[Federal Register Volume 81, Number 8 (Wednesday, January 13, 2016)]
[Proposed Rules]
[Pages 1580-1582]
[FR Doc No: 2015-33178]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2015-8426; Directorate Identifier 2015-NM-006-AD]
RIN 2120-AA64

Airworthiness Directives; Dassault Aviation Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: We propose to adopt a new airworthiness directive (AD) for
certain Dassault Aviation Model MYSTERE-FALCON 900 airplanes, FALCON
900EX airplanes, and FALCON 2000EX airplanes. This proposed AD was
prompted by a report that during a test flight, it was found that the
yaw damper on the takeoff roll can increase the Minimum Control Speed
on Ground (Vmcg). This proposed AD would require revising the airplane
flight manual to incorporate procedures for the flightcrew to check
that the yaw damper is set to off before takeoff. We are proposing this
AD to ensure that the flightcrew has procedures to set the yaw damper
to ``off'' before takeoff, which, if activated, could result in reduced
control of the airplane if one engine were to fail during takeoff.

DATES: We must receive comments on this proposed AD by February 29,
2016.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC 20590.
     Hand Delivery: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
    For service information identified in this proposed AD, contact
Dassault Falcon Jet, P.O. Box 2000, South Hackensack, NJ 07606;
telephone<PHONE_NUMBER>; Internet http://www.dassaultfalcon.com. You may
view this referenced service information at the FAA, Transport Airplane
Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the
availability of this material at the FAA, call<PHONE_NUMBER>.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2015-
8426; or in person at the Docket Management Facility between 9 a.m. and
5 p.m., Monday through Friday, except Federal holidays. The AD docket
contains this proposed AD, the regulatory evaluation, any comments
received, and other information. The street address for the Docket
Operations office (telephone<PHONE_NUMBER>) is in the ADDRESSES section.
Comments will be available in the AD docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Tom Rodriguez, Aerospace Engineer,
International Branch, ANM-116, Transport Airplane Directorate, FAA,
1601 Lind Avenue SW., Renton, Washington 98057-3356; telephone 425-227-
1137; fax<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposed AD. Send your comments to an address
listed under the ADDRESSES section. Include ``Docket No. FAA-2015-8426;
Directorate Identifier 2015-NM-006-AD'' at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of this proposed AD. We
will consider all comments received by the closing date and may amend
this proposed AD based on those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    The European Aviation Safety Agency (EASA), which is the Technical
Agent for the Member States of the European Union, has issued EASA
Airworthiness Directive 2015-0005, dated January 14, 2015 (referred to
after this as the Mandatory Continuing Airworthiness Information, or
``the MCAI''), to correct an unsafe condition for certain Dassault
Aviation Model MYSTERE-FALCON 900 airplanes, FALCON 900EX airplanes,
and FALCON 2000EX airplanes. The MCAI states:

    During a flight test on a development aeroplane, it was found
that the yaw damper (YD) working on the take-off roll can increase
the Minimum Control Speed on Ground (Vmcg). A review of the
certification data of the affected aeroplanes shows that Vmcg values
published in the Airplane Flight Manuals (AFM) have been determined
without YD.
    This condition, if not corrected, could result, in case of an
engine failure occurring during the roll acceleration [during
takeoff], in reduced lateral control of the aeroplane.
    To address this condition, Dassault Aviation developed Change
Proposals (CP) and Temporary Changes (TC) to the applicable AFMs,
which instruct flight crews to check that yaw damper is set to
``off'' before take-off.
    For the reasons described above, this [EASA] AD requires an
amendment of the applicable AFM.

    You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2015-
8426.

Related Service Information Under 1 CFR Part 51

    We reviewed the following service information:
     Change Proposal 17 (CP017), ``AFM: Yaw Damper Off in Line
Up Procedure,'' dated January 23, 2015, to the Dassault Falcon 2000EX
Airplane Flight Manual, DGT84278.
     Change Proposal 46 (CP046), ``AFM: Yaw Damper Off In Line
Up Procedure,'' dated December 15, 2014, to the Dassault Falcon 2000EX
EASy Version, Airplane Flight Manual, DGT88898.
     Change Proposal 118 (TC118), ``AFM: Yaw Damper Off In Line
Up Procedure,'' dated December 18, 2014, to the Dassault Myst[egrave]re
Falcon 900 Airplane Flight Manual, DTM20103.
     Change Proposal 48 (TC048), ``AFM: Yaw Damper Off In Line
Up Procedure,'' dated December 16, 2014, to the Dassault Myst[egrave]re
Falcon 900, F900C Version, Airplane Flight Manual (FM900C), TC048.
     Change Proposal 12 (CP012), ``AFM: Yaw Damper Off In Line
Up Procedure,'' Dassault Falcon 900EX Airplane Flight Manual DTM561.
     Change Proposal 31 (CP031), ``AFM: Yaw Damper Off In Line
Up Procedure,'' Dassault Falcon 900EX EASy, Airplane Flight Manual
DGT84972).
    The service information describes procedures for the flightcrew to
check that the yaw damper is set to off before takeoff. This service
information is reasonably available because the interested parties have
access to it through their normal course of business or by the means
identified in the ADDRESSES section of this NPRM.

FAA's Determination and Requirements of This Proposed AD

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

Costs of Compliance

    We estimate that this proposed AD affects 284 airplanes of U.S.
registry.
    We also estimate that it would take about 1 work-hour per product
to comply with the basic requirements of this proposed AD. The average
labor rate is $85 per work-hour. Based on these figures, we estimate
the cost of this proposed AD on U.S. operators to be $24,140, or $85
per product.

Authority for This Rulemaking

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

Regulatory Findings

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

List of Subjects in 14 CFR Part 39

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

The Proposed Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive (AD):

Dassault Aviation: Docket No. FAA-2015-8426; Directorate Identifier
2015-NM-006-AD.

(a) Comments Due Date

    We must receive comments by February 29, 2016.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to airplanes specified in paragraphs (c)(1),
(c)(2), and (c)(3) of this AD, certificated in any category.
    (1) Dassault Aviation Model MYSTERE-FALCON 900 airplanes, all
serial numbers.
    (2) Dassault Aviation Model FALCON 900EX airplanes, all serial
numbers, except airplanes with ``EASy II'' ``2nd certification''
avionics, which are defined as: Airplanes modified in production
with Dassault Aviation modification M5595; or airplanes modified in
service with Dassault Aviation Service Bulletin F900EX-400 or with
Dassault Aviation Service Bulletin F900EX-414, except for airplanes
modified in service with any of the service information in
paragraphs (c)(2)(i) through (c)(2)(vii) of this AD.
    (i) Dassault Aviation Service Bulletin F900EX-400, dated July 1,
2011.
    (ii) Dassault Aviation Service Bulletin F900EX-400, Revision 1,
dated July 5, 2012.
    (iii) Dassault Aviation Service Bulletin F900EX-400, Revision 2,
dated November 30, 2012.
    (iv) Dassault Aviation Service Bulletin F900EX-414, dated July
20, 2011.
    (v) Dassault Aviation Service Bulletin F900EX-414, Revision 1,
dated July 5, 2012.
    (vi) Dassault Aviation Service Bulletin F900EX-414, Revision 2,
dated July 27, 2012.
    (vii) Dassault Aviation Service Bulletin F900EX-414, Revision 3,
dated November 30, 2012.
    (3) Dassault Aviation Model FALCON 2000EX airplanes, all serial
numbers, except airplanes with Dassault Aviation production
modification M3254, or modified in service by Dassault Aviation
Service Bulletin F2000EX-300 (``EASy II'' avionics).

(d) Subject

    Air Transport Association (ATA) of America Code 01, Operations
Information.

(e) Reason

    This AD was prompted by a report that during a test flight, it
was found that the yaw damper on the take-off roll can increase the
Minimum Control Speed on Ground (Vmcg). We are issuing this AD to
ensure that the ensure that the flightcrew has procedures to set the
yaw damper to ``off'' before takeoff, which, if activated, could
result in reduced control of the airplane if one engine were to fail
during takeoff.

(f) Compliance

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

(g) Revision of the Airplane Flight Manual (AFM)

    Within 30 days after the effective date of this AD, revise the
normal procedures and limitations sections of the airplane flight
manual, as applicable, to include the information in the applicable
AFM change specified in table 1 to paragraph (g) of this AD. This
may be done by inserting copies of the applicable AFM change
specified in table 1 to paragraph (g) of this AD in the AFM. When
the applicable AFM change specified in table 1 to paragraph (g) of
this AD have been included in general revisions of the AFM, the
general revisions may be inserted into the AFM, provided the
relevant information in the general revision is identical to that in
the applicable AFM change specified in table 1 to paragraph (g) of
this AD, and the applicable AFM change specified in table 1 to
paragraph (g) of this AD may be removed.

 Table 1 to Paragraph (g) of This AD--Normal Procedures and Limitations
------------------------------------------------------------------------
    Affected airplane/configuration           Applicable AFM change
------------------------------------------------------------------------
Model Myst[egrave]re Falcon 900          Change Proposal 118 (TC118),
 airplanes.                               ``AFM: Yaw Damper Off In Line
                                          Up Procedure,'' dated December
                                          18, 2014, to the Dassault
                                          Myst[egrave]re Falcon 900
                                          Airplane Flight Manual,
                                          DTM20103.
Model Myst[egrave]re Falcon 900          Change Proposal 48 (TC048),
 airplanes with Dassault Aviation         ``AFM: Yaw Damper Off In Line
 production modification M1975, or        Up Procedure,'' dated December
 production modification M2695            16, 2014, to the Dassault
 embodied, or modified in service by      Myst[egrave]re Falcon 900,
 Dassault Aviation Service Bulletin       F900C Version, Airplane Flight
 F900-250 (``Falcon 900 C'' version).     Manual (FM900C), TC048.
Model Falcon 900EX airplanes...........  Change Proposal 12 (CP012),
                                          ``AFM: Yaw Damper Off In Line
                                          Up Procedure,'' Dassault
                                          Falcon 900EX Airplane Flight
                                          Manual DTM561.
Model Falcon 900EX airplanes with        Change Proposal 31 (CP031),
 Dassault Aviation production             ``AFM: Yaw Damper Off In Line
 modification M3083 embodied (Falcon      Up Procedure,'' Dassault
 900EX ``EASy'' version).                 Falcon 900EX EASy, Airplane
                                          Flight Manual DGT84972).
Model Falcon 2000EX airplanes..........  Change Proposal 17 (CP017),
                                          ``AFM: Yaw Damper Off in Line
                                          Up Procedure,'' dated January
                                          23, 2015, to the Dassault
                                          Falcon 2000EX Airplane Flight
                                          Manual, DGT84278.
Model Falcon 2000EX airplanes with       Change Proposal 46 (CP046),
 Dassault Aviation production             ``AFM: Yaw Damper Off In Line
 modification M1691 embodied (Falcon      Up Procedure,'' dated December
 2000EX ``EASy'' version).                15, 2014, to the Dassault
                                          Falcon 2000EX EASy Version,
                                          Airplane Flight Manual,
                                          DGT88898.
------------------------------------------------------------------------

(h) Other FAA AD Provisions

    The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager,
International Branch, ANM-116, Transport Airplane Directorate, FAA,
has the authority to approve AMOCs for this AD, if requested using
the procedures found in 14 CFR 39.19. In accordance with 14 CFR
39.19, send your request to your principal inspector or local Flight
Standards District Office, as appropriate. If sending information
directly to the International Branch, send it to ATTN: Tom
Rodriguez, Aerospace Engineer, International Branch, ANM-116,
Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton,
Washington 98057-3356; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>.
Information may be emailed to<EMAIL_ADDRESS>
Before using any approved AMOC, notify your appropriate principal
inspector, or lacking a principal inspector, the manager of the
local flight standards district office/certificate holding district
office. The AMOC approval letter must specifically reference this
AD.
    (2) Contacting the Manufacturer: For any requirement in this AD
to obtain corrective actions from a manufacturer, the action must be
accomplished using a method approved by the Manager, International
Branch, ANM-116, Transport Airplane Directorate, FAA; or the
European Aviation Safety Agency (EASA); or Dassault Aviation's EASA
Design Organization Approval (DOA). If approved by the DOA, the
approval must include the DOA-authorized signature.

(i) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information
(MCAI) EASA Airworthiness Directive 2015-0005, dated January 14,
2015, for related information. This MCAI may be found in the AD
docket on the Internet at http://www.regulations.gov by searching
for and locating Docket No. FAA-2015-8426.
    (2) For service information identified in this AD, contact
Dassault Falcon Jet, P.O. Box 2000, South Hackensack, NJ 07606;
telephone<PHONE_NUMBER>; Internet http://www.dassaultfalcon.com. You
may view this service information at the FAA, Transport Airplane
Directorate, 1601 Lind Avenue SW., Renton, WA. For information on
the availability of this material at the FAA, call<PHONE_NUMBER>.

    Issued in Renton, Washington, on December 23, 2015.
John Piccola,
Acting Manager, Transport Airplane Directorate, Aircraft Certification
Service.
[FR Doc. 2015-33178 Filed 1-12-16; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 80, Number 40 (Monday, March 2, 2015)]
[Notices]
[Pages 11188-11189]
[FR Doc No: 2015-04207]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings #1

    Take notice that the Commission received the following electric
rate filings:

    Docket Numbers: ER13-738-003; ER11-3097-007; ER10-1329-006; ER10-
1277-006; ER10-1212-006; ER10-1211-006; ER10-1188-006; ER10-1186-006.
    Applicants: DTE Electric Company, DTE Energy Trading, Inc., DTE
River Rouge No. 1, LLC, DTE Energy Supply, Inc., DTE East China, LLC,
DTE Pontiac North LLC, DTE Stoneman, LLC, St. Paul Cogeneration, LLC.
    Description: Notice of Change in Status of the DTE MBR Entities.
    Filed Date: 2/20/15.
    Accession Number: 20150220-5253.
    Comments Due: 5 p.m. ET 3/13/15.

    Docket Numbers: ER13-198-007.
    Applicants: PJM Interconnection, L.L.C.
    Description: Compliance filing per 35: Compliance Filing per 1/22/
15 Order in Docket Nos. ER13-198-004 to be effective 1/1/2014.
    Filed Date: 2/23/15.
    Accession Number: 20150223-5189.
    Comments Due: 5 p.m. ET 3/16/15.

    Docket Numbers: ER13-2477-006; ER87-592-001; ER14-1777-002; ER13-
2476-006; ER13-2475-006; ER13-1485-003; ER12-192-009; ER11-4266-010;
ER11-3867-011; ER11-3866-011; ER11-3864-012; ER11-3861-010; ER11-3859-
011; ER11-3857-011; ER10-3310-007; ER10-3299-006; ER10-3253-003; ER10-
3240-003; ER10-3239-003; ER10-3237-003; ER10-3233-002; ER10-3232-001;
ER10-3231-002; ER10-3230-003; ER10-1946-009.
    Applicants: Brayton Point Energy, LLC, Broad River Energy LLC,
Dighton Power, LLC, ELWOOD ENERGY LLC, Empire Generating Co, LLC,
EquiPower Resources Management, LLC, Kincaid Generation, L.L.C., Lake
Road Generating Company, L.P., Liberty Electric Power, LLC, MASSPOWER,
Milford Power Company, LLC, Richland-Stryker Generation LLC, New
Harquahala Generating Company, LLC, Millenium Power Partners, L.P., New
Athens Generating Company, LLC, Wheelabrator Baltimore, L.P.,
Wheelabrator Bridgeport, L.P., Wheelabrator Falls Inc., Wheelabrator
Frackville Energry Co. Inc., Wheelabrator Millbury Inc., Wheelabrator
North Andover Inc., Wheelabrator Portsmouth Inc., Wheelabrator Ridge
Energy Inc., Wheelabrator Saugus Inc., Wheelabrator Shasta Energy Co.
Inc., Wheelabrator South Broward Inc., Wheelabrator Westchester L.P.
    Description: Supplement to January 20, 2015 Notice of Change in
Status of the ECP MBR Sellers.
    Filed Date: 2/20/15.
    Accession Number: 20150220-5240.
    Comments Due: 5 p.m. ET 3/13/15.

    Docket Numbers: ER15-1082-000.
    Applicants: Westwood Generation, LLC.
    Description: Application for Limited Waiver of Westwood Generation,
LLC.
    Filed Date: 2/20/15.
    Accession Number: 20150220-5261.
    Comments Due: 5 p.m. ET 3/6/15.

    Docket Numbers: ER15-1083-000.
    Applicants: Niagara Mohawk Power Corporation, New York Independent
System Operator, Inc.
    Description: Sec.  205(d) rate filing per 35.13(a)(2)(iii): NYISO
filing of SA No. 2205 between NiMo and Covanta Niagara to be effective
12/30/2014.
    Filed Date: 2/23/15.
    Accession Number: 20150223-5106.
    Comments Due: 5 p.m. ET 3/16/15.

    Docket Numbers: ER15-1084-000.
    Applicants: Duke Energy Progress, Inc., Duke Energy Florida, Inc.,
Duke Energy Carolinas, LLC.
    Description: Sec.  205(d) rate filing per 35.13(a)(2)(iii): OATT
Attachment C Amendment to be effective 12/31/9998.
    Filed Date: 2/23/15.
    Accession Number: 20150223-5197.
    Comments Due: 5 p.m. ET 3/16/15.

    Take notice that the Commission received the following electric
securities filings:

    Docket Numbers: ES15-12-000.
    Applicants: Northern Maine Independent System Administrator, Inc.
    Description: Application of Northern Maine Independent System
Administrator, Inc. for Authorization to Issue Securities Pursuant to
Section 204 of the Federal Power Act.
    Filed Date: 2/18/15.
    Accession Number: 20150218-5132.
    Comments Due: 5 p.m. ET 3/11/15.

    The filings are accessible in the Commission's eLibrary system by
clicking on the links or querying the docket number.
    Any person desiring to intervene or protest in any of the above
proceedings must file in accordance with Rules 211 and 214 of the
Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5
p.m. Eastern time on the specified comment date. Protests may be
considered, but intervention is necessary to become a party to the
proceeding.
    eFiling is encouraged. More detailed information relating to filing

requirements, interventions, protests, service, and qualifying
facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call<PHONE_NUMBER>
(toll free). For TTY, call<PHONE_NUMBER>.

     Dated: February 23, 2015.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2015-04207 Filed 2-27-15; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: June 15, 2009 (Volume 74, Number 113)]
[Notices]
[Page 28293-28294]
[DOCID:fr15jn09-139]

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SECURITIES AND EXCHANGE COMMISSION

Sunshine Act Meeting

    Notice is hereby given, pursuant to the provisions of the
Government in the Sunshine Act, Public Law 94-409, that the Securities
and Exchange Commission will hold a Closed Meeting on Friday, June 19,
2009 at 11 a.m.
    Commissioners, Counsel to the Commissioners, the Secretary to the
Commission, and recording secretaries will attend the Closed Meeting.
Certain staff members who have an interest in the matters also may be
present.
    The General Counsel of the Commission, or his designee, has
certified that, in his opinion, one or more of the exemptions set forth
in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR
200.402(a)(3), (5), (7), 9(ii) and (10), permit consideration of the
scheduled matters at the Closed Meeting.
    Commissioner Paredes, as duty officer, voted to consider the items
listed for the Closed Meeting in a closed session.
    The subject matter of the Closed Meeting scheduled for Friday, June
19, 2009 will be: institution and settlement of injunctive actions;
institution and settlement of administrative proceedings; and other
matters related to enforcement proceedings.
    At times, changes in Commission priorities require alterations in
the scheduling of meeting items.
    For further information and to ascertain what, if any, matters have
been added, deleted or postponed, please contact:
    The Office of the Secretary at<PHONE_NUMBER>.

    Dated: June 10, 2009.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-14075 Filed 6-11-09; 11:15 am]

BILLING CODE 8010-01-P


[Federal Register: February 6, 2009 (Volume 74, Number 24)]
[Notices]
[Page 6333-6335]
[DOCID:fr06fe09-91]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59331; File No. SR-CBOE-2009-003]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change Related to Trades for Less Than $1

January 30, 2009.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on January 29, 2009, the Chicago Board Options Exchange,
Incorporated (``Exchange'' or ``CBOE'') filed with the Securities and
Exchange Commission (the ``Commission'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the Exchange. The Exchange filed the proposal as a ``non-
controversial'' proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) thereunder,\4\
which renders the proposal effective upon filing with the Commission.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is proposing to extend its program that allows
transactions to take place at a price that is below $1 per option
contract until May 29, 2009. The text of the proposed rule change is
available on the Exchange's Web site (http://www.cboe.org/Legal), at
the Exchange's Office of the Secretary and at the Commission's Public
Reference Room.

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

    In its filing with the Commission, the 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
    An ``accommodation'' or ``cabinet'' trade refers to trades in
listed options on the Exchange that are worthless or not actively
traded. Cabinet trading is generally conducted in accordance with the
Exchange Rules, except as provided in Exchange Rule 6.54, Accommodation
Liquidations (Cabinet Trades), which sets forth specific procedures for
engaging in cabinet trades. Rule 6.54 currently provides for cabinet
transactions to occur via open outcry at a cabinet price of $1 per
option contract in any options series open for trading in the Exchange,
except that the Rule is not applicable to trading in option classes
participating in the Penny Pilot Program. Under the procedures, bids
and offers (whether opening or closing a position) at a price of $1 per
option contract may be represented in the trading crowd by a Floor
Broker or by a Market-Maker or provided in response to a request by a
PAR Official/OBO, a Floor Broker or a Market-Maker, but must yield
priority to all resting orders in the PAR Official/OBO cabinet book
(which resting cabinet book orders may be closing only). So long as
both the buyer and the seller yield to orders resting in the cabinet
book, opening cabinet bids can trade with opening cabinet offers at $1
per option contract.
    On December 30, 2008, the Exchange temporarily amended the
procedures through January 30, 2009 to allow transactions to take place
in open outcry at a price of at least $0 but less than $1

per option contract.\5\ These lower priced transactions are traded
pursuant to the same procedures applicable to $1 cabinet trades, except
that (i) bids and offers for opening transactions are only permitted to
accommodate closing transactions in order to limit use of the procedure
to liquidations of existing positions, and (ii) the procedures are also
available for trading in option classes participating in the Penny
Pilot Program.\6\ The Exchange believes that allowing a price of at
least $0 but less than $1 better accommodates the closing of options
positions in series that are worthless or not actively traded,
particularly due to recent market conditions which have resulted in a
significant number of series being out-of-the-money. For example, a
market participant might have a long position in a call series with a
strike price of $100 and the underlying stock might now be trading at
$30. In such an instance, there might not otherwise be a market for
that person to close-out the position even at the $1 cabinet price
(e.g., the series might be quoted no bid).\7\
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    \5\ Securities Exchange Act Release No. 59188 (December 30,
2008), 74 FR 480 (January 6, 2009) (SR-CBOE-2008-133).
    \6\ Currently the $1 cabinet trading procedures are limited to
options classes traded in $0.05 or $0.10 standard increment. The $1
cabinet trading procedures are not available in Penny Pilot Program
classes because in those classes an option series can trade in a
standard increment as low as $0.01 per share (or $1.00 per option
contract with a 100 share multiplier). Because the temporary
procedures allow trading below $0.01 per share (or $1.00 per option
contract with a 100 share multiplier), the procedures are available
for all classes, including those classes participating in the Penny
Pilot Program.
    \7\ As with other accommodation liquidations under Rule 6.54,
transactions that occur for less than $1 are not be disseminated to
the public on the consolidated tape. In addition, as with other
accommodation liquidations under Rule 6.54, the transactions are
exempt from the Consolidated Options Audit Trail (``COATS'')
requirements of Exchange Rule 6.24, Required Order Information.
However, the Exchange maintains quotation, order and transaction
information for the transactions in the same format as the COATS
data is maintained. In this regard, all transactions for less than
$1 must be reported to the Exchange following the close of each
business day. The rule also provides that transactions for less than
$1 will be reported for clearing utilizing forms, formats and
procedures established by the Exchange from time to time. In this
regard, the Exchange initially intends to have clearing firms
directly report the transactions to The Options Clearing Corporation
(``OCC'') using OCC's position adjustment/transfer procedures. This
manner of reporting transactions for clearing is similar to the
procedure that CBOE currently employs for on-floor position transfer
packages executed pursuant to Exchange Rule 6.49A, Transfer of
Positions.
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    The purpose of the instant rule change is to extend the operation
of these temporary procedures through May 29, 2009, so that the
procedures can continue without interruption pending review by the
Commission of a separate proposed CBOE rule change filing that will
seek permanent approval of the temporary procedures pursuant to Section
19(b)(2) of the Act.\8\
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    \8\ 15 U.S.C. 78s(b)(2).
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Act \9\ and the rules and regulations thereunder and, in
particular, the requirements of Section 6(b) of the Act.\10\
Specifically, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \11\ requirements that the rules of
an exchange be designed to promote just and equitable principles of
trade, to prevent fraudulent and manipulative acts, to remove
impediments to and to perfect the mechanism for a free and open market
and a national market system, and, in general, to protect investors and
the public interest. The Exchange believes that allowing for
liquidations at a price less than $1 per option contract better
facilitates the closing of options positions that are worthless or not
actively trading.
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    \9\ 15 U.S.C. 78f(b)(1).
    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE does not believe that the proposed rule change will impose any
burden on competition 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

    The Exchange neither solicited nor received comments on the
proposal.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; or (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate if consistent with
the protection of investors and the public interest, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \12\ and Rule 19b-
4(f)(6) thereunder.\13\
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    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
CBOE has satisfied this requirement.
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    CBOE has requested that the Commission waive the 30-day operative
delay to enable Interpretations and Policies .03 to CBOE Rule 6.54 to
continue in effect without interruption while the Exchange formulates a
permanent rule change that will be submitted for Commission review
pursuant to Section 19(b)(2) of the Act.\14\ The Exchange argues that
the extension of the temporary program that allows for accommodation
liquidations to occur at less than $1 per option contract would allow
for the orderly closing of option positions that are worthless and not
actively traded. The Commission believes that waiving the 30-day
operative delay \15\ is consistent with the protection of investors and
the public interest. Therefore, the Commission designates the proposal
operative upon filing.
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    \14\ 15 U.S.C. 78s(b)(2). The Commission notes that CBOE has not
yet filed that proposal.
    \15\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.

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 e-mail to<EMAIL_ADDRESS>Please include
File Number SR-CBOE-2009-003 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-CBOE-2009-003. This file
number should be included on the

subject line if e-mail is used. To help the Commission process and
review your comments more efficiently, please use only one method. The
Commission will post all comments on the Commission's Internet Web site
(http://www.sec.gov/rules/sro.shtml). Copies of the submission, all
subsequent amendments, all written statements with respect to the
proposed rule change that are filed with the Commission, and all
written communications relating to the proposed rule change between the
Commission and any person, other than those that may be withheld from
the public in accordance with the provisions of 5 U.S.C. 552, will be
available for inspection and copying in the Commission's Public
Reference Room, 100 F Street, NE., Washington, DC 20549, on official
business days between the hours of 10 a.m. and 3 p.m. Copies of such
filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make publicly available. All submissions should refer to
File Number SR-CBOE-2009-003 and should be submitted on or before
February 27, 2009.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-2528 Filed 2-5-09; 8:45 am]

BILLING CODE 8011-01-P