArca-2010-79) (order approving
listing of Cambria Global Tactical ETF).
    \4\ A Managed Fund Share is a security that represents an
interest in an investment company registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an
open-end investment company or similar entity that invests in a
portfolio of securities selected by its investment adviser
consistent with its investment objectives and policies. In contrast,
an open-end investment company that issues Investment Company Units,
listed and traded on the Exchange under NYSE Arca Equities Rule
5.2(j)(3), seeks to provide investment results that correspond
generally to the price and yield performance of a specific foreign
or domestic stock index, fixed income securities index, or
combination thereof.
    \5\ The Trust is registered under the 1940 Act. On September 23,
2011, the Trust filed with the Commission a registration statement
on Form N-1A under the Securities Act of 1933 and under the 1940 Act
relating to the Fund (File Nos. 333-176976 and 811-22245)
(``Registration Statement''). The description of the operation of
the Trust and the Fund herein is based, in part, on the Registration
Statement. In addition, the Commission has issued an order granting
certain exemptive relief to the Trust under the 1940 Act. See
Investment Company Act Release No. 30029 (April 10, 2012) (File No.
812-13795) (``Exemptive Order'').
---------------------------------------------------------------------------

    Commentary .06 to Rule 8.600 provides that, if the investment
adviser to the investment company issuing Managed Fund Shares is
affiliated with a broker-dealer, such investment adviser shall erect a
``fire wall'' between the investment adviser and the broker-dealer with
respect to access to information concerning the composition and/or
changes to such investment company portfolio. In addition, Commentary
.06 further requires that personnel who make decisions on the open-end
fund's portfolio composition must be subject to procedures designed to
prevent the use and dissemination of material nonpublic information
regarding the open-end fund's portfolio.\6\ Commentary .06 to Rule
8.600 is similar to Commentary .03(a)(i) and (iii) to NYSE Arca
Equities Rule 5.2(j)(3); however, Commentary .06 in connection with the
establishment of a ``fire wall'' between the investment adviser and the
broker-dealer reflects the applicable open-end fund's portfolio, not an
underlying benchmark index, as is the case with index-based funds. The
Adviser is affiliated with the Distributor, a broker-dealer, and the
Sub-Adviser also is affiliated with a broker-dealer. The Adviser and
Sub-Adviser each has implemented a fire wall with respect to its
respective broker-dealer affiliate regarding access to information
concerning the composition and/or changes to the portfolio. In the
event (a) the Adviser or the Sub-Adviser becomes newly affiliated with
a broker-dealer, or (b) any new adviser or sub-adviser becomes
affiliated with a broker-dealer, it will implement a fire wall with
respect to such broker-dealer regarding access to information
concerning the composition and/or changes to the portfolio, and will be
subject to procedures designed to prevent the use and dissemination of
material, non-public information regarding such portfolio.
---------------------------------------------------------------------------

    \6\ An investment adviser to an open-end fund is required to be
registered under the Investment Advisers Act of 1940 (``Advisers
Act''). As a result, the Adviser and Sub-Adviser and their related
personnel are subject to the provisions of Rule 204A-1 under the
Advisers Act relating to codes of ethics. This Rule requires
investment advisers to adopt a code of ethics that reflects the
fiduciary nature of the relationship to clients as well as
compliance with other applicable securities laws. Accordingly,
procedures designed to prevent the communication and misuse of non-
public information by an investment adviser must be consistent with
Rule 204A-1 under the Advisers Act. In addition, Rule 206(4)-7 under
the Advisers Act makes it unlawful for an investment adviser to
provide investment advice to clients unless such investment adviser
has (i) adopted and implemented written policies and procedures
reasonably designed to prevent violation, by the investment adviser
and its supervised persons, of the Advisers Act and the Commission
rules adopted thereunder; (ii) implemented, at a minimum, an annual
review regarding the adequacy of the policies and procedures
established pursuant to subparagraph (i) above and the effectiveness
of their implementation; and (iii) designated an individual (who is
a supervised person) responsible for administering the policies and
procedures adopted under subparagraph (i) above.
---------------------------------------------------------------------------

    According to the Registration Statement, the Fund's objective will
be to provide current income and total return. Under normal market
conditions,\7\ the Fund will invest at least 80% of its net assets
(including investment borrowings) in preferred securities (``Preferred
Securities'') and income-producing debt securities (``Income
Securities'').\8\ The Adviser represents that initially at least 50% of
the Fund's net assets invested in Preferred Securities and 50% of the
Income Securities held by the Fund will be exchange-listed.\9\ However,
the Fund reserves the right to reduce the percentage of assets that are
exchange-listed. Preferred Securities held by the Fund generally pay
fixed or adjustable-rate distributions to investors and have preference
over common stock in the payment of distributions and the

liquidation of a company's assets, but are generally junior to all
forms of the company's debt, including both senior and subordinated
debt. For purposes of the 80% test set forth above, Income Securities
consist of both foreign and domestic debt instruments, including
corporate bonds, high yield bonds, convertible securities, and
contingent convertible capital securities. In addition, for purposes of
the 80% test set forth above, securities of other open-end funds,
closed-end funds, or exchange-traded funds (``ETFs'') registered under
the 1940 Act \10\ that invest primarily in Preferred Securities or
Income Securities will be deemed to be Preferred Securities or Income
Securities, respectively. The Adviser represents that at least 80% of
the Preferred Securities and Income Securities held by the Fund will
have a minimum original principal amount outstanding of $100 million or
more. In addition, the Fund's portfolio will be comprised of a minimum
of 13 non-affiliated issuers.
---------------------------------------------------------------------------

    \7\ The term ``under normal market conditions'' includes, but is
not limited to, the absence of extreme volatility or trading halts
in the equity markets or the financial markets generally;
operational issues causing dissemination of inaccurate market
information; or force majeure type events such as systems failure,
natural or man-made disaster, act of God, armed conflict, act of
terrorism, riot or labor disruption, or any similar intervening
circumstance.
    \8\ The risks and potential rewards of investing in the Fund may
at times be similar to the risks and potential rewards of investing
in both equity funds and bond funds. Certain of the Preferred
Securities in which the Fund will invest will be traditional
preferred stocks which issue dividends that qualify for the dividend
received deduction under which ``qualified'' domestic corporations
are able to exclude a percentage of the dividends received from
their taxable income. Certain of the Preferred Securities in which
the Fund will invest will be preferred stock that does not issue
dividends that qualify for the dividends received deduction for
eligible investors (``non-DRD preferred stock'') that do not qualify
for the dividends received deduction or issue qualified dividend
income. As described in the Registration Statement, hybrid preferred
securities, another type of Preferred Securities, are typically
junior and fully subordinated liabilities of an issuer or the
beneficiary of a guarantee that is junior and fully subordinated to
the other liabilities of the guarantor.
    \9\ The foreign equity securities, including preferred, hybrid-
preferred, and contingent convertible capital, securities in which
the Fund may invest will be limited to securities that trade in
markets that are members of the Intermarket Surveillance Group
(``ISG''), which includes all U.S. national securities exchanges and
certain foreign exchanges, or are parties to a comprehensive
surveillance sharing agreement with the Exchange. See note 25,
infra.
    \10\ For purposes of this filing, ETFs, which will be listed on
a national securities exchange, include the following: Investment
Company Units (as described in NYSE Arca Equities Rule 5.2(j)(3));
Portfolio Depositary Receipts (as described in NYSE Arca Equities
Rule 8.100); and Managed Fund Shares (as described in NYSE Arca
Equities Rule 8.600). The Fund may invest in the securities of ETFs
in excess of the limits imposed under the 1940 Act pursuant to
exemptive orders obtained by certain ETFs and their sponsors from
the Commission. The Fund will not invest in leveraged, inverse, or
leveraged inverse ETFs.
---------------------------------------------------------------------------

    As stated above, the Fund may invest in a variety of debt
securities, including corporate debt securities.\11\ The broad category
of corporate debt securities includes debt issued by U.S. and non-U.S.
companies of all kinds, including those with small-, mid-, and large-
capitalizations.\12\ Corporate debt may carry fixed or floating rates
of interest.
---------------------------------------------------------------------------

    \11\ As described in the Registration Statement, corporate debt
securities are fixed-income securities issued by businesses to
finance their operations. Notes, bonds, debentures, and commercial
paper are the most common types of corporate debt securities, with
the primary difference being their maturities and secured or
unsecured status. Certain debt securities held by the Fund may
include debt instruments that are similar in many respects to
preferred securities.
    \12\ Under normal market conditions, at least 80% of the Fund's
investments in U.S. corporate bonds must have $100 million or more
par amount outstanding to be considered as an eligible investment
and a non-U.S. corporate bond must have $200 million or more par
amount outstanding and significant par value traded to be considered
as an eligible investment. Economic and other conditions may, from
time to time, lead to a decrease in the average par amount
outstanding of bond issuances.
---------------------------------------------------------------------------

    Initially, the Fund will invest at least 80% of the Fund's net
assets in Income Securities of an issuing firm when the issuing firm
(``issuer'') has a long-term issuer credit rating of investment grade
at the time of the investment. However, the Fund reserves the right to
reduce the percentage of assets invested in investment grade issuers.
``Investment grade'' is defined as those issuers that have a long-term
credit rating of ``BBB-'' or higher by Standard & Poor's Rating Group,
a division of McGraw Hill Companies, Inc. (``S&P''), or ``Baa3'' or
higher by Moody's Investors Service, Inc. (``Moody's''), or comparably
rated by another nationally recognized statistical rating organization
(``NRSRO''). The Fund may also invest in securities that are unrated by
an NRSRO if such securities are of comparable credit quality.
Comparable credit quality of securities that are unrated by an NRSRO
will be determined by the Sub-Adviser based on fundamental credit
analysis of the unrated issuer and comparable NRSRO rated peer issuers
of the same industry sector. On a best efforts basis, the Sub-Adviser
will attempt to make a rating determination based on publicly available
data. Factors taken into consideration in determining the comparable
credit quality of the unrated issuer will be company leverage, capital
structure, liquidity, funding, sustainability of cash flows, earnings
quality, market position, and asset quality. In the event that a
security is rated by multiple NRSROs and receives divergent ratings,
the Fund will treat the issuing firm as being rated in the highest
rating category received from an NRSRO.
    Initially, the Fund may invest up to 20% of the Fund's net assets
in Income Securities issued by below-investment grade issuers if that
security has acceptable credit quality and attractive relative value.
However, the Fund reserves the right to increase the percentage of
assets invested in below-investment grade securities. ``Below
investment grade'' is defined as those issuers that have a long-term
credit rating of ``BBB-'' or lower by ``S&P,'' or ``Baa3'' or lower by
Moody's, or comparably rated by another NRSRO. The Fund may also invest
in securities that are unrated by an NRSRO if such securities are of
comparable credit quality as determined by the Sub-Adviser.
    The Fund intends to invest at least 25% of its assets in securities
of financial companies. Financial companies include, but are not
limited to, companies involved in activities such as banking, mortgage
finance, consumer finance, specialized finance, investment banking and
brokerage, asset management and custody, corporate lending, insurance
and financial investment, and real estate, including but not limited to
real estate investment trusts (``REITs'').
Other Investments
    While the Fund, under normal market conditions, will invest at
least 80% of its net assets (including investment borrowings) in
Preferred Securities and Income Securities, the Fund also may invest
the remainder of its assets in other investments, as described below.
    Normally, the Fund may invest up to 15% of its net assets in
securities with maturities of less than one year or cash equivalents,
or it may hold cash. The percentage of the Fund invested in such
holdings will vary and depend on several factors, including market
conditions. For temporary defensive purposes and during periods of high
cash inflows or outflows, the Fund may depart from its principal
investment strategies and invest part or all of its assets in these
securities or it may hold cash. During such periods, the Fund may not
be able to achieve its investment objective. The Fund may adopt a
defensive strategy when the Sub-Adviser or the Adviser believes
securities in which the Fund normally invests have elevated risks due
to political or economic factors and in other extraordinary
circumstances.
    The Fund may also invest in U.S. government securities \13\ or
short-term debt securities \14\ to keep cash on hand

fully invested or for temporary defensive purposes. Short-term debt
securities are securities from issuers having a long-term debt rating
of at least A by S&P Ratings, Moody's, or Fitch, Inc. and having a
maturity of one year or less. The use of temporary investments is not a
part of the principal investment strategy of the Fund.
---------------------------------------------------------------------------

    \13\ U.S. government securities include U.S. Treasury
obligations and securities issued or guaranteed by various agencies
of the U.S. government, or by various instrumentalities which have
been established or sponsored by the U.S. government. U.S. Treasury
obligations are backed by the ``full faith and credit'' of the U.S.
government. Securities issued or guaranteed by federal agencies and
U.S. government sponsored instrumentalities may or may not be backed
by the full faith and credit of the U.S. government.
    \14\ Short-term debt securities are defined to include, without
limitation, the following:
    (1) U.S. Government securities, including bills, notes, and
bonds differing as to maturity and rates of interest, which are
either issued or guaranteed by the U.S. Treasury or by U.S.
Government agencies or instrumentalities.
    (2) Certificates of deposit issued against funds deposited in a
bank or savings and loan association. Such certificates are for a
definite period of time, earn a specified rate of return, and are
normally negotiable. If such certificates of deposit are non-
negotiable, they will be considered illiquid securities and be
subject to the Fund's 15% restriction on investments in illiquid
securities.
    (3) Bankers' acceptances, which are short-term credit
instruments used to finance commercial transactions.
    (4) Repurchase agreements, which involve purchases of debt
securities. In such an action, at the time the Fund purchases the
security, it simultaneously agrees to resell and redeliver the
security to the seller, who also simultaneously agrees to buy back
the security at a fixed price and time.
    (5) Bank time deposits, which are monies kept on deposit with
banks or savings and loan associations for a stated period of time
at a fixed rate of interest.
    (6) Commercial paper, which are short-term unsecured promissory
notes, including variable rate master demand notes issued by
corporations to finance their current operations. Master demand
notes are direct lending arrangements between the Fund and a
corporation. There is no secondary market for the notes, and they
will be considered illiquid securities and be subject to the Fund's
15% restriction on investments in illiquid securities. However, they
are redeemable by the Fund at any time. The Fund's Sub-Adviser will
consider the financial condition of the corporation (e.g., earning
power, cash flow, and other liquidity ratios) and will continuously
monitor the corporation's ability to meet all of its financial
obligations, because the Fund's liquidity might be impaired if the
corporation were unable to pay principal and interest on demand. The
Fund may only invest in commercial paper rated A-2 or higher by S&P
Ratings, Prime-2 or higher by Moody's, or F2 or higher by Fitch,
Inc.
---------------------------------------------------------------------------

    The Fund may also invest in senior loans, second lien loans, loan
participations, payment-in-kind securities, zero coupon bonds, bank
certificates of deposit, fixed-time deposits, bankers' acceptances,
U.S. government securities, or fixed income securities issued by non-
U.S. governments denominated in U.S. dollars.
    The Fund may invest in warrants. Warrants acquired by the Fund
entitle it to buy common stock from the issuer at a specified price and
time. They do not represent ownership of the securities but only the
right to buy them. Warrants are subject to the same market risks as
stocks, but may be more volatile in price. The Fund's investment in
warrants will not entitle it to receive dividends or exercise voting
rights and will become worthless if the warrants cannot be profitably
exercised before their expiration date.
    The Fund may invest in other pooled investment vehicles and
business development companies that are exchange listed and that invest
primarily in securities of the types in which the Fund may invest
directly.
    Consistent with the Exemptive Order, the Fund will not invest in
options contracts, futures contracts, or swap agreements.
    The Fund will not take short positions in securities (``short
sales'').
    The Fund may hold up to an aggregate amount of 15% of its net
assets in illiquid securities (calculated at the time of investment),
including (1) non-negotiable certificates of deposit and master demand
notes,\15\ (2) Rule 144A securities, and (3) senior loans, second lien
loans, and loan participation interests. The Fund will monitor its
portfolio liquidity on an ongoing basis to determine whether, in light
of current circumstances, an adequate level of liquidity is being
maintained, and will consider taking appropriate steps in order to
maintain adequate liquidity if, through a change in values, net assets,
or other circumstances, more than 15% of the Fund's net assets are held
in illiquid securities. Illiquid securities include securities subject
to contractual or other restrictions on resale and other instruments
that lack readily available markets as determined in accordance with
Commission staff guidance.\16\
---------------------------------------------------------------------------

    \15\ See note 14, supra.
    \16\ The Commission has stated that long-standing Commission
guidelines have required open-end funds to hold no more than 15% of
their net assets in illiquid securities and other illiquid assets.
See Investment Company Act Release No. 28193 (March 11, 2008), 73 FR
14618 (March 18, 2008), footnote 34. See also Investment Company Act
Release No. 5847 (October 21, 1969), 35 FR 19989 (December 31, 1970)
(Statement Regarding ``Restricted Securities''); Investment Company
Act Release No. 18612 (March 12, 1992), 57 FR 9828 (March 20, 1992)
(Revisions of Guidelines to Form N-1A). A fund's portfolio security
is illiquid if it cannot be disposed of in the ordinary course of
business within seven days at approximately the value ascribed to it
by the fund. See Investment Company Act Release No. 14983 (March 12,
1986), 51 FR 9773 (March 21, 1986) (adopting amendments to Rule 2a-7
under the 1940 Act); and Investment Company Act Release No. 17452
(April 23, 1990), 55 FR 17933 (April 30, 1990) (adopting Rule 144A
under the Securities Act of 1933).
---------------------------------------------------------------------------

    The Fund will be classified as ``non-diversified'' under the 1940
Act and as a result may invest a relatively high percentage of its
assets in a limited number of issuers. The Fund will only be limited as
to the percentage of its assets which may be invested in the securities
of any one issuer by the diversification requirements imposed by the
Internal Revenue Code of 1986, as amended (``Code'').\17\
---------------------------------------------------------------------------

    \17\ See 26 U.S.C. 851.
---------------------------------------------------------------------------

    Other than financial companies, the Fund may not invest 25% or more
of the value of its total assets in securities of issuers in any one
industry or group of industries. This restriction does not apply to
obligations issued or guaranteed by the U.S. Government, its agencies,
or instrumentalities.\18\
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    \18\ See Form N-1A, Item 9. The Commission has taken the
position that a fund is concentrated if it invests more than 25% of
the value of its total assets in any one industry. See, e.g.,
Investment Company Act Release No. 9011 (October 30, 1975), 40 FR
54241 (November 21, 1975).
---------------------------------------------------------------------------

    The Fund intends to qualify annually and to elect to be treated as
a regulated investment company (``RIC'') under the Code.\19\
---------------------------------------------------------------------------

    \19\ 26 U.S.C. 851.
---------------------------------------------------------------------------

    The Fund's investments will be consistent with the Fund's
investment objective and will not be used to enhance leverage.
    The Shares will conform to the initial and continued listing
criteria under NYSE Arca Equities Rule 8.600. The Exchange represents
that, for initial and/or continued listing, the Fund will be in
compliance with Rule 10A-3 under the Exchange Act,\20\ as provided by
NYSE Arca Equities Rule 5.3. A minimum of 100,000 Shares will be
outstanding at the commencement of trading on the Exchange. The
Exchange will obtain a representation from the issuer of the Shares
that the net asset value (``NAV'') per Share will be calculated daily
and that the NAV and the Disclosed Portfolio will be made available to
all market participants at the same time.
---------------------------------------------------------------------------

    \20\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Creation and Redemption of Shares
    The Fund will issue and redeem Shares on a continuous basis, at
NAV, only in large specified blocks each consisting of 50,000 Shares
(each such block of Shares, a ``Creation Unit''). The consideration for
purchase of Creation Unit aggregations of the Fund may consist of (i)
cash in lieu of all or a portion of the Deposit Securities, as defined
below, and/or (ii) a designated portfolio of securities determined by
First Trust (``Deposit Securities'') per Creation Unit aggregation
generally conforming to holdings of the Fund (``Fund Securities'') and
generally an amount of cash (``Cash Component''). Together, the Deposit
Securities and the Cash Component (including the cash in lieu amount)
constitute the ``Fund Deposit,'' which represents the minimum initial
and subsequent investment amount for a Creation Unit aggregation of the
Fund.
    The Custodian, through the National Securities Clearing Corporation
(``NSCC''), will make available on each business day, prior to the
opening of business of the New York Stock Exchange (``NYSE'')
(currently 9:30 a.m., Eastern Time (``E.T.'')), the list of the names
and the required number of shares of each Deposit Security to be
included in the current Fund Deposit (based on information at the end
of the previous business day) for the Fund.
    Such Fund Deposit will be applicable, subject to any adjustments as
described below, in order to effect creations of Creation Unit
aggregations of the Fund until such time as the next-announced

composition of the Deposit Securities is made available.
    In order to be eligible to place orders with the Distributor and to
create or redeem a Creation Unit aggregation of the Fund, an entity
must be an authorized participant, and must have executed an agreement
with the Distributor and transfer agent, with respect to creations and
redemptions of Creation Unit aggregations, and have international
operational capabilities.
    Fund Shares may be redeemed only in Creation Unit aggregations at
their NAV next determined after receipt of a redemption request in
proper form by the Fund through the transfer agent and only on a
business day. The Fund will not redeem Shares in amounts less than
Creation Unit aggregations.
    The Custodian, through the NSCC, will make available prior to the
opening of business on the NYSE (currently 9:30 a.m., E.T.) on each
business day, the identity of the Fund Securities that will be
applicable (subject to possible amendment or correction) to redemption
requests received in proper form on that day. Fund Securities received
on redemption may not be identical to Deposit Securities that are
applicable to creations of Creation Unit aggregations.
    All orders to create or redeem Creation Unit aggregations must be
received by the transfer agent no later than the closing time of the
regular trading session on the NYSE (ordinarily 4:00 p.m., E.T.), in
each case on the date such order is placed in order for creation or
redemption of Creation Unit aggregations to be effected based on the
NAV of Shares of the Fund as next determined on such date after receipt
of the order in proper form.
    The Fund's NAV will be determined as of the close of trading
(normally 4:00 p.m., E.T.) on each day the NYSE is open for business.
NAV will be calculated for the Fund by taking the market price of the
Fund's total assets, including interest or dividends accrued but not
yet collected, less all liabilities, and dividing such amount by the
total number of Shares outstanding. The result, rounded to the nearest
cent, will be the NAV per Share.
    The Fund's investments will be valued at market value or, in the
absence of market value with respect to any portfolio securities, at
fair value in accordance with valuation procedures adopted by the
Trust's Board of Trustees and in accordance with the 1940 Act.
Availability of Information
    The Fund's Web site (www.ftportfolios.com), which will be publicly
available prior to the public offering of Shares, will include a form
of the prospectus for the Fund that may be downloaded. The Fund's Web
site will include additional quantitative information updated on a
daily basis, including, for the Fund, (1) daily trading volume, the
prior business day's reported closing price, NAV and mid-point of the
bid/ask spread at the time of calculation of such NAV (the ``Bid/Ask
Price''),\21\ and a calculation of the premium and discount of the Bid/
Ask Price against the NAV, and (2) data in chart format displaying the
frequency distribution of discounts and premiums of the daily Bid/Ask
Price against the NAV, within appropriate ranges, for each of the four
previous calendar quarters. On each business day, before commencement
of trading in Shares in the Core Trading Session on the Exchange, the
Fund will disclose on its Web site the Disclosed Portfolio as defined
in NYSE Arca Equities Rule 8.600(c)(2) that will form the basis for the
Fund's calculation of NAV at the end of the business day.\22\
---------------------------------------------------------------------------

    \21\ The Bid/Ask Price of the Fund will be determined using the
mid-point of the highest bid and the lowest offer on the Exchange as
of the time of calculation of the Fund's NAV. The records relating
to Bid/Ask Prices will be retained by the Fund and its service
providers.
    \22\ Under accounting procedures followed by the Fund, trades
made on the prior business day (``T'') will be booked and reflected
in NAV on the current business day (``T+1''). Accordingly, the Fund
will be able to disclose at the beginning of the business day the
portfolio that will form the basis for the NAV calculation at the
end of the business day.
---------------------------------------------------------------------------

    On a daily basis, the Adviser will disclose for each portfolio
security and other financial instrument of the Fund the following
information on the Fund's Web site: Ticker symbol (if applicable), name
of security and financial instrument, number of shares or dollar value
of securities and financial instruments held in the portfolio, and
percentage weighting of the security and financial instrument in the
portfolio. The Web site information will be publicly available at no
charge.
    In addition, a basket composition file, which includes the security
names and share quantities required to be delivered in exchange for the
Fund's Shares, together with estimates and actual cash components, will
be publicly disseminated daily prior to the opening of the NYSE via the
NSCC. The basket represents one Creation Unit of the Fund.
    Information regarding the intra-day value of the Shares of the Fund
(the ``indicative optimized portfolio value'' or ``IOPV''), which is
the Portfolio Indicative Value (``PIV'') as defined in NYSE Arca
Equities Rule 8.600 (c)(3), will be widely disseminated by one or more
major market data vendors at least every 15 seconds during the Core
Trading Session.\23\ The dissemination of the IOPV, together with the
Disclosed Portfolio, will allow investors to determine the value of the
underlying portfolio of the Fund on a daily basis and to provide a
close estimate of that value throughout the trading day. The IOPV
should not be viewed as a ``real-time'' update of the NAV per Share of
the Fund because the IOPV may not be calculated in the same manner as
the NAV, which is computed once a day, generally at the end of the
business day. The price of a non-U.S. security that is primarily traded
on a non-U.S. exchange shall be updated, using the last sale price,
every 15 seconds throughout the trading day, provided, that upon the
closing of such non-U.S. exchange, the closing price of the security,
after being converted to U.S. dollars, will be used. Furthermore, in
calculating the IOPV of the Fund's Shares, exchange rates may be used
throughout the day (9:00 a.m. to 4:15 p.m., E.T.) that may differ from
those used to calculate the NAV per Share of the Fund and consequently
may result in differences between the NAV and the IOPV.
---------------------------------------------------------------------------

    \23\ Currently, it is the Exchange's understanding that several
major market data vendors display and/or make widely available IOPVs
taken from the Consolidated Tape Association (``CTA'') or other data
feeds.
---------------------------------------------------------------------------

    The Adviser represents that the Trust, First Trust, and BNY will
not disseminate non-public information concerning the Trust and the
Fund.
    Investors can also obtain the Trust's Statement of Additional
Information (``SAI''), the Fund's Shareholder Reports, and the Trust's
Form N-CSR and Form N-SAR, filed twice a year. The Trust's SAI and
Shareholder Reports are available free upon request from the Trust, and
those documents and the Form N-CSR and Form N-SAR may be viewed on-
screen or downloaded from the Commission's Web site at www.sec.gov.
Information regarding market price and trading volume of the Shares
will be continually available on a real-time basis throughout the day
on brokers' computer screens and other electronic services. Information
regarding the previous day's closing price and trading volume
information for the Shares will be published daily in the financial
section of newspapers. Quotation and last-sale information for the
Shares will be available via the CTA high-speed line. The intra-day,
closing, and settlement prices of the portfolio securities and other
instruments will be also readily available from the national securities
exchanges trading such securities,

automated quotation systems, published or other public sources, or on-
line information services such as Bloomberg or Reuters.
    Additional information regarding the Trust and the Shares,
including investment strategies, risks, creation and redemption
procedures, fees, portfolio holdings disclosure policies,
distributions, and taxes is included in the Registration Statement. All
terms relating to the Fund that are referred to, but not defined in,
this proposed rule change are defined in the Registration Statement.
Trading Halts
    With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of the Fund.\24\ Trading in Shares of the Fund
will be halted if the circuit breaker parameters in NYSE Arca Equities
Rule 7.12 have been reached. Trading also may be halted because of
market conditions or for reasons that, in the view of the Exchange,
make trading in the Shares inadvisable. These may include: (1) The
extent to which trading is not occurring in the securities and/or the
financial instruments comprising the Disclosed Portfolio of the Fund;
or (2) whether other unusual conditions or circumstances detrimental to
the maintenance of a fair and orderly market are present. Trading in
the Shares will be subject to NYSE Arca Equities Rule 8.600(d)(2)(D),
which sets forth circumstances under which Shares of the Fund may be
halted.
---------------------------------------------------------------------------

    \24\ See NYSE Arca Equities Rule 7.12, Commentary .04.
---------------------------------------------------------------------------

Trading Rules
    The Exchange deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities. Shares will trade on
the NYSE Arca Marketplace from 4:00 a.m. to 8:00 p.m., E.T. in
accordance with NYSE Arca Equities Rule 7.34 (Opening, Core, and Late
Trading Sessions). The Exchange has appropriate rules to facilitate
transactions in the Shares during all trading sessions. As provided in
NYSE Arca Equities Rule 7.6, Commentary .03, the minimum price
variation (``MPV'') for quoting and entry of orders in equity
securities traded on the NYSE Arca Marketplace is $0.01, with the
exception of securities that are priced less than $1.00 for which the
MPV for order entry is $0.0001.
Surveillance
    The Exchange intends to utilize its existing surveillance
procedures applicable to derivative products (which include Managed
Fund Shares) to monitor trading in the Shares. The Exchange represents
that these procedures are adequate to properly monitor Exchange trading
of the Shares in all trading sessions and to deter and detect
violations of Exchange rules and applicable federal securities laws.
    The Exchange's current trading surveillance focuses on detecting
securities trading outside their normal patterns. When such situations
are detected, surveillance analysis follows and investigations are
opened, where appropriate, to review the behavior of all relevant
parties for all relevant trading violations.
    The Exchange may obtain information via the ISG from other
exchanges that are members of ISG or with which the Exchange has in
place a comprehensive surveillance sharing agreement.\25\ Initially, at
least 50% of the Fund's net assets invested in Preferred Securities and
Income Securities will be exchange-listed and such exchanges will be
members of ISG or parties to a comprehensive surveillance sharing
agreement with the Exchange.
---------------------------------------------------------------------------

    \25\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of the
Disclosed Portfolio for the Fund may trade on markets that are
members of ISG or with which the Exchange has in place a
comprehensive surveillance sharing agreement. See note 9, supra.
---------------------------------------------------------------------------

    In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its
Equity Trading Permit (``ETP'') Holders in an Information Bulletin
(``Bulletin'') of the special characteristics and risks associated with
trading the Shares. Specifically, the Bulletin will discuss the
following: (1) The procedures for purchases and redemptions of Shares
in Creation Unit aggregations (and that Shares are not individually
redeemable); (2) NYSE Arca Equities Rule 9.2(a), which imposes a duty
of due diligence on its ETP Holders to learn the essential facts
relating to every customer prior to trading the Shares; (3) the risks
involved in trading the Shares during the Opening and Late Trading
Sessions when an updated PIV will not be calculated or publicly
disseminated; (4) how information regarding the PIV is disseminated;
(5) the requirement that ETP Holders deliver a prospectus to investors
purchasing newly issued Shares prior to or concurrently with the
confirmation of a transaction; and (6) trading information.
    In addition, the Bulletin will reference that the Fund is subject
to various fees and expenses described in the Registration Statement.
The Bulletin will discuss any exemptive, no-action, and interpretive
relief granted by the Commission from any rules under the Exchange Act.
The Bulletin will also disclose that the NAV for the Shares will be
calculated after 4:00 p.m., E.T. each trading day.
2. Statutory Basis
    The basis under the Exchange Act for this proposed rule change is
the requirement under Section 6(b)(5) \26\ that an exchange have rules
that are 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.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Equities Rule
8.600. The Exchange has in place surveillance procedures that are
adequate to properly monitor trading in the Shares in all trading
sessions and to deter and detect violations of Exchange rules and
applicable federal securities laws. The Exchange may obtain information
via ISG from other exchanges that are members of ISG or with which the
Exchange has entered into a comprehensive surveillance sharing
agreement. Under normal market conditions, the Fund will invest at
least 80% of its net assets (including investment borrowings) in
Preferred Securities and Income Securities. The Adviser represents that
initially at least 50% of the Fund's net assets invested in Preferred
Securities and 50% of the Income Securities held by the Fund will be
exchange-listed. The foreign equity securities, including preferred,
hybrid-preferred, and contingent convertible capital, securities in
which the Fund may invest will be limited to securities that trade in
markets that are members of the ISG. Initially, the Fund will invest at
least 80% of the Fund's net assets in Income Securities of an issuing
firm when the issuer has a long-term issuer credit rating of investment
grade at the time of the investment. Under normal

market conditions, at least 80% of the Fund's investments in US
corporate bonds must have $100 million or more par amount outstanding
to be considered as an eligible investment and a non-U.S. corporate
bond must have $200 million or more par amount outstanding and
significant par value traded to be considered as an eligible
investment. The intra-day, closing, and settlement prices of the
portfolio securities and other instruments will be also readily
available from the national securities exchanges trading such
securities, automated quotation systems, published or other public
sources, or on-line information services. The Fund may hold, in the
aggregate, up to 15% of its net assets in: (1) Illiquid securities,
including non-negotiable certificates of deposit and master demand
notes,\27\ (2) Rule 144A securities, and (3) senior loans, second lien
loans, and loan participation interests. Consistent with the Exemptive
Order, the Fund will not invest in options contracts, futures
contracts, or swap agreements. The Fund's investments will be
consistent with the Fund's investment objective and will not be used to
enhance leverage. The PIV will be widely disseminated by one or more
major market data vendors at least every 15 seconds during the Core
Trading Session.
---------------------------------------------------------------------------

    \27\ See note 14, supra.
---------------------------------------------------------------------------

    The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that the Exchange will obtain a representation from the issuer of the
Shares that the NAV per Share will be calculated daily and that the NAV
and the Disclosed Portfolio will be made available to all market
participants at the same time. In addition, a large amount of
information is publicly available regarding the Fund and the Shares,
thereby promoting market transparency. Moreover, the PIV will be widely
disseminated by one or more major market data vendors at least every 15
seconds during the Exchange's Core Trading Session. On each business
day, before commencement of trading in Shares in the Core Trading
Session on the Exchange, the Fund will disclose on its Web site the
Disclosed Portfolio that will form the basis for the Fund's calculation
of NAV at the end of the business day. Information regarding market
price and trading volume of the Shares will be continually available on
a real-time basis throughout the day on brokers' computer screens and
other electronic services, and quotation and last-sale information will
be available via the CTA high-speed line. The Web site for the Fund
will include a form of the prospectus for the Fund and additional data
relating to NAV and other applicable quantitative information.
Moreover, prior to the commencement of trading, the Exchange will
inform its ETP Holders in an Information Bulletin of the special
characteristics and risks associated with trading the Shares. Trading
in Shares of the Fund will be halted if the circuit breaker parameters
in NYSE Arca Equities Rule 7.12 have been reached or because of market
conditions or for reasons that, in the view of the Exchange, make
trading in the Shares inadvisable, and trading in the Shares will be
subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which sets forth
circumstances under which Shares of the Fund may be halted. In
addition, as noted above, investors will have ready access to
information regarding the Fund's holdings, the PIV, the Disclosed
Portfolio, and quotation and last-sale information for the Shares.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an additional type of actively-managed exchange-traded product that
will enhance competition among market participants, to the benefit of
investors and the marketplace. As noted above, the Exchange has in
place surveillance procedures relating to trading in the Shares and may
obtain information via ISG from other exchanges that are members of ISG
or with which the Exchange has entered into a comprehensive
surveillance sharing agreement. In addition, as noted above, investors
will have ready access to information regarding the Fund's holdings,
the PIV, the Disclosed Portfolio, and quotation and last-sale
information for the Shares.

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

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

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEArca-2012-139 on the subject line.

Paper Comments

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

    All submissions should refer to File Number SR-NYSEArca-2012-139.
This file number should be included on the subject line if email is
used. To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml.) Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street NE., Washington, DC 20549, on official

business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of
the filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; 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-NYSEArca-2012-139 and should be submitted on or before
January 14, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\28\
---------------------------------------------------------------------------

    \28\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-30888 Filed 12-21-12; 8:45 am]
BILLING CODE 8011-01-P