[Federal Register Volume 79, Number 85 (Friday, May 2, 2014)]
[Notices]
[Pages 25175-25176]
[FR Doc No: 2014-09995]

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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

Petition for Exemption from the Federal Motor Vehicle Theft
Prevention Standard; Toyota

AGENCY: National Highway Traffic Safety Administration, Department of
Transportation (DOT).

ACTION: Grant of petition for exemption.

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SUMMARY: This document grants in full the Toyota Motor North America,
Inc.'s, (Toyota) petition for an exemption of the Toyota Highlander
vehicle line in accordance with 49 CFR Part 543, Exemption from Vehicle
Theft Prevention Standard. This petition is granted because the agency
has determined that the antitheft device to be placed on the line as
standard equipment is likely to be as effective in reducing and
deterring motor vehicle theft as compliance with the parts-marking
requirements of the 49 CFR Part 541, Federal Motor Vehicle Theft
Prevention Standard (Theft Prevention Standard).

DATES: The exemption granted by this notice is effective beginning with
the 2015 model year (MY).

FOR FURTHER INFORMATION CONTACT: Ms. Deborah Mazyck, International
Policy, Fuel Economy and Consumer Programs, NHTSA, W43-443, 1200 New
Jersey Avenue SE., Washington, DC 20590. Ms. Mazyck's phone number is
(202) 366 4139. Her fax number is<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: In a petition dated December 12, 2013,
Toyota requested an exemption from the parts-marking requirements of
the Theft Prevention Standard for the Highlander vehicle line beginning
with MY 2015. The petition requested an exemption from parts-marking
pursuant to 49 CFR Part 543, Exemption from Vehicle Theft Prevention
Standard, based on the installation of an antitheft device as standard
equipment for the entire vehicle line.
    Under 49 CFR 543.5(a), a manufacturer may petition NHTSA to grant
an exemption for one vehicle line per model year. In its petition,
Toyota provided a detailed description and diagram of the identity,
design, and location of the components of the antitheft device for the
Highlander vehicle line. Toyota stated that the MY 2015 Highlander
vehicle line will be installed with an engine immobilizer device as
standard equipment. Toyota further stated that its Highlander vehicle
line will be equipped with either of the three entry systems, a ``smart
entry and start system'', a ``conventional key'' entry system and a
hybrid vehicle ``smart entry and start system'' for its hybrid vehicle
(HV) model. Key components of the normal ``smart entry and start''
system will include an engine immobilizer, a certification electronic
control unit (ECU), engine switch, steering lock ECU, security
indicator, door control receiver, electrical key and an electronic
control module (ECM). The ``conventional key'' system components
consist of an engine immobilizer, transponder key ECU assembly,
transponder key coil, security indicator, ignition key and an (ECM).
Key components of the hybrid vehicle ``smart entry and start'' system
will be an engine immobilizer, certification ECU, power switch,
steering lock ECU, security indicator, door control receiver,
electrical key, power source HV-ECU and an ECM. Toyota also stated that
only the upper trim level Highlander models will be equipped with an
audible and visual alarm and there will be position switches installed
in the vehicle to protect its hood and doors from unauthorized entry.
The position switches will trigger the alarm system when they sense
inappropriate opening of the hood. The position switches in the doors
will trigger the alarm system when an attempt is made to open any of
the doors without the use of a key, a wireless switch or a smart entry
system. Additionally, Toyota stated that all of the doors can be locked
by using a key, a wireless switch or a smart entry system. Toyota's
submission is considered a complete petition as required by 49 CFR
543.7 in that it meets the general requirements contained in Sec.
543.5 and the specific content requirements of Sec.  543.6.
    Toyota stated that its normal ``smart entry and start system''--
installed system allows the driver to press the engine switch button
located on the instrument panel to start the vehicle. Once the driver
pushes the engine switch button, the certification ECU verifies the
electrical key. When the key is verified, the certification ECU and
steering lock ECU receive confirmation of the valid key, and the
certification ECU allows the ECM to start the engine. With the
``conventional key' system, once the key is inserted into the key
cylinder, the transponder chip in the key sends the key ID codes to the
transponder key ECU assembly to verify the code. Once the code has been
verified, the immobilizer will allow the ECM to start the engine. With
the hybrid vehicle ``smart entry and start'' system, once the driver/
operator pushes the power switch button, the certification ECU verifies
the key. Once the key is verified and the certification ECU and
steering lock ECU receive confirmation of a valid key, the
certification ECU will allow the ECM to start the vehicle.
    Toyota stated that with its normal ``smart entry and start
system,'' the immobilizer is activated when the engine switch is pushed
from the ``ON'' status to any other ignition status, the certification
ECU performs the calculation of the immobilizer and then the
immobilizer signals the ECM to activate the device. For the
``conventional key'' system, activation of the immobilizer occurs when
the ignition key is turned from the ``ON'' status to any other position
and/or the key is removed. For the smart entry and start system for the
HV models, the immobilizer is activated when the engine switch is
pushed from the ``ON'' status to any other ignition status, the
certification ECU performs the calculation of the immobilizer and then
the immobilizer signals the Power Management ECU to activate the
device. The device is deactivated in its ``smart key-installed
systems'' when the doors are unlocked and the device recognizes the key
code. Deactivation of the ``conventional key system'' occurs when the
door is unlocked and the key is turned to the ``ON'' position. Toyota
also stated that the devices' security indicator will provide the
immobilizer status for its Highlander vehicle line. When the
immobilizer is activated, the indicator flashes continuously. When the
immobilizer is not activated, the indicator is turned off.
    In addressing the specific content requirements of Sec.  543.6,
Toyota provided information on the reliability and durability of its
proposed device. To ensure reliability and durability of the device,
Toyota conducted tests based on its own specified standards. Toyota
provided a detailed list of the tests conducted (i.e., high and low
temperature, strength, impact, vibration, electro-magnetic
interference, etc.). Toyota stated that it believes that its device is
reliable and durable because it complied with its own specific design
standards and the antitheft device is installed on other vehicle lines
for which the agency has granted a parts-marking exemption. Toyota
stated that the antitheft device is already installed as standard
equipment on its MY 2014 Highlander and has been on the Highlander HV
model beginning with its MY 2008 vehicles. Toyota further stated that
it plans to continue to install the device on its MY 2015 Highlander
and HV vehicles. The theft rate for the Toyota Highlander vehicle line
using an average of three model years' data (MYs

2009-2011) is 0.5669, well below the median theft rate of 3.5826. As an
additional measure of reliability and durability, Toyota stated that
its vehicle key cylinders are covered with casting cases to prevent the
key cylinder from easily being broken. Toyota further stated that there
are also so many key cylinder combinations and key plates for its
gutter keys it would be very difficult to unlock the doors without
using a valid key.
    Toyota also compared its proposed device to other devices NHTSA has
determined to be as effective in reducing and deterring motor vehicle
theft as would compliance with the parts-marking requirements (i.e.,
Toyota Prius and Prius v Toyota Camry and Corolla, Lexus LS and GS
vehicle lines). The Toyota Camry, Corolla, Lexus LS and GS vehicle
lines have all been granted parts-marking exemptions by the agency. The
theft rates for the Toyota Camry, Corolla, Lexus LS, GS and Prius
vehicle lines using an average of three model years' data (2009-2011)
are 1.8415, 1.3295, 0.7258, 0.6315 and 0.2675 respectively. Therefore,
Toyota has concluded that the antitheft device proposed for its
Highlander vehicle line is no less effective than those devices in the
lines for which NHTSA has already granted full exemption from the
parts-marking requirements. Toyota believes that installing the
immobilizer as standard equipment reduces the theft rate and expects
the Highlander to experience comparable effectiveness ultimately being
more effective than parts-marking labels.
    Based on the evidence submitted by Toyota, the agency believes that
the antitheft device for the Highlander vehicle line is likely to be as
effective in reducing and deterring motor vehicle theft as compliance
with the parts-marking requirements of the Theft Prevention Standard
(49 CFR part 541).
    Pursuant to 49 U.S.C. 33106 and 49 CFR 543.7 (b), the agency grants
a petition for exemption from the parts-marking requirements of Part
541, either in whole or in part, if it determines that, based upon
substantial evidence, the standard equipment antitheft device is likely
to be as effective in reducing and deterring motor vehicle theft as
compliance with the parts-marking requirements of Part 541. The agency
finds that Toyota has provided adequate reasons for its belief that the
antitheft device for the Toyota Highlander vehicle line is likely to be
as effective in reducing and deterring motor vehicle theft as
compliance with the parts-marking requirements of the Theft Prevention
Standard (49 CFR Part 541). This conclusion is based on the information
Toyota provided about its device.
    The agency concludes that the device will provide four of the five
types of performance listed in Sec.  543.6(a)(3): promoting activation;
preventing defeat or circumvention of the device by unauthorized
persons; preventing operation of the vehicle by unauthorized entrants;
and ensuring the reliability and durability of the device.
    For the foregoing reasons, the agency hereby grants in full
Toyota's petition for exemption for the Toyota Highlander vehicle line
from the parts-marking requirements of 49 CFR Part 541. The agency
notes that 49 CFR Part 541, Appendix A-1, identifies those lines that
are exempted from the Theft Prevention Standard for a given model year.
49 CFR 543.7(f) contains publication requirements incident to the
disposition of all Part 543 petitions. Advanced listing, including the
release of future product nameplates, the beginning model year for
which the petition is granted and a general description of the
antitheft device is necessary in order to notify law enforcement
agencies of new vehicle lines exempted from the parts marking
requirements of the Theft Prevention Standard.
    If Toyota decides not to use the exemption for this line, it should
formally notify the agency. If such a decision is made, the line must
be fully marked according to the requirements under 49 CFR 541.5 and
541.6 (marking of major component parts and replacement parts).
    NHTSA notes that if Toyota wishes in the future to modify the
device on which this exemption is based, the company may have to submit
a petition to modify the exemption. Section 543.7(d) states that a Part
543 exemption applies only to vehicles that belong to a line exempted
under this part and equipped with the antitheft device on which the
line's exemption is based. Further, section 543.9(c)(2) provides for
the submission of petitions ``to modify an exemption to permit the use
of an antitheft device similar to but differing from the one specified
in that exemption.''
    The agency wishes to minimize the administrative burden that
section 543.9(c)(2) could place on exempted vehicle manufacturers and
itself. The agency did not intend in drafting Part 543 to require the
submission of a modification petition for every change to the
components or design of an antitheft device. The significance of many
such changes could be de minimis. Therefore, NHTSA suggests that if the
manufacturer contemplates making any changes, the effects of which
might be characterized as de minimis, it should consult the agency
before preparing and submitting a petition to modify.

    Authority: 49 U.S.C. 33106; delegation of authority at 49 CFR
1.50.

Claude H. Harris,
Acting Associate Administrator for Rulemaking.
[FR Doc. 2014-09995 Filed 5-1-14; 8:45 am]
BILLING CODE 4910-59-P


[Federal Register Volume 75, Number 249 (Wednesday, December 29, 2010)]
[Notices]
[Pages 82119-82120]
[FR Doc No: 2010-32732]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63599; File No. SR-MSRB-2010-16]

Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Order Granting Approval of Amendments to Rule G-5, on
Disciplinary Actions by Appropriate Regulatory Agencies, Remedial
Notices by Registered Securities Associations; and Rule G-17, on
Conduct of Municipal Securities Activities

December 22, 2010.

I. Introduction

    On November 1, 2010, the Municipal Securities Rulemaking Board
(``MSRB''), filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Exchange Act''),\1\ and Rule 19b-4
thereunder,\2\ a proposed rule change which consists of amendments to
Rule G-5, on disciplinary actions by appropriate regulatory agencies,
and Rule G-17, the Board's basic fair practice rule, to apply the rules
to municipal advisors. The proposed rule change was published for
comment in the Federal Register on November 18, 2010.\3\ The Commission
received one comment letter about the proposed rule change which
supported the proposed rule change.\4\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 63309 (November 12,
2010), 75 FR 70756 (the ``Commission's Notice'').
    \4\ See letter from the National Association of Independent
Public Finance Advisors, dated December 9, 2010.
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    This order approves the proposed rule change.

II. Description of the Proposed Rule Change

    Rule G-5 currently provides that brokers, dealers, and municipal
securities dealers (``dealers'') may not engage in municipal securities
activities in contravention of restrictions imposed on them by the
Commission, a registered securities association, or another appropriate
regulatory agency. The purpose of the portion of the proposed rule
change consisting of amendments to Rule G-5 are a) to remove a
reference to an outdated National Association of Securities Dealers
(``NASD'') \5\ rule and b) to provide that municipal advisors and their
associated persons may not engage in the municipal advisory activities
described in Section 15B(e)(4)(A)(i) and (ii) of the Act in
contravention of restrictions imposed upon them by the Commission.
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    \5\ In 2007, the NASD merged with the New York Stock Exchange's
regulation committee to form the Financial Industry Regulatory
Authority, or FINRA. See Securities Exchange Act Release No. 56145
(July 26, 2007), 72 FR 42169 (August 1, 2007).
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    Rule G-17 currently provides that, in the conduct of its municipal
securities activities, each dealer shall deal fairly with all persons
and shall not engage in any deceptive, dishonest, or unfair practice.
The purpose of the portion of the proposed rule change consisting of
amendments to Rule G-17 is to apply the MSRB's core fair dealing rule
to municipal advisors in the same manner that it currently applies to
dealers.
    A more complete description of the proposal is contained in the
Commission's Notice.
    The proposed rule change shall be effective upon Commission
approval.

 III. Discussion and Commission Findings

    The Commission has carefully considered the proposed rule change
and finds that the proposed rule change is consistent with the
requirements of the Exchange Act and the rules and regulations
thereunder applicable to the MSRB \6\ and, in particular, the
requirements of Section 15B(b)(2) of the Exchange Act \7\ and the rules
and regulations thereunder. Section 15B(b)(2)(C) of the Exchange Act
requires, among other things, that the MSRB's rules be designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in municipal securities and municipal financial products, to remove
impediments to and perfect the mechanism of a free and open market in
municipal securities and municipal financial products, and, in general,
to protect investors, municipal entities, obligated persons and the
public interest.\8\ Section 15B(b)(2)(L) of the Exchange Act requires,
among other things, that the rules of the MSRB not impose a regulatory
burden on small municipal advisors that is not necessary or appropriate
in the public interest and for the protection of investors, municipal
entities, and obligated

persons, provided that there is robust protection of investors against
fraud.\9\
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    \6\ In approving this proposed rule change, the Commission notes
that it has considered the proposed rule's impact on efficiency,
competition and capital formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78o-4(b)(2).
    \8\ 15 U.S.C. 78o-4(b)(2)(C).
    \9\ 15 U.S.C. 78o-4(b)(2)(L).
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    The Commission believes that the proposed rule change is consistent
with Section 15B(b)(2) of the Exchange Act, because it provides that:
(i) municipal advisors shall deal fairly with all persons and not
engage in any deceptive, dishonest, or unfair practice and (ii)
municipal advisors and their associated persons shall not conduct
municipal advisory activities in contravention of restrictions imposed
upon them by the Commission. Such restrictions are, amongst other
things, consistent with Section 15B(b)(2)(C) of the Exchange Act
because they are designed to prevent fraudulent and manipulative acts
and practices and to promote just and equitable principles of trade.
The Commission further believes that the proposed rule change is
consistent with Section 15B(b)(2)(L) of the Exchange Act because the
proposed rule change does not impose a regulatory burden on small
municipal advisors that is not necessary or appropriate in the public
interest and the proposed rule change is necessary for the robust
protection of investors against fraud as well as the protection of
municipal entities and obligated persons. Many municipal advisors play
a key role in the structuring of offerings of municipal securities and
the preparation of offering documents used to market those securities
to investors. In some cases, they advise on the appropriateness of
municipal financial products, including municipal derivatives, entered
into by municipal entities, the effectiveness of which may have a
substantial impact on the finances of those municipal entities. In
other cases, they solicit municipal entities and obligated persons for
investment advisory business with respect to funds held by or on behalf
of such municipal entity or obligated person which, if not conducted
according to the highest standards, may have a substantial effect on
the finances of the municipal entities and obligated persons that
control those funds. Investors, therefore, have a substantial interest
in municipal advisors conducting their municipal advisory activities
fairly, not engaging in fraudulent conduct, and not engaging in
municipal advisory activities contrary to disciplinary actions imposed
by the Commission.
    The proposal will become effective upon Commission approval.
    It is therefore ordered, pursuant to Section 19(b)(2) of the
Exchange Act,\10\ that the proposed rule change (SR-MSRB-2010-16), be,
and it hereby is, approved.
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    \10\ 15 U.S.C. 78s(b)(2).
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    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-32732 Filed 12-28-10; 8:45 am]
BILLING CODE 8011-01-P